UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1996
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 0-20868
UNITED WASTE SYSTEMS, INC.
(Exact name of Registrant as specified in its charter)
Delaware 13-3532338
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
Four Greenwich Office Park, Greenwich, Connecticut 06830
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (203) 622-3131
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements
for the past 90 days.
X Yes No
APPLICABLE ONLY TO CORPORATE ISSUERS:
The number of shares outstanding of each of the issuer's classes of
common stock as of November 12, 1996:
Common Stock, $.001 par value 37,329,979 shares
UNITED WASTE SYSTEMS, INC.
FORM 10-Q FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1996
INDEX
Page
PART I FINANCIAL INFORMATION
Item 1 Unaudited Condensed Consolidated Financial Statements
Condensed Consolidated Balance Sheets as of
September 30, 1996 and December 31, 1995
(unaudited). . . . . . . . . . . . . . . . . . . . . .3
Condensed Consolidated Statements of Operations for
the Nine and Three Months Ended September 30, 1996
and 1995(unaudited). . . . . . . . . . . . . . . . . .5
Condensed Consolidated Statement of Stockholders'
Equity for the Nine Months Ended September 30, 1996
(unaudited). . . . . . . . . . . . . . . . . . . . . .6
Condensed Consolidated Statements of Cash Flows for
the Nine Months Ended September 30, 1996 and 1995
(unaudited). . . . . . . . . . . . . . . . . . . . . .7
Notes to Unaudited Condensed Consolidated Financial
Statements . . . . . . . . . . . . . . . . . . . . . .9
Item 2 Management's Discussion and Analysis of Financial
Condition and Results of Operations. . . . . . . . . 19
PART II OTHER INFORMATION
Item 1 Legal Proceedings. . . . . . . . . . . . . . . . . . 31
Item 6 Exhibits and Reports on Form 8-K . . . . . . . . . . 32
Signatures . . . . . . . . . . . . . . . . . . . . . 34
<TABLE>
UNITED WASTE SYSTEMS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
<CAPTION>
September 30 December 31
1996 1995
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 32,729,728 $ 6,721,849
Accounts receivable, net of
allowance for doubtful accounts
of $3,262,000 in 1996 and
$2,250,000 in 1995 48,655,972 38,522,126
Prepaid expenses and other current
assets 16,312,559 14,198,544
Total current assets 97,698,259 59,442,519
Property and equipment, net
of accumulated depreciation of
$86,629,000 in 1996 and
$58,867,000 in 1995 346,265,574 289,378,346
Intangible assets, net 237,029,753 171,739,197
Other assets 24,568,389 20,008,399
$ 705,561,975 $ 540,568,461
Current liabilities:
Current portion of long-term debt
and nonrecourse bonds $ 3,632,127 $ 5,644,096
Accounts payable 23,339,835 18,031,701
Deferred revenue 9,359,086 8,291,415
Due to seller 4,872,666 6,465,720
Short-term accrued landfill costs 3,740,634 6,524,024
Current portion of capital lease
obligations 444,410 1,383,576
Accrued expenses and other current
liabilities 29,011,768 17,077,402
Total current liabilities 74,400,526 63,417,934
Long-term debt, less current portion 261,908,272 156,193,971
Obligations under capital leases, less
current portion 405,135 4,687,554
Nonrecourse sewage facility revenue bonds,
less current portion 9,100,000 9,400,000
Accrued landfill costs 37,808,377 27,663,907
Other long-term liabilities 5,748,412 3,056,578
Deferred income taxes 36,404,927 33,885,306
Commitments and contingencies
</TABLE>
The accompanying notes are an integral part of these condensed
consolidated financial statements.
<TABLE>
UNITED WASTE SYSTEMS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
<CAPTION>
September 30 December 31
1996 1995
<S> <C> <C>
Stockholders' equity:
Common stock, $.001 par value,
75,000,000 in 1996 and 25,000,000
in 1995 shares authorized;
37,237,959 in 1996 and 17,578,550
in 1995 shares issued and outstanding 37,238 17,579
Additional paid-in capital 219,503,908 200,267,630
Retained earnings 60,245,180 41,978,002
Total stockholders' equity 279,786,326 242,263,211
$ 705,561,975 $ 540,568,461
</TABLE>
The accompanying notes are an integral part of these condensed
consolidated financial statements.
<TABLE>
UNITED WASTE SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<CAPTION>
Nine Months Ended Three Months Ended
September 30 September 30
1996 1995 1996 1995
<S> <C> <C> <C> <C>
Revenues $ 241,884,894 $ 160,289,684 $ 90,046,875 $ 63,323,382
Cost of operations 149,595,905 99,196,676 53,116,121 37,196,840
Selling, general
and administrative
expense 38,813,005 24,870,301 14,034,912 9,737,030
Income from operations 53,475,984 36,222,707 22,895,842 16,389,512
Interest expense 11,054,451 6,930,500 3,897,871 2,403,392
Other expense
(income), net 1,131,112 (711,638) (686,422) (292,685)
Income before provision
for income taxes 41,290,421 30,003,845 19,684,393 14,278,805
Provision for income
taxes 17,477,254 11,609,191 8,291,535 5,549,562
Net income 23,813,167 18,394,654 11,392,858 8,729,243
Net deductions
from income
available to
common stockholders 372,501
Income available to
common stockholders $ 23,813,167 $ 18,022,153 $ 11,392,858 $ 8,729,243
Primary earnings per
common share and
common equivalent
share $ .60 $ .54 $ .29 $ .24
Fully diluted
earnings per
common share and
common equivalent
share $ .53 $ .28
</TABLE>
The accompanying notes are an integral part of these condensed
consolidated financial statements.
<TABLE>
UNITED WASTE SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
(UNAUDITED)
<CAPTION>
Common Stock
Number Additional
of Paid-in Retained
Shares Amount Capital Earnings
<S> <C> <C> <C> <C>
Balance,
December 31, 1995 17,578,550 $17,579 $200,267,630 $41,978,002
Poolings-of-interests 579,857 580 335,719 (2,395,684)
Exercise of common
stock warrants
and options 1,175,594 1,175 16,631,490
Issuance of
common stock 30,622 31 1,144,894
Two-for-one stock
split 17,873,336 17,873 (17,873)
Pro forma tax
adjustment (261,454)
Subchapter S
distributions of
pooled entities (1,240,000)
Reclassification of
Subchapter S accumulated
earnings to paid-in
capital 1,142,048 (1,142,048)
Adjustment to conform
fiscal year of pooled
entities (506,803)
Net income 23,813,167
Balance,
September 30, 1996 37,237,959 $ 37,238 $ 219,503,908 $ 60,245,180
</TABLE>
The accompanying notes are an integral part of these condensed
consolidated financial statements.
<TABLE>
UNITED WASTE SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<CAPTION>
Nine Months Ended
September 30
1996 1995
<S> <C> <C>
Cash flows from operating activities:
Net income $ 23,813,167 $ 18,394,654
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 27,736,238 17,012,269
Deferred income taxes 3,942,115 913,860
Gain on sale of assets (364,586) (138,616)
Pro forma tax adjustment (261,454) 1,443,032
Changes in operating assets and
liabilities:
Accounts receivable (5,903,874) (1,146,220)
Other assets (1,869,449) (6,796,096)
Accounts payable 1,909,163 563,659
Accrued landfill costs (1,647,228) 1,195,171
Other liabilities 9,422,210 5,807,271
Net cash provided by operating
activities 56,776,302 37,248,984
Cash flows from investing activities:
Purchases of property and equipment (41,045,951) (23,989,402)
Proceeds from sale of assets 1,013,141 139,733
Restricted investments, net (held to
maturity) 744,770 (7,612,087)
Payments of contingent purchase price (2,582,857) (1,720,938)
Payments of capitalized project costs (1,297,096) (420,331)
Purchases of other companies,
net of cash acquired (88,219,073) (155,429,399)
Net cash used in investing activities (131,387,066) (189,032,424)
Cash flows from financing activities:
Due to sellers (6,869,162) (803,808)
Dividends on preferred stock (372,501)
Proceeds from debt 183,070,484 271,425,663
Repayments of debt (81,869,977) (173,066,780)
Repayments of capital lease
obligations (4,368,367) (838,888)
Payments of financing costs (4,737,000) (2,684,074)
Proceeds from exercise of common
stock warrants and options 16,632,665 2,943,826
</TABLE>
The accompanying notes are an integral part of these condensed
consolidated financial statements.
<TABLE>
UNITED WASTE SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - continued
(UNAUDITED)
<CAPTION>
Nine Months Ended
September 30
1996 1995
<S> <C> <C>
Net proceeds from issuance
of common stock 66,040,771
Subchapter S distributions
of pooled entities (1,240,000) (5,241,200)
Net cash from financing activities 100,618,643 157,403,009
Increase in cash and
cash equivalents 26,007,879 5,619,569
Cash and cash equivalents at
beginning of period 6,721,849 2,598,207
Cash and cash equivalents at
end of period $32,729,728 $8,217,776
Supplemental disclosure of cash flow
information:
Cash paid during the period for interest,
net of amounts capitalized $ 9,926,111 $ 6,137,656
Cash paid during the period for
income taxes $ 5,340,755 $ 7,495,432
Supplemental schedule of noncash investing
and financing activities:
The Company acquired the net assets
and assumed certain liabilities of
other companies as follows:
Fair value of net assets acquired:
Property and equipment $ 31,112,159 $ 121,282,615
Other assets, net of cash acquired 77,624,727 119,710,975
Less liabilities assumed (13,791,265) (54,552,657)
Less amounts due to seller (5,456,729) (14,834,605)
Less amounts paid in common stock (1,144,983) (13,646,965)
Less deposits and capitalized project
costs paid in prior periods (124,836) (2,529,964)
Net cash paid $ 88,219,073 $155,429,399
Conversion of convertible
debt
$ 2,660,843
</TABLE>
The accompanying notes are an integral part of these condensed
consolidated financial statements.
UNITED WASTE SYSTEMS, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
September 30, 1996 and 1995
Note 1 - Basis of presentation
The condensed consolidated financial statements of United
Waste Systems, Inc. and its subsidiaries (the "Company") for the
three and nine months ended September 30, 1996 have been restated
to include the accounts of three acquisitions completed in
September 1996, that were accounted for as pooling-of-interests.
The historical operations of these three acquisitions are not
material to the Company's consolidated operations and financial
position and, therefore, prior years have not been restated. In
addition, the condensed consolidated financial statements at
December 31, 1995 and for the three and nine months ended September
30, 1995 have been restated to include the accounts of an
acquisition completed on June 28, 1996, that was accounted for as
a pooling-of-interests. See Note 2.
The Company's consolidated balance sheet as of December 31,
1995, included herein has been restated as described above. Such
restated balance sheet has been audited and filed as an Exhibit to
a Current Report on Form 8-K dated June 28, 1996, previously filed
by United Waste Systems, Inc. As a result of such restatement, the
condensed consolidated balance sheet of the Company as of December
31, 1995 included herein is different than the audited consolidated
balance sheet of the Company as of such dated included in the
Company's 1995 Annual Report on Form 10-K.
The condensed consolidated financial statements included
herein are unaudited and, in the opinion of management, such
financial statements reflect all adjustments necessary to present
a fair statement of the results of the interim periods presented.
Interim financial statements do not require all disclosures
normally presented in year-end financial statements, and,
accordingly, certain disclosures have been omitted.
Effective January 1, 1996, the Company adopted the provisions
of Statement No. 121, Accounting for the Impairment of Long-Lived
Assets and for Long-Lived Assets to Be Disposed of ("SFAS No.
121"), issued by the Financial Accounting Standards Board. SFAS
No. 121 requires impairment losses to be recorded on long-lived
assets used in operations when indicators of impairment are present
and the undiscounted cash flows estimated to be generated by those
assets are less than the assets' carrying amount. SFAS No. 121
also addresses the accounting for long-lived assets that are
expected to be disposed of. The adoption and on-going effects of
this Statement did not have a material effect on the Company's
financial position or results of operations for the three and nine
months ended September 30, 1996.
Note 2 - Acquisitions
During the nine months ended September 30, 1996, the Company
completed the following acquisitions of businesses (not including
acquisitions described below that were accounted for as a poolings-of-
interests):
<TABLE>
<CAPTION>
Company Business Date Acquired
<S> <C> <C>
United Waste Systems, Inc.
(MN) (not previously affiliated
with the Company) Collection January 1996
Cardinal Sanitation, Inc. Collection January 1996
Albany Disposal Service, Inc. Collection January 1996
Hudson & Sons Sanitation Collection January 1996
Commercial Disposal Company, Inc. Collection/ January 1996
Transfer
Station
Central Sanitary Landfill, Inc. Landfill/ February 1996
Collection
Robert Wright Disposal, Inc. Collection February 1996
Creech Sanitation Collection February 1996
Cheshire Sanitation, Inc. Collection/ February 1996
Transfer
Station
Charlie's Rubbish Collection March 1996
Benjamin Scott Collection March 1996
Milby Sanitation Collection April 1996
Suburban Sanitation Service, Inc. Collection/ April 1996
Recycling
Dafter Sanitary Landfill, Inc. Landfill/ April 1996
Collection
JJ Young Collection April 1996
McDaniel Landfill, Inc. Landfill/ May 1996
Collection/
Transfer Station
DSI of Shawano County, Inc. Collection May 1996
Dietrich Sanitary Service, Inc. Collection/ May 1996
Recycling
Peterson Demolition, Inc. Transfer/ May 1996
Collection
Manca Brothers Landfills June 1996
Fred Bauer Collection June 1996
Twin City Sanitation, Inc. Collection June 1996
Carpenter Trucking Collection June 1996
Rubbish Busters, Inc. Collection June 1996
United Waste Systems, Inc.(CO) Landfill/ June 1996
(not previously affiliated Collection/
with the Company) Transfer Station
Andrews Rubbish Collection June 1996
Peter Corellis
Rubbish Removal, Inc. Collection June 1996
Missouri River Collection/ July 1996
Sanitation, Inc. Transfer Station
Cecil Shykes Sanitary Collection July 1996
Service, Inc.
Baker's Rural Collection July 1996
Sanitation, Inc.
Midwest Sanitation Collection August 1996
Service, Inc.
Arnold Trusty Collection August 1996
County Waste & Recycling Collection August 1996
Services of Western
New York, Inc.
Adirondack Waste Collection August 1996
Systems, Inc.
Albany-Greene Collection August 1996
Sanitation, Inc.
CDF Consolidated Corporation Collection/ August 1996
Transfer Station
Okalona Sanitation, Inc. Collection August 1996
Beardsely Disposal, Inc. Collection August 1996
Al's Rubbish Removal Collection September 1996
Burbridge Trash Collection September 1996
Service, Inc.
Bauer Sanitation Collection/ September 1996
Transfer Station
Seay Brothers Collection September 1996
Rolloff, Inc.
Fitzpatrick Disposal/ Collection September 1996
City Trash
Danny Flynn Collection September 1996
Collection Company
Janie & Dewie Collection September 1996
Collection Company
Indoor-Outdoor Collection September 1996
Environmental, Inc.
Ken's Waste Disposal Collection September 1996
</TABLE>
The above acquisitions have been accounted for as purchases
and, accordingly, the results of their operations have been
included in the Company's condensed consolidated financial
statements from their respective acquisition dates.
The following table summarizes, on an unaudited pro forma
basis, the combined results of operations of the Company for the
nine months ended September 30, 1996 and 1995 as though (i) each
acquisition described above (excluding certain thereof that were
not material individually or in the aggregate) which was
consummated in the nine months ended September 30, 1996, was made
on January 1, 1996, in the case of the results for the nine months
ended September 30, 1996, and (ii) each acquisition which was
consummated during the period of January 1, 1995 to September 30,
1996 as described above and in Note 3 to the Notes to Consolidated
Financial Statements included in the Company's 1995 Annual Report
on Form 10-K (excluding certain thereof that were not material
individually or in the aggregate), was made on January 1, 1995, in
the case of the results for the nine months ended September 30,
1995.
<TABLE>
<CAPTION>
1996 1995
<S> <C> <C>
Revenues $ 250,036,947 $ 226,382,025
Net income 23,706,203 17,511,529
Earnings
per common share and common
equivalent share .61 .51
</TABLE>
The unaudited pro forma results are based upon certain
assumptions and estimates which are subject to change. These
results are not necessarily indicative of the actual results of
operations that might have occurred, nor are they necessarily
indicative of expected results in the future.
On September 29, 1995, the Company acquired all of the
outstanding stock of Carmel Marina Corporation, Neal Road Landfill
Corporation, Jolon Road Landfill Corporation, Cal Sanitation
Services, Inc., Portable Site Services, Inc. and certain real
estate assets (the "Carmel Marina Companies"), a group of
affiliated companies that comprise an integrated solid waste
management company. The transaction was accounted for as a
pooling-of-interests and, accordingly, the condensed consolidated
financial statements for the three and nine months ended September
30, 1995, include the accounts of the Carmel Marina Companies. In
connection with the transaction, the Company incurred an after tax
charge totaling approximately $586,000 relating to the pooling-of-interests.
On June 28, 1996, the Company issued 730,765 shares of its
Common Stock for all of the outstanding stock of Salinas Disposal
Services, Inc., Rural Dispos-All Services, Inc. and Madison Lane
Properties, Inc. (the "Salinas Companies"), a group of affiliated
companies that comprise an integrated solid waste management
company. The transaction was accounted for as a pooling-of-interests and,
accordingly, the condensed consolidated financial
statements at December 31, 1995 and for all periods presented
include the accounts of the Salinas Companies. In connection with
the transaction, the Company incurred an after tax charge totaling
approximately $1.7 million relating to the pooling-of-interests.
The financial statements of the Salinas Companies were
prepared based on a September 30 fiscal year end. The year end for
the Salinas Companies has been changed to December 31 to conform to
the Company's year end. As a result, the operations of the Salinas
Companies for the three months ended December 31, 1995 are not
reflected in the Company's financial statements. The loss
available to common shareholders of the Salinas Companies for this
period has been charged to the Company's retained earnings. The
revenues and net loss available to common shareholders for the
Salinas Companies during this period totaled $4.2 million and
$507,000, respectively.
During September 1996, the Company (i) acquired a collection
company in a transaction in which the Company issued 470,985 shares
of its Common Stock for the assets of Truk-Away of R.I., Inc.,
Recycling of R.I., Inc., and B.W. Properties, a group of affiliated
companies (collectively, the "Truk-Away Companies"); (ii) acquired
an integrated solid waste management company in a transaction in
which the Company issued 73,146 shares of its Common Stock for all
of the outstanding stock of Jones Sanitation, Inc, and the assets
of River City Refuse, Inc., two affiliated companies (collectively,
the "Jones Companies"); and (iii) acquired an integrated solid
waste management company in a transaction in which the Company
issued 35,726 shares of its Common Stock for all of the outstanding
stock of Jahner Sanitation, Inc. ("Jahner"). These transactions
were accounted for as pooling-of-interests and, accordingly, the
condensed consolidated financial statements for the three and nine
months ended September 30, 1996 have been restated to include the
accounts of the Truk-Away Companies, the Jones Companies and Jahner
(excluding, in the case of asset purchases, any accounts not
related to the business acquired). The historical operations of
the Truk-Away Companies, the Jones Companies and Jahner are not
material to the Company's consolidated operations and financial
position and, therefore, the 1995 consolidated financial statements
have not been restated. In connection with these transactions, the
Company incurred an after tax charge totaling approximately $2.2
million relating to the pooling-of-interests.
Separate revenue and net income of the Company and the Pooled
Companies (as hereinafter defined) for certain periods prior to
combination are set forth in the table below. For purposes of such
table, the "Pooled Companies" include (i) with respect to any
period in 1995, only the Salinas Companies, (ii) with respect to
the three months ended March 31, 1996, the Salinas Companies, the
Truk-Away Companies, the Jones Companies and Jahner and (iii) with
respect to any other period in 1996, the Truk-Away Companies, the
Jones Companies and Jahner.
<TABLE>
<CAPTION>
Pooled
The Company Companies Combined
<S> <C> <C> <C>
Nine months ended
September 30, 1995
Revenues $147,880,343 $12,409,341 $160,289,684
Net income 17,776,381 618,273 18,394,654
Three months ended
September 30, 1995
Revenues 58,957,936 4,365,446 63,323,382
Net income 8,520,736 208,507 8,729,243
Three months ended
March 31, 1996
Revenues 62,674,983 6,905,515 69,580,498
Net income(loss) 6,186,392 (408,808) 5,777,584
Three months ended
June 30, 1996
Revenues 79,055,526 3,201,995 82,257,521
Net income (loss) 7,106,938 (17,787) 7,089,151
Six months ended
June 30, 1996
Revenues 145,791,006 6,047,013 151,838,019
Net income (loss) 13,232,559 (365,824) 12,866,735
</TABLE>
Certain of the above mentioned pooled entities were
partnerships, sole proprietorships or had elected to be treated as
Subchapter S Corporations for federal and state income tax
purposes. Therefore, those companies' income or loss is passed
through to their stockholders rather than being subjected to taxes
at the corporate level. The condensed consolidated financial
statements reflect provisions for income taxes on a pro forma basis
as if all of the pooled entities were liable for federal and state
income taxes as taxable corporate entities.
Note 3 - Capital Stock
On March 12, 1996, the Board of Directors approved a two-for-one stock
split of the Company's common stock to be effected in the
form of a 100% stock dividend. Such stock split was effected by
the distribution on June 18, 1996, of a dividend of one share of
the Company's common stock in respect of each share of common stock
that was outstanding on June 7, 1996, the record date established
for such distribution. All agreements concerning stock options,
convertible securities and other commitments payable in shares of
the Company's common stock were amended to provide for the issuance
of two shares of common stock for every one share that was issuable
prior to the stock split. An amount equal to the par value of the
common stock issued was transferred from additional paid-in capital
to the common stock account. The transfer has been reflected in
the condensed consolidated statement of changes in stockholders'
equity for the nine months ended September 30, 1996. All share and
per share data has been adjusted to give effect to the stock split.
Note 4 - Contingencies
While the Company carries a wide range of insurance coverage
for the protection of the Company's assets and operations, the
Company does not carry insurance coverage for environmental
liability, except as described in the following sentence. The
Company's insurance coverage for environmental liability is limited
to (i) contractor pollution liability insurance that relates to
certain environmental services provided by the Company and (ii)
certain other pollution liability insurance which is the equivalent
to self-insurance because under the terms thereof the Company is
required to fully reimburse the insurance company for any paid
claims. In the event uninsured losses occur, the Company's net
income and financial position could be materially adversely
affected.
On January 9, 1996, the Junker Landfill Trust sued the
Company, Junker Sanitation Services, Inc., and United Waste
Transfer, Inc., both of which are subsidiaries of the Company, and
approximately 800 other parties in the United States District Court
for the Western District of Wisconsin, Case No. 96C-19S, for the
contribution under the Comprehensive Environmental Response
Compensation and Liability Act ("CERCLA"), as well as state common
law, with respect to the Junker Landfill site in Hudson, Wisconsin.
By order entered July 19, 1996, the court approved a consent decree
which was signed by the Company and the others with respect to this
site. The Company's obligations under the consent decree are
secured by, and limited to, certain indemnification rights which
the Company has against the former owner of Junker Sanitation
Services, Inc.
On May 26, 1995 the Company sued Robert Foley and Matthew
Parzych in the United States District Court for the District of
Connecticut, Case No. 3:95-CV-985. The defendants sold stock in
certain Massachusetts corporations to the Company under an
agreement dated April 1, 1992 (the "1992 agreement"). In the suit
the Company seeks approximately $1,115,000 in cash and securities
from an escrow account and additional amounts from defendants by
reason of indemnity provisions contained in the 1992 agreement and
confirmed in an agreement dated January 28, 1994 (the "1994
agreement"). The defendants have counterclaimed against the
Company and its chief executive officer, seeking to invalidate the
1994 agreement primarily for alleged lack of consideration and
economic duress, and to receive alleged damages and costs. The
counterclaims for damages are primarily for alleged
misrepresentations by the Company in connection with the 1992
agreement, and were asserted by defendants notwithstanding
provisions in the 1994 agreement which generally released the
Company from all claims. The Company intends vigorously to pursue
its claims in this action and to seek dismissal of the
counterclaims. In the opinion of management, this claim should not
materially affect the financial position of the Company.
In July 1996 the Company filed suit against H.A.M. Sanitary
Landfill, Inc. and its shareholders. The suit is now pending in
the Circuit Court for Monroe County, West Virginia, Civil Action
No. 96-C-51. The Company, among other things, seeks to recover
$1.8 million in advances which the Company made in connection with
an agreement, since terminated, to purchase the H.A.M. Sanitary
Landfill in West Virginia from the defendants, and to recover
certain personal property. The defendants in September 1996 filed
a counterclaim against the Company and a subsidiary which seeks
compensatory and punitive damages for claims of alleged breach of
contract, breach of fiduciary duty under an alleged joint venture,
unjust enrichment and fraud. The Company will vigorously prosecute
its claim and defend against the counterclaim. In the opinion of
management, the counterclaim should not materially affect the
financial position of the Company.
In June 1996 Dale Lynch, Dennis Lynch and D.L. Lynch sued the
Company, its chief executive officer and a subsidiary of the
Company in the Circuit Court of Whitley County, Kentucky (Index No.
96 CI 00355). The subsidiary purchased the Tri-County landfill
from the plaintiffs in 1991. The suit primarily seeks
compensatory and punitive damages for alleged breach of contract
and for allegedly fraudulent representations in connection with
this purchase. The Company will vigorously defend this suit and
intends to file counterclaims for, among other things, compensatory
and punitive damages for breach of warranties and fraud. The
Company will also seek indemnification for breach of warranties.
In the opinion of management, this suit should not materially
affect the financial position of the Company.
The Company accrues the costs for closure and post-closure
monitoring over the life of its owned landfills and will pay out
these costs over the next thirty years. Major components of these
costs include closure cap construction, leachate treatment and
groundwater monitoring. The Company accrues these costs utilizing
engineering estimates based on current governmental regulations
regarding closure requirements. The Company estimates that the
aggregate liability for the closure, post-closure and remediation
costs of its landfills owned at September 30, 1996 will be
approximately $73.3 million. At September 30, 1996, the Company
has approximately $41.5 million of these costs accrued and,
therefore, has accrued approximately 57% of its estimated total
costs to date.
The Company monitors the availability of airspace at each of
its landfills and the need to obtain permit modifications for
approvals for expansion in order to continue operating these
landfills. In order to develop and operate a landfill, a
composting facility or transfer station, or other solid waste
management facility, the Company typically must go through several
governmental review processes and obtain one or more permits and
often zoning or other land use approvals. Once obtained, operating
permits generally must be periodically renewed and are subject to
modification and revocation by the issuing agency. There can be no
assurance that the Company will succeed in obtaining or maintaining
these permits, permit modifications or approvals.
Item 2 Management's discussion and analysis of financial
condition and results of operations.
The following discussion should be read in conjunction with
the unaudited Condensed Consolidated Financial Statements and
related Notes thereto of the Company included herein, the
Consolidated Financial Statements and related Notes thereto
included in the Company's 1995 Annual Report on Form 10-K, and the
Company's Current Report on Form 8-K referred to below. The
Company's consolidated balance sheet as of December 31, 1995,
included herein has been restated as described above. See Notes 1
and 2 of Notes to Unaudited Condensed Consolidated Financial
Statements, included in Part I-Item 1 of this Report. Such
restated balance sheet has been audited and filed as an Exhibit to
a Current Report on Form 8-K dated June 28, 1996, previously filed
by United Waste Systems, Inc.
The following discussion includes statements that are forward-looking
in nature. Whether such statements ultimately prove to be
accurate depends upon a variety of factors that may affect the
business and operations of the Company. Certain of these factors
are discussed under the caption Item 1 - "Business-Factors that May
Influence Future Results and Accuracy of Forward-Looking
Statements" included in the Company's 1995 Annual Report on Form
10-K. The information in such Annual Report under such caption is
incorporated by reference herein.
Introduction
The Company was formed in July 1989 to acquire and operate
businesses in the nonhazardous solid waste services industry and
since its formation through September 30, 1996, has completed 132
acquisitions, including 41 completed during 1995 and 54 in the
first nine months of 1996. The focus of the Company's acquisition
program at present is to capitalize on opportunities around its
existing operating regions that will create synergies and
efficiencies, as well as to selectively enter several new regions
annually. The Company may also selectively consider acquisitions
or consolidation opportunities involving other public companies or
large privately-held companies.
The acquisitions completed by the Company during the periods
discussed below include five that were accounted for as a pooling-of-interests.
(For certain information concerning such
acquisitions and the restatement of certain of the Company's
financial statements in connection therewith, see Note 2 of Notes
to Unaudited Condensed Consolidated Financial Statements included
in Part I-Item 1 of this Report). The other acquisitions completed
during such periods were accounted for as purchases and,
accordingly, the results of operations of the businesses acquired
in these acquisitions are included in the Company's financial
statements only from their respective dates of acquisition. In
view of the fact that the Company's operating results for 1996 and
1995 were impacted by these acquisitions that were accounted for as
purchases, the Company believes that the results of its operations
for 1996 and 1995 are not directly comparable.
General
The Company's revenues have been primarily attributable to (i)
collection revenues and (ii) fees (commonly referred to as "tipping
fees") charged to dispose of waste at the Company's landfills. The
table below shows for the periods indicated the percentage of the
Company's total revenues attributable to various sources.
<TABLE>
<CAPTION>
Nine Months Ended September 30,
1996 1995
<S> <C> <C>
Landfill operations(1) 30% 30%
Collection operations(2) 65 61
Waste reuse and reduction
programs 2 4
Other services 3 5
Total 100% 100%
Three Months Ended September 30,
1996 1995
Landfill operations(1) 32% 33%
Collection operations(2) 62 59
Waste reuse and reduction
programs 3 4
Other services 3 4
Total 100% 100%
</TABLE>
(1) Revenue from landfill operations primarily represent fees
charged to dispose of waste at the Company's landfills (including
fees charged to the Company's collection operations).
(2) Excludes the portion of collection revenues attributable to
disposal charges for solid waste collected by the Company and
disposed of at the Company's landfills.
In certain instances, the amount of revenues that a newly
acquired business contributes to the Company's revenues may be
significantly less than the revenues that such business had prior
to being acquired due to the elimination of intercompany revenues
resulting from consolidation with the Company.
A portion of the Company's revenues from waste reuse and
reduction programs is derived from the sale of recyclable waste
products. The resale prices of, and demand for, recyclable waste
products can vary significantly and be subject to changing market
conditions. Accordingly, the Company's revenues from such sales
may materially vary from period to period.
Landfill cost of operations primarily include direct and
indirect labor, the legal and administrative cost of ongoing
environmental compliance, certain landfill taxes, franchise fees or
host community fees, rental payments under leases with respect to
landfill sites that are not owned, landfill site maintenance,
depreciation and amortization expense, and accruals for closure and
post-closure expenses anticipated to be incurred in the future.
Certain direct landfill development costs, such as engineering,
upgrading, construction and permitting costs paid to outside
parties in respect of permits acquired or in the process of being
acquired, are capitalized and amortized based on consumed airspace.
All indirect landfill development costs, such as executive
salaries, general corporate overhead, public affairs and other
corporate services, are expensed as incurred. The Company believes
that the costs associated with the engineering, ownership and
operation of landfills will increase in the future as a result of
increasing federal, state and local regulation and a growing
community awareness of the landfill permitting process. Although
there can be no assurance, the Company believes that it generally
will be able to implement price increases sufficient to offset
these increased expenses.
Collection cost of operations includes direct and indirect
labor, insurance, fuel, equipment maintenance costs, tipping fees
paid to third party landfills and, with respect to the Company's
asbestos collection operations, transportation costs.
Selling, general and administrative expense ("SG&A") includes
management salaries, clerical and administrative overhead, costs
associated with the Company's commercial and industrial sales force
and community relations expenses. SG&A also includes expenses
associated with completing acquisitions that are accounted for as
pooling-of-interests, since such expenses are not capitalized.
The Company capitalizes engineering, legal, accounting and
other direct costs that are incurred in connection with potential
acquisitions. The Company, however, routinely evaluates such
capitalized costs and charges to expense those relating to
abandoned acquisitions. Indirect acquisition costs, such as
executive salaries, general corporate overhead, public affairs and
other corporate services, are expensed as incurred.
The Company estimates landfill closure and post-closure
reserves based on an analysis of the requirements of the
regulations under Subtitle D of the Resource Conservation and
Recovery Act of 1976 and state laws and regulations. Since the
annual charge for each landfill is determined based upon the total
estimated unaccrued landfill closure and post-closure costs and the
estimated portion of remaining airspace filled during the year, the
provision may vary from period to period, as the volume of waste
disposed of in the landfill increases or decreases, expansions and
new permits change the life of the landfill and other circumstances
require management to reevaluate and to change such estimates. The
Company estimates that the aggregate liability for the remediation,
closure and post-closure costs of its facilities owned at September
30, 1996 will be approximately $73.3 million. At September 30,
1996, reserves for landfill closure and post-closure costs
(including reserves assumed through acquisitions) were
approximately $41.5 million, and the balance will be accrued over
the remaining operating lives of the landfills.
Results of Operations
Nine months ended September 30, 1996 and 1995
Revenues. Revenues for the nine months ended September 30,
1996 were $241.9 million, representing an increase of 50.9% over
revenues for the nine months ended September 30, 1995 of $160.3
million. Of this increase, approximately 42.2 percentage points
were due to the revenues attributable to (i) the businesses
acquired by the Company subsequent to September 30, 1995 and (ii)
businesses that were acquired during the first nine months of 1995
and thus were included in the Company's results for the first nine
months of 1995 for only a portion of the period and in the
Company's results for the first nine months of 1996 for the full
period. The balance of this increase was due to an increase in
1996 in volume of waste received by the Company's operations that
were owned by the Company throughout both periods (approximately
4.5 percentage points) and in prices charged for services
(approximately 4.2 percentage points).
Cost of Operations. Cost of operations for the first nine
months of 1996 was $149.6 million compared with $99.2 million for
the first nine months of 1995. As a percentage of revenues, cost
of operations was not materially different during these periods
(61.8% during the first nine months of 1996 and 61.9% during the
first nine months of 1995).
Selling, General and Administrative Expense. SG&A was $38.8
million during the nine months ended September 30, 1996 compared
with $24.9 million during the nine months ended September 30, 1995,
and as a percentage of revenues was 16.0% during the nine months
ended September 30, 1996 compared with 15.5% during the nine months
ended September 30, 1995. This increase in SG&A as a percentage of
revenues reflected the fact that expenses related to acquisitions
accounted for as pooling-of-interests (of which there were four in
1996 and one in 1995) were higher in the first nine months of 1996
than in the first nine months of 1995 ($4.4 million compared with
$900,000). See Note 2 of Notes to Unaudited Condensed Consolidated
Financial Statements included in Part I-Item 1 of this Report.
Excluding such expenses, SG&A as a percentage of revenues decreased
to 14.2% during the nine months ended September 30, 1996, from
15.0% during the nine months ended September 30, 1995. This
decrease primarily reflected the fact that the revenue growth
attributable to acquisitions was achieved without a commensurate
increase in senior management expense or corporate overhead.
Interest Expense. Interest expense increased to $11.1 million
during the nine months ended September 30, 1996 from $6.9 million
during the nine months ended September 30, 1995. This increase
primarily reflected the fact that the Company's indebtedness
increased subsequent to the nine months ended September 30, 1995,
primarily as a result of the completion of acquisitions and the
issuance of $150 million in Convertible Subordinated Notes (as
described under "-Liquidity and Capital Resources"). Interest
capitalized as a component of construction projects during the nine
months ended September 30, 1996 and 1995 amounted to approximately
$1.2 million and $895,000, respectively.
Other Expense (Income), Net. Other expense, net, was $1.1
million in the nine months ended September 30, 1996 (compared with
other income, net, of $712,000 in the nine months ended September
30, 1995). This increase in other expense, net, was primarily
attributable to a $2.0 million charge resulting from the sale of
the Company's transfer station in Pennsylvania.
Income Taxes. Income taxes increased to $17.5 million, or an
effective rate of 42.3%, during the nine months ended September 30,
1996 from $11.6 million, or an effective rate of 38.7%, during the
nine months ended September 30, 1995. The increase in the
effective rate was primarily due to the fact that certain
transaction expenses relating to acquisitions accounted for as
pooling-of-interests are not deductible in determining taxable
income and such expenses were higher in 1996 than in 1995.
Results of Operations
Three months ended September 30, 1996 and 1995
Revenues. Revenues for the three months ended September 30,
1996 were $90.0 million, representing an increase of 42.2% over
revenues for the three months ended September 30, 1995 of $63.3
million. Of this increase, approximately 33.2 percentage points
were due to the revenues attributable to (i) the businesses
acquired by the Company subsequent to September 30, 1995 and (ii)
businesses that were acquired during the third quarter of 1995 and
thus were included in the Company's third quarter 1995 results for
only a portion of the quarter and in the Company's third quarter
1996 results for a full quarter. The balance of this increase in
1996 was due to an increase in volume of waste received by the
Company's operations that were owned by the Company throughout both
periods (approximately 4.5 percentage points) and in prices charged
for services (approximately 4.5 percentage points).
Cost of Operations. Cost of operations for the three months
ended September 30, 1996 was $53.1 million compared with $37.2
million for the three months ended September 30, 1995. As a
percentage of revenues, cost of operations was 59.0% during the
three months ended September 30, 1996 and 58.7% during the three
months ended September 30, 1995. This increase in cost of
operations as a percentage of revenues was primarily attributable
to the increase in collection revenues as a percentage of total
revenues, since collection operations generally have lower margins
than landfill operations.
Selling, General and Administrative Expense. SG&A was $14.0
million during the three months ended September 30, 1996 compared
with $9.7 million during the three months ended September 30, 1995,
and as a percentage of revenues was 15.6% during the three months
ended September 30, 1996 compared with 15.4% during the three
months ended September 30, 1995. This increase in SG&A as a
percentage of revenues reflected the fact that expenses related to
acquisitions accounted for as pooling-of-interests (of which there
were three in the third quarter of 1996 and one in the third
quarter of 1995) were higher in the third quarter of 1996 than in
the third quarter of 1995 ($2.2 million compared with $900,000).
See Note 2 of Notes to Unaudited Condensed Consolidated Financial
Statements included in Part I-Item 1 of this Report. Excluding
such expenses, SG&A as a percentage of revenues decreased to 13.1%
during the three months ended September 30, 1996, from 13.9% during
the three months ended September 30, 1995. This decrease primarily
reflected the fact that the revenue growth attributable to
acquisitions was achieved without a commensurate increase in senior
management expense or corporate overhead.
Interest Expense. Interest expense increased to $3.9 million
during the three months ended September 30, 1996 from $2.4 million
during the three months ended September 30, 1995. This increase
primarily reflected the fact that the Company's indebtedness
increased subsequent to September 30, 1995, primarily as a result
of the issuance of $150 million in Convertible Subordinated Notes
(as described under "-Liquidity and Capital Resources") and the
completion of acquisitions. Interest capitalized as a component of
construction projects during the three months ended September 30,
1996 and 1995 amounted to approximately $763,000 and $286,000,
respectively.
Other Expense (Income), Net. Other income, net, was $686,000
during the three months ended September 30, 1996 compared with
other income, net, of $293,000 during the three months ended
September 30, 1995. This increase in other income, net, was
primarily attributable to interest income on cash from the
Company's issuance of $150 million of Convertible Subordinated
Notes in June 1996.
Income Taxes. Income taxes increased to $8.3 million, or an
effective rate of 42.1%, during the three months ended September
30, 1996 from $5.5 million, or an effective rate of 38.9%, during
the three months ended September 30, 1995. The increase in the
effective rate was primarily due to the fact that certain
transaction expenses relating to acquisitions accounted for as
pooling-of-interests are not deductible in determining taxable
income and such expenses were higher in the third quarter of 1996
than in the third quarter of 1995.
Liquidity and Capital Resources
The Company (i) has used, and expects to continue using, a
substantial amount of cash generated from operations to fund
acquisitions, thereby reducing its current assets and (ii) in
connection with acquisitions and the financing of machinery and
equipment, the Company has assumed or incurred indebtedness with
relatively short-term repayment schedules, thereby increasing its
current liabilities. As a result of the foregoing financing
practices, the Company has had, and expects to continue to have,
low levels of working capital or working capital deficiencies.
Although the Company had working capital of $23.7 million at
September 30, 1996, this primarily reflected the fact that (as
described below) the Company issued $150 million of Convertible
Subordinated Notes in June 1996 and has not yet utilized a portion
of the net proceeds therefrom. The Company expects that it will
use these proceeds primarily to fund acquisitions and capital
expenditures and that, upon using such proceeds, will again
maintain low levels of working capital or working capital
deficiencies. The Company believes that its current and expected
financing practices relating to working capital will not impair its
ability to meet its ongoing cash requirements and continue its
acquisition program, although there can be no assurance of this.
During the nine months ended September 30, 1996, the Company
generated cash from operations of approximately $56.8 million and
had net cash from financing activities of approximately $100.6
million. The Company used these funds generated from operating and
financing activities to complete business acquisitions of
approximately $88.2 million and for capital expenditures of
approximately $41.0 million. These acquisitions and capital
expenditures accounted for the increase in property and equipment,
and intangible assets, at September 30, 1996 compared with such
amounts at December 31, 1995.
The Company's $215 million, three year, secured revolving
credit facility due August 1998 (the "Credit Facility") bears
interest at a rate per annum equal to the Eurodollar Rate (Reserved
Adjusted)(as defined in the loan agreement providing for the Credit
Facility) applicable to each interest period plus .75% to 1.75% per
annum or the Alternate Reference Rate (as so defined) from time to
time in effect plus 0% to .25% per annum. The Credit Facility is
secured by the stock of the Company's subsidiaries, restricts the
Company from granting other liens on its assets (subject to certain
limited exceptions), and requires the Company to comply with
certain covenants including, but not limited to, maintenance of
certain financial ratios, limitation on additional indebtedness,
limitation on capital expenditures and a prohibition on the
Company's payments of cash dividends on its capital stock. The
Credit Facility also currently requires that the consent of the
lenders be obtained in order for the Company to make an acquisition
that provides for an aggregate cash purchase price of $15 million
or more. In addition, the Credit Facility prohibits the Company
from using more than $10 million of its cash to secure closure and
post-closure obligations that the Company may have relating to its
landfills. Under the terms of the Credit Facility, an event of
default would occur should two or more of the individuals currently
serving as executive officers of the Company cease to be employed
by the Company. The Company used a portion of the net proceeds
from the Convertible Subordinated Notes that it issued in June 1996
(as described below) to repay the outstanding indebtedness under
the Credit Facility. Consequently, there was no outstanding
indebtedness under the Credit Facility at September 30, 1996,
compared with $41.8 million at December 31, 1995.
The Credit Facility also allows the Company to obtain up to
$65 million in letters of credit. These letters of credit may be
used, among other purposes, to secure or support closure
obligations that the Company may have relating to its landfills.
On September 30, 1996, the face amount of outstanding letters of
credit issued pursuant to the Credit Facility was approximately
$59.3 million. The aggregate amount that the Company is permitted
to borrow under the Credit Facility is reduced by the aggregate
face amount of all outstanding letters of credit issued thereunder.
In June 1996, the Company issued $150 million principal amount
of 4-1/2% Convertible Subordinated Notes due June 1, 2001 (the
"Convertible Notes"). The Convertible Notes bear interest at a
fixed rate of 4-1/2% per annum, payable semi-annually. The
Convertible Notes are convertible into Common Stock of the Company
at a conversion price of $32.50 per share. The Convertible Notes
are unsecured obligations of United Waste Systems, Inc. and are
subordinated to all existing and future Senior Indebtedness (as
defined in the indenture relating to the Convertible Notes) of
United Waste Systems, Inc. and are effectively subordinated to all
indebtedness and other liabilities of the subsidiaries of United
Waste Systems, Inc. The issuance of the Convertible Notes and the
receipt of the net proceeds therefrom was the primary reason for
the increase in cash and cash equivalents and long-term debt at
September 30, 1996 compared with December 31, 1995.
Set forth is a discussion of the Company's primary ongoing
cash requirements and the means by which it expects to meet these
requirements in the future.
Operating Activities. The Company anticipates that for the
foreseeable future, cash generated from operating activities will
be sufficient to provide the cash required for operating
activities.
Capital Expenditures. The Company expects to make capital
expenditures on an ongoing basis for improvements to, and expansion
of, its landfills and for equipment purchases. The Company
estimates that the capital expenditures that will be required in
respect of the existing operations of the Company will be in the
range of $18 million to $20 million during the last three months of
1996 and $65 to $70 million in 1997. The Company expects that it
will fund such estimated capital expenditures in respect of its
existing operations from available cash on hand and cash generated
from operations, supplemented, if required, by borrowings available
under the Credit Facility. In addition, the Company expects that
it will be required to make capital expenditures in respect of new
operations that it may hereafter acquire. The Company cannot
quantify at this time the amount of such capital expenditures.
Acquisitions. An element of the Company's strategy is to
continue to acquire additional solid waste companies. The Company
expects to pay for future acquisitions using cash, capital stock,
assumption of indebtedness and/or notes, ongoing royalties and
contingent payments. The Company expects that any cash required
for future acquisitions will be provided by a combination of
available cash on hand, cash generated from operations, borrowings
available under the Credit Facility and future debt or equity
financing. There can be no assurance, however, that any such
future debt or equity financing will be available or, if available,
will be available on terms satisfactory to the Company.
In order to minimize cash required to complete acquisitions
and adequately secure indemnity obligations, the Company frequently
structures its landfill acquisitions in a manner such that a
portion of the purchase consideration is deferred, contingent or
payable in the form of future royalties. The Company expects that
deferred or contingent payments and royalties that may become
payable in respect of its completed acquisitions will be funded
from available cash on hand and cash generated from operations,
supplemented, if required, by borrowings available under the Credit
Facility.
Debt Repayment. At September 30, 1996, the Company had debt
and capital lease obligations of approximately $275.5 million. The
Company will be obligated to retire approximately $1.8 million and
$2.5 million of indebtedness during the remainder of 1996 and in
1997, respectively. The Company plans to meet such obligations
from available cash on hand, cash generated from operations,
borrowings available under the Credit Facility and/or additional
financing.
Financial Assurance. The Company is required to provide
financial assurance to various governmental and regulatory bodies
for closure, post-closure and remediation obligations. The Company
provides for these financial assurance obligations primarily
through the issuance of letters of credit obtained under the Credit
Facility, as well as through surety bonds and irrevocable trust
funds. As of September 30, 1996, the aggregate amount of these
financial assurance obligations was $39.4 million, $30.2 million of
which is being satisfied by letters of credit obtained under the
Credit Facility. Under the Subtitle D Regulations, new financial
assurance requirements become effective on or before April 9, 1997.
The Company estimates that when such regulations become effective
the financial assurance obligations that it will be required to
provide in order to continue certain of its existing landfill
operations will increase by approximately $33.9 million to
approximately $73.3 million. The Company plans to meet such
increased financial assurance obligations through additional
letters of credit obtained under existing or new credit facilities
and, where permitted, insurance policies.
Capital Expenditures
The Company, in accordance with generally accepted accounting
principles, capitalizes certain expenditures and advances relating
to its acquisitions, pending acquisitions and landfill development
and expansion projects. Indirect acquisitions costs, such as
executive salaries, general corporate overhead, public affairs and
other corporate services, are expensed as incurred. The Company's
policy is to charge against earnings any unamortized capitalized
expenditures or advances (net of any portion thereof that the
Company estimates will be recoverable, through sale or otherwise)
relating to any operation that is permanently shut down, any
pending acquisition that is not consummated, and any landfill
development or expansion project that is not successfully
completed. The Company also has a substantial investment in its
permitted landfills. If any of the Company's landfills were to
lose their permits, the Company would charge against earnings the
unamortized portion of its investment and any necessary
acceleration of closure and post closure accruals. The Company has
capitalized expenditures with respect to substantially all of its
other operations. There can be no assurance that the Company will
not be required in future periods to incur charges against earnings
relating to these capitalized expenditures in excess of the
scheduled amortizations.
Inflation and Prevailing Economic Condition
To date, inflation has not had a significant impact on the
Company's operations. The Company generally enters into long-term
contracts only if such contracts include provisions for price
escalations based on a price index.
Seasonality
The Company's revenues tend to be somewhat lower in the winter
months. This is generally reflected in the Company's first quarter
results and may also be reflected in its fourth quarter results.
This is primarily attributable to the fact that (i) the volume of
waste relating to construction and demolition activities and
activities relating to the remediation of contaminated soils tends
to increase in the spring and summer months and (ii) the volume of
waste relating to industrial and residential waste in certain of
the regions where the Company operates tends to decrease during the
winter months. Particularly harsh weather conditions may result in
the temporary suspension of certain of the Company's operations and
could adversely affect the Company's overall results of operations.
PART II OTHER INFORMATION
Item 1. Legal Proceedings
In July 1996 the Company filed suit against H.A.M.
Sanitary Landfill, Inc. and its shareholders. The suit is now
pending in the Circuit Court for Monroe County, West Virginia,
Civil Action No. 96-C-51. The Company, among other things, seeks
to recover $1.8 million in advances which the Company made in
connection with an agreement, since terminated, to purchase the
H.A.M. Sanitary Landfill in West Virginia from the defendants, and
to recover certain personal property. The defendants in September
1996 filed a counterclaim against the Company and a subsidiary
which seeks compensatory and punitive damages for claims of alleged
breach of contract, breach of fiduciary duty under an alleged joint
venture, unjust enrichment and fraud. The Company will vigorously
prosecute its claim and defend against the counterclaim. In the
opinion of management, the counterclaim should not materially
affect the financial position of the Company.
In June 1996 Dale Lynch, Dennis Lynch and D.L. Lynch sued
the Company, its chief executive officer and a subsidiary of the
Company in the Circuit Court of Whitley County, Kentucky (Index No.
96 CI 00355). The subsidiary purchased the Tri-County landfill
from the plaintiffs in 1991. The suit primarily seeks
compensatory and punitive damages for alleged breach of contract
and for allegedly fraudulent representations in connection with
this purchase. The Company will vigorously defend this suit and
intends to file counterclaims for, among other things, compensatory
and punitive damages for breach of warranties and fraud. The
Company will also seek indemnification for breach of warranties.
In the opinion of management, this suit should not materially
affect the financial position of the Company.
Item 6 Exhibits and Reports on Form 8-K
(a) Exhibits:
(1) Exhibit 3.1 - Amended and Restated
Certificate of Incorporation dated October 31,
1991, as amended by (i) Certificate of Increase of
Designated Number of Shares of Series B Cumulative
Convertible Preferred stock dated March 31, 1992,
(ii) Certificate of Correction to Amended and
Restated Certificate of Incorporation dated April
30, 1992, (iii) Certificate of Amendment to
Certificate of Incorporation dated October 9,
1992, (iv) Certificate of Change of Location of
Registered Office and Registered Agent dated
January 28, 1993, (v) Certificate of Amendment to
Certificate of Incorporation dated August 31,
1993, and (vi) Certificate of Amendment to
Certificate Incorporation dated June 12, 1996
(incorporated by reference to Exhibit 4.1 to the
Registration Statement on Form S-8 Commission File
No. 333-14489).
(2) Exhibit 4.1 - Indenture dated June 5, 1996 between
the Registrant and Bankers Trust Company, as
Trustee (This is the same agreement previously
filed as Exhibit 4.1 to Registrant's Report on
Form 10-Q for the quarterly period ended June 30,
1996, except that the definition of "Senior
Indebtedness" in Section 1.1 has been modified to
correct a typographical error).
(3) Exhibit 11 - Computation of earnings per share
(4) Exhibit 27.1 - Financial Data Schedule
(5) Exhibit 27.2 - Restated Financial Data Schedule
(6) Exhibit 27.3 - Restated Financial Data Schedule
(7) Exhibit 99 - Information that appears in the Company's Report
on Form 10-K for the year ended December 31, 1995, under
Item 1 "Business Factors that May Influence Future
Results and Accuracy of Forward-Looking Statements."
(b) Reports on Form 8-K:
(1) Form 8-K - dated June 28, 1996, Items 5 and 7
(included supplemental consolidated financial
statements of United Waste Systems, Inc.
filed as Exhibit 99.1).
SIGNATURES
Pursuant to the requirements of the Securities and
Exchange Act of 1934, the registrant has duly caused this report
to be signed on its behalf by the undersigned hereunto duly
authorized.
UNITED WASTE SYSTEMS, INC.
Dated: November 14, 1996 By: /s/Michael J. Nolan
Michael J. Nolan
Chief Financial Officer
(Principal Financial Officer)
Dated: November 14, 1996 By: /s/Sandra E. Welwood
Sandra E. Welwood
Vice President, Controller
(Principal Accounting Officer)
UNITED WASTE SYSTEMS, INC.
ISSUER
TO
BANKERS TRUST COMPANY
TRUSTEE
________________
INDENTURE
Dated as of June 5, 1996
________________
U.S.$150,000,000
4-1/2% Convertible Subordinated Notes
Due June 1, 2001
TABLE OF CONTENTS
___________
Page
RECITALS OF THE COMPANY. . . . . . . . . . . . . . . 1
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION . . . . . . . . 2
SECTION 1.1. Definitions . . . . . . . . . . . . . 2
Act . . . . . . . . . . . . . . . . . . . . . . 2
Additional Amounts. . . . . . . . . . . . . . . 2
Affiliate . . . . . . . . . . . . . . . . . . . 2
Applicable Procedures . . . . . . . . . . . . . 2
Authenticating Agent" . . . . . . . . . . . . . 3
Authorized Newspaper. . . . . . . . . . . . . . 3
Bearer Additional Amounts . . . . . . . . . . . 3
Bearer Security . . . . . . . . . . . . . . . . 3
Board of Directors. . . . . . . . . . . . . . . 3
Board Resolution. . . . . . . . . . . . . . . . 3
Business Day. . . . . . . . . . . . . . . . . . 3
CEDEL . . . . . . . . . . . . . . . . . . . . . 3
Closing Price Per Share . . . . . . . . . . . . 3
Code. . . . . . . . . . . . . . . . . . . . . . 4
Commission. . . . . . . . . . . . . . . . . . . 4
Common Depositary . . . . . . . . . . . . . . . 4
Common Stock. . . . . . . . . . . . . . . . . . 4
common stock. . . . . . . . . . . . . . . . . . 4
Company . . . . . . . . . . . . . . . . . . . . 4
Company Request . . . . . . . . . . . . . . . . 4
Company Order . . . . . . . . . . . . . . . . . 4
Constituent Person. . . . . . . . . . . . . . . 4
Conversion Agent. . . . . . . . . . . . . . . . 5
Conversion Price. . . . . . . . . . . . . . . . 5
Corporate Trust Office. . . . . . . . . . . . . 5
corporation . . . . . . . . . . . . . . . . . . 5
coupon. . . . . . . . . . . . . . . . . . . . . 5
Defaulted Interest. . . . . . . . . . . . . . . 5
Definitive Security . . . . . . . . . . . . . . 5
Depositary. . . . . . . . . . . . . . . . . . . 5
Determination Notice. . . . . . . . . . . . . . 5
Dollar. . . . . . . . . . . . . . . . . . . . . 5
U.S.$ . . . . . . . . . . . . . . . . . . . . . 5
EUROCLEAR . . . . . . . . . . . . . . . . . . . 5
Event of Default. . . . . . . . . . . . . . . . 5
Note: This table of contents shall not, for any purpose, be
deemed to be a part of the Indenture.
Exchange Act. . . . . . . . . . . . . . . . . . 5
Exchange Date . . . . . . . . . . . . . . . . . 5
Holder. . . . . . . . . . . . . . . . . . . . . 6
Indenture . . . . . . . . . . . . . . . . . . . 6
Interest Payment Date . . . . . . . . . . . . . 6
Liquidated Damages. . . . . . . . . . . . . . . 6
Maturity. . . . . . . . . . . . . . . . . . . . 6
Non-electing Share. . . . . . . . . . . . . . . 6
Officers' Certificate . . . . . . . . . . . . . 6
Opinion of Counsel. . . . . . . . . . . . . . . 6
Outstanding . . . . . . . . . . . . . . . . . . 6
Paying Agent. . . . . . . . . . . . . . . . . . 7
Person. . . . . . . . . . . . . . . . . . . . . 7
Place of Conversion . . . . . . . . . . . . . . 7
Place of Payment. . . . . . . . . . . . . . . . 7
Predecessor Security. . . . . . . . . . . . . . 7
Record Date . . . . . . . . . . . . . . . . . . 8
Redemption Date . . . . . . . . . . . . . . . . 8
Redemption Price. . . . . . . . . . . . . . . . 8
Registered Security . . . . . . . . . . . . . . 8
Registration Default. . . . . . . . . . . . . . 8
Registration Rights Agreement . . . . . . . . . 8
Regular Record Date . . . . . . . . . . . . . . 8
Repurchase Date . . . . . . . . . . . . . . . . 8
Repurchase Price. . . . . . . . . . . . . . . . 8
Responsible Officer . . . . . . . . . . . . . . 8
Restricted Security . . . . . . . . . . . . . . 8
Rule 144A Information . . . . . . . . . . . . . 8
Securities. . . . . . . . . . . . . . . . . . . 9
Securities Act. . . . . . . . . . . . . . . . . 9
Security Register . . . . . . . . . . . . . . . 9
Security Registrar. . . . . . . . . . . . . . . 9
Senior Indebtedness . . . . . . . . . . . . . . 9
Shelf Registration Statement. . . . . . . . . . 9
Special Record Date . . . . . . . . . . . . . . 10
Stated Maturity . . . . . . . . . . . . . . . . 10
Subsidiary. . . . . . . . . . . . . . . . . . . 10
Tax Affected Security . . . . . . . . . . . . . 10
Tax Law Change. . . . . . . . . . . . . . . . . 10
Temporary Global Bearer Security. . . . . . . . 10
Trading Days. . . . . . . . . . . . . . . . . . 10
Transfer Agent. . . . . . . . . . . . . . . . . 10
Trustee . . . . . . . . . . . . . . . . . . . . 11
Trust Indenture Act . . . . . . . . . . . . . . 11
United States . . . . . . . . . . . . . . . . . 11
United States person. . . . . . . . . . . . . . 11
Vice President. . . . . . . . . . . . . . . . . 11
Western Europe. . . . . . . . . . . . . . . . . 11
SECTION 1.2. Compliance Certificates and
Opinions. . . . . . . . . . . . . . . 11
Note: This table of contents shall not, for any purpose, be
deemed to be a part of the Indenture.
SECTION 1.3. Form of Documents Delivered to the
Trustee . . . . . . . . . . . . . . . 12
SECTION 1.4. Acts of Holders of Securities . . . . 13
SECTION 1.5. Notices, Etc., to Trustee and
Company . . . . . . . . . . . . . . . 14
SECTION 1.6. Notice to Holders of Securities;
Waiver. . . . . . . . . . . . . . . . 15
SECTION 1.7. The Application of Trust Indenture
Act . . . . . . . . . . . . . . . . . 16
SECTION 1.8. Effect of Headings and Table of
Contents. . . . . . . . . . . . . . . 16
SECTION 1.9. Successors and Assigns. . . . . . . . 17
SECTION 1.10. Separability Clause . . . . . . . . . 17
SECTION 1.11. Benefits of Indenture . . . . . . . . 17
SECTION 1.12. Governing Law . . . . . . . . . . . . 17
SECTION 1.13. Legal Holidays. . . . . . . . . . . . 17
Note: This table of contents shall not, for any purpose, be
deemed to be a part of the Indenture.
ARTICLE TWO
SECURITY FORMS . . . . . . . . . . 18
SECTION 2.1. Forms Generally . . . . . . . . . . . 18
SECTION 2.2. Forms of Securities . . . . . . . . . 19
SECTION 2.3. Form of Coupon. . . . . . . . . . . . 54
SECTION 2.4. Form of Certificate of
Authentication. . . . . . . . . . . . 55
SECTION 2.5. Form of Conversion Notice . . . . . . 55
SECTION 2.6. Legend on Restricted Securities . . . 58
ARTICLE THREE
THE SECURITIES . . . . . . . . . . 59
SECTION 3.1. Title and Terms . . . . . . . . . . . 59
SECTION 3.2. Denominations . . . . . . . . . . . . 60
SECTION 3.3. Execution, Authentication, Delivery
and Dating. . . . . . . . . . . . . . . . . . . 60
SECTION 3.4. Temporary Global Bearer Security. . . 61
SECTION 3.5. Registration, Registration of
Transfer and
Exchange; Restrictions on Transfer . . . 64
SECTION 3.6. Mutilated, Destroyed, Lost or
Stolen Securities and Coupons . . . . 69
SECTION 3.7. Payment of Interest; Interest
Rights Preserved. . . . . . . . . . . 70
SECTION 3.8. Persons Deemed Owners . . . . . . . . 72
SECTION 3.9. Cancellation. . . . . . . . . . . . . 73
SECTION 3.10. Computation of Interest . . . . . . . 73
SECTION 3.11. Form of Certification . . . . . . . . 73
SECTION 3.12. CUSIP Numbers . . . . . . . . . . . . 75
SECTION 3.13. Notification of Withholding.. . . . . 75
ARTICLE FOUR
SATISFACTION AND DISCHARGE . . . . . . . 76
SECTION 4.1. Satisfaction and Discharge of
Indenture . . . . . . . . . . . . . . 76
SECTION 4.2. Application of Trust Money. . . . . . 77
ARTICLE FIVE
REMEDIES. . . . . . . . . . . . 79
SECTION 5.1. Events of Default . . . . . . . . . . 79
SECTION 5.2. Acceleration of Maturity;
Rescission and Annulment. . . . . . . 80
Note: This table of contents shall not, for any purpose, be
deemed to be a part of the Indenture.
SECTION 5.3. Collection of Indebtedness and
Suits for Enforcement by Trustee. . . 81
SECTION 5.4. Trustee May File Proofs of Claim. . . 82
SECTION 5.5. Trustee May Enforce Claims Without
Possession
of Securities or Coupons . . . . . . . . 83
SECTION 5.6. Application of Money Collected. . . . 83
SECTION 5.7. Limitation on Suits . . . . . . . . . 84
SECTION 5.8. Unconditional Right of
Holders to Receive
Principal, Premium and
Interest and to Convert . . . . . . . 85
SECTION 5.9. Restoration of Rights and Remedies. . 85
SECTION 5.10. Rights and Remedies Cumulative. . . . 85
SECTION 5.11. Delay or Omission Not Waiver. . . . . 86
SECTION 5.12. Control by Holders of Securities. . . 86
SECTION 5.13. Waiver of Past Defaults . . . . . . . 86
SECTION 5.14. Undertaking for Costs . . . . . . . . 87
SECTION 5.15. Waiver of Stay, Usury or Extension
Laws. . . . . . . . . . . . . . . . . 87
ARTICLE SIX
THE TRUSTEE. . . . . . . . . . . 88
SECTION 6.1. Certain Duties and
Responsibilities. . . . . . . . . . . 88
SECTION 6.2. Notice of Defaults. . . . . . . . . . 89
SECTION 6.3. Certain Rights of Trustee . . . . . . 89
SECTION 6.4. Not Responsible for Recitals or
Issuance of Securities. . . . . . . . 91
SECTION 6.5. May Hold Securities, Act as Trustee
Under
Other Indentures . . . . . . . . . . . . 91
SECTION 6.6. Money Held in Trust . . . . . . . . . 91
SECTION 6.7. Compensation and Reimbursement. . . . 91
SECTION 6.8. Corporate Trustee Required;
Eligibility . . . . . . . . . . . . . . . . . . 92
SECTION 6.9. Resignation and Removal;
Appointment of Successor. . . . . . . . . . . . 93
SECTION 6.10. Acceptance of Appointment by
Successor . . . . . . . . . . . . . . 94
SECTION 6.11. Merger, Conversion, Consolidation
or
Succession to Business . . . . . . . . . 94
SECTION 6.12. Authenticating Agents . . . . . . . . 95
Note: This table of contents shall not, for any purpose, be
deemed to be a part of the Indenture.
ARTICLE SEVEN
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE. 97
SECTION 7.1. Company May Consolidate, Etc., Only
on Certain Terms. . . . . . . . . . . 97
SECTION 7.2. Successor Substituted . . . . . . . . 98
ARTICLE EIGHT
SUPPLEMENTAL INDENTURES. . . . . . . . 99
SECTION 8.1. Supplemental Indentures
Without Consent of
Holders of Securities or
Coupons . . . . . . . . . . . . . . . 99
SECTION 8.2. Supplemental Indentures
with Consent of Holders
of Securities . . . . . . . . . . . .100
SECTION 8.3. Execution of Supplemental
Indentures. . . . . . . . . . . . . .101
SECTION 8.4. Effect of Supplemental Indentures . .102
SECTION 8.5. Reference in Securities to
Supplemental Indentures . . . . . . . . . . . .102
SECTION 8.6. Notice of Supplemental Indentures . .102
ARTICLE NINE
MEETINGS OF HOLDERS OF SECURITIES . . . . .103
SECTION 9.1. Purposes for Which Meetings May Be
Called. . . . . . . . . . . . . . . . . . . . .103
SECTION 9.2. Call, Notice and Place of Meetings. .103
SECTION 9.3. Persons Entitled to Vote at
Meetings. . . . . . . . . . . . . . . . . . . .103
SECTION 9.4. Quorum; Action. . . . . . . . . . . .104
SECTION 9.5. Determination of Voting
Rights; Conduct and
Adjournment of Meetings . . . . . . .104
SECTION 9.6. Counting Votes and Recording Action
of Meetings . . . . . . . . . . . . . . . . . .105
ARTICLE TEN
COVENANTS . . . . . . . . . . .107
SECTION 10.1. Payment of Principal, Premium and
Interest. . . . . . . . . . . . . . . . . . . .107
SECTION 10.2. Maintenance of Offices or Agencies. .107
SECTION 10.3. Money for Security Payments to Be
Held in Trust . . . . . . . . . . . . . . . . .109
Note: This table of contents shall not, for any purpose, be
deemed to be a part of the Indenture.
SECTION 10.4. Additional Amounts and Bearer
Additional Amounts. . . . . . . . . . . . . . .110
SECTION 10.5. Existence . . . . . . . . . . . . . .111
SECTION 10.6. Maintenance of Properties . . . . . .111
SECTION 10.7. Payment of Taxes and Other Claims . .111
SECTION 10.8. Registration and Listing. . . . . . .112
SECTION 10.9. Statement by Officers as to
Default . . . . . . . . . . . . . . . . . . . .112
SECTION 10.10. Delivery of Certain Information . . .112
SECTION 10.11. Resale of Certain Securities;
Reporting Issuer. . . . . . . . . . . . . . . .113
SECTION 10.12. Registration Rights . . . . . . . . .113
SECTION 10.13. Waiver of Certain Covenants . . . . .115
ARTICLE ELEVEN
REDEMPTION OF SECURITIES. . . . . . . .116
SECTION 11.1. Right of Redemption . . . . . . . . .116
SECTION 11.2. Applicability of Article. . . . . . .116
SECTION 11.3. Election to Redeem; Notice to
Trustee . . . . . . . . . . . . . . .116
SECTION 11.4. Selection by Trustee of Securities
to Be Redeemed. . . . . . . . . . . .116
SECTION 11.5. Notice of Redemption. . . . . . . . .117
SECTION 11.6. Deposit of Redemption Price . . . . .118
SECTION 11.7. Securities Payable on Redemption
Date. . . . . . . . . . . . . . . . .119
SECTION 11.8. Registered Securities Redeemed in
Part. . . . . . . . . . . . . . . . .120
Note: This table of contents shall not, for any purpose, be
deemed to be a part of the Indenture.<PAGE>
ARTICLE TWELVE
CONVERSION OF SECURITIES. . . . . . . .121
SECTION 12.1. Conversion Privilege and Conversion
Price . . . . . . . . . . . . . . . .121
SECTION 12.2. Exercise of Conversion Privilege. . .121
SECTION 12.3. Fractions of Shares . . . . . . . . .123
SECTION 12.4. Adjustment of Conversion Price. . . .124
SECTION 12.5. Notice of Adjustments of Conversion
Price . . . . . . . . . . . . . . . .128
SECTION 12.6. Notice of Certain Corporate Action. .128
SECTION 12.7. Company to Reserve Common Stock . . .129
SECTION 12.8. Taxes on Conversions. . . . . . . . .130
SECTION 12.9. Covenant as to Common Stock . . . . .130
SECTION 12.10. Cancellation of Converted
Securities. . . . . . . . . . . . . .130
SECTION 12.11. Provision in Case of Consolidation,
Merger
or Sale of Assets. . . . . . . . . . . .130
ARTICLE THIRTEEN
SUBORDINATION OF SECURITIES. . . . . . .132
SECTION 13.1. Securities Subordinate to Senior
Indebtedness. . . . . . . . . . . . .132
SECTION 13.2. Payment Over of Proceeds Upon
Dissolution, Etc. . . . . . . . . . .132
SECTION 13.3. Prior Payment to Senior
Indebtedness Upon
Acceleration of
Securities. . . . . . . . . . . . . .133
SECTION 13.4. No Payment When Senior Indebtedness
in Default. . . . . . . . . . . . . .134
SECTION 13.5. Payment Permitted If No Default . . .134
SECTION 13.6. Subrogation to Rights of
Holders of Senior
Indebtedness. . . . . . . . . . . . .134
SECTION 13.7. Provisions Solely to Define
Relative Rights . . . . . . . . . . .135
SECTION 13.8. Trustee to Effectuate
Subordination . . . . . . . . . . . .135
SECTION 13.9. No Waiver of Subordination
Provisions. . . . . . . . . . . . . .135
SECTION 13.10. Notice to Trustee . . . . . . . . . .136
SECTION 13.11. Reliance on Judicial Order or
Certificate of Liquidating Agent. . .137
SECTION 13.12. Trustee Not Fiduciary for Holders
of Senior Indebtedness. . . . . . . .137
Note: This table of contents shall not, for any purpose, be
deemed to be a part of the Indenture.
SECTION 13.13. Rights of Trustee as Holder of
Senior Indebtedness; Preservation
of Trustee's Rights . . . . . . . . .137
SECTION 13.14. Article Applicable to Paying
Agents. . . . . . . . . . . . . . . .138
SECTION 13.15. Certain Conversions Deemed Payment. .138
ARTICLE FOURTEEN
REPURCHASE OF SECURITIES AT THE OPTION OF THE
HOLDER UPON A CHANGE IN CONTROL. . . . . .139
SECTION 14.1. Right to Require Repurchase . . . . .139
SECTION 14.2. Notices; Method of
Exercising Repurchase
Right, Etc. . . . . . . . . . . . . .140
SECTION 14.3. Certain Definitions . . . . . . . . .144
ARTICLE FIFTEEN
HOLDERS LISTS AND REPORTS BY TRUSTEE AND COMPANY. .146
SECTION 15.1. Company to Furnish
Trustee Names and
Addresses of Holders. . . . . . . . .146
SECTION 15.2. Preservation of Information . . . . .146
Note: This table of contents shall not, for any purpose, be
deemed to be a part of the Indenture.
INDENTURE, dated as of June 5, 1996, between
United Waste Systems, Inc., a corporation duly organized and
existing under the laws of the State of Delaware, having its
principal office at Four Greenwich Office Park, Greenwich,
Connecticut 06830 (herein called the "Company"), and Bankers
Trust Company, a New York banking corporation, as Trustee
hereunder (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an
issue of its 4-1/2% Convertible Subordinated Notes due June 1,
2001 (herein called the "Securities") and the coupons, if
any, thereto appertaining, of substantially the tenor and
amount hereinafter set forth, and to provide therefor the
Company has duly authorized the execution and delivery of
this Indenture.
All things necessary to make the Securities and
the coupons thereto appertaining, when the Securities are
executed by the Company and authenticated and delivered
hereunder, the valid obligations of the Company, and to make
this Indenture a valid agreement of the Company, in
accordance with their and its terms, have been done.
Further, all things necessary to duly authorize the issuance
of the Common Stock of the Company issuable upon the
conversion of the Securities, and to duly reserve for
issuance the number of shares of Common Stock issuable upon
such conversion, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the
purchase of the Securities by the Holders thereof, it is
mutually covenanted and agreed, for the equal and pro-
portionate benefit of all Holders of the Securities and the
coupons thereto appertaining, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 1.1. 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 accounting terms not otherwise defined
herein have the meanings assigned to them in accordance
with generally accepted accounting principles in the
United States, and, except as otherwise herein
expressly provided, the term "generally accepted
accounting principles" with respect to any computation
required or permitted hereunder shall mean such
accounting principles as are generally accepted at the
date of such computation; and
(3) 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 of a
Security, has the meaning specified in Section 1.4.
"Additional Amounts" has the meaning specified in
Section 2.2(a).
"Affiliate" of any specified Person means any
other Person directly or indirectly controlling or con-
trolled 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.
"Applicable Procedures" means, with respect to any
transfer or transaction involving a Registered Security or
beneficial interest therein, the rules and procedures of the
Depositary for such Security, in each case to the extent
applicable to such transfer or transaction and as in effect
from time to time.
"Authenticating Agent" means any Person authorized
pursuant to Section 6.12 to act on behalf of the Trustee to
authenticate Securities.
"Authorized Newspaper" means a newspaper, in an
official language of the country of publication or in the
English language, customarily published on each Monday,
Tuesday, Wednesday, Thursday and Friday, whether or not
published on Saturdays, Sundays or holidays, and of general
circulation in the place in connection with which the term
is used or in the financial community of such place. Where
successive publications are required to be made in
Authorized Newspapers, the successive publications may be
made in the same or in different newspapers in the same city
meeting the foregoing requirements and in each case on any
Monday, Tuesday, Wednesday, Thursday and Friday. For
purposes of publication in London, such term shall mean the
"Financial Times", unless such newspaper is not available.
"Bearer Additional Amounts" has the meaning
specified in Section 2.2(a).
"Bearer Security" means any Security issued in
substantially the form set forth in Section 2.2(a).
"Board of Directors" means either the board of
directors of the Company or any committee of that board
empowered to act for it with respect to this Indenture.
"Board Resolution" means a resolution duly adopted
by the Board of Directors, a copy of which, 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,
shall have been delivered to the Trustee.
"Business Day", when used with respect to any
Place of Payment, Place of Conversion or any other place, as
the case may be, means each Monday, Tuesday, Wednesday,
Thursday and Friday which is not a day on which banking
institutions in such Place of Payment, Place of Conversion
or other place, as the case may be, are authorized or
obligated by law or executive order to close; provided,
however, that a day on which banking institutions in New
York, New York are authorized or obligated by law or
executive order to close shall not be a Business Day for
purposes of Section 13.10; provided, further, that a day on
which banking institutions in New York, New York or London,
England are authorized or obligated by law or executive
order to close shall not be a Business Day for purposes of
Sections 10.1, 10.3 or 11.6.
"CEDEL" has the meaning specified in Section 3.4.
"Closing Price Per Share" means, with respect to
common stock, for any day, the reported last sales price
regular way per share or, in case no such reported sale
takes place on such day, the average of the reported closing
bid and asked prices regular way, in either case (i) on the
Nasdaq National Market or, if the common stock is not quoted
on the Nasdaq National Market, on the principal national
securities exchange on which the common stock is listed or
admitted to trading or (ii) if not quoted on the Nasdaq
National Market or listed or admitted to trading on any
national securities exchange, the average of the closing bid
and asked prices in the over-the-counter market as furnished
by any New York Stock Exchange member firm selected from
time to time by the Company for that purpose.
"Code" has the meaning specified in Section 2.1.
"Commission" means the United States Securities
and Exchange Commission.
"Common Depositary" has the meaning specified in
Section 3.4.
"Common Stock" means the Common Stock, par value
$.001 per share, of the Company authorized at the date of
this instrument as originally executed. Subject to the
provisions of Section 12.11, shares issuable on conversion
of Securities shall include only shares of Common Stock or
shares of any class or classes of common stock resulting
from any reclassification or reclassifications thereof;
provided, however, that if at any time there shall be more
than one such resulting class, the shares so issuable on
conversion of Securities shall include shares of all such
classes, and the shares of each such class then so issuable
shall be substantially in the proportion which the total
number of shares of such class resulting from all such
reclassifications bears to the total number of shares of all
such classes resulting from all such reclassifications.
"common stock" includes any stock of any class of
capital stock which has no preference in respect of
dividends or of amounts payable in the event of any
voluntary or involuntary liquidation, dissolution or winding
up of the issuer thereof and which is not subject to
redemption by the issuer thereof.
"Company" means the Person named as the "Company"
in the first paragraph of this instrument until a successor
Person shall have become such pursuant to the applicable
provisions of this Indenture, and thereafter "Company" shall
mean such successor Person.
"Company Request" or "Company Order" means a
written request or order signed in the name of the Company
by its Chairman of the Board, its Vice Chairman of the
Board, its Chief Executive Officer, its President or a Vice
President, and by its principal financial officer,
Treasurer, an Assistant Treasurer, its Secretary or an
Assistant Secretary, and delivered to the Trustee.
"Constituent Person" has the meaning specified in
Section 12.11.
"Conversion Agent" means any Person authorized by
the Company to convert Securities in accordance with Article
Twelve. The Company has initially appointed the Trustee as
its Conversion Agent in the Borough of Manhattan, The City
of New York, and as its Conversion Agent in London, England.
"Conversion Price" has the meaning specified in
Section 12.1.
"Corporate Trust Office" means the office of the
Trustee at which at any particular time its corporate trust
business shall be principally administered (which at the
date of this Indenture is located at Four Albany Street, New
York, New York.
"corporation" means a corporation, company,
including, without limitation, a limited liability company,
association, joint-stock company or business trust.
"coupon" means any interest coupon appertaining to
a Bearer Security.
"Defaulted Interest" has the meaning specified in
Section 3.7.
"Definitive Security" means any Security that is a
Bearer Security (other than the Temporary Global Bearer
Security) or a Registered Security.
"Depositary" means, with respect to any Registered
Securities, a clearing agency that is registered as such
under the Exchange Act and is designated by the Company to
act as Depositary for such Registered Securities (or any
successor securities clearing agency so registered).
"Determination Notice" has the meaning specified
in Section 2.2(a).
"Dollar" or "U.S.$" means a dollar or other
equivalent unit in such coin or currency of the United
States as at the time shall be legal tender for the payment
of public and private debts.
"Effectiveness Failure" has the meaning specified
in Section 10.12.
"EUROCLEAR" has the meaning specified in Section
3.4.
"Event of Default" has the meaning specified in
Section 5.1.
"Exchange Act" means the United States Securities
Exchange Act of 1934, as amended from time to time.
"Exchange Date" means the date 40 days after June
5, 1996.
"Holder", when used with respect to any Registered
Security, means the Person in whose name the Security is
registered in the Security Register, when used with respect
to any Bearer Security or Temporary Global Bearer Security,
means the bearer thereof and, when used with respect to any
coupon, means the bearer thereof.
"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.
"Interest Payment Date" means the Stated Maturity
of an installment of interest on the Securities.
"Liquidated Damages" has the meaning specified in
Section 10.12.
"Maturity", when used with respect to any
Security, means the date on which the principal of such
Security becomes due and payable as therein or herein
provided, whether at the Stated Maturity or by declaration
of acceleration, call for redemption, exercise of the
repurchase right set forth in Article Fourteen or otherwise.
"Non-electing Share" has the meaning specified in
Section 12.11.
"Officers' Certificate" means a certificate signed
by the Chairman of the Board, a Vice Chairman of the Board,
the Chief Executive Officer, the President or a Vice
President and by the principal financial officer, the
Treasurer, an Assistant Treasurer, the Secretary or an
Assistant Secretary of the Company, and delivered to the
Trustee.
"Opinion of Counsel" means a written opinion of
counsel, who may be counsel for, or an employee of, the
Company and who shall be reasonably acceptable to the
Trustee.
"Outstanding", when used with respect to Secur-
ities, means, as of the date of determination, all
Securities theretofore authenticated and delivered under
this Indenture, except:
(i) Securities theretofore canceled by the
Trustee or delivered to the Trustee for
cancellation;
(ii) Securities for the payment or redemption
of which money in the necessary amount has been
theretofore deposited with the Trustee or any
Paying Agent (other than the Company) or set aside
and segregated in trust by the Company (if the
Company shall act as its own Paying Agent) for the
Holders of such Securities and any coupons thereto
appertaining, provided that if such Securities are
to be redeemed, notice of such redemption has been
duly given pursuant to this Indenture or provision
therefor satisfactory to the Trustee has been
made; and
(iii) Securities which have been paid pursuant
to Section 3.6 or in exchange for or in lieu of
which other Securities have been authenticated and
delivered pursuant to this Indenture, other than
any such Securities in respect of which there
shall have been presented to the Trustee proof
satisfactory to it that such Securities are held
by a bona fide purchaser in whose hands such
Securities are valid obligations of the Company;
provided, however, that in determining whether the Holders
of the requisite principal amount of Outstanding Securities
are present at a meeting of Holders of Securities for quorum
purposes or have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, Securities
owned by the Company or any other obligor upon the Secur-
ities or any Affiliate of the Company or 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 determination as to the
presence of a quorum or upon any such request, demand,
authorization, direction, notice, consent or waiver, only
Securities which a Responsible Officer of the Trustee
actually knows to be so owned shall be so disregarded.
Securities so owned which have been pledged in good faith
may be regarded as Outstanding if the pledgee establishes to
the satisfaction of the Trustee the pledgee's right so to
act with respect to such Securities and that the pledgee is
not the Company or any other obligor upon the Securities or
any Affiliate of the Company or such other obligor.
"Paying Agent" means any Person authorized by the
Company to pay the principal of or interest on any
Securities on behalf of the Company and, except as otherwise
specifically set forth herein, such term shall include the
Company if it shall act as its own Paying Agent. The
Company has initially appointed the Trustee as its Paying
Agent in the Borough of Manhattan, The City of New York, and
as its Paying Agent in London, England.
"Person" means any individual, corporation,
partnership, joint venture, trust, estate, unincorporated
organization or government or any agency or political
subdivision thereof.
"Place of Conversion" has the meaning specified in
Section 3.1.
"Place of Payment" has the meaning specified in
Section 3.1.
"Predecessor Security" of any particular Security
means every previous Security evidencing all or a portion of
the same debt as that evidenced by such particular Security;
and, for the purposes of this definition, any Security
authenticated and delivered under Section 3.6 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.
"Record Date" means any Regular Record Date or
Special Record Date.
"Redemption Date", when used with respect to any
Security to be redeemed, means the date fixed for such
redemption by or pursuant to this Indenture.
"Redemption Price", when used with respect to any
Security to be redeemed, means the price at which it is to
be redeemed pursuant to this Indenture.
"Registered Security" means any Security issued in
substantially the form set forth in Section 2.2(b) and
registered in the Security Register.
"Registration Default" has the meaning specified
in Section 10.12.
"Registration Rights Agreement" has the meaning
specified in Section 10.12.
"Regular Record Date" for interest payable in
respect of any Registered Security on any Interest Payment
Date means the May 15 or November 15 (whether or not a
Business Day), as the case may be, next preceding such
Interest Payment Date.
"Repurchase Date" has the meaning specified in
Section 14.1.
"Repurchase Price" has the meaning specified in
Section 14.1.
"Responsible Officer", when used with respect to
the Trustee, means any officer within the Corporate Trust
Office of the Trustee including without limitation any vice
president, assistant vice president, assistant treasurer,
assistant secretary, corporate trust officer, assistant
corporate trust officer or other employee of the Trustee
customarily performing functions similar to those performed
by any of the above designated officers and also means, with
respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of his
knowledge and familiarity with the particular subject.
"Restricted Security" has the meaning specified in
Section 2.6.
"Rule 144A Information" has the meaning specified
in Section 10.10.
"Securities" has the meaning ascribed to it in the
first paragraph under the caption "Recitals of the Company".
"Securities Act" means the United States
Securities Act of 1933, as amended from time to time.
"Security Register" and "Security Registrar" have
the respective meanings specified in Section 3.5.
"Senior Indebtedness" means (a) the principal of (and
premium, if any) and interest (including interest accruing after
the filing of a petition initiating any proceeding under any
state, federal or foreign bankruptcy laws whether or not
allowable as a claim in such proceeding) on the indebtedness
outstanding under the Third Amended and Restated Credit
Agreement, dated as of August 16, 1995, among the Company, the
financial institutions listed therein, The First National Bank of
Boston and Natwest Bank N.A., as Co-Agents, and Bank of America
Illinois, as Agent, and the Company's $75,000,000 principal
amount of 7.67% Senior Secured Notes Due September 1, 2005,
issued pursuant to the Secured Note Agreement, dated as of
September 1, 1995, including any modifications, refundings,
deferrals, renewals, restatements or extensions of any such
indebtedness and all fees, charges, expenses, reimbursements and
indemnification obligations and other amounts payable thereunder,
(b) all other indebtedness of the Company (including indebtedness
of others guaranteed by the Company) other than the Securities,
whether outstanding on the date of this Indenture or thereafter
created, incurred or assumed, which is (i) for money borrowed or
(ii) evidenced by a note or similar instrument given in
connection with the acquisition of any businesses, properties or
assets of any kind, (c) obligations of the Company as lessee
under leases required to be capitalized on the balance sheet of
the lessee under generally accepted accounting principles,
(d) obligations of the Company under interest rate and currency
swaps, caps, floors, collars or similar agreements or
arrangements intended to protect the Company against fluctuations
in interest or currency exchange rates and (e) renewals,
extensions, modifications, restatements and refundings of any
such indebtedness or obligation; provided, however, that Senior
Indebtedness shall not include any such indebtedness or
obligation (a) if the terms of such indebtedness or obligation
(or the terms of the instrument under which, or pursuant to
which, it is issued) provide that such indebtedness or obligation
is not superior in right of payment to the Securities, (b) if
such indebtedness or obligation is non-recourse to the Company,
(c) if such indebtedness or obligation is a conditional sale
contract or any account payable or any other indebtedness created
or assumed by the Company in the ordinary course of business in
connection with the obtaining of inventories or services or (d)
if such indebtedness or obligation is unsecured.
"Shelf Registration Statement" has the meaning
specified in Section 10.12.
"Special Record Date" for the payment of any
Defaulted Interest means a date fixed by the Company
pursuant to Section 3.7.
"Stated Maturity", when used with respect to any
Security or any installment of interest thereon, means the
date specified in such Security or a coupon representing
such installment of interest as the fixed date on which the
principal of such Security or such installment of 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 Subsidi-
aries, or by the Company and one or more other Subsidiaries.
For the purposes of this definition, "voting stock" means
stock or other similar interests in the corporation which
ordinarily has or have voting power for the election of
directors, or persons performing similar functions, whether
at all times or only so long as no senior class of stock or
other interests has or have such voting power by reason of
any contingency.
"Tax Affected Security" means any Security with
respect to which Additional Amounts or Bearer Additional
Amounts have or will become payable.
"Tax Law Change" means any change in, or amendment
to, the laws (including any regulations or rulings
promulgated thereunder) of the United States or any
political subdivision or taxing authority thereof or therein
affecting taxation, or any change in, or amendment to, the
application or official interpretation of such laws,
regulations or rulings.
"Temporary Global Bearer Security" means any
Security issued in substantially the form set forth in
Section 2.2(c).
"Trading Days" means (i) if the common stock is
listed or admitted for trading on any national securities
exchange, days on which such national securities exchange is
open for business; (ii) if the common stock is quoted on the
Nasdaq National Market or any other system of automated
dissemination of quotations of securities prices, days on
which trades may be effected through such system; or
(iii) if the common stock is not listed or admitted for
trading on any national securities exchange or quoted on the
Nasdaq National Market or any other system of automated
dissemination of quotation of securities prices, days on
which the common stock is traded regular way in the over-
the-counter market and for which a closing bid and a closing
asked price for the common stock are available.
"Transfer Agent" has the meaning specified in
Section 2.2(a). The Company has initially appointed the
Trustee as its Transfer Agent in the Borough of Manhattan,
The City of New York and as its Transfer Agent in London,
England.
"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 such successor Trustee.
"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.
"United States" means the United States of America
(including the States and the District of Columbia), its
territories, its possessions and other areas subject to its
jurisdiction (its "possessions" including Puerto Rico, the
U.S. Virgin Islands, Guam, American Samoa, Wake Island and
the Northern Mariana Islands).
"United States person" has the meaning specified
in Section 2.2(a).
"Vice President", when used with respect to the
Company, means any vice president, whether or not designated
by a number or a word or words added before or after the
title "vice president".
"Western Europe" means Austria, Belgium, Denmark,
France, Germany, Ireland, Italy, Luxembourg, the
Netherlands, Norway, Portugal, Spain, Sweden, Switzerland
and the United Kingdom.
SECTION 1.2. Compliance Certificates and Opinions.
Upon any application or request by the Company to
the Trustee or the Paying Agent in London, England, to take
any action under any provision of this Indenture, the
Company shall furnish to the Trustee or the Paying Agent in
London, England, as the case may be, an Officers'
Certificate stating that all conditions precedent, if any,
provided for in this Indenture relating to the proposed
action have been complied with and an Opinion of Counsel
stating that in the opinion of such counsel all such condi-
tions precedent, if any, have been complied with, except
that in the case of any such application or request as to
which the furnishing of such documents is specifically
required by any provision of this Indenture relating to such
particular application or request, no additional certificate
or opinion need be furnished.
Every certificate or opinion with respect to com-
pliance with a condition or covenant provided for in this
Indenture (including certificates provided for in Section
10.9) 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 such
individual, he has made such examination or
investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant
or condition has been complied with; and
(4) a statement as to whether, in the opinion of
each such individual, such condition or covenant has
been complied with.
SECTION 1.3. Form of Documents Delivered to the 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 cer-
tified 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 representa-
tions by, counsel, unless such officer knows, or in the
exercise of reasonable care should know, that the cer-
tificate or opinion or representations with respect to the
matters upon which such 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 1.4. Acts of Holders of Securities.
(a) Any request, demand, authorization, direc-
tion, notice, consent, waiver or other action provided or
permitted by this Indenture to be given or taken by Holders
of Securities may be embodied in and evidenced by (1) one or
more instruments of substantially similar tenor signed by
such Holders in person or by an agent or proxy duly
appointed in writing by such Holders or (2) the record of
Holders of Securities voting in favor thereof, either in
person or by proxies duly appointed in writing, at any
meeting of Holders of Securities duly called and held in
accordance with the provisions of Article Nine. Such action
shall become effective when such instrument or instruments
or record is delivered to the Trustee and, where it is
hereby expressly required, to the Company. The Trustee
shall promptly deliver to the Company copies of all such
instruments and records delivered to the Trustee. Such
instrument or instruments and record (and the action
embodied therein and evidenced thereby) are herein sometimes
referred to as the "Act" of the Holders of Securities
signing such instrument or instruments and so voting at such
meeting. Proof of execution of any such instrument or of a
writing appointing any such agent or proxy, or of the
holding by any Person of a Security, shall be sufficient for
any purpose of this Indenture and (subject to Section 6.1)
conclusive in favor of the Trustee and the Company if made
in the manner provided in this Section. The record of any
meeting of Holders of Securities shall be proved in the
manner provided in Section 9.6.
(b) The fact and date of the execution by any
Person of any such instrument or writing may be proved by
the affidavit of a witness of such execution or by a cer-
tificate of a notary public or other officer authorized by
law to take acknowledgements 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.
(c) The principal amount and serial number of any
Bearer Security held by any Person, and the date of his
holding the same, may be proved by the production of such
Bearer Security or by a certificate executed by any trust
company, bank, broker or other depositary, wherever situ-
ated, if such certificate shall be deemed by the Trustee or
the Paying Agent in London, England, to be satisfactory,
showing that at the date therein mentioned such Person had
on deposit with such depositary, or exhibited to it, the
Bearer Security therein described; or such facts may be
proved by the certificate or affidavit of the Person holding
such Bearer Security, if such certificate or affidavit is
deemed by the Trustee or the Paying Agent in London,
England, to be satisfactory. The Trustee, the Paying Agent
in London, England, and the Company may assume that any
Bearer Security continues to be held by such Person until
(1) another certificate or affidavit bearing a later date
issued in respect of such Bearer Security is produced, or
(2) such Bearer Security is produced to the Trustee or the
Paying Agent in London, England, by some other Person, or
(3) such Bearer Security is surrendered in exchange for a
Registered Security, or (4) such Bearer Security is no
longer Outstanding.
(d) The principal amount and serial number of any
Registered Security held by any Person, and the date of his
holding the same, shall be proved by the Security Register.
(e) The principal amount and serial numbers of
Bearer Securities held by the Person so executing such
instrument or writing and the date of holding the same may
also be proved in any other manner which the Paying Agent in
London, England, deems sufficient; and the Paying Agent in
London, England, may in any instance require further proof
with respect to any of the matters referred to in this
Section 1.4.
(f) The fact and date of execution of any such
instrument or writing and the authority of the Person
executing the same may also be proved in any other manner
which the Trustee or the Paying Agent in London, England,
deems sufficient; and the Trustee or the Paying Agent in
London, England, may in any instance require further proof
with respect to any of the matters referred to in this
Section 1.4.
(g) Any request, demand, authorization, direc-
tion, notice, consent, election, waiver or other Act of the
Holder of any Security shall bind every future Holder of the
same Security and any coupon appertaining thereto and the
Holder of every Security or coupon 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 or coupon.
(h) The provisions of this Section 1.4 are
subject to the provisions of Section 9.5.
SECTION 1.5. Notices, Etc., to Trustee and Company.
Any request, demand, authorization, direction,
notice, consent, election, waiver or other Act of Holders of
Securities or other document provided or permitted by this
Indenture to be made upon, given or furnished to, or filed
with,
(1) the Trustee or the Paying Agent in London,
England, by any Holder of Securities or by the Company
shall be sufficient for every purpose hereunder if
made, given, furnished or filed in writing to or with
the Trustee and received at its Corporate Trust Office,
Attention: Corporate Trust and Agency Group, or to or
with the Paying Agent in London and received at
1 Appold Street, Broadgate, London EC2A 2HE, England,
Attention: Corporate Trust and Agency Group, or
(2) the Company by the Trustee or by any Holder
of Securities shall be sufficient for every purpose
hereunder (unless otherwise herein expressly provided)
if in writing, mailed, first-class postage prepaid, or
telecopied and confirmed by mail, first-class postage
prepaid, or delivered by hand or overnight courier,
addressed to the Company at Four Greenwich Office Park,
Greenwich, Connecticut 06830, telecopy no.: (203) 622-
6080, Attention: Secretary, or at any other address
previously furnished in writing to the Trustee by the
Company.
Any request, demand, authorization, direction,
notice, consent, election or waiver required or permitted
under this Indenture shall be in the English language,
except that any published notice may be in an official
language of the country of publication.
SECTION 1.6. Notice to Holders of Securities; Waiver.
Except as otherwise expressly provided herein,
where this Indenture provides for notice to Holders of
Securities of any event,
(1) such notice shall be sufficiently given to
Holders of Bearer Securities or any Temporary Global
Bearer Security if published in an Authorized Newspaper
in the City of London, England or, if not practicable
in London, England, elsewhere in any country in Western
Europe, on a Business Day at least twice, the first
such publication to be not earlier than the earliest
date and the second such publication to be not later
than the latest date herein prescribed for the giving
of such notice; and
(2) such notice shall be sufficiently given to
Holders of Registered Securities if in writing and
mailed, first-class postage prepaid, to each Holder of
a Registered Security affected by such event, at the
address of such Holder as it appears in the Security
Register, not earlier than the earliest date and not
later than the latest date prescribed for the giving of
such notice.
Neither the failure to give notice by publication
to Holders of Bearer Securities or any Temporary Global
Bearer Security as provided above, nor any defect in any
notice so published, shall affect the sufficiency of any
notice mailed to Holders of Registered Securities as
provided above. In case by reason of the suspension of
publication of any Authorized Newspaper or Authorized
Newspapers or by reason of any other cause it shall be
impracticable to publish any notice as provided above, then
such notification as shall be given with the approval of the
Trustee, which approval shall not be unreasonably withheld,
shall constitute sufficient notice to such Holders for every
purpose hereunder.
In any case where notice to Holders of Registered
Securities is given by mail, neither the failure to mail
such notice, nor any defect in any notice so mailed, to any
particular Holder of a Registered Security shall affect the
sufficiency of such notice with respect to other Holders of
Registered Securities or the sufficiency of any notice by
publication to Holders of Bearer Securities or any Temporary
Global Bearer Security given as provided above. 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 to Holders of
Registered Securities as shall be made with the approval of
the Trustee, which approval shall not be unreasonably with-
held, shall constitute a sufficient notification to such
Holders for every purpose hereunder.
In the case of paragraph (1) of this section, such
notice shall be deemed to have been given on the date of
such publication or, if published in Authorized Newspapers
on different dates, on the date of the first such
publication.
In the case of paragraph (2) of this section, such
notice shall be deemed to have been given when such notice
is mailed.
Where this Indenture provides for notice in any
manner, such notice may be waived in writing by the Person
entitled to receive such notice, either before or after the
event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders of Securities shall be
filed with the Trustee, but such filing shall not be a
condition precedent to the validity of any action taken in
reliance upon such waiver.
SECTION 1.7. The Application of Trust Indenture Act.
The Trust Indenture Act shall apply as a matter of
contract to this Indenture for purposes of interpretation,
construction and defining the rights and obligations
hereunder. 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 1.8. Effect of Headings and Table of Contents.
The Article and Section headings herein and the
Table of Contents are for convenience only and shall not
affect the construction hereof.
SECTION 1.9. 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 1.10. Separability Clause.
In case any provision in this Indenture or the
Securities or coupons shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or
impaired thereby.
SECTION 1.11. Benefits of Indenture.
Except as provided in the next sentence, nothing
in this Indenture or in the Securities or coupons, express
or implied, shall give to any Person, other than the parties
hereto and their successors and assigns hereunder and the
Holders of Securities and coupons, any benefit or legal or
equitable right, remedy or claim under this Indenture. The
provisions of Article Thirteen are intended to be for the
benefit of, and shall be enforceable directly by, the
holders of Senior Indebtedness.
SECTION 1.12. Governing Law.
THIS INDENTURE AND THE SECURITIES AND COUPONS
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, THE UNITED STATES OF AMERICA,
WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS.
SECTION 1.13. Legal Holidays.
In any case where any Interest Payment Date,
Redemption Date, Repurchase Date or Stated Maturity of any
Security or coupon or the last day on which a Holder of a
Security has a right to convert his Security shall not be a
Business Day at a Place of Payment or Place of Conversion,
as the case may be, then (notwithstanding any other
provision of this Indenture or of the Securities or coupons)
payment of interest or principal and premium, if any, or
delivery for conversion of such Security need not be made at
such Place of Payment or Place of Conversion, as the case
may be, on or by such day, but may be made on or by the next
succeeding Business Day at such Place of Payment or Place of
Conversion, as the case may be, with the same force and
effect as if made on the Interest Payment Date, Redemption
Date or Repurchase Date, or at the Stated Maturity or by
such last day for conversion; provided, however, that in the
case that payment is made on such succeeding Business Day,
no interest shall accrue on the amount so payable for the
period from and after such Interest Payment Date, Redemption
Date, Repurchase Date, Stated Maturity or last day for
conversion, as the case may be.
ARTICLE TWO
SECURITY FORMS
SECTION 2.1. Forms Generally.
The Securities and the coupons shall be in sub-
stantially the forms set forth in this Article, 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, the Internal Revenue Code of 1986, as
amended, and regulations thereunder (the "Code"), or as may,
consistently herewith, be determined by the officers
executing such Securities and coupons, as evidenced by their
execution thereof.
The Trustee's certificates of authentication shall
be in substantially the form set forth in Section 2.4.
Conversion notices shall be in substantially the
form set forth in Section 2.5.
Registered Securities that are Restricted
Securities shall bear the legend required by Section 2.6.
The Temporary Global Bearer Security may be
printed, lithographed, typewritten, mimeographed or
otherwise produced, as determined by the officers of the
Company executing such Security, as evidenced by their
execution thereof. The format and spacing of the text of a
Definitive Security may be varied to facilitate such
production.
The Definitive Securities and coupons shall be
printed, lithographed or engraved or produced by any
combination of these methods on steel engraved borders or
may be produced in any other manner permitted by the rules
of any securities exchange on which the Securities may be
listed, all as determined by the officers executing such
Securities and coupons, as evidenced by their execution
thereof.
SECTION 2.2. Forms of Securities.
(a) Form of Bearer Security
[FORM OF FACE]
ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE
SUBJECT TO LIMITATIONS UNDER THE UNITED STATES INCOME TAX
LAWS, INCLUDING THE LIMITATIONS PROVIDED IN SECTIONS 165(j)
AND 1287(a) OF THE INTERNAL REVENUE CODE.
UNITED WASTE SYSTEMS, INC.
4-1/2% CONVERTIBLE SUBORDINATED NOTE
DUE JUNE 1, 2001
No. _____________ U.S. $5,000
ISIN No.
UNITED WASTE SYSTEMS, INC., a corporation duly
organized and existing under the laws of the State of
Delaware (herein called the "Company", which term includes
any successor Person under the Indenture referred to on the
reverse hereof), for value received, hereby promises to pay
to bearer upon presentation and surrender of this Security
the principal sum of Five Thousand United States Dollars on
June 1, 2001 and to pay interest thereon, from June 5, 1996,
or from the most recent Interest Payment Date (as defined
below) to which interest has been paid or duly provided for,
semi-annually in arrears on June 1 and December 1 in each
year (each, an "Interest Payment Date"), commencing December
1, 1996, at the rate of 4-1/2% per annum, until the principal
hereof is due, and at the rate of 4-1/2% per annum on any
overdue principal and premium, if any, and, to the extent
permitted by law, on any overdue interest. Such payments
shall be made, subject to any laws or regulations applicable
thereto and to the right of the Company (limited as provided
in the Indenture) to terminate the appointment of any such
Paying Agent, at the option of the Holder at the office of
Bankers Trust Company, 1 Appold Street, Broadgate, London
EC2A 2HE, England, or at such other offices or agencies
outside the United States (as defined below) as the Company
may designate, at the option of the Holder by United States
Dollar check drawn on a bank in the Borough of Manhattan,
The City of New York or by transfer of United States Dollars
to an account maintained by the payee with a bank located
outside the United States (such a transfer to be made only
to a Holder of an aggregate principal amount of Securities
in excess of U.S. $2,000,000 and only if such Holder shall
have furnished wire instructions in writing to the Paying
Agent in London by no later than 15 days prior to the
relevant payment date). Interest on this Security due on or
before Maturity shall be payable only upon presentation and
surrender at such an office or agency of the interest
coupons hereto attached as they severally mature. No
payment of principal of, premium, if any, or interest on,
including Additional Amounts and Bearer Additional Amounts
(in each case, as defined below) with respect to, this
Security shall be made at the Corporate Trust Office of the
Trustee under the Indenture referred to on the reverse
hereof or at any other office or agency of the Company in
the United States or by check mailed to any address in the
United States or by transfer to an account maintained with a
bank located in the United States; provided, however, that
payment of principal of, premium, if any, or interest on
this Security and payment of any such Additional Amounts or
Bearer Additional Amounts may be made at the office of the
Paying Agent in the Borough of Manhattan, The City of New
York, if (but only if) payment of the full amount of such
principal, premium, if any, interest, Additional Amounts or
Bearer Additional Amounts, as the case may be, at all
offices outside the United States maintained for such
purpose by the Company in accordance with the Indenture is
illegal or effectively precluded by exchange controls or
other similar restrictions on the full payment or receipt of
such amounts in United States Dollars, as determined by the
Company.
The Company will pay to the Holder of this
Security or any coupon appertaining hereto who is not a
United States person (as defined below) such additional
amounts ("Additional Amounts") as may be necessary in order
that every net payment of the principal of, premium, if any,
and interest on this Security (including payment on
redemption or repurchase), after deduction or withholding
for or on account of any present or future tax, assessment
or governmental charge imposed upon or as a result of such
payment by the United States or any political subdivision or
taxing authority thereof or therein, will not be less than
the amount provided for in this Security or in such coupon
to be then due and payable; provided, however, that the
foregoing obligation to pay Additional Amounts will not
apply to:
(a) any tax, assessment or other governmental
charge which would not have been so imposed but for
(i) the existence of any present or former connection
between such Holder (or between a fiduciary, settlor,
beneficiary, member, shareholder of or possessor of a
power over such Holder, if such Holder is an estate, a
trust, a partnership or a corporation) and the United
States or any political subdivision or taxing authority
thereof or therein, including, without limitation, such
Holder (or such fiduciary, settlor, beneficiary,
member, shareholder or possessor) being or having been
a citizen or resident of the United States or treated
as a resident thereof, or being or having been engaged
in trade or business or present therein, or having or
having had a permanent establishment therein, or (ii)
such Holder's present or former status as a personal
holding company, a foreign personal holding company
with respect to the United States, a controlled foreign
corporation, a passive foreign investment company, or a
foreign private foundation or foreign tax exempt entity
for United States tax purposes, or a corporation which
accumulates earnings to avoid United States Federal
income tax;
(b) any tax, assessment or other governmental
charge which would not have been so imposed but for the
presentation by the Holder of this Security or any
coupon appertaining hereto for payment on a date more
than 15 days after the date on which such payment
became due and payable or the date on which payment
thereof is duly provided for, whichever occurs later;
(c) any estate, inheritance, gift, sales,
transfer, personal property or similar tax, assessment
or governmental charge;
(d) any tax, assessment or other governmental
charge which would not have been imposed but for the
failure to comply with any certification,
identification or other reporting requirements
concerning the nationality, residence, identity or
connection with the United States of the Holder or
beneficial owner of this Security or any coupon
appertaining hereto, if compliance is required by
statute or by regulation or ruling of the United States
Treasury Department as a precondition to exemption from
such tax, assessment or other governmental charge;
(e) any tax, assessment or other governmental
charge which is payable otherwise than by deduction or
withholding from payments of principal of, premium, if
any, or interest on this Security;
(f) any tax, assessment or other governmental
charge imposed as a result of a Person's past or
present actual or constructive ownership, including by
virtue of the right to convert Securities, of 10% or
more of the total combined voting power of all classes
of stock of the Company entitled to vote;
(g) any tax, assessment or other governmental
charge required to be withheld by any Paying Agent from
any payment of the principal of, premium, if any, or
interest on this Security, if such payment can be made
without such withholding by any other Paying Agent in
Western Europe;
(h) any tax, assessment or other governmental
charge imposed on a Holder that is a partnership or a
fiduciary, but only to the extent that any beneficial
owner or member of the partnership or beneficiary or
settlor with respect to the fiduciary would not have
been entitled to the payment of Additional Amounts had
the beneficial owner, member, beneficiary or settlor
directly received its beneficial or distributive share
of payments on this Security;
(i) any tax, assessment or other governmental
charge which would not have been imposed but for the
fact that this Security constitutes a "United States
real property interest", as defined in Section
897(c)(1) of the United States Internal Revenue Code of
1986, as amended, and the regulations thereunder, with
respect to the beneficial owner of this Security; or
(j) any combination of items (a), (b), (c), (d),
(e), (f), (g), (h) and (i).
For purposes of this Security, a "United States
person" is a Person that is, for United States Federal
income tax purposes, (a) a citizen or resident of the
United States, (b) a corporation, partnership or other
entity created or organized in or under the laws of the
United States or any political subdivision thereof or (c) an
estate or trust the income of which is subject to
United States Federal income taxation regardless of source.
Solely for purposes of the foregoing definition of "United
States person", the term "United States" shall include, when
used in the geographical sense, only the States thereof and
the District of Columbia.
Notwithstanding the foregoing, if and so long as a
certification, identification or other information reporting
requirement referred to in the fourth paragraph of the
reverse hereof would be fully satisfied by payment of a
backup withholding tax or similar charge, the Company may
elect, by so stating in the Determination Notice (as defined
on the reverse hereof), to have the provisions of this
paragraph apply in lieu of redeeming this Security pursuant
to such fourth paragraph. In such event, the Company will
pay as additional amounts ("Bearer Additional Amounts") such
amounts as may be necessary so that every net payment made,
following the effective date of such requirements, outside
the United States by the Company or any Paying Agent of
principal of, and premium, if any, due in respect of this
Security, or interest represented by any coupon, the benefi-
cial owner of which is not a United States person (but
without any requirement that the nationality, residence or
identity of such beneficial owner be disclosed to the
Company, any Paying Agent or any governmental authority),
after deduction or withholding for or on account of such
backup withholding tax or similar charge, other than a
backup withholding tax or similar charge which is (a) the
result of a certification, identification or information
reporting requirement described in the first parenthetical
clause of the first sentence of such fourth paragraph, (b)
imposed as a result of the fact that the Company or any
Paying Agent has actual knowledge that the beneficial owner
of this Security or such coupon is within the category of
Persons described in clause (a) of the second preceding
paragraph or (c) imposed as a result of presentation of this
Security or such coupon for payment more than 15 days after
the date on which such payment becomes due and payable or on
which payment thereof is duly provided for, whichever occurs
later, will not be less than the amount provided for in this
Security or such coupon to be then due and payable.
Except as specifically provided herein and in the
Indenture, the Company shall not be required to make any
payment with respect to any tax, assessment or other govern-
mental charge imposed by any government or any political
subdivision or taxing authority thereof or therein.
Whenever in this Security there is a reference, in any
context, to the payment of the principal of, premium, if
any, or interest on, or in respect of, any Security or any
coupon appertaining thereto, such mention shall be deemed to
include mention of the payment of Additional Amounts and
Bearer Additional Amounts payable as described in the first
and third preceding paragraphs, respectively, to the extent
that, in such context, Additional Amounts or Bearer
Additional Amounts, as the case may be, are, were or would
be payable in respect of this Security or any coupon
appertaining hereto pursuant to such paragraphs, and express
mention of the payment of such Additional Amounts or Bearer
Additional Amounts (if applicable), as the case may be, in
any provisions of this Security shall not be construed as
excluding Additional Amounts or Bearer Additional Amounts,
as the case may be, in those provisions of this Security
where such express mention is not made.
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 or its Authenticating Agent by the manual signature
of one of its authorized signatories, neither this Security,
nor any coupon appertaining hereto, shall be entitled to any
benefit under the Indenture or be valid or obligatory for
any purpose.
IN WITNESS WHEREOF, the Company has caused this
Security to be duly executed and coupons bearing the
facsimile signature of its Treasurer to be annexed hereto.
Dated as of June 5, 1996
UNITED WASTE SYSTEMS, INC.
By:__________________________
Name:
Title:
Attest:
________________________
Name:
Title:
[FORM OF REVERSE]
This Security is one of a duly authorized issue of
securities of the Company designated as its 4-1/2% Convertible
Subordinated Notes due June 1, 2001" (herein called the
"Securities"), limited in aggregate principal amount to
U.S.$150,000,000, issued and to be issued under an
Indenture, dated as of June 5, 1996 (herein called the
"Indenture"), between the Company and Bankers Trust Company,
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, the holders of Senior Indebtedness
and the Holders of the Securities and any coupons
appertaining thereto and of the terms upon which the
Securities are, and are to be, authenticated and delivered.
The Securities are issuable as Bearer Securities, with
interest coupons attached, in the denomination of U.S.$5,000
and as Registered Securities, without coupons, in
denominations of U.S.$1,000 and integral multiples of
U.S.$1,000 in excess thereof. As provided in the Indenture
and subject to certain limitations therein set forth, Bearer
Securities are exchangeable for a like aggregate principal
amount of Registered Securities of any authorized
denominations as requested by the Holder surrendering the
same upon surrender of the Security or Securities to be
exchanged, with all unmatured coupons and all matured
coupons in default thereto appertaining, except as provided
below, (a) at the Corporate Trust Office of the Trustee or
at such other office or agency of the Company as may be
designated by it for such purpose in The City of New York or
(b) subject to any laws or regulations applicable thereto
and to the right of the Company to terminate the appointment
of any Transfer Agent (as defined below), at the office of
Bankers Trust Company, 1 Appold Street, Broadgate, London
EC2A 2HE, England, or at such other offices or agencies
outside the United States as the Company may designate (each
a "Transfer Agent'); provided, however, that such surrender
may be made at the Corporate Trust Office of the Trustee in
the Borough of Manhattan, The City of New York, if (but only
if) such surrender at all offices outside the United States
maintained for such purpose by the Company in accordance
with the Indenture is illegal or effectively precluded by
exchange controls or other similar restrictions on the full
payment or receipt of such amounts in United States Dollars,
as determined by the Company. Bearer Securities surrendered
in exchange for Registered Securities between a Record Date
and the relevant Interest Payment Date or date for payment
of Defaulted Interest will not be required to be surrendered
with the coupon relating to such Interest Payment Date or
date for payment of Defaulted Interest. Bearer Securities
may not be issued in exchange for Registered Securities.
No sinking fund is provided for the Securities.
The Securities are subject to redemption at the option of
the Company at any time on or after June 1, 1999, in whole
or in part, upon not less than 30 nor more than 60 days'
notice to the Holders prior to the Redemption Date, at a
Redemption Price equal to 101.8% of the principal amount if
redeemed prior to June 1, 2000, at a Redemption Price equal
to 100.9% of the principal amount, if redeemed on or after
June 1, 2000 and prior to the Stated Maturity and, together,
in each case, with accrued interest to the Redemption Date,
and Securities held by non-United States persons and Bearer
Securities are also redeemable in whole but not in part,
under the circumstances described in the next two succeeding
paragraphs, respectively, at a Redemption Price equal to
100% of the principal amount thereof plus interest accrued
to the Redemption Date; provided, however, that interest
installments on Bearer Securities whose Stated Maturity is
on or prior to such Redemption Date will be payable only
upon presentation and surrender of coupons for such interest
(at an office or agency outside the United States except as
herein provided otherwise).
If as a result of a Tax Law Change, the Company
has or will become obligated to pay to the Holder of any
Security or coupon Additional Amounts, as described in the
second paragraph of the face of this Security, and such
obligation cannot be avoided by the Company taking
reasonable measures available to it, then the Company may,
at its option, redeem the Tax Affected Securities as a
whole, but not in part, upon not less than 30 nor more than
60 days' notice to the Holders prior to the Redemption Date,
at a Redemption Price equal to 100% of the principal amount
plus interest accrued to the Redemption Date, and any
Additional Amounts then payable; provided, that (i) no such
notice of redemption shall be given earlier than 90 days
prior to the earliest date on which the Company would be
obligated to pay any such Additional Amounts were a payment
in respect of the Tax Affected Securities then due and
(ii) at the time such notice of redemption is given, such
obligation to pay such Additional Amounts remains in effect.
Prior to the publication of any notice of redemption
pursuant to this paragraph, the Company shall deliver to the
Trustee (a) an Officers's Certificate stating that the
Company is entitled to effect such redemption and setting
forth a statement of facts showing that the conditions
precedent to the right of the Company so to redeem have
occurred and (b) an Opinion of Counsel selected by the
Company, which counsel shall be reasonably acceptable to the
Trustee, to the effect that the Company has or will become
obligated to pay such Additional Amounts as a result of such
Tax Law Change. The Company's right to redeem the Tax
Affected Securities shall continue as long as the Company is
obligated to pay such Additional Amounts, notwithstanding
that the Company shall have made payments of Additional
Amounts specified in such second paragraph.
In addition, if the Company determines, based upon
an Opinion of Counsel, which counsel shall be reasonably
acceptable to the Trustee, that, as a result of a Tax Law
Change, any payment made outside the United States by the
Company or any of its Paying Agents of the full amount of
principal, premium, if any, or interest due with respect to
any Bearer Security or coupon appertaining thereto would be
subject to any certification, identification or other
information reporting requirement of any kind, the effect of
which requirement is the disclosure to the Company, any
Paying Agent or any governmental authority of the
nationality, residence or identity of a beneficial owner of
such Bearer Security or coupon who is not a United
States person (other than such a requirement (a) which would
not be applicable to a payment made by the Company or any
one of its Paying Agents (i) directly to the beneficial
owner or (ii) to any custodian, nominee or other agent of
the beneficial owner, (b) which can be satisfied by the
custodian, nominee or other agent certifying that such
beneficial owner is not a United States person, provided
that, in each case referred to in clauses (a)(ii) and (b),
payment by such custodian, nominee or agent to such
beneficial owner is not otherwise subject to any such
requirement, or (c) which would not be applicable but for
the fact that such Bearer Security constitutes a "United
States real property interest," as defined in
Section 897(c)(1) of the United States Internal Revenue Code
of 1986, as amended, with respect to the beneficial owner of
such Bearer Security), the Company at its election will
either (x) redeem the Bearer Securities, as a whole but not
in part, upon not less than 30 nor more than 60 days' notice
prior to the Redemption Date, at a Redemption Price equal to
100% of the principal amount thereof plus interest accrued
to the Redemption Date, or (y) if and so long as the
conditions of the fourth paragraph on the face hereof are
satisfied, pay the Bearer Additional Amounts specified in
such paragraph. The Company will make such determination
and election and notify the Trustee and the Paying Agent in
London, England, thereof in writing as soon as practicable,
and the Trustee will promptly give notice of such
determination in the manner provided in the second following
paragraph (the "Determination Notice"), in each case stating
the effective date of such certification, identification or
information reporting requirement, whether the Company will
redeem the Bearer Securities or will pay the Bearer Addi-
tional Amounts specified in the fourth paragraph on the face
hereof and (if applicable) the last date by which the
redemption of the Bearer Securities must take place. If the
Company shall elect to redeem the Bearer Securities pursuant
to clause (x) above, such redemption shall take place on
such date, not later than one year after the publication of
the Determination Notice, as the Company shall elect by
notice given in writing to the Trustee and the Paying Agent
in London, England, at least 75 days before the Redemption
Date, unless shorter notice shall be acceptable to the
Trustee. Notwithstanding the foregoing, the Company will
not so redeem the Bearer Securities if the Company, based
upon an Opinion of Counsel, which counsel shall be
reasonably acceptable to the Trustee, subsequently
determines, not less than 30 days prior to the Redemption
Date, that subsequent payments would not be subject to any
such requirement, in which case the Company will notify the
Trustee in writing of its determination not to so redeem the
Bearer Securities, and the Trustee will promptly give notice
to the Holders of the Bearer Securities of that
determination and any earlier redemption notice will
thereupon be revoked and of no further effect. If the
Company elects as provided in clause (y) above to pay Bearer
Additional Amounts, the Company may, as long as the Company
is obligated to pay such Bearer Additional Amounts,
subsequently redeem the Bearer Securities, at any time, as a
whole but not in part, upon not less than 30 nor more than
60 days' notice prior to the Redemption Date, at a
Redemption Price equal to 100% of the principal amount
thereof plus interest accrued to the Redemption Date, and
any Additional Amounts or Bearer Additional Amounts.
In the event of a redemption of the Securities,
the Company will not be required (a) to register the
transfer or exchange of Registered Securities or to exchange
Bearer Securities for Registered Securities for a period of
15 days immediately preceding the date notice is given
identifying the serial numbers of the Securities called for
such redemption, (b) to register the transfer or exchange of
any Registered Security, or portion thereof, called for
redemption, or (c) to exchange any Bearer Security called
for redemption; provided, however, that a Bearer Security
called for redemption may be exchanged for a Registered
Security which is simultaneously surrendered to the
Registrar or Transfer Agent making such exchange with
written instructions for conversion consistent with the
provisions described in Sections 2.5 and 12.2 of the
Indenture.
Notice of redemption will be given by publication
in Authorized Newspapers in the City of London, England, or,
if not practicable in London, England, elsewhere in any
country in Western Europe. Notice to the Holders will be
given not less than 30 nor more than 60 days prior to the
Redemption Date as provided in the Indenture.
In any case where the due date for the payment of
the principal of, or premium, if any, or interest, including
Additional Amounts and Bearer Additional Amounts, on any
Security or the last day on which a Holder of a Security has
a right to convert his Security shall be, at any Place of
Payment or Place of Conversion, as the case may be, a day on
which banking institutions at such Place of Payment or Place
of Conversion are authorized or obligated by law or
executive order to close, then payment of principal,
premium, if any, or interest, including Additional Amounts
and Bearer Additional Amounts, or delivery for conversion of
such Security need not be made on or by such date at such
place but may be made on or by the next succeeding day at
such place which is not a day on which banking institutions
are authorized or obligated by law or executive order to
close, with the same force and effect as if made on the date
for such payment or the date fixed for redemption or
repurchase, or by such last day for conversion, and no
interest shall accrue on the amount so payable for the
period after such date.
Subject to and upon compliance with the provisions
of the Indenture, the Holder of this Security is entitled,
at his option, at any time on or after September 3, 1996 and
on or before the close of business on June 1, 2001, or in
case this Security is called for redemption or the Holder
hereof has exercised his right to require the Company to
repurchase this Security, then in respect of this Security
until and including, but (unless the Company defaults in
making the payment due upon redemption or repurchase, as the
case may be) not after, the close of business on the fifth
Trading Day prior to the Redemption Date or the second
Trading Day prior to the Repurchase Date, as the case may
be, to convert this Security into fully paid and
nonassessable shares of Common Stock of the Company at an
initial Conversion Price of U.S. $65.00 for each share of
Common Stock (or at the current adjusted Conversion Price if
an adjustment has been made as provided in the Indenture) by
surrender of this Security, together with all coupons apper-
taining hereto that mature after the date of conversion, and
also the conversion notice hereon, duly executed, to the
Company, subject to any laws or regulations applicable
thereto and subject to the right of the Company to terminate
the appointment of any Conversion Agent (as defined below),
at the office of Bankers Trust Company, 1 Appold Street,
Broadgate, London EC2A 2HE, England, or at such other
offices or agencies outside the United States as the Company
may designate (each a "Conversion Agent"). Subject to the
aforesaid requirement to surrender coupons and except as
provided in the Indenture, no cash payment or adjustment is
to be made on conversion, if the date of conversion is not
an Interest Payment Date, for interest accrued hereon from
the Interest Payment Date next preceding the date of
conversion, or for dividends on the Common Stock issued on
conversion hereof. The Company shall thereafter deliver to
the Holder the fixed number of shares of Common Stock
(together with any cash adjustment for fractional shares, as
provided in the Indenture) into which this Security is
convertible and such delivery will be deemed to satisfy the
Company's obligation to pay the principal amount of this
Security. No fractions of shares or scrip representing
fractions of shares will be issued on conversion, but
instead of any fractional interest (calculated to the
nearest 1/100th of a share) the Company shall pay a cash
adjustment as provided in the Indenture. The Conversion
Price is subject to adjustment as provided in the Indenture.
In addition, the Indenture provides that in case of certain
consolidations or mergers to which the Company is a party or
the transfer of all or substantially all of the property and
assets of the Company, the Indenture shall be amended,
without the consent of any Holders of Securities, so that
this Security, if then Outstanding, will be convertible
thereafter, during the period this Security shall be
convertible as specified above, only into the kind and
amount of securities, cash and other property receivable
upon such consolidation, merger or transfer by a holder of
the number of shares of Common Stock of the Company into
which this Security could have been converted immediately
prior to such consolidation, merger or transfer (assuming
such holder of Common Stock is not a Constituent Person or
an Affiliate of a Constituent Person and failed to exercise
any rights of election (and received per share the kind and
amount received per share by a plurality of Non-electing
Shares (if all Non-electing Shares do not receive the same
consideration) and further assuming, if such consolidation,
merger or transfer occurs prior to the later of September 3,
1996 and the receipt of Securities in definitive form (in
the case of Securities initially represented by a Temporary
Global Bearer Security), that the Security was convertible
at the time of such occurrence at the Conversion Price
specified above as adjusted from the issue date of such
Security to such time as provided in the Indenture). No
adjustment in the Conversion Price will be made until such
adjustment would require an increase or decrease of at least
one percent of such price, provided that any adjustment that
would otherwise be made will be carried forward and taken
into account in the computation of any subsequent adjust-
ment.
Subject to certain limitations in the Indenture,
at any time when the Company is not subject to Section 13 or
15(d) of the United States Securities Exchange Act of 1934,
as amended, upon the request of a Holder of a Restricted
Security or the holder of shares of Common Stock issued upon
conversion thereof, the Company will promptly furnish or
cause to be furnished Rule 144A Information (as defined
below) to such Holder of Restricted Securities or such
holder of shares of Common Stock issued upon conversion of
Restricted Securities, or to a prospective purchaser of any
such security designated by any such Holder or holder, as
the case may be, to the extent required to permit compliance
by any such Holder or holder with Rule 144A under the United
States Securities Act of 1933, as amended (the "Securities
Act"), in connection with the resale of any such security.
"Rule 144A Information" shall be such information as is
specified pursuant to Rule 144A(d)(4) under the Securities
Act (or any successor provision thereto).
If a Change in Control occurs, the Holder of this
Security shall have the right, in accordance with the
provisions of the Indenture, to require the Company to
repurchase this Security at a Repurchase Price equal to 100%
of the principal amount plus accrued interest to the
Repurchase Date; provided, however, that the Repurchase
Price in respect of any Bearer Security will be payable only
upon presentation and surrender of such Bearer Security at
an office or agency outside the United States, except in the
limited circumstances described in the last sentence of the
first paragraph of the face hereof. At the option of the
Company, the Repurchase Price may be paid in cash or, except
as otherwise provided in the Indenture, by delivery of
shares of common stock having a fair market value equal to
the Repurchase Price; provided that payment may not be made
in common stock unless at the time of payment such stock is
listed on a national securities exchange or quoted on the
Nasdaq National Market. For purposes of this paragraph, the
fair market value of shares of common stock shall be
determined by the Company and shall be equal to 95% of the
average of the Closing Prices Per Share for the five
consecutive Trading Days ending on and including the third
Trading Day immediately preceding the Repurchase Date.
Whenever in this Security there is a reference, in any
context, to the principal of any Security as of any time,
such reference shall be deemed to include reference to the
Repurchase Price payable in respect of such Security to the
extent that such Repurchase Price is, was or would be so
payable at such time, and express mention of the Repurchase
Price in any provision of this Security shall not be
construed as excluding the Repurchase Price in those
provisions of this Security when such express mention is not
made.
The indebtedness evidenced by this Security and
any coupons appertaining hereto is, to the extent and in the
manner provided in the Indenture, subordinate and subject in
right of payment to the prior payment in full of all Senior
Indebtedness of the Company, and this Security and each
coupon appertaining hereto is issued subject to such provi-
sions of the Indenture with respect thereto. Each Holder of
this Security or any coupon appertaining to this Security,
by accepting the same, (a) agrees to and shall be bound by
such provisions, (b) authorizes and directs the Trustee on
his behalf to take such action as may be necessary or
appropriate to effectuate the subordination so provided and
(c) appoints the Trustee his attorney-in-fact for any and
all such purposes.
If an Event of Default shall occur and be contin-
uing, the principal of all the Securities, together with
accrued interest to the date of declaration, may be declared
due and payable in the manner and with the effect provided
in the Indenture. Upon payment (i) of the amount of
principal so declared due and payable, together with accrued
interest to the date of declaration, and (ii) of interest on
any overdue principal and overdue interest, all of the
Company's obligations in respect of the payment of the
principal of and interest on the Securities shall terminate.
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 and coupons under the
Indenture at any time by the Company and the Trustee with
either (a) the written consent of the Holders of a majority
in principal amount of the Securities at the time Out-
standing, or (b) by the adoption of a resolution, at a
meeting of Holders of the Outstanding Securities at which a
quorum is present, by the Holders of (i) 66-2/3% in
principal amount of the Outstanding Securities represented
and entitled to vote at such meeting or (ii) a majority in
principal amount of the Securities at the time Outstanding.
The Indenture also contains provisions permitting the
Holders of specified percentages in principal amount of the
Securities at the time Outstanding, on behalf of the Holders
of all the Securities and coupons, 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 Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and any
coupon appertaining hereto and of any Security issued in
exchange herefor or in lieu hereof, whether or not notation
of such consent or waiver is made upon this Security or such
other Security.
As provided in and subject to the provisions of
the Indenture, the Holder of this Security or any coupon
appertaining hereto 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,
the Holders of not less than 25% in principal amount of the
Outstanding Securities 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 the
Securities 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
or any coupon appertaining hereto for the enforcement of any
payment of principal hereof, premium, if any, or interest
hereon (including any Additional Amounts and Bearer
Additional Amounts) on or after the respective due dates
expressed herein or for the enforcement of the right to
convert this Security as provided in the Indenture.
No reference herein to the Indenture and no provi-
sion 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, premium, if any, and
interest on (including Additional Amounts and Bearer
Additional Amounts, as described in the second and fourth
paragraph, respectively, on the face hereof) this Security
at the times, places and rate, and in the coin or currency,
herein prescribed or to convert this Security as provided in
the Indenture.
Title to this Security and the coupons
appertaining hereto shall pass by delivery. The Company,
the Trustee and any agent of the Company or the Trustee may
treat the bearer of this Security and any coupon
appertaining thereto as the owner thereof for all purposes,
whether or not this Security or such coupon be overdue, and
neither the Company, the Trustee nor any such agent shall be
affected by notice to the contrary.
The Indenture, the Securities and any coupons
appertaining thereto shall be governed by and construed in
accordance with the laws of the State of New York, United
States of America, without regard to the principles of
conflicts of laws.
All terms used in this Security which are defined
in the Indenture shall have the meanings assigned to them in
the Indenture.
ELECTION OF HOLDER TO REQUIRE REPURCHASE
1. Pursuant to Section 14.1 of the Indenture, the
undersigned hereby elects to have this Security repurchased
by the Company.
2. The undersigned hereby directs the Company to
pay bearer an amount in cash or, at the Company's election,
shares of common stock valued as set forth in the Indenture
equal to 100% of the principal amount hereof, plus interest
accrued to the Repurchase Date, as provided in the
Indenture.
Dated:_______________________
_______________________
Signature
(b) Form of Registered Security
[FORM OF FACE]
[THE FOLLOWING LEGEND (THE "RULE 144A LEGEND") SHALL APPEAR
ON THE FACE OF EACH RESTRICTED SECURITY:
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY
ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND THIS SECURITY AND ANY SHARES OF
COMMON STOCK ISSUABLE UPON ITS CONVERSION MAY NOT BE SOLD OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR
AN APPLICABLE EXEMPTION THEREFROM. THIS SECURITY MAY ONLY
BE SOLD IN ACCORDANCE WITH THE INDENTURE, COPIES OF WHICH
ARE AVAILABLE FOR INSPECTION AT THE CORPORATE TRUST OFFICE
OF THE TRUSTEE. EACH PURCHASER OF THIS SECURITY IS HEREBY
NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON
THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT
OF UNITED WASTE SYSTEMS, INC. (THE "COMPANY") THAT (A) THIS
SECURITY AND ANY SHARES OF COMMON STOCK ISSUABLE UPON ITS
CONVERSION MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED
ONLY (I) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER
THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (II) IN AN OFFSHORE TRANSACTION
COMPLYING WITH THE PROVISIONS OF RULE 904 OF REGULATION S
UNDER THE SECURITIES ACT, (III) IN THE CASE OF ANY PURCHASER
OTHER THAN A PURCHASER WHO HAS OTHERWISE AGREED WITH THE
COMPANY IN WRITING, TO AN INSTITUTION THAT IS AN "ACCREDITED
INVESTOR" WITHIN THE MEANING OF RULE 501(A) UNDER THE
SECURITIES ACT IN A TRANSACTION EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, (IV) PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), OR (V)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT, AND IN EACH OF CASES (I) THROUGH (V) IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF THE STATES
AND OTHER JURISDICTIONS OF THE UNITED STATES AND ANY
APPLICABLE LAWS OF JURISDICTIONS OUTSIDE OF THE UNITED
STATES, AND THAT (B) THE HOLDER WILL, AND EACH SUBSEQUENT
HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER FROM SUCH HOLDER
OF THIS SECURITY OR ANY COMMON STOCK ISSUABLE UPON ITS
CONVERSION OF THE RESALE RESTRICTIONS REFERRED TO IN (A)
ABOVE.
THIS SECURITY, ANY SHARES OF COMMON STOCK ISSUABLE
UPON ITS CONVERSION AND ANY RELATED DOCUMENTATION MAY BE
AMENDED OR SUPPLEMENTED FROM TIME TO TIME TO MODIFY THE
RESTRICTIONS ON AND PROCEDURES FOR RESALES AND OTHER
TRANSFERS OF THIS SECURITY AND ANY SUCH SHARES TO REFLECT
ANY CHANGE IN APPLICABLE LAW OR REGULATION (OR THE
INTERPRETATION THEREOF) OR IN PRACTICES RELATING TO THE
RESALE OR TRANSFER OF RESTRICTED SECURITIES GENERALLY. THE
HOLDER OF THIS SECURITY AND ANY SUCH SHARES SHALL BE DEEMED
BY THE ACCEPTANCE OF THIS SECURITY AND ANY SUCH SHARES TO
HAVE AGREED TO ANY SUCH AMENDMENT OR SUPPLEMENT.]
[THE FOLLOWING LEGEND SHALL APPEAR ON THE FACE OF EACH
REGISTERED SECURITY ISSUED IN THE NAME OF CEDE & CO.:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A
NEW YORK CORPORATION ("DTC"), TO THE COMPANY OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO.
OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO.
OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE &
CO., HAS AN INTEREST HEREIN].
UNITED WASTE SYSTEMS, INC.
4-1/2% CONVERTIBLE SUBORDINATED NOTE
DUE JUNE 1, 2001
No. _____________ U.S.$_____
CUSIP No. ____________
UNITED WASTE SYSTEMS, INC., a corporation duly
organized and existing under the laws of the State of
Delaware (herein called the "Company", which term includes
any successor Person under the Indenture referred to on the
reverse hereof), for value received, hereby promises to pay
to _______________, or registered assigns, the principal sum
of _____________ United States Dollars (U.S. $_____________)
(which amount may, if this Security is registered in the
name of the Depositary or a nominee thereof, from time to
time be increased or decreased by adjustments made on the
records of the Trustee, as custodian of the Depositary, in
accordance with the rules and procedures of the Depositary)
on June 1, 2001 and to pay interest thereon, from June 5,
1996, or from the most recent Interest Payment Date (as
defined below) to which interest has been paid or duly
provided for, semi-annually in arrears on June 1 and
December 1 in each year (each, an "Interest Payment Date"),
commencing December 1, 1996, at the rate of 4-1/2% per annum,
until the principal hereof is due, and at the rate of 4-1/2%
per annum on any overdue principal and premium, if any, and,
to the extent permitted by law, on any overdue interest.
The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided
in the 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 Record Date for
such interest, which shall be the May 15 or November 15
(whether or not a Business Day) next preceding such Interest
Payment Date. Except as otherwise provided in the
Indenture, 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 Company, notice
whereof shall be given to Holders of Registered Securities
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 may be listed, and upon
such notice as may be required by such exchange, all as more
fully provided in the Indenture. Payments of principal
shall be made upon the surrender of this Security at the
option of the Holder at the Corporate Trust Office of the
Trustee, or at such other office or agency of the Company as
may be designated by it for such purpose in the Borough of
Manhattan, The City of New York, in such coin or currency of
the United States of America as at the time of payment shall
be legal tender for the payment of public and private debts,
by United States Dollar check drawn on, or transfer to a
United States Dollar account (such a transfer to be made
only to a Holder of an aggregate principal amount of
Securities in excess of U.S. $2,000,000, and only if such
Holder shall have furnished wire instructions in writing to
the Trustee no later than 15 days prior to the relevant
payment date) maintained by the Holder with a bank in the
Borough of Manhattan, The City of New York. Payment of
interest on this Security may be made by United States
Dollar check drawn on a bank in the Borough of Manhattan,
The City of New York mailed to the address of the Person
entitled thereto as such address shall appear in the
Security Register, or, upon written application by the
Holder to the Security Registrar setting forth wire
instructions not later than the relevant Regular Record
Date, by transfer to a United States Dollar account (such a
transfer to be made only to a Holder of an aggregate
principal amount of Securities in excess of U.S.$2,000,000)
maintained by the Holder with a bank in the Borough of
Manhattan, The City of New York.
The Company will pay to the Holder of this
Security who is not a United States person (as defined
below) such additional amounts ("Additional Amounts") as may
be necessary in order that every net payment of the
principal of, premium, if any, and interest on this Security
(including payment on redemption or repurchase), after
deduction or withholding for or on account of any present or
future tax, assessment or governmental charge imposed upon
or as a result of such payment by the United States or any
political subdivision or taxing authority thereof or there-
in, will not be less than the amount provided for in this
Security to be then due and payable; provided, however, that
the foregoing obligation to pay Additional Amounts will not
apply to:
(a) any tax, assessment or other governmental
charge which would not have been so imposed but for
(i) the existence of any present or former connection
between such Holder (or between a fiduciary, settlor,
beneficiary, member, shareholder of or possessor of a
power over such Holder, if such Holder is an estate, a
trust, a partnership or a corporation) and the United
States or any political subdivision or taxing authority
thereof or therein, including, without limitation, such
Holder (or such fiduciary, settlor, beneficiary,
member, shareholder or possessor) being or having been
a citizen or resident of the United States or treated
as a resident thereof, or being or having been engaged
in trade or business or present therein, or having or
having had a permanent establishment therein, or (ii)
such Holder's present or former status as a personal
holding company, a foreign personal holding company
with respect to the United States, a controlled foreign
corporation, a passive foreign investment company, or a
foreign private foundation or foreign tax exempt entity
for United States tax purposes, or a corporation which
accumulates earnings to avoid United States Federal
income tax;
(b) any tax, assessment or other governmental
charge which would not have been so imposed but for the
presentation by the Holder of this Security for payment
on a date more than 15 days after the date on which
such payment became due and payable or the date on
which payment thereof is duly provided for, whichever
occurs later;
(c) any estate, inheritance, gift, sales,
transfer, personal property or similar tax, assessment
or governmental charge;
(d) any tax, assessment or other governmental
charge which would not have been imposed but for the
failure to comply with any certification,
identification or other reporting requirements
concerning the nationality, residence, identity or
connection with the United States of the Holder or
beneficial owner of this Security, if compliance is
required by statute or by regulation or ruling of the
United States Treasury Department as a precondition to
exemption from such tax, assessment or other
governmental charge;
(e) any tax, assessment or other governmental
charge which is payable otherwise than by deduction or
withholding from payments of principal of, premium, if
any, or interest on this Security;
(f) any tax, assessment or other governmental
charge imposed as a result of a Person's past or
present actual or constructive ownership, including by
virtue of the right to convert Securities, of 10% or
more of the total combined voting power of all classes
of stock of the Company entitled to vote;
(g) any tax, assessment or other governmental
charge required to be withheld by any Paying Agent from
any payment of the principal of, premium, if any, or
interest on this Security, if such payment can be made
without such withholding by any other Paying Agent in
Western Europe;
(h) any tax, assessment or other governmental
charge imposed on a Holder that is a partnership or a
fiduciary, but only to the extent that any beneficial
owner or member of the partnership or beneficiary or
settlor with respect to the fiduciary would not have
been entitled to the payment of Additional Amounts had
the beneficial owner, member, beneficiary or settlor
directly received its beneficial or distributive share
of payments on this Security;
(i) any tax, assessment or other governmental
charge which would not have been imposed but for the
fact that this Security constitutes a "United States
real property interest", as defined in Section
897(c)(1) of the United States Internal Revenue Code of
1986, as amended, and the regulations thereunder, with
respect to the beneficial owner of this Security; or
(j) any combination of items (a), (b), (c), (d),
(e), (f), (g), (h) and (i).
For purposes of this Security, a "United States
person" is a Person that is, for United States Federal
income tax purposes, (a) a citizen or resident of the
United States, (b) a corporation, partnership or other
entity created or organized in or under the laws of the
United States or any political subdivision thereof or (c) an
estate or trust the income of which is subject to
United States Federal income taxation regardless of source.
Solely for purposes of the foregoing definition of "United
States person", the term "United States" shall include, when
used in the geographical sense, only the States thereof and
the District of Columbia.
Except as specifically provided herein and in the
Indenture, the Company shall not be required to make any
payment with respect to any tax, assessment or other govern-
mental charge imposed by any government or any political
subdivision or taxing authority thereof or therein.
Whenever in this Security there is a reference, in any
context, to the payment of the principal of, premium, if
any, or interest on, or in respect of, any Security such
mention shall be deemed to include mention of the payment of
Additional Amounts payable as described in the second
preceding paragraph to the extent that, in such context,
Additional Amounts are, were or would be payable in respect
of this Security pursuant to such paragraph and express
mention of the payment of Additional Amounts (if applicable)
in any provisions of this Security shall not be construed as
excluding Additional Amounts in those provisions of this
Security where such express mention is not made.
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 or an Authenticating Agent by the manual signature of
one of their respective authorized signatories, this
Security shall not be entitled to any benefit under the
Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this
Security to be duly executed.
Dated:
UNITED WASTE SYSTEMS, INC.
By:_____________________________
Name:
Title:
Attest:
________________________
Name:
Title:
[FORM OF REVERSE]
This Security is one of a duly authorized issue of
securities of the Company designated as its "4-1/2% Convertible
Subordinated Notes due June 1, 2001" (herein called the
"Securities"), limited in aggregate principal amount to
U.S.$150,000,000, issued and to be issued under an
Indenture, dated as of June 5, 1996 (herein called the
"Indenture"), between the Company and Bankers Trust Company,
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, the holders of Senior Indebtedness
and the Holders of the Securities and any coupons
appertaining thereto and of the terms upon which the
Securities are, and are to be, authenticated and delivered.
The Securities are issuable as Bearer Securities, with
interest coupons attached, in the denomination of
U.S.$5,000, and as Registered Securities, without coupons,
in denominations of U.S.$1,000 and integral multiples of
U.S.$1,000 in excess thereof. As provided in the Indenture
and subject to certain limitations therein set forth,
Registered Securities are exchangeable for a like aggregate
principal amount of Registered Securities of any authorized
denominations as requested by the Holder surrendering the
same upon surrender of the Registered Security or Registered
Securities to be exchanged, at the Corporate Trust Office of
the Trustee or at such other office or agency of the Company
as may be designated by it for such purpose in the Borough
of Manhattan, The City of New York or at such other offices
or agencies as the Company may designate (each a "Transfer
Agent"). The Transfer Agent (if other than the Trustee)
will then forward such surrendered Registered Securities
(together with any payment surrendered therewith) to the
Trustee. The Trustee upon such surrender by the Holder or
receipt from the Transfer Agent will issue the new
Registered Securities in the requested denominations.
Bearer Securities may not be issued in exchange for
Registered Securities.
No sinking fund is provided for the Securities.
The Securities are subject to redemption at the option of
the Company at any time on or after June 1, 1999, in whole
or in part, upon not less than 30 nor more than 60 days'
notice to the Holders prior to the Redemption Date at a
Redemption Price equal to 101.8% of the principal amount if
redeemed prior to June 1, 2000 and at a Redemption Price
equal to 100.9% of the principal amount, if redeemed on or
after June 1, 2000, together, in each case, with accrued
interest to the Redemption Date, and Securities held by non-
United States persons are also redeemable, in whole but not
in part, under the circumstances described in the next suc-
ceeding paragraph, at a Redemption Price equal to 100% of
the principal amount thereof plus interest accrued to the
Redemption Date; provided, however, that interest
installments on Registered Securities whose Stated Maturity
is on or prior to such Redemption Date will be payable to
the Holders of such Securities, or one or more Predecessor
Securities, of record at the close of business on the
relevant Record Dates referred to on the face hereof, all as
provided in the Indenture.
If as a result of a Tax Law Change, the Company
has or will become obligated to pay to the Holder of any
Security or coupon Additional Amounts, as described in the
second paragraph of the face of this Security, and such
obligation cannot be avoided by the Company taking
reasonable measures available to it, then the Company may,
at its option, redeem the Tax Affected Securities as a
whole, but not in part, upon not less than 30 nor more than
60 days' notice to the Holders prior to the Redemption Date,
at a Redemption Price equal to 100% of the principal amount
plus interest accrued to the Redemption Date, and any
Additional Amounts then payable; provided, that (i) no such
notice of redemption shall be given earlier than 90 days
prior to the earliest date on which the Company would be
obligated to pay any such Additional Amounts were a payment
in respect of the Tax Affected Securities then due and
(ii) at the time such notice of redemption is given, such
obligation to pay such Additional Amounts remains in effect.
Prior to the publication of any notice of redemption
pursuant to this paragraph, the Company shall deliver to the
Trustee (a) an Officers' Certificate stating that the
Company is entitled to effect such redemption and setting
forth a statement of facts showing that the conditions
precedent to the right of the Company so to redeem have
occurred and (b) an Opinion of Counsel selected by the
Company to the effect that the Company has or will become
obligated to pay such Additional Amounts as a result of such
Tax Law Change. The Company's right to redeem the Tax
Affected Securities shall continue as long as the Company is
obligated to pay such Additional Amounts, notwithstanding
that the Company shall have made payments of Additional
Amounts specified in such second paragraph.
In the event of a redemption of less than all of
the Securities (other than a redemption that by its terms is
applicable solely to Bearer Securities), the Company will
not be required (a) to register the transfer or exchange of
Registered Securities or to exchange Bearer Securities for
Registered Securities for a period of 15 days immediately
preceding the date notice is given identifying the serial
numbers of the Securities called for such redemption, (b) to
register the transfer or exchange of any Registered
Security, or portion thereof, called for redemption, or (c)
to exchange any Bearer Security called for redemption;
provided, however, that a Bearer Security called for
redemption may be exchanged for a Registered Security which
is simultaneously surrendered to the Registrar or Transfer
Agent making such exchange with written instructions for
conversion consistent with the provisions described in
Sections 2.5 and 12.2 of the Indenture.
Notice of redemption will be given by publication
in Authorized Newspapers in the City of London, England, or,
if not practicable in London, England, elsewhere in any
country in Western Europe, and by mail to Holders of
Registered Securities. Notice to the Holders will be given
not less than 30 nor more than 60 days prior to the
Redemption Date as provided in the Indenture.
In any case where the due date for the payment of
the principal of, premium, if any, or interest, including
Additional Amounts and Liquidated Damages, on any Security
or the last day on which a Holder of a Security has a right
to convert his Security shall be, at any Place of Payment or
Place of Conversion, as the case may be, a day on which
banking institutions at such Place of Payment or Place of
Conversion are authorized or obligated by law or executive
order to close, then payment of principal, premium, if any,
or interest, including Additional Amounts and Liquidated
Damages, or delivery for conversion of such Security need
not be made on or by such date at such place but may be made
on or by the next succeeding day at such place which is not
a day on which banking institutions are authorized or
obligated by law or executive order to close, with the same
force and effect as if made on the date for such payment or
the date fixed for redemption or repurchase, or by such last
day for conversion, and no interest shall accrue on the
amount so payable for the period after such date.
Subject to and upon compliance with the provisions
of the Indenture, the Holder of this Security is entitled,
at his option, at any time on or after September 3, 1996,
and on or before the close of business on June 1, 2001, or
in case this Security or a portion hereof is called for
redemption or the Holder hereof has exercised his right to
require the Company to repurchase this Security or such
portion hereof, then in respect of this Security until and
including, but (unless the Company defaults in making the
payment due upon redemption or repurchase, as the case may
be) not after, the close of business on the fifth Trading
Day prior to Redemption Date or the second Trading Day prior
to the Repurchase Date, as the case may be, to convert this
Security (or any portion of the principal amount hereof that
is an integral multiple of U.S.$1,000, provided that the
unconverted portion of such principal amount is U.S.$1,000
or any integral multiple of U.S.$1,000 in excess thereof)
into fully paid and nonassessable shares of Common Stock of
the Company at an initial Conversion Price of U.S.$65.00 for
each share of Common Stock (or at the current adjusted
Conversion Price if an adjustment has been made as provided
in the Indenture) by surrender of this Security, duly
endorsed or assigned to the Company or in blank and, in case
such surrender shall be made during the period from the
close of business of any Regular Record Date next preceding
any Interest Payment Date to the opening of business on such
Interest Payment Date ("Interest Period"), also accompanied
by payment in New York Clearing House or other funds
acceptable to the Company of an amount equal to the interest
payable on such Interest Payment Date on the principal
amount of this Security then being converted (or, if this
Security was issued in exchange for a Bearer Security after
the close of business on such Regular Record Date, by sur-
render of one or more coupons relating to such Interest Pay-
ment Date or by both payment in such funds and surrender of
such coupon or coupons, in either case, in an amount equal
to the interest payable on such Interest Payment Date on the
principal amount of this Security then being converted;
provided that coupons may be so surrendered only at an
office or agency outside the United States designated
pursuant to the Indenture), and also the conversion notice
hereon duly executed, to the Company at the Corporate Trust
Office of the Trustee, or at such other office or agency of
the Company, subject to any laws or regulations applicable
thereto and subject to the right of the Company to terminate
the appointment of any Conversion Agent (as defined below)
as may be designated by it for such purpose in the Borough
of Manhattan, The City of New York, or at such other offices
or agencies as the Company may designate (each a "Conversion
Agent"). Subject to the aforesaid requirement for payment
and, in the case of a conversion after the Regular Record
Date next preceding any Interest Payment Date and on or
before such Interest Payment Date, to the right of the
Holder of this Security (or any Predecessor Security) of
record at such Regular Record Date to receive the related
installment of interest on the related Interest Payment
Date, no cash payment or adjustment is to be made on
conversion, if the date of conversion is not an Interest
Payment Date, for interest accrued hereon from the Interest
Payment Date next preceding the date of conversion, or for
dividends on the Common Stock issued on conversion hereof.
The Company shall thereafter deliver to the Holder the fixed
number of shares of Common Stock (together with any cash
adjustment for fractional shares, as provided in the
Indenture) into which this Security is convertible and such
delivery will be deemed to satisfy the Company's obligation
to pay the principal amount of this Security. No fractions
of shares or scrip representing fractions of shares will be
issued on conversion, but instead of any fractional interest
(calculated to the nearest 1/100th of a share) the Company
shall pay a cash adjustment as provided in the Indenture.
The Conversion Price is subject to adjustment as provided in
the Indenture. In addition, the Indenture provides that in
case of certain consolidations or mergers to which the
Company is a party or the transfer of all or substantially
all of the property and assets of the Company, the Indenture
shall be amended, without the consent of any Holders of
Securities, so that this Security, if then Outstanding, will
be convertible thereafter, during the period this Security
shall be convertible as specified above, only into the kind
and amount of securities, cash and other property receivable
upon such consolidation, merger or transfer by a holder of
the number of shares of Common Stock of the Company into
which this Security could have been converted immediately
prior to such consolidation, merger or transfer (assuming
such holder of Common Stock is not a Constituent Person or
an Affiliate of a Constituent Person and failed to exercise
any rights of election (and received per share the kind and
amount received per share by a plurality of Non-electing
Shares, if all Non-electing Shares do not receive the same
consideration) and further assuming, if such consolidation,
merger or transfer occurs prior to the later of September 3,
1996 and the receipt of Securities in definitive form (in
the case of Securities initially represented by a Temporary
Global Bearer Security), that the Security was convertible
at the time of such occurrence at the Conversion Price
specified above as adjusted from the issue date of such
Security to such time as provided in the Indenture). No
adjustment in the Conversion Price will be made until such
adjustment would require an increase or decrease of at least
one percent of such price, provided that any adjustment that
would otherwise be made will be carried forward and taken
into account in the computation of any subsequent
adjustment.
Subject to certain limitations in the Indenture,
at any time when the Company is not subject to Section 13 or
15(d) of the United States Securities Exchange Act of 1934,
as amended, upon the request of a Holder of a Restricted
Security or the holder of shares of Common Stock issued upon
conversion thereof, the Company will promptly furnish or
cause to be furnished Rule 144A Information (as defined
below) to such Holder of Restricted Securities or such
holder of shares of Common Stock issued upon conversion of
Restricted Securities, or to a prospective purchaser of any
such security designated by any such Holder or holder, as
the case may be, to the extent required to permit compliance
by such Holder or holder with Rule 144A under the Securities
Act of 1933, as amended (the "Securities Act"), in
connection with the resale of any such security. "Rule 144A
Information" shall be such information as is specified
pursuant to Rule 144A(d)(4) under the Securities Act (or any
successor provision thereto).
The Holder of this Security (including, if this
Security is registered in the name of the Depositary or a
nominee thereof, any Person that has a beneficial interest
in this Security), and the Common Stock issuable upon
conversion thereof is entitled to the benefits of a
Registration Rights Agreement, dated as of June 5, 1996 (the
"Registration Rights Agreement"), between the Company and
Goldman Sachs International. Pursuant to the Registration
Rights Agreement, the Company has agreed for the benefit of
the Holders from time to time of Registered Securities and
the Common Stock issuable upon conversion thereof that it
will (a) within 90 days after the date of original issuance
of the Registered Securities, file a shelf registration
statement (the "Shelf Registration Statement") with the
Commission with respect to resales of the Registered
Securities and the Common Stock issuable upon conversion
thereof and (b) use its reasonable best efforts to cause
such Shelf Registration Statement to be declared effective
by the Commission within 90 days after the date on which the
Shelf Registration Statement is filed.
If (i) on or prior to 90 days following the date
of original issuance of the Registered Securities, a Shelf
Registration Statement has not been filed with the
Commission, or (ii) on or prior to the 90th day following
the filing of such Shelf Registration Statement, such Shelf
Registration Statement is not declared effective (each, a
"Registration Default"), additional interest ("Liquidated
Damages") will accrue on this Security from and including
the day following such Registration Default to but excluding
the day on which such Registration Default has been cured.
Liquidated Damages will be paid semi-annually in arrears,
commencing with the first Interest Payment Date immediately
succeeding the date of such Registration Default, at a rate
per annum equal to one-quarter of one percent (0.25%) of the
principal amount of this Security, to and including the 90th
day following such Registration Default and at a rate per
annum equal to one-half of one percent (0.50%) thereof from
and after the 91st day following such Registration Default.
In the event that, during the period that the Company is
required to maintain the effectiveness of the Shelf
Registration Statement pursuant to the Registration Rights
Agreement, the Shelf Registration Statement ceases to be
effective (or the Holders are otherwise restricted or
prevented by the Company from making sales pursuant to the
Shelf Registration Statement) prior to the time that an
opinion of counsel shall be delivered to the Trustee to the
effect that the Registered Securities may be sold by non-
affiliates of the Company pursuant to Rule 144(k) and the
legends set forth in Section 2.6 are removed from such
Registered Securities or such earlier date as is provided in
the Registration Rights Agreement for a period in excess of
60 days, whether or not consecutive, during any 12-month
period (an "Effectiveness Failure"), then additional
interest shall accrue on this Security from and including
the 61st day of the applicable 12-month period such Shelf
Registration Statement ceases to be effective (or the
Holders are otherwise restricted or prevented by the Company
from making sales pursuant thereto) to but excluding the day
on which the Effectiveness Failure is cured, at a rate per
annum equal to an additional one-half of one percent (0.50%)
of the principal amount of this Security, such additional
interest to be payable on the same basis as if it were
Liquidated Damages. For the purpose of determining whether
an Effectiveness Failure has occurred, any day on which the
Company has been obligated to pay additional interest in
accordance with the immediately preceding sentence in
respect of a prior Effectiveness Failure shall not be
included within the applicable 60 days.
Whenever in this Security there is a reference, in
any context, to the payment of the principal of, premium, if
any, or interest on, or in respect of, any Registered
Security such mention shall be deemed to include mention of
the payment of Liquidated Damages and other additional
interest payable as described in the preceding paragraph to
the extent that, in such context, Liquidated Damages or such
other additional interest is, was or would be payable in
respect of such Security and express mention of the payment
of Liquidated Damages or such other additional interest in
any provisions of this Security shall not be construed as
excluding Liquidated Damages or such other additional
interest in those provisions of this Security where such
express mention is not made.
The Holder of this Security (including, if this
Security is registered in the name of the Depositary or a
nominee thereof, any Person that has a beneficial interest
in this Security), by its acceptance thereof, agrees to be
bound by the terms of the Registration Rights Agreement
relating to the Registered Securities and the Common Stock
issuable upon conversion thereof.
If a Change in Control occurs, the Holder of this
Security shall have the right, in accordance with the
provisions of the Indenture, to require the Company to
repurchase this Security (or any portion of the principal
amount hereof that is an integral multiple of $1,000,
provided that the portion of the principal amount of this
Security to be Outstanding after such repurchase is at least
equal to U.S.$5,000) for cash at a Repurchase Price equal to
100% of the principal amount thereof plus interest accrued
to the Repurchase Date. At the option of the Company, the
Repurchase Price may be paid in cash or, except as otherwise
provided in the Indenture, by delivery of shares of common
stock having a fair market value equal to the Repurchase
Price; provided that payment may not be made in common stock
unless at the time of payment such stock is listed on a
national securities exchange or quoted on the Nasdaq
National Market. For purposes of this paragraph, the fair
market value of shares of common stock shall be determined
by the Company and shall be equal to 95% of the average of
the Closing Prices Per Share for the five consecutive
Trading Days ending on and including the third Trading Day
immediately preceding the Repurchase Date. Whenever in this
Security there is a reference, in any context, to the
principal of any Security as of any time, such reference
shall be deemed to include reference to the Repurchase Price
payable in respect of such Security to the extent that such
Repurchase Price is, was or would be so payable at such
time, and express mention of the Repurchase Price in any
provision of this Security shall not be construed as
excluding the Repurchase Price in those provisions of this
Security when such express mention is not made.
In the event of redemption, repurchase or
conversion of this Security in part only, a new Registered
Security or Securities for the unredeemed, unrepurchased or
unconverted portion hereof will be issued in the name of the
Holder hereof.
If this Security is registered in the name of the
Depositary or a nominee thereof, in the event of a deposit
or withdrawal of an interest in this Security, including an
exchange, transfer, redemption, repurchase or conversion of
this Security in part only, the Trustee, as custodian of the
Depositary, shall make an adjustment on its records to
reflect such deposit or withdrawal in accordance with the
Applicable Procedures.
The indebtedness evidenced by this Security is, to
the extent and in the manner provided in the Indenture,
subordinate and subject in right of payment to the prior
payment in full of all Senior Indebtedness of the Company,
and this Security is issued subject to such provisions of
the Indenture with respect thereto. Each Holder of this
Security, by accepting the same, (a) agrees to and shall be
bound by such provisions, (b) authorizes and directs the
Trustee on his behalf to take such action as may be
necessary or appropriate to effectuate the subordination so
provided and (c) appoints the Trustee his attorney-in-fact
for any and all such purposes.
If an Event of Default shall occur and be contin-
uing, the principal of all the Securities, together with
accrued interest to the date of declaration, may be declared
due and payable in the manner and with the effect provided
in the Indenture. Upon payment (i) of the amount of
principal so declared due and payable, together with accrued
interest to the date of declaration, and (ii) of interest on
any overdue principal and overdue interest, all of the
Company's obligations in respect of the payment of the
principal of and interest on the Securities shall terminate.
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 and coupons under the
Indenture at any time by the Company and the Trustee with
either (a) the written consent of the Holders of a majority
in principal amount of the Securities at the time Out-
standing, or (b) by the adoption of a resolution, at a
meeting of Holders of the Outstanding Securities at which a
quorum is present, by the Holders of (i) 66-2/3% in
principal amount of the Outstanding Securities represented
and entitled to vote at such meeting or (ii) a majority in
principal amount of the Securities at the time Outstanding.
The Indenture also contains provisions permitting the
Holders of specified percentages in principal amount of the
Securities at the time Outstanding, on behalf of the Holders
of all the Securities and coupons, 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 Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of
any Security issued in exchange herefor or in lieu hereof,
whether or not notation of such consent or waiver is made
upon this Security or such other 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, the Holders of not less than
25% in principal amount of the Outstanding Securities 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 the Securities 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, premium, if any, or interest hereon (including any
Additional Amounts, Liquidated Damages or other additional
interest) on or after the respective due dates expressed
herein or for the enforcement of the right to convert this
Security as provided in the Indenture.
No reference herein to the Indenture and no provi-
sion 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, premium, if any, and
interest on (including Additional Amounts, Liquidated
Damages and other additional interest, as described herein)
this Security at the times, places and rate, and in the coin
or currency, herein prescribed or to convert this Security
as provided in the Indenture.
As provided in the Indenture and subject to
certain limitations therein set forth, the transfer of
Registered Securities is registrable on the Security
Register upon surrender of a Registered Security for
registration of transfer (a) at the Corporate Trust Office
of the Trustee or at such other office or agency of the
Company as may be designated by it for such purpose in the
Borough of Manhattan, The City of New York, or (b) subject
to any laws or regulations applicable thereto and to the
right of the Company to terminate the appointment of any
Transfer Agent, at the offices of the Transfer Agents
described herein or at such other offices or agencies as the
Company may designate, 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 thereof or his attorney duly authorized in writing,
and thereupon one or more new Registered Securities, of
authorized denominations and for the same aggregate
principal amount, will be issued to the designated
transferee or transferees by the Registrar. 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 recover any tax or other governmental charge
payable in connection therewith.
Prior to due presentation of a Registered Security
for registration of transfer, the Company, the Trustee and
any agent of the Company or the Trustee may treat the Person
in whose name such Registered Security is registered, as the
owner thereof for all purposes, whether or not such Security
be overdue, and neither the Company, the Trustee nor any
such agent shall be affected by notice to the contrary.
The Indenture and this Security shall be governed
by and construed in accordance with the laws of the State of
New York, United States of America, without regard to the
principles of conflicts of laws.
All terms used in this Security which are defined
in the Indenture shall have the meanings assigned to them in
the Indenture.
ELECTION OF HOLDER TO REQUIRE REPURCHASE
1. Pursuant to Section 14.1 of the Indenture, the
undersigned hereby elects to have this Security repurchased
by the Company.
2. The undersigned hereby directs the Trustee, as
Paying Agent, or the Company to pay it or __________________
an amount in cash or, at the Company's election, common
stock valued as set forth in the Indenture, equal to 100% of
the principal amount to be repurchased (as set forth below),
plus interest accrued to the Repurchase Date, as provided in
the Indenture.
Dated: _______________________
_______________________
Signature
_______________________
Signature Guaranteed
Principal amount to be repurchased
(an integral multiple of U.S.$5,000): ______________________
Remaining principal amount following such repurchase
(not less than U.S.$1,000): ______________________
NOTICE: The signature to the foregoing Election must
correspond to the Name as written upon the face of this
Security in every particular, without alteration or any
change whatsoever.
(c) Form of Temporary Global Bearer Security
ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE
SUBJECT TO LIMITATIONS UNDER THE UNITED STATES INCOME TAX
LAWS, INCLUDING THE LIMITATIONS PROVIDED IN SECTIONS 165(j)
AND 1287(a) OF THE INTERNAL REVENUE CODE.
UNITED WASTE SYSTEMS, INC.
4-1/2% CONVERTIBLE SUBORDINATED NOTES
DUE JUNE 1, 2001
TEMPORARY GLOBAL BEARER SECURITY
ISIN No. ____________
UNITED WASTE SYSTEMS, INC., a corporation duly
organized and existing under the laws of the State of
Delaware (herein called the "Company", which term includes
any successor Person under the Indenture hereinafter
referred to), for value received, hereby promises to pay to
bearer upon presentation and surrender of this Temporary
Global Bearer Security the principal sum of _____________
United States Dollars (U.S.$__________) on June 1, 2001, and
to pay interest thereon, from June 5, 1996, or from the most
recent Interest Payment Date (as defined below) to which
interest has been paid or duly provided for, semi-annually
in arrears on June 1 and December 1 in each year (each an
"Interest Payment Date"), commencing December 1, 1996, at
the rate of 4-1/2% per annum, until the principal hereof is due
and at the rate of 4-1/2% per annum on any overdue principal
and, to the extent permitted by law, on any overdue
interest; provided, however, that interest on this Temporary
Global Bearer Security shall be payable only after the
issuance of the Definitive Securities in bearer form for
which this Temporary Global Bearer Security is exchangeable
and, in the case of Definitive Securities in bearer form,
only upon presentation and surrender (at an office or agency
outside the United States, except as otherwise provided in
the Indenture) of the interest coupons thereto attached as
they severally mature.
This Temporary Global Bearer Security is one of a
duly authorized issue of Securities of the Company
designated as specified in the title hereof, issued and to
be issued under the Indenture, dated as of June 5, 1996
(herein called the "Indenture"), between the Company and
Bankers Trust Company, as Trustee. This Temporary Global
Bearer Security is a temporary security and is exchangeable
in whole or from time to time in part without charge upon
request of the holder hereof for Definitive Securities in
bearer form, with interest coupons attached, of authorized
denominations, (a) not earlier than 40 days after June 5,
1996 and (b) as promptly as practicable following
presentation of certification, in one of the forms set forth
in the Indenture for such purpose, that the beneficial owner
or owners of this Temporary Global Bearer Security (or, if
such exchange is only for a part of this Temporary Global
Bearer Security, of such part) are not United States
persons, are persons described in Section 1.163-
5(c)(2)(i)(D)(6) of the United States Treasury Regulations
or are financial institutions that are holding such Security
for resale during the restricted period (as defined in
Section 1.163-5(c)(2)(i)(D)(7) of the United States Treasury
Regulations) and that have not acquired such Securities for
purposes of resale directly or indirectly to a United States
person or within the United States. Definitive Securities
in bearer form to be delivered in exchange for any part of
this Temporary Global Bearer Security shall be delivered
only outside the United States. Upon any exchange of a part
of this Temporary Global Bearer Security for Definitive
Securities, the portion of the principal amount hereof so
exchanged shall be endorsed by the Paying Agent in London or
its agent on the Schedule hereto, and the principal amount
hereof shall be reduced for all purposes by the amount so
exchanged.
Until exchanged in full for definitive Securities,
this Temporary Global Bearer Security shall in all respects
be entitled to the same benefits under, and subject to the
same terms and conditions of, the Indenture as Bearer
Securities authenticated and delivered thereunder, except
that neither the Holder hereof nor the beneficial owners of
this Temporary Global Bearer Security shall be entitled to
receive payment of interest or other payments hereon or to
convert this Temporary Global Bearer Security into Common
Stock of the Company or any other security, cash or other
property.
The Indenture and this Temporary Global Bearer
Security shall be governed by and construed in accordance
with the laws of the State of New York, United States of
America, without regard to the principles of conflicts of
laws.
All terms used in this Temporary Global Bearer
Security which are defined in the Indenture shall have the
meanings assigned to them in the Indenture.
Unless the certificate of authentication hereon
has been executed by the Trustee or an Authenticating Agent
by the manual signature of one of their respective
authorized signatories, this Temporary Global Bearer
Security shall not be entitled to any benefit under the
Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this
Temporary Global Bearer Security to be duly executed.
Dated as of June 5, 1996
UNITED WASTE SYSTEMS, INC.
By:___________________________
Name:
Title:
Attest:
____________________________
Name:
Title:
<TABLE>
<CAPTION> SCHEDULE OF EXCHANGES
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Prinicpal Amount Remaining Principal Notation
Made on Behalf
Date Exhanged Amount Following
Paying Agent
Made Bearer Secuities Such Exchange in
London, England
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<PAGE>
SECTION 2.3. Form of Coupon.
[FORM OF FACE]
ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE
SUBJECT TO LIMITATIONS UNDER THE UNITED STATES INCOME TAX
LAWS, INCLUDING THE LIMITATIONS PROVIDED IN SECTIONS 165(j)
AND 1287(a) OF THE INTERNAL REVENUE CODE.
No.- _______________
ISIN No. ________________
UNITED WASTE SYSTEMS, INC.
U.S.$ _______
Due ________ __, ____
4-1/2% CONVERTIBLE SUBORDINATED NOTE
DUE JUNE 1, 2001
Unless the Security to which this coupon appertains
shall have been redeemed, repurchased or converted prior to
the date set forth hereon, United Waste Systems, Inc. (the
"Company") shall, subject to and in accordance with the terms
and conditions of such Security and the Indenture referred to
therein, pay to the bearer on the date set forth hereon, upon
surrender hereof, the amount shown hereon (together with any
Additional Amounts and any Bearer Additional Amounts payable
in respect thereof which the Company may be required to pay
according to the terms of said Security) at the paying
agencies set out on the reverse hereof or at such other places
outside the United States of America (including the States
thereof and the District of Columbia), its territories, its
possessions and other areas subject to its jurisdiction as the
Company may determine from time to time.
[REVERSE OF COUPON]
TRANSFER, PAYING AND CONVERSION AGENTS
_____________________ _________________________
_____________________
_____________________ _________________________
_____________________ _________________________
London ________
England
SECTION 2.4. Form of Certificate of Authentication.
The Trustee's certificates of authentication shall
be in substantially the following form:
This is one of the Securities referred to in the
within-mentioned Indenture.
Dated: _______________*
Bankers Trust Company,
as Trustee
[By Authenticating Agent,
as Authenticating Agent]**
By:___________________________
Authorized Signatory
* For Registered Securities only.
**For the Temporary Global Bearer Security or Bearer
Securities in definitive form.
SECTION 2.5. Form of Conversion Notice.
CONVERSION NOTICE
(a) For Bearer Securities:
The undersigned Holder of this Security hereby
irrevocably exercises the option to convert this Security into
shares of Common Stock in accordance with the terms of the
Indenture referred to in this Security and directs that such
shares be registered in the name of and delivered, together
with a check in payment for any fractional share, to the
undersigned unless a different name has been indicated below.
The address for payment of any such check must be outside the
United States. If shares are to be registered in the name of
a Person other than the undersigned, the undersigned will pay
all transfer taxes payable with respect thereto. All coupons
maturing after the date of conversion are attached.
Dated: ___________________ _________________________
Signature
If shares are to be registered
in the name of and delivered to
a Person other than the Holder,
please print such Person's name
and address:
______________________________
Name
Please print name and address
of Holder:
______________________________
Name
______________________________
Address
______________________________
Address
______________________________
______________________________
Social Security or other
Taxpayer Identification Number,
if any______________________________
______________________________
Social Security or other
Taxpayer Identification Number,
if any
Name and address (outside the
United States) to where any
check referred to in the first
paragraph of this Conversion
Notice should be mailed:
______________________________
Name
______________________________
Address
______________________________
Social Security or other
Taxpayer Identification Number,
if any
(b) For Registered Securities:
The undersigned Holder of this Security hereby
irrevocably exercises the option to convert this Security, or
any portion of the principal amount hereof (which is an
integral multiple of U.S.$1,000, provided that the unconverted
portion of such principal amount is U.S.$1,000 or any integral
multiple of U.S.$1,000 in excess thereof) below designated,
into shares of Common Stock in accordance with the terms of
the Indenture referred to in this Security, and directs that
such shares, together with a check in payment for any
fractional share and any Securities representing any
unconverted principal amount hereof, be delivered to and be
registered in the name of the undersigned unless a different
name has been indicated below. If shares of Common Stock or
Securities are to be registered in the name of a Person other
than the undersigned, the undersigned will pay all transfer
taxes payable with respect thereto. Any amount required to be
paid by the undersigned on account of interest accompanies
this Security.
Dated: _____________________
____________________
Signature
If shares or Registered
Securities are to be
registered in the name of a
Person other than the
Holder, please print such
Person's name and address:
_________________________
Name
_________________________
Address
_________________________
Social Security or other
Taxpayer Identification
Number, if any
If only a portion of the
Securities is to be
converted, please indicate:
1. Principal amount to be
converted:
U.S.$___________
2. Principal amount and
denomination of
Registered Securities
representing uncon-
verted principal amount
to be issued:
Amount: U.S.$________
Denominations:
U.S.$______
(any integral multiple of
U.S.$1,000, provided that
the unconverted portion of
such principal amount is
U.S.$1,000 or any integral
multiple of U.S.$1,000 in
excess thereof)
___________________________ [Signature Guaranteed]
SECTION 2.6. Legend on Restricted Securities.
During the period beginning on June 5, 1996 and
ending on the date three years from such date (or such shorter
period as the Company may direct in an Officers' Certificate),
any Security originally issued otherwise than in reliance on
Regulation S under the Securities Act, including any Security
issued in exchange therefor or in lieu thereof, shall be a
Registered Security, shall be deemed a "Restricted Security"
and shall be subject to the restrictions on transfer provided
in the legends set forth on the face of the form of Registered
Security in Section 2.2(b); provided, however, that the term
"Restricted Security" shall not include any Registered
Securities as to which restrictions have been terminated in
accordance with Section 3.5. All Restricted Securities shall
bear the applicable legends set forth on the face of the form
of Registered Security in Section 2.2(b). Securities which
are not Restricted Securities shall not bear such legend.
ARTICLE THREE
THE SECURITIES
SECTION 3.1. Title and Terms.
The aggregate principal amount of Securities which
may be authenticated and delivered under this Indenture is
limited to U.S.$150,000,000, except for Securities authenti-
cated and delivered in exchange for, or in lieu of, other
Securities pursuant to Section 3.4, 3.5, 3.6, 8.5, 11.8, 12.2
or 14.2(f).
The Securities shall be known and designated as the
4-1/2% Convertible Subordinated Notes due June 1, 2001" of the
Company. Their Stated Maturity shall be June 1, 2001 and they
shall bear interest on their principal amount from June 5,
1996, payable semi-annually in arrears on June 1 and December
1 in each year, commencing December 1, 1996, at the rate of
4-1/2% per annum until the principal thereof is due and at the
rate of 4-1/2% per annum on any overdue principal and, to the
extent permitted by law, on any overdue interest; provided,
however, that payments shall only be made on Business Days as
provided in Section 1.12.
The principal of, premium, if any, and interest on
the Securities shall be payable as provided in the forms of
Securities and coupon set forth in Sections 2.2 and 2.3 (any
city in which any Paying Agent is located being herein called
a "Place of Payment").
The Securities are entitled to the benefits of a
Registration Rights Agreement as provided by Section 10.12.
The Securities are entitled to the payment of Liquidated
Damages and additional interest as provided by Section 10.12.
The Securities shall be redeemable at the option of
the Company at any time on or after June 1, 1999, in whole or
in part, and at the Company's option or otherwise in the event
of certain developments, including developments with respect
to changes in U.S. withholding taxes or certification
requirements, as provided in Article Eleven and in the forms
of Securities set forth in Section 2.2.
The Securities shall be convertible as provided in
Article Twelve (any city in which any Conversion Agent is
located being herein called a "Place of Conversion").
The Securities shall be subordinated in right of
payment to Senior Indebtedness of the Company as provided in
Article Thirteen.
The Securities shall be subject to repurchase by the
Company at the option of the Holders as provided in Article
Fourteen.
SECTION 3.2. Denominations.
The Definitive Securities shall be issuable (i) in
bearer form, with interest coupons attached, in the denomi-
nation of U.S.$5,000 and (ii) as Registered Securities,
without coupons, in denominations of U.S.$1,000 and integral
multiples of U.S.$1,000 in excess thereof.
SECTION 3.3. 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 Chief Executive Officer, its President, its Chief
Financial Officer or one of its Vice Presidents, attested by
its Secretary or one of its Assistant Secretaries. Any such
signature may be manual or facsimile.
Securities bearing the manual or facsimile signature
of individuals who were at any time the proper officers of the
Company shall bind the Company, notwithstanding that such
individuals or any of them have ceased to hold such offices
prior to the authentication and delivery of such Securities or
did not hold such offices at the date of such Securities.
At any time and from time to time after the
execution and delivery of this Indenture, the Company may
deliver Securities executed by the Company to the Trustee or
to its order for authentication (or to the Paying Agent in
London, England, or to its order, in the case of Bearer
Securities or the Temporary Global Bearer Security), together
with a Company Order for the authentication and delivery of
such Securities, and the Trustee or an Authenticating Agent in
accordance with such Company Order shall authenticate and make
available for delivery such Securities as in this Indenture
provided and not otherwise. In connection with any Company
Order for authentication, an Officers' Certificate and Opinion
of Counsel pursuant to Section 1.2 shall not be required.
Each Bearer Security and the Temporary Global Bearer
Security shall be dated as of June 5, 1996. Each Registered
Security shall be dated the date of its authentication.
No Security (or coupon attached thereto) 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 or an
Authenticating Agent by manual signature of an authorized
signatory, and such certificate upon any Security shall be
conclusive evidence, and the only evidence, that such Security
has been duly authenticated and delivered hereunder. Except
as permitted by Section 3.4 or 3.6, neither the Trustee nor an
Authenticating Agent shall authenticate and make available for
delivery any Bearer Security unless all coupons appurtenant
thereto for interest then matured have been detached and
canceled.
SECTION 3.4. Temporary Global Bearer Security.
(a) The Securities (other than the Registered
Securities) shall be issued initially in the form of one
Temporary Global Bearer Security, which Temporary Global
Bearer Security shall be deposited on behalf of the
subscribers for the Securities represented thereby with
Bankers Trust Company, as common depositary (the "Common
Depositary"), for credit to their respective accounts (or to
such other accounts as they may direct) at MORGAN GUARANTY
TRUST COMPANY OF NEW YORK, BRUSSELS OFFICE, as operator of the
EUROCLEAR SYSTEM ("EUROCLEAR"), or CEDEL BANK, SOCIETE ANONYME
("CEDEL").
On or before the Exchange Date, the Company shall
deliver to the Paying Agent in London, England, at its
principal London office located at 1 Appold Street, Broadgate,
London EC2A 2HE, England, or its designated agent, Bearer
Securities executed by the Company. On or after the Exchange
Date, the Temporary Global Bearer Security shall be
surrendered by the Common Depositary to the Trustee or its
agent, as the Company's agent for such purpose, to be
exchanged, in whole or from time to time in part, for Bearer
Securities without charge to Holders, and the Trustee or the
Paying Agent in London, England, or other Paying Agent outside
the United States shall authenticate and deliver (at an office
or agency outside the United States), in exchange for the
Temporary Global Bearer Security or the portions thereof to be
exchanged, an equal aggregate principal amount of Bearer
Securities, as shall be specified by the beneficial owners
thereof; provided, however, that upon such presentation by the
Common Depositary, the Temporary Global Bearer Security is
accompanied by a certificate dated the Exchange Date or a
subsequent date and signed by EUROCLEAR as to the portion of
the Temporary Global Bearer Security held for its account then
to be exchanged and a certificate dated the Exchange Date or
a subsequent date and signed by CEDEL as to the portion of the
Temporary Global Bearer Security held for its account then to
be exchanged, each to the effect hereinafter provided. The
Company hereby appoints the principal office of the Paying
Agent in London, England, or its designated agent, as its
agent outside the United States where Bearer Securities may be
delivered in exchange for the Temporary Global Bearer Security
or portions thereof. Each beneficial owner of any portion of
the Temporary Global Bearer Security shall be entitled to take
delivery of Bearer Securities only at such office.
Notwithstanding any other provision hereof or of the
Securities, no Security initially represented by the Temporary
Global Bearer Security will be mailed to or otherwise
delivered in connection with its original issuance to any
location within the United States. The Trustee agrees that it
will cause the Paying Agent in London, England, to retain each
certificate provided by EUROCLEAR or CEDEL for a period of
four calendar years following the year in which the
certificate is received and not to destroy or otherwise
dispose of any such certificate without first offering to
deliver it to the Company.
Each certificate to be provided by EUROCLEAR and
CEDEL shall be substantially to the following effect or with
such changes therein as shall be approved by the Company and
Goldman Sachs International and be satisfactory to the
Trustee:
"CERTIFICATE
UNITED WASTE SYSTEMS, INC.
4-1/2% CONVERTIBLE SUBORDINATED NOTES
DUE JUNE 1, 2001
This is to certify that, based on certificates we
have received from our member organizations substantially in
the form set out in Section 3.11 of the Indenture relating to
the above-captioned Securities, as of the date hereof,
U.S.$_____________ principal amount of the above-captioned
Securities acquired from United Waste Systems, Inc. (i) is
owned by persons that are not United States persons (as
defined below), (ii) is owned by United States persons that
are (a) foreign branches of United States financial
institutions (as defined in United States Treasury Regulations
Section 1.165-12(c)(1)(v) ("financial institutions"))
purchasing for their own account or for resale or (b) United
States persons who acquired the Securities through foreign
branches of United States financial institutions and who hold
the Securities through such financial institutions on the date
hereof (and in the case of either clause (a) or (b), each
financial institution has agreed for the benefit of United
Waste Systems, Inc. to comply with the requirements of Section
165(j)(3)(A), (B) or (C) of the United States Internal Revenue
Code of 1986, as amended, and the regulations thereunder) or
(iii) is owned by financial institutions for purposes of
resale during the restricted period (as defined in United
States Treasury Regulations Section 1.163-5(c)(2)(i)(D)(7)).
Financial institutions described in clause (iii) of the
preceding sentence (whether or not also described in clause
(i) or (ii)) have certified that they have not acquired the
Securities for purposes of resale directly or indirectly to
United States persons or to persons within the United States
or its possessions.
As used in this Certificate, "United States person"
is a person that is, for United States federal income tax
purposes, (a) a citizen or resident of the United States,
(b) a corporation, partnership or other entity created or
organized in or under the laws of the United States or any
political subdivision thereof, or (c) an estate or trust the
income of which is subject to United States Federal income
taxation regardless of the source; "United States" means the
United States of America (including the States thereof and the
District of Columbia); and its "possessions" include Puerto
Rico, U.S. Virgin Islands, Guam, American Samoa, Wake Island
and the Northern Mariana Islands.
We further certify that (i) we are not making
available herewith for exchange any portion of the Temporary
Global Bearer Security excepted in such certificates and
(ii) as of the date hereof, we have not received any
notification from any of our member organizations to the
effect that the statements made by such member organizations
with respect to any portion of the part submitted herewith for
exchange are no longer true and cannot be relied upon as of
the date hereof.
We understand that this certificate is required in
connection with certain tax laws of the United States. In
connection therewith, if administrative or legal proceedings
are commenced or threatened in connection with which this
certificate is or would be relevant, we irrevocably authorize
you to produce this certificate to any interested party in
such proceedings. We agree to retain each statement provided
by a member organization for a period of four calendar years
following the year in which the statement is received.
Dated: ________, 19__*
*To be dated no
earlier than the
Exchange Date.
[MORGAN GUARANTY TRUST COMPANY OF
NEW YORK, BRUSSELS OFFICE, AS
OPERATOR OF THE EUROCLEAR SYSTEM]
[CEDEL BANK, SOCIETE ANONYME]
By __________________________"
Each certificate received by EUROCLEAR and CEDEL
from Persons appearing in their records as Persons entitled to
a portion of the Temporary Global Bearer Security shall be
substantially to the effect set forth in Section 3.11.
Upon any such exchange of a portion of the Temporary
Global Bearer Security for Bearer Securities, the Temporary
Global Bearer Security shall be endorsed to reflect the
reduction of the principal amount evidenced thereby. Until so
exchanged in full, the Temporary Global Bearer Security shall
in all respects be entitled to the same benefits under, and
subject to the same terms and conditions of, this Indenture as
Bearer Securities authenticated and delivered hereunder,
except that none of EUROCLEAR, CEDEL or the beneficial owners
of the Temporary Global Bearer Security shall be entitled to
receive payment of interest or other payments thereon or to
convert the Temporary Global Bearer Security, or any portion
thereof, into Common Stock of the Company or any other
security, cash or other property.
Bearer Securities shall be exchangeable for
Registered Securities as provided in Section 3.5.
(b) Registered Securities shall be issued in
definitive, fully registered form, without interest coupons,
shall initially be registered in such names and be in such
authorized denominations as Goldman Sachs International shall
designate and shall bear the legends required hereunder. The
Company will make available to the Trustee a reasonable supply
of Registered Securities in definitive form.
Pending the preparation of definitive Registered
Securities, the Company may execute, and upon Company Order
the Trustee shall authenticate and make available for deli-
very, temporary Registered Securities which are printed,
lithographed, typewritten, mimeographed or otherwise produced,
in any authorized denomination, substantially of the tenor of
the definitive Registered 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 Registered Securities are issued, the
Company will cause definitive Registered Securities to be
prepared without unreasonable delay. After the preparation of
definitive Registered Securities, the temporary Registered
Securities shall be exchangeable for definitive Registered
Securities upon surrender of the temporary Registered
Securities at any office or agency of the Company designated
pursuant to Section 10.2, without charge to the Holder. Upon
surrender for cancellation of any one or more temporary
Registered Securities the Company shall execute and the
Trustee shall authenticate and make available for delivery in
exchange therefor a like principal amount of definitive
Registered Securities of authorized denominations. Until so
exchanged the temporary Registered Securities shall in all
respects be entitled to the same benefits under this Indenture
as definitive Registered Securities.
SECTION 3.5. Registration, Registration of Transfer and
Exchange; Restrictions on Transfer.
(a) 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 designated pursuant to Section 10.2 being herein
sometimes collectively referred to as the "Security Register")
in which, subject to such reasonable regulations as it may
prescribe, the Company shall provide for the registration of
Registered Securities and of transfers of Registered
Securities. The Trustee is hereby appointed "Security
Registrar" for the purpose of registering Registered
Securities and transfers and exchanges of Registered
Securities as herein provided.
Upon surrender for registration of transfer of any
Registered Security at an office or agency of the Company
designated pursuant to Section 10.2 for such purpose, the
Company shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or
transferees, one or more new Registered Securities of any
authorized denominations and of a like aggregate principal
amount and bearing such restrictive legends as may be required
by this Indenture (including Section 2.6).
At the option of the Holder, and subject to the
other provisions of this Section 3.5, Registered Securities
may be exchanged for other Registered Securities of any
authorized denomination and of a like aggregate principal
amount, upon surrender of the Registered Securities to be
exchanged at any such office or agency. Whenever any
Registered Securities are so surrendered for exchange, and
subject to the other provisions of this Section 3.5, the
Company shall execute, and the Trustee shall authenticate and
deliver, the Securities which the Holder making the exchange
is entitled to receive. Every Registered Security presented
or surrendered for registration of transfer or for exchange
shall (if so required by the Company or the Security
Registrar) be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to the Company and
the Security Registrar duly executed, by the Holder thereof or
his attorney duly authorized in writing.
Bearer Securities may not be issued in exchange for
Registered Securities.
At the option of the Holder, upon written request,
Bearer Securities may be exchanged at any time after the
Exchange Date for Registered Securities of any authorized
denomination and of a like aggregate principal amount, upon
surrender of the Bearer Securities to be exchanged at any
office or agency outside the United States designated pursuant
to Section 10.2, with all unmatured coupons and all matured
coupons in default thereto appertaining. If the Holder of a
Bearer Security is unable to produce any such unmatured coupon
or coupons or matured coupon or coupons in default, such
exchange may be effected if such Bearer Security is
accompanied by payment in funds acceptable to the Company in
an amount equal to the face amount of such missing coupon or
coupons or the surrender of such missing coupon or coupons may
be waived by the Company, the Trustee, and the Paying Agent in
London, England, if there is furnished to them such security
or indemnity as they may require to save each of them and any
Paying Agent harmless. If thereafter the Holder of such Bearer
Security shall surrender to any Paying Agent outside the
United States any such missing coupon in respect of which such
a payment shall have been made, such Holder shall be entitled
to receive the amount of such payment; provided, however,
that, except as otherwise provided in the form of Bearer
Security set forth in Section 2.2(a), interest represented by
coupons shall be payable only upon presentation and surrender
of such coupons at an office or agency of the Company outside
the United States. Notwithstanding the foregoing, in case a
Bearer Security is surrendered in exchange for a Registered
Security at an office or agency of the Company outside the
United States designated pursuant to Section 10.2 after the
close of business at such office or agency on (i) any Regular
Record Date and before the opening of business at such office
or agency on the next succeeding Interest Payment Date, or
(ii) any Special Record Date and before the opening of
business at such office or agency on the related date for
payment of Defaulted Interest, such Bearer Security shall be
surrendered without the coupon relating to such Interest
Payment Date or proposed date of payment, as the case may be,
and interest or Defaulted Interest, as the case may be, will
not be payable on such Interest Payment Date or such related
date for payment of Defaulted Interest, as the case may be, in
respect of the Registered Security issued in exchange for such
Bearer Security, but will be payable only to the Holder of
such coupon when due in accordance with the provisions of this
Indenture.
Whenever any Bearer Securities are so surrendered
for exchange, subject to the other provisions of this Sec-
tion 3.5, the Company shall execute, and the Trustee shall
authenticate and deliver, the Registered 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
subject to the other provisions of this Section 3.5, entitled
to the same benefits under this Indenture, as the Securities
surrendered upon such registration of transfer or exchange.
No service charge shall be made for any registration
of transfer or exchange of Securities except as provided in
Section 3.6, 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 3.4, 8.5, 11.8, 12.2 or 14.2 (other than, in the case
of the exchange of Registered Securities, where the shares of
Common Stock are to be issued or delivered in a name other
than that of the Holder of the Registered Security) not
involving any transfer and other than any stamp and other
duties, if any, which may be imposed in connection with any
such transfer or exchange by the United States or the United
Kingdom or any political subdivision thereof or therein, which
shall be paid by the Company.
In the event of a redemption of the Securities in
part (other than, in the case of Bearer Securities, a
redemption pursuant to the fourth paragraph on the reverse of
the Form of Bearer Security set forth in Section 2.2(a)), the
Company will not be required (a) to register the transfer or
exchange of Registered Securities or to exchange Bearer
Securities for Registered Securities for a period of 15 days
immediately preceding the date notice is given identifying the
serial numbers of the Securities called for such redemption,
(b) to register the transfer of or exchange any Registered
Security, or portion thereof, called for redemption, or (c) to
exchange any Bearer Security called for redemption; provided,
however, that a Bearer Security called for redemption may be
exchanged for a Registered Security which is simultaneously
surrendered to the Registrar or Transfer Agent making such
exchange with written instructions for conversion consistent
with the provisions described in Sections 2.5 and 12.2.
(b) Every Restricted Security shall be subject to
the restrictions on transfer provided in the legends required
to be set forth on the face of each Restricted Security
pursuant to Section 2.6, unless such restrictions on transfer
shall be waived by the written consent of the Company, or
terminated in accordance with this Section 3.5(b) or Section
3.5(c). The Holder of each Restricted Security, by such
Holder's acceptance thereof, agrees to be bound by such
restrictions on transfer.
The restrictions imposed by this Section 3.5 and
Section 2.6 upon the transferability of any particular
Restricted Security shall cease and terminate upon a sale of
such Restricted Security in a manner contemplated by the Shelf
Registration Statement and upon delivery by the Company to the
Trustee of an Officers' Certificate stating that such
Restricted Security has been transferred in compliance with
Rule 144 under the Securities Act (or any successor provision
thereto). Any Restricted Security as to which the Company has
delivered to the Trustee an Officers' Certificate that such
restrictions on transfer shall have expired in accordance with
their terms or shall have terminated may, upon surrender of
such Restricted Security for exchange to the Security
Registrar or any Transfer Agent in accordance with the
provisions of this Section 3.5 be exchanged for a new
Registered Security, of like tenor and aggregate principal
amount, which shall not bear the restrictive legends required
by Section 2.6. The Company shall inform the Trustee in
writing of the effective date of the Shelf Registration
Statement registering the Securities under the Securities Act
and shall notify the Trustee at any time when Securities may
not be sold pursuant to such Shelf Registration Statement. The
Trustee shall not be liable for any action taken or omitted to
be taken by it in good faith in accordance with the
aforementioned registration statement.
As used in the preceding two paragraphs of this
Section 3.5, the term "transfer" encompasses any sale, pledge,
transfer or other disposition of any Restricted Security.
(c) The restrictions imposed by this Section 3.5 and
Section 2.6 upon transferability of any particular Restricted
Security shall cease and terminate upon the surrender for
registration of transfer, or for exchange where the securities
issuable upon such exchange are to be registered in a name
other than that of the undersigned Holder (each such
transaction being a "transfer"), of such Restricted Security
to the Security Registrar or any Transfer Agent, accompanied
by a certificate with respect to such transfer, dated the date
of such surrender and signed by the Holder of such Restricted
Security, in substantially the form set forth below:
"CERTIFICATE
UNITED WASTE SYSTEMS, INC.
4-1/2% CONVERTIBLE SUBORDINATED NOTES
DUE JUNE 1, 2001
With respect to U.S.$______________ principal amount
of the above-captioned securities surrendered on the date
hereof (the "Surrendered Securities") for registration of
transfer the undersigned Holder certifies that the transfer of
Surrendered Securities associated with such registration of
transfer complied with Rule 904 under the United States
Securities Act of 1933, as amended.
[Name of Holder]
_______________________
Dated: _________________, __*"
* To be dated the date
of presentation or surrender
Any Restricted Security as to which the Holder thereof has
delivered to the Security Registrar or any Transfer Agent a
certificate in such form may, upon such surrender, be
exchanged for a new Registered Security of like tenor and
aggregate principal amount, which shall not bear the legend
required by Section 2.6, and which shall not thereafter be
deemed to be a Restricted Security for purposes of this
Indenture.
In any circumstances where the Trustee would be
authorized by this Section 3.5(c) to authenticate an
unlegended Registered Security upon transfer or exchange of a
Restricted Security, the Trustee shall be authorized to
instruct The Depository Trust Company, in accordance with the
procedures thereof (as in effect from time to time), to reduce
the principal amount of any Security in global form
representing Restricted Securities (a "Restricted Global
Registered Security"), and to increase the principal amount of
any Security in global form representing Registered Securities
which are not Restricted Securities (an "Unrestricted Global
Registered Security"), by the principal amount of the
beneficial interest in such Restricted Global Registered
Security to be so transferred or exchanged, and to credit or
cause to be credited the account of the transferee a
beneficial interest in such Unrestricted Global Registered
Security having a principal amount equal to the amount by
which the principal amount of the Restricted Global Registered
Security was reduced upon such transfer or exchange.
(d) Neither the Trustee, the Paying Agent in
London, England, nor any of their agents shall (1) have any
duty to monitor compliance with or with respect to any federal
or state or other securities or tax laws or (2) have any duty
to obtain documentation on any transfers or exchanges other
than as specifically required hereunder.
SECTION 3.6. Mutilated, Destroyed, Lost or Stolen
Securities and Coupons.
If any mutilated Security or a Security with a
mutilated coupon appertaining to it is surrendered to the
Trustee or to a Transfer Agent outside the United States, the
Company shall execute, the Trustee or an Authenticating Agent
shall authenticate and the Trustee or Transfer Agent shall
deliver in exchange therefor a new Security of like tenor and
principal amount and bearing a number not contemporaneously
outstanding, with coupons corresponding to the coupons, if
any, appertaining to the surrendered Security; provided,
however, that any Bearer Security or any coupon shall be
delivered only outside the United States; and provided,
further, that all Bearer Securities shall be delivered and
received in person.
If there be delivered to the Company and either to
the Trustee or to a Transfer Agent outside the United States:
(1) evidence to their satisfaction of the
destruction, loss or theft of any Security or
coupon, and
(2) such security or indemnity as may be
satisfactory to the Company and the Trustee and
such Transfer Agent to save each of them and any
agent of either of them harmless,
then, in the absence of actual notice to the Company, the
Trustee or the Transfer Agent that such Security or coupon has
been acquired by a bona fide purchaser, the Company shall
execute, the Trustee or an Authenticating Agent shall
authenticate and the Trustee or Transfer Agent shall deliver,
in lieu of any such destroyed, lost or stolen Security or in
exchange for the Security to which such coupon appertains
(together with all appurtenant coupons not destroyed, lost or
stolen), a new Security of like tenor and principal amount and
bearing a number not contemporaneously outstanding, with
coupons corresponding to the coupons, if any, appertaining to
such destroyed, lost or stolen Security or appertaining to the
Security to which such destroyed, lost or stolen coupon
appertains; provided, however, that any Bearer Security or any
coupon shall be delivered only outside the United States; and
provided, further, that all Bearer Securities shall be
delivered and received in person.
In case any such mutilated, destroyed, lost or
stolen Security or coupon has become or is about to become due
and payable, the Company in its discretion, but subject to any
conversion rights, may, instead of issuing a new Security, pay
such Security or coupon, upon satisfaction of the conditions
set forth in the preceding paragraph; provided, however, that,
except as otherwise provided in the form of Securities set
forth in Section 2.2(a), the principal of and interest on
Bearer Securities shall be payable only at an office or agency
outside the United States and, in the case of interest, only
upon presentation and surrender of the coupons appertaining
thereto.
Upon the issuance of any new Security under this
Section 3.6, 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 (other than any stamp and
other duties, if any, which may be imposed in connection
therewith by the United States or the United Kingdom or any
political subdivision thereof or therein, which shall be paid
by the Company) and any other expenses (including the fees and
expenses of the Trustee, the Paying Agent in London, England,
and the Transfer Agent) connected therewith.
Every new Security with its coupons, if any, issued
pursuant to this Section 3.6 in lieu of any mutilated,
destroyed, lost or stolen Security or in exchange for a
Security to which a mutilated, destroyed, lost or stolen
coupon appertains, shall constitute an original additional
contractual obligation of the Company, whether or not the
mutilated, destroyed, lost or stolen Security and its coupons,
if any, or the mutilated, destroyed, lost or stolen coupon
shall be at any time enforceable by anyone, and such new
Security and coupons, if any, shall be entitled to all the
benefits of this Indenture equally and proportionately with
any and all other Securities and coupons duly issued
hereunder.
The provisions of this Section 3.6 are exclusive and
shall preclude (to the extent lawful) all other rights and
remedies of any Holder with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities or
coupons.
SECTION 3.7. Payment of Interest; Interest Rights
Preserved.
Interest on any Registered Security which is
payable, and is punctually paid or duly provided for, on any
Interest Payment Date shall be paid to the Person in whose
name that Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date
for such interest. In case a Bearer Security is surrendered
in exchange for a Registered Security at an office or agency
of the Company designated pursuant to Section 10.2 for the
purpose after the close of business (at such office or agency)
on any Regular Record Date and before the opening of business
(at such office or agency) on the next succeeding Interest
Payment Date, such Bearer Security shall be surrendered
without the coupon relating to such Interest Payment Date and
interest will not be payable on such Interest Payment Date in
respect of the Registered Security issued in exchange for such
Bearer Security, but will be payable only to the Holder of
such coupon when due.
Interest on the Temporary Global Bearer Security
shall be payable only after the issuance of the Bearer
Securities for which it is exchangeable as provided in the
form of Temporary Global Bearer Security set forth in Section
2.2(c).
Any interest on any Registered Security which is
payable, but is not punctually paid or duly provided for, on
any Interest Payment Date (herein called "Defaulted Interest")
shall forthwith cease to be payable to the Holder on the
relevant Regular Record Date by virtue of having been such
Holder, and such Defaulted Interest may be paid by the
Company, at its election in each case, as provided in
Clause (1) or (2) below:
(1) The Company may elect to make payment of any
Defaulted Interest to the Persons in whose names the
Registered Securities (or their respective Predecessor
Securities) are registered at the close of business on a
Special Record Date for the payment of such Defaulted
Interest, which shall be fixed in the following manner.
The Company shall notify the Trustee in writing of the
amount of Defaulted Interest proposed to be paid on each
Registered Security, the date of the proposed payment and
the Special Record Date, 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. The Special Record Date for the payment of
such Defaulted Interest 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, in the name and at the expense of
the Company, shall cause notice of the proposed payment
of such Defaulted Interest and the Special Record Date
therefor to be mailed, first-class postage prepaid, to
each Holder of Registered Securities at such Holder's
address as it appears in the Security Register, not less
than 10 days prior to such Special Record Date. Notice
of the proposed payment of such Defaulted Interest and
the Special Record Date therefor having been so mailed,
such Defaulted Interest shall be paid to the Persons in
whose names the Registered Securities (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). In case a Bearer Security is surrendered in
exchange for a Registered Security at an office or agency
of the Company designated pursuant to Section 10.2 for
such purpose after the close of business (at such office
or agency) on any Special Record Date and before the
opening of business (at such office or agency) on the
related proposed date for payment of Defaulted Interest,
such Bearer Security shall be surrendered outside the
United States without the coupon relating to such
proposed date of payment and Defaulted Interest will not
be payable on such proposed date of payment in respect of
the Registered Security issued in exchange for such
Bearer Security, but will be payable only to the Holder
of such coupon upon surrender thereof at an office or
agency outside the United States designated pursuant to
Section 10.2 hereof.
(2) The Company may make payment of any Defaulted
Interest in any other lawful manner not inconsistent with
the requirements of any securities exchange on which the
Securities may be listed, and upon such notice as may be
required by such exchange, if, after notice given by the
Company to the Trustee of the proposed payment pursuant
to this Clause, such manner of payment shall be deemed
practicable by the Trustee.
Subject to the foregoing provisions of this Section
and Section 3.5, 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.
In the case of any Registered Security which is
converted in accordance with Section 12.2 after any Regular
Record Date and on or prior to the next succeeding Interest
Payment Date, interest whose Stated Maturity is on such
Interest Payment Date shall be payable on such Interest
Payment Date notwithstanding such conversion, and such
interest (whether or not punctually paid or duly provided for)
shall be paid to the Person in whose name such Registered
Security (or one or more Predecessor Securities) is registered
at the close of business on such Regular Record Date. Except
as otherwise expressly provided in the immediately preceding
sentence or in Section 12.2, in the case of any Security which
is converted, interest whose Stated Maturity is after the date
of conversion of such Security shall not be payable.
SECTION 3.8. Persons Deemed Owners.
Title to any Bearer Security (including any
Temporary Global Bearer Security) or coupon shall pass by
delivery. The Company, the Trustee, the Paying Agent in
London, England, and any other agent of the Company or the
Trustee may treat the bearer of any Bearer Security or the
Temporary Global Bearer Security and the bearer of any coupon
as the absolute owner of such Security or coupon, as the case
may be, for the purpose of receiving payment thereof or on
account thereof and for all other purposes whatsoever, whether
or not such Security or coupon be overdue, and neither the
Company, the Trustee, the Paying Agent in London, England, nor
any other agent of the Company or the Trustee shall be
affected by notice to the contrary. Prior to due presentment
of a Registered Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the
Trustee may treat the Person in whose name such Registered
Security is registered as the owner of such Registered Secur-
ity for the purpose of receiving payment of principal of,
premium, if any, and (subject to Section 3.7) 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 3.9. Cancellation.
All Securities and coupons surrendered for payment,
redemption, repurchase, registration of transfer or exchange
or conversion shall, if surrendered to any Person other than
the Trustee, be delivered to the Trustee. All Bearer
Securities and coupons so surrendered shall be immediately
canceled by such Person upon receipt prior to being forwarded
to the Trustee. All Registered Securities so delivered to the
Trustee shall be canceled promptly by the Trustee. No
Securities shall be authenticated in lieu of or in exchange
for any Securities canceled as provided in this Section 3.9.
The Trustee shall destroy all canceled Securities and coupons
in accordance with applicable law and its customary practices
in effect from time to time.
SECTION 3.10. Computation of Interest.
Interest on the Securities (including any Liquidated
Damages or other additional interest) shall be computed on the
basis of a 360-day year of twelve 30-day months.
SECTION 3.11. Form of Certification.
Whenever any provision of this Indenture or the form
of Temporary Global Bearer Security contemplates that certif-
ication be given by a beneficial owner of a portion of the
Temporary Global Bearer Security, such certification shall be
provided substantially in the form of the following certifi-
cate, with only such changes as shall be approved by the
Company and Goldman Sachs International:
CERTIFICATE
UNITED WASTE SYSTEMS, INC.
4-1/2% CONVERTIBLE SUBORDINATED NOTES
DUE JUNE 1, 2001
This is to certify that as of the date hereof and
except as provided in the fourth paragraph hereof, the above-
captioned Securities held by you for our account (i) are owned
by a person that is not a United States person (as defined
below), (ii) are owned by a United States person that is (A)
a foreign branch of a United States financial institution (as
defined in United States Treasury Regulations Section 1.165-
12(c)(1)(v) (a "financial institution")) purchasing for its
own account or for resale or (B) a United States person who
acquired the Securities through a foreign branch of a United
States financial institution and who holds the Securities
through such financial institution on the date hereof (and in
the case of either clause (A) or (B), the financial
institution hereby agrees for the benefit of United Waste
Systems, Inc. to comply with the requirements of Section
165(j)(3)(A), (B) or (C) of the United States Internal Revenue
Code of 1986, as amended, and the regulations thereunder) or
(iii) are owned by a financial institution for purposes of
resale during the restricted period (as defined in United
States Treasury Regulations Section 1.163-5(c)(2)(i)(D)(7)).
In addition, if we are a financial institution described in
clause (iii) of the preceding sentence (whether or not also
described in clause (i) or (ii)) we certify that we have not
acquired the Securities for purposes of resale directly or
indirectly to a United States person or to a person within the
United States or its possessions.
As used in this certificate, "United States person"
is a Person that is, for United States federal income tax
purposes, (a) a citizen or resident of the United States,
(b) a corporation, partnership or other entity created or
organized in or under the laws of the United States or any
political subdivision thereof or (c) an estate or trust the
income of which is subject to United States Federal income
taxation regardless of the source; "United States" means the
United States of America (including the States thereof and the
District of Columbia); and its "possessions" includes Puerto
Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake
Island and the Northern Mariana Islands.
We undertake to advise you by telecopy, on or before
the date on which you intend to submit your certification
relating to the above-captioned Securities then appearing in
your books as being held for our account, if the above
statement as to beneficial ownership is not correct on such
date as to all such Securities.
This certificate excepts and does not relate to
U.S.$________ principal amount of the above-captioned
Securities appearing on your books as being held for our
account as to which we are not yet able to certify and as to
which we understand that exchange and delivery of definitive
Securities cannot be made until we are able so to certify.
We understand that this certificate is required in
connection with certain tax regulations in the United States.
If administrative or legal proceedings are commenced or
threatened in connection with which this certificate is or
would be relevant, we irrevocably authorize you to produce
this certificate or a copy hereof to any interested party in
such proceedings.
Dated: ___________________, 19__*
*To be dated on or after
the 15th day before the
Exchange Date.
[Name of Account Holder]
________________________
(Authorized Signatory)
Name:
Title:
SECTION 3.12. CUSIP Numbers.
The Company in issuing Registered Securities may use
"CUSIP" numbers (if then generally in use) in addition to
serial numbers, and in issuing Bearer Securities may use
"ISIN" numbers (if then generally in use); if so, the Trustee
shall use such "CUSIP" and "ISIN" numbers in addition to
serial numbers in notices of redemption and repurchase as a
convenience to Holders; provided that any such notice may
state that no representation is made as to the correctness of
such CUSIP and ISIN numbers either as printed on the Securi-
ties or as contained in any notice of a redemption or
repurchase and that reliance may be placed only on the serial
or other identification numbers printed on the Securities, and
any such redemption or repurchase shall not be affected by any
defect in or omission of such CUSIP or ISIN numbers.
SECTION 3.13. Notification of Withholding.
The Company shall notify the Trustee in writing of
the necessity, if any, to withhold any amounts from payments
to Holders (and the amount of any such withholding) arising
from the delivery by a Holder of any certificate pursuant to
Section 2.5 or 3.11.
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 4.1. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to
be of further effect (except as to any surviving rights of
conversion, or registration of transfer or exchange, or
replacement of Securities herein expressly provided for and
any right to receive Additional Amounts, Bearer Additional
Amounts, Liquidated Damages and any other additional interest
as provided in the forms of Securities set forth in
Section 2.2 and the Company's obligations to the Trustee
pursuant to Section 6.7), and the Trustee, at the expense of
the Company, shall execute proper instruments in form and
substance satisfactory to the Trustee acknowledging
satisfaction and discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated
and delivered and all coupons appertaining thereto
(other than (i) Securities and coupons which have
been destroyed, lost or stolen and which have been
replaced or paid as provided in Section 3.6,
(ii) coupons appertaining to Securities called for
redemption or repurchased and maturing after the
relevant Redemption Date or Repurchase Date, as the
case may be, whose surrender has been waived as
provided in Section 11.7 and (iii) Securities and
coupons 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 10.3) have been delivered to the Trustee
for cancellation; or
(B) all such Securities and all coupons
appertaining thereto not theretofore delivered to
the Trustee or the Paying Agent in London, England,
or its agent for cancellation (other than
Securities or coupons referred to in clauses (i)
through (iii) of clause (1)(A) above)
(i) have become due and payable, or
(ii) will have 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 by the Trustee in the
name, and at the expense, of the Company,
and the Company, in the case of clause (i), (ii) or
(iii) above, has deposited or caused to be
deposited with the Trustee as trust funds
(immediately available to the Holders in the case
of clause (i)) in trust for the purpose an amount
sufficient to pay and discharge the entire
indebtedness on such Securities and coupons not
theretofore delivered to the Trustee for cancella-
tion, for principal, premium, if any, and interest
(including any applicable Additional Amounts,
Bearer Additional Amounts, Liquidated Damages and
any other additional 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 6.7, the obligations of the Company to any
Authenticating Agent under Section 6.12, the obligation of the
Company to pay Additional Amounts and Bearer Additional
Amounts and, if money shall have been deposited with the
Trustee pursuant to clause (1)(B) of this Section 4.1, the
obligations of the Trustee under Section 4.2 and the last
paragraph of Section 10.3 shall survive.
SECTION 4.2. Application of Trust Money.
Subject to the provisions of the last paragraph of
Section 10.3, all money deposited with the Trustee pursuant to
Section 4.1 shall be held in trust and applied by it, in
accordance with the provisions of the Securities, the coupons
and this Indenture, to the payment, either directly or through
any Paying Agent (including the Company acting as its own
Paying Agent), to the Persons entitled thereto, of the
principal, premium, if any, and interest for whose payment
such money has been deposited with the Trustee.
All moneys deposited with the Trustee pursuant to
Section 4.1 (and held by it or any Paying Agent) for the
payment of Securities subsequently converted shall be returned
to the Company upon Company Request.
ARTICLE FIVE
REMEDIES
SECTION 5.1. Events of Default.
"Event of Default", wherever used herein, means any
one of the following events (whatever the reason for such
Event of Default and whether it shall be occasioned by the
provisions of Article Thirteen or 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
(including any Additional Amounts, Bearer Additional
Amounts, Liquidated Damages or any other additional
interest) upon any Security 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 at its Maturity; or
(3) 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 the
performance or breach of which is specifically dealt with
elsewhere in this Section), and continuance of such
default or breach for a period of 60 days after there has
been given, by registered or certified mail, to the
Company by the Trustee or to the Company and the Trustee
by the Holders of at least 25% in principal amount of the
Outstanding Securities 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
(4) a default under any bond, debenture, note or
other evidence of indebtedness for money borrowed by the
Company or under any 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 with a principal amount then outstanding
in excess of U.S.$10,000,000, whether such indebtedness
now exists or shall hereafter be created, which default
shall constitute a failure to pay any portion of the
principal of such indebtedness when due and payable after
the expiration of any applicable grace period with
respect thereto or shall have resulted in such
indebtedness becoming or being declared due and payable
prior to the date on which it would otherwise have become
due and payable, without such indebtedness having been
discharged, or such acceleration having been rescinded or
annulled, within a period of 30 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 a written notice specifying such
default and requiring the Company to cause such
indebtedness to be discharged or cause such default to be
cured or waived or such acceleration to be rescinded or
annulled and stating that such notice is a "Notice of
Default" hereunder; or
(5) the entry by a court having jurisdiction in the
premises of (A) a decree or order for relief in respect
of the Company 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 a bankrupt or insolvent, or
approving as properly filed a petition seeking
reorganization, arrangement, adjustment or composition of
or in respect of the Company under any applicable Federal
or State law, or appointing a custodian, receiver,
liquidator, assignee, trustee, sequestrator or other
similar official of the Company or of any substantial
part of its property, or ordering the winding up or
liquidation of its affairs, and the continuance of any
such decree or order for relief or any such other decree
or order unstayed and in effect for a period of 60
consecutive days; or
(6) the commencement by the Company of a voluntary
case or proceeding under any applicable 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 it to the
entry of a decree or order for relief in respect of the
Company 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 it, or the filing by it of a petition
or answer or consent seeking reorganization or similar
relief under any applicable Federal or State law, or the
consent by it 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 of any
substantial part of its property, or the making by it of
an assignment for the benefit of creditors, or the
admission by it in writing of its inability to pay its
debts generally as they become due, or the taking of
corporate action by the Company in furtherance of any
such action.
SECTION 5.2. Acceleration of Maturity; Rescission and
Annulment.
If an Event of Default 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 may
declare the principal of all the Securities to be due and
payable immediately, by a notice in writing to the Company
(and to the Trustee if given by the Holders), and upon any
such declaration such principal and all accrued interest
thereon shall become immediately due and payable.
At any time after such declaration of acceleration
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 Five provided, the Holders of a majority in
principal amount of the Outstanding Securities, by written
notice to the Company and the Trustee, may rescind and annul
such declaration and its consequences if
(1) the Company has paid or deposited with the
Trustee a sum sufficient to pay
(A) all overdue interest on all Securities,
(B) the principal of and premium, if any, on
any Securities which have become due otherwise than
by such declaration of acceleration and any
interest thereon at the rate borne by the
Securities,
(C) to the extent that payment of such
interest is lawful, interest upon overdue interest
at a rate of 4-1/2 % per annum, and
(D) all sums paid or advanced by the Trustee
hereunder and the reasonable compensation,
expenses, disbursements and advances of the
Trustee, its agents and counsel;
and
(2) all Events of Default, other than the non-
payment of the principal of, and any interest on,
Securities which have become due solely by such
declaration of acceleration, have been cured or waived as
provided in Section 5.13.
No rescission or annulment referred to above shall
affect any subsequent default or impair any right consequent
thereon.
SECTION 5.3. Collection of Indebtedness and Suits for
Enforcement by Trustee.
The Company covenants that if
(1) default is made in the payment of any interest
(including any Additional Amounts, Bearer Additional
Amounts, Liquidated Damages or other additional interest)
on any Security when it becomes due and payable and such
default continues for a period of 30 days, or
(2) default is made in the payment of the principal
of or premium, if any, on any Security at the Maturity
thereof,
the Company will, upon demand of the Trustee, pay to it, for
the benefit of the Holders of such Securities and any coupons
appertaining thereto, the whole amount then due and payable on
such Securities and coupons for principal and interest
(including any Additional Amounts, Bearer Additional Amounts,
Liquidated Damages and other additional interest) and interest
on any overdue principal and premium, if any, and on any
overdue interest (including any Additional Amounts, Bearer
Additional Amounts, Liquidated Damages and other additional
interest), at a rate of 4-1/2% per annum, and in addition
thereto, such further amount as shall be sufficient to cover
the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel.
If the Company fails to pay such amounts forthwith
upon such demand, the Trustee, in its own name and as trustee
of an express trust, may institute a judicial proceeding for
the collection of the sums so due and unpaid, may prosecute
such proceeding to judgment or final decree and may enforce
the same against the Company or any other obligor upon the
Securities and collect the moneys adjudged or decreed to be
payable in the manner provided by law out of the property of
the Company or any other obligor upon the Securities, wherever
situated.
If an Event of Default 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 and
coupons by such appropriate judicial proceedings as the
Trustee shall deem most effectual to protect and enforce any
such rights, whether for the specific enforcement of any
covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other
proper remedy.
SECTION 5.4. Trustee May File Proofs of Claim.
In case of the pendency of any receivership,
insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment, composition or other judicial
proceeding relative to the Company or any other obligor upon
the Securities or coupons or the property of the Company or of
such other obligor or the creditors of either, the Trustee
(irrespective of whether the principal of, and any interest
on, the Securities shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of
whether the Trustee shall have made any demand on the Company
for the payment of overdue principal or interest) shall be
entitled and empowered, by intervention in such proceeding or
otherwise,
(1) to file and prove a claim for the whole amount
of principal, premium, if any, and interest owing and
unpaid in respect of the Securities and take such other
actions, including participating as a member, voting or
otherwise, of any official committee of creditors
appointed in such matter, and to file such other papers
or documents, in each of the foregoing cases, as may be
necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel) and of the Holders of
Securities and coupons allowed in such judicial pro-
ceeding, and
(2) to collect and receive any moneys or other
property payable or deliverable on any such claim and to
distribute the same;
and any custodian, receiver, assignee, trustee, liquidator,
sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Holder of Securities
and coupons to make such payments to the Trustee and, in the
event that the Trustee shall consent to the making of such
payments directly to the Holders of Securities and coupons, to
pay to the Trustee any amount due to 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 6.7.
Nothing herein contained shall be deemed to autho-
rize the Trustee to authorize or consent to or accept or adopt
on behalf of any Holder of a Security or coupon any plan of
reorganization, arrangement, adjustment or composition
affecting the Securities or the coupons or the rights of any
Holder thereof or to authorize the Trustee to vote in respect
of the claim of any Holder of a Security or coupon in any such
proceeding; provided, however, that the Trustee may, on behalf
of such Holders, vote for the election of a trustee in
bankruptcy or similar official.
SECTION 5.5. Trustee May Enforce Claims Without Possession
of Securities or Coupons.
All rights of action and claims under this Indenture
or the Securities or coupons may be prosecuted and enforced by
the Trustee without the possession of any of the Securities or
coupons or the production thereof in any proceeding relating
thereto, and any such proceeding instituted by the Trustee
shall be brought in its own name as trustee of an express
trust, and any recovery of judgment shall, after provision for
the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and
counsel, be for the ratable benefit of the Holders of the
Securities and coupons in respect of which judgment has been
recovered.
SECTION 5.6. Application of Money Collected.
Subject to Article Thirteen, any money collected by
the Trustee pursuant to this Article Five 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, premium, if any, or interest, upon presentation of
the Securities or coupons, or both, as the case may be, and
the notation thereon of the payment if only partially paid and
upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the
Trustee under Section 6.7;
SECOND: To the payment of the amounts then due and
unpaid for principal, premium, if any, or interest on the
Securities and coupons in respect of which or for the
benefit of which such money has been collected, ratably,
without preference or priority of any kind, according to
the amounts due and payable on such Securities and
coupons for principal, premium, if any, and interest,
respectively; and
THIRD: Any remaining amounts shall be repaid to the
Company.
SECTION 5.7. Limitation on Suits.
No Holder of any Security or coupon 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;
(2) the Holders of not less than 25% in principal
amount of the Outstanding Securities shall have made
written request to the Trustee to institute proceedings
in respect of such Event of Default in its own name as
Trustee hereunder;
(3) such Holder or Holders have offered to the
Trustee reasonable indemnity against the costs, expenses
and liabilities to be incurred in compliance with such
request;
(4) the Trustee for 60 days after its receipt of
such notice, request and offer of indemnity has failed to
institute any such proceeding; and
(5) no direction inconsistent with such written
request has been given to the Trustee during such 60-day
period by the Holders of a majority in principal amount
of the Outstanding Securities;
it being understood and intended that no one or more of such
Holders shall have any right in any manner whatever by virtue
of, or by availing of, any provision of this Indenture to
affect, disturb or prejudice the rights of any other of such
Holders, or to obtain or seek to obtain priority or preference
over any other of such Holders or to enforce any right under
this Indenture, except in the manner herein provided and for
the equal and ratable benefit of all such Holders.
SECTION 5.8. Unconditional Right of Holders
to Receive Principal, Premium
and Interest and to Convert.
Notwithstanding any other provision in this
Indenture, the Holder of any Security or coupon shall have the
right, which is absolute and unconditional, to receive payment
of the principal of, premium, if any, and (subject to Section
3.7) interest on such Security or payment of such coupon on
the respective Stated Maturities expressed in such Security or
coupon (or, in the case of redemption or repurchase, on the
Redemption Date or Repurchase Date, as the case may be), and
to convert such Security in accordance with Article Twelve,
and to institute suit for the enforcement of any such payment
and right to convert, and such rights shall not be impaired
without the consent of such Holder.
SECTION 5.9. Restoration of Rights and Remedies.
If the Trustee or any Holder of a Security or coupon
has instituted any proceeding to enforce any right or remedy
under this Indenture and such proceeding has been discontinued
or abandoned for any reason, or has been determined adversely
to the Trustee or to such Holder, then and in every such case,
subject to any determination in such proceeding, the Company,
the Trustee and the Holders of Securities and coupons shall be
restored severally and respectively to their former positions
hereunder and thereafter all rights and remedies of the
Trustee and such Holders shall continue as though no such
proceeding had been instituted.
SECTION 5.10. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the
replacement or payment of mutilated, destroyed, lost or stolen
Securities or coupons in the last paragraph of Section 3.6, no
right or remedy herein conferred upon or reserved to the
Trustee or to the Holders of Securities or coupons is intended
to be exclusive of any other right or remedy, and every right
and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy
given hereunder or now or hereafter existing at law or in
equity or otherwise. The assertion or employment of any right
or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate
right or remedy.
SECTION 5.11. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder
of any Security or coupon to exercise any right or remedy
accruing upon any Event of Default shall impair any such right
or remedy or constitute a waiver of any such Event of Default
or any acquiescence therein. Every right and remedy given by
this Article Five or by law to the Trustee or to the Holders
of Securities or coupons may be exercised from time to time,
and as often as may be deemed expedient, by the Trustee or
(subject to the limitations contained in this Indenture) by
the Holders of Securities or coupons, as the case may be.
SECTION 5.12. Control by Holders of Securities.
The Holders of a majority in principal amount of the
Outstanding Securities shall have the right to direct the
time, method and place of conducting any proceeding for any
remedy available to the Trustee or exercising any trust or
power conferred on the Trustee, provided that
(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.
SECTION 5.13. Waiver of Past Defaults.
The Holders, either (a) through the written consent
of not less than a majority in principal amount of the
Outstanding Securities, or (b) by the adoption of a
resolution, at a meeting of Holders of the Outstanding
Securities at which a quorum is present, by the Holders of (i)
66-2/3% in principal amount of the Outstanding Securities
represented at such meeting or (ii) a majority in principal
amount of the Securities at the time Outstanding, may on
behalf of the Holders of all the Securities and coupons waive
any past default hereunder and its consequences, except a
default (1) in the payment of the principal of, premium, if
any, or interest (including any Additional Amounts, Bearer
Additional Amounts, Liquidated Damages or any other additional
interest) on any Security, or (2) in respect of a covenant or
provision hereof which under Article Eight cannot be modified
or amended without the consent of the Holder of each
Outstanding Security 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 5.14. Undertaking for Costs.
All parties to this Indenture agree, and each Holder
of any Security or coupon by his acceptance thereof shall be
deemed to have agreed, that any court may in its discretion
require, in any suit for the enforcement of any right or
remedy under this Indenture, or in any suit against the
Trustee for any action taken, suffered or omitted by it as
Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court
may in its discretion assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in such
suit, having due regard to the merits and good faith of the
claims or defenses made by such party litigant; but the
provisions of this Section 5.14 shall not apply to any suit
instituted by the Company, to any suit instituted by the
Trustee, to any suit instituted by any Holder, or group of
Holders, holding in the aggregate more than 10% in principal
amount of the Outstanding Securities, or to any suit
instituted by any Holder of any Security or coupon for the
enforcement of the payment of the principal of, premium, if
any, or interest on any Security or the payment of any coupon
on or after the respective Stated Maturity or Maturities
expressed in such Security or coupon (or, in the case of
redemption or repurchase, on or after the Redemption Date or
Repurchase Date, as the case may be) or for the enforcement of
the right to convert any Security in accordance with Article
Twelve.
SECTION 5.15. Waiver of Stay, Usury or Extension Laws.
The Company covenants (to the extent that it may
lawfully do so) that it will not at any time insist upon, or
plead, or in any manner whatsoever claim or take the benefit
or advantage of, any stay, usury or extension law wherever
enacted, now or at any time hereafter in force, which may
affect the covenants or the performance of this Indenture; and
the Company (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law and
covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will
suffer and permit the execution of every such power as though
no such law had been enacted. The Company acknowledges and
agrees that the Liquidated Damages and the other additional
interest contemplated by Section 10.12 are a reasonable
estimate of the economic harm that would be suffered by
Holders of Registered Securities as a result of the Company's
failure to comply with its obligations as set forth in
Section 10.12 of the Registration Rights Agreement and do not
constitute a penalty. The Company further agrees, to the
extent permitted by law, to waive, and not assert, any claim
that the Liquidated Damages or other additional interest is a
penalty.
ARTICLE SIX
THE TRUSTEE
SECTION 6.1. Certain Duties and Responsibilities.
(a) The duties and responsibilities of the Trustee
shall be as provided by this Indenture and the Trust
Indenture Act.
(b) Except during the continuance of an Event of
Default,
(1) the Trustee undertakes to perform such duties
and only such duties as are specifically set forth in
this Indenture, and no implied covenants or obligations
shall be read into this Indenture against the Trustee;
and
(2) in the absence of bad faith on its part, the
Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this
Indenture; but in the case of any such certificates or
opinions which by any provision hereof are specifically
required to be furnished to the Trustee, the Trustee
shall be under a duty to examine the same to determine
whether or not they conform to the requirements of this
Indenture, but not to verify the contents thereof.
(c) In case an Event of Default has occurred and is
continuing of which a Responsible Officer of the Trustee has
actual knowledge, the Trustee shall exercise such of the
rights and powers vested in it by this Indenture, and use the
same degree of care and skill in their exercise, as a prudent
man would exercise or use under the circumstances in the
conduct of his own affairs.
(d) No provision of this Indenture shall be
construed to relieve the Trustee from liability for its own
negligent action, its own negligent failure to act, or its own
willful misconduct, except that
(1) this paragraph (c) shall not be construed to
limit the effect of paragraph (a) of this Section;
(2) the Trustee shall not be liable for any error
of judgment made in good faith by a Responsible Officer,
unless it shall be proved that the Trustee was negligent
in ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good
faith in accordance with the direction of the Holders of
a majority in principal amount of the Outstanding
Securities relating to the time, method and place of
conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred upon
the Trustee, under this Indenture; and
(4) no provision of this Indenture shall require
the Trustee to expend or risk its own funds or otherwise
incur any financial liability in the performance of any
of its duties hereunder, or in the exercise of any of its
rights or powers, if it shall have reasonable grounds for
believing that repayment of such funds or adequate
indemnity against such risk or liability is not
reasonably assured to it.
(e) 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 6.2. Notice of Defaults.
Within 90 days after the occurrence of any default
hereunder as to which the Trustee has received written notice,
the Trustee shall give to all Holders of Securities, in the
manner provided in Section 1.6, notice of such default, unless
such default shall have been cured or waived; provided,
however, that, except in the case of a default in the payment
of the principal of, premium, if any, or interest on any
Security or coupon, the Trustee shall be protected in
withholding such notice if and so long as the board of
directors, the executive committee or a trust committee of
directors or Responsible Officers of the Trustee in good faith
determine that the withholding of such notice is in the
interest of the Holders; and provided, further, that in the
case of any default of the character specified in
Section 5.1(3), no such notice to Holders of Securities 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.
SECTION 6.3. Certain Rights of Trustee.
Subject to the provisions of Section 6.1:
(1) the Trustee may rely and shall be protected in
acting or refraining from acting upon any resolution,
Officers' Certificate, other certificate, statement,
instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, coupon, 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 of its
selection and the advice of such counsel or any Opinion
of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance
thereon;
(5) the Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this
Indenture at the request or direction of any of the
Holders of Securities or coupons pursuant to this
Indenture, unless such Holders shall have offered to the
Trustee reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred
by it in compliance with such request or direction;
(6) the Trustee shall not be bound to make any
investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond,
debenture, note, coupon, other evidence of indebtedness
or other paper or document, but the Trustee may make such
further inquiry or investigation into such facts or
matters as it may see fit, and, if the Trustee shall
determine to make such further inquiry or investigation,
it shall be entitled to examine the books, records and
premises of the Company, personally or by agent or
attorney;
(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;
(8) the permissive right of the Trustee to take or
refrain from taking any actions enumerated in this
Indenture shall not be construed as a duty and the
Trustee shall not be answerable in such actions other
than for its own negligence or willful misconduct; and
(9) the Trustee shall not be liable for any action
taken, suffered or omitted to be taken by it in good
faith and reasonably believed by it to be authorized or
within the discretion or rights or powers conferred upon
it by the Indenture.
SECTION 6.4. Not Responsible for Recitals or Issuance of
Securities.
The recitals contained herein and in the Securities
(except the Trustee's certificates of authentication) and in
the coupons shall be taken as the statements of the Company,
and the Trustee assumes no responsibility for their correct-
ness. The Trustee makes no representations as to the validity
or sufficiency of this Indenture, of the Securities or
coupons, or of the Common Stock issuable upon the conversion
of the Securities. The Trustee shall not be accountable for
the use or application by the Company of Securities or the
proceeds thereof.
SECTION 6.5. May Hold Securities, Act as Trustee Under Other
Indentures.
The Trustee, any Authenticating Agent, any Paying
Agent, any Conversion Agent or any other agent of the Company
or the Trustee, in its individual or any other capacity, may
become the owner or pledgee of Securities and coupons and may
otherwise deal with the Company with the same rights it would
have if it were not Trustee, Authenticating Agent, Paying
Agent, Conversion Agent or such other agent.
The Trustee may become and act as trustee under
other indentures under which other securities, or certificates
of interest or participation in other securities, of the
Company are outstanding in the same manner as if it were not
Trustee hereunder.
SECTION 6.6. 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 in writing with the Company.
SECTION 6.7. Compensation and Reimbursement.
The Company agrees
(1) to pay to the Trustee from time to time
such compensation as the Company and the Trustee
shall from time to time agree in writing for all
services rendered by it hereunder (which
compensation shall not be limited by any provision
of law in regard to the compensation of a trustee
of an express trust);
(2) except as otherwise expressly provided
herein, to reimburse the Trustee upon its request
for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in
accordance with any provision of this Indenture
(including the reasonable compensation and the
expenses and disbursements of its agents and
counsel), except any such expense, disbursement or
advance as may be attributable to its negligence or
bad faith; and
(3) to indemnify the Trustee (and its
directors, officers, employees and agents) 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 this trust,
including the costs, expenses and reasonable
attorneys' fees of defending itself against any
claim or liability in connection with the exercise
or performance of any of its powers or duties
hereunder.
When the Trustee incurs expenses or renders services
in connection with an Event of Default specified in Section
5.1(5) or Section 5.1(6), the expenses (including the
reasonable charges of its counsel) and the compensation for
such services are intended to constitute expenses of
administration under any applicable Federal or state
bankruptcy, insolvency or other similar law.
The provisions of this Section shall survive the
termination of this Indenture or the earlier resignation or
removal of the Trustee, any Paying Agent or any Authenticating
Agent, as the case may be.
SECTION 6.8. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder
which shall be a corporation organized and doing business
under the laws of the United States of America, any State
thereof, or the District of Columbia, authorized under such
laws to exercise corporate trust powers, having a combined
capital and surplus of at least U.S.$50,000,000, subject to
supervision or examination by federal or state authority, in
good standing and having an established place of business in
the Borough of Manhattan, The City of New York, and the City
of London, England. If such corporation publishes reports of
condition at least annually, pursuant to law or to the
requirements of said supervising or examining authority, then
for the purposes of this Section, the combined capital and
surplus of such corporation shall be deemed to be its combined
capital and surplus as set forth in its most recent report of
condition so published. If at any time the Trustee shall
cease to be eligible in accordance with the provisions of this
Section, it shall resign immediately in the manner and with
the effect hereinafter specified in this Article and a
successor shall be appointed pursuant to Section 6.9.
SECTION 6.9. Resignation and Removal; Appointment of
Successor.
(a) No resignation or removal of the Trustee and no
appointment of a successor Trustee pursuant to this Article
shall become effective until the acceptance of appointment by
the successor Trustee in accordance with the applicable
requirements of Section 6.10.
(b) The Trustee may resign at any time by giving
written notice thereof to the Company. If the instrument of
acceptance by a successor Trustee required by Section 6.10
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.
(c) The Trustee may be removed at any time by Act
of the Holders of a majority in principal amount of the
Outstanding Securities, delivered to the Trustee and the
Company. If the instrument of acceptance by a successor
Trustee required by Section 6.10 shall not have been delivered
to the Trustee within 30 days after the giving of such notice
of removal, the removed Trustee may petition any court of
competent jurisdiction for the appointment of a successor
Trustee.
(d) If at any time:
(1) the Trustee shall cease to be eligible under
Section 6.8 and shall fail to resign after written
request therefor by the Company or by any Holder of a
Security who has been a bona fide Holder of a Security
for at least six months, or
(2) the Trustee shall become incapable of acting or
shall be adjudged a bankrupt or insolvent or a receiver
of the Trustee or of its property shall be appointed or
any public officer shall take charge or control of the
Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case (i) the Company by a Board Resolution
may remove the Trustee, or (ii) subject to Section 5.14, any
Holder of a Security who has been a bona fide Holder of a
Security for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.
(e) If the Trustee shall resign, be removed or
become incapable of acting, or if a vacancy shall occur in the
office of Trustee for any cause, the Company, by a Board
Resolution, shall promptly appoint a successor Trustee and
shall comply with the applicable requirements of this Section
and Section 6.10. If, within one year after such resignation,
removal or incapability, or the occurrence of such vacancy, a
successor Trustee shall be appointed by Act of the Holders of
a majority in principal amount of the Outstanding Securities
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 6.10, become the successor
Trustee and supersede the successor Trustee appointed by the
Company. If no successor Trustee shall have been so appointed
by the Company or the Holders of Securities and accepted
appointment in the manner required by this Section and
Section 6.10, any Holder of a Security who has been a bona
fide Holder of a Security for at least six months may, on
behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the appointment of a
successor Trustee.
(f) The Company shall give notice of each
resignation and each removal of the Trustee and each
appointment of a successor Trustee to all Holders of
Securities in the manner provided in Section 1.6. Each notice
shall include the name of the successor Trustee and the
address of its Corporate Trust Office.
SECTION 6.10. Acceptance of Appointment by Successor.
Every successor Trustee appointed hereunder 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. 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.
No successor Trustee shall accept its appointment
unless at the time of such acceptance such successor Trustee
shall be eligible under this Article.
SECTION 6.11. 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 of the
corporate trust business of the Trustee, shall be the
successor of the Trustee hereunder, provided such corporation
shall be otherwise 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 6.12. Authenticating Agents.
The Paying Agent in London, England, may
authenticate the Temporary Global Bearer Security and Bearer
Securities. The Trustee may, with the written consent of the
Company, appoint an additional Authenticating Agent or Agents
acceptable to the Company with respect to the Securities which
shall be authorized to act on behalf of the Trustee to
authenticate Securities issued upon exchange or substitution
pursuant to this Indenture.
Securities authenticated by an Authenticating Agent
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, and every reference in this
Indenture to the authentication and delivery of Securities by
the Trustee or the Trustee's certificate of authentication
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 subject to acceptance by 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, the
District of Columbia or England and Wales, authorized under
such laws to act as Authenticating Agent and subject to
supervision or examination by government or other fiscal
authority. If at any time an Authenticating Agent shall cease
to be eligible in accordance with the provisions of this
Section 6.12, such Authenticating Agent shall resign
immediately in the manner and with the effect specified in
this Section 6.12.
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 6.12, without the execution or filing of
any paper or any further act on the part of the Trustee or the
Authenticating Agent.
An Authenticating Agent may resign at any time by
giving written notice thereof to the Trustee and to the
Company. The Trustee may at any time terminate the agency of
an Authenticating Agent by giving written notice thereof to
such Authenticating Agent and to the Company. Upon receiving
such a notice of resignation or upon such a termination, or in
case at any time such Authenticating Agent shall cease to be
eligible in accordance with the provisions of this
Section 6.12, the Trustee may appoint a successor Authenticat-
ing Agent which shall be subject to acceptance by the Company.
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 6.12.
The Company agrees to pay to each Authenticating
Agent from time to time reasonable compensation for its
services under this Section 6.12.
If an Authenticating Agent is appointed with respect
to the Securities pursuant to this Section 6.12, the
Securities may have endorsed thereon, in addition to or in
lieu of the Trustee's certification of authentication, an
alternative certificate of authentication in the following
form:
This is one of the Securities referred to in the
within-mentioned Indenture.
Dated: Bankers Trust Company,
as Trustee
By [Authenticating Agent],
as Authenticating Agent
By ___________________________
Authorized Signatory
ARTICLE SEVEN
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 7.1. 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 all its
properties and assets substantially as an entirety to any
Person, and the Company shall not permit any Person to
consolidate with or merge into the Company or convey, transfer
or lease all or substantially all of its properties and assets
to the Company, unless:
(1) in case the Company shall consolidate with or
merge into another Person or convey, transfer or lease
its properties and assets substantially as an entirety to
any Person, the Person formed by such consolidation or
into which the Company is merged or the Person which
acquires by conveyance or transfer, or which leases the
properties and assets of the Company substantially as an
entirety, shall be a corporation, partnership or trust,
shall be organized and validly existing under the laws of
the United States of America, any State thereof or the
District of Columbia and shall expressly assume, by an
indenture supplemental hereto, executed and delivered to
the Trustee, in form satisfactory to the Trustee, the due
and punctual payment of the principal of, premium, if
any, and interest (including Additional Amounts and
Bearer Additional Amounts, if any, payable pursuant to
Section 10.4 and Liquidated Damages, if any, payable
pursuant to Section 10.12) on all of the Securities and
coupons, as applicable, and the performance or observance
of every covenant of this Indenture on the part of the
Company to be performed or observed and shall have
provided for conversion rights in accordance with Section
12.11;
(2) immediately after giving effect to such
transaction, no Event of Default, and no event which,
after notice or lapse of time or both, would become an
Event of Default, shall have happened and be continuing;
and
(3) the Company has delivered (except in the case
of the merger of any Person into the Company where the
Common Stock is not converted into or exchanged for the
right to receive cash, property or securities, or the
conveyance, transfer or lease by any Person of its
properties and assets substantially as an entirety to the
Company) 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, together with any documents required under
Section 8.3.
SECTION 7.2. 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 all or substantially all the
properties and assets of the Company in accordance with
Section 7.1, 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, the Securities and the coupons, if any.
ARTICLE EIGHT
SUPPLEMENTAL INDENTURES
SECTION 8.1. Supplemental Indentures Without
Consent of Holders of
Securities or Coupons.
Without the consent of any Holders of Securities or
coupons, the Company, when authorized by a Board Resolution,
and the Trustee, at any time and from time to time, may enter
into one or more indentures supplemental hereto 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 and obligations of the Company herein and
in the Securities and coupons as permitted by this
Indenture; or
(2) to add to the covenants of the Company for the
benefit of the Holders of Securities or coupons, or to
surrender any right or power herein conferred upon the
Company; or
(3) to secure the Securities; or
(4) to permit Registered Securities to be exchanged
for Bearer Securities or to remove or relax the
restrictions on payment of principal, premium, if any, or
interest in respect of Bearer Securities in the United
States to the extent then permitted under the Code and
applicable regulations of the United States Treasury
Department; provided, however, that no adverse
consequences would result to any Holder; or
(5) to make provision with respect to the
conversion rights of Holders of Securities pursuant to
Section 12.11; or
(6) to cure any ambiguity, to correct or supplement
any provision herein which may be inconsistent with any
other provision herein or which is otherwise defective,
or to make any other provisions with respect to matters
or questions arising under this Indenture as the Company
and the Trustee may deem necessary or desirable,
provided, such action pursuant to this clause (6) shall
not adversely affect the interests of the Holders of
Securities or coupons; or
(7) in connection with the registration of
Registered Securities pursuant to the Registration Rights
Agreement described in Section 10.12, to make any changes
required to comply with the Trust Indenture Act, or any
successor thereto, and the rules, regulations and forms
promulgated thereunder, all as the same shall be amended
from time to time.
Upon Company Request, accompanied by a Board
Resolution authorizing the execution of any such supplemental
indenture, and subject to and upon receipt by the Trustee of
the documents described in Section 8.3 hereof, the Trustee
shall join with the Company in the execution of any supple-
mental indenture authorized or permitted by the terms of this
Indenture and to make any further appropriate agreements and
stipulations which may be therein contained.
SECTION 8.2. Supplemental Indentures with
Consent of Holders of
Securities.
With either (a) the written consent of the Holders
of not less than a majority in principal amount of the
Outstanding Securities, by the Act of said Holders delivered
to the Company and the Trustee, or (b) by the adoption of a
resolution, at a meeting of Holders of the Outstanding
Securities at which a quorum is present, by the Holders of (i)
66-2/3% in principal amount of the Outstanding Securities
represented at such meeting or (ii) a majority in principal
amount of Securities at the time Outstanding, 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 or coupons under this Indenture; provided, however,
that no such supplemental indenture shall, without the consent
or affirmative vote of the Holder of each Outstanding Security
or coupon affected thereby,
(1) change the Stated Maturity of the principal of,
or any installment of interest on, any Security or coupon
appertaining thereto, or reduce the principal amount or
the rate of interest payable thereon or any premium
payable upon redemption or repurchase thereof, or change
the obligation of the Company to pay Additional Amounts
and any Bearer Additional Amounts pursuant to Section
10.4, or change the coin or currency in which any
Security or the interest or any premium thereon or any
other amount in respect thereof is payable, or impair the
right to institute suit for the enforcement of any
payment in respect of any Security or coupon on or after
the Stated Maturity thereof (or, in the case of
redemption or any repurchase, on or after the Redemption
Date or Repurchase Date, as the case may be) or, except
as permitted by Section 12.11, adversely affect the right
to convert any Security as provided in Article Twelve, or
modify the provisions of this Indenture with respect to
the subordination of the Securities in a manner adverse
to the Holders of Securities or coupons, or
(2) reduce the requirements of Section 9.4 for
quorum or voting, or reduce the percentage in principal
amount of the Outstanding Securities 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 the obligation of the Company to
maintain an office or agency in the Borough of Manhattan,
The City of New York, and in a city in a Western European
country pursuant to Section 10.2, or
(4) modify any of the provisions of this Section or
Section 5.13 or 10.13, except to increase any percentage
contained herein or therein 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; or
(5) modify the provisions of Article Fourteen in a
manner adverse to the Holders; or
(6) modify any of the provisions of Section 10.10,
10.11 or 10.12.
It shall not be necessary for any Act of Holders of
Securities under this Section to approve the particular form
of any proposed supplemental indenture, but it shall be
sufficient if such Act shall approve the substance thereof.
SECTION 8.3. 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 Sections 6.1 and 6.3) 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, and that such supplemental indenture has been
duly authorized, executed and delivered by the Company and
constitutes a valid and legally binding obligation of the
Company enforceable against the Company in accordance with its
terms (subject to customary exceptions). 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 8.4. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture
under this Article, this Indenture shall be modified in
accordance therewith, and such supplemental indenture shall
form a part of this Indenture for all purposes; and every
Holder of Securities theretofore or thereafter authenticated
and delivered hereunder and of any coupons appertaining
thereto shall be bound thereby.
SECTION 8.5. Reference in Securities to Supplemental
Indentures.
Securities 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 so modified as to conform,
in the opinion of the Company and the Trustee, 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.
SECTION 8.6. Notice of Supplemental Indentures.
Promptly after the execution by the Company and the
Trustee of any supplemental indenture pursuant to the
provisions of Section 8.2, the Company shall give notice to
all Holders of Securities of such fact, setting forth in
general terms the substance of such supplemental indenture, in
the manner provided in Section 1.6. Any failure of the
Company to give such notice, or any defect therein, shall not
in any way impair or affect the validity of any such
supplemental indenture.
ARTICLE NINE
MEETINGS OF HOLDERS OF SECURITIES
SECTION 9.1. Purposes for Which Meetings May Be Called.
A meeting of Holders of Securities may be called at
any time and from time to time pursuant to this Article to
make, give or take any request, demand, authorization,
direction, notice, consent, waiver or other action provided by
this Indenture to be made, given or taken by Holders of
Securities.
SECTION 9.2. Call, Notice and Place of Meetings.
(a) The Trustee may at any time call a meeting of
Holders of Securities for any purpose specified in
Section 9.1, to be held at such time and at such place in the
Borough of Manhattan, The City of New York, or in the City of
London, England, as the Trustee shall determine. Notice of
every meeting of Holders of Securities, setting forth the time
and the place of such meeting and in general terms the action
proposed to be taken at such meeting, shall be given, in the
manner provided in Section 1.6, not less than 21 nor more than
180 days prior to the date fixed for the meeting.
(b) In case at any time the Company, pursuant to a
Board Resolution, or the Holders of at least 10% in principal
amount of the Outstanding Securities shall have requested the
Trustee to call a meeting of the Holders of Securities for any
purpose specified in Section 9.1, by written request setting
forth in reasonable detail the action proposed to be taken at
the meeting, and the Trustee shall not have made the first
publication of the notice of such meeting within 21 days after
receipt of such request or shall not thereafter proceed to
cause the meeting to be held as provided herein, then the
Company or the Holders of Securities in the amount specified,
as the case may be, may determine the time and the place in
the Borough of Manhattan, The City of New York, or in the City
of London, England, for such meeting and may call such meeting
for such purposes by giving notice thereof as provided in
paragraph (a) of this Section.
SECTION 9.3. Persons Entitled to Vote at Meetings.
To be entitled to vote at any meeting of Holders of
Securities, a Person shall be (a) a Holder of one or more
Outstanding Securities, or (b) a Person appointed by an
instrument in writing as proxy for a Holder or Holders of one
or more Outstanding Securities by such Holder or Holders. The
only Persons who shall be entitled to be present or to speak
at any meeting of Holders shall be the Persons entitled to
vote at such meeting and their counsel, any representatives of
the Trustee and its counsel and any representatives of the
Company and its counsel.
SECTION 9.4. Quorum; Action.
The Persons entitled to vote a majority in principal
amount of the Outstanding Securities shall constitute a
quorum. In the absence of a quorum within 30 minutes of the
time appointed for any such meeting, the meeting shall, if
convened at the request of Holders of Securities, be
dissolved. In any other case, the meeting may be adjourned
for a period of not less than 10 days as determined by the
chairman of the meeting prior to the adjournment of such
meeting. In the absence of a quorum at any such adjourned
meeting, such adjourned meeting may be further adjourned for
a period not less than 10 days as determined by the chairman
of the meeting prior to the adjournment of such adjourned
meeting (subject to repeated applications of this sentence).
Notice of the reconvening of any adjourned meeting shall be
given as provided in Section 9.2(a), except that such notice
need be given only once not less than five days prior to the
date on which the meeting is scheduled to be reconvened.
Notice of the reconvening of an adjourned meeting shall state
expressly the percentage of the principal amount of the
Outstanding Securities which shall constitute a quorum.
Subject to the foregoing, at the reconvening of any
meeting adjourned for a lack of a quorum, the Persons entitled
to vote 25% in principal amount of the Outstanding Securities
at the time shall constitute a quorum for the taking of any
action set forth in the notice of the original meeting.
At a meeting or an adjourned meeting duly reconvened
and at which a quorum is present as aforesaid, any resolution
and all matters (except as limited by the proviso to
Section 8.2) shall be effectively passed and decided if passed
or decided by the Persons entitled to vote not less than
66-2/3% in principal amount of Outstanding Securities
represented and entitled to vote at such meeting.
Any resolution passed or decisions taken at any
meeting of Holders of Securities duly held in accordance with
this Section shall be binding on all the Holders of Securities
and coupons, whether or not present or represented at the
meeting. The Trustee shall, in the name and at the expense of
the Company, notify all the Holders of Securities of any such
resolutions or decisions pursuant to Section 1.6.
SECTION 9.5. Determination of Voting Rights;
Conduct and Adjournment of
Meetings.
(a) Notwithstanding any other provisions of this
Indenture, the Trustee may make such reasonable regulations as
it may deem advisable for any meeting of Holders of Securities
in regard to proof of the holding of Securities and of the
appointment of proxies and in regard to the appointment and
duties of inspectors of votes, the submission and examination
of proxies, certificates and other evidence of the right to
vote, and such other matters concerning the conduct of the
meeting as it shall deem appropriate. Except as otherwise
permitted or required by any such regulations, the holding of
Securities shall be proved in the manner specified in
Section 1.4 and the appointment of any proxy shall be proved
in the manner specified in Section 1.4 or by having the
signature of the Person executing the proxy witnessed or
certified by any officer authorized by Section 1.4(c) to
certify to the holding of Bearer Securities.
(b) The Trustee shall, by an instrument in writing,
appoint a temporary chairman (which may be the Trustee) of the
meeting, unless the meeting shall have been called by the
Company or by Holders of Securities as provided in
Section 9.2(b), in which case the Company or the Holders of
Securities calling the meeting, as the case may be, shall in
like manner appoint a temporary chairman. A permanent
chairman and a permanent secretary of the meeting shall be
elected by vote of the Persons entitled to vote a majority in
principal amount of the Outstanding Securities represented at
the meeting.
(c) At any meeting, each Holder of a Security or
proxy shall be entitled to one vote for each U.S.$1,000
principal amount of Securities held or represented by him;
provided, however, that no vote shall be cast or counted at
any meeting in respect of any Security challenged as not
Outstanding and ruled by the chairman of the meeting to be not
Outstanding. The chairman of the meeting shall have no right
to vote, except as a Holder of a Security or proxy.
(d) Any meeting of Holders of Securities duly
called pursuant to Section 9.2 at which a quorum is present
may be adjourned from time to time by Persons entitled to vote
a majority in principal amount of the Outstanding Securities
represented at the meeting, and the meeting may be held as so
adjourned without further notice.
SECTION 9.6. Counting Votes and Recording Action of
Meetings.
The vote upon any resolution submitted to any
meeting of Holders of Securities shall be by written ballots
on which shall be subscribed the signatures of the Holders of
Securities or of their representatives by proxy and the
principal amounts at Stated Maturity and serial numbers of the
Outstanding Securities held or represented by them. The
permanent chairman of the meeting shall appoint two inspectors
of votes who shall count all votes cast at the meeting for or
against any resolution and who shall make and file with the
secretary of the meeting their verified written reports in
duplicate of all votes cast at the meeting. A record, at
least in duplicate, of the proceedings of each meeting of
Holders of Securities shall be prepared by the secretary of
the meeting and there shall be attached to said record the
original reports of the inspectors of votes on any vote by
ballot taken thereat and affidavits by one or more Persons
having knowledge of the facts setting forth a copy of the
notice of the meeting and showing that said notice was given
as provided in Section 9.2 and, if applicable, Section 9.4.
Each copy shall be signed and verified by the affidavits of
the permanent chairman and secretary of the meeting and one
such copy shall be delivered to the Company and another to the
Trustee to be preserved by the Trustee, the latter to have
attached thereto the ballots voted at the meeting. Any record
so signed and verified shall be conclusive evidence of the
matters therein stated.
ARTICLE TEN
COVENANTS
SECTION 10.1. Payment of Principal, Premium and Interest.
The Company covenants and agrees that it will duly
and punctually pay the principal of and premium, if any, and
interest on the Securities in accordance with the terms of the
Securities, the coupons appertaining thereto and this
Indenture. The interest due on the Bearer Securities on or
before Maturity, other than Additional Amounts and Bearer
Additional Amounts payable as provided in Section 10.4 in
respect of principal of such a Security, shall be payable only
upon presentation and surrender of the several coupons for
such interest installments as are evidenced thereby as they
severally mature. The Company will deposit or cause to be
deposited with the Trustee, one Business Day prior to the
Stated Maturity of any Security or one Business Day prior to
the due date for any installment of interest, all payments so
due, which payments shall be in immediately available funds on
the date of such Stated Maturity or due date, as the case may
be.
SECTION 10.2. Maintenance of Offices or Agencies.
The Company hereby appoints (a) the Corporate Trust
Office of the Trustee as its agent in the Borough of
Manhattan, The City of New York, where Registered Securities
may be presented or surrendered for payment, where Bearer
Securities and coupons may be presented or surrendered for
payment in the circumstances described below (and not
otherwise), where Registered Securities may be surrendered for
registration of transfer or exchange, where Registered
Securities may be surrendered for conversion, where Bearer
Securities may be surrendered for conversion in the
circumstances described below (and not otherwise) and where
notices and demands to or upon the Company in respect of the
Securities and coupons and this Indenture may be served, and
(b) the office of Bankers Trust Company, 1 Appold Street,
Broadgate, London EC2A 2HE, England, as its agent outside of
the United States where, subject to any applicable laws or
regulations, Bearer Securities and coupons may be presented
and surrendered for payment, where, subject to any applicable
laws and regulations, Registered Securities may be surrendered
for payment, where Registered Securities may be surrendered
for registration of transfer or exchange, where Bearer
Securities may be presented for exchange, where Securities may
be surrendered for conversion, and where the written
statements to be delivered by Holders of Registered Securities
as contemplated by third paragraph on the reverse of the form
of Registered Security may be delivered. Payment of principal
of, premium, if any, or interest on Bearer Securities,
including any Additional Amounts and any Bearer Additional
Amounts payable on Bearer Securities pursuant to Section 10.4,
may be made at the Corporate Trust Office of the Trustee in
the Borough of Manhattan, The City of New York, if (but only
if) payment of the full amount of such principal, interest,
Additional Amounts or Bearer Additional Amounts at all offices
outside the United States maintained for such purpose by the
Company in accordance with this Indenture is illegal or
effectively precluded by exchange controls or other similar
restrictions on the full payment or receipt of such amounts in
United States Dollars, as determined by the Company.
The Company may at any time and from time to time
vary or terminate the appointment of any such agent or appoint
any additional agents for any or all of such purposes;
provided, however, that until all of the Securities have been
delivered to the Trustee for cancellation, or moneys
sufficient to pay the principal of, premium, if any, and
interest on the Securities have been made available for
payment and either paid or returned to the Company pursuant to
the provisions of Section 10.3, the Company will maintain
(1) in the Borough of Manhattan, The City of New York, an
office or agency where Registered Securities may be presented
or surrendered for payment and conversion, where Bearer
Securities and coupons may be presented or surrendered for
payment and conversion in the circumstances described in the
last sentence of the first paragraph of this Section (and not
otherwise), where Registered Securities may be surrendered for
registration of transfer or exchange and where notices and
demands to or upon the Company in respect of the Securities
and coupons and this Indenture may be served, and (2) subject
to any laws or regulations applicable thereto, in any city in
a Western European country, an office or agency where
Securities and coupons may be presented and surrendered for
payment, where Securities may be presented for registration of
transfer or exchange or conversion and where the written
statements to be delivered by Holders of Registered Securities
as contemplated by the third paragraph on the reverse of the
form of Registered Security may be delivered. The Company
will give prompt written notice to the Trustee, and notice to
the Holders in accordance with Section 1.6, of the appointment
or termination of any such agents and of the location and any
change in the location of any such office or agency.
If at any time the Company shall fail to maintain
any such required office or agency, or shall fail to furnish
the Trustee with the address thereof, presentations and
surrenders may be made and notices and demands may be served
on the Corporate Trust Office of the Trustee, except that
Bearer Securities and coupons may be presented and surrendered
for payment and conversion to the Paying Agent in London,
England, at its office in the City of London, England or other
Paying Agent or conversion agent outside the United States,
and the Company hereby appoints the Paying Agent in London,
England, as its agent to receive such respective
presentations, surrenders, notices and demands.
SECTION 10.3. Money for Security Payments to Be Held in
Trust.
If the Company shall act as its own Paying Agent, it
will, on or before each due date of the principal of, premium,
if any, or interest on any of the Securities, segregate and
hold in trust for the benefit of the Persons entitled thereto
a sum sufficient to pay the principal, premium, if any, or
interest so becoming due until such sums shall be paid to such
Persons or otherwise disposed of as herein provided and the
Company will promptly notify the Trustee of its action or
failure so to act.
Whenever the Company shall have one or more Paying
Agents, it will, one Business Day prior to each due date of
the principal of, premium, if any, or interest on any
Securities, deposit with the Trustee a sum sufficient to pay
the principal, premium, if any, or interest so becoming due,
such sum to be held for the benefit of the Persons entitled to
such principal, premium, if any, or interest, and (unless such
Paying Agent is the Trustee) the Company will promptly notify
the Trustee of any failure so to act.
The Company will cause each Paying Agent 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) hold all sums held by it for the payment of the
principal of, premium, if any, or interest on Securities
for the benefit of the Persons entitled thereto until
such sums shall be paid to such Persons or otherwise
disposed of as herein provided;
(2) give the Trustee notice of any default by the
Company (or any other obligor upon the Securities) in the
making of any payment of principal, premium, if any, or
interest; and
(3) at any time during the continuance of any such
default, upon the written request of the Trustee,
forthwith pay to the Trustee all sums so held by such
Paying Agent.
The Company may at any time, for the purpose of
obtaining the satisfaction and discharge of this Indenture or
for any other purpose, pay, or by Company Order direct any
Paying Agent to pay, to the Trustee all sums held in trust by
the Company or such Paying Agent, such sums to be held by the
Trustee upon the same trusts as those upon which such sums
were held by the Company or such Paying Agent; and, upon such
payment by any Paying Agent to the Trustee, such Paying Agent
shall be released from all further liability with respect to
such money.
Any money deposited with the Trustee or any Paying
Agent, or then held by the Company, in trust for the payment
of the principal of, premium, if any, or interest on any
Security and remaining unclaimed for two years after such
principal, premium, if any, or interest has become due and
payable shall be paid to the Company on Company Request, or
(if then held by the Company) shall be discharged from such
trust; and the Holder of such Security or any coupon
appertaining thereto shall thereafter, as an unsecured general
creditor, look only to the Company for payment thereof, and
all liability of the Trustee or such Paying Agent with respect
to such trust money, and all liability of the Company as
trustee thereof, shall thereupon cease; provided, however,
that the Trustee or such Paying Agent, before being required
to make any such repayment, may at the expense of the Company
cause to be published once, in an Authorized Newspaper in each
Place of Payment, notice that such money remains unclaimed and
that, after a date specified therein, which shall not be less
than 30 days from the date of such publication, any unclaimed
balance of such money then remaining will be repaid to the
Company.
SECTION 10.4. Additional Amounts and Bearer Additional
Amounts.
The Company will pay to the Holder of any Bearer
Security or any coupon appertaining thereto Additional Amounts
and Bearer Additional Amounts as provided in the form of
Bearer Security and to a Holder of any Registered Security
Additional Amounts as provided in the form of Registered
Security, in each case set forth in Section 2.2. Whenever in
this Indenture there is mentioned, in any context, the payment
of the principal of, premium, if any, or interest on, or in
respect of, any Security or any coupon, such mention shall be
deemed to include mention of the payment of Additional Amounts
and Bearer Additional Amounts provided for in this Section to
the extent that, in such context, Additional Amounts and
Bearer Additional Amounts are, were or would be payable in
respect thereof pursuant to the provisions of this Section and
express mention of the payment of Additional Amounts and
Bearer Additional Amounts (if applicable) in any provisions
hereof shall not be construed as excluding Additional Amounts
and Bearer Additional Amounts in those provisions hereof where
such express mention is not made.
At least 10 days prior to December 1, 1996, or an
earlier Redemption Date or Repurchase Date (and at least
10 days prior to each date of payment of principal, premium,
if any, or interest after December 1, 1996, or such earlier
Redemption Date or Repurchase Date, if there has been any
change with respect to the matters set forth in the below-
mentioned Officers' Certificate), the Company will furnish the
Trustee and the Company's Paying Agents in London, England,
and in the Borough of Manhattan, The City of New York, if
other than the Trustee, with an Officers' Certificate
instructing the Trustee and such Paying Agents whether such
payment of principal of, premium, if any, or interest on the
Securities shall be made to Holders of Securities or coupons
who are not United States persons without withholding for or
on account of any tax, assessment or other governmental charge
described in the second paragraph of the face of the forms of
Definitive Securities set forth in Section 2.2. If any such
withholding shall be required, then such Officers' Certificate
shall specify by country the amount, if any, required to be
withheld on such payments to such Holders of Securities or
coupons and the Company will pay to the Trustee or the Paying
Agent in London, England, the Additional Amounts required by
this Section to be paid in the event of any such withholding.
The Company covenants to indemnify the Trustee and any Paying
Agent for, and to hold them harmless against, any loss,
liability or expense arising out of or in connection with
actions taken or omitted by any of them in reliance on any
Officers' Certificate furnished pursuant to this Section,
except to the extent such loss, liability or expense is
attributable to the Trustee's negligence or bad faith.
SECTION 10.5. Existence.
Subject to Article Seven, 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 corporate power and authority; 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, taken as a
whole, and that the loss thereof is not disadvantageous in any
material respect to the Holders.
SECTION 10.6. Maintenance of Properties.
The Company will cause all properties used or held
for use in the conduct of its business or the business of any
Subsidiary to be maintained and kept in good condition, repair
and working order and supplied with all necessary equipment
and will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in
the judgment of the Company may be necessary so that the
business carried on in connection therewith may be properly
and advantageously conducted at all times, except, in every
case, as and to the extent that the Company may be prevented
by fire, strikes, lockouts, acts of God, inability to obtain
labor or materials, governmental restrictions, enemy action,
civil commotion or unavoidable casualty or similar causes
beyond the control of the Company; provided, however, that
nothing in this Section shall prevent the Company from
discontinuing the operation or maintenance of any of such
properties if such discontinuance is, in the judgment of the
Company, desirable in the conduct of its business or the
business of any Subsidiary and not disadvantageous in any
material respect to the Holders.
SECTION 10.7. Payment of Taxes and Other Claims.
The Company will pay or discharge, or cause to be
paid or discharged, before the same may become delinquent,
(1) all taxes, assessments and governmental charges levied or
imposed upon the Company or any Subsidiary or upon the income,
profits or property of the Company or any Subsidiary, (2) all
claims for labor, materials and supplies which, if unpaid,
might by law become a lien or charge upon the property of the
Company or any Subsidiary, and (3) all stamps and other
duties, if any, which may be imposed by the United States or
the United Kingdom or any political subdivision thereof or
therein in connection with the issuance, transfer, exchange or
conversion of any Securities or coupons or with respect to
this Indenture; provided, however, that, in the case of
clauses (1) and (2), 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 10.8. Registration and Listing.
Within a reasonable time after the issuance of the
Temporary Global Bearer Security (and, in any event, prior to
the Exchange Date), the Company (i) will effect all
registrations with, and obtain all approvals by, all
governmental authorities that may be necessary under any
United States Federal or state law (including the Securities
Act, the Exchange Act and state securities and Blue Sky laws)
before the shares of Common Stock issuable upon conversion of
Securities may be lawfully issued and delivered, and there-
after publicly traded (if permissible under the Securities
Act), and qualified or listed as contemplated by clause (ii)
(it being understood that the Company shall not be required to
register the Securities under the Securities Act); and
(ii) will qualify the shares of Common Stock required to be
issued and delivered upon conversion of Securities, prior to
such issuance or delivery, for quotation on the Nasdaq
National Market or, if the Common Stock is not then quoted on
the Nasdaq National Market, list the Common Stock on each
national securities exchange on which outstanding Common Stock
is listed or quoted at the time of such delivery.
SECTION 10.9. Statement by Officers as to Default.
The Company shall deliver to the Trustee within
120 days after the end of each fiscal year of the Company an
Officers' Certificate stating whether or not to the best
knowledge of the signers thereof any default exists in the
performance and observance of any of the terms, provisions and
conditions of this Article Ten 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 10.10. Delivery of Certain Information.
At any time when the Company is not subject to
Section 13 or 15(d) of the Exchange Act, upon the request of
a Holder of a Restricted Security or the holder of shares of
Common Stock issued upon conversion thereof, the Company will
promptly furnish or cause to be furnished Rule 144A
Information (as defined below) to such Holder of Restricted
Securities or such holder of shares of Common Stock issued
upon conversion of Restricted Securities, or to a prospective
purchaser of any such security designated by any such Holder
or holder, as the case may be, to the extent required to
permit compliance by such Holder or holder with Rule 144A
under the Securities Act (or any successor provision thereto)
in connection with the resale of any such security; provided,
however, that the Company shall not be required to furnish
such information in connection with any request made on or
after the date which is three years from the later of (i) the
date such a security (or any such predecessor security) was
last acquired from the Company or (ii) the date such a
security (or any such predecessor security) was last acquired
from an "affiliate" of the Company within the meaning of Rule
144 under the Securities Act (or any successor provision
thereto). "Rule 144A Information" shall be such information
as is specified pursuant to Rule 144A(d)(4) under the
Securities Act (or any successor provision thereto).
SECTION 10.11. Resale of Certain Securities; Reporting Issuer.
During the period beginning on June 5, 1996 and
ending on the date that is three years from such date, the
Company will not, and will not permit any of its "affiliates"
(as defined under Rule 144 under the Securities Act or any
successor provision thereto) to, resell (x) any Securities
which constitute "restricted securities" under Rule 144 or
(y) any securities into which the Securities have been
converted under this Indenture which constitute "restricted
securities" under Rule 144, that in either case have been
reacquired by any of them. The Trustee shall have no
responsibility in respect of the Company's performance of its
agreement in the preceding sentence. The Company will
continue to be a "reporting issuer" for purposes of Rule 903
under the Securities Act until the full principal amount of
the Temporary Global Bearer Security has been exchanged for
Bearer Securities in accordance with this Indenture.
SECTION 10.12. Registration Rights.
The Holders of Registered Securities and the Common
Stock issuable upon conversion thereof are entitled to the
benefits of a Registration Rights Agreement, dated as of June
5, 1996 (the "Registration Rights Agreement"), between the
Company and Goldman, Sachs & Co. and other Purchasers as such
term is defined therein. Pursuant to the Registration Rights
Agreement, the Company has agreed for the benefit of the
Holders from time to time of Registered Securities and the
Common Stock issuable upon conversion thereof that it will
(i) within 90 days after the date of original issuance of the
Registered Securities, file a shelf registration statement
(the "Shelf Registration Statement") with the Commission with
respect to resales of the Registered Securities and the Common
Stock issuable upon conversion thereof and (ii) use its
reasonable best efforts to cause such Shelf Registration
Statement to be declared effective by the Commission within 90
days after the date on which the Shelf Registration Statement
is filed.
If (i) on or prior to 90 days following the date of
original issuance of the Registered Securities, a Shelf
Registration Statement has not been filed with the Commission,
or (ii) on or prior to the 90th day following the filing of
such Shelf Registration Statement, such Shelf Registration
Statement is not declared effective (each, a "Registration
Default"), additional interest ("Liquidated Damages") will
accrue on the Registered Securities from and including the day
following such Registration Default to but excluding the day
on which such Registration Default has been cured. Liquidated
Damages will be paid semi-annually in arrears, commencing with
the first Interest Payment Date immediately succeeding the
date of such Registration Default, at a rate per annum equal
to one-quarter of one percent (0.25%) of the principal amount
of the Registered Securities, to and including the 90th day
following such Registration Default and at a rate per annum
equal to one-half of one percent (0.50%) thereof from and
after the 91st day following such Registration Default. In the
event that, during the period that the Company is required to
maintain the effectiveness of the Shelf Registration Statement
pursuant to the Registration Rights Agreement, the Shelf
Registration Statement ceases to be effective (or the Holders
are otherwise restricted or prevented by the Company from
making sales pursuant to the Shelf Registration Statement) for
a period in excess of 60 days, whether or not consecutive,
during any 12-month period (an "Effectiveness Failure"), then
additional interest shall accrue on the Registered Securities
from and including the 61st day of the applicable 12-month
period such Shelf Registration Statement ceases to be
effective (or the Holders are otherwise restricted or
prevented from making sales pursuant thereto) to but excluding
the day on which the Effectiveness Failure is cured, at a rate
per annum equal to an additional one-half of one percent
(0.50%) of the principal amount of the Registered Securities,
such additional interest to be payable on the same basis as if
it were Liquidated Damages. For the purpose of determining
whether an Effectiveness Failure has occurred, any day on
which the Company has been obligated to pay additional
interest in accordance with the immediately preceding sentence
in respect of a prior Effectiveness Failure shall not be
included within the applicable 60 days.
Whenever in this Indenture there is mentioned, in
any context, the payment of the principal of, premium, if any,
or interest on, or in respect of, any Registered Security,
such mention shall be deemed to include mention of the payment
of Liquidated Damages and the other additional interest
provided for in this Section to the extent that, in such
context, Liquidated Damages or such other additional interest
is, was or would be payable in respect thereof pursuant to the
provisions of this Section and express mention of the payment
of Liquidated Damages or such other additional interest in any
provisions hereof shall not be construed as excluding
Liquidated Damages or such additional interest in those
provisions hereof where such express mention is not made.
SECTION 10.13. Waiver of Certain Covenants.
The Company may omit in any particular instance to
comply with any covenant or conditions set forth in
Sections 10.5 to 10.7, inclusive (other than a covenant or
condition which under Article Eight cannot be modified or
amended without the consent of the Holder of each Outstanding
Security affected), if before the time for such compliance the
Holders shall, through the written consent of, or the adoption
of a resolution at a meeting of Holders of the Outstanding
Securities at which a quorum is present by, not less than a
majority in principal amount of the Outstanding Securities,
either waive such compliance in such instance or generally
waive compliance with such covenant or condition, but no such
waiver shall extend to or affect such covenant or condition
except to the extent so expressly waived, and, until such
waiver shall become effective, the obligations of the Company
and the duties of the Trustee or any Paying or Conversion
Agent in respect of any such covenant or condition shall
remain in full force and effect.
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 11.1. Right of Redemption.
The Securities may be redeemed in accordance with
the provisions of the forms of Securities set forth in Sec-
tion 2.2.
SECTION 11.2. Applicability of Article.
Redemption of Securities at the election of the
Company or otherwise, as permitted or required by any
provision of the Securities or this Indenture (other than a
redemption upon a Redemption Change in Control), shall be made
in accordance with such provision and this Article Eleven.
SECTION 11.3. 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 any of the
Securities, the Company shall, at least 60 days (or 75 days in
the case of a redemption pursuant to the fourth paragraph of
the reverse of the form of Bearer Security set forth in
Section 2.2(a)) prior to the Redemption Date fixed by the
Company (unless a shorter notice shall be satisfactory to the
Trustee), notify the Trustee in writing of such Redemption
Date. If the Securities are to be redeemed pursuant to an
election of the Company which is subject to a condition
specified in the forms of Securities set forth in Section 2.2,
the Company shall furnish the Trustee with an Officers'
Certificate stating that the Company is entitled to effect
such redemption and setting forth a statement of facts showing
that the conditions precedent to the right of the Company so
to redeem have occurred.
SECTION 11.4. Selection by Trustee of Securities to Be
Redeemed.
If less than all the Securities are to be redeemed
(other than pursuant to the third or fourth paragraph on the
reverse of the form of Bearer Security in Section 2.2(a) or
the third paragraph on the reverse of the form of Registered
Security in Section 2.2(b)), the particular Securities to be
redeemed shall be selected by the Trustee within two Business
Days after it receives the notice described in 11.3, from the
Outstanding Securities not previously called for redemption,
individually by lot in the case of Bearer Securities, and by
such method as the Trustee may deem substantially equivalent
thereto in the case of Registered Securities and under
circumstances intended not to discriminate between Registered
and Bearer Securities to be redeemed pursuant to the terms
thereof and hereof in the selection of Securities (or portion
thereof) selected for redemption. Partial redemption must be
in an amount not less than U.S.$1,000,000 principal amount of
Securities.
If any Registered Security selected for partial
redemption is converted in part before termination of the
conversion right with respect to the portion of the Security
so selected, the converted portion of such Security shall be
deemed (so far as may be) to be the portion selected for
redemption. Securities which have been converted during a
selection of Securities to be redeemed may be treated by the
Trustee as Outstanding for the purpose of such selection.
The Trustee shall promptly notify the Company and
each Security Registrar in writing of the securities selected
for redemption and, in the case of any Registered 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 11.5. Notice of Redemption.
Notice of redemption shall be given in the manner
provided in Section 1.6 to the Holders of Securities to be
redeemed not less than 30 nor more than 60 days prior to the
Redemption Date, and (except, in the case of a redemption
pursuant to the fourth paragraph of the form of reverse of the
Bearer Security set forth in Section 2.2(a), to the extent
otherwise expressly provided in such form) such notice shall
be irrevocable.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all Outstanding Securities are to
be redeemed, the aggregate principal amount of Securities
to be redeemed and the aggregate principal amount of
Securities which will be outstanding after such partial
redemption,
(4) that on the Redemption Date the Redemption
Price, and accrued interest, if any, will become due and
payable upon each such Security to be redeemed, and that
interest thereon shall cease to accrue on and after said
date,
(5) the Conversion Price, the date on which the
right to convert the Securities to be redeemed will
terminate and the places where such Securities, together
with all unmatured coupons appertaining thereto, may be
surrendered for conversion,
(6) the place or places where such Securities,
together with all coupons appertaining thereto, if any,
maturing after the Redemption Date, are to be surrendered
for payment of the Redemption Price and accrued interest,
if any, and
(7) in the case of a notice of redemption pursuant
to the third paragraph on the reverse of the form of
Registered Security, a form of written certification of
each beneficial owner of a Registered Security as to such
beneficial owner's entitlement to Additional Amounts.
In case of a partial redemption, the first notice
given shall specify the last date on which exchanges or
transfers of Securities may be made pursuant to Section 3.5
and the second notice shall specify the serial number and ISIN
number (if any) of the Bearer Securities (either individually
or in group, from one number to another, or by last digit or
digits) called for redemption and, in the case of Registered
Securities, the serial and CUSIP numbers (if any) and the
portions thereof called for redemption.
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 written request, by the Trustee in the name
of and at the expense of the Company. Notice of redemption of
Securities to be redeemed at the election of the Company
received by the Trustee shall be given by the Trustee to each
Paying Agent in the name of and at the expense of the Company.
SECTION 11.6. Deposit of Redemption Price.
Not less than one Business Day prior to any
Redemption Date, the Company shall deposit with the Trustee or
with the Paying Agent in London, England if so directed by the
Trustee (or, if the Company is acting as its own Paying Agent,
segregate and hold in trust as provided in Section 10.3) an
amount of money (which shall be in immediately available funds
on such Redemption Date) 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 other than any
Securities called for redemption on that date which have been
converted prior to the date of such deposit.
If any Security called for redemption is converted,
any money deposited with the Trustee or with a Paying Agent or
so segregated and held in trust for the redemption of such
Security shall (subject to any right of the Holder of such
Security, if a Registered Security, or any Predecessor
Security to receive interest as provided in the last paragraph
of Section 3.7) be paid to the Company on Company Request or,
if then held by the Company, shall be discharged from such
trust.
SECTION 11.7. 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,
including accrued interest) such Securities shall cease to
bear interest and the coupons for such interest appertaining
to Bearer Securities shall, except to the extent provided
below, be void. Upon surrender of any Security for redemption
in accordance with said notice, together with all coupons, if
any, appertaining thereto maturing after the Redemption Date,
such Security shall be paid by the Company at the Redemption
Price together with accrued and unpaid interest to the
Redemption Date; provided, however, that installments of
interest on Bearer Securities whose Stated Maturity is on or
prior to the Redemption Date shall be payable only upon
presentation and surrender of coupons for such interest (at an
office or agency outside the United States, except as other-
wise provided in the form of Bearer Security set forth in
Section 2.2(a)); and provided, further, that installments of
interest on Registered Securities whose Stated Maturity is on
or prior to the Redemption Date shall be payable to the
Holders of such Securities, or one or more Predecessor
Securities, registered as such on the relevant Record Date
according to their terms and the provisions of Section 3.7.
If any Security called for redemption shall not be
so paid upon surrender thereof for redemption, the principal
amount of, premium, if any, and, to the extent permitted by
applicable law, accrued interest on such Security shall, until
paid, bear interest from the Redemption Date at a rate of 4-1/2%
per annum and such Security shall remain convertible until the
principal of such Security (or portion thereof, as the case
may be) shall have been paid or duly provided for.
If any Bearer Security surrendered for redemption
shall not be accompanied by all appurtenant coupons maturing
after the Redemption Date, such Security may be paid after
deducting from the Redemption Price an amount equal to the
face amount of all such missing coupons or the surrender of
such missing coupons or coupon may be waived by the Company
and the Trustee or the Paying Agent in London, England, or its
agent, if there be furnished to them such security or
indemnity as they may require to save each of them and any
Paying Agent harmless. If thereafter the Holder of such
Security shall surrender to any Paying Agent any such missing
coupon in respect of which a deduction shall have been made
from the Redemption Price, such Holder shall be entitled to
receive the amount so deducted; provided, however, that
interest represented by coupons shall be payable only upon
presentation and surrender of those coupons at an office or
agency located outside of the United States (except as
otherwise provided in the form of Bearer Security set forth in
Section 2.2(a)).
SECTION 11.8. Registered Securities Redeemed in Part.
Any Registered Security which is to be redeemed only
in part shall be surrendered at an office or agency of the
Company designated for that purpose pursuant to Section 10.2
(with, if the Company or the Trustee so requires, due endorse-
ment by, or a written instrument of transfer in form satis-
factory 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 authen-
ticate and make available for delivery to the Holder of such
Registered Security without service charge, a new Registered
Security or Securities, 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 Registered Security so surrendered.
ARTICLE TWELVE
CONVERSION OF SECURITIES
SECTION 12.1. Conversion Privilege and Conversion Price.
Subject to and upon compliance with the provisions
of this Article, at the option of the Holder thereof, any
Security other than the Temporary Global Bearer Security may
be converted into fully paid and nonassessable shares
(calculated as to each conversion to the nearest 1/100th of a
share) of Common Stock of the Company at the Conversion Price,
determined as hereinafter provided, in effect at the time of
conversion. Such conversion right shall commence on September
3, 1996 and expire at the close of business on June 1, 2001.
In case a Security or portion thereof is called for redemption
or is delivered for repurchase, such conversion right in
respect of the Security or portion so called shall expire at
the close of business on the fifth Trading Day preceding the
Redemption Date or the second Trading Day preceding the
Repurchase Date, as the case may be, unless the Company
defaults in making the payment due upon redemption or
repurchase, as the case may be.
The price at which shares of Common Stock shall be
delivered upon conversion (herein called the "Conversion
Price") shall be initially U.S.$65.00 per share of Common
Stock. The Conversion Price shall be adjusted in certain
instances as provided in this Article Twelve.
SECTION 12.2. Exercise of Conversion Privilege.
In order to exercise the conversion privilege, the
Holder of any Definitive Security to be converted shall
surrender such Security, duly endorsed or assigned to the
Company or in blank (in the case of any Registered Security),
at any office or agency of the Company maintained for that
purpose pursuant to Section 10.2, accompanied by a duly signed
conversion notice substantially in the form set forth in
Section 2.5 stating that the Holder elects to convert such
Security or, if less than the entire principal amount thereof
is to be converted (in the case of any Registered Security),
the portion thereof to be converted. Each Bearer Security
surrendered for conversion must be surrendered together with
all coupons appertaining thereto that mature after the date of
conversion. If any Bearer Security surrendered for conversion
shall not be accompanied by all such appurtenant coupons, the
surrender of any or all of such missing coupons may be waived
by the Company and the Trustee, if there be furnished to them
such security or indemnity as they may require to save each of
them and any Paying Agent harmless. Matured coupons not in
default (including coupons maturing on the date of conversion)
will be payable against surrender thereof, and matured coupons
previously surrendered and in default will continue to be
payable, notwithstanding the exercise of the right of conver-
sion by the Holder of the Security to which the coupon apper-
tains. Each Registered Security surrendered for conversion
(in whole or in part) during the period from the close of
business on any Regular Record Date to the opening of business
on the next succeeding Interest Payment Date shall be
accompanied by payment in New York Clearing House funds or
other funds acceptable to the Company of an amount equal to
the interest payable on such Interest Payment Date on the
principal amount of such Registered Security (or part thereof,
as the case may be) being surrendered for conversion (or, if
such Registered Security was issued in exchange for a Bearer
Security after the close of business on such Regular Record
Date, by surrender of one or more coupons relating to such
Interest Payment Date or by both payment in such funds and
surrender of such coupon or coupons, in either case in an
amount equal to the interest payable on such Interest Payment
Date on the principal amount of such Registered Security (or
portion thereof) then being converted), except that if any
Registered Security or portion thereof has been called for
redemption on a Redemption Date or is to be repurchased on a
Repurchase Date between a Regular Record Date and the
corresponding Interest Payment Date and, pursuant to Section
12.1, as a result of such redemption or repurchase the right
to convert such Registered Security called for redemption
terminates during such period, then the Holder of such
Registered Security who (or whose transferee) converts such
Registered Security or a portion thereof will be entitled to
receive the amount of interest so payable and shall not be
required to repay such interest upon surrender of such
Registered Security for conversion. The interest so payable
on such Interest Payment Date in respect of such Registered
Security (or portion thereof, as the case may be) surrendered
for conversion shall be paid to the Holder of such Security as
of such Regular Record Date. Interest payable in respect of
any Registered Security surrendered for conversion on or after
an Interest Payment Date shall be paid to the Holder of such
Security as of the next preceding Regular Record Date,
notwithstanding the exercise of the right of conversion.
Except as provided in this paragraph and subject to the last
paragraph of Section 3.7, no cash payment or adjustment shall
be made upon any conversion on account of, if the date of
conversion is not an Interest Payment Date, any interest
accrued from the Interest Payment Date next preceding the
conversion date, in respect of any Definitive Security (or
part thereof, as the case may be) surrendered for conversion,
or on account of any dividends on the Common Stock issued upon
conversion. The Company's delivery to the Holder of the
number of shares of Common Stock (and cash in lieu of
fractions thereof, as provided in this Indenture) into which
a Definitive Security is convertible will be deemed to satisfy
the Company's obligation to pay the principal amount of the
Security.
Definitive Securities shall be deemed to have been
converted immediately prior to the close of business on the
day of surrender of such Securities for conversion in
accordance with the foregoing provisions, and at such time the
rights of the Holders of such Securities as Holders shall
cease, and the Person or Persons entitled to receive the
Common Stock issuable upon conversion shall be treated for all
purposes as the record holder or holders of such Common Stock
at such time. As promptly as practicable on or after the
conversion date, the Company shall issue and deliver to the
Trustee, for delivery to the Holder, a certificate or
certificates for the number of full shares of Common Stock
issuable upon conversion, together with payment in lieu of any
fraction of a share, as provided in Section 12.3.
All shares of Common Stock delivered upon such
conversion of Restricted Securities shall bear restrictive
legends substantially in the form of the legends required to
be set forth on the Restricted Securities pursuant to Section
2.6 and shall be subject to the restrictions on transfer
provided in such legends. Neither the Trustee nor any agent
maintained for the purpose of such conversion shall have any
responsibility for the inclusion or content of any such
restrictive legends on such Common Stock; provided, however,
that the Trustee or any agent maintained for the purpose of
such conversion shall have provided, to the Company or to the
Company's transfer agent for such Common Stock, prior to or
concurrently with a request to the Company to deliver such
Common Stock, written notice that the Securities delivered for
conversion are Restricted Securities.
In the case of any Registered Security which is
converted in part only, upon such conversion the Company shall
execute and the Trustee shall authenticate and deliver to the
Holder thereof, at the expense of the Company, a new
Registered Security or Securities of authorized denominations
in an aggregate principal amount equal to the unconverted
portion of the principal amount of such Security. A
Registered Security may be converted in part, but only if the
principal amount of such Security to be converted is any
integral multiple of U.S.$1,000 and the principal amount of
such security to remain Outstanding after such conversion is
equal to U.S.$1,000 or any integral multiple of $1,000 in
excess thereof.
SECTION 12.3. Fractions of Shares.
No fractional shares of Common Stock shall be issued
upon conversion of any Definitive Security or Securities. If
more than one Definitive Security shall be surrendered for
conversion at one time by the same Holder, the number of full
shares which shall be issuable upon conversion thereof shall
be computed on the basis of the aggregate principal amount of
the Definitive Securities (or specified portions thereof) so
surrendered. Instead of any fractional share of Common Stock
which would otherwise be issuable upon conversion of any
Definitive Security or Securities (or specified portions
thereof), the Company shall calculate and pay a cash adjust-
ment in respect of such fraction (calculated to the nearest
1/100th of a share) in an amount equal to the same fraction of
the Closing Price Per Share at the close of business on the
day of conversion. Such cash payments shall, in the case of
a conversion of Bearer Securities, be made to an address
outside of the United States as requested in writing by such
Holder.
SECTION 12.4. Adjustment of Conversion Price.
The Conversion Price shall be subject to adjustments
by the Company from time to time as follows:
(1) In case the Company shall pay or make a
dividend or other distribution on any class of capital stock
of the Company payable in Common Stock, the Conversion Price
in effect at the opening of business on the day following the
date fixed for the determination of stockholders entitled to
receive such dividend or other distribution shall be reduced
by multiplying such Conversion Price by a fraction of which
the numerator shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for
such determination and the denominator shall be the sum of
such number of shares and the total number of shares
constituting such dividend or other distribution, such
reduction to become effective immediately after the opening of
business on the day following the date fixed for such
determination. For the purposes of this paragraph (1), the
number of shares of Common Stock at any time outstanding shall
not include shares held in the treasury of the Company but
shall include shares issuable in respect of scrip certificates
issued in lieu of fractions of shares of Common Stock. The
Company will not pay any dividend or make any distribution on
shares of Common Stock held in the treasury of the Company.
(2) In case the Company shall issue rights, options
or warrants to all holders of its Common Stock entitling them
to subscribe for or purchase shares of Common Stock at a price
per share less than the current market price per share
(determined as provided in paragraph (8) of this Section) of
the Common Stock on the date fixed for the determination of
stockholders entitled to receive such rights, options or
warrants, the Conversion Price in effect at the opening of
business on the day following the date fixed for such
determination shall be reduced by multiplying such Conversion
Price by a fraction of which the numerator shall be the number
of shares of Common Stock outstanding at the close of business
on the date fixed for such determination plus the number of
shares of Common Stock which the aggregate of the offering
price of the total number of shares of Common Stock so offered
for subscription or purchase would purchase at such current
market price and the denominator shall be the number of shares
of Common Stock outstanding at the close of business on the
date fixed for such determination plus the number of shares of
Common Stock so offered for subscription or purchase, such
reduction to become effective immediately after the opening of
business on the day following the date fixed for such
determination. For the purposes of this paragraph (2), the
number of shares of Common Stock at any time outstanding shall
not include shares held in the treasury of the Company but
shall include shares issuable in respect of scrip certificates
issued in lieu of fractions of shares of Common Stock. The
Company will not issue any rights, options or warrants in
respect of shares of Common Stock held in the treasury of the
Company.
(3) In case outstanding shares of Common Stock
shall be subdivided into a greater number of shares of Common
Stock, the Conversion Price in effect at the opening of
business on the day following the day upon which such
subdivision becomes effective shall be proportionately
reduced, and, conversely, in case outstanding shares of Common
Stock shall each be combined into a smaller number of shares
of Common Stock, the Conversion Price in effect at the opening
of business on the day following the day upon which such
combination becomes effective shall be proportionately
increased, such reduction or increase, as the case may be, to
become effective immediately after the opening of business on
the day following the day upon which such subdivision or
combination becomes effective.
(4) In case the Company shall, by dividend or
otherwise, distribute to all holders of its Common Stock
evidences of its indebtedness, shares of any class of capital
stock, or other property (including securities, but excluding
(i) any rights, options or warrants referred to in paragraph
(2) of this Section, (ii) any dividend or distribution paid
exclusively in cash, (iii) any dividend or distribution
referred to in paragraph (1) of this Section and (iv) any
merger or consolidation to which Section 12.11 applies), the
Conversion Price shall be adjusted so that the same shall
equal the price determined by multiplying the Conversion Price
in effect immediately prior to the close of business on the
date fixed for the determination of stockholders entitled to
receive such distribution by a fraction of which the numerator
shall be the current market price per share (determined as
provided in paragraph (8) of this Section) of the Common Stock
on the date fixed for such determination less the then fair
market value (as determined by the Board of Directors, whose
determination shall be conclusive and described in a Board
Resolution filed with the Trustee) of the portion of the
assets, shares or evidences of indebtedness so distributed
applicable to one share of Common Stock and the denominator
shall be such current market price per share of the Common
Stock, such adjustment to become effective immediately prior
to the opening of business on the day following the date fixed
for the determination of stockholders entitled to receive such
distribution.
(5) In case the Company shall, by dividend or
otherwise, distribute to all holders of its Common Stock cash
(excluding any cash that is distributed upon a merger or
consolidation to which Section 12.11 applies or as part of a
distribution referred to in paragraph (4) of this Section) in
an aggregate amount that, combined together with (I) the
aggregate amount of any other cash distributions to all
holders of its Common Stock made exclusively in cash within
the 12 months preceding the date of payment of such
distribution and in respect of which no adjustment pursuant to
this paragraph (5) has been made and (II) the aggregate of any
cash plus the fair market value (as determined by the Board of
Directors, whose determination shall be conclusive and
described in a Board Resolution) of consideration payable in
respect of any tender offer by the Company or any of its
subsidiaries for all or any portion of the Common Stock
concluded within the 12 months preceding the date of payment
of such distribution and in respect of which no adjustment
pursuant to paragraph (6) of this Section has been made,
exceeds 12.5% of the product of the current market price per
share of the Common Stock on the date for the determination of
holders of shares of Common Stock entitled to receive such
distribution times the number of shares of Common Stock
outstanding on such date, then, and in each such case,
immediately after the close of business on such date for
determination, the Conversion Price shall be adjusted so that
the same shall equal the price determined by multiplying the
Conversion Price in effect immediately prior to the close of
business on the date fixed for determination of the
stockholders entitled to receive such distribution by a
fraction (i) the numerator of which shall be equal to the
current market price per share (determined as provided in
paragraph (8) of this Section) of the Common Stock on the date
fixed for such determination less an amount equal to the
quotient of (x) the excess of such combined amount over such
12.5% and (y) the number of shares of Common Stock outstanding
on such date for determination and (ii) the denominator of
which shall be equal to the current market price per share
(determined as provided in paragraph (8) of this Section) of
the Common Stock on such date for determination.
(6) In case a tender offer made by the Company or
any Subsidiary for all or any portion of the Common Stock
shall expire and such tender offer (as amended upon the
expiration thereof) shall require the payment to stockholders
(based on the acceptance (up to any maximum specified in the
terms of the tender offer) of Purchased Shares (as defined
below)) of an aggregate consideration having a fair market
value (as determined by the Board of Directors, whose
determination shall be conclusive and described in a Board
Resolution) that combined together with (I) the aggregate of
the cash plus the fair market value (as determined by the
Board of Directors, whose determination shall be conclusive
and described in a Board Resolution), as of the expiration of
such tender offer, of consideration payable in respect of any
other tender offer by the Company or any Subsidiary for all or
any portion of the Common Stock expiring within the 12 months
preceding the expiration of such tender offer and in respect
of which no adjustment pursuant to this paragraph (6) has been
made and (II) the aggregate amount of any cash distributions
to all holders of the Company's Common Stock within 12 months
preceding the expiration of such tender offer and in respect
of which no adjustment pursuant to paragraph (5) of this
Section has been made, exceeds 12.5% of the product of the
current market price per share of the Common Stock (determined
as provided in paragraph (8) of this Section) as of the last
time (the "Expiration Time") tenders could have been made
pursuant to such tender offer (as it may be amended) times the
number of shares of Common Stock outstanding (including any
tendered shares) as of the Expiration Time, then, and in each
such case, immediately prior to the opening of business on the
day after the date of the Expiration Time, the Conversion
Price shall be adjusted so that the same shall equal the price
determined by multiplying the Conversion Price immediately
prior to close of business on the date of the Expiration Time
by a fraction (i) the numerator of which shall be equal to (A)
the product of (I) the current market price per share of the
Common Stock (determined as provided in paragraph (8) of this
Section) on the date of the Expiration Time and (II) the
number of shares of Common Stock outstanding (including any
tendered shares) on the Expiration Time less (B) the combined
amount of consideration specified above, and (ii) the
denominator of which shall be equal to the product of (A) the
current market price per share of the Common Stock (determined
as provided in paragraph (8) of this Section) as of the
Expiration Time and (B) the number of shares of Common Stock
outstanding (including any tendered shares) as of the
Expiration Time less the number of all shares validly tendered
and not withdrawn as of the Expiration Time (the shares deemed
so accepted up to any such maximum, being referred to as the
"Purchased Shares").
(7) The reclassification of Common Stock into
securities including other than Common Stock (other than any
reclassification upon a consolidation or merger to which
Section 12.11 applies) shall be deemed to involve (a) a
distribution of such securities other than Common Stock to all
holders of Common Stock (and the effective date of such
reclassification shall be deemed to be "the date fixed for the
determination of stockholders entitled to receive such
distribution" and "the date fixed for such determination"
within the meaning of paragraph (4) of this Section), and
(b) a subdivision or combination, as the case may be, of the
number of shares of Common Stock outstanding immediately prior
to such reclassification into the number of shares of Common
Stock outstanding immediately thereafter (and the effective
date of such reclassification shall be deemed to be "the day
upon which such subdivision becomes effective" or "the day
upon which such combination becomes effective", as the case
may be, and "the day upon which such subdivision or
combination becomes effective" within the meaning of paragraph
(3) of this Section).
(8) For the purpose of any computation under
paragraphs (2), (4), (5) or (6) of this Section 12.4, the
current market price per share of Common Stock on any date
shall be calculated by the Company and be deemed to be the
average of the daily Closing Prices Per Share for the five
consecutive Trading Days selected by the Company commencing
not more than 10 Trading Days before, and ending not later
than, the earlier of the day in question and the day before
the "ex" date with respect to the issuance or distribution
requiring such computation. For purposes of this paragraph,
the term '"ex" date', when used with respect to any issuance
or distribution, means the first date on which the Common
Stock trades regular way in the applicable securities market
or on the applicable securities exchange without the right to
receive such issuance or distribution.
(9) No adjustment in the Conversion Price shall be
required unless such adjustment (plus any adjustments not
previously made by reason of this paragraph (9)) would require
an increase or decrease of at least one percent in such price;
provided, however, that any adjustments which by reason of
this paragraph (9) are not required to be made shall be
carried forward and taken into account in any subsequent
adjustment. All calculations under this Article shall be made
to the nearest cent or to the nearest one-hundredth of a
share, as the case may be.
(10) The Company may make such reductions in the
Conversion Price, for the remaining term of the Securities or
any shorter term, in addition to those required by paragraphs
(1), (2), (3), (4), (5) and (6) of this Section 12.4, as it
considers to be advisable in order to avoid or diminish any
income tax to any holders of shares of Common Stock resulting
from any dividend or distribution of stock or issuance of
rights or warrants to purchase or subscribe for stock or from
any event treated as such for income tax purposes.
SECTION 12.5. Notice of Adjustments of Conversion Price.
Whenever the Conversion Price is adjusted as herein
provided:
(1) the Company shall compute the adjusted
Conversion Price in accordance with Section 12.4 and
shall prepare a certificate signed by the Treasurer of
the Company setting forth the adjusted Conversion Price
and showing in reasonable detail the facts upon which
such adjustment is based, and such certificate shall
promptly be filed with the Trustee and with each
Conversion Agent; and
(2) a notice stating that the Conversion Price has
been adjusted and setting forth the adjusted Conversion
Price shall forthwith be required, and as soon as
practicable after it is required, such notice shall be
provided by the Company to all Holders in accordance with
Section 1.6.
Neither the Trustee nor any Conversion Agent shall be under
any duty or responsibility with respect to any such
certificate or the information and calculations contained
therein, except to exhibit the same to any Holder of
Securities desiring inspection thereof at its office during
normal business hours.
SECTION 12.6. Notice of Certain Corporate Action.
In case:
(a) the Company shall declare a dividend (or
any other distribution) on its Common Stock payable
(i) otherwise than exclusively in cash or
(ii) exclusively in cash in an amount that would
require any adjustment pursuant to Section 12.4; or
(b) the Company shall authorize the granting
to the holders of its Common Stock of rights,
options or warrants to subscribe for or purchase
any shares of capital stock of any class or of any
other rights; or
(c) of any reclassification of the Common
Stock of the Company (other than a subdivision or
combination of its outstanding shares of Common
Stock), or of any consolidation or merger to which
the Company is a party and for which approval of
any stockholders of the Company is required, or of
the sale or transfer of all or substantially all of
the assets of the Company; or
(d) of the voluntary or involuntary
dissolution, liquidation or winding up of the
Company; or
(e) the Company or any Subsidiary shall
commence a tender offer for all or a portion of the
Company's outstanding shares of Common Stock (or
shall amend any such tender offer);
then the Company shall cause to be filed at each office or
agency maintained for the purpose of conversion of Securities
pursuant to Section 10.2, and shall cause to be provided to
all Holders in accordance with Section 1.6, at least 20 days
(or 10 days in any case specified in clause (a) or (b) above)
prior to the applicable record, expiration or effective date
hereinafter specified, a notice stating (x) the date on which
a record is to be taken for the purpose of such dividend,
distribution, rights, options or warrants, or, if a record is
not to be taken, the date as of which the holders of Common
Stock of record to be entitled to such dividend, distribution,
rights, options or warrants are to be determined, (y) the date
on which the right to make tenders under such tender offer
expires or (z) the date on which such reclassification,
consolidation, merger, conveyance, transfer, sale, lease,
dissolution, liquidation or winding up is expected to become
effective, and the date as of which it is expected that
holders of Common Stock of record shall be entitled to
exchange their shares of Common Stock for securities, cash or
other property deliverable upon such reclassification,
consolidation, merger, conveyance, transfer, sale, lease,
dissolution, liquidation or winding up. If at the time the
Trustee shall not be the conversion agent, a copy of such
notice shall also forthwith be filed by the Company with the
Trustee.
SECTION 12.7. Company to Reserve Common Stock.
The Company shall at all times reserve and keep
available, free from preemptive rights, out of its authorized
but unissued Common Stock, for the purpose of effecting the
conversion of Securities, the full number of shares of Common
Stock then issuable upon the conversion of all Outstanding
Securities.
SECTION 12.8. Taxes on Conversions.
The Company will pay any and all taxes and duties
that may be payable in respect of the issue or delivery of
shares of Common Stock on conversion of Securities pursuant
hereto. The Company shall not, however, be required to pay
any tax or duty which may be payable in respect of any
transfer involved in the issue and delivery of shares of
Common Stock in a name other than that of the Holder of the
Security or Securities to be converted, and no such issue or
delivery shall be made unless and until the Person requesting
such issue has paid to the Company the amount of any such tax
or duty, or has established to the satisfaction of the Company
that such tax or duty has been paid.
SECTION 12.9. Covenant as to Common Stock.
The Company agrees that all shares of Common Stock
which may be delivered upon conversion of Securities, upon
such delivery, will have been duly authorized and validly
issued and will be fully paid and nonassessable and, except as
provided in Section 12.8, the Company will pay all taxes,
liens and charges with respect to the issue thereof.
SECTION 12.10. Cancellation of Converted Securities.
All Securities delivered for conversion shall be
delivered to the Trustee or the Paying Agent in London,
England, or its agent to be canceled by or at the direction of
the Trustee, which shall dispose of the same as provided in
Section 3.9.
SECTION 12.11. Provision in Case of Consolidation, Merger or
Sale of Assets.
In case of any consolidation of the Company with, or
merger of the Company into, any other Person, any merger of
another Person into the Company (other than a merger which
does not result in any reclassification, conversion, exchange
or cancellation of outstanding shares of Common Stock of the
Company) or any sale or conveyance, transfer or lease of all
or substantially all of the assets of the Company, the Person
formed by such consolidation or resulting from such merger or
which acquires such assets, as the case may be, shall execute
and deliver to the Trustee a supplemental indenture providing
that the Holder of each Security then Outstanding shall have
the right thereafter, during the period such Security shall be
convertible as specified in Section 12.1, to convert such
Security only into the kind and amount of securities, cash and
other property receivable upon such consolidation, merger,
sale or transfer by a holder of the number of shares of Common
Stock of the Company into which such Security might have been
converted immediately prior to such consolidation, merger,
sale or transfer, assuming such holder of Common Stock of the
Company (i) is not a Person with which the Company con-
solidated or into which the Company merged or which merged
into the Company or to which such sale or transfer was made,
as the case may be ("Constituent Person"), or an Affiliate of
a Constituent Person and (ii) failed to exercise his rights of
election, if any, as to the kind or amount of securities, cash
and other property receivable upon such consolidation, merger,
sale or transfer (provided that if the kind or amount of
securities, cash and other property receivable upon such
consolidation, merger, sale or transfer is not the same for
each share of Common Stock of the Company held immediately
prior to such consolidation, merger, sale or transfer by
others than a Constituent Person or an Affiliate thereof and
in respect of which such rights of election shall not have
been exercised ("Non-electing Share"), then for the purpose of
this Section 12.11 the kind and amount of securities, cash and
other property receivable upon such consolidation, merger,
sale or transfer by the holders of each Non-electing Share
shall be deemed to be the kind and amount so receivable per
share by a plurality of the Non-electing Shares), and further
assuming, if such consolidation, merger, conveyance, transfer,
sale or lease occurs prior to the later of September 3, 1996
and the receipt of Securities in definitive form (in the case
of Securities initially represented by a Temporary Global
Bearer Security), that the Security was convertible at the
time of such occurrence at the Conversion Price specified in
Section 12.1 as adjusted from the issue date of such Security
to such time as provided in this Article Twelve. Such
supplemental indenture shall provide for adjustments which,
for events subsequent to the effective date of such
supplemental indenture, shall be as nearly equivalent as may
be practicable to the adjustments provided for in this
Article. The above provisions of this Section 12.11 shall
similarly apply to successive consolidations, mergers, sales
or transfers. Notice of the execution of such a supplemental
indenture shall be given by the Company to the Holder of each
Security as provided in Section 1.6 promptly upon such
execution.
ARTICLE THIRTEEN
SUBORDINATION OF SECURITIES
SECTION 13.1. Securities Subordinate to Senior Indebtedness.
The Company covenants and agrees, and each Holder of
a Security, by his acceptance thereof, likewise covenants and
agrees, that, to the extent and in the manner hereinafter set
forth in this Article, the indebtedness represented by the
Securities and the payment of the principal of (and premium,
if any) and interest on each and all of the Securities are
hereby expressly made subordinate and subject in right of
payment to the prior payment in full of all Senior
Indebtedness.
SECTION 13.2. Payment Over of Proceeds Upon Dissolution,
Etc.
In the event of (a) any insolvency or bankruptcy
case or proceeding, or any receivership, liquidation,
reorganization or other similar case or proceeding in connec-
tion therewith, relative to the Company or to its creditors,
as such, or to its assets, or (b) any liquidation, dissolution
or other winding up of the Company, whether voluntary or
involuntary and whether or not involving insolvency or bank-
ruptcy, or (c) any assignment for the benefit of creditors or
any other marshalling of assets and liabilities of the
Company, then and in any such event the holders of Senior
Indebtedness shall be entitled to receive payment in full of
all amounts due or to become due on or in respect of all
Senior Indebtedness in cash before the Holders of the
Securities are entitled to receive any payment on account of
principal of (or premium, if any) or interest on the
Securities or on account of the purchase or other acquisition
of Securities, and to that end the holders of Senior
Indebtedness shall be entitled to receive, for application to
the payment thereof, any payment or distribution of any kind
or character, whether in cash, property or securities, which
may be payable or deliverable in respect of the Securities in
any such case, proceeding, dissolution, liquidation or other
winding up or event.
In the event that, notwithstanding the foregoing
provisions of this Section, the Trustee or the Holder of any
Security shall have received any payment or distribution of
assets of the Company of any kind or character, whether in
cash, property or securities, before all Senior Indebtedness
is paid in full, and if such fact shall, at or prior to the
time of such payment or distribution, have been made known to
the Trustee or, as the case may be, such Holder, then and in
such event such payment or distribution shall be paid over or
delivered forthwith to the trustee in bankruptcy, receiver,
liquidating trustee, custodian, assignee, agent or other
Person making payment or distribution of assets of the Company
for application to the payment of all Senior Indebtedness
remaining unpaid, to the extent necessary to pay all Senior
Indebtedness in full, after giving effect to any concurrent
payment or distribution to or for the holders of Senior
Indebtedness.
For purposes of this Article only, the words "cash,
property or securities' shall not be deemed to include shares
of stock of the Company as reorganized or readjusted, or
securities of the Company or any other corporation provided
for by a plan of reorganization or readjustment which are
subordinated in right of payment to all Senior Indebtedness
which may at the time be outstanding to substantially the same
extent as, or to a greater extent than, the Securities are so
subordinated as provided in this Article. The consolidation
of the Company with, or the merger of the Company into,
another Person or the liquidation or dissolution of the
Company following the conveyance or transfer of its properties
and assets substantially as an entirety to another Person upon
the terms and conditions set forth in Article Seven shall not
be deemed a dissolution, winding up, liquidation,
reorganization, assignment for the benefit of creditors or
marshalling of assets and liabilities of the Company for the
purposes of this Section if the Person formed by such
consolidation or into which the Company is merged or which
acquires by conveyance or transfer such properties and assets
substantially as an entirety, as the case may be, shall, as a
part of such consolidation, merger, conveyance or transfer,
comply with the conditions set forth in Article Seven.
SECTION 13.3. Prior Payment to Senior
Indebtedness Upon Acceleration
of Securities.
In the event that any Securities are declared due
and payable before their Stated Maturity, then and in such
event the holders of Senior Indebtedness outstanding at the
time such Securities so become due and payable shall be
entitled to receive payment in full of all amounts due or to
become due on or in respect of such Senior Indebtedness in
cash before the Holders of the Securities are entitled to
receive any payment by the Company on account of the principal
of (or premium, if any) or interest on the Securities or on
account of the purchase, redemption or other acquisition of
Securities.
In the event that, notwithstanding the foregoing,
the Company shall make any payment to the Trustee or the
Holder of any Security prohibited by the foregoing provisions
of this Section, and if such fact shall, at or prior to the
time of such payment, have been made known to the Trustee or,
as the case may be, such Holder, then and in such event such
payment shall be paid over and delivered forthwith to the
Company, in the case of any payment to the Trustee, or the
Trustee, in the case of any payment to any such Holder.
The provisions of this Section shall not apply to
any payment with respect to which Section 13.2 would be
applicable.
SECTION 13.4. No Payment When Senior Indebtedness in
Default.
(a) In the event and during the continuation of any
default in the payment of principal of (or premium, if any) or
interest on any Senior Indebtedness beyond any applicable
grace period with respect thereto or in the event that any
event of default with respect to any Senior Indebtedness shall
have occurred and be continuing which would permit the holders
of such Senior Indebtedness to declare such Senior
Indebtedness due and payable prior to the date on which it
would otherwise have become due and payable, unless and until
such event of default shall have been cured or waived or shall
have ceased to exist, or (b) in the event any judicial
proceeding shall be pending with respect to any such default
in payment or event of default, then no payment shall be made
by the Company on account of principal of (or premium, if any)
or interest on the Securities or on account of the purchase,
redemption or other acquisition of Securities.
In the event that, notwithstanding the foregoing,
the Company shall make any payment to the Trustee or the
Holder of any Security prohibited by the foregoing provisions
of this Section, and if such fact shall, at or prior to the
time of such payment, have been made known to the Trustee or,
as the case may be, such Holder, then and in such event such
payment shall be paid over and delivered forthwith to the
Company, in the case of the Trustee, or the Trustee, in the
case of such Holder.
The provisions of this Section shall not apply to
any payment with respect to which Section 13.2 would be
applicable.
SECTION 13.5. Payment Permitted If No Default.
Nothing contained in this Article or elsewhere in
this Indenture or in any of the Securities shall prevent
(a) the Company, at any time except during the pendency of any
case, proceeding, dissolution, liquidation or other winding
up, assignment for the benefit of creditors or other
marshalling of assets and liabilities of the Company referred
to in Section 13.2 or under the conditions described in
Section 13.3 or 13.4, from making payments at any time of
principal of (and premium, if any) or interest on the
Securities, or (b) the application by the Trustee of any money
deposited with it hereunder to the payment of or on account of
the principal of (and premium, if any) or interest on the
Securities or the retention of such payment by the Holders,
if, at the time of such application by the Trustee, it did not
have knowledge that such payment would have been prohibited by
the provisions of this Article.
SECTION 13.6. Subrogation to Rights of
Holders of Senior Indebtedness.
Subject to the payment in full of all Senior
Indebtedness, the Holders of the Securities shall be
subrogated to the extent of the payments or distributions made
to the holders of such Senior Indebtedness pursuant to the
provisions of this Article to the rights of the holders of
such Senior Indebtedness to receive payments and distributions
of cash, property and securities applicable to the Senior
Indebtedness until the principal of (and premium, if any) and
interest on the Securities shall be paid in full. For
purposes of such subrogation, no payments or distributions to
the holders of the Senior Indebtedness of any cash, property
or securities to which the Holders of the Securities or the
Trustee would be entitled except for the provisions of this
Article, and no payments over pursuant to the provisions of
this Article to the holders of Senior Indebtedness by Holders
of the Securities or the Trustee, shall, as among the Company,
its creditors other than holders of Senior Indebtedness and
the Holders of the Securities, be deemed to be a payment or
distribution by the Company to or on account of the Senior
Indebtedness.
SECTION 13.7. Provisions Solely to Define Relative Rights.
The provisions of this Article are and are intended
solely for the purpose of defining the relative rights of the
Holders of the Securities on the one hand and the holders of
Senior Indebtedness on the other hand. Nothing contained in
this Article or elsewhere in this Indenture or in the
Securities is intended to or shall (a) impair, as among the
Company, its creditors other than holders of Senior
Indebtedness and the Holders of the Securities, the obligation
of the Company, which is absolute and unconditional, to pay to
the Holders of the Securities the principal of (and premium,
if any) and interest on the Securities as and when the same
shall become due and payable in accordance with their terms;
or (b) affect the relative rights against the Company of the
Holders of the Securities and creditors of the Company other
than the holders of Senior Indebtedness; or (c) prevent the
Trustee or the Holder of any Security from exercising all
remedies otherwise permitted by applicable law upon default
under this Indenture, subject to the rights, if any, under
this Article of the holders of Senior Indebtedness to receive
cash, property and securities otherwise payable or deliverable
to the Trustee or such Holder.
SECTION 13.8. Trustee to Effectuate Subordination.
Each holder of a Security by his acceptance thereof
authorizes and directs the Trustee on his behalf to take such
action as may be necessary or appropriate to effectuate the
subordination provided in this Article and appoints the
Trustee his attorney-in-fact for any and all such purposes.
SECTION 13.9. No Waiver of Subordination Provisions.
No right of any present or future holder of any
Senior Indebtedness to enforce subordination as herein
provided shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of the
Company or by any act or failure to act, in good faith, by any
such holder, or by any non-compliance by the Company with the
terms, provisions and covenants of this Indenture, regardless
of any knowledge thereof any such holder may have or be
otherwise charged with.
Without in any way limiting the generality of the
foregoing paragraph, the holders of Senior Indebtedness may,
at any time and from time to time, without the consent of or
notice to the Trustee or the Holders of the Securities,
without incurring responsibility to the Holders of the
Securities and without impairing or releasing the subordina-
tion provided in this Article or the obligations hereunder of
the Holders of the Securities to the holders of Senior
Indebtedness, do any one or more of the following: (i) change
the manner, place or terms of payment or extend the time of
payment of, or renew or alter, Senior Indebtedness, or other-
wise amend or supplement in any manner Senior Indebtedness or
any instrument evidencing the same or any agreement under
which Senior Indebtedness is outstanding; (ii) sell, exchange,
release or otherwise deal with any property pledged, mortgaged
or otherwise securing Senior Indebtedness; (iii) release any
Person liable in any manner for the collection of Senior
Indebtedness; and (iv) exercise or refrain from exercising any
rights against the Company and any other Person.
SECTION 13.10. Notice to Trustee.
The Company shall give prompt written notice to the
Trustee of any fact known to the Company which would prohibit
the making of any payment to or by the Trustee in respect of
the Securities. Notwithstanding the provisions of this
Article or any other provision of this Indenture, the Trustee
shall not be charged with knowledge of the existence of any
facts which would prohibit the making of any payment to or by
the Trustee in respect of the Securities, unless and until the
Trustee shall have received written notice thereof from the
Company or a holder of Senior Indebtedness or from any trustee
therefor; and, prior to the receipt of any such written
notice, the Trustee, subject to the provisions of Section 6.1,
shall be entitled in all respects to assume that no such facts
exist; provided, however, that if the Trustee shall not have
received the notice provided for in this Section at least two
Business Days prior to the date upon which by the terms hereof
any money may become payable for any purpose (including,
without limitation, the payment of the principal of (and
premium, if any) or interest on any Security), then, anything
herein contained to the contrary notwithstanding, the Trustee
shall have full power and authority to receive such money and
to apply the same to the purpose for which such money was
received and shall not be affected by any notice to the
contrary which may be received by it within two Business Days
prior to such date.
Subject to the provisions of Section 6.1, the
Trustee shall be entitled to rely on the delivery to it of a
written notice by a Person representing himself to be a holder
of Senior Indebtedness (or a trustee therefor) to establish
that such notice has been given by a holder of Senior
Indebtedness (or a trustee therefor). In the event that the
Trustee determines in good faith that further evidence is
required with respect to the right of any Person as a holder
of Senior Indebtedness to participate in any payment or
distribution pursuant to this Article, the Trustee may request
such Person to furnish evidence to the reasonable satisfaction
of the Trustee as to the amount of Senior Indebtedness held by
such Person, the extent to which such Person is entitled to
participate in such payment or distribution and any other
facts pertinent to the rights of such Person under this
Article, and if such evidence is not furnished, the Trustee
may defer any payment to such Person pending judicial
determination as to the right of such Person to receive such
payment.
SECTION 13.11. Reliance on Judicial Order or Certificate of
Liquidating Agent.
Upon any payment or distribution of assets of the
Company referred to in this Article, the Trustee, subject to
the provisions of Section 6.1, and the Holders of the
Securities shall be entitled to rely upon any order or decree
entered by any court of competent jurisdiction in which such
insolvency, bankruptcy, receivership, liquidation, reorganiza-
tion, dissolution, winding up or similar case or proceeding is
pending, or a certificate of the trustee in bankruptcy,
receiver, liquidating trustee, custodian, assignee for the
benefit of creditors, agent or other Person making such
payment or distribution, delivered to the Trustee or to the
Holders of Securities, for the purpose of ascertaining the
Persons entitled to participate in such payment or distribu-
tion, the holders of the Senior Indebtedness and other
indebtedness of the Company, the amount thereof or payable
thereon, the amount or amounts paid or distributed thereon and
all other facts pertinent thereto or to this Article.
SECTION 13.12. Trustee Not Fiduciary for Holders of Senior
Indebtedness.
The Trustee shall not be deemed to owe any fiduciary
duty to the holders of Senior Indebtedness and shall not be
liable to any such holders if it shall in good faith
mistakenly pay over or distribute to Holders of Securities or
to the Company or to any other Person cash, property or
securities to which any holders of Senior Indebtedness shall
be entitled by virtue of this Article or otherwise.
SECTION 13.13. Rights of Trustee as Holder of Senior
Indebtedness; Preservation of Trustee's
Rights.
The Trustee in its individual capacity shall be
entitled to all the rights set forth in this Article with
respect to any Senior Indebtedness which may at any time be
held by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in this Indenture shall deprive the
Trustee of any of its rights as such holder.
Nothing in this Article shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 6.7.
SECTION 13.14. Article Applicable to Paying Agents.
In case at any time any Paying Agent other than the
Trustee shall have been appointed by the Company and be then
acting hereunder, the term "Trustee" as used in this Article
shall in such case (unless the context otherwise requires) be
construed as extending to and including such Paying Agent
within its meaning as fully for all intents and purposes as if
such Paying Agent were named in this Article in addition to or
in place of the Trustee; provided, however, that Section 13.13
shall not apply to the Company or any Affiliate of the Company
if it or such Affiliate acts as Paying Agent.
SECTION 13.15. Certain Conversions Deemed Payment.
For the purposes of this Article only, (1) the
issuance and delivery of junior securities upon conversion of
Securities in accordance with Article Twelve shall not be
deemed to constitute a payment or distribution on account of
the principal of or premium or interest on Securities or on
account of the purchase or other acquisition of Securities,
and (2) the payment, issuance or delivery of cash, property or
securities (other than junior securities) upon conversion of
a Security shall be deemed to constitute payment on account of
the principal of such Security. For the purposes of this
Section, the term "junior securities" means (a) shares of any
stock of any class of the Company and any cash, property or
securities into which the Securities are convertible pursuant
to Article Twelve and (b) securities of the Company which are
subordinated in right of payment to all Senior Indebtedness
which may be outstanding at the time of issuance or delivery
of such securities to substantially the same extent as, or to
a greater extent than, the Securities are so subordinated as
provided in this Article. Nothing contained in this Article
or elsewhere in this Indenture or in the Securities is
intended to or shall impair, as among the Company, its
creditors other than holders of Senior Indebtedness and the
Holders of the Securities, the right, which is absolute and
unconditional, of the Holder of any Security to convert such
Security in accordance with Article Twelve.
ARTICLE FOURTEEN
REPURCHASE OF SECURITIES AT THE OPTION OF THE
HOLDER UPON A CHANGE IN CONTROL
SECTION 14.1. Right to Require Repurchase.
In the event that a Change in Control (as
hereinafter defined) shall occur, then each Holder shall have
the right, at the Holder's option, to require the Company to
repurchase, and upon the exercise of such right the Company
shall repurchase, all of such Holder's Securities, or any
portion of the principal amount thereof that is equal to
U.S.$5,000 or any integral multiple of U.S.$1,000 in excess
thereof (provided that no single Bearer Security may be
repurchased in part, and no single Registered Security may be
repurchased in part unless the portion of the principal amount
of such Registered Security to be Outstanding after such
repurchase is equal to U.S.$5,000 or integral multiples of
U.S.$1,000 in excess thereof), on the date (the "Repurchase
Date") that is 45 days after the date of the Company Notice
(as defined in Section 14.2) at a purchase price equal to 100%
of the principal amount of the Securities to be repurchased
(the "Repurchase Price") plus interest accrued to the
Repurchase Date; provided, however, that installments of
interest on Bearer Securities whose Stated Maturity is on or
prior to the Repurchase Date shall be payable only upon
presentation and surrender of coupons for such interest (at an
office or agency outside the United States, except as
otherwise provided in the form of Bearer Security set forth in
Section 2.2(a)); and provided, further, that installments of
interest on Registered Securities whose Stated Maturity is on
or prior to the Repurchase Date shall be payable to the
Holders of such Securities, or one or more Predecessor
Securities, registered as such on the relevant Record Date
according to their terms and the provisions of Section 3.7.
Such right to require the repurchase of the Securities shall
not continue after a discharge of the Company from its
obligations with respect to the Securities in accordance with
Article Four, unless a Change in Control shall have occurred
prior to such discharge. At the option of the Company, the
Repurchase Price may be paid in cash or, except as otherwise
provided in Section 14.2(j), by delivery of shares of common
stock having a fair market value equal to the Repurchase
Price; provided that payment may not be made in common stock
unless at the time of payment such stock is listed on a
national securities exchange or quoted on the Nasdaq National
Market. For purposes of this Section, the fair market value
of shares of common stock shall be determined by the Company
and shall be equal to 95% of the average of the Closing Prices
Per Share for the five consecutive Trading Days ending on and
including the third Trading Day immediately preceding the
Repurchase Date. Whenever in this Indenture (including
Sections 2.2, 3.1, 5.1(2) and 5.8) there is a reference, in
any context, to the principal of any Security as of any time,
such reference shall be deemed to include reference to the
Repurchase Price payable in respect of such Security to the
extent that such Repurchase Price is, was or would be so
payable at such time, and express mention of the Repurchase
Price in any provision of this Indenture shall not be
construed as excluding the Repurchase Price in those
provisions of this Indenture when such express mention is not
made.
SECTION 14.2. Notices; Method of Exercising
Repurchase
Right, Etc.
(a) Unless the Company shall have theretofore
called for redemption all of the Outstanding Securities, on or
before the 30th day after the occurrence of a Change of
Control, the Company or, at the request and expense of the
Company, the Trustee, shall give to all Holders of Securities,
in the manner provided in Section 1.6, notice (the "Company
Notice") of the occurrence of the Change of Control and of the
repurchase right set forth herein arising as a result thereof.
The Company shall also deliver a copy of such notice of a
repurchase right to the Trustee.
Each notice of a repurchase right shall state:
(1) the Repurchase Date,
(2) the date by which the repurchase right must be
exercised,
(3) the Repurchase Price,
(4) a description of the procedure which a Holder
must follow to exercise a repurchase right, and the place
or places where such Securities, together with all
coupons appertaining thereto, if any, maturing after the
Repurchase Date, are to be surrendered for payment of the
Repurchase Price and accrued interest, if any,
(5) that on the Repurchase Date the Repurchase
Price, and accrued interest, if any, will become due and
payable upon each such Security designated by the Holder
to be repurchased, and that interest thereon shall cease
to accrue on and after said date,
(6) the Conversion Price then in effect, the date
on which the right to convert the principal amount of the
Securities to be repurchased will terminate and the place
or places where such Securities, together with all
unmatured coupons appertaining thereto, may be
surrendered for conversion, and
(7) the place or places that the certificate
required by Section 2.2 shall be delivered, and the form
of such certificate.
In addition, at least two Business Days preceding
the Repurchase Date, the Company shall give to all Holders of
the Securities and coupons, in the manner provided in Section
1.6, notice specifying whether the Repurchase Price will be
payable in cash or shares of common stock and shall deliver a
copy of such notice to the Trustee.
No failure of the Company to give the foregoing
notices or defect therein shall limit any Holder's right to
exercise a repurchase right or affect the validity of the
proceedings for the repurchase of Securities.
If any of the foregoing provisions or other
provisions of this Article are inconsistent with applicable
law, such law shall govern.
(b) To exercise a repurchase right, a Holder shall
deliver to the Trustee or any Paying Agent on or before the
30th day after the date of the Company Notice (i) written
notice of the Holder's exercise of such right, which notice
shall set forth the name of the Holder, the principal amount
of the Securities to be repurchased (and, if any Registered
Security is to repurchased in part, the serial number thereof,
the portion of the principal amount thereof to be repurchased
and the name of the Person in which the portion thereof to
remain Outstanding after such repurchase is to be registered)
and a statement that an election to exercise the repurchase
right is being made thereby, and, in the event that the
Repurchase Price shall be paid in shares of common stock, the
name or names (with addresses) in which the certificate or
certificates for shares of common stock shall be issued, and
(ii) the Securities with respect to which the repurchase right
is being exercised, together with all coupons, if any,
appertaining thereto maturing after the Repurchase Date;
provided, however, that Bearer Securities shall be delivered
only to an office of a Paying Agent located outside the United
States except in the limited circumstances described in
Section 10.2. Such written notice shall be irrevocable,
except that the right of the Holder to convert the Securities
with respect to which the repurchase right is being exercised
shall continue until the close of business on the second
Trading Day preceding the Repurchase Date.
(c) In the event a repurchase right shall be
exercised in accordance with the terms hereof, the Company
shall pay or cause to be paid to the Trustee or the Paying
Agent in London, England, the Repurchase Price in cash or
shares of common stock, as provided above, for payment to the
Holder on the Repurchase Date or, if shares of common stock
are to be paid, as promptly after the Repurchase Date as
practicable, together with accrued and unpaid interest to the
Repurchase Date payable with respect to the Securities as to
which the purchase right has been exercised; provided,
however, that installments of interest that mature on or prior
to the Repurchase Date shall be payable in cash, in the case
of Registered Securities, to the Holders of such Securities,
or one or more Predecessor Securities, registered as such at
the close of business on the relevant Regular Record Date and,
in the case of Bearer Securities, to the holder of the coupon
with respect thereto, in each case according to the terms and
provisions of Article Three; and provided, further, that
Bearer Securities and coupons shall be so payable only at an
office or agency outside the United States (except as
otherwise provided in the form of Bearer Security set forth in
Section 2.2(a)).
(d) If any Bearer Security surrendered for
repurchase shall not be accompanied by all appurtenant coupons
maturing after the Repurchase Date, such Security may be paid
after deducting from the Repurchase Price an amount equal to
the face amount of all such missing coupons or the surrender
of such missing coupons or coupon may be waived by the Company
and the Trustee, if there be furnished to them such security
or indemnity as they may require to save each of them and any
Paying Agent harmless. If thereafter the Holder of such
Bearer Security shall surrender to any Paying Agent any such
missing coupon in respect of which a deduction shall have been
made from the Repurchase Price, if any, such Holder shall be
entitled to receive the amount so deducted; provided, however,
that interest represented by coupons shall be payable only
upon presentation and surrender of those coupons at an office
or agency located outside of the United States (except as
otherwise provided in the form of Bearer Security set forth in
Section 2.2(a)).
(e) If any Security (or portion thereof)
surrendered for repurchase shall not be so paid on the
Repurchase Date, the principal amount of such Security (or
portion thereof, as the case may be) shall, until paid, bear
interest to the extent permitted by applicable law from the
Repurchase Date at the rate of 4-1/2% per annum, and each
Security shall remain convertible into Common Stock until the
principal of such Security (or portion thereof, as the case
may be) shall have been paid or duly provided for. If payment
is made or duly provided for on the Repurchase Date, from and
after the Repurchase Date the Securities surrendered for
repurchase shall cease to accrue interest and coupons
appertaining to any Bearer Security surrendered for repurchase
shall, except as provided in Sections 14.2(c) and (d), be
void.
(f) Any Registered Security which is to be
repurchased only in part shall be surrendered to the Trustee
(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 make available for delivery to the Holder of
such Registered Security without service charge, a new
Registered Security or Registered Securities, containing
identical terms and conditions, each in an authorized
denomination in aggregate principal amount equal to and in
exchange for the unrepurchased portion of the principal of the
Registered Security so surrendered.
(g) Any issuance of shares of common stock in
respect of the Repurchase Price shall be deemed to have been
effected immediately prior to the close of business on the
Repurchase Date and the Person or Persons in whose name or
names any certificate or certificates for shares of Common
Stock shall be issuable upon such repurchase shall be deemed
to have become on the Repurchase Date the holder or holders of
record of the shares represented thereby; provided, however,
that any surrender for repurchase on a date when the stock
transfer books of the Company shall be closed shall constitute
the Person or Persons in whose name or names the certificate
or certificates for such shares are to be issued as the
recordholder or holders thereof for all purposes at the
opening of business on the next succeeding day on which such
stock transfer books are open. No payment or adjustment shall
be made for dividends or distributions on any common stock
issued upon repurchase of any Security declared prior to the
Repurchase Date.
(h) No fractions of shares shall be issued upon
repurchase of Securities. If more than one Security shall be
repurchased from the same Holder and the Repurchase Price
shall be payable in shares of common stock, the number of full
shares which shall be issuable upon such repurchase shall be
computed on the basis of the aggregate principal amount of the
Securities so repurchased. Instead of any fractional share of
common stock which would otherwise be issuable on the
repurchase of any Security or Securities, the Company will
deliver to the applicable Holder its check for the current
market value of such fractional share. The current market
value of a fraction of a share is determined by multiplying
the current market price of a full share by the fraction, and
rounding the result to the nearest cent. For purposes of this
Section, the current market price of a share of common stock
is the Closing Price Per Share of the Common Stock on the
Trading Day immediately preceding the Repurchase Date.
(i) Any issuance and delivery of certificates for
shares of common stock on repurchase of Securities shall be
made without charge to the Holder of Securities being repur-
chased for such certificates or for any tax or duty in respect
of the issuance or delivery of such certificates or the
securities represented thereby; provided, however, that the
Company shall not be required to pay any tax or duty which may
be payable in respect of (i) income of the Holder or (ii) any
transfer involved in the issuance or delivery of certificates
for shares of Common Stock in a name other than that of the
Holder of the Securities being repurchased, and no such
issuance or delivery shall be made unless and until the Person
requesting such issuance or delivery has paid to the Company
the amount of any such tax or duty or has established, to the
satisfaction of the Company, that such tax or duty has been
paid.
(j) If any shares of Common Stock to be issued upon
repurchase of Securities hereunder require registration with
or approval of any governmental authority under any federal or
state law before such shares may be validly issued or
delivered upon repurchase, the Company covenants that it will
in good faith and as expeditiously as possible endeavor to
secure such registration or approval, as the case may be;
provided, however, that nothing in this Section shall be
deemed to affect in any way the obligations of the Company to
repurchase Securities as provided in this Article and if such
registration is not completed or does not become effective or
such approval is not obtained prior to the Repurchase Date,
the Repurchase Price shall be paid in cash.
(k) The Company covenants that all shares of Common
Stock which may be issued upon repurchase of Securities will
upon issue be duly and validly issued and fully paid and
non-assessable.
SECTION 14.3. Certain Definitions.
For purposes of this Article Fourteen,
(a) the term "beneficial owner" shall be determined
in accordance with Rule 13d-3, as in effect on the date of the
original execution of this Indenture, promulgated by the
Commission pursuant to the Exchange Act;
(b) the term "Capital Stock" shall mean capital
stock of the Company that does not rank prior, as to the
payment of dividends or as to the distribution of assets upon
any voluntary or involuntary liquidation, dissolution or
winding up of the Company, to shares of capital stock of any
other class of the Company;
(c) a "Change in Control" shall be deemed to have
occurred at the time, after the original issuance of the
Securities, of:
(i) the acquisition by any Person of beneficial
ownership, directly or indirectly, through a
purchase, merger or other acquisition
transaction or series of transactions, of
shares of capital stock of the Company
entitling such Person to exercise 50% or more
of the total voting power of all shares of
capital stock of the Company entitled to vote
generally in the elections of directors (any
shares of voting stock of which such Person is
the beneficial owner that are not then
outstanding being deemed outstanding for
purposes of calculating such percentage); or
(ii) any consolidation of the Company with, or
merger of the Company into, any other Person,
any merger of another Person into the Company,
or any sale or transfer of all or
substantially all of the assets of the Company
to another Person (other than a merger (x)
which does not result in any reclassification,
conversion, exchange or cancellation of
outstanding shares of Capital Stock or (y)
which is effected solely to change the
jurisdiction of incorporation of the Company
and results in a reclassification, conversion
or exchange of outstanding shares of Common
Stock into solely shares of common stock);
provided, however, that, a Change in Control shall not be
deemed to have occurred if either (x) the Closing Price Per
Share of the Common Stock on any five Trading Days within the
period of 10 consecutive Trading Days ending immediately after
the later of the date of the Change in Control or the date of
the public announcement of the Change in Control (in the case
of a Change in Control under Clause (i) above) or the period
of 10 consecutive Trading Days ending immediately prior to the
date of the Change in Control (in the case of a Change in
Control under Clause (ii) above) shall equal or exceed 105% of
the Conversion Price or (y) all the consideration (excluding
cash payments for fractional shares) to be paid for the Common
Stock in the transaction or transactions constituting the
Change in Control consists of shares of common stock traded on
a national securities exchange or quoted on the Nasdaq
National Market and as a result of such transaction or
transactions the Securities become convertible solely into
such common stock; and
(d) the term "Person" shall include any syndicate
or group which would be deemed to be a "person" under Section
13(d)(3) of the Exchange Act, as in effect on the date of the
original execution of this Indenture.
ARTICLE FIFTEEN
HOLDERS LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 15.1. Company to Furnish Trustee
Names and Addresses of Holders.
The Company will furnish or cause to be furnished to
the Trustee:
(a) semi-annually, not more than 15 days after the
Regular Record Date, a list, in such form as the Trustee
may reasonably require, of the names and addresses of the
Holders of Registered Securities as of such Regular
Record Date, and
(b) at such other times as the Trustee may
reasonably 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 15.2. Preservation of Information.
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 16.1 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
pursuant to Section 16.1 upon receipt of a new list so
furnished.
_____________________
This instrument may be executed in any number of
counterparts, each of which so executed shall be deemed to be
an original, but all such counterparts shall together
constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused
this Indenture to be duly executed, and their respective
corporate seals to be hereunto affixed and attested, all as of
the day and year first above written.
UNITED WASTE SYSTEMS, INC.
By_________________________
Name:
Title:
Attest:
______________________________
Name:
Title:
BANKERS TRUST COMPANY, Trustee
By______________________________
Name:
Title:
Attest:
_______________________________
Name:
Title:
STATE OF )
) : ss.:
COUNTY OF )
On the fifth day of June, 1996, before me personally
came , to me known, who, being by me
duly sworn, did depose and say that he is ________________ of
United Waste Systems, Inc., 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.
______________________________
Notary Public
STATE OF NEW YORK )
): ss.:
COUNTY OF NEW YORK )
On the fifth day of June, 1996, before me personally
came , to me known, who, being by me duly
sworn, did depose and say that he is of
Bankers Trust 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
pursuant to the bylaws of said corporation; and that he signed
his name thereto by like authority.
________________________________
Notary Public
<TABLE>
EXHIBIT 11.1
UNITED WASTE SYSTEMS, INC.
STATEMENT REGARDING COMPUTATION OF PER SHARE EARNINGS
<CAPTION>
Nine Months Nine Months
Ended Ended
September 30, 1996 September 30, 1995(2)
<S> <C> <C>
Primary:
Net income $ 23,813,167 $ 18,394,654
Historical weighted average
Common shares outstanding 36,893,808 31,147,128
Dilution of common stock options
and warrants (1) 2,559,722 2,826,773
Weighted average common shares
outstanding 39,453,530 33,973,901
Earnings per common share $.60 $.54
Three Months Three Months
Ended Ended
September 30, 1996 September 30, 1995(2)
Net income $ 11,392,858 $ 8,729,243
Historical weighted average
Common shares outstanding 37,139,064 33,570,910
Dilution of common stock
options and warrants(1) 2,829,086 3,035,609
Weighted average of common
shares outstanding 39,968,150 36,606,519
Earnings per common share $.29 $.24
</TABLE>
- --------------------
(1) Based upon the treasury stock method
(2) All share and per-share data reflects the June 1996 two-for-one stock split
EXHIBIT 11.1
<TABLE>
UNITED WASTE SYSTEMS, INC.
STATEMENT REGARDING COMPUTATION OF PER SHARE EARNINGS
<CAPTION>
Nine Months
Ended
September 30, 1995 (2)
<S> <C>
Fully Diluted:
Net income $ 18,394,654
Interest on convertible debt
Earnings available
to common stockholders $ 18,394,654
Historical weighted average
Common shares outstanding 31,147,128
Dilution of common
stock options and warrants(1) 3,356,638
Assumed conversion of
convertible debt
Weighted average common
shares outstanding 34,503,766
Earnings per common shares $.53
Three Months
Ended
September 30, 1996(2)
Net income $ 11,392,858
Interest on convertible debt 1,029,375
Earnings available to
common stockholders $ 12,422,233
Historical weighted average
Common shares outstanding 37,139,064
Dilution of common stock
options and warrants(1) 3,169,288
Assumed conversion of
convertible debtk 4,615,385
Weighted average common
shares outstanding 44,923,737
Earnings per common share $.28
</TABLE>
- --------------
(1) Based upon the treasury stock method
(2) All share and per-share data reflects the June 1996 two-for-one stock split
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from the Company's
condensed consolidated financial statements for the nine months ended September
30, 1996 and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<CASH> 32,729,728
<SECURITIES> 0
<RECEIVABLES> 51,917,972
<ALLOWANCES> 3,262,000
<INVENTORY> 0
<CURRENT-ASSETS> 97,698,259
<PP&E> 432,894,574
<DEPRECIATION> 86,629,000
<TOTAL-ASSETS> 705,561,975
<CURRENT-LIABILITIES> 73,956,193
<BONDS> 274,640,399
0
0
<COMMON> 37,238
<OTHER-SE> 279,749,088
<TOTAL-LIABILITY-AND-EQUITY> 705,561,975
<SALES> 0
<TOTAL-REVENUES> 241,884,894
<CGS> 0
<TOTAL-COSTS> 149,595,905
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 11,054,451
<INCOME-PRETAX> 41,290,421
<INCOME-TAX> 17,477,254
<INCOME-CONTINUING> 23,813,167
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 23,813,167
<EPS-PRIMARY> .60
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The Schedule contains summary financial information extracted from the Company's
condensed consolidated financial statements for the three months ended March 31,
1996 and is qualified in its entirety by reference to such financial statements.
</LEGEND>
<RESTATED>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 3,237,235
<SECURITIES> 0
<RECEIVABLES> 43,332,666
<ALLOWANCES> 3,000,000
<INVENTORY> 0
<CURRENT-ASSETS> 58,324,744
<PP&E> 373,755,768
<DEPRECIATION> 63,344,042
<TOTAL-ASSETS> 580,238,235
<CURRENT-LIABILITIES> 61,669,349
<BONDS> 187,161,441
0
0
<COMMON> 18,428
<OTHER-SE> 261,850,913
<TOTAL-LIABILITY-AND-EQUITY> 580,238,235
<SALES> 0
<TOTAL-REVENUES> 69,580,498
<CGS> 0
<TOTAL-COSTS> 45,454,342
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 3,408,687
<INCOME-PRETAX> 9,447,018
<INCOME-TAX> 3,669,434
<INCOME-CONTINUING> 5,777,584
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 5,777,584
<EPS-PRIMARY> .15
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from the Company's
condensed consolidated financial statements for the six months ended June 30,
1996 and is qualified in its entirety by reference to such financial statements.
</LEGEND>
<RESTATED>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 62,309,722
<SECURITIES> 0
<RECEIVABLES> 49,657,663
<ALLOWANCES> 3,132,000
<INVENTORY> 0
<CURRENT-ASSETS> 124,500,816
<PP&E> 410,583,220
<DEPRECIATION> 78,375,600
<TOTAL-ASSETS> 697,366,506
<CURRENT-LIABILITIES> 71,769,531
<BONDS> 281,697,049
0
0
<COMMON> 37,087
<OTHER-SE> 273,136,258
<TOTAL-LIABILITY-AND-EQUITY> 697,366,506
<SALES> 0
<TOTAL-REVENUES> 151,838,019
<CGS> 0
<TOTAL-COSTS> 96,479,784
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 7,206,432
<INCOME-PRETAX> 21,606,028
<INCOME-TAX> 8,739,293
<INCOME-CONTINUING> 12,866,735
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 12,866,735
<EPS-PRIMARY> .33<F1>
<EPS-DILUTED> 0
<FN>
<F1>The Company effected a two-for-one stock split on June 18, 1996. Previously
filed financial data schedules have not been restated for this
recapitalization.
</FN>
</TABLE>
EXHIBIT 99
Factors that May Influence Future Results and Accuracy of
Forward-Looking Statements
The Company, in an effort to help keep its stockholders and
the public informed about the Company's operations, may from time
to time issue certain statements, either in writing or orally,
that contain or may contain forward-looking information. There
can be no assurance, however, that actual results will not differ
materially from the Company's expectations, statements or
projections. Factors that could cause actual results to differ
from the Company's expectations, statements or projections
include the risks and uncertainties relating to the Company's
business described below.
Economic Conditions: The Company's business is affected by
general economic conditions. There can be no assurance that an
economic downturn will not result in a reduction in the volume of
waste being disposed of at the Company's operations and/or the
price that the Company can charge for its services.
Weather Conditions: Protracted periods of inclement weather
may adversely affect the Company's operations by interfering with
collection and landfill operations, delaying the development of
landfill capacity and/or reducing the volume of waste generated
by the Company's customers. In addition, particularly harsh
weather conditions may result in the temporary suspension of
certain of the Company's operations.
Competition: The solid waste collection and disposal
business is highly competitive and requires substantial amounts
of capital. The Company competes with numerous waste management
companies, a number of which have significantly larger operations
and greater resources than the Company. The Company also
competes with those counties and municipalities that maintain
their own waste collection and disposal operations.
Ongoing Capital Requirements: To the extent that internally
generated cash and cash available under the Company's existing
revolving credit facility are not sufficient to provide the cash
required for future operations, capital expenditures,
acquisitions, debt repayment obligations and/or financial
assurance obligations, the Company will require additional equity
and/or debt financing in order to provide such cash. There can be
no assurance, however, that such financing will be available or,
if available, will be available on terms satisfactory to the
Company.
Dependence on Senior Management: The Company is highly
dependent upon its senior management team. The loss of the
services of any member of senior management may have a material
adverse effect on the Company.
Environmental and Land Use Matters: The Company is subject
to extensive and evolving environmental and land use laws and
regulations, which have become increasingly stringent as a result
of greater public interest in protecting the environment. These
laws and regulations affect the Company's business in many ways,
including those set forth below. See "Business-Environmental
Regulations" for further information concerning the matters set
forth below.
In connection with most of its operations, the Company is
required to obtain and/or maintain in effect various permits and
other governmental approvals, including approvals relating to
zoning, land use and environmental matters. These permits and
approvals are difficult, time consuming and costly to obtain and
maintain in effect and, once obtained, may be subject to
modification, renewal or revocation by the issuing agency. There
can be no assurance that the Company will be successful in
obtaining and maintaining in effect the permits and approvals
required for the successful operation and growth of its business
(including permits and approvals required to develop timely
additional disposal capacity to replace capacity that is
exhausted). The failure by the Company to obtain or maintain in
effect a permit significant to its business could adversely
affect the Company's business and financial condition.
The Company's operations are subject to and substantially
affected by extensive federal, state and local laws and
regulations, which govern environmental, permitting, zoning, land
use, health, safety and other matters. Compliance with these
laws and regulations require significant expenditures, and future
changes in these laws and regulations may materially increase the
amount of such required expenditures. In addition, such laws and
regulations may impose restrictions on operations that could
adversely affect the Company, such as limitations on the
expansion of disposal facilities or limitations on, or the
banning of, waste from out-of-state or locality or certain
categories of wastes.
There may be various adverse consequences to the Company in
the event that the Company fails to comply with applicable laws,
regulations or permits, in the event that a facility owned or
operated by the Company causes environmental damage or in the
event that waste transported by the Company causes environmental
damage at another site. Under certain circumstance, the Company,
as a successor owner, may also be responsible for any such
failure by a predecessor owner and/or for damage caused by a
predecessor owner. These adverse consequences may include
substantial monetary penalties; the need to undertake
investigatory or remedial activities; the need to curtail or
terminate the operations involved or affected; the revocation or
denial of permits or other approvals; the imposition of liability
on the Company in respect of any environmental damage at its
landfill sites or caused by its landfills or other facilities or
environmental damage at other sites associated with waste
transported by the Company; and criminal liability for the
Company or its employees. Any of the foregoing could adversely
affect the Company's business and financial condition.
Limits on Insurance Coverage: As described under "Business-
Liability Insurance and Bonding," the Company's insurance for
environmental liability is very limited because the Company
believes that the cost for such insurance is high relative to the
coverage it would provide. Due to the limited nature of the
Company's insurance coverage for environmental liability, if the
Company were to incur liability for environmental damage, its
business and financial condition could be materially adversely
affected.
Alternatives to Landfill Disposal: Alternatives to landfill
disposal, such as recycling and composting, are increasingly
being used. In addition, in certain of the Company's markets
incineration is an alternative to landfill disposal. There also
has been an increasing trend at the state and local levels to
mandate recycling and waste reduction at the source and to
prohibit the disposal of certain type of wastes, such as yard
wastes, at landfills. These developments may result in the volume
of waste going to landfills being reduced in certain areas, which
may affect the Company's ability to operate its landfills at
their full capacity and/or affect the prices that can be charged
for landfill disposal services.
Commodity Risk Upon Resale of Recyclables: A portion of the
Company's revenues from waste reuse and reduction programs is
derived from the sale of recyclable waste products. The resale
prices of, and demand for, recyclable waste products can vary
significantly and are subject to changing market conditions.
Accordingly, the Company's revenues from such sales may
materially vary from period to period.
Capitalized Expenditures: In accordance with generally
accepted accounting principles, the Company capitalizes certain
expenditures and advances relating to its acquisitions, pending
acquisitions and landfill development and expansion projects.
Indirect acquisition costs, such as executive salaries, general
corporate overhead, public affairs and other corporate services,
are expensed as incurred. The Company's policy is to charge
against earnings any unamortized capitalized expenditures and
advances (net of any portion thereof that the Company estimates
will be recoverable, through sale or otherwise) relating to any
operation that is permanently shut down, any pending acquisition
that is not consummated, and any landfill development or
expansion project that is not successfully completed. There can
be no assurance that the Company in future periods will not be
required to incur a charge against earnings in accordance with
such policy, which charge, depending upon the magnitude thereof,
could adversely affect the Company's results of operations.
Risks Associated with Acquisitions: In connection with any
acquisition made by the Company, there may be liabilities that
the Company fails or is unable to discover, including liabilities
arising from environmental contamination or non-compliance by
prior owners with environmental laws or regulatory requirements,
and for which the Company, as a successor owner, may be
responsible.
As the Company completes acquisitions in a region, it seeks
to achieve synergies and efficiencies through the integration of
newly acquired and existing operations in the region. There can
be no assurance, however, that the Company will be successful in
this regard or that such efforts may not in certain circumstances
adversely affect its existing operations.
Availability of Acquisition Targets: The Company's ongoing
acquisition program is a key element of its expansion strategy.
There can be no assurance, however, that the Company will succeed
in locating appropriate acquisition candidates that can be
acquired at price levels that the Company considers appropriate.
