As filed with the Securities and Exchange Commission on May 27, 1999
Registration No. 333-______
SECURITIES AND EXCHANGE COMMISSION
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
AMERICA ONLINE, INC.
(Exact name of registrant as specified in its charter)
Delaware
54-1322110
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer
Identification No.)
22000 AOL Way, Dulles, Virginia 20166-9323 (703) 265-1000
(Address, including zip code, and telephone, including area code, of
registrant's principal
executive offices)
Stephen M. Case
Chief Executive Officer
America Online, Inc.
22000 AOL Way
Dulles, Virginia 20166-9323
(703) 265-1000
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copy to:
Sheila A. Clark, Esquire
Senior Vice President and
Acting General Counsel
America Online, Inc.
22000 AOL Way
Dulles, Virginia 20166-9323
(703) 265-1000
Approximate date of commencement of proposed sale to public: As soon as
practicable after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. ___
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. |X| If this Form is filed to
register additional securities for an offering pursuant to Rule 462(b) under the
Securities Act, please check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. If this Form is a post-effective amendment filed pursuant
to Rule 462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier registration
statement for the same offering. X
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. X
CALCULATION OF REGISTRATION FEE
<TABLE>
Title of Securities to be Amount Proposed Proposed Amount of
Registered(1) to be Maximum Offering Maximum Aggregate Offering Registration
Registered Price Per Share Price(2) Fee(3)(4)
Debt Securities, Preferred
Stock and Common Stock(5),
$.01 par value,
Depositary Shares
<S> <C> <C> <C> <C>
representing Preferred (8) (8) $5,000,000,000 $1,257,185.10
Stock, Warrants(6) and
Stock Purchase Contracts(7)
</TABLE>
(1) The securities covered by this Registration Statement may be sold or
otherwise distributed separately, together or as units with other
securities covered by this Registration Statement. This Registration
Statement covers offers, sales and other distributions of the
securities listed in this table from time to time at prices to be
determined, as well as Debt Securities issuable upon the exercise of
Debt Warrants so offered or sold, shares of Preferred Stock
distributable upon the termination of a deposit arrangement for
Depositary Shares so offered or sold, and shares of Common Stock
issuable upon the exchange or conversion of Debt Securities or shares
of Preferred Stock so offered or sold that are exchangeable for or
convertible into shares of Common Stock or upon the exercise of Common
Stock Warrants or rights so offered, sold or distributed.
(2) Estimated solely for the purpose of calculating the registration fee in
accordance with Rule 457(o) of the Securities Act of 1933. The
aggregate initial public offering price of the securities registered
hereby will not exceed $5,000,000,000 in U.S. dollars or the U.S.
dollar equivalent in foreign currency or currency units. If any Debt
Securities are issued at an original issue discount, then the offering
price of such Debt Securities shall be such greater principal amount as
shall result in an aggregate initial offering price not to exceed
$5,000,000,000, less the aggregate dollar amount of all securities
previously issued hereunder. No separate consideration will be received
for shares of Preferred Stock or Common Stock that are issued upon
conversion or exchange of Debt Securities, shares of Preferred Stock or
Depositary Shares registered hereunder or for shares of Preferred Stock
distributed upon termination of a deposit arrangement for Depositary
Shares.
(3) The registration fee has been calculated pursuant to Rule 457(o) under
the Securities Act of 1933.
(4) Pursuant to Rule 429 under the Securities Act, $450,220,000 of
securities are being carried forward from Registration Statement on
Form S-3 (No. 333-57153) for inclusion in the Prospectus filed
herewith. A registration fee of $132,814.90 has previously been paid
with respect to such securities. The fee for such securities was paid
in 1998 and thus calculated using the registration fees for fiscal year
1998.
(5) Common Stock being registered hereby includes associated Preferred
Share Purchase Rights, which initially are attached to and traded with
the shares of the Registrant's Common Stock. Value attributable to such
rights, if any, is reflected in the market price of the Common Stock.
(6) The Warrants covered by this Registration Statement may be debt
warrants, preferred stock warrants, depositary share warrants or common
stock warrants.
(7) Stock Purchase Contracts with respect to Common Stock or Preferred
Stock.
(8) The amount to be registered and the proposed maximum offering price per
unit have been omitted pursuant to Rule 457(o) under the Securities Act
of 1933 and General Instruction II.D of Form S-3.
This Registration Statement, which is a new Registration Statement,
also constitutes Post-Effective Amendment No. 1 to Registration Statement No.
333-57153, which was declared effective on June 26, 1998. Such Post-Effective
Amendment No. 1 shall hereafter become effective concurrently with the
effectiveness of this Registration Statement and in accordance with Section 8(c)
of the Securities Act of 1933. Pursuant to Rule 429 under the Securities Act of
1933, the Prospectus filed as part of this Registration Statement also relates
to $450,220,000 of securities previously registered but not sold under the
registrant's Registration Statement No. 333-57153. The $450,220,000 of
securities remaining unsold from Registration Statement No. 333-57153 is hereby
combined with the $4,549,780,000 of securities registered pursuant to this
Registration Statement to enable the registrant to offer an aggregate amount of
$5,000,000,000 of securities pursuant to the combined prospectus.
The registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
The information in this prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
PROSPECTUS
(Subject to completion, dated May 27, 1999)
$5,000,000,000
AMERICA ONLINE, INC.
[AMERICA ONLINE LOGO]
Debt Securities, Common Stock, Preferred Stock
Depositary Shares, Warrants and Stock Purchase
Contracts to Purchase Common Stock or Preferred Stock
We may sell, from time to time, in one or more offerings:
o our debt securities
o shares of our common stock
o shares of our preferred stock
o shares of our preferred stock represented by depositary shares
o warrants exercisable for our debt securities, common stock, preferred
stock or depositary shares
o stock purchase contracts to purchase common stock or preferred stock
The total offering price of these securities, in the aggregate, will
not exceed $5,000,000,000. We will provide the specific terms of any securities
we actually offer for sale in supplements to this prospectus. You should read
this prospectus and the supplements carefully before you decide to invest in
any of these securities.
Our common stock is listed on the New York Stock Exchange, under the
symbol "AOL." Any common stock sold pursuant to a prospectus supplement will be
listed on the New York Stock Exchange.
You should carefully consider the risk factors beginning on page 3 of
this prospectus before purchasing any of the securities offered by this
prospectus.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities, or determined if
this prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
This prospectus may not be used to consummate the sale of any
securities unless accompanied by a prospectus supplement.
The date of this prospectus is , 1999.
The Company
Founded in 1985, America Online, Inc., based in Dulles, Virginia, is
the world leader in interactive services, Web brands, Internet technologies, and
e-commerce services.
America Online has two major lines of Internet businesses organized
into four product groups:
o the interactive online services business, comprised of the Interactive
Services Group, the Interactive Properties Group and the AOL
International Group, and o the enterprise solutions business, comprised
of the Netscape Enterprise Group.
The product groups are described below.
The Interactive Services Group develops and operates branded
interactive services, including: o the AOL service, a worldwide Internet online
service with more than 17 million members o the CompuServe service, a worldwide
Internet online service with approximately 2 million members
o the Netscape Netcenter, an Internet portal with more than 15 million
registered users
o the AOL.COM portal
o the Netscape Navigator and Communicator browsers
The Interactive Properties Group is built around branded properties
that operate across multiple services and platforms, such as:
o Digital City, Inc., the No. 1 branded local content network and
community guide on the AOL service and the Internet
o ICQ, a portal that provides instant communications and chat technology
o MovieFone, Inc., a movie guide and ticketing service provided through
an interactive telephone service and on the AOL service and the
Internet
The AOL International Group oversees the AOL and CompuServe operations
outside the United States.
The Netscape Enterprise Group focuses on providing businesses a range
of software products, technical support, consulting and training services. These
products and services historically have enabled businesses and users to share
information, manage networks and facilitate electronic commerce.
In November 1998, America Online entered into a strategic alliance with
Sun Microsystems, Inc., a leader in network computing products and services, to
accelerate the growth of enterprise-class e-commerce, and to use Sun's Java
technology to develop selected next-generation Internet devices that will help
Internet users access America Online's brands through a variety of hardware
devices. The strategic alliance provides that, over a three year period, we will
develop and market, together with Sun, client software and network application
and server software for electronic commerce, extended communities and
connectivity, including software based in part on the Netscape code base, on Sun
code and technology and on certain America Online services features, to business
enterprises.
America Online was incorporated in Delaware on May 24, 1985. The
principal executive offices are located at 22000 AOL Way, Dulles, Virginia
20166-9323. Our telephone number at that address is (703) 265-1000.
Ratio Of Earnings To Fixed Charges
The following table sets forth the ratio of earnings to fixed charges for
the nine months ended March 31, 1999 and for each of the last five fiscal years.
<TABLE>
Nine Months Ended
March 31, Fiscal Year Ended June 30,
---------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1999 1998 1997 1996 1995 1994
----------------------- --------- --------- --------- ------
Ratio of Earnings to Fixed
Charges........................ 8.07x 0.28x - 5.06x - 1.00x
</TABLE>
For purposes of computing the ratio of earnings to fixed charges, earnings
represent earnings from continuing operations before income taxes plus interest
expense on indebtedness, amortization of debt discount and premium and the
portion of rent expense deemed representative of an interest factor. Fixed
charges include interest on indebtedness (whether expensed or capitalized),
amortization of debt discount and premium and the portion of rent expense deemed
representative of an interest factor. For the years ended June 30, 1997 and
1995, the deficiency of earnings to fixed charges totaled $420 million and $36
million, respectively.
Risk Factors
Before purchasing the shares offered by this prospectus, you should
carefully consider the risks described below, in addition to the other
information presented in this prospectus or incorporated by reference into this
prospectus. If any of the following risks actually occur, they could seriously
harm our business, financial condition or results of operations. In such case,
the trading price of our common stock could decline and you may lose all or part
of your investment.
We Face Competition for Subscription Revenues and the Development and
Sale of Electronic Commerce Infrastructure and Applications.
We face competition from a wide range of other companies in the
communications, advertising, entertainment, information, media, Web-based
services, software, technology, direct mail and electronic commerce fields for
subscription, advertising, and commerce revenue, for the development and sale of
electronic commerce infrastructure and applications and in the development of
distribution technologies and equipment.
o Competitors for subscription revenues include:
-- online services such as the Microsoft Network, AT&T Worldnet and
Prodigy Classic
-- national and local Internet service providers, such as MindSpring
and EarthLink
-- long distance and regional telephone companies offering access as
part of their telephone service, such as AT&T Corp., MCI
WorldCom, Inc., Sprint Corporation and regional Bell operating
companies
-- cable television companies
-- cable Internet access services offered by companies such as
AtHome Corporation and Road Runner Group
o Competitors for advertising and commerce revenues include:
-- online services such as the Microsoft Network, AT&T Worldnet and
Prodigy Classic
-- Web-based navigation and search service companies such as Yahoo!
Inc., Infoseek Corporation, Lycos, Inc. and Excite, Inc.
-- global media companies including newspapers, radio and television
stations and content providers, such as the National Broadcasting
Corporation, CBS Corporation, The Walt Disney Company, Time
Warner Inc., The Washington Post Company and Conde Nast
Publications, Inc.
-- cable Internet access services offered by companies such as
AtHome Corporation and Road Runner Group
o Competitors in the development and sale of electronic commerce
infrastructure and applications include:
-- providers of electronic commerce infrastructure such as server
software, including International Business Machines Corporation,
Microsoft Corporation, Oracle Corporation, Novell, Inc.,
Software.com, Inc., BEA Systems, Inc. and the provider of the
Apache Web Server
-- providers of electronic commerce applications including
International Business Machines Corporation, Oracle Corporation,
General Electric Information Systems, Microsoft Corporation,
PeopleSoft, Inc., SAP A.G., Open Market, Inc., Ariba
Technologies, CommerceOne, Sterling Commerce, Inc. and
BroadVision, Inc.
o Competition in the development of distribution technologies and
equipment includes:
-- broadband distribution technologies used in cable Internet access
services offered by companies such as AtHome Corporation and Road
Runner Group
-- advanced telephone-based access services offered through digital
subscriber line technologies offered by local telecommunications
companies
-- other advanced digital services offered by broadcast, satellite
and wireless companies
-- television-based interactive computer services, such as those
offered by Microsoft's WebTV
-- personal digital assistants, enhanced mobile phones and other
equipment offering functional equivalents to our features
Some of our present competitors and potential future competitors may
have greater financial, technical, marketing or personnel resources than us. The
competitive environment could have a variety of adverse effects on us. For
example, it could:
o require price reductions in the subscription fees for online services
and require increased spending on marketing, network capacity, content
procurement and product development
o negatively impact our ability to generate greater revenues and profits
from sources other than online service subscription revenues, such as
advertising and electronic commerce
o limit our opportunities to enter into or renew agreements with content
providers and distribution partners
o limit our ability to develop new products and services
o limit our ability to continue to grow or sustain our subscriber base
o require price reductions in our enterprise software products
o result in a loss of our market share in the enterprise software industry
o require an increase in our sales and marketing expenditures, and result
in a reduction in our advertising revenues, relating to our Netcenter
Internet portal
Any of the foregoing events could have an adverse impact on revenues or
result in an increase in costs as a percentage of revenues, either of which
could have a material adverse effect on our business, financial condition and
operating results.
We Need to Manage Integration of Our Mergers and Acquisitions
In March 1999 we completed the merger with Netscape Communications
Corporation, a leading provider of software and services for Internet users,
including Netscape Netcenter, and the Netscape Navigator and Netscape
Communicator browsers. The Netscape merger involves risks, including successful
integration and management of the acquired technology, operations and personnel
of Netscape. The integration of America Online and Netscape will be a complex,
time consuming process and may result in a disruption of the combined company if
not completed in a timely and efficient manner. The combined company must
operate as a combined organization utilizing common information and
communications systems, operating procedures, financial controls, human
resources practices and other shared infrastructure. There may be substantial
difficulties, costs and delay involved in integrating America Online and
Netscape, including potential incompatibility of business cultures, perceived
adverse changes in client service standards or business focus, potential sales
channel conflicts, the loss of key employees and diversion of attention of
management from other ongoing business concerns. There can be no assurance we
will be able to successfully manage and operate Netscape. Any of these factors
could have a material adverse effect on our business, financial condition and
operating results.
Additionally, we have acquired and merged with several smaller
companies over the last several years. The integration of these acquired
businesses may also lead to the loss of key employees of the acquired companies
and diversion of the attention of existing management from other ongoing
business concerns.
Potential Year 2000 Problems May Have an Adverse Effect on Our Operations and
Ability to Offer Products and Services Without Interruption
America Online utilizes a significant number of computer software
programs and operating systems across its entire organization, including
applications used in operating its online services and Web sites, the
proprietary software of the AOL and CompuServe services, Netscape software
products, member and customer services, network access, content providers, joint
ventures and various administrative and billing functions. To the extent that
these applications contain source codes that are unable to appropriately
interpret the upcoming calendar year 2000, some level of modification, or even
possibly replacement may be necessary.
In 1997, America Online appointed a Year 2000 Task Force to perform an
audit to assess the scope of America Online's risks and bring its applications
into compliance. This Task Force is undertaking its assessment of America
Online's company-wide compliance and is overseeing testing. America Online's
system hardware components, client and host software, current versions of
Netscape software products and corporate business and information systems are
currently undergoing review and testing. To date, America Online has experienced
very few problems related to Year 2000 testing, and the problems that have been
identified are in the process of being fixed.
America Online intends to make Year 2000 compliant certain versions of
the client software for the AOL service and the CompuServe service that are
available on the Windows and Macintosh operating systems, as well as versions of
Netscape software products that are currently shipped. These versions of the
software incorporate proprietary software and third-party component software
that may not be Year 2000 compliant, and testing continues. A patch or upgrade
may be required for members or customers using some of these versions to achieve
Year 2000 compliance. Over the coming months, America Online will be working to
obtain and make available any required patches or upgrades at no cost to members
of the online services and to communicate their availability. America Online
also will make available, at no additional cost to customers, any required
patches to the versions of Netscape software products currently being shipped to
customers and communicate their availability. In addition, America Online will
be encouraging members and customers to upgrade to versions of the software that
are expected to be Year 2000 compliant, if they have not already done so.
In addition, America Online is continuing to gather information from
its vendors, joint venture partners and content partners about their progress in
identifying and addressing problems that their computer systems may face in
correctly processing date information related to the Year 2000. America Online
intends to continue its efforts to seek reassurances regarding the Year 2000
compliance of vendors, joint venture partners and content partners. In the event
any third parties cannot timely provide America Online with content, products,
services or systems that meet the Year 2000 requirements, the content on America
Online's services, access to America Online's services, the ability to offer
products and services and the ability to process sales could be materially
adversely affected.
The costs incurred through March 1999 to address Year 2000 compliance
were approximately $7 million. America Online currently estimates it will incur
a total of approximately $20 million in costs to support its compliance
initiatives. America Online cannot predict the outcome of its Year 2000 program,
whether third party systems are or will be Year 2000 compliant, the costs
required to address the Year 2000 issue, or whether a failure to achieve
substantial Year 2000 compliance will have a material adverse effect on America
Online's business, financial condition or results of operations. Failure to
achieve Year 2000 compliance could result in interruptions in the work of its
employees, the inability of members and customers to access America Online's
online services and Web sites or errors and defects in the Netscape products.
This, in turn, may result in the loss of subscription services revenue,
advertising and commerce revenue or enterprise solution revenue, the inability
to deliver minimum guaranteed levels of traffic, diversion of development
resources, or increased service and warranty costs. Occurrence of any of these
may also result in additional remedial costs and damage to reputation.
America Online is in the process of developing a contingency plan to
address possible risks to its systems. It is America Online's intention to
implement its contingency plan no later than July 1999.
The Price of Our Common Stock is Volatile
The trading price of our common stock has been and may continue to be
subject to wide fluctuations over short and long periods of time. During the
last year, the closing sale prices of our common stock on the New York Stock
Exchange ranged from $17.25 to $175.25. Our stock price may fluctuate in
response to a number of events and factors, such as:
o quarterly variations in financial results and membership growth and
usage
o the announcement of technological innovations, mergers, acquisitions,
strategic partnerships or new product offerings by America Online or
its competitors
o the entrance of new competitors into the online services market
o changes in financial estimates and recommendations by securities
analysts and news reports relating to trends in the Internet-related
markets
o the operating and stock price performance of other companies that
investors may deem comparable
In addition, the market prices for Internet-related companies have
experienced volatility that often has not been directly related to the operating
performance of such companies. Market and industry fluctuations may adversely
affect the price of our common stock, regardless of our operating performance.
Where You Can Find More Information
We file annual, quarterly and special reports, proxy statements and
other information with the Securities and Exchange Commission. You may read and
copy any document we file with the Commission at the Commission's public
reference room at 450 Fifth Street, N.W., Washington, D.C. 20549. Please call
the Commission at 1-800-SEC-0330 for further information on the public reference
room. Our Commission filings are also available to the public at the
Commission's web site at http://www.sec.gov.
The Commission allows us to "incorporate by reference" the information
we file with them, which means that we can disclose important information to you
by referring you to those documents. The information incorporated by reference
is considered to be part of this prospectus, and information that we file later
with the Commission will automatically update and supersede this information. We
incorporate by reference the documents listed below and any future filings we
will make with the Commission under Sections 13(a), 13(c ), 14 or 15(d) of the
Securities Exchange Act prior to the termination of the offerings described in
this prospectus:
(a) Annual Report on Form 10-K for the fiscal year ended June 30, 1998 (SEC
file number 001-12143 and filing date of September 28, 1998);
(b) Quarterly Report on Form 10-Q, for the quarterly period ended September
30, 1998 (SEC file number 001-12143 and filing date of November 6,
1998);
(c) Quarterly Report on Form 10-Q, for the quarterly period ended December
31, 1998 (SEC file number 001-12143 and filing date of February 10,
1999);
(d) Quarterly Report on Form 10-Q for the quarterly period ended March 31,
1999 (SEC file number 001-12143 and filing date of May 7, 1999);
(e) Proxy Statement on Schedule 14A for the 1998 Annual Meeting (SEC file
number 001-12143 and filing date of September 28, 1998);
(f) Current Report on Form 8-K dated August 4, 1998 (SEC file number
001-12143 and filing date of August 5, 1998);
(g) Current Report on Form 8-K dated September 28, 1998 (SEC file number
001-12143 and filing date of September 29, 1998);
(h) Current Report on Form 8-K dated November 23, 1998 (SEC file number
001-12143 and filing date of November 24, 1998);
(i) Current Report on Form 8-K dated February 1, 1999 (SEC file number
001-12143 and filing date of February 11, 1999);
(j) Current Report on Form 8-K dated November 9, 1998 (SEC file number
001-12143 and filing date of February 17, 1999);
(k) Current Report on Form 8-K dated March 17, 1999 (SEC file number
001-12143 and filing date of March 26, 1999);
(l) Current Report on Form 8-K/A dated March 17, 1999 (SEC file number
001-12143 and filing date of April 21, 1999);
(m) Current Report on Form 8-K dated April 21, 1999 (SEC file number
001-12143 and filing date of April 21, 1999);
(n) Current Report on Form 8-K dated May 21, 1999 (SEC file number
001-12143 and filing date of May 27, 1999); and
(o) The descriptions of our capital stock, including preferred share
purchase rights, which are contained in registration statements on Form
8-A under the Exchange Act, including any amendments or reports filed
for the purpose of updating such descriptions.
You may request a copy of these filings, at no cost, by writing or
telephoning as follows:
America Online, Inc.
Attention: Investor Relations
22000 AOL Way
Dulles, VA 20166
(703) 265-2741
[email protected]
This prospectus is part of a registration statement on Form S-3 we
filed with the SEC under the Securities Act. You should rely only on the
information or representations provided in this prospectus. We have authorized
no one to provide you with different information. We are not making an offer of
these securities in any state where the offer is not permitted. You should not
assume that the information in this prospectus is accurate as of any date other
than the date on the front of the document.
Forward-Looking Statements
This prospectus and the documents incorporated by reference in this
prospectus contain forward-looking statements. These forward-looking statements
are based on our current expectations, estimates and projections about our
industry, management's beliefs and certain assumptions made by us. Words such as
"anticipates," "expects," "intends," "plans," "believes," "seeks," "estimates"
and variations of these words or similar expressions are intended to identify
forward-looking statements. These statements are not guarantees of future
performance and are subject to certain risks, uncertainties and assumptions that
are difficult to predict. Therefore, our actual results could differ materially
from those expressed or forecasted in any forward-looking statements as a result
of a variety of factors, including those set forth in "Risk Factors" above and
elsewhere in, or incorporated by reference into, this prospectus. We undertake
no obligation to update publicly any forward-looking statements for any reason,
even if new information becomes available or other events occur in the future.
Use Of Proceeds
Except as set forth in an accompanying prospectus supplement, we expect
to use the net proceeds from the sale of the securities for general corporate
purposes, which may include, among other things:
o working capital
o capital expenditures
o acquisitions
o the repayment of outstanding indebtedness
When we offer a particular series of offered securities, the prospectus
supplement relating to that offering will set forth the intended use of the net
proceeds received from that offering.
The Securities We May Offer
We may sell from time to time, in one or more offerings:
o our debt securities
o shares of our common stock
o shares of our preferred stock
o shares of our preferred stock represented by depositary shares
o warrants exercisable for our debt securities, common stock, preferred
stock or depositary shares
o stock purchase contracts to purchase common stock or preferred stock
The total dollar amount of all securities that we may issue will not
exceed $5,000,000,000. If we issue debt securities at a discount from their
original stated principal amount, then, for purposes of calculating the total
dollar amount of all securities issued under this prospectus, we will treat the
initial offering price of the debt securities as the total original principal
amount of the debt securities.
This prospectus may not be used to consummate a sale of securities
unless it is accompanied by a prospectus supplement.
The particular terms of the securities offered in any prospectus
supplement will be described in the applicable prospectus supplement. If
indicated in the prospectus supplement, the terms of any such securities may
differ from the terms summarized below. The prospectus supplement will also
contain information, where applicable, about material United States Federal
income tax considerations relating to the securities offered in that prospectus
supplement, and the securities exchange, if any, on which the securities will be
listed.
Description Of Debt Securities
Introduction
The debt securities we may issue will be in one or more distinct
series. The debt securities may include debentures, notes or other kinds of debt
obligations. The debt securities may be denominated in United States dollars or
in one or more foreign currencies or currency units.
The following description of the terms of the debt securities sets
forth general terms that we expect will apply to any series of the debt
securities. Most of the financial terms and other specific terms of any series
of debt securities that we offer will be described in a prospectus supplement to
be attached to this prospectus. Since the terms of specific debt securities may
differ from the general information that we have provided below, you should rely
on the information in the prospectus supplement instead of the information in
this prospectus if the information in the prospectus supplement is different
than the information below.
We will issue the debt securities under a contract called the
"Indenture" between us and a Trustee, who will be determined later. Unless we
tell you otherwise in the applicable prospectus supplement, the Indenture and
the debt securities will be governed by New York law. The terms of the debt
securities include those stated in the debt securities and the Indenture, those
provided for in any supplemental indenture with respect to the particular series
of debt securities, and those made part of the Indenture by reference to the
Trust Indenture Act of 1939. (Section 1.11 of the Indenture.) The form of the
Indenture is contained in the registration statement that we have filed with the
Commission. Supplemental indentures will also be filed with the Commission. See
"Where You Can Find More Information" on page 7 for information on how to obtain
a copy of the Indenture and any supplemental indenture from the Commission.
Unless we say otherwise, in an applicable prospectus supplement, the
debt securities will be unsecured obligations of America Online. In an
applicable prospectus supplement, we will set forth the seniority of the debt
securities relative to any of our other existing or future indebtedness. The
Indenture does not limit the total amount of debt securities that we can issue
under it, nor does it limit us from incurring or issuing other unsecured or
secured debt. The Indenture moreover does not contain any provisions that
protect you in the event we issue a large amount of debt or are acquired by
another entity.
Because this description is a summary, it does not describe every
aspect of the debt securities or the Indenture. This summary is subject to and
qualified in its entirety by reference to all the provisions of the Indenture
and of the debt securities. For example, in this description we use capitalized
words to signify defined terms that have been given special meaning in the
Indenture. We describe the meaning for only some of the more important terms. We
also include references in parentheses to certain sections of the Indenture.
Whenever we refer to particular sections or defined terms of the Indenture in
this prospectus or in any prospectus supplement, such sections or defined terms
are incorporated by reference here or in the prospectus supplement.
This description also is subject to and qualified by reference to the
description of the particular terms of any particular series of debt securities
described in a prospectus supplement.
Specific Terms Of Debt Securities
The prospectus supplement relating to a particular series of debt
securities will describe specific terms relating to each series of debt
securities then being offered. These terms will include some or all of the
following:
o the title and type of the debt securities
o any limit on the aggregate principal amount of the debt securities
o the date or dates on which the principal, if any, of such debt
securities will be payable, or the method of determining or extending
such date(s), and the amount or amounts or the method of determination
of such principal payments
o the date or dates from which any interest will accrue, or the method of
determining such date(s)
o any rate or rates, which may be fixed or variable, that such debt
securities will bear interest, or the method of determining or
resetting such rate or rates, and the interest payment dates, if any,
for such debt securities
o the place or places where any principal, premium or interest payments
may be made
o the terms of warrants, options or other rights to purchase or sell
securities issued by America Online in connection with or for the
purchase of debt securities
o any optional redemption provisions, including the period(s) within
which, the price(s) at which, the currency or currencies or currency
units in which, and the terms and conditions upon which, we may redeem
such debt securities, whether in whole or in part
o any provisions obligating us to repurchase or otherwise redeem such
debt securities pursuant to sinking fund provisions, upon the
occurrence of a specified event or at the Holder's option
o if other than $1,000 denominations for Registered Securities, or $5,000
denominations for Bearer Securities, the denominations in which such
debt securities are issuable
o if other than U.S. dollars, the currency or currencies or currency
units in which payment of the principal of and any premium or interest
on the debt securities will be payable, and the terms and conditions of
any elections that may be made available with respect thereto
o the terms and conditions, if any, pursuant to which the debt securities
are convertible into or exchangeable for common stock or other
securities
o any index, formula or other method to be used for determining the
amount of any payments of principal, premium of or interest on such
debt securities
o if the maturity of such debt securities is accelerated, the portion of
the principal amount that will be payable if other than the outstanding
principal amount, and the method of determining such amount
o the person to whom any interest on such debt securities will be payable
(if other than the registered Holder of such debt securities on the
applicable record date)
o the manner of determining the principal amount outstanding prior to
maturity if such amount is not otherwise determinable
o any provisions granting special rights to the Holders of such debt
securities
o any changes to or additional Events of Default or covenants
o any provisions for the payment of additional amounts on debt securities
held by non-U.S. persons in respect of taxes or similar charges
withheld or deducted, and for the optional redemption of such debt
securities in lieu of paying such additional amounts
o any provisions modifying the defeasance or covenant defeasance
provisions that apply to such debt securities
o whether the debt securities will be issued in fully registered form
without coupons or in bearer form, with or without coupons, or any
combination of these
o the terms, if any, of any guarantee of the payment of principal,
premium and interest with respect to the debt securities
o whether such debt securities will be issued in whole or in part in the
form of one or more temporary or permanent global securities, and, if
so, the identity of the depository for such global security or
securities
o if other than the Trustee, the identity of the Registrar and Paying
Agent
o the subordination, if any, of the debt securities
o the terms of any additional security for the debt securities
o if other than the laws of New York, the law governing such debt
securities and the extent to which such other law governs
o any other specific terms of the debt securities
(Section 3.1 of the Indenture.)
Unless we tell you otherwise in the applicable prospectus supplement,
debt securities will not be listed on any securities exchange.
Unless we tell you otherwise in the applicable prospectus supplement,
debt securities will be issued in fully registered form without coupons. If debt
securities of any series are issued in bearer form, the applicable prospectus
supplement will describe special restrictions and considerations, including
special offering restrictions and special federal income tax considerations,
applicable to such debt securities and to payments on and transfer and exchange
of such debt securities. Bearer debt securities generally will be transferable
by delivery. (Section 3.5 of the Indenture.) The Indenture refers to each Person
who is the bearer of a bearer Debt Security as the "Holder" of that Debt
Security. (Section 1.1 of the Indenture.)
If we issue debt securities at an "original issue discount", the
applicable prospectus supplement will describe special federal income tax and
other considerations applicable to such debt securities.
If the purchase price of any debt securities is payable in foreign
currencies or currency units, or if any debt securities are denominated in
foreign currencies or currency units, or if any debt securities are payable in
foreign currencies or currency units, the applicable prospectus supplement will
describe the special restrictions, elections, federal income tax considerations
and certain other important information with respect to such debt securities and
such foreign currencies or currency units.
The principal, premium, interest or other payments on debt securities
may be determined by reference to an index, formula or other method. Such an
index, formula or other method may be based, without limitation, on the price of
one or more commodities, derivatives or securities; one or more securities,
derivatives or commodities exchange indices or other indices; a foreign currency
or currencies; or any other variable or variables. If we issue debt securities
the payments on which are based on such an index, formula or other method, the
applicable prospectus supplement will describe that index, formula or other
method and special federal income tax and other considerations applicable to
such debt securities.
No debt security or coupon will be entitled to any benefits under the
Indenture or be valid or obligatory for any purpose until the debt security or
coupon is authenticated by the manual signature of one of the Trustee's
authorized signatories or an authenticating agent. No coupon will be valid until
the debt security to which it pertains has been authenticated. We may deliver
debt securities to the Trustee for authentication, together with a company order
for the authentication and delivery of the securities. The Trustee will then, in
accordance with the company order, authenticate and deliver the securities,
subject to special provisions for authentication of debt securities offered in a
periodic offering. If the form or terms of the debt securities of a series have
been established by board resolutions as permitted by the Indenture, when
authenticating the securities the Trustee will be entitled to receive, and
(subject to the Trust Indenture Act) shall be fully protected in relying upon an
opinion of counsel as to certain matters. The Trustee has the right to decline
to authenticate the securities if it receives an opinion of counsel reasonably
acceptable to us that states that the issue of the debt securities will
adversely affect the Trustee's own rights, duties, or immunities under the
Indenture or otherwise in a manner which is not reasonably acceptable to the
Trustee. If all of the debt securities of any series are not to be issued at one
time, the documents required to be delivered in connection with the
authentication of each debt security of the series, only need be delivered at or
prior to the authentication of the first debt security of the series.
Registered Securities
As noted above, unless we tell you in a prospectus supplement that the
specific debt securities described in that prospectus supplement are bearer debt
securities, the debt securities will be "registered securities". We and the
Trustee may treat the Person in whose name a registered Debt Security is
registered under the Indenture as the owner of that Debt Security for all
purposes, including for the purpose of receiving payments on that Debt Security.
(Section 3.8 of the Indenture.) The Indenture refers to each Person in whose
name a registered Debt Security is registered as the "Holder" of that Debt
Security. (Section 1.1 of the Indenture.)
Except as described below under "Global Debt Securities" or in the
applicable prospectus supplement, a Holder can exchange or transfer debt
securities in registered form at the office of the Trustee. Unless we tell you
otherwise in a prospectus supplement, the Trustee will act as our agent for
registering such debt securities in the names of Holders and transferring such
debt securities. We may appoint another entity at any time to perform this role
or we may perform it ourselves. The entity performing the role of maintaining
the list of registered Holders and performing transfers is called the
"Registrar". (Sections 3.5 and 9.2 of the Indenture.)
Unless we tell you otherwise in the applicable prospectus supplement, a
Holder seeking to transfer or exchange a registered Debt Security will not be
required to pay a service charge to us, the Registrar or the Trustee, but such
Holder may be required to pay any tax or other governmental charge associated
with the transfer or exchange. (Section 3.5 of the Indenture.)
If you are not the Holder of any debt securities in registered form,
your rights relating to those debt securities will be governed in part by
applicable laws and by the account rules and policies of the broker, bank or
financial intermediary through which you invest in such debt securities and any
other financial intermediary that holds interests directly or indirectly in such
debt securities (including any Depository referred to below under "Global Debt
Securities"). Neither we nor the Trustee has any responsibility for the account
rules, policies, actions or records of any broker, bank or other financial
intermediary through which you hold, directly or indirectly, your beneficial
interest in a Debt Security in registered form.
If you are not the holder of any debt securities in registered form,
you should consult the broker, bank or other financial intermediary through
which you invest in the debt securities for information on your rights in
respect of the debt securities. In particular, you should ask how you will
receive payments, and whether you will be able to provide instructions as to how
such broker, bank or other financial intermediary should exercise the rights of
a "Holder" under the Indenture.
Global Debt Securities
Registered Global Securities. We may specify in the applicable
prospectus supplement that the debt securities of a series will be issued in the
form of fully registered global securities, which we will refer to in this
prospectus as "Registered Global Securities". Registered Global Securities will
be registered in the name of a financial institution we select. This financial
institution, which will be the sole direct Holder of the Registered Global
Securities, is called the "Depository". We will identify any Depository in the
applicable prospectus supplement. Any person wishing to own a Debt Security
represented by a Registered Global Security must do so indirectly by virtue of
an account with a broker, bank or other financial intermediary that in turn has
an account with the Depository, or with another financial intermediary that
itself has an account with the Depository. The debt securities represented by
the Registered Global Securities may not be transferred to the name of any other
Holder unless the special circumstances described below occur.
Special Investor Considerations for Registered Global Securities. Our
obligations with respect to Registered Global Securities, as well as the
obligations of the Trustee and those of any third parties employed by us or the
Trustee, run only to Persons who are registered Holders of those debt
securities. For example, once a payment on a Registered Global Security is made
to the Depository, as sole Holder of that Registered Global Security, neither we
nor the Trustee has any further responsibility for that payment even if it is
not passed along to the correct owners of the beneficial interests in that
Registered Global Security.
As long as the debt securities are represented by Registered Global
Securities:
o You cannot have debt securities registered in your name under the
Indenture.
o You cannot receive physical certificates from us for your interest in
the debt securities.
o You must look to your own bank or broker or other financial
intermediary for payments on the debt securities.
o You will have no rights as a "Holder" under the Indenture. This means
that, among other things, you will have no right to give any direction,
approval or instruction directly to the Trustee under the Indenture.
o You may not be able to sell interests in the debt securities to some
insurance companies and other institutions that are required by law to
own their debt securities in the form of physical certificates.
o The Depository's policies will govern payments, transfers, exchanges
and other matters relating to the Registered Global Security. We and
the Trustee have no responsibility for any aspect of the Depository's
actions or for its records of ownership interests in the Registered
Global Security. We and the Trustee also do not supervise the
Depository in any way. In addition, we and the Trustee have no
responsibility for the actions or records of any broker, bank, or other
financial intermediary through which you hold, directly or indirectly,
your beneficial interest in the Registered Global Security.
o Payment for purchases and sales in the market of corporate debentures
and notes is generally made in next-day funds. In contrast, the
Depository will usually require that interests in a Registered Global
Security be purchased or sold within its system using same-day funds.
This difference could have some effect on how Registered Global
Security interests trade, but we do not know what that effect will be.
o You should consult the broker, bank or other financial intermediary
through which you invest in debt securities represented by Registered
Global Securities for information on your rights in respect of the debt
securities. In particular, you should ask how you will receive payments
and whether you will be able to provide instructions as to how the
Depository should exercise the rights of a "Holder" under the
Indenture.
Special Situations When Registered Global Security Will Be Terminated.
In the special situations described in the next paragraph, a Registered Global
Security will terminate and interests in it will be exchanged for physical
certificates representing debt securities. After that exchange, we believe that
you likely will be able to choose whether to hold debt securities directly in
your own name or indirectly through an account at a bank or broker or other
financial intermediary. However, when a Registered Global Security terminates,
the Depository (and not us or the Trustee) will be responsible for determining
the names of the institutions that will be the initial direct Holders of the
debt securities. You must consult your own bank or broker or other financial
intermediary at such time to find out how to have your interests in debt
securities transferred to your own name, if you wish to become a direct Holder.
The special situations for termination of a Registered Global Security
are:
o When the Depository notifies us that it is unwilling, unable or no
longer qualified to continue as Depository (unless a replacement
Depository is named)
o We determine in our sole discretion not to have any of the debt
securities of a series represented by a Registered Global Security and
notify the Trustee of our decision
(Section 3.5 of the Indenture.) In addition, a prospectus supplement
may list situations for terminating a Registered Global Security that would
apply only to the particular series of debt securities covered by that
prospectus supplement.
Bearer Global Securities. The debt securities of a series may also be
issued wholly or partially in the form of one or more bearer global securities
(a "Bearer Global Security") that will be deposited with a Depository, or with a
nominee for such Depository, identified in the applicable prospectus supplement.
Any such Bearer Global Securities may be issued in temporary or permanent form.
(Sections 3.4 and 3.5 of the Indenture.) The applicable prospectus supplement
will describe the specific terms and procedures, including the depository
arrangement, with respect to any portion of a series of debt securities to be
represented by Bearer Global Securities.
Payments
Unless we tell you otherwise in the applicable prospectus supplement,
we will generally deposit interest, principal and any other money due on the
debt securities, in the designated currency, with the Trustee, and the Trustee
will act as our agent for making payments on the debt securities. We may change
this appointment to another entity or perform this role ourselves. The entity
performing the role of making payments is called the "Paying Agent". We may, at
our option, make any interest payments on debt securities in registered form by
having the Trustee mail checks or make wire transfers to the registered Holders
listed in the Registrar's records. (Sections 3.7(a) and 9.2 of the Indenture.)
We may also make any payments required to be deposited with the Trustee by wire
transfer to an account designated by the Trustee on or before the date and time
such payments are due to be paid to the Holders. We may also make any payments
required to be deposited with the Trustee by wire transfer to an account
designated by the Trustee on or before the date and time such payments are due
to be paid to the Holders. If you are not the Holder of any debt securities in
registered form, you must make your own arrangements with the bank, broker or
other financial intermediary through which you invest in the debt securities to
receive payments.
Unless we tell you otherwise in the applicable prospectus supplement,
interest will be payable to each Holder listed in the Registrar's records at the
close of business on a particular day in advance of each due date for interest,
even if such Holder no longer owns the Debt Security on the interest due date.
That particular day is called the "Record Date" and will be stated in the
prospectus supplement. (Section 3.7(a) of the Indenture.) Persons buying and
selling debt securities between a Record Date and an interest payment date must
work out between them how to compensate for the fact that we will pay all the
interest for an interest period to the registered Holder on the Record Date.
Unless we tell you otherwise in the applicable prospectus supplement,
interest payable on any Debt Security in registered form that is not punctually
paid or duly provided for on any interest payment date will cease to be payable
to the Holder in whose name such Debt Security is registered on the relevant
Record Date. Such defaulted interest will instead be payable to the person in
whose name such Debt Security is registered on the special record date or other
specified date determined in accordance with the Indenture. (Section 3.7(b) of
the Indenture.)
We will make payments on debt securities in bearer form in the currency
and in the manner designated in the applicable prospectus supplement, subject to
any relevant laws and regulations, at such paying agencies outside the United
States as we may appoint from time to time. The Paying Agents outside the United
States initially appointed by us for a series of debt securities will be named
in the applicable prospectus supplement.
We may at any time designate additional Paying Agents or rescind the
designation of any Paying Agents, except that, if debt securities of a series
are issuable as Registered Securities, we will be required to maintain at least
one Paying Agent in each Place of Payment for such series and, if debt
securities of a series are issuable as Bearer Securities, we will be required to
maintain a Paying Agent in a Place of Payment outside the United States where
debt securities of such series and any related coupons may be presented and
surrendered for payment. (Section 9.2 of the Indenture.)
Notices
We and the Trustee will send notices regarding debt securities in
registered form only to registered Holders, using their addresses as listed in
the Registrar's records. If you are not the Holder of debt securities in
registered form, you should consult the broker, bank or other financial
intermediary through which you invest in such debt securities for information on
how you will receive such notices. Holders of Bearer debt securities will be
notified by publication as described in the prospectus supplement relating to
the debt securities. (Section 1.6 of the Indenture.)
Consolidation, Merger Or Sale
The Indenture generally permits us to consolidate or merge with or into
another company or entity and to sell or otherwise dispose of all or
substantially all of our assets. However, we may not take any of these actions
unless all the following conditions are met:
o where we merge out of existence or sell or otherwise dispose of our
assets, the surviving or acquiring firm must be a corporation, limited
liability company, partnership, trust or other Person organized and
existing under the laws of the United States of America or a State
thereof, and it must agree to be legally responsible for all of our
obligations under the debt securities and the Indenture
o the transaction must not cause a default on the debt securities and we
must not already be in default, where a "default" is an event that with
notice or passage of time, or both, would become an Event of Default as
provided in the Indenture
o we must deliver certificates and documents to the Trustee
The surviving or acquiring Person after any such transaction will be
substituted for America Online under the Indenture and the debt securities, and
all obligations of America Online will terminate. (Section 7.1 of the
Indenture.)
Events Of Default, Notice And Rights On Default
Unless we tell you otherwise in a prospectus supplement, the term
"Event of Default" means, with respect to debt securities of any series, any of
the following:
o We fail to pay interest on a Debt Security of that series within 30
days of its due date
o We fail to pay principal or any premium on a Debt Security of that
series, or we fail to deposit any mandatory sinking fund payment
o We remain in breach of a covenant in the Indenture for 90 days after we
receive a notice of default stating we are in breach. The notice must
be sent by either the Trustee or the Holders of at least 25% of the
principal amount of the debt securities of the affected series
o We file for bankruptcy or other events of bankruptcy, insolvency or
reorganization occur
o With respect to any particular series of debt securities, any other
"Event of Default" described in the applicable prospectus supplement
occurs
(Section 5.1 of the Indenture.) An Event of Default for a particular
series of debt securities will not necessarily constitute an Event of Default
for any other series of debt securities issued under the Indenture.
The Indenture requires the Trustee to notify Holders of the applicable
series of debt securities of any uncured Default within 90 days after such
Default occurs. The Trustee may withhold notice, however, of any Default, except
for a default in the payment of principal or interest, if it considers such
withholding of notice to be in the Holders' best interests. (Section 6.5 of the
Indenture.)
If an Event of Default has occurred and has not been cured, the Trustee
or the Holders of at least 25% in principal amount of the debt securities of the
affected series may declare the entire principal amount (or, if the debt
securities of that series are original issue discount debt securities or debt
securities payable in accordance with an index, formula or other method, such
portion of the principal amount or other amount specified in the prospectus
supplement) of all the debt securities of that series to be due and immediately
payable. (Section 5.2 of the Indenture.) The Holders of a majority in principal
amount of the debt securities of the affected series may waive, on behalf of the
Holders of all debt securities of such series, any past Event of Default with
respect to that series and its consequences, except an Event of Default in the
payment of the principal of or any premium or interest on any Debt Security and
specified other defaults. (Section 5.7 of the Indenture.)
The Holders of a majority in principal amount of the debt securities of
the affected series (with the debt securities of each such series voting as a
class) may direct the time, method and place of conducting any proceeding for
any remedy available to the Trustee for such series, or exercising any trust or
power conferred on such Trustee with respect to the debt securities of such
series, as long as such direction does not conflict with any law or the
Indenture and subject to other limitations. (Section 5.8 of the Indenture.)
Before a Holder can bypass the Trustee and bring its own lawsuit or
other formal legal action or take other steps to enforce its rights or protect
its interests relating to the debt securities, the following must occur:
o such Holder must give the Trustee written notice that an Event of
Default has occurred and remains uncured
o the Holders of at least 25% in principal amount of all debt securities
of the relevant series must request the Trustee in writing to take
action because of the Event of Default, and must offer an indemnity
satisfactory to the Trustee against the cost and other liabilities of
taking that action
o the Trustee must not have taken action for 60 days after receipt of the
above notice, request and offer of indemnity
o the Holders of a majority in principal amount of the debt securities of
that series must not have given the Trustee a direction inconsistent
with the above notice
(Section 5.9 of the Indenture.)
However, a Holder is entitled to bring a lawsuit at any time for the
payment of principal, premium, if any, and interest due on its debt securities
after the due date, subject to the provisions of the Indenture regarding payment
of interest and place and manner of payment on debt securities. (Section 5.10 of
the Indenture.)
If you are not the Holder of debt securities in registered form, you
should consult the broker, bank or financial intermediary through which you
invest in such debt securities for information on your rights in respect of
those debt securities following an Event of Default.
We will file annually with the Trustee a certificate as to America
Online's compliance with all conditions and covenants of the Indenture. (Section
9.7 of the Indenture.)
Modification Of The Indenture
There are three categories of changes we can make to the Indenture and
the debt securities.
Changes Requiring Approval of Each Affected Holder. First, there are
changes that cannot be made to debt securities of any series without the
approval of each Holder of debt securities of the series affected by such
change. Following is a summary of those changes:
o to change the time for payment of principal of or interest on a debt
security
o to reduce the amounts of principal of or interest on a debt security
o to reduce the amount of any premium payable upon the redemption of a
debt security
o to reduce the amount payable upon acceleration of the maturity of an
original issue discount debt security or a debt security payable in
accordance with an index, formula or other method
o to change the place or currency of payment on a debt security on or
after the stated maturity
o to impair the right to sue for payment on a debt security
o to reduce the percentage of Holders of debt securities of such series
whose consent is needed to modify or amend the Indenture or to waive
compliance with provisions of the Indenture or to waive defaults
o to change the obligation of America Online to maintain an office or
agency in the places and for the purposes specified in the Indenture
o to modify the provisions relating to waiver of defaults or
modifications of the Indenture and debt securities with certain
exceptions related to successor or multiple trustees
o to release any guarantors, if any, from their guarantees of the debt
securities or change any such guarantee in a manner adverse to Holders
o to modify the ranking or priority of the debt securities
(Section 8.2 of the Indenture.)
Changes Requiring a Majority Vote. The second category of change to the
Indenture and the debt securities is the kind that requires a vote in favor by
Holders of debt securities owning a majority of the principal amount of each
particular series adversely affected.
Changes Not Requiring Approval. The third category of change does not
require any vote by Holders of debt securities. Following is a summary of those
changes:
o to reflect that another corporation or entity has succeeded America
Online and assumed its covenants
o to add to America Online's covenants, to surrender any right or power
of America Online, or to comply with any Commission or other
requirements in connection with the qualification of the Indenture
o to add additional Events of Default with respect to any series
o to add or change any provisions to the extent necessary to facilitate
the issuance of debt securities in bearer form or in global form
o to change or eliminate any provision affecting debt securities not yet
issued
o to add guarantees or secure the debt securities
o to add provisions to permit or facilitate defeasance and covenant
defeasance and discharge so long as there is no adverse effect on
Holders of the applicable series of debt securities
o to establish the form or terms of debt securities
o to provide for the electronic delivery of supplemental indentures or
debt securities of any series
o to evidence and provide for successor or additional Trustees
o if allowed without penalty under applicable laws and regulations, to
permit payment in respect of debt securities in bearer form in the
United States
o to correct or supplement any inconsistent provisions or to cure any
ambiguity or correct any mistake
o to make any other provisions with respect to matters or questions
arising under the Indenture, as long as such action does not adversely
affect Holders of the debt securities in any material respect
(Section 8.1 of the Indenture.)
If you are not the Holder of debt securities in registered form, you
should consult with the broker, bank or other financial intermediary through
which you invest in such debt securities for information on how approval will be
granted or denied if we seek to change the Indenture or request a waiver of any
of its terms.
Defeasance
Unless we tell you otherwise in the applicable prospectus supplement,
the following discussion of full defeasance and covenant defeasance will apply
to each series of debt securities.
(Article IV of the Indenture.)
Full Defeasance. Under certain circumstances, we can legally release
ourselves from any payment or other obligations on the debt securities of any
series (called "full defeasance") if we put in place the following arrangements
for the Holders of those debt securities to be repaid:
o we must deposit in trust for the Holders' benefit a combination of
money and Government Obligations that will generate enough money to pay
when due the principal of and any premium or interest on the debt
securities of such series and to make any mandatory sinking fund
payments on such debt securities
o we must deliver to the Trustee a legal opinion of our counsel
confirming that there has been a change in federal tax law as in effect
on the date of this prospectus or an IRS ruling that lets us make the
above deposit without causing Holders to be taxed on the debt
securities of such series any differently than if we did not make the
deposit and simply repaid such debt securities ourselves
(Sections 4.4 and 4.6 of the Indenture.)
If we were to accomplish full defeasance, as described above, Holders
would have to rely solely on the trust deposit for repayment on the debt
securities of the particular series defeased.
Holders could not look to us for repayment if a shortfall occurred.
We may exercise its full defeasance option even if it has previously
exercised our covenant defeasance option. If we exercise our full defeasance
option, payment of the particular series of debt securities defeased may not be
accelerated because of an Event of Default. (Section 4.4 of the Indenture.)
Covenant Defeasance. Under certain circumstances, we can make the same
type of deposit described above and be released from some of the restrictive
covenants in the debt securities of any series. This is called "covenant
defeasance". In that event, Holders of those debt securities would lose the
protection of those restrictive covenants but would gain the protection of
having money and Government Obligations set aside in trust to repay such debt
securities. To achieve covenant defeasance, we must do the following:
o we must deposit in trust for the Holders' benefit a combination of
money and Government Obligations that will generate enough money to pay
when due the principal of and any premium or interest on the debt
securities of such series and to make any mandatory sinking fund
payments on such debt securities
o we must deliver to the Trustee a legal opinion of our counsel
confirming that, under federal tax law as in effect at the time of such
deposit, we may make such deposit without causing Holders to be taxed
on the debt securities of such series any differently than if we did
not make the deposit and simply repaid such debt securities ourselves
(Sections 4.5 and 4.6 of the Indenture.)
If we exercise our covenant defeasance option with respect to the debt
securities of a series, certain restrictive covenants of the Indenture and
certain Events of Default would no longer apply to such series. (Section 4.5 of
the Indenture.) If one of the remaining Events of Default occurred, however, and
payment of the debt securities of such series were accelerated, there could be a
shortfall between the amount in the trust deposit at that time and the amount
then due on such series. Holders could still look to us for payment of such debt
securities if there were such a shortfall. Depending on the event causing the
default (such as our bankruptcy), however, Holders may not be able to obtain
payment of the shortfall from us.
The Trustee
The Trustee under the Indenture will be set forth in any applicable
prospectus supplement. We will indicate in such prospectus any material
relationships we may have with the Trustee.
Description Of Common Stock
General
Our restated certificate of incorporation provides that we have
authority to issue 1,800,000,000 shares of common stock, par value $.01 per
share. As of May 25, 1999, there were 1,088,629,031 shares of common stock
outstanding. Common stockholders are entitled to one vote for each share held on
all matters submitted to a vote of stockholders. They do not have cumulative
voting rights. Stockholders casting a plurality of votes of the stockholders
entitled to vote in an election of directors may elect those directors standing
for election. Common stockholders are entitled to receive ratably such
dividends, if any, as may be declared by the board of directors out of funds
that are legally available to pay dividends. However, this dividend right is
subject to any preferential dividend rights of preferred stock that may be
issued at such future time or times. If America Online is dissolved, the holders
of common stock will be entitled to share ratably the net assets of America
Online available after we pay (i) all of our debts and other liabilities and
(ii) any amounts we may owe to the persons who hold our preferred stock, if any
is issued. Common stockholders do not have preemptive, subscription, redemption
or conversion rights. The outstanding shares of common stock are fully paid and
nonassessable. The rights, preferences and privileges of common stockholders are
subject to the rights of the shareholders of any series of preferred stock which
we may designate and issue in the future. We will describe the specific terms of
any common stock we may offer in a prospectus supplement.
Charter Provisions
Our restated certificate of incorporation and restated bylaws provide
for a classified board of directors. The board of directors currently consists
of ten members, classified into three classes. At each annual meeting of
stockholders, directors are elected for a full term of three years to succeed
those directors whose terms are expiring.
Our restated certificate of incorporation includes provisions
eliminating the personal liability of our directors for monetary damages
resulting from breaches of their fiduciary duty to the extent permitted by
Delaware law. Our restated certificate of incorporation and restated bylaws
include provisions indemnifying our directors and officers to the fullest extent
permitted by Delaware law, including under circumstances in which
indemnification is otherwise discretionary, and permitting the board of
directors to grant indemnification to employees and agents to the fullest extent
permitted by Delaware law.
Our restated bylaws require that nominations for the board of directors
made by the stockholders and proposals by stockholders seeking to have any
business conducted at a stockholders' meeting comply with particular notice
procedures. A notice by a stockholder of a planned nomination or of proposed
business must generally be given not later than 60 days nor earlier than 90 days
prior to the date of the meeting. A stockholder's notice of nomination must
include particular information about the stockholder, the nominee and any
beneficial owner on whose behalf the nomination is made, and a notice from a
stockholder proposing business to be brought before the meeting must describe
such business and include information about the stockholder making the proposal,
any beneficial owner on whose behalf the proposal is made, and any other
stockholder known to be supporting the proposal.
In addition, the restated certificate of incorporation contains a "fair
price" provision providing that certain "business combinations" with any
"interested stockholder" may not be consummated without an 80% stockholder vote.
The fair price provision defines an "interested stockholder" as any individual
or entity who is, or is an affiliate and during the prior two years was, the
beneficial owner of more than 15% of the voting stock of America Online. The
business combinations to which the fair price provision applies include:
o a merger or consolidation o the sale or other disposition of 10% or
more of America Online's assets o the issuance of stock having a value
in excess of 10% of the fair market value of our common stock
o any reclassification or recapitalization which increases the
proportionate share holdings of an interested stockholder
o the adoption of a plan of liquidation or dissolution proposed by or on
behalf of an interested stockholder
A significant purpose of the fair price provision is to deter a
purchaser from using two-tiered pricing and similar unfair or discriminatory
tactics in an attempt to acquire America Online. The affirmative vote of the
holders of 80% of the voting power of America Online is required to amend or
repeal the fair price provision or adopt any provision inconsistent with it.
Our restated certificate of incorporation and restated bylaws provide
that any action required or permitted to be taken by the stockholders shall be
taken only at a duly called annual or special meeting of the stockholders, or by
the unanimous written consent of all stockholders entitled to vote. Special
meetings may be called only by the board of directors or the chief executive
officer. In addition, the restated certificate of incorporation provides that
the board of directors may, from time to time, fix the number of directors
constituting the board of directors, and only the directors are permitted to
fill vacancies on the board of directors.
Under Delaware law, the affirmative vote of a majority of the shares
entitled to vote on any matter is required to amend a corporation's certificate
of incorporation or by-laws, unless a corporation's certificate of incorporation
or by-laws, as the case may be, requires a greater percentage. The affirmative
vote of the holders of at least 80% of the outstanding voting stock of America
Online is required to amend or repeal certain provisions of our restated
certificate of incorporation, and to reduce the number of authorized shares of
common stock and preferred stock. Such 80% vote is also required for
stockholders to amend or repeal our restated bylaws.
The provisions of the restated certificate of incorporation and
restated bylaws discussed above could make more difficult or discourage a proxy
contest or the acquisition of control by substantial block of our stock or the
removal of any incumbent member of the board of directors. Such provisions could
also have the effect of discouraging a third party from making a tender offer or
otherwise attempting to obtain control of America Online, even though such an
attempt might be beneficial to America Online and our stockholders.
Stockholder Rights Plan
We adopted a stockholder rights plan on May 12, 1998. The plan was
implemented by declaring a dividend, distributable to stockholders of record on
June 1, 1998, of one preferred share purchase right for each outstanding share
of common stock. The plan provides that each share of common stock outstanding
will have attached to it the right to purchase one one-thousandth of a share of
preferred stock. The purchase price per one one-thousandth of a preferred share
under the plan is $900, subject to adjustment. The rights will be exercisable
only if a person or group (i) acquires 15% or more of the common stock or (ii)
announces a tender offer that would result in that person or group acquiring 15%
or more of the common stock. Once exercisable, and in some circumstances if
certain additional conditions are met, the plan allows shareholders (other than
the acquiror) to purchase common stock or securities of the acquiror having a
then-current market value of two times the exercise price of the right. The
rights are redeemable for $.001 per right (subject to adjustment) at the option
of the board of directors. Until a right is exercised, the holder of the right,
as such, has no rights as a stockholder of America Online. The rights will
expire on May 12, 2008 unless redeemed by America Online prior to that date.
The rights agreement contains rights that have anti-takeover effects.
The rights will cause substantial dilution to a person or group that attempts to
acquire America Online on terms not approved by the board of directors. The
rights should not interfere with any merger or other business combination
approved by the board of directors since the rights may be redeemed by America
Online at $.001 per right prior to the earlier of (i) the time prior to such
time as any person has become an acquiring person (as defined in the rights
agreement), or (ii) May 12, 2008.
Change Of Control
We are subject to Section 203 of the Delaware General Corporation Law
which under certain circumstances, may make it more difficult for a person who
would be an "Interested Stockholder," as defined in Section 203, to effect
various business combinations with us for a three-year period. Under Delaware
law, a corporation's certificate of incorporation or bylaws may exclude a
corporation from the restrictions imposed by Section 203. Our certificate of
incorporation and bylaws do not exclude us from the restrictions imposed under
Section 203.
Description of Preferred Stock
General
Our board of directors is authorized by our restated certificate of
incorporation to provide, without further stockholder action, for the issuance
of up to 5,000,000 shares of our preferred stock, $.01 par value per share, in
one or more series. Our board of directors has the power to fix various terms
with respect to each series, including, among other things, voting powers,
dividend rights, liquidation preferences, redemption rights and conversion
privileges. As a result of its broad discretion with respect to the creation and
issuance of preferred stock without stockholder approval, the board of directors
could adversely affect the voting power of the holders of common stock. In
addition, although our board has no intention at the present time of doing so,
it could issue a series of Preferred Stock that could impede the completion of a
merger, tender offer or other takeover attempt. Our board will issue such a
series only if it determines that such an issuance is in the best interests of
America Online and its stockholders. In addition, the terms of a series of
preferred stock might discourage a potential acquirer from attempting to acquire
America Online.
As of May 25, 1999, there were no shares of preferred stock
outstanding. In May 1998, the board of directors designated 500,000 shares of
America Online's Preferred Stock as Series A-1 Junior Participating Preferred
Stock in connection with the establishment of a new stockholder rights plan.
You should refer to the prospectus supplement relating to the series of
preferred stock being offered for the specific terms of that series, including:
o the designation, number of shares and liquidation preference per share
o initial public offering price
o the dividend rate or rates
o the index, if any, upon which the amount of dividends, if any, is
determined
o the dates on which dividends, if any, will accrue and be payable and
the designated record dates for determining the holders entitled to
such dividends
o whether dividends will be cumulative or non-cumulative
o any auctioning and remarketing procedures
o any redemption or sinking fund provisions
o any conversion or exchange provisions
o provisions for issuance of global securities
o the securities exchange, if any, on which the preferred stock will be
listed
o the currency, which may be composite currency, in which payment of
dividends, if any, will be payable if other than U.S. dollars
o any voting rights
o any applicable discussion of federal income tax considerations
o the relative seniority with regard to any other class or series of
preferred stock
o any limitations on the issuance of any series of preferred stock
ranking senior to or on a parity with the series of preferred stock
being offered
o any additional terms, preferences, rights, limitations or restrictions
Upon receipt of the purchase price, the shares of preferred stock that
we issue will be fully paid and nonassessable. Unless otherwise specified in the
applicable prospectus supplement, the preferred stock will have no preemptive
rights to subscribe for any additional securities that we may issue.
The transfer agent, registrar, dividend disbursing agent and redemption
agent for each series of preferred stock will be specified in the applicable
prospectus supplement.
Dividends
The holders of each series of our preferred stock will be entitled to
receive, when, as and if declared by our board of directors, out of funds
legally available for that purpose, cumulative or non-cumulative cash or other
dividends. We will describe the rate or rates and payment dates applicable to
each series of preferred stock in the applicable prospectus supplement. Such
rates may be fixed or variable or both. If variable, we will describe the
formula used for determining the dividend rate for each dividend period in the
applicable prospectus supplement. We will pay dividends to the holders of record
as they appear on our stock books on the record dates set by our board of
directors and specified in the applicable prospectus supplement.
Unless otherwise indicated in the applicable prospectus supplement for
a series of preferred stock, no dividends may be declared or paid on other
series of preferred stock which have an equal or junior ranking, unless
dividends are also declared and paid on the offered series. If less than full
dividends can be declared and paid, the offered series of preferred stock will
be paid dividends ratably with other series of preferred stock that rank on a
parity as to receipt of dividends.
Redemption
The shares of any series of our preferred stock will be subject to
mandatory redemption or redemption at our option, under a sinking fund or
otherwise, in each case upon the terms, on the date or dates and at the
redemption price or prices set forth in the applicable prospectus supplement.
The applicable prospectus supplement will describe any restrictions on our
ability to repurchase or redeem shares if we have not paid any dividends on
shares of any series of preferred stock or any sinking fund installments when
due.
Liquidation Preference
Upon our liquidation, dissolution or winding up, the stockholders of
each series of our preferred stock will be entitled to receive, out of our
assets available for distribution to stockholders and before any distribution is
made to or set apart for the holders of common stock or shares of any junior
series, an amount described in the applicable prospectus supplement. If our
assets are insufficient to pay in full the amounts payable with respect to
shares of a series of preferred stock and any other series ranking on a parity
as to the distribution, the holders of shares of that series of preferred stock
and the other parity shares will share ratably in the distribution of our assets
in proportion to the full respective preferential amounts to which they are
entitled. After payment to the stockholders of that series of preferred stock of
the full preferential amounts to which they are entitled, those stockholders
will not be entitled to any further participation in any distribution of assets
by us, unless otherwise provided in the applicable prospectus supplement. Except
as otherwise provided in the applicable prospectus supplement, a consolidation
or merger between us and one or more entities is not, for this purpose, a
liquidation, dissolution or winding up.
Conversion
The terms and conditions, if any, on which shares of any series of
preferred stock are convertible into or exchangeable for debt securities, common
stock or cash will be set forth in the applicable prospectus supplement. These
terms may include provisions for conversion or exchange, either mandatorily, at
the option of the holder, or at our option. The terms may include the conversion
price or manner of calculating the conversion price, the conversion date(s) or
period(s), the events requiring an adjustment of the conversion price, and
provisions affecting conversion in the event of the redemption of the series of
preferred stock. Conversion terms may provide that the number of shares of
common stock or amount of cash to be received by the holders of preferred stock
would be calculated according to the market price of common stock as of a time
stated in the applicable prospectus supplement. Such exchange or conversion
rates may cap or limit the potential appreciation in value of an investment in a
series of preferred stock by reducing the amount of cash or common stock to be
received upon conversion of each share of preferred stock in the event that the
market price of the common stock exceeds a specified price. The exchange or
conversion rate may also place a floor on or limit the depreciation in value of
an investment in a series of preferred stock by increasing the amount of cash or
stock to be received upon conversion of each share of preferred stock in the
event that the market price of the common stock falls below a specified price.
Description of Depositary Shares
General
America Online may issue depositary receipts for depositary shares,
each of which will represent a fractional interest of a share of a particular
series of preferred stock, as specified in the applicable prospectus supplement.
Shares of preferred stock of each series represented by depositary shares will
be deposited under a separate Deposit Agreement among America Online and the
"depositary" named in the Deposit Agreement. Subject to the terms of the Deposit
Agreement, each owner of a depositary receipt will be entitled, in proportion to
the fractional interest of a share of a particular series of preferred stock
represented by the depositary shares evidenced by that depositary receipt, to
all the rights and preferences of the preferred stock represented by those
depositary shares, including dividend, voting, conversion, redemption and
liquidation rights.
The depositary shares will be evidenced by depositary receipts issued
pursuant to the applicable Deposit Agreement. Immediately following the issuance
and delivery of the preferred stock by America Online to the depositary, America
Online will cause the depositary to issue, on behalf of America Online, the
depositary receipts. Copies of the applicable form of Deposit Agreement and
depositary receipt may be obtained from America Online upon request, and the
statements made in this summary relating to the Deposit Agreement and the
depositary receipts to be issued under the Deposit Agreement are summaries of
provisions of the Deposit Agreement and the related depositary receipts. This
summary does not purport to be complete and is subject to, and is qualified in
its entirety by reference to, all of the provisions of the applicable Deposit
Agreement and related depositary receipts.
Dividends and Other Distributions
The depositary will distribute all cash dividends or other cash
distributions received in respect of the preferred stock to the record holders
of depositary receipts evidencing the related depositary shares in proportion to
the number of such depositary receipts owned by such holders, subject to the
obligations of holders to file proofs, certificates and other information and to
pay some charges and expenses to the depositary.
In the event of a distribution other than in cash, the depositary will
distribute property received by it to the record holders of depositary receipts
entitled to that property, subject to the obligations of holders to file proofs,
certificates and other information and to pay some charges and expenses to the
depositary, unless the depositary determines that it is not feasible to make the
distribution, in which case the depositary may, with the approval of America
Online, sell the property and distribute the net proceeds from the sale to the
holders.
No distribution will be made in respect of any depositary share to the
extent that it represents any preferred stock converted into other securities.
Withdrawal of Stock
Upon surrender of the depositary receipts at the corporate trust office
of the depositary, unless the related depositary shares have previously been
called for redemption or converted into other securities, the holders of those
depositary receipts will be entitled to delivery at the corporate trust office,
to or upon the holder's order, of the number of whole or fractional shares of
the preferred stock and any money or other property represented by the
depositary shares evidenced by the depositary receipts. Holders of depositary
receipts will be entitled to receive whole or fractional shares of the related
preferred stock on the basis of the proportion of preferred stock represented by
the depositary share as specified in the applicable prospectus supplement, but
holders of the shares of preferred stock will not thereafter be entitled to
receive depositary shares therefor. If the depositary receipts delivered by the
holder evidence a number of depositary shares in excess of the number of
depositary shares representing the number of shares of preferred stock to be
withdrawn, the depositary will deliver to the holder at the same time a new
depositary receipt evidencing the excess number of depositary shares.
Redemption of Depositary Shares
Whenever America Online redeems shares of preferred stock held by the
depositary, the depositary will redeem, as of the same redemption date, the
number of depositary shares representing shares of the preferred stock so
redeemed, provided America Online shall have paid in full to the depositary the
redemption price of the preferred stock to be redeemed plus an amount equal to
any accrued and unpaid dividends thereon to the date fixed for redemption. The
redemption price per depositary share will be equal to the corresponding
proportion of the redemption price and any other amounts per share payable with
respect to the preferred stock. If fewer than all the depositary shares are to
be redeemed, the depositary shares to be redeemed will be selected pro rata, as
nearly as may be practicable without creating fractional depositary shares, or
by any other equitable method determined by America Online.
From and after the date fixed for redemption, all dividends in respect
of the shares of preferred stock so called for redemption will cease to accrue,
the depositary shares so called for redemption will no longer be deemed to be
outstanding and all rights of the holders of the depositary receipts evidencing
the depositary shares so called for redemption will cease, except the right to
receive any moneys payable upon the redemption and any money or other property
to which the holders of the depositary receipts were entitled the redemption and
surrender thereof to the depositary.
Voting of the Preferred Stock
Upon receipt of notice of any meeting at which the holders of the
preferred stock are entitled to vote, the depositary will mail the information
contained in the notice of meeting to the record holders of the depositary
receipts evidencing the depositary shares which represent the preferred stock.
Each record holder of depositary receipts evidencing depositary shares on the
record date, which will be the same date as the record date for the preferred
stock, will be entitled to instruct the depositary as to the exercise of the
voting rights pertaining to the amount of preferred stock represented by the
holder's depositary shares. The depositary will vote the amount of preferred
stock represented by the depositary shares in accordance with the instructions,
and America Online will agree to take all reasonable action which may be deemed
necessary by the depositary in order to enable the depositary to do so. The
depositary will abstain from voting the amount of preferred stock represented by
the depositary shares to the extent it does not receive specific instructions
from the holders of depositary receipts evidencing the depositary shares. The
depositary shall not be responsible for any failure to carry out any instruction
to vote, or for the manner or effect of any such vote made, as long as such
action or non-action is in good faith and does not result from negligence or
willful misconduct of the depositary.
Liquidation Preference
In the event of the liquidation, dissolution or winding up of America
Online, whether voluntary or involuntary, the holders of each depositary receipt
will be entitled to the fraction of the liquidation preference accorded each
share of preferred stock represented by the depositary shares evidenced by such
depositary receipt, as set forth in the applicable prospectus supplement.
Conversion of Preferred Stock
The depositary shares, as such, are not convertible into common stock
or any other securities or property of America Online. Nevertheless, if so
specified in the applicable prospectus supplement relating to an offering of
depositary shares, the depositary receipts may be surrendered by their holders
to the depositary with written instructions to the depositary to instruct
America Online to cause conversion of the preferred stock represented by the
depositary shares evidenced by the depositary receipts into whole shares of
common stock, other shares of preferred stock of America Online or other shares
of stock, and America Online has agreed that upon receipt of those instructions
and any amounts payable in respect thereof, it will cause the conversion thereof
utilizing the same procedures as those provided for delivery of preferred stock
to effect such conversion. If the depositary shares evidenced by a depositary
receipt are to be converted in part only, a new depositary receipt or receipts
will be issued for any depositary shares not to be converted. No fractional
shares of common stock will be issued upon conversion, and if such conversion
would result in a fractional share being issued, an amount will be paid in cash
by America Online equal to the value of the fractional interest based upon the
closing price of the common stock on the last business day prior to the
conversion.
Amendment and Termination of the Deposit Agreement
The form of depositary receipt evidencing the depositary shares which
represent the preferred stock and any provision of the Deposit Agreement may at
any time be amended by agreement between America Online and the depositary.
However, any amendment that materially and adversely alters the rights of the
holders of depositary receipts or that would be materially and adversely
inconsistent with the rights granted to the holders of the related preferred
stock will not be effective unless such amendment has been approved by the
existing holders of at least 66% of the depositary shares evidenced by the
depositary receipts then outstanding. No amendment shall impair the right,
subject to certain exceptions in the Deposit Agreement, of any holder of
depositary receipts to surrender any depositary receipt with instructions to
deliver to the holder the related preferred stock and all money and other
property, if any, represented thereby, except in order to comply with law. Every
holder of an outstanding depositary receipt at the time any such amendment
becomes effective shall be deemed, by continuing to hold such receipt, to
consent and agree to such amendment and to be bound by the Deposit Agreement as
amended thereby.
The Deposit Agreement may be terminated by America Online upon not less
than 30 days prior written notice to the depositary if a majority of each series
of preferred stock affected by such termination consents to such termination,
whereupon the depositary shall deliver or make available to each holder of
Depositary Receipts, upon surrender of the depositary receipts held by such
holder, such number of whole or fractional shares of preferred stock as are
represented by the depositary shares evidenced by such depositary receipts
together with any other property held by the depositary with respect to such
depositary receipt. In addition, the Deposit Agreement will automatically
terminate if:
o all outstanding depositary shares shall have been redeemed
o there shall have been a final distribution in respect of the related
preferred stock in connection with any liquidation, dissolution or
winding up of America Online and such distribution shall have been
distributed to the holders of depositary receipts evidencing the
depositary shares representing such preferred stock or
o each share of the related preferred stock shall have been converted
into securities of America Online not so represented by depositary
shares.
Charges of Preferred Stock Depositary
America Online will pay all transfer and other taxes and governmental
charges arising solely from the existence of the Deposit Agreement. In addition,
America Online will pay the fees and expenses of the depositary in connection
with the performance of its duties under the Deposit Agreement. However, holders
of depositary receipts will pay the fees and expenses of the depositary for any
duties requested by such holders to be performed which are outside of those
expressly provided for in the Deposit Agreement.
Resignation and Removal of Depositary
The depositary may resign at any time by delivering to America Online
notice of its election to do so, and America Online may at any time remove the
depositary, any such resignation or removal to take effect upon the appointment
of a successor depositary. A successor depositary must be appointed within 60
days after delivery of the notice of resignation or removal and must be a bank
or trust company having its principal office in the United States and having a
combined capital and surplus of at least $50,000,000.
Miscellaneous
The depositary will forward to holders of depositary receipts any
reports and communications from America Online which are received by the
depositary with respect to the related preferred stock.
Neither the depositary nor America Online will be liable if it is
prevented from or delayed in, by law or any circumstances beyond its control,
performing its obligations under the Deposit Agreement. The obligations of
America Online and the depositary under the Deposit Agreement will be limited to
performing their duties thereunder in good faith and without negligence, in the
case of any action or inaction in the voting of preferred stock represented by
the depositary shares, gross negligence or willful misconduct, and America
Online and the depositary will not be obligated to prosecute or defend any legal
proceeding in respect of any depositary receipts, depositary shares or shares of
preferred stock represented thereby unless satisfactory indemnity is furnished.
America Online and the depositary may rely on written advice of counsel or
accountants, or information provided by persons presenting shares of preferred
stock represented thereby for deposit, holders of depositary receipts or other
persons believed in good faith to be competent to give such information, and on
documents believed in good faith to be genuine and signed by a proper party.
In the event the depositary shall receive conflicting claims, requests
or instructions from any holders of depositary receipts, on the one hand, and
America Online, on the other hand, the depositary shall be entitled to act on
such claims, requests or instructions received from America Online.
Description of Warrants
General
America Online may issue warrants to purchase its debt securities,
common stock, preferred stock, or depositary shares. America Online may issue
warrants independently or together with any offered securities and may be
attached to or separate from those offered securities. America Online will issue
the warrants under Warrant Agreements to be entered into between America Online
and a bank or trust company, as warrant agent, all as shall be set forth in the
applicable prospectus supplement. The warrant agent will act solely as an agent
of America Online in connection with the warrants of the series being offered
and will not assume any obligation or relationship of agency or trust for or
with any holders or beneficial owners of warrants.
The applicable prospectus supplement will describe the following terms,
where applicable, of warrants in respect of which this prospectus is being
delivered:
o the title of the warrants
o the designation, amount and terms of the securities for which the
warrants are exercisable
o the designation and terms of the other securities, if any, with which
the warrants are to be issued and the number of warrants issued with
each such security
o the price or prices at which the warrants will be issued
o the aggregate number of warrants
o any provisions for adjustment of the number or amount of securities
receivable upon exercise of the warrants or the exercise price of the
warrants
o the price or prices at which the securities purchasable upon exercise
of the warrants may be purchased
o if applicable, the date on and after which the warrants and the
securities purchasable upon exercise of the warrants will be separately
transferable
o if applicable, a discussion of the material United States federal
income tax considerations applicable to the exercise of the warrants
o any other terms of the warrants, including terms, procedures and
limitations relating to the exchange and exercise of the warrants
o the date on which the right to exercise the warrants shall commence,
and the date on which the right shall expire
o the maximum or minimum number of warrants which may be exercised at any
time
o information with respect to book-entry procedures, if any
Exercise of Warrants
Each warrant will entitle the holder of warrants to purchase for cash
the amount of debt securities, shares of preferred stock, shares of common stock
or depositary shares at the exercise price as shall in each case be set forth
in, or be determinable as set forth in, the prospectus supplement relating to
the warrants offered thereby. Warrants may be exercised at any time up to the
close of business on the expiration date set forth in the prospectus supplement
relating to the warrants offered thereby. After the close of business on the
expiration date, unexercised warrants will become void.
Warrants may be exercised as set forth in the prospectus supplement
relating to the warrants offered thereby. Upon receipt of payment and the
warrant certificate properly completed and duly executed at the corporate trust
office of the warrant agent or any other office indicated in the prospectus
supplement, America Online will, as soon as practicable, forward the debt
securities, shares of preferred stock, shares of common stock or depositary
shares purchasable upon such exercise. If less than all of the warrants
represented by the warrant certificate are exercised, a new warrant certificate
will be issued for the remaining warrants.
Description of Stock Purchase Contracts to Purchase Common Stock or
Preferred Stock
Unless otherwise specified in the applicable prospectus supplement,
America Online may issue stock purchase contracts, including contracts
obligating holders to purchase from America Online, and America Online to sell
to the holders, a specified number of shares of common stock or preferred stock
at a future date or dates. The consideration per share of common stock or
preferred stock may be fixed at the time the stock purchase contracts are issued
or may be determined by a specific reference to a formula set forth in the stock
purchase contracts. The stock purchase contracts may require holders to secure
their obligations thereunder in a specified manner.
The securities related to the stock purchase contracts will be pledged
to a collateral agent, for the benefit of America Online, pursuant to a pledge
agreement. The pledged securities will secure the obligations of holders of
stock purchase contracts to purchase common stock or preferred stock under the
related stock purchase contracts. The rights of holders of stock purchase
contracts to the related pledged securities will be subject to America Online's
security interest in those pledged securities. That security interest will be
created by the pledge agreement. No holder of stock purchase contracts will be
permitted to withdraw the pledged securities related to such stock purchase
contracts from the pledge arrangement except upon the termination or early
settlement of the related stock purchase contracts. Subject to that security
interest and the terms of the purchase contract agreement and the pledge
agreement, each holder of a stock purchase contract will retain full beneficial
ownership of the related pledged securities.
Except as described in the applicable prospectus supplement, the
collateral agent will, upon receipt of distributions on the pledged securities,
distribute such payments to America Online or a purchase contract agent, as
provided in the pledge agreement. The purchase contract agent will in turn
distribute payments it receives as provided in the stock purchase contract. The
applicable prospectus supplement will describe the terms of any stock purchase
contracts. The description in the prospectus supplement will not necessarily be
complete and will be qualified in its entirety by reference to the stock
purchase contracts, and, if applicable, collateral arrangements and depositary
arrangements, relating to such stock purchase contracts.
Plan Of Distribution
We may sell the securities:
o through underwriters or dealers
o directly to a limited number of purchasers or to a single purchaser
o through agents
The prospectus supplement with respect to the securities being offered
will set forth the terms of the offering of the offered securities, including
the name or names of any underwriters or agents, the purchase price of the
offered securities and net proceeds to America Online from such sale, any
underwriting discounts and other items constituting underwriters' compensation,
any initial public offering price and any discounts or concessions allowed or
reallowed or paid to dealers. Any initial public offering price and any
discounts or concessions allowed or reallowed or paid to dealers may be changed
from time to time.
If underwriters are used in the sale, the offered securities will be
acquired by the underwriters for their own account and may be resold from time
to time in one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the time of sale.
The offered securities may be offered to the public either through underwriting
syndicates represented by one or more managing underwriters or directly by one
or more underwriters. The underwriter or underwriters with respect to a
particular underwritten offering of securities, or, if an underwriting syndicate
is used, the managing underwriter or underwriters, will be set forth on the
cover of the applicable prospectus supplement. Unless otherwise set forth in the
prospectus supplement relating thereto, the obligations of the underwriters to
purchase the offered securities will be subject to conditions precedent and the
underwriters will be obligated to purchase all of the offered securities if any
are purchased.
If dealers are utilized in the sale of offered securities in respect of
which this prospectus is delivered, and if so specified in the applicable
prospectus supplement, we will sell such offered securities to the dealers as
principals. The dealers may then resell the offered securities to the public at
varying prices to be determined by such dealers at the time of resale. The names
of the dealers and the terms of the transaction will be set forth in the
applicable prospectus supplement.
The offered securities may be sold directly by America Online or
through agents designated by us from time to time. Any agent involved in the
offer or sale of the Offered Securities in respect to which this prospectus is
delivered will be named, and any commissions payable by America Online to such
agent will be set forth, in the prospectus supplement.
Underwriters, dealers and agents may be entitled under agreements
entered into with America Online to indemnification by America Online against
certain civil liabilities, including liabilities under the Securities Act, or to
contribution with respect to payments which the underwriters, dealers or agents
may be required to make in respect thereof. Underwriters, dealers and agents may
be customers of, may engage in transactions with, or perform services for,
America Online in the ordinary course of business.
Unless otherwise specified in the applicable prospectus supplement,
each class or series of offered securities will be a new issue with no
established trading market, other than the common stock, which is listed on the
New York Stock Exchange. We may elect to list any other class or series of
offered securities on any exchange, but we are not obligated to do so. It is
possible that one or more underwriters may make a market in a class or series of
offered securities, but the underwriters will not be obligated to do so and may
discontinue any market making at any time without notice. We cannot give any
assurance as to the liquidity of the trading market for any of the offered
securities.
Any underwriter may engage in over-allotment, stabilizing transactions,
short covering transactions and penalty bids in accordance with Regulation M
under the Exchange Act. Over-allotment involves sales in excess of the offering
size, which create a short position. Stabilizing transactions permit bids to
purchase the underlying security so long as the stabilizing bids do not exceed a
specified maximum. Short covering transactions involve purchases of the offered
securities in the open market after the distribution is completed to cover short
positions. Penalty bids permit the underwriters to reclaim a selling concession
from a dealer when the offered securities originally sold by the dealer are
purchased in a covering transaction to cover short positions. Those activities
may cause the price of the offered securities to be higher than it would
otherwise be. If commenced, the underwriters may discontinue any of the
activities at any time.
Legal Matters
The validity of the Securities offered hereby is being passed upon by
Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. The Vice Chairman of America
Online also serves as Of Counsel to Mintz, Levin and owns an aggregate of 800
shares of common stock and options to purchase 2,592,000 shares of common stock.
Experts
Ernst & Young LLP, independent auditors, have audited our consolidated
financial statements included in our Annual Report on Form 10-K for the year
ended June 30, 1998, and supplemented in our Current Reports on Form 8-K filed
on February 17, 1999 and on Form 8-K/A filed on April 21, 1999, as set forth in
their reports, which are incorporated by reference in this prospectus and
elsewhere in the registration statement. Our financial statements are
incorporated by reference in reliance on Ernst & Young LLP's reports, given on
their authority as experts in accounting and auditing.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following sets forth the expenses in connection with the issuance
and distribution of the securities being registered, other than underwriting
discounts and commissions. All such expenses shall be borne by America Online.
All amounts set forth below are estimates, other than the SEC registration fee.
SEC Registration Fee $1,257,185
Legal Fees and Expenses 45,000
Accounting Fees and Expenses 20,000
Trustee Fees 10,000
Rating Agency Fees 100,000
Miscellaneous 10,000
------
TOTAL $1,442,185
==========
Item 15. Indemnification of Officers and directors
Section 145(a) of the General Corporation Law of the State of Delaware
("Delaware Corporation Law") provides, in general, that a corporation shall have
the power to indemnify any person who was or is a party or is threatened to be
made a party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than an action
by or in the right of the corporation), because the person is or was a director
or officer of the corporation. Such indemnity may be against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by the person in connection with such action, suit or
proceeding, if the person acted in good faith and in a manner the person
reasonably believed to be in or not opposed to the best interests of the
corporation and if, with respect to any criminal action or proceeding, the
person did not have reasonable cause to believe the person's conduct was
unlawful.
Section 145(b) of the Delaware Corporation Law provides, in general,
that a corporation shall have the power to indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the corporation to procure a
judgment in its favor because the person is or was a director or officer of the
corporation, against any expenses (including attorneys' fees) actually and
reasonably incurred by the person in connection with the defense or settlement
of such action or suit if the person acted in good faith and in a manner the
person reasonably believed to be in or not opposed to the best interests of the
corporation.
Section 145(g) of the Delaware Corporation Law provides, in general,
that a corporation shall have the power to purchase and maintain insurance on
behalf of any person who is or was a director or officer of the corporation
against any liability asserted against the person in any such capacity, or
arising out of the person's status as such, whether or not the corporation would
have the power to indemnify the person against such liability under the
provisions of the law.
Article Ninth of the Registrant's Restated Certificate of Incorporation
(incorporated by reference herein) provides for indemnification of directors,
officers and other persons as follows:
To the fullest extent permitted by the Delaware General
Corporation Law as the same now exists or may hereafter be amended, the
Corporation shall indemnify, and advance expenses to, its directors and
officers and any person who is or was serving at the request of the
Corporation as a director or officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise. The
Corporation, by action of its board of directors, may provide
indemnification or advance expenses to employees and agents of the
Corporation or other persons only on such terms and conditions and to
the extent determined by the board of directors in its sole and
absolute discretion.
The indemnification and advancement of expenses provided by,
or granted pursuant to, this Article Ninth shall not be deemed
exclusive of any other rights to which those seeking indemnification or
advancement of expenses may be entitled under any by-law, agreement,
vote of stockholders or disinterested directors or otherwise, both as
to action in his official capacity and as to action in another capacity
while holding such office.
The Corporation shall have the power to purchase and maintain
insurance on behalf of any person who is or was a director, officer,
employee or agent of the Corporation, or is or was serving at the
request of the Corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other
enterprise, against any liability asserted against him and incurred by
him in any such capacity, or arising out of his status as such, whether
or not the Corporation would have the power to indemnify him against
such liability under this Article Ninth.
The indemnification and advancement of expenses provided by,
or granted pursuant to, this Article Ninth shall, unless otherwise
provided when authorized or ratified, continue as to a person who has
ceased to be a director or officer and shall inure to the benefit of
the heirs, executors and administrators of such officer or director.
The indemnification and advancement of expenses that may have been
provided to an employee or agent of the Corporation by action of the
board of directors, pursuant to the last sentence of Paragraph 1 of
this Article Ninth, shall, unless otherwise provided when authorized or
ratified, continue as to a person who has ceased to be an employee or
agent of the Corporation and shall inure to the benefit of the heirs,
executors and administrators of such a person, after the time such
person has ceased to be an employee or agent of the Corporation, only
on such terms and conditions and to the extent determined by the board
of directors in its sole discretion.
Article Five of the Registrant's Restated By-Laws (incorporated by
reference herein) provides that:
Right to Indemnification. Each person who was or is made a
party or is threatened to be made a party to or is otherwise involved
in any action, suit or proceeding, whether civil, criminal,
administrative or investigative, because he is or was a director or an
officer of the Corporation or is or was serving at the request of the
Corporation as a director, officer, employee or agent of another
corporation or of a partnership, joint venture, trust or other
enterprise, including service with respect to an employee benefit plan
(hereinafter an "Indemnitee"), whether the basis of such proceeding is
alleged action in an official capacity as a director, officer, employee
or agent or in any other capacity while serving as a director, officer,
employee or agent, shall be indemnified and held harmless by the
Corporation to the fullest extent authorized by the Delaware General
Corporation Law, as the same exists or may hereafter be amended (but,
in the case of any such amendment, only to the extent that such
amendment permits the Corporation to provide broader indemnification
rights than such law permitted the Corporation to provide before such
amendment), against all expense, liability and loss (including
attorney's fees, judgments, fines, ERISA excise taxes or penalties and
amounts paid in settlement) reasonably incurred or suffered by such
Indemnitee in connection therewith; provided, however, that, except as
provided in the section "Right of Indemnitees to Bring Suit" of this
Article with respect to proceedings to enforce rights to
indemnification, the Corporation shall indemnify any such Indemnitee in
connection with a proceeding (or part thereof) initiated by such
Indemnitee only if such proceeding (or part thereof) was authorized by
the board of directors of the Corporation.
Right to Advancement of Expenses. The right to indemnification
conferred in the section "Right to Indemnification" of this Article
shall include the right to be paid by the Corporation the expenses
(including attorney's fees) incurred in defending any such proceeding
in advance of its final disposition; provided, however, that, if the
Delaware General Corporation Law requires, an advancement of expenses
incurred by an Indemnitee in his capacity as a director or officer (and
not in any other capacity in which service was or is rendered by such
Indemnitee, including, without limitation, service to an employee
benefit plan) shall be made only upon delivery to the Corporation of an
undertaking, by or on behalf of such Indemnitee, to repay all amounts
so advanced if it shall ultimately be determined by final judicial
decision from which there is no further right to appeal that such
Indemnitee is not entitled to be indemnified for such expenses under
this section or otherwise. The rights to indemnification and to the
advancement of expenses conferred in this section and the section
"Right to Indemnification" of this Article shall be contract rights and
such rights shall continue as to an Indemnitee who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of
the Indemnitee's heirs, executors and administrators. Any repeal or
modification of any of the provisions of this Article shall not
adversely affect any right or protection of an Indemnitee existing at
the time of such repeal or modification.
Right of Indemnitees to Bring Suit. If a claim under the
section "Right to Indemnification" or "Right to Advancement of
Expenses" of this Article is not paid in full by the Corporation within
sixty (60) days after a written claim has been received by the
Corporation, except in the case of a claim for an advancement of
expenses, in which case the applicable period shall be twenty (20)
days, the Indemnitee may at any time thereafter bring suit against the
Corporation to recover the unpaid amount of the claim. If successful in
whole or in part in any such suit, or in a suit brought by the
Corporation to recover an advancement of expenses pursuant to the terms
of an undertaking, the Indemnitee shall also be entitled to be paid the
expenses of prosecuting or defending such suit. In (1) any suit brought
by the Indemnitee to enforce a right to indemnification hereunder (but
not in a suit brought by the Indemnitee to enforce a right to an
advancement of expenses) it shall be a defense that, and (2) in any
suit brought by the Corporation to recover an advancement of expenses
pursuant to the terms of an undertaking, the Corporation shall be
entitled to recover such expenses upon a final adjudication that, the
Indemnitee has not met any applicable standard for indemnification set
forth in the Delaware General Corporation Law. Neither the failure of
the Corporation (including its board of directors, independent legal
counsel, or its stockholders) to have made a determination prior to the
commencement of such suit that indemnification of the Indemnitee is
proper in the circumstances because the Indemnitee has met the
applicable standard of conduct set forth in the Delaware General
Corporation Law, nor an actual determination by the Corporation
(including its board of directors, independent legal counsel, or its
stockholders) that the Indemnitee has not met such applicable standard
of conduct, shall create a presumption that the Indemnitee has not met
the applicable standard of conduct or, in the case of such a suit
brought by the Indemnitee, be a defense to such suit. In any suit
brought by the Indemnitee to enforce a right to indemnification or to
an advancement of expenses hereunder, or brought by the Corporation to
recover an advancement of expenses pursuant to the terms of an
undertaking, the burden of proving that the Indemnitee is not entitled
to be indemnified, or to such advancement of expenses, under this
Article or otherwise shall be on the Corporation.
Non-Exclusivity of Rights. The rights to indemnification and
to the advancement of expenses conferred in this Article shall not be
exclusive of any other right which any person may have or hereafter
acquire under any statute, the Corporation's Certificate of
Incorporation as amended from time to time, these By-Laws, any
agreement, any vote of stockholders or disinterested directors or
otherwise.
Insurance. The Corporation may maintain insurance, at its
expense, to protect itself and any director, officer, employee or agent
of the Corporation or another corporation, partnership, joint venture,
trust or other enterprise against any expense, liability or loss,
whether or not the Corporation would have the power to indemnify such
person against such expense, liability or loss under the Delaware
General Corporation Law.
Indemnification of Employees and Agents of the Corporation.
The Corporation may, to the extent authorized from time to time by the
board of directors, grant rights to indemnification and to the
advancement of expenses to any employee or agent of the Corporation to
the fullest extent of the provisions of this Article with respect to
the indemnification and advancement of expenses of directors and
officers of the Corporation.
The directors and officers of the Registrant are covered by a policy of
liability insurance.
Item 16. Exhibits.
Exhibit No. Description
4.1 Article 4, Article 6 and Article 8 of the Restated Certificate of
Incorporation of America Online, Inc. (Filed as Exhibit 3.1 to
America Online's Annual report on Form 10-K for the fiscal Year
ended June 30, 1997 and incorporated herein by reference.)
4.2 Amendment of Section A of Article 4 of the Restated Certificate
of Incorporation of America Online, Inc. (Filed as Exhibit 4.1 to
America Online's Registration Statement on Form S-3, Registration
No. 333- 46633 and incorporated herein by reference.)
4.3 Restated By-Laws of America Online, Inc. (Filed as Exhibit 3.5 to
the Registrant's Annual Report on Form 10-K for the fiscal year
ended June 30, 1998 and incorporated herein by reference.)
4.4 Rights Agreement dated as of May 12, 1998, between America
Online, Inc. and BankBoston, N.A., as Rights Agent (Filed as
Exhibit 4.1 to the Registrant's Quarterly Report on Form 10-Q for
the quarter ended March 31, 1998 and incorporated herein by
reference.)
4.5 Form of Indenture between America Online and one or more trustees
to be named
4.6 Form of Debt Security (to be filed by amendment)
5.1 Opinion of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.,
regarding the legality of securities being offered
12.1 Computation of Ratio of Earnings to Fixed Charges
23.1 Consent of Ernst & Young LLP
23.2 Consent of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
(included in their opinion filed as Exhibit 5.1 and incorporated
herein by reference)
25.1 Form T-1, Statements of Eligibility and Qualification under the
Trust Indenture Act of 1939 of Trustee (to be filed by amendment)
Item 17. Undertakings.
A. Rule 415 Offering
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933.
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement.
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not
apply if the registration statement is on Form S-3 or Form
S-8, and the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed by the registrant pursuant to Section
13 or Section 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in the registration
statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
B. Filings Incorporating Subsequent Exchange Act Documents by Reference
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
C. Request for Acceleration of Effective Date
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
D. Registration Statement Permitted by Rule 430A
The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part of
this registration statement in reliance upon Rule 430A and contained in a form
of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of prospectus
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
E. Qualification of Trust Indentures Under the Trust Indenture Act of
1939 for Delayed Offerings.
The undersigned registrant hereby undertakes to file an application for
the purpose of determining the eligibility of the trustee to act under
subsection (a) of Section 310 of the Trust Indenture Act in accordance with the
rules and regulations prescribed by the Commission under Section 305(b)(2) of
the Act.
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has
duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the County of Loudoun, Commonwealth
of Virginia, on May 27, 1999.
AMERICA ONLINE, INC.
By: /s/J. Michael Kelly
J. Michael Kelly
Senior Vice President,
Chief Financial Officer, Treasurer and
Assistant Secretary
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each individual whose signature
appears below constitutes and appoints Stephen M. Case, Kenneth J. Novack, J.
Michael Kelly, Sheila A. Clark and James F. MacGuidwin and each of them, his
true and lawful attorneys-in-fact and agents with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective amendments)
to this registration statement (and any other registration statement for the
same offering that is to be effective upon filing pursuant to Rule 462(b) under
the Securities Act of 1933) and to file the same with all exhibits thereto, and
all documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done, as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents or any of them, or their or his substitute or
substitutes, may lawfully do or cause to be done by virtue hereof. This power of
attorney may be executed in counterparts.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated in one or more counter-parts.
<TABLE>
SIGNATURE TITLE DATE
<S> <C> <C>
/s/Stephen M. Case Chairman of the Board and Chief May 27, 1999
Stephen M. Case Executive Officer (principal executive
officer)
/s/Robert W. Pittman President, Chief Operating Officer and May 27, 1999
Robert W. Pittman Director
/s/J. Michael Kelly Senior Vice President, Chief Financial May 27, 1999
J. Michael Kelly Officer, Treasurer and Assistant Secretary
(principal financial officer)
/s/James F. MacGuidwin Vice President, Controller, Chief May 27, 1999
James F. MacGuidwin Accounting and Budget Officer (principal
accounting officer)
/s/Daniel F. Akerson Director May 27, 1999
Daniel F. Akerson
/s/James L. Barksdale Director May 27, 1999
James L. Barksdale
/s/Frank J. Caufield Director May 27, 1999
Frank J. Caufield
/s/Alexander M. Haig, Jr. Director May 27, 1999
Alexander M. Haig, Jr.
/s/William N. Melton Director May 27, 1999
William N. Melton
/s/Thomas Middelhoff Director May 27, 1999
Thomas Middelhoff
/s/Colin L. Powell Director May 27, 1999
Colin L. Powell
/s/Franklin D. Raines Director May 27, 1999
Franklin D. Raines
</TABLE>
EXHIBIT INDEX
Exhibit Description
No.
4.5 Form of Indenture between America Online, Inc. and one or more
trustees to be named
5.1 Opinion of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.,
regarding the legality of securities being offered
12.1 Computation of Ratio of Earnings to Fixed Charges
23.1 Consent of Ernst & Young LLP
23.2 Consent of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
(included in their opinion filed as Exhibit 5.1 hereto)
Exhibit 4.5
FORM OF INDENTURE
between
AMERICA ONLINE, INC.
and
-----------------------
TRUSTEE
Dated as of _________________
Providing for Issuance of
Debt Securities in Series
Reconciliation and tie between Indenture, dated as of ___________, and the Trust
Indenture Act of 1939, as amended.
Trust Indenture Act of 1939 Section Indenture Section
- ----------------------------------- -----------------
310 (a) (1) 6.11
(a) (2) 6.11
(a) (3) TIA
(a) (4) Not Applicable
(a) (5) TIA
(b) 6.9; 6.11; TIA
311 (a) TIA
(b) TIA
312 (a) 6.7
(b) TIA
(c) TIA
313 (a) 6.6; TIA
(b) TIA
(c) 6.6; TIA
(d) 6.6
314 (a) 9.6; 9.7; TIA
(b) Not Applicable
(c) (1) 1.2
(c) (2) 1.2
(c) (3) Not Applicable
(d) Not Applicable
(e) 1.2
(f) TIA
315 (a) TIA
(b) 6.5
(c) 6.1
(d) (1) TIA
(d) (2) TIA
(d) (3) TIA
(e) TIA
316 (a) (1) (A) 5.8
(a) (1) (B) 5.7
(b) 5.2; 5.10
(c) TIA
317 (a) (1) 5.3
(a) (2) 5.4
(b) 9.3
318 (a) 1.11
(b) TIA
(c) 1.11; TIA
iii
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION..........1
1.1. DEFINITIONS.........................................................1
1.2. COMPLIANCE CERTIFICATES AND OPINIONS................................8
1.3. FORM OF DOCUMENTS DELIVERED TO TRUSTEE..............................9
1.4. ACTS OF HOLDERS....................................................10
1.5. NOTICES, ETC., TO TRUSTEE AND COMPANY..............................12
1.6. NOTICE TO HOLDERS; WAIVER..........................................12
1.7. HEADINGS AND TABLE OF CONTENTS.....................................13
1.8. SUCCESSOR AND ASSIGNS..............................................13
1.9. SEPARABILITY.......................................................13
1.10. BENEFITS OF INDENTURE.............................................13
1.11. GOVERNING LAW.....................................................13
1.12. LEGAL HOLIDAYS....................................................14
1.13. NO RECOURSE AGAINST OTHERS........................................14
ARTICLE II SECURITY FORMS.................................................14
2.1. FORMS GENERALLY....................................................14
2.2. FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION....................15
2.3. SECURITIES IN GLOBAL FORM..........................................15
2.4. FORM OF LEGEND FOR SECURITIES IN GLOBAL FORM.......................16
ARTICLE III THE SECURITIES................................................16
3.1. AMOUNT UNLIMITED; ISSUABLE IN SERIES...............................16
3.2. DENOMINATIONS......................................................21
3.3. EXECUTION, AUTHENTICATION, DELIVERY AND DATING.....................21
3.4. TEMPORARY SECURITIES...............................................24
3.5. REGISTRATION, TRANSFER AND EXCHANGE................................25
3.6. REPLACEMENT SECURITIES.............................................28
3.7. PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED.....................29
3.8. PERSONS DEEMED OWNERS..............................................31
3.9. CANCELLATION.......................................................32
3.10. COMPUTATION OF INTEREST...........................................32
3.11. CURRENCY AND MANNER OF PAYMENT IN RESPECT OF SECURITIES...........32
3.12. APPOINTMENT AND RESIGNATION OF EXCHANGE RATE AGENT................37
3.13. WIRE TRANSFERS...................................................38
3.14. CUSIP NUMBERS.....................................................38
ARTICLE IV SATISFACTION, DISCHARGE AND DEFEASANCE.........................38
4.1. TERMINATION OF COMPANY'S OBLIGATIONS UNDER THE INDENTURE...........38
4.2. APPLICATION OF TRUST FUNDS.........................................40
4.3. APPLICABILITY OF DEFEASANCE PROVISIONS; COMPANY'S OPTION TO EFFECT
DEFEASANCE OR COVENANT DEFEASANCE......................... ........40
4.4. DEFEASANCE AND DISCHARGE...........................................40
4.5. COVENANT DEFEASANCE................................................41
4.6. CONDITIONS TO DEFEASANCE OR COVENANT DEFEASANCE....................41
4.7. DEPOSITED MONEY AND GOVERNMENT OBLIGATIONS TO BE HELD IN TRUST.....43
4.8. REPAYMENT TO COMPANY...............................................44
4.9. INDEMNITY FOR GOVERNMENT OBLIGATIONS...............................44
ARTICLE V DEFAULTS AND REMEDIES...........................................44
5.1. EVENTS OF DEFAULT..................................................44
5.2. ACCELERATION; RESCISSION AND ANNULMENT.............................45
5.3. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY TRUSTEE....46
5.4. TRUSTEE MAY FILE PROOFS OF CLAIM...................................46
5.5. TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF SECURITIES........46
5.6. DELAY OR OMISSION NOT WAIVER.......................................47
5.7. WAIVER OF PAST DEFAULTS............................................47
5.8. CONTROL BY MAJORITY................................................47
5.9. LIMITATION ON SUITS BY HOLDERS.....................................47
5.10. RIGHTS OF HOLDERS TO RECEIVE PAYMENT..............................48
5.11. APPLICATION OF MONEY COLLECTED....................................48
5.12. RESTORATION OF RIGHTS AND REMEDIES................................49
5.13. RIGHTS AND REMEDIES CUMULATIVE....................................50
5.14. WAIVER OF STAY, EXTENSION OR USURY LAWS...........................50
ARTICLE VI THE TRUSTEE....................................................50
6.1. RIGHTS OF TRUSTEE..................................................50
6.2. TRUSTEE MAY HOLD SECURITIES........................................51
6.3. MONEY HELD IN TRUST................................................51
6.4. TRUSTEE'S DISCLAIMER...............................................51
6.5. NOTICE OF DEFAULTS.................................................52
6.6. REPORTS BY TRUSTEE TO HOLDERS......................................52
6.7. SECURITY HOLDER LISTS..............................................52
6.8. COMPENSATION AND INDEMNITY.........................................53
6.9. REPLACEMENT OF TRUSTEE.............................................53
6.10. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR............................55
6.11. ELIGIBILITY; DISQUALIFICATION.....................................56
6.12. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.......56
6.13. APPOINTMENT OF AUTHENTICATING AGENT...............................57
ARTICLE VII CONSOLIDATION, MERGER OR SALE BY THE COMPANY..................58
7.1. CONSOLIDATION, MERGER OR SALE OF ASSETS PERMITTED..................58
ARTICLE VIII SUPPLEMENTAL INDENTURES......................................59
8.1. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS.................59
8.2. WITH CONSENT OF HOLDERS............................................60
8.3. COMPLIANCE WITH TRUST INDENTURE ACT................................62
8.4. EXECUTION OF SUPPLEMENTAL INDENTURES...............................62
8.5. EFFECT OF SUPPLEMENTAL INDENTURES..................................62
8.6. REFERENCE IN SECURITIES TO SUPPLEMENTAL INDENTURES.................62
ARTICLE IX COVENANTS......................................................62
9.1. PAYMENT OF PRINCIPAL, PREMIUM, IF ANY, AND INTEREST................63
9.2. MAINTENANCE OF OFFICE OR AGENCY....................................63
9.3. MONEY FOR SECURITIES TO BE HELD IN TRUST; UNCLAIMED MONEY..........64
9.4. CORPORATE EXISTENCE................................................65
9.5. MAINTENANCE OF PROPERTIES..........................................65
9.6. REPORTS BY THE COMPANY.............................................66
9.7. ANNUAL REVIEW CERTIFICATE..........................................66
PAYMENT OF TAXES AND OTHER CLAIMS.......................................66
ARTICLE X REDEMPTION......................................................67
10.1. APPLICABILITY OF ARTICLE..........................................67
10.2. ELECTION TO REDEEM; NOTICE TO TRUSTEE.............................67
10.3. SELECTION OF SECURITIES TO BE REDEEMED............................67
10.4. NOTICE OF REDEMPTION..............................................68
10.5. DEPOSIT OF REDEMPTION PRICE.......................................69
10.6. SECURITIES PAYABLE ON REDEMPTION DATE.............................70
10.7. SECURITIES REDEEMED IN PART.......................................71
ARTICLE XI SINKING FUNDS..................................................71
11.1. APPLICABILITY OF ARTICLE..........................................71
11.2. SATISFACTION OF SINKING FUND PAYMENTS WITH SECURITIES.............71
11.3. REDEMPTION OF SECURITIES FOR SINKING FUND.........................71
INDENTURE, dated as of ______________, between AMERICA ONLINE, INC., a
corporation duly organized and existing under the laws of the State of Delaware
(the "Company"), and __________, Trustee, a national banking association
organized and existing under the laws of the United States of America (the
"Trustee").
RECITALS
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its debentures, notes
or other evidences of indebtedness ("Securities") to be issued in one or more
series as herein provided.
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually covenanted and agreed as
follows for the equal and ratable benefit of the Holders of the Securities or of
series thereof:
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
Section 1.1. Definitions. (a) For all purposes of this Indenture,
except as otherwise expressly provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural
as well as the singular;
(2) all other terms used herein which are defined in the
Trust Indenture Act, either directly or by reference
therein, have the meanings assigned to them therein;
(3) all accounting terms not otherwise defined herein have
the meanings assigned to them in accordance with
generally accepted accounting principles; and
(4) the words "herein", "hereof" and "hereunder" and other
words of similar import refer to this Indenture as a
whole and not to any particular Article, Section or
t other subdivision.
"Affiliate" of any specified Person means any Person directly or
indirectly controlling or controlled by, or under direct or indirect common
control with, such specified Person. For 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.
"Agent" means any Paying Agent or Registrar.
"Authenticating Agent" means any authenticating agent appointed by the
Trustee pursuant to Section 6.13.
"Authorized Newspaper" means a newspaper of general circulation, in the
official language of the country of publication or in the English language,
customarily published on each Business Day whether or not published on
Saturdays, Sundays or holiday. Whenever successive publications in an Authorized
Newspaper are required hereunder they may be made (unless otherwise expressly
provided herein) on the same or different days of the week and in the same or
different Authorized Newspapers.
"Bearer Security" means any Security issued hereunder which is payable
to bearer.
"Board" or "Board of Directors" means the Board of Directors of the
Company, the Executive Committee or any other duly authorized committee thereof.
"Board Resolution" means a copy of one or more resolutions of the Board
of Directors, certified by the Corporate 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 the certificate, and delivered to the
Trustee.
"Business Day", when used with respect to any Place of Payment or any
other particular location referred to in this Indenture or in the Securities,
means, unless otherwise specified with respect to any Securities pursuant to
Section 3.1, each Monday, Tuesday, Wednesday, Thursday and Friday which is not a
day on which banking institutions in that Place of Payment or particular
location are authorized or obligated by law or executive order to close, except
as may otherwise be provided in the form of Security of any particular series
pursuant to the provisions of this Indenture.
"Commission" means the Securities and Exchange Commission, as from time
to time constituted, created under the Securities Exchange Act of 1934, or, if
at any time after the execution of this Indenture such Commission is not
existing and performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties at such time.
"Company" means the party named as the Company in the first paragraph
of this Indenture until a successor shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter means such successors.
"Company Order" and "Company Request" mean, respectively, a written
order or request signed in the name of the Company by the Chairman of the Board,
any Vice Chairman of the Board, the President, any Vice President or any Senior
Vice President, and by the Treasurer, any Assistant Treasurer, the Corporate
Secretary or any Assistant Secretary of the Company and delivered to the
Trustee.
"Corporate Trust Office" means the office of the Trustee in New York,
New York at which at any particular time its corporate trust business shall be
principally administered, which office at the date hereof is located at
____________________________________ Attention: _____________________________.
"CurrencyUunit", for all purposes of this Indenture, shall include any
composite currency.
"Default" means any event which is, or after notice or passage of time,
or both, would be, an Event of Default.
"Depository", when used with respect to the Securities of or within any
series issuable or issued in whole or in part in global form, means the Person
designated as Depository by the Company pursuant to Section 3.1 until a
successor Depository shall have become such pursuant to the applicable
provisions of this Indenture, and thereafter shall mean or include each Person
which is then a Depository hereunder, and if at any time there is more than one
such Person, shall be a collective reference to such Persons.
"Dollar" or "$" means the coin or currency of the United States as at
the time of payment is legal tender for the payment of public and private debts.
"Government Obligations" means securities which are (i) direct
obligations of the United States or, if specified as contemplated by Section
3.1, the government which issued the currency in which the Securities of a
particular series are payable, for the payment of which its full faith and
credit is pledged or (ii) obligations of a Person controlled or supervised by
and acting as an agency or instrumentality of the United States or, if specified
as contemplated by Section 3.1, such government which issued the foreign
currency in which the Securities of such series are payable, for the payment of
which the full faith and credit of the United States or such other government is
pledged (whether by guaranty or otherwise), which, in either case, are not
callable or redeemable at the option of the issuer thereof, and shall also
include a depository receipt issued by a bank or trust company as custodian with
respect to any such Government Obligation or a specific payment of interest on
or principal of any such Government Obligation held by such custodian for the
account of the holder of a depository receipt, provided that (except as required
by law) such custodian is not authorized to make any deduction from the amount
payable to the holder of such depository receipt from any amount received by the
custodian in respect of the Government Obligation evidenced by such depository
receipt.
"Holder" means, with respect to a Bearer Security, a bearer thereof or
of a coupon appertaining thereto and, with respect to a Registered Security, a
person in whose name such Registered Security is registered on the Register.
"Indenture" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively. The term "Indenture" shall also include the terms of the
particular series of Securities established as contemplated by Section 3.1;
provided, however, that if at any time more than one Person is acting as Trustee
under this Indenture due to the appointment of one or more separate Trustees for
any one or more separate series of Securities, "Indenture" shall mean, with
respect to such series of Securities for which any such Person is Trustee, this
instrument as originally executed or as it may from time to time be supplemented
or amended by one or more indentures supplemental hereto entered into pursuant
to the applicable provisions hereof and shall include the terms of particular
series of Securities for which such Person is Trustee established as
contemplated by Section 3.1, exclusive, however, of any provisions or terms
which relate solely to other series of Securities for which such Person is not
Trustee, regardless of when such terms or provisions were adopted, and exclusive
of any provisions or terms adopted by means of one or more indentures
supplemental hereto executed and delivered after such Person had become such
Trustee, but to which such Person, as such Trustee, was not a party; provided
further that in the event that this indenture is supplemented or amended by one
or more indentures supplemental hereto which are only applicable to certain
series of Securities, the term "Indenture" for a particular series of Securities
shall only include the supplemental indentures applicable thereto.
"Indexed Security" means a Security the terms of which provide that the
principal amount thereof payable at Stated Maturity may be more or less than the
principal face amount thereof at original issuance.
"Interest", when used with respect to an Original Issue Discount
Security which by its terms bears interest only after Maturity, means interest
payable after Maturity.
"Interest Payment Date", when used with respect to any Security, means
the Stated Maturity of an installment of interest on such Security.
"Maturity", when used with respect to any Security, means the date on
which the principal of such Security or an installment of principal becomes due
and payable as therein or herein provided, whether at the Stated Maturity or by
declaration of acceleration, call for redemption or otherwise.
"Officer" means the Chairman of the Board of Directors, the President,
any Executive Vice President, any Senior Vice President, any Vice President, the
Treasurer or the Corporate Secretary of the Company.
"Officers' Certificate" means a certificate signed by the Chairman of
the Board, the President, any Executive Vice President or any Senior Vice
President, signing alone, or by any Vice President signing together with the
Corporate Secretary, any Assistant Secretary, the Treasurer, or any Assistant
Treasurer of the Company.
"Opinion of Counsel" means a written opinion of legal counsel, who may
be (a) any senior attorney employed by the Company, (b) Mintz, Levin, Cohn,
Ferris, Glovsky and Popeo, P.C. or (c) other counsel designated by the Company
and who shall be reasonably acceptable to the Trustee.
"Original Issue Discount Security" means any Security which provides
for an amount less than the stated principal amount thereof to be due and
payable upon declaration of acceleration of the Maturity thereof pursuant to
Section 5.2.
"Outstanding", when used with respect to Securities, means, as of the
date of determination, all Securities theretofore authenticated and delivered
under this Indenture, except:
(i) Securities theretofore cancelled by the Trustee or
delivered to the Trustee for cancellation;
(ii) Securities, or portions thereof, for whose payment or
redemption money or Government Obligations in the
necessary amount has been theretofore deposited with
the Trustee or any Paying Agent (other than the
Company) in trust or set aside and segregated in trust
by the Company (if the Company shall act as its own
Paying Agent) for the Holders of such Securities and
any coupons appertaining thereto, provided that, if
such Securities are to be redeemed, notice of such
redemption has been duly given pursuant to this
Indenture or provisions therefor satisfactory to the
Trustee have been made;
(iii)Securities, except to the extent provided in Sections
4.4 and 4.5, with respect to which the Company has
effected defeasance and/or covenant defeasance as
provided in Article IV; and
(iv) 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 unless otherwise provided with respect to any Securities
of any series pursuant to Section 3.1, in determining whether the Holders of the
requisite principal amount of the Outstanding Securities have given any request,
demand, authorization, direction, notice, consent or waiver hereunder, or
whether sufficient funds are available for redemption or for any other purpose,
and for the purpose of making the calculations required by section 313 of the
Trust Indenture Act or are present at a meeting of Holders for quorum purposes,
(w) the principal amount of any Original Issue Discount Securities that may be
counted in making such determination or calculation and that shall be deemed to
be Outstanding for such purpose shall be equal to the amount of principal
thereof that would be (or shall have been declared to be) due and payable, at
the time of such determination, upon a declaration of acceleration of the
maturity thereof pursuant to Section 5.2, (x) the principal amount of any
Security denominated in one or more Foreign Currencies or currency units that
may be counted in making such determination or calculation and that shall be
deemed Outstanding for such purpose shall be equal to the Dollar equivalent,
determined as of the date such Security is originally issued by the Company as
set forth in an Exchange Rate Officer's Certificate delivered to the Trustee, of
the principal amount (or, in the case of an Original Issue Discount Security,
the Dollar equivalent, determined as of such date of original issuance, of the
amount determined as provided in clause (w) above) of such Security, (y) unless
otherwise provided with respect to such Security pursuant to Section 3.1, the
principal amount of any Indexed Security that may be counted in making such
determination or calculation and that shall be deemed Outstanding for such
purpose shall be equal to the principal face amount of such Indexed Security at
original issuance, and (z) Securities owned by the Company or any other obligor
upon the Securities or any Affiliate of the Company or of such other obligor
shall be disregarded and deemed not to be Outstanding, except that, in
determining whether the Trustee shall be protected in making such calculation or
in relying upon any such request, demand, authorization, direction, notice,
consent or waiver, or determination as to the presence of a quorum, 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 of such other obligor.
"Paying Agent" means any Person authorized by the Company to pay the
principal of, premium, if any, or interest and any other payments on any
Securities on behalf of the Company.
"Periodic Offering" means an offering of Securities of a series from
time to time the specific terms of which Securities, including, without
limitation, the rate or rates of interest or formula for determining the rate or
rates of interest thereon, if any, the Maturity thereof and the redemption
provisions, if any, with respect thereto, are to be determined by the Company
upon the issuance of such Securities.
"Person" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof or any other entity.
"Place of Payment", when used with respect to the Securities of or
within any series, means the place or places where the principal of, premium, if
any, and interest and any other payments on such Securities are payable as
specified as contemplated by Sections 3.1 and 9.2.
"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.
"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, in whole or in part, means the price at which it is to be redeemed
pursuant to this Indenture.
"Registered Security" means any Security issued hereunder and
registered as to principal and interest in the Register.
"Regular Record Date" for the interest payable on any Interest Payment
Date on the Securities of or within any series means the date specified for that
purpose as contemplated by Section 3.1, which date shall be, unless otherwise
specified pursuant to Section 3.1, the fifteenth day preceding such Interest
Payment Date, whether or not such day shall be a Business Day.
"Responsible Officer", when used with respect to the Trustee, shall
mean the chairman or any vice chairman of the board of directors, the chairman
or any vice-chairman of the executive committee of the board of directors, the
chairman of the trust committee, the president, any senior vice president, any
vice president, any assistant vice president, the secretary, any assistant
secretary, any associate, the treasurer, any assistant treasurer, the cashier,
any assistant cashier, any senior trust officer, any trust officer, the
controller, any assistant controller, or any officer of the Trustee customarily
performing functions similar to those performed by the persons who at the time
shall be such officers, respectively, or to whom any corporate trust matter is
referred because of his knowledge of and familiarity with a particular subject.
"Security" or "Securities" has the meaning stated in the first recital
of this Indenture and more particularly means a Security or Securities of the
Company issued, authenticated and delivered under this Indenture.
"Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 3.7.
"Stated Maturity", when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date specified
in such Security or in a coupon representing such installment of interest as the
fixed date on which the principal of such Security or such installment of
principal or interest is due and payable.
"Subsidiary" means any Person of which the Company at the time owns or
controls, directly or indirectly, more than 50% of the shares of outstanding
stock or other equity interests having general voting power under ordinary
circumstances to elect a majority of the Board of Directors, managers or
trustees, as the case may be, of such Person (irrespective of whether or not at
the time stock of any other class or classes or other equity interests of such
corporation shall have or might have voting power by reason of the happening of
any contingency).
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in
effect on the date of this Indenture, except as provided in Section 8.3.
"Trustee" means the party named as such in the first paragraph of this
Indenture until a successor Trustee replaces it pursuant to the applicable
provisions of this Indenture, and thereafter means such successor Trustee and
if, at any time, there is more than one Trustee, "Trustee" as used with respect
to the Securities of any series shall mean the Trustee with respect to the
Securities of that series.
"United States" means, unless otherwise specified with respect to the
Securities of any series as contemplated by Section 3.1, the United States of
America (including the States and the District of Columbia), its territories,
its possessions and other areas subject to its jurisdiction.
"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".
"U.S. Person" means, unless otherwise specified with respect to the
Securities of any series as contemplated by Section 3.1, an individual citizen
or resident of the United States, a corporation created or organized in or under
the laws of the United States, any State thereof or the District of Columbia, or
a partnership, estate or trust treated as a domestic partnership, estate or
trust for United States federal income tax purposes.
(b) The following terms shall have the meanings specified in
the Sections referred to opposite such term below:
Term Section
"Act" 1.4(a)
"Bankruptcy Law" 5.1
"Claims" 6.8(b)
"Component Currency" 3.11(h)
"Conversion Date" 3.11(d)
"Conversion Event" 3.11(h)
"Custodian" 5.1
"Defaulted Interest" 3.7(b)
"Election Date" 3.11(h)
"Euro" 3.11(h)
"Event of Default" 5.1
"Exchange Rate Agent" 3.11(h)
"Exchange Rate Officer's
Certificate" 3.11(h)
"Foreign Currency" 3.11(h)
"Market Exchange Rate" 3.11(h)
"Register" 3.5
"Registrar" 3.5
"Specified Amount" 3.11(h)
"Valuation Date" 3.11(c)
Section 1.2. Compliance Certificates and Opinions. Upon any application
or request by the Company to the Trustee to take any action under any provision
of this Indenture, the Company shall furnish to the Trustee such certificates
and opinions as may be required under the Trust Indenture Act. Each such
certificate or opinion shall be given in the form of an Officer's Certificate,
if to be given by an officer of the Company, or an Opinion of counsel, if to be
given by counsel, and shall comply with the requirements of the Trust Indenture
Act and any other requirements set forth in this Indenture. In the case of any
application or request as to which the furnishing of such documents is
specifically required by any provision of this Indenture relating to such
particular application or request, no additional certificate or opinion need be
furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than pursuant to
Sections 2.3 and 9.7) shall include:
(1) a statement that each individual signing such
certificate or opinion has read such condition or
covenant and the definitions herein relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements
or opinions contained in such certificate or opinion
are based;
(3) a statement that, in the opinion of each such
individual, he has made such examination or
investigation as is necessary to enable him to express
an informed opinion as to whether or not such condition
or covenant 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 Trustee. In any case where
several matters are required to be certified by, or covered by an opinion of,
any specified Person, it is not necessary that all such matters be certified by,
or covered by the opinion of, only one such Person, or that they be so certified
or covered by only one document, but one such Person may certify or give an
opinion with respect to some matters and one or more other such Persons as to
other matters, and any such Person may certify or give an opinion as to such
matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations as to such matters are
erroneous.
Any certificate or opinion of an officer of the Company or of counsel
may be based, insofar as it relates to accounting matters, upon a certificate or
opinion of or representations by an accountant or firm of accountants in the
employ of the Company, unless such officer or counsel, as the case may be,
knows, or in the exercise of reasonable care should know, that the certificate
or opinions or representations as to such accounting 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. (a) Any request, demand, authorization,
direction, notice, consent, waiver or other action provided by this Indenture to
be given or taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person or
by agent duly appointed in writing; and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
are delivered to the Trustee and, where it is hereby expressly required, to the
Company. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "Act" of the Holders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Indenture and conclusive in favor of the Trustee and the
Company, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee deems sufficient.
(c) The ownership of Bearer Securities may be proved by the
production of such Bearer Securities or by a certificate executed by any trust
company, bank, banker or other depository, wherever situated, if such
certificate shall be deemed by the Trustee to be satisfactory, showing that at
the date therein mentioned such Person had on deposit with such depository, or
exhibited to it, the Bearer Securities therein described; or such facts may be
proved by the certificate or affidavit of the Person holding such Bearer
Securities, if such certificate or affidavit is deemed by the Trustee to be
satisfactory. The Trustee and the Company may assume that such ownership of any
Bearer Security continues until (i) another such certificate or affidavit
bearing a later date issued in respect of the same Bearer Security is produced,
(ii) such Bearer Security is produced to the Trustee by some other Person, (iii)
such Bearer Security is surrendered in exchange for a Registered Security or
(iv) such Bearer Security is no longer Outstanding. The ownership of Bearer
Securities may also be proved in any other manner which the Trustee deems
sufficient.
(d) The ownership of Registered Securities shall be proved by
the Register (as defined below).
(e) Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Security issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by the Trustee or
the Company in reliance thereon, whether or not notation of such action is made
upon such Security.
(f) If the Company shall solicit from the Holders of any
series any request, demand, authorization, direction, notice, consent, waiver or
other Act, the Company may, at its option, fix in advance a record date for the
determination of Holders of such series entitled to give such request, demand,
authorization, direction, notice, consent, waiver or other Act, but the Company
shall have no obligation to do so. If such a record date is fixed, such request,
demand, authorization, direction, notice, consent, waiver or other Act may be
given before or after such record date, but only the Holders of such series of
record at the close of business on such record date shall be deemed to be
Holders for the purposes of determining whether Holders of the requisite
proportion of Outstanding Securities of such series have authorized or agreed or
consented to such request, demand, authorization, direction, notice, consent,
waiver or other Act, and for that purpose the Outstanding Securities of such
series shall be computed as of such record date; provided that no such
authorization, agreement or consent by the Holders on such record date shall be
deemed effective unless taken on or prior to the applicable Expiration Date (as
defined below) by Holders of the requisite amount of Outstanding Securities of
such series on such record date. Nothing in this paragraph shall be construed to
prevent the Company from setting a new record date for any action for which a
record date has previously been set pursuant to this paragraph (whereupon the
record date previously set shall automatically and with no action by any Person
be cancelled and of no effect), and nothing in this paragraph shall be construed
to render ineffective any action taken by Holders of the requisite amount of
Outstanding Securities on the date such action is taken. Promptly after any
record date is set pursuant to this paragraph, the Company, at its own expense,
shall cause notice of such record date, the proposed action by Holders and the
applicable Expiration Date to be given to the Trustee in writing and to each
Holder of Notes in the manner set forth in Section 1.6.
With respect to any record date set pursuant to this Section 1.4, the
Company may designate any date as the "Expiration Date" and from time to time
may change the Expiration Date to any earlier or later day; provided that no
such change shall be effective unless notice of the proposed new Expiration Date
is given to the Trustee, and to each Holder of Securities of the applicable
series in the manner set forth in Section 1.6 on or prior to the existing
Expiration Date. If an Expiration Date is not designated with respect to any
record date pursuant to this Section, the Company shall be deemed to have
initially designated the 180th day after such record date as the Expiration Date
with respect thereto, subject to its right to change the Expiration Date as
provided in this paragraph. Notwithstanding the foregoing, no Expiration Date
shall be later than the 180th day after the applicable record date.
(g) Without limiting the foregoing, a Holder entitled
hereunder to take any action hereunder with regard to any particular Security
may do so with regard to all or any part of the principal amount of such
Security or by one or more duly appointed agents, each of which may do so
pursuant to such appointment with regard to all or any part of such principal
amount.
(h) The Company and the Trustee may make reasonable rules for
action by or at a meeting of Holders.
Section 1.5. Notices, etc., to Trustee and Company. Any request,
demand, authorization, direction, notice, consent, waiver or Act of Holders or
other document provided or permitted by this Indenture to be made upon, given or
furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be
sufficient for every purpose hereunder if made,
given, furnished or filed in writing to or with the
Trustee at its Corporate Trust Office, Attention:
________________, or
(2) the Company by the Trustee or by any Holder shall be
sufficient for every purpose hereunder (unless
otherwise herein expressly provided) if in writing
and mailed, first-class postage prepaid, to the
Company addressed to it at America Online, Inc.,
22,000 AOL Way, Dulles, VA 20166 or at any other
address previously furnished in writing to the
Trustee by the Company.
Section 1.6. Notice to Holders; Waiver. Where this Indenture provides
for notice to Holders of any event, (i) if any of the Securities affected by
such event are Registered Securities, such notice to the Holders thereof shall
be sufficiently given (unless otherwise herein or in the terms of such
Securities expressly provided) if in writing and mailed, first-class postage
prepaid, to each such Holder affected by such event, at his address as it
appears in the Register, within the time prescribed for the giving of such
notice and, (ii) if any of the Securities affected by such event are Bearer
Securities, notice to the Holders thereof shall be sufficiently given (unless
otherwise herein or in the terms of such Bearer Securities expressly provided)
if published once in an Authorized Newspaper in New York, New York, and in such
other city or cities, if any, as may be specified as contemplated by Section
3.1.
In any case where notice to Holders is given by mail, neither the
failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice with respect to
other Holders of Registered Securities or the sufficiency of any notice to
Holders of Bearer Securities given as provided herein. In any case where notice
is given to Holders by publication, neither the failure to publish such notice,
nor any defect in any notice so published, shall affect the sufficiency of such
notice with respect to other Holders of Bearer Securities or the sufficiency of
any notice to Holders of Registered Securities given as provided herein. Any
notice mailed to a Holder in the manner herein prescribed shall be conclusively
deemed to have been received by such Holder, whether or not such Holder actually
receives such notice.
If by reason of the suspension of regular mail service or by reason of
any other cause it shall be impracticable to give such notice as provided above,
then such notification as shall be made with the approval of the Trustee (such
approval not to be unreasonably withheld) shall constitute a sufficient
notification for every purpose hereunder. If it is impossible or, in the opinion
of the Trustee, impracticable to give any notice by publication in the manner
herein required, then such publication in lieu thereof as shall be made with the
approval of the Trustee shall constitute a sufficient publication of such
notice.
Any request, demand, authorization, direction, notice, consent or
waiver required or permitted under this Indenture shall be in the English
language, except that any published notice may be in an official language of the
country of publication.
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 equivalent of such notice.
Waivers of notice by Holders shall be filed with the Trustee, but such filing
shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
Section 1.7. 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 1.8. Successor and Assigns. All covenants and agreements in
this Indenture by the Company shall bind its successor and assigns, whether so
expressed or not.
Any act or proceeding that is required or permitted by any provision of
this Indenture and that is authorized or required to be done or performed by any
board, committee or officer of the Company shall and may be done and performed
with like force and effect by the like board, committee or officer of any
corporation that shall at the time be the successor or assign of the Company.
Section 1.9. Separability. In case any provision of this Indenture or
the Securities shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
Section 1.10. Benefits of Indenture. Nothing in this Indenture or in
the Securities, expressed or implied, shall give to any Person, other than the
parties hereto and their successors hereunder, any Agent and the Holders, any
benefit or any legal or equitable right, remedy or claim under this Indenture.
Section 1.11. Governing Law. UNLESS OTHERWISE PROVIDED WITH RESPECT TO
ANY SECURITIES OF ANY SERIES PURSUANT TO SECTION 3.1, THIS 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, INCLUDING ALL
MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE. This Indenture is subject to
the Trust Indenture Act and if any provision hereof limits, qualifies or
conflicts with a provision of the Trust Indenture Act that is required by the
Trust Indenture 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, whether or not such provision of this
Indenture refers expressly to such provision of the Trust Indenture Act.
Section 1.12. Legal Holidays. Unless otherwise provided with respect to
any Security or Securities pursuant to Section 3.1, in any case where any
Interest Payment Date, Redemption Date, sinking fund payment date, Stated
Maturity or Maturity or other payment date of any Security shall not be a
Business Day at any Place of Payment, then, notwithstanding any other provision
of this Indenture or any Security or coupon, payment of principal, premium, if
any or interest or other payments need not be made at such Place of Payment on
such date, but may be made on the next succeeding Business Day at such Place of
Payment with the same force and effect as if made on such date; provided that no
interest shall accrue on the amount so payable for the period from and after
such Interest Payment Date, Redemption Date, sinking fund payment date, Stated
Maturity or Maturity or other payment date, as the case may be.
Section 1.13. No Recourse Against Others. No past, present or future
director, officer, employee, agent, member, manager, trustee or stockholder, as
such, of the Company or any successor Person shall have any liability for any
obligations of the Company or any successor Person, either directly or through
the Company or any successor Person, under the Securities or this Indenture or
for any claim based on, in respect of or by reason of such obligations or their
creation, whether by virtue of any rule of law, statute or constitutional
provision or by the enforcement of any assessment or by any legal or equitable
proceeding or otherwise. By accepting a Security, each Holder agrees to the
provisions of this Section 1.13 and waives and releases all such liability. Such
waiver and release shall be part of the consideration for the issue of the
Securities.
ARTICLE II
SECURITY FORMS
Section 2.1. Forms Generally. The Securities of each series and the
coupons, if any, to be attached thereto shall be in substantially such form as
shall be established by or pursuant to a Board Resolution or in one or more
indentures supplemental hereto, in each case with such appropriate insertions,
omissions, substitutions and other variations as are required or permitted by
this Indenture, and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as may be
required to comply with any applicable law, rule or regulation or with the rules
or usage of any securities exchange or Depository therefor or as may,
consistently herewith, be determined by the officers executing such Securities
and coupons, if any, as evidenced by their execution of the Securities and
coupons, if any. If temporary Securities of any series are issued as permitted
by Section 3.4, the form thereof also shall be established as provided in the
preceding sentence. If the forms of Securities and coupons, if any, of any
series are established by, or by action taken pursuant to, a Board Resolution, a
copy of the Board Resolution together with an appropriate record of any such
action taken pursuant thereto, including a copy of the approved form of
Securities or coupons, if any, shall be certified by the Corporate Secretary or
an Assistant Secretary of the Company and delivered to the Trustee at or prior
to the delivery of the Company Order contemplated by Section 3.3 for the
authentication and delivery of such Securities.
Unless otherwise specified as contemplated by Section 3.1, Bearer
Securities shall have interest coupons attached.
The definitive Securities and coupons, if any, shall be typeset,
printed, lithographed or engraved on steel engraved borders or may be produced
in any other manner or medium, all as determined by the officers executing such
Securities and coupons, if any, as evidenced by their execution of such
Securities and coupons, if any.
Section 2.2. Form of Trustee's Certificate of Authentication. Subject
to Section 6.13, the Trustee's certificate of authentication shall be in
substantially the following form:
This is one of the Securities of the series designated herein and
issued under the within-mentioned Indenture.
__________________________, as Trustee
Dated: By:
Authorized Signatory
Section 2.3. Securities in Global Form. If Securities of or within a
series are issuable in whole or in part in global form, any such Security may
provide that it shall represent the aggregate or specified amount of Outstanding
Securities from time to time endorsed thereon and may also provide that the
aggregate amount of Outstanding Securities represented thereby may from time to
time be reduced or increased to reflect exchanges. Any endorsement of a Security
in global form to reflect the amount, or any increase or decrease in the amount,
or changes in the rights of Holders, of Outstanding Securities represented
thereby, shall be made in such manner and by such Person or Persons as shall be
specified therein or in the Company Order to be delivered to the Trustee
pursuant to Section 3.3 or 3.4. Subject to the provisions of Section 3.3 and, if
applicable, Section 3.4, the Trustee shall deliver and redeliver any security in
permanent global form in the manner and upon instructions given by the Person or
Persons specified therein or in the applicable Company Order. Any instructions
by the Company with respect to endorsement or delivery or redelivery of a
Security in global form shall be in writing but need not comply with Section 1.2
hereof and need not be accompanied by an Opinion of Counsel.
The provisions of the last paragraph of Section 3.3 shall apply to any
Security in global form if such Security was never issued and sold by the
Company and the Company delivers to the Trustee the Security in global form
together with written instructions (which need not comply with Section 1.2 and
need not be accompanied by an Opinion of Counsel) with regard to the reduction
in the principal amount of Securities represented thereby, together with the
written statement contemplated by the last paragraph of Section 3.3.
Notwithstanding the provisions of Section 2.1 and 3.7, unless otherwise
specified as contemplated by Section 3.1, payment of principal of, premium, if
any, and interest on any Security in permanent global form shall be made to the
Person or Persons specified therein.
Section 2.4. Form of Legend for Securities in Global Form. Unless
otherwise provided with respect to any Securities of any series pursuant to
Section 3.1 or required by the Depository, any Security of such series in global
form authenticated and delivered hereunder shall bear a legend in substantially
the following form:
This Security is in global form within the meaning of the
Indenture hereinafter referred to and is registered in the
name of a Depository or a nominee of a Depository. Unless and
until it is exchanged in whole or in part for Securities in
certificated form, this Security may not be transferred except
as a whole by the Depository to a nominee of the Depository or
by a nominee of the Depository to the Depository or another
nominee of the Depository or by the Depository or any such
nominee to a successor Depository or a nominee of such
successor Depository. Every Security authenticated and
delivered upon registration of, or in exchange for, or in lieu
of, this Security will be in global form, subject to the
foregoing.
ARTICLE III
THE SECURITIES
Section 3.1. Amount Unlimited; Issuable in Series. (a) The aggregate
principal amount of Securities which may be authenticated, delivered and
outstanding under this Indenture is unlimited. The Securities may be issued from
time to time in one or more series.
(b) The following matters shall be established with respect to
each series of Securities issued hereunder (i) by a Board Resolution, (ii) by
action taken pursuant to a Board Resolution and (subject to Section 3.3) set
forth, or determined in the manner provided, in an Officers' Certificate or
(iii) in one or more indentures supplemental hereto:
(1) the title of the Securities of the series
(which title shall distinguish the
Securities of the series from all other
series of Securities);
(2) any limit upon the aggregate principal
amount of the Securities of the series which
may be authenticated, delivered and
outstanding under this Indenture (which
limit shall not pertain to Securities
authenticated and delivered upon
registration of transfer of, or in exchange
for, or in lieu of, other Securities of the
series pursuant to Section 3.4, 3.5, 3.6,
8.6, or 10.7 and except for any Securities
which, pursuant to Section 3.3, are deemed
never to have been authenticated and
delivered hereunder);
(3) the date or dates on which the principal of
and premium, if any, on the Securities of
the series is payable or the method of
determination and/or extension of such date
or dates; and the amount or amounts of such
principal and premium, if any, payments or
the method of determination thereof;
(4) the rate or rates (which may be fixed or
variable) at which the Securities of the
series shall bear interest, if any, or the
method of calculating and/or resetting such
rate or rates of interest, the date or dates
from which such interest shall accrue or the
method by which such date or dates shall be
determined, the Interest Payment Dates on
which any such interest shall be payable or
the method by which such dates will be
determined and, with respect to Registered
Securities, the Regular Record Date, if any,
for the interest payable on any Registered
Security on any Interest Payment Date and
the basis upon which interest shall be
calculated if other than upon a 360-day year
of twelve 30-day months;
(5) the place or places where the principal of,
premium, if any, and interest, if any, on
Securities of the series shall be payable;
(6) the period or periods within which, the
price or prices at which, the currency or
currencies (including currency units) in
which, and the other terms and conditions
upon which, Securities of the series may be
redeemed, in whole or in part, at the option
of the Company or otherwise, and, if other
than as provided in Section 10.3, the manner
in which the particular Securities of such
series (if less than all Securities of such
series are to be redeemed) are to be
selected for redemption;
(7) the obligation, if any, of the Company to
redeem or purchase Securities of the series
pursuant to any sinking fund or analogous
provisions or upon the happening of a
specified event or at the option of a Holder
thereof and the period or periods within
which, the price or prices at which, and the
other terms and conditions upon which,
Securities of the series shall be redeemed
or purchased, in whole or in part, pursuant
to such obligation and provisions for the
remarketing of such series;
(8) if other than denominations of $1,000 and
any integral multiple thereof, for
Registered Securities, and if other than
denominations of $5,000 and any integral
multiple thereof, for Bearer Securities, the
denominations in which Securities of the
series shall be issuable;
(9) if other than Dollars, the currency or
currencies (including currency unit or
units) in which the principal of, premium,
if any, and interest, if any, or other
payments, if any, on the Securities of the
series shall be payable, or in which the
Securities of the series shall be
denominated, and the particular provisions
applicable thereto in accordance with, in
addition to, or in lieu of the provisions of
Section 3.11;
(10) the terms, if any, upon which Securities of
the series may be convertible into or
exchanged for other Securities of the
Company and the terms and conditions upon
which the conversion or exchange shall be
effected, including the initial conversion
or exchange price or rate, the conversion or
exchange period, and any other additional
provisions;
(11) if the payments of principal of, premium, if
any, or interest, if any, or other payments,
if any, on the Securities of the series are
to be made, at the election of the Company
or a Holder, in a currency or currencies
(including currency unit or units) other
than that in which such Securities are
denominated or designated to be payable, the
currency or currencies (including currency
unit or units) in which such payments are to
be made, the terms and conditions of such
payments and the manner in which the
exchange rate with respect to such payments
shall be determined, and the particular
provisions applicable thereto in accordance
with, in addition to, or in lieu of the
provisions of Section 3.11;
(12) if the amount of payments of principal of,
premium, if any, and interest, if any, or
other payments, if any, on the Securities of
the series shall be determined with
reference to an index, formula or other
method (which index, formula or method may
be based, without limitation, on the price
of one or more commodities, derivatives or
securities; one or more securities,
derivatives or commodities exchange indices
or other indices; a currency or currencies
(including currency unit or units) other
than that in which the Securities of the
series are denominated or designated to be
payable; or any other variable or the
relationship between any variables or
combination of variables), the index,
formula or other method by which such
amounts shall be determined;
(13) if other than the principal amount thereof,
the portion of the principal amount of such
Securities of the series or other amount
which shall be payable upon declaration of
acceleration thereof pursuant to Section 5.2
or provable in bankruptcy or the method by
which such portion or amount shall be
determined;
(14) if other than as provided in Section 3.7,
the Person to whom any interest on any
Registered Security of the series shall be
payable and the manner in which, or the
Person to whom, any interest on any Bearer
Securities of the series shall be payable;
(15) if the principal amount payable at the
Maturity of any Securities of the series
will not be determinable as of one or more
dates prior to Maturity, the amount which
shall be deemed to be the principal amount
of such Securities as of any such date
hereunder or thereunder, or, if other than
as provided in the definition of the term
"Outstanding", which shall be deemed to be
Outstanding as of any date prior to the
Stated Maturity (or, in any such case, the
manner in which such amount deemed to be the
principal amount shall be determined) and,
if necessary, the manner of determining the
equivalent thereof in U.S. currency;
(16) provisions, if any, granting special rights
to the Holders of Securities of the series
upon the occurrence of such events as may be
specified;
(17) the applicability of or any deletions from,
modifications of or additions to the Events
of Default set forth in Section 5.1 or
covenants of the Company set forth in
Article IX pertaining to the Securities of
the series;
(18) under what circumstances, if any, the
Company will pay additional amounts on the
Securities of that series held by a Person
who is not a U.S. Person in respect of taxes
or similar charges withheld or deducted and,
if so, whether the Company will have the
option to redeem such Securities rather than
pay such additional amounts (and the terms
of any such option);
(19) whether Securities of the series shall be
issuable as Registered Securities or Bearer
Securities (with or without interest
coupons), or both, and any restrictions
applicable to the offering, sale or delivery
of Bearer Securities and, if other than as
provided in Section 3.5, the terms upon
which Bearer Securities of a series may be
exchanged for Registered Securities of the
same series and vice versa;
(20) the date as of which any Bearer Securities
of the series and any temporary global
Security representing Outstanding Securities
of the series shall be dated if other than
the date of original issuance of the first
Security of the series to be issued;
(21) the forms of the Securities and coupons,
if any, of the series;
(22) any changes or additions to the provisions
provided in Article Four of this Indenture
pertaining to defeasance, including without
limitation, the exclusion of Section 4.4 or
4.5, or both, with respect to the Securities
of or within the series; or the
applicability, if any, to the Securities of
or within the series of such means of
defeasance or covenant defeasance other than
those provided in Sections 4.4 and 4.5 as
may be specified for the Securities and
coupons, if any, of such series, and
whether, for the purpose of any defeasance
or covenant defeasance pursuant to Section
4.4 or 4.5 or otherwise, the term
"Government Obligations" shall include
obligations referred to in the definition of
such term which are not obligations of the
United States or an agency or
instrumentality of the United States;
(23) if other than the Trustee, the identity of
the Registrar and any Paying Agent;
(24) any terms which may be related to warrants,
options or other rights to purchase and sell
securities issued by the Company in
connection with, or for the purchase of,
Securities of such series, including whether
and under what circumstances the Securities
of any series may be used toward the
exercise price of any such warrants, options
or other rights;
(25) the designation of the initial Exchange Rate
Agent, if any;
(26) whether any of the Securities of the series
shall be issued in whole or in part in
global form, and if so (i) the Depository
for such global Securities, (ii) the form of
any legend in addition to or in lieu of that
in Section 2.4 which shall be borne by such
global Securities, (iii) whether beneficial
owners of interests in any Securities of the
series in global form may exchange such
interests for certificated Securities of
such series and of like tenor of any
authorized form and denomination, and (iv)
if other than as provided in Section 3.5,
the circumstances under which any such
exchange may occur;
(27) the subordination, if any, of the Securities
of the series;
(28) if the Securities of the series will be
governed by, and the extent to which such
Securities will be governed by, any law
other than the laws of the state of New
York; and
(29) the terms, if any, of any guarantee of the
payment of principal, premium and interest
with respect to Securities of the series and
any corresponding changes to the provisions
of this Indenture as then in effect;
(30) the terms, if any, of the transfer,
mortgage, pledge or assignment as security
for the Securities of the series of any
properties, assets, moneys, proceeds,
securities or other collateral, including
whether certain provisions in the Trust
Indenture Act are applicable and any
corresponding changes to provisions of this
Indenture as then in effect;
(31) any other terms of the series, including any
terms which may be required by or advisable
under United States laws or regulations or
advisable (as determined by the Company) in
connection with the marketing of Securities
of the series.
(c) The terms applicable to the Securities of any one series
and coupons, if any, appertaining to any Bearer Securities of such series need
not be identical but may vary as may be provided (i) by a Board Resolution, (ii)
by action taken pursuant to a Board Resolution and (subject to Section 3.3) set
forth, or determined in the manner provided, in the related Officers'
Certificate or (iii) in an indenture supplemental hereto. All Securities of any
one series need not be issued at the same time and, unless otherwise provided, a
series may be reopened, without the consent of the Holders, for issuances of
additional Securities of such series.
(d) If any of the terms of the Securities of any series are
established by action taken pursuant to a Board Resolution, a copy of such Board
Resolution shall be certified by the Corporate Secretary or an Assistant
Secretary of the Company and delivered to the Trustee at or prior to the
delivery of the Officers' Certificate setting forth, or providing the manner for
determining, the terms of the Securities of such series, and an appropriate
record of any action taken pursuant thereto in connection with the issuance of
any Securities of such series shall be delivered to the Trustee prior to the
authentication and delivery thereof.
Section 3.2. Denominations. Unless otherwise provided as contemplated
by Section 3.1, any Registered Securities of a series shall be issuable in
denominations of $1,000 and any integral multiple thereof and any Bearer
Securities of a series shall be issuable in the denomination of $5,000 and any
integral multiple thereof.
Section 3.3. Execution, Authentication, Delivery and Dating. Securities
shall be executed on behalf of the Company by the Chairman of the Board, any
Vice Chairman of the Board, the President, any Vice President or any Senior Vice
President and by the Treasurer, any Assistant Treasurer, the Corporate Secretary
or any Assistant Secretary of the Company. The Company's seal shall be
reproduced on the Securities and shall be attested by the Corporate Secretary or
any Assistant Secretary. The signatures of any of these officers on the
Securities may be manual or facsimile. The coupons, if any, of Bearer Securities
shall bear the facsimile signature of the Chairman of the Board, any Vice
Chairman, the President, any Senior Vice President, any Vice President, the
Treasurer or any Assistant Treasurer of the Company.
Securities and coupons bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind
the Company, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Securities or
did not hold such offices at the date of such Securities.
At any time and from time to time, the Company may deliver Securities,
together with any coupons appertaining thereto, of any series executed by the
Company to the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities, and the Trustee in accordance
with the Company Order shall authenticate and deliver such Securities; provided,
however, that in the case of Securities offered in a Periodic Offering, the
Trustee shall authenticate and deliver such Securities from time to time in
accordance with such other procedures (including, without limitation, the
receipt by the Trustee of oral or electronic instructions from the Company or
its duly authorized agents, promptly confirmed in writing) acceptable to the
Trustee as may be specified by or pursuant to a Company Order delivered to the
Trustee prior to the time of the first authentication of Securities of such
series.
If the form or terms of the Securities of a series have been
established by or pursuant to one or more Board Resolutions as permitted by
Sections 2.1 and 3.1, in authenticating such Securities and accepting the
additional responsibilities under this Indenture in relation to such Securities,
the Trustee shall be entitled to receive, and (subject to section 315(a) through
(d) of the Trust Indenture Act) shall be fully protected in relying upon, an
Opinion of Counsel substantially to the effect that,
(1) if the forms of such Securities and any coupons have
been established by or pursuant to a Board Resolution
as permitted by Section 2.1, such forms have been
established in conformity with the provisions of this
Indenture;
(2) if the terms of such Securities and any coupons have
been established by or pursuant to a Board Resolution
as permitted by Section 3.1, such terms have been, or
in the case of Securities of a series offered in a
Periodic Offering, will be, established in conformity
with the provisions of this Indenture, subject in the
case of Securities offered in a Periodic Offering, to
any conditions specified in such Opinion of Counsel;
and
(3) such Securities together with any coupons
appertaining thereto, when authenticated and
delivered by the Trustee and issued by the Company in
the manner and subject to any conditions specified in
such Opinion of Counsel, will constitute legal, valid
and binding obligations of the Company, enforceable
in accordance with their terms, subject to
bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and other similar laws of
general applicability relating to or affecting the
enforcement of creditors' rights and to general
equity principles and except further as enforcement
thereof may be limited by or subject to certain
exceptions and qualifications specified in such
Opinion of Counsel, including in the case of any
Securities denominated in a Foreign Currency, (A)
requirements that a claim with respect to any
Securities denominated other than in Dollars (or a
foreign currency or foreign currency unit judgment in
respect of such claim) be converted into Dollars at a
rate of exchange prevailing on a date determined
pursuant to applicable law or (B) governmental
authority to limit, delay or prohibit the making of
payments in foreign currency or currency units or
payments outside the United States.
Notwithstanding that such form or terms have been so established, the
Trustee shall have the right to decline to authenticate such Securities if, in
the written opinion of counsel to the Trustee (which counsel may be an employee
of the Trustee) reasonably acceptable to the Company, the issue of such
Securities pursuant to this Indenture will adversely affect the Trustee's own
rights, duties or immunities under this Indenture or otherwise in a manner which
is not reasonably acceptable to the Trustee. Notwithstanding the generality of
the foregoing, the Trustee will not be required to authenticate Securities
denominated in a Foreign Currency if the Trustee reasonably believes that it
would be unable to perform its duties with respect to such Securities.
Notwithstanding the provisions of Section 3.1 and of the two preceding
paragraphs, if all of the Securities of any series are not to be issued at one
time, it shall not be necessary to deliver the Officers' Certificate otherwise
required pursuant to Section 3.1 or the Company Order and Opinion of Counsel
otherwise required pursuant to the two preceding paragraphs in connection with
the authentication of each Security of such series if such documents, with
appropriate modifications to cover such future issuances, are delivered at or
prior to the authentication upon original issuance of the first Security of such
series to be issued.
With respect to Securities of a series offered in a Periodic Offering,
the Trustee may rely, as to the authorization by the Company of any of such
Securities, the form and terms thereof and the legality, validity, binding
effect and enforceability thereof, upon the Opinion of Counsel and the other
documents delivered pursuant to Sections 2.1 and 3.1 and this Section, as
applicable, in connection with the first authentication of Securities of such
series.
If the Company shall establish pursuant to Section 3.1 that the
Securities of a series are to be issued in whole or in part in global form,
then, unless otherwise provided with respect to such Securities pursuant to
Section 3.1, the Company shall execute and the Trustee shall, in accordance with
this Section and the Company Order with respect to such series, authenticate and
deliver one or more Securities in global form that (i) shall represent and shall
be denominated in an amount equal to the aggregate principal amount of the
Outstanding Securities of such series to be represented by such Security or
Securities in global form, (ii) shall be registered, if a Registered Security,
in the name of the Depository for such Security or Securities in global form or
the nominee of such Depository, (iii) shall be delivered by the Trustee to such
Depository or pursuant to such Depository's instruction and (iv) shall bear the
legend set forth in Section 2.4.
Unless otherwise established pursuant to Section 3.1, each Depository
designated pursuant to Section 3.1 for a Registered Security in global form
must, at the time of its designation and at all times while it serves as
Depository, be a clearing agency registered under the Securities Exchange Act of
1934 and any other applicable statute or regulation. Neither the Company nor the
Trustee shall have any responsibility to determine if the Depository is so
registered.
Each Depository shall enter into an agreement with the Trustee
governing the respective duties and rights of such Depository and the Trustee
with regard to Securities issued in global form.
Each Registered Security shall be dated the date of its authentication
and each Bearer Security shall be dated as of the date specified as contemplated
by Section 3.1.
No Security or coupon appertaining thereto shall be entitled to any
benefits under this Indenture or be valid or obligatory for any purpose until
authenticated by the manual signature of one of the authorized signatories of
the Trustee or an Authenticating Agent and no coupon shall be valid until the
Security to which it appertains has been so authenticated. Such signature upon
any Security shall be conclusive evidence, and the only evidence, that such
Security has been duly authenticated and delivered under this Indenture and is
entitled to the benefits of this Indenture. Except as permitted by Section 3.6
or 3.7, the Trustee shall not authenticate and deliver any Bearer Security
unless all appurtenant coupons for interest then matured have been detached and
cancelled.
Notwithstanding the foregoing, if any Security shall have been
authenticated and delivered hereunder but never issued and sold by the Company,
and the Company shall deliver such Security to the Trustee for cancellation as
provided in Section 3.9 together with a written statement (which need not comply
with Section 1.2 and need not be accompanied by an Opinion of Counsel) stating
that such Security has never been issued and sold by the Company, for all
purposes of this Indenture such Security shall be deemed never to have been
authenticated and delivered hereunder and shall not be entitled to the benefits
of this Indenture.
Section 3.4. Temporary Securities. Pending the preparation of
definitive Securities of any series, the Company may execute and, upon Company
Order, the Trustee shall authenticate and deliver temporary Securities of such
series which are printed, lithographed, typewritten, mimeographed or otherwise
produced, in any authorized denomination, substantially of the tenor and form,
with or without coupons, of the definitive Securities in lieu of which they are
issued and with such appropriate insertions, omissions, substitutions and other
variations as the officers executing such Securities may determine, as
conclusively evidenced by their execution of such Securities and coupons, if
any. In the case of Securities of any series, all or a portion of such temporary
Securities may be in global form.
Except in the case of temporary Securities in global form, each of
which shall be exchanged in accordance with the provisions thereof, if temporary
Securities of any series are issued, the Company will cause definitive
Securities of such series to be prepared without unreasonable delay. After
preparation of definitive Securities of such series, the temporary Securities of
such series shall be exchangeable for definitive Securities of such series upon
surrender of the temporary Securities of such series at the office or agency of
the Company pursuant to Section 9.2 in a Place of Payment for such series,
without charge to the Holder. Upon surrender for cancellation of any one or more
temporary Securities of any series (accompanied by any unmatured coupons
appertaining thereto), the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like principal amount of
definitive Securities of the same series of authorized denominations and of like
tenor; provided, however, that no definitive Bearer Security shall be delivered
in exchange for a temporary Registered Security; and provided further that no
definitive Bearer Security shall be delivered in exchange for a temporary Bearer
Security unless the Trustee shall have received from the person entitled to
receive the definitive Bearer Security a certificate substantially in the form
approved in or pursuant to the Board Resolutions relating thereto and such
delivery shall occur only outside the United States. Until so exchanged, the
temporary Securities of any series shall in all respects be entitled to the same
benefits under this Indenture as definitive Securities of such series except as
otherwise specified as contemplated by Section 3.1.
Section 3.5. Registration, Transfer and Exchange. The Company shall
cause to be kept at the Corporate Trust Office of the Trustee or in any office
or agency to be maintained by the Company in accordance with Section 9.2 in a
Place of Payment or in such other place or medium as may be specified pursuant
to Section 3.1 a register for each series of Securities (the registers
maintained in such office or in any such office or agency of the Company in a
Place of Payment being herein sometimes referred to collectively as the
"Register") in which, subject to such reasonable regulations as it may
prescribe, the Company shall provide for the registration of Registered
Securities and the registration of transfers of Registered Securities. The
Register shall be in written form or any other form capable of being converted
into written form within a reasonable time. Unless otherwise provided as
contemplated by Section 3.1, the Trustee is hereby appointed "Registrar" for the
purpose of registering Registered Securities and transfers of Registered
Securities as herein provided.
Upon surrender for registration of transfer of any Registered Security
of any series at the office or agency maintained pursuant to Section 9.2 in a
Place of Payment for that series, the Company shall execute, and the Trustee
shall authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Registered Securities of the same series, of any
authorized denominations and of a like aggregate principal amount.
Unless otherwise provided as contemplated by Section 3.1, Bearer
Securities (except for any temporary global Bearer Securities) or any coupons
appertaining thereto (except for coupons attached to any temporary global Bearer
Security) shall be transferable by delivery.
Unless otherwise provided as contemplated by Section 3.1, at the option
of the Holder, Registered Securities of any series (except a Registered Security
in global form) may be exchanged for other Registered Securities of the same
series, of any authorized denominations and of a like aggregate principal amount
containing identical terms and provisions, upon surrender of the Registered
Securities to be exchanged at such office or agency. Whenever any Registered
Securities are so surrendered for exchange, the Company shall execute, and the
Trustee shall authenticate and deliver, the Registered Securities which the
Holder making the exchange is entitled to receive. Unless otherwise specified as
contemplated by Section 3.1, Bearer Securities may not be issued in exchange for
Registered Securities.
Unless otherwise specified as contemplated by Section 3.1, at the
option of the Holder, Bearer Securities of such series may be exchanged for
Registered Securities (if the Securities of such series are issuable in
registered form) or Bearer Securities (if Bearer Securities of such series are
issuable in more than one denomination and such exchanges are permitted by such
series) of the same series, of any authorized denominations and of like tenor
and aggregate principal amount, upon surrender of the Bearer Securities to be
exchanged at any such office or agency, with all unmatured coupons and all
matured coupons in default thereto appertaining. If the Holder of a Bearer
Security is unable to produce any such unmatured coupon or coupons or matured
coupon or coupons in default, such exchange may be effected if the Bearer
Securities are accompanied by payment in funds acceptable to the Company and the
Trustee in an amount equal to the face amount of such missing coupon or coupons,
or the surrender of such missing coupon or coupons may be waived by the Company
and the Trustee if there be furnished to them such security or indemnity as they
may require to save each of them and any Paying Agent harmless. If thereafter
the Holder of such Security shall surrender to any Paying Agent any such missing
coupon in respect of which such a payment shall have been made, such Holder
shall be entitled to receive the amount of such payment; provided, however,
that, except as otherwise provided in Section 9.2, interest represented by
coupons shall be payable only upon presentation and surrender of those coupons
at an office or agency located outside the United States. Notwithstanding the
foregoing, in case any Bearer Security of any series is surrendered at any such
office or agency in exchange for a Registered Security of the same series after
the close of business at such office or agency on (i) any Regular Record Date
and before the opening of business at such office or agency on the relevant
Interest Payment Date, or (ii) any Special Record Date and before the opening of
business at such office or agency on the related 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
(or, if such coupon is so surrendered with such Bearer Security, such coupon
shall be returned to the person so surrendering the Bearer Security), and
interest or Defaulted Interest, as the case may be, will not be payable on such
Interest Payment Date or proposed date for payment, as the case may be, in
respect of the Registered Security issued in exchange for such Bearer Security,
but will be payable only to the Holder of such coupon, when due in accordance
with the provisions of this Indenture.
Unless otherwise specified pursuant to Section 3.1 with respect to a
series of Securities or as otherwise provided below in this Section 3.5, owners
of beneficial interests in Securities of such series represented by a Security
issued in global form will not be entitled to have Securities of such series
registered in their names, will not receive or be entitled to receive physical
delivery of Securities of such series in certificated form and will not be
considered the Holders or owners thereof for any purposes hereunder.
Notwithstanding any other provision of this Section, unless and until it is
exchanged in whole or in part for Securities in certificated form in the
circumstances described below, a Security in global form representing all or a
portion of the Securities of a series may not be transferred or exchanged except
as a whole by the Depository for such series to a nominee of such Depository or
by a nominee of such Depository to such Depository or another nominee of such
Depository or by such Depository or any such nominee to a successor Depository
for such series or a nominee of such successor Depository.
If at any time the Depository for the Securities of a series notifies
the Company that it is unwilling or unable to continue as Depository for the
Securities of such series or if at any time the Depository for the Securities of
such series notifies the Company that it shall no longer be eligible under
Section 3.3, the Company shall appoint a successor Depository with respect to
the Securities of such series. Unless otherwise provided as contemplated by
Section 3.1, if a successor Depository for the Securities of such series is not
appointed by the Company within 90 days after the Company receives such notice
or becomes aware of such ineligibility, the Company's election pursuant to
Section 3.1(b) (26) shall no longer be effective with respect to the Securities
of such series and the Company shall execute, and the Trustee, upon receipt of a
Company Order for the authentication and delivery of certificated Securities of
such series of like tenor, shall authenticate and deliver, Securities of such
series of like tenor in certificated form, in authorized denominations and in an
aggregate principal amount equal to the principal amount of the Security or
Securities of such series of like tenor in global form in exchange for such
Security or Securities in global form.
The Company may at any time in its sole discretion determine that
Securities of a series issued in global form shall no longer be represented by
such a Security or Securities in global form. In such event the Company shall
execute, and the Trustee, upon receipt of a Company Order for the authentication
and delivery of certificated Securities of such series of like tenor, shall
authenticate and deliver, Securities of such series of like tenor in
certificated form, in authorized denominations and in an aggregate principal
amount equal to the principal amount of the Security or Securities of such
series of like tenor in global form in exchange for such Security or Securities
in global form.
If specified by the Company pursuant to Section 3.1 with respect to a
series of Securities, the Depository for such series may surrender a Security in
global form of such series in exchange in whole or in part for Securities of
such series in certificated form on such terms as are acceptable to the Company
and such Depository. Thereupon, the Company shall execute, and the Trustee shall
authenticate and deliver, without service charge,
(i) to each Person specified by such Depository a new
certificated Security or Securities of the same
series of like tenor, of any authorized denomination
as requested by such Person in aggregate principal
amount equal to and in exchange for such Person's
beneficial interest in the Security in global form;
and
(ii) to such Depository a new Security in global form of
like tenor in a denomination equal to the difference,
if any, between the principal amount of the
surrendered Security in global form and the aggregate
principal amount of certificated Securities delivered
to Holders thereof.
(iii) Upon the exchange of a Security in global form for
Securities in certificated form, such Security in
global form shall be cancelled by the Trustee. Unless
expressly provided with respect to the Securities of
any series that such Security may be exchanged for
Bearer Securities, Securities in certificated form
issued in exchange for a Security in global form
pursuant to this Section shall be registered in such
names and in such authorized denominations as the
Depository for such Security in global form, pursuant
to instructions from its direct or indirect
participants or otherwise, shall instruct the
Trustee. The Trustee shall deliver such Securities to
the Persons in whose names such Securities are so
registered.
Whenever any Securities are surrendered for exchange, the Company shall
execute, and the Trustee shall authenticate and deliver, the Securities which
the Holder making the exchange is entitled to receive.
All Securities issued upon any registration of transfer or upon any
exchange of Securities shall be the valid obligations of the Company, evidencing
the same debt, and entitled to the same benefits under this Indenture, as the
Securities surrendered upon such registration of transfer or exchange.
Every Registered Security presented or surrendered for registration of
transfer or for exchange shall (if so required by the Company, the Registrar or
the Trustee) be duly endorsed, or be accompanied by a written instrument of
transfer in form satisfactory to the Company, the Registrar and the Trustee duly
executed by the Holder thereof or his attorney duly authorized in writing.
Unless otherwise provided as contemplated by Section 3.1, no service
charge shall be made for any registration of transfer or for any exchange of
Securities, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in connection with any
registration or transfer or exchange of Securities, other than exchanges
pursuant to Section 3.4 or 10.7 not involving any transfer.
Unless otherwise provided as contemplated by Section 3.1, the Company
shall not be required (i) to issue, register the transfer of, or exchange any
Securities for a period beginning at the opening of 15 Business Days before any
selection for redemption of Securities of like tenor and of the series of which
such Security is a part and ending at the close of business on the earliest date
on which the relevant notice of redemption is deemed to have been given to all
Holders of Securities of like tenor and of such series to be redeemed; (ii) to
register the transfer of or exchange any Registered Security so selected for
redemption, in whole or in part, except the unredeemed portion of any Security
being redeemed in part; or (iii) to exchange any Bearer Security so selected for
redemption, except that such a Bearer Security may be exchanged for a Registered
Security of that series and like tenor; provided that such Registered Security
shall be simultaneously surrendered for redemption.
Section 3.6. Replacement Securities. If a mutilated Security or a
Security with a mutilated coupon appertaining to it is surrendered to the
Trustee, together with, in proper cases, such security or indemnity as may be
required by the Company or the Trustee to save each of them harmless, the
Company shall execute and the Trustee shall authenticate and deliver a
replacement Registered Security, if such surrendered Security was a Registered
Security, or a replacement Bearer Security with coupons corresponding to the
coupons appertaining to the surrendered Security, if such surrendered Security
was a Bearer Security, of the same series and date of maturity.
If there shall be delivered to the Company and the Trustee (i) evidence
to their satisfaction of the destruction, loss or theft of any Security or
Security with a destroyed, lost or stolen coupon and (ii) such security or
indemnity as may be required by them to save each of them and any agent of
either of them harmless, then, in the absence of notice to the Company or the
Trustee that such Security or coupon has been acquired by a bona fide purchaser,
the Company shall execute and the Trustee shall authenticate and deliver in lieu
of any such destroyed, lost or stolen Security or in exchange for the Security
to which a destroyed, lost or stolen coupon appertains (with all appurtenant
coupons not destroyed, lost or stolen), a replacement Registered Security, if
such Holder's claim appertains to a Registered Security, or a replacement Bearer
Security with coupons corresponding to the coupons appertaining to the
destroyed, lost or stolen Bearer Security or the Bearer Security to which such
lost, destroyed or stolen coupon appertains, if such Holder's claim appertains
to a Bearer Security, of the same series and principal amount, containing
identical terms and provisions and bearing a number not contemporaneously
outstanding with coupons corresponding to the coupons, if any, appertaining to
the destroyed, lost or stolen Security.
In case any such mutilated, destroyed, lost or stolen Security or
coupon has become or is about to become due and payable, the Company in its
discretion may, instead of issuing a new Security or coupon, pay such Security
or coupon; provided, however, that payment of principal of and any premium or
interest on Bearer Securities shall, except as otherwise provided in Section
9.2, be payable only at an office or agency located outside the United States
and, unless otherwise specified as contemplated by Section 3.1, any interest on
Bearer Securities shall be payable only upon presentation and surrender of the
coupons appertaining thereto.
Upon the issuance of any new Security under this Section, the Company
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee, its agents and
counsel) connected therewith.
Every new Security of any series with its coupons, if any, issued
pursuant to this Section in lieu of any destroyed, lost or stolen Security, or
in exchange for a Security to which a destroyed, lost or stolen coupon
appertains, shall constitute an original additional contractual obligation of
the Company, whether or not the destroyed, lost or stolen Security and its
coupon, if any, or the destroyed, lost or stolen coupon, shall be at any time
enforceable by anyone, and shall be entitled to all the benefits of this
Indenture equally and proportionately with any and all other Securities of that
series and their coupons, if any, duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities or coupons.
Section 3.7. Payment of Interest; Interest Rights Preserved. (a) Unless
otherwise provided as contemplated by Section 3.1, interest, if any, 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 at the office or agency
maintained for such purpose pursuant to 9.2; provided, however, that at the
option of the Company, interest on any series of Registered Securities that bear
interest may be paid (i) by check mailed to the address of the Person entitled
thereto as it shall appear on the Register of Holders of Securities of such
series or (ii) by wire transfer to an account maintained by the Person entitled
thereto as specified in the Register of Holders of Securities of such series.
Unless otherwise provided as contemplated by Section 3.1, (A) (i)
interest, if any, on Bearer Securities shall be paid only against presentation
and surrender of the coupons for such interest installments as are evidenced
thereby as they mature and (ii) principal, original issue discount, if any, and
premium, if any, on Bearer Securities shall be paid only against presentation
and surrender of such Securities; in either case at the office of a Paying Agent
located outside the United States, unless the Company shall have otherwise
instructed the Trustee in writing provided that any such instruction for payment
in the United States does not cause any Bearer Security to be treated as a
"registration-required obligation" under United States laws and regulations; (B)
the interest, if any, on any temporary Bearer Security shall be paid, as to any
installment of interest evidenced by a coupon attached thereto only upon
presentation and surrender of such coupon as provided in clause (A) above and,
as to other installments of interest, only upon presentation of such Security
for notation thereon of the payment of such interest; and (C) if at the time a
payment of principal of premium, if any, or interest, if any, on a Bearer
Security or coupon shall become due, the payment of the full amount so payable
at the office or offices of all the Paying Agents outside the United States is
illegal or effectively precluded because of the imposition of exchange controls
or other similar restrictions on the payment of such amount in Dollars, then the
Company may instruct the Trustee to make such payment at a Paying Agent located
in the United States, provided that provision for such payment in the United
States would not cause such Bearer Security to be treated as a
"registration-required obligation" under United States laws and regulations.
(b) Unless otherwise provided as contemplated by Section 3.1,
any interest on any Registered Security of any series which is payable, but is
not punctually paid or duly provided for, on any interest payment date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on the relevant Regular Record Date by virtue of having been such Holder, and
such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in clause (1) or (2) below:
(1) The Company may elect to make payment of any
Defaulted Interest to the Persons in whose
names such Registered Securities of such
series (or their respective Predecessor
Securities) are registered at the close of
business on a Special Record Date for the
payment of such Defaulted Interest, which
shall be fixed in the following manner. The
Company shall 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 (1) provided. Thereupon
the Trustee shall fix a Special Record Date
for the payment of such Defaulted Interest
which shall be not more than 15 days and not
less than 10 days prior to the date of the
proposed payment and not less than 10 days
after the receipt by the Trustee of the
notice of the proposed payment. The Trustee
shall promptly notify the Company of such
Special Record Date and, in the name and at
the expense of the Company, shall cause
notice of the proposed payment of such
Defaulted Interest and the Special Record
Date therefor to be mailed, first-class
postage prepaid, to each Holder of such
Registered Securities of such series at his
address as it appears in the 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 such Registered
Securities of such series (or their
respective Predecessor Securities) are
registered at the close of business on such
Special Record Date and shall no longer be
payable pursuant to the following clause
(2).
(2) The Company may make payment of any
Defaulted Interest to the Persons in whose
names such Registered Securities of such
series (or their respective Predecessor
Securities) are registered at the close of
business on a specified date in any other
lawful manner not inconsistent with the
requirements of any securities exchange on
which such Registered 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
(2), such manner of payment shall be deemed
practicable by the Trustee.
(c) 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.
Section 3.8. Persons Deemed Owners. Prior to due presentment of any
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 Security for
the purpose of receiving payment of principal of, premium, if any, and (subject
to Section 3.7) interest and any other payments on such Registered Security and
for all other purposes whatsoever, whether or not such Registered Security shall
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.
The Company, the Trustee and any agent of the Company or the Trustee
may treat the bearer of any Bearer Security and the bearer of any coupon as the
absolute owner of such Bearer Security or coupon for the purpose of receiving
payment thereof or on account thereof and for all other purposes whatsoever,
whether or not such Bearer Security or coupon be overdue, and neither the
Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary.
None of the Company, the Trustee or any agent of the Company or the
Trustee shall have any responsibility or liability for any aspect of the records
relating to or payments made on account of beneficial ownership interests of a
Security in global form, or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interests. Notwithstanding the
foregoing, with respect to any Security in global form, nothing herein shall
prevent the Company or the Trustee, or any agent of the Company or the Trustee,
from giving effect to any written certification, proxy or other authorization
furnished by any Depository (or its nominee), as a Holder, with respect to such
Security in global form or impair, as between such Depository and owners of
beneficial interests in such Security in global form, the operation of customary
practices governing the exercise of the rights of such Depository (or its
nominee) as Holder of such Security in global form.
Section 3.9. Cancellation. The Company at any time may deliver
Securities and coupons to the Trustee for cancellation. The Registrar and any
Paying Agent shall forward to the Trustee any Securities and coupons surrendered
to them for replacement, for registration of transfer, or for exchange or
payment. The Trustee shall cancel all Securities and coupons surrendered for
replacement, for registration of transfer, or for exchange, payment, redemption
or cancellation and may destroy cancelled Securities and coupons and, if so
destroyed, shall issue a certificate of destruction to the Company. The Company
may not issue new Securities to replace Securities that it has paid or delivered
to the Trustee for cancellation.
Section 3.10. Computation of Interest. Except as otherwise specified as
contemplated by Section 3.1, interest on the Securities of each series shall be
computed on the basis of a 360-day year of twelve 30-day months.
Section 3.11. Currency and Manner of Payment in Respect of Securities.
(a) Unless otherwise specified with respect to any Securities pursuant to
Section 3.1, with respect to Registered Securities of any series not permitting
the election provided for in paragraph (b) below or the Holders of which have
not made the election provided for in paragraph (b) below, and with respect to
Bearer Securities of any series, except as provided in paragraph (d) below,
payment of the principal of, premium, if any, interest, if any, and other
amounts, if any, on any Registered or Bearer Security of such series will be
made in the currency or currencies or currency unit or units in which such
Registered Security or Bearer Security, as the case may be, is payable. The
provisions of this Section 3.11, including without limitation any defined terms
specified herein, may be modified or superseded in whole or in part pursuant to
Section 3.1 with respect to any Securities.
(b) It may be provided pursuant to Section 3.1, with respect
to Registered Securities of any series, that Holders shall have the option,
subject to paragraphs (d) and (e) below, to receive payments of principal of,
premium, if any, or interest, if any, on such Registered Securities in any of
the currencies or currency units which may be designated for such election by
delivering to the Trustee (or the applicable Paying Agent) a written election
with signature guarantees and in the applicable form established pursuant to
Section 3.1, not later than the close of business on the Election Date
immediately preceding the applicable payment date. If a Holder so elects to
receive such payments in any such currency or currency unit, such election will
remain in effect for such Holder or any transferee of such Holder until changed
by such Holder or such transferee by written notice to the Trustee (or any
applicable Paying Agent) for such series of Registered Securities (but any such
change must be made not later than the close of business on the Election Date
immediately preceding the next payment date to be effective for the payment to
be made on such payment date, and no such change of election may be made with
respect to payments to be made on any Registered Security of such series with
respect to which an Event of Default has occurred or with respect to which the
Company has deposited funds pursuant to Article IV or with respect to which a
notice of redemption has been given by or on behalf of the Company). Any Holder
of any such Registered Security who shall not have delivered any such election
to the Trustee (or any applicable Paying Agent) not later than the close of
business on the applicable Election Date will be paid the amount due on the
applicable payment date in the relevant currency or currency unit as provided in
Section 3.11(a). The Trustee (or the applicable Paying Agent) shall notify the
Company and the Exchange Rate Agent as soon as practicable after the Election
Date of the aggregate principal amount of Registered Securities for which
Holders have made such written election.
(c) If the election referred to in paragraph (b) above has
been provided for with respect to any Registered Securities of a series pursuant
to Section 3.1, then, unless otherwise specified pursuant to Section 3.1 with
respect to any such Registered Securities, not later than the fourth Business
Day after the Election Date for each payment date for such Registered
Securities, the Exchange Rate Agent will deliver to the Company a written notice
specifying, in the currency or currencies or currency unit or units in which
Registered Securities of such series are payable, the respective aggregate
amounts of principal of, premium, if any, and interest, if any, on such
Registered Securities to be paid on such payment date, and specifying the
amounts in such currency or currencies or currency unit or units so payable in
respect of such Registered Securities as to which the Holders of Registered
Securities denominated in any currency or currencies or currency unit or units
shall have elected to be paid in another currency or currency unit as provided
in paragraph (b) above. If the election referred to in paragraph (b) above has
been provided for with respect to any Registered Securities of a series pursuant
to Section 3.1, and if at least one Holder has made such election, then, unless
otherwise specified pursuant to Section 3.1, on the second Business Day
preceding such payment date the Company will deliver to the Trustee (or the
applicable Paying Agent) an Exchange Rate Officers' Certificate in respect of
the Dollar, Foreign Currency or Currencies or other currency unit payments to be
made on such payment date. Unless otherwise specified pursuant to Section 3.1,
the Dollar, Foreign Currency or Currencies or other currency unit amount
receivable by Holders of Registered Securities who have elected payment in a
currency or currency unit as provided in paragraph (b) above shall be determined
by the Company on the basis of the applicable Market Exchange Rate in effect on
the second Business Day (the "Valuation Date") immediately preceding each
payment date, and such determination shall be conclusive and binding for all
purposes, absent manifest error.
(d) If a Conversion Event occurs with respect to a Foreign
Currency or any other currency unit in which any of the Securities are
denominated or payable otherwise than pursuant to an election provided for
pursuant to paragraph (b) above, then, unless otherwise specified pursuant to
Section 3.1, with respect to each date for the payment of principal of, premium,
if any, and interest, if any, on the applicable Securities denominated or
payable in such Foreign Currency or such other currency unit occurring after the
last date on which such Foreign Currency or such other currency unit was used
(the "Conversion Date"), the Dollar shall be the currency of payment for use on
each such payment date (but such Foreign Currency or such other currency unit
that was previously the currency of payment shall, at the Company's election,
resume being the currency of payment on the first such payment date preceded by
15 Business Days during which the circumstances which gave rise to the Dollar
becoming such currency of payment no longer prevail). Unless otherwise specified
pursuant to Section 3.1, the Dollar amount to be paid by the Company to the
Trustee or any applicable Paying Agent and by the Trustee or any applicable
Paying Agent to the Holders of such Securities with respect to such payment date
shall be, in the case of a Foreign Currency other than a currency unit, the
Dollar Equivalent of the Foreign Currency or, in the case of a Foreign Currency
that is a currency unit, the Dollar Equivalent of the Currency Unit, in each
case as determined by the Exchange Rate Agent in the manner provided in
paragraph (f) or (g) below.
(e) Unless otherwise specified pursuant to Section 3.1, if the
Holder of a Registered Security denominated in any currency or currency unit
shall have elected to be paid in another currency or currency unit or in other
currencies as provided in paragraph (b) above, and (i) a Conversion Event occurs
with respect to any such elected currency or currency unit, such Holder shall
receive payment in the currency or currency unit in which payment would have
been made in the absence of such election and (ii) if a Conversion Event occurs
with respect to the currency or currency unit in which payment would have been
made in the absence of such election, such Holder shall receive payment in
Dollars as provided in paragraph (d) of this Section 3.11 (but, subject to any
contravening valid election pursuant to paragraph (b) above, the elected payment
currency or currency unit, in the case of the circumstances described in clause
(i) above, or the payment currency or currency unit in the absence of such
election, in the case of the circumstances described in clause (ii) above,
shall, at the Company's election, resume being the currency or currency unit of
payment with respect to Holders who have so elected, but only with respect to
payments on payment dates preceded by 15 Business Days during which the
circumstances which gave rise to such currency or currency unit, in the case of
the circumstances described in clause (i) above, or the Dollar, in the case of
the circumstances described in clause (ii) above, becoming the currency or
currency unit, as applicable, of payment, no longer prevail).
(f) The "Dollar Equivalent of the Foreign Currency" shall be
determined by the Exchange Rate Agent and shall be obtained for each subsequent
payment date by the Exchange Rate Agent by converting the specified Foreign
Currency into Dollars at the Market Exchange Rate on the Conversion Date.
(g) The "Dollar Equivalent of the Currency Unit" shall be
determined by the Exchange Rate Agent and, subject to the provisions of
paragraph (h) below, shall be the sum of each amount obtained by converting the
Specified Amount of each Component Currency (as each such term is defined in
paragraph (h) below) into Dollars at the Market Exchange Rate for such Component
Currency on the Valuation Date with respect to each payment.
(h) For purposes of this Section 3.11, the following terms
shall have the following meanings:
A "Component Currency" shall mean any currency which, on the
Conversion Date, was a component currency of the relevant currency unit.
"Conversion Event" shall mean the cessation of use of (i) a Foreign
Currency both by the government of the country which issued such currency and
for the settlement of transactions by a central bank or other public
institutions of or within the international banking community, or (ii) any
currency unit for the purposes for which it was established.
"Election Date" shall mean the Regular Record Date for the applicable
series of Registered Securities as specified pursuant to Section 3.1 by which
the written election referred to in Section 3.11(b) may be made.
"Euro" means the lawful currency of the participating member states of
the European Union that adopt a single currency in accordance with the Treaty
establishing the European Community, as amended by the Treaty on European Union
signed February 7, 1992.
"Exchange Rate Agent", when used with respect to Securities of or
within any series, shall mean, unless otherwise specified with respect to any
Securities pursuant to Section 3.1, a New York Clearing House bank designated
pursuant to Section 3.1 or Section 3.12.
"Exchange Rate Officer's Certificate" shall mean a certificate setting
forth (i) the applicable Market Exchange Rate or the applicable bid quotation
and (ii) the Dollar or Foreign Currency amounts of principal (and premium, if
any) and interest, if any (on an aggregate basis and on the basis of a Security
having the lowest denomination principal amount in the relevant currency or
currency unit), payable with respect to a Security of any series on the basis of
such Market Exchange Rate or the applicable bid quotation, signed by the
President, the Chief Financial Officer, any Senior Vice President, the
Treasurer, any Vice President or any Assistant Treasurer of the Company.
"Foreign Currency" shall mean any currency issued by the government or
governments of one or more countries other than the United States or by any
recognized confederation or association of such governments and shall include
the Euro.
"Market Exchange Rate" shall mean, unless otherwise specified with
respect to any Securities pursuant to Section 3.1, as of any date of
determination, (i) for any conversion involving a currency unit on the one hand
and Dollars or any Foreign Currency on the other, the exchange rate between the
relevant currency unit and Dollars or such Foreign Currency calculated by the
method specified pursuant to Section 3.1 for the Securities of the relevant
series, (ii) for any conversion of Dollars into any Foreign Currency, the noon
buying rate for such Foreign Currency for cable transfers quoted in New York
City as certified for customs purposes by the Federal Reserve Bank of New York
and (iii) for any conversion of one Foreign Currency into Dollars or another
Foreign Currency, the spot rate at noon local time in the relevant market at
which, in accordance with normal banking procedures, the Dollars or Foreign
Currency into which conversion is being made could be purchased with the Foreign
Currency from which conversion is being made from major banks located in New
York City, London or any other principal market for Dollars or such purchased
Foreign Currency, in each case determined by the Exchange Rate Agent. Unless
otherwise specified with respect to any Securities pursuant to Section 3.1, in
the event of the unavailability of any of the exchange rates provided for in the
foregoing clauses (i), (ii) and (iii), the Exchange Rate Agent shall use, in its
sole discretion and without liability on its part, such quotation of the Federal
Reserve Bank of New York as of the most recent available date, or quotations
from one or more major banks in New York City, London or other principal market
for such currency or currency unit in question (which may include any such bank
acting as Trustee under this Indenture), or such other quotations as the
Exchange Rate Agent shall deem appropriate. Unless otherwise specified by the
Exchange Rate Agent, if there is more than one market for dealing in any
currency or currency unit by reason of foreign exchange regulations or
otherwise, the market to be used in respect of such currency or currency unit
shall be that upon which a nonresident issuer of securities designated in such
currency or currency unit would purchase such currency or currency unit in order
to make payments in respect of such securities.
A "Specified Amount" of a Component Currency shall mean the number of
units of such Component Currency or fractions thereof which such Component
Currency represented in the relevant currency unit on the Conversion Date. If
after the Conversion Date the official unit of any Component Currency is altered
by way of combination or subdivision, the Specified Amount of such Component
Currency shall be divided or multiplied in the same proportion. If after the
Conversion Date two or more Component Currencies are consolidated into a single
currency, the respective Specified Amounts of such Component Currencies shall be
replaced by an amount in such single currency equal to the sum of the respective
Specified Amounts of such consolidated Component Currencies expressed in such
single currency, and such amount shall thereafter be a Specified Amount and such
single currency shall thereafter be a Component Currency. If after the
Conversion Date any Component Currency shall be divided into two or more
currencies, the Specified Amount of such Component Currency shall be replaced by
specified amounts of such two or more currencies, the sum of which, at the
Market Exchange Rate of such two or more currencies on the date of such
replacement, shall be equal to the Specified Amount of such former Component
Currency and such amounts shall thereafter be Specified Amounts and such
currencies shall thereafter be Component Currencies. If, after the Conversion
Date of the relevant currency unit, a Conversion Event (other than any event
referred to above in this definition of "Specified Amount") occurs with respect
to any Component Currency of such currency unit and is continuing on the
applicable Valuation Date, the Specified Amount of such Component Currency
shall, for purposes of calculating the Dollar Equivalent of the Currency Unit,
be converted into Dollars at the Market Exchange Rate in effect on the
Conversion Date of such Component Currency.
All decisions and determinations of the Exchange Rate Agent regarding
the Dollar Equivalent of the Foreign Currency, the Dollar Equivalent of the
Currency Unit, the Market Exchange Rate and changes in the Specified Amounts as
specified above shall be in its sole discretion and shall, in the absence of
manifest error, be conclusive for all purposes and irrevocably binding upon the
Company, the Trustee (and any applicable Paying Agent) and all Holders of
Securities denominated or payable in the relevant currency, currencies or
currency units. The Exchange Rate Agent shall promptly give written notice to
the Company and the Trustee of any such decision or determination.
In the event that the Company determines in good faith that a
Conversion Event has occurred with respect to a Foreign Currency, the Company
will promptly give written notice thereof to the Trustee (or any applicable
Paying Agent) and to the Exchange Rate Agent (and the Trustee (or such Paying
Agent) will promptly thereafter give notice in the manner provided in Section
1.6 to the affected Holders) specifying the Conversion Date. In the event the
Company so determines that a Conversion Event has occurred with respect to any
currency unit in which Securities are denominated or payable, the Company will
promptly give written notice thereof to the Trustee (or any applicable Paying
Agent) and to the Exchange Rate Agent (and the Trustee (or such Paying Agent)
will promptly thereafter give notice in the manner provided in Section 1.6 to
the affected Holders) specifying the Conversion Date and the Specified Amount of
each Component Currency on the Conversion Date. In the event the Company
determines in good faith that any subsequent change in any Component Currency as
set forth in the definition of Specified Amount above has occurred, the Company
will similarly give written notice to the Trustee (or any applicable Paying
Agent) and to the Exchange Rate Agent.
The Trustee of the appropriate series of Securities shall be fully
justified and protected in relying and acting upon information received by it
from the Company and the Exchange Rate Agent and shall not otherwise have any
duty or obligation to determine the accuracy or validity of such information
independent of the Company or the Exchange Rate Agent.
Section 3.12. Appointment and Resignation of Exchange Rate Agent. (a)
Unless otherwise specified pursuant to Section 3.1, if and so long as the
Securities of any series (i) are denominated in a currency or currency unit
other than Dollars or (ii) may be payable in a currency or currency unit other
than Dollars, or so long as it is required under any other provision of this
Indenture, then the Company will maintain with respect to each such series of
Securities, or as so required, at least one Exchange Rate Agent. The Company
will cause the Exchange Rate Agent to make the necessary foreign exchange
determinations at the time and in the manner specified pursuant to Section 3.11
for the purpose of determining the applicable rate of exchange and, if
applicable, for the purpose of converting the issued currency or currencies or
currency unit or units into the applicable payment currency or currency unit for
the payment of principal, premium, if any, and interest, if any, pursuant to
Section 3.11.
(b) No resignation of the Exchange Rate Agent and no
appointment of a successor Exchange Rate Agent pursuant to this Section shall
become effective until the acceptance of appointment by the successor Exchange
Rate Agent as evidenced by a written instrument delivered to the Company and the
Trustee of the appropriate series of Securities accepting such appointment
executed by the successor Exchange Rate Agent.
(c) If the Exchange Rate Agent shall resign, be removed or
become incapable of acting, or if a vacancy shall occur in the office of the
Exchange Rate Agent for any cause, with respect to the Securities of one or more
series, the Company shall promptly appoint a successor Exchange Rate Agent or
Exchange Rate Agents with respect to the Securities of that or those series (it
being understood that any such successor Exchange Rate Agent may be appointed
with respect to the Securities of one or more or all of such series and that,
unless otherwise specified pursuant to Section 3.1, at any time there shall only
be one Exchange Rate Agent with respect to the Securities of any particular
series that are originally issued by the Company on the same date and that are
initially denominated and/or payable in the same currency or currencies or
currency unit or units).
Section 3.13. Wire Transfers. Notwithstanding any other provisions to
the contrary in this Indenture, the Company may make any payment of monies
required to be deposited with the Trustee on account of principal of, or
premium, if any, or interest on, the Securities (whether pursuant to optional or
mandatory redemption payments, interest payment or otherwise) by wire transfer
and immediately available funds to an account designated by the Trustee on or
before the date and time such monies are to be paid to the Holders of the
Security in accordance with the terms hereof.
Section 3.14. CUSIP Numbers. The Company in issuing Securities may use
"CUSIP" numbers (if then generally in use), and if so, the Trustee may use the
CUSIP numbers in notices of redemption or exchange as a convenience to Holders;
provided, however, that any such notice may state that no representation is made
as to the correctness or accuracy of the CUSIP number printed in the notice or
on the Securities, that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption or exchange shall not
be affected by any defect or omission of such CUSIP numbers. The Company will
promptly notify the Trustee of any change in CUSIP numbers known to an Officer
of the Company.
ARTICLE IV
SATISFACTION, DISCHARGE AND DEFEASANCE
Section 4.1. Termination of Company's Obligations Under the Indenture.
(a) This Indenture shall upon Company Request cease to be of further effect with
respect to Securities of or within any series and any coupons appertaining
thereto (except as to any surviving rights of registration of transfer or
exchange of such Securities and replacement of such Securities which may have
been lost, stolen or mutilated as herein expressly provided for) and the
Trustee, at the expense of the Company, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture with respect to such
Securities and any coupons appertaining thereto when
(1) either
(A) all such Securities previously authenticated and
delivered and all coupons appertaining thereto (other
than (i) such coupons appertaining to Bearer
Securities surrendered in exchange for Registered
Securities and maturing after such exchange,
surrender of which is not required or has been waived
as provided in Section 3.5, (ii) such Securities and
coupons which have been destroyed, lost or stolen and
which have been replaced or paid as provided in
Section 3.6, (iii) such coupons appertaining to
Bearer Securities called for redemption and maturing
after the relevant Redemption Date, surrender of
which has been waived as provided in Section 10.6 and
(iv) such 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 9.3) have been
delivered to the Trustee for cancellation; or
(B) all Securities of such series and, in the case of
(i) or (ii) below, any coupons appertaining thereto
not theretofore delivered to the Trustee for
cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated
Maturity within one year, or
(iii) if redeemable at the option of the Company,
are to be called for redemption within one year
under arrangements satisfactory to the Trustee
for giving of notice of redemption by the
Trustee in the name, and at the expense, of the
Company, and the Company, in the case of (i),
(ii) or (iii) above, has irrevocably deposited
or caused to be deposited with the Trustee as
trust funds in trust for the purpose an amount
in the currency or currencies or currency unit
or units in which the Securities of such series
are payable, sufficient to pay and discharge the
entire indebtedness on such Securities and such
coupons not theretofore delivered to the Trustee
for cancellation, for principal, premium, if
any, and interest, with respect thereto, 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 then 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
as to such series have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligation of the Company to the Trustee and any predecessor Trustee under
Section 6.8, the obligations of the Company to any Authenticating Agent under
Section 6.13 and, if money shall have been deposited with the Trustee pursuant
to subclause (B) of clause (1) of this Section, the obligations of the Trustee
under Section 4.2 and the last paragraph of Section 9.3 shall survive.
Section 4.2. Application of Trust Funds. Subject to the provisions of
the last paragraph of Section 9.3, 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) as the Trustee may determine, to the Persons entitled thereto,
of the principal, premium, if any and any interest for whose payment such money
has been deposited with or received by the Trustee, but such money need not be
segregated from other funds except to the extent required by law.
Section 4.3. Applicability of Defeasance Provisions; Company's Option
to Effect Defeasance or Covenant Defeasance. Unless pursuant to Section 3.1
provision is made to exclude with respect to the Securities of a particular
series either or both of (i) defeasance of the Securities of or within such
series under Section 4.4 or (ii) covenant defeasance of the Securities of or
within such series under Section 4.5, then the provisions of such Section or
Sections, as the case may be, together with the provisions of Sections 4.6
through 4.9 inclusive, with such modifications thereto as may be specified
pursuant to Section 3.1 with respect to any Securities of such series, shall be
applicable to such Securities and any coupons appertaining thereto, and the
Company may at its option, at any time, with respect to such Securities and any
coupons appertaining thereto, elect to have Section 4.4 (if applicable) or
Section 4.5 (if applicable) be applied to such Outstanding Securities and any
coupons appertaining thereto upon compliance with the conditions set forth below
in this Article.
Section 4.4. Defeasance and Discharge. Upon the Company's exercise of
the option specified in Section 4.3 applicable to this Section with respect to
the Securities of or within a series, the Company shall be deemed to have been
discharged from its obligations with respect to such Securities and any coupons
appertaining thereto on the date the conditions set forth in Section 4.6 are
satisfied (hereinafter, a "defeasance"). For this purpose, such defeasance means
that the Company shall be deemed to have paid and discharged the entire
indebtedness represented by such Securities and any coupons appertaining
thereto, which Securities and coupons appertaining thereto shall thereafter be
deemed to be "Outstanding" only for the purposes of Section 4.7 and the other
Sections of this Indenture referred to in clause (ii) of this Section, and to
have satisfied all its other obligations under such Securities and any coupons
appertaining thereto and this Indenture insofar as such Securities and any
coupons appertaining thereto are concerned (and the Trustee, at the expense of
the Company, shall on Company Order execute proper instruments acknowledging the
same), except the following which shall survive until otherwise terminated or
discharged hereunder: (i) the rights of Holders of such Securities and any
coupons appertaining thereto to receive, solely from the trust funds described
in Section 4.6(a) and as more fully set forth in such Section, payments in
respect of the principal of, premium, if any, and interest, if any, on such
Securities or any coupons appertaining thereto when such payments are due; (ii)
the Company's obligations with respect to such Securities under Sections 3.5,
3.6, 9.2 and 9.3 and with respect to the payment of additional amounts, if any,
payable with respect to such Securities as specified pursuant to Section 3.1(b)
(18); (iii) the rights, powers, trusts, duties and immunities of the Trustee
hereunder and (iv) this Article IV. Subject to compliance with this Article IV,
the Company may exercise its option under this Section notwithstanding the prior
exercise of its option under Section 4.5 with respect to such Securities and any
coupons appertaining thereto. Following a defeasance, payment of such Securities
may not be accelerated because of an Event of Default.
Section 4.5. Covenant Defeasance. Upon the Company's exercise of the
option specified in Section 4.3 applicable to this Section with respect to any
Securities of or within a series, the Company shall be released from its
obligations under Sections 7.1, 9.4 and 9.5, and, if specified pursuant to
Section 3.1, its obligations under any other covenant, with respect to such
Securities and any coupons appertaining thereto on and after the date the
conditions set forth in Section 4.6 are satisfied (hereinafter, "covenant
defeasance"), and such Securities and any coupons appertaining thereto shall
thereafter be deemed to be not "Outstanding" for the purposes of any direction,
waiver, consent or declaration or Act of Holders (and the consequences of any
thereof) in connection with Sections 7.1, 9.4 and 9.5, or such other covenant,
but shall continue to be deemed "Outstanding" for all other purposes hereunder.
For this purpose, such covenant defeasance means that, with respect to such
Securities and any coupons appertaining thereto, the Company may omit to comply
with and shall have no liability in respect of any term, condition or limitation
set forth in any such Section or such other covenant, whether directly or
indirectly, by reason of any reference elsewhere herein to any such Section or
such other covenant or by reason of reference in any such Section or such other
covenant to any other provision herein or in any other document and such
omission to comply shall not constitute a Default or an Event of Default under
Section 5.1(3) or 5.1(6) or otherwise, as the case may be, but, except as
specified above, the remainder of this Indenture and such Securities and any
coupons appertaining thereto shall be unaffected thereby.
Section 4.6. Conditions to Defeasance or Covenant Defeasance. The
following shall be the conditions to application of Section 4.4 or Section 4.5
to any Securities of or within a series and any coupons appertaining thereto:
(a) The Company shall have deposited or caused to be
deposited irrevocably with the Trustee (or another
trustee satisfying the requirements of Section 6.11 who
shall agree to comply with, and shall be entitled to
the benefits of, the provisions of Sections 4.3 through
4.9 inclusive and the last paragraph of Section 9.3
applicable to the Trustee, for purposes of such
Sections also a "Trustee") as trust funds in trust for
the purpose of making the payments referred to in
clauses (x) and (y) of this Section 4.6(a),
specifically pledged as security for, and dedicated
solely to, the benefit of the Holders of such
Securities and any coupons appertaining thereto, with
instructions to the Trustee as to the application
thereof, (A) money in an amount (in such currency,
currencies or currency unit in which such Securities
and any coupons appertaining thereto are then specified
as payable at Maturity), or (B) if Securities of such
series are not subject to repayment at the option of
Holders, Government Obligations which through the
payment of interest and principal in respect thereof in
accordance with their terms will provide, not later
than one day before the due date of any payment
referred to in clause (x) or (y) of this Section
4.6(a), money in an amount or (C) a combination thereof
in an amount, sufficient, in the opinion of a
nationally recognized independent accounting or
investment banking firm expressed in a written
certification thereof delivered to the Trustee, to pay
and discharge, and which shall be applied by the
Trustee to pay and discharge, (x) the principal of,
premium, if any, and interest, if any, on such
Securities and any coupons appertaining thereto on the
Maturity of such principal or installment of principal
or interest and (y) any mandatory sinking fund payments
applicable to such Securities on the day on which such
payments are due and payable in accordance with the
terms of this Indenture and such Securities and any
coupons appertaining thereto. Before such a deposit the
Company may make arrangements satisfactory to the
Trustee for the redemption of Securities at a future
date or dates in accordance with Article X which shall
be given effect in applying the foregoing.
(b) Such defeasance or covenant defeasance shall not result
in a breach or violation of, or constitute a Default or
Event of Default under, this Indenture or result in a
breach or violation of, or constitute a default under,
any other material agreement or instrument to which the
Company is a party or by which it is bound.
(c) In the case of an election under Section 4.4, no
Default or Event of Default under Section 5.1(4) or
5.1(5) with respect to such Securities and any coupons
appertaining thereto shall have occurred and be
continuing during the period commencing on the date of
such deposit and ending on the 91st day after such date
(it being understood that this condition shall not be
deemed satisfied until the expiration of such period).
(d) In the case of an election under Section 4.4, the
Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel to the
effect that (i) the Company has received from, or there
has been published by, the Internal Revenue Service a
ruling, or (ii) since the date of execution of this
Indenture, there has been a change in the applicable
Federal income tax law, in either case to the effect
that, and based thereon such opinion shall confirm
that, the Holders of such Securities and any coupons
appertaining thereto will not recognize income, gain or
loss for Federal income tax purposes as a result of
such defeasance and will be subject to Federal income
tax on the same amounts and in the same manner and at
the same times, as would have been the case if such
deposit, defeasance and discharge had not occurred.
(e) In the case of an election under Section 4.5, the
Company shall have delivered to the Trustee an Opinion
of Counsel to the effect that the Holders of such
Securities and any coupons appertaining thereto will
not recognize income, gain or loss for Federal income
tax purposes as a result of such covenant defeasance
and will be subject to Federal income tax on the same
amounts, in the same manner and at the same times as
would have been the case if such covenant defeasance
had not occurred.
(f) The Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each
stating that all conditions precedent to the defeasance
under Section 4.4 or the covenant defeasance under
Section 4.5 (as the case may be) have been complied
with and an Opinion of Counsel to the effect that
either (i) as a result of a deposit pursuant to
subsection (a) above and the related exercise of the
Company's option under Section 4.4 or Section 4.5 (as
the case may be), registration is not required under
the Investment Company Act of 1940, as amended, by the
Company, with respect to the trust funds representing
such deposit or by the trustee for such trust funds or
(ii) all necessary registrations under said act have
been effected.
(g) Such defeasance or covenant defeasance shall be
effected in compliance with any additional or
substitute terms, conditions or limitations which may
be imposed on the Company in connection therewith as
contemplated by Section 3.1.
Section 4.7. Deposited Money and Government Obligations to Be Held in
Trust. Subject to the provisions of the last paragraph of Section 9.3, all money
and Government Obligations (or other property as may be provided pursuant to
Section 3.1) (including the proceeds thereof) deposited with the Trustee
pursuant to Section 4.6 in respect of any Securities of any series and any
coupons appertaining thereto shall be held in trust and applied by the Trustee,
in accordance with the provisions of such Securities and any coupons
appertaining thereto and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as its own Paying Agent)
as the Trustee may determine, to the Holders of such Securities and any coupons
appertaining thereto of all sums due and to become due thereon in respect of
principal, premium, if any, and interest, if any, but such money need not be
segregated from other funds except to the extent required by law.
Unless otherwise specified with respect to any Security pursuant to
Section 3.1, if, after a deposit referred to in Section 4.6(a) has been made,
(i) the Holder of a Security in respect of which such deposit was made is
entitled to, and does, elect pursuant to Section 3.11(b) or the terms of such
Security to receive payment in a currency or currency unit other than that in
which the deposit pursuant to Section 4.6(a) has been made in respect of such
Security, or (ii) a Conversion Event occurs as contemplated in Section 3.11(d)
or 3.11(e) or by the terms of any Security in respect of which the deposit
pursuant to Section 4.6(a) has been made, the indebtedness represented by such
Security and any coupons appertaining thereto shall be deemed to have been, and
will be, fully discharged and satisfied through the payment of the principal of,
premium, if any, and interest, if any, on such Security as the same becomes due
out of the proceeds yielded by converting (from time to time as specified below
in the case of any such election) the amount or other property deposited in
respect of such Security into the currency or currency unit in which such
Security becomes payable as a result of such election or Conversion Event based
on the applicable Market Exchange Rate for such currency or currency unit in
effect on the second Business Day prior to each payment date, except, with
respect to a Conversion Event, for such currency or currency unit in effect (as
nearly as feasible) at the time of the Conversion Event.
Section 4.8. Repayment to Company. The Trustee (and any Paying Agent)
shall promptly pay to the Company upon Company Request any excess money or
securities held by them at any time.
Section 4.9. Indemnity for Government Obligations. The Company shall
pay, and shall indemnify the Trustee against, any tax, fee or other charge
imposed on or assessed against Government Obligations deposited pursuant to this
Article or the principal and interest received on such Government Obligations,
other than any such tax, fee or other charge that by law is for the account of
the Holders of the Securities subject to defeasance or covenant defeasance
pursuant to this Article.
ARTICLE V
DEFAULTS AND REMEDIES
Section 5.1. Events of Default. An "Event of Default" occurs with
respect to the Securities of any series, except to the extent such event is
specifically deleted or modified as contemplated by Section 3.1 for the
Securities of such series, if (whatever the reason for such Event of Default and
whether it shall be voluntary or involuntary or be effected by operation of law
or pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):
(1) the Company defaults in the payment of interest on
any Security of that series or any coupon
appertaining thereto or any additional amount payable
with respect to any Security of that series as
specified pursuant to Section 3.1(b)(17) when the
same becomes due and payable and such default
continues for a period of 30 days;
(2) the Company defaults in the payment of the principal
of or any premium on any Security of that series when
the same becomes due and payable at its Maturity or
on redemption or otherwise, or in the payment of a
mandatory sinking fund payment when and as due by the
terms of the Securities of that series;
(3) the Company defaults in the performance of, or
breaches, any covenant or warranty of the Company in
this Indenture with respect to any Security of that
series (other than a covenant or warranty a default
in whose performance or whose breach is elsewhere in
this Section specifically dealt with), and such
default or breach continues for a period of 90 days
after there has been given, by registered or
certified mail, to the Company by the Trustee or to
the Company and the Trustee by the Holders of at
least 25% in principal amount of the Outstanding
Securities of that series, a written notice
specifying such default or breach and requiring it to
be remedied and stating that such notice is a "Notice
of Default" hereunder;
(4) the Company pursuant to or within the meaning of any
Bankruptcy Law (A) commences a voluntary case, (B)
consents to the entry of an order for relief against
it in an involuntary case, (C) consents to the
appointment of a Custodian of it or for all or
substantially all of its property, or (D) makes a
general assignment for the benefit of its creditors;
(5) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that (A) is for
relief against the Company in an involuntary case,
(B) appoints a Custodian of the Company or for all or
substantially all of its property, or (C) orders the
liquidation of the Company; and the order or decree
remains unstayed and in effect for 90 days; or
(6) any other Event of Default provided as contemplated
by Section 3.1 with respect to Securities of that
series.
The term "Bankruptcy Law" means Title 11, U.S. Code,
or any similar federal or state law for the relief of
debtors. The term "Custodian" means any receiver,
trustee, assignee, liquidator or similar official
under any Bankruptcy Law.
Section 5.2. Acceleration; Rescission and Annulment. If an Event of
Default with respect to the Securities of any series at the time Outstanding
occurs and is continuing, the Trustee or the Holders of at least 25% in
aggregate principal amount of all of the Outstanding Securities of that series,
by written notice to the Company (and, if given by the Holders, to the Trustee),
may declare the principal (or, if the Securities of that series are Original
Issue Discount Securities or Indexed Securities, such portion of the principal
amount or other amount as may be specified in the terms of that series) of all
the Securities of that series to be due and payable and upon any such
declaration such principal (or, in the case of Original Issue Discount
Securities or Indexed Securities, such specified amount) shall be immediately
due and payable.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the Holders of a majority in aggregate principal amount of the
Outstanding Securities of that series, by written notice to the Trustee, may
rescind and annul such declaration and its consequences if all existing Defaults
and Events of Default with respect to Securities of that series, other than the
non-payment of the principal of Securities of that series which have become due
solely by such declaration of acceleration, have been cured or waived as
provided in Section 5.7. No such rescission 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 on any
Security or coupon, if any, when such interest
becomes due and payable and such default continues
for a period of 30 days, or
(2) default is made in the payment of the principal of
(or premium, if any, on) any Security at the Maturity
thereof and such default continues for a period of 10
days,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities or coupons, if any, the whole amount then due and
payable on such Securities for principal, premium, if any, and interest and, to
the extent that payment of such interest shall be legally enforceable, interest
on any overdue principal, premium, if any, and on any overdue interest, at the
rate or rates prescribed therefor in such Securities or coupons, if any, 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 principal, premium, if any, and
interest 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 such principal, premium, if any, and interest amounts so due and
unpaid, may prosecute such proceeding to judgment or final decree and may
enforce the same against the Company.
In addition, if an Event of Default with respect to Securities of any
series occurs and is continuing, the Trustee may in its discretion proceed, in
its own name and as trustee of an express trust, to protect and enforce its
rights and the rights of the Holders of Securities of such series by such
appropriate judicial proceedings as the Trustee shall deem most effectual to
protect and enforce any such rights, 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. The Trustee may file
such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee and the Holders of
Securities allowed in any judicial proceedings relating to the Company, its
creditors or its property.
Section 5.5. Trustee May Enforce Claims Without Possession of
Securities. All rights of action and claims under this Indenture or the
Securities may be prosecuted and enforced by the Trustee, in its own name and as
trustee of an express trust, without the possession of any of the Securities or
the production thereof in any proceeding relating thereto.
Section 5.6. Delay or Omission Not Waiver. No delay or omission by the
Trustee or any Holder of any Securities to exercise any right or remedy accruing
upon an Event of Default shall impair any such right or remedy or constitute a
waiver of or acquiescence in any such Event of Default.
Section 5.7. Waiver of Past Defaults. The Holders of a majority in
aggregate principal amount of Outstanding Securities of any series by notice to
the Trustee may waive on behalf of the Holders of all Securities of such series
a past Default or Event of Default with respect to that series and its
consequences except a Default or Event of Default (i) in the payment of the
principal of, premium, if any, or interest on any Security of such series or any
coupon appertaining thereto or (ii) in respect of a covenant or provision hereof
which pursuant to Section 8.2 cannot be amended or modified without the consent
of the Holder of each Outstanding Security of such series adversely 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 Event of Default or impair any right consequent thereon. In case of
any such waiver, the Company, the Trustee and the Holders shall be restored to
their former positions and rights hereunder and under the Securities of such
series, respectively.
Section 5.8. Control by Majority. The Holders of a majority in
aggregate principal amount of the Outstanding Securities of each series affected
(with each such series voting as a class) 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 it with respect to
Securities of that series; provided, however, that (i) the Trustee may refuse to
follow any direction that conflicts with law or this Indenture, (ii) the Trustee
may refuse to follow any direction that is unduly prejudicial to the rights of
the Holders of Securities of such series not consenting, or that would in the
good faith judgment of the Trustee have a substantial likelihood of involving
the Trustee in personal liability and (iii) the Trustee may take any other
action deemed proper by the Trustee which is not inconsistent with such
direction.
Section 5.9. Limitation on Suits by Holders. No Holder of any Security
of any series or any coupons appertaining thereto 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) the Holder has previously given written notice to the
Trustee of a continuing Event of Default with respect
to the Securities of that series;
(2) the Holders of at least 25% in aggregate principal
amount of the Outstanding Securities of that series
have made a 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
indemnity satisfactory to the Trustee against any
loss, liability or expense to be, or which may be,
incurred by the Trustee in pursuing the remedy;
(4) the Trustee for 60 days after its receipt of such
notice, request and the offer of indemnity has failed
to institute any such proceedings; and
(5) during such 60 day period, the Holders of a majority
in aggregate principal amount of the Outstanding
Securities of that series have not given to the
Trustee a direction inconsistent with such written
request.
No one or more Holders shall have any right in any
manner whatever by virtue of, or by availing of, any
provision of this Indenture to affect, disturb or
prejudice the rights of any other of such Holders, or
to obtain or to seek to obtain priority or preference
over any other of such Holders or to enforce any
right under this Indenture, except in the manner
herein provided and for the equal and ratable benefit
of all of such Holders.
Section 5.10. Rights of Holders to Receive Payment. Notwithstanding any
other provision of this Indenture, but subject to Section 9.2, the right of any
Holder of a Security or coupon to receive payment of principal of, premium, if
any, and, subject to Sections 3.5 and 3.7, interest on the Security, on or after
the respective due dates expressed in the Security (or, in case of redemption,
on the redemption dates), and the right of any Holder of a coupon to receive
payment of interest due as provided in such coupon, or to bring suit for the
enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of such Holder.
Section 5.11. Application of Money Collected. If the Trustee collects
any money pursuant to this Article, it shall pay out the money 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 and the notation thereon of the
payment if only partially paid and upon surrender thereof if fully paid:
First: to the Trustee for amounts due under Section 6.8;
Second: Subject to the terms of any subordination entered into
as contemplated by Section 3.1(b) (27) hereof, to Holders of
Securities and coupons in respect of which or for the benefit
of which such money has been collected for amounts due and
unpaid on such Securities for principal of, premium, if any,
and interest, ratably, without preference or priority of any
kind, according to the amounts due and payable on such
Securities for principal, premium, if any, and interest,
respectively; and
Third: The balance, if any, to the Company or any other Person or
Persons entitled thereto.
The Trustee may fix a record date and payment date for any payment to
Holders pursuant to this Section 5.11. At least 15 days before such record date,
the Trustee shall mail to each Holder and the Company a notice that states the
record date, the payment date and the amount to be paid.
Unless otherwise specified in the Supplemental Indenture with respect
to a Series of Securities, in any case where Securities are outstanding which
are denominated in more than one currency, or in a composite currency and at
least one other currency, and the Trustee is directed to make ratable payments
under this Section to Holders of Securities, the Trustee shall calculate the
amount of such payments as follows: (i) as of the day the Trustee collects an
amount under this Article, the Trustee shall, as to each Holder of a Security to
whom an amount is due and payable under this Section which is denominated in a
foreign currency or a composite currency, determine that amount of U.S. Dollars
that would be obtained for the amount owing such Holder, using the rate of
exchange at which in accordance with normal banking procedures the Trustee could
purchase in The City of New York U.S. Dollars with such amount owing, (ii)
calculate the sum of all U.S. Dollar amounts determined under (i) and add
thereto any amounts due and payable in U.S. Dollars; and (iii) using the
individual amounts determined in (i) or any individual amounts due and payable
in U.S. Dollars, as the case may be, as a numerator and the sum calculated in
(ii) as a denominator, calculate as to each Holder of a Security to whom an
amount is owed under this Section the fraction of the amount collected under
this Article payable to such Holder. Any expenses incurred by the Trustee in
actually converting amounts owing Holders of Securities denominated in a
currency or composite currency other than that in which any amount is collected
under this Article shall be likewise (in accordance with this paragraph) be
borne ratably by all Holders of Securities to whom amounts are payable under
this Section.
Unless otherwise specified in the Supplemental Indenture with respect
to a Series of Securities, to the fullest extent allowed under applicable law,
if for the purpose of obtaining judgment against the Company in any court it is
necessary to convert the sum due in respect of the principal of, or any premium
or interest on the Securities of any series (the "Required Currency") into a
currency in which judgment will be rendered (the "Judgment Currency"), the rate
of exchange used shall be the rate at which in accordance with normal banking
procedures the Trustee could purchase in The City of New York the Required
Currency with the Judgment Currency on the New York Business Day preceding that
on which final judgment is given. The Company shall not be liable for any
shortfall nor shall it benefit from any windfall in payments to Holders of
Securities under this Section caused by a change in exchange rates between the
time the amount of a judgment against it is calculated as above and the time the
Trustee converts the Judgment Currency into the Required Currency to make
payments under this Section to Holders of Securities, but payment of such
judgment shall discharge all amounts owed by the Company on the claim or claims
underlying such judgment.
Section 5.12. Restoration of Rights and Remedies. If the Trustee or any
Holder has instituted any proceeding to enforce any right or remedy under this
Indenture and such proceeding has been discontinued or abandoned for any reason,
or has been determined adversely to the Trustee or to such Holder, then and in
every such case, subject to any determination in such proceeding, the Company,
the Trustee and the Holders shall be restored severally and respectively to
their former positions hereunder and thereafter all rights and remedies of the
Trustee and the Holders shall continue as though no such proceeding had been
instituted.
Section 5.13. Rights and Remedies Cumulative. Except as otherwise
provided with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Securities in the last paragraph of Section 3.6, no right or
remedy herein conferred upon or reserved to the Trustee or the Holders is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition 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 5.14. Waiver of Stay, Extension or Usury 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 or extension law or any usury or other similar
law wherever enacted, now or at any time hereafter in force, that would prohibit
or forgive the Company from paying all or any portion of the principal of (or
premium, if any) or interest on the Securities contemplated herein or in the
Securities or that may affect the covenants or the performance of this
Indenture; and the Company (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
will not hinder, delay or impede the execution of any power herein granted to
the Trustee, but will suffer and permit the execution of every such power as
though no such law had been enacted.
ARTICLE VI
THE TRUSTEE
Section 6.1. Rights of Trustee. Subject to the provisions of the Trust
Indenture Act:
(a) The Trustee may conclusively rely and shall be
protected in acting or refraining from acting upon
any document believed by it to be genuine and to have
been signed or presented by the proper party or
parties. The Trustee need not investigate any fact or
matter stated in the document.
(b) Any request or direction of the Company mentioned
herein shall be sufficiently evidenced by a Company
Request or Company Order (other than delivery of any
Security, together with any coupons appertaining
thereto, to the Trustee for authentication and
delivery pursuant to Section 3.3, which shall be
sufficiently evidenced as provided therein) and any
resolution of the Board of Directors may be
sufficiently evidenced by a Board Resolution.
(c) Before the Trustee acts or refrains from acting, it
may consult with counsel or require an Officers'
Certificate. The Trustee shall not be liable for any
action it takes or omits to take in good faith in
reliance on a Board Resolution, the written advice of
counsel acceptable to the Company and the Trustee, a
certificate of an Officer or Officers delivered
pursuant to Section 1.2, an Officers' Certificate or
an Opinion of Counsel.
(d) The Trustee may act through agents or attorneys and
shall not be responsible for the misconduct or
negligence of any agent or attorney appointed with
due care.
(e) The Trustee shall not be liable for any action it
takes or omits to take in good faith which it
believes to be authorized or within its discretion or
rights or powers.
(f) The Trustee shall not be required 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 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.
Notwithstanding anything contained herein to the contrary, in case an
Event of Default with respect to the Securities of any series has occurred and
is continuing, the Trustee shall exercise, with respect to Securities of such
series, such of the rights and powers vested in it by this Indenture, and shall
use the same degree of care and skill in their exercise, as a prudent individual
would exercise or use under the circumstances in the conduct of his or her own
affairs.
Section 6.2. Trustee May Hold Securities. The Trustee, any Paying
Agent, any Registrar or any other agent of the Company, in its individual or any
other capacity, may become the owner or pledgee of Securities and coupons and,
subject to Sections 310(b) and 311 of the Trust Indenture Act, may otherwise
deal with the Company, an Affiliate or Subsidiary with the same rights it would
have if it were not Trustee, Paying Agent, Registrar or such other agent.
Section 6.3. Money Held in Trust. Subject to the provisions of Section
4.8 and the last paragraph of Section 9.3, all moneys received by the Trustee
shall, until used or applied as herein provided, be held in trust for the
purposes for which they were received, but need not be segregated from other
funds except to the extent required by law. The Trustee shall be under no
liability for investment of or interest on any money received by it hereunder
except as otherwise agreed with the Company. Except for amounts deposited
pursuant to Article Thirteen, so long as no Event of Default shall have occurred
and be continuing, all interest allowed on any such moneys shall be paid from
time to time to the Company upon a Company Order. Money held by the Trustee in
trust hereunder need not be segregated from other funds except to the extent
required by law.
Section 6.4. Trustee's Disclaimer. The recitals contained herein and in
the Securities, except the Trustee's certificate of authentication, shall be
taken as the statements of the Company, and the Trustee assumes no
responsibility for their correctness. The Trustee makes no representation as to
the validity or adequacy of this Indenture or the Securities or any coupon,
except that the Trustee represents and warrants that it is duly authorized to
execute and deliver this Indenture, authenticate the Securities and perform its
obligations hereunder and thereunder; that the statements made by it in a
Statement of Eligibility and Qualification on Form T-1 supplied or to be
supplied to the Company in connection with the registration of any Securities
are and will be true and accurate subject to the qualifications set forth
therein; and that such Statement complies and will comply in all material
respects with the requirements of the Trust Indenture Act and the Securities
Act. The Trustee shall not be accountable for the Company's use of the proceeds
from the Securities or for monies paid over to the Company pursuant to the
Indenture.
Section 6.5. Notice of Defaults. If a Default occurs and is continuing
with respect to the Securities of any series and if it is known to the Trustee,
the Trustee shall, within 90 days after it occurs, transmit, in the manner and
to the extent provided in Section 313(c) of the Trust Indenture Act, notice of
all uncured Defaults known to it; provided, however, that, except in the case of
a Default in payment on the Securities of any series, the Trustee may withhold
the notice if and so long as a Responsible Officer in good faith determines that
withholding such notice is in the interests of Holders of Securities of that
series; provided, further, that in the case of any default or breach of the
character specified in Section 5.1(3) with respect to the Securities and coupons
of such series, no such notice to Holders shall be given until at least 90 days
after the occurrence thereof.
Section 6.6. Reports by Trustee to Holders. (a) Within 60 days after
each May 15 of each year commencing with the first May 15 after the first
issuance of Securities pursuant to this Indenture, the Trustee shall transmit by
mail to all Holders of Securities as provided in Section 313(c) of the Trust
Indenture Act a brief report dated as of such May 15 if required by and in
compliance with Section 313(a) of the Trust Indenture Act. A copy of each report
shall, at the time of such transmission to Holders, be filed by the Trustee with
each stock exchange, if any, upon which the Securities are listed, with the
Commission and with the Company. The Company will promptly notify the Trustee
when the Securities are listed on any stock exchange and of any delisting
thereof.
(b) The Trustee shall from time to time transmit by mail to
all Holders of Securities as provided in Section 313(c) of the Trust Indenture
Act, such reports as are required to be filed pursuant to Section 313(b) of the
Trust Indenture Act.
Section 6.7. Security Holder Lists. The Trustee shall preserve in as
current a form as is reasonably practicable the most recent list available to it
of the names and addresses of Holders of Securities of each series. If the
Trustee is not the Registrar, the Company shall furnish to the Trustee
semiannually on or before the last day of June and December in each year, and at
such other times as the Trustee may request in writing, a list, in such form and
as of such date as the Trustee may reasonably require, containing all the
information in the possession or control of the Registrar, the Company or any of
its Paying Agents other than the Trustee as to the names and addresses of
Holders of Securities of each such series. If there are Bearer Securities of any
series Outstanding, even if the Trustee is the Registrar, the Company shall
furnish to the Trustee such a list containing such information with respect to
Holders of such Bearer Securities only.
Section 6.8. Compensation and Indemnity. (a) The Company shall pay to
the Trustee from time to time such reasonable compensation for its services as
the Company and the Trustee may agree in writing from time to time. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee upon
request for all reasonable expenses, disbursements and advances incurred by it
in connection with the performance of its duties under this Indenture, except
any such expense, disbursement or advance as may be attributable to its
negligence or bad faith. Such expenses shall include the reasonable compensation
and expenses of the Trustee's agents and counsel.
(b) The Company shall indemnify the Trustee for, and hold it
harmless against, any and all loss, liability, damage, claim or expense
(including taxes other than taxes based upon, measured by or determined by the
income of the Trustee), including the costs and expenses of defending itself
against any third-party claim (whether asserted by any Holder or any other
Person (other than the Company)), incurred by it arising out of or in connection
with its acceptance or administration of the trust or trusts hereunder
(collectively, "Claims"). The Trustee shall notify the Company promptly of any
Claim for which it may seek indemnity. The Company shall defend the Claim and
the Trustee shall cooperate in the defense. The Trustee may have separate
counsel and the Company shall pay the reasonable fees and expenses of such
counsel. The Company need not pay for any settlement made without its consent.
(c) The Company need not reimburse any expense, disbursement
or advance or indemnify against any Claim incurred by the Trustee through
negligence or bad faith.
(d) To secure the payment obligations of the Company pursuant
to this Section, the Trustee shall have a lien prior to the Securities of any
series on all money or property held or collected by the Trustee, except that
held in trust to pay principal, premium, if any, and interest on particular
Securities.
(e) When the Trustee incurs expenses or renders services in
connection with an Event of Default specified in Section 5.1(4) or Section
5.1(5), the expenses (including the reasonable charges and expenses of its
counsel) and the compensation for the services are intended to constitute
expenses of administration under any applicable federal or state bankruptcy,
insolvency or other similar law.
(f) The provisions of this Section shall survive the
termination of this Indenture.
Section 6.9. Replacement of Trustee. (a) The resignation or removal of
the Trustee and the appointment of a successor Trustee shall become effective
only upon the successor Trustee's acceptance of appointment as provided in
Section 6.10.
(b) The Trustee may resign at any time with respect to the
Securities of any series 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 with respect to the
Securities of such series.
(c) The Holders of a majority in aggregate principal amount of
the Outstanding Securities of any series may remove the Trustee with respect to
that series by so notifying the Trustee and the Company in writing and may
appoint a successor Trustee for such series with the Company's consent.
If an 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 Trustee being removed may petition any
court of competent jurisdiction for the appointment of a successor Trustee with
respect to the Securities of such series.
(d) If at any time:
(1) the Trustee fails to comply with Section
310(b) of the Trust Indenture Act after
written request therefor by the Company or
by any Holder who has been a bona fide
Holder of a Security for at least six
months, or
(2) the Trustee shall cease to be eligible under
Section 6.11 hereof or Section 310(a) of the
Trust Indenture Act 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
(3) the Trustee becomes incapable of acting, is
adjudged a bankrupt or an insolvent or a
receiver or public officer takes charge of
the Trustee or its property or affairs for
the purpose of rehabilitation, conservation
or liquidation,
then, in any such case, (i) the Company may remove the Trustee with respect to
all Securities, or (ii) subject to Section 315(e) of the Trust Indenture Act,
any Holder who has been a bona fide Holder of a Security for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Trustee with respect to all
Securities and the appointment of a successor Trustee or Trustees.
(e) If the Trustee resigns or is removed or becomes incapable
of acting or if a vacancy exists in the office of Trustee for any reason, with
respect to Securities of one or more series, the Company shall promptly appoint
a successor Trustee with respect to the Securities of that or those series (it
being understood that any such successor Trustee may be appointed with respect
to the Securities of one or more or all of such series and that at any time
there shall be only one Trustee with respect to the Securities of any particular
series) and shall comply with the applicable requirements of Section 6.10. If,
within one year after such resignation, removal or incapability, or the
occurrence of such vacancy, a successor Trustee with respect to the Securities
of any series shall be appointed by Act of the Holders of a majority in
principal amount of the Outstanding Securities of such series delivered to the
Company and the retiring Trustee, the successor Trustee so appointed shall,
forthwith upon its acceptance of such appointment in accordance with the
applicable requirements of Section 6.10, become the successor Trustee with
respect to the Securities of such series and to that extent supersede the
successor Trustee appointed by the Company. If no successor Trustee with respect
to the Securities of any series shall have been so appointed by the Company or
the Holders and accepted appointment in the manner required by Section 6.10,
then, subject to Section 315(e) of the Trust Indenture Act, any Holder who has
been a bona fide Holder of a Security of such series for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the appointment of a successor Trustee with
respect to the Securities of such series.
Section 6.10. Acceptance of Appointment by Successor. (a) In case of
the appointment hereunder of a successor Trustee with respect to all Securities,
every such successor Trustee shall execute, acknowledge and deliver to the
Company and to the retiring Trustee an instrument accepting such appointment.
Thereupon, the resignation or removal of the retiring Trustee shall become
effective, and the successor Trustee, without further act, deed or conveyance,
shall become vested with all the rights, powers 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.
(b) In case of the appointment hereunder of a successor
Trustee with respect to the Securities of one or more (but not all) series, the
Company, the retiring Trustee and such successor Trustee shall execute and
deliver an indenture supplemental hereto wherein such successor Trustee shall
accept such appointment and which (i) shall contain such provisions as shall be
necessary or desirable to transfer and confirm to, and to vest in, such
successor Trustee all the rights, powers, trusts and duties of the retiring
Trustee with respect to the Securities of that or those series to which the
appointment of such successor Trustee relates, (ii) if the retiring Trustee is
not retiring with respect to all Securities, shall contain such provisions as
shall be deemed necessary or desirable to confirm that all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of that
or those series as to which the retiring Trustee is not retiring shall continue
to be vested in the retiring Trustee, and (iii) shall add to or change any of
the provisions of this Indenture as shall be necessary to provide for or
facilitate the administration of the trusts hereunder by more than one Trustee,
it being understood that nothing herein or in such supplemental indenture shall
constitute such Trustees co-trustees of the same trust and that each such
Trustee shall be trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Trustee and upon
the execution and delivery of such supplemental indenture the resignation or
removal of the retiring Trustee shall become effective to the extent provided
therein and each such successor Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties
of the retiring Trustee with respect to the Securities of that or those series
to which the appointment of such successor Trustee relates; but, on request of
the Company or any successor Trustee, such retiring Trustee shall duly assign,
transfer and deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder with respect to the Securities of that or those
series to which the appointment of such successor Trustee relates.
(c) Upon request of any such successor Trustee, the Company
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Trustee all such rights, powers and trusts
referred to in paragraph (a) or (b) of this Section, as the case may be.
(d) No successor Trustee shall accept its appointment unless
at the time of such acceptance such successor Trustee shall be qualified and
eligible under the Trust Indenture Act.
(e) The Company shall give notice of each resignation and each
removal of the Trustee with respect to the Securities of any series and each
appointment of a successor Trustee with respect to the Securities of any series
in the manner provided for notices to the Holders of Securities in Section 1.6.
Each notice shall include the name of the successor Trustee with respect to the
Securities of such series and the address of its Corporate Trust Office.
Section 6.11. Eligibility; Disqualification. There shall at all times
be a Trustee hereunder with respect to each series of Securities (which need not
be the same Trustee for all series). Each Trustee hereunder shall be eligible to
act as trustee under Section 310(a) (1) of the Trust Indenture Act and shall
have a combined capital and surplus of at least $100,000,000. If such
corporation publishes reports of condition at least annually, pursuant to law or
the requirements of Federal, State, Territorial or District of Columbia
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.
If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture.
Section 6.12. Merger, Conversion, Consolidation or Succession to
Business. Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been authenticated,
but not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with the same effect
as if such successor Trustee had itself authenticated such Securities.
Section 6.13. Appointment of Authenticating Agent. The Trustee may
appoint an Authenticating Agent or Agents with respect to one or more series of
Securities which shall be authorized to act on behalf of the Trustee to
authenticate Securities of such series issued upon original issue exchange,
registration of transfer or partial redemption thereof, and Securities so
authenticated shall be entitled to the benefits of this Indenture and shall be
valid and obligatory for all purposes as if authenticated by the Trustee
hereunder. Any such appointment shall be evidenced by an instrument in writing
signed by a Responsible Officer of the Trustee, a copy of which instrument shall
be promptly furnished to the Company. Wherever reference is made in this
Indenture to the authentication and delivery of Securities by the Trustee or the
Trustee's certificate of authentication, such reference shall be deemed to
include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Company and, except as may otherwise be provided pursuant to
Section 3.1, shall at all times be a bank or trust company or corporation
organized and doing business and in good standing under the laws of the United
States of America or of any State or the District of Columbia, authorized under
such laws to act as Authenticating Agent, having a combined capital and surplus
of not less than $1,500,000 and subject to supervision or examination by Federal
or State authorities. If such Authenticating Agent publishes reports of
condition at least annually, pursuant to law or the requirements of the
aforesaid supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such Authenticating Agent shall be
deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. In case at any time an Authenticating Agent
shall cease to be eligible in accordance with the provisions of this Section,
such Authenticating Agent shall resign immediately in the manner and with the
effect specified in this Section.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or further act
on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent for any series of Securities may at any time
resign by giving written notice of resignation to the Trustee for such series
and to the Company. The Trustee for any series of Securities may at any time
terminate the agency of an Authenticating Agent by giving written notice of
termination to such Authenticating Agent and to the Company. Upon receiving such
a notice of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee for such series may appoint a successor
Authenticating Agent which shall be acceptable to the Company and shall give
notice of such appointment to all Holders of Securities of the series with
respect to which such Authenticating Agent will serve in the manner set forth in
Section 1.6. 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 herein. No successor Authenticating Agent shall be
appointed unless eligible under the provisions of this Section.
The Company agrees to pay to each Authenticating Agent from time to
time such reasonable compensation as the Company and such Authenticating Agent
agree in writing from time to time including reimbursement of its reasonable
expenses for its services under this Section.
If an appointment with respect to one or more series is made pursuant
to this Section, the Securities of such series may have endorsed thereon, in
addition to or in lieu of the Trustee's certificate of authentication, an
alternate certificate of authentication substantially in the following form:
This is one of the Securities of the series designated herein and
issued under the within-mentioned Indenture.
________________________, as Trustee
By
as Authenticating Agent
By
Authorized Signatory
ARTICLE VII
CONSOLIDATION, MERGER OR SALE BY THE COMPANY
Section 7.1. Consolidation, Merger or Sale of Assets Permitted. The
Company may merge or consolidate with or into any other Person or sell, convey,
transfer or otherwise dispose of all or substantially all of its assets to any
Person, if (i) (A) in the case of a merger or consolidation, the Company is the
surviving corporation or (B) in the case of a merger or consolidation where the
Company is not the surviving corporation and in the case of any sale,
conveyance, transfer or other disposition, the resulting, surviving or
transferee Person is organized and existing under the laws of the United States
or a State thereof and such Person expressly assumes by supplemental indenture
all the obligations of the Company under the Securities and any coupons
appertaining thereto and under this Indenture, (ii) immediately thereafter,
giving effect to such merger or consolidation, or such sale, conveyance,
transfer or other disposition, no Default or Event of Default shall have
occurred and be continuing and (iii) the Company shall have delivered to the
Trustee an Officers' Certificate and an Opinion of Counsel each stating that
such merger, consolidation, sale, conveyance, transfer or other disposition
complies with this Article and that all conditions precedent herein provided for
relating to such transaction have been complied with. In the event of the
assumption by a successor Person of the obligations of the Company as provided
in clause (i) (B) of the immediately preceding sentence, such successor Person
shall succeed to and be substituted for the Company hereunder and under the
Securities and any coupons appertaining thereto and all such obligations of the
Company shall terminate.
ARTICLE VIII
SUPPLEMENTAL INDENTURES
Section 8.1. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company and the Trustee, at any time and
from time to time, may enter into indentures supplemental hereto, in form
reasonably satisfactory to the Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the
Company and the assumption by any such successor of
the covenants and obligations of the Company herein
and in the Securities (with such changes herein and
therein as may be necessary or advisable to reflect
such Person's legal status, if such Person is not a
corporation); or
(2) to add to the covenants of the Company for the
benefit of the Holders of all or any series of
Securities (and if such covenants are to be for the
benefit of less than all series of Securities,
stating that such covenants are expressly being
included solely for the benefit of such series) or to
surrender any right or power herein conferred upon
the Company or to comply with any requirement of the
Commission or otherwise in connection with the
qualification of this Indenture under the Trust
Indenture Act or otherwise; or
(3) to add any additional Events of Default with respect
to all or any series of Securities; or
(4) to add to or change any of the provisions of this
Indenture to such extent as shall be necessary to
facilitate the issuance of Bearer Securities
(including, without limitation, to provide that
Bearer Securities may be registrable as to principal
only) or to facilitate or provide for the issuance of
Securities in global form in addition to or in place
of Securities in certificated form; or
(5) to change or eliminate any of the provisions of this
Indenture, provided that any such change or
elimination shall become effective only with respect
to Securities which have not been issued as of the
execution of such supplemental indenture or when
there is no Security Outstanding of any series
created prior to the execution of such supplemental
indenture which is entitled to the benefit of such
provision; or
(6) to add guarantees with respect to any or all of the
Securities; or
(7) to convey, transfer, assign, mortgage or pledge any
property to or with the Trustee; or
(8) to supplement any of the provisions of this Indenture
to such extent as shall be necessary to permit or
facilitate the defeasance and discharge of any series
of Securities pursuant to Sections 4.1, 4.4, and 4.5;
provided that any such action shall not adversely
affect the interests of the Holders of Securities of
such series and any related coupons or any other
series of Securities in any material respect; or
(9) to establish the form or terms of Securities of any
series as permitted by Sections 2.1 and 3.1; or
(10) to provide for the delivery of indentures
supplemental hereto or the Securities of any series
in or by means of any computerized, electronic or
other medium, including without limitation by
computer diskette; or
(11) to evidence and provide for the acceptance of
appointment hereunder by a successor or separate
Trustee with respect to the Securities of one or more
series and/or to add to or change any of the
provisions of this Indenture as shall be necessary to
provide for or facilitate the administration of the
trusts hereunder by more than one Trustee, pursuant
to the requirements of Article VI; or
(12) if allowed without penalty under applicable laws and
regulations, to permit payment in the United States
(including any of the states and the District of
Columbia), its territories, its possessions and other
areas subject to its jurisdiction of principal,
premium, if any, or interest, if any, on Bearer
Securities or coupons, if any; or
(13) to correct or supplement any provision herein which
may be inconsistent with any other provision herein
or to cure any ambiguity or omission or to correct
any mistake; or
(14) to make any other provisions with respect to matters
or questions arising under this Indenture, provided
such action shall not adversely affect the interests
of the Holders of Securities of any series in any
material respect.
Section 8.2. With Consent of Holders. With the written consent of the
Holders of a majority of the aggregate principal amount of the Outstanding
Securities of each series adversely affected by such supplemental indenture
(with the Securities of each series voting as a class), the Company and the
Trustee may enter into an indenture or indentures supplemental hereto to add any
provisions to or to change or eliminate any provisions of this Indenture or of
any other indenture supplemental hereto or to modify the rights of the Holders
of Securities of each such series; provided, however, that without the consent
of the Holder of each Outstanding Security affected thereby, a supplemental
indenture under this Section may not:
(1) change the Stated Maturity of the principal of, or
any installment of principal of or interest on, any
Security, or reduce the principal amount thereof or
the rate of interest thereon or any premium payable
upon the redemption thereof, or reduce the amount of
the principal of an Original Issue Discount Security
or Indexed Security that would be due and payable
upon a declaration of acceleration of the Maturity
thereof pursuant to Section 5.2, or change any Place
of Payment where, or the coin or currency in which
any Securities or any premium or the interest thereon
is payable, or impair the right to institute suit for
the enforcement of any such payment on or after the
Stated Maturity thereof (or, in the case of
redemption, on or after the Redemption Date);
(2) reduce the percentage in principal amount of the
Outstanding Securities of any series, the consent of
whose Holders is required for any such supplemental
indenture, or the consent of whose Holders is
required for any waiver of compliance with certain
provisions of this Indenture or certain defaults
hereunder and their consequences provided for in this
Indenture;
(3) change any obligation of the Company to maintain an
office or agency in the places and for the purposes
specified in Section 9.2; or
(4) except to the extent provided in Section 8.1(11),
make any change in Section 5.7 or this 8.2 except to
increase any percentage or to provide that certain
other provisions of this Indenture cannot be modified
or waived except with the consent of the Holders of
each Outstanding Security affected thereby, provided,
however, that this clause shall not be deemed to
require the consent of any Holders with respect to
changes in the references to the "Trustee" and
concomitant changes in this Section, in accordance
with the requirements of Sections 6.10(b) and
8.1(11);
(5) release any guarantors from their guarantees of the
Securities, or, except as contemplated in any
supplemental indenture, make any change in a
guarantee of a Security that would adversely affect
the interests of the Holders; or
(6) modify the ranking or priority of the Securities.
For the purposes of this Section 8.2, if the
Securities of any series are issuable upon the
exercise of warrants, any holder of an unexercised
and unexpired warrant with respect to such series
shall not be deemed to be a Holder of Outstanding
Securities of such series in the amount issuable upon
the exercise of such warrants.
A supplemental indenture which changes or eliminates any covenant or
other provision of this Indenture which has expressly been included solely for
the benefit of one or more particular series of Securities, or which modifies
the rights of the Holders of Securities of such series with respect to such
covenant or other provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Securities of any other series.
It is not necessary under this Section 8.2 for the Holders to consent
to the particular form of any proposed supplemental indenture, but it is
sufficient if they consent to the substance thereof.
Section 8.3. Compliance with Trust Indenture Act. Every amendment to
this Indenture or the Securities of one or more series shall be set forth in a
supplemental indenture that complies with the Trust Indenture Act as then in
effect.
Section 8.4. Execution of Supplemental Indentures. In executing, or
accepting the additional trusts created by, any supplemental indenture permitted
by this Article or the modification thereby of the trusts created by this
Indenture, the Trustee shall be entitled to receive, and shall be fully
protected in relying upon, an Opinion of Counsel stating that the execution of
such supplemental indenture is authorized or permitted by this Indenture. The
Trustee may, but shall not be obligated to, enter into any such supplemental
indenture which adversely affects the Trustee's own rights, duties or immunities
under this Indenture or otherwise. The Trustee shall enter into any such
supplemental indenture if such supplemental indenture does not adversely affect
the Trustee's own rights, duties or immunities under this Indenture or
otherwise.
Section 8.5. 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 coupon appertaining
thereto shall be bound thereby; provided that if such supplemental indenture
makes any of the changes described in clauses (1) through (4) of the first
proviso to Section 8.2, such supplemental indenture shall bind each Holder of a
Security who has consented to it and every subsequent Holder of such Security or
any part thereof.
Section 8.6. Reference in Securities to Supplemental Indentures.
Securities, including any coupons, of any series authenticated and delivered
after the execution of any supplemental indenture pursuant to this Article may,
and shall if required by the Trustee, bear a notation in form approved by the
Trustee as to any matter provided for in such supplemental indenture. If the
Company shall so determine, new Securities including any coupons of any series
so modified as to conform, in the opinion of the Trustee and the Company, to any
such supplemental indenture may be prepared and executed by the Company and
authenticated and delivered by the Trustee in exchange for Outstanding
Securities including any coupons of such series.
ARTICLE IX
COVENANTS
Section 9.1. Payment of Principal, Premium, if any, and Interest. The
Company covenants and agrees for the benefit of the Holders of each series of
Securities that it will duly and punctually pay the principal of, premium, if
any, and interest on the Securities of that series in accordance with the terms
of the Securities of such series, any coupons appertaining thereto and this
Indenture. An installment of principal, premium, if any, or interest shall be
considered paid on the date it is due if the Trustee or Paying Agent holds on
that date money designated for and sufficient to pay the installment.
Section 9.2. Maintenance of Office or Agency. If Securities of a series
are issued as Registered Securities, the Company will maintain in each Place of
Payment for any series of Securities an office or agency where Securities of
that series may be presented or surrendered for payment, where Securities of
that series may be surrendered for registration of transfer or exchange and
where notices and demands to or upon the Company in respect of the Securities of
that series and this Indenture may be served. If Securities of a series are
issuable as Bearer Securities, the Company will maintain, (i) subject to any
laws or regulations applicable thereto, an office or agency in a Place of
Payment for that series which is located outside the United States, where
Securities of that series and related coupons may be presented and surrendered
for payment; provided, however, that if the Securities of that series are listed
on The International Stock Exchange of the United Kingdom and the Republic of
Ireland Limited, the Luxembourg Stock Exchange or any other stock exchange
located outside the United States and such stock exchange shall so require, the
Company will maintain a Paying Agent for the Securities of that series in
London, Luxembourg or any other required city located outside the United States,
as the case may be, so long as the Securities of that series are listed on such
exchange, and (ii) subject to any laws or regulations applicable thereto, an
office or agency in a Place of Payment for that series which is located outside
the United States where Securities of that series may be surrendered for
exchange and where notices and demands to or upon the Company in respect of the
Securities of that series and this Indenture may be served. The Company will
give prompt written notice to the Trustee 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, such presentations, surrenders, notices and demands
may be made or served at the Corporate Trust Office of the Trustee, except that
Bearer Securities of that series and the related coupons unless otherwise
specified in the Supplemental Indenture for such Series, may be presented and
surrendered for payment and conversion at the offices specified in the Security,
in London, England, and the Company hereby appoints the Trustee as its agent to
receive all such presentations, surrenders, notices and demands.
Unless otherwise specified as contemplated by Section 3.1, no payment
of principal, premium or interest on Bearer Securities shall be made at any
office or agency of the Company in the United States, by check mailed to any
address in the United States, by transfer to an account located in the United
States or upon presentation or surrender in the United States of a Bearer
Security or coupon for payment, even if the payment would be credited to an
account located outside the United States; provided, however, that, if the
Securities of a series are denominated and payable in Dollars, payment of
principal of and any premium or interest on any such Bearer Security shall be
made at an office of a Paying Agent of the Company in the Borough of Manhattan,
The City of New York, if (but only if) payment in Dollars of the full amount of
such principal, premium or interest, as the case may be, at all offices or
agencies outside the United States maintained for the purpose by the Company in
accordance with this Indenture is illegal or effectively precluded by exchange
controls or other similar restrictions.
Subject to the preceding paragraphs, the Company may also from time to
time designate one or more other offices or agencies where the Securities
(including any coupons, if any) of one or more series may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; provided, however, that no such designation or rescission shall in
any manner relieve the Company of its obligation to maintain an office or agency
in each Place of Payment for Securities (including any coupons, if any) of any
series for such purposes. The Company will give prompt written notice to the
Trustee of any such designation or rescission and of any change in the location
of any such other office or agency.
Unless otherwise specified as contemplated by Section 3.1, the Trustee
shall initially serve as Paying Agent. The Paying Agent may make reasonable
rules not inconsistent herewith for the performance of its functions.
Section 9.3. Money for Securities to Be Held in Trust; Unclaimed Money.
If the Company shall at any time act as its own Paying Agent with respect to any
series of Securities, it will, on or before each due date of the principal of,
premium, if any, or interest on any of the Securities of that series, segregate
and hold in trust for the benefit of the Persons entitled thereto a sum
sufficient to pay the principal, 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 will promptly notify the Trustee in writing of its action or
failure so to act.
Whenever the Company shall have one or more Paying Agents for any
series of Securities, it will, on or prior to each due date of the principal of
or any premium or interest on any Securities of that series, deposit with a
Paying Agent a sum sufficient to pay such amount, such sum to be held as
provided by the Trust Indenture Act, and (unless such Paying Agent is the
Trustee) the Company will promptly notify the Trustee of its action or failure
so to act.
If the Company is not acting as its own Paying Agent, the Company will
cause each Paying Agent for any series of Securities other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent will:
(1) hold all sums held by it for the payment of the
principal of, premium, if any, or interest on
Securities of that series in trust for the benefit of
the Persons entitled thereto until such sums shall be
paid to such Persons or otherwise disposed of as
herein provided;
(2) give the Trustee notice of any default by the Company
(or any other obligor upon the Securities of that
series) in the making of any payment of principal,
premium, if any, or interest on the Securities; and
(3) at any time during the continuance of any such
default, upon the written request of the Trustee,
forthwith pay to the Trustee all sums so held in
trust by such Paying Agent.
The Company may at any time, for the purpose of
obtaining the satisfaction and discharge of this
Indenture or for any other purpose, pay, or by
Company Order direct any Paying Agent to pay, to the
Trustee all sums held in trust by the Company or such
Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums
were held by the 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 any principal, premium or interest
or other amounts on any Security of any series and remaining unclaimed for two
years after such principal, premium, if any, or interest or other amounts has
become due and payable shall be paid to the Company on Company Request
(including interest income on such funds, if any), or (if then held by the
Company) shall be discharged from such trust; and the Holder of such Security
and coupon, if any, shall thereafter, as an unsecured general creditor, look
only to the Company for payment thereof, and all liability of the Trustee or
such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Company cause to be published once, in a newspaper
published in the English language, customarily published on each Business Day
and of general circulation in The City of New York, or cause to be mailed to
such Holder, 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 9.4. Corporate Existence. Subject to Article VII, the Company
will at all times do or cause to be done all things necessary to preserve and
keep in full force and effect its corporate existence and its rights and
franchises; provided that nothing in this Section 9.4 shall prevent the
abandonment or termination of any right or franchise of the Company if, in the
opinion of the Company, such abandonment or termination is in the best interests
of the Company.
Section 9.5. Maintenance of Properties. The Company will cause all
material properties used or useful in the conduct of its business or the
business of any Subsidiary to be maintained and kept in good condition, repair
and working order and supplied with all necessary equipment and will cause to be
made all necessary repairs, renewals, replacements, betterments and improvements
thereof, all as (and to the extent) in the judgment of the Company may be
necessary or appropriate in connection with its business; 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 9.6. Reports by the Company. The Company covenants:
(a) to file with the Trustee, within 30 days after the
Company is required to file the same with the
Commission, copies of the annual reports and of the
information, documents and other reports (or copies of
such portions of any of the foregoing as the Commission
may from time to time by rules and regulations
prescribe) which the Company may be required to file
with the Commission pursuant to section 13 or section
15(d) of the Securities Exchange Act of 1934, as
amended; or, if the Company is not required to file
information, documents or reports pursuant to either of
such sections, then to file with the Trustee and the
Commission, in accordance with rules and regulations
prescribed from time to time by the Commission, such of
the supplementary and periodic information, documents
and reports which may be required pursuant to section
13 of the Securities Exchange Act of 1934, as amended,
in respect of a security listed and registered on a
national securities exchange as may be prescribed from
time to time in such rules and regulations;
(b) to file with the Trustee and the Commission, in
accordance with the rules and regulations prescribed
from time to time by the Commission, such additional
information, documents and reports with respect to
compliance by the Company with the conditions and
covenants provided for in this Indenture, as may be
required from time to time by such rules and
regulations; and
(c) to transmit to all Holders of Securities within 30 days
after the filing thereof with the Trustee, in the
manner and to the extent provided in section 313(c) of
the Trust Indenture Act, such summaries of any
information, documents and reports required to be filed
by the Company pursuant to subsections (a) and (b) of
this Section 9.6, as may be required by rules and
regulations prescribed from time to time by the
Commission.
Section 9.7. Annual Review Certificate. The Company covenants and
agrees to deliver to the Trustee, within 120 days after the end of each fiscal
year of the Company, a brief certificate from the principal executive officer,
principal financial officer, or principal accounting officer as to his or her
knowledge of the Company's compliance with all conditions and covenants under
this Indenture. For purposes of this Section 9.7, such compliance shall be
determined without regard to any period of grace or requirement of notice
provided under this Indenture.
Section 9.8. Payment of Taxes and Other Claims. The Company will pay or
discharge or cause to be paid or discharged, within 30 days after the Company
shall have received notice that the same has become delinquent (1) all material
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, and (2) all lawful claims for labor, materials and supplies which,
if unpaid, might by law become a material lien upon the property of the Company
or any Subsidiary; provided, however, that the Company shall not be required to
pay or discharge or cause to be paid or discharged any such tax, assessment,
charge or claim whose amount, applicability or validity is being contested in
good faith by appropriate proceedings; provided, further, that the Company shall
not be required to pay or discharge or cause to be paid or discharged any such
tax, assessment, charge or claim unless the failure to pay or discharge such
tax, assessment, charge or claim would, individually or in the aggregate with
all such failures, have a material adverse effect on the Company and its
Subsidiaries taken as a whole.
ARTICLE X
REDEMPTION
Section 10.1. Applicability of Article. Securities (including coupons,
if any) of or within any series which are redeemable in whole or in part before
their Stated Maturity shall be redeemable in accordance with their terms and
(except as otherwise specified as contemplated by Section 3.1 for Securities of
any series) in accordance with this Article.
Section 10.2. Election to Redeem; Notice to Trustee. The election of
the Company to redeem any Securities, including coupons, if any, shall be
evidenced by a Board Resolution. In the case of any redemption at the election
of the Company of less than all the Securities or coupons, if any, of any series
of the same tenor, the Company shall, at least 60 days (45 days in the case of
redemption of all Securities of any series or of any series with the same (i)
Stated Maturity, (ii) period or periods within which, price or prices at which
and terms and conditions upon which such Securities may or shall be redeemed or
purchased, in whole or in part, at the option of the Company or pursuant to any
sinking fund or analogous provision or repayable at the option of the Holder and
(iii) rate or rates at which the Securities bear interest, if any, or formula
pursuant to which such rate or rates accrue (collectively, the "Equivalent
Principal Terms")) prior to the Redemption Date fixed by the Company (unless a
shorter notice shall be satisfactory to the Trustee), notify the Trustee of such
Redemption Date of the principal amount of Securities of such series to be
redeemed and, if applicable, of the tenor of the Securities to be redeemed. In
the case of any redemption of Securities (i) prior to the expiration of any
restriction on such redemption provided in the terms of such Securities or
elsewhere in this Indenture or (ii) pursuant to an election of the Company which
is subject to a condition specified in the terms of such Securities, the Company
shall furnish the Trustee with an Officers' Certificate evidencing compliance
with such restriction or condition.
Section 10.3. Selection of Securities to Be Redeemed. If less than all
the Securities with Equivalent Principal Terms of any series are to be redeemed
(unless all of the Securities of such series and of a specified tenor are to be
redeemed), the particular Securities to be redeemed shall be selected not more
than 60 days prior to the Redemption Date by the Trustee, from the Outstanding
Securities of such series not previously called for redemption, by such method
as the Trustee shall deem fair and appropriate and which may provide for the
selection for redemption of portions (equal to the minimum authorized
denomination for Securities (including coupons, if any) of that series with
Equivalent Principal Terms or any integral multiple thereof) of the principal
amount of Securities (including coupons, if any) of such series with Equivalent
Principal Terms of a denomination larger than the minimum authorized
denomination for Securities of that series. Unless otherwise provided in the
terms of a particular series of Securities, the portions of the principal of
Securities so selected for partial redemption shall be equal to the minimum
authorized denomination of the Securities of such series, or an integral
multiple thereof, and the principal amount which remains outstanding shall not
be less than the minimum authorized denomination for Securities of such series.
The Trustee shall promptly notify the Company in writing of the
Securities selected for redemption and, in the case of any Securities selected
for partial redemption, the principal amount thereof to be redeemed. If the
Securities (including coupons, if any) of a series having different issue dates,
interest rates and maturities (whether or not originally issued in a Periodic
Offering) are to be redeemed, the Company in its discretion may select the
particular Securities or portions thereof to be redeemed and shall notify the
Trustee thereof by such time prior to the relevant redemption date or dates as
the Company and the Trustee may agree.
For purposes of this Indenture, unless the context otherwise requires,
all provisions relating to the redemption of Securities (including coupons, if
any) shall relate, in the case of any Securities (including coupons, if any)
redeemed or to be redeemed only in part, to the portion of the principal amount
of such Securities (including coupons, if any) which has been or is to be
redeemed.
Section 10.4. Notice of Redemption. Unless otherwise specified as
contemplated by Section 3.1, notice of redemption shall be given by first-class
mail, postage prepaid, mailed not less than 30 days nor more than 60 days prior
to the Redemption Date, unless a shorter period is specified in the Securities
to be redeemed, to each Holder of the Securities to be redeemed.
All notices of redemption shall state:
(1) the Redemption Date;
(2) the Redemption Price and the amount of accrued
interest, if any, to be paid;
(3) if less than all the Outstanding Securities of a
series are to be redeemed, the identification (and,
in the case of partial redemption of any Securities,
the principal amounts) of the particular Security or
Securities to be redeemed;
(4) in case any Security is to be redeemed in part only,
the notice which relates to such Security shall state
that on and after the Redemption Date, upon surrender
of such Security, the Holder of such Security will
receive, without a charge, a new Security or
Securities of authorized denominations for the
principal amount thereof remaining unredeemed;
(5) the Place or Places of Payment where such Securities
are to be surrendered for payment for the Redemption
Price;
(6) that Securities of the series called for redemption
and all unmatured coupons, if any, appertaining
thereto must be surrendered to the Paying Agent to
collect the Redemption Price;
(7) that, on the Redemption Date, the Redemption Price
will become due and payable upon each such Security,
or the portion thereof, to be redeemed and, if
applicable, that interest thereon will cease to
accrue on and after said date;
(8) that the redemption is for a sinking fund, if such is
the case;
(9) that, unless otherwise specified in such notice,
Bearer Securities of any series, if any, surrendered
for redemption must be accompanied by all coupons
maturing subsequent to the Redemption Date or the
amount of any such missing coupon or coupons will be
deducted from the Redemption Price, unless security
or indemnity satisfactory to the Company, the Trustee
and any Paying Agent is furnished;
(10) if Bearer Securities of any series are to be redeemed
and any Registered Securities of such series are not
to be redeemed and if such Bearer Securities may be
exchanged for Registered Securities not subject to
redemption on this Redemption Date pursuant to
Section 3.5 or otherwise, the last date, as
determined by the Company, on which such exchanges
may be made; and
(11) the CUSIP number, if any, of such Securities.
Notice of redemption of Securities to be redeemed at
the election of the Company shall be given by the
Company or, at the Company's request, by the Trustee
in the name and at the expense of the Company.
Section 10.5. Deposit of Redemption Price. On or prior to any
Redemption Date, the Company shall deposit with the Trustee or with a Paying
Agent (or, if the Company is acting as its own Paying Agent, which it may not do
in the case of a sinking fund payment under Article XI, segregate and hold in
trust as provided in Section 9.3) an amount of money in the currency or
currencies (including currency units or composite currencies) in which the
Securities of such series are payable (except as otherwise specified pursuant to
Section 3.1 for the Securities of such series) sufficient to pay on the
Redemption Date the Redemption Price of, and (unless the Redemption Date shall
be an Interest Payment Date) interest accrued to the Redemption Date on, all
Securities or portions thereof which are to be redeemed on that date.
Unless any Security by its terms prohibits any sinking fund payment
obligation from being satisfied by delivering and crediting Securities
(including Securities redeemed otherwise than through a sinking fund), the
Company may deliver such Securities to the Trustee for crediting against such
payment obligation in accordance with the terms of such Securities and this
Indenture.
Section 10.6. Securities Payable on Redemption Date. Notice of
redemption having been given as aforesaid, the Securities so to be redeemed
shall, on the Redemption Date, become due and payable at the Redemption Price
therein specified, and from and after such date (unless the Company shall
default in the payment of the Redemption Price and accrued interest) such
Securities shall cease to bear interest and the coupons for any such interest
appertaining to any Bearer Security so to be redeemed, except to the extent
provided below, shall be void. Except as provided in the next succeeding
paragraph, upon surrender of any such Security, including coupons, if any, for
redemption in accordance with said notice, such Security shall be paid by the
Company at the Redemption Price, together with accrued interest, if any, to the
Redemption Date; provided, however, that unless otherwise specified as
contemplated by Section 3.1, installments of interest on Bearer Securities whose
Stated Maturity is on or prior to the Redemption Date and the principal of, and
premium, if any, on such Bearer Securities shall be payable only at an office or
agency located outside the United States and it possessions (except as otherwise
provided in Section 9.2) and, unless otherwise specified as contemplated by
Section 3.1, only upon presentation and surrender of coupons for such interest;
and provided, further, that, unless otherwise specified as contemplated by
Section 3.1, installments of interest on Registered Securities whose Stated
Maturity is on or prior to the Redemption Date shall be payable to the Holders
of such Securities, or one or more Predecessor Securities, registered as such at
the close of business on the relevant Record Dates according to their terms and
the provisions of Section 3.7.
If any Bearer Security surrendered for redemption shall not be
accompanied by all appurtenant coupons maturing after the Redemption Date, such
Bearer Security may be paid after deducting from the Redemption Price an amount
equal to the face amount of all such missing coupons, or the surrender of such
missing coupon or coupons may be waived by the Company and the Trustee if there
be furnished to them such security or indemnity as they may require to save each
of them and any Paying Agent harmless. If thereafter the Holder of such Bearer
Security shall surrender to the Trustee or any Paying Agent any such missing
coupon in respect of which a deduction shall have been made from the Redemption
Price, such Holder shall be entitled to receive the amount so deducted;
provided, however, that interest represented by coupons shall be payable only at
an office or agency located outside of the United States (except as otherwise
provided pursuant to Section 9.2) and, unless otherwise specified as
contemplated by Section 3.1, only upon presentation and surrender of those
coupons.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal (and premium, if any) shall,
until paid, bear interest from the Redemption Date at the rate prescribed
therefor in the Security.
Section 10.7. Securities Redeemed in Part. Upon surrender of a Security
that is redeemed only in part at any Place of Payment therefor (with, if the
Company or the Trustee so require, 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), the Company
shall execute and the Trustee shall authenticate and deliver to the Holder of
that Security, without service charge, a new Security or Securities of the same
series, having the same form, terms and Stated Maturity, in any authorized
denomination equal in aggregate principal amount to the unredeemed portion of
the principal amount of the Security surrendered.
ARTICLE XI
SINKING FUNDS
Section 11.1. Applicability of Article. The provisions of this Article
shall be applicable to any sinking fund for the retirement of Securities of a
series except as otherwise specified as contemplated by Section 3.1 for
Securities of such series.
The minimum amount of any sinking fund payment provided for by the
terms of Securities of any series is herein referred to as a "mandatory sinking
fund payment," and any payment in excess of such minimum amount provided for by
the terms of Securities of any series is herein referred to as an "optional
sinking fund payment." If provided for by the terms of Securities of any series,
the cash amount of any sinking fund payment may be subject to reduction as
provided in Section 11.2. Each sinking fund payment shall be applied to the
redemption of Securities of any series as provided for by the terms of
Securities of such series.
Section 11.2. Satisfaction of Sinking Fund Payments with Securities.
The Company (i) may deliver Outstanding Securities of a series (other than any
previously called for redemption) together, in the case of Bearer Securities of
such series, with all unmatured coupons appertaining thereto and (ii) may apply
as a credit Securities of a series which have been redeemed either at the
election of the Company pursuant to the terms of such Securities or through the
application of permitted optional sinking fund payments pursuant to the terms of
such Securities, in each case in satisfaction of all or any part of any sinking
fund payment with respect to the Securities of such series required to be made
pursuant to the terms of such Securities as provided for by the terms of such
series; provided that such Securities have not been previously so credited. Such
Securities shall be received and credited for such purpose by the Trustee at the
Redemption Price specified in such Securities for redemption through operation
of the sinking fund and the amount of such sinking fund payment shall be reduced
accordingly.
Section 11.3. Redemption of Securities for Sinking Fund. Not less than
60 days prior to each sinking fund payment date for any series of Securities,
the Company will deliver to the Trustee an Officers' Certificate specifying the
amount of the next ensuing sinking fund payment for that series pursuant to the
terms of that series, the portion thereof, if any, which is to be satisfied by
payment of cash and the portion thereof, if any, which is to be satisfied by
delivering and crediting Securities of that series pursuant to Section 11.2 and
will also deliver to the Trustee any Securities to be so delivered. Not less
than 30 days before each such sinking fund payment date the Trustee shall select
the Securities to be redeemed upon such sinking fund payment date in the manner
specified in Section 10.3 and cause notice of the redemption thereof to be given
in the name of and at the expense of the Company in the manner provided in
Section 10.4. Such notice having been duly given, the redemption of such
Securities shall be made upon the terms and in the manner stated in Sections
10.6 and 10.7.
This Indenture may be executed in any number of counterparts, each of
which shall be an original, but such counterparts shall together constitute but
one 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.
AMERICA ONLINE, INC.
By:
Title:
[Seal]
Attest:
Title:
, as Trustee
By:
Title:
[Seal]
Attest:
Title:
America Online, Inc.
22000 AOL way
Dulles, Virginia 20166-9323
Ladies and Gentlemen:
We have acted as counsel to America Online, Inc., a Delaware
corporation (the "Company"), in connection with the preparation of a
Registration Statement on Form S-3 (the "Registration Statement") filed by the
Company with the Securities and Exchange Commission (the "Commission") on or
about May 27, 1999. The Registration Statement relates to the issuance and sale
from time to time, pursuant to Rule 415 of the General Rules and Regulations
promulgated under the Securities Act of 1933, as amended (the "Securities Act"),
of the following securities of the Company with an aggregate initial public
offering price of up to $5,000,000,000: (i) common stock, par value $.01 per
share ("Common Stock"), (ii) one or more series of preferred stock, par value
$.01 per share ("Preferred Stock"), (iii) one or more series of unsecured debt
securities consisting of senior debentures, notes, convertible notes, bonds
and/or other evidences of indebtedness ("Debt Securities"), (iv) one or more
series of Preferred Stock represented by depositary shares ("Depositary
Shares"), (v) warrants to purchase Common Stock, Preferred Stock, Debt
Securities or Depositary Shares ("Warrants"), and (vi) stock purchase contracts
to purchase Common Stock or Preferred Stock ("Stock Purchase Contracts," and
together with the Common Stock, Preferred Stock, Debt Securities, Depositary
Shares and Warrants, the "Securities"). The Debt Securities may be issued under
an Indenture in the form filed as an exhibit to the Registration Statement, as
amended or supplemented from time to time (the "Indenture"), proposed to be
entered into between the Company and one or more trustees chosen by the Company
and qualified to act as such under the Trust Indenture Act of 1939, as amended
(the "Trustee"). The Depositary Shares may be issued by a depositary under one
or more depositary agreements (each a "Depositary Agreement"), proposed to be
entered into between the Company and a financial institution identified therein
as the depositary (each a "Depositary"). The Warrants may be issued under one or
more warrant agreements (each a "Warrant Agreement"), proposed to be entered
into between the Company and a financial institution identified therein as the
warrant agent (each a "Warrant Agent"). The Stock Purchase Contracts may be
issued pursuant to one or more stock purchase agreements (each, a "Stock
Purchase Agreement").
In connection with this opinion, we have examined (i) the form of
Registration Statement relating to the Securities; (ii) the form of Indenture;
(iii) the Company's Restated Certificate of Incorporation, as amended and
currently in effect (the "Certificate of Incorporation"); (iv) the Company's
Bylaws, as amended and currently in effect (the "Bylaws"); and (v) resolutions
adopted by the Board of Directors of the Company (the "Board") relating to the
filing of the Registration Statement with respect to the Securities and related
matters (the "Board Resolutions"). We have also examined originals or copies,
certified or otherwise identified to our satisfaction, of such records of the
Company, certificates of officers or other representatives of the Company,
certificates of public officials and others, and such other agreements,
documents, certificates and records as we have deemed necessary or appropriate
as a basis for the opinions set forth herein.
In our capacity as counsel to the Company in connection with such
registration, we are familiar with the proceedings taken and proposed to be
taken by the Company in connection with the authorization and issuance of the
Securities. For purposes of this opinion, we have assumed that such proceedings
will be timely and properly completed, in accordance with all requirements of
applicable federal, Delaware and New York laws, in the manner presently
proposed.
In our examination, we have assumed the genuineness of all signatures,
the legal capacity of natural persons, the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted to us as certified or photostatic copies and the
authenticity of the originals of such copies.
Members of our firm are admitted to the Bar of the Commonwealth of
Massachusetts, and we do not express any opinion as to the laws of any other
jurisdiction other than the General Corporation Law of the State of Delaware
(the "DGCL"). With respect to the opinion set forth in paragraph 1 below, we
have assumed for all purposes that the laws of the State of New York are
identical to the laws of the Commonwealth of Massachusetts. No opinion is
expressed herein with respect to the qualification of the Securities under the
securities or blue sky laws of any state or any foreign jurisdiction. The
Securities may be issued from time to time on a delayed or continuous basis, but
this opinion is limited to the laws, including the rules and regulations
thereunder, as in effect on the date hereof.
Based upon and subject to the foregoing, we are of the opinion that:
1. With respect to any series of Debt Securities, when (i) the
Registration Statement, as finally amended (including all post-effective
amendments), has become effective; (ii) an appropriate Prospectus Supplement
with respect to the applicable Debt Securities has been prepared, delivered and
filed in compliance with the Securities Act and the applicable rules and
regulations thereunder; (iii) if the applicable Debt Securities are to be sold
pursuant to a purchase, underwriting or similar agreement (an "Underwriting
Agreement"), such Underwriting Agreement with respect to the Debt Securities in
the form filed as an exhibit to the Registration Statement, or any
post-effective amendment thereto, has been duly authorized, executed and
delivered by the Company and the other parties thereto; (iv) the Board,
including any appropriate committee appointed thereby, and the appropriate
officers of the Company have taken all necessary corporate action to approve the
issuance and terms of the applicable Debt Securities and all matters related
thereto; (v) the terms of the applicable Debt Securities and of their issuance
and sale have been duly established in conformity with the Indenture so as not
to violate any applicable law, the Certificate of Incorporation or Bylaws of the
Company or result in a default under or breach of any agreement or instrument
binding upon the Company and so as to comply with any requirement or restriction
imposed by any court or governmental body having jurisdiction over the Company;
(vi) the Indenture has been qualified under the Trust Indenture Act of 1939, as
amended, and duly executed and delivered by the Company and the Trustee and duly
delivered by the Company to the Trustee; and (vii) the applicable Debt
Securities have been duly executed and authenticated in accordance with the
provisions of the Indenture, have been offered, issued and sold in accordance
with the terms of the Registration Statement, or any post-effective amendment
thereto, and any Prospectus and Prospectus Supplement relating thereto, have
been issued and sold in accordance with the Indenture, and have been delivered
to the purchasers thereof upon payment of the agreed upon consideration therefor
in accordance with the Underwriting Agreement with respect to the applicable
Debt Securities, or as otherwise contemplated by the Registration Statement, or
any post-effective amendment thereto, and any Prospectus and Prospectus
Supplement relating thereto, the applicable Debt Securities will be valid and
binding obligations of the Company, enforceable against the Company in
accordance with their respective terms.
2. The Company has the authority pursuant to its Certificate of
Incorporation to issue up to 5,000,000 shares of Preferred Stock in one or more
series. With respect to any series of Preferred Stock, when (i) the Registration
Statement, as finally amended (including all post-effective amendments), has
become effective; (ii) an appropriate Prospectus Supplement with respect to the
applicable Preferred Stock has been prepared, delivered and filed in compliance
with the Securities Act and the applicable rules and regulations thereunder;
(iii) if the applicable Preferred Stock is to be sold pursuant to an
Underwriting Agreement, such Underwriting Agreement with respect to the
applicable Preferred Stock in the form filed as an exhibit to the Registration
Statement, or any post-effective amendment thereto, has been duly authorized,
executed and delivered by the Company and the other parties thereto; (iv) the
Board, including any appropriate committee appointed thereby, and appropriate
officers of the Company have taken all necessary corporate action to approve the
issuance and terms of the applicable Preferred Stock and all matters related
thereto, including the adoption of a Certificate of Designation relating to the
applicable Preferred Stock in accordance with the applicable provisions of the
DGCL (the "Certificate of Designation"); (v) the filing of the Certificate of
Designation with the Secretary of State of the State of Delaware has duly
occurred; (vi) the terms of the applicable Preferred Stock and of its issuance
and sale have been duly established in conformity with the Certificate of
Incorporation, including the Certificate of Designation, relating to the
applicable Preferred Stock and the Bylaws of the Company so as not to violate
any applicable law, the Certificate of Incorporation or Bylaws of the Company or
result in default under or breach of any agreement or instrument binding upon
the Company and so as to comply with any requirement or restriction imposed by
any court or governmental body having jurisdiction over the Company; (vii) the
applicable Preferred Stock has been offered, issued and sold in accordance with
the terms of the Registration Statement, or any post-effective amendment
thereto, and any Prospectus and Prospectus Supplement relating thereto; and
(viii) certificates representing the shares of the applicable Preferred Stock
have been duly executed, signed, registered and delivered upon payment of the
agreed upon consideration therefor in accordance with the Underwriting Agreement
with respect to the Preferred Stock, or as otherwise contemplated by the
Registration Statement, or any post-effective amendment thereto, and any
Prospectus and Prospectus Supplement relating thereto, (A) the shares of the
applicable Preferred Stock will be duly authorized, validly issued, fully paid
and nonassessable, and (B) if the applicable Preferred Stock is convertible or
exchangeable into Common Stock, the Common Stock issuable upon conversion or
exchange of the applicable Preferred Stock will be duly authorized, validly
issued, fully paid and nonassessable, assuming the execution, authentication,
issuance and delivery of the applicable Preferred Stock and the conversion or
exchange thereof in accordance with the terms of the Certificate of Designation.
3. The Company has the authority pursuant to its Certificate of
Incorporation to issue up to 1,800,000,000 shares of Common Stock. With respect
to the issuance of any shares of Common Stock, when (i) the Registration
Statement, as finally amended (including all post-effective amendments) has
become effective; (ii) an appropriate Prospectus Supplement with respect to the
applicable shares of Common Stock has been prepared, delivered and filed in
compliance with the Securities Act and the applicable rules and regulations
thereunder; (iii) if the applicable shares of Common Stock are to be sold
pursuant to an Underwriting Agreement, such Underwriting Agreement with respect
to the applicable shares of Common Stock has been duly authorized, executed and
delivered by the Company and the other parties thereto; (iv) the Board,
including any appropriate committee appointed thereby, and appropriate officers
of the Company have taken all necessary corporate action to approve the issuance
of the applicable shares of Common Stock and all matters related thereto; (v)
the terms of the issuance and sale of the applicable shares of Common Stock have
been duly established in conformity with the Certificate of Incorporation and
Bylaws so as not to violate any applicable law, the Certificate of Incorporation
or Bylaws of the Company or result in a default under or breach of any agreement
or instrument binding upon the Company and so as to comply with any restriction
imposed by any court or governmental body having jurisdiction over the Company;
(vi) the applicable shares of Common Stock have been offered, issued and sold in
accordance with the terms of the Registration Statement, or any post-effective
amendment thereto, and any Prospectus and Prospectus Supplement relating
thereto; and (vii) certificates representing the applicable shares of Common
Stock have been duly executed, signed, registered and delivered upon payment of
the agreed upon consideration therefor in accordance with the Underwriting
Agreement with respect to the Common Stock, or as otherwise contemplated by the
Registration Statement, or any post-effective amendment thereto, and any
Prospectus and Prospectus Supplement relating thereto, the applicable shares of
Common Stock will be duly authorized, validly issued, fully paid and
nonassessable.
4. With respect to any series of Depositary Shares, when (i) the
Registration Statement, as finally amended (including all post-effective
amendments), has become effective; (ii) an appropriate Prospectus Supplement
with respect to the applicable Depositary Shares has been prepared, delivered
and filed in compliance with the Securities Act and the applicable rules and
regulations thereunder; (iii) if the applicable Depositary Shares are to be sold
pursuant to an Underwriting Agreement, such Underwriting Agreement with respect
to the applicable Depositary Shares in the form filed as an exhibit to the
Registration Statement, or any post-effective amendment thereto, has been duly
authorized, executed and delivered by the Company and the other parties thereto;
(iv) the Board, including any appropriate committee appointed thereby, and
appropriate officers of the Company have taken all necessary corporate action to
approve the issuance and terms of the applicable Depositary Shares and the
Preferred Stock underlying any such Depositary Shares, and all matters related
thereto, including the adoption of a Certificate of Designation relating to the
Preferred Stock underlying the applicable Depositary Shares and the
classification of such series of Preferred Stock; (v) the filing of the
Certificate of Designation with the Secretary of State of the State of Delaware
has duly occurred; (vi) the terms of the Preferred Stock underlying the
applicable Depositary Shares and of the issuance and sale of such Preferred
Stock have been duly established in conformity with the Certificate of
Incorporation, including the Certificate of Designation, relating to the
applicable Preferred Stock and the Bylaws of the Company so as not to violate
any applicable law, the Certificate of Incorporation or Bylaws of the Company or
result in default under or breach of any agreement or instrument binding upon
the Company and so as to comply with any requirement or restriction imposed by
any court or governmental body having jurisdiction over the Company; (vii) the
applicable Depositary Shares have been offered, issued and sold in accordance
with the terms of the Registration Statement, or any post-effective amendment
thereto, and any Prospectus and Prospectus Supplement relating thereto; (viii) a
Deposit Agreement has been duly authorized, executed and delivered by the
Company and the other parties thereto and (ix) depositary receipts representing
the Depositary Shares in the form contemplated and authorized by a Deposit
Agreement have been duly executed, signed, registered and delivered upon payment
of the agreed upon consideration therefor in accordance with the Underwriting
Agreement with respect to the Depositary Shares, or as otherwise contemplated by
the Registration Statement, or any post-effective amendment thereto, and any
Prospectus and Prospectus Supplement relating thereto, (A) the Depositary Shares
will be validly issued and (B) if the applicable Prospectus Supplement provides
that the Preferred Stock underlying the applicable Depositary Shares is
convertible or exchangeable into or for Common Stock, the Common Stock issuable
upon conversion or exchange of the applicable Preferred Stock will be duly
authorized, validly issued, fully paid and nonassessable, assuming the
execution, authentication, issuance and delivery of the applicable Depositary
Shares and underlying Preferred Stock and the conversion or exchange thereof in
accordance with the terms of the Certificate of Designation and Deposit
Agreement.
5. With respect to any Warrants, when (i) the Registration Statement,
as finally amended (including all post-effective amendments), has become
effective; (ii) an appropriate Prospectus Supplement with respect to the
applicable Warrants has been prepared, delivered and filed in compliance with
the Securities Act and the applicable rules and regulations thereunder; (iii) if
the applicable Warrants are to be sold pursuant to a purchase, underwriting or
similar agreement (an "Underwriting Agreement"), such Underwriting Agreement
with respect to the Warrants in the form filed as an exhibit to the Registration
Statement, or any post-effective amendment thereto, has been duly authorized,
executed and delivered by the Company and the other parties thereto; (iv) the
Board, including any appropriate committee appointed thereby, and the
appropriate officers of the Company have taken all necessary corporate action to
approve the issuance and terms of the applicable Warrants and associated Warrant
Agreement and all matters related thereto; (v) the terms of the applicable
Warrants and of their issuance and sale have been duly established in conformity
with the Warrant Agreement so as not to violate any applicable law, the
Certificate of Incorporation or Bylaws of the Company or result in a default
under or breach of any agreement or instrument binding upon the Company and so
as to comply with any requirement or restriction imposed by any court or
governmental body having jurisdiction over the Company; (vi) a Warrant Agreement
conforming to the description thereof in the Registration Statement, or any
post-effective amendment thereto, and any Prospectus and Prospectus Supplement
relating thereto, has been duly authorized, executed and delivered by the
Company and the Warrant Agent named therein; and (vii) the applicable Warrants
have been duly authenticated by the Warrant Agent and duly executed and
delivered on behalf of the Company in accordance with the provisions of the
Warrant Agreement, have been offered, issued and sold in accordance with the
terms of the Registration Statement, or any post-effective amendment thereto,
and any Prospectus and Prospectus Supplement relating thereto, have been issued
and sold in accordance with the Warrant Agreement, and have been delivered to
the purchasers thereof upon payment of the agreed upon consideration therefor in
accordance with the Underwriting Agreement with respect to the applicable
Warrants, or as otherwise contemplated by the Registration Statement, or any
post-effective amendment thereto, and any Prospectus and Prospectus Supplement
relating thereto, the applicable Warrants will be valid and binding obligations
of the Company, enforceable against the Company in accordance with their
respective terms.
6. With respect to any Stock Purchase Contracts, when (i) the
Registration Statement, as finally amended (including all post-effective
amendments), has become effective; (ii) an appropriate Prospectus Supplement
with respect to the applicable Stock Purchase Contracts has been prepared,
delivered and filed in compliance with the Securities Act and the applicable
rules and regulations thereunder; (iii) if the applicable Stock Purchase
Contracts are to be sold pursuant to a purchase, underwriting or similar
agreement (an "Underwriting Agreement"), such Underwriting Agreement with
respect to the Stock Purchase Contracts in the form filed as an exhibit to the
Registration Statement, or any post-effective amendment thereto, has been duly
authorized, executed and delivered by the Company and the other parties thereto;
(iv) the Board, including any appropriate committee appointed thereby, and the
appropriate officers of the Company have taken all necessary corporate action to
approve the issuance and terms of the applicable Stock Purchase Contracts and
associated Stock Purchase Agreement and all matters related thereto; (v) the
terms of the applicable Stock Purchase Contracts and of their issuance and sale
have been duly established in conformity with the Stock Purchase Agreement and
do not to violate any applicable law, the Certificate of Incorporation or Bylaws
of the Company or result in a default under or breach of any agreement or
instrument binding upon the Company and so as to comply with any requirement or
restriction imposed by any court or governmental body having jurisdiction over
the Company; (vi) a Stock Purchase Agreement conforming to the description
thereof in the Registration Statement, or any post-effective amendment thereto,
and any Prospectus and Prospectus Supplement relating thereto, has been duly
authorized, executed and delivered by the Company and the Purchase Agent named
therein; and (vii) the applicable Stock Purchase Contracts have been duly
executed and countersigned in accordance with the Stock Purchase Agreement and
have been offered, issued and sold in accordance with the terms of the
Registration Statement, or any post-effective amendment thereto, and any
Prospectus and Prospectus Supplement relating thereto, have been issued and sold
in accordance with the Stock Purchase Agreement, and have been delivered to the
purchasers thereof upon payment of the agreed upon consideration therefor in
accordance with the Underwriting Agreement with respect to the applicable Stock
Purchase Contracts, or as otherwise contemplated by the Registration Statement,
or any post-effective amendment thereto, and any Prospectus and Prospectus
Supplement relating thereto, the applicable Stock Purchase Contracts will be
valid and binding obligations of the Company, enforceable against the Company in
accordance with their respective terms.
The opinions set forth above are subject to the following exceptions,
limitations and qualifications: (i) the effect of bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium or other similar laws now or
hereafter in effect relating to or affecting the rights and remedies of
creditors; (ii) the effect of general principles of equity, whether enforcement
is considered in a proceeding in equity or at law, and the discretion of the
court before which any proceeding therefor may be brought; (iii) the
unenforceability under certain circumstances under law or court decisions of
provisions providing for the indemnification of, or contribution to, a party
with respect to a liability where such indemnification or contribution is
contrary to public policy; (iv) we express no opinion concerning the
enforceability of any waiver of rights or defenses with respect to stay,
extension or usury laws; and (v) we express no opinion with respect to whether
acceleration of any Debt Securities may affect the ability to collect any
portion of the stated principal amount thereof which might be determined to
constitute unearned interest thereon.
For purposes of the opinions rendered above, we have assumed that the
Company will at all times in the future be duly incorporated and validly
existing as a corporation under the laws of the State of Delaware and have the
corporate power and authority to issue and sell the Securities. To the extent
that the obligations of the Company under the Indenture, the Deposit Agreement,
the Warrant Agreement and the Stock Purchase Agreement, as the case may be, may
be dependent upon such matters, we assume for purposes of the foregoing opinions
the following facts at the time of the execution and delivery of such
agreements: that the other party thereto is duly organized, validly existing and
in good standing under the laws of its jurisdiction of organization; that such
party is duly qualified to engage in the activities contemplated by the
agreement; that the agreement has been duly authorized, executed and delivered
by the other party and constitutes a legally valid, binding and enforceable
obligation of the other party, enforceable against it in accordance with its
terms; that the other party is in compliance, generally and with respect to
acting in its designated capacity under such agreement, with all applicable laws
and regulations; and that the other party has the requisite organizational and
legal power and authority to perform its obligations under such agreement.
We hereby consent to the filing of this opinion with the Commission as
Exhibit 5 to the Registration Statement. We also consent to the reference to our
firm under the heading "Legal Matters" in the Registration Statement.
Very truly yours,
/s/Mintz, Levin, Cohn, Ferris,
Glovsky and Popeo, P.C.
Mintz, Levin, Cohn, Ferris,
Glovsky and Popeo, P.C.
Exhibit 12.1
America Online, Inc. and Subsidiaries
Statements RE Computation of Ratios of Earnings to Fixed Charges
Nine Months Ended March 31, 1999 and Years Ended
June 30, 1998, June 30, 1997, June 30, 1996, June 30, 1995 and June 30, 1994
<TABLE>
Nine months Year Year Year Year Year
ended ended ended ended ended ended
March 31, 1999 June 30, 1998 June 30, 1997 June 30, 1996 June 30, 1995 June 30, 1994
Fixed charges
<S> <C> <C> <C> <C> <C> <C>
Interest expense $ 13 $ 13 $ 2 $ 1 $ 1 $ -
Amortization of bond issue costs 1 1 - - - -
Interest portion (1) of
rent expense 109 106 53 16 4 1
Total fixed charges $123 $120 $ 55 $ 17 $ 5 $ 1
Income (loss) before
income taxes (2) (3) (4) (5) (6) 870 (87) (475) 69 (41) -
Earnings (7) $993 $ 33 $ (420) $ 86 $ (36) $ 1
Ratio of earnings to fixed charges 8.07 0.28 - 5.06 - 1.00
</TABLE>
1) The interest portion of the rent expense is estimated to be equal to 28% in
year one, 18% in year two, 7% in year three and 5% in year four.
2) Net income in the nine months ended March 31, 1999 includes approximately
$80 million of expense related to mergers, approximately $567 million gain
on sale of investments and $25 million in transition related expenses.
3) Net income in the fiscal year ended June 30, 1998, includes charges of
approximately $35 million related to a restructuring, $80 million related
to acquired research and development and $17 million related to
settlements.
4) Net loss in the fiscal year ended June 30, 1997, includes charges of $385
million for the write-off of deferred subscriber acquisition costs, $49
million for restructuring, $24 million for a legal settlement and $24
million for contract terminations.
5) Net income in the fiscal year ended June 30, 1996, includes charges of $17
million for acquired research and development, $8 million for the
settlement of a class action lawsuit, and $1 million for merger expenses.
6) Net loss in the fiscal year ended June 30, 1995, includes charges of $50
million for acquired research and development and $2 million for merger
expenses.
7) Earnings represent income from continuing operations before income taxes
plus interest expense on indebtedness, amortization of debt discount and
the portion of rent expense deemed representative of an interest factor.
Exhibit 23.1
Consent of Independent Auditors
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3 No. 333- ) and related Prospectus of America
Online, Inc. for the registration of its debt securities, its preferred stock
and its common stock and to the incorporation by reference therein of our report
dated September 25, 1998, with respect to the consolidated financial statements
of America Online, Inc. included in its Annual Report on Form 10-K for the year
ended June 30, 1998, our report dated September 25, 1998 (except for the last
paragraph of Note 17, as to which the date is February 15, 1999) with respect to
the consolidated financial statements of America Online, Inc., included in its
Current Report on Form 8-K dated November 9, 1998, and our report dated
September 25, 1998 (except for the second paragraph of Note 19, as to which the
date is February 15, 1999 and the third paragraph of Note 19, as to which the
date is April 15, 1999), with respect to the supplemental consolidated financial
statements of America Online, Inc. included in its Current Report on Form 8-K/A
filed on April 21, 1999, filed with the Securities and Exchange Commission.
/s/Ernst & Young LLP
Vienna, Virginia
May 26, 1999
