<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___ to ___
Commission file number 1-12733
TOWER AUTOMOTIVE, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 41-1746238
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
4508 IDS CENTER 55402
MINNEAPOLIS, MINNESOTA (Zip Code)
(Address of principal executive offices)
(612) 342-2310
(Registrant's telephone number, including area code)
NOT APPLICABLE
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months, and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
---- ----
The number of shares outstanding of the Registrant's common stock, par value
$.01 per share, at July 15, 1998 was 46,220,152 shares adjusted for the
two-for-one stock split issued to stockholders of record on June 30, 1998.
<PAGE>
TOWER AUTOMOTIVE, INC.
FORM 10-Q
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PART I FINANCIAL INFORMATION
<S><C>
Item 1. Financial Statements:
Condensed Consolidated Statements of Operations (unaudited) for
the Three Months Ended June 30, 1998 and 1997
Condensed Consolidated Statements of Operations (unaudited) for
the Six Months Ended June 30, 1998 and 1997
Condensed Consolidated Balance Sheets at June 30, 1998
(unaudited) and December 31, 1997
Condensed Consolidated Statements of Cash Flows (unaudited) for
the Six Months Ended June 30, 1998 and 1997
Notes to Condensed Consolidated Financial Statements
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
PART II OTHER INFORMATION
</TABLE>
-2-
<PAGE>
ITEM 1 - FINANCIAL INFORMATION
TOWER AUTOMOTIVE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS - UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended June 30,
---------------------------
1998 1997
------------ -----------
<S> <C> <C>
Revenues $ 465,874 $ 327,272
Cost of sales 395,020 281,143
------------ -----------
Gross profit 70,854 46,129
Selling, general and administrative expenses 20,825 15,362
Amortization expense 3,309 2,004
------------ -----------
Operating income 46,720 28,763
Interest expense, net 12,695 6,605
------------ -----------
Income before provision for income taxes 34,025 22,158
Provision for income taxes 13,612 8,977
------------ -----------
Income before equity in earnings of joint
ventures and minority interest 20,413 13,181
Equity in earnings of joint ventures 3,973 --
Minority interest (640) --
------------ -----------
Income before extraordinary item 23,746 13,181
Extraordinary loss on early extinguishment of
debt, net of income taxes -- (2,434)
------------ -----------
Net income $ 23,746 $ 10,747
------------ -----------
------------ -----------
Basic earnings per share:
Income before extraordinary item $ 0.51 $ 0.31
Extraordinary item -- (0.06)
------------ -----------
Net income $ 0.51 $ 0.25
------------ -----------
------------ -----------
Diluted earnings per share:
Income before extraordinary item $ 0.46 $ 0.30
Extraordinary item -- (0.05)
------------ -----------
Net income $ 0.46 $ 0.25
------------ -----------
------------ -----------
</TABLE>
The accompanying notes are an integral part
of these condensed consolidated statements.
-3-
<PAGE>
TOWER AUTOMOTIVE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS - UNAUDITED)
<TABLE>
<CAPTION>
Six Months Ended June 30,
-------------------------
1998 1997
----------- ----------
<S> <C> <C>
Revenues $ 923,003 $ 452,389
Cost of sales 788,960 387,248
----------- ----------
Gross profit 134,043 65,141
Selling, general and administrative expenses 41,965 21,174
Amortization expense 6,573 2,664
----------- ----------
Operating income 85,505 41,303
Interest expense, net 24,610 7,953
----------- ----------
Income before provision for income taxes 60,895 33,350
Provision for income taxes 24,360 13,451
----------- ----------
Income before equity in earnings of joint
ventures and minority interest 36,535 19,899
Equity in earnings of joint ventures 6,671 --
Minority interest (640) --
----------- ----------
Income before extraordinary item 42,566 19,899
Extraordinary loss on early extinguishment of
debt, net of income taxes -- (2,434)
----------- ----------
Net income $ 42,566 $ 17,465
----------- ----------
----------- ----------
Basic earnings per share:
Income before extraordinary item $ 0.92 $ 0.56
Extraordinary item -- (0.07)
----------- ----------
Net income $ 0.92 $ 0.49
----------- ----------
----------- ----------
Diluted earnings per share:
Income before extraordinary item $ 0.83 $ 0.54
Extraordinary item -- (0.07)
----------- ----------
Net income $ 0.83 $ 0.47
----------- ----------
----------- ----------
</TABLE>
The accompanying notes are an integral part
of these condensed consolidated statements.
-4-
<PAGE>
TOWER AUTOMOTIVE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>
June 30, December 31,
Assets 1998 1997
- ------------------------------------------------- ------------- -------------
(unaudited)
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 49,537 $ --
Accounts receivable 254,581 219,256
Inventories 77,406 73,809
Prepaid tooling and other 93,728 78,217
------------ ------------
Total current assets $ 475,252 $ 371,282
------------ ------------
Property, plant and equipment, net $ 733,811 $ 698,511
Restricted cash 2,618 7,902
Deferred income taxes 14,108 14,108
Investments in joint ventures 203,290 147,188
Goodwill and other assets, net 477,562 441,097
------------ ------------
$ 1,906,641 $ 1,680,088
------------ ------------
------------ ------------
Liabilities and Stockholders' Investment
- -------------------------------------------------
Current liabilities:
Current maturities of long-term debt and capital
lease obligations $ 5,113 $ 5,004
Accounts payable 188,560 143,902
Accrued liabilities 117,869 81,784
------------ ------------
Total current liabilities $ 311,542 $ 230,690
------------ ------------
Long-term debt, net of current maturities $ 368,702 $ 513,653
Obligations under capital leases, net of current
maturities 27,344 30,281
Convertible subordinated notes 200,000 200,000
Other noncurrent liabilities 180,336 190,185
------------ ------------
Total non-current liabilities $ 776,382 $ 934,119
------------ ------------
Mandatorily redeemable trust convertible preferred
securities $ 258,750 $ --
Stockholders' investment:
Preferred stock $ -- $ --
Common stock 462 460
Warrants to acquire common stock 2,000 2,000
Additional paid-in capital 425,545 423,425
Retained earnings 131,960 89,394
------------ ------------
Total stockholders' investment $ 559,967 $ 515,279
------------ ------------
$ 1,906,641 $ 1,680,088
------------ ------------
------------ ------------
</TABLE>
The accompanying notes are an integral part
of these condensed consolidated balance sheets.
-5-
<PAGE>
TOWER AUTOMOTIVE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(AMOUNTS IN THOUSANDS - UNAUDITED)
<TABLE>
<CAPTION>
Six Months Ended June 30,
--------------------------
1998 1997
----------- -----------
<S> <C> <C>
OPERATING ACTIVITIES:
Net income $ 42,566 $ 17,465
Adjustments to reconcile net income to net cash
provided by operating activities -
Depreciation and amortization 41,969 16,087
Extraordinary loss on extinguishment of debt -- 2,434
Changes in other operating items 6,952 10,887
--------- ---------
Net cash provided by operating activities 91,487 46,873
--------- ---------
INVESTING ACTIVITIES:
Acquisitions and investment in joint venture (82,231) (774,882)
Capital expenditures, net (70,696) (46,435)
Change in restricted cash 5,284 (297)
--------- ---------
Net cash used in investing activities (147,643) (821,614)
FINANCING ACTIVITIES:
Proceeds from borrowings 525,553 551,878
Repayment of debt (673,332) (64,924)
Proceeds from issuance of stock 1,608 285,796
Cash portion of extraordinary loss on extinguishment
of debt -- (3,010)
Proceeds from issuance of preferred securities 251,350 --
Other, net 514 4
--------- ---------
Net cash provided by financing activities 105,693 769,744
--------- ---------
NET CHANGE IN CASH AND CASH EQUIVALENTS 49,537 (4,997)
CASH AND CASH EQUIVALENTS:
Beginning of period -- 39,596
--------- ---------
End of period $ 49,537 $ 34,599
--------- ---------
--------- ---------
</TABLE>
The accompanying notes are an integral part
of these condensed consolidated statements.
-6-
<PAGE>
TOWER AUTOMOTIVE, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. The accompanying condensed consolidated financial statements have been
prepared by Tower Automotive, Inc. (the "Company"), without audit,
pursuant to the rules and regulations of the Securities and Exchange
Commission. The information furnished in the condensed consolidated
financial statements includes normal recurring adjustments and reflects
all adjustments which are, in the opinion of management, necessary for a
fair presentation of such financial statements. Certain information and
footnote disclosures normally included in financial statements prepared
in accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such rules and regulations. Although
the Company believes that the disclosures are adequate to make the
information presented not misleading, it is suggested that these
condensed consolidated financial statements be read in conjunction with
the audited financial statements and the notes thereto included in the
Company's 1997 Annual Report to Stockholders.
Revenues and operating results for the three and six months ended June
30, 1998 are not necessarily indicative of the results to be expected
for the full year.
2. Inventories consisted of the following (in thousands):
<TABLE>
<CAPTION>
June 30, Dec. 31,
1998 1997
--------- ---------
<S> <C> <C>
Raw materials $ 20,642 $ 14,601
Work in process 31,819 38,763
Finished goods 24,945 20,445
--------- ---------
$ 77,406 $ 73,809
--------- ---------
--------- ---------
</TABLE>
3. On June 3, 1998, Tower Automotive Capital Trust (the "Issuer"), a wholly
owned statutory business trust of the Company, completed the offering of
$258.8 million of its 6-3/4% Trust Convertible Preferred Securities
("Preferred Securities"), resulting in net proceeds of approximately
$251.3 million. The Preferred Securities are redeemable, in whole or in
part, on or after June 30, 2001 and all Preferred Securities must be
redeemed no later than June 30, 2018. The Preferred Securities are
convertible, at the option of the holder, into common stock of the
Company at a rate of 1.6280 shares of common stock for each Preferred
Security, which is equivalent to a conversion price of $30.713 per
share. The net proceeds of the offering were used to repay outstanding
indebtedness.
No separate financial statements of the Issuer have been included
herein. The Company does not consider that such financial statements
would be material to holders of Preferred Securities because (i) all of
the voting securities of the Issuer are owned, directly or indirectly,
by the Company, a reporting company under the Exchange Act, (ii) the
Issuer has no independent operations and exists for the sole purpose of
issuing securities representing undivided beneficial interests in the
assets of the Issuer and investing the proceeds thereof in
-7-
<PAGE>
6-3/4% Convertible Subordinated Debentures due June 30, 2018 issued by
the Company and (iii) the obligations of the Issuer under the Preferred
Securities are fully and unconditionally guaranteed by the Company.
4. On May 19, 1998, the Company's Board of Directors approved a two-for-one
stock split, which was effected as a stock dividend. On July 15, 1998,
stockholders were issued one additional share of common stock for each
share of common stock held on the record date of June 30, 1998. All
references to the number of common shares and per share amounts have
been adjusted to reflect the stock split on a retroactive basis.
5. Basic earnings per share were computed by dividing net income by the
weighted average number of common shares outstanding during the
respective quarters. Diluted earnings per share were determined on the
assumptions: (i) the Edgewood notes were converted at the beginning of
the respective periods, (ii) the Convertible Subordinated Notes were
converted upon issuance on July 29, 1997, and (iii) the Preferred
Securities were converted upon issuance on June 3, 1998 as follows (in
thousands, except per share data):
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
------------------------ ------------------------
1998 1997 1998 1997
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Net income $ 23,746 $ 10,747 $ 42,566 $ 17,465
Interest expense on Edgewood notes,
net of tax 21 35 31 70
Interest expense on Convertible
Subordinated Notes, net of tax 1,627 -- 3,254 --
Dividends on Preferred Securities,
net of tax 640 -- 640 --
--------- --------- --------- ---------
Net income applicable to common
stockholders -- diluted $ 26,034 $ 10,782 $ 46,491 $ 17,535
--------- --------- --------- ---------
--------- --------- --------- ---------
Weighted average number of
common shares outstanding 46,204 42,520 46,142 35,598
Dilutive effect of outstanding
stock options and warrants after
application of the treasury stock method 600 548 539 504
Dilutive effect of Edgewood notes,
assuming conversion 540 816 554 817
Dilutive effect of Convertible
Subordinated Notes,
assuming conversion 7,730 -- 7,730 --
Dilutive effect of Preferred Securities,
assuming conversion 2,059 -- 1,030 --
--------- --------- --------- ---------
Diluted shares outstanding 57,133 43,884 55,995 36,919
--------- --------- --------- ---------
--------- --------- --------- ---------
Basic earnings per share $ 0.51 $ 0.25 $ 0.92 $ 0.49
--------- --------- --------- ---------
--------- --------- --------- ---------
Diluted earnings per share $ 0.46 $ 0.25 $ 0.83 $ 0.47
--------- --------- --------- ---------
--------- --------- --------- ---------
</TABLE>
-8-
<PAGE>
The Company adopted SFAS No. 128, "Earnings per Share," effective
December 15, 1997. As a result, the Company's reported earnings per
share ("EPS") for six months ended June 30, 1997 have been restated as
follows:
<TABLE>
<S> <C>
Primary EPS as reported $0.48
Effect of SFAS No. 128 0.01
-------
Basic EPS as restated $0.49
-------
-------
Fully diluted EPS as reported $0.48
Effect of SFAS No. 128 (0.01)
-------
Diluted EPS as restated $0.47
-------
-------
</TABLE>
6. Long-term debt consisted of the following (in thousands):
<TABLE>
<CAPTION>
June 30, December 31,
1998 1997
------------ ------------
<S> <C> <C>
Revolving credit facility $ 320,098 $ 465,599
Industrial development revenue bonds 43,765 43,765
Edgewood notes 1,636 1,824
Other 3,925 3,187
------------ ------------
369,424 514,375
Less-current maturities (722) (722)
------------ ------------
Total long-term debt $ 368,702 $ 513,653
------------ ------------
------------ ------------
</TABLE>
On April 18, 1997, the Company entered into a new revolving credit
facility that provides for borrowings of up to $750 million on an
unsecured basis. Under the terms of the credit facility, the equivalent
of up to $85 million in borrowings can be denominated in foreign
currency. As of June 30, 1998, approximately $80.1 million of the
outstanding borrowings are denominated in lira. The amount available
under the revolving credit facility reduces to $675 million in April
2000, $600 million in April 2001 and $500 million in April 2002. The
credit facility has a final maturity of April 2003. Interest on the
credit facility is at the prime rate or LIBOR plus a margin ranging from
17 to 50 basis points depending upon the ratio of the consolidated
indebtedness of the Company to its total capitalization. The weighted
average interest rate for such borrowings was 6.4% at June 30, 1998.
The new credit facility requires the Company to meet certain financial
covenants, including but not limited to minimum interest coverage,
minimum debt/capital and maximum leverage ratio. The Company was in
compliance with all covenants as of June 30, 1998.
On July 29, 1997, the Company completed the sale of $200 million of 5%
Convertible Subordinated Notes (the "Notes") pursuant to a private
placement. The Notes are due on August 1, 2004 and are convertible into
the Company's Common Stock at a conversion price of $25.88 per share.
The Notes are unsecured and may not be redeemed until August 1, 2000,
except in the event of a change in control. Proceeds from the Notes
were used to repay outstanding indebtedness under the revolving credit
facility.
-9-
<PAGE>
7. On April 18, 1997, the Company completed the following transactions:
(a) Issued 17,000,000 shares of Common Stock in a public offering at an
offering price of $17.50 per share (the "Offering"). Net proceeds
to the Company, after underwriting discounts and offering expenses,
were approximately $285 million.
(b) Repaid outstanding senior notes with a principal balance of $65
million plus accrued interest. In connection with the repayment,
the Company paid prepayment penalties and wrote off deferred
financing costs which resulted in an extraordinary loss, net of
income taxes, of approximately $2.4 million.
(c) Acquired and assumed substantially all of the assets and
liabilities of Automotive Products Company ("APC"), a division of
A.O. Smith Corporation. The aggregate purchase price consisted of
approximately $700 million in cash and was financed with the
proceeds from the Offering and borrowings under the new credit
facility. APC, which has 15 facilities, designs and manufactures
frames, frame components, engine cradles, suspension components and
modules for the North American automotive and heavy truck
industries. This acquisition has been accounted for using the
purchase method of accounting and, accordingly, APC's assets and
liabilities have been recorded at fair value as of the acquisition
date, with the excess purchase price recorded as goodwill.
Additional purchase liabilities recorded included approximately
$19.1 million for costs associated with the shutdown and
consolidation of certain acquired facilities and $8.9 million for
general and payroll related costs primarily for planned employee
termination activities. At June 30, 1998, liabilities of
approximately $18.6 million for facility-related costs and $4.4
million in excess payroll costs remain on the condensed
consolidated balance sheet.
Following are unaudited pro forma condensed results of operations for
the six months ended June 30, 1997 as if the following were completed at
the beginning of the period: (i) the acquisition of APC; (ii) the
refinancing of the old credit agreement and the redemption of
outstanding senior notes; (iii) the Offering; (iv) the sale of the
Notes; and (v) the issuance of the Preferred Securities. The results of
operations of APC for the period prior to its acquisition date, which
are included in the unaudited pro forma financial information, reflect
pretax charges of $66.7 million relating to losses to be incurred on
certain future contracts, valuation reserves related to capitalized
tooling and other assets and the recognition of obligations to certain
APC customers (in thousands, except per share data):
<TABLE>
<S> <C>
Revenues $ 737,363
----------
----------
Operating income $ 11,325
----------
----------
Net income $ (7,890)
----------
----------
Shares outstanding -
Basic 45,515
----------
----------
Diluted 62,991
----------
----------
Net income per share -
Basic $ (0.17)
----------
----------
Diluted $ 0.01
----------
----------
</TABLE>
-10-
<PAGE>
The unaudited pro forma financial information does not purport to
represent what the Company's results of operations would actually have
been if such transactions had occurred on such dates.
8. Effective October 1997, the Company is party to interest rate swap
contracts to hedge against interest rate exposures on certain
floating-rate indebtedness. These contracts, which expire in November
2002, have the effect of converting the floating-rate interest related
to a notional amount of $300 million of borrowings outstanding under the
revolving credit facility into fixed-rate interest of approximately
6.75%. These interest rate swap contracts were entered into in order to
balance the Company's fixed-rate and floating-rate debt portfolios.
Under these interest rate swaps, the Company agrees with the other party
to exchange, at specified intervals, the difference between fixed-rate
and floating-rate interest amounts calculated by reference to an agreed
notional principal amount. While the Company is exposed to credit loss
on its interest rate swap in the event of nonperformance by the
counterparty to such swap, management believes that such nonperformance
is unlikely to occur given the financial resources of the counterparty.
9. On May 9, 1997, the Company acquired Societa Industria Meccanica e
Stampaggio S.p.A. ("SIMES"). SIMES designs and manufactures structural
metal components in two facilities in Italy, principally for Fiat. The
purchase price consisted of $50.7 million in cash, plus an additional $3
million based upon the future operating performance of SIMES. The
results of operations of SIMES are not significant to the operating
results of the Company as a whole and have, therefore, been excluded
from the pro forma results included in Note 7.
10. On October 9, 1997, the Company completed an agreement to become a
partner in Metalsa S. de R.L. ("Metalsa") with Promotora de Empresas
Zano, S.A. de C.V. ("Proeza"). Metalsa is the largest supplier of
vehicle frames and structures in Mexico. Under the terms of the
agreement, the Company acquired a 40% equity interest in Metalsa. In
addition, the parties have entered into a technology sharing arrangement
that will enable both companies to utilize the latest available product
and process technology. Metalsa is headquartered in Monterrey, Mexico
and has manufacturing facilities in Monterrey and San Luis Potosi,
Mexico. Metalsa's customers include Chrysler, General Motors, Ford,
Nissan and Mercedes. In connection with this agreement, the Company
paid $120 million to Proeza, with an additional amount of up to $45
million payable based upon future net earnings of Metalsa.
11. On March 11, 1998, the Company acquired a 40 percent equity interest in
Metalurgica Caterina S.A. ("Caterina"), a supplier of structural
stampings and assemblies to the Brazilian automotive market. In
addition, the Company also has the right to acquire the remaining 60
percent of the equity of Caterina in the future. The Company paid
approximately $48 million for its initial equity interest. This
investment added Volkswagen and Mercedes as new customers.
12. Effective July 1, 1998, the Company acquired IMAR, s.r.l. ("IMAR") and
OSLAMT S.p.A. ("OSLAMT"). IMAR designs and manufactures structural
parts and assemblies from two facilities in Italy, primarily for Fiat.
OSLAMT designs and manufactures tools and assemblies for the automotive
market from its facility in Turin, Italy. The purchase price consisted
of approximately $32.5 million in cash plus the assumption of
approximately $17 million of indebtedness with an additional amount of
up to $15 million payable if IMAR
-11-
<PAGE>
achieves certain operating targets following the acquisition. The
results of operations of IMAR and OSLAMT are not significant to the
operating results of the Company as a whole and have, therefore, been
excluded from the pro forma results included in Note 7.
13. Effective January 1, 1998, the Company adopted SFAS No. 130, "Reporting
Comprehensive Income." This statement established standards for
reporting and display of comprehensive income and its components.
Comprehensive income reflects the change in equity of a business
enterprise during a period from transactions and other events and
circumstances from non-owner sources. For the Company, comprehensive
income represents net income adjusted for foreign currency translation
adjustments. Comprehensive income was approximately $42.6 million and
$17.5 million for the six months ended June 30, 1998 and 1997,
respectively.
The Financial Accounting Standards Board ("FASB") has issued SFAS No.
131, "Disclosures about Segments of an Enterprise and Related
Information," effective for fiscal years beginning after December 15,
1997. SFAS No. 131 requires disclosure of business and geographic
segments in the consolidated financial statements of the Company. The
Company will adopt SFAS No. 131 in 1998 and is currently analyzing the
impact it will have on the disclosures in its financial statements.
The FASB has also issued SFAS No. 132, "Employers' Disclosures about
Pensions and Other Postretirement Benefits," effective for fiscal years
beginning after December 31, 1997. SFAS No. 132 revises certain of the
disclosure requirements, but does not change the measurement or
recognition of those plans. SFAS No. 132 superceded SFAS No. 106,
"Employers' Accounting for Postretirement Benefits Other Than Pensions."
The adoption of SFAS No. 132 will result in revised and additional
disclosures, but will have no effect on the financial position, results
of operations, or liquidity of the Company.
In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities," effective for the years beginning
after June 15, 1999. SFAS 133 establishes accounting and reporting
standards requiring that every derivative instrument, including certain
derivative instruments embedded in other contracts, be recorded in the
balance sheet as either an asset or liability measured at its fair
value. SFAS No. 133 requires that changes in the derivative's fair value
be recognized currently in earnings unless specific hedge criteria are
met. Special accounting for qualifying hedges allow a derivative's gains
or losses to offset related results on the hedged item in the income
statement and requires that a company must formally document, designate
and assess the effectiveness of transactions that receive hedge
accounting. The Company has not yet quantified the impact of adopting
SFAS No. 133 and has not yet determined the timing or method of adoption.
14. Supplemental cash flow information (in thousands):
<TABLE>
<CAPTION>
Three Months Ended June 30, Six Months Ended June 30,
--------------------------- --------------------------
1998 1997 1998 1997
----------- ----------- ----------- ----------
<S> <C> <C> <C> <C>
Cash paid for -
Interest $ 8,479 $ 5,215 $ 22,606 $ 5,974
Income taxes 4,450 4,540 5,208 7,080
</TABLE>
-12-
<PAGE>
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
COMPARISON OF THE THREE MONTHS ENDED JUNE 30, 1998 TO THE THREE MONTHS ENDED
JUNE 30, 1997
REVENUES -- Revenues for the three months ended June 30, 1998 were $465.9
million, compared to $327.3 million for the three months ended June 30, 1997.
The increase is due to the acquisitions of Automotive Products Company
("APC") in April 1997 and Societa Industria Meccanica e Stampaggio S.p.A.
("SIMES") in May 1997 and incremental new business, including business
relating to the Ford Econoline, F-Series and Explorer, Dodge Durango, Dakota
and Ram Club Cab pick-ups and the Chrysler LH line offset by a decline in
production of certain models served by the Company. The General Motors
strike had the effect of reducing revenues by approximately $13 million
during the quarter.
COST OF SALES -- Cost of sales as a percentage of revenues for the three
months ended June 30, 1998 was 84.8% compared to 85.9% for the three months
ended June 30, 1997. The increase in gross margin was due to operating
efficiencies and productivity initiatives implemented particularly at certain
of the Company's business units acquired from A.O. Smith Corporation in 1997
as well as increased production volumes on models served by the Company.
These increases were partially offset by a higher proportion of components
purchased from outside suppliers as a result of the APC acquisition, launch
costs associated with new business and the effects of the General Motors
strike.
S, G & A EXPENSES -- Selling, general and administrative expenses increased
to $20.8 million, or 4.5% of revenues, for the three months ended June 30,
1998 compared to $15.4 million, or 4.7% of revenues, for the three months
ended June 30, 1997. The increased expense was due primarily to incremental
costs associated with the Company's acquisitions of APC and SIMES as well as
increased engineering and program development costs related to new business.
AMORTIZATION EXPENSE -- Amortization expense for the three months ended June
30, 1998 was $3.3 million compared to $2.0 million for the three months ended
June 30, 1997. The increase was due to incremental goodwill amortization
related to the acquisitions of APC and SIMES.
INTEREST EXPENSE -- Interest expense for the three-month period ended June
30, 1998 was $12.7 million compared to $6.6 million for the three months
ended June 30, 1997. Interest expense was affected by (i) increased
borrowings incurred to fund the Company's joint venture interests in Metalsa
S. de R.L. ("Metalsa") in October 1997 and Metalurgica Caterina S.A.
("Caterina") in March 1998, (ii) the proceeds from the July 1997 sale of $200
million of 5% Convertible Subordinated Notes (the "Notes") and (iii) the
proceeds from the June 1998 offering of $258.8 million of its 6-3/4% Trust
Convertible Preferred Securities ("Preferred Securities").
INCOME TAXES -- The effective income tax rate was 40% for the three months
ended June 30, 1998 and 1997. The effective rates differed from the
statutory rates primarily as a result of state taxes and non-deductible
goodwill amortization.
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<PAGE>
COMPARISON OF THE SIX MONTHS ENDED JUNE 30, 1998 TO THE SIX MONTHS ENDED JUNE
30, 1997
REVENUES -- Revenues for the six months ended June 30, 1998 were $923.0
million, a substantial increase compared to $452.4 million for the six months
ended June 30, 1997. The increase is due to the acquisitions of APC and
SIMES and new business awarded to the Company, including business relating to
the Ford Explorer and Econoline, Dodge Durango, Dakota and Ram Club Cab
pick-ups and the Chrysler LH line offset by a decline in production of
certain models served by the Company. The General Motors strike had the
effect of reducing revenues by approximately $13 million during 1998.
COST OF SALES -- Cost of sales as a percentage of revenues for the six
months ended June 30, 1998 was 85.5% compared to 85.6% for the six months
ended June 30, 1997. The increase in gross margin was due to operating
efficiencies and productivity initiatives implemented particularly at certain
of the Company's business units acquired from A.O. Smith Corporation in 1997
as well as increased production volumes on models served by the Company.
These increases were partially offset by a higher proportion of components
purchased from outside suppliers as a result of the APC acquisition, launch
costs associated with new business and the effects of the General Motors
strike.
S, G & A EXPENSES -- Selling, general and administrative expenses increased
to $42.0 million, or 4.5% of revenues, for the six months ended June 30, 1998
compared to $21.2 million, or 4.7% of revenues, for the six months ended June
30, 1997. The increased expense was due primarily to incremental costs
associated with the Company's acquisitions of APC and SIMES as well as
increased engineering and program development costs related to new business.
AMORTIZATION EXPENSE -- Amortization expense for the six months ended June
30, 1998 was $6.6 million compared to $2.7 million for the six months ended
June 30, 1997. The increase was due to incremental goodwill amortization
related to the acquisitions of APC and SIMES.
INTEREST EXPENSE -- Interest expense for the six-month period ended June
30, 1998 was $24.6 million compared to $8.0 million for the six months ended
June 30, 1997. Interest expense was affected by (i) increased borrowings
incurred to fund the acquisitions of APC and SIMES, and the Company's joint
venture interests in Metalsa and Caterina, (ii) more favorable terms related
to the Company's borrowings under the credit agreement entered into in April
1997, (iii) the proceeds from the April 1997 offering of 17,000,000 shares of
Common Stock at $17.50 per share (the "Offering"), (iv) the proceeds from the
July 1997 sale of the Notes and (v) the proceeds from the June 1998 offering
of Preferred Securities.
INCOME TAXES -- The effective income tax rate was 40% for the six months
ended June 30, 1998 and 1997. The effective rates differed from the
statutory rates primarily as a result of state taxes and non-deductible
goodwill amortization.
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LIQUIDITY AND CAPITAL RESOURCES
In April 1997, the Company entered into a new revolving credit facility that
provides for borrowings of up to $750 million on an unsecured basis. Under
the terms of the credit facility, the equivalent of up to $85 million in
borrowings can be denominated in foreign currency. As of June 30, 1998,
approximately $80.7 million of the $320.1 million outstanding borrowings are
denominated in lira. The amount available under the revolving credit
facility reduces to $675 million in April 2000, $600 million in April 2001
and $500 million in April 2002. The credit facility has a final maturity of
April 2003. Interest on the credit facility is at the prime rate or LIBOR
plus a margin ranging from 17 to 50 basis points depending upon the ratio of
the consolidated indebtedness of the Company to its total capitalization.
The weighted average interest rate for such borrowings was 6.4% at June 30,
1998.
In July 1997, the Company completed the sale of the Notes pursuant to a
private placement. The Notes are due on August 1, 2004 and are convertible
into the Company's Common Stock at a conversion price of $25.88 per share.
The Notes are unsecured and may not be redeemed until August 1, 2000, except
in the event of a change in control. Proceeds from the Notes were used to
repay outstanding indebtedness under the revolving credit facility.
Effective October 1997, the Company is party to interest rate swap contracts
to hedge against interest rate exposures on certain floating-rate
indebtedness. These contracts, which expire in November 2002, have the effect
of converting the floating-rate interest related to a notional amount of $300
million of borrowings outstanding under the revolving credit facility into
fixed-rate interest of approximately 6.75%. These interest rate swap
contracts were entered into in order to balance the Company's fixed-rate and
floating-rate debt portfolios. Under these interest rate swaps, the Company
agrees with the other party to exchange, at specified intervals, the
difference between fixed-rate and floating-rate interest amounts calculated
by reference to an agreed notional principal amount
On May 19, 1998, the Company's Board of Directors approved a two-for-one
stock split, which was effected as a stock dividend. On July 15, 1998,
stockholders were issued one additional share of common stock for each share
of common stock held on the record date of June 30, 1998. All references to
the number of common shares and per share amounts have been adjusted to
reflect the stock split on a retroactive basis.
On June 3, 1998, Tower Automotive Capital Trust (the "Issuer"), a wholly
owned statutory business trust of the Company, completed the offering of
$258.8 million of its 6-3/4% Trust Convertible Preferred Securities
("Preferred Securities"), resulting in net proceeds of approximately $251.3
million. The Preferred Securities are redeemable, in whole or in part, on or
after June 30, 2001 and all Preferred Securities must be redeemed no later
than June 30, 2018. The Preferred Securities are convertible, at the option
of the holder, into common stock of the Company at a rate of 1.6280 shares of
common stock for each Preferred Security, which is equivalent to a conversion
price of $30.713 per share. The net proceeds of the offering were used to
repay outstanding indebtedness.
The Company financed the cash portion of the MSTI acquisition through the
issuance of two series of senior notes having an aggregate principal amount
of $65 million. The senior notes were retired in connection with the
Offering and the new revolving credit facility described above. In
connection with the retirement, the Company paid prepayment penalties and
wrote off
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<PAGE>
deferred financing costs which resulted in an extraordinary loss, net of
income taxes, of approximately $2.4 million.
The debt agreements described above contain various restrictive covenants
which, among other matters, require the Company to maintain certain financial
ratios, including but not limited to interest coverage, debt to capital and
total leverage. The agreements also limit additional indebtedness, capital
expenditures and cash dividends. The Company was in compliance with all debt
covenants as of June 30, 1998.
On April 18, 1997, the Company acquired APC, a division of A.O. Smith
Corporation. The aggregate purchase price was approximately $700 million and
was financed with the proceeds from the Offering and borrowings under the new
credit facility. APC, which has 15 facilities, designs and manufactures
frames, frame components, engine cradles, suspension components and modules
for the North American automotive and heavy truck industries.
On May 9, 1997, the Company acquired SIMES, headquartered in Turin, Italy.
SIMES designs and manufactures structural metal components in two facilities
in Italy, principally for Fiat. The purchase price was approximately $50.7
million and was financed with borrowings under the Company's revolving credit
facility. The Company may pay an additional $3 million in the future if
certain operating targets are met by SIMES.
On October 9, 1997, the Company completed an agreement to become a partner in
Metalsa with Promotora de Empresas Zano, S.A. de C.V. ("Proeza"). Metalsa is
the largest supplier of vehicle frames and structures in Mexico. Under the
terms of the agreement, the Company acquired a 40 percent equity interest in
Metalsa. In addition, the parties have entered into a technology sharing
arrangement that will enable both companies to utilize the latest available
product and process technology. Metalsa is headquartered in Monterrey,
Mexico and has manufacturing facilities in Monterrey and San Luis Potosi,
Mexico. Metalsa's customers include Chrysler, General Motors, Ford, Nissan
and Mercedes. In connection with this agreement, the Company paid $120
million to Proeza, with an additional amount of up to $45 million payable
based upon the net earnings of Metalsa in 1998, 1999 and 2000. The
investment in Metalsa was financed with proceeds from borrowings under the
Company's revolving credit facility.
On March 11, 1998, the Company acquired a 40 percent equity interest in
Caterina, a supplier of structural stampings and assemblies to the Brazilian
automotive market. In addition, the Company also has the right to acquire
the remaining 60 percent of the equity of Caterina in the future. The
Company paid approximately $48 million for its initial equity interest. This
investment added Volkswagen and Mercedes as new customers.
Effective July 1, 1998, the Company acquired IMAR, s.r.l. ("IMAR") and OSLAMT
S.p.A. ("OSLAMT"). IMAR designs and manufactures structural parts and
assemblies from two facilities in Italy, primarily for Fiat. OSLAMT designs
and manufactures tools and assemblies for the automotive market from its
facility in Turin, Italy. The purchase price consisted of approximately
$32.5 million in cash plus the assumption of approximately $17 million of
indebtedness with an additional amount of up to $15 million payable if IMAR
achieves certain operating targets following the acquisition.
During the six months ended June 30, 1998, the Company generated $91.5
million of cash from operations, which was used to partially fund capital
expenditures.
-16-
<PAGE>
The Company has made substantial investments in manufacturing technology and
product design capability to support its products. The Company made capital
expenditures of approximately $70.7 million for the six months ended June 30,
1998, primarily for equipment and dedicated tooling purchases related to new
or replacement programs.
The Company believes the borrowing availability under its credit agreement,
together with funds generated by operations, should provide liquidity and
capital resources to pursue its business strategy through 1998, with respect
to working capital, capital expenditures and other operating needs. Under
present conditions, management does not believe access to funds will restrict
its ability to pursue its acquisition strategy.
For the year ended December 31, 1997, General Motors ("GM") accounted for
approximately 13% of the Company's revenues. GM experienced a seven week
strike at certain of its production facilities due to a labor dispute between
GM and the UAW. The Company expects this strike will negatively impact
revenues by approximately $15 million for the third quarter.
EFFECTS OF INFLATION
Inflation generally affects the Company by increasing the interest expense of
floating-rate indebtedness and by increasing the cost of labor, equipment and
raw materials. Management believes that inflation has not significantly
effected the Company's business over the past 12 months. However, because
selling prices generally cannot be increased until a model changeover, the
effects of inflation must be offset by productivity improvements and volume
from new business awards.
YEAR 2000
The Company is in the process of modifying its computer systems to
accommodate the year 2000 and currently expects to complete this modification
sufficiently in advance of the year 2000 so as not to adversely affect its
operations. The Company does not expect to incur more than $5 million of
total costs in connection with these year 2000 modifications. Failure of the
Company to make required modifications on a timely basis or the inability of
other companies with which the Company does business to complete their year
2000 modifications on a timely basis, could adversely effect the Company's
operations.
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
The Financial Accounting Standards Board ("FASB") has released SFAS No. 131,
"Disclosures about Segments of an Enterprise and related Information,"
effective for fiscal years beginning after December 15, 1997. SFAS No. 131
requires disclosure of business and geographic segments in the consolidated
financial statements of the Company. The Company will adopt SFAS No. 131 in
1998 and is currently analyzing the impact it will have on the disclosures in
its financial statements.
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<PAGE>
The FASB has also SFAS No. 132, "Employers' Disclosures about Pensions and
Other Postretirement Benefits," effective for fiscal years beginning after
December 31, 1997. SFAS No. 132 revises certain of the disclosure
requirements, but does not change the measurement or recognition of those
plans. SFAS No. 132 superceded SFAS No. 106, "Employers' Accounting for
Postretirement Benefits Other Than Pensions." The adoption of SFAS No. 132
will result in revised and additional disclosures, but will have no effect on
the financial position, results of operations, or liquidity of the Company.
In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities," effective for the years beginning after
June 15, 1999. SFAS 133 establishes accounting and reporting standards
requiring that every derivative instrument, including certain derivative
instruments embedded in other contracts, be recorded in the balance sheet as
either an asset or liability measured at its fair value. SFAS No. 133
requires that changes in the derivative's fair value be recognized currently
in earnings unless specific hedge criteria are met. Special accounting for
qualifying hedges allow a derivative's gains or losses to offset related
results on the hedged item in the income statement and requires that a
company must formally document, designate and assess the effectiveness of
transactions that receive hedge accounting. The Company has not yet
quantified the impact of adopting SFAS No. 133 and has not yet determined the
timing or method of adoption.
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PART II. OTHER INFORMATION
TOWER AUTOMOTIVE, INC. AND SUBSIDIARIES
Item 1. Legal Proceedings:
None
Item 2. Change in Securities:
On May 19, 1998, the Company's Board of Directors approved a
two-for-one stock split, which was effected as a stock dividend.
On July 15, 1998, stockholders were issued one additional share of
common stock for each share of common stock held on the record date
of June 30, 1998. A total of 23,110,076 shares of common stock
were issued in connection with the split.
On June 3, 1998, Tower Automotive Capital Trust, a wholly owned
statutory business trust of the Company, completed an offering of
5,175,000 shares of its 6-3/4% Trust Convertible Preferred
Securities ("Preferred Securities") in a private placement.
Donaldson, Lufkin & Jenrette Securities Corporation, Robert W.
Baird & Co., Incorporated, Merrill Lynch & Co. and PaineWebber
Incorporated served as initial purchasers of the Preferred
Securities. The Preferred Securities are convertible at any time,
at the option of the holders, into approximately 8,425,000 shares
of common stock of the Company.
Item 3. Defaults Upon Senior Securities:
None
Item 4. Submission of Matters to a Vote of Security Holders:
The registrant held its Annual Meeting of Stockholders on May 19,
1998. Proxies for the meeting were solicited pursuant to
Regulation 14; there was no solicitation in opposition to
management's nominees for directors as listed in the Proxy
Statement, and all such nominees (S.A. Johnson, Adrian
VanderStarre, Dugald K. Campbell, Kim B. Clark, W.H. Clement,
Matthew O. Diggs, Jr., F.J. Loughrey, James R. Lozelle, Eric J.
Rosen, Scott D. Rued and Enrique Zambrano) were elected. Of the
39,636,002 shares voted, at least 39,565,624 shares granted
authority to vote for these directors and no more than 70,376
abstaining votes were cast.
The retention of Arthur Andersen LLP as independent public
accountants of the Company was approved by the stockholders. A
total of 39,568,360 affirmative votes, 57,044 negative votes and
10,598 abstaining votes were cast.
Item 5. Other Information:
None
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Item 6. Exhibits and Reports on Form 8-K:
(a) Exhibits:
4.1 Certificate of Trust of Tower Automotive Capital Trust.
4.2 Amended and Restated Declaration of Trust of Tower
Automotive Capital Trust, dated as of June 9, 1998.
4.3 Junior Convertible Subordinated Indenture for the 6-3/4%
Convertible Subordinated Debentures, between Tower
Automotive, Inc. and the First National Bank of Chicago,
as Subordinated Debt Trustee, dated as of June 9, 1998.
4.4 Form of 6-3/4% Preferred Securities (included as
Exhibit D to the Amended and Restated Declaration of Trust
filed herewith as Exhibit 4.2).
4.5 Form of 6-3/4% Junior Convertible Subordinated
Debentures (included in Article 2 of the Junior
Convertible Subordinated Indenture filed herewith as
Exhibit 4.3).
4.6 Guarantee Agreement, dated as of June 9, 1998, between
Tower Automotive, Inc., as Guarantor, and The First
National Bank of Chicago, as Guarantee Trustee.
4.7 Registration Rights Agreement, dated June 9, 1998, among
Tower Automotive Capital Trust and Donaldson, Lufkin &
Jenrette Securities Corporation, Robert W. Baird & Co.
Incorporated, Merrill Lynch & Co. and PaineWebber
Incorporated, as Initial Purchasers.
27.1 Financial Data Schedule.
(b) During the quarter for which this report is filed, the Company
filed no Form 8-K Current reports with the Securities and
Exchange Commission.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
TOWER AUTOMOTIVE, INC.
Date: August 14, 1998 By /s/ Anthony A. Barone
---------------------------------------
Anthony A. Barone
Vice President, Chief Financial Officer
(principal accounting and financial
officer)
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CERTIFICATE OF TRUST
OF
TOWER AUTOMOTIVE CAPITAL TRUST
THIS Certificate of Trust of Tower Automotive Capital Trust (the
"Trust"), dated as of June 3, 1998, is being duly executed and filed by the
undersigned, as trustees, to form a business trust under the Delaware
Business Trust Act (12 DEL. C. Section 3801 ET SEQ.).
1. NAME. The name of the business trust formed hereby is Tower
Automotive Capital Trust.
2. DELAWARE TRUSTEE. The name and business address of the
trustee of the Trust with a principal place of business in the State of
Delaware are First Chicago Delaware Inc., 300 King Street, Wilmington,
Delaware 1980.
3. EFFECTIVE DATE. This Certificate of Trust shall be effective
upon filing.
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust,
have executed this Certificate of Trust as of the date first-above written.
FIRST NATIONAL BANK OF CHICAGO, not in
its individual capacity but solely
as trustee of the Trust
By: /s/ Steven M. Wagner
----------------------------------
Name: Steven M. Wagner
--------------------------------
Title: Vice President
--------------------------------
Anthony A. Barone, not in his individual
capacity but solely as trustee of
the Trust
/s/ Anthony A. Barone
---------------------------------------
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
AMENDED AND RESTATED
DECLARATION OF TRUST
AMONG
TOWER AUTOMOTIVE, INC.
AS DEPOSITOR,
THE FIRST NATIONAL BANK OF CHICAGO
AS PROPERTY TRUSTEE,
FIRST CHICAGO DELAWARE INC.
AS DELAWARE TRUSTEE,
AND
THE ADMINISTRATIVE TRUSTEES NAMED HEREIN
DATED AS OF JUNE 9, 1998
TOWER AUTOMOTIVE CAPITAL TRUST
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
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ARTICLE 1
DEFINED TERMS
SECTION 1.1. DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE 2
ESTABLISHMENT OF THE TRUST
SECTION 2.1. NAME . . . . . . . . . . . . . . . . . . . . . . . . . . .12
SECTION 2.2. OFFICE OF THE DELAWARE TRUSTEE; PRINCIPAL PLACE OF
BUSINESS . . . . . . . . . . . . . . . . . . . . . . . . .12
SECTION 2.3. ORGANIZATIONAL EXPENSES. . . . . . . . . . . . . . . . . .12
SECTION 2.4. ISSUANCE OF THE PREFERRED SECURITIES . . . . . . . . . . .12
SECTION 2.5. SUBSCRIPTION AND PURCHASE OF DEBENTURES; ISSUANCE OF
THE COMMON SECURITIES. . . . . . . . . . . . . . . . . . .12
SECTION 2.6. DECLARATION OF TRUST . . . . . . . . . . . . . . . . . . .12
SECTION 2.7. AUTHORIZATION TO ENTER INTO CERTAIN TRANSACTIONS . . . . .13
SECTION 2.8. ASSETS OF TRUST. . . . . . . . . . . . . . . . . . . . . .16
SECTION 2.9. TITLE TO TRUST PROPERTY. . . . . . . . . . . . . . . . . .16
ARTICLE 3
PAYMENT ACCOUNT
SECTION 3.1. PAYMENT ACCOUNT. . . . . . . . . . . . . . . . . . . . . .17
ARTICLE 4
DISTRIBUTIONS; REDEMPTION; EXCHANGE; CONVERSION
SECTION 4.1. DISTRIBUTIONS. . . . . . . . . . . . . . . . . . . . . . .17
SECTION 4.2. REDEMPTION . . . . . . . . . . . . . . . . . . . . . . . .18
SECTION 4.3. CONVERSION . . . . . . . . . . . . . . . . . . . . . . . .20
SECTION 4.4. SPECIAL EVENT EXCHANGE OR REDEMPTION . . . . . . . . . . .22
SECTION 4.5. SUBORDINATION OF COMMON SECURITIES . . . . . . . . . . . .24
SECTION 4.6. PAYMENT PROCEDURES.. . . . . . . . . . . . . . . . . . . .24
SECTION 4.7. TAX RETURNS AND REPORTS. . . . . . . . . . . . . . . . . .24
SECTION 4.8. PAYMENT OF TAXES, DUTIES, ETC. OF THE TRUST. . . . . . . .25
SECTION 4.9. PAYMENTS UNDER SUBORDINATED INDENTURE. . . . . . . . . . .25
ARTICLE 5
TRUST SECURITIES CERTIFICATES
SECTION 5.1. INITIAL OWNERSHIP. . . . . . . . . . . . . . . . . . . . .25
SECTION 5.2. THE TRUST SECURITIES CERTIFICATES. . . . . . . . . . . . .25
SECTION 5.3. DELIVERY OF TRUST SECURITIES CERTIFICATES. . . . . . . . .26
SECTION 5.4. REGISTRATION OF TRANSFER AND EXCHANGE OF PREFERRED
SECURITIES . . . . . . . . . . . . . . . . . . . . . . . .26
SECTION 5.5. MUTILATED, DESTROYED, LOST OR STOLEN TRUST SECURITIES
CERTIFICATES . . . . . . . . . . . . . . . . . . . . . . .29
SECTION 5.6. PERSONS DEEMED SECURITYHOLDERS . . . . . . . . . . . . . .29
SECTION 5.7. ACCESS TO LIST OF SECURITYHOLDERS' NAMES AND
ADDRESSES. . . . . . . . . . . . . . . . . . . . . . . . .29
SECTION 5.8. MAINTENANCE OF OFFICE OR AGENCY. . . . . . . . . . . . . .30
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SECTION 5.9. APPOINTMENT OF PAYING AGENT. . . . . . . . . . . . . . . .30
SECTION 5.10. OWNERSHIP OF COMMON SECURITIES BY DEPOSITOR. . . . . . . .30
SECTION 5.11. GLOBAL SECURITIES; NON-GLOBAL SECURITIES; COMMON
SECURITIES CERTIFICATE . . . . . . . . . . . . . . . . . .31
SECTION 5.12. NOTICES TO CLEARING AGENCY . . . . . . . . . . . . . . . .32
SECTION 5.13. DEFINITIVE PREFERRED SECURITIES CERTIFICATES . . . . . . .32
SECTION 5.14. RIGHTS OF SECURITYHOLDERS. . . . . . . . . . . . . . . . .32
SECTION 5.15. RESTRICTIVE LEGEND . . . . . . . . . . . . . . . . . . . .32
ARTICLE 6
ACT OF SECURITYHOLDERS; MEETINGS; VOTING
SECTION 6.1. LIMITATIONS ON VOTING RIGHTS . . . . . . . . . . . . . . .33
SECTION 6.2. VOTING RIGHTS OF COMMON SECURITIES . . . . . . . . . . . .36
SECTION 6.3. MEETINGS OF THE HOLDERS OF TRUST SECURITIES; ACTION
BY WRITTEN CONSENT . . . . . . . . . . . . . . . . . . . .37
SECTION 6.4. ACTS OF SECURITYHOLDERS. . . . . . . . . . . . . . . . . .38
SECTION 6.5. INSPECTION OF RECORDS. . . . . . . . . . . . . . . . . . .39
ARTICLE 7
REPRESENTATIONS AND WARRANTIES
SECTION 7.1. REPRESENTATIONS AND WARRANTIES OF THE PROPERTY TRUSTEE
AND THE DELAWARE TRUSTEE . . . . . . . . . . . . . . . . .39
SECTION 7.2. REPRESENTATIONS AND WARRANTIES OF DEPOSITOR. . . . . . . .40
ARTICLE 8
THE TRUSTEES
SECTION 8.1. CERTAIN DUTIES AND RESPONSIBILITIES. . . . . . . . . . . .40
SECTION 8.2. NOTICE OF DEFAULTS . . . . . . . . . . . . . . . . . . . .42
SECTION 8.3. CERTAIN RIGHTS OF PROPERTY TRUSTEE . . . . . . . . . . . .44
SECTION 8.4. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF
SECURITIES . . . . . . . . . . . . . . . . . . . . . . . .46
SECTION 8.5. MAY HOLD SECURITIES. . . . . . . . . . . . . . . . . . . .46
SECTION 8.6. COMPENSATION; INDEMNITY; FEES. . . . . . . . . . . . . . .46
SECTION 8.7. PROPERTY TRUSTEE REQUIRED; ELIGIBILITY OF TRUSTEES . . . .47
SECTION 8.8. CONFLICTING INTERESTS. . . . . . . . . . . . . . . . . . .47
SECTION 8.9. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR. . . . .48
SECTION 8.10. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR . . . . . . . . . .49
SECTION 8.11. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION
TO BUSINESS. . . . . . . . . . . . . . . . . . . . . . . .50
SECTION 8.12. PREFERENTIAL COLLECTION OF CLAIMS AGAINST DEPOSITOR
OR TRUST . . . . . . . . . . . . . . . . . . . . . . . . .50
SECTION 8.13. REPORTS BY PROPERTY TRUSTEE. . . . . . . . . . . . . . . .50
SECTION 8.14. REPORTS TO THE PROPERTY TRUSTEE. . . . . . . . . . . . . .51
SECTION 8.15. EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT . . . . .51
SECTION 8.16. NUMBER OF TRUSTEES . . . . . . . . . . . . . . . . . . . .51
SECTION 8.17. DELEGATION OF POWER. . . . . . . . . . . . . . . . . . . .52
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ARTICLE 9
DISSOLUTION, LIQUIDATION AND MERGER
SECTION 9.1. DISSOLUTION UPON EXPIRATION DATE . . . . . . . . . . . . .52
SECTION 9.2. EARLY DISSOLUTION. . . . . . . . . . . . . . . . . . . . .52
SECTION 9.3. DISSOLUTION. . . . . . . . . . . . . . . . . . . . . . . .53
SECTION 9.4. LIQUIDATION. . . . . . . . . . . . . . . . . . . . . . . .53
SECTION 9.5. MERGERS, CONSOLIDATIONS, AMALGAMATIONS OR
REPLACEMENTS OF THE TRUST. . . . . . . . . . . . . . . . .54
ARTICLE 10
MISCELLANEOUS PROVISIONS
SECTION 10.1. LIMITATION OF RIGHTS OF SECURITYHOLDERS. . . . . . . . . .55
SECTION 10.2. AMENDMENTS . . . . . . . . . . . . . . . . . . . . . . . .55
SECTION 10.3. SEPARABILITY . . . . . . . . . . . . . . . . . . . . . . .58
SECTION 10.4. GOVERNING LAW. . . . . . . . . . . . . . . . . . . . . . .58
SECTION 10.5. PAYMENTS DUE ON NON-BUSINESS DAY . . . . . . . . . . . . .58
SECTION 10.6. SUCCESSORS . . . . . . . . . . . . . . . . . . . . . . . .58
SECTION 10.7. HEADINGS . . . . . . . . . . . . . . . . . . . . . . . . .58
SECTION 10.8. REPORTS, NOTICES AND DEMANDS . . . . . . . . . . . . . . .58
SECTION 10.9. AGREEMENT NOT TO PETITION. . . . . . . . . . . . . . . . .59
SECTION 10.10. TRUST INDENTURE ACT; CONFLICT WITH TRUST INDENTURE
ACT. . . . . . . . . . . . . . . . . . . . . . . . . . . .59
SECTION 10.11. ACCEPTANCE OF TERMS OF DECLARATION, GUARANTEE AND
SUBORDINATEDINDENTURE. . . . . . . . . . . . . . . . . . .59
SECTION 10.12. COUNTERPARTS . . . . . . . . . . . . . . . . . . . . . . .59
</TABLE>
EXHIBIT A -- Certificate of Trust of
Tower Automotive Capital Trust
EXHIBIT B -- Form of Certificate
Depositary Agreement
EXHIBIT C -- Form of Common Securities of
Tower Automotive Capital Trust
EXHIBIT D -- Form of Preferred Securities of
Tower Automotive Capital Trust
EXHIBIT E -- Form of Restricted
Securities Certificate
EXHIBIT F -- Form of Unrestricted
Securities Certificate
EXHIBIT G -- Notice of Conversion
iii
<PAGE>
Tower Automotive Capital Trust
Certain Sections of this Declaration
relating to Sections 310 through 318
of the Trust Indenture Act of 1939:
<TABLE>
<CAPTION>
TRUST INDENTURE DECLARATION
ACT SECTION SECTION
- --------------- --------
<S> <C> <C>
Section 310 (a)(1) . . . . . . . . . . . . . . . . . 8.7
(a)(2) . . . . . . . . . . . . . . . . . 8.7
(a)(3) . . . . . . . . . . . . . . . . . Not Applicable
(a)(4) . . . . . . . . . . . . . . . . . 2.7(a)(ii)
(b) . . . . . . . . . . . . . . . . . 8.8
Section 311 (a) . . . . . . . . . . . . . . . . . 8.12
(b) . . . . . . . . . . . . . . . . . 8.12
Section 312 (a) . . . . . . . . . . . . . . . . . 5.7
(b) . . . . . . . . . . . . . . . . . 5.7
(c) . . . . . . . . . . . . . . . . . 5.7
Section 313 (a) . . . . . . . . . . . . . . . . . 8.13(a)
(c) . . . . . . . . . . . . . . . . . 10.8
(d) . . . . . . . . . . . . . . . . . 8.13(c)
(a)(4) . . . . . . . . . . . . . . . . . 8.13(b)
(b) . . . . . . . . . . . . . . . . . 8.13(b)
Section 314 (a) . . . . . . . . . . . . . . . . . 8.14
(b) . . . . . . . . . . . . . . . . . Not Applicable
(c)(1) . . . . . . . . . . . . . . . . . 8.15
(c)(2) . . . . . . . . . . . . . . . . . 8.15
(c)(3) . . . . . . . . . . . . . . . . . Not Applicable
(d) . . . . . . . . . . . . . . . . . Not Applicable
(e) . . . . . . . . . . . . . . . . . 1.1, 8.15
Section 315 (a) . . . . . . . . . . . . . . . . . 8.1(a), 8.3(a)
(b) . . . . . . . . . . . . . . . . . 8.2, 10.8
(c) . . . . . . . . . . . . . . . . . 8.1(a)
(d) . . . . . . . . . . . . . . . . . 8.1, 8.3
(e) . . . . . . . . . . . . . . . . . Not Applicable
Section 316 (a) . . . . . . . . . . . . . . . . . Not Applicable
(a)(1)(A) . . . . . . . . . . . . . . . . . Not Applicable
(a)(1)(B) . . . . . . . . . . . . . . . . . Not Applicable
(a)(2) . . . . . . . . . . . . . . . . . Not Applicable
(b) . . . . . . . . . . . . . . . . . Not Applicable
(c) . . . . . . . . . . . . . . . . . 6.7
Section 317 (a)(1) . . . . . . . . . . . . . . . . . Not Applicable
(b) . . . . . . . . . . . . . . . . . 5.9
Section 318 (a) . . . . . . . . . . . . . . . . . 10.10
</TABLE>
- --------------------
* Note: This reconciliation and tie sheet shall not, for any purpose, be
deemed to be a part of the Declaration.
iv
<PAGE>
AMENDED AND RESTATED DECLARATION OF TRUST, dated as of June 9,
1998, among: (i) Tower Automotive, Inc., a Delaware corporation (including
any successors or assigns, the "Depositor"); (ii) The First National Bank of
Chicago, a national banking association, as property trustee (in such
capacity, the "Property Trustee" and, in its personal capacity and not in its
capacity as Property Trustee, the "Bank"); (iii) First Chicago Delaware Inc.
a corporation duly organized and existing under the laws of the State of
Delaware, as Delaware trustee (in such capacity, the "Delaware Trustee");
(iv) Dugald K. Campbell, Anthony A. Barone and James R. Lozelle each of whose
address is c/o Tower Automotive, Inc., 6303 28th Street S.E., Grand Rapids,
Michigan 49546 (each, an "Administrative Trustee" and, collectively, the
"Administrative Trustees" and, collectively with the Property Trustee and
Delaware Trustee, the "Trustees") and (iv) the several Holders as hereinafter
defined.
W I T N E S S E T H:
WHEREAS, the Depositor and certain of the Trustees have
heretofore duly declared and created a business trust pursuant to the
Delaware Business Trust Act by (i) entering into that certain Trust
Agreement, dated as of June 3, 1998 (the "Original Declaration"), and (ii)
the execution and filing by certain of the Trustees with the Secretary of
State of the State of Delaware of the Certificate of Trust, filed on June 3,
1998, attached as EXHIBIT A, for the sole purpose of issuing and selling
certain securities representing undivided beneficial interests in the assets
of the Trust and investing the proceeds thereof in the Debentures (as defined
herein); and
WHEREAS, the parties hereto desire to amend and restate the
Original Declaration in its entirety as set forth herein to provide for,
among other things, (i) the issuance and sale of the Common Securities (as
defined herein) by the Trust to the Depositor, (ii) the issuance and sale of
the Preferred Securities by the Trust pursuant to the Purchase Agreement
(each as defined herein) and (iii) the acquisition by the Trust from the
Depositor of all of the right, title and interest in the Debentures;
NOW, THEREFORE, in consideration of the agreements and
obligations set forth herein and for other good and valuable consideration,
the sufficiency of which is hereby acknowledged, each party, for the benefit
of the other parties and for the benefit of the Holders of the Preferred
Securities, hereby amends and restates the Original Declaration in its
entirety and agrees as follows:
ARTICLE 1
DEFINED TERMS
SECTION 1.1. DEFINITIONS. For all purposes of this
Declaration, except as otherwise expressly provided or unless the context
otherwise requires:
(a) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as the
singular;
(b) all other terms used herein that are defined in the
Trust Indenture Act, either directly or by reference therein, have the
meanings assigned to them therein;
1
<PAGE>
(c) unless the context otherwise requires, any reference to
an "Article" or a "Section" refers to an Article or a Section, as the case
may be, of this Declaration; and
(d) the words "herein," "hereof" and "hereunder" and other
words of similar import refer to this Declaration as a whole and not to any
particular Article, Section or other subdivision.
"ACT" has the meaning specified in Section 6.4.
"ADDITIONAL AMOUNT" means, with respect to the Trust
Securities, the amount of Additional Interest (as defined in the Subordinated
Indenture) paid by the Depositor on the Debentures.
"ADDITIONAL SUMS" means, with respect to the Trust Securities,
the amount of Additional Sums (as defined in the Subordinated Indenture) paid
by the Depositor on the Debentures.
"ADMINISTRATIVE TRUSTEE" means each of Dugald K. Campbell,
Anthony A. Barone and James R. Lozelle, each solely in his capacity as
Administrative Trustee of the Trust and not in his individual capacity, or
such Administrative Trustee's successor in interest in such capacity, or any
successor in interest in such capacity, or any successor administrative
trustee appointed as herein provided.
"AFFILIATE" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or
indirect common control with such specified Person, provided, however that an
Affiliate of the Depositor shall be deemed not to include the Trust. For the
purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of
such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"APPLICABLE PROCEDURES" means, with respect to any transfer or
transaction involving a Global Certificate or beneficial interest therein,
the rules and procedures of Euroclear and Cedel, and of the Clearing Agency
for such security, in each case to the extent applicable to such transaction
and as in effect from time to time.
"BANK" has the meaning specified in the preamble to this
Declaration.
"BANKRUPTCY EVENT" means, with respect to any Person:
(a) the entry of a decree or order by a court having
jurisdiction in the premises judging such Person as bankrupt or
insolvent, or approving as properly filed a petition seeking
reorganization, arrangement, adjudication or composition of or in respect
of such Person under any applicable Federal or State bankruptcy,
insolvency, reorganization or other similar law, or appointing a
receiver, liquidator, assignee, trustee, sequestrator (or other similar
official) of such Person or of any substantial part of its property or
ordering the
2
<PAGE>
winding-up or liquidation of its affairs, and the continuance of any such
decree or order unstayed and in effect for a period of 60 consecutive
days; or
(b) the institution by such Person of proceedings to be
adjudicated as bankrupt or insolvent, or the consent by it to the
institution of bankruptcy or insolvency proceedings against it, or the
filing by it of a petition or answer or consent seeking reorganization or
relief under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law, or the consent by it to the filing
of any such petition or to the appointment of a receiver, liquidator,
assignee, trustee, sequestrator (or similar official) of such Person or
of any substantial part of its property, or the making by it of an
assignment for the benefit of creditors, or the admission by it in
writing of its inability to pay its debts generally as they become due
and its willingness to be adjudicated a bankrupt, or the taking of
corporate action by such Person in furtherance of any such action.
"BANKRUPTCY LAWS" has the meaning specified in Section 10.9.
"BOARD OF DIRECTORS" means either the board of directors of the
Depositor or any committee of that board duly authorized to act hereunder.
"BOOK-ENTRY PREFERRED SECURITIES CERTIFICATES" means a
beneficial interest in the Preferred Securities Certificates, ownership and
transfers of which shall be made through book entries by a Clearing Agency as
described in Section 5.11.
"BUSINESS DAY" means any day other than a Saturday or Sunday or
a day on which banking institutions in the City of New York are authorized or
required by law or executive order to remain closed or a day on which the
Corporate Trust Office of the Property Trustee or the corporate trust office
of the Subordinated Debt Trustee, is closed for business.
"CERTIFICATE DEPOSITORY AGREEMENT" means the agreement among
the Trust, the Depositor and The Depository Trust Company, as the initial
Clearing Agency, dated as of the Closing Date, relating to the Trust
Securities Certificates substantially in the form attached as EXHIBIT B, as
the same may be amended and supplemented from time to time.
"CERTIFICATED PREFERRED SECURITY" has the meaning specified in
Section 5.2.
"CLEARING AGENCY" means an organization registered as a
"clearing agency" pursuant to Section 17A of the Securities Exchange Act of
1934, as amended. The Depository Trust Company will be the initial Clearing
Agency.
"CLEARING AGENCY PARTICIPANT" means a broker, dealer, bank,
other financial institution or other Person for whom from time to time a
Clearing Agency effects book-entry transfers and pledges of securities
deposited with the Clearing Agency.
"CLOSING DATE" means the Closing Date (as defined in the
Purchase Agreement), which date is also the date of execution and delivery of
this Declaration.
3
<PAGE>
"COMMISSION" means the Securities and Exchange Commission, as
from time to time constituted, created under the Securities Exchange Act of
1934, as amended, or, if at any time after the execution of this instrument
such Commission is not existing and performing the duties now assigned to it
under the Trust Indenture Act, then the body performing such duties at such
time.
"COMMON SECURITIES CERTIFICATE" means a certificate evidencing
ownership of Common Securities, substantially in the form attached as EXHIBIT
C.
"COMMON SECURITIES GUARANTEE" means the Guarantee Agreement
executed and delivered by the Depositor contemporaneously with the execution
and delivery of this Declaration, for the benefit of the holders of the
Common Securities, as amended from time to time.
"COMMON SECURITY" means an undivided beneficial interest in the
assets of the Trust, having a Liquidation Amount with respect to the assets
of the Trust of $50 and having the rights provided therefor in this
Declaration, including the right to receive Distributions and a Liquidation
Distribution as provided herein.
"COMMON STOCK" means the Common Stock, par value $.01 per
share, of the Depositor.
"CONVERSION AGENT" has the meaning specified in Section 4.3.
"CONVERSION DATE" has the meaning specified in Section 4.3.
"CONVERSION EXPIRATION DATE" means the close of business on the
Business Day prior to the maturity date of the Debentures, or in the case of
the Preferred Securities called for redemption, the close of business on the
Business Day prior to the Redemption Date.
"CONVERSION PRICE" has the meaning specified in Section 4.3.
"CORPORATE TRUST OFFICE" means the principal corporate trust
office of the Property Trustee at which at any particular time its corporate
trust business shall be administered, which office at the date hereof is
located at The First National Bank of Chicago, Mail Suite 0129, Chicago,
Illinois 60670-0129.
"CURRENT MARKET PRICE," with respect to the Common Stock of the
Depositor, means the average of last reported sale price, regular way, for
the 10 Trading Days ending on the date of determination, or, if no sale takes
place on any such day, the average of the reported closing bid and asked
prices on such day(s), regular way, in either case as reported on NYSE, or,
if such Common Stock is not listed or admitted to trading on NYSE on any such
day, on the principal national securities exchange or quotation system on
which such Common Stock is listed or admitted to trading, or, if not listed
or admitted to trading or quoted on any national securities exchange or
quotation system, the average closing bid and asked prices of such Common
Stock in the over-the-counter market for the 10 Trading Days in question as
reported by the National Quotation Bureau Incorporated, or a similar
generally accepted reporting service, or, if not so available in such
4
<PAGE>
manner, as furnished by any member firm of the National Association of
Securities Dealers, Inc. selected from time to time by the Board of
Directors for that purpose or, if not so available in such manner, as
otherwise determined in good faith by the Board of Directors. As used
herein, the term "Trading Day" shall mean a day on which the principal
national securities exchange on which the Common Stock is listed or admitted
to trading is open for the transaction of business or, if the Common Stock is
not listed or admitted to trading on any national securities exchange, a
Business Day.
"DEBENTURE EVENT OF DEFAULT" means an "Event of Default" as
defined in the Subordinated Indenture.
"DEBENTURE REDEMPTION DATE" means, with respect to any
Debentures to be redeemed under the Subordinated Indenture, the date fixed
for redemption thereof under the Subordinated Indenture.
"DEBENTURES" means all of the Depositor's 6 3/4% junior
convertible subordinated debentures due June 30, 2018, $266,752,600 million
principal amount, issued pursuant to the Subordinated Indenture.
"DECLARATION" means this Amended and Restated Declaration of
Trust, as the same may be modified, amended or supplemented in accordance
with the applicable provisions hereof, including all exhibits hereto,
including, for all purposes of this Declaration any such modification,
amendment or supplement, the provisions of the Trust Indenture Act that are
deemed to be a part of and govern this Declaration and any such modification,
amendment or supplement, respectively.
"DEFINITIVE PREFERRED SECURITIES CERTIFICATES" means either or
both (as the context requires) of (a) Preferred Securities Certificates
issued in certificated, fully registered form as provided in Section 5.11(a)
and (b) Preferred Securities Certificates issued in certificated, fully
registered form as provided in Section 5.13.
"DELAWARE BUSINESS TRUST ACT" means Chapter 38 of Title 12 of
the Delaware Code, 12 Del. C. Section 3801, et. seq., as it may be amended
from time to time.
"DELAWARE TRUSTEE" means the Person identified as the "Delaware
Trustee" in the preamble to this Declaration solely in its capacity as
Delaware Trustee of the Trust and not in its individual capacity, or its
successor in interest in such capacity, or any successor Delaware trustee
appointed as herein provided.
"DEPOSITOR" has the meaning specified in the preamble to this
Declaration.
"DGCL" means the General Corporation Law of the State of
Delaware.
"DIRECT ACTION" has the meaning specified in Section 6.4.
"DISTRIBUTION DATE" has the meaning specified in Section 4.1(a).
"DISTRIBUTIONS" means amounts payable in respect of the Trust
Securities as provided in Section 4.1.
5
<PAGE>
"EARLY DISSOLUTION EVENT" has the meaning specified in Section
9.2.
"EVENT OF DEFAULT" means the occurrence of a Debenture Event of
Default, whatever the reason for such Debenture 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.
"EXCHANGE NOTICE" has the meaning specified in Section 4.4(b).
"EXPIRATION DATE" has the meaning specified in Section 9.1.
"GLOBAL CERTIFICATE" means a Preferred Security that is
registered in the Securities Register in the name of a Clearing Agency or a
nominee thereof.
"GUARANTEE" means the Guarantee Agreement executed and
delivered by the Depositor and The First National Bank of Chicago, a national
banking association, as guarantee trustee, contemporaneously with the
execution and delivery of this Declaration, for the benefit of the Holders of
the Preferred Securities, as amended from time to time.
"GUARANTEES" means the Guarantee and the Common Securities
Guarantee.
"HOLDER" means a Person in whose name a Trust Securities
Certificate representing a Trust Security is registered, such Person being a
beneficial owner within the meaning of the Delaware Business Trust Act.
"INVESTMENT COMPANY EVENT" means the receipt by the Property
Trustee, on behalf of the Trust, of an Opinion of Counsel, rendered by a law
firm having a recognized national tax and securities practice and experienced
in matters under the 1940 Act (which Opinion of Counsel shall not have been
rescinded by such law firm), to the effect that, as a result of the
occurrence of a change in law or regulation or a change in interpretation or
application of law or regulation by any legislative body, court, governmental
agency or regulatory authority (a "Change in 1940 Act Law"), there is more
than an insubstantial risk that the Trust is or will be within 90 days
considered an "investment company" that is required to be registered under
the 1940 Act, which Change in 1940 Act Law becomes effective on or after the
date of original issuance of the Preferred Securities under this Declaration.
"LIEN" means any lien, pledge, charge, encumbrance, mortgage,
deed of trust, adverse ownership interest, hypothecation, assignment,
security interest or preference, priority or other security agreement or
preferential arrangement of any kind or nature whatsoever.
"LIQUIDATED DAMAGES" has the meaning specified under the
Subordinated Indenture.
"LIQUIDATION AMOUNT" means an amount with respect to the assets
of the Trust equal to $50 per Trust Security.
6
<PAGE>
"LIQUIDATION DATE" means each date on which Debentures or cash
are to be distributed to Holders of Trust Securities in connection with a
dissolution and liquidation of the Trust pursuant to Section 9.4(a).
"LIQUIDATION DISTRIBUTION" has the meaning specified in Section
9.4(d).
"1940 ACT" means the Investment Company Act of 1940, as amended.
"NOTICE OF CONVERSION" means the notice given by a Holder of
Preferred Securities to the Conversion Agent directing the Conversion Agent
to exchange such Preferred Security for Debentures and to convert such
Debentures into Common Stock on behalf of such holder. Such notice is
substantially in the form set forth in EXHIBIT G.
"OFFICERS' CERTIFICATE" means a certificate signed by (i) the
Chairman of the Board, a Vice Chairman, the President or a Vice President,
and by (ii) the Treasurer, an Assistant Treasurer, the Controller, the
Secretary or an Assistant Secretary, of the Depositor, and delivered to the
Trustee. One of the officers signing an Officers' Certificate given pursuant
to Section 8.15 shall be the principal executive, financial or accounting
officer of the Depositor. Any Officers' Certificate delivered with respect
to compliance with a condition or covenant provided for in this Declaration
shall include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions
relating thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer in rendering the
Officers' Certificate;
(c) a statement that each officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such
officer to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
"OPINION OF COUNSEL" means a written opinion of counsel, who
may be counsel for the Trust, the Property Trustee or the Depositor, and who
may be an employee of any thereof, and who shall be acceptable to the
Property Trustee. Any Opinion of Counsel delivered with respect to compliance
with a condition or covenant provided for in this Declaration shall include:
(a) a statement that each individual signing the Opinion of
Counsel has read the covenant or condition and the definitions relating
thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by each individual in rendering
the Opinion of Counsel;
7
<PAGE>
(c) a statement that each individual has made such examination
or investigation as is necessary to enable such individual to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and
(d) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
"OPTIONAL REDEMPTION PRICE" means with respect to the Preferred
Securities (except as set forth below with respect to redemption upon the
occurrence of a Tax Event), the following percentages of the Liquidation
Amounts thereof, plus accumulated and unpaid Distributions, if any, to the
date fixed for redemption if redeemed during the twelve-month period
commencing June 30, in each of the following years indicated:
<TABLE>
<CAPTION>
Year Redemption Price Year Redemption Price
---- ---------------- ---- ----------------
<S> <C> <C> <C>
2001 104.725% 2005 102.025%
2002 104.050% 2006 101.350%
2003 103.375% 2007 100.675%
2004 102.700% 2008 100.000%
</TABLE>
In the event of a redemption of Trust Securities upon the
occurrence of a Tax Event, Trust Securities shall be redeemed at the
redemption price of $50 per Trust Security and all accumulated and unpaid
Distributions, if any, to the date fixed for redemption.
"ORIGINAL DECLARATION" has the meaning specified in the
recitals to this Declaration.
"OUTSTANDING," when used with respect to Trust Securities,
means, as of the date of determination, all Trust Securities theretofore
executed and delivered under this Declaration, except:
(a) Trust Securities theretofore canceled by the Securities
Registrar or delivered to the Securities Registrar for cancellation or
tendered for conversion;
(b) Trust Securities for whose payment or redemption money in
the necessary amount has been theretofore deposited with the Property
Trustee or any Paying Agent for the Holders of such Trust Securities;
provided that, if such Trust Securities are to be redeemed, notice of
such redemption has been duly given pursuant to this Declaration;
(c) Trust Securities which have been exchanged for Debentures
pursuant to Section 4.4; and
(d) Trust Securities which have been paid or in exchange for or
in lieu of which other Trust Securities have been executed and delivered
pursuant to Section 5.5;
PROVIDED, HOWEVER, that in determining whether the Holders of the requisite
Liquidation Amount of the Outstanding Trust Securities have given any
request, demand, authorization, direction, notice,
8
<PAGE>
consent or waiver hereunder, Trust Securities owned by the Depositor, any
Trustee or any Affiliate of the Depositor or any Trustee shall be disregarded
and deemed not to be Outstanding, except that (a) in determining whether any
Trustee shall be fully protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Trust Securities
that a Responsible Officer of the Property Trustee or the Delaware Trustee,
or an individual Administrative Trustee, as the case may be, actually knows
to be so owned shall be so disregarded and (b) the foregoing shall not apply
at any time when all of the Outstanding Trust Securities are owned by the
Depositor, one or more of the Trustees and/or any such Affiliate. Trust
Securities so owned which have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Securities
Registrar the pledgee's right so to act with respect to such Trust Securities
and that the pledgee is not the Depositor or any Affiliate of the Depositor.
"OWNER" means each Person who is the beneficial owner of a
Book-Entry Preferred Securities Certificate as reflected in the records of
the Clearing Agency or, if a Clearing Agency Participant is not the Owner,
then as reflected in the records of a Person maintaining an account with such
Clearing Agency (directly or indirectly, in accordance with the rules of such
Clearing Agency).
"PAYING AGENT" means any paying agent or co-paying agent
appointed pursuant to Section 5.9.
"PAYMENT ACCOUNT" means a segregated non-interest bearing
corporate trust account maintained by the Property Trustee with the Bank in
its trust department for the benefit of the Securityholders in which all
amounts paid in respect of the Debentures will be held and from which the
Property Trustee shall make payments to the Securityholders in accordance
with Section 4.1.
"PERSON" means any individual, corporation, partnership, joint
venture, trust, limited liability company or corporation, unincorporated
organization or government or any agency or political subdivision thereof.
"PREFERRED SECURITIES CERTIFICATE" means a certificate
evidencing ownership of Preferred Securities, substantially in the form
attached as EXHIBIT D.
"PREFERRED SECURITY" means an undivided beneficial interest in
the assets of the Trust, having a Liquidation Amount with respect to the
assets of the Trust of $50 and having the rights provided therefor in this
Declaration, including the right to receive Distributions and a Liquidation
Distribution as provided herein.
"PROPERTY TRUSTEE" means the commercial bank or trust company
identified as the "Property Trustee" in the preamble to this Declaration
solely in its capacity as Property Trustee of the Trust and not in its
individual capacity, or its successor in interest in such capacity, or any
successor property trustee appointed as herein provided.
"PURCHASE AGREEMENT" means the Purchase Agreement, dated as of
June 3, 1998, among the Trust, the Depositor and the Initial Purchasers named
therein.
"REDEMPTION DATE" means, with respect to any Trust Security to
be redeemed, each Debenture Redemption Date.
9
<PAGE>
"REDEMPTION PRICE" means, with respect to any Trust Security,
$50 per Trust Security, plus accumulated and unpaid Distributions (including
any Additional Sums) to the date of redemption.
"REGISTRATION RIGHTS AGREEMENT" means the Registration Rights
Agreement, dated as of June 9, 1998, among the Trust, the Depositor and the
Initial Purchasers named therein.
"RELEVANT TRUSTEE" has the meaning specified in Section 8.9.
"RESPONSIBLE OFFICER" means any officer assigned to the
Corporate Trust Office, including any managing director, vice president,
assistant vice president, assistant treasurer, assistant secretary or any
other officer of the Property Trustee or the Delaware Trustee customarily
performing functions similar to those performed by any of the above
designated officers and having direct responsibility for the administration
of this Declaration, and also, with respect to a particular matter, any other
officer, to whom such matter is referred because of such officer's knowledge
of and familiarity with the particular subject.
"RESTRICTED GLOBAL CERTIFICATE" has the meaning specified in
Section 5.2.
"RESTRICTED SECURITIES" means all Preferred Securities required
pursuant to Section 5.4 to bear any Restricted Securities Legend. Such term
includes the Restricted Global Certificate.
"RESTRICTED SECURITIES CERTIFICATE" means a certificate
substantially in the form set forth in Exhibit E.
"RESTRICTED SECURITIES LEGEND" has the meaning specified in
Section 5.15.
"RULE 144A PREFERRED SECURITIES" has the meaning specified in
Section 5.2.
"SECURITIES REGISTER" and "SECURITIES REGISTRAR" have the
respective meanings specified in Section 5.4.
"SECURITYHOLDER" or "HOLDER" means a Person in whose name a
Trust Security or Securities is registered in the Securities Register; any
such Person shall be deemed to be a beneficial owner within the meaning of
the Delaware Business Trust Act.
"SPECIAL EVENT" means a Tax Event or an Investment Company
Event.
"SUBORDINATED DEBT TRUSTEE" means The First National Bank of
Chicago, a national banking association, as trustee under the Subordinated
Indenture.
"SUBORDINATED INDENTURE" means the Junior Convertible
Subordinated Indenture, dated as of June 9, 1998 between the Depositor and
the Subordinated Debt Trustee, as amended or supplemented from time to time.
"SUCCESSOR PROPERTY TRUSTEE" has the meaning specified in
Section 8.9.
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"SUCCESSOR DELAWARE TRUSTEE" has the meaning specified in
Section 8.9.
"SUCCESSOR SECURITIES" has the meaning specified in Section 9.5.
"SUPER MAJORITY" has the meaning specified in Section 8.2.
"TAX ACTION" means any amendment to, or change (including any
announced prospective change) in, the laws (or any regulations thereunder) of
the United States or any political subdivision or taxing authority thereof or
therein affecting taxation, or as a result of any official administrative
pronouncement or judicial decision interpreting or applying such laws or
regulations, which amendment or change is effective or such pronouncement or
decision is announced on or after the date of the original issuance of the
Preferred Securities.
"TAX EVENT" means that the Company shall have requested and
received and shall have delivered to the Property Trustee an Opinion of
Counsel from a firm having a national tax and securities practice (which
Opinion of Counsel shall not have been rescinded by such law firm) that there
has been a Tax Action which relates to any of the items described in (i)
through (iii) below, and that there is more than an insubstantial risk that
(i) the Trust is or, within 90 days after such date, will be subject to
United States federal income tax with respect to income accrued or received
on the Debentures, (ii) the Trust is or, within 90 days after such date, will
be subject to more than a DE MINIMIS amount of other taxes, duties,
assessments or other governmental charges or (iii) interest payable by the
Depositor on the Debentures is not or, within 90 days after such date, will
not be deductible, in whole or in part, by the Depositor for United States
federal income tax purposes.
"TRUST" means the Delaware business trust continued hereby and
identified on the cover page of this Declaration.
"TRUST INDENTURE ACT" means the Trust Indenture Act of 1939 as
in force at the date as of which this instrument was executed; PROVIDED,
HOWEVER, that in the event the Trust Indenture Act of 1939 is amended after
such date, "Trust Indenture Act" means, to the extent required by any such
amendment, the Trust Indenture Act of 1939 as so amended.
"TRUST PROPERTY" means (a) the Debentures, (b) any cash on
deposit in, or owing to, the Payment Account and (c) all proceeds and rights
in respect of the foregoing to be held by the Property Trustee pursuant to
the terms of this Declaration for the benefit of the Securityholders.
"TRUST SECURITY" means any one of the Common Securities or the
Preferred Securities.
"TRUST SECURITIES CERTIFICATE" means any one of the Common
Securities Certificates, the Global Certificates or the Certificated
Preferred Securities.
"TRUSTEES" means, collectively, the Property Trustee, the
Delaware Trustee and the Administrative Trustees.
"UNRESTRICTED SECURITIES CERTIFICATE" means a certificate
substantially in the form set forth in EXHIBIT F.
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ARTICLE 2
ESTABLISHMENT OF THE TRUST
SECTION 2.1. NAME. The Trust continued hereby shall be
known as "Tower Automotive Capital Trust," as such name may be modified from
time to time by the Administrative Trustees following written notice to the
Holders of Trust Securities and the other Trustees, in which name the
Trustees may conduct the business of the Trust, make and execute contracts
and other instruments on behalf of the Trust and sue and be sued.
SECTION 2.2. OFFICE OF THE DELAWARE TRUSTEE; PRINCIPAL PLACE
OF BUSINESS. The address of the Delaware Trustee in the State of Delaware is
300 King Street, Wilmington, Delaware 19801, or such other address in the
State of Delaware as the Delaware Trustee may designate by written notice to
the Depositor. The principal executive office of the Trust is 4508 IDS
Center, Minneapolis, Minnesota 55402.
SECTION 2.3. ORGANIZATIONAL EXPENSES. The Depositor shall
pay organizational expenses of the Trust as they arise or shall, upon request
of any Trustee, promptly reimburse such Trustee for any such expenses paid by
such Trustee. The Depositor shall make no claim upon the Trust Property for
the payment of such expenses.
SECTION 2.4. ISSUANCE OF THE PREFERRED SECURITIES. On June
3, 1998, the Depositor and the Trust executed and delivered the Purchase
Agreement. Contemporaneously with the execution and delivery of this
Declaration, an Administrative Trustee, on behalf of the Trust, shall execute
in accordance with Section 5.2 and deliver to the Initial Purchasers named in
the Purchase Agreement, Preferred Securities Certificates, in an aggregate
amount of 5,175,000, representing Preferred Securities having an aggregate
Liquidation Amount of $258,750,000, against receipt of the aggregate
purchase price of such Preferred Securities of $258,750,000, which amount the
Administrative Trustees shall promptly deliver to the Property Trustee.
SECTION 2.5. SUBSCRIPTION AND PURCHASE OF DEBENTURES;
ISSUANCE OF THE COMMON SECURITIES. Contemporaneously with the execution and
delivery of this Declaration, an Administrative Trustee, on behalf of the
Trust, shall subscribe to and purchase from the Depositor, Debentures,
registered in the name of the Property Trustee (in its capacity as such) and
having an aggregate principal amount equal to $258,750,000, and, in
satisfaction of the purchase price for such Debentures, the Property Trustee,
on behalf of the Trust, shall deliver to the Depositor the sum of
$258,750,000. Contemporaneously therewith, an Administrative Trustee, on
behalf of the Trust, shall execute in accordance with Section 5.2 and deliver
to the Depositor, Common Securities Certificates registered in the name of
the Depositor, in an aggregate amount of 160,052, representing Common
Securities having an aggregate Liquidation Amount of $8,002,600 against
receipt of the aggregate purchase price of such Common Securities from the
Depositor of the sum of $8,002,600.
SECTION 2.6. DECLARATION OF TRUST. The exclusive purposes
and functions of the Trust are (a) to issue and sell Trust Securities and use
the proceeds from such sale to acquire the Debentures, (b) to distribute the
Trust's income as provided in this Declaration and (c) to engage in only
those other activities necessary or incidental thereto. The Trust shall not
borrow money, issue debt or reinvest proceeds derived from investments,
mortgage or pledge any of its assets or otherwise undertake (or permit to be
undertaken) any activity that would cause the Trust not to be
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classified for United States Federal income tax purposes as a grantor trust.
The Depositor hereby appoints the Trustees as trustees of the Trust, to have
all the rights, powers and duties to the extent set forth herein, and the
Trustees hereby accept such appointment. The Property Trustee hereby
declares that it will hold the Trust Property upon and subject to the
conditions set forth herein for the benefit of the Trust and the
Securityholders. The Administrative Trustees shall have all rights, powers
and duties set forth herein and in accordance with applicable law with
respect to accomplishing the purposes of the Trust. The Delaware Trustee
shall not be entitled to exercise any powers, nor shall the Delaware Trustee
have any of the duties and responsibilities, of the other Trustees set forth
herein. The Delaware Trustee shall be one of the Trustees of the Trust for
the sole and limited purpose of fulfilling the requirements of Section 3807
of the Delaware Business Trust Act.
SECTION 2.7. AUTHORIZATION TO ENTER INTO CERTAIN
TRANSACTIONS. (a) The Trustees shall conduct the affairs of the Trust in
accordance with the terms of this Declaration. Subject to the limitations
set forth in Section 2.6 and paragraph (b) of this Section, and in accordance
with the following provisions (i) and (ii), the Trustees shall have the
exclusive power, duty and the authority to cause the Trust to engage in the
following activities:
(i) As among the Trustees, each Administrative Trustee shall
have the power and authority to act on behalf of the Trust with respect
to the following matters:
(A) to issue and sell the Trust Securities; PROVIDED,
HOWEVER, that the Trust may issue no more than one series of
Preferred Securities and no more than one series of Common
Securities; PROVIDED, FURTHER, that there shall be no interests in
the Trust other than the Trust Securities, and the issuance of
Trust Securities shall be limited to simultaneous issuance of both
Preferred Securities and Common Securities on the Closing Date and
any other date Preferred Securities and Common Securities are sold
pursuant to the over-allotment option granted to the Initial
Purchasers named in the Purchase Agreement, subject to the
issuance of Trust Securities pursuant to Section 5.5 and Successor
Securities pursuant to Section 9.5;
(B) to cause the Trust to enter into, and to execute,
deliver and perform on behalf of the Trust, the Certificate
Depository Agreement and such other agreements as may be necessary
or incidental to the purposes and function of the Trust;
(C) to assist in the registration of the resale of the
Preferred Securities under the Securities Act of 1933, as amended,
and under state securities or blue sky laws, and the qualification
of this Declaration as a trust indenture under the Trust Indenture
Act;
(D) to assist in the listing of the Preferred
Securities upon such securities exchange or exchanges or Nasdaq,
if any, as shall be determined by the Depositor and the
registration of the Preferred Securities under the Securities
Exchange Act of 1934, as amended, and the preparation and filing
of all periodic and other reports and other documents pursuant to
the foregoing (only to the extent that such listing or
registration is requested by the Depositor);
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(E) to appoint a Paying Agent, a Securities Registrar
and an authenticating agent in accordance with this Declaration;
(F) to the extent provided in this Declaration, to
wind up the affairs of and liquidate the Trust and prepare,
execute and file the certificate of cancellation with the
Secretary of State of the State of Delaware;
(G) unless otherwise required by the Delaware Business
Trust Act or the Trust Indenture Act, to execute on behalf of the
Trust (either acting alone or together with any other
Administrative Trustees) any documents that the Administrative
Trustees have the power to execute pursuant to this Declaration;
and
(H) to take any action incidental to the foregoing as
the Trustees may from time to time determine is necessary or
advisable to give effect to the terms of this Declaration
including, but not limited to:
(i) causing the Trust not to be deemed to be an
Investment Company required to be registered under the 1940
Act;
(ii) causing the Trust to be classified for
United States Federal income tax purposes as a grantor
trust; and
(iii) cooperating with the Depositor to
ensure that the Debentures will be treated as indebtedness
of the Depositor for United States Federal income tax
purposes;
provided that such action does not adversely affect in any
material respect the interests of Securityholders except as
otherwise provided in Section 10.2(a).
(ii) As among the Trustees, the Property Trustee shall
have the power, duty and authority to act on behalf of the Trust with
respect to the following matters:
(A) the establishment of the Payment Account;
(B) the receipt of and taking title to the Debentures;
(C) the collection of interest, principal and any
other payments made in respect of the Debentures in the Payment
Account;
(D) the distribution from the Trust Property of
amounts owed to the Securityholders in respect of the Trust
Securities;
(E) the exercise of all of the rights, powers and
privileges of a holder of the Debentures;
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(F) the sending of notices of default, other notices
and other information regarding the Trust Securities and the
Debentures to the Securityholders in accordance with this
Declaration;
(G) the distribution of the Trust Property in
accordance with the terms of this Declaration;
(H) to the extent provided in this Declaration, the
winding up of the affairs of and liquidation of the Trust;
(I) after an Event of Default, the taking of any
action incidental to the foregoing as the Property Trustee may
from time to time determine is necessary or advisable to give
effect to the terms of this Declaration and protect and conserve
the Trust Property for the benefit of the Securityholders (without
consideration of the effect of any such action on any particular
Securityholder);
(J) subject to this Section 2.7(a)(ii), the Property
Trustee shall have none of the duties, liabilities, powers or the
authority of the Administrative Trustees set forth in Section
2.7(a)(i); and
(K) to act as Paying Agent and/or Securities Registrar
to the extent appointed as such hereunder.
(b) So long as this Declaration remains in effect, the Trust (or
the Trustees acting on behalf of the Trust) shall not undertake any business,
activities or transactions except as expressly provided herein or
contemplated hereby. In particular, the Trust shall not, and the Trustees
shall not, cause the Trust to (i) invest any proceeds received by the Trust
from holding the Debentures (rather, the Trustees shall distribute all such
proceeds to the Securityholders pursuant to the terms of this Declaration and
the Trust Securities), acquire any investments or engage in any activities
not authorized by this Declaration, (ii) sell, assign, transfer, exchange,
mortgage, pledge, set-off or otherwise dispose of any of the Trust Property
or interests therein, including to Securityholders, except as expressly
provided herein, (iii) take any action that would cause the Trust to fail or
cease to qualify as a "grantor trust" for United States Federal income tax
purposes, (iv) make any loans or incur any indebtedness for borrowed money or
issue any other debt, (v) take or consent to any action that would result in
the placement of a Lien on any of the Trust Property, (vi) possess any power
or otherwise act in such a way as to vary the Trust assets or the terms of
the Trust Securities in any way whatsoever except as permitted by the terms
of this Declaration, or (vii) issue any securities or other evidences of
beneficial ownership of, or beneficial interest in, the Trust other than the
Trust Securities. The Administrative Trustees shall defend all claims and
demands of all Persons at any time claiming any Lien on any of the Trust
Property adverse to the interest of the Trust or the Securityholders in their
capacity as Securityholders.
(c) In connection with the issue and sale of the Preferred
Securities, the Depositor shall have the right and responsibility to assist
the Trust with respect to, or effect on behalf of the Trust, the following
actions (and any actions taken by the Depositor in furtherance of the
following prior to the date of this Declaration are hereby ratified and
confirmed in all respects):
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(i) to prepare one or more offering memoranda in preliminary
and final form relating to the offering of the Preferred Securities of
the Trust in a transaction exempt from the registration requirements of
the Securities Act;
(ii) to determine the States and foreign jurisdictions in which
to take appropriate action to qualify or register for resale all or part
of the Preferred Securities and to do any and all such acts, other than
actions which must be taken by or on behalf of the Trust, and advise the
Trustees of actions they must take on behalf of the Trust, and prepare
for execution and filing any documents to be executed and filed by the
Trust or on behalf of the Trust, as the Depositor deems necessary or
advisable in order to comply with the applicable laws of any such States
and foreign jurisdictions;
(iii) to the extent necessary, to prepare for filing by the Trust
with the Commission and to execute on behalf of the Trust a registration
statement on Form 8-A relating to the registration of the Preferred
Securities under Section 12(b) or 12(g) of the Securities Exchange Act of
1934, as amended, including any amendments thereto (it being understood
that neither the Trust nor the Depositor has any obligation under the
Subordinated Indenture, the Purchase Agreement or the Declaration to
register any Trust Securities under the Securities Exchange Act of 1934,
as amended, or to list any Trust Securities on any securities exchange);
(iv) to negotiate, and to execute and deliver, on behalf of the
Trust, the Purchase Agreement and the Registration Rights Agreement; and
(v) any other actions necessary or incidental to carry out any
of the foregoing activities.
(d) Notwithstanding anything herein to the contrary, the
Administrative Trustees are authorized and directed to conduct the affairs of
the Trust and to operate the Trust so that the Trust will not be deemed to be
an "investment company" required to be registered under the 1940 Act, or
taxed as a corporation for United States Federal income tax purposes and so
that the Debentures will be treated as indebtedness of the Depositor for
United States Federal income tax purposes. In this connection, the Depositor
and the Administrative Trustees are authorized to take any action, not
inconsistent with applicable law, the Certificate of Trust or this
Declaration, that each of the Depositor and the Administrative Trustees
determines in their discretion to be necessary or desirable for such
purposes, so long as such action does not adversely affect in any material
respect the interests of the Holders of the Preferred Securities except as
otherwise provided in Section 10.2(a).
SECTION 2.8. ASSETS OF TRUST. The assets of the Trust shall
consist of only the Trust Property.
SECTION 2.9. TITLE TO TRUST PROPERTY. Legal title to all
Trust Property shall be vested at all times in the Property Trustee (in its
capacity as such) and shall be held and administered by the Property Trustee
for the benefit of the Trust and the Securityholders in accordance with this
Declaration. The Securityholders shall not have legal title to any part of
the assets of the Trust, but shall have an undivided beneficial interest in
the assets of the Trust.
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ARTICLE 3
PAYMENT ACCOUNT
SECTION 3.1. PAYMENT ACCOUNT. (a) On or prior to the
Closing Date, the Property Trustee shall establish the Payment Account. The
Property Trustee and any agent of the Property Trustee shall have exclusive
control and sole right of withdrawal with respect to the Payment Account for
the purpose of making deposits in and withdrawals from the Payment Account in
accordance with this Declaration. All monies and other property deposited or
held from time to time in the Payment Account shall be held by the Property
Trustee in the Payment Account for the exclusive benefit of the
Securityholders and for distribution as herein provided, including (and
subject to) any priority of payments provided for herein.
(b) The Property Trustee shall deposit in the Payment Account,
promptly upon receipt, all payments of principal of or interest on, and any
other payments or proceeds with respect to, the Debentures. Amounts held in
the Payment Account shall not be invested by the Property Trustee pending
distribution thereof.
ARTICLE 4
DISTRIBUTIONS; REDEMPTION; EXCHANGE; CONVERSION
SECTION 4.1. DISTRIBUTIONS. (a) Distributions on the Trust
Securities shall be cumulative, and shall accrue from the date of original
issuance, or the most recent Distribution Date (as defined herein) and,
except in the event that the Depositor exercises its right to defer the
payment of interest on the Debentures pursuant to the Subordinated Indenture,
shall be payable quarterly in arrears on March 31, June 30, September 30 and
December 31 of each year, commencing on September 30, 1998 (which dates
correspond to the interest payment dates on the Debentures), when, as and if
available for payment by the Property Trustee, as further described in
paragraph (c) of this Section 4.1. If any date on which Distributions are
otherwise payable on the Trust Securities is not a Business Day, then the
payment of such Distributions shall be made on the next succeeding day which
is a Business Day (and no interest shall accrue for the period from and after
such date until the next succeeding Business Day), except that if such
Business Day is in the next succeeding calendar year, such payment shall be
made on the immediately preceding Business Day, in each case with the same
force and effect as if made on such date (each date on which Distributions
are payable in accordance with this Section 4.1(a), a "Distribution Date").
(b) The Trust Securities represent undivided beneficial interests
in the Trust Property, and the Distributions on the Trust Securities shall be
payable at a rate of 6 3/4% per annum of the Liquidation Amount of the Trust
Securities, such rate being the rate of interest payable on the Debentures to
be held by the Property Trustee. The amount of Distributions payable for any
period shall be computed on the basis of a 360-day year of twelve 30-day
months. For periods less than a full month, Distributions shall reflect
interest on Debentures computed on the basis of the actual number of elapsed
days based on a 360-day year. The amount of Distributions payable for any
period shall include the Additional Amounts, if any.
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(c) Distributions on the Trust Securities shall be made by the
Property Trustee from the Payment Account and shall be payable on each
Distribution Date only to the extent that the Trust has funds then on hand
and available in the Payment Account for the payment of such Distributions.
(d) Distributions on the Trust Securities with respect to a
Distribution Date shall be payable to the Holders thereof as they appear on
the Securities Register for the Trust Securities on the relevant record date,
which shall be the date which is the fifteenth day (whether or not a Business
Day) next preceding such Distribution Date.
SECTION 4.2. REDEMPTION. (a) Upon an optional redemption
(as set forth in the Subordinated Indenture) of Debentures, the proceeds from
such redemption shall be applied to redeem Trust Securities having an
aggregate Liquidation Amount equal to the aggregate principal amount of the
Debentures so redeemed by the Depositor, including pursuant to Section 4.4,
at the Optional Redemption Price, and upon a mandatory redemption (as set
forth in the Subordinated Indenture) of Debentures, the proceeds from such
redemption shall be applied to redeem Trust Securities, having an aggregate
Liquidation Amount equal to the aggregate principal amount of the Debentures
so redeemed by the Depositor, at the Redemption Price. The Trust may not
redeem fewer than all the Outstanding Trust Securities unless all accrued and
unpaid Distributions have been paid on all Trust Securities for all quarterly
Distribution periods terminating on or prior to the date of redemption.
(b) Notice of redemption (which notice will be irrevocable) shall
be given by the Property Trustee by first-class mail, postage prepaid, mailed
not less than 30 nor more than 60 days prior to the Redemption Date to the
Depositor and each Holder of Trust Securities to be redeemed, at such
Holder's address as it appears in the Securities Register. All notices of
redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price or the Optional Redemption Price, as
the case may be;
(iii) the record date for the determination of Holders entitled
to receive payment of the Redemption Price or Optional Redemption Price,
as the case may be, as provided in Section 4.2(d);
(iv) the CUSIP number;
(v) if less than all of the Outstanding Trust Securities are to
be redeemed, the identification and the aggregate Liquidation Amount of
the particular Trust Securities to be redeemed;
(vi) the Conversion Price and that a Holder of Preferred
Securities who desires to convert such Preferred Securities called for
redemption must satisfy the requirements for conversion contained in
Section 4.3 below;
(vii) that on the Redemption Date the Redemption Price or the
Optional Redemption Price, as the case may be, will become due and
payable upon each such Trust
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Security to be redeemed and that Distributions thereon will cease to
accrue on and after said date; and
(viii) the place or places where such Trust Securities are to be
surrendered for payment of the Redemption Price or the Optional
Redemption Price, as the case may be.
(c) The Trust Securities redeemed on each Redemption Date shall be
redeemed at the Redemption Price or the Optional Redemption Price, as the
case may be, with the proceeds from the contemporaneous redemption of
Debentures. Redemptions of the Trust Securities shall be made and the
Redemption Price or the Optional Redemption Price, as the case may be, shall
be payable on each Redemption Date only to the extent that the Trust has
funds then on hand and available in the Payment Account for the payment of
such Redemption Price or the Optional Redemption Price, as the case may be.
(d) If the Property Trustee gives a notice of redemption in respect
of any Preferred Securities, then, by 12:00 noon, New York City time, on the
Redemption Date, subject to Section 4.2(c) and to the Property Trustee's
having received for deposit to the Property Account available funds
sufficient for such redemption by 10:00 a.m., New York City time, on the
Redemption Date, the Property Trustee will, so long as and to the extent the
Preferred Securities are in book-entry-only form, irrevocably deposit with
the Clearing Agency for the Preferred Securities funds sufficient to pay the
applicable Redemption Price or Optional Redemption Price, as the case may be,
and will give the Clearing Agency irrevocable instructions and authority to
pay the Redemption Price or Optional Redemption Price, as the case may be, to
the holders of the Preferred Securities. If the Preferred Securities are no
longer in book-entry-only form, the Property Trustee, subject to Section
4.2(c), will irrevocably deposit with the Paying Agent funds sufficient to
pay the applicable Redemption Price or Optional Redemption Price, as the case
may be, on such Preferred Securities held in certificated form and will give
the Paying Agent irrevocable instructions and authority to pay the Redemption
Price or the Optional Redemption Price, as the case may be, to the Holders
thereof upon surrender of their Preferred Securities Certificates.
Notwithstanding the foregoing, Distributions payable on or prior to the
Redemption Date for any Trust Securities called for redemption shall be
payable to the Holders of such Trust Securities as they appear on the
Securities Register for the Trust Securities on the relevant record dates
for the related Distribution Dates. If notice of redemption shall have been
given and funds deposited as required, then, upon the date of such deposit,
all rights of Securityholders holding Trust Securities so called for
redemption will cease, except (i) the right of such Securityholders to
receive the Redemption Price or the Optional Redemption Price, as the case
may be, but without interest, and (ii) the right to convert such Preferred
Securities into Common Stock in the manner provided in Section 4.3 through
the Conversion Expiration Date; and such Trust Securities will cease to be
Outstanding. In the event that any date on which any Redemption Price or the
Optional Redemption Price, as the case may be, is payable is not a Business
Day, then payment of the Redemption Price or the Optional Redemption Price,
as the case may be, payable on such date will be made on the next succeeding
day which is a Business Day (and without any interest or other payment in
respect of any such delay), except that, if such Business Day is in the next
succeeding calendar year, such payment shall be made on the immediately
preceding Business Day, in each case, with the same force and effect as if
made on such date. Payment of the Redemption Price or the Optional
Redemption Price, as the case may be, shall be made to the Holders of such
Trust Securities as they appear on the Securities Register for
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the Trust Securities on the relevant record date, which shall be the date
which is the fifteenth day (whether or not a Business Day) preceding such
Redemption Date.
(e) If less than all the Outstanding Trust Securities are to be
redeemed on a Redemption Date, then the aggregate Liquidation Amount of Trust
Securities to be redeemed shall be allocated on a PRO RATA basis (based on
Liquidation Amounts) among the Common Securities and the Preferred Securities
that are to be redeemed. The particular Preferred Securities to be redeemed
shall be selected not more than 60 days prior to the Redemption Date by the
Property Trustee from the Outstanding Preferred Securities not previously
called for redemption, by lot or by such other method as the Property Trustee
shall deem fair and appropriate and which may provide for the selection for
redemption of portions (equal to $50 or an integral multiple of $50 in excess
thereof) of the Liquidation Amount of the Preferred Securities. The Property
Trustee shall promptly notify the Securities Registrar and the Conversion
Agent in writing of the Preferred Securities selected for redemption and, in
the case of any Preferred Securities selected for partial redemption, the
Liquidation Amount thereof to be redeemed; it being understood that, in the
case of Preferred Securities registered in the name of and held of record by
the Clearing Agency (or any successor) or any nominee, the distribution of
the proceeds of such redemption will be made in accordance with the
procedures of the Clearing Agency or its nominee. For all purposes of this
Declaration, unless the context otherwise requires, all provisions relating
to the redemption of Preferred Securities shall relate, in the case of any
Preferred Securities redeemed or to be redeemed only in part, to the portion
of the Liquidation Amount of Preferred Securities which has been or is to be
redeemed. In the event of any redemption in part, the Trust shall not be
required to (i) issue, register the transfer of or exchange of any Preferred
Security during a period beginning at the opening of business 15 days before
any selection for redemption of Preferred Securities and ending at the close
of business on the earliest date in which the relevant notice of redemption
is deemed to have been given to all Holders of Preferred Securities to be so
redeemed or (ii) register the transfer of or exchange of any Preferred
Securities so selected for redemption, in whole or in part, except for the
unredeemed portion of any Preferred Securities being redeemed in part.
(f) In the event of any redemption, the Trust shall not be required
to issue, register the transfer of or register the exchange of any Preferred
Security during a period beginning at the opening of business 15 days before
any Redemption Date and ending at the close of business on such Redemption
Date.
SECTION 4.3. CONVERSION. The Holders of Trust Securities,
subject to the limitations set forth in this Section, shall have the right at
any time after 90 days of the Closing Date, at their option, to cause the
Conversion Agent to convert Trust Securities, on behalf of the converting
Holders, into shares of Common Stock in the manner described herein on and
subject to the following terms and conditions:
(i) The Trust Securities will be convertible into fully paid
and nonassessable shares of Common Stock pursuant to the Holder's
direction to the Conversion Agent to exchange such Trust Securities for a
portion of the Debentures having a principal amount equal to the
aggregate Liquidation Amount of such Trust Securities, and immediately
convert such amount of Debentures into fully paid and nonassessable
shares of Common Stock at an initial rate of 0.8140 shares of Common
Stock for each Trust Security (which is equivalent to a conversion price
of approximately $61.425 per $50 principal amount of
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Debentures), subject to certain adjustments set forth in the Subordinated
Indenture (as so adjusted, "Conversion Price").
(ii) In order to convert Trust Securities into Common Stock, the
Holder of such Trust Securities shall submit to the Conversion Agent an
irrevocable Notice of Conversion to convert Trust Securities on behalf of
such Holder, together, if the Trust Securities are in certificated form,
with such certificates. The Notice of Conversion shall (i) set forth the
number of Trust Securities to be converted and the name or names, if
other than the Holder, in which the shares of Common Stock should be
issued and (ii) direct the Conversion Agent (a) to exchange such Trust
Securities for a portion of the Debentures held by the Property Trustee
(at the rate of exchange specified in the preceding paragraph) and (b) to
immediately convert such Debentures, on behalf of such Holder, into
Common Stock (at the conversion rate specified in the preceding
paragraph). The Conversion Agent shall notify the Property Trustee in
writing of the Holder's election to exchange Trust Securities for a
portion of the Debentures held by the Property Trustee and the Property
Trustee shall, upon receipt of such written notice, deliver to the
Conversion Agent the appropriate principal amount of Debentures for
exchange in accordance with this Section. The Conversion Agent shall
thereupon notify the Depositor of the Holder's election to convert such
Debentures into shares of Common Stock. Holders of Trust Securities at
the close of business on a Distribution payment record date will be
entitled to receive the Distribution paid on such Trust Securities on the
corresponding Distribution Date notwithstanding the conversion of such
Trust Securities on or following such record date but prior to such
Distribution Date. Except as provided above, neither the Trust nor the
Depositor will make, or be required to make, any payment, allowance or
adjustment upon any conversion on account of any accumulated and unpaid
Distributions whether or not in arrears accrued on the Trust Securities
surrendered for conversion, or on account of any accumulated and unpaid
dividends on the shares of Common Stock issued upon such conversion.
Trust Securities submitted for conversion prior to the expiration of
conversion rights as provided in Section 4.3(iii) shall be deemed to have
been converted immediately prior to the close of business on the day on
which an irrevocable Notice of Conversion relating to such Trust
Securities is received by the Conversion Agent in accordance with the
foregoing provision (the "Conversion Date"). The Person or Persons
entitled to receive the Common Stock issuable upon conversion of the
Debentures shall be treated for all purposes as the record holder or
holders of such Common Stock on the date of conversion. As promptly as
practicable on or after the Conversion Date, the Depositor shall issue
and deliver at the office of the Conversion Agent a certificate or
certificates for the number of full shares of Common Stock issuable upon
such conversion, together with the cash payment, if any, in lieu of any
fraction of any share to the Person or Persons entitled to receive the
same, unless otherwise directed by the Holder in the notice of conversion
and the Conversion Agent shall distribute such certificate or
certificates to such Person or Persons.
(iii) The conversion rights of holders of the Debentures and the
corresponding conversion rights of Holders of Trust Securities shall
expire at the Conversion Expiration Date.
(iv) Each Holder of a Trust Security by its acceptance thereof
initially appoints The First National Bank of Chicago not in its
individual capacity but solely as conversion
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agent (the "Conversion Agent") for the purpose of effecting the
conversion of Trust Securities in accordance with this Section. In
effecting the conversion and transactions described in this Section,
the Conversion Agent shall be acting as agent of the Holders of Trust
Securities directing it to effect such conversion transactions. The
Conversion Agent is hereby authorized (i) to exchange Trust Securities
from time to time for Debentures held by the Trust in connection with
the conversion of such Trust Securities in accordance with this
Section and (ii) to convert all or a portion of the Debentures into
Common Stock and thereupon to deliver such shares of Common Stock in
accordance with the provisions of this Section and to deliver to the
Property Trustee any new Debenture or Debentures for any resulting
unconverted principal amount delivered to the Conversion Agent by the
Subordinated Debt Trustee.
(v) No fractional shares of Common Stock will be issued as a
result of conversion, but, in lieu thereof, such fractional interest will
be paid in cash by the Depositor to the Conversion Agent in an amount
equal to the Current Market Price of the fractional share of the Common
Stock, and the Conversion Agent will in turn make such payment to the
Holder or Holders of Trust Securities so converted.
(vi) Nothing in this Section 4.3 shall limit the requirement of
the Trust to withhold taxes pursuant to the terms of the Trust Securities
or as set forth in this Declaration or otherwise required of the Property
Trustee or the Trust to pay any amounts on account of such withholdings.
SECTION 4.4. SPECIAL EVENT EXCHANGE OR REDEMPTION. (a) If a
Special Event shall occur and be continuing, the Regular Trustees shall direct
the Conversion Agent to exchange all Outstanding Trust Securities for Debentures
having a principal amount equal to the aggregate Liquidation Amount of the Trust
Securities to be exchanged and with accrued interest in an amount equal to any
unpaid Distribution (including any Additional Amounts) on the Trust Securities;
PROVIDED, HOWEVER, that, in the case of a Tax Event, the Depositor shall have
the right to (i) direct that less than all, or none, as appropriate, of the
Trust Securities be so exchanged if and for so long as the Depositor shall have
elected to pay any Additional Sums (as defined in the Subordinated Indenture)
such that the amount received by Holders of Trust Securities not so exchanged in
respect of Distributions and other distributions are not reduced as a result of
such Tax Event, and shall not have revoked any such election or failed to make
such payments or (ii) cause the Trust Securities to be redeemed in the manner
set forth below. If a Tax Event shall occur or be continuing, the Depositor
shall have the right, upon not less than 30 nor more than 60 days' notice, to
redeem the Debentures, in whole or in part, for cash upon the later of (i) 90
days following the occurrence of such Tax Event or (ii) June 30, 2001. Promptly
following such redemption, Trust Securities with an aggregate Liquidation Amount
equal to the aggregate principal amount of the Debentures so redeemed will be
redeemed by the Trust at the Optional Redemption Price applicable in the event
of a redemption upon the occurrence of a Tax Event on a pro rata basis.
(b) Notice of any exchange pursuant to this Section 4.4 (an "Exchange
Notice") of the Trust Securities, which Exchange Notice shall be irrevocable,
will be given by the Property Trustee by first-class mail to the Depositor and
to each record Holder of Trust Securities to be exchanged not fewer than 30 nor
more than 60 days prior to the date fixed for exchange thereof. For purposes of
the calculation of the date of exchange and the dates on which notices are given
pursuant to this
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paragraph (b), an Exchange Notice shall be deemed to be given on the day such
notice is first mailed by first-class mail, postage prepaid, to each Holder.
Each Exchange Notice shall be addressed to each Holder of Trust Securities at
the address of such Holder appearing in the books and records of the Trust.
Each Exchange Notice shall state: (A) the exchange date; (B) the aggregate
Liquidation Amount and any unpaid Distributions (including any Additional
Amounts) on the Trust Securities to be exchanged and the aggregate principal
amount and any accrued interest on the Debentures to be exchanged therefor;
(C) that on the exchange date the Trust Securities to be so exchanged shall
be exchanged for Debentures and that Distributions on the Trust Securities so
exchanged will cease to accumulate on and after said date; (D) the record
date for the determination of Holders of Trust Securities to be exchanged as
provided in Section 4.4(g); and (E) the identity of the Conversion Agent, if
any, and the place or places where each Trust Certificate to be exchanged is
to be surrendered in exchange for Debentures. No defect in the Exchange
Notice or in the mailing thereof with respect to any Trust Security shall
affect the validity of the exchange proceedings for any other Trust Security.
(c) In the event that fewer than all the Outstanding Preferred
Securities are to be exchanged, then, on the exchange date, (i) if all of the
Outstanding Preferred Securities are represented by Definitive Preferred
Securities Certificates, the particular Preferred Securities to be exchanged
will be selected by the Property Trustee from the Outstanding Preferred
Securities not previously called for redemption or exchange on a pro rata
basis, (ii) if all of the Outstanding Preferred Securities are represented by
Book-Entry Preferred Securities Certificates, the Property Trustee shall
provide for the selection for exchange of a portion of the Global Certificate
representing the Book-Entry Preferred Securities Certificates on a pro rata
basis and (iii) if Outstanding Trust Securities are represented by both
Definitive Preferred Securities Certificates and Book-Entry Preferred
Securities Certificates, the Property Trustee shall select the portion of the
Global Certificate representing the Book-Entry Preferred Securities
Certificates and the particular Outstanding Preferred Securities represented
by Definitive Preferred Securities Certificates to be exchanged on a pro rata
basis. In the case of clause (ii) or (iii) above, the particular Book-Entry
Preferred Securities Certificates to be exchanged shall be selected in
accordance with the applicable rules and procedures for the Clearing Agency
in whose name, or whose nominee's name, such global certificate is then held.
Any Preferred Securities Certificate that is to be exchanged only in part
shall be surrendered with due endorsement or by a written instrument of
transfer fully executed by the Holder thereof (or its attorney duly
authorized in writing) and the Trust shall prepare and deliver to such
Holder, without service charge, a new Preferred Securities Certificate or
Certificates in aggregate stated Liquidation Amount equal to, and in exchange
for, the unredeemed portion of the Preferred Securities Certificate so
surrendered. The Common Securities shall be exchanged in a similar manner.
(d) In the event of an exchange pursuant to this Section 4.4, on
the date fixed for any such exchange, (i) if the Preferred Securities are
represented by Book-Entry Preferred Securities Certificates, the Clearing
Agency or its nominee, as the record Holder of the Preferred Securities, will
exchange through the Conversion Agent the Global Certificate representing the
Preferred Securities to be exchanged for a registered Global Certificate or
certificates representing the Debentures to be delivered upon such exchange,
(ii) if the Preferred Securities are represented by Definitive Preferred
Securities Certificates, the certificates representing the Preferred
Securities to be so exchanged will be deemed to represent Debentures having a
principal amount equal to the aggregate stated Liquidation Amount of such
Preferred Securities until such certificates are
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presented to the Conversion Agent for exchange for definitive certificates
representing Debentures and (iii) all rights of the Holders of the Preferred
Securities so exchanged will cease, except for the right of such Holders to
receive Debentures. The Common Securities shall be exchanged in a similar
manner.
(e) Each Holder, by becoming a party to this Declaration pursuant to
Section 10.11 of this Declaration, will be deemed to have agreed to be bound by
these exchange provisions in regard to the exchange of Trust Securities for
Debentures pursuant to the terms described above.
(f) Nothing in this Section 4.4 shall limit the requirement of the
Trust to withhold taxes pursuant to the terms of the Trust Securities or as set
forth in this Declaration or otherwise require the Property Trustee or the Trust
to pay any amounts on account of such withholdings.
(g) An exchange of Trust Securities for Debentures pursuant to this
Section 4.4 shall be made to Holders of Trust Securities as they appear on the
Securities Register for Trust Securities on the relevant record date, which
shall be the date which is the fifteenth day (whether or not a Business Day)
preceding the exchange date.
SECTION 4.5. SUBORDINATION OF COMMON SECURITIES. Payment of
Distributions (including Additional Amounts, if applicable) on, and the
Redemption Price of, the Trust Securities, as applicable, shall be made PRO RATA
based on the Liquidation Amount of the Trust Securities; PROVIDED, HOWEVER, that
if on any Distribution Date or Redemption Date an Event of Default or an event
of default under the Guarantee shall have occurred and be continuing, no payment
of any Distribution (including Additional Amounts, if applicable) on, or the
Redemption Price of, any Common Security, and no other payment on account of the
redemption, liquidation or other acquisition of Common Securities, shall be made
unless payment in full in cash of all accumulated and unpaid Distributions
(including Additional Amounts, if applicable) on all Outstanding Preferred
Securities for all Distribution periods terminating on or prior thereto, or in
the case of payment of the Redemption Price the full amount of such Redemption
Price on all Outstanding Preferred Securities, shall have been made or provided
for, and all funds immediately available to the Property Trustee shall first be
applied to the payment in full in cash of all Distributions (including
Additional Amounts, if applicable) on, or the Redemption Price of, Preferred
Securities then due and payable.
SECTION 4.6. PAYMENT PROCEDURES. Payments in respect of the
Preferred Securities shall be made by check mailed to the address of the Person
entitled thereto as such address shall appear on the Securities Register or, if
the Preferred Securities are held by a Clearing Agency, such Distributions shall
be made to the Clearing Agency in immediately available funds, in accordance
with the Certificate Depositary Agreement on the applicable Distribution Dates.
Payments in respect of the Common Securities shall be made in such manner as
shall be mutually agreed between the Property Trustee and the Holder of the
Common Securities.
SECTION 4.7. TAX RETURNS AND REPORTS. The Administrative
Trustees shall prepare (or cause to be prepared), at the Depositor's expense,
and file all United States Federal, State and local tax and information returns
and reports required to be filed by or in respect of the Trust. In this regard,
the Administrative Trustees shall (a) prepare and file (or cause to be prepared
or filed) Form 1041 or the appropriate Internal Revenue Service form required
to be filed in respect of the
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Trust in each taxable year of the Trust and (b) prepare and furnish (or cause
to be prepared and furnished) to each Securityholder a Form 1099 or the
appropriate Internal Revenue Service form required to be furnished to such
Securityholder or the information required to be provided on such form. The
Administrative Trustees shall provide the Depositor with a copy of all such
returns, reports and schedules promptly after such filing or furnishing. The
Trustees shall comply with United States Federal withholding and backup
withholding tax laws and information reporting requirements with respect to
any payments to Securityholders under the Trust Securities.
SECTION 4.8. PAYMENT OF TAXES, DUTIES, ETC. OF THE TRUST. Upon
receipt under the Debentures of Additional Sums, the Property Trustee, upon
receipt of written notice from the Depositor or the Administrative Trustees,
shall promptly pay from such Additional Sums any taxes, duties or governmental
charges of whatsoever nature (other than withholding taxes) imposed on the Trust
by the United States or any other taxing authority.
SECTION 4.9. PAYMENTS UNDER SUBORDINATED INDENTURE. Any amount
payable hereunder to any Holder of Preferred Securities shall be reduced by the
amount of any corresponding payment such Holder (or any Owner with respect
thereto) has directly received pursuant to Section 5.8 of the Subordinated
Indenture in accordance with the terms of Section 6.4 hereof.
ARTICLE 5
TRUST SECURITIES CERTIFICATES
SECTION 5.1. INITIAL OWNERSHIP. Upon the creation of the Trust
and until the issuance of the Trust Securities, and at any time during which no
Trust Securities are Outstanding, the Depositor shall be the sole beneficial
owner of the Trust.
SECTION 5.2. THE TRUST SECURITIES CERTIFICATES. The Preferred
Securities Certificates shall be issued in minimum denominations of $50
Liquidation Amount and integral multiples of $50 in excess thereof, and the
Common Securities Certificates shall be issued in denominations of $50
Liquidation Amount and integral multiples thereof. The consideration received
by the Trust for the issuance of the Trust Securities shall constitute a
contribution to the capital of the Trust and shall not constitute a loan to the
Trust. Preferred Securities initially sold to qualified institutional buyers in
reliance on Rule 144A under the Securities Act ("Rule 144A Preferred
Securities") initially will be represented by one or more certificates in
registered, global form (collectively, the "Restricted Global Certificate").
Preferred Securities initially transferred, in accordance with Section 5.4, in a
manner exempt from the registration requirements of the Securities Act will be
exchanged for Preferred Securities in registered, certificated form (the
"Certificated Preferred Securities"). The Trust Securities Certificates shall
be executed on behalf of the Trust by manual or facsimile signature of at least
one Administrative Trustee and authenticated by the Property Trustee. Trust
Securities Certificates bearing the manual or facsimile signatures of
individuals who were, at the time when such signatures shall have been affixed,
authorized to sign on behalf of the Trust, shall be validly issued and entitled
to the benefit of this Declaration, notwithstanding that such individuals or any
of them shall have ceased to be so authorized prior to the delivery of such
Trust Securities Certificates or did not hold such offices at the date of
delivery of such Trust Securities Certificates. A transferee of a Trust
Securities Certificate shall become a Securityholder, and shall be entitled to
the rights and subject to the obligations of a Securityholder
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hereunder, upon due registration of such Trust Securities Certificate in such
transferee's name pursuant to Section 5.4.
SECTION 5.3. DELIVERY OF TRUST SECURITIES CERTIFICATES. On the
Closing Date, the Administrative Trustees shall cause Trust Securities
Certificates, in an aggregate Liquidation Amount as provided in Sections 2.4 and
2.5, to be executed on behalf of the Trust and delivered to or upon the written
order of the Depositor, signed by its Chairman of the Board, any Vice Chairman,
its President, any Senior Vice President or any Vice President, Treasurer or
Assistant Treasurer or Controller without further corporate action by the
Depositor, in authorized denominations.
A Trust Security Certificate shall not be valid until
authenticated by the manual signature of an authorized signatory of the Property
Trustee. The signature shall be conclusive evidence that the Trust Security
Certificate has been authenticated under this Declaration. Upon a written order
of the Trust signed by one Administrative Trustee, the Property Trustee shall
authenticate the Trust Security Certificates for original issue.
The Property Trustee may appoint an authenticating agent
acceptable to the Administrative Trustees to authenticate Trust Security
Certificates. An authenticating agent may authenticate Trust Security
Certificates whenever the Property Trustee may do so. Each reference in this
Declaration to authentication by the Property Trustee includes authentication by
such agent. An authenticating agent has the same rights as the Property Trustee
to deal with the Depositor or an Affiliate with respect to the authentication of
Trust Securities.
SECTION 5.4. REGISTRATION OF TRANSFER AND EXCHANGE OF PREFERRED
SECURITIES. (a) The Securities Registrar shall keep or cause to be kept, at the
office or agency maintained pursuant to Section 5.8, a Securities Register in
which, subject to such reasonable regulations as it may prescribe, the
Securities Registrar shall provide for the registration of Preferred Securities
Certificates and Common Securities Certificates (subject to Section 5.10 in the
case of the Common Securities Certificates) and registration of transfers and
exchanges of Preferred Securities Certificates as herein provided. The Property
Trustee shall be the initial Securities Registrar.
Subject to the other provisions of this Declaration regarding
restrictions on transfer, upon surrender for registration of transfer of any
Preferred Security at an office or agency of the Securities Registrar designated
pursuant to Section 5.8 for such purpose, an Administrative Trustee shall
execute on behalf of the Trust by manual or facsimile signature, and the
Property Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Preferred Securities of any
authorized denominations and of a like aggregate principal amount and bearing
such restrictive legends as may be required by this Declaration.
At the option of the Holder, and subject to the other provisions
of this Section 5.4, Preferred Securities may be exchanged for other Preferred
Securities of any authorized denomination and of a like Liquidation Amount, upon
surrender of the Preferred Securities to be exchanged at any such office or
agency. Whenever any Preferred Securities are so surrendered for exchange, an
Administrative Trustee shall execute on behalf of the Trust by manual or
facsimile signature, and the Property Trustee shall authenticate and deliver,
the Preferred Securities which the Holder making the exchange is entitled to
receive.
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All Preferred Securities issued upon any registration of transfer
or exchange of Preferred Securities shall be entitled to the same benefits under
this Declaration, as the Securities surrendered upon such registration of
transfer or exchange.
Every Preferred Security presented or surrendered for registration
of transfer or for exchange shall (if so requested by the Depositor or the
Securities Registrar) be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to the Depositor and the Securities
Registrar duly executed, by the Holder thereof or his attorney duly authorized
in writing.
No service charge shall be made for any registration of transfer
or exchange of Preferred Securities Certificates, but the Securities Registrar
may require payment of a sum sufficient to cover any tax or governmental charge
that may be imposed in connection with any transfer or exchange of Preferred
Securities Certificates.
(b) CERTAIN TRANSFERS AND EXCHANGES. Notwithstanding any other
provision of this Declaration or the Preferred Securities, transfers and
exchanges of Preferred Securities and beneficial interests in a Global
Certificate of the kinds specified in this Section 5.4(b) shall be made only in
accordance with this Section 5.4(b).
(i) RESTRICTED NON-GLOBAL CERTIFICATE TO RESTRICTED GLOBAL
CERTIFICATE. If the Holder of a Restricted Security (other than a Global
Certificate) wishes at any time to transfer all or any portion of such
Restricted Security to a Person who wishes to take delivery thereof in
the form of a beneficial interest in the Restricted Global Certificate,
such transfer may be effected only in accordance with the provisions of
this Clause (b)(i) subject to the Applicable Procedures. Upon receipt by
the Property Trustee, as Securities Registrar, of (A) such Restricted
Security as provided in Section 5.4(a) and written instructions
satisfactory to the Property Trustee directing that a beneficial interest
in the Restricted Global Certificate in a specified Liquidation Amount
(or number of Preferred Securities) not greater than the amount of such
Preferred Security be credited to a specified participant's account and
(B) a Restricted Securities Certificate, if the specified account is to
be credited with a beneficial interest in the Restricted Global
Certificate satisfactory to the Property Trustee and duly executed by
such Holder or his attorney duly authorized in writing, then the Property
Trustee, as Securities Registrar, shall cancel such Restricted Security
(and issue a new Restricted Security in respect of any untransferred
portion thereof) as provided in Section 5.4(a) and increase the
Liquidation Amount of (or number of Preferred Securities represented by)
the Restricted Global Certificate by the specified Liquidation Amount (or
number of securities) as provided in Section 5.11(b).
(ii) NON-GLOBAL CERTIFICATE TO NON-GLOBAL CERTIFICATE. A
Security that is not a Global Certificate may be transferred, in whole or
in part, to a Person who takes delivery in the form of another Security
that is not a Global Certificate as provided in Section 5.11, provided
that, if the Security to be transferred in whole or in part is a
Restricted Security, then the Property Trustee shall have received a
Restricted Securities Certificate, satisfactory to the Property Trustee
and duly executed by the transferor Holder or his attorney duly
authorized in writing, in which case the transferee Holder shall take
delivery in the form of a Restricted Security (subject in every case to
Section 5.4(c)).
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(c) SECURITIES ACT LEGENDS. Rule 144A Securities, Certificated
Preferred Securities and their respective Successor Securities shall bear the
Restricted Securities Legend as set forth in Section 5.15, subject to the
following:
(i) subject to the following Clauses of this Section 5.4(c), a
Preferred Security or any portion thereof which is exchanged, upon
transfer or otherwise, for a Global Certificate or any portion thereof
shall bear the Restricted Securities Legend borne by such Global
Certificate while represented thereby;
(ii) subject to the following Clauses of this Section 5.4(c), a
new Preferred Security which is not a Global Certificate and is issued in
exchange for another Preferred Security (including, a Global Certificate)
or any portion thereof, upon transfer or otherwise, shall bear the
Restricted Securities Legend borne by such other Preferred Security;
(iii) Any Preferred Securities which are sold or otherwise
disposed of pursuant to an effective registration statement under the
Securities Act, together with their Successor Securities shall not bear
the Restricted Securities Legend; the Depositor shall inform the Property
Trustee in writing of the effective date of any such registration
statement registering the Preferred Securities under the Securities Act
and shall notify the Property Trustee at any time when prospectuses may
not be delivered with respect to Preferred Securities to be sold pursuant
to such registration statement. The Property Trustee shall not be liable
for any action taken or omitted to be taken by it in good faith in
accordance with the aforementioned registration statement;
(iv) at any time after the Preferred Securities may be freely
transferred without registration under the Securities Act or without
being subject to transfer restrictions pursuant to the Securities Act, a
new Preferred Security which does not bear the Restricted Securities
Legend may be issued in exchange for or in lieu of a Preferred Security
(other than a Global Certificate) or any portion thereof which bears such
a legend if the Property Trustee has received an Unrestricted Securities
Certificate, satisfactory to the Property Trustee and duly executed by
the Holder of such legended Preferred Security or his attorney duly
authorized in writing, and after such date and receipt of such
certificate, an Administrative Trustee shall execute on behalf of the
Trust by manual or facsimile signature, and the Property Trustee shall
authenticate and deliver such a new Preferred Security in exchange for or
in lieu of such other Preferred Security as provided in this Article 5;
(v) a new Preferred Security which does not bear the Restricted
Securities Legend may be issued in exchange for or in lieu of a Preferred
Security (other than a Global Certificate) or any portion thereof which
bears such a legend if, in the Depositor's judgment, placing such a
legend upon such new Preferred Security is not necessary to ensure
compliance with the registration requirements of the Securities Act, and
an Administrative Trustee shall execute on behalf of the Trust by manual
or facsimile signature, and the Property Trustee, at the written
direction of the Depositor, shall authenticate and deliver such a new
Preferred Security as provided in this Article 5; and
(vi) notwithstanding the foregoing provisions of this Section
5.4(c), a Successor Security of a Preferred Securities that does not bear
a particular form of the Restricted
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Securities Legend shall not bear such form of legend unless the
Depositor has reasonable cause to believe that such Successor Security
is a "restricted security" within the meaning of Rule 144, in which
case an Administrative Trustee shall execute on behalf of the Trust by
manual or facsimile signature, and the Property Trustee, at the
written direction of the Depositor, shall authenticate and deliver a
new Preferred Security bearing a Restricted Securities Legend in
exchange for such Successor Security as provided in this Article 5.
SECTION 5.5. MUTILATED, DESTROYED, LOST OR STOLEN TRUST
SECURITIES CERTIFICATES. If (a) any mutilated Trust Securities Certificate
shall be surrendered to the Securities Registrar, or if the Securities Registrar
shall receive evidence to its satisfaction of the destruction, loss or theft of
any Trust Securities Certificate and (b) there shall be delivered to the
Securities Registrar and the Administrative Trustees such security or indemnity
as may be required by them to save each of them harmless, then in the absence of
notice that such Trust Securities Certificate shall have been acquired by a
protected purchaser, the Administrative Trustees, or any one of them, on behalf
of the Trust shall execute and make available for authentication and delivery,
in exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Trust Securities Certificate, a new Trust Securities Certificate of like
denomination. In connection with the issuance of any new Trust Securities
Certificate under this Section, the Securities Registrar may require the payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection therewith. Any duplicative Trust Securities Certificate
issued pursuant to this Section shall constitute conclusive evidence of an
undivided beneficial interest in the assets of the Trust, as if originally
issued, whether or not the lost, stolen or destroyed Trust Securities
Certificate shall be found at any time.
SECTION 5.6. PERSONS DEEMED SECURITYHOLDERS. The Property
Trustee and the Securities Registrar shall treat the Person in whose name any
Trust Securities Certificate shall be registered in the Securities Register as
the owner of such Trust Securities Certificate for the purpose of receiving
Distributions and for all other purposes whatsoever, and neither the Property
Trustee nor the Securities Registrar shall be bound by any notice to the
contrary.
SECTION 5.7. ACCESS TO LIST OF SECURITYHOLDERS' NAMES AND
ADDRESSES. The Administrative Trustees or the Depositor shall furnish or cause
to be furnished (unless the Property Trustee is acting as Securities Registrar
with respect to the Trust Securities under the Declaration) a list, in such form
as the Property Trustee may reasonably require, of the names and addresses of
the Securityholders as of the most recent record date (a) to the Property
Trustee, quarterly at least 5 Business Days before each Distribution Date, and
(b) to the Property Trustee, promptly after receipt by the Depositor of a
written request therefor from the Property Trustee in order to enable the
Property Trustee to discharge its obligations under this Declaration, in each
case to the extent such information is in the possession or control of the
Administrative Trustees or the Depositor and is not identical to a previously
supplied list or has not otherwise been received by the Property Trustee in its
capacity as Securities Registrar. The rights of Securityholders to communicate
with other Securityholders with respect to their rights under this Declaration
or under the Trust Securities, and the corresponding rights of the Trustee shall
be as provided in the Trust Indenture Act, except to the extent Section 3819 of
the Delaware Business Trust Act would require greater access to such
information, in which case the latter shall apply. Each Holder, by receiving
and holding a Trust Securities Certificate, and each Owner shall be deemed to
have agreed not to hold the Depositor, the
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Property Trustee or the Administrative Trustees accountable by reason of the
disclosure of its name and address, regardless of the source from which such
information was derived.
SECTION 5.8. MAINTENANCE OF OFFICE OR AGENCY. The Securities
Registrar shall maintain in the City of Chicago an office or offices or agency
or agencies where Preferred Securities Certificates may be surrendered for
registration of transfer, exchange or conversion and where notices and demands
to or upon the Trustees in respect of the Trust Securities Certificates may be
served. The Securities Registrar initially designates The First National Bank
of Chicago, One First National Plaza, Suite 0126, Chicago, Illinois 60670-0126,
as its principal corporate trust office for such purposes. The Securities
Registrar shall give prompt written notice to the Depositor and to the
Securityholders of any change in the location of the Securities Register or any
such office or agency.
SECTION 5.9. APPOINTMENT OF PAYING AGENT. In the event that
the Preferred Securities are not in book-entry form only, the Trust shall
maintain in the City of New York, an office or agency (the "Paying Agent") where
the Preferred Securities may be presented for payment. The Paying Agent shall
make Distributions to Securityholders from the Payment Account and shall report
the amounts of such Distributions to the Property Trustee and the Administrative
Trustees. Any Paying Agent shall have the revocable power to withdraw funds
from the Payment Account for the purpose of making the Distributions referred to
above. The Administrative Trustees may revoke such power and remove the Paying
Agent if such Trustees determine in their sole discretion that the Paying Agent
shall have failed to perform its obligations under this Declaration in any
material respect. The Paying Agent shall initially be the Property Trustee, and
any co-paying agent chosen by the Property Trustee and acceptable to the
Administrative Trustees and the Depositor. Any Person acting as Paying Agent
shall be permitted to resign as Paying Agent upon 30 days' written notice to the
Property Trustee and the Depositor. In the event that the Property Trustee
shall no longer be the Paying Agent or a successor Paying Agent shall resign or
its authority to act be revoked, the Administrative Trustees shall appoint a
successor that is acceptable to the Property Trustee and the Depositor to act as
Paying Agent (which shall be a bank or trust company). Each successor Paying
Agent or any additional Paying Agent shall agree with the Trustees that, as
Paying Agent, such successor Paying Agent or additional Paying Agent will hold
all sums, if any, held by it for payment to the Securityholders in trust for the
benefit of the Securityholders entitled thereto until such sums shall be paid to
each Securityholder. The Paying Agent shall return all unclaimed funds to the
Property Trustee and upon removal of a Paying Agent such Paying Agent shall also
return all funds in its possession to the Property Trustee. The provisions of
Sections 8.1, 8.3 and 8.6 shall apply to the Property Trustee also in its role
as Paying Agent, for so long as the Property Trustee shall act as Paying Agent
and, to the extent applicable, to any other paying agent appointed hereunder.
Any reference in this Agreement to the Paying Agent shall include any co-paying
agent unless the context requires otherwise.
SECTION 5.10. OWNERSHIP OF COMMON SECURITIES BY DEPOSITOR. On
the date provided for in Section 2.5, the Depositor shall acquire beneficial and
record ownership of the Common Securities. The Depositor has covenanted in the
Subordinated Indenture to maintain directly or indirectly 100% ownership of the
Common Securities; provided that any permitted successor of the Company under
the Subordinated Indenture may succeed to the Company's ownership of the Common
Securities. To the fullest extent permitted by law, any attempted transfer of
the Common Securities in violation of that covenant shall be void. The
Administrative Trustees
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shall cause each Common Securities Certificate to contain a legend stating,
"THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT TO AN ENTITY WHOLLY OWNED BY
TOWER AUTOMOTIVE, INC. OR TO CERTAIN SUCCESSORS OF TOWER AUTOMOTIVE, INC."
SECTION 5.11. GLOBAL SECURITIES; NON-GLOBAL SECURITIES; COMMON
SECURITIES CERTIFICATE. (a) Each Global Certificate authenticated under this
Declaration shall be registered in the name of the Clearing Agency designated by
the Depositor for such Global Certificate or a nominee thereof and delivered to
such Clearing Agency or a nominee thereof or custodian therefor, and each such
Global Certificate shall constitute a Preferred Security for all purposes of
this Declaration.
(b) If a Global Certificate is to be exchanged for Certificated
Preferred Securities or canceled in whole, it shall be surrendered by or on
behalf of the Clearing Agency, its nominee or custodian to the Property Trustee,
as Securities Registrar, for exchange or cancellation as provided in this
Article 5. If any Global Certificate is to be exchanged for Certificated
Preferred Securities or canceled in part, or if another Preferred Security is to
be exchanged in whole or in part for a beneficial interest in any Global
Certificate, in each case, as provided in Section 5.4, then either (i) such
Global Certificate shall be so surrendered for exchange or cancellation as
provided in this Article 5 or (ii) the principal amount thereof (or number of
Preferred Securities represented thereby) shall be reduced or increased by an
amount equal to the portion thereof to be so exchanged or canceled, or equal to
the principal amount of (or number of securities represented by) such
Certificated Preferred Security to be so exchanged for a beneficial interest
therein, as the case may be, by means of an appropriate adjustment made on the
records of the Property Trustee, as Securities Registrar, whereupon the Property
Trustee, in accordance with the Applicable Procedures, shall instruct the
Clearing Agency or its authorized representative to make a corresponding
adjustment to its records. Upon any such surrender or adjustment of a Global
Certificate, an Administrative Trustee shall execute on behalf of the Trust by
manual or facsimile signature, and the Property Trustee shall, subject to
Section 5.4 and as otherwise provided in this Article 5, authenticate and
deliver any Preferred Securities issuable in exchange for such Global
Certificate (or any portion thereof) to or upon the written order of, and
registered in such names as may be directed by, the Clearing Agency or its
authorized representative. Upon the request of the Property Trustee in
connection with the occurrence of any of the events specified in the preceding
paragraph, the Depositor shall promptly make available to the Property Trustee a
reasonable supply of Preferred Securities that are not in the form of Global
Certificates. The Property Trustee shall be entitled to conclusively rely upon
any order, direction or request of the Clearing Agency or its authorized
representative which is given or made pursuant to this Article 5 if such order,
direction or request is given or made in accordance with the Applicable
Procedures.
(c) Every Preferred Security authenticated and delivered upon
registration of transfer of, or in exchange for or in lieu of, a Global
Certificate or any portion thereof, whether pursuant to this Article 5 or
otherwise, shall be authenticated and delivered in the form of, and shall be, a
Global Certificate, unless such Preferred Security is registered in the name of
a Person other than the Clearing Agency for such Global Certificate or a nominee
thereof.
(d) The Clearing Agency or its nominee, as registered owner of a
Global Certificate, shall be the holder of such Global Certificate for all
purposes under this Declaration and the Preferred Securities, and owners of
beneficial interests in a Global Certificate shall hold such interests
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pursuant to the Applicable Procedures. Accordingly, any such Owner's
beneficial interest in a Global Certificate will be shown only on, and the
transfer of such interest shall be effected only through, records maintained
by the Clearing Agency or its nominee or its participants and such owners of
beneficial interests in a Global Certificate will not be considered the
owners or holders of such Global Certificate for any purpose of this
Declaration or the Preferred Securities.
(e) A single Common Securities Certificate representing the Common
Securities shall initially be issued to the Depositor in the form of a
definitive Common Securities Certificate.
SECTION 5.12. NOTICES TO CLEARING AGENCY. To the extent that a
notice or other communication to the Holders is required under this Declaration,
unless and until Definitive Preferred Securities Certificates shall have been
issued to Holders pursuant to Section 5.13, the Trustees shall give all such
notices and communications specified herein to be given to Holders to the
Clearing Agency, and shall have no obligations to provide notices directly to
the Holders.
SECTION 5.13. DEFINITIVE PREFERRED SECURITIES CERTIFICATES.
Notwithstanding any other provision in this Declaration, no Global Certificate
may be exchanged in whole or in part for Preferred Securities registered, and no
transfer of a Global Certificate in whole or in part may be registered, in the
name of any Person other than the Clearing Agency for such Global Certificate or
a nominee thereof unless (i) such Clearing Agency (A) has notified the Trust and
the Depositor that it is unwilling or unable to continue as Clearing Agency for
such Global Certificate or (B) has ceased to be a clearing agency registered as
such under the Securities Exchange Act of 1934, as amended, and in either case
the Trust and the Depositor thereupon fail to appoint a successor Clearing
Agency, (ii) the Trust, at its option, notifies the Property Trustee in writing
that it elects to cause the issuance of the Preferred Securities in certificated
form or (iii) there shall have occurred and be continuing an Event of Default or
any event which after notice or lapse of time or both would be an Event of
Default. In all cases, Certificated Preferred Securities delivered in exchange
for any Global Certificate or beneficial interests therein will be registered in
the names, and issued in any approved denominations, requested by or on behalf
of the Clearing Agency (in accordance with its customary procedures).
SECTION 5.14. RIGHTS OF SECURITYHOLDERS. The legal title to the
Trust Property is vested exclusively in the Property Trustee (in its capacity as
such) in accordance with Section 2.9, and the Securityholders shall not have any
right or title therein other than the undivided beneficial interest in the
assets of the Trust conferred by their Trust Securities and they shall have no
right to call for any partition or division of property, profits or rights of
the Trust except as described below. The Trust Securities shall be personal
property giving only the rights specifically set forth therein and in this
Declaration. The Trust Securities shall have no preemptive or similar rights
and, when issued and delivered to Securityholders against payment of the
purchase price therefor, will be fully paid and nonassessable undivided
beneficial interests in the assets of the Trust. The Holders of the Trust
Securities, in their capacities as such, shall be entitled to the same
limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware.
SECTION 5.15. RESTRICTIVE LEGEND. The Restricted Global
Certificate and the Certificated Preferred Securities shall bear the following
legend (the "Restricted Securities Legend") unless the Depositor determines
otherwise in accordance with applicable law:
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THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY HAS NOT
BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED,
SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR
TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET
FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE
HOLDER (1) REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL BUYER"
(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT), (2) AGREES
THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THE SECURITY
EVIDENCED HEREBY OR THE COMMON STOCK, IF ANY, ISSUABLE UPON
CONVERSION OR EXCHANGE OF SUCH SECURITY EXCEPT (A) TO TOWER
AUTOMOTIVE, INC. OR A SUBSIDIARY THEREOF, (B) TO A PERSON WHOM THE
SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER
PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A UNDER THE SECURITIES ACT, OR (C) PURSUANT TO THE
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE
SECURITIES ACT (IF AVAILABLE) AND (3) AGREES THAT IT WILL DELIVER
TO EACH PERSON TO WHOM THE SECURITY EVIDENCED HEREBY IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
IN CONNECTION WITH ANY TRANSFER OF THE SECURITY EVIDENCED HEREBY
PRIOR TO THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES
OF THE SECURITY EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE
SECURITIES ACT (OR ANY SUCCESSOR PROVISION), THE HOLDER MUST CHECK
THE APPROPRIATE BOX SET FORTH ON THE REVERSE HEREOF RELATING TO
THE MANNER OF SUCH TRANSFER AND SUBMIT THIS CERTIFICATE TO THE
TRUSTEE FOR THE PREFERRED SECURITIES OR THE DEBENTURES, AS THE
CASE MAY BE (OR, IF THIS CERTIFICATE EVIDENCES COMMON STOCK, SUCH
HOLDER MUST FURNISH TO THE TRANSFER AGENT), TOGETHER WITH SUCH
CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS TOWER
AUTOMOTIVE, INC., THE TRUSTEE OR THE TRANSFER AGENT, AS
APPLICABLE, MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER
IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION
NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT. THIS LEGEND WILL BE REMOVED AFTER THE EXPIRATION OF THE
HOLDING PERIOD APPLICABLE TO SALES OF THE SECURITY EVIDENCED
HEREBY UNDER RULE 144(k) UNDER THE SECURITIES ACT.
ARTICLE 6
ACT OF SECURITYHOLDERS; MEETINGS; VOTING
SECTION 6.1. LIMITATIONS ON VOTING RIGHTS. (a) Except as
provided in this Section, in Section 8.2 and 10.2 and in the Subordinated
Indenture and as otherwise required by law,
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no Holder of Preferred Securities shall have any right to vote or in any
manner otherwise control the administration, operation and management of the
Trust or the obligations of the parties hereto, nor shall anything herein set
forth, or contained in the terms of the Trust Securities Certificates, be
construed so as to constitute the Securityholders from time to time as
partners or members of an association.
(b) Subject to the requirement of the Property Trustee obtaining an
Opinion of Counsel in certain circumstances set forth in Section 6.1(d) below,
the Holders of a Majority in Liquidation Amount of the Preferred Securities have
the right to direct the time, method and place of conducting any proceeding for
any remedy available to the Property Trustee, or direct the exercise of any
trust or power conferred upon the Property Trustee under the Declaration,
including the right to direct the Property Trustee, as Holder of the Debentures,
to (i) exercise the remedies available to it under the Subordinated Indenture as
a Holder of the Debentures or (ii) consent to any amendment, modification, or
termination of the Subordinated Indenture or the Debentures where such consent
shall be required; provided, however, that where a consent or action under the
Subordinated Indenture would require the consent or act of the Holders of more
than a majority of the outstanding principal amount of the Debentures affected
thereby, only the Holders of the percentage of the aggregate stated Liquidation
Amount of the Preferred Securities which is at least equal to such required
percentage of the principal amount of Debentures may direct the Property Trustee
to give such consent or take such action; PROVIDED FURTHER, HOWEVER, that
(subject to the provisions of Section 8.1) the Property Trustee shall have the
right to decline to follow any such direction if the Property Trustee, being
advised by counsel, determines that the action or proceeding so directed may not
lawfully be taken or if the Property Trustee, in good faith, by its board of
directors or trustees, executive committee, or a trust committee of directors or
trustees, and/or Responsible Officers, shall determine that the action or
proceeding so directed would involve the Property Trustee in personal liability.
(c) If the Property Trustee fails to enforce its rights under the
Subordinated Indenture after a Holder of Preferred Securities has made a written
request, such Holder of Preferred Securities may institute a legal proceeding
directly against the Company, to enforce the Property Trustee's rights under the
Subordinated Indenture without first instituting any legal proceeding against
the Property Trustee or any other person or entity. Notwithstanding the
foregoing, if an Event of Default has occurred and is continuing and such event
is attributable to the failure of the Company to make any required payment when
due on the Debentures, then a Holder of Preferred Securities may directly
institute a proceeding against the Company for enforcement such payment.
(d) The Property Trustee shall notify all Holders of the Preferred
Securities of any notice of any Event of Default received from the Company with
respect to the Debentures. Except with respect to directing the time, method,
and place of conducting a proceeding for a remedy, the Property Trustee shall be
under no obligation to take any of the actions described in Section 6.1(b)(i)
and (ii) above unless the Property Trustee has obtained an Opinion of Counsel
(which counsel shall be independent tax counsel) to the effect that as a result
of such action, the Trust will not be taxable as a corporation for United States
federal income tax purposes and that after such action each Holder will continue
to be treated as owning an undivided beneficial ownership interest in the
Debentures.
(e) In the event the consent of the Property Trustee, as the Holder of
the Debentures, is required under the Subordinated Indenture with respect to any
amendment, modification or
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termination of the Subordinated Indenture, the Property Trustee shall request
the direction of the Holders of the Trust Securities with respect to such
amendment, modification or termination and shall vote with respect to such
amendment, modification or termination as directed by a Majority in
Liquidation Amount of the Trust Securities voting together as a single class;
PROVIDED, HOWEVER, that where a consent under the Subordinated Indenture
would require the consent of the Holders of more than a majority of the
aggregate principal amount of the Debentures, the Property Trustee may only
give such consent at the direction of the Holders of at least the same
proportion in aggregate stated Liquidation Amount of the Trust Securities.
The Property Trustee shall not take any such action in accordance with the
directions of the Holders of the Trust Securities unless the Property Trustee
has obtained an Opinion of Counsel to the effect that, as a result of such
action, the Trust will not be classified as other than a grantor trust for
United States federal income tax purposes.
(f) Any required approval or direction of Holders of Preferred
Securities may be given at a separate meeting of Holders of Preferred Securities
convened for such purpose, at a meeting of all the Holders of Trust Securities
or pursuant to written consent. In accordance with Section 6.3, the
Administrative Trustees will cause a notice of any meeting at which Holders of
Preferred Securities are entitled to vote, or of any matter upon which action by
written consent of such Holders is to be taken, to be mailed to each Holder of
Preferred Securities. Each such notice will include a statement setting forth
the following information: (i) the date of such meeting or the date by which
such action is to be taken; (ii) a description of any resolution proposed for
adoption at such meeting on which such Holders are entitled to vote or of such
matter upon which written consent is sought; and (iii) instructions for the
delivery of proxies or consents.
(g) No vote or consent of the Holders of Preferred Securities will be
required for the Trust to redeem and cancel Preferred Securities or distribute
Debentures in accordance with the Declaration.
(h) Notwithstanding that Holders of Preferred Securities are entitled
to vote or consent under any of the circumstances described above, any of the
Preferred Securities that are beneficially owned at such time by the Company or
any entity directly or indirectly controlled by, or under direct or indirect
common control with, the Company, shall not be entitled to vote or consent and
shall, for purposes of such vote or consent, be treated as if such Preferred
Securities were not outstanding, except for Preferred Securities purchased or
acquired by the Company or its Affiliates in connection with transactions
effected by or for the account of customers of the Company or any of its
subsidiaries or in connection with the distribution or trading of such Preferred
Securities; PROVIDED, HOWEVER, that persons (other than Affiliates of the
Company) to whom the Company or any of its subsidiaries have pledged Preferred
Securities may vote or consent with respect to such pledged Preferred Securities
pursuant to the terms of such pledge.
(i) Holders of the Preferred Securities will have no rights to appoint
or remove the Administrative Trustees, who may be appointed, removed or replaced
solely by the Company, as the Holder of all the Common Securities.
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SECTION 6.2. VOTING RIGHTS OF COMMON SECURITIES.
(a) Except as provided under this Section 6.2 or as otherwise required
by the Delaware Business Trust Act, the Trust Indenture Act or other applicable
law or provided by the Declaration, the Holders of the Common Securities will
have no voting rights.
(b) The Holders of the Common Securities are entitled, in accordance
with Article 8 of this Declaration, to vote to appoint, remove or replace any
Trustee or to increase or decrease the number of Trustees.
(c) Subject to Section 8.2 of the Declaration and only after all
Events of Default with respect to the Preferred Securities have been cured,
waived, or otherwise eliminated and subject to the requirement of the Property
Trustee obtaining an Opinion of Counsel in certain circumstances set forth in
this paragraph (c), the Holders of a Majority in Liquidation Amount of the
Common Securities have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Property Trustee, or
direct the exercise of any trust or power conferred upon the Property Trustee
under the Declaration, including the right to direct the Property Trustee, as
Holder of the Debentures, to exercise the remedies available to it under the
Subordinated Indenture as a Holder of the Debentures; PROVIDED, HOWEVER, that
(subject to the provisions of Section 8.1) the Property Trustee shall have the
right to decline to follow any such direction if the Property Trustee, being
advised by counsel, determines that the action or proceeding so directed may not
lawfully be taken or if the Property Trustee, in good faith, by its board of
directors or trustees, executive committee, or a trust committee of directors or
trustees, and/or Responsible Officers, shall determine that the action or
proceeding so directed would involve the Property Trustee in personal liability.
Except with respect to directing the time, method and place of conducting a
proceeding for a remedy, the Property Trustee shall be under no obligation to
take any of the actions described above in this Section 6.2(c) unless the
Property Trustee has obtained an Opinion of Counsel (which counsel shall be
independent tax counsel) to the effect that, as a result of such action, for
United States federal income tax purposes the Trust will not be taxable as a
corporation for United States federal income tax purposes and each Holder will
be treated as owning an undivided beneficial ownership interest in the
Debentures and Guarantees.
(d) If the Property Trustee fails to enforce its rights under the
Debentures after a Holder of Common Securities has made a written request, such
Holder of Common Securities may institute a legal proceeding directly against
the Company to enforce the Property Trustee's rights under the Debentures
without first instituting any legal proceeding against the Property Trustee or
any other person or entity.
(e) Any required approval or direction of Holders of Common Securities
may be given at a separate meeting of Holders of Common Securities convened for
such purpose, at a meeting of all the Holders of Trust Securities or pursuant to
written consent. In accordance with Section 6.3, the Administrative Trustees
will cause a notice of any meeting at which Holders of Common Securities are
entitled to vote, or of any matter upon which action by written consent of such
Holders is to be taken, to be mailed to each Holder of record of Common
Securities. Each such notice will include a statement setting forth the
following information: (i) the date of such meeting or the date by which such
action is to be taken; (ii) a description of any resolution proposed for
adoption at such
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meeting on which such Holders are entitled to vote or of such matter upon
which written consent is sought; and (iii) instructions for the delivery of
proxies or consents.
(f) No vote or consent of the Holders of the Common Securities shall
be required for the Trust to redeem and cancel Common Securities or to
distribute Debentures in accordance with the Declaration and the terms of the
Trust Securities.
SECTION 6.3. MEETINGS OF THE HOLDERS OF TRUST SECURITIES;
ACTION BY WRITTEN CONSENT.
(a) Meetings of the Holders of any class of Trust Securities may be
called at any time by the Administrative Trustees (or as otherwise provided in
this Declaration) to consider and act on any matter on which Holders of such
class of Trust Securities are entitled to act under the terms of this
Declaration, the Guarantees, the rules of any stock exchange on which the
Preferred Securities are listed or admitted for trading, the Business Trust Act
or other applicable law. The Administrative Trustees shall call a meeting of
the Holders of such class if directed to do so by the Holders of at least 10% in
Liquidation Amount of such class of Trust Securities. Such direction shall be
given by delivering to the Administrative Trustees one or more notices in a
writing stating that the signing Holders of Trust Securities wish to call a
meeting and indicating the general or specific purpose for which the meeting is
to be called. Any Holders of Trust Securities calling a meeting shall specify
in writing the Certificates held by the Holders of Trust Securities exercising
the right to call a meeting and only those Trust Securities specified shall be
counted for purposes of determining whether the required percentage set forth in
the second sentence of this paragraph has been met.
(b) Except to the extent otherwise provided in the terms of the Trust
Securities, the following provisions shall apply to meetings of Holders of Trust
Securities:
(i) notice of any such meeting shall be given to all the
Holders of Trust Securities having a right to vote thereat at least seven
days and not more than 60 days before the date of such meeting. Any
action that may be taken at a meeting of the Holders of Trust Securities
may be taken without a meeting if a consent in writing setting forth the
action so taken is signed by the Holders of Trust Securities owning not
less than the minimum amount in Liquidation Amount of Trust Securities
that would be necessary to authorize or take such action at a meeting at
which all Holders of Trust Securities having a right to vote thereon were
present and voting. Prompt notice of the taking of action without a
meeting shall be given to the Holders of Trust Securities entitled to
vote who have not consented in writing. The Administrative Trustees may
specify that any written ballot submitted to the Holder for the purpose
of taking any action without a meeting shall be returned to the Trust
within the time specified by the Administrative Trustees;
(ii) each Holder of a Trust Security may authorize any Person to
act for it by proxy on all matters in which a Holder of Trust Securities
is entitled to participate, including waiving notice of any meeting, or
voting or participating at a meeting. No proxy shall be valid after the
expiration of 11 months from the date thereof unless otherwise provided
in the proxy. Every proxy shall be revocable at the pleasure of the
Holder of Trust Securities executing it. Except as otherwise provided
herein, all matters relating to the giving, voting
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or validity of proxies shall be governed by the DGCL relating to
proxies, and judicial interpretations thereunder, as if the Trust were
a Delaware corporation and the Holders of the Trust Securities were
shareholders of a Delaware corporation;
(iii) each meeting of the Holders of the Trust Securities shall
be conducted by the Administrative Trustees or by such other Person that
the Administrative Trustees may designate; and
(iv) unless the Delaware Business Trust Act, this Declaration,
the Trust Indenture Act, the Guarantees or the listing rules of any
stock exchange on which the Preferred Securities are then listed for
trading otherwise provides, the Administrative Trustees, in their sole
discretion, shall establish all other provisions relating to meetings of
Holders of Trust Securities, including notice of the time, place or
purpose of any meeting at which any matter is to be voted on by any
Holders of Trust Securities, waiver of any such notice, action by consent
without a meeting, the establishment of a record date, quorum
requirements, voting in person or by proxy or any other matter with
respect to the exercise of any such right to vote.
SECTION 6.4. ACTS OF SECURITYHOLDERS. Any request, demand,
authorization, direction, notice, consent, waiver or other action provided or
permitted by this Declaration to be given, made or taken by Securityholders or
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Securityholders or Holders in person
or by an agent duly appointed in writing; and, except as otherwise expressly
provided herein, such action shall become effective when such instrument or
instruments are delivered to an Administrative Trustee. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Securityholders or 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
Declaration and (subject to Section 8.1) conclusive in favor of the Trustees, if
made in the manner provided in this Section.
The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where
such execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which any Trustee receiving the same deems sufficient.
The ownership of Preferred Securities shall be proved by the
Securities Register.
Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Securityholder of any Trust Security shall bind every
future Securityholder of the same Trust Security and the Securityholder of every
Trust 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 Trustees or the Trust in reliance thereon, whether or not
notation of such action is made upon such Trust Security.
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Without limiting the foregoing, a Securityholder entitled
hereunder to take any action hereunder with regard to any particular Trust
Security may do so with regard to all or any part of the Liquidation Amount of
such Trust 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
Liquidation Amount.
If any dispute shall arise between the Securityholders and the
Administrative Trustees or among such Securityholders or Trustees with respect
to the authenticity, validity or binding nature of any request, demand,
authorization, direction, consent, waiver or other Act of such Securityholder or
Trustee under this Article 6, then the determination of such matter by the
Property Trustee shall be conclusive with respect to such matter.
Upon the occurrence and continuation of an Event of Default, the
Holders of Preferred Securities shall rely on the enforcement by the Property
Trustee of its rights as holder of the Debentures against the Depositor. If the
Property Trustee fails to enforce its rights as holder of the Debentures after a
request therefor by a Holder of Preferred Securities, such holder may, to the
extent permitted by applicable law, proceed to enforce such rights directly
against the Depositor. Notwithstanding the foregoing, if an Event of Default
has occurred and is continuing and such event is attributable to the failure of
the Depositor to pay interest or principal on the Debentures on the date such
interest or principal is otherwise payable (or in the case of redemption, on the
Redemption Date), then a Holder of Preferred Securities shall have the right to
institute a proceeding directly against the Depositor, for enforcement of
payment to such holder of the principal amount of or interest on Debentures
having a principal amount equal to the aggregate Liquidation Amount of the
Preferred Securities of such holder after the respective due date specified in
the Debentures (a "Direct Action"). In connection with any such Direct Action,
the rights of the Depositor will be subrogated to the rights of any Holder of
the Preferred Securities to the extent of any payment made by the Depositor to
such Holder of Preferred Securities as a result of such Direct Action.
SECTION 6.5. INSPECTION OF RECORDS. Upon reasonable notice to
the Administrative Trustees and the Property Trustee, the records of the Trust
shall be open to inspection by Securityholders during normal business hours for
any purpose reasonably related to such Securityholder's interest as a
Securityholder.
ARTICLE 7
REPRESENTATIONS AND WARRANTIES
SECTION 7.1. REPRESENTATIONS AND WARRANTIES OF THE PROPERTY
TRUSTEE AND THE DELAWARE TRUSTEE. The Property Trustee and the Delaware
Trustee, each severally on behalf of and as to itself, hereby represents and
warrants for the benefit of the Depositor and the Securityholders that (each
such representation and warranty made by the Property Trustee and the Delaware
Trustee being made only with respect to itself):
(a) the Property Trustee is a national banking association duly
organized, validly existing and in good standing under the laws of the United
States;
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(b) the Delaware Trustee is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware;
(c) each of the Property Trustee and the Delaware Trustee has full
corporate and trust power, authority and legal right to execute, deliver and
perform its obligations under this Declaration and has taken all necessary
action to authorize the execution, delivery and performance by it of this
Declaration;
(d) this Declaration has been duly authorized, executed and delivered
by each of the Property Trustee and the Delaware Trustee and constitutes the
valid and legally binding agreement of the Property Trustee and the Delaware
Trustee enforceable against it in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors' rights
and to general equity principles; and
(e) the execution, delivery and performance by each of the Property
Trustee and the Delaware Trustee of this Declaration have been duly authorized
by all necessary corporate or other action on the part of the Property Trustee
and the Delaware Trustee and do not require any approval of stockholders of the
Property Trustee or the Delaware Trustee and such execution, delivery and
performance will not (i) violate either of the Property Trustee's or the
Delaware Trustee's charter or by-laws or (ii) violate any law, governmental rule
or regulation of the United States or the State of Delaware, as the case may be,
governing the banking, corporate, or trust powers of the Property Trustee or the
Delaware Trustee (as appropriate in context) or any order, judgment or decree
applicable to the Property Trustee or the Delaware Trustee.
SECTION 7.2. REPRESENTATIONS AND WARRANTIES OF DEPOSITOR. The
Depositor hereby represents and warrants for the benefit of the Securityholders
that:
(a) the Trust Securities Certificates issued on the Closing Date on
behalf of the Trust have been duly authorized and will have been duly and
validly executed, issued and delivered by the Trustees pursuant to the terms and
provisions of, and in accordance with the requirements of, this Declaration and
the Securityholders will be, as of such date, entitled to the benefits of this
Declaration; and
(b) there are no taxes, fees or other governmental charges payable by
the Trust (or the Trustees on behalf of the Trust) under the laws of the States
of Delaware or Illinois or any political subdivision thereof in connection with
the execution, delivery and performance by the Property Trustee or the Delaware
Trustee, as the case may be, of this Declaration.
ARTICLE 8
THE TRUSTEES
SECTION 8.1. CERTAIN DUTIES AND RESPONSIBILITIES. (a) The
duties and responsibilities of the Trustees shall be as provided by this
Declaration and, in the case of the Property Trustee, by the Trust Indenture
Act. The Property Trustee, before the occurrence of any Event of Default and
after the curing or waiving of all Events of Default that may have occurred,
shall undertake to perform only such duties and obligations as are
specifically set forth in this
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Declaration and the Trust Indenture Act and no implied covenants shall be
read into this Declaration against the Property Trustee. In case an Event of
Default has occurred (that has not been cured or waived pursuant to Section
8.2) of which a Responsible Officer of the Property Trustee has actual
knowledge, the Property Trustee shall exercise such rights and powers vested
in it by this Declaration and the Trust Indenture Act, and use the same
degree of care and skill in its exercise, as a prudent individual would
exercise or use under the circumstances in the conduct of his or her own
affairs. Notwithstanding the foregoing, no provision of this Declaration
shall require the Trustees to expend or risk their own funds or otherwise
incur any financial liability in the performance of any of their duties
hereunder, or in the exercise of any of their rights or powers, if they shall
have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured
to it. Whether or not therein expressly so provided, every provision of this
Declaration relating to the conduct or affecting the liability of or
affording protection to the Trustees shall be subject to the provisions of
this Section. Nothing in this Declaration shall be construed to release the
Administrative Trustees or Delaware Trustee from liability for their own
grossly negligent action, their own grossly negligent failure to act, or
their own willful misconduct. To the extent that, at law or in equity, an
Administrative Trustee or Delaware Trustee has duties (including fiduciary
duties) and liabilities relating thereto to the Trust or to the
Securityholders, such Administrative Trustee or Delaware Trustee shall not be
liable to the Trust or to any Securityholder for such Administrative
Trustee's good faith reliance on the provisions of this Declaration. The
provisions of this Declaration, to the extent that they restrict the duties
and liabilities of the Administrative Trustees or Delaware Trustee otherwise
existing at law or in equity, are agreed by the Depositor and the
Securityholders to replace such other duties and liabilities of the
Administrative Trustees or Delaware Trustee.
(b) All payments made by the Property Trustee or a Paying Agent in
respect of the Trust Securities shall be made only from the revenue and proceeds
from the Trust Property and only to the extent that there shall be sufficient
revenue or proceeds from the Trust Property to enable the Property Trustee or a
Paying Agent to make payments in accordance with the terms hereof. Each
Securityholder, by its acceptance of a Trust Security, agrees that it will look
solely to the revenue and proceeds from the Trust Property to the extent legally
available for distribution to it as herein provided and that the Trustees are
not personally liable to it for any amount distributable in respect of any Trust
Security or for any other liability in respect of any Trust Security. This
Section 8.1(b) does not limit the liability of the Trustees expressly set forth
elsewhere in this Declaration or, in the case of the Property Trustee, in the
Trust Indenture Act.
(c) No provision of this Declaration shall be construed to relieve the
Property Trustee from liability for its own negligent action, its own negligent
failure to act, or its own willful misconduct, except that:
(i) the Property Trustee shall not be liable for any error of
judgment made in good faith by an authorized officer of the Property
Trustee, unless it shall be proved that the Property Trustee was
negligent in ascertaining the pertinent facts;
(ii) the Property Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in accordance
with the direction of the Holders of a majority in aggregate Liquidation
Amount of the Trust Securities relating to the time, method and place of
conducting any proceeding for any remedy available to the Property
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Trustee, or exercising any trust or power conferred upon the Property
Trustee under this Declaration;
(iii) the Property Trustee's sole duty with respect to the
custody, safekeeping and physical preservation of the Debentures and the
Payment Account shall be to deal with such property as fiduciary assets,
subject to the protections and limitations on liability afforded to the
Property Trustee under this Declaration and the Trust Indenture Act;
(iv) the Property Trustee shall not be liable for any interest
on any money received by it except as it may otherwise agree with the
Depositor and money held by the Property Trustee need not be segregated
from other funds held by it except in relation to the Payment Account
maintained by the Property Trustee pursuant to Section 3.1 and except to
the extent otherwise required by law;
(v) the Property Trustee shall not be responsible for
monitoring the compliance by the Administrative Trustees or the Depositor
with their respective duties under this Declaration, nor shall the
Property Trustee be liable for the default or misconduct of the
Administrative Trustees or the Depositor; and
(vi) the Property Trustee shall have no duty or liability with
respect to the value, genuineness, existence or sufficiency of the
Debentures or the payment of any taxes or assessments thereon or in
connection therewith.
SECTION 8.2. NOTICE OF DEFAULTS. (a) Within ninety (90) days
after the occurrence of any Event of Default actually known to a Responsible
Officer of the Property Trustee, the Property Trustee shall transmit, in the
manner and to the extent provided in Section 10.8, notice of such Event of
Default to the Holders of Preferred Securities, the Administrative Trustees and
the Depositor, unless such Event of Default shall have been cured or waived;
provided that, except for a default in the payment of principal of (or premium,
if any) or interest on any of the Debentures, the Property Trustee shall be
fully protected in withholding such notice if and so long as the Board of
Directors, the executive committee, or a trust committee of directors and/or
responsible officers of the Property Trustee in good faith determines that the
withholding of such notice is in the interests of the Holders of the Preferred
Securities.
(b) Within ten days after the receipt of notice of the Depositor's
exercise of its right to extend the interest payment period for the Debentures
pursuant to the Subordinated Indenture, the Property Trustee shall transmit, in
the manner and to the extent provided in Section 10.8, notice of such exercise
to the Securityholders, unless such exercise shall have been revoked.
(c) The Holders of a majority in Liquidation Amount of Preferred
Securities may, by vote, on behalf of the Holders of all of the Preferred
Securities, waive any past Event of Default in respect of the Preferred
Securities and its consequences; provided that, if the underlying Debenture
Event of Default:
(i) is not waivable under the Subordinated Indenture, the Event
of Default under this Declaration shall also not be waivable; or
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(ii) requires the consent or vote of greater than a majority in
principal amount of the holders of the Debentures, including the consent
or vote of all such holders, (a "Super Majority") to be waived under the
Subordinated Indenture, the Event of Default under this Declaration may
only be waived by the vote of the Holders of the same proportion in
Liquidation Amount of the Preferred Securities that the relevant Super
Majority represents of the aggregate principal amount of the Debentures
outstanding.
The provisions of Section 6.1(b) and this Section 8.2(c) shall be
in lieu of Section 316(a)(1)(B) of the Trust Indenture Act and such Section
316(a)(1)(B) of the Trust Indenture Act is hereby expressly excluded from this
Declaration and the Preferred Securities, as permitted by the Trust Indenture
Act. Upon such waiver, any such default shall cease to exist, and any Event of
Default with respect to the Preferred Securities arising therefrom shall be
deemed to have been cured, for every purpose of this Declaration, but no such
waiver shall extend to any subsequent or other default or an Event of Default
with respect to the Preferred Securities or impair any right consequent thereon.
Any waiver by the Holders of the Preferred Securities of an Event of Default
with respect to the Preferred Securities shall also be deemed to constitute a
waiver by the Holders of the Common Securities of any such Event of Default with
respect to the Common Securities for all purposes of this Declaration without
any further act, vote, or consent of the Holders of the Common Securities.
(d) The Holders of a majority in Liquidation Amount of the Common
Securities may, by vote, on behalf of the Holders of all of the Common
Securities, waive any past Event of Default with respect to the Common
Securities and its consequences; provided that, if the underlying Debenture
Event of Default:
(i) is not waivable under the Subordinated Indenture, except
where the Holders of the Common Securities are deemed to have waived such
Event of Default under the Declaration as provided below in this Section
8.2(d), the Event of Default under this Declaration shall also not be
waivable; or
(ii) requires the consent or vote of a Super Majority to be
waived, except where the Holders of the Common Securities are deemed to
have waived such Event of Default under this Declaration as provided
below in this Section 8.2(d), the Event of Default under this Declaration
may only be waived by the vote of the Holders of the same proportion in
Liquidation Amount of the Common Securities that the relevant Super
Majority represents of the aggregate principal amount of the Debentures
outstanding;
provided further, that each Holder of Common Securities will be deemed to have
waived any such Event of Default and all Events of Default with respect to the
Common Securities and its consequences until all Events of Default with respect
to the Preferred Securities have been cured, waived or otherwise eliminated, and
until such Events of Default have been so cured, waived or otherwise eliminated,
the Property Trustee will be deemed to be acting solely on behalf of the Holders
of the Preferred Securities and only the Holders of the Preferred Securities
will have the right to direct the Property Trustee in accordance with the terms
of the Securities. The provisions of Section 6.1(b) and this Section 8.2(d)
shall be in lieu of Section 316(a)(1)(B) of the Trust Indenture Act and such
Section 316(a)(1)(B) of the Trust Indenture Act is hereby expressly excluded
from this Declaration and the Preferred Securities, as permitted by the Trust
Indenture Act. Subject to the
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foregoing provisions of this Section 8.2(d), upon such waiver, any such
default shall cease to exist and any Event of Default with respect to the
Common Securities arising therefrom shall be deemed to have been cured for
every purpose of this Declaration, but no such waiver shall extend to any
subsequent or other default or Event of Default with respect to the Common
Securities or impair any right consequent thereon.
(e) A waiver of an Event of Default under the Subordinated Indenture
by the Property Trustee at the direction of the Holders of the Preferred
Securities, constitutes a waiver of the corresponding Event of Default under
this Declaration. The foregoing provisions of this Section 8.2(e) shall be in
lieu of Section 316(a)(1)(B) of the Trust Indenture Act and such Section
316(a)(1)(B) of the Trust Indenture Act is hereby expressly excluded from this
Declaration and the Preferred Securities, as permitted by the Trust Indenture
Act.
SECTION 8.3. CERTAIN RIGHTS OF PROPERTY TRUSTEE. Subject to
the provisions of Section 8.1:
(a) the Property Trustee may conclusively rely and shall be fully
protected in acting or refraining from acting in good faith upon any resolution,
Opinion of Counsel, certificate, written representation of a Holder or
transferee such as of a certificate presented for transfer, certificate of
auditors or any other certificate, statement, instrument, opinion, report,
notice, request, consent, order, appraisal, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties;
(b) if no Event of Default has occurred and is continuing and, (i) in
performing its duties under this Declaration the Property Trustee is required to
decide between alternative courses of action or (ii) in construing any of the
provisions in this Declaration the Property Trustee finds the same ambiguous or
inconsistent with any other provisions contained herein or (iii) the Property
Trustee is unsure of the application of any provision of this Declaration, then,
except as to any matter as to which the Holders of Preferred Securities are
entitled to vote under the terms of this Declaration, the Property Trustee shall
deliver a notice to the Depositor requesting written instructions of the
Depositor as to the course of action to be taken and the Property Trustee shall
take such action, or refrain from taking such action, as the Property Trustee
shall be instructed in writing to take, or to refrain from taking, by the
Depositor; PROVIDED, HOWEVER, that if the Property Trustee does not receive such
instructions of the Depositor within ten Business Days after it has delivered
such notice, or such reasonably shorter period of time set forth in such notice
(which to the extent practicable shall not be less than two Business Days), it
may, but shall be under no duty to, take or refrain from taking such action not
inconsistent with this Declaration as it shall deem advisable and in the best
interests of the Securityholders, in which event the Property Trustee shall have
no liability except for its own bad faith, negligence or willful misconduct;
(c) any direction or act of the Depositor or the Administrative
Trustees contemplated by this Declaration shall be sufficiently evidenced by an
Officers' Certificate;
(d) whenever in the administration of this Declaration, the Property
Trustee shall deem it desirable that a matter be established before undertaking,
suffering or omitting any action hereunder, the Property Trustee (unless other
evidence is herein specifically prescribed) may, in the absence of bad faith on
its part, request and conclusively rely upon an Officers' Certificate and an
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Opinion of Counsel which, upon receipt of such request, shall be promptly
delivered by the Depositor or the Administrative Trustees;
(e) the Property Trustee shall have no duty to accomplish any
recording, filing or registration of any instrument (including any financing or
continuation statement or any filing under tax or securities laws) or any
rerecording, refiling or reregistration thereof;
(f) the Property Trustee may consult with counsel at the Depositor's
expense (which counsel may be counsel to the Depositor or any of its Affiliates,
and may include any of its employees) and the advice of such counsel or any
Opinion of Counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good faith
and in reliance thereon and in accordance with such advice; and the Property
Trustee shall have the right at any time to seek instructions concerning the
administration of this Declaration from any court of competent jurisdiction;
(g) the Property Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Declaration at the request or
direction of any of the Securityholders pursuant to this Declaration, unless
such Securityholders shall have offered to the Property Trustee reasonable
security or indemnity satisfactory to it against the costs, expenses (including
attorneys' fees and expenses and the expenses of the Property Trustee's agents,
custodians or nominees) and liabilities which might be incurred by it in
compliance with such request or direction;
(h) the Property Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolutions, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval, bond,
debenture, note or other evidence of indebtedness or other paper or document,
but the Property Trustee may make such further inquiry or investigation into
such facts or custodian or nominee matters as it may see fit;
(i) the Property Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through its
agents, custodians or nominees, attorneys or an Affiliate; provided that the
Property Trustee shall not be responsible for the negligence or recklessness on
the part of any agent, attorney, custodian or nominee appointed by it with due
care hereunder;
(j) whenever in the administration of this Declaration the Property
Trustee shall deem it desirable to receive instructions with respect to
enforcing any remedy or right or taking any other action hereunder, the Property
Trustee (i) may request instructions from the Holders of the Trust Securities,
which instructions may only be given by the Holders of the same proportion in
Liquidation Amount of the Trust Securities as would be entitled to direct the
Property Trustee under the terms of the Trust Securities in respect of such
remedy, right or action, (ii) may refrain from enforcing such remedy or right or
taking such other action until such instructions are received, and (iii) shall
be fully protected in conclusively relying on or acting in accordance with such
instructions;
(k) except as otherwise expressly provided by this Declaration, the
Property Trustee shall not be under any obligation to take any action that is
discretionary under the provisions of this Declaration;
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(l) the Property Trustee shall not be liable for any action taken,
suffered, or omitted to be taken by it in good faith and reasonably believed by
it to be authorized or within the discretion or rights or powers conferred upon
it by this Declaration; and
(m) in the event that the Property Trustee is also acting as a Paying
Agent, Conversion Agent, and/or Securities Registrar hereunder, the rights and
protections afforded to the Property Trustee pursuant to this Article 8 shall
also be afforded to such Paying Agent, Conversion Agent, and/or Securities
Registrar.
No provision of this Declaration shall be deemed to impose any
duty or obligation on the Property Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it, in any
jurisdiction in which it shall be illegal, or in which the Property Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts, or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Property Trustee
shall be construed to be a duty.
SECTION 8.4. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF
SECURITIES. The recitals contained herein and in the Trust Securities
Certificates shall not be taken as the statements of the Trustees, and the
Trustees do not assume any responsibility for their correctness. The Trustees
shall not be accountable for the use or application by the Depositor of the
proceeds of the Debentures.
SECTION 8.5. MAY HOLD SECURITIES. Except as provided in the
definition of the term "Outstanding" in Article 1, any Trustee or any other
agent of any Trustee or the Trust, in its individual or any other capacity, may
become the owner or pledgee of Trust Securities and, subject to Section 8.8 and
8.12, may otherwise deal with the Trust with the same rights it would have if it
were not a Trustee or such other agent.
SECTION 8.6. COMPENSATION; INDEMNITY; FEES.
The Depositor agrees:
(a) to pay the Trustees from time to time reasonable compensation for
all services rendered by them hereunder (which compensation shall not be limited
by any provision of law in regard to the compensation of a trustee of an express
trust);
(b) except as otherwise expressly provided herein, to reimburse the
Trustees upon request for all reasonable expenses, disbursements and advances
incurred or made by the Trustees in accordance with any provision of this
Declaration (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense, disbursement
or advance as may be attributable to its gross negligence or bad faith (except
ordinary negligence in the case of the Property Trustee);
(c) to the fullest extent permitted by applicable law, to indemnify
and hold harmless (i) each Trustee, (ii) any Affiliate of any Trustee, (iii) any
officer, director, shareholder, employee, representative or agent of any
Trustee, and (iv) any employee or agent of the Trust or its Affiliates (referred
to herein as an "Indemnified Person") from and against any loss, damage,
liability, tax,
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penalty, expense or claim of any kind or nature whatsoever incurred by such
Indemnified Person by reason of the creation, operation, dissolution or
termination of the Trust or in connection with the administration of the
Trust or any act or omission performed or omitted by such Indemnified Person
in good faith on behalf of the Trust and in a manner such Indemnified Person
reasonably believed to be within the scope of authority conferred on such
Indemnified Person by this Declaration, except that no Indemnified Person
shall be entitled to be indemnified in respect of any loss, damage or claim
incurred by such Indemnified Person by reason of gross negligence or willful
misconduct with respect to such acts or omissions (except ordinary negligence
in the case of the Property Trustee);
(d) the provisions of this Section 8.6 shall survive any Trustee's
resignation or removal or termination of this Declaration;
(e) no Trustee may claim any lien or charge on any Trust Property as a
result of any amount due pursuant to this Section 8.6; and
(f) the provisions of this Section 8.6 shall survive termination of
this Declaration or the resignation of removal of any Trustee.
SECTION 8.7. PROPERTY TRUSTEE REQUIRED; ELIGIBILITY OF
TRUSTEES. (a) There shall at all times be a Property Trustee hereunder with
respect to the Trust Securities. The Property Trustee shall be a Person that is
eligible pursuant to the Trust Indenture Act to act as such and has a combined
capital and surplus of at least $50,000,000. If any such Person publishes
reports of condition at least annually, pursuant to law or to the requirements
of its supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such person shall be deemed to be
its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time the Property Trustee with respect to the
Trust Securities 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. The initial Property Trustee shall be
The First National Bank of Chicago
(b) There shall at all times be one or more Administrative Trustees
hereunder with respect to the Trust Securities. Each Administrative Trustee
shall be either a natural person who is at least 21 years of age or a legal
entity that shall act through one or more persons authorized to bind that
entity. The initial Administrative Trustees shall be Dugald K. Campbell,
Anthony A. Barone and James R. Lozelle.
(c) There shall at all times be a Delaware Trustee with respect to the
Trust Securities. The Delaware Trustee shall either be (i) a natural person who
is at least 21 years of age and a resident of the State of Delaware or (ii) a
legal entity with its principal place of business in the State of Delaware and
that otherwise meets the requirements of applicable Delaware law that shall act
through one or more persons authorized to bind such entity. The initial
Delaware Trustee shall be First Chicago Delaware Inc.
SECTION 8.8. CONFLICTING INTERESTS. If the Property Trustee
has or shall acquire a conflicting interest within the meaning of the Trust
Indenture Act, the Property Trustee
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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 Declaration.
SECTION 8.9. RESIGNATION AND REMOVAL; APPOINTMENT OF
SUCCESSOR.(a) Subject to Sections 8.9(b) and 8.9(c), Trustees (the "Relevant
Trustee") may be appointed or removed without cause at any time:
(i) until the issuance of any Trust Securities, by written
instrument executed by the Depositor; and
(ii) after the issuance of any Securities, by vote of the
Holders of a majority in Liquidation Amount of the Common Securities
voting as a class; PROVIDED, HOWEVER, that if a Event of Default shall
have occurred and be continuing, the Property Trustee may be removed and
a successor thereto appointed only by the Holders of a Majority in
Liquidation Amount of the Preferred Securities.
(b) The Trustee that acts as Property Trustee shall not be removed in
accordance with Section 8.9(a) until a successor possessing the qualifications
to act as a Property Trustee under Section 8.7 (a "Successor Property Trustee")
has been appointed and has accepted such appointment by instrument executed by
such Successor Property Trustee and delivered to the Trust, the Depositor and
the removed Property Trustee.
(c) The Trustee that acts as Delaware Trustee shall not be removed in
accordance with Section 8.9(a) until a successor possessing the qualifications
to act as Delaware Trustee under Section 8.7 (a "Successor Delaware Trustee")
has been appointed and has accepted such appointment by instrument executed by
such Successor Delaware Trustee and delivered to the Trust, the Depositor and
the removed Delaware Trustee.
(d) A Trustee appointed to office shall hold office until his, her or
its successor shall have been appointed or until his, her or its death,
removal, resignation, dissolution or liquidation. Any Trustee may resign from
office (without need for prior or subsequent accounting) by an instrument in
writing signed by the Trustee and delivered to the Depositor and the Trust,
which resignation shall take effect upon such delivery or upon such later date
as is specified therein; PROVIDED, HOWEVER, that:
(i) No such resignation of the Trustee that acts as the
Property Trustee shall be effective:
(a) until a Successor Property Trustee has been
appointed and has accepted such appointment by instrument executed
by such Successor Property Trustee and delivered to the Trust, the
Depositor and the resigning Property Trustee; or
(b) until the assets of the Trust have been completely
liquidated and the proceeds thereof distributed to the Holders of
the Securities;
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(ii) no such resignation of the Trustee that acts as the
Delaware Trustee shall be effective until a Successor Delaware Trustee
has been appointed and has accepted such appointment by instrument
executed by such Successor Delaware Trustee and delivered to the Trust,
the Depositor and the resigning Delaware Trustee; and
(iii) no appointment of a successor Property Trustee or Delaware
Trustee shall be effective until all fees, charges, and expenses of the
retiring Property Trustee or retiring Delaware Trustee, as the case may
be, have been paid.
(e) The Holders of the Common Securities shall use their best efforts
to promptly appoint a Successor Property Trustee or Successor Delaware Trustee,
as the case may be, if the Property Trustee or the Delaware Trustee delivers an
instrument of resignation in accordance with Section 8.9(d).
(f) If no Successor Property Trustee or Successor Delaware Trustee
shall have been appointed and accepted appointment as provided in this Section
8.9 within 60 days after delivery pursuant to this Section 8.9 of an instrument
of resignation or removal, the Property Trustee or Delaware Trustee resigning or
being removed, as applicable, may petition any court of competent jurisdiction
for appointment of a Successor Property Trustee or Successor Delaware Trustee.
Such court may thereupon, after prescribing such notice, if any, as it may deem
proper and prescribe, appoint a Successor Property Trustee or Successor Delaware
Trustee, as the case may be.
(g) No Property Trustee or Delaware Trustee shall be liable for the
acts or omissions to act of any Successor Property Trustee or Successor Delaware
Trustee, as the case may be.
(h) The Property Trustee shall give notice of each resignation and
each removal of a Trustee and each appointment of a successor Trustee to all
Securityholders in the manner provided in Section 10.8 and shall give notice to
the Depositor. Each notice shall include the name of the successor Relevant
Trustee and the address of its Corporate Trust Office if it is the Property
Trustee.
(i) Notwithstanding the foregoing or any other provision of this
Declaration, in the event any Administrative Trustee or a Delaware Trustee who
is a natural person dies or becomes, in the opinion of the Depositor,
incompetent or incapacitated, the vacancy created by such death, incompetence or
incapacity may be filled by (a) the unanimous act of the remaining
Administrative Trustees if there are at least two of them or (b) otherwise by
the Depositor (with the successor in each case being a Person who satisfies the
eligibility requirement for Administrative Trustees or the Delaware Trustee, as
the case may be, set forth in Section 8.7).
SECTION 8.10. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR. In case
of the appointment hereunder of a successor Relevant Trustee, the retiring
Relevant Trustee and each successor Relevant Trustee shall execute and deliver
an amendment hereto wherein each successor Relevant Trustee shall accept such
appointment and which (a) shall contain such provisions as shall be necessary or
desirable to transfer and confirm to, and to vest in, each successor Relevant
Trustee all the rights, powers, trusts and duties of the retiring Relevant
Trustee and (b) shall add to or change any of the provisions of this Declaration
as shall be necessary to provide for or facilitate the administration of the
trusts hereunder by more than one Relevant Trustee, it being understood that
nothing herein or in such amendment shall constitute such Relevant Trustees
co-trustees and upon
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the execution and delivery of such amendment the resignation or removal of
the retiring Relevant Trustee shall become effective to the extent provided
therein and each such successor Relevant Trustee, without any further act,
deed or conveyance, shall become vested with all the rights, powers, trusts
and duties of the retiring Relevant Trustee; but, on request of the Trust or
any successor Relevant Trustee, such retiring Relevant Trustee shall duly
assign, transfer and deliver to such successor Relevant Trustee all Trust
Property, all proceeds thereof and money held by such retiring Relevant
Trustee hereunder.
Upon request of any such successor Relevant Trustee, the Trust
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Relevant Trustee all such rights, powers and
trusts referred to in the first or second preceding paragraph, as the case may
be.
No successor Relevant Trustee shall accept its appointment unless
at the time of such acceptance such successor Relevant Trustee shall be
qualified and eligible under this Article.
SECTION 8.11. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
BUSINESS. Any Person into which the Property Trustee, the Delaware Trustee or
any Administrative Trustee that is not a natural person 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 Relevant Trustee
shall be a party, or any corporation succeeding to all or substantially all the
corporate trust business of such Relevant Trustee, shall be the successor of
such Relevant Trustee hereunder; provided that 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.
SECTION 8.12. PREFERENTIAL COLLECTION OF CLAIMS AGAINST
DEPOSITOR OR TRUST. If and when the Property Trustee shall be or become a
creditor of the Depositor or the Trust (or any other obligor upon the Debentures
or the Trust Securities), the Property Trustee shall be subject to and shall
take all actions necessary in order to comply with the provisions of the Trust
Indenture Act regarding the collection of claims against the Depositor or Trust
(or any such other obligor).
SECTION 8.13. REPORTS BY PROPERTY TRUSTEE.(a) To the extent
required by the Trust Indenture Act, within 60 days after May 15 of each year
commencing with May 15, 1999 the Property Trustee shall transmit to all
Securityholders in accordance with Section 10.8 and to the Depositor, a brief
report dated as of such May 15 with respect to:
(i) its eligibility under Section 8.7 or, in lieu thereof, if
to the best of its knowledge it has continued to be eligible under said
Section, a written statement to such effect;
(ii) a statement that the Property Trustee has complied with all
of its obligations under this Declaration during the twelve-month period
(or, in the case of the initial report, the period since the Closing
Date) ending with such May 15 or, if the Property Trustee has not
complied in any material respects with such obligations, a description of
such noncompliance;
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(iii) any change in the property and funds in its possession as
Property Trustee since the date of its last report and any action taken
by the Property Trustee in the performance of its duties hereunder which
it has not previously reported and which in its opinion materially
affects the Trust Securities; and
(iv) such other information as is required by Section 313(a) of
the Trust Indenture Act.
(b) In addition, the Property Trustee shall transmit to
Securityholders such reports concerning the Property Trustee and its actions
under this Declaration as may be required pursuant to the Trust Indenture Act at
the times and in the manner provided pursuant thereto.
(c) A copy of such report shall, at the time of such transmissions to
Holders, be filed by the Property Trustee with each national securities exchange
or self-regulatory organization upon which the Trust Securities are listed, with
the Commission and with the Depositor.
SECTION 8.14. REPORTS TO THE PROPERTY TRUSTEE. The Depositor
and the Administrative Trustees on behalf of the Trust shall provide to the
Property Trustee such documents, reports and information as are required by
Section 314 of the Trust Indenture Act (if any) and the compliance
certificate required by Section 314(a) of the Trust Indenture Act in the
form, in the manner and at the times required by Section 314 of the Trust
Indenture Act.
SECTION 8.15. EVIDENCE OF COMPLIANCE WITH CONDITIONS
PRECEDENT. Each of the Depositor and the Administrative Trustees on behalf of
the Trust shall provide to the Property Trustee such evidence of compliance
with any conditions precedent, if any, provided for in this Declaration that
relate to any of the matters set forth in Section 314(c) of the Trust
Indenture Act. Any certificate or opinion required to be given by an officer
pursuant to Section 314(c)(1) of the Trust Indenture Act shall be given in
the form of an Officers' Certificate.
SECTION 8.16. NUMBER OF TRUSTEES. (a) The number of Trustees
initially shall be five (5), and:
(i) at any time before the issuance of any Trust Securities,
the Depositor may, by written instrument, increase or decrease the number
of Trustees; and
(ii) after the issuance of any Trust Securities, the number of
Trustees may be increased or decreased by vote of the Holders of a
Majority in Liquidation Amount of the Common Securities voting as a class
at a meeting of the Holders of the Common Securities; PROVIDED, HOWEVER,
that the number of Trustees shall in no event be less than three (3);
provided, further, that (1) if required by the Business Trust Act, one
Trustee is the Delaware Trustee; (2) there shall be at least one Trustee
who is an employee or officer of, or is affiliated with, the Company
(each, an "Administrative Trustee"); and (3) one Trustee shall be the
Property Trustee for so long as this Declaration is required to qualify
as an indenture under the Trust Indenture Act, and such Property Trustee
may also serve as Delaware Trustee if it meets the applicable
requirements.
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(b) If a Trustee ceases to hold office for any reason and the number
of Administrative Trustees is not reduced pursuant to Section 8.16(a), or if the
number of Trustees is increased pursuant to Section 8.16(a), a vacancy shall
occur.
(c) The death, resignation, retirement, removal, bankruptcy,
incompetence or incapacity to perform the duties of a Trustee shall not operate
to dissolve, terminate or annul the Trust. Whenever a vacancy in the number of
Administrative Trustees shall occur, until such vacancy is filled by the
appointment of an Administrative Trustee in accordance with Section 8.9, the
Administrative Trustees in office, regardless of their number (and
notwithstanding any other provision of this Agreement), shall have all the
powers granted to the Administrative Trustees and shall discharge all the duties
imposed upon the Administrative Trustees by this Declaration.
SECTION 8.17. DELEGATION OF POWER. (a) Any Administrative
Trustee may, by power of attorney consistent with applicable law, delegate to
any other natural person over the age of 21 his or her power for the purpose of
executing any documents contemplated in Section 2.7(a), including any
registration statement or amendment thereof filed with the Commission, or making
any other governmental filing.
(b) The Administrative Trustees shall have power to delegate from time
to time to such of their number or to the Depositor the doing of such things and
the execution of such instruments either in the name of the Trust or the names
of the Administrative Trustees or otherwise as the Administrative Trustees may
deem expedient, to the extent such delegation is not prohibited by applicable
law or contrary to the provisions of the Trust, as set forth herein.
ARTICLE 9
DISSOLUTION, LIQUIDATION AND MERGER
SECTION 9.1. DISSOLUTION UPON EXPIRATION DATE. Unless earlier
dissolved, the Trust shall automatically dissolve on June 30, 2033 (the
"Expiration Date").
SECTION 9.2. EARLY DISSOLUTION. The first to occur of any of
the following events is an "Early Dissolution Event":
(a) the occurrence of a Bankruptcy Event in respect of, or the
dissolution or liquidation of, the Depositor;
(b) the occurrence of a Special Event except in the case of a Tax
Event following which the Depositor has elected (i) to pay any Additional Sums
(in accordance with Section 4.4) such that the net amount received by Holders of
Preferred Securities in respect of Distributions are not reduced as a result of
such Tax Event and the Depositor has not revoked any such election or failed to
make such payments or (ii) to redeem all or some of the Debentures pursuant to
Section 4.4(a);
(c) the redemption, conversion or exchange of all of the Trust
Securities;
(d) an order for dissolution of the Trust shall have been entered by a
court of competent jurisdiction; and
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(e) receipt by the Property Trustee of written notice from the
Depositor at any time (which direction is optional and wholly within the
discretion of the Depositor) of its intention to dissolve the Trust and
distribute the Debentures in exchange for the Preferred Securities.
SECTION 9.3. DISSOLUTION. The respective obligations and
responsibilities of the Trustees and the Trust created and continued hereby
shall terminate upon the latest to occur of the following: (a) the distribution
by the Property Trustee to Securityholders upon the liquidation of the Trust
pursuant to Section 9.4, or upon the redemption of all of the Trust Securities
pursuant to Section 4.2, of all amounts required to be distributed hereunder
upon the final payment of the Trust Securities; (b) the payment of all expenses
owed by the Trust; (c) the discharge of all administrative duties of the
Administrative Trustees, including the performance of any tax reporting
obligations with respect to the Trust or the Securityholders; and (d) the filing
of a certificate of cancellation by the Trustees in accordance with Section 3810
of the Delaware Business Trust Act.
SECTION 9.4. LIQUIDATION. (a) If an Early Dissolution Event
specified in clause (a), (b), (d) or (e) of Section 9.2 occurs or upon the
Expiration Date, the Trust shall be liquidated by the Trustees as expeditiously
as the Trustees determine to be possible by distributing, after satisfaction of
liabilities to creditors of the Trust as provided by applicable law, to each
Securityholder an aggregate principal amount of Debentures equal to the
aggregate Liquidation Amount of Trust Securities held by such Holder, subject to
Section 9.4(d). Notice of liquidation shall be given by the Property Trustee by
first-class mail, postage prepaid, mailed not later than 30 nor more than 60
days prior to the Liquidation Date to each Holder of Trust Securities at such
Holder's address as it appears in the Securities Register. All notices of
liquidation shall:
(i) state the Liquidation Date;
(ii) state that, from and after the Liquidation Date, the Trust
Securities will no longer be deemed to be Outstanding and any Trust
Securities Certificates not surrendered for exchange will be deemed to
represent an aggregate principal amount of Debentures equal to the
aggregate Liquidation Amount of Preferred Securities held by such Holder;
and
(iii) provide such information with respect to the mechanics by
which Holders may exchange Trust Securities Certificates for Debentures,
or, if Section 9.4(d) applies, receive a Liquidation Distribution, as the
Administrative Trustees or the Property Trustee shall deem appropriate.
(b) Except where Section 9.2(c) or 9.4(d) applies, in order to effect
the liquidation of the Trust and distribution of the Debentures to
Securityholders, the Property Trustee shall establish a record date for such
distribution (which shall be not more than 45 days prior to the Liquidation Date
and, unless the Property Trustee determines otherwise, shall be the date which
is the fifteenth day (whether or not a Business Day) next preceding the
Liquidation Date) and, either itself acting as exchange agent or through the
appointment of a separate exchange agent, shall establish such procedures as it
shall deem appropriate to effect the distribution of Debentures in exchange for
the Outstanding Trust Securities Certificates.
(c) Except where Section 9.2(c) or 9.4(d) applies, after the
Liquidation Date, (i) the Trust Securities will no longer be deemed to be
Outstanding, (ii) the Clearing Agency or its nominee, as
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the record holder of such Trust Securities, will receive a registered global
certificate or certificates representing the Debentures to be delivered upon
such distribution and (iii) any Trust Securities Certificates not held by the
Clearing Agency or its nominee will be deemed to represent an aggregate
principal amount of Debentures equal to the aggregate Liquidation Amount of
Preferred Securities held by such Holders, and bearing accrued and unpaid
interest in an amount equal to the accrued and unpaid Distributions on such
Trust Securities until such certificates are presented to the Property
Trustee for transfer or reissuance.
(d) In the event that, notwithstanding the other provisions of this
Section 9.4, whether because of an order for dissolution entered by a court of
competent jurisdiction or otherwise, distribution of the Debentures in the
manner provided herein is determined by the Property Trustee not to be
practicable, the Trust Property shall be liquidated, and the Trust shall be
wound-up or terminated, by the Property Trustee in such manner as the Property
Trustee determines, and an Administrative Trustee shall prepare, execute and
file the certificate of cancellation with the Secretary of State of the State of
Delaware. In such event, Securityholders will be entitled to receive out of the
assets of the Trust available for distribution to Securityholders, after
satisfaction of liabilities to creditors of the Trust as provided by applicable
law, an amount equal to the Liquidation Amount per Trust Security plus accrued
and unpaid Distributions thereon to the date of payment (such amount being the
"Liquidation Distribution"). If, upon any such winding-up or termination, the
Liquidation Distribution can be paid only in part because the Trust has
insufficient assets available to pay in full the aggregate Liquidation
Distribution, then, subject to the next succeeding sentence, the amounts payable
by the Trust on the Trust Securities shall be paid on a PRO RATA basis (based
upon Liquidation Amounts). The Holder of the Common Securities will be entitled
to receive Liquidation Distributions upon any such winding-up or termination PRO
RATA (determined as aforesaid) with Holders of Preferred Securities, except
that, if a Debenture Event of Default has occurred and is continuing, the
Preferred Securities shall have a priority over the Common Securities.
SECTION 9.5. MERGERS, CONSOLIDATIONS, AMALGAMATIONS OR
REPLACEMENTS OF THE TRUST. The Trust may not merge with or into, consolidate,
amalgamate, or be replaced by, or convey, transfer or lease its properties and
assets substantially as an entirety to any Person, except pursuant to this
Section 9.5 or Section 9.4. At the request of the Depositor, with the consent
of the Administrative Trustees and without the consent of the Property Trustee
or the Holders of the Preferred Securities, the Trust may merge with or into,
consolidate, amalgamate, be replaced by or convey, transfer or lease its
properties and assets substantially as an entirety to a trust organized as such
under the laws of any State; provided, that (i) if the Trust is not the
survivor, (a) such successor entity either expressly assumes all of the
obligations of the Trust with respect to the Preferred Securities or (b)
substitutes for the Preferred Securities other securities having substantially
the same terms as the Preferred Securities (the "Successor Securities") so long
as the Successor Securities rank the same as the Preferred Securities and rank
in priority with respect to Distributions and payments upon liquidation,
redemption and otherwise, (ii) the Depositor expressly appoints a trustee of
such successor entity possessing the same powers and duties as the Property
Trustee as the holder of the Debentures, (iii) the Successor Securities are
listed, or any Successor Securities will be listed upon notification of
issuance, on any national securities exchange or other organization on which the
Preferred Securities are then listed, if any, (iv) such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease does not cause the
Preferred Securities (including any Successor Securities) to be downgraded by
any nationally recognized statistical rating organization,
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(v) such merger, consolidation, amalgamation, replacement, conveyance,
transfer or lease does not adversely affect the rights, preferences and
privileges of the Holders of the Preferred Securities (including any
Successor Securities) in any material respect, (vi) such successor entity has
a purpose substantially identical to that of the Trust, (vii) prior to such
merger, consolidation, amalgamation, replacement, conveyance, transfer or
lease the Depositor has received an Opinion of Counsel to the effect that (a)
such merger, consolidation, amalgamation, replacement, conveyance, transfer
or lease will not adversely affect the rights, preferences and privileges of
the Holders of the Preferred Securities (including any Successor Securities)
in any material respect (other than with respect to any dilution of the
Holder's interest in the new entity), (b) following such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease
neither the Trust nor such successor entity will be required to register as
an investment company under the 1940 Act, and (c) following such merger,
consolidation, amalgamation or replacement, the Trust or such successor
entity will be treated as a grantor trust for United States Federal income
tax purposes and (viii) the Depositor or any permitted successor or assignee
owns, directly or indirectly, all of the common securities of such successor
entity and guarantees the obligations of such successor entity under the
Successor Securities at least to the extent provided by the Guarantee.
Notwithstanding the foregoing, the Trust shall not, except with the consent
of Holders of 100% in aggregate Liquidation Amount of the Preferred
Securities, consolidate, amalgamate, merge with or into, be replaced by or
convey, transfer or lease its properties and assets substantially as an
entirety to any other entity or permit any other entity to consolidate,
amalgamate, merge with or into, or replace it if such consolidation,
amalgamation, merger, replacement, conveyance, transfer or lease would cause
the Trust or the successor entity to be classified as other than a grantor
trust for United States Federal income tax purposes.
ARTICLE 10
MISCELLANEOUS PROVISIONS
SECTION 10.1. LIMITATION OF RIGHTS OF SECURITYHOLDERS. Other
than as set forth in Section 9.1, the death, incapacity, dissolution,
bankruptcy or termination of any Person having an interest, beneficial or
otherwise, in Trust Securities shall not operate to dissolve the Trust or
terminate this Declaration, nor entitle the legal representatives or heirs of
such Person or any Securityholder for such Person to claim an accounting,
take any action or bring any proceeding in any court for a partition or
winding-up of the arrangements contemplated hereby, nor otherwise affect the
rights, obligations and liabilities of the parties hereto or any of them.
SECTION 10.2. AMENDMENTS. (a) Except as otherwise provided in
this Declaration or by any applicable terms of the Trust Securities, this
Declaration may only be amended by a written instrument approved and executed
by:
(i) the Administrative Trustees (or, if there are more than two
Administrative Trustees, a majority of the Administrative Trustees);
(ii) if the amendment affects the rights, powers, duties,
obligations or immunities of the Property Trustee, the Property Trustee;
and
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(iii) if the amendment affects the rights, powers, duties,
obligations or immunities of the Delaware Trustee, the Delaware Trustee.
(b) No amendment shall be made, and any such purported amendment shall
be void and ineffective:
(i) unless, in the case of any proposed amendment, the Property
Trustee shall have first received an Officers' Certificate from each of
the Trust and the Depositor that such amendment is permitted by, and
conforms to, the terms of this Declaration;
(ii) unless, in the case of any proposed amendment which affects
the rights, powers, duties, obligations or immunities of the Property
Trustee, the Property Trustee shall have first received an Opinion of
Counsel (who may be counsel to the Depositor or the Trust) that such
amendment is permitted by, and conforms to, the terms of this
Declaration; and
(iii) to the extent the result of such amendment would be to:
(A) cause the Trust to fail to continue to be
classified for purposes of United States federal income taxation
as a grantor trust;
(B) cause the Trust to be taxable as a corporation;
(C) reduce or otherwise adversely affect the powers of
the Property Trustee in contravention of the Trust Indenture Act;
or
(D) cause the Trust to be deemed to be an Investment
Company required to be registered under the 1940 Act.
(c) In the event the consent of the Property Trustee, as the Holder of
the Debentures, is required under the Subordinated Indenture with respect to any
amendment, modification or termination of the Subordinated Indenture or the
Debentures, the Property Trustee shall request the direction of the Holders of
the Trust Securities with respect to such amendment, modification or termination
and shall vote with respect to such amendment, modification or termination as
directed by a Majority in Liquidation Amount of the Trust Securities voting
together as a single class; PROVIDED, HOWEVER, that where a consent under the
Subordinated Indenture would require the consent of a Super Majority of the
Holders of Debentures the Property Trustee may only give such consent at the
direction of the Holders of at least the proportion in Liquidation Amount of the
Trust Securities which the relevant Super Majority represents of the aggregate
principal amount of the Debentures outstanding; provided, further, that the
Property Trustee shall not be obligated to take any action in accordance with
the directions of the Holders of the Trust Securities under this Section 10.2(c)
unless the Property Trustee has obtained an Opinion of Counsel (which counsel
shall be independent tax counsel) to the effect that for United States federal
income tax purposes the Trust will continue to be classified as a grantor trust
after consummation of such action and each Holder will be treated as owning an
undivided beneficial ownership interest in the Debentures.
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(d) At such time after the Trust has issued any Trust Securities that
remain outstanding, any amendment that would (i) adversely affect the powers,
preferences or special rights of the Trust Securities or (ii) provide for the
dissolution, winding-up or termination of the Trust other than pursuant to the
terms of this Declaration, may be effected only with the approval of the Holders
of at least a Majority in Liquidation Amount of the Trust Securities affected
thereby; provided, that if any amendment or proposal referred to in clause (i)
hereof would adversely affect only the Preferred Securities or the Common
Securities, then only the affected class will be entitled to vote on such
amendment or proposal and such amendment or proposal shall not be effective
except with the approval of a Majority in Liquidation Amount of such class of
Trust Securities.
(e) This Section 10.2 shall not be amended without the consent of all
of the Holders of the Trust Securities.
(f) Section 2.6(c) shall not be amended without the consent of the
Holders of a Majority in Liquidation Amount of the Common Securities.
(g) The rights of the Holders of the Common Securities under Article
VIII to increase or decrease the number of, and appoint and remove, Trustees
shall not be amended without the consent of the Holders of a Majority in
Liquidation Amount of the Common Securities.
(h) Notwithstanding Section 10.2(c), this Declaration may be amended
without the consent of the Holders of the Trust Securities:
(i) to cure any ambiguity;
(ii) to correct or supplement any provision in this Declaration
that may be defective or inconsistent with any other provision of this
Declaration, or to make any other provisions with respect to matters or
questions arising under this Declaration that shall not be inconsistent
with the other provisions of this Declaration;
(iii) to add to the covenants, restrictions or obligations of the
Depositor;
(iv) to conform to any change in the 1940 Act or written change
in interpretation or application of the rules and regulations promulgated
thereunder by any legislative body, court, government agency or
regulatory authority;
(v) to conform to any change in the Trust Indenture Act or
written change in interpretation or application of the rules and
regulations promulgated thereunder by any legislative body, court,
government agency or regulatory authority; or
(vi) to modify, eliminate and add to any provision of this
Declaration to such extent as may be necessary;
provided, that such amendments do not have a material adverse effect on the
rights, preferences or privileges of the Holders.
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SECTION 10.3. SEPARABILITY. In case any provision in this
Declaration or in the Trust Securities Certificates 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 10.4. GOVERNING LAW. THIS DECLARATION AND THE RIGHTS
AND OBLIGATIONS OF EACH OF THE SECURITYHOLDERS, THE TRUST AND TRUSTEES WITH
RESPECT TO THIS DECLARATION IN THE TRUST SECURITIES SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF DELAWARE WITHOUT REGARD
TO ITS CONFLICT OF LAWS PRINCIPLES AND EXCLUDING SECTIONS 3540 AND 3561 OF TITLE
12 THEREOF.
SECTION 10.5. PAYMENTS DUE ON NON-BUSINESS DAY. If the date
fixed for any payment on any Trust Security shall be a day which is not a
Business Day, then such payment need not be made on such date but may be made on
the next succeeding day which is a Business Day (except as otherwise provided in
Sections 4.1(a) and 4.2(d)), with the same force and effect as though made on
the date fixed for such payment, and no interest shall accrue thereon for the
period after such date.
SECTION 10.6. SUCCESSORS. This Declaration shall be binding
upon and shall inure to the benefit of any successor to the Depositor, the Trust
or the Relevant Trustee, including any successor by operation of law. Except in
connection with a transaction that is permitted under Article 8 of the
Subordinated Indenture and pursuant to which the assignee agrees in writing to
perform the Depositor's obligations hereunder, the Depositor shall not assign
its obligations hereunder.
SECTION 10.7. HEADINGS. The Article and Section headings are
for convenience only and shall not affect the construction of this Declaration.
SECTION 10.8. REPORTS, NOTICES AND DEMANDS. Any report, notice,
demand or other communications which by any provision of this Declaration is
required or permitted to be given or served to or upon any Securityholder or the
Depositor may be given or served in writing by deposit thereof, first-class
postage prepaid, in the United States mail, hand delivery or facsimile
transmission, in each case, addressed, (a) in the case of a Holder of Preferred
Securities, to such Holder as such Holder's name and address may appear on the
Securities Register; and (b) in the case of the Holder of the Common Securities,
to Tower Automotive, Inc., 6303 28th Street S.E., Grand Rapids Michigan 49546.
Any notice, demand or other communication which by any provision
of this Declaration is required or permitted to be given or served to or upon
the Trust, the Property Trustee, the Delaware Trustee or the Administrative
Trustees shall be given in writing addressed (until another address is published
by the Trust) as follows: (a) with respect to the Property Trustee, to The
First National Bank of Chicago, (b) with respect to the Delaware Trustee, to
First Chicago, Delaware Inc., with a copy of any such notice to the Property
Trustee at its address above, and (c) with respect to the Administrative
Trustees, to them at the address for notices to the Depositor, marked
"Attention: Vice President - Treasurer." Such notice, demand or other
communication to or upon the Trust or the Property Trustee shall be deemed to
have been sufficiently given or made only upon actual receipt of the writing by
the Trust or the Property Trustee.
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SECTION 10.9. AGREEMENT NOT TO PETITION. Each of the Trustees
and the Depositor agrees for the benefit of the Securityholders that, until at
least one year and one day after the Trust has been dissolved in accordance with
Article 9, it shall not file, or join in the filing of, a petition against the
Trust under any bankruptcy, insolvency, reorganization or other similar law
(including, without limitation, the United States Bankruptcy Code)
(collectively, "Bankruptcy Laws") or otherwise join in the commencement of any
proceeding against the Trust under any Bankruptcy Law. In the event the
Depositor takes action in violation of this Section 10.9, the Property Trustee
agrees, for the benefit of Securityholders, that, at the expense of the
Depositor, it shall file an answer with the bankruptcy court or otherwise
properly contest the filing of such petition by the Depositor against the Trust
or the commencement of such action and raise the defense that the Depositor has
agreed in writing not to take such action and should be stopped and precluded
therefrom and such other defenses, if any, as counsel for the Trustee or the
Trust may assert. The provisions of this Section 10.9 shall survive the
dissolution of this Declaration.
SECTION 10.10. TRUST INDENTURE ACT; CONFLICT WITH TRUST INDENTURE
ACT. (a) This Declaration is subject to the provisions of the Trust Indenture
Act that are required to be part of this Declaration and shall, to the extent
applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is the
trustee for the purposes of the Trust Indenture Act.
(c) If any provision hereof limits, qualifies or conflicts with
another provision hereof which is required to be included in this Declaration by
any of the provisions of the Trust Indenture Act, such required provision shall
control. If any provision of this Declaration modifies or excludes any
provision of the Trust Indenture Act which may be so modified or excluded, the
latter provision shall be deemed to apply to this Declaration as so modified or
to be excluded, as the case may be.
(d) The application of the Trust Indenture Act to this Declaration
shall not affect the nature of the Trust Securities as equity securities
representing undivided beneficial interests in the assets of the Trust.
SECTION 10.11. ACCEPTANCE OF TERMS OF DECLARATION, GUARANTEE AND
SUBORDINATED INDENTURE. THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY
INTEREST THEREIN BY OR ON BEHALF OF A SECURITYHOLDER OR BENEFICIAL OWNER,
WITHOUT ANY SIGNATURE OR FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE
UNCONDITIONAL ACCEPTANCE BY THE SECURITYHOLDER AND ALL OTHERS HAVING A
BENEFICIAL INTEREST IN SUCH TRUST SECURITY OF ALL THE TERMS AND PROVISIONS OF
THIS DECLARATION AND AGREEMENT TO SUBORDINATION PROVISIONS AND OTHER TERMS OF
THE GUARANTEE AND THE SUBORDINATED INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT
OF THE TRUST, SUCH SECURITYHOLDER AND SUCH OTHERS THAT THE TERMS AND PROVISIONS
OF THIS DECLARATION SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS THE AGREEMENT
OF THE TRUST AND SUCH SECURITYHOLDER AND SUCH OTHERS.
SECTION 10.12. COUNTERPARTS. This Declaration may contain more
than one counterpart of the signature page and this Declaration may be executed
by the affixing of the
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signature of each of the Trustees to one of such counterpart signature pages.
All of such counterpart signature pages shall be read as though one, and
they shall have the same force and effect as though all of the signers had
signed a single signature page.
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IN WITNESS WHEREOF, the parties hereto have caused this
Declaration to be duly executed as of the day and year first above written.
TOWER AUTOMOTIVE, INC.,
as Depositor
By: /s/ Anthony A. Barone
-------------------------------
Name: Anthony A. Barone
Title: Vice President and Chief
Financial Officer
THE FIRST NATIONAL BANK OF CHICAGO,
as Property Trustee
By: /s/ Victoria Y. Douyon
-------------------------------
Name: Victoria Y. Douyon
-------------------------------
Title: Vice President
-------------------------------
FIRST CHICAGO DELAWARE INC.,
as Delaware Trustee
By: /s/ L. Dillard
-------------------------------
Name: L. Dillard
-------------------------------
Title: Vice President
-------------------------------
/s/ Dugald K. Campbell
--------------------------------------
Dugald K. Campbell,
as Administrative Trustee
/s/ Anthony A. Barone
--------------------------------------
Anthony A. Barone,
as Administrative Trustee
/s/ James R. Lozelle
--------------------------------------
James R. Lozelle,
as Administrative Trustee
<PAGE>
EXHIBIT A -- Certificate of Trust of
Tower Automotive Capital Trust
CERTIFICATE OF TRUST
OF
TOWER AUTOMOTIVE CAPITAL TRUST
THIS Certificate of Trust of Tower Automotive Capital Trust (the
"Trust"), dated as of June 3, 1998, is being duly executed and filed by the
undersigned, as trustees, to form a business trust under the Delaware Business
Trust Act (12 DEL. C. Section 3801 ET SEQ.).
1. NAME. The name of the business trust formed hereby is
Tower Automotive Capital Trust.
2. DELAWARE TRUSTEE. The name and business address of the
trustee of the Trust with a principal place of business in the State of Delaware
are First Chicago Delaware Inc., 300 King Street, Wilmington, Delaware 1980.
3. EFFECTIVE DATE. This Certificate of Trust shall be
effective upon filing.
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust,
have executed this Certificate of Trust as of the date first-above written.
FIRST NATIONAL BANK OF CHICAGO, not in
its individual capacity but solely as
trustee of the Trust
By:
--------------------------------
Name:
--------------------------------
Title:
--------------------------------
Anthony A. Barone, not in his
individual capacity but solely as
trustee of the Trust
--------------------------------------
A-1
<PAGE>
EXHIBIT B -- Form of Certificate
Depositary Agreement
B-1
<PAGE>
EXHIBIT C -- Form of Common Securities of
Tower Automotive Capital Trust
THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY HAS NOT BEEN
REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED EXCEPT PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED UNDER THE
SECURITIES ACT OR PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT, IN EACH CASE, IN COMPLIANCE WITH ALL APPLICABLE SECURITIES LAWS
OF THE STATES OF THE UNITED STATES AND OTHER JURISDICTIONS. IN CONNECTION
WITH ANY TRANSFER OF THE SECURITY EVIDENCED HEREBY PRIOR TO THE EXPIRATION OF
THE HOLDING PERIOD APPLICABLE TO SALES OF THE SECURITY EVIDENCED HEREBY UNDER
RULE 144(k) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION), THE HOLDER
MUST DELIVER SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS TOWER
AUTOMOTIVE, INC., THE TRUSTEE OR THE TRANSFER AGENT, AS APPLICABLE, MAY
REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THIS LEGEND WILL BE REMOVED AFTER THE
EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THE SECURITY EVIDENCED
HEREBY UNDER RULE 144(k) UNDER THE SECURITIES ACT.
THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT TO AN ENTITY WHOLLY
OWNED BY TOWER AUTOMOTIVE, INC. OR TO CERTAIN SUCCESSORS OF TOWER AUTOMOTIVE,
INC.
C-1
<PAGE>
Certificate Number ____ Number of Common Securities _____
Certificate Evidencing Common Securities
of
Tower Automotive Capital Trust
Common Securities
(Liquidation Amount $50 per Common Security)
Tower Automotive Capital Trust, a statutory business trust created
under the laws of the State of Delaware (the "Trust"), hereby certifies that
Tower Automotive, Inc. (the "Holder") is the registered owner of ______________
common securities of the Trust representing undivided beneficial interests in
the assets of the Trust (the "Common Securities"). Except as set forth in
Section 5.10 of the Declaration (as defined below), the Common Securities are
not transferable and any attempted transfer hereof shall be void. The
designations, rights, privileges, restrictions, preferences and other terms and
provisions of the Common Securities are set forth in, and this certificate and
the Common Securities represented hereby are issued and shall in all respects be
subject to the terms and provisions of, the Amended and Restated Declaration of
Trust dated as of June 9, 1998, as the same may be amended from time to time
(the "Declaration") including the designation of the terms of the Common
Securities as set forth therein. The Holder is entitled to the benefits of the
Common Securities Guarantee Agreement entered into by Tower Automotive, Inc., a
Delaware corporation, and The First National Bank of Chicago, as Guarantee
Trustee, dated as of June 9, 1998 (the "Guarantee"), to the extent provided
therein. The Trust will furnish a copy of the Declaration and the Guarantee to
the Holder without charge upon written request to the Trust at its principal
place of business or registered office.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
C-2
<PAGE>
IN WITNESS WHEREOF, one of the Administrative Trustees of the
Trust has executed this certificate this 9th day of June, 1998.
TOWER AUTOMOTIVE CAPITAL TRUST
By:
---------------------------------------
Name:
---------------------------------------
As Administrative Trustee
PROPERTY TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Common Securities referred to in the
within-mentioned Declaration.
Dated:
--------------------
THE FIRST NATIONAL BANK OF CHICAGO,
as Property Trustee
By:
---------------------------------------
Name:
---------------------------------------
Authorized Signatory
C-3
<PAGE>
EXHIBIT D -- Form of Preferred Securities of
Tower Automotive Capital Trust
This Preferred Security is a Book-Entry Preferred Securities
Certificate within the meaning of the Declaration hereinafter referred to and is
registered in the name of The Depository Trust Company ("DTC") or a nominee of
DTC. This Preferred Security is exchangeable for Preferred Securities
registered in the name of a person other than DTC or its nominee only in the
limited circumstances described in the Declaration and no transfer of this
Preferred Security (other than a transfer of this Preferred Security as a whole
by DTC to a nominee of DTC or by a nominee of DTC to DTC or another nominee of
DTC) may be registered except in limited circumstances.
Unless this certificate is presented by an authorized
representative of DTC, to Issuer or its agent for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of
Cede & Co. or in such other name as is requested by an authorized representative
of DTC (and any payment is made to Cede & Co. or to such other entity as is
requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as
the registered owner hereof, Cede & Co., has an interest herein.
THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY HAS NOT BEEN
REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF,
U.S. PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION
HEREOF, THE HOLDER (1) REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL BUYER"
(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT), (2) AGREES THAT IT WILL NOT
RESELL OR OTHERWISE TRANSFER THE SECURITY EVIDENCED HEREBY OR THE COMMON STOCK,
IF ANY, ISSUABLE UPON CONVERSION OR EXCHANGE OF SUCH SECURITY EXCEPT (A) TO
TOWER AUTOMOTIVE, INC. OR A SUBSIDIARY THEREOF, (B) TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER PURCHASING FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A UNDER THE SECURITIES ACT, OR (C) PURSUANT
TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT
(IF AVAILABLE) AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE
SECURITY EVIDENCED HEREBY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND. IN CONNECTION WITH ANY TRANSFER OF THE SECURITY EVIDENCED HEREBY
PRIOR TO THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THE
SECURITY EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES ACT (OR ANY
SUCCESSOR PROVISION), THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE
REVERSE HEREOF
D-1
<PAGE>
RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS CERTIFICATE TO THE
TRUSTEE FOR THE PREFERRED SECURITIES OR THE DEBENTURES, AS THE CASE MAY BE
(OR, IF THIS CERTIFICATE EVIDENCES COMMON STOCK, SUCH HOLDER MUST FURNISH TO
THE TRANSFER AGENT), TOGETHER WITH SUCH CERTIFICATIONS, LEGAL OPINIONS OR
OTHER INFORMATION AS TOWER AUTOMOTIVE, INC., THE TRUSTEE OR THE TRANSFER
AGENT, AS APPLICABLE, MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS
BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO,
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THIS LEGEND WILL BE
REMOVED AFTER THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THE
SECURITY EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES ACT.
D-2
<PAGE>
Certificate Number ____ Number of Preferred Securities ______
CUSIP NO. 891706202
CERTIFICATE EVIDENCING PREFERRED SECURITIES
OF
TOWER AUTOMOTIVE CAPITAL TRUST
6 3/4% Convertible Preferred Securities
(Liquidation Amount $50 per Preferred Security)
Tower Automotive Capital Trust, a statutory business trust created
under the laws of the State of Delaware (the "Trust"), hereby certifies that
__________________ (the "Holder") is the registered owner of _______ preferred
securities of the Trust representing an undivided beneficial interest in the
assets of the Trust and designated the Tower Automotive Capital Trust 63/4%
Convertible Preferred Securities (Liquidation Amount $50 per Preferred Security)
(the "Preferred Securities"). Except to the extent set forth in the Declaration
(as defined below), the Preferred Securities are transferable on the books and
records of the Trust, in person or by a duly authorized attorney, upon surrender
of this certificate duly endorsed and in proper form for transfer as provided in
Section 5.4 of the Declaration (as defined below). The designations, rights,
privileges, restrictions, preferences and other terms and provisions of
the Preferred Securities are set forth in, and this certificate and the
Preferred Securities represented hereby are issued and shall in all respects be
subject to the terms and provisions of, the Amended and Restated Declaration of
Trust dated as of June 9, 1998 as the same may be amended from time to time (the
"Declaration") including the designation of the terms of Preferred Securities as
set forth therein. The Holder is entitled to the benefits of the Guarantee
Agreement entered into by Tower Automotive, Inc., a Delaware corporation, and
The First National Bank of Chicago, as Guarantee Trustee, dated as of June 9,
1998 (the "Guarantee"), to the extent provided therein. The Trust will furnish
a copy of the Declaration and the Guarantee to the Holder without charge upon
written request to the Trust at its principal place of business or registered
office.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
D-3
<PAGE>
IN WITNESS WHEREOF, one of the Administrative Trustees of the
Trust has executed this certificate this 9th day of June 1998.
TOWER AUTOMOTIVE CAPITAL TRUST
By:
---------------------------------------
Name:
---------------------------------------
An Administrative Trustee
PROPERTY TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Preferred Securities referred to in the
within-mentioned Declaration.
Dated:
----------------------
THE FIRST NATIONAL BANK OF CHICAGO,
as Property Trustee
By:
---------------------------------------
Name:
---------------------------------------
Authorized Signatory
D-4
<PAGE>
ASSIGNMENT FORM
To assign this Preferred Security, fill in the form below:
(i) or (we) assign and transfer this Preferred Security to
- -------------------------------------------------------------------------------
(Insert assignee's social security or tax I.D. no.)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint _______________________________________________________
agent to transfer this Preferred Security on the books of the Company. The
agent may substitute another to act for him.
Your Signature:
-------------------------------------------------------
(Sign exactly as your name appears on the
other side of this Security)
Date:
-----------------------
Signature Guarantee:*
--------------------------------------------------
[Include the following if the Preferred Security bears a Restricted Securities
Legend --
- -------------------------
* Signature must be guaranteed by an institution which is a member
of one of the following recognized Signature Guaranty Programs:
(i) The Securities Transfer Agent Medallion Program (STAMP); (ii)
The New York Stock Exchange Medallion Program (MSP); (iii) The
Stock Exchange Medallion Program (SEMP); or (iv) in such other
guarantee programs acceptable to the Trustee.
D-5
<PAGE>
In connection with any transfer of any of the Preferred Securities evidenced by
this certificate, the undersigned confirms that such Preferred Securities are
being:
CHECK ONE BOX BELOW
(1) / / exchanged for the undersigned's own account without
transfer; or
(2) / / transferred pursuant to and in compliance with Rule 144A
under the Securities Act of 1933; or
(3) / / transferred pursuant to another available exemption from
the registration requirements of the Securities Act of
1933; or
(4) / / transferred pursuant to an effective Registration Statement
under the Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register any of
the Preferred Securities evidenced by this certificate in the name of any
person other than the registered Holder thereof; PROVIDED, HOWEVER, that if box
(3) is checked, the Trustee may require, prior to registering any such transfer
of the Securities such legal opinions, certifications and other information as
the Company has reasonably requested in writing and directed the Trustee to
require confirmation that such transfer is being made pursuant to an exemption
from, or in a transaction not subject to, the registration requirements of the
Securities Act of 1933, such as the exemption provided by Rule 144 under such
Act; PROVIDED, FURTHER, that after the date that a shelf Registration Statement
under the Securities Act of 1933 has been filed and so long as such shelf
Registration Statement continues to be effective, the Trustee may only permit
transfers for which box (4) has been checked.
-----------------------------
Signature
Signature Guarantee:*
- ---------------------------------- -----------------------------
Signature must be guaranteed Signature
- ---------------------
(*) Signature must be guaranteed by an institution which is a member
of one of the following recognized Signature Guaranty Programs:
(i) The Securities Transfer Agent Medallion Program (STAMP); (ii)
The New York Stock Exchange Medallion Program (MSP); (iii) The
Stock Exchange Medallion Program (SEMP); or (iv) in such other
guarantee programs acceptable to the Trustee.
D-6
<PAGE>
- --------------------------------------------------------------------------------
Dated:
------------------------ ----------------------------------------------
NOTICE: To be executed by an executive officer
[TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this
Preferred Security for its own account or an account with respect to which it
exercises sole investment discretion and that it and any such account is a
"qualified institutional buyer" within the meaning of Rule 144A under the
Securities Act of 1933, and is aware that the sale to it is being made in
reliance on Rule 144A and acknowledges that it has received such information
regarding the Company as the undersigned has requested pursuant to Rule 144A or
has determined not to request such information and that it is aware that the
transferor is relying upon the undersigned's foregoing representations in order
to claim the exemption from registration provided by Rule 144A.
Dated:
------------------------ ----------------------------------------------
NOTICE: To be executed by an executive
officer]
D-7
<PAGE>
TO BE ATTACHED TO GLOBAL CERTIFICATE
SCHEDULE A
The initial Liquidation Amount of this Global Certificate shall be
$258,750,000. The following increases or decreases in the Liquidation Amount of
this Global Certificate have been made:
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Amount of increase in Liquidation Amount
Liquidation Amount of Amount of decrease of this Global Signature of
this Global Certificate in Liquidation Certificate authorized officer
including upon exercise Amount of this following such of Trustee or
Date Made of over-allotment option Global Certificate decrease or increase Securities Custodian
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
EXHIBIT E -- Form of Restricted
Securities Certificate
RESTRICTED SECURITIES CERTIFICATE
(For transfers pursuant to Sections 5.4(b)(i)
and (ii) of the Declaration)
[Property Trustee]
Attention: Corporate Trust Department
Re: 6 3/4% Trust Convertible Preferred Securities of
TOWER AUTOMOTIVE CAPITAL TRUST (THE "SECURITIES")
Reference is made to the Amended and Restated Declaration of
Trust, dated as of June 9, 1998 (as amended from time to time, the
"Declaration"), among Tower Automotive, Inc. (the "Company"), The First National
Bank of Chicago, First Chicago Delaware, Inc., the Administrative Trustees named
therein and the holders, from time to time, of undivided beneficial interests in
the assets of the Trust. Terms used herein and defined in the Declaration or in
Rule 144 under the U.S. Securities Act of 1933, as amended (the "Securities
Act") are used herein as so defined.
This certificate relates to _________ shares of Securities, which
are evidenced by the following certificate(s) (the "Specified Securities"):
CUSIP No(s).:
-------------------------------------
CERTIFICATE No(s).:
-------------------------------
The Person in whose name this certificate is executed below (the
"Undersigned") hereby certifies that either (i) it is the sole beneficial owner
of the Specified Securities or (ii) it is acting on behalf of all the beneficial
owners of the Specified Securities and is duly authorized by them to do so.
Such beneficial owner or owners are referred to herein collectively as the
"Owner." If the Specified Securities are represented by a Global Certificate,
they are held through the Clearing Agency or participant in the name of the
Undersigned, as or on behalf of the Owner. If the Specified Securities are not
represented by a Global Certificate, they are registered in the name of the
Undersigned, as or on behalf of the Owner.
D-1
<PAGE>
The Owner has requested that the Specified Securities be
transferred to a person (the "Transferee") who will take delivery in the form of
a Restricted Security. In connection with such transfer, the Owner hereby
certifies that, unless such transfer is being effected pursuant to an effective
registration statement under the Securities Act, it is being effected in
accordance with Rule 144A or Rule 144 under the Securities Act and all
applicable securities laws of the states of the United States and other
jurisdictions. Accordingly, the Owner hereby further certifies as follows:
(1) Rule 144A Transfers. If the transfer is being effected in
accordance with Rule 144A:
(A) the Specified Securities are being transferred to a person
that the Owner and any person acting on its behalf reasonably believe is
a "qualified institutional buyer" within the meaning of Rule 144A,
acquiring for its own account or for the account of a qualified
institutional buyer; and
(B) the Owner and any person acting on its behalf have taken
reasonable steps to ensure that the Transferee is aware that the Owner
may be relying on Rule 144A in connection with the transfer; and
(2) Rule 144 Transfers. If the transfer is being effected
pursuant to Rule 144:
(A) the transfer is occurring after a holding period of at
least one year (computed in accordance with paragraph (d) of Rule 144)
has elapsed since the Specified Securities were last acquired from the
Trust or from an affiliate of the Trust, whichever is later, and is being
effected in accordance with the applicable amount, manner of sale, and
notice requirements of rule 144; or
(B) the transfer is occurring after a holding period of at
least two years has elapsed since the Specified Securities were last
acquired from the Trust or from an affiliate of the Trust, whichever is
later, and the Owner is not, and during the preceding three months has
not been, an affiliate of the Trust.
This certificate and the statements contained herein are made for your
benefit and benefit of the Trust and the Purchasers.
Dated:
-------------------------
(Print the name of the Undersigned, as such
term is defined in the second paragraph of
this certificate.)
D-2
<PAGE>
By:
-----------------------------------
Name:
-----------------------------------
Title:
-----------------------------------
(If the Undersigned is a corporation,
partnership or fiduciary, the title of
the person signing on behalf of the
Undersigned must be stated.)
D-3
<PAGE>
EXHIBIT F -- Form of Unrestricted
Securities Certificate
UNRESTRICTED SECURITIES CERTIFICATE
(For removal of Securities Act Legends pursuant to Section 5.4(c))
[Property Trustee]
Attention: Corporate Trust Department
Re: 6 3/4% Trust Convertible Preferred Securities of
TOWER AUTOMOTIVE CAPITAL TRUST (THE "SECURITIES")
Reference is made to the Amended and Restated Declaration of
Trust, dated as of June 9, 1998 (as amended from time to time, the
"Declaration"), among Tower Automotive, Inc. (the "Company"), The First National
Bank of Chicago, First Chicago Delaware, Inc., the Administrative Trustees named
therein and the holders, from time to time, of undivided beneficial interests in
the assets of the Trust. Terms used herein and defined in the Declaration or in
Rule 144 under the U.S. Securities Act of 1933, as amended (the "Securities
Act") are used herein as so defined.
This certificate relates to ________________ shares of Securities,
which are evidenced by the following certificate(s) (the "Specified
Securities"):
CUSIP No(s).:
--------------------------------
CERTIFICATE No(s).:
--------------------------------
The person in whose name this certificate is executed below (the
"Undersigned") hereby certifies that either (i) it is the sole beneficial owner
of the Specified Securities or (ii) it is acting on behalf of all the beneficial
owners of the Specified Securities and is duly authorized by them to do so.
Such beneficial owner or owners are referred to herein collectively as the
"Owner." If the Specified Securities are represented by a Global Certificate,
they are held through the Clearing Agency or participant in the name of the
Undersigned, as or on behalf of the Owner. If the Specified Securities are not
represented by a Global Certificate, they are registered in the name of the
Undersigned as or on behalf of the Owner.
The Owner has requested that the Specified Securities be exchanged
for Securities bearing no Securities Act Legend pursuant to Section 5.4(c) of
the Declaration. In connection with such exchange, the Owner hereby certifies
that the exchange is occurring after a holding period of at least two years
(computed in accordance with paragraph (d) of Rule 144) has elapsed since the
D-1
<PAGE>
Specified Securities were last acquired from the Trust or from an affiliate of
the Trust, whichever is later, and the Owner is not, and during the preceding
three months has not been, an affiliate of the Trust. The Owner also
acknowledges that any future transfers of the Specified Securities must comply
with all applicable securities laws of the states of the United States and other
jurisdictions.
This certificate and the statements contained herein are made for
your benefit and the benefit of the Trust and the Purchasers.
Dated:
--------------------------
(Print the name of the Undersigned, as such
term is defined in the second paragraph of
this certificate.)
By:
--------------------------------
Name:
--------------------------------
Title:
--------------------------------
(If the Undersigned is a corporation,
partnership or fiduciary, the title of
the person signing on behalf of the
Undersigned must be stated.)
D-2
<PAGE>
EXHIBIT G -- Notice of Conversion
NOTICE OF CONVERSION
To: The First National Bank of Chicago,
as Property Trustee of
Tower Automotive Capital Trust
The undersigned owner of these Preferred Securities hereby
irrevocably exercises the option to convert these Preferred Securities, or the
portion below designated, into Common Stock of Tower Automotive, Inc. (the
"Tower Common Stock") in accordance with the terms of the Amended and Restated
Declaration of Trust (as amended from time to time, the "Declaration"), dated
as of June 9, 1998, by Dugald K. Campbell, Anthony A. Barone and James R.
Lozelle, as Administrative Trustees, First Chicago Delaware Inc., as Delaware
Trustee, The First National Bank of Chicago, as Property Trustee, Tower
Automotive, Inc., as Depositor, and by the Holders, from time to time, of
undivided beneficial interests in the assets of the Trust to be issued pursuant
to the Declaration. Pursuant to the aforementioned exercise of the option to
convert these Preferred Securities, the undersigned hereby directs the
Conversion Agent (as that term is defined in the Declaration) to (i) exchange
such Preferred Securities for a portion of the Debentures (as that term is
defined in the Declaration) held by the Trust (at the rate of exchange specified
in the terms of the Preferred Securities set forth in the Declaration) and (ii)
immediately convert such Debentures on behalf of the undersigned, into Tower
Common Stock (at the conversion rate specified in the terms of the Preferred
Securities set forth in the Declaration).
The undersigned does also hereby direct the Conversion Agent that
the shares issuable and deliverable upon conversion, together with any check in
payment for fractional shares, be issued in the name of and delivered to the
undersigned, unless a different name has been indicated in the assignment below.
If shares are to be issued in the name of a person other than the undersigned,
the undersigned will pay all transfer taxes payable with respect thereto.
D-1
<PAGE>
Date: ________________________
in whole _____ in part _____
Number of Preferred Securities to be
converted:
___________________________________________
If a name or names other than the
undersigned, please indicate in the spaces
below the name or names in which the shares
of Tower Common Stock are to be issued, along
with the address or addresses of such person
or persons
___________________________________________
___________________________________________
___________________________________________
___________________________________________
___________________________________________
___________________________________________
___________________________________________
Signature (for conversion only)
Please Print or Typewrite Name and Address,
Including Zip Code, and Social Security or
Other Identifying Number
___________________________________________
___________________________________________
___________________________________________
Signature Guarantee:** ___________________________________________
- -----------------------
(**) (Signature must be guaranteed by an institution which is a
member of the following recognized Signature Guaranty Programs: (i) The
Securities Transfer Agent Medallion Program (STAMP); (ii) The New York Stock
Exchange Medallion Program (MSP); (iii) The Stock Exchange Medallion Program
(SEMP); or (iv) in such other guarantee programs acceptable to the
Trustee.
D-2
<PAGE>
- -------------------------------------------------------------------------------
TOWER AUTOMOTIVE, INC.
to
THE FIRST NATIONAL BANK OF CHICAGO,
as Trustee
------------------------------------------
JUNIOR CONVERTIBLE SUBORDINATED INDENTURE
DATED AS OF JUNE 9, 1998
------------------------------------------
6 3/4% CONVERTIBLE SUBORDINATED DEBENTURES
DUE JUNE 30, 2018
- -------------------------------------------------------------------------------
<PAGE>
Reconciliation and tie between the Trust Indenture Act of 1939 (including
cross-references to provisions of Sections 310 to and including 317 which,
pursuant to Section 318(c) of the Trust Indenture Act of 1939, as amended by the
Trust Reform Act of 1990, are a part of and govern the Junior Convertible
Subordinated Indenture whether or not physically contained therein) and the
Junior Convertible Subordinated Indenture, dated as of June 9, 1998.
<TABLE>
<CAPTION>
TRUST INDENTURE INDENTURE
ACT SECTION SECTION
- --------------- --------
<S> <C>
Section 310(a)(1), (2) and (5). . . . . . . . . . . . . . . . . . . . . . . 6.9
(a)(3) . . . . . . . . . . . . . . . . . . . . . . . . .Not Applicable
(a)(4) . . . . . . . . . . . . . . . . . . . . . . . . .Not Applicable
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.8, 6.10
(c). . . . . . . . . . . . . . . . . . . . . . . . . . .Not Applicable
Section 311(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6.13
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6.13
(b)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7.3(a)
Section 312(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.1
(b). . . . . . . . . . . . . . . . . . . . . . . . . . .7.2(a), 7.2(b)
(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7.2(c)
Section 313(a). . . . . . . . . . . . . . . . . . . . . . . . . .7.3(a), 7.3(b)
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7.3(a)
(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7.3(a)
(d). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7.3(c)
Section 314(a)(1), (2),(3) and (4). . . . . . . . . . . . . . . . . . . . . 7.4
(b). . . . . . . . . . . . . . . . . . . . . . . . . . .Not Applicable
(c)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.2
(c)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.2
(c)(3) . . . . . . . . . . . . . . . . . . . . . . . . .Not Applicable
(d). . . . . . . . . . . . . . . . . . . . . . . . . . .Not Applicable
(e). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.2
(f). . . . . . . . . . . . . . . . . . . . . . . . . . .Not Applicable
Section 315(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6.1(a)
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.2
(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6.1(b)
(d). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6.1(c)
(d)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.1(a)(1)
(d)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.1(c)(2)
(d)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.1(c)(3)
(e). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5.14
Section 316(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5.12
(a)(1)(B). . . . . . . . . . . . . . . . . . . . . . . . . . . . .5.13
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . .Not Applicable
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.8
(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1.4(f)
<PAGE>
Section 317(a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.3
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.4
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10.3
Section 318(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.7
</TABLE>
Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Convertible Subordinated Indenture.
<PAGE>
TABLE OF CONTENTS
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ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.1 DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 1.2 COMPLIANCE CERTIFICATE AND OPINIONS. . . . . . . . . . . .11
SECTION 1.3 FORMS OF DOCUMENTS DELIVERED TO TRUSTEE. . . . . . . . . .12
SECTION 1.4 ACTS OF HOLDERS. . . . . . . . . . . . . . . . . . . . . .12
SECTION 1.5 NOTICES, ETC. TO TRUSTEE AND COMPANY . . . . . . . . . . .13
SECTION 1.6 NOTICE TO HOLDERS; WAIVER. . . . . . . . . . . . . . . . .14
SECTION 1.7 CONFLICT WITH TRUST INDENTURE ACT. . . . . . . . . . . . .14
SECTION 1.8 EFFECT OF HEADINGS AND TABLE OF CONTENTS . . . . . . . . .14
SECTION 1.9 SUCCESSORS AND ASSIGNS . . . . . . . . . . . . . . . . . .14
SECTION 1.10 SEPARABILITY CLAUSE. . . . . . . . . . . . . . . . . . . .14
SECTION 1.11 BENEFITS OF INDENTURE. . . . . . . . . . . . . . . . . . .14
SECTION 1.12 GOVERNING LAW. . . . . . . . . . . . . . . . . . . . . . .14
SECTION 1.13 NON-BUSINESS DAYS. . . . . . . . . . . . . . . . . . . . .15
ARTICLE 2
DEBENTURE FORM
SECTION 2.1 FORMS GENERALLY. . . . . . . . . . . . . . . . . . . . . .15
SECTION 2.2 FORM OF FACE OF DEBENTURE. . . . . . . . . . . . . . . . .15
SECTION 2.3 FORM OF REVERSE OF DEBENTURE . . . . . . . . . . . . . . .16
SECTION 2.4 ADDITIONAL PROVISIONS REQUIRED IN GLOBAL DEBENTURE . . . .26
SECTION 2.5 FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION. . . . . .26
SECTION 2.6 INITIAL ISSUANCE TO PROPERTY TRUSTEE . . . . . . . . . . .26
ARTICLE 3
THE DEBENTURES
SECTION 3.1 AMOUNT OF DEBENTURES . . . . . . . . . . . . . . . . . . .27
SECTION 3.2 DENOMINATIONS. . . . . . . . . . . . . . . . . . . . . . .27
SECTION 3.3 EXECUTION, AUTHENTICATION, DELIVERY AND DATING . . . . . .27
SECTION 3.4 TEMPORARY DEBENTURES . . . . . . . . . . . . . . . . . . .28
SECTION 3.5 REGISTRATION, TRANSFER AND EXCHANGE. . . . . . . . . . . .28
SECTION 3.6 MUTILATED, DESTROYED, LOST AND STOLEN DEBENTURES . . . . .30
SECTION 3.7 PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED . . . . . .31
SECTION 3.8 PERSONS DEEMED OWNERS. . . . . . . . . . . . . . . . . . .32
SECTION 3.9 CANCELLATION . . . . . . . . . . . . . . . . . . . . . . .32
SECTION 3.10 COMPUTATION OF INTEREST. . . . . . . . . . . . . . . . . .32
SECTION 3.11 DEFERRALS OF INTEREST PAYMENT PERIODS. . . . . . . . . . .32
SECTION 3.12 RIGHT OF SET-OFF . . . . . . . . . . . . . . . . . . . . .33
SECTION 3.13 AGREED TAX TREATMENT . . . . . . . . . . . . . . . . . . .33
SECTION 3.14 CUSIP NUMBERS. . . . . . . . . . . . . . . . . . . . . . .34
SECTION 3.15 GLOBAL SECURITY. . . . . . . . . . . . . . . . . . . . . .34
i
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ARTICLE 4
SATISFACTION AND DISCHARGE
SECTION 4.1 SATISFACTION AND DISCHARGE OF INDENTURE. . . . . . . . . .35
SECTION 4.2 APPLICATION OF TRUST MONEY . . . . . . . . . . . . . . . .37
ARTICLE 5
REMEDIES
SECTION 5.1 DEBENTURE EVENTS OF DEFAULT. . . . . . . . . . . . . . . .37
SECTION 5.2 ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT . . . .38
SECTION 5.3 COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
TRUSTEE. . . . . . . . . . . . . . . . . . . . . . . . . .39
SECTION 5.4 TRUSTEE MAY FILE PROOFS OF CLAIM . . . . . . . . . . . . .40
SECTION 5.5 TRUSTEE MAY ENFORCE CLAIM WITHOUT POSSESSION OF
DEBENTURES . . . . . . . . . . . . . . . . . . . . . . . .41
SECTION 5.6 APPLICATION OF MONEY COLLECTED . . . . . . . . . . . . . .41
SECTION 5.7 LIMITATION ON SUITS. . . . . . . . . . . . . . . . . . . .41
SECTION 5.8 UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL,
PREMIUM AND INTEREST . . . . . . . . . . . . . . . . . . .42
SECTION 5.9 RESTORATION OF RIGHTS AND REMEDIES . . . . . . . . . . . .43
SECTION 5.10 RIGHTS AND REMEDIES CUMULATIVE . . . . . . . . . . . . . .43
SECTION 5.11 DELAY OR OMISSION NOT WAIVER . . . . . . . . . . . . . . .43
SECTION 5.12 CONTROL BY HOLDERS . . . . . . . . . . . . . . . . . . . .43
SECTION 5.13 WAIVER OF PAST DEFAULTS. . . . . . . . . . . . . . . . . .44
SECTION 5.14 UNDERTAKING FOR COSTS. . . . . . . . . . . . . . . . . . .45
SECTION 5.15 WAIVER OF USURY, STAY, OR EXTENSION LAWS . . . . . . . . .45
ARTICLE 6
THE TRUSTEE
SECTION 6.1 CERTAIN DUTIES AND RESPONSIBILITIES. . . . . . . . . . . .45
SECTION 6.2 NOTICE OF DEFAULTS . . . . . . . . . . . . . . . . . . . .46
SECTION 6.3 CERTAIN RIGHTS OF TRUSTEE. . . . . . . . . . . . . . . . .47
SECTION 6.4 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF DEBENTURES . .48
SECTION 6.5 MAY HOLD DEBENTURES. . . . . . . . . . . . . . . . . . . .48
SECTION 6.6 MONEY HELD IN TRUST. . . . . . . . . . . . . . . . . . . .48
SECTION 6.7 COMPENSATION AND REIMBURSEMENT . . . . . . . . . . . . . .48
SECTION 6.8 DISQUALIFICATION; CONFLICTING INTERESTS. . . . . . . . . .49
SECTION 6.9 CORPORATE TRUSTEE REQUIRED; ELIGIBILITY. . . . . . . . . .49
SECTION 6.10 RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR. . . . .50
SECTION 6.11 ACCEPTANCE OF APPOINTMENT BY SUCCESSOR . . . . . . . . . .51
SECTION 6.12 MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
BUSINESS . . . . . . . . . . . . . . . . . . . . . . . . .51
SECTION 6.13 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY. . . . .52
SECTION 6.14 APPOINTMENT OF AUTHENTICATING AGENT. . . . . . . . . . . .52
ARTICLE 7
HOLDERS LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 7.1 COMPANY TO FURNISH NAMES AND ADDRESSES OF HOLDERS. . . . .54
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SECTION 7.2 PRESERVATION OF INFORMATION: COMMUNICATIONS TO HOLDERS. .54
SECTION 7.3 REPORTS BY TRUSTEE . . . . . . . . . . . . . . . . . . . .54
SECTION 7.4 REPORTS BY COMPANY . . . . . . . . . . . . . . . . . . . .55
ARTICLE 8
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 8.1 COMPANY MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS . . .55
SECTION 8.2 SUCCESSOR CORPORATION SUBSTITUTED. . . . . . . . . . . . .56
ARTICLE 9
SUPPLEMENTAL INDENTURES
SECTION 9.1 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS . . . .56
SECTION 9.2 SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS. . . . . .57
SECTION 9.3 EXECUTION OF SUPPLEMENTAL INDENTURES . . . . . . . . . . .59
SECTION 9.4 EFFECT OF SUPPLEMENTAL INDENTURES. . . . . . . . . . . . .59
SECTION 9.5 CONFORMITY WITH TRUST INDENTURE ACT. . . . . . . . . . . .59
SECTION 9.6 REFERENCE IN DEBENTURES TO SUPPLEMENTAL INDENTURES . . . .59
ARTICLE 10
COVENANTS
SECTION 10.1 PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST . . . . . . . .59
SECTION 10.2 MAINTENANCE OF OFFICE OR AGENCY. . . . . . . . . . . . . .59
SECTION 10.3 MONEY FOR DEBENTURE PAYMENTS TO BE HELD IN TRUST . . . . .60
SECTION 10.4 PAYMENT OF TAXES AND OTHER CLAIMS. . . . . . . . . . . . .61
SECTION 10.5 STATEMENT AS TO COMPLIANCE . . . . . . . . . . . . . . . .61
SECTION 10.6 WAIVER OF CERTAIN COVENANTS. . . . . . . . . . . . . . . .62
SECTION 10.7 ADDITIONAL SUMS. . . . . . . . . . . . . . . . . . . . . .62
SECTION 10.8 ADDITIONAL COVENANTS . . . . . . . . . . . . . . . . . . .62
SECTION 10.9 PAYMENT OF EXPENSES OF THE TRUST . . . . . . . . . . . . .63
ARTICLE 11
REDEMPTION OR EXCHANGE OF DEBENTURES
SECTION 11.1 ELECTION TO REDEEM; NOTICE TO TRUSTEE. . . . . . . . . . .64
SECTION 11.2 SELECTION OF DEBENTURES TO BE REDEEMED . . . . . . . . . .64
SECTION 11.3 NOTICE OF REDEMPTION . . . . . . . . . . . . . . . . . . .64
SECTION 11.4 DEPOSIT OF REDEMPTION PRICE. . . . . . . . . . . . . . . .65
SECTION 11.5 DEBENTURES PAYABLE ON REDEMPTION DATE. . . . . . . . . . .66
SECTION 11.6 DEBENTURES REDEEMED IN PART. . . . . . . . . . . . . . . .66
SECTION 11.7 MANDATORY REDEMPTION . . . . . . . . . . . . . . . . . . .67
SECTION 11.8 OPTIONAL REDEMPTION. . . . . . . . . . . . . . . . . . . .67
SECTION 11.9 EXCHANGE OF TRUST SECURITIES FOR DEBENTURES. . . . . . . .68
ARTICLE 12
SUBORDINATION OF DEBENTURES
SECTION 12.1 DEBENTURES SUBORDINATE TO SENIOR DEBT. . . . . . . . . . .68
iii
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SECTION 12.2 PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC.. . . . . .69
SECTION 12.3 PRIOR PAYMENT TO SENIOR DEBT UPON ACCELERATION OF
DEBENTURES . . . . . . . . . . . . . . . . . . . . . . . .70
SECTION 12.4 NO PAYMENT WHEN SENIOR DEBT IN DEFAULT . . . . . . . . . .70
SECTION 12.5 PAYMENT PERMITTED IF NO DEFAULT. . . . . . . . . . . . . .71
SECTION 12.6 SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR DEBT. . . . . .71
SECTION 12.7 PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS. . . . . . . .71
SECTION 12.8 TRUSTEE TO EFFECTUATE SUBORDINATION. . . . . . . . . . . .72
SECTION 12.9 NO WAIVER OF SUBORDINATION PROVISIONS. . . . . . . . . . .72
SECTION 12.10 NOTICE TO TRUSTEE. . . . . . . . . . . . . . . . . . . . .72
SECTION 12.11 RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF
LIQUIDATING AGENT. . . . . . . . . . . . . . . . . . . . .72
SECTION 12.12 TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR DEBT . . . . .73
SECTION 12.13 RIGHTS OF TRUSTEE AS HOLDER OF SENIOR DEBT;
PRESERVATION OF TRUSTEE'S RIGHTS . . . . . . . . . . . . .73
SECTION 12.14 ARTICLE APPLICABLE TO PAYING AGENTS. . . . . . . . . . . .73
SECTION 12.15 CERTAIN CONVERSIONS OR EXCHANGES DEEMED PAYMENT. . . . . .73
ARTICLE 13
CONVERSION OF DEBENTURES
SECTION 13.1 CONVERSION RIGHTS. . . . . . . . . . . . . . . . . . . . .73
SECTION 13.2 CONVERSION PROCEDURES. . . . . . . . . . . . . . . . . . .74
SECTION 13.3 EXPIRATION OF CONVERSION RIGHTS. . . . . . . . . . . . . .77
SECTION 13.4 CONVERSION PRICE ADJUSTMENTS . . . . . . . . . . . . . . .77
SECTION 13.5 FUNDAMENTAL CHANGE . . . . . . . . . . . . . . . . . . . .81
SECTION 13.6 NOTICE OF ADJUSTMENTS OF CONVERSION PRICE. . . . . . . . .82
SECTION 13.7 PRIOR NOTICE OF CERTAIN EVENTS . . . . . . . . . . . . . .83
SECTION 13.8 CERTAIN ADDITIONAL RIGHTS. . . . . . . . . . . . . . . . .84
SECTION 13.9 RESTRICTIONS ON COMMON STOCK ISSUABLE UPON CONVERSION. . .84
SECTION 13.10 TRUSTEE NOT RESPONSIBLE FOR DETERMINING CONVERSION
PRICE OR ADJUSTMENTS . . . . . . . . . . . . . . . . . . .85
</TABLE>
iv
<PAGE>
JUNIOR CONVERTIBLE SUBORDINATED INDENTURE, dated as of June 9, 1998
between TOWER AUTOMOTIVE, INC., a Delaware corporation (the "COMPANY") having
its principal office at 6303 28th Street S.E., Grand Rapids, Michigan 49546,
and THE FIRST NATIONAL BANK OF CHICAGO, a national banking association
("FIRST CHICAGO"), as Trustee (the "TRUSTEE").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Subordinated Indenture to provide for the issuance of its 6 3/4% Convertible
Subordinated Debentures (the "DEBENTURES") of substantially the tenor
hereinafter provided which evidence loans made to the Company of the proceeds
from the issuance by Tower Automotive Capital Trust, a Delaware business
trust (the "TRUST"), of preferred trust interests in the Trust (the
"PREFERRED SECURITIES") and common interests in the Trust (the "COMMON
SECURITIES"), and to provide the terms and conditions upon which the
Debentures are to be authenticated, issued and delivered.
All things necessary to make the Debentures, when executed by the
Company and authenticated and delivered hereunder and duly issued by the
Company, the valid obligations of the Company, and to make this Subordinated
Indenture a valid agreement of the Company, in accordance with their and its
terms, have been done.
NOW THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Debentures by the Holders thereof, it is mutually covenanted and agreed, for
the equal and proportionate benefit of all Holders of the Debentures, as
follows:
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.1 DEFINITIONS. For all purposes of this
Subordinated Indenture, except as otherwise expressly provided or unless the
context otherwise requires:
(a) the terms defined in this Article have the meanings assigned
to them in this Article and include the plural as well as the singular;
(b) 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;
(c) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted
accounting principles, and the term "GENERALLY ACCEPTED ACCOUNTING
PRINCIPLES" with respect to any computation required or permitted
hereunder shall mean such accounting principles which are generally
accepted at the date or time of such computation; and
<PAGE>
(d) the words "HEREIN" and "HEREUNDER" and other words of similar
import refer to this Subordinated Indenture as a whole and not to any
particular Article, Section or other subdivision.
"ACT," when used with respect to any Holder, has the meaning specified in
Section 1.4.
"ADDITIONAL INTEREST" means the interest, if any, that shall accrue on
any interest on the Debentures that is in arrears for more than one interest
payment period or not paid during any Extension Period, which in either case
(to the extent permitted by law) shall accrue at the stated rate per annum
specified or determined as specified in such Debenture and compounded
quarterly.
"ADDITIONAL SUMS" has the meaning specified in Section 10.7.
"ADDITIONAL TAXES" means the sum of any additional taxes, duties and
other governmental charges to which the Trust has become subject from time to
time as a result of a Tax Event.
"AFFILIATE" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person; PROVIDED, HOWEVER, that an Affiliate of
the Company shall be deemed not to include the Trust to which Debentures have
been issued. For the purposes of this definition, "CONTROL" when used with
respect to any specified Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise; and the terms
"CONTROLLING" and "CONTROLLED" have meanings correlative to the foregoing.
"APPLICABLE PRICE" means (i) in the case of a Non-Stock Fundamental
Change in which the holders of Common Stock receive only cash, the amount of
cash received by the holder of one share of Common Stock and (ii) in the
event of any other Non-Stock Fundamental Change or any Stock Fundamental
Change, the average of the Closing Prices for Common Stock during the ten
Trading Days prior to and including the record date for the determination of
the holders of Common Stock entitled to receive such securities, cash, or
other property in connection with such Non-Stock Fundamental Change or Stock
Fundamental Change or, if there is no such record date, the date upon which
the holders of Common Stock shall have the right to receive such securities,
cash, or other property (the "Entitlement Date"), in each case as adjusted in
good faith by the Company to appropriately reflect any of the events referred
to in Section 13.4.
"AUTHENTICATING AGENT" means any Person authorized by the Trustee
pursuant to Section 6.14 to act on behalf of the Trustee to authenticate
Debentures.
"BOARD OF DIRECTORS" means either the board of directors of the
Company or any committee of that board duly authorized to act hereunder.
"BOARD RESOLUTION" means a copy of the resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted
by the Board of Directors, or such committee of the Board of Directors or
officers of the Company to which authority to act on behalf of the Board of
Directors has been delegated, and to be in full force and effect on the date
of such certification, and delivered to the Trustee.
2
<PAGE>
"BUSINESS DAY" means any day other than a Saturday or Sunday or a day
on which banking institutions in the City of New York are authorized or
required by law or executive order to remain closed or a day on which the
Corporate Trust Office of the Trustee, or the principal office of the
Property Trustee under the Declaration, is closed for business.
"CLOSING PRICE" means on any day the reported last sale price on such
day or, in case no sale takes place on such day, the average of the reported
closing bid and asked prices in each case on the NYSE Composite Tape or, if
the stock is not traded on the NYSE, on the principal national securities
exchange or quotation system on which such stock is listed or admitted to
trading, or, if not listed or admitted to trading or quoted on any national
securities exchange or quotation system, the average of the closing bid and
asked prices of such stock in the over-the-counter market on the day in
question as reported by the National Quotation Bureau Incorporated, or a
similar generally accepted reporting service, or, if not so available in such
manner, as furnished by the NASD member firm, selected by the Board of
Directors of the Company for that purpose or, if not so available in such
manner, as otherwise determined in good faith by the Board of Directors of
the Company.
"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 instrument such Commission is
not existing and performing the duties now assigned to it under the Trust
Indenture Act, then the body performing such duties on such date.
"COMMON SECURITIES" has the meaning specified in the first recital of
this Subordinated Indenture.
"COMMON STOCK" means the Common Stock, $0.01 par value per share, of
the Company
"COMPANY" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Subordinated Indenture, and
thereafter "Company" shall mean such successor Person.
"COMPANY REQUEST" and "COMPANY ORDER" means, respectively, the written
request or order signed in the name of the Company by its Chairman of the
Board, its Vice Chairman, its President or a Vice President, and by its
Treasurer, an Assistant Treasurer, its Controller, its Secretary or an
Assistant Secretary, and delivered to the Trustee.
"CONVERSION AGENT" has the meaning specified in Section 13.2.
"CONVERSION EXPIRATION DATE" has the meaning specified in Section 13.3.
"CONVERSION DATE" has the meaning specified in Section 13.2.
"CONVERSION PRICE" has the meaning specified in Section 13.1.
"CORPORATE TRUST OFFICE" means the principal office of the Trustee at
which at any particular time its corporate trust business shall be
administered which office at the date hereof is located at One First National
Plaza, Suite 0126, Chicago, Illinois 60670-0126.
3
<PAGE>
"CURRENT MARKET PRICE" means the average of the last reported sale
price, regular way, for the 10 Trading Days (as defined herein) ending on the
date of determination, or, if no sale takes place on any such day, the
average of the reported closing bid and asked prices on such day(s), regular
way, in either case as reported on New York Stock Exchange Composite Tape,
or, if such Common Stock is not listed or admitted to trading on New York
Stock Exchange Composite Tape on any such day, on the principal national
securities exchange or quotation system on which such Common Stock is listed
or admitted to trading, or, if not listed or admitted to trading or quoted on
any national securities exchange or quotation system, the average closing bid
and asked prices of such Common Stock in the over-the-counter market for the
10 Trading Days in question as reported by the National Quotation Bureau
Incorporated, or a similar generally accepted reporting service, or, if not
so available in such manner, as furnished by any member firm of the National
Association of Securities Dealers, Inc. selected from time to time by the
Board of Directors of the Company for that purpose or, if not so available in
such manner, as otherwise determined in good faith by the Board of Directors
of the Company. As used herein, the term "Trading Day" shall mean a day on
which the principal national securities exchange on which the Common Stock is
listed or admitted to trading is open for the transaction of business or, if
the Common Stock is not listed or admitted to trading on any national
securities exchange, a Business Day.
"DEBENTURES" or "DEBENTURE" means any debt securities or debt
security, as the case may be, authenticated and delivered under this
Subordinated Indenture.
"DEBT" means, with respect to any Person, whether recourse is to all
or a portion of the assets of such Person and whether or not contingent, (i)
every obligation of such Person for money borrowed; (ii) every obligation of
such Person evidenced by bonds, debentures, notes or other similar
instruments, including obligations incurred in connection with the
acquisition of property, assets or businesses; (iii) every reimbursement
obligation of such Person with respect to letters of credit, bankers'
acceptances or similar facilities issued for the account of such Person; (iv)
every obligation of such Person issued or assumed as the deferred purchase
price of property or services (but excluding trade accounts payable or
accrued liabilities arising in the ordinary course of business); (v) every
capital lease obligation of such Person; and (vi) every obligation of the
type referred to in clauses (i) through (v) of another Person and all
dividends of another Person the payment of which, in either case, such Person
has guaranteed or is responsible for or liable, directly or indirectly, as
obligor or otherwise.
"DECLARATION" means the Declaration of Trust substantially in the form
attached hereto as Annex A, as amended by the form of Amended and Restated
Declaration of Trust substantially in the form attached hereto as Annex B, as
amended from time to time.
"DEFAULTED INTEREST" has the meaning specified in Section 3.7.
"DEPOSITARY" means, with respect to the Debentures issuable or issued
in whole or in part in the form of one or more Global Debentures, the Person
designated as Depositary by the Company (or any successor thereto).
"DOLLAR" means the currency of the United States of America as at the
time of payment is legal tender for the payment of public and private debts.
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"DEBENTURE EVENTS OF DEFAULT" has the meaning specified in Article 5.
"ENTITLEMENT DATE" has the meaning specified in the definition of
"Applicable Price."
"EXPIRATION TIME" has the meaning specified in Section 13.4(e).
"EXTENSION PERIOD" has the meaning specified in Section 2.3.
"FUNDAMENTAL CHANGE" means the occurrence of any Transaction or event
in connection with a plan pursuant to which all or substantially all of
Common Stock shall be exchanged for, converted into, acquired for, or
constitute solely the right to receive securities, cash, or other property
(whether by means of an exchange offer, liquidation, tender offer,
consolidation, merger, combination, reclassification, recapitalization, or
otherwise); PROVIDED, HOWEVER, in the case of a plan involving more than one
such Transaction or event, for purposes of adjustment of the conversion
price, such Fundamental Change shall be deemed to have occurred when
substantially all of Common Stock shall be exchanged for, converted into, or
acquired for or constitute solely the right to receive securities, cash, or
other property, but the adjustment shall be based upon consideration that a
holder of Common Stock received in such Transaction or event as a result of
which more than 50% of Common Stock shall have been exchanged for, converted
into, or acquired for or constitute solely the right to receive securities,
cash, or other property.
"GLOBAL DEBENTURE" means a Debenture in the form prescribed in Section
2.4 evidencing all or part of the Debentures, issued to the Depositary or its
nominee, and registered in the name of such Depositary or its nominee.
"GUARANTEE" means the guarantee by the Company of distributions on the
Preferred Securities of the Trust to the extent provided in the Guarantee
Agreement, substantially in the form attached hereto as Annex C, as amended
from time to time.
"HOLDER" means a Person in whose name a Debenture is registered in the
Securities Register.
"INITIAL PURCHASERS" with respect to the Preferred Securities, means
Donaldson, Lufkin & Jenrette Securities Corporation, Robert W. Baird & Co.
Incorporated, Merrill Lynch, Pierce, Fenner & Smith Incorporated and
PaineWebber Incorporated.
"INTEREST PAYMENT DATE" means as to the Debentures the Stated Maturity
of an installment of interest on such Debentures.
"INTEREST RATE" means the rate of interest specified or determined as
specified in each Debenture as being the rate of interest payable on such
Debenture.
"INVESTMENT COMPANY EVENT" means, in respect of the Trust, the receipt
by the Property Trustee, on behalf of the Trust of an Opinion of Counsel,
rendered by a law firm having a recognized national tax and securities
practice and experienced in matters under the 1940 Act (which opinion shall
not have been rescinded by such law firm), to the effect that, as a result of
the occurrence of a change in law or regulation or a change in interpretation
or application of law or regulation by any legislative body, court,
governmental agency or regulatory authority (a "CHANGE IN 1940 ACT LAW"),
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there is more than an insubstantial risk that the Trust is or will be within
90 days of the date thereof considered an "investment company" that is
required to be registered under the 1940 Act, which Change in 1940 Act Law
becomes effective on or after the date of original issuance of the Preferred
Securities of the Trust.
"JUNIOR SUBORDINATED PAYMENT" has the meaning specified in Section
12.2.
"LIQUIDATED DAMAGES" has the meaning specified in the form of reverse
of Debenture set forth in Section 2.3
"MATURITY" when used with respect to the Debentures, means the date on
which the principal of the Debentures becomes due and payable as herein
provided, whether at the Stated Maturity or by declaration of acceleration,
call for redemption or otherwise.
"1940 ACT" means the Investment Company Act of 1940, as amended.
"NON BOOK-ENTRY PREFERRED SECURITIES" has the meaning specified in
Section 3.15.
"NON-STOCK FUNDAMENTAL CHANGE" means any Fundamental Change other than
a Stock Fundamental Change.
"NOTICE OF CONVERSION" means the notice given by a Holder of Preferred
Securities to the Conversion Agent directing the Conversion Agent to exchange
such Preferred Securities for Debentures and to convert such Debentures into
Common Stock on behalf of such holder.
"NOTICE OF DEFAULT" has the meaning specified in Section 5.1(c).
"NYSE" means the New York Stock Exchange.
"OFFICERS' CERTIFICATE" means a certificate signed by (i) the
Chairman, Chief Executive Officer, President or a Vice President, and by (ii)
the Treasurer, an Assistant Treasurer, the Controller, the Secretary or an
Assistant Secretary of the Company, and delivered to the Trustee.
"OPINION OF COUNSEL" means a written opinion of counsel, who may be
counsel for the Company, the Trust, or the Trustee, but who may be an
employee thereof, and who shall be reasonably acceptable to the Trustee.
"OUTSTANDING" means, as of the date of determination, all Debentures
theretofore authenticated and delivered under this Subordinated Indenture,
except:
(i) Debentures theretofore canceled by the Trustee or delivered to
the Trustee for cancellation;
(ii) Debentures for whose payment money in the necessary amount
has been theretofore irrevocably deposited with the Trustee or any Paying
Agent in trust for the Holders of such Debentures; and
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(iii) Debentures which have been converted into Common Stock
pursuant to Section 13.1, unless proof satisfactory to the Trustee is
presented that any Debentures are held by Holders in whose hands such
Debentures are valid, binding and legal obligations of the Company;
PROVIDED, HOWEVER, that in determining whether the Holders of the requisite
principal amount of Outstanding Debentures have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Debentures
owned by the Company or any other obligor upon the Debentures or any
Affiliate of the Company or such other obligor shall be disregarded and
deemed not to be outstanding, except that, in determining whether the Trustee
shall be fully protected in conclusively relying upon any such request,
demand, authorization, direction, notice, consent or waiver, only Debentures
which a Responsible Officer of the Trustee actually knows to be so owned
shall be so disregarded. Debentures 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 Debentures and that the pledgee is not the Company or any other obligor
upon the Debentures or any Affiliate of the Company or such other obligor.
Upon request of the Trustee, the Company shall furnish to the Trustee
promptly an Officers' Certificate listing and identifying all Debentures, if
any, known by the Company to be owned or held by or for the account of the
Company, or any other obligor on the Debentures or any Affiliate of the
Company or such obligor, and, subject to the provisions of Section 6.1, the
Trustee shall be entitled to accept such Officers' Certificate as conclusive
evidence of the facts therein set forth and of the fact that all Debentures
not listed therein are Outstanding for the purpose of any such determination.
"PAYING AGENT" means the Trustee or any Person authorized by the
Company to pay the principal of or interest on any Debentures on behalf of
the Company.
"PERSON" means any individual, corporation, partnership, joint
venture, association, joint stock company, trust, unincorporated organization
or government or any agency or political subdivision thereof.
"PREDECESSOR DEBENTURE" of any particular Debenture means every
previous Debenture evidencing all or a portion of the same debt as that
evidenced by such particular Debenture, and, for the purposes of this
definition, any Debenture authenticated and delivered under Section 3.6 in
lieu of a lost, destroyed or stolen Debenture shall be deemed to evidence the
same debt as the lost, destroyed or stolen Debenture.
"PREFERRED SECURITIES" has the meaning specified in the first recital
of this Subordinated Indenture.
"PROCEEDING" has the meaning specified in Section 12.2.
"PROPERTY TRUSTEE" means, in respect of the Trust, the commercial bank
or trust company identified as the "Property Trustee" in the Declaration,
solely in its capacity as Property Trustee of the Trust under the Declaration
and not in its individual capacity, or its successor in interest in such
capacity, or any successor property trustee appointed as therein provided.
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"PURCHASE AGREEMENT" means the Purchase Agreement, dated June 3, 1998,
by and among the Trust, the Company and the Initial Purchasers.
"PURCHASED SHARES" has the meaning specified in Section 13.4(e).
"PURCHASER STOCK PRICE" means, with respect to any Stock Fundamental
Change the average of the Closing Prices for common stock received in such
Stock Fundamental Change for the ten consecutive Trading Days prior to and
including the Entitlement Date, as adjusted in good faith by the Company to
appropriately reflect any of the events referred to in Section 13.4.
"REDEMPTION DATE," when used with respect to any Debenture to be
redeemed, means the date fixed for such redemption by or pursuant to this
Subordinated Indenture.
"REDEMPTION PRICE" has the meaning specified in Section 11.3(b).
"REFERENCE DATE" has the meaning specified in Section 13.4(c).
"REFERENCE MARKET PRICE" initially means $30 1/3 (which is an amount
equal to 66 2/3% of the reported last sale price for Common Stock on June 3,
1998), and in the event of any adjustment of the Conversion Price other than
as a result of a Non-Stock Fundamental Change, the Reference Market Price
shall also be adjusted so that the ratio of the Reference Market Price to the
Conversion Price after giving effect to any such adjustment shall always be
the same as the ratio of the initial Reference Market Price to the initial
Conversion Price of the Debentures.
"REGULAR RECORD DATE" means for the interest payable on any Interest
Payment Date the fifteenth day (whether or not a Business Day) next
preceding such Interest Payment Date.
"RESPONSIBLE OFFICER" when used with respect to the Trustee means any
officer assigned to the Trustee's Corporate Trust Office, including any
managing director, vice president, assistant vice president, assistant
treasurer, assistant secretary or any other officer of the Trustee
customarily performing functions similar to those performed by any of the
above designated officers and having direct responsibility for the
administration of this Subordinated Indenture, and also, with respect to a
particular matter, any other officer, to whom such matter is referred because
of such officer's knowledge of and familiarity with the particular subject.
"RESTRICTED PREFERRED SECURITIES" means all Preferred Securities
required to bear any restricted securities legend pursuant to the Declaration.
"RESTRICTED SECURITIES" means all the Debentures required pursuant to
Section 2.6 to bear a Restricted Securities legend.
"RESTRICTED SECURITIES LEGEND" has the meaning specified in Section
2.6.
"RIGHTS" has the meaning specified in Section 13.2(g).
"SECURITIES REGISTER" AND "SECURITIES REGISTRAR" have the respective
meanings specified in Section 3.5.
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"SENIOR DEBT" means the principal of (and premium, if any) and
interest, if any (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to the Company whether
or not such claim for post-petition interest is allowed in such proceeding),
on Debt of the Company, whether incurred on or prior to the date of this
Subordinated Indenture or thereafter incurred, unless, in the instrument
creating or evidencing the same or pursuant to which the same is outstanding,
it is provided that such obligations are not superior in right of payment to
the Debentures or to other Debt which is PARI PASSU with, or subordinated to,
the Debentures, PROVIDED, HOWEVER, that Senior Debt shall not be deemed to
include (a) any Debt of the Company which when incurred and, without respect
to any election under Section 1111(b) of the Bankruptcy Reform Act of 1978,
was without recourse to the Company, (b) any Debt of the Company to any of
its Subsidiaries, (c) Debt to any employee of the Company, (d) any liability
for taxes, (e) Debt or other monetary obligations to trade creditors created
or assumed by the Company or any of its Subsidiaries in the ordinary course
of business in connection with the obtaining of goods, materials or services
and (f) the Debentures.
"SPECIAL EVENT" means a Tax Event or an Investment Company Event.
"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 the Debentures or any
installment of principal thereof or interest thereon means the date specified
in the Debentures as the fixed date on which the principal of the Debentures
or such installment of interest is due and payable.
"STOCK FUNDAMENTAL CHANGE" means either (i) any Fundamental Change
that is a holding company reorganization (whether effected in accordance with
Section 251(g) of the Delaware General Corporation Law or otherwise) provided
that immediately after such Fundamental Change the Common Stock of the
holding company in such Transaction is admitted for listing on a national
securities exchange or for quotation on the Nasdaq National Market or (ii)
any Fundamental Change in which more than 50% of the value (as determined in
good faith by the Board of Directors in a Board Resolution) of the
consideration received by holders of Common Stock consists of Common Stock
that for each of the 10 consecutive Trading Days prior to the Entitlement
Date has been admitted for listing or admitted for listing subject to notice
of issuance on a national securities exchange or quoted on the Nasdaq
National Market; PROVIDED, HOWEVER, that a Fundamental Change that is not a
holding company reorganization described in clause (i) above shall not be a
Stock Fundamental Change if either (a) the Company continues to exist after
the occurrence of such Fundamental Change and the outstanding Preferred
Securities continue to exist as outstanding Preferred Securities or (b) not
later than the occurrence of such Fundamental Change, the outstanding
Preferred Securities are converted into or exchanged for shares of
convertible preferred stock of an entity succeeding to the business of the
Company or a subsidiary thereof, which convertible preferred stock has
powers, preferences, and relative, participating, optional, or other rights,
and qualifications, limitations, and restrictions, substantially similar to
those of the Preferred Securities.
"SUBORDINATED 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 the terms of the Debentures.
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"SUBSIDIARY" means any corporation of which at the time of
determination the Company and/or one or more Subsidiaries owns or controls
directly or indirectly more than 50% of the outstanding shares of voting
stock. For purposes of this definition, "VOTING STOCK" means stock which has
voting power for the election of directors, whether at all times or only so
long as no senior class of stock has such voting power by reason of any
contingency.
"TAX ACTION" means any amendment to, or change (including any
announced prospective change) in, the laws (or any regulations thereunder) of
the United States or any political subdivision or taxing authority thereof or
therein affecting taxation, or as a result of any official administrative
pronouncement or judicial decision interpreting or applying such laws or
regulations, which amendment or change is effective or such pronouncement or
decision is announced on or after the date of the original issuance of the
Preferred Securities.
"TAX EVENT" means that the Company shall have requested and received
and shall have delivered to the Property Trustee an Opinion of Counsel (as
defined in the Declaration) from a firm having a national tax and securities
practice (which Opinion of Counsel shall not have been rescinded by such law
firm) that there has been a Tax Action which relates to any of the items
described in (i) through (iii) below, and that there is more than an
insubstantial risk that (i) the Trust is or, within 90 days after such date,
will be subject to United States federal income tax with respect to income
accrued or received on the Debentures, (ii) the Trust is or, within 90 days
after such date, will be subject to more than a de minimis amount of other
taxes, duties, assessments or other governmental charges or (iii) interest
payable by the Company on the Debentures is not or, within 90 days after such
date, will not be deductible, in whole or in part, by the Company for United
States federal income tax purposes.
"TRANSACTION" has the meaning specified in Section 13.5(a).
"TRADING DAYS" means a Monday, Tuesday, Wednesday, Thursday and
Friday, other than any day on which securities are not traded on the
applicable securities exchange in the applicable securities market.
"TRUST" has the meaning specified in the first recital of this
Subordinated Indenture.
"TRUSTEE" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Subordinated Indenture, and
thereafter "Trustee" shall mean or include each Person who is then a Trustee
hereunder if at any time there is more than one such Person.
"TRUST INDENTURE ACT" means the Trust Indenture Act of 1939 (15
U.S.C.Sections 77aaa-77bbb), as amended and as in effect on the date as of
this Subordinated Indenture.
"TRUST SECURITIES" means the Common Securities and Preferred
Securities.
"VICE PRESIDENT" when used with respect to the Company or the
Trustees, means any vice president, whether or not designated by a number or
a word or words added before or after the title "VICE PRESIDENT."
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SECTION 1.2 COMPLIANCE CERTIFICATE AND OPINIONS. Upon any
application or request by the Company to the Trustee to take any action under
any provision of this Subordinated Indenture, the Company shall furnish to
the Trustee an Officers' Certificate stating that all conditions precedent
(including covenants, compliance with which constitutes a condition
precedent), if any, provided for in this Subordinated Indenture relating to
the proposed action have been complied with and an Opinion of Counsel stating
that in the opinion of such counsel all such conditions precedent (including
covenants compliance with which constitute a condition precedent), if any,
have been complied with, except that in the case of any such application or
request as to which the furnishing of such documents is specifically required
by any provision of this Subordinated 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 Subordinated Indenture (other than
the certificates provided pursuant to Section 10.5) shall include:
(a) a statement that each individual signing such
certificate or opinion has read such covenant or condition and the
definitions herein relating thereto;
(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(c) a statement that, in the opinion of each such
individual, he has made such examination or investigation as is
necessary to enable him to express an informed opinion as to whether
or not such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
SECTION 1.3 FORMS 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 matters upon which his certificate or opinion
is based are erroneous. Any such certificate or Opinion of Counsel may be
based, insofar as it relates to factual matters, upon a certificate or
opinion of, or representations by, an officer or officers of the Company
stating that the information with respect to such factual matters is in the
possession of the Company, unless such counsel knows, or in the exercise of
reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous. Where any Person
is required to make, give or execute two or more applications, requests,
consents, certificates, statements, opinions or other instruments under this
Subordinated Indenture, they may, but need not, be consolidated and form one
instrument.
SECTION 1.4 ACTS OF HOLDERS.
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(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Subordinated
Indenture to be given to 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 an agent duly appointed in
writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments is
or 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 Subordinated Indenture and (subject to Section 6.1) conclusive
in favor of the Trustee and the Company and any agent of the Trustee
or 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 the certificate of any 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 Person acting
in other than his individual capacity, such certificate or affidavit
shall also constitute sufficient proof of his authority.
(c) The fact and date of the execution by any Person 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 and in accordance with such reasonable rules as the
Trustee may determine.
(d) The ownership of Debentures shall be proved by the
Securities Register.
(e) Any request, demand, authorization, direction, notice,
consent, waiver or other action by the Holder of any Debenture shall
bind every future Holder of the same Debenture and the Holder of every
Debenture issued upon the transfer thereof or in exchange therefor or
in lieu thereof in respect of anything done 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 Debenture.
(f) The Company may, but shall not be obligated to, fix a
record date for the purpose of determining the Holders entitled to
take any action under this Subordinated Indenture by vote or consent.
Except as otherwise provided herein, such record date shall be the
later of 30 days prior to the first solicitation of such consent or
vote or the date of the most recent list of Holders furnished to the
Trustee pursuant to Section 7.1 prior to such solicitation. If a
record date is fixed, those persons who were Holders at such record
date (or their duly designated proxies), and only those persons, shall
be entitled to take such action by vote or consent or to revoke any
vote or consent previously given, whether or not such persons continue
to be Holders after such record date.
(g) Without limiting the foregoing, a Holder entitled
hereunder to give or take any such action with regard to any
particular Debenture may do so with regard to all or any part of the
principal amount of such Debenture or by one or more duly appointed
agents each of
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which may do so pursuant to such appointment with regard to all or any
different part of such principal amount.
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 Subordinated
Indenture to be made upon, given or furnished to, or filed with
(a) 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, or
(b) the Company by the Trustee or by any Holder shall be
sufficient for every purpose (except as otherwise provided in Section 5.1
hereof) hereunder if in writing and mailed, first class, postage prepaid,
to the Company addressed to it at the address of its principal office
specified in the first paragraph of this instrument or at any other
address previously furnished in writing to the Trustee by the Company.
SECTION 1.6 NOTICE TO HOLDERS; WAIVER. Where this
Subordinated Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly
provided) if in writing and mailed, first class postage prepaid, to each
Holder affected by such event, at the address of such Holder as it appears in
the Securities Register on the date such notice is mailed, which shall be not
later than the latest date, and not earlier than the earliest date,
prescribed for the giving of such notice. In any case where notice to Holders
is given by mail, neither the failure to mail such notice, nor any defect in
any notice so mailed, to any particular Holder shall affect the sufficiency
of such notice with respect to other Holders. Where this Subordinated
Indenture provides for notice in any manner, such notice may be waived in
writing by the Person entitled to receive such notice, either before or after
the event, and such waiver shall be the equivalent of such notice. Waivers
of notice by Holders shall be filed with the Trustee, but such filing shall
not be a condition precedent to the validity of any action taken in reliance
upon such waiver. In case by reason of the suspension of regular mail
service or by reason of any other cause it shall be impracticable to give
such notice by mail, then such notification as shall be made with the
approval of the Trustee shall constitute a sufficient notification for every
purpose hereunder.
SECTION 1.7 CONFLICT WITH TRUST INDENTURE ACT. If any
provision of this Subordinated Indenture limits, qualifies or conflicts with
a provision of the Trust Indenture Act that is required under such act to be
a part of and govern this Subordinated Indenture, the latter provision shall
control. If any provision of this Subordinated Indenture modifies or
excludes any provision of the Trust Indenture Act that may be so modified or
excluded, the former provision shall be deemed to apply.
SECTION 1.8 EFFECT OF HEADINGS AND TABLE OF CONTENTS. The
Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
SECTION 1.9 SUCCESSORS AND ASSIGNS. All covenants and
agreements in this Subordinated Indenture by the Company shall bind its
successors and assigns, whether so expressed or not.
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SECTION 1.10 SEPARABILITY CLAUSE. In case any provision in
this Subordinated Indenture or in the Debentures shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
SECTION 1.11 BENEFITS OF INDENTURE. Nothing in this
Subordinated Indenture or in the Debentures, express or implied, shall give
to any Person, other than the parties thereto, any Paying Agent and their
successors and assigns and the Holders of the Debentures, any benefit or any
legal or equitable right, remedy or claim under this Subordinated Indenture.
SECTION 1.12 GOVERNING LAW. This Subordinated Indenture and
the Debentures shall be governed by and construed in accordance with the laws
of the State of Illinois without regard to its principles of conflicts of
laws.
SECTION 1.13 NON-BUSINESS DAYS. In any case where any
Interest Payment Date, Redemption Date, or Stated Maturity of any Debenture
shall not be a Business Day, then (notwithstanding any other provision of
this Subordinated Indenture or the Debentures) payment of interest or
principal payable on such date will be made on the next succeeding day that
is a Business Day (and without any interest or other payment in respect of
any such delay) with the same force and effect as if made on the Interest
Payment Date or Redemption Date or at the Stated Maturity, PROVIDED, HOWEVER,
that no interest shall accrue for the period from and after such Interest
Payment Date or Redemption Date or Stated Maturity.
ARTICLE 2
DEBENTURE FORM
SECTION 2.1 FORMS GENERALLY. The Debentures and the
Trustee's certificate of authentication shall be in substantially the forms
sets forth in this Article 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 applicable tax laws or the rules of any securities
exchange or as may, consistently herewith, be determined by the officers
executing such Debentures, as evidenced by their execution of the Debentures.
The definitive Debentures shall be typewritten, printed, lithographed
or engraved or produced by any combination of these methods, if required by
any securities exchange on which the Debentures may be listed, on a steel
engraved border or steel engraved borders or may be produced in any other
manner permitted by the rules of any securities exchange on which the
Debentures may be listed, all as determined by the officers executing such
Debentures, as evidenced by their execution of such Debentures.
SECTION 2.2 FORM OF FACE OF DEBENTURE.
6 3/4% Convertible Subordinated Debenture due June 30, 2018
No. 1 $
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Tower Automotive, Inc., a corporation organized and existing under the
laws of Delaware (the "COMPANY," which term includes any successor
corporation under the Subordinated Indenture hereinafter referred to), for
value received, hereby promises to pay to _____________________, or
registered assigns, the principal sum of ________________________________ on
June 30, 2018 and to pay interest on said principal sum from June 9, 1998 or
from the most recent interest payment date (each such date, an "INTEREST
PAYMENT DATE") on which interest has been paid or duly provided for,
quarterly plus Additional Interest, if any until the principal hereof is paid
or duly provided for or made available for payment subject to deferral as set
forth herein in arrears on March 31, June 30, September 30 and December 31 of
each year, commencing September 30, 1998 at the rate of 63/4% per annum,
until the principal hereof shall have become due and payable.
Reference is hereby made to the further provisions of this Debenture
set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this
Debenture shall not be entitled to any benefit under the Subordinated
Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
Dated:
By:
----------------------------------
SECTION 2.3 FORM OF REVERSE OF DEBENTURE. This Debenture
is one of a duly authorized issue of Debentures of the Company (the
"DEBENTURES") limited to the aggregate principal amount of $266,752,600,
issued and to be issued under a Junior Convertible Subordinated Indenture,
dated as of June 9, 1998 (the "SUBORDINATED INDENTURE"), between the Company
and The First National Bank of Chicago, as Trustee (herein called the
"TRUSTEE," which term includes any successor trustee under the Subordinated
Indenture), to which the Subordinated Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the
respective rights, limitations of rights, duties and immunities thereunder of
the Trustee, the Company and the Holders of the Debentures, and of the terms
upon which the Debentures are, and are to be, authenticated and delivered.
All terms used in this Debenture that are defined in the Subordinated
Indenture shall have the meanings assigned to them in the Subordinated
Indenture.
The amount of interest payable for any period will be computed on the
basis of a 360-day year of twelve 30-day months. For periods less than a
full month, interest shall be computed on the actual number of elapsed days
over 360 days. In the event that any date on which interest is payable on
this Debenture is not a Business Day, then payment of the interest on such
date will be made on the next succeeding day which is a Business Day (and
without any interest or other payment in respect of any such delay), except
that if such Business Day is in the next succeeding calendar year,
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<PAGE>
then such payment shall be made on the immediately preceding Business Day, in
each case with the same force and effect as if made on the date the payment
was originally payable. The interest installment so payable, and punctually
paid or duly provided for, on any Interest Payment Date will, as provided in
the Subordinated Indenture, be paid to the Person in whose name this
Debenture (or one or more Predecessor Debentures, as defined in the
Subordinated Indenture) is registered at the close of business on the Regular
Record Date, for such interest installment which shall be the date which is
the Business Day next preceding such Interest Payment Date. Any such
interest installment not so punctually paid or duly provided for shall
forthwith cease to be payable to the Holder on such Regular Record Date and
may either be paid to the Person in whose name this Debenture (or one or more
Predecessor Debentures) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Debentures not less than
10 days prior to such Special Record Date, or be paid at any time in any
other lawful manner not inconsistent with the requirements of any securities
exchange on which the Debentures may be listed, and upon such notice as may
be required by such exchange, all as more fully provided in the Subordinated
Indenture.
The Company shall have the right at any time during the term of this
Debenture, from time to time, to extend the interest payment period of such
Debenture for up to 20 consecutive quarters with respect to each deferral
period (each such deferral period, an "EXTENSION PERIOD"), during which
periods the Company shall have the right not to make payments of interest on
any Interest Payment Date, and at the end of which the Company shall pay all
interest then accrued and unpaid (together with Additional Interest, if any,
thereon to the extent permitted by applicable law); PROVIDED that during any
such Extension Period, the Company will not, and will not permit any
Subsidiary to (a) (i) declare or pay dividends on, make distributions with
respect to, or redeem, purchase or acquire, or make a liquidation payment
with respect to any of its Capital Stock (except for (x) dividends or
distributions in shares of, or options, warrants or rights to subscribe for
or purchase shares of its Capital Stock and conversions or exchanges of
Common Stock of one class for Common Stock of another class and (y)
redemptions or purchases of any rights pursuant to rights agreement and the
issuance of Capital Stock pursuant to such rights) or (ii) make any payments
of principal, interest or premium, if any, on or repay or repurchase or
redeem any debt securities (including guarantees of indebtedness for money
borrowed) of the Company that rank PARI PASSU with or junior to the
Debentures (other than (u) any redemption, liquidation, interest, principal
or guarantee payment by the Company where the payment is made by way of
securities (including Capital Stock) that rank PARI PASSU with or junior to
the securities on which such redemption, interest, principal or guarantee
payment is being made, (v) payments under the Guarantee (as defined in the
Declaration) or the Common Securities Guarantee (as defined in the
Declaration), (w) purchases of Common Stock related to the issuance of Common
Stock under any of the Company's benefit plans for its directors, officers or
employees, (x) as a result of a reclassification of the Company's Capital
Stock or the exchange or conversion of one series or class of the Company's
Capital Stock for another series or class of the Company's Capital Stock, (y)
the purchase of fractional interests in shares of the Company's Capital Stock
pursuant to the conversion or exchange provisions of such Capital Stock or
the security being converted or exchanged and (z) redemptions or purchases of
any rights pursuant to a rights agreement and the issuance of Capital Stock
pursuant to such rights). Prior to the termination of any such Extension
Period, the Company may further extend the interest payment period, PROVIDED
that no Extension Period shall exceed 20 consecutive quarters or extend
beyond the Stated Maturity of this Debenture. Upon the termination of any
such Extension Period and upon the payment of all accrued and unpaid interest
and any Additional Interest then due, the Company
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<PAGE>
may elect to begin a new Extension Period, subject to the above requirements.
No interest shall be due and payable during an Extension Period except at the
end thereof. The Company shall give the Trustee, the Property Trustee and
the Administrative Trustees notice of its selection of an Extension Period at
least one Business Day prior to the earlier of (i) the record date for the
date the distributions on the Preferred Securities (or if no Preferred
Securities are outstanding, for the date interest on the Debentures) would
have been payable except for the election to begin such Extension Period or
(ii) the date the Property Trustee of the Tower Automotive Capital Trust is
(or if no Preferred Securities are outstanding, the Debenture Trustee is)
required to give notice to NYSE or other applicable self-regulatory
organizations or to holders of such Preferred Securities (or, if no Preferred
Securities are outstanding, to the Holders of such Debentures) of the record
date.
Payment of the principal of (and premium, if any) and interest on this
Debenture will be made to the Holders in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private debts PROVIDED, HOWEVER, that at the option of the Company
payment of interest may be made (a) by check mailed to the address of the
Person entitled thereto as such address shall appear in the Securities
Register or (b) by wire transfer in immediately available funds at such place
and to such account as may be designated by the Person entitled thereto as
specified in the Securities Register.
The indebtedness evidenced by this Debenture is, to the extent
provided in the Subordinated Indenture, subordinate and subject in right of
payments to the prior payment in full of all Senior Debt (as defined in the
Subordinated Indenture), and this Debenture is issued subject to the
provisions of the Subordinated Indenture with respect thereto. Each Holder
of this Debenture, by accepting the same, (a) agrees to and shall be bound by
such provisions, (b) authorizes and directs the Trustee on his behalf to take
such actions as may be necessary or appropriate to effectuate the
subordination so provided and (c) appoints the Trustee his attorney-in-fact
for any and all such purposes. Each Holder hereof, by his acceptance hereof,
waives all notice of the acceptance of the subordination provisions contained
herein and in the Subordinated Indenture by each holder of Senior Debt,
whether now outstanding or hereafter incurred, and waives reliance by each
such holder upon said provisions.
At any time on or after June 30, 2001, the Company may, at its option,
subject to the terms and conditions of Article 11 of the Subordinated
Indenture, redeem this Debenture in whole at any time or in part from time to
time, at the Redemption Prices set forth in Section 11.8 of the Subordinated
Indenture.
In the event of redemption of this Debenture in part only, a new
Debenture or Debentures for the unredeemed portion hereof will be issued in
the name of the Holder hereof upon the cancellation hereof.
If a Special Event shall occur and be continuing, this Debenture shall
be exchangeable for Preferred Securities in accordance with Section 11.9 of
the Subordinated Indenture or, in certain circumstances, redeemable by the
Company in accordance with Section 11.8 of the Subordinated Indenture.
Subject to the terms and conditions set forth in Article 13 of the
Subordinated Indenture, this Debenture is convertible, at the option of the
Holder, hereof into shares of Common Stock.
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<PAGE>
If a Debenture Event of Default shall occur and be continuing, the
principal of the Debentures may be declared due and payable in the manner,
with the effect and subject to the conditions provided in the Subordinated
Indenture.
The Subordinated Indenture contains provisions for satisfaction,
discharge and defeasance of the entire indebtedness of this Debenture upon
compliance by the Company with certain conditions set forth in the
Subordinated Indenture.
The Subordinated Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Debentures to
be affected under the Subordinated Indenture at any time by the Company and
the Trustee with the consent of the Holders of a majority in principal amount
of the Debentures. The Subordinated Indenture also contains provisions
permitting Holders of specified percentages in principal amount of the
Debentures at the time Outstanding, on behalf of the Holders of all
Debentures, to waive compliance by the Company with certain provisions of the
Subordinated Indenture and certain past defaults under the Subordinated
Indenture and their consequences. Any such consent or waiver shall be
conclusive and binding upon the Holder of this Debenture and upon all future
Holders of this Debenture and of any Debenture issued upon the registration
of transfer hereof or in exchange therefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Debenture.
As provided in and subject to the provisions of the Subordinated
Indenture, if a Debenture Event of Default shall occur and be continuing,
then and in every such case the Trustee or the Holders of not less than 25%
in principal amount of the Outstanding Debentures may declare the principal
amount of all the Debentures to be due and payable immediately, by a notice
in writing to the Company (and to the Trustee if given by Holders), PROVIDED
that, if a Debenture Event of Default shall occur and be continuing, the
Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Debentures fail to declare the principal of all the Debentures to
be immediately due and payable, the holders of at least 25% in aggregate
liquidation amount of the Preferred Securities then outstanding shall have
such right by a notice in writing to the Company and the Trustee; and upon
any such declaration such principal amount (or specified amount) of and the
accrued interest (including any Additional Interest) on all the Debentures
shall become immediately due and payable, PROVIDED that the payment of
principal and interest (including any Additional Interest) on such Debentures
shall remain subordinated to the extent provided in Article 12 of the
Subordinated Indenture.
The holders of the Preferred Securities, the Debentures issuable in
respect of the Preferred Securities, the shares of Company Common Stock
issuable upon conversion of the Preferred Securities and the Debentures, and
the Guarantee (collectively, the "REGISTRABLE SECURITIES") are entitled to
the benefits of a Registration Rights Agreement, dated as of June 9, 1998,
among Tower Automotive Capital Trust, the Company and the Initial Purchasers
(the "REGISTRATION RIGHTS AGREEMENT"). Pursuant to the Registration Rights
Agreement, the Company has agreed for the benefit of the holders of
Registrable Securities that (i) it will, at its cost, use its best efforts
within 90 days after the date of original issuance of the Registrable
Securities, to file a shelf registration statement (the "SHELF REGISTRATION
STATEMENT") with the Commission with respect to the resales of the
Registrable Securities, (ii) it will use its best efforts to cause such Shelf
Registration Statement to be declared effective by the Commission within 150
days after the date of issuance of the
18
<PAGE>
Registrable Securities and (iii) it will use its best efforts to maintain
such Shelf Registration Statement continuously effective under the Securities
Act until two years after the date of original issuance of the Preferred
Securities (or such earlier date as the holders of Registrable Securities are
able to sell all Registrable Securities immediately without restriction,
whether pursuant to Rule 144(k) under the Securities Act or any successor
rule thereto or otherwise) (the "EFFECTIVENESS PERIOD"). The Trust and the
Company will be permitted to suspend the use of the prospectus (which is a
part of the Shelf Registration Statement) in connection with sales of
Registrable Securities by holders during certain periods of time under
certain circumstances relating to pending corporate developments relating to
the Company and public filings with the Commission and similar events.
If (i) on or prior to 90 days following the date of original issuance
of the Registrable Securities, a Shelf Registration Statement has not been
filed with the Commission, or (ii) on or prior to the 150th day following the
original issuance of the Registrable Securities, such Shelf Registration
Statement has not been declared effective (each such event a "REGISTRATION
DEFAULT"), additional interest ("LIQUIDATED DAMAGES") will accrue on the
Debentures and, accordingly, additional distributions will accrue on the
Preferred Securities, from and including the day following such Registration
Default until such time as such Shelf Registration Statement is filed or such
Shelf Registration Statement is declared effective, as the case may be.
Liquidated Damages will be paid quarterly in arrears (subject to the
Company's ability to defer payment of Liquidated Damages during any Extension
Period), with the first quarterly payment due on the first Interest Payment
Date following the date on which such Liquidated Damages begin to accrue, and
will accrue at a rate per annum equal to an additional 0.25% of the principal
amount or liquidation amount, as applicable, to and including the 90th day
following such Registration Default and 0.50% thereof from and after the 91st
day following such Registration Default. In the event that during the
Effectiveness Period the Shelf Registration Statement ceases to be effective
for more than 90 days, whether or not consecutive, during any 12-month period
then the interest rate borne by the Debentures and the distribution rate
borne by the Preferred Securities will each increase by an additional 0.50%
per annum from the 91st day of the applicable 12-month period such Shelf
Registration Statement ceases to be effective until the earlier of such time
as (i) the Shelf Registration Statement again becomes effective or (ii) the
Effectiveness Period expires.
No reference herein to the Subordinated Indenture and no provision of
this Debenture or of the Subordinated Indenture shall alter or impair the
obligation of the Company, which is absolute and unconditional, to pay the
principal of (and premium, if any) and interest on this Debenture at the
times, place and rate, and in the coin or currency, herein prescribed.
As provided in the Subordinated Indenture and subject to certain
limitations therein set forth, the transfer of this Debenture is registrable
in the Securities Register, upon surrender of this Debenture for registration
of transfer at the office or agency of the Company maintained under Section
10.2 of the Subordinated Indenture duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Securities Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Debentures, of
authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees. No service charge shall
be made for any such registration of transfer or exchange, but the Company
may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith.
19
<PAGE>
Prior to due presentment of this Debenture for registration of
transfer, the Company, the Trustee and any agent of the Company or the
Trustee may treat the Person in whose name this Debenture is registered as
the owner hereof for all purposes, whether or not this Debenture be overdue,
and neither the Company, the Trustee nor any such agent shall be affected by
notice to the contrary.
The Debentures are issuable only in registered form without coupons in
denominations of $50 and any integral multiple thereof. As provided in the
Subordinated Indenture and subject to certain limitations therein set forth,
Debentures are exchangeable for a like aggregate principal amount of
Debentures of a different authorized denomination, as requested by the Holder
surrendering the same.
The Company and, by its acceptance of this Debenture or a beneficial
interest therein, the Holder of, and any Person that acquires a beneficial
interest in, this Debenture agree that for United States Federal, state and
local tax purposes it is intended that this Debenture constitute indebtedness.
THE SUBORDINATED INDENTURE AND THIS DEBENTURE SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS WITHOUT REGARD
TO CONFLICTS OF LAW PRINCIPLES THEREOF.
20
<PAGE>
ASSIGNMENT FORM
To assign this Debenture, fill in the form below:
(i) or (we) assign and transfer this Security to
- --------------------------------------------------------------------------------
(Insert assignee's social security or tax I.D. no.)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint_________________________________________________________
agent to transfer this Debenture on the books of the Company. The agent may
substitute another to act for him.
Your Signature:
-----------------------------------------------------
(Sign exactly as your name appears on the other
side of this Security)
Date:
---------------------------------
Signature Guarantee:*
--------------------------------------------
[Include the following if the Debenture bears a Restricted Securities Legend --
In connection with any transfer of any of the Debentures evidenced by this
certificate, the undersigned confirms that such Debentures are being:
CHECK ONE BOX BELOW
(1) / / exchanged for the undersigned's own account without
transfer; or
- ------------------
* Signature must be guaranteed by an institution which is a member of one of
the following recognized Signature Guaranty Programs: (i) The Securities
Transfer Agent Medallion Program (STAMP); (ii) The New York Stock Exchange
Medallion Program (MSP); (iii) The Stock Exchange Medallion Program (SEMP);
or (iv) in such other guarantee programs acceptable to the Trustee.
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<PAGE>
(2) / / transferred pursuant to and in compliance with Rule 144A
under the Securities Act of 1933; or
(3) / / transferred pursuant to another available exemption from
the registration requirements of the Securities Act of
1933; or
(4) / / transferred pursuant to an effective Registration Statement
under the Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register any
of the Debentures evidenced by this certificate in the name of any person
other than the registered Holder thereof; PROVIDED, HOWEVER, that if box (3)
is checked, the Trustee may require, prior to registering any such transfer
of the Securities such legal opinions, certifications and other information
as the Company has reasonably requested in writing and directed the Trustee
to require confirmation that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act of 1933, such as the exemption provided by
Rule 144 under such Act; PROVIDED, FURTHER, that after the date that a shelf
Registration Statement under the Securities Act of 1933 has been filed and so
long as such shelf Registration Statement continues to be effective, the
Trustee may only permit transfers for which box (4) has been checked.
----------------------------
Signature
Signature Guarantee:*
- -------------------------------- ----------------------------
Signature must be guaranteed Signature
- --------------------------------------------------------------------------------
Dated:
------------------------- --------------------------------------
NOTICE: To be executed by an executive
officer
[TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED.
- ------------------
* Signature must be guaranteed by an institution which is a member of one of
the following recognized Signature Guaranty Programs: (i) The Securities
Transfer Agent Medallion Program (STAMP); (ii) The New York Stock Exchange
Medallion Program (MSP); (iii) The Stock Exchange Medallion Program (SEMP);
or (iv) in such other guarantee programs acceptable to the Trustee.
22
<PAGE>
The undersigned represents and warrants that it is purchasing
this Debenture for its own account or an account with respect to which it
exercises sole investment discretion and that it and any such account is a
"qualified institutional buyer" within the meaning of Rule 144A under the
Securities Act of 1933, and is aware that the sale to it is being made in
reliance on Rule 144A and acknowledges that it has received such information
regarding the Company as the undersigned has requested pursuant to Rule 144A
or has determined not to request such information and that it is aware that
the transferor is relying upon the undersigned's foregoing representations in
order to claim the exemption from registration provided by Rule 144A.
Dated:
------------------------ --------------------------------------
NOTICE: To be executed by an executive
officer]
23
<PAGE>
NOTICE OF CONVERSION
To: Tower Automotive, Inc.
The undersigned owner of this Debenture hereby irrevocably
exercises the option to convert this Debenture, or the portion below
designated, into Common Stock of Tower Automotive, Inc. in accordance with
the terms of the Subordinated Indenture referred to in this Debenture, and
directs that the shares issuable and deliverable upon conversion, together
with any check in payment for fractional shares, be issued in the name of and
delivered to the undersigned, unless a different name has been indicated in
the assignment below. If shares are to be issued in the name of a person
other than the undersigned, the undersigned will pay all transfer taxes
payable with respect thereto.
Date: ____________, ____
in whole __
Portions of Debenture to be converted
in part __ ($50 or integral multiples thereof):
$_________________
_____________________________________________
Signature (for conversion only)
Please Print or Typewrite Name and
Address, Including Zip Code, and Social
Security or Other Identifying Number
_____________________________________________
_____________________________________________
_____________________________________________
Signature Guarantee:* ____________
- ---------------------
* Signature must be guaranteed by an institution which is a member of one of
the following recognized Signature Guaranty Programs: (i) The Securities
Transfer Agent Medallion Program (STAMP); (ii) The New York Stock Exchange
Medallion Program (MSP); (iii) The Stock Exchange Medallion Program (SEMP);
or (iv) in such other guarantee programs acceptable to the Trustee.
24
<PAGE>
SECTION 2.4 ADDITIONAL PROVISIONS REQUIRED IN GLOBAL
DEBENTURE. Any Global Debenture issued hereunder shall, in addition to the
provisions contained in Sections 2.2 and 2.3 bear a legend in substantially
the following form:
"This Debenture is a Global Debenture within the meaning of the Subordinated
Indenture hereinafter referred to and is registered in the name of a
Depositary or a nominee of a Depositary. This Debenture is exchangeable for
Debentures registered in the name of a person other than the Depositary or
its nominee only in the limited circumstances described in the Subordinated
Indenture and may not be transferred except as a whole by the Depositary to a
nominee of the Depositary or by a nominee of the Depositary to the Depositary
or another nominee of the Depositary."
SECTION 2.5 FORM OF TRUSTEE'S CERTIFICATE OF
AUTHENTICATION. The form of Trustee's Certificate of Authentication shall be
as follows:*
"This is one of the Debentures designated therein referred to in the within
mentioned Subordinated Indenture.
THE FIRST NATIONAL BANK OF CHICAGO,
as Trustee
By:
Authorized Signatory
Dated: ________________"
SECTION 2.6 INITIAL ISSUANCE TO PROPERTY TRUSTEE. The
Debentures initially issued to the Property Trustee of the Trust shall be in
the form of one or more individual certificates in definitive, fully
registered form without distribution coupons and shall bear the following
legend (the "RESTRICTED SECURITIES LEGEND") unless the Company determines
otherwise in accordance with applicable law:
"THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY HAS NOT BEEN
REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF,
U.S. PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS
ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT IT IS A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT), (2)
AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER
- ---------------
* Or in the form provided in Section 6.14 in the event that a separate
Authenticating Agent is appointed pursuant thereto.
25
<PAGE>
THE SECURITY EVIDENCED HEREBY OR THE COMMON STOCK, IF ANY, ISSUABLE UPON
CONVERSION OR EXCHANGE OF SUCH SECURITY EXCEPT (A) TO TOWER AUTOMOTIVE, INC.
OR A SUBSIDIARY THEREOF, (B) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES
IS A QUALIFIED INSTITUTIONAL BUYER PURCHASING FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A UNDER THE SECURITIES ACT, OR (C) PURSUANT TO THE
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF
AVAILABLE) AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE
SECURITY EVIDENCED HEREBY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT
OF THIS LEGEND. IN CONNECTION WITH ANY TRANSFER OF THE SECURITY EVIDENCED
HEREBY PRIOR TO THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF
THE SECURITY EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES ACT (OR
ANY SUCCESSOR PROVISION), THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH
ON THE REVERSE HEREOF RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS
CERTIFICATE TO THE TRUSTEE FOR THE PREFERRED SECURITIES OR THE DEBENTURES, AS
THE CASE MAY BE (OR, IF THIS CERTIFICATE EVIDENCES COMMON STOCK, SUCH HOLDER
MUST FURNISH TO THE TRANSFER AGENT), TOGETHER WITH SUCH CERTIFICATIONS, LEGAL
OPINIONS OR OTHER INFORMATION AS TOWER AUTOMOTIVE, INC., THE TRUSTEE OR THE
TRANSFER AGENT, AS APPLICABLE, MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH
TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THIS LEGEND
WILL BE REMOVED AFTER THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO
SALES OF THE SECURITY EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES
ACT."
ARTICLE 3
THE DEBENTURES
SECTION 3.1 AMOUNT OF DEBENTURES. The aggregate principal
amount of Debentures which may be authenticated and delivered under this
Subordinated Indenture is $266,752,600 for Debentures authenticated and
delivered upon registration of, transfer of, or in exchange for, or in lieu
of, other Debentures pursuant to Sections 3.4, 3.5 or 3.6.
SECTION 3.2 DENOMINATIONS. The Debentures shall be in
registered form without coupons and shall be issuable in denominations of $50
and any integral multiple thereof.
SECTION 3.3 EXECUTION, AUTHENTICATION, DELIVERY AND DATING.
The Debentures shall be executed on behalf of the Company by its President
or one of its Vice Presidents attested by its Secretary, one of its Assistant
Secretaries, or a Vice President. The signature of any of these officers on
the Debentures may be manual or facsimile.
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Debentures 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 Debentures
or did not hold such offices at the date of such Debentures. Upon the
execution and delivery of this Subordinated Indenture, or from time to time
thereafter, Debentures may be executed by the Company and delivered to the
Trustee for authentication, and the Trustee shall thereupon authenticate and
deliver said Securities to or upon Company Order without any further action
by the Company. Debentures may be authenticated on original issuance from
time to time and delivered pursuant to such procedures acceptable to the
Trustee ("PROCEDURES") as may be specified from time to time by Company
Order. Procedures may authorize authentication and delivery pursuant to
instructions of the Company or a duly authorized agent, which instructions
shall be promptly confirmed in writing.
Each Debenture shall be dated the date of its authentication.
No Debenture shall be entitled to any benefit under this Subordinated
Indenture or be valid or obligatory for any purpose, unless there appears on
such Debenture a certificate of authentication substantially in the form
provided for herein executed by the Trustee by the manual signature of one of
its authorized officers, and such certificate upon any Debenture shall be
conclusive evidence, and the only evidence, that such Debenture has been duly
authenticated and delivered hereunder.
SECTION 3.4 TEMPORARY DEBENTURES. Pending the preparation
of definitive Debentures, the Company may execute, and upon Company Order the
Trustee shall authenticate and deliver, temporary Debentures which are
printed, lithographed, typewritten, mimeographed or otherwise produced, in
any denomination, substantially of the tenor of the definitive Debentures in
lieu of which they are issued and with such appropriate insertions,
omissions, substitutions and other variations as the officers executing such
Debentures may determine, as evidenced by their execution of such Debentures.
If temporary Debentures are issued, the Company will cause definitive
Debentures to be prepared without unreasonable delay. After the preparation
of definitive Debentures, the temporary Debentures shall be exchangeable for
definitive Debentures upon surrender of the temporary Debentures at the
office or agency of the Company designated for the purpose without charge to
the Holder. Upon surrender for cancellation of any one or more temporary
Debentures, the Company shall execute and the Trustee shall authenticate and
deliver in exchange therefor a like principal amount of definitive Debentures
of authorized denominations. Until so exchanged, the temporary Debentures
shall in all respects be entitled to the same benefits under this
Subordinated Indenture as definitive Debentures.
SECTION 3.5 REGISTRATION, TRANSFER AND EXCHANGE. The
Company shall cause to be kept at the Corporate Trust Office of the Trustee a
register in which, subject to such reasonable regulations as it may
prescribe, the Company shall provide for the registration of Debentures and
of transfers of Debentures. Such register is herein sometimes referred to as
the "SECURITIES REGISTER." The Trustee is hereby appointed "SECURITIES
REGISTRAR" for the purpose of registering Debentures and transfers of
Debentures as herein provided.
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Upon surrender for registration or transfer of any Debenture at the
office or agency of the Company designated for that purpose the Company shall
execute, and the Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Debentures of any
authorized denominations, of a like aggregate principal amount.
At the option of the Holder, Debentures may be exchanged for other
Debentures of any authorized denominations, of a like aggregate principal
amount, upon surrender of the Debentures to be exchanged at such office or
agency. Whenever any Debentures are so surrendered for exchange, the Company
shall execute, and the Trustee shall authenticate and deliver, the Debentures
which the Holder making the exchange is entitled to receive.
All Debentures issued upon any transfer or exchange of Debentures
shall be the valid obligations of the Company, evidencing the same debt, and
entitled to the same benefits under this Subordinated Indenture, as the
Debentures surrendered upon such transfer or exchange.
Every Debenture presented or surrendered for transfer or exchange
shall (if so required by the Company or the Securities Registrar) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Securities Registrar, duly executed by
the Holder thereof or his attorney duly authorized in writing.
No service charge shall be made to a Holder for any transfer or
exchange of Debentures, 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 transfer or exchange of Debentures.
Notwithstanding any of the foregoing, the Global Debenture shall be
exchangeable pursuant to this Section 3.5 for Debentures registered in the
names of Persons other than the Depositary for such Debenture or its nominee
only if (a) such Depositary notifies the Company that it is unwilling or
unable to continue as Depositary for the Global Debenture, and the Company
shall not have appointed a successor depositary within 90 days after such
notice, (b) at any time such Depositary ceases to be a clearing agency
registered under the Securities Exchange Act of 1934, as amended, and the
Company shall not have appointed a successor depositary within 90 days, (c)
the Company executes and delivers to the Trustee a Company Order that the
Global Debenture shall be so exchangeable or (d) there shall have occurred
and be continuing a Debenture Event of Default. The Global Debenture shall
be exchangeable for Debentures registered in such names as such Depositary
shall direct.
Notwithstanding any other provisions in this Subordinated Indenture,
the Global Debenture may not be transferred except as a whole by the
Depositary with respect to the Global Debenture to a nominee of such
Depositary or by a nominee of such Depositary to such Depositary or another
nominee of such Depositary.
Neither the Company nor the Trustee shall be required, pursuant to the
provisions of this Section, (a) to issue, transfer or exchange any Debenture
during a period beginning at the opening of business 15 days before the day
of selection for redemption of Debentures pursuant to Article 11 and ending
at the close of business on the day of mailing of notice of redemption or (b)
to transfer
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or exchange any Debenture so selected for redemption in whole or in part,
except, in the case of any Debenture to be redeemed in part, any portion
thereof not to be redeemed.
Upon any distribution of the Debentures to the holders of the
Preferred Securities in accordance with the Declaration, the Company and the
Trustee shall enter into a supplemental indenture pursuant to Section 9.1(i)
to provide for transfer procedures with respect to the Debentures
substantially similar to those contained in the Declaration to the extent
applicable in the circumstances existing at the time of such distribution.
SECTION 3.6 MUTILATED, DESTROYED, LOST AND STOLEN
DEBENTURES. If any mutilated Debenture is surrendered to the Trustee
together with 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 in exchange therefor a new Debenture
and bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and to the Trustee (a)
evidence to their satisfaction of the destruction, loss or theft of any
Debenture, and (b) such security or indemnity as may be required by them to
save each of them harmless, then, in the absence of actual notice to the
Company or the Trustee that such Debenture has been acquired by a bona fide
purchaser, the Company shall execute and upon the receipt of a Company Order
requesting authentication, the Trustee shall authenticate and deliver, in
lieu of any such destroyed, lost or stolen Debenture, a new Debenture bearing
a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Debenture has
become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Debenture, pay such Debenture.
Upon the issuance of any new Debenture under this Section, the Company
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Debenture issued pursuant to this Section in lieu of any
destroyed, lost or stolen Debenture shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Debenture shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Subordinated Indenture equally and
proportionately with any and all other Debentures 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 Debentures.
SECTION 3.7 PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED.
Interest on any Debenture 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 Debenture (or one or more Predecessor
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Debentures) is registered at the close of business on the Regular Record
Date, except that interest payable on the Stated Maturity of the Debentures
shall be paid to the Person to whom principal is paid.
Any interest on the Debentures which is payable, but is not timely
paid or duly provided for, on an Interest Payment Date ("DEFAULTED
INTEREST"), shall forthwith cease to be payable to the registered Holder on
the 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 (a) or (b) below:
(a) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Debentures (or their
respective Predecessors Debentures) are registered at the close of
business on a Special Record Date for the payment of such Defaulted
Interest, which shall be fixed in the following manner. The Company
shall notify the Trustee in writing of the amount of Defaulted
Interest proposed to be paid on the Debentures and the date of the
proposed payment, and at the same time the Company shall deposit with
the Trustee an amount of money equal to the aggregate amount proposed
to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the
date of the proposed payment, such money when deposited to be held in
trust for the benefit of the Persons entitled to such Defaulted
Interest as in this Clause provided. Thereupon the Trustee shall fix
a Special Record Date for the payment of such Defaulted Interest which
shall be not more than 15 days and not less than 10 days prior to the
date of the proposed payment and not less than 10 days after the
receipt by the Trustee of the notice of the proposed payment. The
Trustee shall promptly notify the Company of such Special Record Date
and, in the name and at the expense of the Company, shall cause notice
of the proposed payment of such Defaulted Interest and the Special
Record Date therefor to be mailed, first class, postage prepaid, to
each Holder of the Debentures at the address of such Holder as it
appears in the Securities 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 mailed as
aforesaid, such Defaulted Interest shall be paid to the Persons in
whose names the Debentures (or their respective Predecessor
Debentures) are registered on such Special Record Date and shall no
longer be payable pursuant to the following clause (b).
(b) The Company may make payment of any Defaulted
Interest in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Debentures may be
listed and, upon such notice as may be required by such exchange (or
by the Trustee if the Debentures are not listed), if, after notice
given by the Company to the Trustee of the proposed payment pursuant
to this Clause, such payment shall be deemed practicable by the
Trustee.
Subject to the foregoing provisions of this Section, each Debenture
delivered under this Subordinated Indenture upon transfer of or in exchange
for or in lieu of any other Debenture shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Debenture.
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SECTION 3.8 PERSONS DEEMED OWNERS. The Company, the
Trustee, the Paying Agent and any agent of the Company or the Trustee or the
Paying Agent may treat the Person in whose name any Debenture is registered
as the owner of such Debenture for the purpose of receiving payment of
principal of and (subject to Section 3.7) interest or premium on such
Debenture and for all other purposes whatsoever, whether or not such
Debenture be overdue, and neither the Company, the Trustee nor any agent of
the Company or the Trustee shall be affected by notice to the contrary.
SECTION 3.9 CANCELLATION. All Debentures surrendered for
payment, redemption, conversion, transfer or exchange shall, if surrendered
to any Person other than the Trustee, be delivered to the Trustee, and any
such Debentures and Debentures surrendered directly to the Trustee for any
such purpose shall be promptly canceled by it. The Company may at any time
deliver or cause to be delivered to the Trustee for cancellation any
Debentures previously authenticated and delivered hereunder which the Company
may have acquired in any manner whatsoever, and all Debentures so delivered
shall be promptly canceled by the Trustee. No Debentures shall be
authenticated in lieu of or in exchange for any Debentures canceled as
provided in this Section, except as expressly permitted by this Subordinated
Indenture. All canceled Debentures shall be destroyed by the Trustee and
upon written request, the Trustee shall deliver to the Company a certificate
of such destruction.
SECTION 3.10 COMPUTATION OF INTEREST. Interest on the
Debentures shall be computed on the basis of a 360-day year of twelve 30-day
months.
SECTION 3.11 DEFERRALS OF INTEREST PAYMENT PERIODS. The
Company shall have the right, at any time during the term of the Debentures,
so long as no Debenture Event of Default has occurred and is continuing, from
time to time to extend the interest payment period for the Debentures for up
to 20 consecutive quarters with respect to each deferral period (each, an
"EXTENSION PERIOD") during which periods the Company shall have the right to
not make payments of interest on any Interest Payment Date, and at the end of
such Extension Period the Company shall pay all interest then accrued and
unpaid thereon (together with Additional Interest thereon, if any, at the
rate specified for the Debentures, to the extent permitted by applicable
law), PROVIDED, HOWEVER, that during any such Extension Period, the Company
shall not, and shall cause any Subsidiary not to, (i) declare or pay
dividends on, make distributions with respect to, or redeem, purchase or
acquire, or make a liquidation payment with respect to any of its Capital
Stock (except for (x) dividends or distributions in shares of, or options,
warrants or rights to subscribe for or purchase shares of its Capital Stock
and conversions or exchanges of Common Stock of one class for Common Stock of
another class and (y) redemptions or purchases of any rights pursuant to a
rights agreement and the issuance of Capital Stock pursuant to such rights)
or (ii) make any payments of principal, interest or premium, if any, on or
repay or repurchase or redeem any debt securities (including guarantees of
indebtedness for money borrowed) of the Company that rank PARI PASSU with or
junior to the Debentures (other than (u) any redemption, liquidation,
interest, principal or guarantee payment by the Company where the payment is
made by way of securities (including Capital Stock) that rank PARI PASSU with
or junior to the securities on which such redemption, liquidation, interest,
principal or guarantee payment is being made, (v) payments under the
Guarantee (as defined in the Declaration) or the Common Securities Guarantee
(as defined in the Declaration), (w) purchases of Common Stock related to the
issuance of Common Stock under any
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of the Company's benefit plans for its directors, officers or employees, (x)
as a result of a reclassification of the Company's Capital Stock or the
exchange or conversion of one series or class of the Company's Capital Stock
for another series or class of the Company's Capital Stock, (y) the purchase
of fractional interests in shares of the Company's Capital Stock pursuant to
the conversion or exchange provisions of such Capital Stock or the security
being converted or exchanged and (z) redemptions or purchases of any rights
pursuant to a rights agreement and the issuance of Capital Stock pursuant to
such rights). Prior to the termination of any such Extension Period, the
Company may further extend the interest payment period, PROVIDED that no such
Extension Period shall exceed 20 consecutive quarters or extend beyond the
Stated Maturity of the Debentures. Upon termination of any Extension Period
and upon the payment of all accrued and unpaid interest and any Additional
Interest then due, the Company may select a new Extension Period, subject to
the above requirements. No interest, including Additional Interest, if any,
shall be due and payable during an Extension Period, except at the end
thereof. The Company shall give the Trustee, the Property Trustee and the
Administrative Trustees written notice of its selection of such Extension
Period at least one Business Day prior to the earlier of (i) the record date
for the date the distributions on the Preferred Securities of the Trust (or
if no, Preferred Securities are outstanding, for the date interest on the
Debentures) would have been payable except for the election to begin such
Extension Period and (ii) the date the Property Trustee (or, if no Preferred
Securities are outstanding, the Trustee) is required to give notice to NYSE
or other applicable self-regulatory organization or to holders of such
Preferred Securities (or, if no Preferred Securities are outstanding, to the
Holders of such Debentures) of such record date, but in any event not less
than one Business Day prior to such record date. Such notice shall specify
the period selected.
The Trustee shall promptly give notice of the Company's selection of
such Extension Period to the Holders of the outstanding Debentures and
Preferred Securities.
SECTION 3.12 RIGHT OF SET-OFF. Notwithstanding anything to
the contrary in the Subordinated Indenture, the Company shall have the right
to set-off any payment it is otherwise required to make thereunder in respect
of the Debenture to the extent the Company has theretofore made, or is
concurrently on the date of such payment making, a payment relating to the
Debentures under the Guarantee.
SECTION 3.13 AGREED TAX TREATMENT. Each Debenture issued
hereunder shall provide that the Company and, by its acceptance of a
Debenture or a beneficial interest therein, the Holder of, and any Person
that acquires a beneficial interest in, such Debenture agree that for United
States Federal, state and local tax purposes it is intended that such
Debenture constitute indebtedness.
SECTION 3.14 CUSIP NUMBERS. The Company in issuing the
Debentures may use "CUSIP" numbers (if then generally in use), and, if so,
the Trustee shall use such "CUSIP" number in notices of redemption as a
convenience to Holders; PROVIDED that any such notice may state that no
representation is made as to the correctness of such number either as printed
on the Debentures or as contained in any notice of a redemption and that
reliance may be placed only on the other identification numbers printed on
the Debentures, and any such redemption shall not be affected by any defect
in or omission of such numbers.
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SECTION 3.15 GLOBAL SECURITY.
(a) In connection with distribution of Debentures to holders
of the Preferred Securities in connection with the involuntary or
voluntary dissolution of the Trust, including a dissolution following
the occurrence of a Special Event,
(i) the Debentures in certificated form may be presented to
the Trustee by the Property Trustee in exchange for a global
certificate in an aggregate principal amount equal to the
aggregate principal amount of all outstanding Debentures (a
"GLOBAL DEBENTURE"), to be registered in the name of the
Depositary, or its nominee, and delivered by the Trustee to the
Depositary, or its custodian, for crediting to the accounts of its
participants pursuant to the procedures of the Depositary. The
Company upon any such presentation shall execute a Global
Debenture in such aggregate principal amount and deliver the same
to the Trustee for authentication and delivery in accordance with
this Subordinated Indenture; and
(ii) if any Preferred Securities are held in non
book-entry certificated form, the Debentures in certificated
form may be presented to the Trustee by the Property Trustee
and any Preferred Security certificate which represents
Preferred Securities other than Preferred Securities held by
the Depositary or its nominee ("NON BOOK-ENTRY PREFERRED
SECURITIES") will be deemed to represent beneficial interests
in Debentures presented to the Trustee by the Property Trustee
having an aggregate principal amount equal to the aggregate
liquidation amount of the Non Book-Entry Preferred Securities
until such Preferred Security certificates are presented to the
Securities Registrar for transfer or reissuance at which time
such Non-Book Entry Preferred Security certificates will be
canceled and a Debenture, registered in the name of the holder
of the Preferred Security certificate or the transferee of the
holder of such Preferred Security certificate, as the case may
be, with an aggregate principal amount equal to the aggregate
liquidation amount of the Preferred Security certificate
canceled, will be executed by the Company and delivered to the
Trustee for authentication and delivery in accordance with this
Subordinated Indenture. On issue of such Debentures,
Debentures with an equivalent aggregate principal amount that
were presented by the Property Trustee to the Trustee will be
deemed to have been canceled.
(b) A Global Debenture may be transferred, in whole but not in
part, only to another nominee of the Depositary, or to a nominee of such
successor Depositary.
(c) If (a) the Depositary notifies the Company that it is
unwilling or unable to continue as a depositary for such Global
Debenture and no successor depositary shall have been appointed within
90 days by the Company, (b) the Depositary, at any time, ceases to be
a clearing agency registered under the Exchange Act at which time the
Depositary is required to be so registered to act as such depositary
and no successor depositary shall have been appointed within 90 days
by the Company, (c) the Company, in its sole discretion, determines
that such Global Debenture shall be so exchangeable or (d) there shall
have
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occurred and be continuing a Debenture Event of Default with
respect to such Debentures, as the case may be, the Company will
execute, and, subject to Article 3 of this Subordinated Indenture, the
Trustee, upon written notice from the Company and receipt of a Company
Order, will authenticate and deliver the Debentures in definitive
registered form without coupons, in authorized denominations, and in
an aggregate principal amount equal to the principal amount of the
Global Debenture in exchange for such Global Debenture. In addition,
upon a Debenture Event of Default that has occurred and is continuing
or in the event the Company determines that the Debenture shall no
longer be represented by a Global Debenture, the Company will execute,
and subject to Section 3.5 of this Subordinated Indenture, the
Trustee, upon receipt of an Officers' Certificate evidencing such
determination by the Company and a Company Order, will authenticate
and make available for delivery, the Debentures in definitive
registered form without coupons, in authorized denominations, and in
an aggregate principal amount equal to the principal amount of the
Global Debenture in exchange for such Global Debenture. Upon the
exchange of the Global Debenture for such Debentures in definitive
registered form without coupons, in authorized denominations, the
Global Debenture shall be canceled by the Trustee. Such Debentures in
definitive registered form issued in exchange for the Global Debenture
shall be registered in such names and in such authorized denominations
as the Depositary, pursuant to instructions from its direct or
indirect participants or otherwise, shall instruct the Trustee in
writing. The Trustee shall deliver such Debentures to the Depositary
for delivery to the Persons in whose names such Debentures are so
registered.
ARTICLE 4
SATISFACTION AND DISCHARGE
SECTION 4.1 SATISFACTION AND DISCHARGE OF INDENTURE. This
Subordinated Indenture shall cease to be of further effect (except as to (i)
any surviving rights of transfer, substitution and exchange of Debentures,
(ii) rights hereunder of Holders to receive payments of principal of (and
premium, if any) and interest (including Additional Interest, if any) on the
Debentures and other rights, duties and obligations of the Holders as
beneficiaries hereof with respect to the amounts, if any, so deposited with
the Trustee and (iii) the rights and obligations of the Trustee hereunder),
and the Trustee, on demand of and at the expense of the Company, shall
execute proper instruments acknowledging satisfaction and discharge of this
Subordinated Indenture, when
(a) either
(i) all Debentures theretofore authenticated and delivered
(other than (i) Debentures which have been destroyed, lost or
stolen and which have been replaced or paid as provided in
Section 3.6 and (ii) Debentures for whose payment money has
theretofore been deposited in trust or segregated and held in
trust by the Company and thereafter repaid to the Company or
discharged from such trust, as provided in Section 10.3) have
been delivered to the Trustee for cancellation; or
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(ii) all such Debentures not theretofore delivered to the
Trustee for cancellation:
(A) have become due and payable, or
(B) will become due and payable at their Stated
Maturity within one year of the date of deposit or are
to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving
of written notice of redemption to the Trustee in the
name, and at the expense, of the Company, and the
Company has deposited or caused to be deposited with the
Trustee as trust funds in trust for such purpose an
amount in the currency or currencies in which the
Debentures are payable sufficient (without regard to
investment of such amount deposited) to pay and
discharge the entire indebtedness on the Debentures not
theretofore delivered to the Trustee for cancellation,
for principal (and premium, if any) and interest
(including any Additional Interest) to the date of such
deposit or to the Stated Maturity; or
(c) have been redeemed or tendered for conversion;
or
(b) the Company has paid or caused to be paid all other sums
payable hereunder by the Company; and
(c) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel each stating that all conditions
precedent herein provided for relating to the satisfaction and discharge
of this Subordinated Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Subordinated Indenture,
the obligations of the Company to the Trustee under Section 6.7 and, if money
shall have been deposited with the Trustee pursuant to subclause (ii) of clause
(a) of this Section, the obligations of the Trustee under Section 4.2 and the
last paragraph of Section 10.3 shall survive.
SECTION 4.2 APPLICATION OF TRUST MONEY. Subject to the
provisions of the last paragraph of Section 10.3, all money deposited with
the Trustee pursuant to Section 4.1 shall be held in trust and applied by it,
in accordance with the provisions of the Debentures and this Subordinated
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and interest for whose payment such money or obligations have been
deposited with or received by the Trustee; PROVIDED, HOWEVER, such moneys
need not be segregated from other funds except to the extent required by law.
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ARTICLE 5
REMEDIES
SECTION 5.1 DEBENTURE EVENTS OF DEFAULT. "DEBENTURE EVENT
OF DEFAULT," wherever used herein with respect to the Debentures, means any
one of the following events that has occurred and is continuing (whatever the
reason for such Debenture 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):
(a) default in the payment of any interest upon the Debenture,
including any Additional Interest in respect thereof, when it becomes due
and payable, and continuance of such default for a period of 30 days
(subject to the deferral of any due date in the case of an Extension
Period);
(b) default in the payment of the principal of (or premium,
if any, on) the Debentures when due whether at Stated Maturity, upon
redemption by declaration or otherwise;
(c) failure on the part of the Company duly to observe or
perform in any material respect any other of the covenants or
agreements on the part of the Company contained in the Debentures or
contained in this Subordinated Indenture (other than a covenant or
agreement which has been expressly included in this Subordinated
Indenture solely for the benefit of the Company) and continuance of
such failure for a period of 90 days after the date on which written
notice of such failure, requiring the same to be remedied and stating
that such notice is a "NOTICE OF DEFAULT" hereunder, shall have been
given to the Company by the Trustee, by registered or certified mail,
or to the Company and the Trustee by a Holder or Holders of at least
25% in aggregate principal amount of the Debentures at the time
Outstanding or the holder or holders of at least 25% in aggregate
liquidation amount of the Preferred Securities;
(d) failure by the Company to issue Common Stock upon an
appropriate election by the Holder or Holders of the Debentures to
convert the Debentures into shares of Common Stock;
(e) the voluntary or involuntary dissolution, winding up or
termination of the Trust, except in connection with the distribution of
the Debentures to Holders in a liquidation of the Trust, the redemption
or conversion of all of the Trust Securities or in connection with the
merger, consolidation or amalgamation of the Trust as permitted by the
Declaration;
(f) the entry of a decree or order by a court having
jurisdiction in the premises adjudging the Company as bankrupt or
insolvent, or approving as properly filed a petition seeking
reorganization, arrangement, adjudication or composition of or in
respect of the Company under any applicable Federal or State
bankruptcy, insolvency, reorganization or other similar law, or
appointing a receiver, liquidator, assignee, trustee, sequestrator (or
other similar official) of the Company or of any substantial part of
its property or ordering the
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winding up or liquidation of its affairs, and the continuance of any
such decree or order unstayed and in effect for a period of 60
consecutive days; or
(g) the institution by the Company of proceedings to be
adjudicated as bankrupt or insolvent, or the consent by it to the
institution of bankruptcy or insolvency proceedings against it, or the
filing by it of a petition or answer or consent seeking reorganization or
relief under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law, or the consent by it to the filing
of any such petition or to the appointment of a receiver, liquidator,
assignee, trustee, sequestrator (or other similar official) of the
Company or of any substantial part of its property or the making by it
of an assignment for the benefit of creditors, or the admission by it in
writing of its inability to pay its debts generally as they become due
and its willingness to be adjudicated as bankrupt, or the taking of
corporate action by the Company in furtherance of any such action.
SECTION 5.2 ACCELERATION OF MATURITY; RESCISSION AND
ANNULMENT. If a Debenture Event of Default occurs and is continuing, then and
in every such case the Trustee or the Holders of not less than 25% in
aggregate principal amount of the Outstanding Debentures may declare the
principal amount of all the Debentures to be due and payable immediately, by
a notice in writing to the Company (and to the Trustee if given by Holders),
PROVIDED that, if a Debenture Event of Default occurs and is continuing, and
the Trustee or the Holders of not less than 25% in aggregate principal amount
of the Outstanding Debentures fail to declare the principal of all the
Debentures to be immediately due and payable, the holders of at least 25% in
aggregate liquidation amount of the Preferred Securities then outstanding
shall have such right by a notice in writing to the Company and the Trustee,
and upon any such declaration such principal amount (or specified amount) of
and the accrued interest (including any Additional Interest) on all the
Debentures shall become immediately due and payable, PROVIDED that the
payment of principal and interest (including any Additional Interest) on the
Debentures shall remain subordinated to the extent provided in Article 12.
At any time after such a declaration of acceleration with respect to
Debentures 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 Debentures, by written notice to the Company and the Trustee may
rescind and annul such declaration and its consequences if:
(a) the Company has paid or deposited with the Trustee a sum
sufficient to pay:
(i) all overdue installments of interest (including any
Additional Interest) on the Debentures;
(ii) the principal of (and premium, if any, on) the
Debentures which have become due otherwise than by such
declaration of acceleration and interest thereon at the rate
borne by the Debentures;
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(iii) to the extent that payment of such interest is
lawful, interest (including any Additional Interest) upon overdue
installments of interest at the rate borne by the Debentures; and
(iv) all sums paid or advanced by the Trustee hereunder and
the reasonable compensation, expenses, disbursements and advances
of the Trustee, its agents and counsel; or
(b) all Debenture Events of Default that shall have occurred
and been continuing with respect to Debentures, other than the
non-payment of the principal of the Debentures which has become due
solely by such acceleration, have been cured or waived as provided in
Section 5.13. If the holders of a majority in aggregate principal
amount of the Outstanding Debentures fail to rescind and annul such
declaration and its consequences, the holders of a majority in
liquidation amount of the Preferred Securities then outstanding shall
have such right.
SECTION 5.3 COLLECTION OF INDEBTEDNESS AND SUITS FOR
ENFORCEMENT BY TRUSTEE. The Company covenants that if:
(a) default is made in the payment of any installment of interest
(including any Additional Interest) on the Debentures when such interest
becomes due and payable and such default continues for a period of 30
days, or
(b) default is made in the payment of the principal of (and
premium, if any, on) the Debentures whether at the Stated Maturity
thereof upon redemption by declaration or otherwise, the Company will,
upon demand of the Trustee, pay to it, for the benefit of the Holders
of the Debentures, the whole amount then due and payable on the
Debentures for principal (and premium, if any) and interest (including
any Additional Interest), including, to the extent that payment of
such interest shall be lawful, interest on any overdue principal (and
premium, if any) and on any overdue installments of interest
(including any Additional Interest) at the rate borne by the
Debentures, and, in addition thereto, all amounts owing the Trustee
under Section 6.7.
If the Company fails to pay such amounts forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust, may
institute a judicial proceeding for the collection of the sums so due and
unpaid, and may prosecute such proceeding to judgement or final decree, and
may enforce the same against the Company or any other obligor upon the
Debentures and collect the moneys adjudged or decreed to be payable in the
manner provided by law out of the property of the Company or any other
obligor upon the Debentures, wherever situated.
If a Debenture Event of Default occurs and is continuing, the Trustee
may in its discretion proceed to protect and enforce its rights and the
rights of the Holders of the Debentures 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 Subordinated
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Indenture or in aid of the exercise of any power granted herein, or to
enforce any other proper remedy.
SECTION 5.4 TRUSTEE MAY FILE PROOFS OF CLAIM. In case of
the pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Company or any other obligor upon the Debentures
or the property of the Company or of such other obligor or their creditors:
(a) the Trustee (irrespective of whether the principal of the
Debentures shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Trustee shall
have made any demand on the Company for the payment of overdue
principal (or premium, if any) or interest (including any Additional
Interest)) shall be entitled and empowered, by intervention in such
proceeding or otherwise,
(i) to file and prove a claim (including a claim for
reasonable compensation, expenses, disbursements and advances
of the Trustee, its agents and counsel) for the whole amount of
principal (and premium, if any) and interest (including any
Additional Interest) owing and unpaid in respect to the
Debentures and to file such other papers or documents as may be
necessary or advisable and to take any and all actions as are
authorized under the Trust Indenture Act in order to have the
claims of the Holders and any predecessor to the Trustee under
Section 6.7 and of the Holders allowed in any such judicial
proceedings; and
(ii) in particular, to collect and receive any moneys or
other property payable or deliverable on any such claims and to
distribute the same in accordance with Section 5.6; and
(b) any custodian, receiver, assignee, trustee, liquidator,
sequestrator (or other similar official) in any such judicial
proceeding is hereby authorized by each Holder to make such payments
to the Trustee for distribution in accordance with Section 5.6, and in
the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due
to it and any predecessor Trustee under Section 6.7.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan
of reorganization, arrangement, adjustment or composition affecting the
Debentures or the rights of any Holder thereof, or to authorize the Trustee
to vote in respect of the claim of any Holder in any such proceeding;
PROVIDED, HOWEVER, that the Trustee may, on behalf of the Holders, vote for
the election of a trustee in bankruptcy or similar official and be a member
of a creditors' or other similar committee.
SECTION 5.5 TRUSTEE MAY ENFORCE CLAIM WITHOUT POSSESSION OF
DEBENTURES. All rights of action and claims under this Subordinated
Indenture or the Debentures may be prosecuted and enforced by the Trustee
without the possession of any of the Debentures or the production thereof in
any proceeding relating thereto, and any such proceeding instituted by the
Trustee shall be brought in its own name as trustee of an express trust, and
any recovery of judgement shall, after
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provision for the payment of all the amounts owing the Trustee and any
predecessor Trustee under Section 6.7, its agents and counsel, be for the
ratable benefit of the Holders of the Debentures in respect of which such
judgement has been recovered.
SECTION 5.6 APPLICATION OF MONEY COLLECTED. Any money or
property collected or to be applied by the Trustee with respect to the
Debentures pursuant to this Article shall be applied in the following order,
at the date or dates fixed by the Trustee and, in case of the distribution of
such money or property on account of principal (or premium, if any) or
interest (including any Additional Interest), upon presentation of the
Debentures and the notation thereon of the payment if only partially paid and
upon surrender thereof if fully paid:
FIRST: to the payment of all amounts due the Trustee and any
predecessor Trustee under Section 6.7,
SECOND: to the payment of the amounts then due and unpaid upon the
Debentures for principal (and premium, if any) and interest (including any
Additional Interest), in respect of which or for the benefit of which such
money has been collected, ratably, without preference or priority of any
kind, according to the amounts due and payable on the Debentures for
principal (and premium, if any) and interest (including any Additional
Interest), respectively; and
THIRD: the balance, if any, to the Person or Persons entitled thereto.
SECTION 5.7 LIMITATION ON SUITS. No Holder of the
Debentures, including a holder of Preferred Securities acting to enforce the
rights of the Property Trustee as a Holder of the Debentures pursuant to
Section 5.8 of the Declaration, shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Subordinated
Indenture or for the appointment of a receiver, assignee, trustee,
liquidator, sequestrator (or other similar official) or for any other remedy
hereunder, unless:
(a) such Holder has previously given written notice to the
Trustee of a continuing Debenture Event of Default;
(b) if the Trust is not the sole holder of the Outstanding
Debentures, the Holders of not less than 25% in principal amount of
the Outstanding Debentures shall have made written request to the
Trustee to institute proceedings in respect of such Debenture Event of
Default in its own name as Trustee hereunder;
(c) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to be
incurred in compliance with such request;
(d) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such
proceeding; and
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(e) no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Holders of
a majority in principal amount of the Outstanding Debentures;
it being understood and intended that no one or more of such Holders shall
have any right in any manner whatever by virtue of, or by availing of any
provision of this Subordinated Indenture to affect, disturb or prejudice the
rights of any other Holders of the Debentures, or to obtain or to seek to
obtain priority or preference over any other of such Holders or to enforce
any right under this Subordinated Indenture, except in the manner herein
provided and for the equal and ratable benefit of all such Holders.
SECTION 5.8 UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE
PRINCIPAL, PREMIUM AND INTEREST. Notwithstanding any other provision in this
Subordinated Indenture, the Holder of any Debenture shall have the right
which is absolute and unconditional to receive payment of the principal of
(and premium, if any) and (subject to Sections 3.7 and 3.11) interest
(including any Additional Interest) on such Debenture on its Stated Maturity
or to convert such Debenture in accordance with Article 13 and to institute
suit for the enforcement of any such payment and right to convert, and such
right shall not be impaired without the consent of such Holder. For so long
as any Preferred Securities remain Outstanding, to the fullest extent
permitted by law and subject to the terms of this Subordinated Indenture and
the Declaration, upon a Debenture Event of Default that has occurred and is
continuing specified in Sections 5.1(a) or 5.1(b), any holder of Preferred
Securities shall have the right to institute a proceeding directly against
the Company, for enforcement of payment to such holder of the principal
amount of (or premium, if any) or interest (including Additional Interest) on
Debentures having a principal amount equal to the liquidation amount of the
Preferred Securities of such holder (a "DIRECT ACTION"). Notwithstanding any
payment made to such holder of Preferred Securities by the Company in
connection with a Direct Action, the Company shall remain obligated to pay
the principal of (or premium, if any) or interest (including Additional
Interest) on the Debentures held by the Trust or the Property Trustee. In
connection with any such Direct Action, the rights of the Company will be
subrogated to the rights of any holder of the Preferred Securities to the
extent of any payment made by the Company to such holder of Preferred
Securities as a result of such Direct Action. Except as set forth in this
Section, the holders of Preferred Securities shall have no right to execute
any right or remedy available to the Holders of or in respect of, the
Debentures.
SECTION 5.9 RESTORATION OF RIGHTS AND REMEDIES. If the
Trustee or any Holder has instituted any proceeding to enforce any right or
remedy under this Subordinated 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 the Company, the
Trustee and the Holder shall, subject to any determination in such
proceeding, 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 5.10 RIGHTS AND REMEDIES CUMULATIVE. Except as
otherwise provided in the last paragraph of Section 3.6, no right or remedy
herein conferred upon or reserved to the Trustee or to the Holders is
intended to be exclusive of any other right or remedy, and every right and
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remedy shall, to the extent permitted by law, be cumulative and in addition
to every other right and remedy given hereunder or now or hereafter existing
at law or in equity or otherwise. The assertion or employment of any right
or remedy hereunder, or otherwise, shall not prevent the concurrent assertion
or employment of any other appropriate right or remedy.
SECTION 5.11 DELAY OR OMISSION NOT WAIVER. No delay or
omission of the Trustee or of any Holder of the Debentures to exercise any
right or remedy accruing upon any Debenture Event of Default that shall have
occurred and be continuing shall impair any such right or remedy, or
constitute a waiver of any such Debenture Event of Default or an acquiescence
therein.
Every right and remedy given by this Article or by law to the Trustee
or to the Holders may be exercised from time to time, and as often as may be
deemed expedient, by the Trustee or by the Holders, as the case may be.
SECTION 5.12 CONTROL BY HOLDERS. The Holders of a majority
in aggregate principal amount of the Outstanding Debentures shall have the
right to direct the time, method and place of conducting any proceeding for
any remedy available to the Trustee or exercising any trust or power
conferred on the Trustee, with respect to the Debentures, PROVIDED that:
(a) such direction shall not be in conflict with any rule of
law or with this Subordinated Indenture,
(b) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction, and
(c) subject to the provisions of Section 6.1, the Trustee
shall have the right to decline to follow such direction if the
Trustee in good faith shall, by a Responsible Officer or Officers of
the Trustee, determine that the proceeding so directed would be
unjustly prejudicial to the Holders not joining in any such direction
or would involve the Trustee in personal liability.
Upon receipt by the Trustee of any written notice directing the time,
method or place of conducting any such proceeding or exercising any such
trust or power, with respect to the Debentures and, if all or part of the
Debentures is represented by a Global Security, a record date shall be
established for determining Holders of Outstanding Debentures entitled to
join in such notice, which record date shall be at the close of business on
the day the Trustee receives such notice. The Holders on such record date,
or their duly designated proxies, and only such Persons, shall be entitled to
join in such notice, whether or not such Holders remain Holders after such
record date, PROVIDED, that, unless the Holders of a majority in principal
amount of the Outstanding Debentures shall have joined in such notice prior
to the day which is 90 days after such record date, such notice shall
automatically and without further action by any Holder be canceled and of no
further effect. Nothing in this paragraph shall prevent a Holder, or a proxy
of a Holder, from giving, after expiration of such 90-day period, a new
notice identical to a notice which has been canceled pursuant to the proviso
to the preceding sentence, in which event a new record date shall be
established pursuant to the provisions of this Section 5.12.
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SECTION 5.13 WAIVER OF PAST DEFAULTS. Subject to Section
9.2 hereof, the Holders of not less than a majority in aggregate principal
amount of the Outstanding Debentures affected by any past default may on
behalf of the Holders of all the Debentures waive any past default hereunder
with respect to Debentures and its consequences, except a default:
(a) in the payment of the principal of (or premium, if any)
or interest (including any Additional Interest) on the Debentures
(unless such default has been cured or waived and a sum sufficient to
pay all matured installments of interest, Additional Interest and
principal due otherwise than by acceleration has been deposited with
the Trustee), or
(b) in respect of a covenant or provision hereof which under
Article 9 cannot be modified or amended without the consent of the
Holder of each Outstanding Debenture;
PROVIDED, HOWEVER, that if the Debentures are held by the Trust or a trustee
of the Trust, such waiver shall not be effective until the holders of a
majority in liquidation amount of Trust Securities shall have consented to
such waiver; PROVIDED, FURTHER, that if the consent of the Holder of each
outstanding Debenture is required, such waiver shall not be effective until
each holder of the Trust Securities shall have consented to such waiver.
Upon any such waiver, such default shall cease to exist, and any
Debenture Event of Default arising therefrom shall be deemed to have been
cured, for every purpose of this Subordinated Indenture, but no such waiver
shall extend to any subsequent or other default or impair any right
consequent thereon. If the Holders of a majority in aggregate principal
amount of the Outstanding Debentures fail to waive such Debenture Event of
Default, the holders of a majority in aggregate liquidation amount of
Preferred Securities shall have such right. No such rescission shall affect
any subsequent default or impair any right consequent thereon. The
provisions of this Section 5.13 shall be in lieu of Section 316(a)(1)(B) of
the Trust Indenture Act, and such Section 316(a)(1)(B) of the Trust Indenture
Act is hereby expressly excluded from this Subordinated Indenture and the
Debentures, as permitted by the Trust Indenture Act.
SECTION 5.14 UNDERTAKING FOR COSTS. All parties to this
Subordinated Indenture agree, and each Holder of any Debenture by his
acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, in any suit for the enforcement of any right or remedy
under this Subordinated Indenture, or in any suit against the Trustee for any
action taken or omitted by it as Trustee the filing by any party litigant in
such suit of an undertaking to pay the costs of such suit, and that such
court may in its discretion assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in such suit, having
due regard to the merits and good faith of the claims or defenses made by
such party litigant; but the provisions of this Section shall not apply to
any suit instituted by the Trustee, to any suit instituted by any Holder, or
group of Holders, holding in the aggregate more than 10% in principal amount
of the Outstanding Debentures, or to any suit instituted by any Holder for
the enforcement of the payment of the principal of (or premium, if any) or
interest (including any Additional Interest) on the Debentures on or after
the Maturity of the Debentures or to convert a Debenture in accordance with
Article 13. The provisions of this Section 5.14 shall be in lieu of Section
315(e) of the Trust Indenture Act, and
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such Section 315(e) of the Trust Indenture Act is hereby expressly excluded
from this Subordinated Indenture and the Debentures, as permitted by the
Trust Indenture Act.
SECTION 5.15 WAIVER OF USURY, STAY, OR EXTENSION LAWS. The
Company covenants (to the extent that it may lawfully do so) that it will not
at any time insist upon, or plead, or in any manner whatsoever claim or take
the benefit or advantage of, any usury, stay or extension law wherever
enacted, now or at any time hereafter in force, which may affect the
covenants or the performance of this Subordinated 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 6
THE TRUSTEE
SECTION 6.1 CERTAIN DUTIES AND RESPONSIBILITIES.
(a) Except during the continuance of a Debenture Event of Default,
(i) the Trustee undertakes to perform such duties and
only such duties as are specifically set forth in this
Subordinated Indenture, and no implied covenants or obligations
shall be read into this Subordinated Indenture against the
Trustee; and
(ii) in the absence of bad faith on its part, the
Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the Trustee
and conforming to the requirements of this Subordinated
Indenture, but in the case of any such certificates or opinions
which by any provisions hereof are specifically required to be
furnished to the Trustee, the Trustee shall be under a duty to
examine the same to determine whether or not they conform to
the requirements of this Subordinated Indenture.
(b) In case a Debenture Event of Default has occurred and is
continuing, the Trustee shall exercise such of the rights and powers
vested in it by this Subordinated Indenture, and use the same degree
of care and skill in their exercise, as a prudent person would
exercise or use under the circumstances in the conduct of his own
affairs.
(c) No provision of this Subordinated Indenture shall be
construed to relieve the Trustee from liability for its own negligent
action, its own negligent failure to act, or its own willful
misconduct except that:
(i) this Subsection shall not be construed to limit the
effect of Subsection (a) of this Section;
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(ii) the Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless
it shall be proved that the Trustee was negligent in
ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in
accordance with the direction of Holders pursuant to Section
5.12 relating to the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under
this Subordinated Indenture.
(d) No provision of this Subordinated Indenture shall
require the Trustee to expend or risk its own funds or otherwise incur
any financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if there
shall be reasonable grounds for believing that repayment of such funds
or adequate indemnity against such risk or liability is not reasonably
assured to it.
(e) Whether or not therein expressly so provided, every
provision of this Subordinated Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee
shall be subject to the provisions of this Section.
SECTION 6.2 NOTICE OF DEFAULTS. Within 90 days after
actual knowledge by a Responsible Officer of the Trustee of the occurrence of
any default hereunder, the Trustee shall transmit by mail to all Holders of
Debentures, as their names and addresses appear in the Securities Register,
notice of such default hereunder known to the Trustee, unless such default
shall have been cured or waived; PROVIDED, HOWEVER, that, except in the case
of a default in the payment of the principal of (or premium, if any) or
interest (including any Additional Interest) on any Debenture, the Trustee
shall be fully protected in withholding such notice if and so long as the
board of directors, the executive committee or a trust committee of directors
and/or Responsible Officers of the Trustee in good faith determines that the
withholding of such notice is in the interests of the Holders of Debentures;
PROVIDED, FURTHER, that, except in the case of any default of the character
specified in Section 5.1(c), no such notice to Holders of the Debentures
shall be given until at least 30 days after the occurrence thereof. For the
purpose of this Section, the term "DEFAULT" means any event which is, or
after notice or lapse of time or both would become, a Debenture Event of
Default.
SECTION 6.3 CERTAIN RIGHTS OF TRUSTEE. Subject to the
provisions of Section 6.1:
(a) the Trustee may conclusively rely and shall be fully
protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, Debenture or other paper
or document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(b) any request or direction of the Company mentioned herein
shall be sufficiently evidenced by a Company Request or Company Order
and any resolution of the Board of Directors may be sufficiently
evidenced by a Board Resolution;
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(c) whenever in the administration of this Subordinated
Indenture the Trustee shall deem it desirable that a matter be proved
or established prior to taking, suffering or omitting any action
hereunder, the Trustee (unless other evidence be herein specifically
prescribed) may, in the absence of bad faith on its part, conclusively
rely upon an Officers' Certificate and an Opinion of Counsel;
(d) the Trustee may consult with counsel and the advice of
such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Subordinated Indenture at
the request or direction of any of the Holders pursuant to this
Subordinated Indenture, unless such Holders shall have offered to the
Trustee reasonable security or indemnity against the costs, expenses
and liabilities which might be incurred by it in compliance with such
request or direction;
(f) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, indenture, Debenture or other paper or document,
but the Trustee in its discretion may make such inquiry or
investigation into such facts or matters as it may see fit, and, if
the Trustee shall determine to make such inquiry or investigation, it
shall be entitled to examine the books, records and premises of the
Company, personally or by agent or attorney;
(g) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents, attorneys, custodians or nominees and the Trustee
shall not be responsible for any misconduct or negligence on any part
of any agent, custodian, nominee or attorney appointed with due care
by it hereunder; and
(h) in the event that the Trustee is also acting as a Paying
Agent, Authenticating Agent, Conversion Agent, and/or Securities
Registrar hereunder, the rights and protections afforded to the
Trustee pursuant to this Article 6 shall also be afforded to such
Paying Agent, Authenticating Agent, Conversion Agent, and/or
Securities Registrar.
SECTION 6.4 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF
DEBENTURES. The recitals contained herein and in the Debentures, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of
this Subordinated Indenture or of the Debentures. The Trustee shall not be
accountable for the use or application by the Company of the Debentures or
the proceeds thereof.
SECTION 6.5 MAY HOLD DEBENTURES. The Trustee, any Paying
Agent, Securities Registrar or any other agent of the Company, in its
individual or any other capacity, may become the owner or pledgee of
Debentures and, subject to Sections 6.8 and 6.13, may otherwise deal with
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the Company and its Affiliates with the same rights it would have if it were
not Trustee, Paying Agent, Securities Registrar or such other agent.
SECTION 6.6 MONEY HELD IN TRUST. Money held by the Trustee
in trust hereunder need not be segregated from other funds except to the
extent required by law. The Trustee shall be under no liability of interest
on any money received by it hereunder except as otherwise agreed with the
Company.
SECTION 6.7 COMPENSATION AND REIMBURSEMENT. The Company
agrees:
(a) to pay to the Trustee from time to time reasonable
compensation for all services rendered by it hereunder in such amounts
as the Company and the Trustee shall agree from time to time (which
compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust);
(b) to reimburse the Trustee upon its request for all
reasonable expenses, disbursements and advances incurred or made by
the Trustee in accordance with any provision of this Subordinated
Indenture (including the reasonable compensation and the expenses and
disbursements of its agents and counsel); and
(c) to indemnify the Trustee and its officers, directors and
employees for, and to hold it harmless against, any loss, liability or
expense (including the reasonable compensation and the expenses and
disbursements of its agents and counsel) incurred without negligence
or bad faith, arising out of or in connection with the acceptance or
administration of this trust or the performance of its duties
hereunder, including the costs and expenses of defending itself
against any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder. This
Indemnification shall survive the termination of this Agreement or the
earlier resignation or removal of the Trustee.
To secure the Company's payment obligations in this Section, the
Company and the Holders agree that the Trustee shall have a lien prior to the
Debentures on all money or property held or collected by the Trustee except
assets held in trust to pay principal and premium, if any, or interest on
particular Debentures pursuant to Section 4.1(a)(ii)(B), or pursuant to any
redemption pursuant to Article 11 hereof if monies have been deposited for
such redemption and notice has been given and the Redemption Date has passed.
Such lien shall survive the satisfaction and discharge of this Subordinated
Indenture or the earlier resignation or removal of the Trustee.
When the Trustee incurs expenses or renders services after a Debenture
Event of Default specified in Section 5.1(e) or (f) occurs, the expenses and
the compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Reform Act of 1978 or a successor statute.
SECTION 6.8 DISQUALIFICATION; CONFLICTING INTERESTS. The
Trustee shall be subject to the provisions of Section 310(b) of the Trust
Indenture Act. Nothing herein shall prevent the Trustee from filing with the
Commission the application referred to in the second to last paragraph
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of Section 310(b) of the Trustee Indenture Act. The Declaration and the
Guarantee shall be deemed to be specifically described in this Subordinated
Indenture for the purposes of clause (i) of the first proviso contained in
Section 310(b) of the Trust Indenture Act.
SECTION 6.9 CORPORATE TRUSTEE REQUIRED; ELIGIBILITY. There
shall at all times be a Trustee hereunder which shall be:
(a) a corporation organized and doing business under the laws
of the United States of America or of any State, Territory or the
District of Columbia, authorized under such laws to exercise corporate
trust powers and subject to supervision or examination by Federal,
State, Territorial or District of Columbia authority, or
(b) a corporation or other Person organized and doing business
under the laws of a foreign government that is permitted to act as
Trustee pursuant to a rule, regulation or order of the Commission,
authorized under such laws to exercise corporate trust powers, and
subject to supervision or examination by authority of such foreign
government or a political subdivision thereof substantially equivalent
to supervision or examination applicable to United States
institutional trustees,
in either case having a combined capital and surplus of at least $50,000,000,
subject to supervision or examination by Federal or State authority. If such
corporation publishes reports of condition at least annually, pursuant to law
or to the requirements of the aforesaid supervising or examining authority,
then, to 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. Neither the Company nor any
Person directly or indirectly controlling, controlled by or under common
control with the Company shall serve as Trustee hereunder.
SECTION 6.10 RESIGNATION AND REMOVAL; APPOINTMENT OF
SUCCESSOR.
(a) No resignation or removal of the Trustee and no
appointment of a successor Trustee pursuant to this Article shall
become effective until the acceptance of appointment by the successor
Trustee under Section 6.11.
(b) The Trustee may resign at any time by giving written
notice thereof to the Company. If an instrument of acceptance by a
successor Trustee shall not have been delivered to the Trustee within
30 days after the giving of such notice of resignation, the resigning
Trustee may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
(c) The Trustee may be removed at any time by Act of the
Holders of a majority in principal amount of the Outstanding
Debentures, delivered to the Trustee and to the Company.
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(d) If at any time:
(i) the Trustee shall fail to comply with Section 6.8
after written request therefor by the Company or by any Holder
who has been a bona fide Holder of a Debenture for at least six
months, or
(ii) the Trustee shall cease to be eligible under
Section 6.9 and shall fail to resign after written request
therefor by the Company or by any such Holder, or
(iii) the Trustee shall become incapable of acting or
shall be adjudged as bankrupt or insolvent or a receiver of the
Trustee or of its property shall be appointed or any public
officer shall take charge or control of the Trustee or of its
property or affairs for the purpose of rehabilitation,
conservation or liquidation, then, in any such case, (A) the
Company by Board Resolution may remove the Trustee, or (B)
subject to Section 5.14, any Holder who has been a bona fide
Holder of a Debenture for at least six months may, on behalf of
himself and all other similarly situated Holders, petition any
court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
(e) If the Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of
Trustee for any cause with respect to the Debentures, the Company, by
a Board Resolution, shall promptly appoint a successor Trustee. If,
within one year after such resignation, removal or incapability, or
the occurrence of such vacancy, a successor Trustee with respect to
the Debentures shall be appointed by Act of the Holders of a majority
in principal amount of the Outstanding Debentures delivered to the
Company and the retiring Trustee, the successor Trustee so appointed
shall, forthwith upon its acceptance of such appointment, become the
successor Trustee and supersede the successor Trustee appointed by the
Company. If no successor Trustee shall have been so appointed by the
Company or the Holders and accepted appointment in the manner
hereinafter provided, any Holder who has been a bona fide Holder of a
Debenture for at least six months may, subject to Section 5.14, on
behalf of himself and all others similarly situated, petition any
court of competent jurisdiction for the appointment of a successor
Trustee.
(f) The Company shall give notice of each resignation and
each removal of the Trustee and each appointment of a successor
Trustee by mailing written notice of such event by first-class mail,
postage prepaid, to the Holders of the Debentures as their name and
addresses appear in the Securities Register. Each notice shall
include the name of the successor Trustee and the address of its
Corporate Trust Office.
SECTION 6.11 ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
(a) In case of the appointment hereunder of a successor
Trustee, every such successor Trustee so appointed shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an
instrument accepting such appointment, and thereupon the resignation
or removal of the retiring Trustee shall become effective and such
successor
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Trustee, without any further act, deed or conveyance, shall become
vested with all the rights, powers, trusts and duties of the retiring
Trustee, but, on the written 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) 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 rights, power
and trusts referred to in paragraph (a) of this Section.
(c) No successor Trustee shall accept its appointment unless
at the time of such acceptance such successor Trustee shall be
qualified and eligible under this Article.
SECTION 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 of 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
Debentures 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
Debentures so authenticated, and in case any Debentures shall not have been
authenticated, any successor to the Trustee may authenticate such Debentures
either in the name of any predecessor Trustee or in the name of such
successor Trustee, and in all cases the certificate of authentication shall
have the full force which it is provided anywhere in the Debentures or in
this Subordinated Indenture that the certificate of the Trustee shall have.
SECTION 6.13 PREFERENTIAL COLLECTION OF CLAIMS AGAINST
COMPANY. If and when the Trustee shall be or become a creditor of the
Company (or any other obligor upon the Debentures), the Trustee shall be
subject to the provisions of the Trust Indenture Act regarding the collection
of claims against the Company (or any such other obligor).
SECTION 6.14 APPOINTMENT OF AUTHENTICATING AGENT. The
Trustee may appoint an Authenticating Agent or Agents, as described and with
the powers and obligations conferred by this Section 6.14 ("AUTHENTICATING
AGENT OR AGENTS"), with respect to the Debentures which shall be authorized
to act on behalf of the Trustee to authenticate the Debentures issued upon
exchange, registration of transfer or partial redemption thereof, and
Debentures so authenticated shall be entitled to the benefits of this
Subordinated Indenture and shall be valid and obligatory for all purposes as
if authenticated by the Trustee hereunder. Wherever reference is made in
this Subordinated Indenture to the authentication and delivery of Debentures
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. Each Authenticating Agent shall be
acceptable to the Company and shall at all times be a corporation organized
and doing business
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under the laws of the United States of America, or of any State, Territory or
the District of Columbia, authorized under such laws to act as Authenticating
Agent, having a combined capital and surplus of not less than $50,000,000 and
subject to supervision or examination by Federal or State authority. If such
Authenticating Agent publishes reports of condition at least annually,
pursuant to law or to the requirements of said supervising or examining
authority, then for the purposes of this Section the combined capital and
surplus of such Authenticating Agent shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. If at any time an Authenticating Agent shall cease to be eligible
in accordance with the provisions of this Section, such Authenticating Agent
shall resign immediately in the manner and with the effect specified in this
Section.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating
Agent shall be a party, or any corporation succeeding to all or substantially
all of the corporate trust business of an Authenticating Agent shall be the
successor Authenticating Agent hereunder, PROVIDED such corporation shall be
otherwise eligible under this Section, without the execution or filing of any
paper or any further act on the part of the Trustee or the Authenticating
Agent.
An Authenticating Agent may resign at any time by giving written
notice thereof to the Trustee and to the Company. The Trustee may at any
time terminate the agency of an Authenticating Agent by giving written notice
thereof to such Authenticating Agent and to the Company. Upon receiving such
a notice of resignation or upon such a termination, or in case at any time
such Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor
Authenticating Agent which shall be acceptable to the Company and shall give
notice of such appointment in the manner provided in Section 1.6 to all
Holders of the Debentures. Any successor Authenticating Agent upon
acceptance of its appointment hereunder shall become vested with all the
rights, powers and duties of its predecessor hereunder, with like effect as
if originally named as an Authenticating Agent. No successor Authenticating
Agent shall be appointed unless eligible under the provision of this Section.
The Trustee agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services under this Section, and the
Trustee shall be entitled to be reimbursed for such payments, subject to the
provisions of Section 6.7.
If an appointment is made pursuant to this Section, the Debentures may
have endorsed thereon, in addition to the Trustee's certificate of
authentication, an alternative certificate of authentication in the following
form:
This is one of the Debentures referred to in the within mentioned
Subordinated Indenture.
---------------------------
---------------------------
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As Trustee
By:
---------------------------
As Authenticating Agent
By:
---------------------------
Authorized Officer
ARTICLE 7
HOLDERS LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 7.1 COMPANY TO FURNISH NAMES AND ADDRESSES OF
HOLDERS. The Company will furnish or cause to be furnished to the Trustee
(unless the Trustee is acting as the Securities Registrar):
(a) quarterly at least five Business Days before each
Interest Payment Date, a list, in such form as the Trustee may
reasonably require, of the names and addresses of the Holders as of
each such date; and
(b) at such other times as the Trustee may request in
writing, within 30 days after the receipt by the Company of any such
request, a list of similar form and content as of a date not more than
15 days prior to the time such list is furnished.
SECTION 7.2 PRESERVATION OF INFORMATION: COMMUNICATIONS TO
HOLDERS.
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders contained
in the most recent list furnished to the Trustee as provided in
Section 7.1 and the names and addresses of Holders received by the
Trustee in its capacity as Securities Registrar. The Trustee may
destroy any list furnished to it as provided in Section 7.1 upon
receipt of a new list so furnished.
(b) The rights of Holders to communicate with other Holders
with respect to their rights under this Subordinated Indenture or
under the Debentures, and the corresponding rights and privileges of
the Trustee, shall be as provided in the Trust Indenture Act.
(c) Every Holder of Debentures, by receiving and holding the
same, agrees with the Company and the Trustee that neither the Company
nor the Trustee nor any agent of either of them shall be held
accountable by reason of the disclosure of information as to the names
and addresses of the Holders made pursuant to the Trust Indenture Act.
SECTION 7.3 REPORTS BY TRUSTEE.
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(a) The Trustee shall transmit to Holders such reports
concerning the Trustee and its actions under this Subordinated
Indenture as may be required pursuant to the Trust Indenture Act, at
the times and in the manner provided pursuant thereto.
(b) Reports so required to be transmitted at stated
intervals of not more than 12 months shall be transmitted within 60
days after May 15 in each calendar year, commencing with May 15, 1999.
(c) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each stock
exchange or self regulatory organization of which the Trustee has
received notice by the Company upon which the Debentures are listed
and also with the Commission. The Company will notify the Trustee in
writing whenever the Debentures are listed on any stock exchange or
self-regulatory organization.
SECTION 7.4 REPORTS BY COMPANY. The Company shall file
with the Trustee and with the Commission, and transmit to Holders, such
information, documents and other reports, and such summaries thereof, as may
be required pursuant to the Trust Indenture Act at the times and in the
manner provided in the Trust Indenture Act, PROVIDED that any such
information, documents or reports required to be filed with the Commission
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of
1934 shall be filed with the Trustee within 15 days after the same is
required to be filed with the Commission. Notwithstanding that the Company
may not be required to remain subject to the reporting requirements of
Section 13 or 15(d) of the Securities Exchange Act of 1934, the Company shall
continue to file with the Commission and provide the Trustee and Holders with
the annual reports and the information, documents and other reports which are
specified in Sections 13 and 15(d) of the Securities Exchange Act of 1934.
The Company also shall comply with the other provisions of Trust Indenture
Act Section 314(a).
ARTICLE 8
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 8.1 COMPANY MAY CONSOLIDATE, ETC., ONLY ON CERTAIN
TERMS. The Company shall not consolidate with or merge into any other Person
or convey, transfer or lease its properties and assets substantially as an
entirety to any Person, and no Person shall consolidate with or merge into
the Company or convey, transfer or lease its properties and assets
substantially as an entirety to the Company, unless:
(a) in case the Company shall consolidate with or merge into
another Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, the Person formed by such
consolidation or into which the Company is merged or the Person which
acquires by conveyance or transfer, or which leases, the properties
and assets of the Company substantially as an entirety shall be a
Person organized and existing under the laws of the United States of
America or any State or the District of Columbia, and shall expressly
assume, by an indenture supplemental hereto, executed and delivered to
the Trustee, in form satisfactory to the Trustee, the due and punctual
payment of the principal of (and premium,
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if any) and interest (including any Additional Interest) on all the
Debentures and the performance of every covenant of this Subordinated
Indenture on the part of the Company to be performed or observed and
shall have provided for conversion rights in accordance with Article
13;
(b) immediately after giving effect to such transaction, no
Debenture Event of Default, and no event which, after notice or lapse
of time, or both, would become a Debenture Event of Default, shall
have happened and be continuing;
(c) such consolidation, merger, conveyance, transfer or lease
is permitted under the Declaration and Guarantee and does not give
rise to any breach or violation of the Declaration or Guarantee; and
(d) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel each stating that such
consolidation, merger, conveyance, transfer or lease and any such
supplemental indenture complies with this Article and that all
conditions precedent herein provided for relating to such transaction
have been complied with, and the Trustee, subject to Section 6.1, may
rely upon such Officers' Certificate and Opinion of Counsel as
conclusive evidence that such transaction complies with this
Section 8.1.
SECTION 8.2 SUCCESSOR CORPORATION SUBSTITUTED. Upon any
consolidation or merger by the Company with or into any other corporation, or
any conveyance, transfer or lease by the Company of its properties and assets
substantially as an entirety to any Person in accordance with Section 8.1,
the successor corporation formed by such consolidation or into which the
Company is merged or to which such conveyance, transfer or lease is made
shall succeed to, and be substituted for, and may exercise every right and
power of, the Company under this Subordinated Indenture with the same effect
as if such successor corporation had been named as the Company herein. In
the event of any such conveyance, transfer or lease the Company shall be
discharged from all obligations and covenants under the Subordinated
Indenture and the Debentures and may be dissolved and liquidated.
Such successor corporation may cause to be signed, and may issue
either in its own name or in the name of the Company, any or all of the
Debentures issuable hereunder which theretofore shall not have been signed by
the Company and delivered to the Trustee, and, upon the Company Order of such
successor corporation instead of the Company and subject to all the terms,
conditions and limitations in this Subordinated Indenture prescribed, the
Trustee shall authenticate and shall deliver any Debentures which previously
shall have been signed and delivered by the officers of the Company to the
Trustee for authentication pursuant to a Company Order and any Debentures
which such successor corporation thereafter shall cause to be signed and
delivered to the Trustee on its behalf for the purpose pursuant to such
provisions. All the Debentures so issued shall in all respects have the same
legal rank and benefit under this Subordinated Indenture as the Debentures
theretofore or thereafter issued in accordance with the terms of this
Subordinated Indenture as though all of such Debentures had been issued at
the date of the execution hereof.
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In case of any such consolidation, merger, sale, conveyance or lease,
such changes in phraseology and form may be made in the Debentures thereafter
to be issued as may be appropriate.
ARTICLE 9
SUPPLEMENTAL INDENTURES
SECTION 9.1 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF
HOLDERS. Without the consent of or notice to any Holder, the Company, when
authorized by a Board Resolution, and the Trustee, at any time and from time
to time, may enter into one or more indentures supplemental hereto, in form
satisfactory to the Trustee, for any of the following purposes:
(a) to evidence the succession of another Person to the
Company, and the assumption by any such successor of the covenants of
the Company herein and in the Debentures contained;
(b) to convey, transfer, assign, mortgage or pledge any
property to or with the Trustee or to surrender any right or power
herein conferred upon the Company;
(c) to add to covenants of the Company for the benefit of the
Holders of the Debentures or to surrender any right or power herein
conferred upon the Company;
(d) to make provision with respect to the conversion rights
of Holders pursuant to the requirements of Article 13;
(e) to add any additional Debenture Events of Default;
(f) to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other provision
herein, or to make any other provisions with respect to matters or
questions arising under this Subordinated Indenture, PROVIDED that
such action pursuant to this clause shall not materially adversely
affect the interest of the Holders of Debentures and for so long as
any of the Preferred Securities shall remain outstanding, the holders
of such Preferred Securities;
(g) to evidence and provide for the acceptance of appointment
hereunder by successor Trustee and to add to or change any of the
provisions of this Subordinated Indenture as shall be necessary to
provide for or facilitate the administration of the Trust hereunder by
more than one Trustee, pursuant to the requirements of Section 6.11(b);
(h) to comply with the requirements of the Commission in order
to effect or maintain the qualification of this Subordinated Indenture
under the Trust Indenture Act; or
(i) to make provision for transfer procedures, certification,
book-entry provisions, the form of restricted securities legends, if
any, to be placed on Debentures, and all other matters required
pursuant to Section 3.5 or otherwise necessary, desirable or
appropriate in
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connection with the issuance of Debentures to holders of Preferred
Securities in the event of a distribution of Debentures by the Trust if
a Special Event occurs and is continuing.
SECTION 9.2 SUPPLEMENTAL INDENTURES WITH CONSENT OF
HOLDERS. With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Debentures, by Act of said Holders
delivered to the Company and the Trustee, the Company, when authorized by a
Board Resolution, and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing
in any manner or eliminating any of the provisions of this Subordinated
Indenture or of modifying in any manner the rights of the Holders of the
Debentures under this Subordinated Indenture; PROVIDED, HOWEVER, that no such
supplemental indenture shall, without the consent of the Holder of each
Outstanding Debenture affected thereby,
(a) except to the extent permitted by Section 3.11 with
respect to the extension of the interest payment period of the
Debentures, change the Stated Maturity of the principal of, or any
installment of interest (including any Additional Interest) on, the
Debentures, or reduce the principal amount thereof or the rate of
interest thereon or reduce any premium payable upon the redemption
thereof, or change the place of payment where, or the coin or currency
in which, any Debenture or interest thereon is payable, or impair the
right to institute suit for the enforcement of any such payment on or
after the Maturity thereof (or, in the case of redemption, on or after
the date fixed for redemption thereof);
(b) adversely affect any right to convert or exchange any
Debenture or modify the provisions of this Subordinated Indenture with
respect to the subordination of the Debentures in a manner adverse to
such Holder;
(c) reduce the percentage in principal amount of the
Outstanding Debentures, 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
Subordinated Indenture or certain defaults hereunder and their
consequences) provided for in this Subordinated Indenture;
(d) modify any of the provisions of this Section, Section
4.1, Section 5.8, Section 5.13 or Section 10.6, except to increase any
such percentage or to provide that certain other provisions of this
Subordinated Indenture cannot be modified or waived without the
consent of the Holder of each Debenture affected thereby, or the
consent of the holders of all the Preferred Securities as the case may
be; or
(e) modify the provisions in Article 12 of this Subordinated
Indenture with respect to the subordination of Outstanding Debentures
in a manner adverse to the Holders thereof;
PROVIDED that, so long as any Preferred Securities remain outstanding (i) no
such modification may be made that adversely affects the holders of such
Preferred Securities in any material respect, no termination of this
Subordinated Indenture shall occur, and no waiver of any Debenture Event of
Default or compliance with any covenant under this Subordinated Indenture
shall be effective, without the prior consent of the holders of at least a
majority of the aggregate liquidation amount
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of such Preferred Securities then outstanding unless and until the principal
(and premium, if any) of the Debentures and all accrued and unpaid interest
(including any Additional Interest) thereon have been paid in full and (ii)
where a consent under this Subordinated Indenture would require the consent
of each Holder of Debentures, no such consent will be given by the Property
Trustee without the prior consent of each holder of the Preferred Securities.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it
shall be sufficient if such Act shall approve the substance thereof.
SECTION 9.3 EXECUTION OF SUPPLEMENTAL INDENTURES. In
executing or accepting the additional trusts created by any supplemental
indenture permitted by this Article or the modifications thereby of the trust
created by this Subordinated Indenture, the Trustee shall be entitled to
receive, and (subject to Section 6.1) shall be fully protected in
conclusively relying upon, an Officers' Certificate and an Opinion of Counsel
stating that the execution of such supplemental indenture is authorized or
permitted by this Subordinated Indenture, and that all conditions precedent
have been complied with. The Trustee may, but shall not be obligated to,
enter into any such supplemental indenture which affects the Trustee's own
rights, duties or immunities under this Subordinated Indenture or otherwise.
SECTION 9.4 EFFECT OF SUPPLEMENTAL INDENTURES. Upon the
execution of any supplemental indenture under this Article, this Subordinated
Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Subordinated Indenture for all purposes,
and every Holder of the Debentures theretofore or thereafter authenticated
and delivered hereunder shall be bound thereby.
SECTION 9.5 CONFORMITY WITH TRUST INDENTURE ACT. Every
supplemental indenture executed pursuant to this Article shall conform to the
requirements of the Trust Indenture Act as then in effect.
SECTION 9.6 REFERENCE IN DEBENTURES TO SUPPLEMENTAL
INDENTURES. Debentures 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 Debentures so modified as to conform, in the opinion of the
Trustee and the Board of Directors, to any such supplemental indenture may be
prepared and executed by the Company and authenticated and delivered by the
Trustee in exchange for Outstanding Debentures presented to the Trustee.
ARTICLE 10
COVENANTS
SECTION 10.1 PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST.
The Company covenants and agrees for the benefit of the Debentures that it
will duly and punctually pay the principal of (and
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premium, if any) and interest (including Additional Interest) on the
Debentures in accordance with the terms of the Debentures and this
Subordinated Indenture.
SECTION 10.2 MAINTENANCE OF OFFICE OR AGENCY. The Company
will maintain in the United States, an office or agency where Debentures may
be presented or surrendered for payment and an office or agency where
Debentures may be surrendered for transfer or exchange and where notices and
demands to or upon the Company in respect of the Debentures and this
Subordinated Indenture may be served. The Company initially appoints the
Trustee, acting through its Corporate Trust Office, as its agent for said
purposes. The Company will give prompt written notice to the Trustee of any
change in the location of any such office or agency. If at any time the
Company shall fail to maintain such office or agency or shall fail to furnish
the Trustee with the address thereof, such presentations, surrenders, notices
and demands may be made or served at the Corporate Trust Office of the
Trustee, and the Company hereby appoints the Trustee as its agent to receive
all such presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more other
offices or agencies where the Debentures may be presented or surrendered for
any or all of such purposes, and may from time to time rescind such
designations; PROVIDED, HOWEVER, that no such designation or rescission shall
in any manner relieve the Company of its obligation to maintain an office or
agency in the United States for such purposes. The Company will give prompt
written notice to the Trustee of any such designation and any change in the
location of any such office or agency.
SECTION 10.3 MONEY FOR DEBENTURE PAYMENTS TO BE HELD IN
TRUST. If the Company shall at any time act as its own Paying Agent with
respect to the Debentures, it will, on or before each due date of the
principal of (or premium, if any) or interest on any of the Debentures,
segregate and hold in trust for the benefit of the Persons entitled thereto a
sum sufficient to pay the principal (or 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 of its
failure so to act. Whenever the Company shall have one or more Paying
Agents, it will, on or before each due date of the principal of or interest
on the Debentures, deposit with a Paying Agent a sum sufficient to pay the
principal (or premium, if any) or interest so becoming due, such sum to be
held in trust for the benefit of the Persons entitled to such principal and
premium (if any) or interest, and (unless such Paying Agent is the Trustee)
the Company will promptly notify the Trustee of its failure so to act.
The Company will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent will:
(a) hold all sums held by it for the payment of the principal
of (or premium, if any) or interest on Debentures 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;
(b) give the Trustee notice of any default by the Company (or
any other obligor upon the Debentures) in the making of any payment of
principal (or premium, if any) or interest;
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(c) 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; and
(d) comply with the provisions of the Trust Indenture Act
applicable to it as a Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Subordinated 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 the
Company or any Paying Agent to the Trustee, such Paying Agent shall be
released from all further liability with respect to such money.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of (or premium, if
any) or interest on any Debenture and remaining unclaimed for two years after
such principal (or premium, if any) or interest has become due and payable
shall (unless otherwise required by mandatory provision of applicable escheat
or abandoned or unclaimed property law) be paid on Company Request, after all
payments owing the Trustee have been paid, to the Company, or (if then held
by the Company) shall (unless otherwise required by mandatory provision of
applicable escheat or abandoned or unclaimed property law) be discharged from
such trust; and the Holder of such Debenture 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.
SECTION 10.4 PAYMENT OF TAXES AND OTHER CLAIMS. The Company
will pay or discharge or cause to be paid or discharged, before the same
shall become delinquent, (a) all taxes, assessments and governmental charges
levied or imposed upon the Company or any Subsidiary or upon the income,
profits or property of the Company or any Subsidiary, and (b) all lawful
claims for labor, materials and supplies which, if unpaid, might by law
become a lien upon the property of the Company or any Subsidiary; PROVIDED,
HOWEVER, that the Company shall not be required to pay or discharge or cause
to be paid or discharged any such tax, assessment, charge or claim whose
amount, applicability or validity is being contested in good faith by
appropriate proceedings.
SECTION 10.5 STATEMENT AS TO COMPLIANCE. The Company shall
deliver to the Trustee, within 120 days after the end of each calendar year
of the Company an Officers' Certificate (signed by at least one of the
officers referred to in Section 314(a)(4) of the Trust Indenture Act)
covering the preceding calendar year, stating whether or not to the best
knowledge of the signers thereof the Company is in default in the
performance, observance or fulfillment of or compliance with any of the
terms, provisions, covenants and conditions of this Subordinated Indenture,
and if the Company shall be
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in default, specifying all such defaults and the nature and status thereof of
which they may have knowledge. For the purpose of this Section 10.5,
compliance shall be determined without regard to any grace period or
requirement of notice provided pursuant to the terms of this Subordinated
Indenture.
SECTION 10.6 WAIVER OF CERTAIN COVENANTS. The Company may
omit in any particular instance to comply with any covenant or condition set
forth in this Article 10, if before or after the time for such compliance the
Holders of at least a majority in principal amount of the Outstanding
Debentures, by Act of such Holders, either waive such compliance in such
instance or generally waive compliance with such covenant or condition, but
no such waiver shall extend to or affect such covenant or condition except to
the extent so expressly waived, and, until such waiver shall become
effective, the obligations of the Company in respect of any such covenant or
condition shall remain in full force and effect.
SECTION 10.7 ADDITIONAL SUMS. In the event that (a) the
Property Trustee is the Holder of all of the Outstanding Debentures, (b) a
Tax Event in respect of the Trust shall have occurred and be continuing and
(c) the Company shall not have (i) redeemed the Debentures pursuant to
Section 11.7 or 11.8 or (ii) dissolved the Trust pursuant to Section 9.2(b)
of the Declaration, the Company shall pay to the Trust (and its permitted
successors or assigns under the Declaration) for so long as the Trust (or its
permitted successor or assignee) is the registered Holder of the Debentures,
such additional amounts as may be necessary in order that the amount of
distributions (including any Additional Amounts (as defined in the
Declaration)) then due and payable by the Trust on the Preferred Securities
and Common Securities that at any time remain outstanding in accord with the
terms thereof shall not be reduced as a result of any Additional Taxes (the
"ADDITIONAL SUMS"). Whenever in this Subordinated Indenture or the
Debentures there is a reference in any context to the payment of principal of
(or premium, if any) or interest on the Debentures, such mention shall be
deemed to include mention of the payments of the Additional Sums provided for
in this paragraph to the extent that, in such context, Additional Sums are,
were or would be payable in respect thereof pursuant to the provisions of
this paragraph and express mention of the payment of Additional Sums (if
applicable) in any provisions hereof shall not be construed as excluding
Additional Sums in those provisions hereof where such express mention is not
made, PROVIDED, HOWEVER, that the extension of an interest payment period
pursuant to Section 3.11 or the Debentures shall not extend the payment of
any Additional Sums that may be due and payable during such interest payment
period.
SECTION 10.8 ADDITIONAL COVENANTS. The Company covenants
and agrees with each Holder of Debentures that so long as the Debentures are
outstanding, if (i) there shall have occurred any event of which the Company
has actual knowledge that (A) with the giving of notice or the lapse of time
or both, would constitute a Debenture Event of Default hereunder and (B) in
respect of which the Company shall not have taken reasonable steps to cure,
(ii) the Company shall be in default with respect to its payment of any
obligations under the Guarantee or (iii) the Company shall have given notice
of its selection of an Extension Period as provided herein and shall not have
rescinded such notice, or such period, or any extension thereof, shall be
continuing, then the Company shall not, and shall cause any Subsidiary not
to, (i) declare or pay dividends on, make distributions with respect to, or
redeem, purchase or acquire, or make a liquidation payment with respect to
any of its Capital Stock (except for (x) dividends or distributions in shares
of, or options, warrants or rights to subscribe for or purchase shares of its
Capital Stock and conversions or
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exchanges of Common Stock of one class for Common Stock of another class and
(y) redemptions or purchases of any rights pursuant to a rights agreement and
the issuance of Capital Stock pursuant to such rights) or (ii) make any
payments of principal, interest or premium, if any, on or repay or repurchase
or redeem any debt securities (including guarantees of indebtedness for money
borrowed) of the Company that rank PARI PASSU with or junior to the
Debentures (other than (u) any redemption, liquidation, interest, principal
or guarantee payment by the Company where the payment is made by way of
securities (including Capital Stock) that rank PARI PASSU with or junior to
the securities on which such redemption, interest, principal or guarantee
payment is being made, (v) payments under the Guarantee (as defined in the
Declaration) or the Common Securities Guarantee (as defined in the
Declaration), (w) purchases of Common Stock related to the issuance of Common
Stock under any of the Company's benefit plans for its directors, officers or
employees, (x) as a result of a reclassification of the Company's Capital
Stock or the exchange or conversion of one series or class of the Company's
Capital Stock for another series or class of the Company's Capital Stock, (y)
the purchase of fractional interests in shares of the Company's Capital Stock
pursuant to the conversion or exchange provisions of such Capital Stock or
the security being converted or exchanged and (z) redemptions or purchases of
any rights pursuant to a rights agreement and the issuance of Capital Stock
pursuant to such rights).
The Company also covenants with each Holder of the Debentures: (i)
that for so long as Preferred Securities are outstanding not to convert the
Debentures except pursuant to a notice of conversion delivered to the
Conversion Agent by a holder of Trust Securities; (ii) to maintain directly
or indirectly 100% ownership of the Common Securities of the Trust; PROVIDED,
HOWEVER, that any permitted successor of the Company hereunder may succeed to
the Company's ownership of such Common Securities; (iii) not to voluntarily
terminate, wind-up, liquidate or dissolve the Trust, except (a) in connection
with a distribution of the Debentures to the holders of Preferred Securities
in dissolution of the Trust, (b) in connection with the redemption of all
Trust Securities or (c) in connection with certain mergers, consolidations
or amalgamations permitted by the Declaration; (iv) to use commercially
reasonable efforts, consistent with the terms and provisions of the
Declaration to cause the Trust to remain a grantor trust and not as an
association taxable as a corporation for United States Federal income tax
purposes; (v) to deliver shares of Common Stock upon an election by a holder
of the Debentures to convert such Debentures into Common Stock; and (vi) to
honor all obligations relating to the conversion or exchange of the Trust
Securities into or for Common Stock.
SECTION 10.9 PAYMENT OF EXPENSES OF THE TRUST. In
connection with the offering, sale and issuance of the Debentures to the
Property Trustee and in connection with the sale of the Preferred Securities
by the Trust, the Company shall:
(a) pay for all costs, fees and expenses relating to the
offering, sale and issuance of the Securities (as defined in the
Purchase Agreement), including commissions, discounts and expenses
payable pursuant to the Purchase Agreement and compensation of the
Trustee under the Subordinated Indenture in accordance with the
provisions of Section 6.7 of the Subordinated Indenture;
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(b) be responsible for and pay for all debts and obligations
(other than with respect to the Preferred Securities) of the Trust,
pay for all costs and expenses of the Trust (including, but not
limited to, costs and expenses relating to the organization of the
Trust, the offering, sale and issuance of the Preferred Securities
(including commissions, discounts and expenses in connection
therewith), the fees and expenses of the Property Trustee and the
Delaware Trustee, the costs and expenses relating to the operation of
the Trust, including without limitation, costs and expenses of
accountants, attorneys, statistical or bookkeeping services, expenses
for printing and engraving and computing or accounting equipment,
paying agent(s), registrar(s), transfer agent(s), duplicating, travel
and telephone and other telecommunications expenses and costs and
expenses incurred in connection with the acquisition, financing, and
disposition of Trust assets); and
(c) pay any and all taxes (other than United States withholding
taxes attributable to the Trust or its assets) and all liabilities, costs
and expenses with respect to such taxes of the Trust.
ARTICLE 11
REDEMPTION OR EXCHANGE OF DEBENTURES
SECTION 11.1 ELECTION TO REDEEM; NOTICE TO TRUSTEE. The
election of the Company to redeem any Debentures shall be evidenced by or
pursuant to a Board Resolution. In case of any redemption at the election of
the Company, the Company shall, not less than 45 days prior to the date fixed
for redemption (unless a shorter notice shall be satisfactory to the
Trustee), notify the Trustee in writing of such date and of the principal
amount of Debentures to be redeemed.
SECTION 11.2 SELECTION OF DEBENTURES TO BE REDEEMED. If
less than all the Debentures are to be redeemed, the particular Debentures to
be redeemed shall be selected not more than 45 days prior to the Redemption
Date by the Trustee from the Outstanding Debentures not previously called for
redemption, by lot or by such other method as the Trustee shall deem fair and
appropriate and which may provide for the selection for redemption of a
portion of the principal amount of the Debentures Outstanding, PROVIDED that
the unredeemed portion of the principal amount of the Debentures be in an
authorized denomination (which shall not be less than the minimum authorized
denomination) for the Debentures.
The Trustee shall promptly notify the Company in writing of the
Debentures selected for partial redemption and the principal amount thereof
to be redeemed. For all purposes of this Subordinated Indenture, unless the
context otherwise requires, all provisions relating to the redemption of
Debentures shall relate, in the case of any Debenture redeemed or to be
redeemed only in part, to the portion of the principal amount of such
Debenture which has been or is to be redeemed. If the Company shall so
direct, Debentures registered in the name of the Company, any Affiliate or
any Subsidiary thereof shall not be included in the Debentures selected for
redemption.
SECTION 11.3 NOTICE OF REDEMPTION. Notice of redemption
shall be given by first-class mail, postage prepaid, mailed not later than
the thirtieth (30th) day, and not earlier than the
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sixtieth (60th) day, prior to the date fixed for redemption, to each Holder
of Debentures to be redeemed, at the address of such Holder as it appears in
the Securities Register.
With respect to Debentures to be redeemed, each notice of redemption
shall state:
(a) the Redemption Date;
(b) the redemption price at which the Debentures are to be
redeemed (the "REDEMPTION PRICE");
(c) if less than all Outstanding Debentures are to be
redeemed, the identification (and, in the case of partial redemption,
the respective principal amounts) of the particular Debentures to be
redeemed (including, if relevant, the CUSIP or ISIN number);
(d) that on the Redemption Date the Redemption Price will
become due and payable upon each such Debenture or portion thereof,
and that upon deposit with the Paying Agent interest thereon, if any,
shall cease to accrue on and after the Redemption Date;
(e) the place or places where the Debentures are to be
surrendered for payment of the redemption price at which the
Debentures are to be redeemed;
(f) that a Holder of Debentures who desires to convert
Debentures called for redemption must satisfy the requirements for
conversion contained in the Debentures, the then existing Conversion
Price, and the date and time when the option to convert shall expire;
and
(g) the record date for the determination of holders
entitled to receive payment of the Redemption Price, as provided in
Section 11.5.
Notice of redemption of Debentures to be redeemed at the election of
the Company shall be given by the Company or, at the Company's written
request, by the Trustee in the name and at the expense of the Company and
shall be irrevocable. The notice if mailed in the manner herein provided
shall be conclusively presumed to have been duly given, whether or not the
Holder receives such notice. In any case, a failure to give such notice by
mail or any defect in the notice to the Holder of any Debenture designated
for redemption as a whole or in part shall not affect the validity of the
proceedings for the redemption of any other Debenture.
SECTION 11.4 DEPOSIT OF REDEMPTION PRICE. Prior to 12:00
noon, New York City time, on the Redemption Date specified in the notice of
redemption given as provided in Section 11.3, the Company will deposit with
the Trustee or with one or more Paying Agents (or, if the Company is acting
as its own Paying Agent, segregate and hold in trust as provided in Section
4.2) an amount of money sufficient to redeem on the Redemption Date all the
Debentures so called for redemption at the applicable Redemption Price.
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If any Debenture called for redemption has been converted, any money
deposited with the Trustee or with any Paying Agent or so segregated and held
in trust for the redemption of such Debenture shall (subject to any right of
the Holder of such Debenture or any Predecessor Debenture to receive interest
as provided in the last paragraph of Section 3.7) be paid to the Company upon
Company Request or, if then held by the Company, shall be discharged from
such trust.
SECTION 11.5 DEBENTURES PAYABLE ON REDEMPTION DATE. If
notice of redemption has been given as provided in Section 11.3, the
Debentures so to be redeemed shall, on the Redemption Date, become due and
payable at the Redemption Price therein specified, including any accrued
interest (and any Additional Interest) thereon, and from and after such date
(unless the Company shall default in the payment of the Redemption Price or
any accrued interest on (including any Additional Interest)) such Debentures
shall cease to bear interest. Upon surrender of any such Debenture for
redemption in accordance with said notice, such Debenture shall be paid by
the Company at the Redemption Price, including any accrued interest (and any
Additional Interest) to the Redemption Date, PROVIDED, HOWEVER, that
installments of interest on Debentures whose Stated Maturity is on or prior
to the Redemption Date shall be payable to the Holders of such Debentures, or
one of more Predecessor Debentures, registered as such at the close of
business on the relevant Regular Record Dates or Special Record Dates, as the
case may be, according to their terms and the provisions of Section 3.7. In
the event that any date on which any Redemption Price is payable is not a
Business Day, then payment of the Redemption Price payable on such date will
be made on the next succeeding day which is a Business Day (and without any
interest or other payment in respect of any such delay), except that, if such
Business Day is in the next succeeding calendar year, such payment shall be
made on the immediately preceding Business Day, with the same force and
effect as if made on such date. Payment of the Redemption Price shall be
made to the Holders of such Debentures as they appear on the Securities
Register for the Debentures on the relevant record date, which shall be the
date which is the fifteenth (15th) day (whether or not a Business Day)
preceding such Redemption Date.
If any Debenture called for redemption shall not be so paid upon
surrender thereof for redemption, the principal and any premium shall, until
paid, bear interest from the Redemption Date at the rate prescribed therefor
in the Debenture.
SECTION 11.6 DEBENTURES REDEEMED IN PART. In the event of
any redemption in part, the Company shall not be required to (i) issue,
register the transfer of or exchange any Debenture during a period beginning
at 9:00 a.m. (New York City time) 15 Business Days before any selection for
redemption of Debentures and ending at 5:00 p.m. (Chicago time) on the
earliest date in which the relevant notice of redemption is deemed to have
been given to all Holders of Debentures to be so redeemed and (ii) register
the transfer of or exchange any Debentures so selected for redemption, in
whole or in part, except for the unredeemed portion of any Debentures being
redeemed in part.
Any Debenture which is to be redeemed only in part shall be
surrendered at the place of payment therefor (with, if the Company or the
Trustee so requires, due endorsement by, or a written instrument of transfer
in form satisfactory to the Company and the Trustee duly executed by, the
Holder thereof or his attorney duly authorized in writing), and the Company
shall execute, and the Trustee shall authenticate and make available for
delivery to the Holder of such Debenture without
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service charge, a new Debenture or Debentures, of any authorized denomination
as requested by such Holder, in aggregate principal amount equal to and in
exchange for the unredeemed portion of the principal of the Debenture so
surrendered. Each Debenture shall be subject to partial redemption only in
the amount of $50 or integral multiples thereof.
The Debentures are not entitled to the benefit of any sinking or like
fund.
SECTION 11.7 MANDATORY REDEMPTION. Upon (i) repayment at
maturity or (ii) as a result of acceleration upon the occurrence and
continuation of a Debenture Event of Default, the Company shall redeem the
Outstanding Debentures, in whole but not in part, at a redemption price equal
to 100% of the principal amount of such Debentures plus any accrued and
unpaid interest, including any Additional Interest, to the date fixed for
redemption.
SECTION 11.8 OPTIONAL REDEMPTION. (a) Except as set forth
below, on and after June 30, 2001 and subject to the next succeeding
sentence, the Company shall have the right, at any time and from time to
time, to redeem the Debentures, in whole or in part, upon notice given as set
forth in Section 11.3 during the twelve month periods beginning on June 30 in
each of the following years at the indicated Redemption Price (expressed as a
percentage of the principal amount of the Debentures being redeemed),
together with any accrued but unpaid interest on the portion being redeemed:
<TABLE>
<CAPTION>
Redemption Price Redemption Price
Year (%) of principal amount) Year (%) of principal amount)
---- ------------------------ ----- ------------------------
<S> <C> <C> <C>
2001 104.725% 2005 102.025%
2002 104.050% 2006 101.350%
2003 103.375% 2007 100.675%
2004 102.700% 2008 100.000%
</TABLE>
The Company may not redeem the Debentures in part unless all accrued
and unpaid interest has been paid in full on all outstanding Debentures for
all quarterly interest periods terminating on or prior to the giving of
notice of the Redemption Date.
(b) If a Tax Event shall occur and be continuing, the Company
shall have the right, upon not less than 30 nor more than 60 days' notice, to
redeem the Debentures in whole or in part, for cash upon the later of (i) 90
days following the occurrence of such Tax Event or (ii) June 30, 2001, at a
Redemption Price equal to the principal amount of such Debentures plus any
accrued and unpaid interest, including Additional Interest, to the date fixed
for such redemption.
(c) If at any time prior to the Conversion Expiration Date,
less than ten percent (10%) in principal amount of the Debentures originally
issued by the Company remain outstanding, such Debentures shall be
redeemable, at the option of the Company, exercisable at any time in whole
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but not in part, at a Redemption Price equal to the aggregate unpaid
principal amount thereof, and all accrued and unpaid interest (including
Additional Interest and Additional Sums, if any) due thereon to the date
fixed for redemption.
SECTION 11.9 EXCHANGE OF TRUST SECURITIES FOR DEBENTURES.
(a) At any time, the Company shall have the right to
dissolve the Trust and cause the Debentures to be distributed to the
holders of the Preferred Securities in dissolution of the Trust after
satisfaction of liabilities to creditors of the Trust as provided by
applicable law.
(b) If a Special Event in respect of the Trust shall occur
and be continuing, the Company shall give the Property Trustee notice
of the same. If a Special Event in respect of the Trust shall occur
and be continuing, the Declaration requires the Property Trustee to
direct the Conversion Agent (as defined in the Declaration) to
exchange all outstanding Trust Securities for the Debentures having a
principal amount equal to the aggregate liquidation amount of the
Trust Securities to be exchanged with accrued interest in an amount
equal to any unpaid distributions (including any Additional Amounts)
on the Trust Securities PROVIDED that, in the case of a Tax Event that
shall have occurred and be continuing, the Company shall have the
right to direct the Property Trustee that less than all, or none, of
the Trust Securities be so exchanged (i) if and for so long as the
Company shall have elected to pay any Additional Sums such that the
amounts received by holders of the Trust Securities that remain
outstanding are not reduced as a result of such Tax Event, and shall
not have revoked any such election or failed to make such payments or
(ii) if the Company shall instead elect to redeem the Debentures, in
whole or in part, in the manner set forth in Section 11.8.
ARTICLE 12
SUBORDINATION OF DEBENTURES
SECTION 12.1 DEBENTURES SUBORDINATE TO SENIOR DEBT. The
Company covenants and agrees, and each Holder of a Debenture, by its
acceptance thereof, likewise covenants and agrees, that, to the extent and in
the manner hereinafter set forth in this Article, the payment of the
principal of (and premium, if any) and interest (including any Additional
Interest) on each and all of the Debentures are hereby expressly made junior
and subordinate and subject in right of payment to the prior payment in full
of all amounts then due and payable in respect of all Senior Debt (whether
outstanding on the date hereof or hereafter created, incurred, assumed or
guaranteed), and that the subordination is for the benefit of the holders of
Senior Debt. Notwithstanding the foregoing, any and all amounts payable to
the Trustee pursuant to Section 6.7 are not subject to the provisions of
Article 12.
SECTION 12.2 PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC.
Upon any payment or distribution of assets of the Company to creditors upon
any liquidation, dissolution, winding up, reorganization, assignment for the
benefit of creditors, marshaling of assets or any bankruptcy, insolvency,
debt restructuring or similar proceeding in connection with any insolvency or
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bankruptcy proceeding of the Company (each such event, if any, herein sometimes
referred to as a "PROCEEDING"), then the holders of Senior Debt shall be
entitled to receive payment in full of principal of (and premium, if any) and
interest (including interest after the commencement of any such proceeding at
the rate specified in the applicable Senior Debt), if any, on such Senior Debt,
or provision shall be made for such payment in cash or cash equivalents or
otherwise in a manner satisfactory to the holders of Senior Debt, before the
Holders of the Debentures, are entitled to receive or retain any payment or
distribution of any kind or character, whether in cash, property or Debentures
(including any payment or distribution which may be payable or deliverable by
reason of the payment of any other Debt of the Company (including the
Debentures) subordinated to the payment of the Debentures, but not including any
payments that are made from funds on deposit pursuant to Section 4.1(a)(ii)(B)
or funds on deposit for the redemption of Debentures for which notice of
Redemption has been given and the applicable Redemption Date has passed, such
payment or distribution being hereinafter referred to as a "JUNIOR SUBORDINATED
PAYMENT"), in respect of principal of (or premium, if any) or interest
(including any Additional Interest, if any) on the Debentures or on account of
the purchase or other acquisition of Debentures by the Company or any Subsidiary
and to that end the holders of Senior Debt shall be entitled to receive, for
application to the payment thereof any payment or distribution of any kind of
character, whether in cash, property or Debentures, including any Junior
Subordinated Payment, which may be payable or deliverable in respect of the
Debentures in any such Proceeding.
In the event that, notwithstanding the foregoing provisions of this
Section, the Trustee or the Holder of any Debenture shall have received any
payment or distribution of assets of the Company of any kind or character,
whether in cash, property or Debentures, including any Junior Subordinated
Payment, before all Senior Debt is paid in full or payment thereof is provided
for in cash or cash equivalents or otherwise in a manner satisfactory to the
holders of Senior Debt, and if such fact shall, at or prior to the time of such
payment or distribution, have been made known to the Trustee or, as the case may
be, such Holder, then and in such event such payment or distribution shall be
paid over or delivered forthwith to the trustee in bankruptcy, receiver,
liquidating trustee, custodian, assignee, agent or other Person making payment
or distribution of assets of the Company for application to the payment of all
Senior Debt remaining unpaid, to the extent necessary to pay all Senior Debt in
full, after giving effect to any concurrent payment or distribution to or for
the holders of Senior Debt.
For the purposes of this Article only, the words "any payment or
distribution of any kind or character, whether in cash, property or securities"
shall not be deemed to include shares of stock of the Company, as reorganized or
readjusted, or securities of the Company or any other corporation provided for
by a plan of reorganization or readjustment which securities are subordinated in
right of payment to all then outstanding Senior Debt to substantially the same
extent as the Debentures are so subordinated as provided in this Article. The
consolidation of the Company with, or the merger of the Company into, another
Person or the liquidation or dissolution of the Company following the sale of
all or substantially all of its properties and assets as an entirety to another
Person or the liquidation or dissolution of the Company following the sale of
all or substantially all of its properties and assets as an entirety to another
Person upon the terms and conditions set forth in Article 8 shall not be deemed
a Proceeding for the purposes of this Section, if the Person formed by such
consolidation or into which the Company is merged or the Person which acquires
by sale
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such properties and assets as an entirety, as the case may be, shall, as
a part of such consolidation, merger, or sale comply with the conditions set
forth in Article 8.
SECTION 12.3 PRIOR PAYMENT TO SENIOR DEBT UPON ACCELERATION
OF DEBENTURES. In the event that the Debentures are declared due and payable
before their Maturity, then and in such event the holders of the Senior Debt
outstanding at the time the Debentures so become due and payable shall be
entitled to receive payment in full of all amounts due on or in respect of
such Senior Debt (including any amounts due upon acceleration), or provision
shall be made for such payment in cash or cash equivalents or otherwise in a
manner satisfactory to the holders of Senior Debt, before the Holders of the
Debentures are entitled to receive any payment or distribution of any kind or
character, whether in cash, properties or securities (including any Junior
Subordinated Payment) by the Company on account of the principal of (or
premium, if any) or interest (including any Additional Interest) on the
Debentures or on account of the purchase or other acquisition of Debentures
by the Company or any Subsidiary.
In the event that, notwithstanding the foregoing, the Company shall make
any payment to the Trustee or the Holder of the Debentures prohibited by the
foregoing provisions of this Section, and if such fact shall, at or prior to the
time of such payment, have been made known, as set forth in Section 12.10, to a
Responsible Officer of the Trustee or, as the case may be, such Holder, then and
in such event such payment shall be paid over and delivered forthwith to the
Company.
The provisions of this Section shall not apply to any payment with
respect to which Section 12.2 would be applicable.
SECTION 12.4 NO PAYMENT WHEN SENIOR DEBT IN DEFAULT.
(a) In the event and during the continuation of any default
in the payment of principal of (or premium, if any) or interest on any
Senior Debt, or in the event that any event of default with respect to
any Senior Debt shall have occurred and be continuing and shall have
resulted in such Senior Debt becoming or being declared due and
payable prior to the date on which it would otherwise have become due
and payable, unless and until such event of default shall have been
cured or waived or shall have ceased to exist and such acceleration
shall have been rescinded or annulled, or (b) in the event any
judicial proceeding shall be pending with respect to any such default
in payment or such event or default, then no payment or distribution
of any kind or character, whether in cash, properties or Debentures
(including any Junior Subordinated Payment) shall be made by the
Company on account of principal of (or premium, if any) or interest
(including any Additional Interest), if any, on the Debentures or on
account of the purchase or other acquisition of Debentures by the
Company or any Subsidiary other than payments made from funds on
deposit pursuant to Section 4.1(a)(ii)(B) or from funds on deposit for
the redemption of Debentures for which notice of redemption has been
given and the Redemption Date has passed.
In the event that, notwithstanding the foregoing, the Company shall make
any payment to the Trustee or the Holder of the Debentures prohibited by the
foregoing provisions of this Section, and if such fact shall, at or prior to the
time of such payment, have been made known as set forth in
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Section 12.10, to a Responsible Officer of the Trustee or, as the case may
be, such Holder, then and in such event such payment shall be paid over and
delivered forthwith to the Company.
The provisions of this Section shall not apply to any payment with
respect to which Section 12.2 would be applicable.
SECTION 12.5 PAYMENT PERMITTED IF NO DEFAULT. Nothing
contained in this Article or elsewhere in this Subordinated Indenture or in
any of the Debentures shall prevent (a) the Company, at any time except
during the pendency of any Proceeding referred to in Section 12.2 or under
the conditions described in Sections 12.3 and 12.4, from making payments at
any time of principal of (or premium, if any) or interest on the Debentures,
or (b) the application by the Trustee of any money deposited with it
hereunder to the payment of or on account of the principal of (or premium, if
any) or interest (including any Additional Interest) on the Debentures or the
retention of such payment by the Holders, if, at the time of such application
by the Trustee, a Responsible Officer of the Trustee did not have actual
knowledge that such payment would have been prohibited by the provisions of
this Article.
SECTION 12.6 SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR
DEBT. Subject to the payment in full of all Senior Debt, or the provision
for such payment in cash or cash equivalents or otherwise in a manner
satisfactory to the holders of Senior Debt, the Holders of the Debentures
shall be subrogated to the extent of the payments or distributions made to
the holders of such Senior Debt pursuant to the provisions of this Article
(equally and ratably with the holders of all indebtedness of the Company
which by its express terms is subordinated to Senior Debt of the Company to
substantially the same extent as the Debentures are subordinated to the
Senior Debt and is entitled to like rights of subrogation by reason of any
payments or distributions made to holders of such Senior Debt) to the rights
of the holders of such Senior Debt to receive payments and distributions of
cash, property and securities applicable to the Senior Debt until the
principal of (and premium, if any) and interest on the Debentures shall be
paid in full. For purposes of such subrogation, no payments or distributions
to the holders of the Senior Debt of any cash, property or securities to
which the Holders of the Debentures or the Trustee would be entitled except
for the provisions of this Article, and no payments pursuant to the
provisions of this Article to the holders of Senior Debt by Holders of the
Debentures or the Trustee, shall, as among the Company, its creditors other
than holders of Senior Debt, and the Holders of the Debentures, be deemed to
be a payment or distribution by the Company to or on account of the Senior
Debt.
SECTION 12.7 PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS.
The provisions of this Article are and are intended solely for the purpose of
defining the relative rights of the Holders of the Debentures on the one hand
and the holders of Senior Debt on the other hand. Nothing contained in this
Article or elsewhere in this Subordinated Indenture or in the Debentures is
intended to or shall (a) impair, as between the Company and the Holders of
the Debentures, the obligations of the Company, which are absolute and
unconditional, to pay to the Holders of the Debentures the principal of (and
premium, if any) and interest (including any Additional Interest) on the
Debentures as and when the same shall become due and payable in accordance
with their terms, or (b) affect the relative rights against the Company of
the Holders of the Debentures and creditors of the Company other than their
rights in relation to the holders of Senior Debt, or (c) prevent the Trustee
or the
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Holder of any Debenture from exercising all remedies otherwise permitted by
applicable law upon default under this Subordinated Indenture including, without
limitation, filing and voting claims in any Proceeding, subject to the rights,
if any, under this Article of the holders of Senior Debt to receive cash,
property and securities otherwise payable or deliverable to the Trustee or such
Holder.
SECTION 12.8 TRUSTEE TO EFFECTUATE SUBORDINATION. Each
Holder of a Debenture by his or her acceptance thereof authorizes and directs
the Trustee on his or her behalf to take such action as may be necessary or
appropriate to acknowledge or effectuate the subordination provided in this
Article and appoints the Trustee his or her attorney-in-fact for any and all
such purposes.
SECTION 12.9 NO WAIVER OF SUBORDINATION PROVISIONS. No
right of any present or future holder of any Senior Debt to enforce
subordination as herein provided shall at any time in any way be prejudiced
or impaired by any act or failure to act on the part of the Company or by any
act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Company with the terms, provisions and covenants of this
Subordinated Indenture, regardless of any knowledge thereof that any such
holder may have or be otherwise charged with.
SECTION 12.10 NOTICE TO TRUSTEE. The Company shall give
prompt written notice to the Trustee of any fact known to the Company which
would prohibit the making of any payment to or by the Trustee in respect of
the Debentures. Notwithstanding the provisions of this Article or any other
provision of this Subordinated Indenture, the Trustee shall not be charged
with knowledge of the existence of any facts which would prohibit the making
of any payment to or by the Trustee in respect of the Debentures, unless and
until the Trustee shall have received written notice thereof from the Company
or a person representing itself as a holder of Senior Debt or from any
trustee, agent or representative therefor (whether or not the facts contained
in such notice are true).
SECTION 12.11 RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF
LIQUIDATING AGENT. Upon any payment or distribution of assets of the Company
referred to in this Article, the Trustee, subject to the provisions of
Article 6, and the Holders of the Debentures shall be entitled to
conclusively rely upon any order or decree entered by any court of competent
jurisdiction in which a Proceeding is pending, or a certificate of the
trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee for
the benefit of creditors, agent or other Person making such payment or
distribution, delivered to the Trustee or to the Holders of Debentures, for
the purpose of ascertaining the Persons entitled to participate in such
payment or distribution, the holders of the Senior Debt and other
indebtedness of the Company, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article.
SECTION 12.12 TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR
DEBT. With respect to the holders of the Senior Debt of the Company, the
Trustee undertakes to perform or observe only such of its obligations and
covenants as are set forth in this Article 12, and no implied covenants or
obligations with respect to the holders of such Senior Debt shall be read
into this Subordinated Indenture against First Chicago and/or the Trustee.
First Chicago and/or the Trustee shall not be deemed to owe any fiduciary
duty to the holders of such Senior Debt and, subject to the provisions of
Section 6.3, neither the Trustee (nor First Chicago) shall be liable to the
holder of any Senior Debt
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if it shall pay over or deliver to Holders, the Company, or any other person,
money or assets to which any holder of such Senior Debt shall be entitled to
by virtue of this Article 12 or otherwise.
SECTION 12.13 RIGHTS OF TRUSTEE AS HOLDER OF SENIOR DEBT;
PRESERVATION OF TRUSTEE'S RIGHTS. The Trustee in its individual capacity
shall be entitled to all the rights set forth in this Article with respect to
any Senior Debt which may at any time be held by it, to the same extent as
any other holder of Senior Debt, and, subject to the requirements of the
Trust Indenture Act, nothing in this Subordinated Indenture shall deprive the
Trustee of any of its rights as such holder.
SECTION 12.14 ARTICLE APPLICABLE TO PAYING AGENTS. In case
at any time any Paying Agent other than the Trustee shall have been appointed
by the Company and be then acting hereunder, the term "TRUSTEE" as used in
this Article shall in such case (unless the context otherwise requires) be
construed as extending to and including such Paying Agent within its meaning
as fully for all intent and purposes as if such Paying Agent were named in
this Article in addition to or in place of the Trustee.
SECTION 12.15 CERTAIN CONVERSIONS OR EXCHANGES DEEMED
PAYMENT. For the purpose of this Article only, (a) the issuance and delivery
of junior securities upon conversion or exchange of Debentures shall not be
deemed to constitute a payment or distribution on account of the principal of
(or premium, if any) or interest (including any Additional Interest) on the
Debentures or on account of the purchase or other acquisition of Debentures,
and (b) the payment, issuance or delivery of cash (including any payments for
fractional shares), property or securities (other than junior securities)
upon conversion or exchange of a Debenture shall be deemed to constitute
payment on account of the principal of such security. For the purpose of
this Section, the term "JUNIOR SECURITIES" means (i) shares of any stock of
any class of the Company and (ii) securities of the Company which are
subordinated in right of payment to all Senior Debt which may be outstanding
at the time of issuance or delivery of such securities to substantially the
same extent as, or to a greater extent than, the Debentures are so
subordinated as provided in this Article.
ARTICLE 13
CONVERSION OF DEBENTURES
SECTION 13.1 CONVERSION RIGHTS. Subject to and upon
compliance with the provisions of this Article, the Debentures are
convertible, at the option of the Holder, at any time after 90 days following
the original issue date thereof and prior to the redemption or maturity, into
fully paid and nonassessable shares of Common Stock at an initial conversion
rate of 0.8140 shares of Common Stock for each $50 in aggregate principal
amount of Debentures (equal to a conversion price of approximately $61.425
per share of Common Stock), subject to adjustment as described in this
Article 13 (as adjusted, the "CONVERSION PRICE"). A Holder of Debentures may
convert any portion of the principal amount of the Debentures into that
number of fully paid and nonassessable shares of Common Stock (calculated as
to each conversion to the nearest 1/100th of a share) obtained by dividing
the principal amount of the Debentures to be converted by the Conversion
Price. In case a Debenture or portion thereof is called for redemption, such
conversion right in respect of the
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Debenture or portion so called shall expire at the close of business on the
Redemption Date, unless the Company defaults in making the payment due upon
redemption.
SECTION 13.2 CONVERSION PROCEDURES.
(a) In order to convert all or a portion of the Debentures, the
Holder thereof shall deliver to the Property Trustee, as conversion agent
or to such other agent appointed for such purposes (the "CONVERSION
AGENT") an irrevocable Notice of Conversion setting forth the principal
amount of Debentures to be converted, together with the name or names, if
other than the Holder, in which the shares of Common Stock should be
issued upon conversion and, if such Debentures are definitive Debentures,
surrender to the Conversion Agent the Debentures to be converted, duly
endorsed or assigned to the Company or in blank. In addition, a holder
of Preferred Securities may exercise its right under the Declaration to
convert such Preferred Securities into Common Stock by delivering to the
Conversion Agent an irrevocable Notice of Conversion setting forth the
information called for by the preceding sentence and directing the
Conversion Agent (i) to exchange such Preferred Security for a portion of
the Debentures held by the Trust (at an exchange rate of $50 principal
amount of Debentures for each Preferred Security) and (ii) to immediately
convert such Debentures, on behalf of such holder, into Common Stock
pursuant to this Article 13 and, if such Preferred Securities are in
definitive form, surrendering such Preferred Securities, duly endorsed or
assigned to the Company or in blank. So long as any Preferred Securities
are outstanding, the Trust shall not convert any Debentures except
pursuant to a Notice of Conversion delivered to the Conversion Agent by a
holder of Preferred Securities.
If a Notice of Conversion is delivered on or after the Regular
Record Date and prior to the subsequent Interest Payment Date, the Holder
of record on the Regular Record Date will be entitled to receive the
interest paid on the subsequent Interest Payment Date on the portion of
Debentures to be converted notwithstanding the conversion thereof prior
to such Interest Payment Date. Except as otherwise provided in the
immediately preceding sentence, in the case of any Debenture which is
converted, interest whose Stated Maturity is on or after the date of
conversion of such Debenture shall not be payable, and the Company shall
not make nor be required to make any other payment, adjustment or
allowance with respect to accrued but unpaid interest on the Debentures
being converted, which shall be deemed to be paid in full. Debentures
submitted for conversion prior to the expiration of conversion rights as
provided in Section 13.3 shall be deemed to have been effected
immediately prior to the close of business on the day on which the Notice
of Conversion was received (the "CONVERSION DATE") by the Conversion
Agent from the Holder or from a holder of the Preferred Securities
effecting a conversion thereof pursuant to its conversion rights under
the Declaration, as the case may be. The Person or Persons entitled to
receive Common Stock issuable upon such conversion shall be treated for
all purposes as the record holder or holders of such Common Stock as of
the Conversion Date and such Person or Persons will cease to be a record
Holder or record Holders of the Debentures on that date. As promptly as
practicable on or after the Conversion Date, the Company shall issue and
deliver at the office of the Conversion Agent, unless otherwise directed
by the Holder or holder in the Notice of Conversion, a certificate or
certificates for the number of full shares of Common
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Stock issuable upon such conversion, together with the cash payment,
if any, in lieu of any fraction of any share to the Person or Persons
entitled to receive the same. The Conversion Agent shall deliver such
certificate or certificates to such Person or Persons.
(b) The Company's delivery upon conversion of the fixed
number of shares of Common Stock into which the Debentures are
convertible (together with the cash payment, if any, in lieu of
fractional shares) shall be deemed to satisfy the Company's obligation
to pay the principal amount at Maturity of the portion of Debentures
so converted and any unpaid interest (including Additional Interest)
accrued on such Debentures at the time of such conversion.
(c) No fractional shares of Common Stock will be issued as a
result of conversion, but in lieu thereof, the Company shall pay to the
Conversion Agent a cash adjustment in an amount equal to the same
fraction of the Current Market Price with respect to such fractional
interest on the date on which the Debentures or Preferred Securities, as
the case may be, were duly surrendered to the Conversion Agent for
conversion, and the Conversion Agent in turn will make such payment, if
any, to the Holder of the Securities or the holder of the Preferred
Securities so converted.
(d) In the event of the conversion of any Debenture in part
only, a new Debenture or Debentures for the unconverted portion
thereof will be issued in the name of the Holder thereof upon the
cancellation of the Debenture converted in part in accordance with
Section 3.5.
(e) In effecting the conversion transactions described in
this Section, the Conversion Agent is acting as agent of the holders
of Preferred Securities (in the exchange of Preferred Securities for
Debentures) and as agent of the Holders of Debentures (in the
conversion of Debentures into Common Stock), as the case may be,
directing it to effect such conversion transactions. The Conversion
Agent is hereby authorized (i) to exchange Debentures held by the
Trust from time to time for Preferred Securities in connection with
the conversion of such Preferred Securities in accordance with this
Article 13 and (ii) to convert all or a portion of the Debentures into
Common Stock and thereupon to deliver such shares of Common Stock in
accordance with the provisions of this Article 13 and to deliver to
the Trust a new Debenture or Debentures for any resulting unconverted
principal amount.
(f) Except as provided in Section 2.6, all shares of Common
Stock delivered upon any conversion of Debentures shall bear a legend
substantially in the form of the legend set forth in Exhibit C to the
Declaration. Neither the Trustee nor the Conversion Agent shall have
any responsibility for the inclusion or content of any such legend on
such Common Stock.
(g) The Company shall at all times reserve and keep
available out of its authorized and unissued Common Stock, solely for
issuance upon the conversion of the Debentures, such number of shares
of Common Stock as shall from time to time be issuable upon the
conversion of all the Debentures then outstanding. Notwithstanding
the foregoing, the
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Company shall be entitled to deliver upon conversion of Debentures
shares of Common Stock reacquired and held in the treasury of the
Company (in lieu of the issuance of authorized and unissued shares of
Common Stock) so long as any such treasury shares are free and clear
of all liens, charges, security interests or encumbrances. Whenever
the Company issues shares of Common Stock upon conversion of
Debentures, and the Company has in effect at such time a stock
purchase rights agreement under which holders of Common Stock are
issued rights ("RIGHTS") entitling the holders under certain
circumstances to purchase an additional share or shares of stock, the
Company will issue, together with each such share of Common Stock,
such number of Rights (which number may be a fraction) as shall at
that time be issuable with a share of Common Stock pursuant to such
stock purchase rights agreement. Any shares of Common Stock issued
upon conversion of the Debentures shall be duly authorized, validly
issued and fully paid and nonassessable. The Conversion Agent shall
deliver the shares of Common Stock received upon conversion of the
Debentures to the converting Holder free and clear of all liens,
charges, security interests and encumbrances, except for United States
withholding taxes. The Company shall use its best efforts to obtain
and keep in force such governmental or regulatory permits or other
authorizations as may be required by law, and shall comply with all
applicable requirements as to registration or qualification of Common
Stock (and all requirements to list Common Stock issuable upon
conversion of Debentures that are at the time applicable), in order to
enable the Company to lawfully issue Common Stock upon conversion of
the Debentures and to lawfully deliver Common Stock to each Holder
upon conversion of the Debentures.
(h) The Company will pay any and all taxes that may be
payable in respect of the issue or delivery of shares of Common Stock
on conversion of Debentures. The Company shall not, however, be
required to pay any tax which may be payable in respect of any
transfer involved in the issue and delivery of shares of Common Stock
in a name other than that in which the Debentures so converted were
registered, and no such issue or delivery shall be made unless and
until the Person requesting such issue has paid to the Conversion
Agent the amount of any such tax, or has established to the
satisfaction of the Conversion Agent that such tax has been paid.
(i) Nothing in this Article 13 shall limit the requirement
of the Company to withhold taxes pursuant to the terms of the
Debentures or as set forth in this Agreement or otherwise require the
Trustee or the Company to pay any amounts on account of such
withholdings.
SECTION 13.3 EXPIRATION OF CONVERSION RIGHTS. The
conversion rights of Holders of Debentures shall expire (the "Conversion
Expiration Date") at the earlier of (i) the cancellation of the Debentures or
(ii) the close of business on the date prior to the date set for redemption
of the Debentures or Stated Maturity of the Debentures.
SECTION 13.4 CONVERSION PRICE ADJUSTMENTS. The conversion
price shall be subject to adjustment (without duplication) from time to time
as follows:
(a) In case the Company shall, while any of the Debentures are
outstanding, (i) pay a dividend or make a distribution with respect to
its Common Stock in shares of Common
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Stock, (ii) subdivide its outstanding shares of Common Stock, (iii)
combine its outstanding shares of Common Stock into a smaller number
of shares or (iv) reclassify its shares of Common Stock into shares of
Common Stock and securities other than shares of Common Stock not
constituting a Fundamental Change, then the Conversion Price and the
number and kind of shares of Common Stock and such other securities
receivable upon a conversion of Debentures in effect immediately prior
to such action shall be adjusted so that the Holder of any Debentures
thereafter surrendered for conversion shall be entitled to receive the
number of shares of Common Stock and such other securities of the
Company which such Holder would have owned immediately prior thereto
if such Debenture had been converted immediately prior thereto. An
adjustment made pursuant to this subsection (a) shall become effective
immediately after the record date in the case of a dividend or other
distribution and shall become effective immediately after the
effective date in case of a subdivision, combination or
reclassification (or immediately after the record date if a record
date shall have been established for such event). If, as a result of
an adjustment made pursuant to this subsection (a), the Holder of any
Debenture thereafter surrendered for conversion shall become entitled
to receive shares of two or more classes or series of Capital Stock of
the Company, the Board of Directors, whose determination shall be
conclusive and shall be described in a Board Resolution shall
determine the allocation of the adjusted Conversion Price between or
among shares of such classes or series of Capital Stock. In the event
that such dividend, distribution, subdivision, combination or
reclassification is not so paid or made, the Conversion Price shall
again be adjusted to be the Conversion Price which would then be in
effect if such record date had not been fixed.
(b) In case the Company shall, while any of the Debentures are
Outstanding, issue rights or warrants to all holders of its Common Stock
entitling them (for a period expiring within 45 days after the record
date mentioned below) to subscribe for or purchase shares of Common Stock
at a price per share less than the Current Market Price per share of
Common Stock on the record date mentioned below, the Conversion Price for
the Debentures shall be adjusted so that the same shall equal the price
determined by multiplying the Conversion Price in effect immediately
prior to the date of issuance of such rights or warrants by a fraction of
which the numerator shall be the number of shares of Common Stock
outstanding at the close of business on the record date mentioned below,
plus the number of shares which the aggregate offering price of the total
number of shares so offered for subscription or purchase would purchase
at such Current Market Price, and of which the denominator shall be the
number of shares of Common Stock outstanding at the close of business on
the record date mentioned below, plus the number of additional shares of
Common Stock offered for subscription or purchase. Such adjustment shall
become effective immediately after the record date for the determination
of stockholders entitled to receive such rights or warrants. For the
purposes of this subsection, the number of shares of Common Stock at any
time outstanding shall not include shares held in the treasury of the
Company. In case any rights or warrants referred to in this subsection in
respect of which an adjustment shall have been made shall expire
unexercised, within 45 days after the same shall have been distributed or
issued by the Company, the Conversion Price shall be readjusted at the
time of such expiration to the Conversion Price that would have been in
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effect if no adjustment had been made on account of the distribution or
issuance of such expired rights or warrants.
(c) Subject to the last sentence of this subsection (c), in
case the Company shall, by dividend or otherwise, distribute to all
holders of its Common Stock evidences of its indebtedness, shares of
any class or series of Capital Stock, cash or assets (including
securities, but excluding any rights or warrants referred to in
subsection (b), any dividend or distribution paid exclusively in cash
and any dividend or distribution referred to in Section 13.4(a)), the
Conversion Price shall be reduced so that the same shall equal the
price determined by multiplying the Conversion Price in effect
immediately prior to the close of business on the date fixed for the
determination of stockholders entitled to such distribution (the
"REFERENCE DATE") by a fraction of which the numerator shall be the
Current Market Price per share of the Common Stock on the Reference
Date less the fair market value (as determined in good faith by the
Board of Directors, whose determination shall be conclusive and
described in a Board Resolution), on the Reference Date, of the
portion of the evidences of indebtedness, shares of Capital Stock,
cash and assets so distributed applicable to one share of Common Stock
and the denominator shall be such Current Market Price per share of
the Common Stock, such reduction to become effective immediately prior
to the opening of business on the day following the Reference Date.
In the event that such dividend or distribution is not so paid or
made, the Conversion Price shall again be adjusted to be the
Conversion Price which would then be in effect if such dividend or
distribution had not occurred. For purposes of this subsection (c),
any dividend or distribution that includes shares of Common Stock or
rights or warrants to subscribe for or purchase shares of Common Stock
shall be deemed instead to be (i) a dividend or distribution of the
evidences of indebtedness, shares of Capital Stock, cash or assets
other than such shares of Common Stock or such rights or warrants
(making any Conversion Price reduction required by this subparagraph
(c)) immediately followed by (ii) a dividend or distribution of such
shares of Common Stock or such rights or warrants (making any further
Conversion Price reduction required by subsection (a) or (b)), except
any shares of Common Stock included in such dividend or distribution
shall not be deemed outstanding for purposes of computing any
adjustment of the Conversion Price in subsection (a).
(d) In case the Company shall pay or make a dividend or other
distribution on its Common Stock exclusively in cash (excluding all (i)
regular quarterly cash dividends that do not exceed the per share amount
of the immediately preceding regular quarterly cash dividend (as adjusted
to reflect any of the events referred to in Sections 13.4(a), 13.4(b) or
13.4(c)) and (ii) regular quarterly cash dividends if the annualized
amount thereof per share of Common Stock does not exceed 12.5% of the
Current Market Price per share of the Common Stock on the Trading Day
immediately preceding the date of declaration of such dividend), the
Conversion Price shall be reduced so that the same shall equal the price
determined by multiplying the Conversion Price in effect immediately
prior to the effectiveness of the Conversion Price reduction contemplated
by this subsection (d) by a fraction, of which the numerator shall be the
Current Market Price per share of the Common Stock on the date fixed for
the payment of such distribution less the amount of cash so distributed
(excluding that portion of such distribution that does not exceed 12.5%
of the
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Current Market Price per share, determined as provided above)
applicable to one share of Common Stock and of which the denominator
shall be such Current Market Price per share of the Common Stock, such
reduction to become effective immediately prior to the opening of
business on the day following the date fixed for the payment of such
distribution; provided, however, that in the event the portion of the
cash so distributed applicable to one share of Common Stock is equal
to or greater than the Current Market Price per share of the Common
Stock on the record date mentioned above (excluding that portion of
such distribution that does not exceed 12.5% of the Current Market
Price per share, determined as provided above), in lieu of the
foregoing adjustment adequate provision shall be made so that each
Holder of Debentures shall have the right to receive upon conversion
the amount of cash such Holder would have received had such Holder
converted such Debenture(s) immediately prior to the record date for
the distribution of the cash (less that portion of such distribution
that does not exceed 12.5% of the Current Market Price per share,
determined as provided above). In the event that such dividend or
distribution is not so paid or made, the Conversion Price shall again
be adjusted to be the Conversion Price which would then be in effect
if such record date had not been fixed.
(e) In case a tender or exchange offer (other than an odd-lot
offer) made by the Company or any Subsidiary of the Company for all or
any portion of the Common Stock shall expire and such tender or exchange
offer shall involve the payment by the Company or such Subsidiary of
consideration per share of Common Stock having a fair market value (as
determined in good faith by the Board of Directors, whose determination
shall be conclusive and described in a Board Resolution) at the last time
(the "Expiration Time") tenders or exchanges may be made pursuant to such
tender or exchange offer as it shall have been amended) that exceeds 110%
of the Current Market Price per share of the Common Stock on the Trading
Day next succeeding the Expiration Time, the Conversion Price shall be
reduced so that the same shall equal the price determined by multiplying
the Conversion Price in effect immediately prior to the effectiveness of
the Conversion Price reduction contemplated by this subsection (e) by a
fraction, of which the numerator shall be the number of shares of Common
Stock outstanding (including any shares tendered or exchanged in such
offer) at the Expiration Time (including the Purchased Shares, as defined
below) multiplied by the Current Market Price per share of the Common
Stock on the Trading Day next succeeding the Expiration Time and of which
the denominator shall be the sum of (x) the fair market value (determined
as aforesaid) of the aggregate consideration payable to stockholders
based on the acceptance (up to any maximum specified in the terms of the
tender or exchange offer) of all shares validly tendered or exchanged and
not withdrawn as of the Expiration Time (the shares deemed so accepted,
up to any such maximum, being referred to as the "Purchased Shares")
(excluding that portion of such consideration that does not exceed 110%
of the Current Market Price per share of the Common Stock on the Trading
Day next succeeding the Expiration Time) and (y) the product of the
number of shares of Common Stock outstanding (less any Purchased Shares)
at the Expiration Time and the Current Market Price per share of the
Common Stock on the Trading Day next succeeding the Expiration Time, such
reduction to become effective immediately prior to the opening of
business on the day following the Expiration Time. In the event that no
shares are validly accepted in such tender or exchange offer, the
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Conversion Price shall again be adjusted to be the Conversion Price which
would then be in effect if such record date had not been fixed.
(f) The Company shall have the right to reduce from time to
time the Conversion Price by any amount selected by the Company (and
determined by the Company's Board to be in its best interest) for any
period of at least 20 days, PROVIDED, that Company shall give at least
15 days' written notice of such reduction to the Trustee and the
Property Trustee. The Company may, at its option, make such
reductions in the Conversion Price, in addition to those set forth
above in Section 13.4(a), as the Board of Directors deems advisable to
avoid or diminish any income tax to holders of Common Stock resulting
from any dividend or distribution of stock (or rights to acquire
stock) or from any event treated as such for United States Federal
income tax purposes.
(g) Notwithstanding anything to the contrary in this Section
13.4, no adjustment of the Conversion Price will be made upon the
issuance of any shares of Common Stock (or securities convertible or
exchangeable for Common Stock), except as specifically provided above,
including pursuant to any present or future plan providing for the
reinvestment of dividends or interest payable on securities of the
Company and the investment of additional optional amounts in shares of
Common Stock under any such plan, or the issuance of any shares of
Common Stock or options or rights to purchase such shares pursuant to
any present or future employee benefit plan or program of the Company
or pursuant to any option, warrant, right, or exercisable,
exchangeable or convertible security which does not constitute an
issuance to all holders of Common Stock or class thereof of rights or
warrants entitling holders of such rights or warrants to subscribe for
or purchase Common Stock at less than the Current Market Price.
Further, such issuances shall not be deemed to constitute an issuance
of Common Stock or exercisable, exchangeable or convertible securities
by the Company to which any of the adjustment provisions described
above applies. There shall also be no adjustment of the Conversion
Price in case of the issuance of any stock (or securities convertible
into or exchangeable for stock) of the Company except as specifically
described in this Article 13. No adjustment in the Conversion Price
will be required unless such adjustment would require an increase or
decrease of at least 1% of the Conversion Price, but any adjustment
that would otherwise be required to be made shall be carried forward
and taken into account in a subsequent adjustment.
(h) If any action would require adjustment of the Conversion
Price pursuant to more than one of the provisions described above,
only one adjustment shall be made and such adjustment shall be the
amount of adjustment that has the highest absolute value to the Holder
of the Debentures.
SECTION 13.5 FUNDAMENTAL CHANGE.
(a) In the event that the Company is a party to any transaction
(including, without limitation, a merger other than a merger that does
not result in a reclassification, conversion, exchange or cancellation of
Common Stock), consolidation, continuance, sale of all or substantially
all of the assets of the Company, recapitalization, holding company
78
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reorganization (whether pursuant to Section 251(g) of the Delaware
General Corporation Law or otherwise) or reclassification of Common Stock
(other than a change in par value, or from par value to no par value, or
from no par value to par value or as a result of a subdivision or
combination of Common Stock) or any compulsory share exchange (each of
the foregoing being referred to as a "TRANSACTION"), in each case, as a
result of which shares of Common Stock shall be converted into the right
to receive, or shall be exchanged for, (i) in the case of any Transaction
other than a Transaction involving a Stock Fundamental Change (and
subject to funds being legally available for such purpose under
applicable law at the time of such conversion), securities, cash or other
property, each Debenture shall thereafter be convertible into the kind
and, in the case of a Transaction which does not involve a Fundamental
Change, amount of securities, cash and other property receivable upon the
consummation of such Transaction by a holder of that number of shares of
Common Stock into which a Debenture was convertible immediately prior to
such Transaction, or (ii) in the case of a Transaction involving a Stock
Fundamental Change (and subject to funds being legally available for such
purpose under applicable law at the time of such conversion), securities,
cash or other property, each Debenture shall thereafter be convertible
(in the manner described herein) into Common Stock of the kind received
by holders of Common Stock (but in each case after giving effect to any
adjustment discussed in subsections (b) and (c) relating to a Fundamental
Change if such Transaction constitutes a Fundamental Change). The
Holders of Debentures will have no voting rights with respect to any
Transaction described in this section.
(b) If any Fundamental Change occurs, then the Conversion
Price in effect will be adjusted immediately after such Fundamental
Change as described in paragraph (c) below. In addition, in the event
of a Stock Fundamental Change, each Debenture shall be convertible
solely into common stock of the kind received by holders of Common
Stock as a result of such Stock Fundamental Change.
(c) The Conversion Price in the case of any Transaction
involving a Fundamental Change will be adjusted immediately after such
Fundamental Change:
(i) in the case of a Non-Stock Fundamental Change, the
Conversion Price immediately following such Non-Stock Fundamental
Change will be the lower of (A) the Conversion Price in effect
immediately prior to such Non-Stock Fundamental Change (after
giving effect to any other prior adjustments), and (B) the result
obtained by multiplying the greater of the Applicable Price and
the then applicable Reference Market Price by a fraction of which
the numerator will be 100 and of which the denominator will be an
amount based upon the date such Non-Stock Fundamental Change
occurs. For the 12-month period beginning June 30, 1998 (and
during the period from June 9, 1998 to June 30, 1998), the
denominator used in the immediately preceding sentence will be
106.75%, and such denominator will decrease by 0.675% during each
successive 12-month period, provided that in no event shall the
denominator be less than 100%; and
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<PAGE>
(ii) in the case of a Stock Fundamental Change, the
Conversion Price immediately following such Stock Fundamental
Change will be the Conversion Price in effect immediately prior to
such Stock Fundamental Change (after giving effect to any other
prior adjustments) as adjusted by multiplying such Conversion
Price by a fraction, of which the numerator will be the Purchaser
Stock Price and of which the denominator will be the Applicable
Price; provided, however, that in the event of a holding company
reorganization of the Company (whether effected in accordance with
Section 251(g) of the Delaware General Corporation Law or
otherwise) or in the event of a Stock Fundamental Change in which
(A) 100% of the value of the consideration received by a holder of
Common Stock is Common Stock of the successor, acquiror or other
third party (and cash, if any, is paid only with respect to any
fractional interests in such Common Stock resulting from such
Stock Fundamental Change) and (B) all of the Common Stock will
have been exchanged for, converted into, or acquired for Common
Stock (and cash with respect to fractional interests) of the
successor, acquiror, or other third party, the Conversion Price
immediately following such Stock Fundamental Change will be the
Conversion Price in effect immediately prior to such Stock
Fundamental Change as adjusted by multiplying such Conversion
Price by a fraction, of which the numerator will be one and the
denominator will be the number of shares of Common Stock of the
holding company, successor, acquiror or other third party received
by a holder of one share of Common Stock as a result of such Stock
Fundamental Change.
SECTION 13.6 NOTICE OF ADJUSTMENTS OF CONVERSION PRICE.
Whenever the Conversion Price is adjusted as herein provided:
(a) the Company shall compute the adjusted conversion price and
shall prepare a certificate signed by the Chief Financial Officer or the
Treasurer of the Company setting forth the adjusted conversion price and
showing in reasonable detail the facts upon which such adjustment is
based, and such certificate shall forthwith be filed with the Trustee,
the Conversion Agent and the transfer agent for the Preferred Securities
and the Debentures; and
(b) a notice stating the Conversion Price has been adjusted and
setting forth the adjusted Conversion Price shall as soon as practicable
be mailed by the Company to all record holders of Preferred Securities
and the Debentures at their last addresses as they appear upon the stock
transfer books of the Company and the Trust and the Securities Registrar.
SECTION 13.7 PRIOR NOTICE OF CERTAIN EVENTS. In case:
(a) the Company shall (i) declare any dividend (or any other
distribution) on its Common Stock, other than (A) a dividend payable in
shares of Common Stock or (B) a dividend payable in cash that would not
require an adjustment pursuant to Section 13.4(c) or (d) or (ii)
authorize a tender or exchange offer that would require an adjustment
pursuant to Section 13.4(e);
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(b) the Company shall authorize the granting to all holders
of Common Stock of rights or warrants to subscribe for or purchase any
shares of stock of any class or series or of any other rights or
warrants;
(c) of any reclassification of Common Stock (other than a
subdivision or combination of the outstanding Common Stock, or a change
in par value, or from par value to no par value, or from no par value to
par value), or of any consolidation or merger to which the Company is a
party and for which approval of stockholders of the Company shall be
required, or of the sale or transfer of all or substantially all of the
assets of the Company or of any compulsory share exchange whereby Common
Stock is converted into other securities, cash or other property; or
(d) of the voluntary or involuntary dissolution, liquidation or
winding up of the Company;
then the Company shall (A) if any Preferred Securities are outstanding under the
Declaration, cause to be filed with the transfer agent for the Preferred
Securities, and shall cause to be mailed to the holders of record of the
Preferred Securities, at their last addresses as they shall appear upon the
stock transfer books of the Trust or (B) shall cause to be mailed to all Holders
at their last addresses as they shall appear in the Security Register, at least
15 days prior to the applicable record or effective date hereinafter specified,
a notice stating (x) the date on which a record (if any) is to be taken for the
purpose of such dividend, distribution, rights or warrants or, if a record is
not to be taken, the date as of which the holders of Common Stock of record to
be entitled to such dividend, distribution, rights or warrants are to be
determined or (y) the date on which such reclassification, consolidation,
merger, sale, transfer, share exchange, dissolution, liquidation or winding up
is expected to become effective, and the date as of which it is expected that
holders of Common Stock of record shall be entitled to exchange their shares of
Common Stock for securities, cash or other property deliverable upon such
reclassification, consolidation, merger, sale, transfer, share exchange,
dissolution, liquidation or winding up (but no failure to mail such notice or
any defect therein or in the mailing thereof shall affect the validity of the
corporate action required to be specified in such notice).
SECTION 13.8 CERTAIN ADDITIONAL RIGHTS. In case the Company
shall, by dividend or otherwise, declare or make a distribution on its Common
Stock referred to in Section 13.4(c) or 13.4(d) (including, without
limitation, dividends or distributions referred to in the last sentence of
Section 13.4(c)), the Holders of the Debentures, upon the conversion thereof
subsequent to the close of business on the date fixed for the determination
of stockholders entitled to receive such distribution and prior to the
effectiveness of the Conversion Price adjustment in respect of such
distribution, shall also be entitled to receive for each share of Common
Stock into which the Debentures are converted, the portion of the shares of
Common Stock, rights, warrants, evidences of indebtedness, shares of capital
stock, cash and assets so distributed applicable to one share of Common
Stock; PROVIDED, HOWEVER, that, at the election of the Company (whose
election shall be evidenced by a resolution of the Board of Directors) with
respect to all Holders so converting, the Company may, in lieu of
distributing to such Holder any portion of such distribution not consisting
of cash or securities of the Company, pay such Holder an amount in cash equal
to the fair market
81
<PAGE>
value thereof (as determined in good faith by the Board of Directors, whose
determination shall be conclusive and described in a resolution of the Board
of Directors). If any conversion of Debentures described in the immediately
preceding sentence occurs prior to the payment date for a distribution to
holders of Common Stock which the Holder of Debentures so converted is
entitled to receive in accordance with the immediately preceding sentence,
the Company may elect (such election to be evidenced by a resolution of the
Board of Directors) to distribute to such Holder a due bill for the shares of
Common Stock, rights, warrants, evidences of indebtedness, shares of capital
stock, cash or assets to which such Holder is so entitled, PROVIDED, that
such due bill (i) meets any applicable requirements of the principal national
securities exchange or other market on which Common Stock is then traded and
(ii) requires payment or delivery of such shares of Common Stock, rights,
warrants, evidences of indebtedness, shares of capital stock, cash or assets
no later than the date of payment or delivery thereof to holders of shares of
Common Stock receiving such distribution.
SECTION 13.9 RESTRICTIONS ON COMMON STOCK ISSUABLE UPON
CONVERSION.
(a) Shares of Common Stock to be issued upon conversion of a
Debenture in respect of Preferred Securities shall bear such restrictive
legends as the Company may provide in accordance with applicable law.
(b) If shares of Common Stock to be issued upon conversion of a
Debenture in respect of Preferred Securities are to be registered in a
name other than that of the Holder of such Preferred Security, then the
Person in whose name such shares of Common Stock are to be registered
must deliver to the Conversion Agent a certificate satisfactory to the
Company and signed by such Person, as to compliance with the restrictions
on transfer applicable to such Preferred Security. Neither the Trustee
nor any Conversion Agent or Registrar shall be required to register in a
name other than that of the Holder shares of Common Stock issued upon
conversion of any such Debenture in respect of such Preferred Securities
not so accompanied by a properly completed certificate.
SECTION 13.10 TRUSTEE NOT RESPONSIBLE FOR DETERMINING
CONVERSION PRICE OR ADJUSTMENTS.
Neither the Trustee nor any Conversion Agent shall at any time be under
any duty or responsibility to any Holder of any Debenture or to any holder of a
Preferred Security to determine whether any facts exist which may require any
adjustment of the Conversion Price, or with respect to the nature or extent of
any such adjustment when made, or with respect to the method employed, or herein
or in any supplemental indenture provided to be employed, in making the same.
Neither the Trustee nor any Conversion Agent shall be accountable with respect
to the validity or value (or the kind of account) of any shares of Common Stock
or of any securities or property, which may at any time be issued or delivered
upon the conversion of any Debenture; and neither the Trustee nor any Conversion
Agent makes any representation with respect thereto. Neither the Trustee nor
any Conversion Agent shall be responsible for any failure of the Company to make
any cash payment or to issue, transfer or deliver any shares of Common Stock or
stock certificates or other securities or property upon the surrender of any
Debenture for the purpose of conversion, or, except as
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expressly herein provided, to comply with any of the covenants of the Company
contained in Article 10 or this Article 13.
* * * * *
83
<PAGE>
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Subordinated
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.
TOWER AUTOMOTIVE, INC.
By: /s/ Anthony A. Barone
-----------------------------------
Name: Anthony A. Barone
Title: Vice President and Chief
Financial Officer
THE FIRST NATIONAL BANK OF CHICAGO,
as Trustee
By: /s/ Victoria Y. Douyon
----------------------------------
Name: Victoria Y. Douyon
Title: Vice President
84
<PAGE>
---------------------------------------------------------
GUARANTEE AGREEMENT
Tower Automotive, Inc.
and
The First National Bank of Chicago
Relating to the Preferred Securities of
Tower Automotive Capital Trust
Dated as of June 9, 1998
---------------------------------------------------------
<PAGE>
CROSS REFERENCE TABLE *
<TABLE>
<CAPTION>
SECTION OF TRUST SECTION OF
INDENTURE ACT OF GUARANTEE
1939, AS AMENDED AGREEMENT
- ---------------- ----------
<S> <C>
310(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.1(a)
310(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4.1(c), 2.8
310(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
311(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2(b)
311(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2(b)
311(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
312(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2(a)
312(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2(b)
313. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.3
314(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.4
314(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
314(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.5
314(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
314(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1.1, 2.5, 3.2
314(f) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3.2
315(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.1(d)
315(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.7
315(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3.1
315(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.1(d)
316(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1.1, 2.6, 5.4
316(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5.3
317(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
317(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
318(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1(b)
318(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.1
318(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1(a)
</TABLE>
- -----------------------
(*) This Cross-Reference Table does not constitute part of the
Guarantee Agreement and shall not affect the interpretation of
any of its terms or provisions.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
ARTICLE 1
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
SECTION 1.1 DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . 2
ARTICLE 2
TRUST INDENTURE ACT . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 2.1 TRUST INDENTURE ACT; APPLICATION . . . . . . . . . . . . . . 4
SECTION 2.2 LIST OF HOLDERS. . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 2.3 REPORTS BY THE GUARANTEE TRUSTEE . . . . . . . . . . . . . . 5
SECTION 2.4 PERIODIC REPORTS TO GUARANTEE TRUSTEE. . . . . . . . . . . . 5
SECTION 2.5 EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT . . . . . . 5
SECTION 2.6 EVENTS OF DEFAULT; WAIVER. . . . . . . . . . . . . . . . . . 5
SECTION 2.7 EVENT OF DEFAULT; NOTICE . . . . . . . . . . . . . . . . . . 5
SECTION 2.8 CONFLICTING INTERESTS. . . . . . . . . . . . . . . . . . . . 6
ARTICLE 3
POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE. . . . . . . . . . . . 6
SECTION 3.1 POWERS AND DUTIES OF THE GUARANTEE TRUSTEE . . . . . . . . . 6
SECTION 3.2 CERTAIN RIGHTS OF GUARANTEE TRUSTEE. . . . . . . . . . . . . 7
SECTION 3.3 INDEMNITY. . . . . . . . . . . . . . . . . . . . . . . . . . 9
ARTICLE 4
GUARANTEE TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 4.1 GUARANTEE TRUSTEE; ELIGIBILITY . . . . . . . . . . . . . . . 9
SECTION 4.2 APPOINTMENT, REMOVAL AND RESIGNATION OF THE GUARANTEE
TRUSTEE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10
ARTICLE 5
GUARANTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
SECTION 5.1 GUARANTEE. . . . . . . . . . . . . . . . . . . . . . . . . .11
SECTION 5.2 WAIVER OF NOTICE AND DEMAND. . . . . . . . . . . . . . . . .11
SECTION 5.3 OBLIGATIONS NOT AFFECTED . . . . . . . . . . . . . . . . . .11
SECTION 5.4 RIGHTS OF HOLDERS. . . . . . . . . . . . . . . . . . . . . .12
SECTION 5.5 GUARANTEE OF PAYMENT . . . . . . . . . . . . . . . . . . . .12
SECTION 5.6 SUBROGATION. . . . . . . . . . . . . . . . . . . . . . . . .12
SECTION 5.7 INDEPENDENT OBLIGATIONS. . . . . . . . . . . . . . . . . . .13
i
<PAGE>
ARTICLE 6
COVENANTS AND SUBORDINATION . . . . . . . . . . . . . . . . . . . . . . .13
SECTION 6.1 SUBORDINATION. . . . . . . . . . . . . . . . . . . . . . . .13
SECTION 6.2 CERTAIN COVENANTS OF THE GUARANTOR . . . . . . . . . . . . .13
ARTICLE 7
TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14
SECTION 7.1 TERMINATION. . . . . . . . . . . . . . . . . . . . . . . . .14
ARTICLE 8
MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15
SECTION 8.1 SUCCESSORS AND ASSIGNS . . . . . . . . . . . . . . . . . . .15
SECTION 8.2 AMENDMENTS . . . . . . . . . . . . . . . . . . . . . . . . .15
SECTION 8.3 NOTICES. . . . . . . . . . . . . . . . . . . . . . . . . . .15
SECTION 8.4 BENEFIT. . . . . . . . . . . . . . . . . . . . . . . . . . .16
SECTION 8.5 INTERPRETATION . . . . . . . . . . . . . . . . . . . . . . .16
SECTION 8.6 GOVERNING LAW. . . . . . . . . . . . . . . . . . . . . . . .17
</TABLE>
ii
<PAGE>
GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT, dated as of June 9, 1998, is executed and
delivered by Tower Automotive, Inc., a Delaware corporation (the
"Guarantor"), and The First National Bank of Chicago, a national banking
association, as trustee (the "Guarantee Trustee"), for the benefit of the
Holders (as defined herein) from time to time of the Preferred Securities (as
defined herein) of Tower Automotive Capital Trust, a Delaware statutory
business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of Trust (the
"Declaration"), dated as of June 9, 1998, among the Trustees named therein,
the Guarantor, as Depositor, and the Holders from time to time of undivided
beneficial interests in the assets of the Issuer, the Issuer is issuing
5,175,000 of its 6 3/4% Convertible Trust Preferred Securities (liquidation
preference $50 per preferred security) (the "Preferred Securities")
representing preferred undivided beneficial interests in the assets of the
Issuer and having the terms set forth in the Declaration;
WHEREAS, the Preferred Securities will be issued by the Issuer and the
proceeds thereof, together with the proceeds from the issuance of the
Issuer's Common Securities (as defined herein), will be used to purchase the
Debentures (as defined in the Declaration) of the Guarantor which will be
deposited with The First National Bank of Chicago, as Property Trustee under
the Declaration, as trust assets;
WHEREAS, as incentive for the Holders to purchase Preferred
Securities, the Guarantor desires irrevocably and unconditionally to agree,
to the extent set forth herein, to pay to the Holders of the Preferred
Securities the Guarantee Payments (as defined herein) and to make certain
other payments on the terms and conditions set forth herein; and
WHEREAS, the Guarantor is also executing and delivering a guarantee
agreement (the "Common Securities Guarantee") in substantially identical
terms to this Guarantee for the benefit of the holders of the Common
Securities (as defined herein), except that if an event of default (as
defined in the Subordinated Indenture (as defined herein)), has occurred and
is continuing, the rights of holders of the Common Securities to receive
Guarantee Payments (as defined in the Common Securities Guarantee) under the
Common Securities Guarantee shall be subordinated to the rights of Holders of
Preferred Securities to receive Guarantee Payments (as defined herein) under
this Guarantee.
NOW, THEREFORE, in consideration of the purchase by each Holder of
Preferred Securities, which purchase the Guarantor hereby agrees shall
benefit the Guarantor, the Guarantor executes and delivers this Guarantee
Agreement for the benefit of the Holders from time to time of the Preferred
Securities.
1
<PAGE>
ARTICLE 1
DEFINITIONS
SECTION 1.1 DEFINITIONS. As used in this Guarantee
Agreement, the terms set forth below shall, unless the context otherwise
requires, have the following meanings. Capitalized or otherwise defined
terms used but not otherwise defined herein shall have the meanings assigned
to such terms in the Declaration as in effect on the date hereof.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct common control with
such specified Person, provided, however, that an Affiliate of the Guarantor
shall not be deemed to include the Issuer. For the purposes of this
definition, "control" when used with respect to any specified Person means
the power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract
or otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Common Securities" means the securities representing common
beneficial interests in the assets of the Issuer.
"Common Stock" shall mean the Common Stock, par value $0.01 per share,
of the Guarantor.
"Event of Default" means a default by the Guarantor on any of its
payment or other obligations under this Guarantee Agreement; provided,
however, that except with respect to a default in payment of any Guarantee
Payments, the Guarantor shall have received written notice of default and
shall not have cured such default within 60 days after receipt of such notice.
"Guarantee Payments" means the following payments or distributions,
without duplication, with respect to the Preferred Securities, to the extent
not paid or made by or on behalf of the Issuer: (i) any accumulated and
unpaid Distributions (as defined in the Declaration) required to be paid on
the Preferred Securities, to the extent the Issuer shall have funds on hand
available therefor at such time, (ii) the redemption price, including all
accrued and unpaid Distributions to the date of redemption (the "Redemption
Price"), with respect to the Preferred Securities called for redemption by
the Issuer to the extent the Issuer shall have funds on hand available
therefor, and (iii) upon a voluntary or involuntary dissolution of the
Issuer, unless Debentures are distributed to the Holders, the lesser of (a)
the aggregate of the liquidation preference of $50 per Preferred Security
plus accrued and unpaid Distributions on the Preferred Securities to the date
of payment to the extent the Issuer shall have funds on hand available to
make such payment and (b) the amount of assets of the Issuer remaining
available for distribution to Holders in dissolution of the Issuer (in either
case, the "Stockholder Distribution").
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"Guarantee Trustee" means The First National Bank of Chicago, until a
Successor Guarantee Trustee has been appointed and has accepted such
appointment pursuant to the terms of this Guarantee Agreement and thereafter
means each such Successor Guarantee Trustee.
"Holder" means any holder, as registered on the books and records of
the Issuer, of any Preferred Securities; PROVIDED, HOWEVER, that in
determining whether the holders of the requisite percentage of Preferred
Securities have given any request, notice, consent or waiver hereunder,
"Holder" shall not include the Guarantor, the Guarantee Trustee or any
Affiliate of the Guarantor or the Guarantee Trustee.
"List of Holders" has the meaning specified in Section 2.2 (a).
"Majority in Liquidation Preference of the Securities" means, except
as provided by the Trust Indenture Act, a vote by the Holder(s), voting
separately as a class, of more than 50% of the liquidation preference of all
the outstanding Preferred Securities issued by the Issuer.
"Officers' Certificate" means, with respect to any Person, a
certificate signed by (i) the Chairman, Chief Executive Officer, President or
a Vice President, and by (ii) the Treasurer, an Assistant Treasurer, the
Controller, the Secretary or an Assistant Secretary of such Person, and
delivered to the Guarantee Trustee. Any Officers' Certificate delivered with
respect to compliance with a condition or covenant provided for in this
Guarantee Agreement shall include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions
relating thereto;
(b) a brief statement of the nature and scope of the examination
or investigation undertaken by each officer in rendering the Officers'
Certificate;
(c) a statement that each such officer has made such examination
or investigation as, in such officer's opinion, is necessary to enable
such officer to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever
nature.
"Responsible Officer" means, with respect to the Guarantee Trustee,
any officer assigned to the Trustee's Corporate Trust Office, including any
managing director, vice president, assistant vice president, assistant
treasurer, assistant secretary or any other officer of the Trustee
customarily performing functions similar to those performed by any of the
above designated officers and having
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direct responsibility for the administration of this Guarantee Agreement, and
also, with respect to a particular matter, any other officer, to whom such
matter is referred because of such officer's knowledge of and familiarity
with the particular subject.
"Subordinated Indenture" means the Junior Convertible Subordinated
Indenture, dated as of June 9, 1998, as supplemented and amended between the
Guarantor and The First National Bank of Chicago, as trustee.
"Successor Guarantee Trustee" means a successor Guarantee Trustee
possessing the qualifications to act as Guarantee Trustee under Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended.
ARTICLE 2
TRUST INDENTURE ACT
SECTION 2.1 TRUST INDENTURE ACT; APPLICATION.
(a) This Guarantee Agreement is subject to the provisions of the
Trust Indenture Act that are required to be part of this Guarantee
Agreement and shall, to the extent applicable, be governed by such
provisions.
(b) If and to the extent that any provision of this Guarantee
Agreement limits, qualifies or conflicts with the duties imposed by
Sections 310 to 317, inclusive, of the Trust Indenture Act, such imposed
duties shall control.
SECTION 2.2 LIST OF HOLDERS.
(a) The Guarantor shall furnish or cause to be furnished to the
Guarantee Trustee (unless the Guarantee Trustee is acting as Securities
Registrar with respect to the Debentures under the Subordinated
Indenture) (i) semi-annually, on or before January 15 and July 15 of each
year, a list, in such form as the Guarantee Trustee may reasonably
require, of the names and addresses of the Holders ("List of Holders") as
of a date not more than 15 days prior to the delivery thereof, and (ii)
at such other times as the Guarantee Trustee may request in writing,
within 30 days after the receipt by the Guarantor of any such written
request, a List of Holders as of a date not more than 15 days prior to
the time such list is furnished, in each case to the extent such
information is in the possession or control of the Guarantor and is not
identical to a previously supplied list of Holders or has not otherwise
been received by the Guarantee Trustee. Notwithstanding the foregoing,
the Guarantor shall not be obligated to provide such List of Holders at
any time the Preferred Securities are represented by one or more Global
Certificates (as defined in the Subordinated Indenture). The Guarantee
Trustee may destroy any List of Holders previously given to it on receipt
of a new List of Holders.
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(b) The Guarantee Trustee shall comply with its obligations under
Section 311(a), Section 311(b) and Section 312(b) of the Trust Indenture
Act.
SECTION 2.3 REPORTS BY THE GUARANTEE TRUSTEE. Within 60
days after May 15, 1999 in each calendar year, commencing with May 15, 1999,
the Guarantee Trustee shall provide to the Holders such reports as are
required by Section 313 of the Trust Indenture Act, if any, in the form and
in the manner provided by Section 313 of the Trust Indenture Act. The
Guarantee Trustee shall also comply with the requirements of Section 313(d)
of the Trust Indenture Act.
SECTION 2.4 PERIODIC REPORTS TO GUARANTEE TRUSTEE. The
Guarantor shall provide to the Guarantee Trustee, the Securities and Exchange
Commission and the Holders such documents, reports and information, if any,
as required by Section 314 of the Trust Indenture Act and the compliance
certificate required by Section 314 of the Trust Indenture Act in the form,
in the manner and at the times required by Section 314 of the Trust Indenture
Act; and such compliance certificate of the Guarantor shall be delivered on
or before 120 days after the end of each calendar year.
SECTION 2.5 EVIDENCE OF COMPLIANCE WITH CONDITIONS
PRECEDENT. The Guarantor shall provide to the Guarantee Trustee such
evidence of compliance with such conditions precedent, if any, provided for
in this Guarantee Agreement that relate to any of the matters set forth in
Section 314(c) of the Trust Indenture Act. Any certificate or opinion
required to be given by an officer pursuant to Section 314(c)(1) may be given
in the form of an Officers' Certificate.
SECTION 2.6 EVENTS OF DEFAULT; WAIVER. The Holders of a
Majority in Liquidation Preference of the Securities may, by vote, on behalf
of the Holders, waive any past Event of Default and its consequences. Upon
such waiver, any such Event of Default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every
purpose of this Guarantee Agreement, but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right
consequent therefrom.
SECTION 2.7 EVENT OF DEFAULT; NOTICE.
(a) The Guarantee Trustee shall, within 90 days after the
occurrence of an Event of Default, transmit by mail, first class postage
prepaid, to the Holders, notices of all Events of Default actually known
to a Responsible Officer of the Guarantee Trustee, unless such defaults
have been cured before the giving of such notice, provided, that, except
in the case of a default in the payment of a Guarantee Payment, the
Guarantee Trustee shall be fully protected in withholding such notice if
and so long as the Board of Directors, the executive committee or a trust
committee of directors and/or Responsible Officers of the Guarantee
Trustee in good faith determines that the withholding of such notice is
in the interests of the Holders.
(b) The Guarantee Trustee shall not be deemed to have actual
knowledge of any Event of Default unless the Guarantee Trustee shall have
received written notice, or a
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Responsible Officer charged with the administration of the Declaration
shall have obtained written notice, of such Event of Default.
SECTION 2.8 CONFLICTING INTERESTS. The Declaration and the
Subordinated Indenture shall be deemed to be specifically described in this
Guarantee Agreement for the purposes of clause (i) of the first proviso
contained in Section 310(b) of the Trust Indenture Act.
ARTICLE 3
POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE
SECTION 3.1 POWERS AND DUTIES OF THE GUARANTEE TRUSTEE.
(a) This Guarantee Agreement shall be held by the Guarantee
Trustee for the benefit of the Holders, and the Guarantee Trustee shall
not transfer this Guarantee Agreement to any Person except a Holder
exercising his or her rights pursuant to Section 5.4(iv) or to a
Successor Guarantee Trustee on acceptance by such Successor Guarantee
Trustee of its appointment to act as Successor Guarantee Trustee. The
right, title and interest of the Guarantee Trustee shall automatically
vest in any Successor Guarantee Trustee, upon acceptance by such
Successor Guarantee Trustee of its appointment hereunder, and such
vesting and cessation of title shall be effective whether or not
conveyancing documents have been executed and delivered pursuant to the
appointment of such Successor Guarantee Trustee.
(b) If an Event of Default actually known to a Responsible Officer
of the Guarantee Trustee has occurred and is continuing, the Guarantee
Trustee shall enforce this Guarantee Agreement for the benefit of the
Holders.
(c) The Guarantee Trustee, before the occurrence of any Event of
Default and after the curing of all Events of Default that may have
occurred, shall undertake to perform only such duties as are specifically
set forth in this Guarantee Agreement, and no implied covenants shall be
read into this Guarantee Agreement against the Guarantee Trustee. In
case an Event of Default has occurred (that has not been cured or waived
pursuant to Section 2.6) and is actually known to the Responsible Officer
of the Guarantee Trustee, the Guarantee Trustee shall exercise such of
the rights and powers vested in it by this Guarantee Agreement, and use
the same degree of care and skill in its exercise thereof, as a prudent
person would exercise or use under the circumstances in the conduct of
his or her own affairs.
(d) No provision of this Guarantee Agreement shall be construed to
relieve the Guarantee Trustee from liability for its own negligent
action, its own negligent failure to act or its own willful misconduct,
except that:
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(i) prior to the occurrence of any Event of Default and
after the curing or waiving of all such Events of Default that may
have occurred;
(A) the duties and obligations of the Guarantee
Trustee shall be determined solely by the express
provisions of this Guarantee Agreement, and the Guarantee
Trustee shall not be liable except for the performance of
such duties and obligations as are specifically set forth
in this Guarantee Agreement, and no implied covenants or
obligations shall be read into this Guarantee Agreement
against the Guarantee Trustee; and
(B) in the absence of bad faith on the part of the
Guarantee Trustee, the Guarantee Trustee may conclusively
rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon any certificates or
opinions furnished to the Guarantee Trustee and conforming
to the requirements of this Guarantee Agreement; but in the
case of any such certificates or opinions that by any
provision hereof or of the Trust Indenture Act are
specifically required to be furnished to the Guarantee
Trustee, the Guarantee Trustee shall be under a duty to
examine the same to determine whether or not they conform
to the requirements of this Guarantee Agreement;
(ii) the Guarantee Trustee shall not be liable for any
error of judgment made in good faith by a Responsible Officer of
the Guarantee Trustee, unless it shall be proved that the
Guarantee Trustee was negligent in ascertaining the pertinent
facts upon which such judgment was made;
(iii) the Guarantee Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in good
faith in accordance with the direction of the Holders of not less
than a Majority in Liquidation Preference of the Securities
relating to the time, method and place of conducting any
proceeding for any remedy available to the Guarantee Trustee, or
exercising any trust or power conferred upon the Guarantee Trustee
under this Guarantee Agreement; and
(iv) no provision of this Guarantee Agreement shall
require the Guarantee Trustee to expend or risk its own funds
or otherwise incur personal financial liability in the performance
of any of its duties or in the exercise of any of its rights or
powers, if the Guarantee Trustee shall have reasonable grounds for
believing that the repayment of such funds or liability is not
reasonably assured to it under the terms of this Guarantee
Agreement or indemnity satisfactory to it against such risk or
liability is not reasonably assured to it.
SECTION 3.2 CERTAIN RIGHTS OF GUARANTEE TRUSTEE.
(a) Subject to the provisions of Section 3.1:
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(i) The Guarantee Trustee may conclusively rely and
shall be fully protected in acting or refraining from acting
upon any resolution, certificate, statement, proxy, instrument,
opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other
paper or document believed by it to be genuine and to have been
signed, sent or presented by the proper party or parties.
(ii) Any direction or act of the Guarantor contemplated
by this Guarantee Agreement shall be sufficiently evidenced by
an Officers' Certificate unless otherwise prescribed herein.
(iii) Whenever, in the administration of this Guarantee
Agreement, the Guarantee Trustee shall deem it desirable that a
matter be proved or established before taking, suffering or
omitting to take any action hereunder, the Guarantee Trustee
(unless other evidence is herein specifically prescribed) may,
in the absence of bad faith on its part, request and
conclusively rely upon an Officers' Certificate which, upon
receipt of such request from the Guarantee Trustee, shall be
promptly delivered by the Guarantor.
(iv) The Guarantee Trustee may consult with legal
counsel, and the written advice or opinion of such legal
counsel with respect to legal matters shall be full and
complete authorization and protection in respect of any action
taken, suffered or omitted to be taken by it hereunder in good
faith and in accordance with such advice or opinion. Such
legal counsel may be legal counsel to the Guarantor or any of
its Affiliates and may be one of its employees. The Guarantee
Trustee shall have the right at any time to seek instructions
concerning the administration of this Guarantee Agreement from
any court of competent jurisdiction.
(v) The Guarantee Trustee shall be under no obligation
to exercise any of the rights or powers vested in it by this
Guarantee Agreement at the request or direction of any Holder,
unless such Holder shall have provided to the Guarantee Trustee
and its officers, directors and agents such adequate security
and indemnity as would satisfy a reasonable person in the
position of the Guarantee Trustee, against the costs, expenses
(including attorneys' fees and expenses) and liabilities that
might be incurred by it in complying with such request or
direction, including such reasonable advances as may be
requested by the Guarantee Trustee; provided that, nothing
contained in this Section 3.2(a)(v) shall be taken to relieve
the Guarantee Trustee, upon the occurrence of an Event of
Default, of its obligation to exercise the rights and powers
vested in it by this Guarantee Agreement and use the same
degree of care and skill in the exercise thereof as a prudent
person would exercise or use under the circumstances in the
conduct of his or her own affairs.
(vi) The Guarantee Trustee shall not be bound to make
any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument,
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opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other
paper or document, but the Guarantee Trustee, in its
discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit.
(vii) The Guarantee Trustee may execute any of the
trusts or powers hereunder or perform any duties hereunder
either directly or by or through its agents, custodians,
nominees or attorneys or any Affiliate, and the Guarantee
Trustee shall not be responsible for any misconduct or
negligence on the part of any such agent or attorney appointed
with due care by it hereunder.
(viii) Whenever in the administration of this Guarantee
Agreement the Guarantee Trustee shall deem it desirable to
receive instructions with respect to enforcing any remedy or
right or taking any other action hereunder, the Guarantee
Trustee (A) may request written instructions from the Holders
of a Majority in Liquidation Preference of the Securities, (B)
may refrain from enforcing such remedy or right or taking such
other action until such instructions are received, and (c)
shall be fully protected in acting in accordance with such
instructions.
(b) No provision of this Guarantee Agreement shall be deemed to
impose any duty or obligation on the Guarantee Trustee to perform any
act or acts or exercise any right, power, duty or obligation conferred
or imposed on it in any jurisdiction in which it shall be illegal, or
in which the Guarantee Trustee shall be unqualified or incompetent in
accordance with applicable law, to perform any such act or acts or to
exercise any such right, power, duty or obligation. No permissive
power or authority available to the Guarantee Trustee shall be
construed to be a duty to act in accordance with such power and
authority.
SECTION 3.3 INDEMNITY. The Guarantor agrees to indemnify
the Guarantee Trustee for, and to hold it harmless against, any loss,
liability or expense incurred without negligence or bad faith on the part of
the Guarantee Trustee, arising out of or in connection with the acceptance or
administration of this Guarantee Agreement, including the reasonable costs
and expenses of defending itself against any claim or liability in connection
with the exercise or performance of any of its powers or duties hereunder.
The Guarantee Trustee will not claim or exact any lien or charge on any
Guarantee Payment as a result of any amount due to it under this Guarantee
Agreement. Guarantor's indemnification obligations set forth in this Section
3.3 shall survive termination of this Guarantee Agreement or resignation or
removal of the Guarantee Trustee.
ARTICLE 4
GUARANTEE TRUSTEE
SECTION 4.1 GUARANTEE TRUSTEE; ELIGIBILITY.
(a) There shall at all times be a Guarantee Trustee which shall:
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(i) not be an Affiliate of the Guarantor; and
(ii) be a Person that is eligible pursuant to the Trust
Indenture Act to act as such and has a combined capital and
surplus of at least $50,000,000, and shall be a corporation
meeting the requirements of Section 310(a) of the Trust
Indenture Act. If such corporation publishes reports of
condition at least annually, pursuant to law or to the
requirements of the supervising or examining authority, then,
for the purposes of this Section and to the extent permitted by
the Trust Indenture Act, 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.
(b) If at any time the Guarantee Trustee shall cease to be
eligible to so act under Section 4.1(a), the Guarantee Trustee shall
immediately resign in the manner and with the effect set out in
Section 4.2(c).
(c) If the Guarantee Trustee has or shall acquire any
"conflicting interest" within the meaning of Section 310(b) of the
Trust Indenture Act, the Guarantee Trustee and Guarantor shall in all
respects comply with the provisions of Section 310(b) of the Trust
Indenture Act.
SECTION 4.2 APPOINTMENT, REMOVAL AND RESIGNATION OF THE
GUARANTEE TRUSTEE.
(a) Subject to Section 4.2(b), the Guarantee Trustee may be
appointed or removed without cause at any time by the Guarantor.
(b) The Guarantee Trustee shall not be removed until a
Successor Guarantee Trustee has been appointed and has accepted such
appointment by written instrument executed by such Successor Guarantee
Trustee and delivered to the Guarantor.
(c) The Guarantee Trustee appointed hereunder shall hold office
until a Successor Guarantee Trustee shall have been appointed or until
its removal or resignation. The Guarantee Trustee may resign from
office (without need for prior or subsequent accounting) by an
instrument in writing executed by the Guarantee Trustee and delivered
to the Guarantor, which resignation shall not take effect until a
Successor Guarantee Trustee has been appointed and has accepted such
appointment by an instrument in writing executed by such Successor
Guarantee Trustee and delivered to the Guarantor and the resigning
Guarantee Trustee.
(d) If no Successor Guarantee Trustee shall have been appointed
and accepted appointment as provided in this Section 4.2 within 60
days after delivery to the Guarantor of an instrument of resignation,
the resigning Guarantee Trustee may petition, at the expense of the
Guarantor, any court of competent jurisdiction for appointment of a
Successor Guarantee Trustee. Such court may thereupon, after
prescribing such notice, if any, as it may deem proper, appoint a
Successor Guarantee Trustee.
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(e) No Guarantee Trustee shall be liable for the acts or
omissions of any successor Guarantor Trustee.
(f) Upon the removal or resignation of the Guarantee Trustee,
the Guarantor shall pay all amounts due and owing to such Guarantee
Trustee.
ARTICLE 5
GUARANTEE
SECTION 5.1 GUARANTEE. The Guarantor irrevocably and
unconditionally agrees to pay in full to the Holders the Guarantee Payments
(without duplication of amounts theretofore paid by or on behalf of the
Issuer), as and when due, regardless of any defense, right of set-off or
counterclaim which the Issuer may have or assert other than the defense of
payment. The Guarantor's obligation to make a Guarantee Payment may be
satisfied by direct payment of the required amounts by the Guarantor to the
Holders or by causing the Issuer to pay such amounts to the Holders.
SECTION 5.2 WAIVER OF NOTICE AND DEMAND. The Guarantor
hereby waives notice of acceptance of the Guarantee Agreement and of any
liability to which it applies or may apply, presentment, demand for payment,
any right to require a proceeding first against the Guarantee Trustee, Issuer
or any other Person before proceeding against the Guarantor, protest, notice
of nonpayment, notice of dishonor, notice of redemption and all other notices
and demands.
SECTION 5.3 OBLIGATIONS NOT AFFECTED. The obligations,
covenants, agreements and duties of the Guarantor under this Guarantee
Agreement shall in no way be affected or impaired by reason of the happening
from time to time of any of the following:
(a) the release or waiver, by operation of law or otherwise, of
the performance or observance by the Issuer of any express or implied
agreement, covenant, term or condition relating to the Preferred
Securities to be performed or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all
or any portion of the Distributions (other than an extension of time
for payment of Distributions that results from the extension of any
interest payment period on the Debentures as so provided in the
Subordinated Indenture), Redemption Price, Liquidation Distribution or
any other sums payable under the terms of the Preferred Securities or
the extension of time for the performance of any other obligation
under, arising out of, or in connection with, the Preferred Securities;
(c) any failure, omission, delay or lack of diligence on the
part of the Holders to enforce, assert or exercise any right,
privilege, power or remedy conferred on the Holders pursuant to the
terms of the Preferred Securities, or any action on the part of the
Issuer granting indulgence or extension of any kind;
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(d) the voluntary or involuntary liquidation, dissolution, sale
of any collateral, receivership, insolvency, bankruptcy, assignment
for the benefit of creditors, reorganization, arrangement, composition
or readjustment of debt of, or other similar proceedings affecting,
the Issuer or any of the assets of the Issuer;
(e) any invalidity of, or defect or deficiency in, the
Preferred Securities;
(f) the settlement or compromise of any obligation guaranteed
hereby or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a guarantor,
it being the intent of this Section 5.3 that the obligations of the
Guarantor hereunder shall be absolute and unconditional under any and
all circumstances.
There shall be no obligation of the Holders or the Guarantee Trustee
to give notice to, or obtain the consent of, the Guarantor with respect to
the happening of any of the foregoing.
SECTION 5.4 RIGHTS OF HOLDERS. The Guarantor expressly
acknowledges that: (i) this Guarantee Agreement will be deposited with the
Guarantee Trustee to be held for the benefit of the Holders; (ii) the
Guarantee Trustee has the right to enforce this Guarantee Agreement on behalf
of the Holders; (iii) the Holders of a Majority in Liquidation Preference of
the Securities have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Guarantee Trustee
in respect of this Guarantee Agreement or to direct the exercise of any trust
or power conferred upon the Guarantee Trustee under this Guarantee Agreement;
and (iv) if the Guarantee Trustee fails to enforce the Guarantee, any Holder
may institute a legal proceeding directly against the Guarantor to enforce
its rights under this Guarantee Agreement, without first instituting a legal
proceeding against the Guarantee Trustee, the Issuer or any other Person.
SECTION 5.5 GUARANTEE OF PAYMENT. This Guarantee Agreement
creates a guarantee of payment and not of collection. This Guarantee
Agreement will not be discharged except by payment of the Guarantee Payments
in full (without duplication of amounts theretofore paid by the Issuer) or
upon distribution of Debentures to Holders as provided in the Declaration.
SECTION 5.6 SUBROGATION. The Guarantor shall be subrogated
to all (if any) rights of the Holders against the Issuer in respect of any
amounts paid to the Holders by the Guarantor under this Guarantee Agreement
and shall have the right to waive payment by the Issuer pursuant to Section
5.1; provided, however, that the Guarantor shall not (except to the extent
required by mandatory provisions of law) be entitled to enforce or exercise
any rights which it may acquire by way of subrogation or any indemnity,
reimbursement or other agreement, in all cases as a result of payment under
this Guarantee Agreement, if, at the time of any such payment, any amounts
are due and unpaid under this Guarantee Agreement. If any amount shall be
paid to the Guarantor in violation of the preceding sentence, the Guarantor
agrees to hold such amount in trust for the Holders and to pay over such
amount to the Holders.
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SECTION 5.7 INDEPENDENT OBLIGATIONS. The Guarantor
acknowledges that its obligations hereunder are independent of the
obligations of the Issuer with respect to the Preferred Securities and that
the Guarantor shall be liable as principal and as debtor hereunder to make
Guarantee Payments pursuant to the terms of this Guarantee Agreement
notwithstanding the occurrence of any event referred to in subsections (a)
through (g), inclusive, of Section 5.3 hereof.
ARTICLE 6
COVENANTS AND SUBORDINATION
SECTION 6.1 SUBORDINATION. The Guarantee Agreement will
constitute an unsecured obligation of the Guarantor and will rank subordinate
and junior in right of payment to all liabilities of the Guarantor and PARI
PASSU with the most senior preferred stock of the Guarantor, if any, now or
hereafter issued by the Company and with any guarantee now or hereafter
entered into by the Company in respect of any preferred or preference stock
of any affiliate of the Guarantor.
SECTION 6.2 CERTAIN COVENANTS OF THE GUARANTOR.
(a) Guarantor covenants and agrees that if and so long as (i)
the Issuer is the holder of all the Debentures, (ii) a Tax Event (as
defined in the Declaration) in respect of the Issuer has occurred and
is continuing and (iii) the Guarantor has elected, and has not revoked
such election, to pay Additional Sums (as defined in the Declaration)
in respect of the Preferred Securities and Common Securities, the
Guarantor will pay to the Issuer such Additional Sums.
(b) The Guarantor covenants and agrees that it will not, and
will not cause any subsidiary of the Guarantor to, (i) declare or pay
dividends on, make distributions with respect to, or redeem, purchase
or acquire, or make a liquidation payment with respect to any of its
Capital Stock (except for (x) dividends or distributions in shares of,
or options, warrants or rights to subscribe for or purchase shares of
its Capital Stock and conversions or exchanges of Common Stock of one
class for Common Stock of another class and (y) redemptions or
purchases of any rights pursuant to a rights agreement and the
issuance of Capital Stock pursuant to such rights) or (ii) make any
payments of principal, interest or premium, if any, on or repay or
repurchase or redeem any debt securities (including guarantees of
indebtedness for money borrowed) of the Company that rank PARI PASSU
with or junior to the Debentures (other than (u) any redemption,
liquidation, interest, principal or guarantee payment by the Company
where the payment is made by way of securities (including Capital
Stock) that rank PARI PASSU with or junior to the securities on which
such redemption, interest, principal or guarantee payment is being
made, (v) payments under this Guarantee Agreement or the Common
Securities Guarantee, (w) purchases of Common Stock related to the
issuance of Common Stock under any of the Company's benefit plans for
its directors, officers or employees, (x) as a result of a
reclassification of the Company's Capital Stock or the exchange or
conversion of one series or class of the Company's Capital Stock for
another series or class of the Company's Capital Stock, (y) the
purchase of
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fractional interests in shares of the Company's Capital Stock pursuant
to the conversion or exchange provisions of such Capital Stock or the
security being converted or exchanged and (z) redemptions or purchases
of any rights pursuant to a rights agreement and the issuance of
Capital Stock pursuant to such rights) if at such time (i) for any
distribution period, full distributions on a cumulative basis on any
Trust Securities have not been paid, (ii) there shall have occurred
any event of which the Guarantor has actual knowledge that (a) with
the giving of notice or the lapse of time, or both, would constitute
an "Event of Default" under the Subordinated Indenture with respect to
the Debentures and (b) in respect of which the Guarantor shall not
have taken reasonable steps to cure, (iii) the Guarantor shall be in
default with respect to its payment of any obligations under the
Guarantee or the Common Securities Guarantee or (iv) the Guarantor
shall have given notice of its selection of an Extension Period (as
defined in the Subordinated Indenture) with respect to the Debentures
and shall not have rescinded such notice, or such Extension Period, or
any extension thereof, shall be continuing.
(c) The Guarantor covenants and agrees (i) to maintain directly
or indirectly 100% ownership of the Common Securities, provided that
certain successors which are permitted by the Subordinated Indenture
may succeed to the Guarantor's ownership of the Common Securities,
(ii) not to voluntarily terminate, wind-up or liquidate the Issuer,
except (a) in connection with a distribution of the Debentures to the
holders of the Preferred Securities in dissolution of the Issuer, (b)
the redemption of the Preferred Securities or (c) in connection with
certain mergers, consolidations or amalgamations permitted by the
Declaration, (iii) to use its commercially reasonable efforts,
consistent with the terms and provisions of the Declaration, to cause
the Issuer to remain classified as a grantor trust and not as an
association taxable as a corporation for United States Federal income
tax purposes, (iv) for so long as Preferred Securities are
outstanding, not to convert Debentures except pursuant to a notice of
conversion delivered to the Conversion Agent (as defined in the
Declaration) by a Holder, (v) to maintain the reservation for issuance
of the number of shares of Common Stock that would be required from
time to time upon the conversion of all the Debentures then
outstanding, (vi) to deliver shares of Common Stock upon an election
by the Holders to convert such Preferred Securities into Common Stock
and (vii) to honor all obligations described herein relating to the
conversion or exchange of the Preferred Securities into or for Common
Stock or Debentures.
ARTICLE 7
TERMINATION
SECTION 7.1 TERMINATION. This Guarantee Agreement shall
terminate and be of no further force and effect upon (i) full payment of the
Redemption Price of all Preferred Securities, (ii) the distribution of
Debentures to the Holders in exchange for all of the Preferred Securities,
(iii) full payment of the amounts payable in accordance with the Declaration
upon dissolution of the Issuer or (iv) upon the distribution, if any, of
Common Stock to the holders of the Preferred Securities in respect of the
conversion of all such holders' Preferred Securities into Common Stock.
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Notwithstanding the foregoing, this Guarantee Agreement will continue to be
effective or will be reinstated, as the case may be, if at any time any
Holder must restore payment of any sums paid with respect to Preferred
Securities or this Guarantee Agreement.
ARTICLE 8
MISCELLANEOUS
SECTION 8.1 SUCCESSORS AND ASSIGNS. All guarantees and
agreements contained in this Guarantee Agreement shall bind the successors,
assigns, receivers, trustees and representatives of the Guarantor and shall
inure to the benefit of the Holders of the Preferred Securities then
outstanding. Except in connection with a consolidation, merger or sale
involving the Guarantor that is permitted under Article 8 of the Subordinated
Indenture and pursuant to which the assignee agrees in writing to perform the
Guarantor's obligations hereunder, the Guarantor shall not assign its
obligations hereunder.
SECTION 8.2 AMENDMENTS. Except with respect to any changes
which do not adversely affect the rights of the Holders in any material
respect (in which case no consent of the Holders will be required), this
Guarantee Agreement may only be amended with the prior approval of the
Holders of not less than a Majority in Liquidation Preference of the
Securities. The provisions of Article 6 of the Declaration concerning
meetings of the Holders shall apply to the giving of such approval. The
Guarantor shall furnish the Guarantee Trustee with an Officers' Certificate
and an Opinion of Counsel to the effect that any amendment of this Agreement
is authorized and permitted.
SECTION 8.3 NOTICES. Any notice, request or other
communication required or permitted to be given hereunder shall be in
writing, duly signed by the party giving such notice, and delivered,
telecopied or mailed by first class mail as follows:
(a) if given to the Guarantor, to the address set forth below or
such other address as the Guarantor may give notice of to the Holders:
Tower Automotive, Inc.
6303 28th Street S.E.
Grand Rapids, Michigan 49546
Phone No.: (616) 954-7600
Facsimile No.: (616) 954-7554
Attention: Vice President and Chief Financial Officer
(b) if given to the Issuer, in care of the Guarantee Trustee, at
the Issuer's (and the Guarantee Trustee's) address set forth below or
such other address as the Guarantee Trustee on behalf of the Issuer may
give notice of to the Holders:
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Tower Automotive Capital Trust
4508 IDS Center
Minneapolis, Minnesota 55402
Phone No.: (612) 342-2310
Facsimile No.: (612) 332-2012
Attention: Vice President
with a copy to:
The First National Bank of Chicago
One First National Plaza, Suite 0126
Chicago, Illinois 60670-0126
Phone No.: (312) 407-1819
Facsimile No.: (312) 407-4656
Attention: Corporate Trust Services Division
(c) if given to any Holder, at the address set forth on the books
and records of the Issuer.
All notices hereunder shall be deemed to have been given when received
in person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid, except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no
notice was given, such notice or other document shall be deemed to have been
delivered on the date of such refusal or inability to deliver.
SECTION 8.4 BENEFIT. This Guarantee Agreement is solely
for the benefit of the Holders and is not separately transferable from the
Preferred Securities.
SECTION 8.5 INTERPRETATION. In this Guarantee Agreement,
unless the context otherwise requires:
(a) capitalized terms used in this Guarantee Agreement but
not defined in the preamble hereto have the respective meanings
assigned to them in Section 1.1;
(b) a term defined anywhere in this Guarantee Agreement has
the same meaning throughout;
(c) all references to "the Guarantee Agreement" or "this
Guarantee Agreement" are to this Guarantee Agreement as modified,
supplemented or amended from time to time;
(d) all references in this Guarantee Agreement to Articles
and Sections are to Articles and Sections of this Guarantee Agreement
unless otherwise specified;
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(e) a term defined in the Trust Indenture Act has the same
meaning when used in this Guarantee Agreement unless otherwise defined
in this Guarantee Agreement or unless the context otherwise requires;
(f) a reference to the singular includes the plural and vice
versa; and
(g) the masculine, feminine or neuter genders used herein
shall include the masculine, feminine and neuter genders.
SECTION 8.6 GOVERNING LAW. THIS GUARANTEE AGREEMENT SHALL
BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF ILLINOIS WITHOUT REGARD TO THE CONFLICT OF LAW PRINCIPLES
THEREOF.
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
* * * * * *
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THIS GUARANTEE AGREEMENT is executed as of the day and year first above
written.
TOWER AUTOMOTIVE, INC.
By: /s/ Anthony A. Barone
-----------------------------------------------
Name: Anthony A. Barone
Title: Vice President and Chief Financial Officer
THE FIRST NATIONAL BANK OF CHICAGO,
as Guarantee Trustee
By: /s/ Victoria Y. Dowyon
-----------------------------------------------
Name: Victoria Y. Douyon
-----------------------------------------------
Title: Vice President
-----------------------------------------------
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EXHIBIT 4.7
REGISTRATION RIGHTS AGREEMENT
Dated as of June 9, 1998
by and among
Tower Automotive, Inc.,
Tower Automotive Capital Trust
and
Donaldson, Lufkin & Jenrette
Securities Corporation
Robert W. Baird & Co. Incorporated
Merrill Lynch, Pierce, Fenner & Smith Incorporated
PaineWebber Incorporated
<PAGE>
This Registration Rights Agreement (this "AGREEMENT") is made and
entered into as of June 9, 1998 by and among Tower Automotive, Inc., a
Delaware corporation (the "COMPANY"), Tower Automotive Capital Trust (a
statutory business trust formed under the Delaware Business Trust Act) (the
"Trust") and Donaldson, Lufkin & Jenrette Securities Corporation, Robert W.
Baird & Co. Incorporated, Merrill Lynch, Pierce, Fenner & Smith Incorporated
and PaineWebber Incorporated (each an "INITIAL PURCHASER" and, collectively,
the "INITIAL PURCHASERS"), each of whom has agreed to purchase the Trust's
6 3/4% Trust Convertible Preferred Securities (liquidation preference $50 per
Preferred Security) (the " PREFERRED SECURITIES") pursuant to the Purchase
Agreement (as defined below).
This Agreement is made pursuant to the Purchase Agreement, dated June 9,
1998 (the "PURCHASE AGREEMENT"), by and among the Company, the Trust and the
Initial Purchasers. In order to induce the Initial Purchasers to purchase
the Preferred Securities, the Company has agreed to provide the registration
rights set forth in this Agreement. The execution and delivery of this
Agreement is a condition to the obligations of the Initial Purchasers set
forth in Section 9 of the Purchase Agreement.
The parties hereby agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement, the following capitalized terms shall have the
following meanings:
ACT: The Securities Act of 1933, as amended.
AFFILIATE: An affiliate of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or
indirect common control with such specified Person. For the purposes of this
definition, "control" when used with respect to any specified Person means
the power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract
or otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
BUSINESS DAY: Any day except a Saturday, Sunday or other day in the
City of Chicago, or in the city of the corporate trust office of the Trustee,
on which banks are authorized to close.
CLOSING DATE: The date hereof.
COMMISSION: The Securities and Exchange Commission.
DAMAGES PAYMENT DATE: With respect to the Debentures, each Interest
Payment Date.
<PAGE>
DECLARATION. Means the Amended and Restated Declaration of Trust dated
June 9, 1998 among the Company, The First National Bank of Chicago, First
Chicago Delaware Inc. and the Administrative Trustees named therein.
DEBENTURES: Up to $266,800,000 aggregate principal amount of 6 3/4%
Convertible Subordinated Debentures due June 30, 2018 of the Company being
issued (or authorized to be issued) pursuant to the Indenture.
DISTRIBUTION DATE: As defined in the Declaration.
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended.
FILING DATE: The 90th day after the Closing Date.
GLOBAL CERTIFICATEHOLDER. Means each holder of a Global Certificate (as
defined in the Declaration).
GLOBAL DEBENTUREHOLDER: Means each holder of a Global Debenture (as
defined in the Indenture).
GUARANTEE: The Guarantee by the Company set forth in Section 5.1 of
that certain Guarantee Agreement between the Company and The First National
Bank of Chicago relating to the Preferred Securities of the Trust.
HOLDERS: As defined in Section 2 hereof.
INDEMNIFIED HOLDER: As defined in Section 7(a) hereof.
INDENTURE: The Junior Convertible Subordinated Indenture, dated the
Closing Date, between the Company and The First National Bank of Chicago, as
trustee (the "TRUSTEE"), pursuant to which the Debentures are to be issued, as
such Indenture is amended or supplemented from time to time in accordance with
the terms thereof.
INTEREST PAYMENT DATE: As defined in the Indenture and the Debentures.
NASD: National Association of Securities Dealers, Inc.
PERSON: An individual, partnership, corporation, trust, unincorporated
organization, or a government or agency or political subdivision thereof.
PREFERRED SECURITIES. As defined in the preamble.
PROSPECTUS: The prospectus included in a Registration Statement at the
time such Registration Statement is declared effective, as amended or
supplemented by any prospectus
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supplement and by all other amendments thereto, including post-effective
amendments, and all material incorporated by reference into such Prospectus.
RECORD HOLDER: With respect to any Damages Payment Date, each Person
who is a Holder of Preferred Securities on the record date with respect to
the Distribution Date on which such Damages Payment Date shall occur, or, if
Debentures have been issued in exchange for Preferred Securities, each Person
who is a Holder of Debentures on the record date with respect to the Interest
Payment Date on which such Damages Payment Date shall occur.
REGISTRATION DEFAULT: As defined in Section 4 hereof.
REGISTRATION STATEMENT: Any registration statement of the Company and
the Trust that covers any of the Transfer Restricted Securities pursuant to
the provisions of this Agreement, including the Prospectus included therein,
all amendments and supplements thereto (including post-effective amendments)
and all exhibits and material incorporated by reference therein.
SHELF REGISTRATION STATEMENT: As defined in Section 3 hereof.
TIA: The Trust Indenture Act of 1939 (15 U.S.C. Section 77aaa-77bbbb) as
in effect on the date of the Indenture.
TRANSFER RESTRICTED SECURITIES: The Preferred Securities and the
Guarantee, the Debentures and the shares of Common Stock into which the
Preferred Securities and the Debentures are convertible, upon original
issuance thereof, and at all times subsequent thereto, until in the case of
any such securities or shares, (a) the date on which it has been registered
effectively pursuant to the Securities Act and disposed of in accordance with
the Registration Statement relating to it, (b) the date on which either such
Preferred Securities and Guarantee, Debentures or the shares of Common Stock
issued upon conversion of such Preferred Securities and Debentures are
distributed to the public pursuant to Rule 144 (or any similar provisions
then in effect) or are salable pursuant to Rule 144(k) promulgated by the
Commission pursuant to the Securities Act or (c) the date on which it ceases
to be outstanding.
UNDERWRITTEN REGISTRATION or UNDERWRITTEN OFFERING: A registration in
which securities of the Company are sold to an underwriter for reoffering to
the public.
SECTION 2. HOLDERS
A Person is deemed to be a holder of Transfer Restricted Securities
(each, a "HOLDER") whenever such Person owns Transfer Restricted Securities.
SECTION 3. SHELF REGISTRATION
(a) SHELF REGISTRATION. The Company and the Trust agree to file with
the Commission as promptly as reasonably practicable after the Closing Date,
but in no event later
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<PAGE>
than the Filing Date, a Registration Statement for an offering to be made on
a continuous basis pursuant to Rule 415 under the Act covering all of the
Transfer Restricted Securities (the "Shelf Registration Statement"). The
Company and the Trust shall use their best efforts to cause such Shelf
Registration Statement to become effective on or prior to 150 days after the
Closing Date. The Company and the Trust shall use their best efforts to keep
the Shelf Registration Statement discussed in this Section 3(a) continuously
effective, supplemented and amended as required by and subject to the
provisions of Sections 5(b) and (c) hereof to the extent necessary to ensure
that it is available for sales of Transfer Restricted Securities by the
Holders thereof entitled to the benefit of this Section 3(a), and to ensure
that it conforms with the requirements of this Agreement, the Act and the
policies, rules and regulations of the Commission as announced from time to
time, for a period of at least one year (as extended pursuant to Section
5(c)) following the Closing Date; provided, however, that the Company shall
not be required to maintain the effectiveness of such Shelf Registration
Statement upon the occurrence of the earlier of: (i) when all the Preferred
Securities covered by the Shelf Registration Statement have been sold
pursuant to the Shelf Registration Statement; (ii) when all Debentures issued
to Holders in exchange for the Preferred Securities have been sold pursuant
to the Registration Statement; (iii) when all shares issued upon conversion
of any such Preferred Securities or any such Debentures that have not been
sold pursuant to the Shelf Registration Statement have been sold pursuant to
the Shelf Registration Statement; and (iv) the date when Holders of the
Transfer Restricted Securities who are not Affiliates of the Trust or the
Company are able to sell all such securities immediately without restriction
pursuant to Rule 144(k) under the Act or any successor rate thereto.
(b) PROVISION BY HOLDERS OF CERTAIN INFORMATION IN CONNECTION WITH
THE SHELF REGISTRATION STATEMENT. No Holder of Transfer Restricted
Securities may include any of its Transfer Restricted Securities in any Shelf
Registration Statement pursuant to this Agreement unless and until such
Holder furnishes to the Company in writing, within 30 days after receipt of a
request therefor, such information specified in item 507 of Regulation S-K
under the Act for use in connection with any Shelf Registration Statement or
Prospectus or preliminary Prospectus included therein. No Holder of Transfer
Restricted Securities shall be entitled to include any of its Transfer
Restricted Securities in any Shelf Registration Statement or receive
Liquidated Damages pursuant to Section 4 hereof in the event that such Holder
fails to deliver such information within the specified period; provided,
however, that when such Holder furnishes such information to the Company,
such Holder shall be entitled to receive Liquidated Damages, if any, from the
date such Holder furnished such information and shall be entitled to include
its Transfer Restricted Securities in the Registration Statement.
Notwithstanding the foregoing, the Company shall not be required to file a
post-effective amendment or supplement to its Registration Statement or
Prospectus, as the case may be, to permit a Holder to include its Transfer
Restricted Securities after the Shelf Registration Statement has been
declared effective by the Commission more than once in any fiscal quarter.
Each Holder as to which any Shelf Registration Statement is being effected
agrees to furnish promptly to the Company all information required to be
disclosed in order to make the information previously furnished to the
Company by such Holder not materially misleading. A Holder that has
delivered to the Company the information required by this paragraph is herein
referred to as a "Participating Holder."
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<PAGE>
Any Person that acquires Transfer Restricted Securities from a
Participating Holder (excluding any Transfer Restricted Securities that were
not identified on the Participating Holder's information furnished hereunder)
will be entitled to have such Transfer Restricted Securities included in the
Shelf Registration Statement so long as such transferee provides the Company
with updated information. If such transferee's updated information is
received on or prior to the 10th day prior to the effective time, such
transferee will be entitled to have such transferee's Transfer Restricted
Securities included in the Shelf Registration Statement at the effective
time. If such transferee's updated information is received subsequent to
such 10th day, the Transfer Restricted Securities covered by such information
will be included in the Shelf Registration Statement reasonably promptly
after receipt (which date of inclusion may be subsequent to the effective
time, subject to the prior paragraph).
(c) Holders of a majority in aggregate principal amount of the Transfer
Restricted Securities shall have the right to sell their Transfer Restricted
Securities pursuant to an Underwritten Offering on one occasion.
SECTION 4. LIQUIDATED DAMAGES
If (i) any Shelf Registration Statement required by this Agreement is
not filed with the Commission on or prior to the date specified for such
filing in this Agreement (ii) any such Shelf Registration Statement has not
been declared effective by the Commission on or prior to the date specified
for such effectiveness in this Agreement, or (iii) any Shelf Registration
Statement required by this Agreement is filed and declared effective but
shall thereafter cease to be effective or fail to be usable for its intended
purpose without being succeeded immediately by a post-effective amendment to
such Registration Statement that cures such failure and that is itself
declared effective immediately (each such event referred to in clauses (i)
through (iii), a "REGISTRATION DEFAULT"), then the Company agrees to pay
liquidated damages to each Participating Holder of Transfer Restricted
Securities. With respect to Registration Defaults described in clause (i) or
(ii), the amount of liquidated damages shall be, for the first 90-day period
immediately following the occurrence of such Registration Default, an amount
equal to .25% of the liquidation preference or principal amount per Transfer
Restricted Security per annum and the amount of liquidated damages shall
increase to .50% thereafter. With respect to a Registration Default described
in clause (iii), if the Shelf Registration Statement ceases to be effective
for more than 90 days, whether or not consecutive during any 12-month period,
the amount of liquidated damages will be .50% of the liquidation preference
or principal amount per Transfer Restricted Security per annum from the 91st
day of the applicable 12-month period until such time as the Shelf
Registration Statement again becomes effective. If applicable, an equivalent
amount of liquidated damages per share (subject to adjustments in the event
of stock splits, stock recombinations, stock dividends and the like) of
Common Stock constituting Transfer Restricted Securities held by a
Participating Holder shall be paid as long as the Registration Default
continues until all Registration Defaults have been cured. Notwithstanding
anything to the contrary set forth herein, (1) upon filing of the Shelf
Registration Statement, in the case of (i) above, (2) upon the effectiveness
of the Shelf Registration Statement, in the case of (ii) above, or (3) upon
the filing of a prospectus supplement, a post-effective amendment to the
Shelf Registration Statement, an additional Registration Statement
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<PAGE>
or any other document with the Commission that causes the Shelf Registration
Statement to again be declared effective or made usable in the case of (iii)
above, the liquidated damages payable with respect to the Transfer Restricted
Securities as a result of such clause (i), (ii), or (iii), as applicable,
shall cease.
All accrued liquidated damages shall be paid to the Global
Debentureholder or the Global Certificateholder by wire transfer of
immediately available funds or by federal funds check and to Holders of
Debentures, Preferred Securities or Common Stock by mailing checks to their
registered addresses on each Damages Payment Date. All obligations of the
Company set forth in the preceding paragraph that are outstanding with
respect to any Transfer Restricted Security at the time such security ceases
to be a Transfer Restricted Security shall survive until such time as all
such obligations with respect to such security shall have been satisfied in
full.
SECTION 5. REGISTRATION PROCEDURES
(a) SHELF REGISTRATION STATEMENT. In connection with the Shelf
Registration Statement, the Company and the Trust shall comply with all the
provisions of Section 5(b) below and shall use its best efforts to effect
such registration to permit the sale of the Transfer Restricted Securities
being sold in accordance with the intended method or methods of distribution
thereof (as indicated in the information furnished to the Company pursuant to
Section 3(b) hereof), and pursuant thereto the Company and the Trust will
prepare and file with the Commission a Registration Statement relating to the
registration on any appropriate form under the Act, which form shall be
available for the sale of the Transfer Restricted Securities in accordance
with the intended method or methods of distribution thereof within the time
periods and otherwise in accordance with the provisions hereof.
(b) GENERAL PROVISIONS. In connection with any Registration
Statement and any related Prospectus required by this Agreement to permit the
sale or resale of Transfer Restricted Securities, the Company and the Trust
shall:
(i) use its best efforts to keep such Registration Statement
continuously effective and provide all requisite financial statements for
the period specified in Section 3 of this Agreement, as applicable. Upon
the occurrence of any event that would cause any such Registration
Statement or the Prospectus contained therein (A) to contain a material
misstatement or omission or (B) not to be effective and usable for resale
of Transfer Restricted Securities during the period required by this
Agreement, the Company shall file promptly an appropriate amendment to
such Registration Statement, (1) in the case of clause (A), correcting
any such misstatement or omission, and (2) in the case of clauses (A) and
(B), use its best efforts to cause such amendment to be declared effective
and such Registration Statement and the related Prospectus to become
usable for their intended purpose(s) as soon as practicable thereafter;
provided, however, that the Company may also file any other document with
the Commission that causes the Shelf Registration Statement to again be
declared effective or made usable for resale of Transfer Restricted
Securities.
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(ii) prepare and file with the Commission such amendments and
post-effective amendments to the Registration Statement as may be necessary
to keep the Registration Statement effective for the applicable period set
forth in Section 3 hereof, or such shorter period as will terminate when
all Transfer Restricted Securities covered by such Registration Statement
have been sold; cause the Prospectus to be supplemented by any required
Prospectus supplement, and as so supplemented to be filed pursuant to
Rule 424 under the Act, and to comply fully with Rules 424, 430A and 462,
as applicable, under the Act in a timely manner; and comply with the
provisions of the Act with respect to the disposition of all securities
covered by such Registration Statement during the applicable period in
accordance with the intended method or methods of distribution by the
sellers thereof set forth in such Registration Statement or supplement
to the Prospectus;
(iii) advise the underwriter(s), if any, and Participating
Holders, if requested by such Persons, (A) when the Prospectus or any
Prospectus supplement or post-effective amendment has been filed, and,
with respect to any Registration Statement or any post-effective
amendment thereto, when the same has become effective, (B) of any request
by the Commission for amendments to the Registration Statement or
amendments or supplements to the Prospectus or for additional information
relating thereto, (C) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement under the Act
or of the suspension by any state securities commission of the
qualification of the Transfer Restricted Securities for offering or sale
in any jurisdiction, or the initiation of any proceeding for any of the
preceding purposes, (D) of the existence of any fact or the happening of
any event that makes any statement of a material fact made in the
Registration Statement, the Prospectus, any amendment or supplement
thereto or any document incorporated by reference therein untrue, or that
requires the making of any additions to or changes in the Registration
Statement in order to make the statements therein not misleading, or that
requires the making of any additions to or changes in the Prospectus in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading. If at any time the Commission
shall issue any stop order suspending the effectiveness of the
Registration Statement, or any state securities commission or other
regulatory authority shall issue an order suspending the qualification or
exemption from qualification of the Transfer Restricted Securities under
state securities or Blue Sky laws, the Company shall use its best efforts
to obtain the withdrawal or lifting of such order at the earliest
possible time;
(iv) furnish to the Initial Purchaser(s), each Participating
Holder and each of the underwriter(s) in connection with such sale,
if any, before filing with the Commission, a copy of the Registration
Statement and the Prospectus included therein in the form proposed to be
initially filed with the Commission, which documents will be subject to
the review and comment of such Holders and underwriter(s) in connection
with such sale, if any, for a period of at least five Business Days, and
the Company will not file any such Registration Statement or Prospectus
to which the Participating Holders of the Transfer Restricted Securities
covered by such Registration Statement or the
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underwriter(s) in connection with such sale, if any, shall reasonably
object within five Business Days after the receipt thereof. A
Participating Holder or underwriter, if any, shall be deemed to have
reasonably objected to such filing if such Registration Statement or
Prospectus, as applicable, as proposed to be filed, contains a material
misstatement or omission or fails to comply with the applicable
requirements of the Act;
(v) upon written request, provide copies of any document that
has been incorporated by reference into a Registration Statement or
Prospectus to the Initial Purchasers and Participating Holders;
(vi) make available at reasonable times for inspection by the
selling Holders, any managing underwriter participating in any disposition
pursuant to such Registration Statement and any attorney or accountant
retained by such selling Holders or any of such underwriter(s) in
connection with an Underwritten Offering, all financial and other records,
pertinent corporate documents and properties of the Company and cause the
Company's officers, directors and employees to supply all information
reasonably requested by any such Holder, underwriter, attorney or
accountant in connection with such Registration Statement or any
post-effective amendment thereto subsequent to the filing thereof and
prior to its effectiveness, subject to an undertaking to maintain the
confidentiality of such information;
(vii) if requested by any Participating Holders or the
underwriter(s) in connection with an Underwritten Offering, if any,
promptly include in any Registration Statement or Prospectus, pursuant
to a supplement or post-effective amendment if necessary, such information
as such Participating Holders and underwriter(s), if any, may reasonably
request to have included therein, including, without limitation,
information relating to the "Plan of Distribution" of the Transfer
Restricted Securities, information with respect to the principal amount
of Transfer Restricted Securities being sold to such underwriter(s),
the purchase price being paid therefor and any other terms of the offering
of the Transfer Restricted Securities to be sold in such Underwritten
Offering; and make all required filings of such Prospectus supplement or
post-effective amendment as soon as reasonably practicable after the
Company is notified of the matters to be included in such Prospectus
supplement or post-effective amendment;
(viii) furnish to each Participating Holder and each of the
underwriter(s) in connection with an Underwritten Offering, if any, without
charge, at least one copy of the Registration Statement, as declared
effective by the Commission;
(ix) deliver to each Participating Holder and each of the
underwriter(s), if any, without charge, as many copies of the Prospectus
(including each preliminary prospectus in the case of an Underwritten
Offering) and any amendment or supplement thereto as such Persons
reasonably may request; the Company hereby consents to the use (in
accordance with law) of the Prospectus and any amendment or supplement
thereto by each of the Participating Holders and each of the
underwriter(s), if any, in connection
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with the offering and the sale of the Transfer Restricted Securities
covered by the Prospectus or any amendment or supplement thereto;
(x) enter into such agreements (including an underwriting
agreement) and make such representations and warranties and take all such
other actions in connection therewith in order to expedite or facilitate
the disposition of the Transfer Restricted Securities pursuant to any
Registration Statement contemplated by this Agreement as may be reasonably
requested by any underwriter in connection with any sale or resale pursuant
to any Registration Statement contemplated by this Agreement in connection
with an Underwritten Offering, and in such connection, the Company shall:
(A) furnish (or in the case of paragraphs (2) and (3), use
its best efforts to furnish) to each underwriter, if any, upon the
effectiveness of the Registration Statement:
(1) a certificate, dated the date of effectiveness of
the Shelf Registration Statement signed on behalf of the
Company by (x) the President and (y) the chief financial
officer of the Company and one of the Administrative
Trustees (as defined in the Declaration), confirming, as
of the date thereof, the matters set forth in Sections
6(cc), 9(a) and 9(b) of the Purchase Agreement and such
other similar matters as the underwriter(s) may
reasonably request;
(2) an opinion, dated the date of effectiveness of
the Registration Statement of counsel for the Company and
the Trust covering matters similar to those set forth in
paragraph (e) of Section 9 of the Purchase Agreement and
such other matter as the underwriters may reasonably
request, and in any event including a statement to the
effect that such counsel has participated in conferences
with officers and other representatives of the Company,
representatives of the independent public accountants for
the Company and have considered the matters required to
be stated therein and the statements contained therein,
although such counsel has not independently verified the
accuracy, completeness or fairness of such statements;
and that such counsel advises that, on the basis of the
foregoing, no facts came to such counsel's attention that
caused such counsel to believe that the Registration
Statement, at the time such Registration Statement or any
post-effective amendment thereto became effective,
contained an untrue statement of a material fact or
omitted to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading, or that the Prospectus contained in such
Registration Statement as of its date contained an untrue
statement of a material fact or omitted to state a
material fact necessary in order to make the statements
therein, in the light of the circumstances under which
they were made, not misleading. Without limiting the
foregoing, such counsel may state further that such
counsel assumes no responsibility for, and has not
independently verified, the accuracy, completeness or
fairness of the financial statements, notes and schedules
and other financial data included in any Registration
Statement contemplated by this Agreement or the related
Prospectus; and
9
<PAGE>
(3) a customary comfort letter, dated as of the date of
effectiveness of the Registration Statement from the Company's
independent accountants, in the customary form and covering matters
of the type customarily covered in comfort letters to underwriters
in connection with primary underwritten offerings, and affirming
the matters set forth in the comfort letters delivered pursuant to
Section 9 of the Purchase Agreement, without exception;
(B) set forth in full or incorporate by reference in the
underwriting agreement, if any, in connection with any sale or resale
pursuant to any Registration Statement the indemnification provisions
and procedures of Section 7 hereof with respect to all parties to be
indemnified pursuant to said Section; and
(C) deliver such other documents and certificates as may be
reasonably requested by the underwriter(s), if any, to evidence
compliance with clause (A) above and with any customary conditions
contained in the underwriting agreement or other agreement entered into
by the Company pursuant to this clause (x).
The above shall be done at each closing under such underwriting or
similar agreement, as and to the extent required thereunder, and if at any
time the representations and warranties of the Company contemplated in (A)(1)
above cease to be true and correct, the Company shall so advise the
underwriter(s) promptly and if requested by such Persons, shall confirm such
advice in writing;
(xi) prior to any public offering of Transfer Restricted
Securities, cooperate with the Participating Holders, the
underwriter(s), if any, and their respective counsel in connection with
the registration and qualification of the Transfer Restricted Securities
under the securities or Blue Sky laws of such jurisdictions as the
Participating Holders or underwriter(s), if any, may reasonably request
and do any and all other acts or things necessary or advisable to enable
the disposition in such jurisdictions of the Transfer Restricted
Securities covered by the applicable Registration Statement; PROVIDED,
HOWEVER, that the Company shall not be required to register or qualify
as a foreign corporation where it is not now so qualified or to take any
action that would subject it to the service of process in suits or to
taxation, other than as to matters and transactions relating to the
Registration Statement, in any jurisdiction where it is not now so
subject;
(xii) in connection with any sale of Transfer Restricted
Securities that will result in such securities no longer being Transfer
Restricted Securities, cooperate with the Participating Holders and the
underwriter(s), if any, to facilitate the timely preparation and
delivery of certificates representing Transfer Restricted Securities to
be sold and not bearing any restrictive legends; and to register such
Transfer Restricted Securities in such denominations and such names as
the Holders or the underwriter(s), if any, may reasonably request at
least two Business Days prior to such sale of Transfer Restricted
Securities;
10
<PAGE>
(xiii) use its best efforts to cause the disposition of the
Transfer Restricted Securities covered by the Registration Statement to
be registered with or approved by such other governmental agencies or
authorities as may be necessary to enable the seller or sellers thereof
or the underwriter(s), if any, to consummate the disposition of such
Transfer Restricted Securities, subject to the proviso contained in
clause (xi) above;
(xiv) subject to Section 5(b)(i), if any fact or event
contemplated by Section 5(b)(iii)(D) above shall exist or have occurred,
prepare a supplement or post-effective amendment to the Registration
Statement or related Prospectus or any document incorporated therein by
reference or file any other required document so that, as thereafter
delivered to the purchasers of Transfer Restricted Securities, the
Prospectus will not contain an untrue statement of a material fact or
omit to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading;
(xv) provide a CUSIP number for all Transfer Restricted
Securities not later than the effective date of a Registration Statement
covering such Transfer Restricted Securities and provide the Trustee
under the Indenture with printed certificates for the Transfer
Restricted Securities which are in a form eligible for deposit with the
Depository Trust Company;
(xvi) cooperate and assist in any filings required to be made
with the NASD and in the performance of any due diligence investigation
by any underwriter (including any "qualified independent underwriter")
that is required to be retained in accordance with the rules and
regulations of the NASD, and use its best efforts to cause such
Registration Statement to become effective and approved by such
governmental agencies or authorities as may be necessary to enable the
Holders selling Transfer Restricted Securities to consummate the
disposition of such Transfer Restricted Securities;
(xvii) otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission, and make generally
available to its security holders with regard to any applicable
Registration Statement, as soon as practicable, a consolidated earnings
statement meeting the requirements of Rule 158 (which need not be
audited) covering a twelve-month period beginning after the effective
date of the Registration Statement (as such term is defined in paragraph
(c) of Rule 158 under the Act);
(xviii) cause the Indenture to be qualified under the TIA not
later than the effective date of the first Registration Statement
required by this Agreement and, in connection therewith, cooperate with
the Trustee and the Holders of Notes to effect such changes to the
Indenture as may be required for such Indenture to be so qualified in
accordance with the terms of the TIA; and execute and use its best
efforts to cause the Trustee to execute, all documents that may be
required to effect such changes and all other forms and documents
required to be filed with the Commission to enable such Indenture to be
so qualified in a timely manner;
11
<PAGE>
(xix) concurrently with the effectiveness of the Shelf
Registration Agreement, list all Common Stock covered by such
Registration Statement on any securities exchange on which the Common
Stock is then listed.
(c) RESTRICTIONS ON HOLDERS. Each Holder agrees by acquisition of a
Transfer Restricted Security that, upon receipt of the notice referred to in
Section 5(b)(iii)(D) hereof, such Holder will forthwith discontinue
disposition of Transfer Restricted Securities pursuant to the Registration
Statement until such Holder's receipt of the copies of the supplemented or
amended Prospectus contemplated by Section 5(b)(xiv) hereof, or until it is
advised in writing by the Company that the use of the Prospectus may be
resumed, and has received copies of any additional or supplemental filings
that are incorporated by reference in the Prospectus (the "Advice"). If so
directed by the Company, each Holder will deliver to the Company (at the
Company's expense) all copies, other than permanent file copies then in such
Holder's possession, of the Prospectus covering such Transfer Restricted
Securities that was current at the time of receipt of either such notice. In
the event the Company shall give any such notice, the time period regarding
the effectiveness of such Registration Statement set forth in Section 3, as
applicable, shall be extended by the number of days during the period from
and including the date of the giving of such notice pursuant to Section
5(b)(i) or Section 5(b)(iii)(D) hereof to and including the date when each
selling Holder covered by such Registration Statement shall have received the
copies of the supplemented or amended Prospectus contemplated by Section
5(b)(xiv) hereof or shall have received the Advice.
SECTION 6. REGISTRATION EXPENSES
(a) All expenses incident to the Company's performance of or compliance
with this Agreement will be borne by the Company, regardless of whether a
Registration Statement becomes effective, including without limitation: (i)
all registration and filing fees and expenses (including filings made by any
Holder with the NASD (and, if applicable, the reasonable fees and expenses of
any "qualified independent underwriter") and its counsel that may be required
by the rules and regulations of the NASD); (ii) all fees and expenses of
compliance with federal securities and state Blue Sky or securities laws;
(iii) all expenses of printing, messenger and delivery services and
telephone; (iv) all fees and disbursements of counsel for the Company and one
designated counsel for Holders of Transfer Restricted Securities in
connection with an Underwritten Offering; (v) all application and filing fees
in connection with listing the Preferred Securities and the Guarantee,
Debentures and Common Stock on a national securities exchange pursuant to the
requirements hereof; and (vi) all fees and disbursements of independent
certified public accountants of the Company (including the expenses of any
special audit and comfort letters required by or incident to such
performance).
The Company will, in any event, bear its internal expenses (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), the expenses of any annual audit and
the fees and expenses of any Person, including special experts, retained by
the Company.
12
<PAGE>
(b) In connection with the Underwritten Offering, the Company will
reimburse the Holders of Transfer Restricted Securities being registered
pursuant to the Shelf Registration Statement for the reasonable fees and
disbursements of not more than one counsel, who shall be chosen by the
Holders of a majority in principal amount of the Transfer Restricted
Securities for whose benefit such Registration Statement is being prepared.
SECTION 7. INDEMNIFICATION
(a) The Company and the Trust agree to indemnify and hold harmless (i)
each Participating Holder and (ii) each person, if any, who controls (within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act) any
Participating Holder (any of the persons referred to in this clause (ii)
being hereinafter referred to as a "controlling person") and (iii) the
respective officers, directors, partners, employees, representatives and
agents of any Participating Holder or any controlling person (any person
referred to in clause (i), (ii) or (iii) may hereinafter be referred to as an
"INDEMNIFIED HOLDER"), to the fullest extent lawful, from and against any and
all losses, claims, damages, liabilities, judgments, actions and expenses
(including without limitation and as incurred, reimbursement of all
reasonable costs of investigating, preparing, pursuing or defending any claim
or action, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, including the reasonable fees and expenses of
counsel to any Indemnified Holder) directly or indirectly caused by, related
to, based upon, arising out of or in connection with any untrue statement or
alleged untrue statement of a material fact contained in any Registration
Statement, preliminary prospectus or Prospectus (or any amendment or
supplement thereto), or any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims,
damages, liabilities or expenses are caused by an untrue statement or
omission or alleged untrue statement or omission that is made in reliance
upon and in conformity with information relating to any of the Participating
Holders furnished in writing to the Company by any of the Participating
Holders expressly for use therein. No indemnification shall be made under
this Section 7(a) if the Prospectus is used after notice is given by the
Company pursuant to 5(c) or with respect to a preliminary Prospectus if a
copy of the final Prospectus was not sent or given by the Indemnified Holder
or his agent if required by law to be so delivered and if such final
Prospectus had been delivered, such delivery would have completely cured the
defect giving rise to such loss, claim, damage, liability, judgment, action
or expense.
In case any action or proceeding (including any governmental or
regulatory investigation or proceeding) shall be brought or asserted against
any of the Indemnified Holders with respect to which indemnity may be sought
against the Company and the Trust, such Indemnified Holder (or the
Indemnified Holder controlled by such controlling person) shall promptly
notify the Company and the Trust in writing (PROVIDED, that the failure to
give such notice shall not relieve the Company or the Trust of its
obligations pursuant to this Agreement). Such Indemnified Holder shall have
the right to employ its own counsel in any such action and the reasonable
fees and expenses of such counsel shall be paid, as incurred, by the Company
and the Trust. The Company and the Trust shall not, in connection with any
one such action or proceeding or separate but substantially similar or
related actions or proceedings in the same jurisdiction arising out of the
same general allegations or
13
<PAGE>
circumstances, be liable for the reasonable fees and expenses of more than
one separate firm of attorneys (in addition to any local counsel) at any time
for such Indemnified Holders, which firm shall be designated by the Holders.
The Company and the Trust shall not be liable for any settlement of any such
action or proceeding effected without the Company's prior written consent,
which consent shall not be withheld unreasonably, and the Company and the
Trust agree to indemnify and hold harmless each Indemnified Holder from and
against any loss, claim, damage, liability or expense by reason of any
settlement of any action effected with the written consent of the Company.
The Company shall not, without the prior written consent of each Indemnified
Holder, settle or compromise or consent to the entry of judgment in or
otherwise seek to terminate any pending or threatened action, claim,
litigation or proceeding involving an Indemnified Holder unless such
settlement, compromise, consent or termination includes an unconditional
release of such Indemnified Holder from all liability arising out of such
action, claim, litigation or proceeding.
(b) Each Holder of Transfer Restricted Securities agrees, severally and
not jointly, to indemnify and hold harmless the Company and its directors,
officers, and any person controlling (within the meaning of Section 15 of the
Act or Section 20 of the Exchange Act) the Company and the Trust, its
trustees and their officers, directors, partners, employees, representatives
and agents of each such person, to the same extent as the foregoing indemnity
from the Company and the Trust to each of the Indemnified Holders, but only
with respect to claims and actions based on information relating to such
Holder furnished in writing by such Holder expressly for use in any
Registration Statement or based on the fact that a final Prospectus was not
sent or given by the Holder or his agent if required by law to be so
delivered. In case any action or proceeding shall be brought against the
Company or its directors or officers or any such controlling person or the
Trust or its trustees or their directors or officers or any such controlling
person in respect of which indemnity may be sought against a Holder of
Transfer Restricted Securities, such Holder shall have the rights and duties
given the Company, and the Company and the Trust, such trustees, directors or
officers or such controlling person shall have the rights and duties given to
each Holder by the preceding paragraph. In no event shall any Holder be
liable or responsible for any amount in excess of the amount by which the
total received by such Holder with respect to its sale of Transfer Restricted
Securities pursuant to a Registration Statement exceeds (i) the amount paid
by such Holder for such Transfer Restricted Securities and (ii) the amount of
any damages which such Holder has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission.
(c) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party under Section 7(a) or Section 7(b) hereof
(other than by reason of exceptions provided in those Sections) in respect of
any losses, claims, damages, liabilities or expenses referred to therein,
then each applicable indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages, liabilities or
expenses in such proportion as is appropriate to reflect the relative
benefits received by the Company, on the one hand, and the Holders, on the
other hand, from their sale of Transfer Restricted Securities or if such
allocation is not permitted by applicable law, the relative fault of the
Company, on the one hand, and of the Indemnified Holder, on the other hand,
in connection with the statements or omissions which resulted in such
14
<PAGE>
losses, claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations. The relative fault of the Company and the
Trust, on the one hand, and of the Indemnified Holder, on the other hand,
shall be determined by reference to, among other things, whether the untrue
or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Company or by the Indemnified Holder and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The amount paid or payable by a party as a result of
the losses, claims, damages, liabilities and expenses referred to above shall
be deemed to include, subject to the limitations set forth in the second
paragraph of Section 7(a), any legal or other fees or expenses reasonably
incurred by such party in connection with investigating or defending any
action or claim.
The Company. the Trust and each Holder of Transfer Restricted Securities
agree that it would not be just and equitable if contribution pursuant to
this Section 7(c) were determined by pro rata allocation (even if the Holders
were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations
referred to in the immediately preceding paragraph. The amount paid or
payable by an indemnified party as a result of the losses, claims, damages,
liabilities or expenses referred to in the immediately preceding paragraph
shall be deemed to include, subject to the limitations set forth above, any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7, no Holder or its related
Indemnified Holders shall be required to contribute, in the aggregate, any
amount in excess of the amount by which the total received by such Holder
with respect to the sale of its Transfer Restricted Securities pursuant to a
Registration Statement exceeds the sum of (A) the amount paid by such Holder
for such Transfer Restricted Securities PLUS (B) the amount of any damages
which such Holder has otherwise been required to pay by reason of such untrue
or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f)
of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Holders' obligations to
contribute pursuant to this Section 7(c) are several in proportion to the
respective principal amount of Transfer Restricted Securities and not joint.
SECTION 8. RULE 144A
The Company hereby agrees with each Holder, for so long as any Transfer
Restricted Securities remain outstanding and during any period in which the
Company is not subject to Section 13 or 15(d) of the Securities Exchange Act
of 1934, to make available within a reasonable period of time, upon request
of any Holder or beneficial owner of Transfer Restricted Securities in
connection with any sale thereof and any prospective purchaser of such
Transfer Restricted Securities designated by such Holder or beneficial owner,
the information required by Rule 144A(d)(4) under the Act in order to permit
resales of such Transfer Restricted Securities pursuant to Rule 144A.
15
<PAGE>
SECTION 9. UNDERWRITTEN REGISTRATIONS
No Holder may participate in any Underwritten Registration hereunder
unless such Holder (a) agrees to sell such Holder's Transfer Restricted
Securities on the basis provided in customary underwriting arrangements
entered into in connection therewith and (b) completes and executes all
reasonable questionnaires, powers of attorney, and other documents required
under the terms of such underwriting arrangements.
SECTION 10. SELECTION OF UNDERWRITERS
For any Underwritten Offering, the investment banker or investment
bankers and manager or managers for any Underwritten Offering that will
administer such offering will be selected by the Holders of a majority in
aggregate principal amount of the Transfer Restricted Securities included in
such offering and must be reasonably acceptable to the Company. Such
investment bankers and managers are referred to herein as the "underwriters."
SECTION 11. MISCELLANEOUS
(a) REMEDIES. Each Holder, in addition to being entitled to exercise
all rights provided herein, in the Indenture, the Purchase Agreement or
granted by law, including recovery of liquidated or other damages, will be
entitled to specific performance of its rights under this Agreement. The
Company agrees that monetary damages would not be adequate compensation for
any loss incurred by reason of a breach by them of the provisions of this
Agreement and hereby agree to waive the defense in any action for specific
performance that a remedy at law would be adequate.
(b) NO INCONSISTENT AGREEMENTS. The Company will not, on or after the
date of this Agreement, enter into any agreement with respect to its
securities that is inconsistent with the rights granted to the Holders in
this Agreement or otherwise conflicts with the provisions hereof. The rights
granted to the Holders hereunder do not in any way conflict with and are not
inconsistent with the rights granted to the holders of the Company's
securities under any agreement in effect on the date hereof.
(c) AMENDMENTS AND WAIVERS. The provisions of this Agreement may not
be amended, modified or supplemented, and waivers or consents to or
departures from the provisions hereof may not be given unless (i) in the case
of Section 4 hereof and this Section 11(c)(i), the Company has obtained the
written consent of Holders of all outstanding Transfer Restricted Securities
and (ii) in the case of all other provisions hereof, the Company has obtained
the written consent of Holders of a majority of the then outstanding Transfer
Restricted Securities (on a fully diluted basis). Notwithstanding the
foregoing, a waiver or consent to depart from the provisions hereof with
respect to a matter that relates exclusively to the rights of Holders of
Transfer Restricted Securities whose securities are being sold pursuant to a
Registration Statement and that does not directly or indirectly affect the
rights of other Holders of Transfer Restricted Securities may be given by
Holders of a majority of the Transfer Restricted Securities (on a fully
converted basis) being sold by such Holders pursuant to such
16
<PAGE>
Registration Statement; provided, however, that the provisions of this
sentence may not be amended, modified, or supplemented except in accordance
with the provisions of the immediately preceding sentence.
(d) NOTICES. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class
mail (registered or certified, return receipt requested), telex, telecopier,
or air courier guaranteeing overnight delivery:
(i) if to a Holder, at the address set forth on the records of the
Registrar (as defined in the Indenture) under the Indenture, with a copy to
the Registrar under the Indenture; and
(ii) if to the Company:
Tower Automotive, Inc.
4508 IDS Center
Minneapolis, Minnesota 55402
Telecopier No.: (612) 332-2012
Attention: Scott D. Rued
With a copy to:
Kirkland & Ellis
200 E. Randolph Drive
Chicago, Illinois 60601
Telecopier No.: 312-861-2200
Attention: Dennis M. Myers
(iii) if to the Trust:
Tower Automotive Capital Trust
c/o Tower Automotive, Inc.
4508 IDS Center
Minneapolis, Minnesota 55402
Telecopier No.: (612) 332-2012
Attention: Scott D. Rued
With a copy to:
Kirkland & Ellis
200 E. Randolph Drive
Chicago, Illinois 60601
Telecopier No.: 312-861-2200
Attention: Dennis M. Myers
17
<PAGE>
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five Business
Days after being deposited in the mail, postage prepaid, if mailed; when
receipt acknowledged, if telecopied; and on the next Business Day, if timely
delivered to an air courier guaranteeing overnight delivery.
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address specified in the Indenture.
(e) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit
of and be binding upon the successors and assigns of each of the parties,
including without limitation and without the need for an express assignment,
subsequent Holders of Transfer Restricted Securities; PROVIDED, HOWEVER, that
this Agreement shall not inure to the benefit of or be binding upon a
successor or assign of a Holder unless and to the extent such successor or
assign acquired Transfer Restricted Securities directly from such Holder.
(f) COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
(g) HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(h) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS, WITHOUT REGARD TO THE
CONFLICT OF LAW RULES THEREOF.
(i) SEVERABILITY. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability
of any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
(j) ENTIRE AGREEMENT. This Agreement is intended by the parties as a
final expression of their agreement and intended to be a complete and
exclusive statement of the agreement and understanding of the parties hereto
in respect of the subject matter contained herein. There are no
restrictions, promises, warranties or undertakings, other than those set
forth or referred to herein with respect to the registration rights granted
with respect to the Transfer Restricted Securities. This Agreement
supersedes all prior agreements and understandings between the parties with
respect to such subject matter.
18
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
TOWER AUTOMOTIVE, INC.
By: /s/ Anthony A. Barone
------------------------------------
Title: Vice President and Chief
Financial Officer
TOWER AUTOMOTIVE, INC., as Depositor For
TOWER AUTOMOTIVE CAPITAL TRUST
By: /s/ Anthony A. Barone
------------------------------------
Title: Vice President and Chief
Financial Officer
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
ROBERT W. BAIRD & CO. INCORPORATED
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
PAINEWEBBER INCORPORATED
/s/ Herald L. Ritch
- ---------------------------------------
By: Donaldson, Lufkin & Jenrette
Securities Corporation
By: Herald L. Ritch
------------------------------------
Title: Managing Director
19
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEETS AND STATEMENTS OF OPERATIONS FOUND ON PAGES 4 AND
5 OF THE COMPANY'S FORM 10-Q FOR THE YEAR TO DATE AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000925548
<NAME> TOWER AUTOMOTIVE, INC.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> JUN-30-1998
<CASH> 49,537
<SECURITIES> 0
<RECEIVABLES> 254,581
<ALLOWANCES> 0
<INVENTORY> 77,406
<CURRENT-ASSETS> 475,252
<PP&E> 834,534
<DEPRECIATION> (100,723)
<TOTAL-ASSETS> 1,906,641
<CURRENT-LIABILITIES> 311,542
<BONDS> 0
0
0
<COMMON> 462
<OTHER-SE> 559,505
<TOTAL-LIABILITY-AND-EQUITY> 1,906,641
<SALES> 923,003
<TOTAL-REVENUES> 923,003
<CGS> 788,960
<TOTAL-COSTS> 788,960
<OTHER-EXPENSES> 48,538
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 24,610
<INCOME-PRETAX> 60,895
<INCOME-TAX> 24,360
<INCOME-CONTINUING> 36,535
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 42,566
<EPS-PRIMARY> .92
<EPS-DILUTED> .83
</TABLE>
