<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 2, 1995
REGISTRATION NO. 33-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-------------
TCI COMMUNICATIONS, INC.
AND
TELE-COMMUNICATIONS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE--TCI COMMUNICATIONS, INC. 84-0588868--TCI COMMUNICATIONS, INC.
DELAWARE--TELE-COMMUNICATIONS, INC. 84-1260157--TELE-COMMUNICATIONS, INC.
(STATE OR OTHER JURISDICTION OF (IRS EMPLOYER IDENTIFICATION NO.)
INCORPORATION OR ORGANIZATION)
TERRACE TOWER II
5619 DTC PARKWAY
ENGLEWOOD, COLORADO 80111-3000
(303) 267-5500
(ADDRESS, INCLUDING ZIP CODE AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
STEPHEN M. BRETT, ESQ. COPY TO:
TELE-COMMUNICATIONS, INC. ELIZABETH M. MARKOWSKI, ESQ.
TERRACE TOWER II BAKER & BOTTS, L.L.P.
5619 DTC PARKWAY 885 THIRD AVENUE
ENGLEWOOD, COLORADO 80111-3000 NEW YORK, NEW YORK 10022-4834
(303) 267-5500
(NAME, ADDRESS, INCLUDING ZIP CODE,
AND TELEPHONE NUMBER, INCLUDING AREA
CODE, OF AGENT FOR SERVICE)
-------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this registration statement as determined
by market conditions.
-------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [_]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [X]
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CALCULATION OF REGISTRATION FEE
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<TABLE>
<CAPTION>
PROPOSED PROPOSED
AGGREGATE MAXIMUM MAXIMUM
TITLE OF EACH CLASS OF AMOUNT AGGREGATE AGGREGATE
SECURITIES TO BE TO BE OFFERING OFFERING AMOUNT OF
REGISTERED REGISTERED PRICE PER UNIT PRICE(1)(3) REGISTRATION FEE
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Debt Securities of TCI Communications, Inc... ++
- --------------------------------------------- +
Tele-Communications, Inc., Series A TCI +
Group Common Stock, par value $1.00 per +
share(2).................................... (4) (4) ++ $3,000,000,000 $1,034,482.76(4)
- --------------------------------------------- +
Guarantees by Tele-Communications, Inc. of +
Debt Securities that are convertible into +
Tele-Communications, Inc. Series A TCI +
Group Common Stock.......................... ++
</TABLE>
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(1) In United States dollars or the equivalent thereof in one or more foreign
currencies, foreign currency units or composite currencies.
(2) Includes such presently indeterminate number of shares which may be (a)
issuable from time to time upon conversion of the Debt Securities
registered hereunder and (b) necessary to adjust the number of shares from
time to time reserved for issuance upon such conversion in accordance with
the anti-dilution provisions of the Debt Securities, as a result of a
stock split, stock dividend or other adjustment to or change in the
outstanding shares of Series A TCI Group Common Stock.
(3) Such amount represents the principal amount of any Debt Securities issued
at their principal amount and the issue price rather than the principal
amount of any Debt Securities issued at an original issue discount. No
separate consideration will be received for shares of Series A TCI Group
Common Stock that are issuable upon conversion of Debt Securities that are
convertible into Series A TCI Group Common Stock.
(4) The aggregate amount to be registered and the aggregate offering price per
unit have been omitted pursuant to Securities Act Release No. 6964. The
registration fee has been calculated in accordance with Rule 457(o) under
the Securities Act of 1933.
-------------
THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS
REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH
SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.
================================================================================
<PAGE>
EXPLANATORY NOTE
This Registration Statement contains a Prospectus relating to the offer from
time to time by TCI Communications, Inc. (the "Company") of (a) its Debt
Securities and (b) shares of Tele-Communications, Inc.'s Series A TCI Group
Common Stock ("Series A TCI Group Common Stock") issuable upon conversion of
Debt Securities of the Company that are convertible into Series A TCI Group
Common Stock, with a maximum aggregate initial offering price of up to
$3,000,000,000, and a Prospectus Supplement relating to the offering of up to
$750,000,000 of such Debt Securities as Medium-Term Notes, Series C. Pricing
information and certain other matters concerning the Medium-Term Notes, Series
C, will be included in one or more Pricing Supplements to the Prospectus
Supplement contained herein as Medium-Term Notes, Series C are offered and
sold hereunder. With respect to Debt Securities offered as other than Medium-
Term Notes, Series C, a Prospectus Supplement describing the particular terms
of such Debt Securities, the designation and qualification (to the extent not
already designated and qualified and described in the Prospectus contained
herein) of any trustee with respect to the Debt Securities and the offer or
sale thereof will be filed in accordance with the rules of the Securities and
Exchange Commission.
<PAGE>
PROSPECTUS SUPPLEMENT
(TO PROSPECTUS DATED , 1995)
$750,000,000
TCI COMMUNICATIONS, INC.
MEDIUM-TERM NOTES, SERIES C
DUE NINE MONTHS OR MORE FROM DATE OF ISSUE
---------------
TCI Communications, Inc. (the "Company") may from time to time offer its
unsecured Medium-Term Notes, Series C (the "Notes"), for an aggregate
principal amount of up to $750,000,000 (or the equivalent thereof denominated
in one or more foreign currencies or currency units), subject to reduction as
a result of the sale of other Debt Securities (other than the Notes) pursuant
to the accompanying Prospectus. The Notes will be offered at varying
maturities from nine months or more from their dates of issue. Unless
otherwise set forth in a Pricing Supplement to this Prospectus Supplement
(each, a "Pricing Supplement"), the Notes may not be redeemed at the option of
the Company or repaid at the option of the holder thereof prior to maturity
except in the case of a Put Event. See "Description of Debt Securities--Senior
Debt Securities--Change of Control" in the accompanying Prospectus. The Notes
will bear interest at fixed rates, which may be zero in the case of certain
Notes issued at a price representing a discount from the principal amount
payable at maturity, or variable rates ("Fixed Rate Notes" and "Floating Rate
Notes", respectively). The interest rate in the case of Fixed Rate Notes, the
method of determining the interest rate in the case of Floating Rate Notes,
and the issue price and stated maturity date of each Note will be established
at the time of issuance of such Note and will be set forth in the applicable
Pricing Supplement. Interest rates, the methods of determining interest rates
and issue prices are subject to change by the Company, but no such change will
affect any Note theretofore issued or as to which an offer to purchase has
been accepted by the Company. Unless otherwise described in the applicable
Pricing Supplement, Notes denominated in U.S. Dollars will be issued in
denominations of $1,000 or any integral multiple of $1,000. If the Notes are
to be denominated in one or more foreign currencies or currency units (each a
"Specified Currency"), then the provisions with respect thereto (including
authorized denominations) will be set forth in a foreign currency supplement
hereto ("Multi-Currency Prospectus Supplement") and currency exchange rate
information will be set forth in the applicable Pricing Supplement.
Each Note will be in fully registered form and represented either by a
global certificate registered in the name of a nominee of The Depository Trust
Company ("DTC") or another depositary (DTC or such other depositary, if any,
described in the applicable Pricing Supplement is herein referred to as the
"Depository") (each a "Book-Entry Note"), or a certificate issued in
definitive form ("Certificated Note"), as set forth in the applicable Pricing
Supplement. Beneficial ownership interests in a Book-Entry Note will be shown
on, and the transfer thereof will be effected only through, records maintained
by the Depository's participants. Owners of beneficial interests in Book-Entry
Notes will be entitled to physical delivery of Notes in certificated form
equal in principal amount to their respective beneficial interests only under
the limited circumstances described herein. See "Book-Entry System". Owners of
beneficial interests in Book-Entry Notes will not be considered the holders
thereof.
Unless otherwise described in the applicable Pricing Supplement, interest on
each Fixed Rate Note will accrue from its Original Issue Date (as defined
herein) and will be payable semiannually on each February 15 and August 15 and
at maturity or, if applicable, upon redemption or repayment. The interest rate
on Floating Rate Notes will be calculated by reference to one or more of the
"CD Rate," and "Commercial Paper Rate," the "Federal Funds Rate," the "Prime
Rate," "LIBOR," the "Treasury Rate," or such other interest rate basis or
formula as may be specified in the applicable Pricing Supplement, and may be
adjusted by a "Spread" or "Spread Multiplier," if any, each as defined herein.
Interest on each Floating Rate Note will accrue from its Original Issue Date
and will be payable as set forth therein and in the applicable Pricing
Supplement and at maturity or, if applicable, upon redemption or repayment.
---------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS SUPPLEMENT, ANY PRICING SUPPLEMENT OR THE
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRICE TO AGENTS' PROCEEDS TO
PUBLIC(1) COMMISSIONS(2) COMPANY(2)(3)
- --------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Note............... 100% .125%-.925% 99.875%-99.075%
- --------------------------------------------------------------------------------------------
Total.................. $750,000,000 $937,500-$6,937,500 $749,062,500-$743,062,500
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(1) Each Note will be sold at 100% of its principal amount except as may be
provided in the applicable Pricing Supplement.
(2) The Company will pay a commission to Merrill Lynch & Co., Merrill Lynch,
Pierce, Fenner & Smith Incorporated, CS First Boston Corporation, Lehman
Brothers, Lehman Brothers Inc. or Salomon Brothers Inc or such other
agents as the Company may select (each an "Agent" and together the
"Agents") in the form of a discount, ranging from .125% to .925% of the
principal amount of the Notes sold through such Agent, depending upon the
Stated Maturity Date (as herein defined) and the rating assigned to such
Notes by nationally recognized securities rating agencies. The Company has
reserved the right to sell Notes directly to investors on its own behalf,
in which case no commission will be payable. The Company may sell Notes to
an Agent, as principal. Unless otherwise indicated in the applicable
Pricing Supplement, any Note sold to an Agent as principal will be
purchased by such Agent at a price equal to 100% of the principal amount
thereof less a percentage equal to the commission applicable to an agency
sale of a Note with an identical Stated Maturity Date, and may be resold
by such Agent to investors or other purchasers at prevailing market prices
at the time or times of resale, to be determined by the Agent or, if so
agreed, at a fixed public offering price.
(3) Before deduction of expenses payable by the Company estimated to be
$200,000. The Company has agreed to indemnify each Agent against certain
liabilities, including liabilities under the Securities Act of 1933.
---------------
The Notes are being offered on a continuous basis by the Company through the
Agents, each of which has agreed to use its reasonable best efforts to solicit
offers to purchase the Notes. Notes may also be sold to an Agent, as
principal, for resale to investors or other purchasers. The Company reserves
the right to sell Notes directly to investors on its own behalf in those
jurisdictions where it is authorized to do so. Unless otherwise specified in
an applicable Pricing Supplement, the Notes will not be listed on any
securities exchange, and there can be no assurance that the Notes offered
hereby will be sold or that there will be a secondary market for the Notes.
The Company reserves the right to withdraw, cancel or modify the offer made
hereby without notice. The Company or any Agent, if it solicits such offer,
may reject any offer to purchase Notes, in whole or in part. See "Plan of
Distribution".
---------------
MERRILL LYNCH & CO.
CS FIRST BOSTON
LEHMAN BROTHERS
SALOMON BROTHERS INC
---------------
The date of this Prospectus Supplement is , 1995.
<PAGE>
DESCRIPTION OF NOTES
The following description of the particular terms of the Notes offered
hereby (referred to in the accompanying Prospectus as the "Offered Securities"
and '"Senior Debt Securities") supplements, and to the extent inconsistent
therewith replaces, the description of the general terms and provisions of the
Debt Securities set forth under the heading "Description of Debt Securities"
in the Prospectus, to which reference is hereby made. The following
description will apply to each Note unless otherwise specified in a Multi-
Currency Prospectus Supplement or in the applicable Pricing Supplement.
Capitalized terms not defined herein have the meanings ascribed to them in the
accompanying Prospectus.
GENERAL
The Notes are a series of Senior Debt Securities to be issued under the
indenture, dated as of , 1995 (the "Indenture") between the Company and
The Bank of New York, as trustee (the "Trustee"), which Indenture is more
fully described in the accompanying Prospectus. Whenever any term defined in
the Indenture or the Notes is referred to, such term is incorporated by
reference as part of the statements made herein and such statements are
qualified in their entirety by such reference.
The Indenture does not limit the aggregate principal amount of Senior Debt
Securities that may be issued thereunder, and provides that Senior Debt
Securities may be issued in one or more series up to the aggregate principal
amount that may be authorized from time to time by the Company. The Notes
constitute a single series of Senior Debt Securities for purposes of the
Indenture, which series is unlimited in aggregate principal amount. As of the
date of this Prospectus Supplement, the Company has authorized the issuance
and sale of up to $750,000,000 (or the equivalent thereof denominated in one
or more foreign currencies or currency units) aggregate principal amount of
Notes, and the aggregate principal amount of Notes that may be offered for
sale and sold pursuant to this Prospectus Supplement and the accompanying
Prospectus is limited to the remainder of such amount, subject to reduction as
a result of the sale after the date hereof of other Debt Securities (other
than the Notes) pursuant to the accompanying Prospectus. Unless otherwise
indicated in the applicable Pricing Supplement, currency amounts in this
Prospectus Supplement, the accompanying Prospectus and any Pricing Supplement
are stated in United States dollars ("$", "U.S.$" or "U.S. Dollars").
The Notes are being offered on a continuous basis and each Note will mature
on a Business Day (as defined below) nine months or more from its date of
issue, as selected by the initial purchaser and agreed to by the Company and
as specified in the applicable Pricing Supplement. Unless otherwise specified
in a Note and described in the applicable Pricing Supplement, a Note may not
be redeemed at the option of the Company or repaid at the option of the holder
thereof prior to its Stated Maturity Date (as defined below) except in the
case of a Put Event. See '"Repayment and Redemption" and "Change of Control".
If so provided in a Note and described in the applicable Pricing Supplement,
the Stated Maturity Date of a Note may be extended at the option of the
Company. See "Extension of Maturity". The Notes will be unsecured and
unsubordinated obligations of the Company, will rank equally and ratably with
other unsecured and unsubordinated indebtedness of the Company and will not be
convertible into common stock of the Company.
Unless otherwise specified in such Note and described in a Multi-Currency
Prospectus Supplement and the applicable Pricing Supplement, the Notes will be
denominated in U.S. Dollars and payments of principal of, premium, if any, and
any interest on the Notes will be made in U.S. Dollars. If any Note is to be
denominated other than exclusively in U.S. Dollars, or if the principal of,
premium, if any, or any interest on any Note is to be payable in one or more
currencies (or currency units or in amounts determined by reference to an
index or indices) other than that in which such Note is denominated,
additional information with respect thereto (including authorized
denominations and applicable exchange rate information) will be provided in a
Multi-Currency Prospectus Supplement and the applicable Pricing Supplement.
Unless otherwise described in the applicable Pricing Supplement, Notes
denominated in U.S. Dollars will be issued in denominations of $1,000 or any
integral multiple of $1,000.
S-2
<PAGE>
Each Note will be issued initially as either a Book-Entry Note or a
Certificated Note in fully registered form without coupons. Except as set
forth under "Book-Entry System", owners of beneficial interests in Book-Entry
Notes will not be entitled to physical delivery of Notes in certificated form.
All references herein to holders will be, with respect to Book-Entry Notes, to
the Depository or its nominee. It is currently contemplated that only Notes
denominated in U.S. Dollars will be issued as Book-Entry Notes. See "Book-
Entry System".
Certificated Notes will be exchangeable for Certificated Notes in other
authorized denominations, in an equal aggregate principal amount and otherwise
bearing identical terms and provisions, in accordance with the provisions of
the Indenture. Certificated Notes may be presented for registration of
transfer or for exchange at the office of the Registrar in The City of New
York designated for such purpose (currently the corporate trust department of
the Trustee, 101 Barclay Street, Floor 21 West, New York, New York 10286).
Beneficial interests in Book-Entry Notes may be transferred through a
participating member of the Depository. See "Book-Entry System". No service
charge will be made for any registration of transfer or exchange of any
Certificated Note, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
therewith.
Each Note will bear interest at either (i) a fixed rate, which may be zero
in the case of Fixed Rate Notes issued at an Issue Price (as defined below)
representing a discount from the principal amount payable at maturity (a "Zero
Coupon Note"), or (ii) a floating rate determined by reference to an interest
rate basis or combination of interest rate bases (the "Interest Rate Basis" or
"Interest Rate Bases", as applicable) specified in such Floating Rate Note and
described in the applicable Pricing Supplement, which may be adjusted by a
Spread and/or Spread Multiplier (each as defined below), if any. See "Fixed
Rate Notes" and "Floating Rate Notes".
Unless otherwise specified in a Note and described in a Multi-Currency
Prospectus Supplement and the applicable Pricing Supplement, "Business Day"
means any day, other than a Saturday or Sunday, that is not a day on which
banking institutions are authorized or required by law or regulation to be
closed in The City of New York, and with respect to LIBOR Notes (as defined
below), is also a London Business Day. "London Business Day" means any day on
which dealings in deposits in U.S. Dollars are transacted in the London
interbank market.
"Original Issue Discount Note" means (i) a Note, including any Zero Coupon
Note, that has a stated redemption price at maturity that exceeds its Issue
Price by at least 0.25% of its principal amount multiplied by the number of
full years from the Original Issue Date to the Stated Maturity Date (each as
defined below) for such Note and (ii) any other Note issued with original
issue discount for United States federal income tax purposes as determined
pursuant to Section 1273 of the Internal Revenue Code of 1986, as amended (the
"Code").
The Pricing Supplement relating to each Note will describe the following
terms: (i) the price (expressed as a percentage of the aggregate principal
amount thereof) at which such Note will be issued (the "Issue Price"); (ii)
the date on which such Note will be issued (the "Original Issue Date"); (iii)
the date on which such Note will mature (the "Stated Maturity Date") and
whether the Stated Maturity Date may be extended by the Company, and if so,
the Final Maturity Date (as defined under "Extension of Maturity"); (iv)
whether such Note is a Fixed Rate Note or a Floating Rate Note; (v) if such
Note is a Fixed Rate Note, the rate per annum at which such Note will bear
interest, if any, the interest payment date or dates (if different from those
set forth below under "Fixed Rate Notes") and whether such rate may be changed
by the Company prior to the Stated Maturity Date; (vi) if such Note is a
Floating Rate Note, the Interest Rate Basis or Interest Rate Bases, as
applicable, the Initial Interest Rate, the Interest Reset Period, the Interest
Reset Dates, the Interest Payment Period, the Interest Payment Dates, the
Index Maturity, the Maximum Interest Rate, if any, the Minimum Interest Rate,
if any, the Spread, if any, the Spread Multiplier, if any (all as defined
under '"Interest Rate" and "Floating Rate Notes"), and any other terms
relating to the particular method of calculating the interest rate for such
Note, and whether any such Spread and/or Spread Multiplier may be changed by
the Company prior to the Stated Maturity Date; (vii) whether such Note is an
Original Issue Discount Note, and if so, the yield to maturity; (viii) whether
such
S-3
<PAGE>
Note will be issued initially as a Book-Entry Note or a Certificated Note;
(ix) whether such Note may be redeemed at the option of the Company, or repaid
at the option of the holder, prior to the Stated Maturity Date, and, if so,
the provisions relating to such redemption or repayment; and (x) any other
terms of such Note not inconsistent with the provisions of the Indenture.
REPAYMENT AND REDEMPTION
If agreed to by the initial purchaser of a Note and the Company, such Note
will be subject to repayment at the option of the holder thereof in accordance
with its terms on each optional repayment date therefor, if any (each an
"Optional Repayment Date"). Optional Repayment Dates, if any, will be fixed at
the time of sale and set forth in the applicable Pricing Supplement and
specified in the applicable Note. If no Optional Repayment Date is so
specified with respect to a Note, such Note will not be repayable at the
option of the holder thereof prior to its Stated Maturity Date. Unless
otherwise specified in the Note and described in the applicable Pricing
Supplement, on an Optional Repayment Date, if any, the related Note will be
repayable in whole or in part (provided that the principal amount of the Note
remaining outstanding after a partial repayment is an authorized denomination)
at the option of the holder thereof at a price equal to 100% of the principal
amount to be repaid, together with accrued and unpaid interest thereon up to,
but excluding, the date of repayment (except as otherwise provided below in
the case of an Original Issue Discount Note). In order for a Note to be repaid
upon exercise of such repayment option, the Paying Agent must receive, not
more than 60 nor less than 30 days prior to an Optional Repayment Date (except
as otherwise provided under "Extension of Maturity"), at the office in The
City of New York designated for such purpose (currently the corporate trust
department of the Trustee, at 101 Barclay Street, Floor 21 West, New York, New
York 10286), either (i) the Note, with the form entitled "Option to Elect
Repayment" included in the Note duly completed, or (ii) a facsimile
transmission or letter from a member of a national securities exchange or the
National Association of Securities Dealers, Inc. or a commercial bank or trust
company in the United States setting forth the name of the holder of the Note,
the principal amount of the Note, the principal amount of the Note to be
repaid, the certificate number or a description of the tenor and terms of the
Note, a statement that the option to elect repayment is being exercised
thereby and a guarantee that the Note to be repaid with the form entitled
"Option to Elect Repayment" included in the Note duly completed will be
received by the Paying Agent not later than five Business Days after the date
of such facsimile transmission or letter and such Note and form duly completed
are received by the Paying Agent by such fifth Business Day. Exercise of such
repayment option by the holder thereof will be irrevocable with respect to
each Note for which such repayment election is made except as otherwise
provided under "Extension of Maturity". No transfer or exchange of any Note
(or, in the event that any Note is to be repaid in part, the portion of the
note to be repaid) will be permitted after exercise of a repayment option. All
questions as to the validity, eligibility (including time of receipt) and
acceptance of any Note for repayment will be determined by the Company, which
determination will be final, binding and non-appealable.
In the case of a Book-Entry Note, the Depository's nominee will be the
holder of such Note and therefore will be the only entity that can exercise a
right to repayment. In order to ensure that the Depository's nominee will
timely exercise a right to repayment with respect to a beneficial owner's
interest in a Book-Entry Note, such beneficial owner must instruct the broker
or other direct or indirect participant through which it holds an interest in
such Note to notify the Depository of its desire to exercise a right to
repayment. Different firms have different cut-off times for accepting
instructions from their customers and, accordingly, each beneficial owner
should consult the broker or other direct or indirect participant through
which it holds an interest in a Book-Entry Note in order to ascertain the cut-
off time by which such an instruction must be given in order for timely notice
to be delivered to the Depository.
The Notes will not have a sinking fund unless otherwise described in the
applicable Pricing Supplement. If agreed to by the initial purchaser of a Note
and the Company, such Note will be subject to redemption at the option of the
Company in accordance with its terms on and after a date, if any, fixed at the
time of sale and set forth in the applicable Pricing Supplement and specified
in the applicable Note ("Initial Redemption Date"). If no Initial Redemption
Date is so specified with respect to a Note, such Note will not be redeemable
prior to its Stated Maturity Date. Unless otherwise specified in the Note and
described in the applicable Pricing Supplement,
S-4
<PAGE>
on and after the Initial Redemption Date, if any, the related Note will be
redeemable at any time in whole or from time to time in part (provided that
the principal amount of the Note remaining outstanding after a partial
redemption is an authorized denomination) at the option of the Company at the
applicable Redemption Price (as defined below), together with accrued and
unpaid interest on the principal amount to be redeemed to but excluding the
date of redemption, on notice given by the Company or the Trustee to the
holder thereof not more than 60 nor less than 30 days prior to the date of
redemption. Unless otherwise specified in the Note and described in the
applicable Pricing Supplement, and except as otherwise provided below in the
case of an Original Issue Discount Note, the "Redemption Price" will initially
be the Initial Redemption Percentage, if any, specified in the Note and
described in the applicable Pricing Supplement, of the principal amount of
such Note to be redeemed and, if the Initial Redemption Percentage is greater
than 100%, the Redemption Price will decline at each anniversary of the
Initial Redemption Date by the Annual Redemption Percentage Reduction, if any,
specified in the Note and described in the applicable Pricing Supplement, of
the principal amount thereof to be redeemed until the Redemption Price is 100%
of such principal amount. Whenever less than all of the Notes of the Company
at any time outstanding are to be redeemed, the Company will select the
particular Notes to be so redeemed, provided that if less than all the Notes
of the Company with identical terms at any time outstanding are to be
redeemed, the Notes to be so redeemed will be selected by the Trustee by lot
or such method as the Trustee considers fair and appropriate.
Notwithstanding anything in this Prospectus Supplement to the contrary,
unless otherwise specified in a Note and described in the applicable Pricing
Supplement, if a Note is an Original Issue Discount Note, the amount payable
on such Note in the event of redemption at the option of the Company or
repayment at the option of a holder on an Optional Repayment Date prior to its
Stated Maturity Date shall be the Amortized Face Amount (as defined under
"Payment of Principal and Interest") of such Note calculated as of the date of
such redemption or the date of such repayment, as the case may be.
REPURCHASE
The Company may at any time purchase Notes at any price in the open market
or otherwise. Notes so purchased by the Company may be held or resold or, at
the discretion of the Company, may be surrendered to the Trustee for
cancellation.
CHANGE OF CONTROL
As more fully described in the accompanying Prospectus under the caption
"Description of Debt Securities--Senior Debt Securities--Change of Control",
Section 4.02 of the Indenture provides that, if a Put Event occurs, each
holder of a Note will have the right, as provided in, and subject to the terms
of, the Indenture, to require the Company to repurchase all or any portion of
such holder's Notes at a purchase price equal to 100% of the principal amount
thereof plus accrued and unpaid interest, if any, to the date of repurchase
(or if such Notes are Original Issue Discount Notes, 100% of that portion of
the principal amount thereof that would be payable if the maturity thereof
were accelerated pursuant to the Indenture to the date of repurchase). See
"Payment of Principal and Interest". Unless otherwise specified in a Note and
described in the applicable Pricing Supplement, a Put Event will occur if,
among other things, there is a Change of Control of the Company or, for so
long as the Company is a subsidiary of Tele-Communications, Inc. ("Parent"), a
Change of Control of the Parent, at any time after the Original Issue Date of
a Note and on or prior to the Stated Maturity Date thereof (or, if the Stated
Maturity Date is extended as described under "Extension of Maturity", the
Final Maturity Date). The applicability of this covenant is limited. See
"Description of Debt Securities--Senior Debt Securities--Change of Control"
and "--Definitions" in the accompanying Prospectus. Among other things, it
would not apply to the acquisition of shares of the Company's or the Parent's
common stock by a Controlling Person or by any other person if and for so long
as the shares of such company's common stock beneficially owned by the
Controlling Persons (and, in the case of the Company, by the Parent and
subsidiaries of the Parent) represent in the aggregate thirty percent (30%) or
more of the combined voting power of all shares of such company's common stock
calculated on a fully diluted basis. The term "Controlling Person" includes
each of the Company's Chairman of the Board, its President and each director
of the Company as of the date of the
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Indenture, their respective family members, estates and heirs, Kearns-Tribune
Corporation and the trustee under the Parent's Employee Stock Purchase Plan or
any successor plan or any other employee stock ownership or other employee
benefit plan of the Parent or the Company or any subsidiary of the Parent or
the Company. See "Description of Debt Securities--Senior Debt Securities--
Definitions" in the accompanying Prospectus.
The Company's payment obligations with respect to the Notes, including its
obligation to pay the purchase price of a Note the holder of which has elected
to require the Company to repurchase such Note following the occurrence of a
Put Event, are unsecured, unsubordinated obligations of the Company and are
pari passu (equal and ratable) with other unsecured, unsubordinated
indebtedness of the Company. There are other issues of senior indebtedness of
the Company outstanding in addition to the Notes that would permit the holders
to require the Company to repurchase or repay such indebtedness upon the
occurrence of a Put Event or events similar thereto and the Company
anticipates that it will continue to issue indebtedness with similar covenants
in the future. Approximately $6.30 billion of the Company's outstanding
indebtedness at June 30, 1995 included provisions that would permit the
holders to require the Company to repurchase or repay such indebtedness upon
the occurrence of a Put Event, a Change of Control or events similar thereto,
which obligation of the Company would rank on a parity with its repurchase
obligation with respect to the Notes. In addition, approximately $2.67 billion
of the outstanding indebtedness of the Company's subsidiaries at June 30, 1995
included provisions that require the applicable subsidiary to repurchase or
repay such indebtedness upon a Change of Control or events similar thereto.
See "Description of Debt Securities" in the accompanying Prospectus. If a Put
Event were to occur, there can be no assurance that the Company would have
sufficient funds to satisfy its repurchase obligations with respect to the
Notes and such other indebtedness. The failure of the Company to repurchase a
Note which the holder has elected to require it to repurchase following the
occurrence of a Put Event would constitute an Event of Default with respect to
the Notes and may cause the acceleration of the maturity of other indebtedness
of the Company after notice and/or passage of time.
No amendment, supplement or waiver may be made to the Indenture or to the
Notes which would materially adversely affect the rights of any holder of
Notes to require the Company to purchase such Notes upon the occurrence of a
Put Event without the consent of the holder of each outstanding Note.
PAYMENT OF PRINCIPAL AND INTEREST
The principal of, premium, if any, and interest, if any, on each Note are
payable by the Company in U.S. Dollars, unless otherwise specified in a Note
and described in a Multi-Currency Prospectus Supplement and the applicable
Pricing Supplement.
Principal of, premium, if any, and interest, if any, on any Certificated
Note will be payable when due upon presentation and surrender of such Note at
the office of the Paying Agent in The City of New York designated for such
purpose (currently the corporate trust department of the Trustee, 101 Barclay
Street, Floor 21 West, New York, New York 10286); provided, however, that
payment of interest, other than interest payable on the Stated Maturity Date
or on the date of redemption or repayment if a Note is redeemed or repaid
prior to maturity (such Stated Maturity Date or date of redemption or
repayment with respect to any Note, as the case may be, being collectively
referred to herein as the "Maturity Date" with respect to the amount of
principal and any premium and interest payable on such date) may be made by
mailing a check to the holder at the address of such holder appearing on the
security register for the Notes at the close of business on the applicable
Regular Record Date (as defined below). Notwithstanding the foregoing, a
holder of $10,000,000 or more in aggregate principal amount of Certificated
Notes having the same Interest Payment Dates (as defined below) shall be
entitled to receive such interest payments in U.S. Dollars by wire transfer of
immediately available funds to an account at a bank in The City of New York
(or other bank consented to by the Paying Agent and the Company) designated by
such holder (provided that such bank has appropriate facilities therefor), but
only if appropriate payment instructions in writing have been received by the
Paying Agent not less than 16 calendar days prior to the applicable Interest
Payment Date. Unless otherwise specified in the applicable Pricing Supplement
(and subject to extension as provided under "Extension of Maturity"), payments
of principal of and any premium and interest on Certificated Notes will be
made on the Maturity Date in immediately available funds, provided that the
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Certificated Notes to be paid are presented and surrendered to the Paying
Agent as provided above in time for the Paying Agent to make such payments in
such funds in accordance with its normal procedures. Such payments will be
made by wire transfer to an account at a bank in The City of New York (or
other bank consented to by the Paying Agent and the Company) designated by the
holder of the Notes (provided that such bank has appropriate facilities
therefor), provided that wire transfer instructions in writing have been
received by the Paying Agent not less than 16 calendar days prior to such
Maturity Date. Beneficial owners of Book-Entry Notes will be paid in
accordance with the Depository's and its participants' procedures in effect
from time to time. See "Book-Entry System". If required by applicable law or
instructed by the Company or any governmental agency that taxes or other
governmental charges should be withheld, the Paying Agent shall withhold any
such taxes or other governmental charges on any payments made in connection
with any Note.
Unless otherwise specified in a note and described in the applicable Pricing
Supplement, if the principal of any Original Issue Discount Note is declared
to be, or automatically becomes, due and payable immediately as described in
the accompanying Prospectus under "Description of Debt Securities--Defaults
and Remedies", the amount of principal due and payable with respect to such
Note shall be the Amortized Face Amount of such Note calculated as of the date
of such acceleration of the maturity of such Note. The "Amortized Face Amount"
of an Original Issue Discount Note as of any date for which a calculation is
being made shall be an amount equal to (i) the Issue Price set forth in the
applicable Pricing Supplement plus (ii) the portion of the difference between
the Issue Price and the principal amount of such Note that has accrued at the
yield to maturity set forth in the Pricing Supplement (computed in accordance
with generally accepted United States bond yield computation principles) to
the date with respect to which such calculation is being made, but in no event
shall the Amortized Face Amount of an original Issue Discount Note exceed its
principal amount.
Interest on any Note will be payable on each date specified on which an
installment of interest is due and payable ("Interest Payment Date") and at
the Maturity Date. Unless otherwise indicated in the applicable Pricing
Supplement and specified in the Note, the Interest Payment Dates for Fixed
Rate Notes will be as described below under "Fixed Rate Notes" and the
Interest Payment Dates for Floating Rate Notes will be determined in the
manner described below under "Floating Rate Notes". Unless otherwise indicated
in the applicable Pricing Supplement and specified in the Note, interest
payable and punctually paid or duly provided for on any Interest Payment Date
will be paid to the person in whose name such Note is registered at the close
of business on the Regular Record Date immediately preceding such Interest
Payment Date; provided, however, that unless otherwise specified in such Note
and the applicable Pricing Supplement the first payment of interest on any
Note with an Original Issue Date between a Regular Record Date and the next
succeeding Interest Payment Date or on an Interest Payment Date will be made
on the Interest Payment Date following the next succeeding Regular Record Date
to the registered holder on such next succeeding Regular Record Date;
provided, further, that interest payable at the Maturity Date will be payable
to the person to whom principal shall be payable. "Regular Record Date" means
the date as of which a Note must be registered in a person's name in order for
such person to receive an interest payment on the next succeeding Interest
Payment Date. Unless otherwise indicated in the applicable Pricing Supplement
and specified in the Note, the Regular Record Date for an Interest Payment
Date will be the fifteenth calendar day (whether or not a Business Day)
immediately preceding such Interest Payment Date.
Unless otherwise specified in a Note and described in the applicable Pricing
Supplement, all percentages resulting from any calculations will be rounded,
if necessary, to the nearest one hundred-thousandth of a percentage point
(with five one-millionths of a percentage point being rounded upward), and all
U.S. Dollar amounts used in or resulting from such calculation shall be
rounded to the nearest cent (with one-half cent being rounded upward).
The interest rate on the Notes will in no event be higher than the maximum
rate permitted by New York law as the same may be modified by United States
law of general application. Under present New York law, the maximum rate of
interest is 25% per annum on a simple interest basis, with certain exceptions.
This limit may not apply to Notes in which $2,500,000 or more has been
invested.
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INTEREST RATE
The applicable Pricing Supplement relating to Fixed Rate Notes will
designate a fixed rate of interest per annum (which may be zero in the event
such Notes are Zero Coupon Notes) payable on such Notes. See "Fixed Rate
Notes" and "Zero Coupon Notes".
Each Floating Rate Note will bear interest at a rate determined by reference
to an Interest Rate Basis or two or more interest Rate Bases which may be
adjusted in either case by adding or subtracting a Spread ("Spread" is the
number of basis points (one basis point equals one-hundredth of a percentage
point) specified in a Note and described in the applicable Pricing Supplement
as being applicable to the interest rate for such Floating Rate Note), if any,
or by multiplying by the Spread Multiplier ("Spread Multiplier" is the
percentage specified in a Note and described in the applicable Pricing
Supplement as being applicable to the interest rate for such Floating Rate
Note), if any. The "Index Maturity" is the period to maturity of the
instrument or obligation with respect to which the Interest Rate Basis or
Bases will be calculated. A Floating Rate Note may also have either or both of
the following: (i) a maximum limitation, or ceiling, on the rate of interest
which may accrue during any interest period ("Maximum Interest Rate"); and
(ii) a minimum limitation, or floor, on the rate of interest which may accrue
during any interest period ("Minimum Interest Rate").
The applicable Pricing Supplement relating to Floating Rate Notes will
designate, and each Floating Rate Note will specify, one or more of the
following Interest Rate Bases as applicable to the relevant Note: (a) the
Commercial Paper Rate, in which case such Note will be a Commercial Paper Rate
Note, (b) the Certificate of Deposit Rate (the "CD Rate"), in which case such
note will be a CD Rate Note; (c) the Federal Funds Rate, in which case such
Note will be a Federal Funds Rate Note; (d) the Prime Rate, in which case such
Note will be a Prime Rate Note; (e) London Interbank Offered Rate ("LIBOR"),
in which case such Note will be a LIBOR Note; (f) the Treasury Rate, in which
case such Note will be a Treasury Rate Note; or (g) such other interest rate
basis or formula as is set forth in such Pricing Supplement. A Floating Rate
Note may bear interest at a rate determined by reference to two or more
Interest Rate Bases (other than the Treasury Rate) and, if so, the applicable
Pricing Supplement will describe the Interest Rate Bases applicable to such
Note.
Interest rates, interest rate formulas and other variable terms of a Note
are subject to change by the Company from time to time, but no such change
will affect any Note already issued or as to which an offer to purchase has
been accepted by the Company.
FIXED RATE NOTES
Unless otherwise described in the applicable Pricing Supplement, each Fixed
Rate Note will bear interest (which may be zero in the event such Note is a
Zero Coupon Note) from the Original Issue Date at the rate per annum stated on
the face thereof until the principal thereof is paid or made available for
payment. Unless otherwise specified in the Note and described in the
applicable Pricing Supplement and except as described below under "Extension
of Maturity", interest, to the extent payable, will be payable semiannually on
the "Interest Payment Dates" therefor (which will be on February 15 and August
15 of each year) and on the Maturity Date. Interest will be computed on the
basis of a 360-day year of twelve, 30-day months. Interest payments on a Fixed
Rate Note shall include interest accrued from and including the Original Issue
Date of such Note, or the most recent date to which interest has been paid or
duly provided for, as the case may be, to, but excluding, the related Interest
Payment Date or Maturity Date, as the case may be. If any Interest Payment
Date or Maturity Date for a Fixed Rate Note falls on a day that is not a
Business Day, the related payment of principal, premium, if any, and interest,
if any, will be made on the next succeeding Business Day as if it were made on
the date such payment were due, and no interest will accrue on the amount so
payable for the period from and after such Interest Payment Date or Maturity
Date, as the case may be.
FLOATING RATE NOTES
Each Floating Rate Note will specify and the applicable Pricing Supplement
will describe the Interest Rate Basis or Bases and the Spread and/or Spread
Multiplier, if any, and the Maximum Interest Rate and/or
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Minimum Interest Rate, in each case if any, applicable to each Floating Rate
Note. In addition, each Floating Rate Note will specify and the applicable
Pricing Supplement will describe or particularize all applicable variable
terms of such Floating Rate Note. Unless otherwise described in the applicable
Pricing Supplement, each Floating Rate Note will bear interest at the rate or
rates per annum determined in accordance with the interest rate formula so
specified therein and described in the applicable Pricing Supplement from the
Original Issue Date until the principal thereof is paid or made available for
payment.
Floating Rate Notes will have daily, weekly, monthly, quarterly, semiannual
or annual resets of the rate of interest (such period applicable to a Note
being the "Interest Reset Period" for such Note, and the first day of each
Interest Reset Period being an "Interest Reset Date"), which will be described
in the applicable Pricing Supplement and specified in the Note. Unless
otherwise so specified, the Interest Reset Date will be, in the case of
Floating Rate Notes which reset daily, each Business Day; in the case of
Floating Rate Notes which reset weekly, Wednesday of each week (with the
exception of weekly reset Treasury Rate Notes which will reset Tuesday of each
week, except as specified below); in the case of Floating Rate Notes which
reset monthly, the third Wednesday of each month; in the case of Floating Rate
Notes which reset quarterly, the third Wednesday of March, June, September and
December; in the case of Floating Rate Notes which reset semiannually, the
third Wednesday of the two months specified in such Note and described in the
applicable Pricing Supplement; and in the case of Floating Rate Notes which
reset annually, the third Wednesday of the month specified in such Note and
described in the applicable Pricing Supplement. If any Interest Reset Date for
any Floating Rate Note would otherwise be a day that is not a Business Day,
such Interest Reset Date will be postponed to the next succeeding day that is
a Business Day, except that in the case of a LIBOR Note, if such Business Day
is in the next succeeding calendar month, such Interest Reset Date shall be
the next preceding Business Day.
The interest rate applicable to each Interest Reset Period commencing on the
Interest Reset Date with respect to such Interest Reset Period will be the
rate determined by reference to the Interest Rate Basis or Bases on the
applicable "Interest Determination Date". The Interest Determination Date with
respect to the Commercial Paper Rate, the CD Rate, the Federal Funds Rate and
the Prime Rate will be the second Business Day preceding each Interest Reset
Date for the related Note. The Interest Determination Date with respect to
LIBOR will be the second London Business Day preceding each Interest Reset
Date for the related Note. The Interest Determination Date with respect to the
Treasury Rate, unless otherwise specified in the related Treasury Rate Note,
will be the day of the week in which the related Interest Reset Date falls on
which Treasury Bills (as defined under "Treasury Rate" below) of the
applicable Index Maturity are auctioned. Treasury Bills are normally sold at
auction on Monday of each week unless that day is a legal holiday, in which
case the auction is normally held on the following Tuesday, except that such
auction may be held on the preceding Friday. If, as a result of a legal
holiday, an auction is so held on the preceding Friday, such Friday will be
the Interest Determination Date for the Interest Reset Date occurring in the
next succeeding week. If an auction date falls on any Interest Reset Date for
a Treasury Rate Note, then such Interest Reset Date will instead be the first
Business Day following such auction date. The Interest Determination Date for
a Floating Rate Note the interest rate of which is determined by reference to
two or more Interest Rate Bases will be the first Business Day which is at
least two Business Days prior to the related Interest Reset Date for such Note
on which each Interest Rate Basis shall be determinable. Each Interest Rate
Basis will be determined on the Interest Determination Date, and the
applicable interest rate shall take effect on the related Interest Reset Date.
Interest on each Floating Rate Note will be payable monthly, quarterly,
semiannually or annually (the "Interest Payment Period"). Except as provided
below or in the applicable Pricing Supplement, interest will be payable in the
case of Floating Rate Notes which reset: (i) daily, weekly or monthly, on the
third Wednesday of each month or on the third Wednesday of March, June,
September and December of each year as specified in such Note and the
applicable Pricing Supplement; (ii) quarterly, on the third Wednesday of
March, June, September and December of each year; (iii) semiannually, on the
third Wednesday of the two months of each year specified in such Note and the
applicable Pricing Supplement; and (iv) annually, on the third Wednesday of
the month of each year specified in such Note and the applicable Pricing
Supplement (each, an "Interest Payment Date") and, in each case, at maturity.
If any Interest Payment Date for any Floating Rate Note would otherwise be a
day that is not a Business Day, such Interest Payment Date will be postponed
to the next day that is a
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Business Day except, in the case of a LIBOR Note, if such Business Day is in
the next succeeding calendar month, such Interest Payment Date will be the
immediately preceding Business Day. If the maturity Date of any Floating Rate
Note falls on a day that is not a Business Day, the related payment of
principal, premium, if any, and interest, will be made on the next succeeding
Business Day as if it were made on the date such payment was due, and no
interest will accrue on the amounts so payable for the period from and after
such date.
Interest payments on each Interest Payment Date for Floating Rate Notes
(except in the case of Floating Rate Notes that reset daily or weekly) will
include accrued interest from and including the Original Issue Date, or the
most recent date to which interest has been paid or duly provided for, as the
case may be, to, but excluding, such Interest Payment Date or the Maturity
Date, as the case may be. Unless otherwise specified in such Note and
described in the applicable Pricing Supplement, in the case of Floating Rate
Notes that reset daily or weekly, interest payments will include accrued
interest from and including the Original Issue Date or from but excluding the
last date in respect of which interest has been paid or duly provided for, as
the case may be, to, and including, the Regular Record Date immediately
preceding the applicable Interest Payment Date, and at maturity the interest
payments will include accrued interest from and including the Original Issue
Date, or from but excluding the last date in respect of which interest has
been paid or duly provided for, as the case may be, to, but excluding, the
Maturity Date.
With respect to each Floating Rate Note, accrued interest will be calculated
by multiplying the principal amount thereof by an accrued interest factor.
Such accrued interest factor will be computed by adding the interest factors
calculated for each day in the period for which accrued interest is being
calculated. The interest factor (expressed as a decimal) for each such day
will be computed by dividing the interest rate in effect for such day by 360,
in the case of Notes having as their Interest Rate Basis the CD Rate,
Commercial Paper Rate, Federal Funds Rate, LIBOR or the Prime Rate, or by the
actual number of days in the year, in the case of Notes having as their
Interest Rate Basis the Treasury Rate. The interest rate in effect on each day
will be (a) if such day is an Interest Reset Date, the interest rate with
respect to the Interest Determination Date pertaining to such Interest Reset
Date, or (b) if such day is not an Interest Reset Date, the interest rate with
respect to the Interest Determination Date pertaining to the next preceding
Interest Reset Date, subject in either case to any Maximum Interest Rate or
Minimum Interest Rate limitation and to any adjustment by a Spread and/or
Spread Multiplier; provided, however, that (i) the interest rate in effect for
the period from the Original Issue Date to the initial Interest Reset Date
("Initial Interest Reset Rate") will be the rate specified as such in the
Floating Rate Note ("Initial Interest Rate") and (ii) unless otherwise
described in the applicable Pricing Supplement and specified in the Note the
interest rate in effect for the ten days immediately prior to a Maturity Date
will be that in effect on the tenth calendar day preceding such Maturity Date.
Unless otherwise described in the applicable Pricing Supplement and specified
in the Note, the interest factor for each Floating Rate Note for which the
interest rate is calculated with reference to two or more Interest Rate Bases
will be calculated in each period in the same manner as if only one of the
applicable Interest Rate Bases applied.
Unless otherwise specified in a Floating Rate Note and described in the
applicable Pricing Supplement, the Trustee will be the Calculation Agent with
respect to each Floating Rate Note. The Calculation Agent is currently located
at 101 Barclay Street, New York, New York 10286 (telephone number: (212) 815-
5375; facsimile number: (212) 815-5915). Upon request of the holder of any
Floating Rate Note, the Calculation Agent will provide the interest rate then
in effect and, if determined, the interest rate that will become effective on
the next Interest Reset Date with respect to such Floating Rate Note. Any such
calculation by the Calculation Agent shall, absent manifest error, be
conclusive and binding for all purposes.
The "Calculation Date," if applicable, pertaining to any Interest
Determination Date will be the earlier of (i) the tenth calendar day after
such Interest Determination Date, or, if such day is not a Business Day, the
next succeeding Business Day or (ii) the Business Day immediately preceding
the applicable Interest Payment Date or Maturity Date, as the case may be.
CD RATE
Unless otherwise specified in such Note and described in the applicable
Pricing Supplement, "CD Rate" means, with respect to any Interest
Determination Date relating to a CD Rate Note or any Interest Determination
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Date for a Floating Rate Note for which one of the Interest Rate Bases is the
CD Rate (a "CD Rate Interest Determination Date"), the rate on such date for
negotiable certificates of deposit having the Index Maturity described in the
applicable Pricing Supplement as published by the Board of Governors of the
Federal Reserve System in "Statistical Release H.15(519), Selected Interest
Rates" or any successor publication of the Board of Governors of the Federal
Reserve System ("H.15(519)") under the heading "CDs (Secondary Market)" or, if
not so published by 3:00 p.m., New York City time, on the Calculation Date
pertaining to such CD Rate Interest Determination Date, the CD Rate will be
the rate on such CD Rate Interest Determination Date for negotiable
certificates of deposit of the Index Maturity described in the applicable
Pricing Supplement as published by the Federal Reserve Bank of New York in its
daily statistical release, "Composite 3:30 p.m. Quotations for U.S. Government
Securities" or any successor publication of the Federal Reserve Bank of New
York ("Composite Quotations") under the heading "Certificates of Deposit". If
such rate is not yet published in either H.15(519) or Composite Quotations by
3:00 p.m., New York City time, on the Calculation Date pertaining to such CD
Rate Interest Determination Date, then the CD Rate for such CD Rate Interest
Determination Date will be calculated by the Calculation Agent and will be the
arithmetic mean (rounded, if necessary, to the nearest one hundred-thousandth
of a percentage point) of the secondary market offered rates, as of
approximately 10:00 a.m., New York City time, on such CD Rate Interest
Determination Date, of three leading nonbank dealers (which, unless otherwise
described in the applicable Pricing Supplement, may include an affiliate of
the Calculation Agent or an Agent) in negotiable U.S. Dollar certificates of
deposit in The City of New York selected by the Calculation Agent, for
negotiable certificates of deposit of major United States money center banks
(in the market for negotiable certificates of deposit) with a remaining
maturity closest to the Index Maturity designated in the Pricing Supplement in
a denomination of U.S. $5,000,000; provided, however, that if the dealers
selected as aforesaid by the Calculation Agent are not quoting as mentioned in
this sentence, the CD Rate will be the CD Rate determined with respect to the
immediately preceding CD Rate Interest Determination Date or, in the case of
the first CD Rate Interest Determination Date, the Initial Interest Rate.
CD Rate Notes and other Notes are not deposit obligations of a bank and are
not insured by the Federal Deposit Insurance Corporation.
COMMERCIAL PAPER RATE
Unless otherwise specified in such Note and described in the applicable
Pricing Supplement, "Commercial Paper Rate" means, with respect to any
Interest Determination Date relating to a Commercial Paper Rate Note or any
Interest Determination Date for a Floating Rate Note for which one of the
Interest Rate Bases is the Commercial Paper Rate (a "Commercial Paper Rate
Interest Determination Date"), the Money Market Yield (as defined below) of
the rate on such date for commercial paper having the Index Maturity described
in the applicable Pricing Supplement as published in H.15(519) under the
heading "Commercial Paper". In the event that such rate is not so published
prior to 3:00 p.m., New York City time, on the Calculation Date pertaining to
such Commercial Paper Rate Interest Determination Date, then the Commercial
Paper Rate will be the Money Market Yield of the rate on such Commercial Paper
Rate Interest Determination Date for commercial paper of the Index Maturity
described in the applicable Pricing Supplement as published in Composite
Quotations under the heading "Commercial Paper". If by 3:00 p.m., New York
City time, on the Calculation Date pertaining to such Commercial Paper Rate
Interest Determination Date such rate is not yet published in either H.15(519)
or Composite Quotations, the Commercial Paper Rate for such Commercial Paper
Rate Interest Determination Date will be calculated by the Calculation Agent
and will be the Money Market Yield of the arithmetic mean (rounded, if
necessary, to the nearest one hundred-thousandth of a percentage point) of the
offered rates, as of approximately 11:00 a.m., New York City time on such
Commercial Paper Rate Interest Determination Date, of three leading dealers of
commercial paper (which, unless otherwise described in the applicable Pricing
Supplement, may include an affiliate of the Calculation Agent or an Agent) in
The City of New York selected by the Calculation Agent, for commercial paper
having the Index Maturity described in the applicable Pricing Supplement
placed for an industrial issuer whose bond rating is "AA" or its equivalent,
from a nationally recognized securities rating agency; provided, however, that
if the dealers selected as aforesaid by the Calculation Agent are not quoting
as mentioned in this sentence, the Commercial Paper Rate will be the
Commercial Paper
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Rate determined with respect to the immediately preceding Commercial Paper
Rate Interest Determination Date or, in the case of the first Commercial Paper
Rate Interest Determination Date, the Initial Interest Rate.
"Money Market Yield" shall be a yield (expressed as a percentage rounded, if
necessary, to the nearest one hundred-thousandth of a percentage point)
calculated in accordance with the following formula:
D X 360
MONEY MARKET YIELD = -------------------- X 100
360 - (D X M)
where "D" refers to the applicable per annum rate for commercial paper quoted
on a bank discount basis and expressed as a decimal, and "M" refers to the
actual number of days in the interest period for which interest is being
calculated.
FEDERAL FUNDS RATE
Unless otherwise specified in such Note and described in the applicable
Pricing Supplement, "Federal Funds Rate" means, with respect to any Interest
Determination Date relating to a Federal Funds Rate Note or any Interest
Determination Date for a Floating Rate Note for which one of the Interest Rate
Bases is the Federal Funds Rate (a "Federal Funds Rate Interest Determination
Date"), the rate on such date for Federal Funds as published in H.15(519)
under the heading "Federal Funds (Effective)" or, if not so published by 3:00
p.m., New York City time, on the Calculation Date pertaining to such Federal
Funds Rate Interest Determination Date, the Federal Funds Rate will be the
rate on such Federal Funds Rate Interest Determination Date for Federal Funds
as published in Composite Quotations under the heading "Federal
Funds/Effective Rate". If such rate is not yet published in either H.15(519)
or Composite Quotations by 3:00 p.m., New York City time on the Calculation
Date pertaining to such Federal Funds Rate Interest Determination Date, the
Federal Funds Rate for such Federal Funds Rate Interest Determination Date
will be calculated by the Calculation Agent and will be the arithmetic mean
(rounded, if necessary, to the nearest one hundred-thousandth of a percentage
point) of the rates, as of approximately 9:00 a.m., New York City time, on
such Federal Funds Rate Interest Determination Date, for the last transaction
in overnight Federal Funds arranged by three leading brokers of Federal Funds
transactions in The City of New York selected by the Calculation Agent;
provided, however, that if the brokers selected as aforesaid by the
Calculation Agent are not quoting as mentioned in this sentence, the Federal
Funds Rate will be the Federal Funds Rate determined with respect to the
immediately preceding Federal Funds Rate Interest Determination Date or, in
the case of the first Federal Funds Rate Interest Determination Date, the
Initial Interest Rate.
PRIME RATE
Unless otherwise specified in such Note and described in the applicable
Pricing Supplement, "Prime Rate" means, with respect to any Interest
Determination Date relating to a Prime Rate Note or any Interest Determination
Date for a Floating Rate Note for which one of the Interest Rate Bases is the
Prime Rate (a "Prime Rate Interest Determination Date"), the arithmetic mean
(rounded, if necessary, to the nearest one hundred-thousandth of a percentage
point), as calculated by the Calculation Agent, of the prime rates quoted on
the basis of the actual number of days in the year divided by 360 as of the
close of business on such Prime Rate Interest Determination Date by three
major money center banks in The City of New York selected by the Calculation
Agent (after consultation with the Company). If fewer than three quotations
are provided, the Prime Rate will be calculated by the Calculation Agent (as
described above) on the basis of the prime rates quoted in The City of New
York by the appropriate number of substitute banks or trust companies
organized and doing business under the laws of the United States, or any state
thereof, each having total equity capital of at least $500 million and being
subject to supervision or examination by a Federal or state authority,
selected by the Calculation Agent (after consultation with the Company) to
quote such rate or rates; provided, however, that if the banks or trust
companies selected as aforesaid by the Calculation Agent are not quoting as
mentioned in this sentence, the Prime Rate will be the Prime Rate determined
with respect to the immediately preceding Prime Rate Interest Determination
Date or, in the case of the first Prime Rate Interest Determination Date, the
Initial Interest Rate.
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LIBOR
Unless otherwise specified in such Note and described in the applicable
Pricing Supplement, "LIBOR" will be determined by the Calculation Agent in
accordance with the following provisions:
(i) With respect to any Interest Determination Date relating to a LIBOR
Note or any Interest Determination Date for a Floating Rate Note for which
one of the Interest Rate Bases is LIBOR ("LIBOR Interest Determination
Date"), LIBOR will be, as specified in the Note and described in the
applicable Pricing Supplement, either: (a) the arithmetic mean (rounded, if
necessary, to the nearest one hundred-thousandth of a percentage point) of
the offered rates, as calculated by the Calculation Agent, for deposits in
U.S. Dollars of not less than U.S. $1,000,000 having the Index Maturity
described in the applicable Pricing Supplement, commencing on the second
London Business Day immediately following such LIBOR Interest Determination
Date, which appear on the Reuters Screen LIBO Page (as defined below) as of
approximately 11:00 a.m., London time, on such LIBOR Interest Determination
Date, if at least two such offered rates appear on the Reuters Screen LIBO
Page ("LIBOR Reuters"), or (b) the rate for deposits in U.S. Dollars of not
less than U.S. $1,000,000 having the Index Maturity designated in the
applicable Pricing Supplement, commencing on the second London Business Day
immediately following such LIBOR Interest Determination Date, which appears
on the Telerate Page 3750 (as defined below) as of approximately 11:00
a.m., London time, on such LIBOR Interest Determination Date ("LIBOR
Telerate"). "Reuters Screen LIBO Page" means the display designated as page
"LIBO" on the Reuters Monitor Money Rates Service (or such other page as
may replace the LIBO page on that service for the purpose of displaying
London interbank offered rates of major banks). "Telerate Page 3750" means
the display designated on page '"3750" on the Telerate Service (or such
other page as may replace the 3750 page on that service or such other
service or services as may be nominated by the British Bankers' Association
for the purpose of displaying London interbank offered rates for U.S.
Dollar deposits). If neither LIBOR Reuters nor LIBOR Telerate is specified
in the Note and applicable Pricing Supplement, LIBOR will be determined as
if LIBOR Telerate had been specified. If fewer than two offered rates
appear on the Reuters Screen LIBO Page, or if no rate appears on the
Telerate Page 3750, as applicable, LIBOR in respect of that LIBOR Interest
Determination Date will be determined as if the parties had specified the
rate described in (ii) below.
(ii) With respect to a LIBOR Interest Determination Date on which fewer
than two offered rates appear on the Reuters Screen LIBO Page as described
in (i)(a) above, or on which no rate appears on Telerate Page 3750, as
specified in (i)(b) above, as applicable, the Calculation Agent shall
request the principal London offices of each of four major reference banks
in the London interbank market selected by the Calculation Agent to provide
the Calculation Agent with a quotation of the rate at which deposits in
U.S. Dollars for the period of the Index Maturity described in the
applicable Pricing Supplement, commencing on the second London Business Day
immediately following such LIBOR Interest Determination Date, are offered
by it to prime banks in the London interbank market as of approximately
11:00 a.m., London time, on such LIBOR Interest Determination Date and in a
principal amount equal to an amount of not less than U.S. $1,000,000 that
is representative for a single transaction in such market at such time. If
at least two such quotations are provided, LIBOR in respect of such LIBOR
Interest Determination Date will be the arithmetic mean (rounded, if
necessary, to the nearest one hundred-thousandth of a percentage point) of
such quotations as calculated by the Calculation Agent. If fewer than two
quotations are provided, LIBOR for such LIBOR Interest Determination Date
will be the arithmetic mean (rounded, if necessary, to the nearest one
hundred-thousandth of a percentage point) of the rates quoted as of
approximately 11:00 a.m., New York City time, on such LIBOR Interest
Determination Date by three major banks in The City of New York selected by
the Calculation Agent (after consultation with the Company) for loans in
U.S. Dollars to leading European banks, having the Index Maturity described
in the applicable Pricing Supplement commencing on the second London
Business Day immediately following such LIBOR Interest Determination Date
and in a principal amount equal to an amount of not less than U.S.
$1,000,000 that is representative for a single transaction in such market
at such time; provided, however, that if the banks selected as aforesaid by
the Calculation Agent are not quoting as mentioned in this sentence, LIBOR
will be the LIBOR determined with respect to the immediately preceding
LIBOR Interest Determination Date or, in the case of the first LIBOR
Interest Determination Date, the Initial Interest Rate.
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TREASURY RATE
Unless otherwise specified in such Note and described in the applicable
Pricing Supplement, "Treasury Rate" means, with respect to any Interest
Determination Date relating to a Treasury Rate Note (a "Treasury Rate Interest
Determination Date"), the rate for the most recent auction of direct
obligations of the United States ("Treasury Bills") having the Index Maturity
described in the applicable Pricing Supplement, as such rate is published in
H.15(519) under the heading, "U.S. Government Securities--Treasury Bills--
auction average (investment)," or if not so published by 3:00 p.m., New York
City time, on the Calculation Date relating to such Treasury Rate Interest
Determination Date, the Treasury Rate will be the auction average rate
(expressed as a bond equivalent, rounded, if necessary, to the nearest one
hundred-thousandth of a percentage point, on the basis of a year of 365 or 366
days, as applicable, and applied on a daily basis) as otherwise announced by
the United States Department of the Treasury. In the event that the results of
the auction of Treasury Bills having the Index Maturity described in the
applicable Pricing Supplement are not published or announced as described
above by 3:00 p.m., New York City time, on such Calculation Date, or if no
such auction is held in a particular week, then the Treasury Rate for such
Treasury Rate Interest Determination Date will be calculated by the
Calculation Agent and will be a yield to maturity (expressed as a bond
equivalent, rounded, if necessary, to the nearest one hundred-thousandth of a
percentage point, on the basis of a year of 365 or 366 days, as applicable,
and applied on a daily basis) of the arithmetic mean (rounded, if necessary,
to the nearest one hundred-thousandth of a percentage point) of the secondary
market bid rates, as of approximately 3:30 p.m., New York City time, on such
Treasury Rate Interest Determination Date, of three leading primary United
States government securities dealers (which, unless otherwise described in the
applicable Pricing Supplement, may include an affiliate of the Calculation
Agent or an Agent) selected by the Calculation Agent (after consultation with
the Company), for the issue of Treasury Bills will a remaining maturity
closest to the Index Maturity described in the applicable Pricing Supplement;
provided, however, that if the dealers selected as aforesaid by the
Calculation Agent are not quoting as mentioned in this sentence, the Treasury
Rate will be the Treasury Rate determined with respect to the immediately
preceding Treasury Rate Interest Determination Date or, in the case of the
first Treasury Rate Interest Determination Date, the Initial Interest Rate.
ZERO COUPON NOTES
Each Zero Coupon Note will be offered at a substantial discount from its
principal amount at maturity. There will be no periodic payments of interest
with respect to a Zero Coupon Note. The calculation of the accrual of Original
Issue Discount (the difference between the Issue Price and the principal
amount at maturity of a Zero Coupon Note) in the period during which a Zero
Coupon Note remains outstanding will be on a semiannual bond equivalent basis
using a 360-day year composed of twelve 30-day months. Upon maturity, Original
Issue Discount will cease to accrue on a Zero Coupon Note. Each Zero Coupon
Note will set forth, among other things, the Original Issue Date, the Issue
Price, the yield to maturity, and the amount of Original Issue Discount
applicable to such Note. If a bankruptcy proceeding is commenced in respect of
the Company, the claim of the holder of a Zero Coupon Note is, under Title 11
of the United States Code, limited to the Amortized Face Amount of such Zero
Coupon Note calculated as of the date of commencement of the proceeding.
EXTENSION OF MATURITY
Each Note will specify and the Pricing Supplement relating to each Note will
describe whether the Company has the option to extend the Stated Maturity Date
of such Note for one or more whole year periods (each an "Extension Period")
up to but not beyond the date (the "Final Maturity Date") specified in such
Note and described in such Pricing Supplement and the basis or formula, if
any, for setting the interest rate or the Spread and/or Spread Multiplier, if
any, as the case may be, applicable to any such Extension Period.
The Company may exercise such option with respect to a Note by notifying the
Trustee of such exercise at least 45 but not more than 60 days prior to the
Stated Maturity Date of such Note in effect prior to the exercise of such
option (the "Original Stated Maturity Date"). No later than 40 days prior to
the Original Stated Maturity Date, the Trustee will mail to the holder of such
Note a notice (the "Extension Notice") relating to such
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Extension Period, by first class mail, postage prepaid, setting forth (i) the
election of the Company to extend the Stated Maturity Date of such Note, (ii)
the new Stated Maturity Date, (iii) in the case of a Fixed Rate Note, the
interest rate applicable to the Extension period or, in the case of a Floating
Rate Note, the Spread and/or Spread Multiplier, if any, applicable to the
Extension Period, and (iv) the provisions, if any, for redemption at the
option of the Company during the Extension Period, including the date or dates
on which or the period or periods during which and the price or prices at
which such redemption may occur during the Extension Period. Upon the mailing
by the Trustee of an Extension Notice to the holder of a Note, the Stated
Maturity Date of such Note shall be extended automatically as set forth in the
Extension Notice, and except as modified by the Extension Notice and as
described in the next paragraph, such Note will have the same terms as prior
to the mailing of such Extension Notice.
Notwithstanding the foregoing, not later than 20 days prior to the Original
Stated Maturity Date for a Note, the Company may, at its option, revoke the
interest rate, in the case of a Fixed Rate Note, or the Spread and/or Spread
Multiplier, in the case of a Floating Rate Note, provided for in the Extension
Notice and establish a higher interest rate, in the case of a Fixed Rate Note,
or a higher Spread and/or Spread Multiplier in the case of a Floating Rate
Note, for the Extension Period by mailing or causing the Trustee to mail
notice of such higher interest rate or higher Spread and/or Spread Multiplier,
as the case may be, first class mail, postage prepaid, to the holder of such
Note. Such notice shall be irrevocable. All Notes with identical terms with
respect to which the Stated Maturity Date is extended will bear such higher
interest rate, in the case of a Fixed Rate Note, or higher Spread and/or
Spread Multiplier, as the case may be, in the case of a Floating Rate Note,
for the Extension Period.
If the Company elects to extend the Stated Maturity Date of a Note, the
holder of such Note may, if specified in such Note and described in the
applicable Pricing Supplement, have the option to elect repayment of such Note
by the Company on the Original Stated Maturity Date at a price equal to the
principal amount thereof plus any accrued and unpaid interest to such date or,
if such Note is an Original Issue Discount Note, the Amortized Face Amount of
such Note calculated as of such date. In order for a Note to be so repaid on
the Original Stated Maturity Date, the holder thereof must follow the
procedures for optional repayment set forth above under "Repayment and
Redemption", except that the period for delivery of such Note to the Trustee
shall be at least 25 but not more than 35 days prior to the Original Stated
Maturity Date and except that a holder who has tendered a Note for repayment
pursuant to an Extension Notice may, by written notice to the Trustee, revoke
any such tender for repayment until the close of business on the tenth day
prior to the Original Stated Maturity Date.
MULTI-CURRENCY NOTES AND INDEXED NOTES
If any Note is not to be denominated in U.S. Dollars, certain provisions
with respect thereto will be set forth in a Multi-Currency Prospectus
Supplement and an applicable Pricing Supplement which will specify the
currency or currencies, including composite currencies such as the European
Currency Unit, in which the principal, premium, if any, and interest, if any,
with respect to such Note are to be paid (the "Specified Currency"), along
with any other terms relating to the non-U.S. Dollar denomination.
The Notes also may be issued with the principal amount payable at maturity
to be determined with reference to the exchange rate of a Specified Currency
relative to an indexed currency (the "Indexed Currency") or other index, each
as set forth in the Multi-Currency Prospectus Supplement and an applicable
Pricing Supplement. Holders of such Notes may receive a principal amount at
maturity that is greater than or less than the face amount of the Note
depending upon the relative value at maturity of the Specified Currency
compared to the Indexed Currency or other index. Information as to the method
for determining the principal amount payable at maturity, the relative value
of the Specified Currency compared to the applicable Indexed Currency or other
index and certain additional risks and tax considerations associated with
investment in such Notes will be set forth in the applicable Multi-Currency
Prospectus Supplement.
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BOOK-ENTRY SYSTEM
The Notes may be issued in whole or in part as Book-Entry Notes represented
by a Global Security (as defined in the accompanying Prospectus) deposited
with, or on behalf of, the Depository and registered in the name of the
Depository or a nominee of the Depository. Unless otherwise specified in the
applicable Pricing Supplement, DTC will be the Depository.
So long as the Depository for a Global Security, or a nominee of the
Depository, is the registered owner of the Global Security, the Depository or
its nominee, as the case may be, will be considered the sole owner or holder
of the Book-Entry Notes represented by such Global Security for all purposes
under the Indenture. Except as provided below, owners of beneficial interests
in Book-Entry Notes represented by a Global Security will not be considered
the owners or holders thereof under the Indenture, will not be entitled to
have Book-Entry Notes represented by such Global Security registered in their
names and will not be entitled to physical delivery of Notes in certificated
form evidencing their respective beneficial interests therein. A Global
Security may not be transferred except as a whole by the Depository to a
nominee of the Depository or by a nominee of the Depository to the Depository
or another nominee of the Depository or by the Depository or any nominee to a
successor of the Depository of a nominee of such successor.
Payments of principal of and any premium and interest on Book-Entry Notes
represented by a Global Security registered in the name of a Depository or its
nominee will be made to the Depository or its nominee, as the case may be, as
the registered owner of the Global Security. Neither the Company, the Trustee,
any Paying Agent nor the Registrar will have any responsibility or liability
for any aspect of the records relating to or payments made on account of
beneficial ownership interests in Book-Entry Notes represented by a Global
Security or for maintaining, supervision or reviewing any records relating to
such beneficial ownership interests.
The Company expects that the Depository or its nominee, upon receipt of any
payment of principal, premium, if any, or interest, if any, in respect of a
Global Security, will credit immediately participants' accounts with payments
in amounts proportionate to their respective beneficial interests in the
principal amount of such Global Security as shown on the records of such
Depository or its nominee. The Company also expects that payments by
participants to owners of beneficial interests in Book-Entry Notes represented
by such Global Security held through such participants will be governed by
standing customer instructions and customary practices, as is now the case
with securities held for the accounts of customers in bearer form or
registered in "street name", and will be the responsibility of such
participants.
If the Depository with respect to any Global Security is at any time
unwilling, unable or ineligible to continue as depositary and a successor
depositary is not appointed by the Company within 90 days of such time, the
Company will issue Certificated Notes in exchange for each Book-Entry Note
represented by such Global Security. In addition, the Company may at any time
and in its sole discretion determine not to have the Notes represented by a
Global Security and, in such event, will issue Certificated Notes in exchange
for the Book-Entry Notes represented by such Global Security. In either
instance, an owner of a beneficial interest in a Book-Entry Note will be
entitled to have a Certificated Note or Notes equal in principal amount to
such beneficial interest registered in its name and will be entitled to
physical delivery of such Note or Notes.
DTC has advised the Company and the Agents as follows: DTC is a limited-
purpose trust company organized under the laws of the State of New York, a
member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Securities
Exchange Act of 1934. DTC was created to hold securities for persons that have
accounts with DTC ("participants") and to facilitate the clearance and
settlement of securities transactions among its participants in such
securities through electronic book-entry changes in accounts of the
participants, thereby eliminating the need for physical movements of
securities certificates. DTC's participants include securities brokers and
dealers (including the Agents), banks, trust companies, clearing corporations,
and certain other organizations, some of whom (and/or their representatives)
own DTC. Access to DTC's book-entry system is also available to others, such
as banks, brokers, dealers and
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trust companies that clear through or maintain a custodial relationship with a
participant, either directly or indirectly. Persons who are not participants
may beneficially own securities held by DTC only through participants.
DTC has also advised the Company and the Agents that, upon the issuance by
the Company of Book-Entry Notes represented by a Global Security, DTC will
credit on its book-entry registration and transfer system the respective
principal amounts of the Book-Entry Notes represented by such Global Security
to the accounts of participants. The accounts to be credited shall be
designated by the applicable Agent or by the Company if such Notes are offered
and sold directly by the Company. Ownership of beneficial interests in Book-
Entry Notes represented by a Global Security registered in the name of DTC or
its nominee will be limited to participants or persons that may hold interests
through participants. Ownership of beneficial interests in Book-Entry Notes
represented by a Global Security registered in the name of DTC or its nominee
will be shown on, and the transfer of that ownership will be effected only
through, records maintained by DTC or its nominee (with respect to beneficial
interests of participants), or by participants or persons that may hold
interests through participants (with respect to beneficial interests of
persons other than participants). The laws of some states may require that
certain purchasers of securities take physical delivery of such securities in
certificated form. Such limits and such laws may impair the ability to
transfer beneficial interests in Book-Entry Notes.
CERTAIN UNITED STATES TAX CONSIDERATIONS
UNITED STATES HOLDERS
The following is a summary of certain United States federal income tax
considerations that may be relevant to a holder of a Note that is a United
States person (as defined in the Code), or that otherwise is subject to United
States federal income taxation on a net income basis in respect of a Note.
This summary is based on laws, regulations, rulings and decisions now in
effect, all of which are subject to change. This summary deals only with
holders that will hold Notes as capital assets and does not address tax
considerations applicable to investors that may be subject to special tax
rules, such as financial institutions, tax-exempt organizations, insurance
companies or dealers in securities or currencies, or persons that will hold
Notes as a position in a "straddle" or as part of a hedging transaction for
tax purposes. This summary does not include a discussion of tax consequences
to holders of any Note in which principal, premium, if any, and interest, if
any, with respect to such Note are to be paid in a Specified Currency or which
is an Indexed Currency Note. Additional United States federal income tax
considerations applicable to particular Notes may be set forth in the
applicable Multi-Currency Prospectus Supplement or Pricing Supplement.
Investors should consult their own tax advisors in determining the tax
consequences to them of holding and disposing of Notes, including the
application to their particular situation of the tax considerations discussed
below, as well as the application of state, local, foreign or other tax laws.
Payments of Interest. Payments of Qualified Stated Interest (as defined
below) on a Note will be taxable to a holder as ordinary interest income at
the time that such payments are accrued or are received (in accordance with
the holder's method of tax accounting). In general, Qualified Stated Interest
is stated interest which is unconditionally payable in cash or property (other
than debt instruments of the issuer) at least annually at a single fixed rate.
(For a special rule in the case of Floating Rate Notes, see below.)
Purchase, Sale and Retirement of Notes. A holder's tax-basis in a Note
generally will equal the cost of such Note to such holder, increased by any
amounts includible in income by the holder as original issue discount (and
accrued market discount, if any, if the holder has included such market
discount in income) and reduced by any amortized premium (each as described
below) and any payments other than payments of Qualified Stated Interest made
on such Note.
Upon the sale, exchange or retirement of a Note, a holder generally will
recognize gain or loss in an amount equal to the difference between the amount
realized on the sale, exchange or retirement (less any accrued and unpaid
interest, which will be taxable as such) and the holder's tax basis in the
Note.
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Except as otherwise discussed below, gain or loss recognized by a holder on
the sale, exchange or retirement of a Note generally will be long-term capital
gain or loss if the holder has held the Note for more than one year at the
time of disposition. Currently, for individuals, long-term capital gain is
subject to a maximum rate of taxation of 28%, as opposed to a maximum rate of
39.6% for ordinary income. The distinction between capital gain or loss and
ordinary income or loss is also important for purposes of the limitations on a
holder's ability to offset capital losses against ordinary income.
Original Issue Discount. Holders of Original Issue Discount Notes generally
will be subject to the special tax accounting rules for original issue
discount obligations provided by the Code and certain Treasury Regulations
issued on January 27, 1994 (the "OID Regulations"). Holders of such Notes
should be aware that, as described in greater detail below, they generally
must include original issue discount in ordinary gross income for United
States federal income tax purposes as it accrues, in advance of the receipt of
cash attributable to that income.
For United States Federal income tax purposes, original issue discount is
the excess of the stated redemption price at maturity of a Note over its issue
price, if such excess equals or exceeds a de minimus amount (generally 1/4 of
1% of the Note's stated redemption price at maturity multiplied by the number
of complete years to its maturity from its issue date). The issue price of an
issue of Notes equals the first price at which a substantial amount of such
Notes has been sold. The stated redemption price at maturity of a Note is the
sum of all payments provided by the Note other than payments of Qualified
Stated Interest. In addition, under the OID Regulations, if a Note bears
interest for one or more accrual periods at a rate below the rate applicable
for the remaining term of such Note (e.g., Notes with teaser rates or interest
holidays), and if the greater of either the resulting foregone interest on
such Note or any "true" discount on such Note (i.e., the excess of the Note's
stated principal amount over its issue price) equals or exceeds a specified de
minimis amount, then part or all of the stated interest on the Note would be
treated entirely as original issue discount rather than Qualified Stated
Interest.
In general, each holder of an Original Issue Discount Note, whether such
holder uses the cash or the accrual method of tax accounting, will be required
to include in ordinary gross income the sum of the "daily portions" of
original issue discount on that Note for all days during the taxable year on
which the holder owns the Note. The daily portions of original issue discount
on an Original Issue Discount Note are determined by allocating to each day in
any accrual period a ratable portion of the original issue discount allocable
to that accrual period. An accrual period may be any length of time, and the
lengths may vary during the time the Note is outstanding, so long as no
accrual period is greater than one year and provided that each scheduled
payment of principal or interest occurs either on the final day of an accrual
period or on the first day of an accrual period. In the case of an initial
holder, the amount of original issue discount on an Original Issue Discount
Note allocable to each accrual period is determined by (i) multiplying the
"adjusted issue price" (as defined below) of the Note by the yield to maturity
of the Note (as adjusted for the length of the accrual period) and (ii)
subtracting from that product the amount, if any, of Qualified Stated Interest
allocable to that accrual period.
The "adjusted issue price" of an Original Issue Discount Note at the
beginning of any accrual period will generally be the sum of its issue price
and the amount of original issue discount allocable to all prior accrual
periods, reduced by the amount of all payments other than payments of
Qualified Stated Interest, if any, made with respect to such Note in all prior
accrual periods. As discussed above, in order to determine the amount of
original issue discount allocable to an accrual period, the adjusted issue
price of an Original Issue Discount Note will be multiplied by the Note's
yield to maturity (as adjusted for the length of the accrual period). As a
result of this "constant yield" method of including original issue discount
into income, the amounts so includible in income by a holder, in respect of an
Original Issue Discount Note, are generally lesser in the early years and
greater in the later years than the amounts that would be includible on a
straight-line basis.
In the case of Floating Rate Notes, special rules apply. Such a Note will
qualify as a "variable rate debt instrument" if it (i) has an issue price
which does not exceed the total noncontingent principal payments by more than
an amount equal to the lesser of (a) .015 multiplied by the product of the
total noncontingent principal payments and the number of complete years to the
Floating Rate Note's maturity from its issue date or (b) 15 percent of the
total noncontingent principal payments; (ii) provides for stated interest,
paid or compounded at
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least annually, at current values of (a) one or more qualified floating rates,
(b) a single fixed rate and one or more qualified floating rates, (c) a single
fixed rate and a single objective rate that is a qualified inverse floating
rate or (d) a single objective rate. A floating rate is a qualified floating
rate if variations in the rate can reasonably be expected to measure
contemporaneous variations in the cost of newly borrowed funds in the currency
in which the Floating Rate Note is denominated. A multiple of a qualified
floating rate is generally not a qualified floating rate, except that a
multiple greater than zero and not more than 1.35 is permissible (and the
product can be decreased or increased by a fixed rate). An objective rate is a
rate (other than a qualified floating rate) which is determined using a single
fixed formula and which is based upon (i) either the yield or changes in the
price of one or more items of personal property that is actively traded (other
than stock or debt of the issuer or a related party); (ii) one or more
qualified floating rates; (iii) one or more rates where each rate would be a
qualified floating rate for a debt instrument denominated in a currency other
than the currency in which Floating Rate Note is denominated, or (iv) a
combination of the above rates. A qualified inverse floating rate is an
objective rate in which (i) the rate is equal to a fixed rate minus a
qualified floating rate and (ii) variations in the rate can reasonably be
expected to inversely reflect contemporaneous variations in the cost of newly
borrowed funds. The fact that a Floating Rate Note has a Maximum Interest Rate
or a Minimum Interest Rate will not affect the qualification of the Floating
Rate Note as a "variable rate debt instrument" if such Maximum or Minimum
Interest Rates are fixed throughout the term of the debt instruments, or such
Maximum or Minimum Interest Rates are not reasonably expected as of the issue
date to cause the yield on the Note to be significantly more or less than the
yield would be without the restriction of the Maximum or Minimum Interest
Rate. The OID Regulations also provide that if a Floating Rate Note provides
for stated interest at a fixed rate for an initial period of less than one
year followed by a variable rate that is either a qualified floating rate or
an objective rate and if the variable rate on the Floating Rate Note's issue
date is intended to approximate the fixed rate (e.g., the value of the
variable rate on the issue date does not differ from the value of the fixed
rate by more than 25 basis points), then the fixed rate and the variable rate
together will constitute either a single qualified floating rate or objective
rate, as the case may be.
If a Floating Rate Note that provides for stated interest at either a single
qualified floating rate or a single objective rate throughout the term thereof
qualifies as a "variable rate debt instrument" under the OID Regulations, then
any stated interest on such Note which is unconditionally payable in cash or
property (other than debt instruments of the issuer) at least annually will
constitute Qualified Stated Interest and will be taxed accordingly. Thus, a
Floating Rate Note that provides for stated interest at either a single
qualified floating rate or a single objective rate throughout the term thereof
and that qualifies as a "variable rate debt instrument" under the OID
Regulations will generally not be treated as having been issued with original
issue discount unless the Floating Rate Note is issued at a "true" discount
(i.e., at a price below the Note's stated principal amount) in excess of a
specified de minimis amount. Original issue discount on such a Floating Rate
Note arising from "true" discount is allocated to an accrual period using the
constant yield method described above.
In general, any other Floating Rate Note that qualifies as a "variable rate
debt instrument" will be deemed to be converted into an "equivalent" fixed
rate debt instrument for purposes of determining the amount and accrual of
original issue discount and Qualified Stated Interest on the Floating Rate
Note. The OID Regulations generally require that such a Floating Rate Note be
treated as converted into an "equivalent" fixed rate debt instrument by
substituting any qualified floating rate or qualified inverse floating rate
provided for under the terms of the Floating Rate Note with a fixed rate equal
to the value of the qualified floating rate or qualified inverse floating
rate, as the case may be, as of the Floating Rate Note's issue date. Any
objective rate (other than a qualified inverse floating rate) provided for
under the terms of the Floating Rate Note is converted into a fixed rate that
reflects the yield that is reasonably expected for the Floating Rate Note. In
the case of a Floating Rate Note that qualifies as a "variable rate debt
instrument" and provides for stated interest at a fixed rate in addition to
either one or more qualified floating rates or a qualified inverse floating
rate, the fixed rate is initially converted into a qualified floating rate (or
a qualified inverse floating rate, if the Floating Rate Note provides for a
qualified inverse floating rate). Under such circumstances, the qualified
floating rate or qualified inverse floating rate that replaces the fixed rate
must be such that the fair market value of the Floating Rate Note as of the
Floating Rate Note's issue date is approximately the same as the fair market
value of an otherwise identical debt instrument
S-19
<PAGE>
that provides for either the qualified floating rate or qualified inverse
floating rate rather than the fixed rate. Subsequent to converting the fixed
rate into either a qualified floating rate or a qualified inverse floating
rate, the Floating Rate Note is then treated as converted into an "equivalent"
fixed rate debt instrument in the manner described above.
Once the Floating Rate Note is deemed converted into an "equivalent" fixed
rate debt instrument pursuant to the foregoing rules, the amount of original
issue discount and qualified stated interest, if any, are determined for the
"equivalent" fixed rate debt instrument by applying the general original issue
discount rules to the "equivalent" fixed rate debt instrument and a United
States holder of the Floating Rate Note will account for such original issue
discount and qualified stated interest as if the United States holder held the
"equivalent" fixed rate debt instrument. Each accrual period appropriate
adjustments will be made to the amount of qualified stated interest or
original issue discount assumed to have been accrued or paid with respect to
the "equivalent" fixed rate debt instrument in the event that such amounts
differ from the actual amount of interest accrued or paid on the Floating Rate
Note during the accrual period.
If a Floating Rate Note does not qualify for the above treatment, then the
Note will be an Original Issue Discount Note and the interest on such Note
will be treated as contingent interest. Contingent interest is generally
includible in income as it becomes fixed, to the extent that such interest
exceeds any minimum stated interest. The regulations governing contingent
interest are still in proposed form, so that details of the law governing
contingent interest are still uncertain.
A subsequent holder of an Original Issue Discount Note that does not
purchase the Note at a cost which exceeds its stated redemption price at
maturity, reduced by the amount of any payment made on the Note prior to the
date of purchase other than payments of Qualified Stated Interest, also
generally will be required to include in gross income the daily portions of
original issue discount, calculated as described above. However, if the
subsequent holder acquires the Original Issue Discount Note at a lower yield
to maturity than the yield of the Note for original issue discount purposes
with respect to the initial holder of the Note, the subsequent holder may
reduce its periodic inclusions of original issue discount income to reflect
the lower yield to maturity of the Note.
In general, an individual or other cash method holder of an Original Issue
Discount Note that matures one year or less from the date of its issuance (a
"short-term Original Issue Discount Note") is not required to accrue original
issue discount for United States federal income tax purposes unless an
election is made to do so. United States holders who report income for federal
income tax purposes on the accrual method and certain other holders, including
banks and dealers in securities, are required to include original issue
discount on such short-term Original Issue Discount Notes on a straight-line
basis, unless an election is made to accrue the original issue discount
according to a constant interest method based on daily compounding. In the
case of a holder who is not required, and does not elect, to include original
issue discount in income currently, any gain realized on the sale, exchange or
retirement of the short-term Original Issue Discount Note will be ordinary
income to the extent of the original issue discount accrued on a straight-line
basis (or, if elected, according to a constant interest method based on daily
compounding) through the date of sale, exchange or retirement. In addition,
such non-electing holders which are not subject to the current inclusion
requirement described in this paragraph will be required to defer deductions
for any interest paid on indebtedness incurred or continued to purchase or
carry such short-term Original Issue Discount Notes in an amount not exceeding
the deferred interest income, until such deferred interest income is realized.
If any Note is issued with Optional Repayment Dates, the yield and maturity
on the Note will be calculated by assuming that the Note will be repaid on the
first Optional Repayment Date is such repayment would increase the yield on
the Note. If the Note is deemed to be repaid on the first Optional Repayment
Date, but it not in fact repaid on such date, then for purposes of calculating
original issue discount, a new Note will be deemed issued on such date for the
Note's adjusted issue price on such date, and the rules outlined in this and
the previous sentence will apply with respect to al subsequent Optional
Repayment Dates.
S-20
<PAGE>
If any Note is issued with Redemption Dates, the yield and maturity on such
Note will be calculated by assuming that the Note will be redeemed on the
Initial Redemption Date if such redemption would decrease the yield on the
Note. If the Note is deemed to be redeemed on the Initial Redemption Date, but
is not in fact redeemed on such date, then for purposes of calculating
original issue discount, a new Note will be deemed issued on such date for the
Note's adjusted issue price on such date, and the rules outlined in this and
the previous sentence will apply with respect to all subsequent Redemption
Dates.
If any Note is subject to an Extension Period, then the yield and maturity
on such Note shall be calculated by deeming the Final Maturity Date to be the
Stated Maturity Date of the Note and treating the Original Stated Maturity
Date as being the date on which the Company has a call option on the Note.
Such call option will be deemed to be exercised on the Original Stated
Maturity Date if, and only if, by utilizing the Original Stated Maturity Date
as the Maturity Date and the redemption price on such date as the stated
redemption price at maturity, the yield to maturity of the Note is lower than
it would be if the Note were not redeemed on such date. If the Note is deemed
to be repaid on the Original Stated Maturity Date and is not in fact repaid on
such date, then for purposes of calculating original issue discount a new Note
will be deemed issued on the Original Stated Maturity Date for the Note's
adjusted issue price on such date and the rules outlined in this and the
previous sentence will apply with respect to all subsequent maturity dates. If
the deemed call option is not considered to be exercised, the option to extend
shall be presumed to be exercised.
Premium and Market Discount. A holder of a Note that purchases the Note at a
cost greater than the sum of all amounts payable on the Note after the
purchase (other than payments of Qualified Stated Interest) will be considered
to have purchased the Note at a premium and may amortize such premium, using a
constant yield method, over the remaining term of the Note.
If a holder of a Note purchases the Note at a price that produces a yield to
maturity higher than the yield to maturity at which such Note first was
issued, the Note generally will be considered to bear "market discount" in the
hands of such holder. In such case, the gain realized by the holder on the
sale or retirement of the Note generally will be treated as ordinary income to
the extent of the market discount that accrued on the Note while held by such
holder, unless such holder elected to accrue market discount into income
currently. In general terms, market discount on a Note will be treated as
accruing ratably over the term of such Note, or, at the election of the
holder, under a constant yield method. In addition, a portion of the interest
expense incurred or continued to purchase or carry a Note with market discount
may be deferred unless the holder elects to accrue market discount into income
currently.
The OID Regulations provide for an election whereby a holder on the accrual
basis of accounting may choose to treat all stated interest, original issue
discount, and market discount as original issue discount.
Treatment of Certain Interest. The treatment to a holder of income from an
Original Issue Discount Note may be affected by a provision of the Omnibus
Budget Reconciliation Act of 1989. To the extent this provision applies to an
Original Issue Discount Note and the holder of such Note is a corporation,
then solely for purposes of the deduction allowed by the Code to corporations
for dividends received from a domestic corporation, all or a portion of the
original issue discount from such Note may be treated as a dividend to such
holder. For this provision to apply (i) the maturity date of a debt instrument
must be more than 5 years from the date of issue, (ii) the yield to maturity
on such instrument must equal or exceed the sum of (A) the applicable federal
rate in effect under Section 1274(d) of the Code for the calendar month in
which the obligation is issued, plus (B) 5 percentage points, and (iii) such
instrument must have "significant original issue discount." A debt instrument
will be treated as having "significant original issue discount" if (i) the
aggregate amount which would be includible in gross income with respect to
such instrument for periods before the close of any accrual period ending
after the date five years after the date of issue, exceeds (ii) the sum of (A)
the aggregate amount of interest to be paid under the instrument before the
close of such accrual period, and (B) the product of the issue price of such
instrument and its yield to maturity. For purposes of applying this provision
to a debt instrument, any payment under the instrument will be assumed to be
made on the last day permitted under such instrument. The specific application
of this provision to an Original Issue Discount Note will depend upon the
terms of such Note.
S-21
<PAGE>
NON-UNITED STATES HOLDERS
Under present United States federal income and estate tax law, and subject
to the discussion of backup withholding below:
(i) payments of principal and interest, including premium or original
issue discount ("Discount") on an Original Issue Discount Note, made by the
Company or any of its paying agents on a Note to any holder that is a
corporation, individual, fiduciary or partnership that is, as to the United
States, a foreign corporation, a nonresident alien individual, a
nonresident fiduciary of a foreign estate or trust, or a foreign
partnership one or more of the members of which is, as to the United
States, a foreign corporation, a nonresident alien individual or a
nonresident fiduciary of a foreign estate or trust (a "United States
Alien") will not be subject to United States withholding tax, provided that
in the case of Discount or interest, (a) the holder does not actually or
constructively own 10% or more of the total combined voting power of all
classes of stock of the Company entitled to vote, (b) the holder is not a
controlled foreign corporation that is related to the Company through stock
ownership, (c) the holder is not a bank receiving interest described in
Section 881(c)(3) of the Code, and (d) either (1) the beneficial owner of
the Note certifies to the Company or its agent, under penalties of perjury,
that it is not a United States person (as defined in the Code) and provides
its name and address or (2) a securities clearing organization, bank or
other financial institution that holds customers' securities in the
ordinary course of its trade or business (a "financial institution"), and
holds the Note on behalf of the beneficial owner, certifies to the Company
or its agent, under penalties of perjury, that such a certification from
the beneficial owner has been received by it or by a financial institution
between it and the beneficial owner and furnishes the payor with a copy
thereof.
(ii) a holder of a Note who is a United States Alien will not be subject
to United States federal income tax on gain realized on the sale, exchange
or retirement of the Note, unless (a) such gain is derived within the
United States and such holder is an individual who is present in the United
States for 183 days or more during the taxable year in which the gain
occurred or (b) such gain is effectively connected with a United States
trade or business of such holder; and
(iii) a Note held by an individual who at the time of death is not a
citizen or resident of the United States (as defined in the Code) will not
be subject to United States federal estate tax as a result of such
individual's death if the individual does not actually or constructively
own 10% or more of the total combined voting power of all classes of stock
of the Company entitled to vote and, at the time of the individual's death,
payments with respect to the Note would not have been effectively connected
to the conduct of a trade or business by the individual in the United
States.
If a United States Alien is engaged in a trade or business in the United
States and interest, including Discount, on the Note is effectively connected
with the conduct of such trade or business, the United States Alien, although
exempt from the withholding tax discussed in the preceding paragraph, may be
subject to United States income tax on such interest and Discount in the same
manner as if it were a United States holder. In addition, if such a holder is
a foreign corporation, it may be subject to a branch profits tax equal to 30%
of its effectively connected earnings and profits for the taxable year,
subject to adjustments. For this purpose, interest, including Discount, on a
Note will be included in earnings and profits if such interest and Discount is
effectively connected with the conduct by the United States Alien of a trade
or business in the United States.
Notwithstanding the above, certain contingent interest will be taxable to
non-resident alien individuals and foreign corporations unless such interest
is subject to a treaty exemption. For this purpose, subject to certain
exceptions, interest is deemed to be contingent if the amount of interest is
determined by reference to:
1. any receipts, sales or other cash flow of the Issuer or a related
person;
2. any income or profits of the Issuer or a related person;
3. any change in value of any property of the Issuer or a related person;
or
4. any dividend, partnership distribution or similar payments made by the
Issuer or a related person.
S-22
<PAGE>
A "related person" for this purpose includes not only persons who would be
related under the rules of Section 267(b) and Section 707(b)(1) of the Code,
but also anyone who is a party to any arrangement undertaken for a tax
avoidance purpose. In addition, the Internal Revenue Service (the "IRS") may
designate in regulations other types of contingent interest which will fall
under the scope of this law.
Also, a Note providing only for contingent interest will be considered
situated within the United States for estate tax purposes, and will thus be
included in a decedent's gross estate. If a Note provides for both contingent
and non-contingent interest, an appropriate portion of the value of such an
instrument, as determined in a manner prescribed by the IRS, will be treated
as property within the U.S. and will thus be included in a decedent's gross
estate. Until regulations are issued to provide guidance as to the proper
method for determining the appropriate portion of such an instrument that is
to be treated as situated in the United States, taxpayers will be permitted to
use any reasonable method for making such determination.
The exact scope of the law relating to contingent interest Notes remains to
be determined by regulations. Prospective holders of Notes are urged to
consult their personal tax advisors with respect to the scope of the law.
INFORMATION REPORTING AND BACKUP WITHHOLDING
Payments of principal (including Discount, if any) of and any premium and
interest on a Note made within the United States by the Company or the Paying
Agent are generally subject to information reporting and possibly to "backup
withholding" at a rate of 31%. Information reporting and "backup withholding"
generally do not apply to payments to certain "exempt recipients" such as
corporations. Also, information reporting and backup withholding do not apply
to payments of principal (including Discount, if any) of and any premium and
interest on a Note made outside the United States by the Company or the Paying
Agent if the certification described in clause (i) (d) under "Non-United
States Holders" is received, provided in each case that the payor does not
have actual knowledge that the holder is a United States person.
Payment of the proceeds from the sale of a Note to or through a foreign
office of a broker will not be subject to information reporting or backup
withholding, except that, if the broker is a United States person, a
controlled foreign corporation for United States tax purposes or a foreign
person 50% or more of whose gross income is from a United States trade or
business, information reporting and possibly backup withholding will apply to
such payments unless such broker has documentary evidence in its files of the
owner's foreign status and has no actual knowledge to the contrary (or the
owner otherwise establishes an exemption from information reporting and backup
withholding). Payment of the proceeds from the sale of a Note to or through
the United States office of a broker is subject to information reporting and
backup withholding unless the holder or beneficial owner certifies as to its
United States Alien status or otherwise establishes an exemption from
information reporting and backup withholding.
PLAN OF DISTRIBUTION
The Notes are being offered on a continuous basis by the Company through
Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, CS
First Boston Corporation, Lehman Brothers, Lehman Brothers Inc. or Salomon
Brothers Inc (each an "Agent" and together the "Agents"). The Company reserves
the right to sell Notes through agents other than the Agents subject to the
terms of the Distribution Agreement between the Company and the Agents. The
Company will pay the applicable Agent a commission which, depending on the
maturity of the Notes and the rating assigned to the Notes by nationally
recognized statistical rating agencies, will range from .125% to .925% of the
principal amount or, in the case of an Original Issue Discount Note, the Issue
Price of any Note of the Company sold through such Agent. The Company may sell
the Notes to each of the Agents, as principal, at a discount for their own
account or for resale to investors or other purchases at varying prices
related to prevailing market prices at the time of resale, to be determined by
such Agent or, if so agreed, at a fixed public offering price.
S-23
<PAGE>
In addition, the Agents may offer the Notes they have purchased as principal
to other dealers. The Agents may sell Notes to any dealer at a discount and,
unless otherwise specified in an applicable Pricing Supplement, such discount
allowed to any dealer will not be in excess of the discount to be received by
such Agent from the Company. Unless otherwise indicated in an applicable
Pricing Supplement, any Note sold to an Agent as principal will be purchased
by such Agent at a price equal to 100% of the principal amount thereof less a
percentage equal to the commission applicable to any agency sale of a Note of
identical maturity, and may be resold by the Agent to investors and other
purchasers from time to time as described above. After the initial public
offering of Notes to be resold to investors and other purchasers, the public
offering price (in the case of a fixed price public offering), concession and
discount may be changed.
The Company reserves the right to withdraw, cancel or modify the offer made
hereby without notice and, in its sole discretion, may accept or reject orders
in while or in part whether placed directly with Company or through an Agent.
Each Agent will have the right, in its discretion reasonably exercised, to
reject any offer to purchase Notes received by it, in whole or in part.
Payment of the purchase price of the Notes will be required to be made in
immediately available funds in The City of New York, on the date of
settlement.
Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, CS
First Boston Corporation, Lehman Brothers Inc. and Salomon Brothers Inc and
certain affiliates thereof engage in transactions with and perform services
for the Company and certain of its subsidiaries in the ordinary course of
business.
The Company has agreed to indemnify the Agents against, or to contribute to
payments the Agents may be required to make in respect of, certain civil
liabilities, including liabilities under the Securities Act of 1933, as
amended. The Agents may be deemed to be underwriters within the meaning of
such Act. The Company has agreed to reimburse the Agents for certain expenses.
The Agents may engage in transactions with or perform services for the Company
in the ordinary course of business.
The Agents may from time to time purchase and sell Notes in the secondary
market, but they are not obligated to do so, and there can be no assurance
that there will be a secondary market for the Notes of the Company or
liquidity in the secondary market if one develops. From time to time, the
Agents may make a market in the Notes.
The Company has reserved the right to sell Notes directly to investors in
those jurisdictions where it is authorized to do so.
S-24
<PAGE>
PROSPECTUS
TCI COMMUNICATIONS, INC.
DEBT SECURITIES
TCI Communications, Inc. (the "Company") from time to time may offer its
debentures, notes, bonds or other evidences of indebtedness (the "Debt
Securities") for a maximum aggregate initial offering price of $3 billion (or
the equivalent thereof denominated in one or more foreign currencies, foreign
currency units or composite currencies). The Debt Securities may be offered as
separate series in amounts, at prices and on terms to be determined at the
time of sale and to be set forth in supplements to this Prospectus. The Debt
Securities may be offered as convertible Debt Securities which, unless
previously redeemed or otherwise purchased, will be convertible at any time
during the conversion period specified in a supplement to this Prospectus into
shares of Tele-Communications, Inc.'s Series A TCI Group Common Stock, $1.00
par value per share (the "Series A TCI Group Common Stock"). The Debt
Securities may be issued in registered form without coupons attached
("Registered Debt Securities"), in bearer form with or without coupons
attached ("Bearer Debt Securities") and in the form of one or more global
securities ("Global Securities"). See "Description of Debt Securities." Bearer
Debt Securities will be offered only to non-United States persons (subject to
certain exceptions) and to branches, located outside the United States, of
certain United States financial institutions. See "Description of Debt
Securities--Limitations on Issuance of Bearer Debt Securities." The Company
may sell Debt Securities on a negotiated or competitive bid basis to or
through underwriters or dealers designated from time to time, and also may
sell Debt Securities directly to other purchasers or through agents designated
from time to time. See "Plan of Distribution."
Certain terms of the Debt Securities in respect of which this Prospectus is
being delivered, including, where applicable, the specific designation
(including whether senior, senior subordinated or subordinated and whether
convertible), aggregate principal amount, maturity (which may be fixed or
extendible), interest rate or rates (which may be fixed or variable), if any,
and time of payment of interest, if any, authorized denominations, currency or
currencies in which principal, premium, if any, and interest are payable,
initial conversion price or conversion rate and any specific terms relating to
the adjustment thereof that are in addition to or different from those
described herein, the period during which any convertible Debt Securities may
be converted, any terms for a sinking fund or for redemption, purchase or
exchange at the option of the Company or the holder (including the form or
method of payment, which may include cash, Debt Securities of another series
or other forms of consideration), the terms of any guarantee of any
convertible Debt Securities by Tele-Communications, Inc. (the "Parent"), any
covenants or events of default that are in addition to or different from those
described herein, the designation and qualification (to the extent not already
designated and qualified and described herein) of any trustee with respect to
the Debt Securities, and any other specific terms of the Debt Securities, will
be set forth in a Prospectus Supplement accompanying this Prospectus (the
"Prospectus Supplement"). Debt Securities may be issued as Original Issue
Discount Securities to be sold at a substantial discount below their principal
amount and, if issued, certain terms thereof will be set forth in the
Prospectus Supplement related thereto. See "Description of Debt Securities."
The Debt Securities in respect of which this Prospectus is being delivered are
hereinafter referred to collectively as the "Offered Securities." The terms of
the offering and sale of the Offered Securities, including, where applicable,
the name or names of any agents, dealers or underwriters to be utilized in
connection with the offer and sale of the Offered Securities, the principal
amount of Debt Securities to be purchased by underwriters, the purchase price
of the Offered Securities and the proceeds to the Company from such sale, any
applicable commissions, discounts or other items constituting compensation of
such agents or underwriters, any initial public offering price and any
discounts or concessions allowed or reallowed or paid to dealers, will also be
set forth in the accompanying Prospectus Supplement. The Company reserves the
sole right to accept and, together with its agents, from time to time, to
reject in whole or in part any proposed purchase of the Offered Securities to
be made directly or through agents. See "Plan of Distribution" for possible
indemnification arrangements for agents, dealers and underwriters.
This Prospectus may not be used to consummate sales of Debt Securities
unless accompanied by the Prospectus Supplement applicable to the Offered
Securities being sold.
---------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
---------------
The date of this Prospectus is , 1995.
<PAGE>
AVAILABLE INFORMATION
The Company and the Parent have filed with the Securities and Exchange
Commission (the "Commission"), Washington, D.C., a registration statement on
Form S-3 (Registration No. 33- ) (together with all amendments and exhibits,
referred to as the "Registration Statement") under the Securities Act of 1933,
as amended (the "Securities Act"), with respect to the Debt Securities, the
shares of Series A TCI Group Common Stock that may be issuable upon conversion
of any convertible Debt Securities and the guarantees that may be issued by
the Parent in respect of any convertible Debt Securities. This Prospectus does
not contain all of the information set forth in the Registration Statement,
certain parts of which are omitted in accordance with the rules and
regulations of the Commission. For further information pertaining to the
Company, the Parent, the Debt Securities, the Series A TCI Group Common Stock
and the guarantees of the Parent offered hereby, reference is made to the
Registration Statement. Statements contained herein concerning the provisions
of any document are not necessarily complete and, in each instance, reference
is made to the copy of such document filed as an exhibit to the Registration
Statement or otherwise filed with the Commission. Each such statement is
qualified in its entirety by such reference.
Each of the Company and the Parent is subject to the information
requirements of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and in accordance therewith files reports and other information with
the Commission. Reports and other information filed under the Exchange Act by
the Company and/or the Parent can be inspected and copied at the public
reference facilities maintained by the Commission at Judiciary Plaza, Room
1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the following
Regional Offices of the Commission: 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661; and at 7 World Trade Center, Suite 1300, New York,
New York 10048. Copies of such material can be obtained from the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Washington,
D.C. 20549.
INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents have been filed with the Commission by the Company
(File No. 0-5550) and by the Parent (File No. 0-20421) and are incorporated
into this Prospectus by reference and made a part hereof:
1. The Annual Report on Form 10-K of the Parent and the Company for the
year ended December 31, 1994, as amended by Form 10K/A (Amendment No.
1).
2. The Quarterly Reports on Form 10-Q of the Parent and the Company for
the quarters ended March 31, 1995 and June 30, 1995.
3. The Current Reports on Form 8-K of the Parent and the Company dated
January 23, 1995,February 3, 1995 (as amended by Form 8-K/A (Amendment
No. 1), April 6, 1995, April 20, 1995 (as amended by Form 8-K/A
(Amendment No. 1), May 4, 1995 (as amended by Form 8-K/A (Amendment
No. 1), and July 26, 1995.
4. The Current Report on Form 8-K of the Company dated August 1, 1995 and
September 13, 1995.
5. The Current Reports on Form 8-K of the Parent dated February 13, 1995,
February 15, 1995 and August 10, 1995.
6. The financial statements and notes thereto of TeleCable Corporation as
of December 31, 1993 and 1992 and for each of the years in the two-
year period ended December 31, 1993, included in the Current Report on
Form 8-K of the Parent and the Company dated August 26, 1994.
7. The description of the Series A TCI Group Common Stock included in
Items 3 and 4 of the Parent's registration statement on Form 8-B (as
amended by Form 8-B/A (Amendments No. 1, 2 and 3)) and Item 1 of the
Parent's registration statement on Form 8-A (as amended by Form 8-A/A
(Amendment No. 1)).
All documents filed by the Company and/or the Parent with the Commission
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the
date hereof and prior to the termination of the offering of the securities
offered hereby shall be deemed to be incorporated herein by reference and to
be a part hereof from the
2
<PAGE>
respective dates of the filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall
be deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such previous statement. Any such statement so modified
or superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
The Company and the Parent will provide without charge to each person to
whom this Prospectus is delivered, on the written or oral request of any such
person, a copy of any or all of the documents incorporated by reference
herein, other than certain exhibits to such documents. Such requests should be
addressed to Stephen M. Brett, Esq., Senior Vice President, TCI
Communications, Inc., Terrace Tower II, 5619 DTC Parkway, Englewood, Colorado
80111-3000; telephone (303) 267-5500.
3
<PAGE>
THE COMPANY AND THE PARENT
The Company is the largest provider of cable television services in the
United States, based on the number of basic subscribers served by the Company
and its subsidiaries and affiliates at June 30, 1995. At that date, the
Company, through its subsidiaries and affiliates, operated cable television
systems throughout the continental United States and Hawaii. The Company is a
wholly-owned subsidiary of the Parent.
The Parent, through its subsidiaries (including the Company) and affiliates,
is principally engaged in the construction, acquisition, ownership and
operation of cable television systems and in the provision of satellite-
delivered programming services to various distribution media, principally
cable television systems. The Parent is also involved, as an investor and
developer, in new television and telecommunications ventures and technologies.
The executive offices of the Company and the Parent are located at Terrace
Tower II, 5619 DTC Parkway, Englewood, Colorado 80111-3000; telephone (303)
267-5500. Unless the context indicates otherwise and except as used in the
discussion under the caption "Description of Debt Securities," the "Company"
means TCI Communications, Inc. and its consolidated subsidiaries and the
"Parent" means Tele-Communications, Inc. and its consolidated subsidiaries.
USE OF PROCEEDS
The net proceeds from the sale of the Offered Securities, together with
internally generated funds, may be used to repay, redeem or repurchase
outstanding indebtedness of the Company; for general operations of the
Company, including acquisitions, capital expenditures and working capital
requirements; or for such other purposes as may be specified in the Prospectus
Supplement. All or a portion of such proceeds may be advanced to the Parent in
the form of dividends or loans and to other affiliates of the Company in the
form of loans or as a contribution to capital. See "Description of Debt
Securities."
A description of any indebtedness to be repaid with the proceeds of the
Offered Securities will be set forth in the Prospectus Supplement. The amount
of the Company's future capital expenditures for cable television operations
will be determined by acquisitions of additional cable television systems,
contractual obligations under existing franchises, expansions of existing
systems through rebuilds and upgrades, technological developments and various
other economic factors and market conditions. Specific plans, arrangements or
agreements, written or oral, with respect to any material acquisitions by the
Company by merger or otherwise, or with respect to any material disposition of
assets by the Company, if any, will, to the extent not disclosed in a document
incorporated by reference herein, be disclosed in the Prospectus Supplement.
Pending application of the net proceeds to the foregoing uses, the net
proceeds will be added to the Company's working capital and invested in short-
term interest-bearing obligations. Such investments will be subject to
fluctuating interest rates which may be lower than the rates applicable to the
Debt Securities.
The Company may borrow additional funds from time to time from public and
private sources on both a long-term and short-term basis any may sell
commercial paper to fund its future capital and working capital requirements
in excess of internally generated funds. Certain of such borrowings may rank
senior in right of payment to the indebtedness represented by the Debt
Securities. See "Description of Debt Securities."
RATIO OF EARNINGS TO FIXED CHARGES
The ratio of earnings to fixed charges of the Company was 1.02, 1.22, and
1.22 for the years ended December 31, 1992, 1993 and 1994, respectively, and
1.18 for the six months ended June 30, 1994. The ratio of earnings to fixed
charges of the Company was less than 1.00 for the years ended December 31,
1990 and 1991, and for the six months ended June 30, 1995; thus, earnings
available for fixed charges were inadequate to cover fixed charges for such
periods. The amounts of the coverage deficiencies were $399 million and $177
million for
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the years ended December 31, 1990 and 1991, respectively, and $22 million for
the six months ended June 30, 1995. For the ratio calculations, earnings
available for fixed charges consists of earnings (losses) before income taxes
plus fixed charges (minus capitalized interest), distributions from and
(earnings) losses of less than50%-owned affiliates with debt not guaranteed by
the Company (net of earnings not distributed of less than50%-owned
affiliates), and minority interest in earnings (losses) of consolidated
subsidiaries (including an amount representing the pretax earnings which would
be required to cover preferred stock dividend requirements of consolidated
subsidiaries). Fixed charges consist of (i) interest (including capitalized
interest) on debt, excluding interest to 50%-owned affiliates, (ii) the
Company's proportionate share of interest of 50%-owned affiliates, (iii) that
portion of rental expense the Company believes to be representative of
interest (one-third of rental expense), (iv) amortization of debt expense, (v)
that portion of minority interests in earnings of consolidated subsidiaries
that represents the amount of pretax earnings that would be required to cover
preferred stock dividend requirements excluding similarly adjusted preferred
stock dividend requirements of consolidated subsidiaries to 50%-owned
affiliates, and (vi) the amount representing the pretax earnings which would
be required to cover preferred stock dividend requirements of 50%-owned
affiliates, other than amounts payable to the Company. The Company has
guaranteed the debt of certain less than 50%-owned affiliates and certain
other entities in which it has an interest. Fixed charges of $710,000,
$506,000, $2,517,000, $13,833,000 and $12,471,000 relating to such guarantees
for the years ended December 31, 1990, 1991, 1992, 1993 and 1994,
respectively, and fixed charges of $5,927,000 and $6,673,000 relating to such
guarantees for the six months ended June 30, 1994 and 1995, respectively, have
not been included in fixed charges.
DESCRIPTION OF DEBT SECURITIES
The Company may offer Debt Securities consisting of Senior Debt Securities,
Senior Subordinated Debt Securities or Subordinated Debt Securities, any of
which Debt Securities may be issued as Convertible Debt Securities, or any
combination of the foregoing, provided that the aggregate initial offering
price of the Debt Securities offered pursuant to the Registration Statement
will not exceed $3 billion (or the equivalent thereof denominated in one or
more foreign currencies, foreign currency units or composite currencies).
The Debt Securities will represent unsecured general obligations of the
Company. The Senior Debt Securities will be senior to all subordinated
indebtedness of the Company, and pari passu (equally and ratably) with other
unsecured, unsubordinated indebtedness of the Company. The Senior Subordinated
Debt Securities will be subordinate in right of payment to certain other debt
obligations of the Company, pari passu with certain other senior subordinated
indebtedness of the Company and senior to certain other subordinated
indebtedness of the Company. The Subordinated Debt Securities will be
subordinate in right of payment to certain other debt obligations of the
Company and pari passu with certain other subordinated indebtedness of the
Company. At June 30, 1995, the Company had an aggregate of approximately $7.65
billion of total Debt (as defined under "Senior Debt Securities--Definitions")
(including guarantees of indebtedness of others and the unaccreted portion of
indebtedness issued at a discount, but excluding indebtedness to
subsidiaries), substantially all of which would rank on a parity in right of
payment with the Senior Debt Securities. At that date, the Company and its
subsidiaries also had an aggregate of approximately $1.47 million in undrawn
lines of credit (excluding amounts related to lines of credit which provide
availability to support commercial paper).
The Company is a holding company and its assets consist primarily of
investments in its subsidiaries. A substantial portion of the consolidated
liabilities of the Company have been incurred by its subsidiaries. Therefore,
the Company's rights and the rights of its creditors, including holders of
Debt Securities, to participate in the distribution of assets of any
subsidiary upon the latter's liquidation or reorganization will be subject to
prior claims of the subsidiary's creditors, including trade creditors, except
to the extent that the Company may itself be a creditor with recognized claims
against the subsidiary (in which case the claims of the Company would still be
subject to the prior claims of any secured creditor of such subsidiary and of
any holder of indebtedness of such subsidiary that is senior to that held by
the Company). At June 30, 1995, the Company's subsidiaries had total Debt of
approximately $4.52 billion (including guarantees of indebtedness of others
and the unaccreted portion of indebtedness issued at a discount, but excluding
indebtedness owed to the Company).
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The Debt Securities will be obligations exclusively of the Company. The
Company's ability to service its indebtedness, including the Debt Securities,
is dependent primarily upon the earnings of its subsidiaries and the
distribution or other payment of such earnings to the Company in the form of
dividends, loans or advances, payment or reimbursement for management fees and
expenses, and repayment of loans and advances from the Company. The
subsidiaries are separate and distinct legal entities and have no obligation,
contingent or otherwise, to pay any amounts due pursuant to the Debt
Securities or to make any funds available therefor, whether by dividends,
loans or other payments. The payment of dividends or the making of loans and
advances to the Company by its subsidiaries may be subject to statutory or
regulatory restrictions, are contingent upon the earnings of those
subsidiaries and are subject to various business considerations. Further,
certain of the Company's subsidiaries are subject to loan agreements that
prohibit or limit the transfer of funds by such subsidiaries to the Company in
the form of loans, advances or dividends and require that such subsidiaries'
indebtedness to the Company be subordinate to the indebtedness under such loan
agreements. The amount of net assets of subsidiaries subject to such
restrictions exceeds the Company's consolidated net assets. The Parent is also
a separate and distinct legal entity and it has no obligation, contingent or
otherwise, to pay any amounts due pursuant to the Debt Securities or to make
any funds available therefor, whether by loans or other payments, except for
any particular series of convertible Debt Securities which the Parent has
specifically elected to guarantee. See "Guarantees of Convertible Debt
Securities."
The Senior Debt Securities will be issued under an Indenture to be executed
by the Company and The Bank of New York, as Trustee (the "Senior Indenture");
the Senior Subordinated Debt Securities will be issued under an Indenture to
be executed by the Company and a trustee designated in accordance with the
Trust Indenture Act of 1939, as amended (the "Trust Indenture Act") (the
"Senior Subordinated Indenture"); and the Subordinated Debt Securities will be
issued under an Indenture to be executed by the Company and a trustee
designated in accordance with the Trust Indenture Act (the "Subordinated
Indenture"). In this Prospectus, the Senior Indenture, the Senior Subordinated
Indenture and the Subordinated Indenture are sometimes collectively referred
to as the Indentures and individually as an Indenture and the Trustee under
the Senior Indenture, the Trustee under the Senior Subordinated Indenture and
the Trustee under the Subordinated Indenture are sometimes collectively
referred to as the Trustees and individually as a Trustee. In the event that
any convertible Debt Securities are guaranteed by the Parent, the applicable
Indenture will be supplemented by a supplemental indenture among the Company,
as issuer, the Parent, as guarantor, and the Trustee. Any such supplemental
indenture will be filed as an exhibit to a Current Report on Form 8-K to be
filed by the Company and TCI following the issuance of such series of
guaranteed convertible Debt Securities. See "Guarantees of Convertible Debt
Securities." The terms of the Senior Debt Securities, the Senior Subordinated
Debt Securities and the Subordinated Debt Securities include those stated in
the respective Indentures and in any supplemental indenture, and those made
part of the Indentures by reference to the Trust Indenture Act, as in effect
on the date of the Indentures. The Indentures (or form thereof, as the case
may be) are filed as exhibits to the Registration Statement. The Debt
Securities are subject to all such terms and holders of Debt Securities are
referred to the respective Indentures and the Trust Indenture Act for a
statement of such terms. See "Additional Information."
The following summaries of certain provisions of the Indentures do not
purport to be complete and are subject to, and qualified in their entirety by
reference to, all provisions of the Indentures. As used in this section
"Description of Debt Securities," unless the context indicates otherwise, the
term "Company" means TCI Communications, Inc. and does not include any of its
subsidiaries. All other capitalized terms used in this section and not
otherwise defined have the meanings assigned to them in the Indentures.
GENERAL
The Indentures do not limit the amount of Debt Securities which can be
issued thereunder and provide that Debt Securities may be issued in one or
more series, in such form, with such terms and up to the aggregate principal
amount authorized from time to time by the Company. (Sections 2.01 and 2.02 of
the Indentures)
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Reference is made to the Prospectus Supplement for the following terms of
the Offered Securities consisting of Debt Securities: (i) the designation
(including whether they are Senior Debt Securities, Senior Subordinated Debt
Securities or Subordinated Debt Securities), aggregate principal amount,
authorized denominations and currency or currencies in which principal,
premium, if any, and interest on the Offered Securities are payable; (ii)
whether the Offered Securities are to be issuable initially in temporary
global form and whether any of the Offered Securities are issuable in
permanent global form as Global Securities; (iii) whether the Offered
Securities are to be issuable as Registered Debt Securities or Bearer Debt
Securities or both; (iv) the index or indices used to determine the amount of
payments of principal, premium, if any, and interest on the Offered
Securities; (v) the percentage of their principal amount at which such Offered
Securities will be issued; (vi) the date on which the Offered Securities will
mature (which may be fixed or extendible); (vii) the rate or rates (which may
be fixed or variable) per annum, if any, at which the Offered Securities will
bear interest and the date from which such interest will accrue; (viii) the
times at which any such interest will be payable and with respect to
Registered Debt Securities the record date for the interest payable on any
interest payment date; (ix) any mandatory or optional sinking fund or
analogous provisions; (x) the date or dates, if any, on or after which, or the
circumstances under which, and the price or prices (and form or method of
payment thereof) at which the Offered Securities may be redeemed, purchased or
exchanged at the option of the Company or any holder; (xi) the initial
conversion price per share or conversion rate at which Offered Securities that
are convertible will be converted into Series A TCI Group Common Stock, any
specific terms relating to the adjustment thereof that are in addition to or
different from those described herein and the period during which such Offered
Securities may be so converted; (xii) if applicable, the terms of any
guarantee by the Parent of convertible Debt Securities; (xiii) any covenants
or Events of Default that are in addition to or different from those described
herein; and (xiv) any other specific terms. Reference is made to the
Prospectus Supplement with respect to the designation and qualification of the
Trustee under the Senior Subordinated Indenture and the Subordinated
Indenture.
If the purchase price of any Offered Securities is denominated in one or
more foreign currencies, foreign currency units or composite currencies, or if
the principal, premium, if any, and interest on any Offered Securities are
payable in one or more foreign currencies, foreign currency units or composite
currencies, the restrictions, elections, general tax considerations, specific
terms and other information with respect to such Offered Securities and such
foreign currency or currencies or foreign currency unit or units or composite
currencies will be set forth in the applicable Prospectus Supplement.
Debt Securities may be issued under the Indentures as Original Issue
Discount Securities to be sold at a substantial discount below their principal
amount ("original issue discount"). The issue price of Offered Securities that
are Original Issue Discount Securities, the amount of the original issue
discount with respect thereto, the manner and rate or rates per annum (which
may be fixed or variable) at which such original issue discount shall accrue,
the yield to maturity represented thereby, the date or dates from or to which
or period or periods during which such original issue discount shall accrue,
the portion of the principal amount of such Offered Securities that will be
payable upon acceleration of the maturity thereof or upon the optional or
mandatory redemption, purchase or exchange thereof, and any other specific
terms thereof will be described in the Prospectus Supplement relating thereto,
together with special federal income tax and other considerations applicable
to such Offered Securities.
SENIOR DEBT SECURITIES
The Senior Indenture contains, among others, the following covenants which
will apply to Offered Securities that are Senior Debt Securities unless
otherwise provided in the Prospectus Supplement for such Offered Securities:
Change of Control. With respect to the Senior Debt Securities of any series,
if both (i) a Change of Control shall occur at any time after the date on
which Senior Debt Securities of such series are first issued and on or prior
to the maturity thereof (or during such other period as may be specified for
such series in the related Prospectus Supplement) and (ii) on any date during
the period commencing 90 days before and ending 90 days after a public filing
has been made with the Commission or other general public disclosure has been
made
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indicating the occurrence of such Change of Control, the then current rating
of the Senior Debt Securities of such series by Duff & Phelps Credit Rating
Co. or its successor ("D&P") or by Moody's Investors Service, Inc. or its
successor ("Moody's") is downgraded to lower than BBB- (or an equivalent
successor rating or, if the rating of the Securities by D&P is lower than BBB-
(or an equivalent successor rating) at the beginning of such 180-day period,
the rating in effect at the beginning of such period), in the case of D&P, or
lower than Baa3 (or an equivalent successor rating or, if the rating of the
Securities by Moody's is lower than Baa3 (or an equivalent successor rating)
at the beginning of such 180-day period, the rating in effect at the beginning
of such period), in the case of Moody's and, in the event that such
downgrading shall have occurred during the 90-day period prior to such public
disclosure, the rating assigned to such series of Senior Debt Securities by
D&P or Moody's as of the close of business on the date of such public
disclosure remains lower than BBB- or lower than Baa3 (or such lower rating by
D&P or Moody's in effect at the beginning of such 180-day period, as the case
may be), respectively (the occurrence of the conditions specified in both (i)
and (ii) above being a "Put Event"), then each holder of Senior Debt
Securities of such series shall have the right to require the Company to
repurchase all or any portion of such holder's Senior Debt Securities of such
series at a purchase price equal to 100% of the principal amount thereof plus
accrued and unpaid interest, if any, to the date of purchase (or if the Senior
Debt Securities of such series are Original Issue Discount Securities, 100% of
that portion of the principal amount specified in the terms of that series
that would be payable if the maturity thereof were accelerated pursuant to the
Indenture), all as provided in, and subject to the terms of, the Senior
Indenture, as the Senior Indenture may be supplemented in connection with the
issuance of Senior Debt Securities thereunder. Subsequent to the occurrence of
a Put Event, the Company will give a notice to each holder of Senior Debt
Securities of such series setting forth, among other things, details regarding
the right of such holder to require the Company to repurchase such holder's
Senior Debt Securities of such series, the purchase date, and the name and
address of the Paying Agent (which for this purpose will, in the case of
Registered Securities, be the Trustee and, in the case of Bearer Securities,
will be a Paying Agent in a place of payment located outside the United
States) to which such Senior Debt Securities are to be presented and
surrendered. The Company will not be obligated, with respect to the Senior
Debt Securities of any series, to purchase such Senior Debt Securities or give
notice to the holders thereof with respect to more than one Put Event.
(Section 4.02 of the Senior Indenture) The obligation of the Company to
purchase Senior Debt Securities put to it pursuant to this covenant will rank
senior to its obligations in respect of the Senior Subordinated Debt
Securities and the Subordinated Debt Securities. The applicability of this
covenant is limited to the circumstances described above and this covenant is
not designed to, and may not, provide rights to the holders of Senior Debt
Securities in all circumstances in which the market value of the Senior Debt
Securities held by them may be adversely affected, whether as the result of
the Company's engaging in a highly leveraged transaction or otherwise.
The Company will comply with any applicable requirements of Rule 14e-1
promulgated under the Exchange Act and any applicable securities laws and
regulations in connection with the performance of its obligations under this
covenant.
Limitation on Liens. Subject to certain specified exceptions, as long as any
Senior Debt Securities of a series entitled to the benefit of this covenant
are outstanding, the Company will not, and will not permit any Restricted
Subsidiary to, create, incur or assume any Lien on Restricted Property to
secure the payment of Funded Debt of the Company or any Restricted Subsidiary
if immediately after the creation, incurrence or assumption of such Lien, the
aggregate outstanding principal amount of all Funded Debt of the Company and
the Restricted Subsidiaries that is secured by Liens on Restricted Property
would exceed fifteen percent (15%) of the Maximum Funded Debt Amount, unless
effective provision is made whereby the Senior Debt Securities (together with,
if the Company shall so determine, any other Funded Debt ranking equally with
the Senior Debt Securities, whether then existing or thereafter created) are
secured equally and ratably with (or prior to) such Funded Debt (but only for
so long as such Funded Debt is so secured). (Section 4.04 of the Senior
Indenture)
Limitation on Restricted Subsidiary Funded Debt. As long as any Senior Debt
Securities of a series entitled to the benefit of this covenant are
outstanding, the Company will not permit any Restricted Subsidiary to incur or
assume any Funded Debt if immediately after the incurrence or assumption of
such Funded Debt, the
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aggregate outstanding principal amount of all Funded Debt of the Restricted
Subsidiaries would exceed fifteen percent (15%) of the Maximum Funded Debt
Amount. Notwithstanding the foregoing, any Restricted Subsidiary may incur
Funded Debt to extend, renew or replace Funded Debt of such Restricted
Subsidiary provided that the principal amount of the Funded Debt so incurred
does not exceed the principal amount of the Funded Debt extended, renewed or
replaced thereby immediately prior to such extension, renewal or replacement
plus any premium, accrued and unpaid interest or capitalized interest payable
thereon. (Section 4.05 of the Senior Indenture) The Senior Indenture do not
limit the incurrence of Funded Debt, or any other debt, secured or unsecured,
by the Company, except as described under "Limitation on Liens," or by any
Unrestricted Subsidiary.
Designation of Restricted Subsidiaries. With respect to the Senior Debt
Securities of any series, the Company may designate an Unrestricted Subsidiary
as a Restricted Subsidiary or designate a Restricted Subsidiary as an
Unrestricted Subsidiary at any time, provided that (1) immediately after
giving effect to such designation, the Leverage Ratio of the Restricted Group
is not greater than 8.0:1 and the Company and the Restricted Subsidiaries are
in compliance with the "Limitation on Liens" and "Limitation on Restricted
Subsidiary Funded Debt" covenants, and (2) an Officers' Certificate with
respect to such designation is delivered to the Trustee within 75 days after
the end of the fiscal quarter of the Company in which such designation is made
(or, in the case of a designation made during the last fiscal quarter of the
Company's fiscal year, within 120 days after the end of such fiscal year),
which Officers' Certificate shall state the effective date of such
designation. The Company shall make the initial designation of Restricted
Subsidiaries with respect to the Senior Debt Securities of any series, and
deliver the required Officers' Certificate with respect thereto to the
Trustee, on or prior to the date of initial issuance of Senior Debt Securities
of such series. (Section 4.03 of the Senior Indenture)
Definitions. The following are certain of the terms defined in the Senior
Indenture (Section 1.01):
"Change of Control" means the occurrence of either of the following events
(to the extent applicable): (A) the acquisition by any person (other than the
Parent, the Company, any Subsidiary or Parent Subsidiary, any employee stock
ownership or other employee benefit plan of the Parent or the Company or of
any Subsidiary or Parent Subsidiary, or any Controlling Person) during any
period of twelve (12) consecutive months of beneficial ownership of shares of
the Class A Stock or Class B Stock or both representing in the aggregate
thirty percent (30%) or more of the combined voting power of all shares of the
Class A Stock and Class B Stock, calculated on a fully diluted basis as of the
date immediately prior to the date of such acquisition (or, if there be more
than one acquisition during such twelve-month period, the date of the last
such acquisition); provided, however, that notwithstanding the foregoing, no
Change of Control shall be deemed to have occurred if and for so long as the
shares of the Class A Stock and Class B Stock beneficially owned by the
Parent, the Parent Subsidiaries (other than the Company) and the Controlling
Persons represent in the aggregate 30% or more of the combined voting power of
all shares of the Class A Stock and Class B Stock calculated on a fully
diluted basis, or (B) for so long as the Company is a Parent Subsidiary, the
acquisition by any person (other than the Parent, any Parent Subsidiary, any
employee stock ownership plan or other employee benefit plan of the Parent or
any Parent Subsidiary, or any Controlling Person) during any period of twelve
(12) consecutive months of beneficial ownership of shares of common stock of
the Parent representing in the aggregate thirty percent (30%) or more of the
combined voting power of all shares of the Parent's common stock, calculated
on a fully diluted basis as of the date immediately prior to the date of such
acquisition (or, if there be more than one acquisition during such twelve-
month period, the date of the last such acquisition); provided, however, that
notwithstanding the foregoing no Change of Control shall be deemed to have
occurred if and for so long as the shares of the Parent's common stock
beneficially owned by the Controlling Persons represent in the aggregate 30%
or more of the combined voting power of all shares of the Parent's common
stock calculated on a fully diluted basis.
"Class A Stock" means the Class A Common Stock, $1.00 par value, of the
Company as it exists on the date of the Senior Indenture and stock of any
other class into which such Class A Common Stock may thereafter have been
changed.
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"Class B Stock" means the Class B Common Stock, $1.00 par value, of the
Company as it exists on the date of the Senior Indenture and stock of any other
class into which such Class B Common Stock may thereafter have been changed.
"Company" means TCI Communications, Inc., a Delaware corporation, until a
successor replaces it pursuant to the applicable provisions of the Indenture
and thereafter means the successor.
"Controlling Person" means each of (1) the Chairman of the Board of the
Parent as of the date of the Indenture, (2) the President of the Parent as of
the date of the Indenture, (3) each of the directors of the Parent as of the
date of the Indenture, (4) the respective family members, estates and heirs of
each of the persons referred to in clauses (1) through (3) above and any trust
or other investment vehicle for the primary benefit of any of such persons or
their respective family members or heirs, (5) Kearns-Tribune Corporation, a
Delaware corporation or any successor thereto by merger or consolidation and
(6) the trustee under the Parent's Employee Stock Purchase Plan or any
successor plan or any other employee stock ownership or other employee benefit
plan of the Parent or the Company or of any Subsidiary or Parent Subsidiary. As
used with respect to any person, the term "family member" means the spouse,
siblings and lineal descendants of such person. The trustee under the Parent's
Employee Stock Purchase Plan or any successor plan or any other employee stock
ownership or other employee benefit plan of the Parent or the Company or of any
Subsidiary or Parent Subsidiary shall be deemed to have beneficial ownership of
all shares of common stock of the Parent or the Company held under the plan,
whether or not allocated to or vested in participants' accounts.
"Debt" of any person means:
(1) any indebtedness of such person (i) for borrowed money or (ii) evidenced
by a note, debenture or similar instrument (including a purchase money
obligation) given in connection with the acquisition of any property or assets,
including securities;
(2) any guarantee by such person of any indebtedness of others described in
the preceding clause (1); and
(3) any amendment, extension, renewal or refunding of any such indebtedness
or guarantee.
"Funded Debt" of any person means, as of the date as of which the amount
thereof is to be determined, without duplication, all indebtedness of such
person for borrowed money and all guaranties by such person of any indebtedness
of others for borrowed money, which by its terms has a final maturity, duration
or payment date more than one year from the date of determination thereof
(including, without limitation, any balance of such indebtedness which was
Funded Debt at the time of its creation maturing within one year from such date
of determination) or which has a final maturity, duration or payment date
within one year from such date of determination but which by its terms may be
renewed or extended at the option of such person for more than one year from
such date of determination, whether or not theretofore renewed or extended.
When used with respect to the Company or any Restricted Subsidiary, the term
"Funded Debt" excludes (1) any indebtedness of the Company or any Restricted
Subsidiary to the Company or another Restricted Subsidiary, (2) any guarantee
by the Company or any Restricted Subsidiary of indebtedness of the Company or
another Restricted Subsidiary, provided that such guarantee is not secured by a
Lien on Restricted Property, and (3) with respect to any series of Senior Debt
Securities, any indebtedness of the Company or any Restricted Subsidiary to any
Unrestricted Subsidiary which indebtedness is subordinated in right of payment
to the prior payment in full of the outstanding Senior Debt Securities of such
series on terms no less favorable to the holders of such Senior Debt Securities
than those contained in Article Ten of the subordinated Indenture pursuant to
which Subordinated Debt Securities issued by the Company are subordinated to
all Senior Debt of the Company (as defined therein), without giving effect to
any amendment, modification or supplement to, or discharge of, the Subordinated
Indenture after the date of the Senior Indenture, and which indebtedness is not
secured by a Lien on Restricted Property. For purposes of determining the
outstanding principal amount of Funded Debt at any date, the amount of
indebtedness issued at a price less than the principal amount thereof shall be
equal to the amount of the liability in respect thereof at such date determined
in accordance with generally accepted accounting principles.
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"Leverage Ratio" with respect to the Restricted Group means, as of the date
of and after giving effect to any designation of an Unrestricted Subsidiary as
a Restricted Subsidiary and/or any designation of a Restricted Subsidiary as an
Unrestricted Subsidiary, in each case in accordance with the "Designation of
Restricted Subsidiaries" covenant, the ratio of (1) the aggregate outstanding
principal amount of all Funded Debt of the Restricted Group as of such date to
(2) the product of four times the restricted Group Cash Flow for the most
recent full fiscal quarter for which financial information is available on such
date.
"Lien" means any mortgage, pledge, lien, security interest, or other similar
encumbrance.
"Maximum Funded Debt Amount" means, as of any date of determination thereof,
that amount which is equal to the product of (i) eight and (ii) the product of
(x) the Restricted Group Cash Flow for the most recent full fiscal quarter for
which financial information is available on such date and (y) four.
"Parent" means Tele-Communications, Inc., a Delaware corporation, and any
successor thereof.
"Principal Property" means, as of any date of determination, any property or
assets owned by any Restricted Subsidiary other than (1) any such property
which, in the good faith opinion of the Board of Directors, is not of material
importance to the business conducted by the Company and its Restricted
Subsidiaries taken as a whole and (2) any shares of any class of stock or any
other security of any Unrestricted Subsidiary.
"Restricted Group" means, as of any date of determination, the Company and
the Restricted Subsidiaries as of such date after giving effect to any
designation being made on such date in accordance with the "Designation of
Restricted Subsidiaries" covenant.
"Restricted Group Cash Flow" for any period means the Restricted Group Net
Income (as defined below) for such period, plus (A) the sum (without
duplication) of the aggregate of each of the following items of the Company and
the Restricted Subsidiaries for such period to the extent taken into account as
charges to Restricted Group Net Income for such period: (i) interest expense,
(ii) income tax expense, (iii) depreciation and amortization expense and other
noncash charges, (iv) extraordinary items and (v) after-tax losses on sales of
assets outside of the ordinary course of business not otherwise included in
extraordinary items in accordance with generally accepted accounting
principles, minus (B) the sum (without duplication) of the aggregate of each of
the following items of the Company and the Restricted Subsidiaries for such
period to the extent taken into account as credits to Restricted Group Net
Income for such period: (i) noncash credits, (ii) extraordinary items, and
(iii) after-tax gains on sales of assets outside of the ordinary course of
business not otherwise included in extraordinary items in accordance with
generally accepted accounting principles.
For purposes of this definition, (1) "Restricted Group Net Income" for any
period means the aggregate of the net income (loss) for such period of the
Company and the Restricted Subsidiaries, determined on a consolidated basis in
accordance with generally accepted accounting principles; provided, however,
that (i) the net income (loss) of any person accounted for by the equity method
of accounting and the net income (loss) of any Unrestricted Subsidiary shall be
excluded, except that the net income of any such person or Unrestricted
Subsidiary shall be included to the extent of the amount of dividends or
distributions paid by such person or Unrestricted Subsidiary to the Company or
a Restricted Subsidiary during such period, and (ii) except as otherwise
provided in clause (2) below, the net income (loss) of any other person
acquired by the Company or any Restricted Subsidiary in a transaction accounted
for as a pooling of interests for any period prior to the date of such
acquisition shall be excluded; and (2) if the Company or any Restricted
subsidiary consummated any acquisition or deposition of assets during the
period for which Restricted Group Cash Flow is being calculated, or consummated
any acquisition or disposition of assets subsequent to such period and on or
prior to the date as of which the Leverage Ratio or Maximum Funded Debt Amount,
as applicable, is to be determined, then, in each such case, the restricted
Group Cash Flow for such period shall be calculated on a pro forma basis as if
such acquisition or disposition had occurred at the beginning of such period.
"Restricted Property" means, as of any date of determination, any Principal
Property and any shares of stock of a Restricted Subsidiary owned by the
Company or a Restricted Subsidiary.
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"Restricted Subsidiary" means, as of any date of determination, a corporation
a majority of whose voting stock is owned by the Company and/or one or more
Restricted Subsidiaries, which corporation has been, or is then being,
designated a Restricted Subsidiary in accordance with the "Designation of
Restricted Subsidiaries" covenant, unless and until designated an Unrestricted
Subsidiary in accordance with such covenant.
"Subsidiary" means a corporation a majority of whose voting stock is owned by
the Company and/or one or more Subsidiaries. Voting stock is capital stock
having voting power under ordinary circumstances to elect directors.
"Unrestricted Subsidiary" means, as of any date of determination, any
Subsidiary of the Company that is not a Restricted Subsidiary.
SENIOR SUBORDINATED DEBT SECURITIES
The following provisions will apply to Offered Securities that are Senior
Subordinated Debt Securities unless otherwise provided in the Prospectus
Supplement for such Offered Securities.
Subordination. The indebtedness evidenced by the Senior Subordinated Debt
Securities will be subordinate to the prior payment in full of all Senior Debt
as described below. The Indenture does not limit Senior Debt or any other debt,
secured or unsecured, of the Company or any subsidiary, except as described
under "Limitation on Subordinated Debt Superior to the Senior Subordinated Debt
Securities" below. Upon maturity (by acceleration or otherwise) of any Senior
Debt, payment in full must be made on such Senior Debt (or duly provided for)
before any payment is made on or in respect of the Senior Subordinated Debt
Securities (except payments made in capital stock of the Company or in
warrants, rights or options to purchase or acquire capital stock of the
Company, sinking fund payments made in Senior Subordinated Debt Securities
acquired by the Company before the maturity of such Senior Debt, and payments
made through the exchange of other debt obligations of the Company for such
Senior Subordinated Debt Securities in accordance with the terms of such Senior
Subordinated Debt Securities provided that such Debt obligations are
subordinated to Senior Debt at least to the extent that the Senior Subordinated
Debt Securities for which they are exchanged are so subordinated in accordance
with the Indenture). During the continuance of any default in payment of the
principal of, premium, if any, interest on, or other amounts due in respect of,
any Senior Debt, no payment may be made by the Company on, or in respect of,
the Senior Subordinated Debt Securities (except payments made in capital stock
of the Company or in warrants, rights or options to purchase or acquire capital
stock of the Company, sinking fund payments made in Senior Subordinated Debt
Securities acquired by the Company before such default and notice thereof, and
payments made through the exchange of other debt obligations of the Company for
such Senior Subordinated Debt Securities in accordance with the terms of such
Senior Subordinated Debt Securities provided that such debt obligations are
subordinated to Senior Debt at least to the extent that the Senior Subordinated
Debt Securities for which they are exchanged are so subordinated in accordance
with the Indenture). Upon any distribution of assets of the Company in any
dissolution, winding up, liquidation or reorganization of the Company, payment
of all amounts due in respect of the Senior Subordinated Debt Securities will
be subordinated, to the extent and in the manner set forth in the Indenture, to
the prior payment in full of all Senior Debt. Such subordination will not
prevent the occurrence of any Event of Default. (Sections 10.01, 10.02, 10.03
and 10.11 of the Indenture) The Indenture for the Senior Debt Securities
contains a cross-acceleration provision that would, among other things, permit
the acceleration of the maturity of any outstanding Senior Debt Securities in
the event that the maturity of any outstanding Senior Subordinated Debt
Securities or Subordinated Debt Securities were accelerated. See "Defaults and
Remedies" below. The instruments and agreements pursuant to which all or
substantially all of the Company's Senior Debt has been incurred also contain
cross-default or cross-acceleration provisions.
Securities Senior to Junior Subordinated Debt. The indebtedness evidenced by
the Senior Subordinated Debt Securities will be superior in right of payment to
all Junior Subordinated Debt as described below. Upon maturity (by acceleration
or otherwise) of the Senior Subordinated Debt Securities of any series, payment
in full must be made thereon, or duly provided for, before any payment is made
on or in respect of any Junior
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Subordinated Debt (except payments made in capital stock of the Company or in
warrants, rights or options to purchase or acquire capital stock of the
Company, sinking fund payments made in instruments evidencing Junior
Subordinated Debt of the same issue acquired before the maturity of the Senior
Subordinated Debt Securities of such series, and payments made through the
exchange of other debt obligations of the Company for such Junior Subordinated
Debt in accordance with the terms of such Junior Subordinated Debt provided
that such debt obligations are subordinated to the Senior Subordinated Debt
Securities at least to the extent that the Junior Subordinated Debt for which
they are exchanged is so subordinated in accordance with the Indenture). During
the continuance of any default in payment of the principal of, premium, if any,
interest on, or other amounts due in respect of, the Senior Subordinated Debt
Securities of any series, no payment may be made by the Company on, or in
respect of, any Junior Subordinated Debt (except payments made in capital stock
of the Company or in warrants, rights or options to purchase or acquire capital
stock of the Company, sinking fund payments made in instruments evidencing
Junior Subordinated Debt of the same issue acquired before such default and
notice thereof, and payments made through the exchange of other debt
obligations of the Company for such Junior Subordinated Debt in accordance with
the terms of such Junior Subordinated Debt provided that such debt obligations
are subordinated to the Senior Subordinated Debt Securities at least to the
extent that the Junior Subordinated Debt for which they are exchanged is so
subordinated in accordance with the Indenture). Upon any distribution of assets
of the Company in any dissolution, winding up, liquidation or reorganization of
the Company, holders of the Senior Subordinated Debt Securities will be
entitled to receive payment in full of all amounts due in respect thereof
before the holders of any Junior Subordinated Debt are entitled to receive any
payment on account of such Junior Subordinated Debt. (Section 4.05 of the
Indenture)
Limitation on Subordinated Debt Superior to the Senior Subordinated Debt
Securities. As long as any Senior Subordinated Debt Securities remain
outstanding, the Company may not create or incur any Debt which is subordinate
or junior in right of payment to any Senior Debt if such Debt is superior in
right of payment to the Senior Subordinated Debt Securities. (Section 4.06 of
the Indenture)
Definitions. The following are certain of the terms defined in the Indenture
(Sections 4.06 and 10.01):
"Junior Subordinated Debt" means the principal of (premium, if any) and
interest on Debt of the Company created or incurred after the date of the
Indenture which by its terms is subordinate in right of payment to the Senior
Subordinated Debt Securities, including any Subordinated Debt Securities issued
under the Subordinated Indenture.
"Senior Debt" means the principal of (premium, if any) and interest on Debt
of the Company outstanding at any time other than (i) the Senior Subordinated
Debt Securities, (ii) the Company's outstanding 11 1/8% senior subordinated
debentures due October 1, 2003, which shall rank pari passu with the Senior
Subordinated Debt Securities, (iii) any Subordinated Debt Securities issued
under the Subordinated Indenture, and (iv) Debt which by its terms is not
superior in right of payment to the Senior Subordinated Debt Securities.
The definition of "Debt" in the Senior Subordinated Indenture is the same as
that in the Senior Indenture.
Nothing in the Indenture affords holders of Senior Subordinated Debt
Securities protection in the event of a highly leveraged transaction,
reorganization, restructuring, merger or similar, transaction involving the
Company.
SUBORDINATED DEBT SECURITIES
The following provisions will apply to Offered Securities that are
Subordinated Debt Securities unless otherwise provided in the Prospectus
Supplement for such Offered Securities:
Subordination. The indebtedness evidenced by the Subordinated Debt Securities
will be subordinate to the prior payment in full of all Senior Debt as
described below. The Indenture does not limit Senior Debt or any other debt,
secured or unsecured, of the Company or any subsidiary. Upon maturity (by
acceleration or otherwise) of any Senior Debt, payment in full must be made on
such Senior Debt (or duly provided for) before any payment is made on or in
respect of the Subordinated Debt Securities (except payments made in capital
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stock of the Company or in warrants, rights or options to purchase or acquire
capital stock of the Company, sinking fund payments made in Subordinated Debt
Securities acquired by the Company before the maturity of such Senior Debt, and
payments made through the exchange of other debt obligations of the Company for
such Subordinated Debt Securities in accordance with the terms of such
Subordinated Debt Securities provided that such debt obligations are
subordinated to Senior Debt at least to the extent that the Subordinated Debt
Securities for which they are exchanged are so subordinated in accordance with
the Indenture). During the continuance of any default in payment of the
principal of, premium, if any, interest on, or other amounts due in respect of,
any Senior Debt, no payment may be made by the Company on, or in respect of,
the Subordinated Debt Securities (except payments made in capital stock of the
Company or in warrants, rights or options to purchase or acquire capital stock
of the Company, sinking fund payments made in Subordinated Debt Securities
acquired by the Company before such default and notice thereof, and payments
made through the exchange of other debt obligations of the Company for such
Subordinated Debt Securities in accordance with the terms of such Subordinated
Debt Securities provided that such debt obligations are subordinated to Senior
Debt at least to the extent that the Subordinated Debt Securities for which
they are exchanged are so subordinated in accordance with the Indenture). Upon
any distribution of assets of the Company in any dissolution, winding up,
liquidation or reorganization of the Company, payment of all amounts due in
respect of the Subordinated Debt Securities will be subordinated, to the extent
and in the manner set forth in the Indenture, to the prior payment in full of
all Senior Debt. Such subordination will not prevent the occurrence of any
Event of Default. (Sections 10.01, 10.02, 10.03 and 10.11 of the Indenture) The
Indenture for the Senior Debt Securities contains a cross-acceleration
provision that would, among other things, permit the acceleration of the
maturity of any outstanding Senior Debt Securities in the event that the
maturity of any outstanding Senior Subordinated Debt Securities or Subordinated
Debt Securities were accelerated. See "Defaults and Remedies" below. The
instruments and agreements pursuant to which all or substantially all of the
Company's Senior Debt has been incurred also contain cross-default or cross-
acceleration provisions.
"Senior Debt" means the principal of (premium, if any) and interest on Debt
of the Company outstanding at any time other than (i) the Subordinated Debt
Securities, and (ii) Debt which by its terms is not superior in right of
payment to the Subordinated Debt Securities. The definition of "Debt" in the
Subordinated Indenture is the same as that in the Senior Indenture.
Nothing in the Indenture affords holders of Subordinated Debt Securities
protection in the event of a highly leveraged transaction, reorganization,
restructuring, merger or similar transaction involving the Company.
CONVERTIBLE DEBT SECURITIES
In addition to the provisions described under the applicable of "Senior Debt
Securities", "Senior Subordinated Debt Securities" or "Subordinated Debt
Securities" above, the following provisions will apply to Offered Securities
that are convertible Debt Securities unless otherwise provided in the
Prospectus Supplement for such Offered Securities:
For purposes of the conversion provisions of each Indenture, "Parent Stock"
means the Series A TCI Group Common Stock and any other capital stock into
which the Parent Stock may be changed after the date of such Indenture.
(Section 1.01 of the Indentures)
Conversion. The holder of any convertible Debt Security will have the right,
exercisable at any time up to and including the maturity date thereof (or such
shorter period as may be specified for any series of convertible Debt
Securities in the Prospectus Supplement relating thereto), unless previously
redeemed or otherwise purchased, to convert such Debt Security at the principal
amount thereof (or, if such Debt Security is an Original Issue Discount
Security, such portion of the principal amount thereof as is specified in the
terms of such Debt Security) into shares of Parent Stock at the conversion
price or conversion rate set forth in the Prospectus Supplement, subject to
adjustment as described below. The holder of a convertible Debt Security may
convert a portion thereof if the portion to be converted and the remaining
portion of such Debt Security are in
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denominations issuable for that series of Debt Securities. (Section 10.01 of
the Senior Indenture and Section 11.01 of the Senior Subordinated and
Subordinated Indentures) In the case of Debt Securities called for redemption,
conversion rights will expire at the close of business on such day on or prior
to the redemption date as may be specified in the Prospectus Supplement.
The conversion price or conversion rate of the convertible Debt Securities,
or the securities or other property to be received on conversion, is subject to
adjustment upon the occurrence of certain events, including (i) the payment of
a dividend or the making of a distribution in shares of Parent Stock to holders
of Parent Stock or the payment of a dividend or the making of a distribution to
holders of Parent Stock payable in shares of the Parent's capital stock other
than Parent Stock; (ii) the subdivision, combination or reclassification of
outstanding shares of Parent Stock; (iii) the issuance to all holders of Parent
Stock of rights or warrants entitling them (for a period not exceeding 45 days
or such other period as may be specified in the Prospectus Supplement) to
purchase shares of Parent Stock (or, unless otherwise provided in the
Prospectus Supplement, securities (other than the convertible Debt Securities
and shares of Series B TCI Group Common Stock of Parent) convertible into
Parent Stock) at a price per share (or, in the case of such convertible
securities, having a conversion price per share after adding thereto an
allocable portion of the exercise price of the right or warrant to purchase
such convertible securities) less than the Average Market Price on the
Determination Date (each as defined in the Indentures) per share of such Parent
Stock; (iv) the distribution to all holders of Parent Stock of evidences of
indebtedness or assets (excluding cash dividends or distributions unless
otherwise provided in the Prospectus Supplement) or certain rights or warrants
(other than those referred to above); and (v) certain mergers, consolidations
or sales of assets. In the case of any such dividend or distribution on the
Parent Stock of shares of capital stock, subdivision, combination or
reclassification, the holder of each outstanding convertible Debt Security will
have the right to convert such Debt Security into the kind and amount of
securities which he would have owned immediately after such event if he had
converted such Debt Security immediately before the record date for or
effective date of, as the case may be, such event. In the case of any such
merger, consolidation or sale of assets, the holder of each outstanding
convertible Debt Security will have the right to convert such Debt Security
into the kind and amount of securities, cash or other assets receivable upon
such merger, consolidation or sale by a holder of the number of shares of
Parent Stock into which such Debt Security could have been converted
immediately before the effective date of such transaction (assuming such holder
of Parent Stock failed to exercise any rights of election and received per
share of Parent Stock the kind and amount of securities, cash or other assets
received per share by a plurality of the non-electing shares.) In the case of
any such issuance of rights or warrants which expire within 45 days (or such
other period as may be specified in the Prospectus Supplement) after the record
date for the determination of stockholders entitled to receive the rights or
warrants, or any such distribution of evidences of indebtedness or assets or
other rights or warrants, the conversion price or conversion rate will be
adjusted pursuant to formulas contained in the Indentures. However, no
adjustment to the conversion price or conversion rate need be made if the
holders may participate in the transaction or in certain other cases.
In addition to the foregoing adjustments, the Company will be permitted to
make such reductions in the conversion price or increases in the conversion
rate as it considers to be advisable. Unless otherwise provided in the
Prospectus Supplement, the Company is not required to make adjustments in the
conversion price or conversion rate of less than 1% of the initial conversion
price or conversion rate, as the case may be, but any adjustment that would
otherwise be required to be made will be taken into account in the computation
of any subsequent adjustment. No adjustment is required in respect of the
issuance of Parent Stock under any dividend or interest reinvestment plan of
the Parent. Fractional shares of Parent Stock will not be issued upon
conversion, but, in lieu thereof, the Company will pay a cash adjustment. No
payment or adjustment will be made upon any conversion on account of any
interest (or, in the case of Original Issue Discount Securities, original issue
discount) accrued on the convertible Debt Securities surrendered for conversion
or on account of any dividends on the Parent Stock issued upon conversion.
Convertible Debt Securities surrendered for conversion between the record date
for an interest payment, if any, and the interest payment date (except
convertible Debt Securities called for redemption on a redemption date during
such period) may be required to be accompanied by payment of an amount equal to
the interest thereon which the registered holder is to receive. (Article Ten of
the Senior Indenture and Article Eleven of the Senior Subordinated and
Subordinated Indentures)
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GUARANTEES OF CONVERTIBLE DEBT SECURITIES
The Parent may, at its option, unconditionally guarantee to the holders from
time to time of specified series of convertible Debt Securities the full and
prompt payment of principal, premium, if any, and interest when and as the same
shall become due and payable, whether at maturity, upon redemption or
otherwise. The terms of any such guarantees (each a "Guarantee") will be set
forth in the applicable supplemental indenture. Any such Guarantee will be an
unsecured obligation of the Parent. Any right of payment of the holders of
Senior Debt Securities under the related Guarantee will be prior to the right
of payment of the holders of convertible Senior Subordinated Debt Securities
and Subordinated Debt Securities under the related Guarantee, and any right of
payment of the holders of convertible Senior Subordinated Debt Securities under
the related Guarantee will be prior to the right of payment of the holders of
Subordinated Debt Securities under the related Guarantee.
If a Guarantee is applicable to convertible Debt Securities offered hereby,
reference is made to the related supplemental indenture and the accompanying
Prospectus Supplement for a description of the specific terms of such
Guarantee, including events of default relating thereto and, where applicable,
subordination provisions of such Guarantee and covenants of the Parent. Unless
otherwise specified in the applicable Prospectus Supplement, the Debt
Securities will not be guaranteed by the Parent.
DENOMINATION AND FORM
Unless otherwise indicated in the Prospectus Supplement, the Offered
Securities will be Registered Debt Securities denominated in U.S. Dollars and
will be issued only in denominations of $1,000 and integral multiples of
$1,000. (Section 2.03 of the Senior Subordinated and Subordinated Indentures
and Sections 2.01 and 2.03 of the Senior Indenture) Under the Senior Indenture,
Debt Securities of any series may be issuable as Registered Debt Securities,
Bearer Debt Securities (with or without coupons attached) or both, and may be
issuable in whole or in part in the form of one or more Global Securities. In
addition, the Senior Indenture provides that Debt Securities may be denominated
or payable in one or more foreign currencies, foreign currency units or
composite currencies. (Sections 2.01 and 2.02 of the Senior Indenture) Unless
otherwise indicated in the applicable Prospectus Supplement, Bearer Debt
Securities denominated in U.S. Dollars will be issued only in the denomination
of $5,000 with coupons attached. (Sections 2.01 and 2.03 of the Senior
Indenture) A Global Security will be issued in a denomination equal to the
aggregate principal amount of outstanding Debt Securities represented by such
Global Security. (Section 2.10 of the Senior Indenture and Section 2.15 of the
Senior Subordinated and the Subordinated Indentures) The Prospectus Supplement
relating to a series of Debt Securities denominated other than in U.S. Dollars
will specify the authorized denominations thereof.
During the "restricted period," as defined in Treasury Regulation Section
1.163-5(c)(2)(i)(D)(7), no Bearer Debt Security may be offered or sold (or
resold in connection with its original issuance) in the United States or its
possessions or to a United States person (subject to certain exceptions).
Further, no Bearer Debt Security may be mailed or otherwise delivered to any
location in the United States or its possessions in connection with a sale that
occurred during the restricted period. Offered Securities that are Bearer Debt
Securities will be subject to certification requirements as to the ownership of
such Bearer Debt Security (including beneficial interests in a Global Security
representing such Bearer Debt Security) which will be described in the
applicable Prospectus Supplement. See "Limitations on Issuance of Bearer Debt
Securities."
REGISTRAR, PAYING AGENT, CONVERSION AGENT
The Company will maintain an office or agency where Registered Debt
Securities of each series may be presented for registration of transfer or for
exchange ("Registrar"), an office or agency where Debt Securities of each
series may be presented for payment ("Paying Agent") and an office or agency
where Debt Securities of each series that is convertible may be presented for
conversion ("Conversion Agent"). The Company may have one or more co-
Registrars, one or more additional Paying Agents and one or more additional
Conversion Agents with respect to any series of Debt Securities and the Company
or any of its subsidiaries may act as Paying Agent, Registrar or co-Registrar
or Conversion Agent. Unless otherwise indicated in an applicable Prospectus
Supplement, each Trustee will initially act as Paying Agent and Registrar for
each series of Debt Securities
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issued under its respective Indenture and as Conversion Agent for any series
that is convertible. The Company may change any Paying Agent, Registrar or co-
Registrar or Conversion Agent at any time without notice to the holders of
Debt Securities, except as described below with respect to Debt Securities
issued under the Senior Indenture. The Company will promptly notify the
Trustee of the name and address of any such Agent. (Section 2.05 of the
Indentures)
The Senior Indenture also provides that if Debt Securities of a series are
issuable as Bearer Debt Securities, the Company will maintain (i) in the
Borough of Manhattan, The City of New York, an office or agency where any
Registered Debt Securities of that series may be presented or surrendered for
payment and for registration of transfer, where Debt Securities of that series
may be surrendered for exchange and where Bearer Debt Securities of that
series and related coupons may be presented or surrendered for payment in the
circumstances described under "Payment" below, and (ii) subject to any laws or
regulations applicable thereto, in a place of payment for Debt Securities of
that series located outside the United States, an office or agency where any
Registered Debt Securities of that series may be surrendered for registration
of transfer, where Debt Securities of that series may be surrendered for
exchange and where Debt Securities of that series and any related coupons may
be presented and surrendered for payment, provided that if the Debt Securities
of that series are listed on The International Stock Exchange of the United
Kingdom and the Republic of Ireland, the Luxembourg Stock Exchange or any
other stock exchange located outside the United States and such stock exchange
shall so require, the Company will maintain a Paying Agent for the Debt
Securities of that series in London, Luxembourg or any other required city
located outside the United States, as the case may be, so long as the Debt
Securities of that series are listed on such exchange. Any Paying Agents
outside the United States initially designated by the Company for the Offered
Securities will be named in the applicable Prospectus Supplement. The Company
will promptly notify the Trustee and the holders of Debt Securities of a
series of the location and any change in the location of any office or agency
which it is required to maintain for the Debt Securities of such series.
(Section 4.01 of the Senior Indenture)
TRANSFER AND EXCHANGE
Registered Debt Securities of any series (other than a Global Security,
except as provided under "Global Securities") will be exchangeable at the
option of the holder for other Registered Debt Securities of the same series
of any authorized denominations and of a like aggregate principal amount and
tenor. (Section 2.08 of the Indenture) In addition, if Debt Securities of any
series issued under the Senior Indenture are issuable as both Registered Debt
Securities and Bearer Debt Securities, then, if so provided with respect to
the Debt Securities of such series, at the option of the holder and subject to
the terms of such Indenture, Bearer Debt Securities (with, except as provided
below, all related unmatured coupons and all related matured coupons in
default) of such series will be exchangeable for Registered Debt Securities of
the same series of any authorized denominations and of a like aggregate
principal amount and tenor. Bearer Debt Securities surrendered in exchange for
Registered Debt Securities between a regular date or, in certain
circumstances, a special record date, for an interest payment and the relevant
interest payment date shall be surrendered without the coupon relating to such
interest payment date attached and interest will not be payable on such
interest payment date in respect of the Registered Debt Security issued in
exchange for such Bearer Debt Security, but will be payable only to the holder
of such coupon in accordance with the terms of the Senior Indenture. Unless
otherwise specified in the applicable Prospectus Supplement, Bearer Debt
Securities will not be issued in exchange for Registered Debt Securities.
(Section 2.08 of the Senior Indenture)
Debt Securities of any series may be surrendered for exchange as provided
above, and Registered Debt Securities of any series (other than a Global
Security, except as provided under "Global Securities") may be surrendered for
registration of transfer, at the office or agency designated by the Company
for such purpose with respect to such series of Debt Securities. Bearer Debt
Securities will be transferable by delivery. (Section 2.14 of the Senior
Indenture) Every Registered Debt Security presented or surrendered for
registration of transfer or for exchange shall be duly endorsed or accompanied
by appropriate transfer documents duly executed. No service charge will be
made for any registration of transfer or exchange of Debt Securities, but the
Company may require
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payment of a sum sufficient to cover any taxes and other governmental charges
that may be imposed in relation thereto. (Section 2.08 of the Indentures)
The Company and the Registrar need not transfer or exchange any Debt
Securities selected for redemption or purchase (except, in the case of Debt
Securities to be redeemed or purchased in part, the portion thereof not to be
redeemed or purchased) or any Debt Securities in respect of which a notice
requiring the purchase or redemption thereof by the Company at the option of
the holder thereof has been given and not withdrawn by such holder in
accordance with the terms of such Debt Securities (as described, if
applicable, in the Prospectus Supplement) (except, in the case of Debt
Securities to be so purchased or redeemed in part, the portion thereof not to
be so purchased or redeemed). (Section 2.08 of the Indentures) A Bearer Debt
Security so selected for redemption or purchase or in respect of which a
notice requiring the redemption or purchase thereof by the Company at the
option of the holder thereof has been given and not so withdrawn may however,
if so provided with respect to the Debt Securities of such series, be
exchanged for a Registered Debt Security of that series and like tenor,
provided that such Registered Debt Security is simultaneously surrendered for
redemption or purchase, as the case may be. (Section 2.08 of the Senior
Indenture)
The Senior Subordinated Indenture and the Subordinated Indenture also
provide that the Registrar need not transfer or exchange any Debt Securities
of a particular series during a period of 15 days before a selection of Debt
Securities of such series to be redeemed. (Section 2.08 of the Senior
Subordinated and the Subordinated Indentures) The Senior Indenture provides
that the Company shall not be required to issue, register the transfer of or
exchange Debt Securities of any series during a period beginning at the
opening of business 15 days before any selection of Debt Securities of that
series to be redeemed and ending at the close of business on (i) if Debt
Securities of that series are issuable only as Registered Debt Securities, the
date of the mailing of the relevant notice of redemption, and (ii) if Debt
Securities of that series are issuable as Bearer Debt Securities, the date of
the first publication of the relevant notice of redemption or, if Debt
Securities of that series are also issuable as Registered Debt Securities and
there is no publication, the mailing of the relevant notice of redemption.
(Section 2.08 of the Senior Indenture)
Prior to due presentment of a Registered Debt Security for registration to
transfer, the person in whose name such Registered Debt Security is registered
may be treated as the owner of it for all purposes. (Section 2.14 of the
Indentures) The bearer of any Bearer Debt Security and the bearer of any
coupon appertaining thereto may be treated as the owner of such Bearer Debt
Security or coupon for all purposes. (Section 2.14 of the Senior Indenture)
GLOBAL SECURITIES
The Indentures provide that the Debt Securities of any series thereunder may
be issued in whole or in part in the form of one or more Global Securities,
which Global Securities may be issued in registered form (or, in the case of
Senior Debt Securities, bearer form) and in either temporary or permanent
form. (Sections 2.10 and 2.11 of the Senior Indenture and Sections 2.11 and
2.15 of the Senior Subordinated and Subordinated Indentures) Each Global
Security will be deposited with and, if it is issued in registered form, will
be registered in the name of the depositary (or a nominee of the depositary)
identified in the applicable Prospectus Supplement. (Section 2.10 of the
Senior Indenture and Section 2.15 of the Senior Subordinated and Subordinated
Indentures) So long as the depositary for a Global Security in registered
form, or its nominee, is the registered owner of the Global Security, the
depositary or its nominee, as the case may be, will be considered the sole
owner of the Debt Securities represented by such Global Security for all
purposes under the Indenture. (Section 2.14 of the Indentures) Unless and
until it is exchanged in whole or in part for Debt Securities in definitive
form, a Global Security may not be transferred except as a whole by the
depositary for such Global Security to a nominee of such depositary or by a
nominee of such depositary to such depositary or another nominee of such
depositary or by the depositary or any nominee to a successor depositary or
any nominee of such successor. (Section 2.08 of the Indentures) Unless
otherwise specified in the applicable Prospectus Supplement, if the depositary
with respect to any Global Security is at any time unwilling, unable or
ineligible to continue as depositary and a successor
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depositary is not appointed by the Company within 90 days of such time, or if
the Company, in its sole discretion, at any time determines that any series of
Debt Securities issued or issuable in the form of a Global Security shall no
longer be represented by such Global Security, then in either such event the
Global Security shall be exchanged for Debt Securities in definitive form
pursuant to the applicable Indenture. Further, if so specified by the Company
with respect to the Debt Securities of a series and described in the applicable
Prospectus Supplement, an owner of a beneficial interest in a Global Security
representing Debt Securities of such series may, on terms acceptable to the
Company and the depositary for such Global Security, receive Debt Securities of
such series in definitive form. In any such instance, an owner of a beneficial
interest in a Global Security will be entitled to physical delivery in
definitive form of Debt Securities in authorized denominations and of like
tenor of the series represented by such Global Security, equal in principal
amount to such beneficial interest, and to have such Debt Securities registered
in its name (if the Debt Securities of such series are issuable as Registered
Debt Securities). (Section 2.08 of the Indentures) See, however, "Limitations
on Issuance of Bearer Debt Securities" below for a discussion of certain
restrictions on the delivery of a Bearer Debt Security in definitive form in
exchange for an interest in a Global Security. Except as described above,
unless otherwise specified in the applicable Prospectus Supplement, owners of
beneficial interests in a Global Security will not be entitled to have Debt
Securities of the series represented by such Global Security registered in
their names, will not receive or be entitled to receive physical delivery of
Debt Securities of such series in definitive form and will not be considered
the owners or holders thereof under the applicable Indenture.
Any specific terms of the depositary arrangement with respect to a series of
Debt Securities or any part thereof will be described in the applicable
Prospectus Supplement. The Company anticipates that the following provisions
will apply to all depositary arrangements.
Upon the issuance of a Global Security, the depositary will credit, on its
book-entry registration and transfer system, the respective principal amounts
of the Debt Securities represented by such Global Security to the accounts of
participants. Ownership of beneficial interests in a Global Security will be
shown on, and the transfer of that ownership will be effected only through,
records maintained by the depositary (with respect to beneficial interests of
participants in the depositary), or by participants in the depositary or
persons that may hold interest through such participants (with respect to
beneficial interests of persons other than participants in the depositary).
Ownership of beneficial interests in a Global Security will be limited to
participants or persons that hold interests through participants.
Subject to the restrictions discussed under "Limitations on Issuance of
Bearer Debt Securities" below, payments of the principal of and any premium and
interest on Debt Securities registered in the name of or held by a depositary
or its nominee will be made to the depositary or its nominee, as the case may
be, as the registered owner or the holder of the Global Security representing
such Debt Securities. None of the Company, the Trustee, any Paying Agent or the
Registrar for such Debt Securities will have any responsibility or liability
for any aspect of the records relating to or payments made on account of
beneficial ownership interests in Global Security for such debt Securities or
for maintaining, supervising or reviewing any records relating to such
beneficial ownership interests. (Section 2.14 of the Indentures)
The Company expects that the depositary for Debt Securities of a series, upon
receipt of any payment of principal, premium or interest in respect of a Global
Security, will credit immediately participants' accounts with payments in
amounts proportionate to their respective beneficial interests in the principal
amount of such Global Security as shown on the records of such depositary. The
Company also expects that payments by participants to owners of beneficial
interests in such Global Security held through such participants will be
governed by standing instructions and customary practices, as is now the case
with securities held for the accounts of customers in bearer form or registered
in "street name," and will be the responsibility of such participants. With
respect to a Global Security that represents in whole or in part Debt
Securities of a series that are issuable as Bearer Debt Securities, receipt by
owners of beneficial interests in such Global Security of payments in respect
of such Global Security will be subject to the restrictions discussed under
"Limitations on Issuance of Bearer Debt Securities" below.
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LIMITATIONS ON ISSUANCE OF BEARER DEBT SECURITIES
In compliance with United States federal tax laws and regulations, Bearer
Debt Securities (including beneficial interests in a Global Security that
represents Bearer Debt Securities) may not be offered or sold (or resold in
connection with their original issuance) during the "restricted period," as
defined in Treasury Regulations Section 1.163-5(c)(2)(i)(D)(7), in the United
States or its possessions or to United States persons (each as defined below)
other than to (i) a Qualifying Foreign Branch of a United States Financial
Institution (as defined below), (ii) a United States person who acquires and
holds the obligation through the Qualifying Foreign Branch of a United States
Financial Institution, (iii) a United States office of an "exempt
distributor," as defined in Treasury Regulation Section 1.163-
5(c)(2)(i)(D)(5), (iv) the United States office of an international
organization, as defined in Section 7701(a)(18) of the Internal Revenue Code
of 1986, as amended (the "Code") and the regulations thereunder, or (v) the
United States office of a foreign central bank, as defined in Section 895 of
the code and the regulations thereunder. In addition, Bearer Debt Securities
may not be delivered within the United States or its possessions in connection
with a sale that occurred during the restricted period. Any underwriters,
agents and dealers participating in the offering of Offered Securities must
agree that they will not offer any Bearer Debt Securities for sale or resale
in the United States or its possessions or the United States persons (other
than a person specified in clause (i), (ii), (iii), (iv) or (v) above) or
deliver Bearer Debt Securities within the United States or its possessions.
The term "Qualifying Foreign Branch of a United States Financial Institution"
means a branch located outside the United States of a United States financial
institution (as defined in Treasury Regulation Section 1.165-12(c)(1)(v)) that
provides a certificate within a reasonable time (or a blanket certificate in
the year the Debt Security is issued or either of the preceding two calendar
years) stating that it agrees to comply with the requirements of Section
165(j)(3)(A), (B) or (C) of the Code and the regulations thereunder. The term
"United States person" means a citizen or resident of the United States, a
corporation, partnership or other entity created or organized in or under the
laws of the United States or any political subdivision thereof and an estate
or trust the income of which is subject to United States federal income
taxation regardless of its source; the term "United States" means the United
States of America (including the States and the District of Columbia), and the
term "possessions" includes, but is not limited to, Puerto Rico, the U.S.
Virgin Islands, Guam, American Samoa, Wake Island and the Northern Mariana
Islands.
United States federal tax laws and regulations also require that the owner
of an obligation issuable in bearer form or the financial institution (as
defined in the preceding paragraph) or clearing organization through which the
owner directly or indirectly holds such obligation must provide the issuer of
the obligation with a certificate on the earlier of the date of the first
actual payment of interest on the obligation or the date of delivery by the
issuer of the obligation in definitive form stating that on such date the
obligation is owned by (a) a person that is not a United States person, (b) a
person described in clause (i) or (ii) of the preceding paragraph, or (c) a
financial institution for purposes of resale during the restricted period, but
not for resale directly or indirectly to a United States person or to a person
within the United States or its possessions. A certificate described in clause
(a) or (b) above may not be given with respect to an obligation that is owned
by a financial institution for purposes of resale during the restricted
period. When the required certificate is provided by a clearing organization,
the certificate must be based upon statements provided to it by its member
organizations. For purposes of the foregoing, a "temporary global security,"
as defined in Treasury Regulation Section 1.163-5(c)(1)(ii)(B), is not
considered to be an obligation in definitive form. In compliance with the
foregoing, if the Offered Securities are of a series of Debt Securities
issuable as Bearer Debt Securities, the delivery thereof (including delivery
in exchange for an interest in a Global Security) and the payment of interest
thereon, as applicable, will be subject to the satisfaction of certification
requirements that will be specified by the Company in accordance with the
Senior Indenture in connection with the establishment of such series and will
be described in the applicable Prospectus Supplement. (Sections 2.02 and 2.04
of the senior Indenture) The Senior Indenture also provides that no Bearer
Debt Security (including a Global Security that represents Bearer Debt
Securities) will be mailed or otherwise delivered to any location in the
United States or its possessions. (Section 2.04 of the Senior Indenture)
Bearer Debt Securities and any coupons appertaining thereto will bear a
legend substantially to the following effect: "Any United States person who
holds this obligation will be subject to limitations under the United States
income tax laws, including the limitations provided in Sections 165(j) and
1287(a) of the Internal
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Revenue Code." Under Sections 165(j) and 1287(a) of the Code, holders that are
United States persons, with certain exceptions, will not be entitled to deduct
any loss on Bearer Debt Securities and must treat as ordinary income any gain
realized on the sale or other disposition (including the receipt of principal)
of Bearer Debt Securities.
PAYMENT
Unless otherwise indicated in an applicable Prospectus Supplement, payment
of principal of and any premium and interest on Bearer Debt Securities (other
than a Global Security) will be made, subject to any applicable laws and
regulations, at the offices of such paying Agent or paying Agents outside the
United States as the Company may designate from time to time, except that, at
the option of the company (or, if so specified in the applicable Prospectus
Supplement, at the option of the holder), payment of interest may be made by
check (provided the same is not mailed to an address inside the United States)
or by wire transfer to an account located outside the United States maintained
by the payee. (Sections 2.13 and 4.01 of the Senior Indenture) Unless
otherwise indicated in an applicable Prospectus Supplement, payment of
interest on Bearer Debt Securities on any interest payment date will be made
only against surrender of the coupon relating to such interest payment date.
(Section 2.13 of the Senior Indenture) No payment with respect to any Bearer
Debt Security will be made at any office or agency of the Company in the
United States or by check mailed to any address in the United States or by
transfer to an account maintained in the United States. Notwithstanding the
foregoing, payments of principal of and any premium and interest on Bearer
Debt Securities denominated and payable in U.S. Dollars will be made at the
office of the Company's Paying Agent in the Borough of Manhattan, The City of
New York, if (but only if) payment of the full amount thereof in U.S. Dollars
at all offices or agencies outside the United States is illegal or effectively
precluded by exchange controls or other similar restrictions. (Section 4.01 of
the Senior Indenture)
Unless otherwise indicated in an applicable Prospectus Supplement, payment
of principal of and any premium and interest on Registered Debt Securities
(other than a Global Security) will be made at the office of such Paying Agent
or paying Agents as the Company may designate from time to time, except that
at the option of the Company payment of any interest may be made by check
mailed to the address of the person entitled thereto as such address shall
appear in the security register or, if so specified with respect to the
Registered Debt Securities of any series issued under the Senior indenture, by
wire transfer to an account designated by such person. Payment of any
installment of interest on Registered Debt Securities will be made to the
person in whose name such Registered Debt Security is registered at the close
of business on the regular record date (or, in the case of defaulted interest,
special record date) for such interest payment. (Section 2.13 of the
Indentures)
All moneys paid by the Company to a Paying Agent for the payment of
principal of or any premium or interest on any Debt Security which remain
unclaimed at the end of two years after such principal, premium or interest
shall have become due and payable will be repaid to the Company and the holder
of such Debt Security or any coupon appertaining thereto will thereafter look
only to the Company for payment thereof unless an applicable abandoned
property law designates another person. (Section 8.03 of the Indentures)
AMENDMENT, SUPPLEMENT, WAIVER
Subject to certain exceptions, the Indentures or the Debt Securities may be
amended or supplemented, and any past default or compliance with any provision
may be waived, insofar as the Debt Securities of any series are concerned,
with the consent of the holders of a majority in aggregate principal amount of
the outstanding Debt Securities of such series. (Sections 6.04 and 9.02 of the
Indentures) Without the consent of any holder of Debt Securities, the Company
and the Trustee may amend or supplement the Indentures or the Debt Securities
to cure any ambiguity, defect or inconsistency, to permit or facilitate the
issuance of Debt Securities in bearer form or to provide for uncertificated
Debt Securities in global form in addition to certificated Debt Securities (so
long as any "registration-required obligation," within the meaning of Section
163(f)(2) of the Code, is in registered form for purposes of the Code) or to
make certain other specified changes or any change that does not materially
adversely affect the rights of any holder of Debt Securities. (Section 9.01 of
the Indentures)
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SUCCESSOR CORPORATION
The Company may not consolidate with or merge into, or transfer its
properties and assets substantially as an entirety to, another corporation
unless (i) the successor corporation, which shall be a corporation organized
under the laws of the United States or a State thereof, assumes by
supplemental indenture all the obligations of the Company under the Debt
Securities and the Indentures, and (ii) after giving effect to such
transaction, no Event of Default shall have occurred and be continuing.
Thereafter, unless otherwise specified in the Prospectus Supplement, all such
obligations of the Company terminate. (Section 5.01 of the Indentures)
DEFAULTS AND REMEDIES
An Event of Default with respect to Debt Securities of any series is: (i)
default for 30 days in payment of any interest on the Debt Securities of that
series; (ii) default in payment of principal, premium or any other amount
(other than interest) due in respect of the Debt Securities of that series at
maturity, upon redemption (including default in the making of any mandatory
sinking fund payment), upon purchase by the Company at the option of the
holder or otherwise; (iii) failure by the Company for 30 days after receipt of
written notice as provided in the Indentures to comply with any of its other
agreements in the Indentures (other than agreements expressly included in the
Indentures solely for the benefit of a series of Debt Securities other than
that series or expressly made inapplicable to the Debt Securities of such
series) or the Debt Securities of that series; (iv) (for purposes of the
Senior Indenture only) acceleration of the maturity of any Debt of the Company
(including Senior Debt Securities of any other series) if the aggregate
principal amount (or, if applicable, issue price plus accrued original issue
discount) of the Debt the maturity of which has been accelerated exceeds five
percent (5%) of the aggregate principal amount of the Company's Funded Debt
then outstanding and such Debt is not paid, or such acceleration is not
rescinded or annulled or such acceleration is not contested by appropriate
proceedings and all consequences thereof that would have a material adverse
effect on the Company stayed, within 30 days after receipt of written notice
as provided in the Senior Indenture; provided, however, that if, after the
expiration of such 30-day period, the event of default that resulted in the
acceleration of the maturity of such Debt of the Company is remedied or cured
by the Company or waived by the holders of such Debt in any authorized manner
or otherwise ceases to exist, then the Event of Default described in this
clause (iv) resulting from such acceleration will be deemed cured and not
continuing; and (v) certain events of bankruptcy or insolvency. (Section 6.01
of the Indentures) If an Event of Default occurs with respect to the Debt
Securities of any series and is continuing, the Trustee or the holders of at
least 25% in aggregate principal amount of the Debt Securities of that series
may declare to be due and payable immediately (i) the principal amount of that
series (or, if the Debt Securities of that series are Original Issue Discount
Securities, that portion of the principal amount specified in the terms of
that series) and (ii) accrued interest, if any, thereon. The Indentures
provide for automatic acceleration of the maturity of such amounts upon the
occurrence of certain events of bankruptcy or insolvency. (Section 6.02 of the
Indentures) The Senior Indenture provides that a declaration of acceleration
of the maturity of the Senior Debt Securities of any series as a result of an
Event of Default described in clause (iv) above will be automatically annulled
if (x) the acceleration of the Debt that is the subject of such Event of
Default is declared void ab initio as a result of the Company's contest
thereof or (y) the declaration of acceleration of such Debt is rescinded or
annulled in any manner authorized by the instrument evidencing or creating
such Debt within 90 days of the declaration of acceleration of the Senior Debt
Securities of such series and, in the case of clause (y), the annulment of the
declaration of acceleration under the Senior Indenture would not conflict with
any judgment or decree, and, in the case of either clause (x) or (y), all
other existing Events of Default (other than the non-payment of amounts that
have become due with respect to such Senior Debt Securities solely by such
acceleration) with respect to Senior Debt Securities of that series have been
cured or waived. (Section 6.02 of the Senior Indenture) Holders of Debt
Securities may not enforce the Indentures or the Debt Securities except as
provided in the Indentures. (Section 6.06 of the Indentures) The Trustee may
require indemnity satisfactory to it before it enforces the Indenture or the
Debt Securities. (Section 7.01 of the Indentures) Subject to certain
limitations, holders of a majority in aggregate principal amount of the Debt
Securities of any series may direct the Trustee in its exercise of any trust
or power with respect to the Debt Securities of that series. (Section 6.05 of
the Indentures) The Trustee may withhold from holders of Debt Securities
notice of any continuing default (except a default in payment of principal,
premium, if any, interest or other amounts due) if it determines that
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withholding notice is in their interest. (Section 7.05 of the Indentures) The
Company is required to file periodic reports with the Trustee as to the
absence of default. (Section 4.07 of the Senior Indenture and Section 4.03 of
the Senior Subordinated and Subordinated Indentures)
NO PERSONAL LIABILITY
No past, present or future director, officer, employee or stockholder, as
such, of the Company or any successor hereof shall have any liability for any
obligations of the Company under the Debt Securities or the Indentures or for
any claim based on, in respect of, or by reason of, such obligations or their
creation. Each holder of Debt Securities by accepting a Debt Security waives
and releases all such liability. The waiver and release are part of the
consideration for the issue of the Debt Securities. (Section 11.11 of the
Senior Indenture and Section 12.11 of the Senior Subordinated and Subordinated
Indentures)
SATISFACTION AND DISCHARGE
The Company's obligations under the Debt Securities of any series and the
applicable Indenture with respect to such series (except for the obligation to
pay the principal of and premium and interest, if any, on the Debt Securities
of such series and certain other specified obligations) will be satisfied and
discharged in accordance with the provisions of the Indenture if either (i)
all Debt Securities of such series and coupons, if any, appertaining thereto
previously authenticated and delivered (other than destroyed, lost or
wrongfully-taken Debt Securities or coupons which have been replaced or paid,
Debt Securities or coupons for whose payment money has theretofore been held
in trust and, after remaining unclaimed for two years, has been repaid to the
Company, and certain coupons appertaining to Bearer Securities surrendered for
exchange, redemption or purchase) have been delivered to the Trustee for
cancellation or (ii) the company irrevocable deposits in trust with the
Trustee money or U.S. Government Obligations (or, in the case of the Senior
Indenture, Government Obligations) sufficient to pay the principal of and
premium and interest, if any, on all Debt Securities of such series and
coupons, if any, appertaining thereto not theretofore cancelled or delivered
to the Trustee for cancellation (other than Debt Securities and coupons
referred to in the parenthetical in clause (i) above) to maturity or
redemption, as the case may be. (Section 2.01 of the Indentures)
THE TRUSTEES
The Bank of New York acts as depositary for funds of, makes loans to, and
performs other services for the Company and certain of its affiliates in the
normal course of business and acts as trustee with respect to certain
outstanding senior indebtedness of the Company. The Bank of New York serves as
transfer agent and registrar for each series of the Parent's common stock and
for the Parent's Class B 6% Cumulative Redeemable Exchangeable Junior
preferred Stock. John C. Malone, a director of the Company, is a director of
The Bank of New York.
Information with respect to the Trustees under the Senior Subordinated
Indenture and the Subordinated Indenture shall be provided in the applicable
Prospectus Supplement.
Any Trustee in its individual or any other capacity may become the owner or
pledgee of Debt Securities and may otherwise deal with the Company or its
Affiliates with the same rights it would have if it were not the Trustee
provided it complies with the terms of the Indenture. (Section 7.03 of the
Indentures)
ADDITIONAL INFORMATION
The Indentures (or form thereof, as the case may be) are exhibits to the
Registration Statement. Anyone who receives this Prospectus may obtain copies
of the Indentures (or form thereof, as the case may be) without charge by
writing to Stephen M. Brett, Esq., Senior Vice President of the Company, at
the address set forth under "The Company." The foregoing summaries of certain
provisions of the Indentures do not purport to be complete and are subject to,
and qualified in their entirety by reference to, all provisions of the
Indentures, including the definitions of certain terms. Wherever particular
provisions or defined terms of the Indentures are referred to, such provisions
or defined terms are incorporated herein by reference.
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PLAN OF DISTRIBUTION
The Company may sell the Offered Securities on a negotiated or competitive
bid basis to or through underwriters or dealers, and also may sell the Offered
Securities directly to other purchasers or through agents.
The distribution of the Offered Securities may be effected from time to time
in one or more transactions at a fixed price or prices, which may be changed,
or at market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices.
If Offered Securities are offered on a competitive bid basis, the Company
will receive bids by telephone or otherwise prior to a designated time. Each
bid will be required to be made for all Offered Securities and the Company
will reserve the right to reject all bids. If any bid is accepted, the Company
will accept the qualified bid which in its sole and final determination will
result in the lowest annual cost of money to it for the Offered Securities. No
underwriter will be entitled to submit or participate as a bidder in more than
one bid.
If an underwriter or underwriters are utilized in the sale, the Company will
execute an underwriting agreement with such underwriters and the names of the
underwriters and the terms of the transaction will be set forth in the
Prospectus Supplement, which will be used by the underwriters to make resales
of the Offered Securities. Unless otherwise indicated in the Prospectus
Supplement, the obligations of any underwriters to purchase the Offered
Securities will be subject to certain conditions precedent and the
underwriters will be obligated to purchase all of the Offered Securities if
any are purchased.
If a dealer is utilized in the sale, the Company will sell the Offered
Securities to the dealer as principal. The dealer may then resell the Offered
Securities to the public at varying prices to be determined by such dealer at
the time of resale.
Offers to purchase Offered Securities may be solicited by the Company or
agents designated by the Company from time to time. Unless otherwise indicated
in the Prospectus Supplement, any such agent will be acting on a best efforts
basis for the period of its appointment.
Each underwriter, dealer and agent participating in the distribution of any
Offered Securities which are issuable in bearer form will agree that it will
not, directly or indirectly, offer any Offered Securities in bearer form for
sale or resale in the United States or its possessions or to United States
persons (subject to certain exceptions) or deliver any Offered Securities in
bearer form within the United States or its possessions. See "Description of
Debt Securities--Limitations on Issuance of Bearer Debt Securities."
In connection with the sale of the Offered Securities, underwriters, dealers
and agents may receive compensation in the form of discounts, concessions or
commissions from the Company or from purchasers of the Offered Securities for
whom they may act as agents. Underwriters, dealers and agents that participate
in the distribution of the Offered Securities may be deemed to be underwriters
as that term is defined in the Securities Act, and any discounts or
commissions received by them from the Company and any profits on the resale of
the Offered Securities by them may be deemed to be underwriting discounts and
commissions under the Securities Act. Any such person who may be deemed to be
an underwriter will be identified and any such compensation received from the
Company will be described in the Prospectus Supplement.
If so indicated in the Prospectus Supplement, the Company will authorize
agents and underwriters to solicit offers by certain specified institutions to
purchase Offered Securities from the Company at the public offering price set
forth in the Prospectus Supplement pursuant to delayed delivery contracts
providing for payment and delivery on a specified date in the future.
Institutions with whom such contracts, when authorized, may be made include
commercial and savings banks, insurance companies, pension funds, investment
companies, educational and charitable institutions and other institutions but
shall in all cases be subject to the approval of the Company. Such contracts
will be subject only to those conditions set forth in the Prospectus
Supplement and the Prospectus Supplement will set forth the commission payable
for solicitation of such contracts.
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Agents, underwriters and dealers may be entitled under agreements entered
into with the Company to indemnification by the Company against certain civil
liabilities, including liabilities under the Securities Act, or to
contribution with respect to payments which the agents, underwriters or
dealers may be required to make
in respect thereof. Agents, underwriters and dealers may be customers of,
engage in transactions with, or perform services for the Company in the
ordinary course of business.
The anticipated place and time of delivery for the Offered Securities will
be set forth in the Prospectus Supplement.
LEGAL MATTERS
Certain legal matters with respect to the Debt Securities, the Series A TCI
Group Common Stock and the Guarantees, if any, offered hereby will be passed
upon for the Company and the Parent by Baker & Botts, L.L.P., 885 Third
Avenue, New York, New York 10022-4834. Jerome H. Kern, a partner of Baker &
Botts, L.L.P. is a director of Tele-Communications, Inc. Mr. Kern holds
options to purchase shares of Series A TCI Group Common Stock and Series A
Liberty Media Group Common Stock issued by the Parent.
EXPERTS
The consolidated balance sheets of Tele-Communications, Inc. and
subsidiaries as of December 31, 1994 and 1993, and the related consolidated
statements of operations, stockholders' equity, and cash flows for each of the
years in the three year period ended December 31, 1994, and the related
financial statement schedules, which appear in Tele-Communications, Inc.'s
Annual Report on Form 10-K for the year ended December 31, 1994, as amended,
have been incorporated by reference herein in reliance upon the reports, dated
March 27, 1995, of KPMG Peat Marwick LLP, independent certified public
accountants, incorporated by reference herein, and upon the authority of said
firm as experts in accounting and auditing. The reports of KPMG Peat Marwick
LLP covering the December 31, 1994 consolidated financial statements refer to
the adoption of Statement of Financial Accounting Standards No. 115,
"Accounting for Investments in Certain Debt and Equity Securities," in 1994.
The consolidated balance sheets of TCI Communications, Inc. (formerly Tele-
Communications, Inc.) and subsidiaries as of December 31, 1994 and 1993, and
the related consolidated statements of operations, stockholder's(s') equity,
and cash flows for each of the years in the three year period ended December
31, 1994, and the related financial statement schedules, which appear in TCI
Communications, Inc.'s Annual Report on Form 10-K for the year ended December
31, 1994, as amended, have been incorporated by reference herein in reliance
upon the reports, dated March 27, 1995, of KPMG Peat Marwick LLP, independent
certified public accountants, incorporated by reference herein, and upon the
authority of said firm as experts in accounting and auditing. The reports of
KPMG Peat Marwick LLP covering the December 31, 1994 consolidated financial
statements refer to the adoption of Statement of Financial Standards No. 115,
"Accounting for Investments in Certain Debt and Equity Securities," in 1994.
The consolidated balance sheets of TeleWest Communications plc and
subsidiaries as of 31 December 1994 and 1993, and the related consolidated
statements of operations and cash flows for each of the years in the three-
year period ended 31 December 1994, which appear in 31 December 1994 Annual
Report on Form 10-K of Tele-Communications, Inc., as amended, have been
incorporated by reference herein in reliance upon the report of KPMG,
independent certified public accountants, incorporated by reference herein,
and upon the authority of said firm as experts in accounting and auditing.
The combined balance sheets of Cablevision (a combination of certain cable
television assets of Cablevision S.A., Televisora Balgrano S.A., Construred
S.A. and Univent's S.A.) as of December 31, 1994 and 1993, and the related
combined statements of operations and deficit and cash flows for each of the
years in the three-year period ended December 31, 1994, which appear in the
Current Report on Form 8-K of Tele-Communications, Inc. dated April 20, 1995,
as amended, have been incorporated by reference herein in reliance upon the
report of KPMG Finsterbusch Pickenhavn Sibille, independent certified public
accountants, incorporated by reference herein, and upon the authority of said
firm as experts in accounting and auditing.
25
<PAGE>
The consolidated balance sheets of QVC, Inc. and subsidiaries as of January
31, 1994 and 1993, and the related consolidated statements of operations,
shareholders' equity and cash flows for each of the years in the three-year
period ended January 31, 1994, which appear in the Current Report on Form 8-K
of Tele-Communications, Inc. dated February 3, 1995, as amended, have been
incorporated by reference herein in reliance upon the report of KPMG Peat
Marwick LLP, independent certified public accountants, incorporated by
reference herein, and upon the authority of said firm as experts in accounting
and auditing. The report of KPMG Peat Marwick LLP covering the January 31,
1994 consolidated financial statements refers to a change in the method of
accounting for income taxes.
The financial statements of TeleCable Corporation as of December 31, 1993
and 1992 and for each of the two years in the period ended December 31, 1993
incorporated in this Prospectus by reference to the Company's and TCI's
Current Report on Form 8-K dated August 26, 1994, have been so incorporated in
reliance on the report of Price Waterhouse LLP, independent accountants, given
on the authority of said firm as experts in auditing and accounting.
26
<PAGE>
================================================================================
NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY IN-
FORMATION OR TO MAKE ANY REPRESENTATION OTHER THAN THOSE CONTAINED IN THIS PRO-
SPECTUS SUPPLEMENT, THE PROSPECTUS OR ANY PRICING SUPPLEMENT IN CONNECTION WITH
THE OFFER MADE BY THIS PROSPECTUS SUPPLEMENT, THE PROSPECTUS OR ANY PRICING
SUPPLEMENT AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR ANY AGENT. THIS PRO-
SPECTUS SUPPLEMENT, THE PROSPECTUS AND ANY PRICING SUPPLEMENT DO NOT CONSTITUTE
AN OFFER TO SELL OR A SOLICITATION BY ANYONE IN ANY STATE IN WHICH SUCH OFFER
OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR
SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO
MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS SUP-
PLEMENT, THE PROSPECTUS OR ANY PRICING SUPPLEMENT NOR ANY SALE MADE HEREUNDER
OR THEREUNDER SHALL UNDER ANY CIRCUMSTANCES CREATE ANY IMPLICATION THAT THE IN-
FORMATION HEREIN OR IN THE PROSPECTUS OR ANY PRICING SUPPLEMENT IS CORRECT AS
OF ANY TIME SUBSEQUENT TO THE DATE HEREOF OR THEREOF OR THAT THERE HAS BEEN NO
CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THEREOF.
---------------
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Description of Notes....................................................... S-2
Book-Entry System.......................................................... S-16
Certain United States Tax Considerations................................... S-17
Plan of Distribution....................................................... S-23
PROSPECTUS
Available Information...................................................... 2
Incorporation of Documents by Reference.................................... 2
The Company and TCI........................................................ 4
Use of Proceeds............................................................ 4
Ratio of Earnings to Fixed Charges......................................... 4
Description of Debt Securities............................................. 5
Plan of Distribution....................................................... 24
Legal Matters.............................................................. 25
Experts.................................................................... 25
</TABLE>
================================================================================
================================================================================
TCI COMMUNICATIONS, INC.
$750,000,000
MEDIUM-TERM NOTES, SERIES C
DUE NINE MONTHS OR
MORE FROM DATE OF ISSUE
----------------------
PROSPECTUS SUPPLEMENT
----------------------
MERRILL LYNCH & CO.
CS FIRST BOSTON
LEHMAN BROTHERS
SALOMON BROTHERS INC
, 1995
================================================================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCES AND DISTRIBUTION.
The aggregate estimated expenses, other than underwriting discounts and
commissions, in connection with all offerings pursuant to this Registration
Statement are currently anticipated to be as follows:
<TABLE>
<S> <C>
Registration Fee............................................ $1,034,482.76
Blue Sky Fees and Expenses (including counsel fees)......... 20,000
Printing and Engraving Expenses............................. 100,000
Legal Fees and Expenses..................................... 200,000
Accounting Fees and Expenses................................ 75,000
Fees of Indenture Trustee................................... 45,000
Rating Agency Fees.......................................... 270,000
Miscellaneous............................................... 55,517.24
-------------
Total................................................... $ 1,800,000
=============
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law provides, generally,
that a corporation shall have the power to indemnify any person who was or is
a party or is threatened to be made a party to any action, suit or proceeding
(except actions by or in the right of the corporation) by reason of the fact
that such person is or was a director or officer of the corporation against
all expenses, judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit or proceeding
if he acted in good faith and in a manner he reasonably believed to be in or
not opposed to the best interest of the corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe his conduct
was unlawful. A corporation may similarly indemnify such person for expenses
actually and reasonably incurred by him in connection with the defense or
settlement of any action or suit by or in the right of the corporation,
provided such person acted in good faith and in a manner be reasonably
believed to be in or not opposed to the best interests of the corporation,
and, in the case of claims, issues and matters as to which such person shall
have been adjudged liable to the corporation, provided that a court shall have
determined, upon application, that, despite the adjudication of liability but
in view of all of the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses which such court shall deem
proper.
Section 102(b)(7) of the Delaware General Corporation Law provides,
generally, that the certificate of incorporation may contain a provision
eliminating or limiting the personal liability of a director to the
corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, provided that such provision may not eliminate or limit
the liability of a director (i) for any breach of the director's duty of
loyalty to the corporation or its stockholders, (ii) for acts or omissions not
in good faith or which involve intentional misconduct or a knowing violation
of law, (iii) under section 174 of Title 8, or (iv) for any transaction from
which the director derived an improper personal benefit. No such provision may
eliminate or limit the liability of a director for any act or omission
occurring prior to the date when such provision becomes effective.
Articles SEVENTH and EIGHTH of the Company's Restated Certificate of
Incorporation provide as follows:
"SEVENTH. Any person who was or is a party or is threatened to be made a
party to any threatened, pending, or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (whether or not by
or in the right of the corporation) by reason of the fact that he is or was
a director, officer, incorporator, employee, or agent of the Corporation,
or is or was serving at the request of the Corporation as a director,
officer, incorporator, employee, partner, trustee, or agent of another
corporation, partnership, joint venture, trust, or other enterprise
(including an employee benefit plan), shall be entitled to
II-1
<PAGE>
be indemnified by the Corporation to the full extent then permitted by law
against expenses (including attorneys' fees), judgments, fines (including
excise taxes assessed on a person with respect to an employee benefit
plan), and amounts paid in settlement incurred by him in connection with
such action, suit, or proceeding. Such right of indemnification shall inure
whether or not the claim asserted is based on matters which antedate the
adoption of this Article SEVENTH. Such right of indemnification shall
continue as to a person who has ceased to be a director, officer,
incorporator, employee, partner, trustee, or agent and shall inure to the
benefit of the heirs and personal representatives of such a person. The
indemnification provided by this Article SEVENTH shall not be deemed
exclusive of any other rights which may be provided now or in the future
under any provision currently in effect or hereafter adopted of the bylaws,
by any agreement, by vote of stockholders, by resolution of disinterested
directors, by provision of law, or otherwise.
EIGHTH. No director of the Corporation shall be liable to the Corporation
or any of its stockholders for monetary damages for breach of fiduciary
duty as a director, except for liability (i) for any breach of the
director's duty of loyalty to the Corporation or its stockholders, (ii) for
acts or omissions not in good faith or which involve intentional misconduct
or a knowing violation of law, (iii) under Section 174 of the Delaware
General Corporation Law, or (iv) for any transaction from which the
director derived an improper personal benefit."
Article V, Section E of the Parent's Restated Certificate of
Incorporation provides as follows:
"1. Limitation on Liability.
To the fullest extent permitted by the Delaware General Corporation
Law as the same exists or may hereafter be amended, a director of the
Corporation shall not be liable to the Corporation or any of its
stockholders for monetary damages for breach of fiduciary duty as a
director. Any repeal or modification of this paragraph 1 shall be
prospective only and shall not adversely affect any limitation, right
or protection of a director of the Corporation existing at the time of
such repeal or modification.
2. Indemnification.
(a) RIGHT TO INDEMNIFICATION. The Corporation shall indemnify and
hold harmless, to the fullest extent permitted by applicable law as it
presently exists or may hereafter be amended, any person who was or is
made or is threatened to be made a party or is otherwise involved in
any action, suit or proceeding, whether civil, criminal, administrative
or investigative (a "proceeding") by reason of the fact that he, or a
person for whom he is the legal representative, is or was a director or
officer of the Corporation or is or was serving at the request of the
Corporation as a director, officer, employee or agent of another
corporation or of a partnership, joint venture, trust, enterprise or
nonprofit entity, including service with respect to employee benefit
plans, against all liability and loss suffered and expenses (including
attorneys' fees) reasonably incurred by such person. Such right of
indemnification shall inure whether or not the claim asserted is based
on matters which antedate the adoption of this Section E. The
Corporation shall be required to indemnify a person in connection with
a proceeding (or part thereof) initiated by such person only if the
proceeding (or part thereof) was authorized by the Board of Directors
of the Corporation.
(b) PREPAYMENT OF EXPENSES. The Corporation shall pay the expenses
(including attorneys' fees) incurred in defending any proceeding in
advance of its final disposition, provided, however, that the payment
of expenses incurred by a director or officer in advance of the final
disposition of the proceeding shall be made only upon receipt of an
undertaking by the director or officer to repay all amounts advanced if
it should be ultimately determined that the director or officer is not
entitled to be indemnified under this paragraph or otherwise.
(c) CLAIMS. If a claim for indemnification or payment of expenses
under this paragraph is not paid in full within 60 days after a written
claim therefor has been received by the Corporation, the claimant may
file suit to recover the unpaid amount of such claim and, if successful
in whole or in part, shall be entitled to be paid the expense of
prosecuting such claim. In any such action the Corporation shall have
the burden of proving that the claimant was not entitled to the
requested indemnification or payment of expenses under applicable law.
II-2
<PAGE>
(d) NON-EXCLUSIVITY OF RIGHTS. The rights conferred on any person by
this paragraph shall not be exclusive of any other right which such
person may [have] or hereafter acquire under any statute, provision of
this Certificate the Bylaws, agreement, vote of stockholders or
disinterested directors or otherwise.
(e) OTHER INDEMNIFICATION. The Corporation's obligation, if any, to
indemnify any person who was or is serving at its request as a
director, officer, employee or agent of another corporation,
partnership, joint venture, trust, enterprise or nonprofit entity shall
be reduced by any amount such person may collect as indemnification
from such other corporation, partnership, joint venture, trust,
enterprise or nonprofit entity.
3. Amendment or Repeal.
Any repeal or modification of the foregoing provisions of this Section
shall not adversely affect any right or protection hereunder or any
person in respect of any act or omission occurring prior to the time of
such repeal or modification."
Article II, Section 2.9 of the Parent's Bylaws also contains an indemnity
provision, requiring the Parent to indemnify members of the Board of Directors
and officers of the Parent and their respective heirs, personal
representatives and successors in interest for or on account of any action
performed on behalf of the Corporation, to the fullest extent provided by the
laws of the State of Delaware and the Parent's Certificate of Incorporation,
as then or thereafter in effect.
The Parent has also entered into indemnification agreements with each of its
directors (each director, an "indemnitee"). The indemnification agreements
provide (i) for the prompt indemnification to the fullest extent permitted by
law against any and all expenses, including attorneys' fees and all other
costs, expenses and obligations paid or incurred in connection with
investigating, defending, being a witness or participating in (including on
appeal), or in preparing for ("Expenses"), any threatened, pending or
completed action, suit or proceeding, or any inquiry or investigation
("Claim"), related to the fact that such indemnitee is or was a director,
officer, employee, agent or fiduciary of the Parent or is or was serving at
the Parent's request as a director, officer, employee, trustee, agent or
fiduciary of another corporation, partnership, joint venture, employee benefit
plan, trust or other enterprise, or by reason of anything done or not done by
a director or officer in any such capacity, and against any and all judgments,
fines, penalties and amounts paid in settlement (including all interest,
assessments and other charges paid or payable in connection therewith) of any
Claim, unless the Reviewing Party (one or more members of the Board of
Directors or other person appointed by the Board of Directors, who is not a
party to the particular claim, or independent legal counsel) determines that
such indemnification is not permitted under applicable law and (ii) for the
prompt advancement of Expenses, and for reimbursement to the Parent if the
Reviewing Party determines that such indemnitee is not entitled to such
indemnification under applicable law. In addition, the indemnification
agreements provide (i) a mechanism through which an indemnitee may seek court
relief in the event the Reviewing Part determines that the indemnitee would
not be permitted to be indemnified under applicable law (and therefore is not
entitled to indemnification or expense advancement under the indemnification
agreement) and (ii) indemnification against all expenses (including attorneys'
fees), and advancement thereof if requested, incurred by the indemnitee in
seeking to collect an indemnity claim or advancement of expenses from the
Parent or incurred in seeking to recover under a directors' and officers'
liability insurance policy, regardless of whether successful or not.
Furthermore, the indemnification agreements provide that after there has been
a "change in control" of the Parent (as defined in the indemnification
agreements), other than a change in control approved by a majority of
directors who were directors prior to such change, then, with respect to all
determinations regarding a right to indemnify and the right to advancement of
Expenses. The Parent will seek legal advice only from independent legal
counsel selected by the indemnitee and approved by the Parent.
The indemnification agreements impose upon the Parent the burden of proving
that an indemnitee is not entitled to indemnification in any particular case
and negate certain presumptions that may otherwise be drawn against an
indemnitee seeking indemnification in connection with the termination of
actions in certain circumstances. Indemnitees' rights under the
indemnification agreements are not exclusive of any other rights
II-3
<PAGE>
they may have under Delaware law, the Parent's Bylaws or otherwise. Although
not requiring the maintenance of directors' and officers' liability insurance,
the indemnification agreements require that indemnitees be provided with the
maximum coverage available for any Parent director or officer if there is such
a policy.
The Company and the Parent may purchase liability insurance policies covering
its directors and officers.
In addition, pursuant to Section 6 of the form of Underwriting Agreement, the
Underwriter or Underwriters will agree, and pursuant to Section 9 of the form
of Distribution Agreement, the Agent or Agents will agree, to indemnify and
hold harmless the Company, its directors and officers and each person, if any,
who controls the Company within the meaning of the Securities Act of 1933, as
amended, against certain civil liabilities including civil liabilities under
the Securities Act.
ITEM 16. EXHIBITS.
<TABLE>
<C> <S>
1.1 Form of Underwriting Agreement.
1.2 Form of Distribution Agreement.
4.1 Form of Senior Indenture between the Registrant and The Bank of New York,
as Trustee, as amended.
4.2 Form of Senior Subordinated Indenture.
4.3 Form of Subordinated Indenture.
4.4 Form of Fixed Rate Medium-Term Note Series C.
4.5 Form of Floating Rate Medium-Term Note Series C.
4.6 Restated Certificate of Incorporation of the Company dated as of August
4, 1994. (Incorporated herein by reference to Exhibit 3.3 of the
Company's Annual Report on Form 10-K for the year ended December 31,
1994, as amended by Form 10-K/A (Amendment No. 1) (Commission File No.
0-5550)).
4.7 Restated Certificate of Incorporation of the Parent dated August 4, 1994,
as amended on August 4, 1994, August 16, 1994, October 11, 1994, October
21, 1994, January 26, 1995, August 3, 1995 and August 3, 1995.
(Incorporated herein by reference to Exhibit 99.1 of the Parent's
Current Report on Form 8-K, dated August 10, 1995 (Commission File No.
0-20421)).
4.8 Bylaws of the Company as adopted August 4, 1994 (Incorporated herein by
reference to Exhibit 3.4 of the Company's Annual Report on Form 10-K for
the year ended December 31, 1994, as amended by Form 10-K/A (Amendment
No. 1) (Commission File No. 0-5550)).
4.9 Bylaws of the Parent as adopted June 16, 1994 (Incorporated herein by
reference to Exhibit 3.2 of the Parent's Annual Report on Form 10-K for
the year ended December 31, 1994, as amended by Form 10-K/A (Amendment
No. 1) (Commission File No. 0-20421)).
5 Opinion of Baker & Botts, L.L.P. regarding the legality of the securities
being registered.
8 Opinion of Baker & Botts, L.L.P. regarding certain tax matters.
12 Calculation of Ratios of Earnings to fixed Charges of the Company.
23.1 Consent of KPMG Peat Marwick LLP.
23.2 Consent of KPMG Peat Marwick LLP.
23.3 Consent of KPMG.
23.4 Consent of KPMG Finsterbusch Pickenhayn Sibille.
23.5 Consent of KPMG Peat Marwick LLP.
23.6 Consent of Price Waterhouse, LLP.
23.7 Consent of Baker & Botts, L.L.P. (included in Exhibit 5 and Exhibit 8).
24 Power of Attorney (included on pages II-8 and II-9).
</TABLE>
II-4
<PAGE>
<TABLE>
<C> <S>
25.1 Statement of Eligibility of The Bank of New York, as Trustee, on Form T-
1.
25.2 Statement of Eligibility of the Trustee under the Senior Subordinated
Indenture, on Form T-1+.
25.3 Statement of Eligibility of the Trustee under the Subordinated Indenture,
on
Form T-1.+
</TABLE>
- --------
+ To be filed separately pursuant to Section 305(b)(2) of the Trust Indenture
Act of 1939, as amended, and the rules and regulations prescribed by the
Commission thereunder.
ITEM 17. UNDERTAKINGS
The undersigned Registrants hereby undertake:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement.
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20 percent change
in the maximum aggregate offering price set forth in the "Calculation
of Registration Fee" table in the effective registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
Provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrants
pursuant to section 13 or section 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(4) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the Registrants' annual report pursuant to
section 13(a) or 15(d) of the Securities Exchange Act of 1934 that is
incorporated by reference in the registration statement shall be deemed to
be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(5) If any of the Offered Securities are offered at competitive bidding,
(a) to use its best efforts to distribute prior to the opening of bids, to
prospective bidders, underwriters, and dealers, a reasonable number of
copies of a prospectus which at that time meets the requirements of section
10(a) of the Act, and relating to the securities offered at competitive
bidding, as contained in the registration statement together with any
supplements thereto and (b) to file an amendment to the registration
statement reflecting the results of bidding, the terms of the reoffering
and related matters to the extent required by the applicable form, not
later than the first use, authorized by the issuer after the opening of
bids, of a prospectus relating to the
II-5
<PAGE>
securities offered at competitive bidding, unless no further public
offering of such securities by the issuer and no reoffering of such
securities by the purchasers is proposed to be made.
(6) To file an application for the purpose of determining the eligibility
of the trustee to act under subsection (a) of Section 310 of the Trust
Indenture Act ("TIA") in accordance with the rules and regulations
prescribed by the Commission under Section 305(b)(2) of the TIA.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrants pursuant to the provisions described under Item 15 above, or
otherwise, the Registrants have been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act of 1933 and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrants of expenses incurred or
paid by a director, officer or controlling person of the Registrants in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrants will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act of 1933 and will be
governed by the final adjudication of such issue.
II-6
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF THE
REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS REGISTRATION
STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED, IN THE CITY OF GREENWOOD VILLAGE, STATE OF COLORADO, ON SEPTEMBER
29, 1995.
TCI Communications, Inc.
/s/ Stephen M. Brett
By: _________________________________
NAME: STEPHEN M. BRETT
TITLE: EXECUTIVE VICE-PRESIDENT
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED, THE
REGISTRANT CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS
ALL OF THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS
REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED,
THEREUNTO DULY AUTHORIZED, IN THE CITY OF GREENWOOD VILLAGE, STATE OF
COLORADO, ON SEPTEMBER 29, 1995.
Tele-Communications, Inc.
/s/ Stephen M. Brett
By: _________________________________
NAME: STEPHEN M. BRETT
TITLE: EXECUTIVE VICE-PRESIDENT
II-7
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Stephen M. Brett, Esq., and Elizabeth M.
Markowski, Esq., and each of them, his true and lawful attorneys-in-fact and
agents with full power of substitution and re-substitution for him and in his
name, place and stead, in any and all capacities, to sign any or all
amendments (including post-effective amendments) to this Registration
Statement and to file the same, with all exhibits thereto, and other documents
in connection therewith, with the Securities and Exchange Commission, granting
unto said attorneys-in-fact and agents and each of them full power and
authority, to do and perform each and every act and thing requisite or
necessary to be done in and about the premises, to all intents and purposes
and as fully as they might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents or their substitutes may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:
SIGNATURE TITLE DATE
--------- ----- ----
/s/ Bob Magness Chairman of the 9/29/95
- ------------------------------------- Board and Director
(BOB MAGNESS) of the Company
/s/ John C. Malone Director of the 9/29/95
- ------------------------------------- Company
(JOHN C. MALONE)
/s/ Donne F. Fisher Director of the 9/29/95
- ------------------------------------- Company
(DONNE F. FISHER)
/s/ Brendan R. Clouston President of the 9/29/95
- ------------------------------------- Company (Principal
(BRENDAN R. CLOUSTON) Executive Officer)
/s/ Gary K. Bracken Senior Vice 9/29/95
- ------------------------------------- President and
(GARY K. BRACKEN) Controller of the
Company (Principal
Financial and
Accounting Officer)
II-8
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Stephen M. Brett, Esq., and Elizabeth M.
Markowski, Esq., and each of them, his true and lawful attorneys-in-fact and
agents with full power of substitution and re-substitution for him and in his
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to
file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents and each of them full power and authority, to do
and perform each and every act and thing requisite or necessary to be done in
and about the premises, to all intents and purposes and as fully as they might
or could do in person, hereby ratifying and confirming all that said attorneys-
in-fact and agents on their substitutes may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:
SIGNATURE TITLE DATE
--------- ----- ----
/s/ Bob Magness Chairman of the 9/29/95
- ------------------------------------- Board and Director
(BOB MAGNESS) of TCI
/s/ John C. Malone President and 9/29/95
- ------------------------------------- Director of TCI
(JOHN C. MALONE) (Principal
Executive Officer)
/s/ Donne F. Fisher Executive Vice 9/29/95
- ------------------------------------- President and
(DONNE F. FISHER) Director of TCI
(Principal
Financial and
Accounting Officer)
/s/ John W. Gallivan Director of TCI 9/13/95
- -------------------------------------
(JOHN W. GALLIVAN)
/s/ Kim Magness Director of TCI 9/29/95
- -------------------------------------
(KIM MAGNESS)
/s/ Robert A. Naify Director of TCI 9/29/95
- -------------------------------------
(ROBERT A. NAIFY)
II-9
<PAGE>
SIGNATURE TITLE DATE
--------- ----- ----
/s/ Jerome H. Kern Director of TCI 9/29/95
- -------------------------------------
(JEROME H. KERN)
/s/ Tony Coelho Director of TCI 9/29/95
- -------------------------------------
(TONY COELHO)
/s/ R. E. Turner Director of TCI 9/29/95
- -------------------------------------
(R. E. TURNER)
II-10
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NUMBER EXHIBIT PAGE
------- ------- ------------
<C> <S> <C>
1.1 Form of Underwriting Agreement.
1.2 Form of Distribution Agreement.
4.1 Form of Senior Indenture between the Registrant and The
Bank of New York, as Trustee, as amended.
4.2 Form of Senior Subordinated Indenture.
4.3 Form of Subordinated Indenture.
4.4 Form of Fixed Rate Medium-Term Note Series C.
4.5 Form of Floating Rate Medium-Term Note Series C.
4.6 Restated Certificate of Incorporation of the Company
dated as of August 4, 1994. (Incorporated herein by
reference to Exhibit 3.3 of the Company's Annual
Report on Form 10-K for the year ended December 31,
1994, as amended by Form 10-K/A (Amendment No. 1)
(Commission File No. 0-5550)).
4.7 Restated Certificate of Incorporation of the Parent
dated August 4, 1994, as amended on August 4, 1994,
August 16, 1994, October 11, 1994, October 21, 1994,
January 26, 1995, August 3, 1995 and August 3, 1995.
(Incorporated herein by reference to Exhibit 99.1 of
the Parent's Current Report on Form 8-K, dated August
10, 1995 (Commission File No. 0-20421)).
4.8 Bylaws of the Company as adopted August 4, 1994
(Incorporated herein by reference to Exhibit 3.4 of
the Company's Annual Report on Form 10-K for the year
ended December 31, 1994, as amended by Form 10-K/A
(Amendment No. 1) (Commission File No. 0-5550)).
4.9 Bylaws of the Parent as adopted June 16, 1994
(Incorporated herein by reference to Exhibit 3.2 of
the Parent's Annual Report on Form 10-K for the year
ended December 31, 1994, as amended by Form 10-K/A
(Amendment No. 1) (Commission File No. 0-20421)).
5 Opinion of Baker & Botts, L.L.P. regarding the legality
of the securities being registered.
8 Opinion of Baker & Botts, L.L.P. regarding certain tax
matters.
12 Calculation of Ratios of Earnings to fixed Charges of
the Company.
23.1 Consent of KPMG Peat Marwick LLP.
23.2 Consent of KPMG Peat Marwick LLP.
23.3 Consent of KPMG.
23.4 Consent of KPMG Finsterbusch Pickenhayn Sibille.
23.5 Consent of KPMG Peat Marwick LLP.
23.6 Consent of Price Waterhouse LLP.
23.7 Consent of Baker & Botts, L.L.P (included in Exhibit 5
and Exhibit 8).
24 Power of Attorney (included on pages II-8 and II-9).
25.1 Statement of Eligibility of The Bank of New York as
Trustee, on
Form T-1.
25.2 Statement of Eligibility of the Trustee under the
Senior Subordinated Indenture, on Form T-1.+
25.3 Statement of Eligibility of the Trustee under the
Subordinated Indenture, on Form T-1.+
</TABLE>
- --------
+ To be filed separately pursuant to Section 305(b)(2) of the Trust Indenture
Act of 1939, as amended, and the rules and regulations prescribed by the
Commission thereunder.
<PAGE>
EXHIBIT 1.1
UNDERWRITING AGREEMENT
[Date]
[To the Underwriter or Underwriters]
Dear Sirs:
TCI Communications, Inc. (the "Company") proposes to issue and sell [ ]
principal amount of its (the "Offered Securities") pursuant to an
indenture dated as of , 199 ([as amended and] as the same may be [further]
amended or supplemented, the "Indenture"), with , as trustee (the
"Trustee"). Each Offered Security will be issuable in the denominations and
shall have the terms set forth in Exhibit A. [The term "Underwriters" as used
herein will mean and refer collectively to the one or more several
Underwriters named in Exhibit B (and any substitute underwriter pursuant to
Section 9 hereof), the term "Underwriter" will refer to any of the several
Underwriters named in Exhibit B (and any substitute underwriter pursuant to
Section 9 hereof), and the term "Representatives" will refer to you in your
capacity as the Representatives of the several Underwriters or, in the event
no Representatives shall have been appointed, in your capacity as
Underwriters. Any reference to you in this Agreement shall be solely in your
capacity as Representatives.] The Company confirms as follows its agreement
with the Underwriter[s]:
1. Registration Statement and Prospectus: The Company and Tele-
Communications, Inc. (the "Parent") have filed with the Securities and
Exchange Commission (the "Commission"), in accordance with the Securities Act
of 1933, as amended, and the rules and regulations of the Commission
promulgated thereunder (collectively called the "Act"), a shelf registration
statement on Form S-3 (File No. 33- ), including a prospectus, relating to
debt securities of the Company ("Debt Securities") issuable from time to time
in one or more series, [including the Offered Securities], shares of Series A
TCI Group Common Stock, $1.00 par value per share, of the Parent (the "Common
Stock") issuable from time to time upon conversion of convertible Debt
Securities, [including the shares (the "Common Shares") issuable upon
conversion of the Offered Securities,] and guarantees of the Parent that may
be issued in respect of any Offered Securities that are convertible Debt
Securities, which has become effective under the Act, and will promptly file
with the Commission a prospectus supplement specifically relating to the
Offered Securities pursuant to Rule 424 under the Act. As used in this
Agreement, the term "Registration Statement" means such registration
statement, including exhibits and financial statements and schedules and
documents incorporated by reference therein, as amended or supplemented to the
date hereof and, in the case of references to the Registration Statement as of
a date subsequent to the date hereof, as amended or supplemented as of such
date. The term "Basic Prospectus" means the prospectus included in the
Registration Statement. The term "Prospectus" means the Basic Prospectus
together with the prospectus supplement specifically relating to the Offered
Securities as filed with the Commission pursuant to Rule 424 under the Act and
any information deemed to be a part thereof pursuant to Rule 434 under the
Act. The term "preliminary prospectus" means any preliminary prospectus
supplement specifically relating to the Offered Securities together with the
Basic Prospectus. Any reference herein to any preliminary prospectus or the
Prospectus shall be deemed to refer to and include the documents incorporated
by reference therein pursuant to Item 12 of Form S-3 under the Act, as of the
date of such preliminary prospectus or the Prospectus, as the case may be, and
any reference herein to any amendment or supplement to any preliminary
prospectus or the Prospectus, except the reference in Section 4(c), shall be
deemed to refer to and include any documents filed after such date under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and so
incorporated by reference.
2. Agreements to Sell and Purchase: The Company agrees to sell to you, and
upon the basis of the representations, warranties and agreements of the
Company herein contained and subject to the terms and conditions of this
Agreement [each of] the Underwriter[s] agrees to purchase from the Company,
[severally and not jointly], the [principal amount] [number] of Offered
Securities set forth opposite your [respective] names in Exhibit B, at a
purchase price per Offered Security of $ , plus accrued [interest] [original
issued discount] from .
With respect to any of the Offered Securities purchased by you hereunder
that you continue to own or hold at any time on or after the 90th day
following the Closing Date (as defined in Section 3), you agree that upon
<PAGE>
receipt of written notice from the Company of its intention to bid for or
purchase any Offered Security or any security of the same class and series as
the Offered Securities or to take any other action, directly or indirectly,
the taking of which would be proscribed by Rule 10b-6 promulgated by the
Commission under the Exchange Act (or any successor or equivalent rule or
regulation) during the distribution of the Offered Securities, you will, and
will cause your "affiliated purchasers" (as defined in said Rule) to, cease
distributing the Offered Securities for such period of time as the Company may
deem necessary so that the action or actions proposed to be taken, directly or
indirectly, by it may be taken in full compliance with such Rule (or any
successor or equivalent rule or regulation).
3. Delivery and Payment: Delivery of and payment for the Offered Securities
shall be made at 10:00 A.M., New York time, on (such time and date are
referred to herein as the "Closing Date"), at the office of New York, New
York. The Closing Date and the place of delivery of and payment for the
Offered Securities may be varied by agreement between you and the Company.
Delivery of the Offered Securities (in definitive form and registered in
such names and in such authorized denominations as you shall request at least
two business days prior to the Closing Date by written notice to the Company)
shall be made to you against payment by you of the purchase price therefor by
cashier or official bank check or checks payable to the order of the Company
in New York Clearing House (next day) funds. For the purpose of expediting the
checking and packaging of the Offered Securities, the Company agrees to make
the Offered Securities available to you for inspection at least 24 hours prior
to the Closing Date or such shorter period of time as you may agree to.
4. Agreements of the Company: The Company agrees with you as follows:
(a) The Company will notify you promptly, and (if requested by you in
writing) will confirm such advice in writing, (1) of the effectiveness of
any amendment to the Registration Statement and of the filing of any
supplement to the Prospectus, (2) of any comments of the Commission
regarding the Registration Statement or the Prospectus (or any of the
documents incorporated by reference therein) or of any request by the
Commission for amendments or supplements to the Registration Statement or
the Prospectus or for additional information, (3) of the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement or the initiation or threatening of any proceedings
for that purpose, (4) of the receipt by the Company of any notification
with respect to the suspension of the qualification of the Offered
Securities [or the Common Shares] for offer or sale in any jurisdiction or
the initiation or threatening of any proceedings for such purpose and (5)
of the happening of any event during the period mentioned in paragraph (d)
below which makes any statement of a material fact made in the Registration
Statement or the Prospectus (as theretofore amended or supplemented) untrue
or which requires the making of any changes in the Registration Statement
or the Prospectus (as theretofore amended or supplemented) in order to make
the statements therein, in light of the circumstances when the Prospectus
is delivered to a purchaser, not misleading. The Company will use its
reasonable best efforts to prevent the issuance of any order suspending the
effectiveness of the Registration Statement or suspending the qualification
of the Offered Securities [or the Common Shares] for offer or sale in any
jurisdiction, and if any such order is issued, the Company will make every
reasonable effort to obtain the withdrawal of such order at the earliest
possible moment.
(b) The Company will furnish to [each of] you, without charge, one
conformed copy of the Registration Statement and any post-effective
amendment thereto, including all financial statements and schedules,
exhibits and documents incorporated therein by reference (including
exhibits incorporated therein by reference to the extent not previously
furnished to you).
(c) The Company will give you advance notice of its intention to file any
amendment or supplement to the Registration Statement or the Prospectus
with respect to the Offered Securities, and will not file any such
amendment or supplement to which you shall reasonably object in writing.
(d) During the period of time that the Prospectus is required by law to
be delivered, the Company will deliver to each Underwriter, without charge,
as many copies of the Prospectus or any amendment or supplement thereto as
such Underwriter may reasonably request. The Company consents to the use of
the
2
<PAGE>
Prospectus or any amendment or supplement thereto by the Underwriters and
by all dealers to whom the Offered Securities may be sold, both in
connection with the offering or sale of the Offered Securities and for such
period of time thereafter as the Prospectus is required by law to be
delivered in connection therewith. If during such period of time any event
shall occur which in the judgment of the Company should be set forth (or
incorporated by reference) in the Prospectus in order to make the
statements therein, in light of the circumstances when the Prospectus is
delivered to a purchaser, not misleading, or if it is necessary to
supplement or amend the Prospectus to comply with law, the Company will
forthwith prepare and duly file with the Commission an appropriate
supplement or amendment thereto, and forthwith file all reports and any
definitive proxy statement or information statement required to be filed by
the Company with the Commission pursuant to Section 13 or 14 of the
Exchange Act subsequent to the date of the Prospectus, and will deliver to
each Underwriter, without charge, such number of copies thereof as such
Underwriter may reasonably request. If during such period of time any event
shall occur which in your judgment should be so set forth (or incorporated
by reference) in the Prospectus, or which in your judgment makes it
necessary to so supplement or amend the Prospectus, the Company will
consult with you concerning the necessity of filing with the Commission a
supplement or an amendment to the Prospectus or a report pursuant to
Section 13 or 14 of the Exchange Act.
(e) Prior to any public offering of the Offered Securities by the
Underwriter[s], the Company will cooperate with you and your counsel in
connection with the registration or qualification of the Offered Securities
[and the Common Shares] for offer and sale under the securities or Blue Sky
laws of, and the determination of the eligibility of the Offered Securities
for investment under the laws of, such jurisdictions as you request;
provided, that in no event shall the Company be obligated to qualify to do
business as a foreign corporation or as a securities dealer in any
jurisdiction where it is not now so qualified, to conform its
capitalization or the composition of its assets to the securities or Blue
Sky laws of any jurisdiction or to take any action which would subject it
to taxation or general service of process in any jurisdiction where it is
not now so subject. The Company will pay all reasonable fees and expenses
(including reasonable counsel fees and expenses) relating to qualification
of the Offered Securities [and the Common Shares] under such securities or
Blue Sky laws and in connection with the determination of the eligibility
of the Offered Securities for investment under the laws of such
jurisdictions as you may designate.
(f) The Company will make generally available to its security holders and
to you consolidated earnings statements (which need not be audited) that
satisfy the provisions of Section 11(a) of the Act and Rule 158 thereunder.
(g) The Company will pay all expenses in connection with (1) the
preparation, printing and filing of the Registration Statement, any
preliminary prospectus, the Prospectus, any legal investment memorandum and
Blue Sky memorandum as contemplated by Section 4(e), (2) the preparation,
issuance and delivery of the Offered Securities (other than transfer taxes)
and the execution and delivery of the Indenture, (3) the printing of any
Dealer Agreement, (4) furnishing such copies of the Registration Statement,
the Prospectus and any preliminary prospectus, and all amendments and
supplements thereto, including any term sheets delivered by the Company
pursuant to Rule 434 under the Act, as may be requested for use in
connection with the offering and sale of the Offered Securities by dealers
to whom Offered Securities may be sold, and (5) any fees paid to rating
agencies, if any, selected by the Company in connection with the rating of
the Offered Securities.
(h) If this Agreement is terminated by you because any condition to the
obligations of the Underwriters set forth in Section 7 hereof is not
satisfied or because of any failure or refusal on the part of the Company
to comply with the terms hereof or if for any reason the Company shall be
unable to perform its obligations hereunder, the Company will reimburse the
Underwriters for all out-of-pocket expenses (including the fees and
expenses of your counsel) reasonably incurred by the Underwriters in
connection herewith. The Company will not in any event be liable to the
Underwriters for damages on account of loss of anticipated profits.
(i) From the date hereof to and including the Closing Date, the Company
will not offer or sell, or contract to sell, any Debt Securities with a
maturity of more than one year, including additional Offered Securities,
pursuant to a public offering without your prior written consent.
3
<PAGE>
5. Representations and Warranties of the Company: The Company represents and
warrants to each Underwriter that:
(a) the documents incorporated by reference in the Registration Statement
and the Prospectus, when they were filed (or, if an amendment with respect
to any such document was filed, when such amendment was filed) with the
Commission, conformed in all material respects to the requirements of the
Exchange Act and the rules and regulations of the Commission promulgated
thereunder, and any further documents so filed and incorporated by
reference will, when they are filed with the Commission, conform in all
material respects to the requirements of the Exchange Act and the rules and
regulations of the Commission promulgated thereunder; none of such
documents, when it was filed (or, if an amendment with respect to any such
document was filed, when such amendment was filed), 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, in light
of the circumstances under which they were made, not misleading; and no
such further document, when it is filed, will contain an untrue statement
of a material fact or will omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they are made, not misleading;
(b) the Registration Statement, when declared effective by the
Commission, complied in all material respects with the requirements of the
Act; each preliminary prospectus or term sheet, if any, relating to the
Offered Securities, filed pursuant to Rule 424 or Rule 434 under the Act,
will comply when so filed in all material respects with the Act; and when
the Prospectus or any such term sheet is first filed with the Commission
pursuant to Rule 424 or Rule 434 and as of the Closing Date, the
Registration Statement and the Prospectus (as amended or supplemented, if
applicable) will comply in all material respects with the requirements of
the Act and the Indenture will comply in all material respects with the
requirements of the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"). When it was declared effective by the Commission, the
Registration Statement did not, and as of the date the Prospectus is first
filed with the Commission pursuant to Rule 424 or Rule 434 and as of the
Closing Date the Registration Statement (as amended or supplemented, if
applicable) will not, contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading. When the Prospectus is first
filed with the Commission pursuant to Rule 424 or Rule 434 and as of the
Closing Date, the Prospectus (as amended or supplemented, if applicable)
will not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading. Notwithstanding the foregoing, this representation
and warranty does not apply to statements or omissions in the Registration
Statement or the Prospectus or any preliminary prospectus made in reliance
upon information furnished to the Company in writing by you expressly for
use therein or to that part of the Registration Statement which consists of
the Statements of Eligibility on Form T-1 under the Trust Indenture Act of
the trustees for the Debt Securities;
(c) the Offered Securities and the Indenture have been duly authorized by
the Company [and the Common Shares have been duly authorized by the Parent]
and each will conform to the descriptions thereof in the Prospectus;
(d) the issuance and sale of the Offered Securities [the delivery of the
Common Shares], and the fulfillment of the terms of this Agreement will not
result in a breach of any of the terms or provisions of, or constitute a
default under, the Company's charter or by-laws or any indenture, mortgage,
deed of trust or other material agreement or instrument to which the
Company or any of its significant subsidiaries (as such term is defined in
Rule 1.02(v) of Regulation S-X) is now a party or by which it is bound, or
any order of any court or governmental agency or authority entered in any
proceeding to which the Company or any of its significant subsidiaries was
or is now a party or by which it is bound;
(e) KPMG Peat Marwick LLP, the Company's auditors, are independent
accountants as required by the Act;
(f) so long as may be required for the distribution of the Offered
Securities by the Underwriters or by any dealers that participate in the
distribution thereof, the Company will comply with all requirements under
4
<PAGE>
the Exchange Act relating to the timely filing with the Commission of its
reports pursuant to Section 13 of the Exchange Act and of its proxy
statements pursuant to Section 14 of the Exchange Act; [and]
(g) except to the extent set forth in the Prospectus, the Company has not
received any notice of, nor does it have any actual knowledge of, any
failure by it or any of its significant subsidiaries to be in substantial
compliance with all existing statutes and regulations applicable to it or
such subsidiaries, which failure would materially and adversely affect the
conduct of the business of the Company and its subsidiaries, considered as
a whole; [and]
(h) the Parent has reserved a sufficient number of Common Shares to cover
the conversion of all the Offered Securities at the initial conversion
[price] [rate] (prior to any adjustment of such [price] [rate] pursuant to
the Offered Securities and the Indenture); the Common Shares, when issued
or delivered upon conversion of the Offered Securities, will be duly and
validly authorized, issued, fully paid and non-assessable; and the Common
Shares are free of preemptive rights.
6. Indemnification: The Company agrees to indemnify and hold harmless each
Underwriter, and each person, if any, who controls each Underwriter within the
meaning of either Section 15 of the Act or Section 20 of the Exchange Act,
from and against any and all losses, claims, damages, liabilities and expenses
(including reasonable costs of investigation) arising out of or based upon any
untrue statement or alleged untrue statement of a material fact contained in
the Registration Statement or the Prospectus or in any amendment or supplement
thereto or in any preliminary prospectus, or arising out of or based upon any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, except insofar as
such losses, claims, damages, liabilities or expenses arise out of or are
based upon any such untrue statement or omission or allegation thereof based
upon information furnished in writing to the Company by you expressly for use
therein; provided, however, the Company shall not indemnify any Underwriter or
any person who controls such Underwriter from any such losses, claims, damages
or liabilities alleged by any person who purchased Offered Securities from
such Underwriter if the untrue statement, omission or allegation thereof upon
which such losses, claims, damages or liabilities are based was made in: (i)
any preliminary prospectus, if a copy of the Prospectus (as then amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto) was not sent or given by or on behalf of such Underwriter to such
person at or prior to the written confirmation of the sale of Offered
Securities to such person, and if the Prospectus (as so amended or
supplemented) corrected the untrue statement or omission giving rise to such
loss, claim, damage or liability; (ii) any Prospectus used by any Underwriter
or any person who controls such Underwriter, after such time as the Company
advised you that the filing of a post-effective amendment or supplement
thereto was required, except the Prospectus as so amended or supplemented; or
(iii) any Prospectus used after such time as the obligation of the Company to
keep the same current and effective has expired. This indemnity will be in
addition to any liability which the Company may otherwise have.
If any action or proceeding (including any governmental investigation) shall
be brought or asserted against any Underwriter or any person controlling such
Underwriter in respect of which indemnity may be sought from the Company, such
Underwriter or such controlling person shall promptly notify the Company in
writing, and the Company shall assume the defense thereof, including the
employment of counsel reasonably satisfactory to such Underwriter and the
payment of all expenses. Any omission so to notify the Company shall not,
however, relieve the Company from any liability which it may have to any
indemnified party otherwise than under this Section 6. Any such Underwriter or
any such controlling person shall have the right to employ separate counsel in
any such action or proceeding and to participate in the defense thereof, but
the fees and expenses of such separate counsel shall be such Underwriter's
expense or the expense of such controlling person unless (a) the Company has
agreed to pay such fees and expenses or (b) the Company shall have failed to
assume the defense of such action or proceeding and employ counsel reasonably
satisfactory to such Underwriter in any such action or proceeding or (c) the
named parties to any such action or proceeding (including any impleaded
parties) include both such Underwriter or such controlling person and the
Company, and such Underwriter or such controlling person shall have been
advised by its counsel that there may be a conflict of interest between it or
such controlling person and the Company in the conduct of the defense of such
action (in which case, if such Underwriter or such controlling person notifies
the Company in writing that it elects to employ separate counsel at the
expense of the Company, the Company shall not have the right to assume the
defense of such action or
5
<PAGE>
proceeding on behalf of such Underwriter or on behalf of such controlling
person), it being understood, however, that the Company shall not, in
connection with any one such action or proceeding or separate but
substantially similar or related actions or proceedings arising out of the
same general allegations or circumstances, be liable for the reasonable fees
and expenses of more than one separate firm of attorneys (unless the members
of such firm are not admitted to practice in a jurisdiction where an action is
pending, in which case the Company shall pay the reasonable fees and expenses
of one additional firm of attorneys to act as local counsel in such
jurisdiction, provided the services of such counsel are substantially limited
to that of appearing as attorneys of record) at any time for all indemnified
parties, which firm shall be designated in writing by such Underwriter. The
Company shall not be liable for any settlement of any such action or
proceeding effected without its written consent, but if settled with its
written consent, or if there be a final judgment for the plaintiff in any such
action or proceeding, the Company agrees to indemnify and hold harmless such
Underwriter and any such controlling person from and against any loss or
liability by reason of such settlement or judgment.
Each Underwriter [severally] agree[s] to indemnify and hold harmless the
Company, its directors and each of its officers, and each person, if any, who
controls the Company within the meaning of either Section 15 of the Act or
Section 20 of the Exchange Act, to the same extent as the foregoing indemnity
from the Company to such Underwriter, but only with respect to information
furnished in writing by such indemnifying party expressly for use in the
Registration Statement, the Prospectus, or any amendment or supplement
thereto, or any preliminary prospectus. In case any action or proceeding shall
be brought against the Company or its directors or officers or any such
controlling person, in respect of which indemnity may be sought against any
Underwriter, such Underwriter shall have the rights and duties given to the
Company, and the Company or its directors or officers or such controlling
person shall have the rights and duties given to such Underwriter, by the
preceding paragraph.
If the indemnification provided for in this Section 6 is unavailable to an
indemnified party under the first or third paragraph hereof in respect of any
losses, claims, damages or liabilities referred to therein (other than by
reason of such indemnified party's failure to comply with the first sentence
of the second paragraph of this Section 6), 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 or liabilities (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company on the one hand and you
on the other hand from the offering of the Offered Securities or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company on
the one hand and you on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and you on the other in connection
with the offering of the Offered Securities shall be deemed to be in the same
proportion as the total net proceeds from the offering of the Offered
Securities received by the Company bear to the total underwriting discounts
received by you in respect thereof. The relative fault of the Company on the
one hand and you on the other 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 you 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 and liabilities referred to above shall be
deemed to include, subject to the limitations set forth in the second
paragraph of this Section 6, any legal or other fees or expenses reasonably
incurred by such party in connection with investigating or defending any
action or claim.
The Company and each Underwriter agree that it would not be just and
equitable if contribution pursuant to this Section 6 were determined by pro
rata allocation or by any other method of allocation which does not take
account of the equitable considerations referred to in the immediately
preceding paragraph. Notwithstanding the provisions of this Section 6, no
Underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the Offered Securities were offered to the
public exceeds the amount of any damages which it have 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.
6
<PAGE>
The indemnity and contribution agreements contained in this Section 6 and
the representations and warranties of the Company contained in this Agreement
shall remain operative and in full force and effect regardless of (a) any
investigation made by or on behalf of the Underwriters, by or on behalf of any
person controlling such Underwriters or by or on behalf of the Company, (b)
acceptance of any of the Offered Securities and payment therefor or (c) any
termination of this Agreement.
7. Conditions of the Underwriters' Obligations: The Underwriters'
obligations hereunder are subject to the following conditions:
(a) at the Closing Date, [(i)] no stop order suspending the effectiveness
of the Registration Statement shall have been issued and no proceedings for
that purpose shall be pending or threatened by the Commission; and you
shall have received a certificate, dated the Closing Date and signed by the
Chairman of the Board, the President, an Executive Vice President or the
Senior Vice President--Finance and Treasurer of the Company (who may, as to
threatened proceedings, rely upon the best of his information and belief),
to that effect and to the effect set forth in clause (e) of this Section 7
[(with respect to Senior Debt Securities only), and (ii) the rating
assigned by either Duff & Phelps Credit Rating Co. or its successor or by
Moody's Investors Service, Inc. or its successor to any debt securities of
the Company as of the date of this Agreement shall not have been lowered
since that date];
(b) you shall have received opinions, dated the Closing Date and
reasonably satisfactory to counsel for the Underwriters, (A) from Messrs.
Cole, Raywid & Braverman, L.L.P. or such other special communications
counsel for the Company as may be reasonably satisfactory to you, (B) from
the General Counsel of the Company to the following effect and covering
such additional matters as you may reasonably request:
(i) the Company and each of its significant subsidiaries is a
corporation duly organized, validly existing and in good standing under
the laws of the jurisdiction of its incorporation and has the corporate
power and authority to carry on its business as described in the
Prospectus (as amended or supplemented, if applicable) and the Company
has the corporate power and authority to execute and deliver and
perform its obligations under this Agreement and to issue and sell the
Offered Securities as contemplated by this Agreement;
(ii) the Company and each of its significant subsidiaries is duly
qualified as a foreign corporation and is in good standing in each
jurisdiction in which the failure to so qualify would, in the
aggregate, have a material adverse effect upon the financial condition,
results of operations, business or properties of the Company and its
subsidiaries taken as a whole;
(iii) all corporate proceedings legally required in connection with
the authorization and issuance of the Offered Securities and the sale
of the Offered Securities by the Company in accordance with the terms
of this Agreement have been taken;
(iv) to the best knowledge of such counsel, there is no legal or
governmental proceeding pending or threatened against the Company or
any of its subsidiaries which is required to be disclosed in the
Prospectus (as amended or supplemented, if applicable) and is not so
disclosed and correctly summarized therein;
(v) to the best knowledge of such counsel, there is no contract or
other document known to such counsel of a character required to be
described in the Prospectus (as amended or supplemented, if applicable)
or to be filed as an exhibit to the Registration Statement (or to a
document incorporated by reference therein) that is not described or
filed as required;
(vi) the execution and delivery of this Agreement and the Indenture,
the issuance of the Offered Securities and the fulfillment of the terms
herein and therein contained do not conflict with, or result in a
breach of, or constitute a default under, the charter or by-laws of the
Company or, to the best knowledge of such counsel, conflict in any
material respect with, or result in a material breach of or constitute
a material default under any material agreement, indenture or other
instrument known to such counsel to which the Company or any of its
significant subsidiaries is a party or by which it is bound,
7
<PAGE>
or result in a violation of any law, administrative regulation or court
or governmental decree known to such counsel applicable to the Company
or any of its subsidiaries, except that such counsel need not express
any opinion with respect to (i) matters opined upon by special
communications counsel and Messrs. Sherman & Howard LLC or (ii) the
federal securities laws, the Blue Sky or securities laws of any
jurisdiction; and
(vii) to the best knowledge of such counsel, neither the Registration
Statement nor the Prospectus, as amended or supplemented, if applicable
(except as to the financial statements and schedules and any other
financial and statistical data contained or incorporated by reference
in the Registration Statement or Prospectus, as to which no opinion
need be expressed), contained, as of the date the Prospectus was first
filed with the Commission pursuant to Rule 424, or contains, as of the
Closing Date, any untrue statement of a material fact or omits to state
any material fact required to be stated therein or necessary to make
the statements therein (in the case of the Prospectus (as amended or
supplemented, if applicable), in light of the circumstances under which
they were made,) not misleading[; and]
[(viii) The Parent has reserved a sufficient number of the Common
Shares to cover the conversion of all the Offered Securities at the
initial conversion [price] [rate] (prior to any adjustment of such
[price] [rate] pursuant to the Offered Securities and the Indenture),
and such Common Shares, when so delivered upon such conversion in
accordance with the terms and provisions of the Offered Securities and
the Indenture, assuming no change in the applicable law or pertinent
facts, will be duly and validly authorized, issued, fully paid and non-
assessable].
(C) from Messrs. Sherman & Howard LLC, special counsel to the Company, to
the following effect and covering such additional matters as you may
reasonably request:
(i) the execution and delivery of this Agreement and the Indenture,
the issuance of the Offered Securities and the fulfillment of the terms
herein and therein contained do not, to the best knowledge of such
counsel, result in a material breach of or constitute a material
default under any material agreement for borrowed money known to such
counsel to which the Company or any of its significant subsidiaries is
a party or by which it is bound; and
(ii) the Company is not an "investment company" within the meaning of
the Investment Company Act of 1940, as amended, and is not subject to
regulation under such Act.
and (D) from Baker & Botts, L.L.P., special counsel to the Company, or such
other counsel to the Company as may be reasonably satisfactory to you, to the
following effect and covering such additional matters as you may reasonably
request:
(i) this Agreement and the Indenture have been duly authorized,
executed and delivered by the Company; and the Indenture is a legal,
valid and binding agreement of the Company enforceable in accordance
with its terms, except (A) as such enforceability may be limited by
bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium and other laws affecting creditors' rights generally, and
(B) that the remedy of specific performance and injunctive and other
forms of equitable relief are subject to certain equitable defenses and
to the discretion of the court before which any proceeding therefor may
be brought;
(ii) the Indenture has been duly qualified under, and complies in all
material respects with the requirements of, the Trust Indenture Act;
(iii) the Offered Debt Securities when executed and authenticated in
accordance with the terms of the Indenture and delivered to and paid
for by the Underwriters in accordance with this Agreement, will be
legal, valid and binding obligations of the Company entitled to the
benefits of the Indenture and enforceable in accordance with their
terms, except (A) as such enforceability may be limited by bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium and other
laws affecting creditors' rights generally, and (B) that the remedy of
specific performance and injunctive and other forms of equitable relief
are subject to certain equitable defenses and to the discretion of the
court before which any proceeding therefor may be brought;
8
<PAGE>
(iv) the Registration Statement is effective under the Act and, to
the best knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceeding for that purpose is pending or threatened by the Commission;
and
(v) the Offered Securities[, the Common Stock] and the Indenture
conform in all material respects as to legal matters to the
descriptions thereof in the Prospectus.
In addition, such counsel shall state that: "The Registration Statement
and the Prospectus, as amended or supplemented, if applicable (except as to
(x) the financial statements and schedules and any other financial and
statistical data contained or incorporated by reference therein and (y) the
documents incorporated or deemed to be incorporated by reference therein,
as to which no opinion is expressed), complied, as of the date the
Prospectus was first filed with the Commission pursuant to Rule 424, and
comply, as of the date hereof, as to form in all material respects with the
requirements of the Act and the rules and regulations of the Commission
under the Act (the "Rules"). In passing upon the form of such documents, we
have necessarily assumed the correctness and completeness of the statements
made or included therein by the Company and take no responsibility for the
accuracy, completeness or fairness of the statements contained therein
except insofar as such statements relate to the description of the Offered
Securities[, the Common Stock] and the Indenture or relate to us. However,
we have had conferences with certain officers and other representatives of
the Company, and our examination of the Registration Statement and the
Prospectus and our discussions in such conferences did not disclose to us
any information (relying as to the materiality of any such information
primarily upon officers and other representatives of the Company) which
gave us reason to believe that either the Registration Statement or the
Prospectus, as amended or supplemented, if applicable (except as to (x) the
financial statements and schedules and any other financial and statistical
data contained or incorporated by reference in the Registration Statement
or Prospectus and (y) the documents incorporated or deemed to be
incorporated by reference therein, as to which no opinion is expressed),
contained, as of the date the Prospectus was first filed with the
Commission pursuant to Rule 424, or contains, as of the date hereof, any
untrue statement of a material fact or omitted or omits to state any
material fact required to be stated therein or necessary to make the
statements therein, (in the case of the Prospectus (as amended or
supplemented, as applicable in light of the circumstances under which they
were made,) as applicable) in light of the circumstances under which they
were made,) not misleading.
In giving such opinions, such counsel may rely (x) as to matters of fact,
to the extent they deem proper, upon certificates of officers of the
Company, public officials and others, and (y) as to matters of law if other
than the United States or Colorado (in the case of Messrs. Sherman &
Howard, LLC and General Counsel of the Company) or New York (in the case of
Baker & Botts, L.L.P.), on the opinions of local counsel retained by them
or the Company, provided that such counsel are satisfactory to you and
counsel for the Underwriters;
(c) you shall have received on the Closing Date from Messrs. , your
counsel, an opinion to the effect set forth in clauses (D)(i) and (iii) and
to the effect that the Registration Statement and the Prospectus, as
amended or supplemented, if applicable, (except as to (x) the financial
statements and schedules and any other financial and statistical data
contained or incorporated by reference therein, and (y) the documents
incorporated or deemed to be incorporated by reference therein, as to which
no opinion need be expressed) comply as to form in all material respects
with the Act. In addition, you shall have received on the Closing Date from
Messrs. , or from the counsel acceptable to you, an opinion with respect
to the Registration Statement and the Prospectus in the form customarily
given by such firm;
(d) on the Closing Date you shall have received a letter addressed to you
from KPMG Peat Marwick, LLP independent auditors for the Company,
reasonably satisfactory to you;
(e) the representations and warranties of the Company in this Agreement
shall be true and correct on and as of the Closing Date; the Company shall
have complied with all agreements and satisfied all conditions on its part
to be performed or satisfied at or prior to the Closing Date; and except as
reflected in or contemplated by the Registration Statement and the
Prospectus, since the respective dates as of which information is given in
the Registration Statement and the Prospectus, there shall not have been,
at the
9
<PAGE>
Closing Date, any material adverse change in the condition (financial or
otherwise), business, prospects or results of operations of the Company and
its subsidiaries, considered as a whole; and
(f) subsequent to the date of this Agreement, there shall not have
occurred any change, or any development involving a prospective change, in
or affecting particularly the business, prospects or financial affairs of
the Company and its subsidiaries, considered as a whole which, in your
reasonable judgment, is so material and adverse that it would be
impracticable to proceed with the public offering or delivery of the
Offered Securities on the terms and in the manner contemplated by the
Prospectus.
8. Termination of Agreement: The obligation of the Underwriters to purchase
the Offered Securities may be terminated at any time prior to the Closing Date
by notice to the Company from you, without liability on your part to the
Company, if, on or prior to such date, (i) additional material governmental
restrictions, not in force and effect on the date of this Agreement, shall
have been imposed upon trading in securities generally or minimum or maximum
prices shall have been generally established on the New York Stock Exchange or
on the American Stock Exchange, or trading in securities generally shall have
been suspended on either such Exchange or trading in the common stock or debt
securities of the Company in the over-the-counter market shall have been
suspended or a general banking moratorium shall have been established by
Federal or New York authorities, or (ii) a war involving the United States of
America or other national calamity shall have occurred or shall have
accelerated to such an extent as to affect adversely the marketability of the
Offered Securities.
[9. Default by One or More of the Underwriters: If one or more of the
Underwriters shall fail on the Closing date to purchase the Offered Securities
that it or they are obligated to purchase hereunder (the "Defaulted
Securities"), the Representatives shall have the right, within 24 hours
thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any substitute underwriters, to purchase all, but not less
than all, of the Defaulted Securities in such amounts as may be approved by
the Representatives and upon the terms herein set forth; if, however, the
Representatives have not completed such arrangements within such 24-hour
period, then:
(a) if the principal amount of Defaulted Securities does not exceed 10%
of the aggregate principal amount of Offered Securities, the non-defaulting
Underwriters shall be obligated to purchase the full amount thereof in the
proportions that their respective underwriting obligations hereunder bear
to the underwriting obligations of all non-defaulting Underwriters, or
(b) if the principal amount of Defaulted Securities exceeds 10% of the
aggregate principal amount of Offered Securities, the Company shall be
entitled for an additional 24-hour period to find one or more substitute
underwriters satisfactory to the Representatives in their reasonable
discretion to purchase such Defaulted Securities.
In the event of any such default either the Representatives or the Company
shall have the right to postpone the Closing Date for a period not exceeding
seven days in order to effect any required changes in the Registration
Statement or Prospectus or in any other documents or arrangements relating to
the purchase of the Offered Securities.
If the principal amount of Defaulted Securities exceeds 10% of the aggregate
principal amount of Offered Securities, and neither the Representatives nor
the Company make arrangements pursuant to this Section 9 within the period
stated for the purchase of the Defaulted Securities, this Agreement shall
terminate without liability on the part of any non-defaulting Underwriter to
the Company except as provided in Section 6.
No action taken pursuant to this Section 9 shall relieve any defaulting
Underwriter from liability in respect of its default.
A substitute underwriter hereunder shall be an Underwriter for all purposes
of this Agreement.]
[9.][10.] Miscellaneous: Notice given pursuant to any of the provisions of
this Agreement shall be in writing and shall be mailed or delivered (a) to the
Company at its office, Terrace Tower II, 5619 DTC Parkway,
10
<PAGE>
Englewood, Colorado 80111-3000, attention: Bernard W. Schotters, Senior Vice
President--Finance, or (b) to you at your office at , attention of: .
Any notice under Section 8 hereof may be made by telex or telephone, but if so
made shall be subsequently confirmed in writing.
This Agreement has been and is made solely for the benefit of the
Underwriters and the Company and of the controlling persons, directors and
officers referred to in Section 6 hereof, and their respective successors and
assigns, and no other person shall acquire or have any right under or by
virtue of this Agreement. The term "successors and assigns" as used in this
Agreement shall not include a purchaser, as such purchaser, of Offered
Securities from any Underwriter.
This Agreement shall be governed by and construed in accordance with the
internal laws of the State of New York.
Please confirm that the foregoing correctly sets forth the agreement between
the Company and the Underwriters.
Very truly yours,
TCI Communications, Inc.
By:
--------------------------
Name:
Title:
Confirmed and Accepted as
of the date first above
mentioned.
[Underwriter or Underwriters]
By:
--------------------------
Name:
Title:
11
<PAGE>
EXHIBIT A
DEBT SECURITIES
Designation:
Dated Date:
Maturity [and provisions for extension, if any]:
Authorized Denominations:
[Interest rate (or method of computation), Interest Payment Dates and Record
Dates or, if Original Discount Securities, issue price and yield to maturity:]
[Sinking Fund:]
[Optional Redemption:]
[Provisions for purchase or exchange at option of the Holder or the Company:]
[Conversion price or conversion rate and conversion period:]
[Other specific terms:]
<PAGE>
EXHIBIT B
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT
UNDERWRITER OF OFFERED SECURITIES
----------- ---------------------
<S> <C>
</TABLE>
<PAGE>
EXHIBIT 1.2
TCI COMMUNICATIONS, INC.
MEDIUM-TERM NOTES, SERIES C DUE
9 MONTHS OR MORE FROM DATE OF ISSUE
DISTRIBUTION AGREEMENT
, 199
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
World Financial Center
North Tower, 10th Floor
New York, New York 10281-1310
CS First Boston Corporation
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
Lehman Brothers Inc.
American Express Tower
World Financial Center
New York, New York 10285-1800
Salomon Brothers Inc.
Seven World Trade Center
New York, New York 10048
Dear Sirs:
TCI Communications, Inc., a company duly incorporated under the laws of the
State of Delaware (the "Company"), confirms its agreement with Merrill Lynch &
Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, CS First Boston
Corporation, Lehman Brothers Inc. and Salomon Brothers Inc (each, an "Agent"
and, collectively, the "Agents") with respect to the issue and sale by the
Company of Medium-Term Notes, Series C described herein (the "Notes"). The
Notes are to be issued pursuant to an indenture, dated as of , 199 (the
"Indenture"), between the Company and The Bank of New York, as trustee (the
"Trustee"). Securities issued or to be issued under the Indenture, including
the Notes, are herein called "Securities".
As of the date hereof, the Company has authorized the issuance and sale of up
to U.S. $750,000,000 aggregate principal amount of Notes through or to the
Agents pursuant to the terms of this Agreement. It is understood, however, that
the Company may from time to time authorize the issuance of additional Notes
and that such additional Notes may be sold through or to the Agents pursuant to
the terms of this Agreement, all as though the issuance of such Notes were
authorized as of the date hereof.
This Agreement provides both for the sale of Notes by the Company directly to
purchasers, in which case an Agent will act as an agent of the Company in
soliciting Note purchases, and (as may from time to time be agreed to by the
Company and an Agent) to an Agent as principal for resale to purchasers.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 33- ) relating to,
among other things, the Securities and the offering thereof
<PAGE>
from time to time in accordance with Rule 415 under the Securities Act of
1933, as amended (the "1933 Act"), and has filed such amendments thereto as
may have been required to the date hereof. Such registration statement, as
amended, has been declared effective by the Commission, and the Indenture has
been qualified under the Trust Indenture Act of 1939, as amended (the "1939
Act"). Such registration statement, as amended as of each respective
Representation Date (as herein defined) (and any further registration
statements which may be filed by the Company for the purpose of registering
additional Notes), and the prospectus and prospectus supplement relating to
the Notes constituting a part thereof as amended and supplemented as of each
respective Representation Date, including in each case all documents
incorporated therein by reference and all exhibits thereto, as from time to
time amended or supplemented pursuant to the Securities Exchange Act of 1934,
as amended (the "1934 Act"), the 1933 Act or otherwise, are referred to herein
as the "Registration Statement" and the "Prospectus", respectively, except
that if any revised prospectus shall be provided to the Agents or any of them
by the Company for use in connection with the offering of the Notes which is
not required to be filed by the Company pursuant to Rule 424(b) under the 1933
Act, the term "Prospectus" shall refer to such revised prospectus and
prospectus supplement from and after the time it is first provided to the
Agents or any of them for such use.
Section 1. Appointment as Agents.
(a) Appointment of Agents. Subject to the terms and conditions stated
herein, the Company hereby appoints each of the Agents as agent of the Company
for the purpose of soliciting purchases of the Notes from the Company by
others and agrees that, except as otherwise contemplated herein, whenever the
Company determines to sell Notes directly to an Agent as principal for resale
to others, the Agent will enter into a Terms Agreement with the Company
(hereafter defined) relating to such sale in accordance with the provisions of
Section 3(b) hereof. Each Agent is authorized to engage the services of any
other broker or dealer in connection with the offer or sale of the Notes
purchased by the Agent as principal for resale to others but is not authorized
to appoint sub-agents. The Company may, from time to time, offer Notes for
sale otherwise than through an Agent; provided, however, that so long as this
Agreement shall be in effect the Company shall not solicit or accept offers to
purchase Notes through any agent other than an Agent, unless such agent shall
have entered into an agreement with the Company substantially similar to this
Agreement (including, but not limited to, Schedule A hereto). Written notice
of such agreement shall be given to the Agents within one day of the execution
thereof. In addition, the Company shall have the right at any time or from
time to time to sell Notes directly to investors.
(b) Reasonable Best Efforts Solicitations; Right to Reject Offers. Upon
receipt of instructions from the Company, each Agent will use its reasonable
best efforts to solicit purchases of such principal amount of the Notes as the
Company and the Agents shall agree upon from time to time during the term of
this Agreement, it being understood that the Company from time to time may
allocate or reallocate the Notes which are to be sold by any Agent and that
the Company shall not approve the solicitation of purchases of Notes in excess
of the principal amount of Securities registered pursuant to the Registration
Statement that from time to time remain unsold. The Agents will have no
responsibility for maintaining records with respect to the aggregate principal
amount of Notes sold, or of otherwise monitoring the availability of Notes for
sale under the Registration Statement. Each Agent will communicate to the
Company, orally or in writing, each reasonable offer to purchase Notes. Each
Agent shall have the right, in its discretion reasonably exercised, to reject
any proposed purchase of Notes, as a whole or in part, and any such rejection
shall not be deemed a breach of the Agent's agreement contained herein. The
Company shall have the sole right to accept any offers to purchase the Notes
and may reject in its sole discretion any proposed purchase of the Notes, in
whole or in part.
(c) Solicitations as Agent; Purchases as Principal. In soliciting purchases
of the Notes on behalf of the Company, each Agent shall act solely as agent
for the Company and not as principal. Each Agent shall make reasonable best
efforts to assist the Company in obtaining performance by each purchaser whose
offer to purchase Notes has been solicited by the Agent and accepted by the
Company. No Agent shall have any obligation to purchase Notes from the Company
as principal, but an Agent may agree from time to time to purchase Notes as
principal. Any such purchase of Notes by an Agent as principal shall be made
pursuant to a Terms Agreement in accordance with Section 3(b) hereof.
2
<PAGE>
(d) Reliance. The Company and each Agent agree that any Notes the placement
of which an Agent arranges shall be placed by the Agent, and any Notes
purchased, by an Agent shall be purchased by the Agent, in reliance on the
representations, warranties, covenants and agreements of the Company contained
herein and on the terms and conditions and in the manner provided herein, in
the Prospectus and in the Administrative Procedures (as defined in Section
3(c)).
Section 2. Representations and Warranties.
The Company represents and warrants to each Agent as of the date hereof, as
of the date of each acceptance by the Company of an offer for the purchase of
Notes (whether through an Agent as agent or to an Agent as principal), as of
the date of each delivery of Notes (whether through an Agent as agent or to an
Agent as principal) (the date and time of each such delivery to an Agent as
principal being hereafter referred to as a "Settlement Time"), and as of any
time that the Registration Statement or the Prospectus shall be amended or
supplemented (other than by an amendment or supplement (i) providing solely for
the specification of or a change in the interest rates, maturities, pricing or
other similar terms of any Notes or a change in the principal amount of Notes
remaining to be sold or similar changes (each an "Excluded Supplement") or (ii)
relating to an offering of Securities other than the Notes) or that there is
filed with the Commission any document incorporated by reference into the
Prospectus (other than any Current Report on Form 8-K relating exclusively to
the issuance of Securities other than the Notes under the Registration
Statement) (each of the dates or times referenced above being referred to
herein as a "Representation Date") as follows:
(a) Incorporated Documents. The documents incorporated by reference in
the Registration Statement and the Prospectus, when they were filed (or, if
an amendment with respect to any such document was filed, when such
amendment was filed) with the Commission, conformed in all material
respects to the requirements of the 1934 Act and the rules and regulations
of the Commission promulgated thereunder (the "1934 Act Regulations"), and
any further documents so filed and incorporated by reference will, when
they are filed with the Commission, conform in all material respects to the
requirements of the 1934 Act and the 1934 Act Regulations; none of such
documents, when it was filed (or, if an amendment with respect to any such
document was filed, when such amendment was filed), 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, in light
of the circumstances under which they were made, not misleading; and no
such further document, when it is filed, will contain an untrue statement
of a material fact or will omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they are made, not misleading.
(b) Registration Statement and Prospectus. The Registration Statement and
the Prospectus, at the time the Registration Statement became effective and
the Registration Statement and Prospectus as then amended or supplemented
as of each Representation Date, complied and will comply in all material
respects with the 1933 Act and the rules and regulations of the Commission
thereunder (the "1933 Act Regulations") and the Indenture will comply in
all material respects with the requirements of the 1939 Act and the rules
and regulations of the Commission thereunder (the "1939 Act Regulations").
The Registration Statement, at the time the Registration Statement became
effective (or, if an amendment to the Registration Statement or an annual
report on Form 10-K of the Company incorporated by reference into the
Prospectus has been filed with the Commission subsequent to the
effectiveness of the Registration Statement, then at the time of the most
recent such filing) and as then amended or supplemented as of each
Representation Date, did not and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading. The
Prospectus, at the time the Registration Statement became effective and as
then amended or supplemented as of each Representation Date, did not and
will not contain an untrue statement of a material fact or omit 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;
provided, however, that the representations and warranties in this
subsection shall not apply (i) with respect to an Agent, to statements or
omissions from the Registration Statement or Prospectus made in reliance
upon and in conformity with information furnished to the
3
<PAGE>
Company by or on behalf of such Agent expressly for use in the Registration
Statement or Prospectus or (ii) to that part of the Registration Statement
which shall constitute the Statement of Eligibility and Qualification under
the 1939 Act (Form T-1) of the Trustee under the Indenture.
(c) The Notes and The Indenture. The Notes and the Indenture have been
duly authorized by the Company and conform to the descriptions thereof in
the Prospectus.
(d) No Defaults. The issuance and sale of the Notes and the fulfillment
of the terms of this Agreement will not result in a breach of any of the
terms or provisions of, or constitute a default under, (i) the Company's
charter or bylaws, (ii) any indenture, mortgage, deed of trust or other
agreement or instrument to which the Company or any of its Significant
Subsidiaries (as such term is defined in Rule 1.02(v) of Regulation S-X) is
now a party or by which it is bound which would have a material adverse
effect on the conduct of the business of the Company and its consolidated
subsidiaries considered as one enterprise, or (iii) any order of any court
or governmental agency or authority entered in any proceeding to which the
Company or any of its Significant Subsidiaries was or is now a party or by
which it is bound.
(e) Accountants. KPMG Peat Marwick LLP, the Company's auditors, or its
successor are independent accountants as required by the 1933 Act.
(f) 1934 Act Filings. So long as may be required for the distribution of
the Notes by the Agents or by any dealers that participate in the
distribution thereof, the Company will comply with all requirements under
the 1934 Act relating to the timely filing with the Commission of its
reports pursuant to Section 13 of the 1934 Act and of its proxy statements
pursuant to Section 14 of the 1934 Act.
(g) Operating Permits, Certificates, etc. Except to the extent set forth
in the Prospectus, the Company has not received any notice of, nor does it
have any actual knowledge of, any failure by it or any of its Significant
Subsidiaries to be in substantial compliance with all material existing
statutes and regulations applicable to it or such Significant Subsidiaries,
which failure would materially and adversely affect the conduct of the
business of the Company and its consolidated subsidiaries, considered as
one enterprise.
Any certificate required hereby, signed by any executive officer of the
Company or Assistant Treasurer and delivered to an Agent or counsel for the
Agents shall be deemed a representation and warranty by the Company as to the
matters covered thereby.
Section 3. Solicitations as Agent; Purchases as Principal.
(a) Solicitations as Agent. On the basis of the representations and
warranties herein contained, but subject to the terms and conditions herein
set forth, each Agent agrees, as an agent of the Company, to use its
reasonable best efforts to solicit offers to purchase the Notes upon the terms
and conditions set forth herein, in the Prospectus and in the Administrative
Procedures.
The Company reserves the right, in its sole discretion, to (i) suspend
solicitation of purchases of the Notes through the Agents, in each case as
agent, commencing at any time for any period of time or permanently, and (ii)
allocate or reallocate the Notes which are to be sold by any Agent. Upon
receipt of instructions from the Company, each Agent receiving such
instructions will forthwith suspend solicitation of purchases from the Company
until such time as the Company has advised said Agent that such solicitation
may be resumed.
The Company agrees to pay each Agent a commission with respect to each
consummation of the sale of a Note by the Company as a result of a
solicitation made by such Agent, in the form of a discount, equal to the
applicable percentage as set forth in Schedule A hereto of the principal
amount of such Note or, in the case of an Original Issue Discount Note (as
defined in the Prospectus), of the Issue Price (as defined in the Prospectus)
of such Note.
The purchase price, interest rate, maturity date and other terms of the
Notes in connection with each sale of Notes to or through an Agent shall be
agreed upon by the Company and the Agent and set forth in a pricing
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supplement to the Prospectus to be prepared following each acceptance by the
Company of an offer for the purchase of Notes. Except as may be otherwise
provided in such supplement to the Prospectus, the Notes will be issued in
denominations of $1,000 or an integral multiple of $1,000. All Notes sold
through an Agent as agent will be sold at 100% of their principal amount unless
otherwise agreed to by the Company and the Agent.
(b) Purchases as Principal. Each sale of Notes to an Agent as principal shall
be made in accordance with the terms contained herein and (unless the Company
and such Agent shall otherwise agree in writing) only pursuant to a separate
agreement which shall provide for the sale of such Notes to, and the purchase
and reoffering thereof by, such Agent. Each such separate agreement (which may
be an oral agreement, confirmed in writing which may be a facsimile
transmission) between an Agent and the Company is herein referred to as a
"Terms Agreement". Unless the context otherwise requires, each reference
contained herein to "this Agreement" shall be deemed to include any applicable
Terms Agreement between the Company and an Agent. Each such Terms Agreement,
whether oral, confirmed in writing which may be a facsimile transmission, or in
writing, shall be with respect to such information (as applicable) as is
specified in Exhibit A hereto. An Agent's commitment to purchase Notes as
principal pursuant to any Terms Agreement shall be deemed to have been made on
the basis of the representations and warranties of the Company herein contained
and shall be subject to the terms and conditions herein set forth. Each Terms
Agreement with an Agent shall specify the principal amount of Notes to be
purchased by the Agent pursuant thereto, the price to be paid to the Company
for such Notes (which shall be at a discount equivalent to the applicable
commission set forth in Schedule A hereto unless otherwise specified in an
applicable Terms Agreement), the Settlement Time and place of delivery of and
payment for such Notes, any provisions relating to rights of, and default by,
purchasers acting together with the Agent in the reoffering of the Notes, and
such other provisions (including further terms of the Notes) as may be mutually
agreed upon. Each Agent may utilize a selling or dealer group in connection
with the resale of the Notes purchased. The Terms Agreement shall also specify
the requirements for the officer's certificate, opinions of counsel and comfort
letter pursuant to Sections 7(b), 7(c) and 7(d) hereof and, if applicable, the
period of time referred to in Section 4(g). With respect to any Notes purchased
by an Agent as principal pursuant to a Terms Agreement that have not been
resold by such Agent prior to the earlier of (i) the 90th day following the
related Settlement Time and (ii) a date specified in an applicable Terms
Agreement, such Agent agrees (and by entering into such Terms Agreement shall
be deemed to have reconfirmed such agreement) that upon receipt of written
notice from the Company of its intention to bid for or purchase any Notes or
any security of the same class and series as the Notes or to take any other
action, directly or indirectly, the taking of which would be proscribed by Rule
l0b-6 under the 1934 Act (or any successor or equivalent rule or regulation)
during the reoffering of the Notes, such Agent will, and will cause any selling
or dealer group utilized by it in connection with such reoffering, to cease
reoffering such Notes for such period of time as the Company may deem necessary
so that the action or actions proposed to be taken, directly or indirectly, by
it may be taken in full compliance with such Rule (or any successor or
equivalent rule or regulation).
(c) Administrative Procedures. Administrative procedures with respect to the
sale of Notes shall be agreed upon from time to time by the Agents and the
Company (the "Administrative Procedures"). The Agents and the Company agree to
perform the respective duties and obligations specifically provided to be
performed by them in the Administrative Procedures.
Section 4. Covenants of the Company. The Company covenants with each Agent as
follows:
(a) Notice of Certain Events. Prior to the termination of the offering of
the Notes, the Company will notify the Agents promptly, and (if requested
by the Agents in writing) will confirm such advice in writing, (1) of the
effectiveness of any amendment to the Registration Statement and of the
filing of any supplement to the Prospectus (other than an Excluded
Supplement or an amendment or supplement providing solely for the inclusion
of additional financial information, and, unless the Agents shall otherwise
specify, an amendment or supplement which relates exclusively to an
offering of Securities other than the Notes), (2) of any comments of the
Commission regarding the Registration Statement or the Prospectus (or any
of the documents incorporated by reference therein) or of any request by
the Commission for amendments or
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supplements to the Registration Statement or the Prospectus or for
additional information, (3) of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or the
initiation or threatening of any proceedings for that purpose, (4) of the
receipt by the Company of any notification with respect to the suspension
of the qualification of the Notes for offer or sale in any jurisdiction or
the initiation or threatening of any proceedings for such purpose and (5)
of the happening of any event during the period mentioned in paragraph (d)
below which makes any statement of a material fact made in the Registration
Statement or the Prospectus untrue or which requires the making of any
changes in the Registration Statement or the Prospectus in order to make
the statements therein, in light of the circumstances when the Prospectus
is delivered to a purchaser, not misleading. Upon receipt of notice of an
event described in (3), (4) or (5) above, the Agents shall cease
solicitations of offers to purchase the Notes, as agent, and cease sales of
Notes the Agents may own as principal; provided, however, that if such
cessation arises out of an event described in (4) above, it shall be
limited to cessation of solicitation of offers to purchase and sales in the
jurisdiction or jurisdictions identified in such notice. The Company will
use its reasonable best efforts to prevent the issuance of any order
suspending the effectiveness of the Registration Statement or suspending
the qualification of the Notes for offer or sale in any jurisdiction, and
if any such order is issued, the Company will make every reasonable effort
to obtain the withdrawal of such order at the earliest possible moment.
(b) Executed Registration Statement. The Company will furnish to each of
the Agents, without charge, one signed copy of the Registration Statement
and any post-effective amendment thereto, including all financial
statements and schedules, exhibits and documents incorporated therein by
reference (including exhibits incorporated therein by reference to the
extent not previously furnished to the Agents).
(c) Notice of Certain Proposed Filings. Prior to the termination of the
offering of the Notes, the Company will not file any amendment or
supplement to the Registration Statement or the Prospectus (except for (i)
periodic or current reports filed under the 1934 Act, (ii) an Excluded
Supplement, or (iii) a supplement relating to an offering of Securities
other than the Notes) unless the Company has furnished each Agent a copy
for its review prior to filing such proposed amendment or supplement.
(d) Copies; Revisions of Prospectus--Material Changes. During the period
of time that the Prospectus is required by law to be delivered, the Company
will deliver to the Agents, without charge, as many copies of the
Prospectus, as amended or supplemented, as the Agents may reasonably
request. The Company consents to the use of the then current Prospectus, as
amended or supplemented, by the Agents in connection with the offering or
sale of the Notes and for such period of time thereafter as the Prospectus
is required by law to be delivered in connection therewith. If during such
period of time, any event shall occur which in the judgment of the Company
should be set forth (or incorporated by reference) in the Prospectus in
order to make the statements therein, in light of the circumstances when
the Prospectus is delivered to a purchaser, not misleading, or if it is
necessary to supplement the Prospectus or amend the Registration Statement
to comply with law, immediate notice shall be given by the Company, and
confirmed in writing, to the Agents to cease the solicitation of offers to
purchase the Notes in the Agents' capacity as agents and to cease sales of
any Notes the Agents may then own as principals pursuant to a Terms
Agreement (and, if so notified by the Company, each Agent shall forthwith
cease such solicitations and sales), and the Company will forthwith prepare
and duly file with the Commission an appropriate supplement or amendment
thereto, and forthwith file all reports and any definitive proxy statement
or information statement required to be filed by the Company with the
Commission pursuant to Section 13 or 14 of the 1934 Act subsequent to, the
date of the Prospectus, and will deliver to the Agents, without charge,
such number of copies thereof as they may reasonably request. If during
such period of time any event shall occur which in the Agents' judgment
should be so set forth (or incorporated by reference), in the Prospectus,
or which in the Agents' judgment makes it necessary to so supplement or
amend the Prospectus, the Company will consult with the Agents concerning
the necessity of filing with the Commission a supplement or an amendment to
the Prospectus or a report pursuant to Section 13 or 14 of the 1934 Act.
(e) Blue Sky. Prior to any public offering of the Notes by the Agents,
the Company will cooperate with the Agents and counsel for the Agents in
connection with the registration or qualification of the Notes
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for offer and sale under the securities or Blue Sky laws of, and the
determination of the eligibility of the Notes for investment under the laws
of, such jurisdictions as the Agents request; provided, that in no event
shall the Company be obligated to qualify to do business as a foreign
corporation or as a securities dealer in any jurisdiction where it is not
now so qualified, to conform its capitalization or the composition of its
assets to the securities or Blue Sky laws of any jurisdiction or to take
any action which would subject it to taxation or general service of process
in any jurisdiction where it is not now so subject. The Company will pay
all reasonable fees and expenses (including reasonable counsel, fees and
expenses) relating to qualification of the Notes under such securities or
Blue Sky laws and in connection with the determination of the eligibility
of the Notes for investment under the laws of such jurisdictions as the
Agents may designate.
(f) Earnings Statements. The Company will make generally available to its
security holders and to the Agents consolidated earnings statements (which
need not be audited) that satisfy the provisions of Section 11(a) of the
1933 Act and Rule 158 thereunder.
(g) Stand-Off Agreement. Between the date of any Terms Agreement and the
Settlement Time or such other time as is specified in the Terms Agreement,
the Company will not offer or sell, or contract to sell, any substantially
similar debt securities of the Company to those issued pursuant to the
Terms Agreement, which may include substantially similar Notes, pursuant to
a public offering of such similar debt securities without the prior written
consent of the Agent party to such Terms Agreement which, shall not be
unreasonably withheld.
(h) Preparation of Pricing Supplements. The Company will prepare, with
respect to each Note to be sold through or to an Agent pursuant to this
Agreement, a pricing supplement with respect to such Notes in a general
form previously approved by the Agents, and will file such pricing
supplement pursuant to the applicable paragraph of Rule 424(b) under the
1933 Act within the time period therein prescribed.
(i) Suspension of Certain Obligations. The Company shall not be required
to comply with the provisions of subsections (b), (c) or (d) of this
Section during any period from the time (i) any Agent shall have suspended
solicitation of purchases of the Notes in its capacity as agent pursuant to
a request from the Company and (ii) any Agent shall not then hold any Notes
as a principal, purchased pursuant to a Terms Agreement, to the time the
Company shall determine that solicitation of purchases of the Notes should
be resumed or shall subsequently enter into a new Terms Agreement with an
Agent.
Section 5. Conditions of Obligations. The obligations of each Agent to solicit
offers to purchase the Notes as agent of the Company, the obligations of any
purchasers of the Notes sold through an Agent as agent, and any obligation of
an Agent to, purchase Notes pursuant to a Terms Agreement will be subject to
the accuracy of the representations and warranties on the part of the Company
contained in Section 2 hereof and in any certificate furnished pursuant to the
provisions hereof, to the performance and observance by the Company of all of
its covenants and agreements herein contained and to the following additional
conditions precedent:
(a) Legal Opinions. On the date hereof, the Agents shall have received:
(1) The favorable opinions, dated as of the date hereof, from (A) special
communications counsel for the Company with respect to matters of
communications law, and (B) General Counsel of the Company, in form and
substance satisfactory to the Agents, to the effect that:
(i) the Company and each of its Significant Subsidiaries is a
corporation duly incorporated, validly existing and in good standing
under the laws of the jurisdiction of its incorporation and has the
corporate power and authority to carry on its business as described in
the Prospectus and the Company has the corporate power and authority to
execute and deliver and perform its obligations under this Agreement
and to issue and sell the Notes as contemplated by this Agreement;
(ii) the Company and each of its Significant Subsidiaries is duly
qualified as a foreign corporation and is in good standing in each
jurisdiction in which the failure to so qualify would, in the
aggregate, have a material adverse effect upon the financial condition,
results of operations, business or properties of the Company and its
consolidated subsidiaries taken as a whole;
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(iii) all corporate proceedings legally required in connection with
the authorization and issuance of the Notes and the sale of the Notes
by the Company in accordance with the terms of this Agreement have been
taken;
(iv) to the best knowledge of such counsel, there is no legal or
governmental proceeding pending or threatened against the Company or
any of its subsidiaries which is required to be disclosed in the
Prospectus and is not so disclosed and correctly summarized therein;
(v) to the best knowledge of such counsel, there is no contract or
other document known to such counsel of a character required to be
described in the Prospectus or to be filed as an exhibit to the
Registration Statement (or to a document incorporated by reference
therein) that is not described or filed as required;
(vi) the execution and delivery of this Agreement and the Indenture,
the issuance of the Notes and the fulfillment of the terms herein and
therein contained do not conflict with, or result in a breach of, or
constitute a default under, the charter or by-laws of the Company or,
to the best knowledge of such counsel, conflict in any material respect
with, or result in a material breach of or constitute a material
default under any material agreement or other instrument known to such
counsel to which the Company or any of its Significant Subsidiaries is
a party or by which it is bound, or result in a violation of any law,
administrative regulation or court or governmental decree known to such
counsel applicable to the Company or any of its subsidiaries, except
that such counsel need not express any opinion with respect to (i)
matters opined upon by other special counsel to the Company or (ii) the
Blue Sky or securities laws of any jurisdiction; and
(vii) such counsel has no reason to believe that either the
Registration Statement or the Prospectus, as amended or supplemented,
if applicable (except as to financial statements and schedules and any
other financial and statistical data contained or incorporated by
reference in the Registration Statement or Prospectus, as to which no
opinion need be expressed), contained, as of the date the Prospectus
was first filed with the Commission pursuant to Rule 424 under the 1933
Act, or contains, as of the date hereof, or (if such opinion is being
delivered in connection with, a Terms Agreement pursuant to Section
7(c) hereof, at the date of such Terms Agreement and at the Settlement
Time with regard thereto, as the case may be), any untrue statement of
a material fact or omitted or omits to state any material fact required
to be stated therein or necessary to make the statements therein (in
the case of the Prospectus, in light of the circumstances under which
they were made) not misleading.
(2) The favorable opinion, dated as of the date hereof, from special
counsel to the Company, in form and substance satisfactory to the Agents,
to the effect that:
(i) the execution and delivery of this Agreement and the Indenture,
the issuance of the Notes and the fulfillment of the terms herein and
therein contained do not, to the best knowledge of such counsel, result
in a material breach of or constitute a material default under any
material agreement for borrowed money known to such counsel to which
the Company or any of its Significant Subsidiaries is a party or by
which it is bound, and
(ii) the Company is not an "investment company" within the meaning of
the Investment Company Act of 1940, as amended, and is not subject to
regulation under such Act.
(3) The favorable opinion, dated as of the date hereof, from special
counsel to the Company, in form and substance satisfactory to the Agents,
to the effect that:
(i) this Agreement and the Indenture have been duly authorized,
executed and delivered by the Company; and the Indenture is a legal,
valid and binding agreement of the Company enforceable in accordance
with its terms, except (A) as such enforceability may be limited by
bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium and other laws affecting creditors' rights generally, and
(B) that the remedy of specific performance and injunctive and other
forms of equitable relief are subject to certain equitable defenses and
to the discretion of the court before which any proceeding therefor may
be brought;
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(ii) the Indenture has been duly qualified under, and complies in all
material respects with the requirements of, the 1939 Act;
(iii) the Notes, when executed by the Company, completed,
authenticated and delivered by the Trustee in accordance with the
Indenture, issued and delivered by the Company and paid for, all as
contemplated by and in accordance with the order of the Company, the
procedures specified therein and this Agreement, will be legal, valid
and binding obligations of the Company entitled to the benefits of the
Indenture and enforceable in accordance with their terms, except (A) as
such enforceability may be limited by bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium and other laws
affecting creditors, rights generally, and (B) that the remedy of
specific performance and injunctive and other forms of equitable relief
are subject to certain equitable defenses and to the discretion of the
court before which any proceeding therefor may be brought;
(iv) the Registration Statement is effective under the 1933 Act and,
to the best knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceeding for that purpose is pending or threatened by the Commission;
and
(v) the Notes (subject to completion in accordance with the
applicable pricing supplement) and the Indenture conform in all
material respects as to legal matters to the descriptions thereof in
the Prospectus.
In addition, such counsel shall state that: "The Registration Statement and
the Prospectus (except as to (x) the financial statements and schedules and any
other financial and statistical data contained or incorporated by reference
therein and (y) the documents incorporated or deemed to be incorporated by
reference therein, as to which no opinion is expressed), comply as of the date
hereof, as to form in all material respects with the requirements of the 1933
Act and the 1933 Act Regulations. In passing upon the form of such documents,
we have necessarily assumed the correctness and completeness of the statements
made or included therein by the Company and take no responsibility for the
accuracy, completeness or fairness of the statements contained therein except
insofar as such statements relate to the description of the Notes and the
Indenture or relate to us. However, we had conferences with certain officers
and other representatives of the Company, and our examination of the
Registration Statement and the Prospectus and our discussions in such
conferences did not disclose to us any information (relying as to the
materiality of any such information primarily upon officers and other
representatives of the Company) which gave us reason to believe that either the
Registration Statement or the Prospectus (except as to (x) the financial
statements and schedules and any other financial and statistical data contained
or incorporated by reference in the Registration Statement or Prospectus and
(y) the documents incorporated or deemed to be incorporated by reference
therein, as to which no opinion is expressed, and except as to the terms of the
particular Notes which are to be provided in the pricing supplement), contains,
as of the date hereof, any untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to make the
statements therein (in the case of the Prospectus, in light of the
circumstances under which they were made) not misleading."
In giving such opinions, such counsel may rely (x) as to matters of fact, to
the extent they deem proper, upon certificates of officers of the Company,
public officials and others, and (y) as to matters of law other than the United
States or Colorado (in the case of General Counsel of the Company) or New York
(in the case of special counsel to the Company), on the opinions of local
counsel retained by them or the Company, provided that such counsel are
satisfactory to the Agents and counsel for the Agents. In addition, it is
understood that the General Counsel of the Company may elect to provide
favorable opinions with respect to the matters set forth in clause (i) of
subsection (a)(2) of this Section and clause (iv) of subsection (a)(3) of this
Section in lieu of special counsel to the Company providing such opinions.
(4) The favorable opinion, dated as of the date hereof, of counsel for
the Agents, with respect to the matters set forth in clauses (i) and (iii)
of subsection (a)(3) of this Section and to the effect that the
Registration Statement and the Prospectus (except as to (x) the financial
statements and schedules and any other financial and statistical data
contained or incorporated by reference therein and (y) the documents
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incorporated or deemed to be incorporated by reference therein, as to which
no opinion need be expressed) comply as to form in all material respects
with the 1933 Act. In addition, the Agents shall have received on the date
hereof from counsel for the Agents, an opinion with respect to the
Registration Statement and the Prospectus in the form customarily given by
such firm.
(b) Material Changes; Officer's Certificates. On the date hereof there
shall not have been, since the respective dates as of which information is
given in the Registration Statement, any material adverse change or any
development resulting in the substantial possibility of a prospective
material adverse change in the condition, financial or otherwise, of the
Company and its consolidated subsidiaries considered as one enterprise, or
in the-earnings or business affairs of the Company and its consolidated
subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, and the Agents shall have received a
certificate of the President, the Principal Financial Officer, the Senior
Vice President--Finance, Treasurer or the Assistant Treasurer of the
Company dated as of the date hereof, to the effect that (i) there has been
no such material adverse change with respect to the Company and its
consolidated subsidiaries considered as a whole, (ii) no stop order
suspending the effectiveness of the Registration Statement has been issued
and no proceedings for that purpose are pending or threatened by the
Commission, (iii) the representations and warranties of the Company
contained in Section 2 are true and correct as of the date hereof, and (iv)
the Company has performed or complied with all agreements and satisfied all
conditions pursuant to this Agreement in connection with the issuance of
the Notes on its part to be performed or satisfied at or prior to the date
of such certificate.
(c) Comfort Letter. On the date hereof, the Agents shall have received
from KPMG Peat Marwick LLP or its successors or other independent certified
public accountants acceptable to the Agents a letter, dated as of the date
hereof, in form and substance reasonably satisfactory to the Agents.
(d) Other Matters. At each Settlement Time with respect to any Terms
Agreement, counsel for the Agents shall have been furnished with such
documents and opinions as they may reasonably require for the purpose of
enabling them to pass upon the issuance and sale of the Notes as therein
contemplated and related proceedings or in order to evidence the accuracy
and completeness of any of the representations and warranties, or the
fulfillment of any of the conditions, herein contained. All proceedings
taken by the Company in connection with the issuance and sale of the Notes
as herein contemplated shall be satisfactory in form and substance to the
Agents.
If any condition specified in this Section 5 shall not have been fulfilled
when and as required to be fulfilled, this Agreement (or, at the option of the
applicable Agent, any Terms Agreement) may be terminated by an Agent by notice
to the Company at any time (or, in the case of termination of a Terms
Agreement, at or at any time prior to the Settlement Time) and any such
termination shall be with the effect set forth in Section 12(c).
Section 6. Delivery of and Payment for Notes Sold through an Agent. Delivery of
Notes sold through an Agent as agent shall be made by the Company to the Agent
for the account of any purchaser only against payment therefor in immediately
available funds. In the event that a purchaser shall fail either to accept
delivery of, or to make payment for, a Note on the date fixed for settlement,
the Agent that solicited such purchaser shall promptly notify the Company and
deliver the Note to the Company, and, if the Agent has theretofore paid the
Company for such Note, the Company will return such funds to the Agent within
three business days. If such failure occurred for any reason other than default
by the Agent in the performance of its obligations hereunder, the Company will
reimburse the Agent for its loss of the use of the funds for the period such
funds were credited to the Company's account. Such reimbursement shall be in an
amount equal to the lower of the Company's cost of funds and the Agent's cost
of funds.
Section 7. Additional Covenants of the Company. The Company covenants and
agrees with the Agents that:
(a) Reaffirmation of Representations and Warranties. Each acceptance by
it of an offer for the purchase of Notes, and each delivery of Notes to an
Agent pursuant to a Terms Agreement, shall be deemed to be an affirmation
that the representations and warranties of the Company contained in Section
2 of this
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Agreement and in any certificate theretofore delivered to such Agent
pursuant hereto are true and correct at the time of such acceptance or
sale, as the case may be, and an undertaking that such representations and
warranties will be true and correct at the time of delivery to the
purchaser or his agent, or to such Agent, of the Note or Notes relating to
such acceptance or sale, as the case may be, as though made at and, as of
each such time (and it is understood that such representations and
warranties shall relate to the Registration Statement and Prospectus as
amended and supplemented to each such time);
(b) Subsequent Delivery of Certificates. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented
(other than by an Excluded Supplement or by an amendment or supplement
providing solely for the inclusion of additional financial information, or,
unless the Agents shall otherwise specify, other than by an amendment or
supplement which relates exclusively to an offering of Securities other
than the Notes), or (ii) there is filed with the Commission any Report on
Form 10-K, or (iii) there is filed with the Commission any document
incorporated by reference into the Prospectus (other than any Current
Report on Form 8-K), or (iv) there is filed with the Commission any Current
Report on Form 8-K containing information that is reasonably deemed to be
materially adverse to the business affairs or prospects of the Company, or
(v) (if required pursuant to the terms of a Terms Agreement) the Company
sells Notes to an Agent pursuant to a Terms Agreement, the Company shall
furnish or cause to be furnished to the Agents forthwith a certificate
dated the date of filing with the Commission of such supplement or
document, the date of effectiveness of such amendment, or the date of such
sale, as the case may be, in form satisfactory to the Agent to the effect
that the statements contained in the certificate of the Company referred to
in Section 5(b) hereof which was last furnished to the Agent are true and
correct at the time of such amendment, supplement, filing or sale, as the
case may be, as though made at and as of such time (except that such
statements shall be deemed to relate to the Registration Statement and the
Prospectus as amended and supplemented to such time) or, in lieu of such
certificate, a certificate of the same tenor as the certificate referred to
in said Section 5(b), modified as necessary to relate to the Registration
Statement and the Prospectus as amended and supplemented to the time of
delivery of such certificate. In the case of certificates to be furnished
pursuant to (iii) or (iv) above, the Company may request that the Agents
waive the requirement for the certificates, which request shall not be
unreasonably refused;
(c) Subsequent Delivery of Legal Opinions. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented
(other than by an Excluded Supplement or by an amendment or supplement
providing solely for the inclusion of additional financial information, or,
unless the Agents shall otherwise specify, other than by an amendment or
supplement which relates exclusively to an offering of Securities other
than the Notes), (ii) there is filed with the Commission any Report on Form
10-K, (iii) there is filed with the Commission any document incorporated by
reference into the Prospectus (other than any Current Report on Form 8-K or
a Report on Form 10-Q), (iv) there is filed with the Commission any Current
Report on Form 8-K containing information that is reasonably deemed to be
materially adverse to the business affairs or prospects of the Company or
(v) (if required pursuant to the terms of a Terms Agreement) the Company
sells Notes to an Agent pursuant to a Terms Agreement, the Company shall
furnish or cause to be furnished forthwith to the Agents and to counsel to
the Agents the written opinions of the General Counsel of the Company and
special counsel to the Company or other counsel satisfactory to the Agent
dated the date of filing with the Commission of such supplement or
document, the date of effectiveness of such amendment, or the date of such
sale, as the case may be, in form and substance satisfactory to the Agents,
of the same tenor as the opinions referred to in Section 5(a)(1)(B) and
5(a)(3) hereof, but modified, as necessary, to relate to the Registration
Statement and the Prospectus as amended and supplemented to the time of
delivery of such opinions, or (vi) in lieu of any such opinion required
under Subsection (7)(c)(v) above, counsel last furnishing such opinion to
the Agents, shall furnish the Agents with a letter to the effect that the
Agents may rely on such last opinion to the same extent as though it was
dated the date of such letter authorizing reliance (except that statements
in such last opinion shall be deemed to relate to the Registration
Statement and the Prospectus as amended and supplemented to the time of
delivery of such letter authorizing reliance). In the case of opinions to
be furnished pursuant to (iii) or (iv) above, the Company may request that
Agents waive the requirement for the opinions, which request shall not be
unreasonably refused; and
11
<PAGE>
(d) Subsequent Delivery of Comfort Letters. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented
to include additional financial information, (ii) there is filed with the
Commission any Report on Form 10-K, (iii) there is filed with the
Commission any document incorporated by reference to the Prospectus which
contains additional financial information (other than any Current Report on
Form 8-K), (iv) there is filed with the Commission any Current Report on
Form 8-K (containing additional information) which contains information
that is reasonably deemed to be materially adverse to the business affairs
or prospects of the Company, or (v) (if required pursuant to the terms of a
Terms Agreement) the Company sells Notes to an Agent pursuant to a Terms
Agreement, the Company shall cause KPMG Peat Marwick LLP or its successors
forthwith to furnish the Agents a letter, dated the date of filing with the
Commission of such amendment, supplement or document, the date of
effectiveness of such amendment, or the date of such sale, as the case may
be, in form satisfactory to the Agents, of the same tenor as the portions
of the letter delivered pursuant to Section 5(c) but modified to relate to
the Registration Statement and Prospectus, as amended and supplemented to
the date of such letter, and as may be necessary to reflect changes in the
financial statements and other information derived from the accounting
records of the Company; provided, however, that if the Registration
Statement or the Prospectus is amended or supplemented solely to include
the financial information as of and for an interim period, KPMG Peat
Marwick LLP or its successors may limit the scope of such letter to the
unaudited financial statements included in such amendment or supplement
unless any other information included therein of an accounting, financial
or statistical nature is of such a nature that, in the reasonable judgment
of the Agents, such letter should cover such other information, and
provided, further, that the delivery of such letter by KPMG Peat Marwick
LLP (or its successors) shall be conditioned upon the receipt by KPMG Peat
Marwick LLP (or its successors) of an opinion of counsel for the Agents, in
form and substance reasonably satisfactory to KPMG Peat Marwick LLP (or
such successor) . In the case of letters to be furnished pursuant to (iii)
or (iv) above, the Company may request that the Agents waive the
requirement for the letters, which request shall not be unreasonably
refused.
Section 8. Payment of Expenses. The Company agrees to pay all expenses incident
to the performance of its obligations under this Agreement, including:
(a) the preparation and filing of the Registration Statement and all
amendments thereto and the Prospectus and any amendments or supplements
thereto;
(b) the preparation, filing and reproduction of this Agreement;
(c) the preparation, printing, and issuance and delivery of the Notes,
including any fees and expenses relating to the use of book-entry notes
(excluding any fees payable by an Agent solely as member of The Depository
Trust Company);
(d) the fees and disbursements of the Company's accountants and counsel,
of the Trustee and its counsel, and of any Calculation Agent or Exchange
Rate Agent;
(e) the reasonable fees and disbursements of counsel to the Agents
incurred from time to time in connection with the transactions contemplated
hereby;
(f) the qualification of the Notes under state securities laws in
accordance with the provisions of Section 4(e) hereof, including filing
fees and the reasonable fees and disbursements of counsel for the Agents in
connection therewith and in connection with the preparation of any Blue Sky
Survey and any Legal Investment Survey;
(g) the printing and delivery to the Agents in quantities as hereinabove
stated of copies of the Registration Statement and any amendments thereto,
and of the Prospectus and any amendment or supplements thereto, and the
delivery by the Agents of the Prospectus and any amendments or supplements
thereto in connection with solicitations or confirmations of sales of the
Notes;
(h) the preparation, printing, reproducing and delivery to the Agents of
copies of the Indenture and all supplements and amendments thereto;
12
<PAGE>
(i) any fees charged by rating agencies for the rating of the Notes;
(j) the fees and expenses incurred in connection with the listing of the
Notes on any securities exchange;
(k) the fees and expenses, if any, incurred with respect to any filing
with the National Association of Securities Dealers, Inc.;
(l) any advertising and other out-of-pocket expenses of an Agent incurred
with the approval of the Company; and
(m) the fees and expenses of any Depository (as defined in the Indenture)
and any nominees thereof in connection with Notes.
Section 9. Indemnification. The Company agrees to indemnify and hold harmless
each Agent, and each person, if any, who controls each Agent within the meaning
of either Section 15 of the 1933 Act or Section 20 of the 1934 Act, from and
against any and all losses, claims, damages, liabilities and expenses
(including reasonable costs of investigation), as incurred, arising out of or
based upon any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or the Prospectus or in any amendment
or supplement thereto or in any preliminary prospectus, or arising out of or
based upon any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading, except
insofar as such losses, claims, damages, liabilities or expenses arise out of
or are based upon any such untrue statement or omission or allegation thereof
based upon information furnished in writing to the Company by such Agent
expressly for use, therein; provided, however, the Company shall not indemnify
such Agent or any person who controls such Agent from any such losses, claims,
damages or liabilities alleged by any person who purchased Notes from such
Agent if the untrue statement, omission or allegation thereof upon which such
losses, claims, damages or liabilities are based was made in: (i) any
preliminary prospectus or Prospectus, if a copy of the Prospectus, or the
Prospectus as then amended or supplemented (if the Company shall have furnished
any amendments or supplements thereto), as the case may be, was not sent or
given by or on behalf of such Agent to such person at or prior to the written
confirmation of the sale of the Notes to such person, and if the Prospectus, or
the Prospectus as so amended or supplemented, as the case may be, corrected the
untrue statement or omission giving rise to such loss, claim, damage or
liability; (ii) any Prospectus used by such Agent (or any broker or dealer
appointed or engaged by such Agent) or any person who controls such Agent,
after such time as the Company advised such Agent that the filing of a post-
effective amendment or supplement thereto was required, except the Prospectus
as so amended or supplemented; or (iii) any Prospectus used by such Agent (or
any broker or dealer appointed or engaged by such Agent) or any person who
controls such Agent, after the termination of the offering of the Notes. This
indemnity will be in addition to any liability which the Company may otherwise
have.
If any action or proceeding (including any governmental investigation) shall
be brought or asserted against an Agent or any person controlling an Agent in
respect of which indemnity may be sought from the Company, such Agent or such
controlling person shall promptly notify the Company in writing, and the
Company shall assume the defense thereof, including the employment of counsel
reasonably satisfactory to the Agent's party to such action or proceeding and
the payment of all expenses. Any omission so to notify the Company shall not,
however, relieve the Company from any liability which it may have to any
indemnified party otherwise than under this Section 9. Such Agent or any such
controlling person shall have the right to employ separate counsel in any such
action or proceeding and to participate in the defense thereof, but the fees
and expenses of such separate counsel shall be such Agent's expense or the
expense of such controlling person unless (a) the Company has agreed to pay
such fees and expenses, (b) the Company shall have failed to assume the defense
of such action or proceeding and employ counsel reasonably satisfactory to the
Agents in any such action or proceeding or (c) the named parties to any such
action or proceeding (including any impleaded parties) include an Agent or any
such controlling person and the Company, and such Agent or such controlling
person shall have been advised by such counsel that there may be a conflict of
interest between such Agent or such controlling person and the
13
<PAGE>
Company in the conduct of the defense of such action (in which case, if such
Agent or such controlling person notifies the Company in writing that it elects
to employ separate counsel at the expense of the Company, the Company shall not
have the right to assume the defense of such action or proceeding on such
Agent's behalf or on behalf of such controlling person, it being understood,
however, that the Company shall not, in connection with anyone such action or
proceeding or separate but substantially similar or related actions or
proceedings arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of more than one separate firm of
attorneys (unless the members of such firm are not admitted to practice in a
jurisdiction where an action is pending, in which case the Company shall pay
the reasonable fees and expenses of one additional firm of attorneys to act as
local counsel in such jurisdiction, provided the services of such counsel are
substantially limited to that of appearing as attorneys of record) at any time
for all indemnified parties, which firm shall be designated in writing by such
Agent). The Company shall not be liable for any settlement of any such action
or proceeding effected without its written consent, but if settled with its
written consent, or if there be a final judgment for the plaintiff if any such
action or proceeding, the Company agrees to indemnify and hold harmless the
Agent and any such controlling person from and against any loss or liability by
reason of such settlement or judgment.
Each Agent agrees to indemnify and hold harmless the Company, its directors
and each of its officers, and each person, if any, who controls the Company
within the meaning of either Section 15 of the 1933 Act or Section 20 of the
1934 Act, to the same extent as the foregoing indemnity from the Company to the
Agents, but only with respect to information furnished in writing by such Agent
expressly for use in the Registration Statement, the Prospectus, or any
amendment or supplement thereto, or any preliminary prospectus, or any
amendment or supplement thereto, or any preliminary prospectus. In case any
action or proceeding shall be brought against the Company or its directors or
officers or any such controlling person, in respect of which indemnity may be
sought against an Agent, such Agent shall have the rights and duties given to
the Company, and the Company or its directors or officers or such controlling
person shall have the rights and duties given by the Agents, by the preceding
paragraph.
Section 10. Contribution. If the indemnification provided for in Section 9 is
unavailable to an indemnified party under the first or third paragraph thereof
in respect of any losses, claims, damages or liabilities referred to therein
(other than by reason of such indemnified party's failure to comply with the
first sentence of the second paragraph of Section 9), 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 or liabilities, as incurred (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and by each Agent on the other hand from the offering
of the Notes to which such loss, claim, damage or liability (or action in
respect thereof) relates, or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company on the one hand and of each Agent on the
other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and by each Agent on the other in connection with the offering of the Notes
shall be deemed to be such that each Agent shall be responsible for the
aggregate losses, claims, damages and liabilities represented by the percentage
that the total underwriting discounts and agency commissions received by such
Agent with respect to the Notes giving rise to such losses, claims, damages or
liabilities bears to the total net proceeds for the sale of such Notes, and the
Company shall be responsible for the balance. The relative fault of the Company
shall be responsible for the balance. The relative fault of the Company on the
one hand of each Agent on the other 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 each Agent 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 and liabilities referred to above shall be
deemed to include, subject to the limitations set forth in the second paragraph
of Section 9, any legal or other fees or expenses reasonably incurred by such
party in connection with investigating or defending any action or claim.
14
<PAGE>
The Company and each Agent agree that it would not be just and equitable if
contribution pursuant to this Section 10 were determined by pro rata allocation
or by any other method of allocation which does not take account of the
equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 10, each Agent shall not be
required to contribute any amount in excess of the amount by which the total
price at which the Notes were offered to the public exceeds the amount of any
damages which such Agent has otherwise been required to pay be reason of such
untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933
Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation.
Section 11. Representations, Warranties and Agreements to Survive Delivery. All
representations, warranties and agreements contained in this Agreement by the
Company and the Agents, or contained in certificates of executive officers of
the Company submitted pursuant hereto, shall remain operative and in full force
and effect regardless of any investigation made by or on behalf of any Agent or
controlling person, or by or on behalf of the Company, and shall survive each
delivery of and payment for any Notes.
Section 12. Termination.
(a) Termination of this Agreement. This Agreement (excluding any Terms
Agreement) may be terminated for any reason, at any time by the Company with
respect to any of the Agents, and any Agent may resign as Agent hereunder, upon
the giving of 1 day written notice of such termination to the other parties
hereto; provided, however, that in the event this Agreement is terminated with
respect to only one of the Agents, this Agreement shall remain in full force
and effect between the Company and other Agents.
(b) Termination of a Terms Agreement. An Agent may terminate any Terms
Agreement between such Agent and the Company, immediately upon notice to the
Company, at any time at or prior to the Settlement Time relating thereto (i) if
there has been since the date of the Terms Agreement or since the respective
dates as of which information is given in the Prospectus (as amended or
supplemented to the date of the Terms Agreement), any material adverse change
in the condition, financial or otherwise, of the Company and its consolidated
subsidiaries considered as one enterprise, or in the earnings, business affairs
or business prospects of the Company and its consolidated subsidiaries
considered as one enterprise, whether not arising in the ordinary course of
business, (ii) if there shall have occurred any material adverse change in the
financial markets in the United States or any outbreak or escalation of
hostilities or other national or international calamity or crisis the effect of
which on the financial markets of the United States is such as to make it, in
the judgment if such Agent, impracticable to market the Notes or enforce
contracts for the sale of the Notes, (iii) if the rating assigned by any
nationally recognized securities rating agency in the United States to any debt
securities of the Company as of the date of the Terms Agreement or if any such
rating agency shall have publicly announced that it has placed any debt
securities of the Company on what is commonly termed a "watch list" for
possible downgrading, or (iv) if there shall have come to such Agent's
attention any facts that would cause such Agent reasonably to believe that the
Prospectus contains an untrue statement of a material fact or omits to state a
material fact necessary in order to make the statements therein, in the light
of the circumstances then existing, not misleading.
(c) General. In the event of any such termination pursuant to subsection (a)
or (b) above or Section 5 hereof, the resigning or terminating party will have
no liability to the other parties hereto and no other remaining party hereto
will have any liability to the resigning or terminating party, except that (i)
each Agent shall be entitled to any commission earned in accordance with the
third paragraph of Section 3(a) hereof, (ii) if at the time of termination by
the Company (a) an Agent shall own any Notes purchased pursuant to a Terms
Agreement with the intention of reselling them or (b) an offer to purchase any
of the Notes has been accepted by the Company but the time of delivery to the
purchaser or his agent of the Note or Notes relating thereto has not occurred,
the covenants set forth in Sections 4 and 7 hereof shall remain in effect until
(i) the earlier of the date such Notes are so resold or at the 90th day
following the related Settlement Time or (ii) such Notes are delivered, as the
case may be, and (iii) the last sentence of Section 3(b), the covenant
regarding provision of an earnings statement set forth in Section 4(f) hereof,
the provisions concerning payment of expenses set forth in Section
15
<PAGE>
4(e) and Section 8 hereof, the indemnity and contribution agreements set forth
in Section 9 and 10 hereof and the provisions of Section 11 (but only as such
Sections relates to representations and warranties) and Section 14 hereof shall
remain effect.
Section 13. Notices. Unless otherwise provided herein, all notices required
under the terms and provisions hereof shall be in writing, either delivered by
hand, by mail or by telex, telecopier or telegram, and any such notice shall be
effective when received it the address specified below.
If to the Company:
TCI Communications, Inc.
Terrace Tower II
5619 DTC Parkway
Englewood, Colorado 80111-3000
Attention:Bernard W. Schotters
Telephone:(303) 267-5500
Facsimile:(303) 488-3200
with a copy (similarly addressed) to the attention of the General Counsel.
If to the Agents:
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
North Tower--10th Floor
World Financial Center
New York, New York 10281-1310
Attention:MTN Product Management
Telephone:(212) 449-7476
Facsimile:(212) 449-2234
or, as the case may be,
CS First Boston Corporation
Park Avenue Plaza
55 East 52nd Street, 35th Floor
New York, New York 10055
Attention:New Issue Processing,
Joseph D. Fashano
Telephone:(212) 909-2107
Facsimile:(212) 318-0532
or, as the case may be,
Lehman Brothers
American Express Tower
World Financial Center
New York, New York 10285-1800
Attention:Medium-Term Note Department
Telephone:(212) 640-8400
Facsimile:(212) 528-7035
16
<PAGE>
or, as the case may be,
Salomon Brothers Inc.
Seven World Trade Center
New York, New York 10048
Attention:Medium-Term Note Department
Telephone:(212) 783-6848
Facsimile:(212) 783-3350
or at such other address as such party may designate from time to time by
notice duly given in accordance with the terms of this Section 13.
Section 14. Parties. This Agreement shall inure to the benefit of and be
binding upon the Agents and the Company, and their respective successors.
Nothing expressed or mentioned in any Terms Agreement or this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the parties hereto or thereto and their respective successors and the
controlling persons and officers and directors referred to in Sections 9 and 10
and their heirs and legal representatives, any legal or equitable right, remedy
or claim under, or in respect of, this Agreement or any provision herein
contained. This Agreement and all conditions and provisions thereof and hereof
are intended to be for the sole and exclusive benefit of the parties and their
respective successors and said controlling persons and officers and directors
and their heirs and legal representatives, and for the benefit of no other
person, firm or corporation. No purchaser of Notes from any Agent shall be
deemed to be a successor by reason merely of such purchase.
Section 15. Governing Law. This Agreement shall be governed by the laws of the
State of New York applicable to agreements made and performed in such State.
If the foregoing is in accordance with the Agents' understanding of our
agreement, please sign and return to the Company a counterpart hereof,
whereupon this instrument along with all counterparts will become a binding
agreement among the Agents and the Company in accordance with its terms.
Very truly yours,
TCI Comunications, Inc.
By: _________________________________
Name: Bernard W. Schotters
Title: Senior Vice President--
Finance and Treasurer
17
<PAGE>
Accepted:
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
By: ___________________________
Authorized Signatory
CS First Boston Corporation
By: ___________________________
Authorized Signatory
Salomon Brothers Inc.
By: ___________________________
Authorized Signatory
Lehman Brothers Inc.
By: ___________________________
Authorized Signatory
18
<PAGE>
SCHEDULE A
As compensation for the services of the Agents hereunder, the Company shall
pay, on a discount basis, at the Settlement Time to each Agent a commission in
connection with each original issuance of Notes by the Company for the sale of
each Note resulting from a placement made by such Agent equal to the principal
amount of such Note (or, if such Note is an Original Issue Discount Note, the
Issue Price of such Note) multiplied by the appropriate percentage set forth
below:
<TABLE>
<CAPTION>
PERCENT OF PRINCIPAL AMOUNT
----------------------------
MATURITY RANGES SPLIT RATED INVESTMENT GRADE
--------------- ----------- ----------------
<S> <C> <C>
From 9 months to less than 1 year.................. .150% .125%
From 1 year to less than 18 months................. .200 .150
From 18 months to less than 2 years................ .250 .200
From 2 years to less than 3 years.................. .350 .250
From 3 years to less than 4 years.................. .450 .350
From 4 years to less than 5 years.................. .550 .450
From 5 years to less than 6 years.................. .600 .500
From 6 years to less than 7 years.................. .600 .550
From 7 years to less than 8 years.................. .700 .600
From 8 years to less than 9 years.................. .700 .600
From 9 years to less than 10 years................. .700 .600
From 10 years to less than 12 years................ .800 .625
From 12 years to less than 15 years................ .800 .625
From 15 years to less than 20 years................ .875 .700
From 20 years to 30 years.......................... .925 .750
</TABLE>
19
<PAGE>
EXHIBIT A
TO
DISTRIBUTION
AGREEMENT
TERMS AGREEMENT PROVISIONS
The following terms, if applicable, shall be agreed to by the applicable
Agent and the Company pursuant to each Terms Agreement:
Principal Amount: $
(or principal amount of foreign currency)
Interest Rate:
If Fixed Rate Note, Interest Rate:
If Floating Rate Note:
Interest Rate Basis:
Initial Interest Rate:
Initial Interest Reset Date:
Spread or Spread Multiplier, if any:
Interest Reset Dates:
Interest Payment Dates:
Index Maturity:
Maximum Interest Rate, if any:
Maximum Interest Rate, if any:
Interest Determination Dates:
Calculation Agent and Dates:
If Redeemable by the Company:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction:
If Repayable by the holder thereof:
Holder's Optional Repayment Date(s):
Stated Maturity:
Purchase Price: %
Settlement Time:
Currency of Denomination:
Denominations (if currency is other than solely United States dollars):
Currency Payment:
Additional Terms:
Also, agreement as to whether the following will be required:
Officer's Certificates pursuant to Section 7(b) of the Distribution
Agreement.
Accountant's Comfort Letters pursuant to Section 7(d) of the
Distribution Agreement.
Legal Opinions pursuant to Section 7(c) of the Distribution Agreement.
Stand-Off Agreement pursuant to Section 4(g) of the Distribution
Agreement.
20
<PAGE>
EXHIBIT 4.1
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
TCI COMMUNICATIONS, INC.
AND
THE BANK OF NEW YORK
TRUSTEE
----------------
INDENTURE
DATED AS OF , 1995
----------------
DEBT SECURITIES
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
CROSS-REFERENCE TABLE
<TABLE>
<CAPTION>
TIA INDENTURE
SECTION SECTION
<C> <S> <C>
310 (a)(1).............................................. 7.10
(a)(2).............................................. 7.10
(a)(3).............................................. N.A.
(a)(4).............................................. N.A.
(b)................................................. 7.08; 7.10; 11.02
(c)................................................. N.A.
311 (a)................................................. 7.11
(b)................................................. 7.11
(c)................................................. N.A.
312 (a)................................................. 2.07
(b)................................................. 11.03
(c)................................................. 11.03
313 (a)................................................. 7.06
(b)(1).............................................. N.A.
(b)(2).............................................. 7.06
(c)................................................. 11.02
(d)................................................. 7.06
314 (a)................................................. 4.06; 11.02
(b)................................................. N.A.
(c)(1).............................................. 11.04
(c)(2).............................................. 11.04
(c)(3).............................................. N.A.
(d)................................................. N.A.
(e)................................................. 11.05
(f)................................................. N.A.
315 (a)................................................. 7.01(b)
(b)................................................. 7.05; 11.02
(c)................................................. 7.01(a)
(d)................................................. 7.01(c)
(e)................................................. 6.11
316 (a)(last sentence).................................. 11.06
(a)(1)(A)........................................... 6.05
(a)(1)(B)........................................... 6.04
(a)(2).............................................. N.A.
(b)................................................. 6.07
317 (a)(1).............................................. 6.08
(a)(2).............................................. 6.09
(b)................................................. 2.06
318 (a)................................................. 11.01
</TABLE>
- --------
N.A. means Not Applicable.
2
<PAGE>
TABLE OF CONTENTS
----------------
<TABLE>
<CAPTION>
Section Heading Page
<C> <S> <C>
ARTICLE ONE
Definitions and Incorporation by Reference
1.01. Definitions.................................................... 6
1.02. Other Definitions.............................................. 12
1.03. Incorporation by Reference of Trust Indenture Act.............. 12
1.04. Rules of Construction.......................................... 12
ARTICLE TWO
The Securities
2.01. Forms Generally................................................ 13
2.02. Amount Unlimited; Issuable in Series........................... 13
2.03. Denominations.................................................. 16
2.04. Execution, Authentication, Delivery and Dating................. 16
2.05. Registrar, Paying Agent, Conversion Agent and Authenticating
Agent......................................................... 18
2.06. Paying Agent to Hold Money and Securities in Trust............. 20
2.07. Securityholder Lists........................................... 20
2.08. Transfer and Exchange.......................................... 20
2.09. Replacement Securities......................................... 23
2.10. Securities in Global Form...................................... 24
2.11. Temporary Securities........................................... 25
2.12. Cancellation................................................... 25
2.13. Payment of Interest; Defaulted Interest........................ 26
2.14. Persons Deemed Owners.......................................... 26
ARTICLE THREE
Redemption
3.01. Applicability of Article....................................... 27
3.02. Notices to Trustee............................................. 27
3.03. Selection of Securities to be Redeemed......................... 28
3.04. Notice of Redemption........................................... 28
3.05. Effect of Notice of Redemption................................. 29
3.06. Deposit of Redemption Price.................................... 30
3.07. Securities Redeemed in Part.................................... 30
3.08. Conversion Arrangement on Call for Redemption.................. 30
ARTICLE FOUR
Covenants
4.01. Payment of Securities; Maintenance of Office or Agency......... 31
4.02. Change of Control.............................................. 32
4.03. Designation of Restricted Subsidiaries......................... 35
4.04. Limitation on Liens............................................ 35
4.05. Limitation on Restricted Subsidiary Funded Debt................ 36
4.06. SEC Reports.................................................... 36
4.07. Compliance Certificate......................................... 36
4.08. Corporate Existence............................................ 37
4.09. Waiver of Certain Covenants.................................... 37
4.10. No Lien Created................................................ 37
4.11. Calculation of Original Issue Discount......................... 37
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
Section Heading Page
<C> <S> <C>
ARTICLE FIVE
Successor Corporation
5.01. When Company May Merge, etc...................................... 37
ARTICLE SIX
Defaults and Remedies
6.01. Events of Default................................................ 38
6.02. Acceleration..................................................... 39
6.03. Other Remedies................................................... 39
6.04. Waiver of Existing Defaults...................................... 40
6.05. Control by Majority.............................................. 40
6.06. Limitation on Suits.............................................. 40
6.07. Rights of Holders to Receive Payment and to Convert.............. 40
6.08. Collection Suit by Trustee....................................... 41
6.09. Trustee May File Proofs of Claim................................. 41
6.10. Priorities....................................................... 41
6.11. Undertaking for Costs............................................ 41
ARTICLE SEVEN
Trustee
7.01. Duties of Trustee................................................ 41
7.02. Rights of Trustee................................................ 42
7.03. Individual Rights of Trustee..................................... 42
7.04. Trustee's and Authenticating Agent's Disclaimer.................. 43
7.05. Notice of Defaults............................................... 43
7.06. Reports by Trustee to Holders.................................... 43
7.07. Compensation and Indemnity....................................... 43
7.08. Replacement of Trustee........................................... 44
7.09. Successor Trustee by Merger, etc................................. 44
7.10. Eligibility; Disqualification.................................... 44
7.11. Preferential Collection of Claims Against Company................ 44
ARTICLE EIGHT
Discharge of Indenture
8.01. Termination of Company's Obligations............................. 45
8.02. Application of Trust Fund........................................ 45
8.03. Repayment to Company............................................. 46
ARTICLE NINE
Amendments, Supplements and Waivers
9.01. Without Consent of Holders....................................... 46
9.02. With Consent of Holders.......................................... 47
9.03. Compliance with Trust Indenture Act.............................. 47
9.04. Effect of Amendments and Supplements............................. 48
9.05. Notation on or Exchange of Securities............................ 48
9.06. Trustee to Sign Amendments, etc.................................. 48
</TABLE>
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<TABLE>
<CAPTION>
Section Heading Page
<C> <S> <C>
ARTICLE TEN
Conversion
10.01. Applicability of Article....................................... 48
10.02. Conversion Privilege........................................... 48
10.03. Conversion Procedure........................................... 49
10.04. Fractional Shares.............................................. 49
10.05. Taxes on Conversion............................................ 50
10.06. Company to Provide Stock....................................... 50
10.07. Adjustment for Change in Capital Stock......................... 50
10.08. Adjustment for Rights Issue.................................... 51
10.09. Adjustments for Other Distributions............................ 51
10.10. Voluntary Adjustment........................................... 52
10.11. Certain Definitions............................................ 53
10.12. When Adjustment May Be Deferred................................ 54
10.13. When Adjustment Is Not Required................................ 54
10.14. Notice of Adjustment........................................... 54
10.15. Notice of Certain Transactions................................. 54
10.16. Consolidation, Merger or Sale of the Company................... 55
10.17. Company Determination Final.................................... 55
10.18. Trustee's and Conversion Agent's Disclaimer.................... 55
10.19. Simultaneous Adjustments....................................... 55
ARTICLE ELEVEN
Miscellaneous
11.01. Trust Indenture Act Controls................................... 56
11.02. Notices........................................................ 56
11.03. Communication by Holders with Other Holders.................... 57
11.04. Certificate and Opinion as to Conditions Precedent............. 57
11.05. Statements Required in Certificate or Opinion.................. 57
11.06. When Treasury Securities Disregarded........................... 58
11.07. Rules by Trustee and Agents.................................... 57
11.08. Legal Holidays................................................. 58
11.09. Governing Law.................................................. 58
11.10. No Adverse Interpretation of Other Agreements.................. 58
11.11. No Recourse Against Others..................................... 58
11.12. Successors..................................................... 58
11.13. Duplicate Originals............................................ 58
11.14. Table of Contents, Headings, Etc............................... 59
11.15. Acts of Holders................................................ 59
ARTICLE TWELVE
Meetings of Holders of Securities
12.01. Purposes for which Meetings May be Called...................... 60
12.02. Call, Notice and Place of Meetings............................. 60
12.03. Persons Entitled to Vote at Meetings........................... 60
12.04. Quorum; Action................................................. 61
12.05. Determination of Voting Rights; Conduct and Adjournment of
Meetings...................................................... 61
12.06. Counting Votes and Recording Action of Meetings................ 62
Signatures.............................................................. 63
</TABLE>
5
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INDENTURE dated as of August 4, 1993, between TCI COMMUNICATIONS, INC., a
Delaware corporation ("Company"), and THE BANK OF NEW YORK, a New York banking
corporation ("Trustee").
The Company has duly authorized the execution and delivery of this Indenture
to provide for the issuance from time to time of its unsecured debentures,
notes, bonds or other evidences of indebtedness ("Securities"), to be issued
in one or more series as provided in this Indenture.
Each party agrees as follows for the benefit of the other party and for the
equal and ratable benefit of the respective Holders from time to time of the
Securities or of series thereof:
ARTICLE ONE
Definitions and Incorporation by Reference
Section 1.01. Definitions.
Additional Amounts means any additional amounts which are required hereby or
by any Security, under circumstances specified herein or therein, to be paid
by the Company in respect of certain taxes imposed on Holders specified
therein and which are owing to such Holders.
Affiliate of any person means any other person directly or indirectly
controlling or controlled by or under direct or indirect common control with
such person.
Agent means any Registrar, Paying Agent, co-Registrar or Conversion Agent.
See Section 2.05.
Authenticating Agent means any person authorized by the Trustee pursuant
hereto to act on behalf of the Trustee to authenticate Securities of one or
more series.
Authorized Newspaper means a newspaper, in the English language or in an
official language of the place of publication, customarily published on each
day that is a Business Day in the place of publication, whether or not
published on days that are Legal Holidays in the place of publication, and of
general circulation in each place in connection with which the term is used or
in the financial community of each such place. Where successive publications
are required to be made in Authorized Newspapers, the successive publications
may be made in the same or in different newspapers in the same city meeting
the foregoing requirements in and each case on any day that is a Business Day
in the place of publication.
Bearer Security means any Security which is established pursuant to this
Indenture which is payable to bearer.
Board of Directors means the Board of Directors of the Company or any
authorized committee thereof.
Business Day, except as may otherwise be provided in the form of Securities
of any particular series, means, with respect to any place of payment or other
location, each Monday, Tuesday, Wednesday, Thursday and Friday that is not a
Legal Holiday in such place of payment or other location.
"Change of Control" means the occurrence of either of the following events
(to the extent applicable): (A) the acquisition by any person (other than the
Parent, the Company, any Subsidiary or Parent Subsidiary, any employee stock
ownership or other employee benefit plan of the Parent or the Company or of
any Subsidiary or Parent Subsidiary, or any Controlling Person) during any
period of twelve (12) consecutive months of beneficial ownership of shares of
the Class A Stock or Class B Stock or both representing in the aggregate
thirty percent (30%) or more of the combined voting power of all shares of the
Class A Stock and Class B Stock, calculated on a fully diluted basis as of the
date immediately prior to the date of such acquisition (or, if there be more
than one acquisition during such twelve-month period, the date of the last
such acquisition); provided, however, that notwithstanding the foregoing, no
Change of Control shall be deemed to have occurred if and for so long as the
shares of the Class A Stock and Class B Stock beneficially owned by the
Parent, the Parent Subsidiaries (other than the Company) and the Controlling
Persons represent in the aggregate 30% or more of the combined voting power of
all shares of the Class A Stock and Class B Stock calculated on a fully
diluted basis, or (B) for so long as the Company is a Parent Subsidiary, the
acquisition by any person (other than the Parent, any Parent
6
<PAGE>
Subsidiary, any employee stock ownership plan or other employee benefit plan
of the Parent or any Parent Subsidiary, or any Controlling Person) during any
period of twelve (12) consecutive months of beneficial ownership of shares of
common stock of the Parent representing in the aggregate thirty percent (30%)
or more of the combined voting power of all shares of the Parent's common
stock, calculated on a fully diluted basis as of the date immediately prior to
the date of such acquisition (or, if there be more than one acquisition during
such twelve-month period, the date of the last such acquisition; provided,
however, that notwithstanding the foregoing no Change of Control shall be
deemed to have occurred if and for so long as the shares of the Parent's
common stock beneficially owned by the Controlling Persons represent in the
aggregate 30% or more of the combined voting power of all shares of the
Parent's common stock calculated on a fully diluted basis.
Class A Stock means the Class A Common Stock, $1.00 par value, of the
Company as it exists on the date of this Indenture and stock of any other
class into which such Class A Common Stock may thereafter have been changed.
Class B Stock means the Class B Common Stock, $1.00 par value, of the
Company as it exists on the date of this Indenture and stock of any other
class into which such Class B Common Stock may thereafter have been changed.
Company means TCI Communications, Inc., a Delaware corporation, until a
successor replaces it pursuant to the applicable provisions of this Indenture
and thereafter means the successor.
Controlling Person means each of (1) the Chairman of the Board of the Parent
as of the date of this Indenture, (2) the President of the Parent as of the
date of this Indenture, (3) each of the directors of the Parent as of the date
of this Indenture, (4) the respective family members, estates and heirs of
each of the persons referred to in clauses (1) through (3) above and any trust
or other investment vehicle for the primary benefit of any of such persons or
their respective family members or heirs, (5) Kearns-Tribune Corporation, a
Delaware corporation or any successor thereto by merger or consolidation and
(6) the trustee under the Parent's Employee Stock Purchase Plan or any
successor plan or any other employee stock ownership or other employee benefit
plan of the Parent or the Company or any Subsidiary or Parent Subsidiary. As
used with respect to any person, the term "family member" means the spouse,
siblings and lineal descendants of such person. The trustee under the Parent's
Employee Stock Purchase Plan or any successor plan or any other employee stock
ownership or other employee benefit plan of the Parent or the Company or of
any Subsidiary or Parent Subsidiary shall be deemed to have beneficial
ownership of all shares of common stock of the Parent or the Company held
under the plan, whether or not allocated to or vested in participants'
accounts.
Convertible Securities means any or all options, warrants, securities and
rights, except the Series B TCI Group Common Stock and the Securities, which
are convertible into or exercisable or exchangeable for Parent Stock or which
otherwise entitle the holder thereof to subscribe for, purchase or otherwise
acquire Parent Stock.
coupon means any interest coupon appertaining to a Bearer Security.
Debt means, with respect to any person: (1) any indebtedness of such person
(i) for borrowed money or (ii) evidenced by a note, debenture or similar
instrument (including a purchase money obligation) given in connection with
the acquisition of any property or assets, including securities; (2) any
guarantee by such person of any indebtedness of others described in the
preceding clause (1); and (3) any amendment, renewal, extension or refunding
of any such indebtedness or guarantee.
Default means any event which is, or after notice or passage of time would
be, an Event of Default.
Dollar or $ or U.S. Dollar means a dollar or other equivalent unit in such
coin or currency of the United States of America as at the time shall be legal
tender for the payment of public and private debts.
Funded Debt of any person means, as of the date as of which the amount
thereof is to be determined, without duplication, all indebtedness of such
person for borrowed money and all guaranties by such person of any
indebtedness of others for borrowed money, which by its terms has a final
maturity, duration or payment date more than one year from the date of
determination thereof (including, without limitation, any balance of such
indebtedness which was Funded Debt at the time of its creation maturing within
one year from such date of
7
<PAGE>
determination) or which has a final maturity, duration or payment date within
one year from such date of determination but which by its terms may be renewed
or extended at the option of such person for more than one year from such date
of determination, whether or not theretofore renewed or extended. When used
with respect to the Company or any Restricted Subsidiary, the term "Funded
Debt" excludes (1) any indebtedness of the Company or any Restricted Subsidiary
to the Company or another Restricted Subsidiary, (2) any guarantee by the
Company or any Restricted Subsidiary of indebtedness of the Company or another
Restricted Subsidiary, provided that such guarantee is not secured by a Lien on
Restricted Property, and (3) with respect to any series of Securities, any
indebtedness of the Company or any Restricted Subsidiary to any Unrestricted
Subsidiary which indebtedness is subordinated in right of payment to the prior
payment in full of the outstanding Securities of such series on terms no less
favorable to the holders of such Securities than those contained in Article Ten
of that certain Indenture, dated as of April 1, 1991, between the Company and
Chemical Bank, as Trustee, pursuant to which the Company's subordinated debt
securities are subordinated to all Senior Debt of the Company (as defined
therein), without giving effect to any amendment, modification or supplement
to, or discharge of, such Indenture after the date hereof, and which
indebtedness is not secured by a Lien on Restricted Property. For purposes of
determining the outstanding principal amount of Funded Debt at any date, the
amount of indebtedness issued at a price less than the principal amount thereof
shall be equal to the amount of the liability in respect thereof at such date
determined in accordance with generally accepted accounting principles.
Government Obligations, with respect to any Security, means (i) direct
obligations of the government or governments which issued the currency in which
the principal of or any interest on such Security or any Additional Amounts in
respect thereof shall be payable, in each case where the payment or payments
thereunder are supported by the full faith and credit of such government or
governments or (ii) obligations of a person controlled or supervised by and
acting as an agency or instrumentality of such government or governments, in
each case where the payment or payments thereunder are unconditionally
guaranteed as a full faith and credit obligation by such government or
governments, and which, in the case of (i) or (ii), are not callable or
redeemable at the option of the issuer or issuers thereof, and shall also
include a depository receipt issued by a bank or trust company as custodian
with respect to any such Government Obligation or a specific payment of
interest on or principal of or other amount with respect to any such Government
Obligation held by such custodian for the account of the holder of a depository
receipt, provided that (except as required by law) such custodian is not
authorized to make any deduction from the amount payable to the holder of such
depository receipt from any amount received by the custodian in respect of the
Government Obligation or the specific payment of interest on or principal of or
other amount with respect to the Government Obligation evidenced by such
depository receipt.
Holder or Securityholder means, when used with respect to any Security, in
the case of a Registered Security the person in whose name the Security is
registered in the security register and in the case of a Bearer Security the
bearer thereof and, when used with respect to any coupon, means the bearer
thereof.
Indenture means this Indenture as amended or supplemented from time to time
and, unless the context indicates otherwise, shall include the form and terms
of a particular series of Securities established as contemplated hereunder.
interest, when used with respect to an Original Issue Discount Security which
by its terms bears interest only after maturity or upon default in any other
payment due on such Security, means interest payable after maturity or upon
such a default, as the case may be.
Interest Payment Date means the date, if any, specified in the Securities of
any series or a coupon representing an installment of interest as the fixed
date on which an installment of interest on the Securities of that series or
such coupon is due and payable.
Leverage Ratio with respect to the Restricted Group means, as of the date of
and after giving effect to any designation of an Unrestricted Subsidiary as a
Restricted Subsidiary and/or any designation of a Restricted Subsidiary as an
Unrestricted Subsidiary, in each case in accordance with Section 4.03, the
ratio of (1) the aggregate outstanding principal amount of all Funded Debt of
the Restricted Group as of such date to (2) the product of four times the
Restricted Group Cash Flow for the most recent full fiscal quarter for which
financial information is available on such date.
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Lien means any mortgage, pledge, lien, security interest, or other similar
encumbrance.
Maximum Funded Debt Amount means, as of any date of determination thereof,
that amount which is equal to the product of (i) eight and (ii) the product of
(x) the Restricted Group Cash Flow for the most recent full fiscal quarter for
which financial information is available on such date and (y) four.
Officer means the Chairman of the Board, the President, any Vice President,
the Treasurer or the Secretary of the Company.
Officers' Certificate means a certificate signed by two Officers or by an
Officer and an Assistant Treasurer or an Assistant Secretary of the Company
and delivered to the Trustee. See Sections 11.04 and 11.05.
Opinion of Counsel means a written opinion from legal counsel who is
acceptable to the Trustee. The counsel may be an employee of or counsel to the
Company or the Trustee. See Sections 11.04 and 11.05.
original issue discount of any debt security, including any Original Issue
Discount Security, means the difference between the principal amount of such
debt security and the initial issue price of such debt security (as set forth,
in the case of an Original Issue Discount Security, on the face of such
Security).
Original Issue Discount Security means any Security which provides for an
amount less than the principal amount thereof to be due and payable upon
acceleration of the maturity thereof pursuant to Section 6.02.
outstanding, when used with respect to Securities of any series, means as of
the date of determination, all such Securities theretofore authenticated and
delivered under this Indenture, except:
(i) Securities theretofore cancelled by the Trustee or delivered to the
Trustee for cancellation;
(ii) Securities for whose payment, redemption or purchase the Trustee or
any Paying Agent (other than the Company) holds in trust or the Company
(acting as its own Paying Agent) has set aside and segregated in trust on a
maturity date, redemption date, Purchase Date or, if so specified with
respect to the Securities of any series pursuant to Section 2.02 on a date
(or, if so specified, on the Business Day following a date) on which
Securities of such series are to be purchased by the Company pursuant to
any provision thereof providing for such purchase at the option of the
Holder or the Company, money (or securities if permitted by the terms of
such Securities) sufficient to pay Securities and any coupons appertaining
thereto payable on that date;
(iii) Securities with respect to which the Company has terminated its
obligations pursuant to Section 8.01 hereof; provided, however, that such
Securities shall continue to be outstanding for all purposes related to
those obligations that survive such termination as provided in Section 8.01
unless and until they cease to be outstanding in accordance with clauses
(i) or (ii) above or clause (iv) below; and
(iv) Securities which have been paid pursuant to Section 2.09 or in
exchange for or in lieu of which other Securities have been authenticated
and delivered pursuant to this Indenture, other than any such Securities in
respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Securities are held by a bona fide purchaser
in whose hands such Securities are valid obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver or taken any other action
hereunder or whether a quorum is present at a meeting of Holders, and for the
purpose of making the calculations required by TIA (S) 313, (x) the principal
amount of an Original Issue Discount Security that shall be deemed to be
outstanding for such purposes shall be the amount of the principal thereof
that would be due and payable as of the date of such determination upon a
declaration of acceleration of the maturity thereof pursuant to Section 6.02,
and (y) the principal amount of a Security denominated in a foreign currency
or currencies or composite currency shall be the U.S. Dollar equivalent,
determined as of the date of original issuance of such Security, of the
principal amount of such Security (or, in the case of an Original Issue
Discount Security, the U.S. Dollar equivalent as of such date of original
issuance of such Security of the amount determined as provided in clause (x)
above). Subject to the provisions of Section 11.06, a Security does not cease
to be outstanding because the Company or one of its Affiliates holds the
Security.
9
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Parent means Tele-Communications, Inc., a Delaware corporation, and any
successor thereof.
Parent Stock means the Tele-Communications, Inc. Series A TCI Group Common
Stock, $1.00 par value, as it exists on the date of this Indenture and any
other capital stock into which such Series A TCI Group Common Stock may
thereafter have been changed.
Parent Subsidiary means a corporation a majority of whose voting stock is
owned by the Parent and/or one or more Parent Subsidiaries. Voting stock is
capital stock having voting power under ordinary circumstances to elect
directors.
place of payment means, when used with respect to any Security, the place or
places where, subject to the provisions of Section 4.01, the principal of, or
interest on, or any Additional Amounts with respect to such Security are
payable as specified as contemplated by Section 2.02.
Predecessor Securities means, with respect of any Security, every previous
Security evidencing all or a portion of the same debt as that evidenced by
such particular Security, and, for the purpose of this definition, any
Security authenticated and delivered under Section 2.09 in exchange for or in
lieu of a mutilated, lost, destroyed or wrongfully-taken Security or a
Security to which a mutilated, lost, destroyed or wrongfully-taken coupon
appertains shall be deemed to evidence the same debt as the mutilated, lost,
destroyed or wrongfully-taken Security or the Security to which the mutilated,
lost, destroyed or wrongfully-taken coupon appertains, as the case may be.
principal of a debt security, including any Security, means the amount
(including, without limitation, if and to the extent applicable, any premium
and, in the case of an Original Issue Discount Security, any accrued original
issue discount, but excluding interest) that is payable with respect to such
debt security as of any date and for any purpose (including, without
limitation, in connection with any sinking fund, upon any redemption at the
option of the Company, upon any purchase or exchange at the option of the
Company or the holder of such debt security and upon any acceleration of the
maturity of such debt security).
principal amount of a debt security, including any Security, means (except
as otherwise provided in the definition of "Funded Debt" in this Section 1.01)
the principal amount as set forth on the face of such debt security.
Principal Property means, as of any date of determination, any property or
assets owned by any Restricted Subsidiary other than (1) any such property
which, in the good faith opinion of the Board of Directors, is not of material
importance to the business conducted by the Company and its Restricted
Subsidiaries taken as a whole and (2) any shares of any class of stock or any
other security of any Unrestricted Subsidiary.
Registered Security means any Security issued pursuant to this Indenture
which is registered in the security register.
Regular Record Date means the date, if any, specified in the Registered
Securities of any series as the record date for the determination of
Securityholders to whom interest is payable on the next succeeding Interest
Payment Date.
Restricted Group means, as of any date of determination, the Company and the
Restricted Subsidiaries as of such date after giving effect to any
designations being made on such date in accordance with Section 4.03.
Restricted Group Cash Flow for any period means the Restricted Group Net
Income (as defined below) for such period, plus (A) the sum (without
duplication) of the aggregate of each of the following items of the Company
and the Restricted Subsidiaries for such period to the extent taken into
account as charges to Restricted Group Net Income for such period: (i)
interest expense, (ii) income tax expense, (iii) depreciation and amortization
expense and other noncash charges, (iv) extraordinary items and (v) after-tax
losses on sales of assets outside of the ordinary course of business not
otherwise included in extraordinary items in accordance with generally
accepted accounting principles, minus (B) the sum (without duplication) of the
aggregate of each of the following items of the Company and the Restricted
Subsidiaries for such period to the extent taken into account as credits to
Restricted Group Net Income for such period: (i) noncash credits, (ii)
extraordinary items, and (iii) after-tax gains on sales of assets outside of
the ordinary course of business not otherwise included in extraordinary items
in accordance with generally accepted accounting principles.
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For purposes of this definition, (1) "Restricted Group Net Income" for any
period means the aggregate of the net income (loss) for such period of the
Company and the Restricted Subsidiaries, determined on a consolidated basis in
accordance with generally accepted accounting principles; provided, however,
that (i) the net income (loss) of any person accounted for by the equity
method of accounting and the net income (loss) of any Unrestricted Subsidiary
shall be excluded, except that the net income of any such person or
Unrestricted Subsidiary shall be included to the extent of the amount of
dividends or distributions paid by such person or Unrestricted Subsidiary to
the Company or a Restricted Subsidiary during such period, and (ii) except as
otherwise provided in clause (2) below, the net income (loss) of any other
person acquired by the Company or any Restricted Subsidiary in a transaction
accounted for as a pooling of interests for any period prior to the date of
such acquisition shall be excluded; and (2) if the Company or any Restricted
Subsidiary consummated any acquisition or disposition of assets during the
period for which Restricted Group Cash Flow is being calculated, or
consummated any acquisition or disposition of assets subsequent to such period
and on or prior to the date as of which the Leverage Ratio or Maximum Funded
Debt Amount, as applicable, is to be determined, then, in each such case, the
Restricted Group Cash Flow for such period shall be calculated on a pro forma
basis as if such acquisition or disposition had occurred at the beginning of
such period.
Restricted Property means, as of any date of determination, any Principal
Property and any shares of stock of a Restricted Subsidiary owned by the
Company or a Restricted Subsidiary.
Restricted Subsidiary means, as of any date of determination, a corporation
a majority of whose voting stock is owned by the Company and/or one or more
Restricted Subsidiaries, which corporation has been, or is then being,
designated a Restricted Subsidiary in accordance with Section 4.03, unless and
until designated an Unrestricted Subsidiary in accordance with Section 4.03.
SEC means the Securities and Exchange Commission.
Securities means the Securities that are issued from time to time in one or
more series under this Indenture as such Securities are amended or
supplemented from time to time.
Series B TCI Group Common Stock means the Tele-Communications, Inc. Series B
TCI Group Common Stock, $1.00 par value, as it exists on the date of this
Indenture and any other capital stock into which such Series B TCI Group
Common Stock may thereafter have been changed.
Subsidiary means a corporation a majority of whose voting stock is owned by
the Company and/or one or more Subsidiaries. Voting stock is capital stock
having voting power under ordinary circumstances to elect directors.
TIA means the Trust Indenture Act of 1939 (15 U.S. Code (S)(S)77aaa-77bbbb)
as in effect on the date of this Indenture, except as provided in Section
9.03.
Trustee means the party named as such in this Indenture until a successor
replaces it and thereafter means the successor and if at any time there is
more than one such party, "Trustee" as used with respect to the Securities of
any series shall mean the Trustee with respect to Securities of that series.
Trust Officer means any officer or assistant officer in the corporate trust
department of the Trustee assigned by the Trustee to administer its corporate
trust matters.
United States, except as otherwise provided in or pursuant to this
Indenture, means the United States of America (including the States and the
District of Columbia), its territories, its possessions and other areas
subject to its jurisdiction.
United States Alien, except as otherwise provided in or pursuant to this
Indenture, means any person who, for United States Federal income tax
purposes, is a foreign corporation, a non-resident alien individual, a non-
resident alien fiduciary of a foreign estate or trust, or a foreign
partnership one or more of the members of which is, for United States Federal
income tax purposes, a foreign corporation, a non-resident alien individual or
a non-resident alien fiduciary of a foreign estate or trust.
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Unrestricted Subsidiary means, as of any date of determination, any
Subsidiary of the Company that is not a Restricted Subsidiary.
Section 1.02. Other Definitions.
<TABLE>
<CAPTION>
TERM DEFINED IN SECTION
<S> <C>
Act...................................................... 11.15
Average Market Price..................................... 10.11
Bankruptcy Law........................................... 6.01
Code..................................................... 9.01
Conversion Agent......................................... 2.05
current market price..................................... 10.11
Custodian................................................ 6.01
Determination Date....................................... 10.11
D&P...................................................... 4.02
Event of Default......................................... 6.01
Ex-Dividend Date......................................... 10.11
Legal Holiday............................................ 11.08
Moody's.................................................. 4.02
Paying Agent............................................. 2.05
Purchase Date............................................ 4.02
Put Event................................................ 4.02
Registrar................................................ 2.05
</TABLE>
Section 1.03. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
Commission means the SEC.
indenture securities means the Securities.
indenture security holder means a Securityholder.
indenture to be qualified means this Indenture.
indenture trustee or institutional trustee means the Trustee.
obligor on the indenture securities means the Company and any other
obligor thereon.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule have the
meanings assigned to them.
Section 1.04. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned to
it in accordance with generally accepted accounting principles in effect on
the date of this Indenture;
(3) "or" is not exclusive; and
(4) words in the singular include the plural, and in the plural include
the singular.
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ARTICLE TWO
The Securities
Section 2.01. Forms Generally.
The Securities of each series may be issued as Registered Securities without
coupons attached, or Bearer Securities with or without coupons attached, or
both, and may be issued in whole or in part in the form of one or more global
Securities as shall be specified as contemplated by Section 2.02. In the
absence of any contrary provisions with respect to the Securities of any
series, the Securities shall be issued as Registered Securities and shall not
be issuable upon the exercise of warrants. Bearer Securities shall be issued
with coupons attached unless otherwise provided with respect to the Securities
of any series as contemplated by Section 2.02.
The Securities of each series (including any temporary global Securities)
and related coupons, if any, shall be in one of the forms established from
time to time by or pursuant to a resolution of the Board of Directors or in or
pursuant to one or more indentures supplemental hereto, which shall set forth
the information required by Section 2.02. The Securities and coupons, if any,
shall have such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Indenture or by a resolution
of the Board of Directors and may have such notations, legends or endorsements
as the Company may deem appropriate and as are not inconsistent with the
provisions of this Indenture, or as may be required by law, stock exchange
rule or usage. The Company shall approve the form or forms of Securities and
any coupons appertaining thereto and any notation, legend or endorsement on
them. If the form or forms of Securities of any series or coupons are
established by action taken pursuant to a resolution of the Board of Directors
or indenture supplemental hereto, a copy of an appropriate record of such
action shall be certified by the Secretary or an Assistant Secretary of the
Company and delivered to the Trustee at or prior to the delivery of the
written order of the Company contemplated by Section 2.04 for the
authentication and delivery of such Securities or coupons.
Subject to Section 2.05, the form of the Trustee's certificate of
authentication to be borne by the Securities shall be substantially as
follows:
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated herein referred to in
the within-mentioned Indenture.
The Bank of New York
as Trustee
By __________________________________
Authorized Signatory
Section 2.02. Amount Unlimited; Issuable in Series
The aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. There shall be
established in or pursuant to a resolution of the Board of Directors or
established in or pursuant to one or more indentures supplemental hereto,
prior to the issuance of Securities of any series:
(1) the title of Securities of the series (which shall distinguish
Securities of the series from all other Securities);
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(2) any limit upon the aggregate principal amount of Securities of the
series which may be authenticated and delivered under this Indenture
(except for Securities authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other Securities of the
series pursuant to Sections 2.08, 2.09, 2.11, 3.07 or 9.05 and except for
any Securities which pursuant to Section 2.04 are deemed not to have been
authenticated and delivered hereunder);
(3)(A) whether Securities of the series are issuable as Registered
Securities, as Bearer Securities or alternatively as Bearer Securities and
Registered Securities, and whether the Bearer Securities are to be issuable
with coupons, without coupons or both; (B) any restrictions applicable to
the offer, sale or delivery of Bearer Securities and the terms upon which
Bearer Securities of the series may be exchanged for Registered Securities
of the series and vice versa (if permitted by applicable laws and
regulations); (C) whether any of the Securities of the series are to be
issuable in global form and, if so, (i) the identity of the depositary with
respect to any such global Security and (ii) whether beneficial owners of
interests in any such global Security may exchange such interests for
Securities of the same series and of like tenor and of any authorized form
and denomination, and, if so, the circumstances under which and the manner
in which any such exchanges may occur, if other than as specified in
Section 2.08; (D) if any of the Securities of the series are to be issuable
as Bearer Securities or in global form, the date as of which any such
Bearer Security or global Security shall be dated (if other than the date
of original issuance of the first of such Securities to be issued); and (E)
if Securities of the series are to be issuable in definitive form (whether
upon original issue, upon exchange of a temporary Security of such series,
or in exchange for a beneficial ownership interest in a permanent global
Security) only upon receipt of certain certificates or other documents or
satisfaction of other conditions, or if Securities of the series are
initially issuable in temporary global form and if owners of beneficial
interests therein may exchange such interest for an interest in a permanent
global Security only upon receipt of certain certificates or other
documents or satisfaction of other conditions, then the form and/or terms
of such certificates, documents or conditions;
(4)(A) the person to whom any interest on any Registered Security of the
series shall be payable, if other than the person in whose name that
Security (or one or more Predecessor Securities) is registered at the close
of business on the Regular Record Date for such interest; (B) the manner in
which, or the person to whom, any interest on any Bearer Security of the
series shall be payable, if otherwise than upon presentation and surrender
of the coupons appertaining thereto as they severally mature; and (C) if
any Securities of the series are to be issuable as Bearer Securities, the
extent to which, or the manner in which, and the terms and conditions
(including certification requirements) upon which, any interest in respect
of any portion of a temporary Bearer Security in global form payable in
respect of an Interest Payment Date prior to the exchange of such temporary
global Security for a permanent global Security or for definitive
Securities of the series will be paid to any clearing organization with
respect to the portion of such temporary global Security held for its
account and, in such event, the terms and conditions (including
certification requirements) upon which any such interest payment received
by a clearing organization will be credited to the persons entitled to
interest payable on such Interest Payment Date, and any other requirements
in addition to or in lieu of those provided herein relating to the payment
of interest on or any Additional Amounts in respect of Bearer Securities;
(5) the date or dates (and whether fixed or extendible) on which the
principal of Securities of the series is payable;
(6) the rate or rates at which Securities of the series shall bear
interest, or the method of determining the same, if any, the date or dates
from which such interest shall accrue, or the method of determining the
same, if any, the Interest Payment Dates on which any such interest shall
be payable and the Regular Record Date for any interest payable on any
Registered Securities on any Interest Payment Date, whether and under what
circumstances Additional Amounts on Securities of the series or any of them
shall be payable, and the basis upon which interest will be calculated if
other than that of a 360-day year of twelve 30-day months;
(7) the place or places where, subject to Section 4.01, the principal of,
any interest on or any Additional Amounts payable in respect of Securities
of the series shall be payable, any Registered Securities
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of the series may be surrendered for registration of transfer, any
Securities of the series may be surrendered for exchange and notices and
demands to or upon the Company in respect of the Securities of the series
and this Indenture may be served;
(8) any provisions relating to the issuance of Securities of such series
at an original issue discount (including, without limitation, the issue
price thereof, the rate or rates at which such original issue discount
shall accrue, if any, and the date or dates from or to which or period or
periods during which such original issue discount shall accrue at such rate
or rates);
(9) the price or prices at which, the period or periods within which and
the terms and conditions upon which Securities of the series may be
redeemed or otherwise purchased, in whole or in part, at the option of the
Company, pursuant to any sinking fund or otherwise (including, without
limitation, the form or method of payment thereof if other than in cash);
(10) the obligation, if any, of the Company to redeem, purchase or repay
Securities of the series pursuant to any sinking fund or analogous
provisions or at the option of a Securityholder thereof and the price or
prices at which and the period or periods within which and the terms and
conditions upon which Securities of the series shall be redeemed, purchased
or repaid, in whole or in part, pursuant to such obligation (including,
without limitation, the form or method of payment thereof if other than in
cash);
(11) the currency or currencies, including composite currencies, in which
payment of the principal of, any interest on and any Additional Amounts
payable in respect of the Securities of the series shall be payable, or in
which the Securities of the series shall be denominated, if other than
Dollars;
(12) if the principal of, any interest on or any Additional Amounts
payable in respect of the Securities of the series is to be payable, at the
election of the Company or a Securityholder, in a currency or currencies,
including composite currencies, other than that in which the Securities of
such series are denominated or stated to be payable, the terms and
conditions upon which such election may be made and the method for
determining amounts payable;
(13) if the amount of payments of principal of or interest on the
Securities of the series may be determined with reference to an index,
formula or other method or methods (which index, formula, method or methods
may be based, without limitation, on one or more currencies, commodities,
equity indices or other indices), the terms and conditions upon which and
the manner in which such amounts shall be determined and paid or payable;
(14) the denominations in which any Registered Securities of the series
shall be issuable, if other than denominations of $1,000 and any integral
multiple thereof, and the denominations in which Bearer Securities of the
series shall be issuable if other than denomination of $5,000;
(15) if other than the principal amount thereof, the portion of the
principal amount of Securities of the series which shall be payable upon
acceleration of the maturity thereof pursuant to Section 6.02 or provable
in bankruptcy pursuant to Section 6.09, or, if applicable, which is
convertible in accordance with Article Ten;
(16) any Events of Default with respect to the Securities of a particular
series in lieu of or in addition to those set forth herein and the remedies
therefor;
(17) the obligation, if any, of the Company to permit the conversion of
Securities of such series into Parent Stock and the terms and conditions
upon which such conversion shall be effected (including, without
limitation, the initial conversion price or rate, the conversion period and
any other provision in addition to or in lieu of those set forth in this
Indenture relative to such obligation);
(18) if any Securities of the series are to be issuable upon the exercise
of warrants, this shall be so established and (if established by resolution
of the Board of Directors) so set forth, as well as the time, manner and
place for such Securities to be authenticated and delivered;
(19) if there is more than one Trustee, the identity of the Trustee and,
if not the Trustee, the identity of each Registrar, Paying Agent or
Conversion Agent with respect to the Securities of the series; and
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(20) any other terms of a particular series (including, without
limitation, if applicable, any designation of Restricted Subsidiaries
pursuant to Section 4.03 and, if other than the period commencing with the
date on which the Securities of that series are first issued and ending
with the maturity thereof, the period during which Section 4.02 would apply
in the event of a Change of Control of the Company), including any terms
which may be required by or advisable under United States laws or
regulations or advisable in connection with the marketing or remarketing of
Securities of that series, and any other provisions expressing or referring
to the terms and conditions upon which the Securities of that series are to
be issued under this Indenture, which terms and provisions are not in
conflict with the provisions of this Indenture; provided, however, that the
addition to or subtraction from or variation of Articles Four, Five, Six,
Eight and Ten (and Sections 1.01 and 1.02, insofar as they relate to the
definition of certain terms as used in such Articles) with regard to the
Securities of a particular series shall not be deemed to constitute a
conflict with the provisions of those Articles.
All Securities of any one series and the coupons appertaining to any Bearer
Securities of such series shall be substantially identical except, in the case
of Registered Securities, as to denomination and except as may otherwise be
provided in or pursuant to such resolution of the Board of Directors or in any
such indenture supplemental hereto. Not all Securities of any one series need
be issued at the same time, and, unless otherwise so provided, a series may be
reopened for issuances of additional Securities of such series.
If any of the terms of the Securities of a series are established by action
taken pursuant to a resolution of the Board of Directors or indenture
supplemental hereto, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee with an Officers' Certificate setting forth the terms
or the manner of determining the terms of the Securities of such series. With
respect to Securities of a series which are not to be issued at one time, such
resolution of the Board of Directors or action may provide general terms or
parameters for Securities of such series and provide either that the specific
terms of particular Securities of such series shall be specified in a written
order of the Company or that such terms shall be determined by the Company or
its agents in accordance with a written order of the Company as contemplated
by the last sentence of the fourth paragraph of Section 2.04.
Section 2.03. Denominations.
Unless otherwise provided as contemplated by Section 2.02 with respect to
any series of Securities and except as provided in Section 2.10, any
Registered Securities of a series denominated in Dollars shall be issuable in
denominations of $1,000 and any integral multiple thereof and any Bearer
Securities of a series denominated in Dollars shall be issuable in the
denomination of $5,000.
Section 2.04. Execution, Authentication, Delivery and Dating.
Two Officers shall sign the Securities for the Company. The Company's seal
shall be reproduced on the Securities. An Officer shall sign the coupons
attached to any Bearer Security for the Company. The signature of any Officer
on the Securities or any coupons appertaining thereto may be manual or
facsimile.
If an Officer whose signature is on a Security or a coupon no longer holds
that office at the time the Trustee authenticates such Security, the Security
and coupon shall be valid nevertheless.
A Security or coupon shall not be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose until the certificate of
authentication on the Security is manually signed by the Trustee or on its
behalf by an Authenticating Agent. The signature shall be conclusive evidence
that the Security has been authenticated under this Indenture. Notwithstanding
the foregoing, if any Security shall have been duly authenticated and
delivered hereunder but never issued and sold by the Company, and the Company
shall deliver such Security to the Trustee for cancellation as provided in
Section 2.12 together with a written statement (which need not comply with
Sections 11.04 and 11.05 and need not be accompanied by an Opinion of Counsel)
stating that such Security has not been issued and sold by the Company, for
all purposes of this Indenture such Security shall be deemed not to have been
authenticated and delivered hereunder and shall not be entitled to the
benefits of this Indenture.
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At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Securities of any series together with any
coupon appertaining thereto executed by the Company to the Trustee for
authentication, and the Trustee shall, subject to the provisions hereof and of
such Securities, authenticate said Securities and deliver said Securities and
any coupons appertaining thereto to or upon the written order of the Company,
signed by two Officers or by an Officer and an Assistant Treasurer of the
Company, without any further action by the Company. Unless otherwise specified
as contemplated by Section 2.02, no Bearer Security shall be mailed or
otherwise delivered to any location in the United States. Further, a Bearer
Security (including a permanent global Bearer Security) may be delivered only
if all applicable certification and other requirements specified as
contemplated by Section 2.02 with respect to the Securities of or within such
series have been satisfied with respect to such Bearer Security (or, if
applicable, a Predecessor Security). Except as permitted by Section 2.09, the
Trustee shall not authenticate and deliver any Bearer Security unless all
appurtenant coupons for interest then matured have been detached and
cancelled. If not all the Securities of a series are to be issued at one time
and if the resolution of the Board of Directors or indenture supplemental
hereto establishing such series as contemplated by Sections 2.01 and 2.02
shall so permit, the written order of the Company may set forth procedures
acceptable to the Trustee for the issuance of such Securities and for
determining the form of terms of particular Securities of such series
including, but not limited to, interest rate, maturity date, date of issuance
and date from which interest shall accrue.
If the form or forms or terms of Securities of the series and any related
coupons have been established in or pursuant to one or more resolutions of the
Board of Directors or indentures supplemental hereto as permitted by Sections
2.01 and 2.02, in authenticating such Securities, and accepting the additional
responsibilities under this Indenture in relation to such Securities, the
Trustee shall be entitled to receive, and (subject to Section 7.01) shall be
fully protected in relying upon, an Opinion of Counsel stating,
(1) if the form or forms of such Securities and any coupons have been
established by or pursuant to a resolution of the Board of Directors or
indenture supplemental hereto, that such form or forms have been
established in conformity with the provisions of this Indenture;
(2) if the terms of such Securities and any coupons have been established
by or pursuant to a resolution of the Board of Directors or indenture
supplemental hereto, that such terms have been established in conformity
with the provisions of this Indenture; and
(3) that such Securities together with any coupons appertaining thereto,
when authenticated and delivered by the Trustee and issued by the Company
in the manner and subject to any conditions specified in such Opinion of
Counsel, will constitute valid and legally binding obligations of the
Company, enforceable in accordance with their terms, subject to bankruptcy,
insolvency, fradulent conveyance, reorganization and other laws of general
applicability relating to or affecting the enforcement of creditors'
rights, to general equitable principles and to such other qualifications as
such counsel shall conclude do not materially affect the rights of Holders
of such Securities and any coupons;
provided, however, that, with respect to Securities of a series which are not
to be issued at one time, the Trustee shall be entitled to receive such
Opinion of Counsel only once at or prior to the time of the first
authentication of Securities of such series and that the opinions described in
clauses (2) and (3) above may state, respectively,
(a) that, when the terms of such Securities and any coupons shall have
been established pursuant to a written order of the Company or pursuant to
such procedures as may be specified from time to time by a written order of
the Company, all as contemplated by and in accordance with a resolution of
the Board of Directors or an Officers' Certificate pursuant to a resolution
of the Board of Directors or indenture supplemental hereto, as the case may
be, such terms will have been established in conformity with the provisions
of this Indenture; and
(b) that such Securities and any coupons appertaining thereto, when (i)
executed by the Company, (ii) completed, authenticated and delivered by the
Trustee in accordance with this Indenture, (iii) issued and
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delivered by the Company and (iv) paid for, all as contemplated by and in
accordance with the aforesaid written order of the Company or specified
procedures, as the case may be, and in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute valid and
legally binding obligations of the Company, enforceable in accordance with
their terms, subject to bankruptcy, insolvency, fraudulent conveyance,
reorganization and other laws of general applicability relating to or
affecting the enforcement of creditors' rights, to general equitable
principles and to such other qualifications as such counsel shall conclude
do not materially affect the rights of Holders of such Securities and any
coupons.
Notwithstanding the provisions of Sections 2.01, 2.02, 11.04 and this
Section, if all the Securities of a series are not to be originally issued at
one time, the resolution of the Board of Directors or indenture supplemental
hereto, the certified copy of the record of action taken pursuant to such
resolution or supplemental indenture, the Officers' Certificate, the written
order of the Company and any other documents otherwise required pursuant to
such Sections need not be delivered at or prior to the time of authentication
of each Security of such series if such documents are delivered at or prior to
the authentication upon original issuance of the first Security of such series
to be issued, provided, however, that any subsequent request by the Company to
the Trustee to authenticate Securities of such series shall constitute a
representation and warranty by the Company that as of the date of such
request, the statements made in the Officers' Certificate delivered pursuant
to Section 11.04 at or prior to authentication of the first such Security
shall be true and correct on the date thereof as if made on and as of the date
thereof.
The Trustee shall have the right to decline to authenticate and make
available for delivery any Securities together with any coupons appertaining
thereto under this Section if the issuance of such Securities pursuant to this
Indenture will alter the Trustee's own rights, duties or immunities under the
Securities and this Indenture or otherwise in a manner which is not reasonably
acceptable to the Trustee.
With respect to Securities of a series which are not all issued at one time,
the Trustee may conclusively rely, as to the authorization by the Company of
any of such Securities and any coupons, the form and terms thereof and the
legality, validity, binding effect and enforceability thereof, upon the
Opinion of Counsel, Officers' Certificate and other documents delivered
pursuant to Sections 2.01, 2.02, 11.04 and this Section, as applicable, at or
prior to the time of the first authentication of Securities of such series
unless and until such opinion, certificate or other documents have been
superseded or revoked. In connection with the authentication and delivery of
Securities of a series and any coupons which are not all issued at one time,
the Trustee shall be entitled to assume that the Company's instructions to
authenticate and deliver such Securities do not violate any rules, regulations
or orders of any governmental agency or commission having jurisdiction over
the Company.
Each Registered Security shall be dated the date of its authentication and
each Bearer Security (including any temporary Bearer Security in global form)
shall be dated as of the date specified as contemplated by Section 2.02.
Section 2.05. Registrar, Paying Agent, Conversion Agent and Authenticating
Agent.
The Company shall maintain an office or agency where Registered Securities
of each series may be presented for registration of transfer or for exchange
("Registrar"), an office or agency where Securities of each series may be
presented for payment ("Paying Agent") and an office or agency where
Securities of each series that is convertible may be presented for conversion
("Conversion Agent") and (but without duplication) such offices or agencies in
such locations and for such purposes as may be required as contemplated by
Section 4.01. The Registrar shall keep a register of the Registered Securities
of each series issued hereunder and of their transfer and exchange. The
Company may have one or more co-Registrars (provided that there shall be only
one register, which shall be maintained by the principal Registrar), one or
more additional paying agents and one or more additional conversion agents
with respect to any series. The term "Paying Agent" includes any additional
paying agent and the term "Conversion Agent" includes any additional
conversion agent.
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The Company shall enter into an appropriate agency agreement with any Agent
not a party to this Indenture. The agreement shall implement the provisions of
this Indenture that relate to such Agent. The Company shall promptly notify
the Trustee of the name and address of any such Agent. If the Company fails to
maintain a Registrar, Paying Agent or Conversion Agent, the Trustee shall act
as such.
The Company initially appoints the Trustee Registrar and Paying Agent for
each series and Conversion Agent for any series that is convertible.
The Trustee may appoint an Authenticating Agent or Agents with respect to
one or more series of Securities which shall be authorized to act on behalf of
the Trustee to authenticate Securities of such series issued upon original
issue or upon exchange, registration of transfer or partial redemption thereof
or pursuant to Section 2.09 and Securities so authenticated shall be entitled
to the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by the Trustee hereunder. Wherever reference is
made in this Indenture to the authentication and delivery of Securities by the
Trustee or the Trustee's certificate of authentication, such reference shall
be deemed to include authentication and delivery on behalf of the Trustee by
an Authenticating Agent and a certificate of authentication executed on behalf
of the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Company and shall at all times be a corporation organized
and doing business under the laws of the United States of America, any State
thereof or the District of Columbia, authorized under such laws to act as
Authenticating Agent, having a combined capital and surplus of not less than
$50,000,000 and subject to supervision or examination by Federal or State
authority. If such Authenticating Agent publishes reports of condition at
least annually pursuant to law or to the requirements of said supervising or
examining authority, then, for the purposes of this Section, the combined
capital and surplus of such Authenticating Agent shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
condition so published. If at any time an Authenticating Agent shall cease to
be eligible in accordance with the provisions of this Section, such
Authenticating Agent shall resign immediately in the manner and with the
effect specified in this Section.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating
Agent shall be a party, or any corporation succeeding to the corporate agency
or corporate trust business of such Authenticating Agent, shall continue to be
an Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any
further act on the part of the Trustee or such 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 the 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 written notice
of such appointment to all Holders of Securities of the series with respect to
which such Authenticating Agent will serve in the manner and to the extent
provided in Section 11.02. Any successor Authenticating Agent upon acceptance
of its appointment hereunder shall become vested with all the rights, powers
and duties of its predecessor hereunder, with like effect as if originally
named as an Authenticating Agent. No successor Authenticating Agent shall be
appointed unless eligible under the provisions of this Section.
The Company agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section.
If an appointment of an Authenticating Agent with respect to one or more
series is made pursuant to this Section, the Securities of such series may
have endorsed thereon, in addition to or in lieu of the Trustee's certificate
of authentication, an alternative certificate of authentication in the
following form:
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CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated herein and referred
to in the within-mentioned Indenture.
THE BANK OF NEW YORK as Trustee
By: _________________________________
As Authenticating Agent
By: _________________________________
Authorized Signatory
Section 2.06. Paying Agent to Hold Money and Securities in Trust.
Prior to each due date of a principal payment in respect of any Security,
the Company shall deposit with the Paying Agent a sum of money or securities
sufficient to make such payment when so becoming due. Each Paying Agent shall
hold in trust for the benefit of Securityholders of the relevant series or the
Trustee all money and securities held by the Paying Agent for the payment of
any amount in respect of the Securities of such series, and shall notify the
Trustee of any default by the Company in making any such payment. If the
Company or a Subsidiary acts as Paying Agent, it shall segregate such money
and securities and hold them as a separate trust fund. The Company at any time
may require a Paying Agent to pay all money and securities held by it to the
Trustee and account for any funds or securities disbursed. Upon doing so, the
Paying Agent shall have no further liability for the money or securities.
Section 2.07. Securityholder Lists.
The Trustee shall preserve in as current a form as is reasonably practicable
the most recent list available to it of the names and addresses of
Securityholders. If the Trustee is not the Registrar, the Company shall
furnish to the Trustee on or before either (1) April 1 and October 1 in each
year in the case of Original Issue Discount Securities of any series which by
their terms do not bear interest prior to maturity (other than upon a default
in any payment upon such a Security) or (2) the Interest Payment Date for
Securities of any other series, but in no event less frequently than semi-
annually, and at such other times as the Trustee may request in writing a list
in such form and as of such date as the Trustee may reasonably require of the
names and addresses of Securityholders included in the security register.
Section 2.08. Transfer and Exchange.
Upon presentation for registration of transfer of a Registered Security of
any series at the office or agency of the Company maintained for such purposes
in a place of payment for such series, the Company shall execute and the
Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Registered Securities of the same
series of any authorized denominations and of a like aggregate principal
amount, bearing a number not contemporaneously outstanding and containing
identical terms and provisions. Notwithstanding any other provision of this
Section, unless and until it is exchanged in whole or in part for Securities
in definitive form, a global Security representing all or a portion of the
Securities of or within a series may not be transferred except as a whole by
the depositary for such series to a nominee of such depositary or by a nominee
of such depositary to such depositary or another nominee of such depositary or
by such depositary or any such nominee to a successor depositary for such
series or a nominee of such successor depositary.
At the option of the Holder, Registered Securities of any series (other than
a global Security, except as provided below or as otherwise specified as
contemplated by Section 2.02) may be exchanged for other
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Registered Securities of the same series of any authorized denominations and
of a like aggregate principal amount and containing identical terms and
provisions, upon surrender of the Securities to be exchanged at any such
office or agency. Whenever any Securities are so surrendered for exchange, the
Company shall execute, and the Trustee shall authenticate and deliver, the
Securities which the Holder making the exchange is entitled to receive. Unless
otherwise specified with respect to any series of Securities as contemplated
by Section 2.02, Bearer Securities may not be delivered by the Trustee in
exchange for Registered Securities.
If so provided pursuant to Section 2.02 with respect to the Securities of
any series, at the option of the Holder, Bearer Securities of such series
(other than a global Security, except as provided below or as otherwise
specified as contemplated by Section 2.02) may be exchanged for Registered
Securities of such series containing identical terms of any authorized
denominations and of a like aggregate principal amount, upon surrender of the
Bearer Securities to be exchanged at any office or agency maintained by the
Company for such purpose in a place of payment for such series, with all
unmatured coupons and all matured coupons in default thereto appertaining. If
the Holder of a Bearer Security is unable to produce any unmatured coupon or
coupons or matured coupon or coupons in default, such exchange may be effected
if the Bearer Securities are accompanied by payment in funds acceptable to the
Company in an amount equal to the face amount of such missing coupon or
coupons, or the surrender of such missing coupon or coupons may be waived by
the Company and the Trustee if there is furnished to them such security or
indemnity as they may require to save each of them and any Paying Agent
harmless. If thereafter the Holder of such Security shall surrender to any
Paying Agent any such missing coupon in respect of which such a payment shall
have been made, such Holder shall be entitled to receive the amount of such
payment, provided, however, that, except as otherwise provided in Section
4.01, interest represented by coupons shall be payable only upon presentation
and surrender of those coupons at an office or agency located outside the
United States. Notwithstanding the foregoing, in case a Bearer Security of any
series is surrendered at any such office or agency for such series in exchange
for a Registered Security of the same series and like tenor after the close of
business at such office or agency (i) on any Regular Record Date and before
the opening of business at such office or agency on the relevant Interest
Payment Date, or (ii) on any special record date and before the opening of
business at such office or agency on the related date for payment of defaulted
interest, such Bearer Security shall be surrendered without the coupon
relating to such Interest Payment Date or proposed date of payment, as the
case may be, and interest or defaulted interest, as the case may be, will not
be payable on such Interest Payment Date or proposed date of payment, as the
case may be, in respect of the Registered Security issued in exchange for such
Bearer Security, but will be payable only to the Holder of such coupon in
accordance with the provisions of this Indenture.
Whenever any Securities are so surrendered for exchange pursuant to the
immediately preceding paragraph, the Company shall execute, and the Trustee
shall authenticate and deliver, the Securities which the Holder making the
exchange is entitled to receive.
Except as otherwise provided with respect to the Securities of any series as
contemplated by Section 2.02, a global Security may be exchanged only as
provided below in this Section.
If at any time the depositary with respect to a global Security representing
all or a portion of the Securities of or within a series notifies the Company
that it is unwilling, unable or ineligible to continue as such depositary, the
Company shall appoint a successor depositary with respect to such Securities.
Unless otherwise provided with respect to a series of Securities as
contemplated by Section 2.02, if a successor depositary is not so appointed by
the Company within 90 days after the Company receives such notice, the Company
will execute and the Trustee, upon receipt of a written order of the Company
as contemplated by Section 2.04 for the authentication and delivery of
definitive Securities of such series (or, if such written order has previously
been delivered, then upon receipt of written instructions from the person or
persons specified in such written order), will authenticate and deliver
Securities of such series in definitive form equal in aggregate principal
amount to the principal amount of the global Security or Securities
representing such series in exchange for such global Security or Securities.
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The Company may at any time and in its sole discretion determine that the
Securities of any series issued in the form of one or more global Securities
shall no longer be represented by such global Security or Securities. In such
event the Company will execute and the Trustee, upon receipt of a written
order of the Company as contemplated by Section 2.04 for the authentication
and delivery of definitive Securities of such series (or, if such written
order has previously been delivered, then upon receipt of written instructions
from the person or persons specified in such written order), will authenticate
and deliver Securities of such series in definitive form equal in aggregate
principal amount to the principal amount of the global Security or Securities
representing such series in exchange for such global Security or Securities.
If a global Security is otherwise exchangeable as specified by the Company
pursuant to Section 2.02(3) with respect to a series of Securities, the
depositary with respect to a global Security representing all or a portion of
the Securities of or within such series may surrender such global Security to
the Trustee, as the Company's agent for such purpose, to be exchanged in whole
or in part for Securities of such series in definitive form in the manner and
under the circumstances so specified and on such terms as are acceptable to
the Company and such depositary. In such event, the Company shall execute and
the Trustee shall authenticate and deliver or make available for delivery:
(i) to each person specified by such depositary a new Security or
Securities of the same series and of like tenor, of any authorized form and
denomination as requested by such person in aggregate principal amount
equal to and in exchange for such person's beneficial interest in the
global Security; and
(ii) unless endorsement of the surrendered global Security as
contemplated by Section 2.10 or another procedure is specified for the
Securities of such series as contemplated by Section 2.02, to such
depositary a new global Security in a denomination equal to the difference,
if any, between the principal amount of the surrendered global Security and
the aggregate principal amount of Securities delivered pursuant to clause
(i) above in exchange for beneficial interests in such surrendered global
Security.
In any exchange provided for in any of the preceding three paragraphs, the
Company will execute and the Trustee will authenticate and deliver Securities
(a) in definitive registered form in authorized denominations if the
Securities of such series are issuable as Registered Securities, (b) in
definitive bearer form in authorized denominations if the Securities of such
series are issuable as Bearer Securities or (c) as either Registered or Bearer
Securities, if the Securities of such series are issuable in either form;
provided, however, that no definitive Bearer Security shall be delivered in
exchange for a portion of a global Security except in compliance with the
conditions set forth in Section 2.04 or specified with respect to the
Securities of such series as contemplated by Section 2.02 (including
certification requirements and requirements with respect to delivery outside
the United States).
Upon the exchange of a global Security for Securities in definitive form,
such global Security shall be cancelled by the Trustee, unless endorsement of
the surrendered global Security as contemplated by Section 2.10 or another
procedure is specified for the Securities of such series as contemplated by
Section 2.02. Registered Securities issued in exchange for a global Security
pursuant to this Section shall be registered in such names and in such
authorized denominations as the depositary for such global Security, pursuant
to instructions from its direct or indirect participants or otherwise, shall
instruct the Trustee. The Trustee shall deliver such Registered Securities to
the persons in whose names such Securities are so registered. Subject to the
proviso clause of the immediately preceding paragraph, the Trustee shall
deliver Bearer Securities issued in exchange for a global Security pursuant to
this Section to the persons, and in such authorized denominations, as the
depositary for such global Security, pursuant to instructions from its direct
or indirect participants or otherwise, shall instruct the Trustee.
If a Registered Security is issued in exchange for any portion of a global
Security after the close of business at the office or agency where such
exchange occurs (i) on any Regular Record Date and before the opening of
business at such office or agency on the relevant Interest Payment Date, or
(ii) on any special record date and before the opening of business at such
office or agency on the related date for payment of defaulted interest,
interest or defaulted interest, as the case may be, will not be payable on
such Interest Payment Date or proposed
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date for payment, as the case may be, in respect of such Registered Security,
but will be payable on such Interest Payment Date or proposed date for
payment, as the case may be, only to the person to whom interest in respect of
such portion of such global Security is payable in accordance with the
provisions of this Indenture.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the
Securities surrendered upon such registration of transfer or exchange.
Every Registered Security presented or surrendered for registration of
transfer or for exchange shall be duly endorsed, or be accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Registrar duly executed, by the Holder thereof or his attorney duly authorized
in writing.
No service charge shall be made for any registration of transfer or exchange
of Securities, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto.
The Company shall not be required to issue, register the transfer of or
exchange Securities of any series during a period beginning at the opening of
business 15 days before any selection of Securities of that series to be
redeemed and ending at the close of business on (A) if Securities of the
series are issuable only as Registered Securities, the date of the mailing of
the relevant notice of redemption and (B) if Securities of the series are
issuable as Bearer Securities, the date of the first publication of the
relevant notice of redemption or, if Securities of such series are also
issuable as Registered Securities and there is no publication, the date of the
mailing of the relevant notice of redemption. Further, the Company shall not
be required to register the transfer of or exchange any Security selected for
redemption or purchase (except, in the case of Securities to be redeemed or
purchased in part, the portion thereof not to be redeemed or purchased), and
the Company shall not be required to issue, register the transfer of or
exchange any Security in respect of which a notice requiring the purchase or
redemption thereof by the Company at the option of the Holder has been given
and not withdrawn by the Holder thereof in accordance with the terms of such
Securities (except, in the case of Securities to be so purchased or redeemed
in part, the potion thereof not to be so purchased or redeemed); provided,
however, that a Bearer Security so selected for redemption or purchase or in
respect of which a notice requiring the purchase or redemption thereof by the
Company at the option of the Holder has been given and not so withdrawn may,
if so provided with respect to the Securities of such series as contemplated
by Section 2.02, be exchanged for a Registered Security of that series and
like tenor, provided that such Registered Security shall simultaneously be
surrendered for redemption or purchase, as the case may be, with written
instructions for payment consistent with the provisions of this Indenture.
Section 2.09. Replacement Securities.
If (i) a mutilated Security or a Security with a mutilated coupon
appertaining to it is surrendered to the Trustee or (ii) the Company and the
Trustee receive evidence to their satisfaction that a Security or coupon
appertaining thereto has been lost, destroyed or wrongfully taken, and there
is delivered to the Company and the Trustee such security or indemnity as may
be required by them to save each of them and any Agent harmless, then, in the
absence of notice to the Company or the Trustee that such Security or coupon
has been acquired by a bona fide purchaser, and if the Trustee's requirements
are met, the Company shall execute and upon its written request the Trustee
shall authenticate and deliver, in exchange for any such mutilated Security or
Security with a mutilated coupon appertaining to it or to which a lost,
destroyed or wrongfully-taken coupon appertains (with all appurtenant coupons
not lost, destroyed or wrongfully taken) or in lieu of any such lost,
destroyed or wrongfully-taken Security, a new Security of the same series
containing identical terms and of like principal amount and bearing a number
not contemporaneously outstanding, with coupons corresponding to the coupons,
if any, appertaining to the surrendered Security or to the lost, destroyed or
wrongfully-taken Security or to the Security to which such lost, destroyed or
wrongfully-taken coupon appertains, as applicable, provided, however, that
delivery of a Bearer Security shall occur only outside the United States.
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In case any such mutilated, lost, destroyed or wrongfully-taken Security or
coupon has become or is about to become due and payable, or is about to be
purchased by the Company pursuant to any provision of the Securities of such
series providing for the purchase thereof at the option of the Holder or the
Company, the Company in its discretion may, instead of issuing a new Security,
pay or purchase such Security or pay such coupon, as applicable; provided,
however, that payment of principal of, any interest on or any Additional
Amounts with respect to any Bearer Securities shall, except as otherwise
provided in Section 4.01, be payable only at an office or agency for
Securities of such series located outside the United States and, unless
otherwise provided in or pursuant to this Indenture, any interest on Bearer
Securities and any Additional Amounts with respect to such interest shall be
payable only upon presentation and surrender of the coupons appertaining
thereto.
Upon the issuance of any new Security under this Section, the Company may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses
(including the fees and expenses of the Trustee) connected therewith.
Every new Security, with any coupons appertaining thereto, issued pursuant
to this Section in lieu of any lost, destroyed or wrongfully-taken Security,
or in exchange for a Security to which a lost, destroyed or wrongfully-taken
coupon appertains, shall constitute a separate obligation of the Company,
whether or not the lost, destroyed or wrongfully-taken Security and coupons
appertaining thereto or the lost, destroyed or wrongfully-taken coupon shall
be at any time enforceable by anyone, and shall be entitled to all the
benefits of this Indenture equally and proportionately with any and all other
Securities of such series and any coupons, if any, duly issued hereunder.
The provisions of this Section, as amended or supplemented pursuant to this
Indenture with respect to particular Securities or generally, shall be
exclusive and shall preclude (to the extent lawful) all other rights and
remedies with respect to the replacement or payment of mutilated, lost,
destroyed or wrongfully-taken Securities or coupons.
Section 2.10. Securities in Global Form.
If the Company shall establish pursuant to Section 2.02 that the Securities
of or within a series are to be issued in whole or in part in global form,
then the Company shall execute, and the Trustee shall, in accordance with
Section 2.04 and the written order of the Company contemplated thereby,
authenticate and deliver one or more global Securities in temporary or
permanent form that (i) shall be registered, if in registered form, in the
name of the depositary for such global Security or Securities or the nominee
of such depositary, (ii) shall be delivered by the Trustee to such depositary
or pursuant to such depositary's instructions, and (iii) shall bear a legend
substantially to the following effect: "Unless and until it is exchanged in
whole or in part for Securities in definitive form, this Security may not be
transferred except as a whole by the depositary to a nominee of the depositary
or by a nominee of the depositary to the depositary or another nominee of the
depositary or by the depositary or any such nominee to a successor depositary
or a nominee of such successor depositary." Each depositary designated
pursuant to Section 2.02 for a global Security in registered form must be, to
the extent required by applicable law or regulation, a clearing agency
registered under the Securities Exchange Act of 1934, as amended, and any
other applicable statute or regulation, at the time of its designation and at
all times that it serves as depositary. Notwithstanding clause (14) of Section
2.02 and the provisions of Section 2.03, any such global Security shall
represent such of the outstanding Securities of such series as shall be
specified therein and may provide that it shall represent the aggregate amount
of outstanding Securities of such series from time to time endorsed thereon
and that the aggregate amount of outstanding Securities represented thereby
may from time to time be increased or decreased to reflect exchanges. Any
endorsement of a Security in global form to reflect the amount, or any
increase or decrease in the amount, or changes in the rights of Holders, of
outstanding Securities represented thereby shall be made in such manner and
upon instructions given by such person or persons as shall be specified
therein or in the written order of the Company to be delivered to the Trustee
pursuant to Section 2.04. Subject to the provisions of Section 2.04 and, if
applicable, Section 2.11, the Trustee
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shall deliver and redeliver any Security in permanent global form in the
manner and upon instructions given by the person or persons specified therein
or in the applicable written order of the Company. If a written order of the
Company pursuant to Section 2.04 has been, or simultaneously is, delivered,
any instructions with respect to a Security in global form shall be in writing
but need not comply with Sections 11.04 and 11.05 and need not be accompanied
by an Opinion of Counsel.
The provisions of the last sentence of the third paragraph of Section 2.04
shall apply to any Security represented by a Security in global form if such
Security was never issued and sold by the Company and the Company delivers to
the Trustee the Security in global form together with written instructions
(which need not comply with Sections 11.04 and 11.05 and need not be
accompanied by an Opinion of Counsel) with regard to the reduction in the
principal amount of Securities represented thereby, together with the written
statement contemplated by the last sentence of the third paragraph of Section
2.04.
Section 2.11. Temporary Securities.
Pending the preparation of a permanent global Security or definitive
Securities of any series, the Company may execute and the Trustee, upon the
written order of the Company pursuant to Section 2.04, shall authenticate and
deliver temporary Securities. Temporary Securities of any series shall be in
authorized denominations and substantially of the tenor of the definitive
Securities of that series in lieu of which they are issued, in registered form
or, if authorized, in bearer form with one or more coupons or without coupons,
but may have variations that the Company considers appropriate for temporary
Securities. In the case of Securities of any series, such temporary Securities
may be in global form. If temporary Securities of any series are issued, the
Company will cause definitive Securities of that series to be prepared without
unreasonable delay. Except as otherwise specified as contemplated by Section
2.02 with respect to Securities of a series issuable as Bearer Securities, (a)
after the preparation of definitive Securities of such series, the temporary
Securities of such series shall be exchangeable for definitive Securities of
such series upon surrender of the temporary Securities of such series at the
office or agency of the Company maintained for such purpose in a place of
payment for such series, without charge to the Holder, and (b) upon surrender
for cancellation of any one or more temporary Securities of any series
(accompanied by any unmatured coupons appertaining thereto) the Company shall
execute and the Trustee shall authenticate and deliver in exchange therefor a
like aggregate principal amount of definitive Securities of authorized
denominations of the same series and containing identical terms and
provisions; provided, however, that, unless otherwise specified as
contemplated by Section 2.02, no definitive Bearer Security shall be delivered
in exchange for a temporary Registered Security and provided, further, that
neither a beneficial interest in a permanent global Security in bearer form
nor a definitive Bearer Security shall be delivered in exchange for a
temporary Security except in compliance with all applicable conditions set
forth in Section 2.04 or specified as contemplated by Section 2.02 (including
certification requirements and requirements with respect to delivery outside
the United States). Until so exchanged, the temporary Securities of any series
shall, except as otherwise specified as contemplated by Section 2.02
(including with respect to the payment of interest on temporary Securities),
in all respects be entitled to the same benefits under this Indenture as
definitive Securities of the same series and of like tenor authenticated and
delivered hereunder.
Section 2.12. Cancellation.
The Company at any time may deliver Securities and all coupons, if any,
appertaining thereto to the Trustee (or to an other person for delivery to the
Trustee) for cancellation, including Securities authenticated which the
Company has not issued and sold. The Company and each Agent shall forward to
the Trustee for cancellation any Securities and coupons surrendered to them
for transfer, exchange, payment, redemption, purchase by the Company pursuant
to any provision thereof providing for such purchase at the option of the
Holder, or conversion. The Trustee and no one else shall cancel all Securities
and coupons surrendered for transfer, exchange, payment, redemption, purchase,
conversion or cancellation, and may dispose of cancelled Securities and
coupons as the Company directs, provided, however, that the Trustee shall not
be required to destroy such cancelled Securities. Except as otherwise provided
in the resolution of the Board of Directors or indenture supplemental hereto
establishing such series as contemplated by Section 2.02, the Company may not
issue new Securities of a series to replace Securities of the same series that
it has paid or that have been delivered to the Trustee for cancellation.
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Section 2.13. Payment of Interest; Defaulted Interest.
Unless otherwise provided with respect to the Securities of any series as
contemplated by Section 2.02, interest (except defaulted interest) on any
Registered Security of any series which is payable on any Interest Payment
Date shall be paid to the Holder in whose name that Security (or one or more
Predecessor Securities) is registered on the security register at the close of
business on the Regular Record Date for such interest payment. At the option
of the Company, payment of interest on any Registered Security may be made (i)
by check mailed to the address of the person entitled thereto as such address
appears in the security register, or (ii) if so specified with respect to the
Securities of such series as contemplated by Section 2.02, by wire transfer to
an account designated by such person.
Unless otherwise provided with respect to the Securities of any series as
contemplated by Section 2.02, if the Company defaults in a payment of interest
on the Registered Securities of any series on any Interest Payment Date, it
shall pay the defaulted interest to the persons who are Securityholders of
such series at the close of business on a subsequent special record date. The
Company shall fix the record date and payment date. At least 15 days before
the record date, the Company shall mail to each Securityholder of such series
a notice that states the record date, the payment date and the amount of
defaulted interest to be paid. The Company shall notify the Trustee in writing
of the amount of defaulted interest proposed to be paid on each Registered
Security of such series and the date of the proposed payment, and at the same
time the Company shall deposit with the Paying Agent 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 Paying Agent for such
deposit prior to the date of the proposed payment. The Company may pay
defaulted interest in any other lawful manner.
Unless otherwise provided with respect to the Registered Securities of any
series as contemplated by Section 2.02, in the case of any Registered Security
of any series which is converted after any Regular Record Date and on or prior
to the next succeeding Interest Payment Date (other than any Registered
Security which is due and payable prior to such Interest Payment Date),
interest which is due and payable on such Interest Payment Date shall be
payable on such Interest Payment Date notwithstanding such conversion, and
such interest shall be paid to the Holder in whose name that Registered
Security is registered at the close of business on such Regular Record Date.
If any Bearer Security of a series is surrendered in exchange for a
Registered Security of such series at an office or agency maintained by the
Company for such purpose in a place of payment for such series after the close
of business at such office or agency (i) on any Regular Record Date and before
the opening of business at such office or agency on the relevant Interest
Payment Date or (ii) on any special record date and before the opening of
business at such office or agency on the related date for payment of defaulted
interest, such Bearer Security shall be surrendered without the coupon
relating to such Interest Payment Date or proposed date of payment, as the
case may be, and interest or defaulted interest, as the case may be, will not
be payable on such Interest Payment Date or proposed date of payment, as the
case may be, in respect of the Registered Security issued in exchange for such
Bearer Security, but will be payable only to the Holder of such coupon when
due in accordance with the provisions of this Indenture. Unless otherwise
specified with respect to the Securities of any series pursuant to Section
2.02, any interest due on any Bearer Security on or before the maturity
thereof, and any Additional Amounts payable with respect to such interest,
shall be payable only upon presentation of the coupons appertaining thereto
for such interest as they severally mature. Unless otherwise specified with
respect to the Securities of any series pursuant to Section 2.02, at the
option of the Company, payment of interest on any Bearer Security may be made
by check (provided the same is not mailed to an address inside the United
States) or by wire transfer to an account located outside the United States
maintained by the payee.
Section 2.14. Persons Deemed Owners.
Prior to due presentment of a Registered Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the person in whose name such Registered Security is registered as
the owner of such Registered Security for the purpose of receiving payment of
principal of, and
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(subject to Sections 2.08 and 2.13) interest on and any Additional Amounts
with respect to, such Registered Security and for all other purposes
whatsoever, whether or not any payment with respect to such Registered
Security shall be overdue, and neither the Company, nor the Trustee or any
agent of the Company or the Trustee shall be affected by notice to the
contrary.
Title to any Bearer Security and any coupons appertaining thereto shall pass
by delivery. The Company, the Trustee and any agent of the Company or the
Trustee may treat the bearer of any Bearer Security or the bearer of any
coupon as the absolute owner of such Security or coupon for the purpose of
receiving payment thereof or on account thereof and all other purposes
whatsoever, whether or not any payment with respect to such Security or coupon
shall be overdue, and neither the Company, nor the Trustee or any agent of the
Company or the Trustee shall be affected by notice to the contrary.
No holder of any beneficial interest in any global Security held on its
behalf by a depositary shall have any rights under this Indenture with respect
to such global Security, and such depositary (or its nominee, if such global
Security is in registered form and is registered in the name of a nominee) may
be treated by the Company, the Trustee, and any agent of the Company or the
Trustee as the owner of such global Security for all purposes whatsoever;
provided, however, that, if so specified as contemplated by Section 2.02, the
Company, the Trustee and any agent of the Company or the Trustee shall, to the
extent so specified, treat the clearing organization or organizations for
whose account a portion of a permanent global Security in bearer form is held
by the depositary thereof as the owner of the applicable portion of such
global Security. None of the Company, the Trustee, any Paying Agent or the
Registrar will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests of a global Security or for maintaining, supervising or reviewing
any records relating to such beneficial ownership interests.
Notwithstanding the foregoing, with respect to any global Security, nothing
herein shall prevent the Company, the Trustee, or any agent of the Company or
the Trustee, from giving effect to any written certification, proxy or other
authorization furnished by any depositary, as a Holder, with respect to such
global Security or impair, as between such depositary and owners of beneficial
interests in such global Security, the operation of customary practices
governing the exercise of the rights of such depositary (or its nominee) as
Holder of such global Security.
ARTICLE THREE
Redemption
Section 3.01. Applicability of Article.
Securities of any series which are redeemable before their stated maturity
at the election of the Company or through the operation of any sinking fund
for the retirement of Securities of such series shall be redeemable in
accordance with their terms and (except as otherwise specified as contemplated
by Section 2.02 for Securities of any series) in accordance with this Article.
Section 3.02. Notices to Trustee.
If the Company elects to redeem all or less than all the Securities of any
series, it shall notify the Trustee of the redemption date, the principal
amount of Securities to be redeemed, the specific provision of the Securities
pursuant to which the Securities being called for redemption are being
redeemed and the redemption price. In the case of any redemption of Securities
prior to the expiration of any restriction on such redemption provided in the
terms of such Securities or elsewhere in this Indenture, the Company shall
furnish the Trustee with an Officers' Certificate evidencing compliance with
such restriction. If the Company wants to make any permitted optional sinking
fund payment, it shall notify the Trustee of the principal amount of the
Securities to be redeemed.
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The Company (1) may deliver outstanding Securities of a series (other than
any previously called for redemption), together in the case of any Bearer
Securities of such series with all unmatured coupons appertaining thereto, and
(2) may apply as a credit Securities of a series which (i) have been redeemed
or otherwise purchased either at the election of the Company pursuant to the
terms of such Securities or through the application of permitted optional
sinking fund payments pursuant to the terms of such Securities or (ii) have
been converted pursuant to the terms of such Securities, in each case in
satisfaction of all or any part of any sinking fund payment required to be
made pursuant to the terms of the Securities of such series as provided for by
the terms of such series; provided that such Securities have not been
previously so credited. Such Securities shall be received and credited for
such purpose by the Trustee at the redemption price specified in such
Securities for redemption through operation of the sinking fund and the amount
of such sinking fund payment shall be reduced accordingly. The Company shall
notify the Trustee of its intention to so reduce the amount of such sinking
fund payment, the amount of the reduction and the basis for it. The Company
shall deliver to the Trustee with such notice any Securities to be credited
for such purpose that it has not previously delivered to the Trustee for
cancellation.
The Company shall give each notice and Officers' Certificate provided for in
this Section at least 60 days before the redemption date (unless a shorter
notice shall be satisfactory to the Trustee or is otherwise specified as
contemplated by Section 2.02 for Securities of any series).
Section 3.03. Selection of Securities to be Redeemed.
Except as otherwise specified as contemplated by Section 2.02 for Securities
of any series, if less than all the Securities of any series are to be
redeemed, the particular Securities to be redeemed shall be selected from
Securities of the same series outstanding not previously called for redemption
by lot or by such method as the Trustee considers fair and appropriate (and in
such manner as complies with applicable requirements of any stock exchange on
which Securities of such series are listed) and which may provide for the
selection for redemption of portions (equal to the minimum authorized
denomination for Securities of that series or any integral multiple thereof)
of the principal amount of Securities of such series that have denominations
larger than the minimum authorized denomination for Securities of that series.
Provisions of this Indenture that apply to Securities called for redemption
also apply to portions of Securities called for redemption. If any Security
selected for partial redemption is converted in part after such selection but
before the termination of the conversion right with respect to the portion of
the Security so selected, the converted portion of such Security shall be
deemed (so far as may be practicable) to be the portion selected for
redemption.
Section 3.04. Notice of Redemption.
At least 30 days but not more than 60 days before a redemption date (unless
a shorter notice is specified as contemplated by Section 2.02 for the
Securities of any series), the Company shall provide a notice of redemption in
the manner provided in Section 11.02 to the Holders of Securities.
The notice shall identify the Securities (including CUSIP number, if any
and, in the case of partial redemption, the principal amount of the
Securities) to be redeemed and shall state:
(1) the redemption date;
(2) the redemption price and method of payment, if other than in cash;
(3) if applicable, the then current conversion price or rate;
(4) the name and address of the Paying Agent and, if applicable, the
Conversion Agent;
(5) if applicable, that the right of the Holder to convert Securities
called for redemption shall terminate at the close of business on the
fifteenth day prior to the redemption date (or such other day as may be
specified as contemplated by Section 2.02 for Securities of any series);
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(6) if applicable, that Holders who want to convert Securities called for
redemption must satisfy the requirements for conversion contained in such
Securities;
(7) that Securities called for redemption must be surrendered (together
in the case of Bearer Securities with all coupons appertaining thereto, if
any, maturing after the redemption date) to the Paying Agent to collect the
redemption price;
(8) that interest, if any (or original issue discount, if Original Issue
Discount Securities) on Securities called for redemption ceases to accrue
on and after the redemption date, unless the Company defaults in making
such redemption payment; and
(9) that the redemption is for a sinking fund or at the election of the
Company, whichever is the case.
A notice of redemption published as contemplated by Section 11.02 need not
identify particularly Registered Securities to be redeemed.
At the Company's request, the Trustee shall give the notice of redemption in
the Company's name and at the Company's expense, provided that the Company
shall have furnished to the Trustee the Officers' Certificate and Opinion of
Counsel required pursuant to Section 11.04 at least 15 days prior to the date
that the Trustee is required to take any action in connection with a
redemption.
Section 3.05. Effect of Notice of Redemption.
Once notice of redemption is provided, Securities of the series called for
redemption become due and payable on the redemption date and at the redemption
price therein specified and on and after such date (unless the Company shall
default in the payment of the redemption price and accrued interest, if any)
such Securities shall cease to bear interest, if any (and original issue
discount, if such Securities are Original Issue Discount Securities, shall
cease to accrue) and the coupons for such interest appertaining to any Bearer
Securities so to be redeemed, except to the extent provided below, shall be
void. Upon surrender of any such Security for redemption in accordance with
said notice, together with all coupons, if any, appertaining thereto maturing
after the redemption date, such Security shall be paid by the Company at the
redemption price, together with the accrued interest to the redemption date,
provided, however, that installments of interest on Bearer Securities whose
stated maturity is on or prior to the redemption date shall be payable only at
an office or agency maintained by the Company in a place of payment located
outside the United States (except as otherwise provided in Section 4.01) and,
unless otherwise specified as contemplated by Section 2.02, only upon
presentation and surrender of the coupons for such interest, and, provided,
further, that unless otherwise specified as contemplated by Section 2.02,
installments of interest on Registered Securities whose stated maturity is on
or prior to the redemption date shall be payable to the Holders of such
Securities, or one or more Predecessor Securities, registered as such at the
close of business on the relevant Regular Record Date or special record date,
as the case may be, according to their terms and the provisions of Section
2.13.
If any Bearer Security surrendered for redemption shall not be accompanied
by all appurtenant coupons maturing after the redemption date, such Security
may be paid after deducting from the redemption price an amount equal to the
face amount of all such missing coupons, or the surrender of such missing
coupon or coupons may be waived by the Company and the Trustee if there be
furnished to them such security or indemnity as they may require to save each
of them and any Paying Agent harmless. If thereafter the Holder of such
Security shall surrender to the Trustee or any Paying Agent any such missing
coupon in respect of which a deduction shall have been made from the
redemption price, such Holder shall be entitled to receive the amount so
deducted; provided, however, that interest represented by coupons shall be
payable only at an office or agency located outside the United States (except
as otherwise provided in Section 4.01) and, unless otherwise specified as
contemplated by Section 2.02, only upon presentation and surrender of those
coupons.
If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal shall, until paid, bear interest from
the redemption date at the rate prescribed therefor in the Security.
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Section 3.06. Deposit of Redemption Price.
On or before 10 a.m., New York time, on the redemption date, the Company
shall deposit with the Paying Agent money in immediately available funds (or
securities if permitted by the terms of such Securities) sufficient to pay the
redemption price of, and (except if the redemption date is an Interest Payment
Date) accrued interest, if any, on all Securities to be redeemed on that date
other than Securities or portions thereof called for redemption on that date
which are delivered by the Company to the Trustee for cancellation. The Paying
Agent shall return to the Company any money (or securities) not required for
that purpose because of conversion of Securities.
Section 3.07. Securities Redeemed in Part.
Any Registered Security that is to be redeemed only in part shall be
surrendered at a place of payment therefor (with, if the Company, the
Registrar or the Trustee so requires, due endorsement by, or a written
instrument of transfer in form satisfactory to the Company, the Registrar and
the Trustee duly executed by, the Holder thereof or his attorney duly
authorized in writing), and the Company shall execute, and the Trustee shall
authenticate and deliver to the Holder of such Security without service
charge, a new Registered Security or Registered Securities of the same series,
containing identical terms and provisions, 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 amount of the Security so
surrendered, and, otherwise specified as contemplated by Section 2.02, if a
global Security is so surrendered, the Company shall execute, and the Trustee
shall authenticate and deliver to the depositary for such global Security,
without service charge, a new global Security in a denomination equal to an in
exchange for the unredeemed portion of the principal amount of the global
Security so surrendered.
Section 3.08. Conversion Arrangement on Call for Redemption.
In connection with any redemption of Securities, the Company may arrange for
the purchase and conversion of any Securities called for redemption by an
agreement with one or more investment bankers or other purchasers to purchase
such Securities by paying to the Trustee in trust for the Securityholders, on
or before the close of business on the redemption date, an amount in cash not
less than the redemption price, together with interest, if any, accrued to the
redemption date, of such Securities. Notwithstanding anything to the contrary
contained in this Article Three, the obligation of the Company to pay the
redemption price of such Securities, including all accrued interest, if any,
shall be deemed to be satisfied and discharged to the extent such amount is so
paid by such purchasers. If such an agreement is entered into, any Securities
not duly surrendered for conversion by the Holders thereof may, at the option
of the Company, be deemed, to the fullest extent permitted by law, acquired by
such purchasers from such Holders and (notwithstanding anything to the
contrary contained in Article Ten) surrendered by such purchasers for
conversion, all as of immediately prior to the close of business on the last
day on which Securities of such series called for redemption may be converted
in accordance with this Indenture and the terms of such Securities, subject to
payment of the above amount as aforesaid. The Trustee shall hold and pay to
the Holders whose Securities are selected for redemption any such amount paid
to it in the same manner as it would moneys deposited with it by the Company
for the redemption of Securities. Without the Trustee's prior written consent,
no arrangement between the Company and such purchasers for the purchase and
conversion of any Securities shall increase or otherwise affect any of the
powers, duties, responsibilities or obligations of the Trustee as set forth in
this Indenture, and the Company agrees to indemnify the Trustee from, and hold
it harmless against, any loss, liability or expense arising out of or in
connection with any such arrangement for the purchase and conversion of any
Securities between the Company and such purchasers, including the costs and
expenses incurred by the Trustee in the defense of any claim or liability
arising out of or in connection with the exercise or performance of any of its
powers, duties, responsibilities or obligations under this Indenture.
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ARTICLE FOUR
Covenants
Section 4.01. Payment of Securities; Maintenance of Office or Agency.
The Company shall pay the principal of and any interest on the Securities of
each series in accordance with the terms of the Securities of such series, any
coupons appertaining thereto, and this Indenture.
To the extent enforceable under applicable law, the Company shall pay
interest on overdue principal at the rate borne by the Securities of such
series (unless a different rate is specified as contemplated by Section 2.02
for Securities of such series).
If Securities of a series are issuable only as Registered Securities, the
Company will maintain in each place of payment for such series an office or
agency where Securities of that series may be presented or surrendered for
payment, where Securities of that series may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the Company in
respect of the Securities of that series and this Indenture may be served. If
Securities of a series are issuable as Bearer Securities, the Company will
maintain (A) in the Borough of Manhattan, The City of New York, an office or
agency where any Registered Securities of that series may be presented or
surrendered for payment, where any Registered Securities of that series may be
surrendered for registration of transfer, where Securities of that series may
be surrendered for exchange, where notices and demands to or upon the Company
in respect of the Securities of that series and this Indenture may be served
and where Bearer Securities of that series and related coupons may be presented
or surrendered for payment in the circumstances described in the following
paragraph (and not otherwise), (B) subject to any laws or regulations
applicable thereto, in a place of payment for that series which is located
outside the United States, an office or agency where Securities of that series
and related coupons may be presented and surrendered for payment (including
payment of any Additional Amounts payable on Securities of that series);
provided, however, that if the Securities of that series are listed on The
International Stock Exchange of the United Kingdom and the Republic of Ireland,
the Luxembourg Stock Exchange or any other stock exchange located outside the
United States and such stock exchange shall so require, the Company will
maintain a Paying Agent for the Securities of that series in London, Luxembourg
or any other required city located outside the United States, as the case may
be, so long as the Securities of that series are listed on such exchange, and
(C) subject to any laws or regulations applicable thereto, in a place of
payment for that series located outside the United States an office or agency
where any Registered Securities of that series may be surrendered for
registration of transfer, where Securities of that series may be surrendered
for exchange and where notices and demands to or upon the Company in respect of
the Securities of that series and this Indenture may be served. The Company
will give prompt written notice to the Trustee and the Holders of the location,
and any change in the location, of any such office or agency. If at any time
the Company shall fail to maintain any such required office or agency in
respect of any series of Securities or shall fail to furnish the Trustee with
the address thereof, such presentations and surrenders of Securities of that
series may be made and notices and demands may be made or served at the
corporate trust office of the Trustee, except that Bearer Securities of that
series and the related coupons shall be presented and surrendered for payment
(including payment of any additional amounts payable on Bearer Securities of
that series) at The Bank of New York, 46 Berkeley Street, London W1X 6AA,
England, and the Company hereby appoints the same as its agency to receive such
respective presentations, surrenders, notices and demands.
No payment of principal of or interest on Bearer Securities shall be made at
any office or agency of the Company in the United States or by check mailed to
any address in the United States or by transfer to an account maintained with a
bank located in the United States, provided, however, that, if the Securities
of a series are denominated and payable in Dollars, payment of principal of and
interest on any Bearer Security (including any additional amounts payable on
Securities of such series) shall be made at the office of the Company's Paying
Agent in the Borough of Manhattan, The City of New York, if (but only if)
payment in Dollars of the full amount of such principal of or interest on or
additional amounts, as the case may be, at all offices or agencies outside the
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United States maintained for that purpose by the Company in accordance with
this Indenture is illegal or effectively precluded by exchange controls or
other similar restrictions.
The Company may also from time to time designate one or more other offices or
agencies where the Securities of one or more series may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; provided, however, that no such designation or rescission shall
in any manner relieve the Company of its obligation to maintain an office or
agency in accordance with the requirements set forth above for Securities of
any series for such purposes. The Company will give prompt written notice to
the Trustee and the Holders of any such designation or rescission and of any
change in the location of any such other office or agency.
If any Securities of a series provide for the payment of Additional Amounts,
the Company will pay to the Holder of any such Security of such series or any
coupon appertaining thereto Additional Amounts as provided therein. Whenever in
this Indenture there is mentioned, in any context, the payment of the principal
of or interest on or in respect of, any Security of any series or payment of
any related coupon or the net proceeds received on the sale or exchange of any
Security of any series, such mention shall be deemed to include mention of the
payment of Additional Amounts provided for in the terms of such Securities and
this Section to the extent that, in such context, Additional Amounts are, were
or would be payable in respect thereof pursuant to such terms and this Section
and express mention of the payment of Additional Amounts (if applicable) in any
provisions hereof shall not be construed as excluding Additional Amounts in
those provisions hereof where such express mention is not made.
Except as otherwise provided with respect to the Securities of any series as
contemplated by Section 2.02, if the Securities of a series provide for the
payment of Additional Amounts, at least 10 days prior to the first Interest
Payment Date with respect to that series of Securities (or if the Securities of
that series will not bear interest prior to the maturity thereof, the first day
on which a payment of principal is made), and at least 10 days prior to each
date of payment of principal or interest if there has been any change with
respect to the matters set forth in the below-mentioned Officers' Certificate,
the Company will furnish the Trustee and the principal Paying Agent or Paying
Agents, if other than the Trustee, with an Officers' Certificate instructing
the Trustee and such Paying Agent or Paying Agents whether such payment of
principal or interest on the Securities of that series shall be made to Holders
of Securities of that series or any related coupons who are United States
Aliens without withholding for or on account of any tax, assessment or other
governmental charge described in the Securities of that series. If any such
withholding shall be required, then such Officers' Certificate shall specify by
country the amount, if any, required to be withheld on such payments to such
Holders of Securities or coupons and the Company will pay to the Trustee or
such Paying Agent the Additional Amounts required by the terms of such
Securities and this Section. The Company covenants to indemnify the Trustee and
any Paying Agent for, and to hold them harmless against, any loss, liability or
expense reasonably incurred without negligence or bad faith on their part
arising out of or in connection with actions taken or omitted by any of them in
reliance on any Officers' Certificate furnished pursuant to this Section.
Section 4.02. Change of Control.
(a) With respect to the Securities of any series, in the event that (i) a
Change of Control shall occur at any time after the date on which the
Securities of such series are first issued under this Indenture and on or prior
to the maturity thereof (or during such other period as may be specified as
contemplated by Section 2.02 for Securities of such Series) and (ii) on any
date which occurs during the period commencing 90 days before and ending 90
days after the date that a public filing has been made with the SEC or other
general public disclosure has been made indicating the occurrence of such
Change of Control, the then current rating of the Securities of such series by
Duff & Phelps Credit Rating Co. or its successor ("D&P") or by Moody's
Investors Service, Inc. or its successor ("Moody's") is downgraded to lower
than BBB-, in the case of D&P (or an equivalent successor rating or, if the
rating of the Securities by D&P is lower than BBB- (or an equivalent successor
rating) at the beginning of such 180-day period, the rating in effect at the
beginning of such period), or lower than Baa3, in the case of Moody's (or an
equivalent successor rating or, if the rating of the Securities by Moody's is
lower than Baa3 (or an equivalent successor rating) at the beginning of such
180-day period, the rating in effect at the beginning of such period) and, in
the event that such downgrading shall have occurred during the
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90-day period prior to such public disclosure, the rating assigned to the
Securities of such series by D&P or Moody's (or an equivalent successor rating)
as of the close of business on the date of such public disclosure remains lower
than BBB- or lower than Baa3 (or such lower rating by D&P or Moody's in effect
at the beginning of such 180-day period, as the case may be), respectively (the
occurrence of the conditions specified in both (i) and (ii) being a "Put
Event"), then each Holder of Securities of such series shall have the right, at
such Holder's option and subject to the conditions of this Section 4.02, to
require the Company to purchase all or any portion of such Holder's Securities
of such series at a purchase price equal to 100% of the principal amount
thereof, plus accrued and unpaid interest, if any, to the Purchase Date (as
hereinafter defined) (or if such Securities are Original Issue Discount
Securities, 100% of that portion of the principal amount thereof that, as
specified in the terms of the Securities of that series, would be payable if
the maturity thereof were accelerated pursuant to Section 6.02 to the Purchase
Date). The exercise by a Holder of its right to require the Company to purchase
all or a portion of such Holder's Securities pursuant to this Section 4.02
shall be irrevocable unless waived by the Company. Notwithstanding anything to
the contrary in this Section 4.02, with respect to the Securities of any
series, the Company shall not be obligated to purchase Securities of such
series or give notice to the Holders thereof with respect to more than one
Put Event.
(b) In case a Put Event shall have occurred, the Company shall in the manner
provided in Section 11.02 give notice of such Put Event to the Trustee and to
each Holder of Securities of such series within fifteen days following such
occurrence, which notice shall set forth details regarding the right of the
Holders to require the Company to purchase Securities of such series, the date
(the "Purchase Date") fixed for purchase by the Company of such Securities,
which date shall (subject to Section 11.08) be the 90th day following the date
on which such notice is mailed by the Company to the Holders of Registered
Securities (or, if Securities of the series are issuable as Bearer Securities
and such notice is published as provided in Section 11.02, then the 90th day
following the date of the first publication of such notice), and the name and
address of the Paying Agent to which such Securities (together in the case of
Bearer Securities with all coupons appertaining thereto, if any, maturing after
the Purchase Date) are to be presented and surrendered (which Paying Agent, for
purposes of this Section 4.02, shall, in the case of Registered Securities, be
the Trustee and, in the case of Bearer Securities, shall be the office or
agency maintained by the Company for such purpose in a place of payment located
outside the United States (except as otherwise provided in Section 4.01)). If
applicable, such notice shall also state that interest accrued to the Purchase
Date will be paid as specified in said notice and that interest (or, in the
case of Original Issue Discount Securities, original issue discount) on
Securities (or portions thereof) presented and surrendered for purchase will
cease to accrue on and after the Purchase Date (unless the Company defaults in
paying the purchase price and accrued interest, if any).
Any Holder intending to exercise its right to put its Securities to the
Company, shall deliver written notice of such intention to the Paying Agent,
and shall concurrently present and surrender the Securities (together, in the
case of Bearer Securities, with all coupons appertaining thereto, if any,
maturing after the Purchase Date) to be purchased to the applicable Paying
Agent in proper form for purchase by the Company, by the close of business on
the fifteenth day preceding the Purchase Date. Any Registered Security so
surrendered for purchase in part shall (if the Company, the Registrar or the
Trustee so requires) be duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company, the Registrar
and/or the Trustee duly executed by, the Holder thereof or his attorney duly
authorized in writing. Such notice by a Holder shall identify the Securities so
surrendered, their aggregate principal amount and, if less than the entire
principal amount thereof is to be purchased, the portion of such principal
amount to be purchased (in increments of the minimum authorized denomination
for Securities of such series) and the denomination or denominations (which
shall be an authorized denomination for Securities of such series) of the
Security or Securities to be issued to the Holder for the portion of the
principal amount of the surrendered Security not to be purchased, and shall
include such other information as may be specified for Securities of such
series as contemplated by Section 2.02 (including, to the extent applicable,
the name and address of the Holder and/or the person to whom payment of the
purchase price is to be made). No such notice shall be deemed to have been
delivered, and no such Securities shall be deemed to have been presented and
surrendered, until such notice and Securities are actually received by the
Paying Agent. The right of the Holders to require the Company to purchase
Securities pursuant to this Section 4.02 shall terminate as of the close of
business on the fifteenth day preceding the Purchase Date and the Company shall
not be obligated to purchase any Securities presented and surrendered
thereafter.
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(c) With respect to each Security which has been properly presented and
surrendered, together with all coupons, if any, appertaining thereto maturing
after the Purchase Date, and as to which notice has been given to the Paying
Agent of the Holder's intention to put the same (or any portion thereof) to
the Company in accordance with this Section 4.02, such Security (or portion
thereof) shall become due and payable on the Purchase Date, and on and after
the Purchase Date (unless, as to any such Security (or portion thereof), the
Company fails to make the deposit of the purchase price thereof and pay the
accrued interest, if any, thereon as provided below) interest (or, in the case
of Original Issue Discount Securities, original issue discount), if any, on
such Securities (or portions thereof) shall cease to accrue and the coupons
for such interest appertaining to any Bearer Securities so to be purchased,
except to the extent provided below, shall be void. On or before noon, New
York time, on the Purchase Date, the Company shall deposit with the applicable
Paying Agent money, in immediately available funds, sufficient to pay the
purchase price of, and (except if the Purchase Date is an Interest Payment
Date) accrued interest, if any, on, all Securities or portions thereof to be
purchased on the Purchase Date. Unless otherwise specified as contemplated by
Section 2.02, the Paying Agent shall promptly mail to the Holders of such
Securities payment in an amount equal to such purchase price and accrued
interest, if any; provided, however, that (i) no such payment with respect to
any Bearer Security shall be mailed to any address in the United States
(except as otherwise provided in Section 4.01); (ii) installments of interest
on Bearer Securities whose stated maturity is on or prior to the Purchase Date
shall be payable only at an office or agency maintained by the Company in a
place of payment located outside the United States (except as otherwise
provided in Section 4.01) and, unless otherwise specified as contemplated by
Section 2.02, only upon presentation and surrender of the coupons for such
interest, (iii) unless otherwise specified as contemplated by Section 2.02,
installments of interest on Registered Securities whose stated maturity is on
or prior to the Purchase Date shall be payable to the Holders of such
Securities, or one or more Predecessor Securities, registered as such at the
close of business on the relevant Regular Record Date or special record date,
as the case may be, according to their terms and the provisions of Section
2.13, and (iv) unless otherwise specified as contemplated by Section 2.02, if
the Purchase Date is after a record date for the payment of interest on
Registered Securities of the series and before the related interest payment
date, any accrued and unpaid interest to the Purchase Date will be payable on
the Purchase Date to the person who was the registered Holder of such Security
at the close of business on such record date.
If any Bearer Security surrendered for purchase shall not be accompanied by
all appurtenant coupons maturing after the Purchase Date, such Security may be
purchased after deducting from the purchase price therefor an amount equal to
the face amount of all such missing coupons, or the surrender of such missing
coupon or coupons may be waived by the Company and the Trustee if there be
furnished to them such security or indemnity as they may require to save each
of them and any Paying Agent harmless. If thereafter the Holder of such
Security shall surrender to the Trustee or any Paying Agent any such missing
coupon in respect of which a deduction shall have been made from the purchase
price, such Holder shall be entitled to receive the amount so deducted;
provided, however, that interest represented by coupons shall be payable only
at an office or agency located outside the United States (except as otherwise
provided in Section 4.01), and, unless otherwise specified as contemplated by
Section 2.02, only upon presentation and surrender of those coupons.
If any Registered Security is duly surrendered in accordance with this
Section 4.02 for purchase in part only, the Company shall execute, and the
Trustee shall promptly authenticate and deliver to the Holder of such
Security, without service charge, a new Registered Security or Registered
Securities of the same series, containing identical terms and provisions, of
any authorized denomination as requested by such Holder in its notice given
pursuant to Section 4.02(b) in aggregate principal amount equal to and in
exchange for the unpurchased portion of the principal amount of the Security
so surrendered, and, unless otherwise specified as contemplated by Section
2.02, if a global Security is so surrendered, the Company shall execute, and
the Trustee shall promptly authenticate and deliver to the depositary for such
global Security, without service charge, a new global Security in a
denomination equal to and in exchange for the unpurchased portion of the
principal amount of the global Security so surrendered.
The Company shall comply with applicable Federal and state securities laws
in performing its obligations under this Section 4.02.
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(d) The Company shall take all reasonable action necessary to enable D&P and
Moody's to provide ratings for the Securities.
(e) Notwithstanding anything to the contrary in this Indenture, if the
giving of the notice of a Put Event shall have been completed as provided in
this Section 4.02, or if provision satisfactory to the Trustee for the giving
of such notice shall have been made, and if the Company shall have deposited
with the applicable Paying Agent, funds sufficient to purchase the Securities
or portions thereof to be purchased on the Purchase Date at the applicable
purchase price and to pay as provided above the accrued and unpaid interest
thereon, then all obligations of the Company in respect of such Securities or
portions thereof shall cease and be discharged and the Holders of such
Securities shall thereafter be restricted exclusively to such funds for any
and all claims of whatsoever nature on their part under this Indenture or in
respect of such Securities.
Section 4.03. Designation of Restricted Subsidiaries.
With respect to the Securities of any series, the Company may designate an
Unrestricted Subsidiary as a Restricted Subsidiary or designate a Restricted
Subsidiary as an Unrestricted Subsidiary at any time, provided that (1)
immediately after giving effect to such designation, the Leverage Ratio of the
Restricted Group is not greater than 8.0:1 and the Company and the Restricted
Subsidiaries are in compliance with Sections 4.04 and 4.05, and (2) an
Officers' Certificate with respect to such designation is delivered to the
Trustee within 75 days after the end of the fiscal quarter of the Company in
which such designation is made (or, in the case of a designation made during
the last fiscal quarter of any fiscal year of the Company, within 120 days
after the end of such fiscal year), which Officers' Certificate shall state
the effective date of such designation. The Company shall make the initial
designation of Restricted Subsidiaries with respect to the Securities of any
series, and deliver the required Officers' Certificate with respect thereto to
the Trustee, on or prior to the date of initial issuance of Securities of such
series.
Section 4.04. Limitation on Liens.
(a) As long as any Securities of a series entitled to the benefit of this
covenant are outstanding, the Company will not, and will not permit any
Restricted Subsidiary to, create, incur or assume any Lien on Restricted
Property to secure the payment of Funded Debt of the Company or any Restricted
Subsidiary if immediately after the creation, incurrence or assumption of said
Lien, the aggregate outstanding principal amount of all Funded Debt of the
Company and the Restricted Subsidiaries that is secured by Liens on Restricted
Property would exceed fifteen percent (15%) of the Maximum Funded Debt Amount,
unless in any such case the Company makes effective provision whereby the
Securities (together with, if the Company shall so determine, any other Funded
Debt ranking equally with the Securities, whether then existing or thereafter
created) are secured equally and ratably with (or prior to) such Funded Debt
(but only for so long as such Funded Debt is so secured). (For the purpose of
providing such equal and ratable security the principal amount of the
Securities means that principal amount or portion thereof that could be
declared to be due and payable pursuant to Section 6.02 on the date of the
creation, incurrence or assumption of the Lien and the extent of such equal
and ratable security will be adjusted as and when said principal amount or
portion thereof changes over time pursuant to Section 6.02 and any other
provision of this Indenture or such Securities.)
(b) The provisions of Section 4.04(a) shall not apply to the creation,
incurrence or assumption of the following Liens:
(1) Any Lien which arises out of a judgment or award against the Company
or any Restricted Subsidiary with respect to which the Company or such
Restricted Subsidiary at the time shall be prosecuting an appeal or
proceeding for review (or with respect to which the period within which
such appeal or proceeding for review may be initiated shall not have
expired) and with respect to which it shall have secured a stay of
execution pending such appeal or proceedings for review or with respect to
which the
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Company or such Restricted Subsidiary shall have posted a bond and
established adequate reserves (in accordance with generally accepted
accounting principles) for the payment of such judgment or award;
(2) Any Lien upon any real or personal property or interest therein of a
Restricted Subsidiary existing at the time of acquisition thereof or
securing the payment of Funded Debt incurred by such Restricted Subsidiary
to finance some or all of the purchase price of, or cost of construction of
or improvements on, any such property or interest therein, provided that
(i) the outstanding principal amount of the Funded Debt secured by such
Lien does not at any time exceed 100% of the greater of the purchase price
for or the fair value of such real or personal property or interest
therein, (ii) such Lien does not encumber or constitute a charge against
any other Restricted Property theretofore owned by the Restricted Group
(except that in the case of construction or improvement, the Lien may
extend to unimproved real property on which the property so constructed or
the improvement is located), and (iii) the Funded Debt secured by such Lien
would be permitted to be incurred under Section 4.05; and
(3) Any Lien representing the extension, renewal or replacement (or
successive extensions, renewals or replacements) of Liens referred to in
clause (2) above, provided that the principal of the Funded Debt secured
thereby does not exceed the principal of the Funded Debt secured thereby
immediately prior to such extension, renewal or replacement, plus any
accrued and unpaid interest or capitalized interest payable thereon, and
that such extension, renewal or replacement shall be limited to all or a
part of the property (or interest therein) subject to the Lien so extended,
renewed or replaced (plus improvements and construction on such property).
The outstanding principal amount of Funded Debt secured by a Lien permitted
by clause (2) or (3) of this Section 4.04(b) or, if less, the fair value of
the property or interest therein secured thereby, shall be included in the
calculation pursuant to Section 4.04(a) of the aggregate outstanding principal
amount of Funded Debt secured by Liens on Restricted Property for purposes of
determining whether a Lien (other than one referred to in this Section
4.04(b)) may be incurred in compliance with Section 4.04(a).
Section 4.05. Limitation on Restricted Subsidiary Funded Debt.
As long as any Securities of a series entitled to the benefit of this
covenant are outstanding the Company will not permit any Restricted Subsidiary
to incur or assume any Funded Debt if immediately after the incurrence or
assumption of such Funded Debt, the aggregate outstanding principal amount of
all Funded Debt of the Restricted Subsidiaries would exceed fifteen percent
(15%) of the Maximum Funded Debt Amount. Notwithstanding the foregoing, any
Restricted Subsidiary may incur Funded Debt to extend, renew or replace Funded
Debt of such Restricted Subsidiary, provided that the principal of the Funded
Debt so incurred does not exceed the principal of the Funded Debt extended,
renewed or replaced thereby immediately prior to such extension, renewal or
replacement, plus any accrued and unpaid interest or capitalized interest
payable thereon.
Section 4.06. SEC Reports.
The Company shall file with the Trustee within 15 days after it files them
with the SEC copies of the annual reports and of the information, documents
and other reports (or copies of such portions of any of the foregoing as the
SEC may by rules and regulations prescribe) which the Company is required to
file with the SEC pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934. The Company also shall comply with the other provisions of TIA
(S) 314(a).
Section 4.07. Compliance Certificate.
The Company shall, within 120 days after the end of each fiscal year of the
Company, commencing with the first fiscal year following the issuance of
Securities of any series under this Indenture, file with the Trustee a
certificate of the principal executive officer, principal financial officer or
principal accounting officer of the
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Company covering the period from the date of issuance of such Securities to
the end of the fiscal year in which such Securities were issued, in the case
of the first such certificate, and covering the preceding fiscal year in the
case of each subsequent certificate, and stating whether or not, to the
knowledge of the signer, the Company has complied with all conditions and
covenants on its part contained in this Indenture, and, if the signer has
obtained knowledge of any default by the Company in the performance,
observance or fulfillment of any such condition or covenant, specifying each
such default and the nature thereof. For the purpose of this Section 4.07,
compliance shall be determined without regard to any grace period or
requirement of notice provided pursuant to the terms of this Indenture. The
certificate need not comply with Section 11.05.
The Company shall deliver to the Trustee within 120 days after the end of
each fiscal year of the Company a written statement signed by the Company's
independent auditors stating (1) that their audit examination has included a
review of the terms of this Indenture and the Securities as they relate to
accounting matters, and (2) whether, in connection with their audit
examination, any Event of Default has come to their attention and if such an
Event of Default has come to their attention, specifying the nature and period
of existence thereof.
Section 4.08. Corporate Existence.
Subject to the provisions of Section 5.01 hereof, the Company will do or
cause to be done all things necessary to preserve and keep in full force and
effect its corporate existence.
Section 4.09. Waiver of Certain Covenants.
The Company may omit in any particular instance to comply with any term,
provision or condition set forth in Sections 4.02 to 4.05, inclusive, with
respect to the Securities of any series if before the time for such compliance
the Holders of at least a majority in principal amount of the outstanding
Securities of such series shall either waive such compliance in such instance
or generally waive compliance with such term, provision or condition, but no
such waiver shall extend to or affect such term, provision or condition except
to the extent so expressly waived, and, until such waiver shall become
effective, the obligations of the Company and the duties of the Trustee in
respect of any such term, provision or condition shall remain in full force
and effect.
Section 4.10. No Lien Created.
This Indenture and the Securities do not create a Lien, charge or
encumbrance on any property of the Company or any Subsidiary.
Section 4.11. Calculation of Original Issue Discount.
The Company shall file with the Trustee promptly at the end of each calendar
year a written notice specifying the amount of original issue discount
(including daily rates and accrual periods) accrued on outstanding Securities
as of the end of such year.
ARTICLE FIVE
Successor Corporation
Section 5.01. When Company May Merge, etc.
The Company shall not consolidate with or merge into, or transfer its
properties and assets substantially as an entirety to, another corporation
unless (1) the successor corporation, which shall be a corporation organized
and existing under the laws of the United States or a State thereof, assumes
by supplemental indenture all the obligations of the Company under the
Securities and any coupons appertaining thereto and this Indenture; and (2)
immediately after giving effect to such transaction, no Default or Event of
Default shall have occurred and be continuing. Thereafter, unless otherwise
specified as contemplated by Section 2.02 for the Securi ties of any series
and any related coupons, all such obligations of the predecessor corporation
shall terminate.
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ARTICLE SIX
Defaults and Remedies
Section 6.01. Events of Default.
An "Event of Default" with respect to Securities of any series means each
one of the events specified below in this Section 6.01, unless it is either
inapplicable to a particular series or is specifically deleted or modified as
contemplated by Section 2.02 for the Securities of such series, and any other
events as may be specified as contemplated by Section 2.02 for the Securities
of such series:
(1) the Company defaults in the payment of any interest on any Security
of that series when the same becomes due and payable and the default
continues for a period of 30 days;
(2) the Company defaults in the payment of the principal of any Security
of that series when the same becomes due and payable at maturity, upon
redemption (including default in the making of any mandatory sinking fund
payment), upon purchase by the Company at the option of the Holder pursuant
to the terms of such Security or otherwise;
(3) the Company fails to comply with any of its other agreements in
Securities of that series or this Indenture (other than an agreement which
has expressly been included in this Indenture solely for the benefit of
Securities of any series other than that series or is expressly made
inapplicable to the Securities of such series as contemplated by Section
2.02) and the default continues for the period and after the notice
specified below;
(4) the happening of an event of default as defined in any mortgage,
indenture or instrument under which there may be issued or by which there
may be secured or evidenced any Debt of the Company (including an Event of
Default under this Indenture with respect to Securities of any series other
than that series), whether now existing or hereafter created, which event
of default shall have resulted in Debt of the Company becoming or being
declared due and payable prior to the date on which it would otherwise have
become due and payable if the aggregate principal amount (or, if
applicable, with an issue price plus accrued original issue discount) of
such Debt is in excess of five percent (5%) of the aggregate principal
amount of the Company's Funded Debt then outstanding, unless, within the
period and after the notice specified below, such acceleration has been
rescinded or annulled, such Debt has been paid or the Company shall have
contested such acceleration in good faith and by appropriate proceedings
and have obtained and thereafter maintained a stay of all consequences
thereof that would have a material adverse effect on the Company; provided,
however, that if after the expiration of such period, such event of default
shall be remedied or cured by the Company or be waived by the holders of
such Debt in any manner authorized by such mortgage, indenture or
instrument or shall otherwise cease to exist, then the Event of Default
hereunder by reason thereof shall, without further action by the Company,
the Trustee or any Holder, be deemed cured and not continuing;
(5) the Company pursuant to or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case or consents to the commencement of a
case against it,
(B) consents to the entry of an order for relief against it in an
involuntary case,
(C) consents to the appointment of a Custodian of it or for all or
substantially all of its property, or
(D) makes a general assignment for the benefit of its creditors;
(6) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(A) is for relief against the Company in an involuntary case or
adjudicates the Company insolvent or bankrupt,
(B) appoints a Custodian of the Company or for all or substantially
all of its property, or
(C) orders the winding up or liquidation of the Company, and the
order or decree remains unstayed and in effect for 90 days; or
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(7) any other Event of Default provided with respect to Securities of
that series occurs.
The term "Bankruptcy Law" means Title 11, U.S. Code or any similar Federal
or State law for the relief of debtors. The term "Custodian" means any
receiver, trustee, assignee, liquidator or similar official under any
Bankruptcy Law.
A Default under clause (3) or clause (4) is not an Event of Default until
the Trustee notifies the Company or the Holders of at least 25% in aggregate
principal amount of the outstanding Securities of that series notify the
Company and the Trustee of the Default and the Company does not cure the
Default within 30 days after receipt of the notice. The notice must specify
the Default, demand that it be remedied and state that the notice is a "Notice
of Default."
Section 6.02. Acceleration.
If an Event of Default (other than an Event of Default specified in Section
6.01(5) or (6)) occurs and is continuing with respect to Securities of any
series at the time outstanding, the Trustee by notice to the Company, or the
Holders of at least 25% in aggregate principal amount of the outstanding
Securities of that series by notice to the Company and the Trustee, may
declare to be due and payable immediately (1) the principal amount (or, if
Securities of that series are Original Issue Discount Securities, such portion
of the principal amount as may be specified in the terms of Securities of that
series) of all of the Securities of that series then outstanding and (2)
interest, if any, accrued to the date of acceleration. Upon such declaration,
such principal amount (or specified amount) and interest, if any, shall be due
and payable immediately. If an Event of Default specified in Section 6.01(5)
or (6) occurs and is continuing, (1) the principal amount (or, if the
Securities of that series are Original Issue Discount Securities, such portion
of the principal amount as may be specified in the terms of the Securities of
that series) of all of the Securities of that series then outstanding and (2)
interest, if any, accrued to the date of such acceleration, shall become and
be immediately due and payable without any declaration or other act on the
part of the Trustee or Securityholders. The Holders of a majority in aggregate
principal amount of the outstanding Securities of the series with respect to
which an acceleration applies by notice to the Trustee may rescind an
acceleration and its consequences with respect to such series if all existing
Events of Default (other than the non-payment of the principal of and accrued
interest, if any, on Securities that have become due solely by such
acceleration) with respect to Securities of that series have been cured or
waived and if the rescission would not conflict with any judgment or decree.
In the event of a declaration of acceleration under this Indenture with
respect to Securities of any series because an Event of Default set forth in
Section 6.01(4) has occurred and is continuing, such declaration of
acceleration shall be automatically annulled if (a) as a result of the contest
by the Company in appropriate proceedings of the acceleration of the Debt
which is the subject of such Event of Default the acceleration of such
indebtedness is declared void ab initio, or (b) within 90 days of such
declaration of acceleration under this Indenture the declaration of
acceleration of the Debt which is the subject of such Event of Default has
been rescinded or annulled in any manner authorized by the mortgage, indenture
or instrument evidencing or creating such Debt and, in the case of this clause
(b), the annulment of the declaration of acceleration under this Indenture
would not conflict with any judgment or decree, and, in either case, all other
existing Events of Default (other than the non-payment of the principal of and
accrued interest, if any, on Securities that have become due solely by such
acceleration) with respect to Securities of that series have been cured or
waived. No such rescission or annulment shall affect any subsequent default or
impair any right consequent thereon.
Section 6.03. Other Remedies.
If an Event of Default with respect to Securities of any series occurs and
is continuing, the Trustee may pursue any available remedy by proceeding at
law or in equity to collect the payment of the whole amount which then shall
have become due and remain unpaid for principal or interest, if any, on the
Securities of that series and any related coupons or to enforce the
performance of any provision of the Securities of that series or this
Indenture.
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The Trustee may maintain a proceeding even if it does not possess any of the
Securities of that series or any related coupons or does not produce any of
them in the proceeding. A delay or omission by the Trustee or any Holder of
Securities or related coupons, if any, in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.
Section 6.04. Waiver of Existing Defaults.
Subject to Section 9.02, the Holders of a majority in aggregate principal
amount of the outstanding Securities of any series by notice to the Trustee
may waive on behalf of the Holders of all the Securities of such series and
any related coupons an existing Default or Event of Default and its
consequences. When a Default or Event of Default is waived, it is cured and
stops continuing.
Section 6.05. Control by Majority.
The Holders of a majority in aggregate principal amount of the outstanding
Securities of any series may direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee or exercising any trust
or power conferred on it, with respect to the Securities of such series. The
Trustee, however, may refuse to follow any direction that conflicts with law
or this Indenture, that is unduly prejudicial to the rights of another
Securityholder or that would involve the Trustee in personal liability.
Section 6.06. Limitation on Suits.
No Holder of any Security of any series or any related coupons shall have
the right to pursue any remedy with respect to this Indenture or the
Securities unless:
(1) the Holder gives to the Trustee written notice of a continuing Event
of Default with respect to the Securities of that series;
(2) the Holders of at least 25% in aggregate principal amount of the
outstanding Securities of that series make a written request to the Trustee
to pursue the remedy;
(3) such Holder or Holders offer and provide to the Trustee indemnity
satisfactory to the Trustee against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer of indemnity; and
(5) no direction inconsistent with such written request has been given to
the Trustee during such 60-day period by the Holders of a majority in
aggregate principal amount of the outstanding Securities of such series.
A Securityholder of any series may not use this Indenture to prejudice the
rights of another Securityholder of such series or to obtain a preference or
priority over another Securityholder of such series, except in the manner
herein provided and for the equal and ratable benefit of all Securityholders
of such series.
Section 6.07. Rights of Holders to Receive Payment and to Convert.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Security or a coupon to receive payment of principal of and
(subject to Sections 2.08 and 2.13) interest, if any, on the Security or
payment on such coupon, on or after the respective due dates with respect to
such payments expressed in such Security or coupon, and, if applicable, to
convert such Security on the terms and subject to the conditions applicable to
Securities of such series, or to bring suit for the enforcement of any such
payment on or after such respective dates or of such right to convert, if any,
shall not be impaired or affected without the consent of the Holder.
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Section 6.08. Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(1) or (2) occurs and is
continuing with respect to the Securities of any series, the Trustee may
recover judgment in its own name and as trustee of an express trust against
the Company for the whole amount which then shall have become due and remain
unpaid for principal and interest, if any, on the Securities of such series
and any related coupons.
Section 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or documents as
may be necessary or advisable in order to have the claims of the Trustee and
the Securityholders (including the Holders of any coupons) allowed in any
judicial proceedings relative to the Company, its creditors or its property
and to collect and receive money, property or securities payable or
deliverable on any such claims and to distribute the same.
Section 6.10. Priorities.
Any money collected by the Trustee pursuant to this Article shall be applied
in the following order, at the date or dates fixed by the Trustee and, in the
case of the distribution of such money on account of principal or interest,
upon presentation of the Securities or coupons, or both, as the case may be,
and the notation thereon of the payment if only partially paid and upon
surrender thereof if fully paid:
First: to the Trustee for amounts due under Section 7.07;
Second: to the payment of amounts due and unpaid for principal and
interest, if any, on the Securities and coupons in respect of which such
money has been collected, ratably, without preference or priority of any
kind, according to the amounts which then shall have become due and payable
on such Securities and coupons for principal and interest, respectively;
and
Third: to the Company.
Section 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this Indenture
or in any suit against the Trustee for any action taken or omitted by it as
Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in the suit, having
due regard to the merits and good faith of the claims or defenses made by the
party litigant. This Section does not apply to a suit by the Trustee, a suit
by a Holder pursuant to Section 6.07 or a suit by Holders of more than 10% in
aggregate principal amount of the outstanding Securities of any series.
ARTICLE SEVEN
Trustee
All the provisions of this Article Seven apply to the Trustee acting in all
its appointed capacities pursuant to this Indenture unless any provision
specifically applies to the Trustee only in its capacity as Trustee.
Section 7.01. Duties of Trustee.
(a) If an Event of Default with respect to Securities of any series has
occurred and is continuing, the Trustee shall with respect to such series
exercise such of the rights and powers vested in it by this Indenture with
respect to such series and use the same degree of care and skill in their
exercise as a prudent man would exercise or use under the circumstances in the
conduct of his own affairs.
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(b) With respect to Securities of any series, except during the continuance
of an Event of Default with respect to Securities of such series:
(1) The Trustee need perform only those duties that are specifically set
forth in this Indenture or the TIA and no others.
(2) In the absence of bad faith on its part, the Trustee may conclusively
rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon certificates or opinions furnished to the Trustee
and conforming to the requirements of this Indenture. The Trustee, however,
in the case of any such certificates or opinions which by any provision
hereof are specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine whether or
not they conform to the requirements of this Indenture (but need not
confirm or investigate the accuracy of mathematical calculations or other
facts stated therein).
(c) The Trustee may not be relieved from liability for its own negligent
action, its own negligent failure to act or its own willful misconduct, except
that:
(1) This paragraph does not limit the effect of paragraph (b) of this
Section.
(2) The Trustee shall not be liable for any error of judgment made in
good faith by a Trust Officer, unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts.
(3) The Trustee shall not be liable with respect to any action it takes
or omits to take in good faith in accordance with a direction received by
it pursuant to Section 6.05.
(d) Every provision of this Indenture that in any way relates to the Trustee
is subject to paragraphs (a), (b) and (c) of this Section.
(e) No provision of this Indenture shall require the Trustee to expend or
risk its own funds or incur any liability. The Trustee may refuse to perform
any duty or exercise any right or power unless it receives indemnity
satisfactory to it against any loss, liability or expense.
(f) The Trustee shall not be liable for interest on any money received by it
except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
Section 7.02. Rights of Trustee.
(a) The Trustee may rely on any document believed by it to be genuine and to
have been signed or presented by the proper person. The Trustee need not
investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may consult with
counsel or require an Officers' Certificate, an Opinion of Counsel and/or an
accountant's certificate. The Trustee shall not be liable for any action it
takes or omits to take in good faith in reliance on the Certificate, Opinion,
or accountant's certificate.
(c) The Trustee may act through agents and counsel and shall not be
responsible for the misconduct or negligence of any agent or counsel appointed
with due care.
(d) The Trustee shall not be liable for any action it takes or omits to take
in good faith which it believes to be authorized or within its rights or
powers.
Section 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the owner or
pledgee of Securities and coupons and may otherwise deal with the Company or
its Affiliates with the same rights it would have if it were not Trustee. Any
Agent may do the same with like rights. The Trustee, however, must comply with
Sections 7.10 and 7.11.
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Section 7.04. Trustee's and Authenticating Agent's Disclaimer.
Neither the Trustee nor any Authenticating Agent makes any representation as
to the validity or adequacy of this Indenture or the Securities or the coupons,
if any, appertaining thereto; neither shall be accountable for the Company's
use of the proceeds from the Securities; and neither shall be responsible for
any statement in the Indenture or the Securities or any coupons other than its
certificate of authentication.
Section 7.05. Notice of Defaults.
If a Default occurs and is continuing with respect to Securities of any
series and if it is known to a Trust Officer of the Trustee, the Trustee shall
transmit by mail to the Holders of Securities of such series in the manner and
to the extent provided in TIA (S) 313(c) notice of the Default within 90 days
after it occurs or as soon as reasonably practicable thereafter. Except in the
case of a default in payment of principal of or interest on any Security of
such series or any related coupons (including default in the making of any
mandatory sinking fund or mandatory repurchase payment), the Trustee may
withhold the notice if and so long as a committee of its Trust Officers in good
faith determines that withholding the notice is in the interests of
Securityholders of such series.
Section 7.06. Reports by Trustee to Holders.
Within 60 days after each May 15 beginning with the May 15 following the date
on which Securities are originally issued under this Indenture, the Trustee
shall transmit by mail to the Holders of Securities, in the manner and to the
extent provided in TIA (S) 313(c), a brief report dated as of such May 15 that
complies with TIA (S) 313(a). The Trustee also shall comply with TIA (S)
313(b).
A copy of each report at the time of its mailing to Securityholders shall be
filed by the Company with the SEC and each stock exchange on which the
Securities are listed.
The Company will promptly notify the Trustee if and when the Securities are
listed on any stock exchange.
Section 7.07. Compensation and Indemnity.
The Company shall pay to the Trustee such compensation as shall have been
agreed upon in writing. The Trustee's compensation shall not be limited by any
law on compensation of a trustee of an express trust. The Company shall
reimburse the Trustee upon request for all reasonable out- of-pocket expenses
incurred by it. Such expenses shall include the reasonable compensation and
expenses of the Trustee's agents and counsel.
The Company shall indemnify the Trustee against any loss or liability
incurred by it arising out of or in connection with the acceptance or
administration of this trust and its duties hereunder. The Trustee shall notify
the Company promptly of any claim asserted against the Trustee for which it may
seek indemnity. Failure of the Trustee to so notify the Company shall not
relieve the Company of its obligations hereunder. The Company shall have the
right to elect to defend the claim and the Trustee shall cooperate in the
defense. The Trustee may have separate counsel and the Company shall pay the
reasonable fees and expenses of such counsel. The Company need not pay for any
settlement made without its written consent. The Company need not reimburse any
expense or indemnify against any loss or liability incurred by the Trustee
through the Trustee's negligence or bad faith.
To secure the Company's payment obligations in this Section, the Trustee
shall have a lien prior to the Securities on all money or property held or
collected by the Trustee, except that held in trust to pay principal of or
interest on particular Securities.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(5) or (6) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
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Section 7.08. Replacement of Trustee.
The Trustee may resign at any time with respect to the Securities of one or
more series by so notifying the Company. The Holders of a majority in
aggregate principal amount of the outstanding Securities of any series may
remove the Trustee with respect to the Securities of such series by so
notifying the removed Trustee and may appoint a successor Trustee with the
Company's consent. The Company shall remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a receiver or other public officer takes charge of the Trustee or its
property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed, or if a vacancy exists in the office
of Trustee for any reason, with respect to the Securities of one or more
series, the Company shall promptly appoint a successor Trustee or Trustees (it
being understood that any such successor Trustee may be appointed with respect
to the Securities of one or more or all of such series and that at any time
there shall be only one Trustee with respect to the Securities of any
particular series).
A successor Trustee shall deliver a written acceptance of its appointment to
the retiring Trustee and to the Company. Immediately after that, the retiring
Trustee shall transfer all property held by it as Trustee to the successor
Trustee (subject to the lien, if any, provided for in Section 7.07), the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. A successor Trustee shall give notice in the manner
provided in Section 11.02 of its succession to each Securityholder.
If a successor Trustee with respect to the Securities of any series does not
take office within 60 days after the retiring Trustee resigns or is removed,
the retiring Trustee, the Company or the Holders of a majority in aggregate
principal amount of the outstanding Securities of such series may petition any
court of competent jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder may
petition any court of competent jurisdiction for the removal of the Trustee
with respect to all Securities and the appointment of a successor Trustee.
Section 7.09. Successor Trustee by Merger, etc.
If the Trustee consolidates with, merges or converts into, or transfers all
or substantially all of its corporate trust assets to, another corporation or
national banking association, the successor corporation or national banking
association without any further act shall be the successor Trustee.
Section 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the requirements of
TIA (S) 310(a). The Trustee shall always have a combined capital and surplus
of at least $50,000,000 as set forth in its most recent published annual
report of condition. With respect to the Securities of each series, the
Trustee shall comply with TIA (S) 310(b). In determining whether the Trustee
has a conflicting interest as defined in TIA (S) 310(b) with respect to the
Securities of any series, there shall be excluded this Indenture with respect
to Securities of any particular series of Securities other than that series.
Nothing herein shall prevent the Trustee from filing with the SEC the
application referred to in the second to last paragraph of TIA (S) 310(b).
Section 7.11. Preferential Collection of Claims Against Company.
The Trustee shall comply with TIA (S) 311(a), excluding any creditor
relationship listed in TIA (S) 311(b). A Trustee who has resigned or been
removed shall be subject to TIA (S) 311(a) to the extent indicated.
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ARTICLE EIGHT
Discharge of Indenture
Section 8.01. Termination of Company's Obligations.
The Company may terminate all of its obligations under the Securities of any
series and all coupons, if any, appertaining thereto, and this Indenture with
respect to the Securities of such series if either (1) all Securities of such
series and all coupons, if any, appertaining thereto, previously authenticated
and delivered (other than (i) destroyed, lost or wrongfully-taken Securities
or coupons which have been replaced or paid as provided in Section 2.09, (ii)
Securities or coupons for whose payment money (or, if permitted by the terms
of such Securities, securities) has theretofore been held in trust and
thereafter repaid to the Company, as provided in Section 8.03, (iii) coupons
appertaining to Bearer Securities surrendered for exchange for Registered
Securities and maturing after such exchange whose surrender is not required or
has been waived as provided in Section 2.08, (iv) coupons appertaining to
Bearer Securities called for redemption and maturing after the relevant
redemption date, whose surrender has been waived as provided in Section 3.09,
and (v) coupons appertaining to Bearer Securities surrendered for purchase and
maturing after the Purchase Date, whose surrender has been waived as provided
in Section 4.02(c)) have been delivered to the Trustee for cancellation; or
(2) the Company irrevocably deposits in trust with the Trustee money or
Government Obligations sufficient to pay the principal of and interest, if
any, on all Securities of such series and all coupons, if any, appertaining
thereto previously authenticated and delivered, and not theretofore cancelled
or delivered to the Trustee for cancellation (other than any such Security or
coupon referenced in subclauses (i), (ii), (iii), (iv) or (v) of clause (1)
above), to maturity or redemption, as the case may be.
The Company's obligations in Sections 2.05, 2.06, 2.07, 2.08, 2.09, 4.01,
7.07, 7.08, 8.03 and Article Ten of this Indenture, however, shall survive
until the Securities of such series are no longer outstanding. Thereafter the
Company's obligations in Sections 7.07 and 8.03 shall survive. Notwithstanding
the satisfaction and discharge of this Indenture with respect to the
Securities of any series, if money or Government Obligations shall have been
deposited with the Trustee pursuant to clause (2) of this Section, the
obligations of the Trustee under Section 8.02 and the second sentence of
Section 8.03 shall survive.
After a deposit and if all other conditions thereto are met, the Trustee for
the Securities of such series and the coupons, if any, appertaining thereto,
shall be required to execute an instrument acknowledging satisfaction and
discharge of this Indenture with respect to such Securities, except for those
surviving obligations specified above; provided, however, that the Trustee
shall not be required to execute such instrument until the expiration of
ninety days after the date of a deposit.
In order to have money available on a payment date to pay the principal of
or interest, if any, on the Securities, the Government Obligations shall be
payable as to principal or interest on or before such payment date in such
amounts as will provide the necessary money. U.S. Government Obligations shall
not be callable at the issuer's option.
Section 8.02. Application of Trust Fund.
The Trustee shall hold in trust money and Government Obligations deposited
with it pursuant to Section 8.01. It shall apply the deposited money and the
money from the Government Obligations through the Paying Agent and in
accordance with the provisions of the Securities, the coupons and this
Indenture to the payment of principal of and interest, if any, on the
Securities and related coupons, if any, for the payment of which such money or
Government Obligations has been deposited with the Trustee.
The Company shall pay, and indemnify the Trustee against, any tax, fee or
other charge imposed on or assessed against the Government Obligations
deposited pursuant to Section 8.01 or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is
for the account of the Holders of outstanding Securities.
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Section 8.03. Repayment to Company.
The Trustee and the Paying Agent shall promptly pay to the Company upon
written request any excess money or securities held by them at any time. The
Trustee and the Paying Agent shall pay to the Company upon written request any
money or securities held by them for the payment of principal or interest, if
any, that remains unclaimed for two years; provided, however, that the Trustee
and the Paying Agent, before being required to make any such payment may at the
expense of the Company cause to be published once, in an Authorized Newspaper
in each place of payment, notice that such money remains unclaimed and that,
after a date specified therein, which date shall not be less than 30 days from
such date of such publication, any unclaimed balance of such money then
remaining will be paid to the Company. After that, Holders entitled to the
money or securities must look to the Company for payment unless an applicable
abandoned property law designates another person.
ARTICLE NINE
Amendments, Supplements and Waivers
Section 9.01. Without Consent of Holders.
The Company and the Trustee may amend or supplement this Indenture or the
Securities of any series without notice to or consent of any Holder of
Securities or coupons or the Holder of any coupons:
(1) to cure any ambiguity, defect or inconsistency;
(2) to comply with Sections 5.01 and 10.16;
(3) to secure the Securities pursuant to the requirements of Section
4.04, including to provide for the receipt and holding of any security to
which the Holders are entitled under Section 4.04, and to release such
security and the Lien of the Holders in accordance with the provisions of
Section 4.04;
(4) to establish the form or terms of Securities of any series and any
related coupons as permitted by Sections 2.01 and 2.02;
(5) to add to the covenants of the Company for the benefit of the Holders
of all or any series of Securities (and if such covenants are to be for the
benefit of less than all series of Securities, stating that such covenants
are expressly being included solely for the benefit of such series) or to
surrender any right or power herein conferred upon the Company;
(6) to add any additional Events of Default (and if such Events of
Default are to be applicable to less than all series of Securities, stating
that such Events of Default are expressly being included solely to be
applicable to such series);
(7) to change or eliminate any of the provisions of this Indenture,
provided that, except as otherwise contemplated by Section 2.02(20), any
such change or elimination shall become effective only when there is no
Security outstanding of any series created prior thereto which is entitled
to the benefit of such provision;
(8) to add to or change any of the provisions of this Indenture to
provide that Bearer Securities may be registrable as to principal, to
change or eliminate any restrictions on the payment of principal of or
interest on Bearer Securities, to permit Bearer Securities to be issued in
exchange for Registered Securities, or to permit Bearer Securities to be
issued in exchange for Bearer Securities of other authorized denominations
or to facilitate or permit the issuance of Securities in uncertificated
form (so long as any "registration-required obligation" within the meaning
of Section 163(f)(2) of the Internal Revenue Code of 1986, as amended (the
"Code") is in registered form for purposes of the Code) provided, that any
such action shall not adversely affect the interests of Holders of
Securities of any series or any related coupons in any material respect;
(9) to make any change that, in the opinion of the Board of Directors,
does not materially adversely affect the rights of any Securityholder or
the Holder of any coupon; or
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(10) to comply with any requirement of the SEC in connection with the
qualification of this Indenture under the TIA.
Section 9.02. With Consent of Holders.
The Company and the Trustee may amend or supplement this Indenture or the
Securities of any series without notice to any Holder of Securities or coupons
but with the consent of the Holders of a majority in aggregate principal
amount of the outstanding Securities of each series affected by such amendment
or supplement, by Act of said Holders delivered to the Trustee. The Holders of
a majority in aggregate principal amount of the outstanding Securities of any
series, by Act of said Holders delivered to the Trustee, may on behalf of the
Holders of all Securities of such series and any related coupons waive
compliance by the Company with any provision of this Indenture or of
Securities of such series without any notice to any Holder of Securities or
coupons. Without the consent of the Holder of each outstanding Security
affected thereby, however, an amendment, supplement or waiver, including a
waiver pursuant to Section 6.04, may not:
(1) reduce the amount of Securities of any series whose Holders must
consent to an amendment, supplement or waiver;
(2) reduce the rate of or extend the time for payment of interest on any
Security (or, in the case of an Original Issue Discount Security, reduce
the rate of accrual of original issue discount);
(3) reduce the principal of (or any premium payable upon the redemption
of) or extend the fixed maturity of any Security (or, in the case of an
Original Issue Discount Security, reduce the portion of the principal
amount that would be due and payable upon acceleration of the maturity
thereof pursuant to Section 6.02);
(4) change the amount or time of any payment required by any sinking fund
provisions of the Securities of any series;
(5) make any change that materially adversely affects the right of a
Holder to require the Company to purchase a Security in accordance with the
terms thereof and this Indenture;
(6) waive a default in the payment of principal of or interest, if any,
on any Security;
(7) make any Security payable in money or securities other than that
stated in the Security;
(8) make any change that materially adversely affects the right to
convert any Security or that increases the conversion price or reduces the
conversion rate of any Security; or
(9) change any obligation of the Company to maintain an office or agency
in the places and for the purposes specified in Section 4.01.
It shall not be necessary for the Act of the Holders under this Section to
approve the particular form of any proposed supplement or amendment, but it
shall be sufficient if such Act approves the substance thereof.
An amendment to or supplement of this Indenture which changes or eliminates
any covenant or other provision of this Indenture which has expressly been
included solely for the benefit of one or more particular series of
Securities, or which modifies the rights of the Holders of Securities of such
series with respect to such covenant or other provision, shall be deemed not
to affect the rights under this Indenture of the Holders of Securities of any
other series.
Section 9.03. Compliance with Trust Indenture Act.
Every amendment to or supplement of this Indenture or the Securities shall
comply with the TIA as then in effect.
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Section 9.04. Effect of Amendments and Supplements.
Upon the execution of any amendment or supplement authorized pursuant to this
Article, this Indenture shall be modified in accordance therewith, and such
amendment or supplement shall form a part of this Indenture for all purposes;
and every Holder of Securities theretofore or thereafter authenticated and
delivered hereunder and of any coupon appertaining thereto shall be bound
thereby.
Section 9.05. Notation on or Exchange of Securities.
If an amendment, supplement or waiver changes the terms of a Security, the
Trustee may require the Holder of the Security to deliver it to the Trustee.
The Trustee may place an appropriate notation on the Security about the changed
terms and return it to the Holder. Alternatively, if the Company or the Trustee
so determines, the Company in exchange for the Security shall issue and the
Trustee shall authenticate a new Security that reflects the changed terms.
Section 9.06. Trustee to Sign Amendments, etc.
The Trustee shall sign any amendment, supplement or waiver authorized
pursuant to this Article if the amendment, supplement or waiver does not
adversely affect the rights, duties, immunities or liabilities of the Trustee.
If it does, the Trustee may but need not sign it. The Company may not sign an
amendment or supplement until the Board of Directors approves it.
In executing, or accepting the additional trusts created by, any supplemental
indenture permitted by this Article or the modification thereby of the trusts
created by this Indenture, the Trustee shall be entitled to receive, and shall
be fully protected in relying upon, an Opinion of Counsel stating that the
execution of such supplemental indenture is authorized or permitted by this
Indenture.
ARTICLE TEN
Conversion
Section 10.01. Applicability of Article.
Securities of any series which are convertible into Parent Stock at the
option of the Holder shall be convertible in accordance with their terms and
(except as otherwise specified as contemplated by Section 2.02 for Securities
of any series) in accordance with this Article. Each reference in this Article
to "a Security" or "the Securities" refers to the Securities of the particular
series that is convertible into Parent Stock. If more than one series of
Securities with conversion privileges are outstanding at any time, the
provisions of this Article shall be applied separately to each such series.
Section 10.02. Conversion Privilege.
A Holder of a Security of any authorized denomination of any series may
convert it into Parent Stock, at any time during the period specified on the
Securities of that series, at the conversion price or conversion rate in effect
on the conversion date, except that, with respect to any Security (or portion
thereof) called for redemption, such right shall (except as otherwise provided
in Section 3.08) terminate at the close of business on the fifteenth day prior
to the date fixed for redemption of such Security (or portion thereof) (or such
other day as may be specified as contemplated by Section 2.02 for Securities of
such series), unless the Company shall default in payment of the amount due
upon redemption thereof.
The initial conversion price or conversion rate in respect of a series of
Securities shall be as specified on the Securities of that series. The
conversion price or conversion rate will be subject to adjustment on the terms
set forth in Sections 10.07 through 10.13 or such other or different terms, if
any, as may be specified as contemplated by Section 2.02 for Securities of such
series.
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A Holder may convert any Security in full and may convert a portion of a
Security if the portion to be converted and the remaining portion of such
Security are in denominations issuable for that series of Securities.
Provisions of this Indenture that apply to conversion of all of a Security also
apply to conversion of a portion of it.
Section 10.03. Conversion Procedure.
To convert a Security of any series, a Holder must satisfy the requirements
for conversion contained on the Securities of that series. The date on which
the Holder satisfies all those requirements is the conversion date. As soon as
practicable after the conversion date, the Company shall deliver to the Holder
through the Conversion Agent a certificate for the number of shares of Parent
Stock deliverable upon the conversion and cash or its check in lieu of any
fractional share. The person in whose name the certificate is registered
becomes a stockholder of record on the conversion date and the rights of the
Holder of the Securities so converted as a Holder thereof cease as of such
date.
If the Holder converts more than one Security of any series at the same time,
the number of full shares issuable upon the conversion shall be based on the
total principal amount of the Securities of such series so converted.
Upon surrender of a Security of any series that is converted in part, the
Trustee shall authenticate for the Holder a new Security of that series equal
in principal amount to the unconverted portion of the Security surrendered.
If the last day on which a Security may be converted is a Legal Holiday in a
place where a Conversion Agent is located, the Security may be surrendered to
that Conversion Agent on the next succeeding day that is not a Legal Holiday.
The Company will not be required to deliver certificates for shares of Parent
Stock upon conversion while the Parent's stock transfer books are closed for a
meeting of stockholders or for the payment of dividends or for any other
purpose, but certificates for shares of Parent Stock shall be delivered as soon
as the stock transfer books shall again be opened.
Registered Securities of any series surrendered for conversion during the
period from the close of business on any Regular Record Date next preceding any
Interest Payment Date for such series to the opening of business on such
Interest Payment Date shall (except in the case of Securities or portions
thereof which have been called for redemption on a redemption date within such
period) be accompanied by payment in funds acceptable to the Company of an
amount equal to the interest payable on such Interest Payment Date on the
principal amount of Registered Securities being surrendered for conversion;
provided, that no such payment need be made if there shall exist, at the time
of conversion, a default in the payment of interest on the Securities of such
series. The funds so delivered to the Conversion Agent shall be paid to the
Company on or after such Interest Payment Date unless the Company shall default
on the payment of the interest due on such Interest Payment Date, in which
event such funds shall be paid to the Holder who delivered the same. Except as
provided in the preceding sentence and subject to the penultimate paragraph of
Section 2.13, no payment or adjustment shall be made upon any conversion on
account of any interest accrued on the Registered Securities surrendered for
conversion or on account of any dividends on the Parent Stock issued upon
conversion. If Bearer Securities of a series are convertible into Parent Stock,
then such Securities, to be converted, shall be surrendered, together with all
unmatured coupons and all matured coupons in default appertaining thereto, at
the place and in the manner specified for Bearer Securities of said series as
contemplated by Section 2.02.
Section 10.04. Fractional Shares.
The Company will not issue a fractional share of Parent Stock upon conversion
of a Security. Instead, the Company will deliver cash or its check for the
current market value of a fractional share. The current market value of a
fractional share is determined as follows: Multiply the current market price of
a full share on the last
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full trading day prior to the conversion date by the fraction (rounded to the
nearest 1/100 of a share) and round the result to the nearest whole cent.
Section 10.05. Taxes on Conversion.
If a Holder of a Security converts it, the Company shall pay any documentary,
stamp or similar issue or transfer tax due on the delivery of shares of Parent
Stock upon the conversion. The Holder, however, shall pay any such tax which is
due because the shares are issued in a name other than the Holder's name.
Section 10.06. Company to Provide Stock.
The Company shall (i) cause the Parent to, from time to time as may be
necessary, reserve out of Parent's authorized but unissued Parent Stock or
Parent Stock held in treasury enough shares of Parent Stock to permit the
conversion of all outstanding Securities and (ii) secure from the Parent (or
elsewhere) a sufficient number of shares of Parent Stock for delivery upon
conversion of Securities.
All shares of Parent Stock which may be delivered upon conversion of the
Securities shall be validly issued, fully paid and non-assessable and shall be
free from any preemptive rights.
In order that the Company may deliver shares of Parent Stock upon conversion
of the Securities, the Company will, and will cause the Parent to, endeavor to
comply with all applicable Federal and State securities laws and will endeavor
to cause such shares to be listed on each national or regional securities
exchange on which the Parent Stock is listed.
Section 10.07. Adjustment for Change in Capital Stock.
If the Parent:
(1) pays a dividend or makes a distribution on the Parent Stock in shares
of Parent Stock;
(2) subdivides the outstanding shares of Parent Stock into a greater
number of shares;
(3) combines the outstanding shares of Parent Stock into a smaller number
of shares;
(4) pays a dividend or makes a distribution on Parent Stock in shares of
its capital stock other than Parent Stock; or
(5) issues by reclassification of its shares of Parent Stock any shares
of its capital stock,
then the conversion privilege and the conversion price or conversion rate in
effect immediately prior to the opening of business on the record date for such
dividend or distribution or the effective date of such subdivision, combination
or reclassification shall be adjusted so that the Holder of any Security
thereafter converted may receive the number of shares of capital stock of the
Parent which such Holder would have owned immediately following such action if
such Holder had converted the Security immediately prior to such time. Such
adjustment shall be made successively whenever any event listed above shall
occur.
For a dividend or distribution, the adjustment shall become effective
immediately after the record date for the dividend or distribution. For a
subdivision, combination or reclassification, the adjustment shall become
effective immediately after the effective date of the subdivision, combination
or reclassification.
If after an adjustment a Holder of a Security upon conversion of it may
receive shares of two or more classes of capital stock of the Parent, the
conversion prices of the classes of capital stock (after giving effect to such
allocation of the adjusted conversion price between or among the classes of
capital stock as the Board of Directors shall determine to be appropriate) or
the conversion rate, as the case may be, shall thereafter be subject to
adjustment on terms comparable to those applicable to Parent Stock in this
Indenture.
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Any shares of Parent Stock issuable in payment of a dividend shall be deemed
to have been issued immediately prior to the time of the record date for such
dividend for purposes of calculating the number of outstanding shares of
Parent Stock under Sections 10.08 and 10.09 below.
Section 10.08. Adjustment for Rights Issue.
If the Parent issues any rights or warrants to all holders of shares of
Parent Stock entitling them for a period expiring within 45 days after the
record date mentioned below to purchase shares of Parent Stock (or Convertible
Securities) at a price per share (or having a conversion price per share,
after adding thereto an allocable portion of the exercise price of the right
or warrant to purchase such Convertible Securities, computed on the basis of
the maximum number of shares of Parent Stock issuable upon conversion of such
Convertible Securities) less than the Average Market Price on the
Determination Date, the conversion price or rate shall be adjusted so that it
shall equal the price or rate determined by multiplying the conversion price
or dividing the conversion rate, as the case may be, in effect immediately
prior to the opening of business on that record date by a fraction, of which
the numerator shall be the number of shares of Parent Stock outstanding on
such record date plus the number of shares of Parent Stock which the aggregate
offering price of the total number of shares of Parent Stock so offered (or
the aggregate conversion price of the Convertible Securities to be so offered,
after adding thereto the aggregate exercise price of the rights or warrants to
purchase such Convertible Securities) would purchase at such Average Market
Price and of which the denominator shall be the number of shares of Parent
Stock outstanding on such record date plus the number of additional shares of
Parent Stock offered for subscription or purchase (or into which the
Convertible Securities so offered are convertible). Shares of Parent Stock
owned by or held for the account of the Parent shall not be deemed outstanding
for the purpose of any such adjustment.
For purposes of this Section 10.08, the number of shares of Parent Stock
outstanding on any record date shall be deemed to include (i) the maximum
number of shares of Parent Stock the issuance of which would be necessary to
effect the full exercise, exchange or conversion of all Convertible Securities
outstanding on such record date which are then exercisable, exchangeable or
convertible at a price equal to or less than the Average Market Price per
share of Parent Stock, if all of such Convertible Securities were deemed to
have been exercised, exchanged or converted immediately prior to the opening
of business on such record date and (ii) if the Series B TCI Group Common
Stock is convertible into Parent Stock, the maximum number of shares of Parent
Stock the issuance of which would be necessary to effect the full conversion
of all shares of Series B TCI Group Common Stock outstanding on such record
date, if all of such shares of Series B TCI Group Common Stock were deemed to
have been converted immediately prior to the opening of business on such
record date.
The adjustment shall be made successively whenever any such rights or
warrants are issued, and shall become effective immediately after the record
date for the determination of stockholders entitled to receive the rights or
warrants. If all of the shares of Parent Stock (or all of the Convertible
Securities) subject to such rights or warrants have not been issued when such
rights or warrants expire (or, in the case of rights or warrants to purchase
Convertible Securities which have been exercised, all of the shares of Parent
Stock issuable upon conversion of such Convertible Securities have not been
issued prior to the expiration of the conversion right thereof), then the
conversion price or conversion rate shall promptly be readjusted to the
conversion price or conversion rate which would then be in effect had the
adjustment upon the issuance of such rights or warrants been made on the basis
of the actual number of shares of Parent Stock (or Convertible Securities)
issued upon the exercise of such rights or warrants (or the conversion of such
Convertible Securities).
No adjustment shall be made under this Section 10.08 if the adjusted
conversion price would be higher than, or the adjusted conversion rate would
be less than, the conversion price or conversion rate, as the case may be, in
effect prior to such adjustment.
Section 10.09. Adjustments for Other Distributions.
If the Parent distributes to all holders of shares of Parent Stock any
assets or debt securities or any rights or warrants to purchase securities,
the conversion price or conversion rate shall be adjusted by multiplying the
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conversion price or dividing the conversion rate, as the case may be, in
effect immediately prior to the opening of business on the record date
mentioned below by a fraction, of which the numerator shall be the total
number of shares of Parent Stock outstanding on such record date multiplied by
the Average Market Price on the Determination Date, less the fair market value
(as determined by the Board of Directors) on such record date of said assets
or debt securities or rights or warrants so distributed, and of which the
denominator shall be the total number of shares of Parent Stock outstanding on
such record date multiplied by such Average Market Price.
For purposes of this Section 10.09, the number of shares of Parent Stock
outstanding on any record date shall be deemed to include (i) the maximum
number of shares of Parent Stock the issuance of which would be necessary to
effect the full exercise, exchange or conversion of all Convertible Securities
outstanding on such record date which are then exercisable, exchangeable or
convertible at a price equal to or less than the Average Market Price, if all
of such Convertible Securities were deemed to have been exercised, exchanged
or converted immediately prior to the opening of business on such record date
and (ii) if the Series B TCI Group Common Stock is convertible into Parent
Stock, the maximum number of shares of Parent Stock the issuance of which
would be necessary to effect the full conversion of all shares of Series B TCI
Group Common Stock outstanding on such record date, if all of such shares of
Series B TCI Group Common Stock were deemed to have been converted immediately
prior to the opening of business on such record date.
The adjustment shall be made successively whenever any such distribution is
made, and shall become effective immediately after the record date for the
determination of stockholders entitled to receive the distribution. Shares of
Parent Stock owned by or held for the account of the Parent shall not be
deemed outstanding for the purpose of any such adjustment.
No adjustment shall be made under this Section 10.09 if the adjusted
conversion price would be higher than, or the adjusted conversion rate would
be less than, the conversion price or conversion rate, as the case may be, in
effect prior to such adjustment.
This Section does not apply to cash dividends or distributions. Also, this
Section does not apply to dividends or distributions referred to in Section
10.07 or to rights or warrants referred to in Section 10.08.
Section 10.10. Voluntary Adjustment.
The Company at any time may reduce the conversion price or increase the
conversion rate, temporarily or otherwise, by any amount but in no event shall
such adjusted conversion price or conversion rate result in shares of Parent
Stock being issuable upon conversion of the Securities if converted at the
time of such adjustment at an effective conversion price per share less than
the par value of the Parent Stock at the time such adjustment is made.
A voluntary adjustment of the conversion price or conversion rate pursuant
to this Section 10.10 does not change or adjust the conversion price or
conversion rate otherwise in effect for purposes of Section 10.07, 10.08 or
10.09. If an event requiring an adjustment to the conversion price or
conversion rate pursuant to Section 10.07, 10.08 or 10.09 occurs at any time
that a voluntary adjustment to the conversion price or conversion rate is in
effect pursuant to this Section 10.10, then the adjustment required by the
applicable of Section 10.07, 10.08 or 10.09 shall be made to the conversion
price or conversion rate that would otherwise have been in effect as of the
relevant date specified in such Section had no voluntary adjustment pursuant
to this Section 10.10 been made, and for purposes of applying such Section,
any such voluntary adjustment shall be disregarded. If such adjustment would
result in a lower conversion price or a higher conversion rate, as the case
may be, than the conversion price or conversion rate as voluntarily adjusted
by the Company, then such lower conversion price or higher conversion rate
shall be the conversion price or conversion rate, as the case may be.
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Section 10.11. Certain Definitions.
For the purposes of this Article, the following terms have the following
meanings:
"Average Market Price" of a share of Parent Stock on the Determination
Date for any issuance of rights or warrants or any distribution in respect
of which the Average Market Price is being calculated means the average of
the daily current market prices of the Parent Stock for the shortest of:
(i) the period of 30 consecutive trading days commencing 45 trading
days before such Determination Date,
(ii) the period commencing on the date next succeeding the first
public announcement of the issuance of rights or warrants or the
distribution in respect of which the Average Market Price is being
calculated and ending on the last full trading day before such
Determination Date, and
(iii) the period, if any, commencing on the date next succeeding the
Ex-Dividend Date with respect to the next preceding issuance of rights
or warrants or distribution for which an adjustment is required by the
provisions of Section 10.07(4), 10.08 or 10.09, and ending on the last
full trading day before such Determination Date.
If the record date for an issuance of rights or warrants or a
distribution for which an adjustment is required by the provisions of
Section 10.07(4), 10.08 or 10.09 (the "preceding adjustment event")
precedes the record date for the issuance or distribution in respect of
which the Average Market Price is being calculated and the Ex-Dividend Date
for such preceding adjustment event is on or after the Determination Date
for the issuance or distribution in respect of which the Average Market
Price is being calculated, then the Average Market Price shall be adjusted
by deducting therefrom the fair market value (on the record date for the
issuance or distribution in respect of which the Average Market Price is
being calculated), as determined by the Board of Directors, of the capital
stock, rights, warrants, assets or debt securities issued or distributed in
respect of each share of Parent Stock in such preceding adjustment event.
Further, in the event that the Ex-Dividend Date (or in the case of a
subdivision, combination or reclassification, the effective date with
respect thereto) with respect to a dividend, subdivision, combination or
reclassification to which Section 10.07(1), (2), (3) or (5) applies occurs
during the period applicable for calculating the Average Market Price, then
the Average Market Price shall be calculated for such period in a manner
determined by the Board of Directors to reflect the impact of such
dividend, subdivision, combination or reclassification on the current
market price of the Parent Stock during such period.
"current market price" of a share of Parent Stock on any day means the
last reported sale price (or, if no sale price is reported, the average of
the high and low bid prices) on such day on the Nasdaq Stock Market or as
quoted by the National Quotation Bureau Incorporated, or if the Parent
Stock is listed on an exchange, on the principal exchange on which the
Parent Stock is listed. In the event that no such quotation is available
for any day, the Board of Directors shall be entitled to determine the
current market price on the basis of such quotations as it considers
appropriate.
"Determination Date" for any issuance of rights or warrants or any
distribution to which Section 10.08 or 10.09 applies means the earlier of
(i) the record date for the determination of stockholders entitled to
receive the rights or warrants or the distribution to which such Section
applies and (ii) the Ex-Dividend Date for such rights, warrants or
distribution.
"Ex-Dividend Date" means the date on which "ex-dividend" trading
commences for a dividend, an issuance of rights or warrants or a
distribution to which any of Sections 10.07, 10.08 and 10.09 applies in the
over-the-counter market or on the principal exchange on which the Parent
Stock is then quoted or listed.
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Section 10.12. When Adjustment May Be Deferred.
In any case in which this Article shall require that an adjustment shall
become effective immediately after a record date for an event, the Company may
defer until the occurrence of such event (i) issuing to the Holder of any
Security converted after such record date and before the occurrence of such
event the additional shares of Parent Stock issuable upon such conversion by
reason of the adjustment required by such event over and above the shares of
Parent Stock issuable upon such conversion before giving effect to such
adjustment and (ii) paying to such Holder cash or its check in lieu of any
fractional interest to which he is entitled pursuant to Section 10.04;
provided, however, that the Company shall deliver to such Holder a due bill or
other appropriate instrument evidencing such Holder's rights to receive such
additional shares of Parent Stock, and such cash, upon the occurrence of the
event requiring such adjustment.
Section 10.13. When Adjustment Is Not Required.
No adjustments in the conversion price or conversion rate need be made unless
the adjustment would require an increase or decrease of at least one percent
(1%) in the initial conversion price or conversion rate. Any adjustment which
is not made shall be carried forward and taken into account in any subsequent
adjustment.
All calculations under this Article shall be made to the nearest cent or to
the nearest 1/100th of a share, as the case may be.
No adjustment in the conversion price or conversion rate shall be made
because the Parent issues, in exchange for cash, property or services, shares
of Parent Stock, or any securities convertible into or exchangeable for shares
of Parent Stock, or securities carrying the right to purchase shares of Parent
Stock or such convertible or exchangeable securities.
No adjustment in the conversion price or conversion rate need be made under
this Article for sales of shares of Parent Stock pursuant to a Parent plan
providing for reinvestment of dividends or interest or in the event the par
value of the Parent Stock is changed.
No adjustment in the conversion price or conversion rate need be made for a
transaction referred to in Section 10.07, 10.08 or 10.09 if Securityholders are
to participate in the transaction on a basis and with notice that the Board of
Directors determines to be fair and appropriate in light of the basis and
notice on which holders of Parent Stock participate in the transaction;
provided that the basis on which the Securityholders are to participate in the
transaction shall not be deemed to be fair if it would require the conversion
of Securities at any time prior to the expiration of the conversion period
specified for such Securities.
To the extent the Securities become convertible into cash, no adjustment need
be made thereafter as to the cash. Interest will not accrue on the cash.
Section 10.14. Notice of Adjustment.
Whenever the conversion price or conversion rate is adjusted, the Company
shall promptly give notice of the adjustment to Securityholders in accordance
with Section 11.02 hereof and file with the Trustee an Officers' Certificate
briefly stating the new conversion price or conversion rate, the date it
becomes effective, the facts requiring the adjustment and the manner of
computing it. The certificate shall be conclusive evidence that the adjustment
is correct.
Section 10.15. Notice of Certain Transactions.
If:
(1) the Parent takes any action which would require an adjustment in the
conversion price or conversion rate;
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<PAGE>
(2) the Parent consolidates or merges with, or transfers all or
substantially all of its assets to, another corporation, and stockholders
of the Parent must approve the transaction; or
(3) there is a dissolution or liquidation of the Parent,
a Holder of a Security may want to convert it into shares of Parent Stock prior
to the record date for, or the effective date of, the transaction so that he
may receive the rights, warrants, securities or assets which a holder of shares
of Parent Stock on that date may receive. Therefore, the Company shall give to
the Securityholders and the Trustee in accordance with Section 11.02 a notice
stating the proposed record or effective date, as the case may be. Failure to
give the notice or any defect in it shall not affect the validity of any
transaction referred to in clause (1), (2) or (3) of this Section.
Section 10.16. Consolidation, Merger or Sale of the Parent.
If the Parent is a party to a transaction described in Section 5.01 or a
merger which reclassifies or changes its outstanding Parent Stock, the Company
shall enter into a supplemental indenture. The supplemental indenture shall
provide that the Holder of a Security may convert it into the kind and amount
of securities or cash or other assets which he would have owned immediately
after the consolidation, merger or transfer if he had converted the Security
immediately before the effective date of such transaction, assuming (to the
extent applicable) that such Holder failed to exercise any rights of election
with respect thereto and received per share of Parent Stock the kind and amount
of securities, cash or assets received per share by a plurality of the non-
electing shares. The supplemental indenture shall provide for adjustments which
shall be as nearly equivalent as may be practical to the adjustments provided
for in this Article. The Company shall give to each Securityholder in
accordance with Section 11.02 a notice describing the supplemental indenture.
If this Section applies, Sections 10.07, 10.08 and 10.09 shall not apply.
Section 10.17. Company Determination Final.
Any determination which the Board of Directors must make pursuant to Section
10.07, 10.09, 10.11, 10.13 or 10.16 is conclusive and binding on the Holders.
Section 10.18. Trustee's and Conversion Agent's Disclaimer.
Neither the Trustee nor any Conversion Agent has any duty to determine when
an adjustment under this Article should be made, how it should be made or what
it should be. Neither the Trustee nor any Conversion Agent has any duty to
determine whether any provisions of a supplemental indenture under Section
10.16 are correct. Neither the Trustee nor any Conversion Agent makes any
representation as to the validity or value of any securities or assets issued
upon conversion of Securities. Neither the Trustee nor any Conversion Agent
shall be responsible for the Company's failure to comply with this Article.
Section 10.19. Simultaneous Adjustments.
In the event that this Article Ten requires adjustments to the conversion
price or conversion rate under more than one of Sections 10.07(4), 10.08 or
10.09, and the record dates for the distributions giving rise to such
adjustments shall occur on the same date, then such adjustments shall be made
by applying, first, the provisions of Section 10.07, second, the provisions of
Section 10.09 and, third, the provisions of Section 10.08.
55
<PAGE>
ARTICLE ELEVEN
Miscellaneous
Section 11.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by any of TIA (S)(S) 310 to 317, inclusive, through operation of
TIA (S) 318(c), such imposed duties shall control.
Section 11.02. Notices.
Any notice or communication (including any Act of Holders) shall be
sufficiently given if in writing and delivered in person or mailed by first-
class mail addressed as follows:
If to the Company:
TCI Communications, Inc.
Terrace Tower II
5619 DTC Parkway
Englewood, Colorado 80111-3000
Attention: Bernard W. Schotters,
Senior Vice President--Finance
and Treasurer
If to the Trustee:
The Bank of New York
101 Barclay Street, Floor 21W
New York, New York 10286
Attention: Corporate Trustee
Trustee Administration
The Company or the Trustee by notice to the other may designate additional or
different addresses for subsequent notices or communications.
Except as otherwise expressly provided herein or otherwise specified with
respect to any series of Securities issuable as Bearer Securities pursuant to
Section 2.02, where this Indenture provides for notice to Holders of Securities
of any event:
(1) such notice shall be sufficiently given to Holders of Registered
Securities if in writing and mailed, first-class postage prepaid, to each
Holder of a Registered Security affected by such event, at his address as
it appears in the security register, not later than the latest date, and
not earlier than the earliest date, prescribed for the giving of such
notice; and
(2) such notice shall be sufficiently given to Holders of Bearer
Securities if published in an Authorized Newspaper in the City of New York
and in such other city or cities as may be specified in such Securities on
a Business Day at least twice, the first such publication to be not earlier
than the earliest date, and not later than the latest date, prescribed for
the giving of such notice (except that, for purposes of Section 2.05,
notice of the appointment of a successor Authenticating Agent shall be
sufficiently given to Holders of Bearer Securities if published as provided
herein at least once.
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 to Holders of
Registered Securities by mail, then such notification as shall be made with the
approval of the Trustee shall constitute a sufficient notification for every
purpose hereunder. In any case where notice to Holders of Registered Securities
is given by mail, neither the failure to mail such notice, nor any defect in
any notice so mailed, to any particular Holder of a Registered Security shall
affect the sufficiency of such notice with respect to other Holders of
Registered Securities or the sufficiency of any notice to Holders of Bearer
Securities given as provided herein.
56
<PAGE>
In case by reason of the suspension of publication of any Authorized
Newspaper or Authorized Newspapers or by reason of any other cause it shall be
impracticable to publish any notice to Holders of Bearer Securities as provided
above, then such notification to Holders of Bearer Securities as shall be given
with the approval of the Trustee shall constitute sufficient notice to such
Holders for every purpose hereunder. Neither the failure to give notice by
publication to Holders of Bearer Securities as provided above, nor any defect
in any notice so published, shall affect the sufficiency of any notice to
Holders of Registered Securities given as provided herein.
Where this Indenture provides for notice in any manner, such notice may be
waived in writing by the person entitled to receive such notice, either before
or after the event, and such waiver shall be equivalent of such notice. Waivers
of notice by Holders of Securities shall be filed with the Trustee, but such
filing shall not be a condition precedent to the validity of any action taken
in reliance upon such waiver.
Except for a notice to the Trustee, which is deemed given only when received,
if a notice or communication is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it. Any notice or communication
published in the manner provided above shall be deemed to have been given on
the date of publication or, if published more than once, on the date of the
first such publication.
Any notice or communication required or permitted under this Indenture shall
be in the English language, except that any published notice may be in the
official language of the country of publication.
Section 11.03. Communication by Holders with Other Holders.
Securityholders may communicate pursuant to TIA (S) 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and anyone else shall have
the protection of TIA (S) 312(c).
Section 11.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee:
(1) an Officers' Certificate stating that, in the opinion of the signers,
all conditions precedent (including any covenants compliance with which
constitutes a condition precedent), if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such counsel,
all such conditions precedent (including any covenants compliance with
which constitutes a condition precedent) have been complied with.
Section 11.05. Statements Required in Certificate or Opinion.
Each Officers' Certificate or Opinion of Counsel with respect to compliance
with a condition or covenant provided for in this Indenture other than
certificates provided pursuant to Section 4.07 shall include:
(1) a statement that the person making such certificate or opinion has
read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such person, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and
(4) a statement as to whether or not, in the opinion of such person, such
condition or covenant has been complied with.
57
<PAGE>
Section 11.06. When Treasury Securities Disregarded.
In determining whether the Holders of the required aggregate principal amount
of outstanding Securities of any series have given any request, demand,
authorization, direction, notice, consent or waiver or taken any other action
hereunder, Securities of such series owned by the Company or by any Affiliate
of the Company shall be disregarded and deemed not to be outstanding, except
that for the purpose of determining whether the Trustee shall be protected in
relying on such request, demand, authorization, direction, notice, consent,
waiver or action, only Securities of such series which the Trustee actually
knows are so owned shall be so disregarded. Securities so owned that 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 to so act with respect
to such Securities and that the pledgee is not the Company or any Affiliate of
the Company.
Section 11.07. Rules by Trustee and Agents.
Subject to Section 11.15 and Article Twelve, the Trustee may make reasonable
rules for action by or a meeting of Securityholders of all series or any
series. The Registrar, Paying Agent or Conversion Agent may make reasonable
rules for its functions.
Section 11.08. Legal Holidays.
A "Legal Holiday" with respect to any place of payment or conversion or other
location is a Saturday, a Sunday or a day on which banking institutions or
trust companies in that place of payment, conversion or other location are not
authorized or required to be open. If a payment date or the last day to convert
a Security is a Legal Holiday at a place of payment or conversion, payment or
conversion may be made at that place on the next succeeding day that is not a
Legal Holiday, and no interest or original issue discount, as the case may be,
shall accrue for the intervening period.
Section 11.09. Governing Law.
The internal laws of the State of New York shall govern this Indenture, the
Securities and coupons.
Section 11.10. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or debt
agreement of the Company or a Subsidiary. Any such indenture, loan or debt
agreement may not be used to interpret this Indenture.
Section 11.11. No Recourse Against Others.
No past, present or future director, officer, employee or stockholder, as
such, of the Company or the Trustee or any successor of either thereof shall
have any liability for any obligations of the Company or the Trustee under the
Securities or any coupons appertaining thereto or this Indenture or for any
claim based on, in respect of, or by reason of, such obligations or their
creation and all such liability is hereby waived and released. Such waiver and
release are part of the consideration for the issue of the Securities.
Section 11.12. Successors.
All agreements of the Company in this Indenture and the Securities shall bind
its successor. All agreements of the Trustee in this Indenture shall bind its
successor.
Section 11.13. Duplicate Originals.
The parties may sign any number of copies of this Indenture. Each signed copy
shall be an original, but all of them together represent the same agreement.
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Section 11.14. Table of Contents, Headings, etc.
The table of contents and the titles and headings of the Articles and
Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part hereof, and shall in no way modify or
restrict any of the terms or provisions hereof.
Section 11.15. Acts of Holders.
(a) Any request, demand, authorization, direction, notice, consent, waiver or
other action provided by this Indenture to be given or taken by Holders may be
embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by an agent duly appointed in
writing. If Securities of a series are issuable as Bearer Securities, any
request, demand, authorization, direction, notice, consent, waiver or other
action provided by this Indenture to be given or taken by Holders of Securities
of such series may, alternatively, be embodied in and evidenced by the record
of Holders of Securities of such series voting in favor thereof, either in
person or by proxies duly appointed in writing, at any meeting of Holders of
Securities of such series duly called and held in accordance with the
provisions of Article Twelve, or a combination of such instruments and any such
record. Except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments or record or both are delivered
to the Trustee and, where it is hereby expressly required, to the Company. Such
instrument or instruments and any such record (and the action embodied therein
and evidenced thereby) are herein sometimes referred to as the "Act" of the
Holders signing such instrument or instruments and so voting at any such
meeting. Proof of execution of any such instrument or of a writing appointing
any such agent, or of the holding by any person of a Security, shall be
sufficient for any purpose of this Indenture and (subject to Section 7.01)
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. The record of
any meeting of Holders of Securities shall be proved in the manner provided in
Section 12.06.
(b) The fact and date of the execution by any person of any such instrument
or writing may be proved by the affidavit of a witness of such execution or by
a certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds. Where such execution is by a signer acting in a
capacity other than his individual capacity, such certificate or affidavit
shall also constitute sufficient proof of his authority. The fact and date of
the execution of any such instrument or writing, or the authority of the person
executing the same, may also be proved in any other manner which the Trustee
deems sufficient.
(c) The ownership, principal amount and serial numbers of outstanding
Registered Securities held by any person, and the date of holding the same,
shall be proved by the security register.
(d) The ownership, principal amount and serial numbers of outstanding Bearer
Securities held by any person, and the date of holding the same, may be proved
by the production of such Bearer Securities or by a certificate executed, as
depositary, by any trust company, bank, banker or other depositary, wherever
situated, if such certificate shall be deemed by the Trustee to be
satisfactory, showing that at the date therein mentioned such person had on
deposit with such depositary or exhibited to it, the Bearer Securities therein
described, or such facts may be proved by the certificate or affidavit of the
person holding such Bearer Securities, if such certificate or affidavit is
deemed by the Trustee to be satisfactory. The Trustee and the Company may
assume that such ownership of any Bearer Securities continues until (1) another
certificate or affidavit bearing a later date issued in respect of the same
Bearer Security is produced, or (2) such Bearer Security is produced to the
Trustee by some other person or (3) such Bearer Security is surrendered in
exchange for a Registered Security or (4) such Bearer Security is no longer
outstanding. The ownership, principal amount and serial numbers of outstanding
Bearer Securities held by any person, and the date of holding the same, may
also be proved in any other manner which the Trustee deems sufficient.
(e) If the Company shall solicit from the Holders of any Registered
Securities any request, demand, authorization, direction, notice, consent,
waiver or other Act, the Company may at its option (but is not obligated to),
by or pursuant to a resolution of the Board of Directors, fix in advance a
record date for the determination of
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<PAGE>
Holders of Registered Securities entitled to give such request, demand,
authorization, direction, notice, consent, waiver or other Act. Notwithstanding
TIA (S) 316(c), such record date shall be the record date specified in or
pursuant to such resolution of the Board of Directors, which shall be a date
not earlier than 30 days prior to the first solicitation of Holders generally
in connection therewith and not later than the date such solicitation is
completed. If such a record date is fixed, such request, demand, authorization,
direction, notice, consent, waiver or other Act may be given before or after
such record date, but only the Holders of Registered Securities of record at
the close of business on such record date shall be deemed to be Holders for the
purpose of determining whether Holders of the requisite proportion of
outstanding Securities have authorized or agreed or consented to such request,
demand, authorization, direction, notice, consent, waiver or other Act, and for
that purpose the outstanding Securities shall be computed as of such record
date; provided that no such authorization, agreement or consent by the Holders
of Registered Securities shall be deemed effective unless it shall become
effective pursuant to the provisions of this Indenture not later than eleven
months after the record date.
(f) Any request, demand, authorization, direction, notice, consent, waiver or
other action by the Holder of any Security shall bind such Holder and every
future Holder of the same Security and the Holder of every Security issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by the Trustee, any
Agent or the Company in reliance thereon, whether or not notation of such
action is made upon such Security.
ARTICLE TWELVE
Meetings of Holders of Securities
Section 12.01. Purposes for which Meetings may be Called.
If Securities of a series are issuable as Bearer Securities, a meeting of
Holders of Securities of such series may be called at any time and from time to
time pursuant to this Article to make, give or take any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be made, given or taken by Holders of Securities of such
series.
Section 12.02. Call, Notice and Place of Meetings.
(a) The Trustee may at any time call a meeting of Holders of Securities of
any series for any purpose specified in Section 12.01, to be held at such time
and at such place in the Borough of Manhattan, the City of New York, or in
London as the Trustee shall determine. Notice of every meeting of Holders of
Securities of any series, setting forth the time and the place of such meeting
and in general terms the action proposed to be taken at such meeting, shall be
given, in the manner provided in Section 11.02, not less than 21 nor more than
180 days prior to the date for the meeting.
(b) In case at any time the Company pursuant to a resolution of the Board of
Directors or the Holders of at least 10% of the aggregate principal amount of
outstanding Securities of any series shall have requested the Trustee to call a
meeting of the Holders of Securities of such series for any purpose specified
in Section 12.01, by written request setting forth in reasonable detail the
action proposed to be taken at the meeting, and the Trustee shall not have made
the first publication of the notice of such meeting within 21 days after
receipt of such request or shall not thereafter proceed to cause the meeting to
be held as provided herein, the Company or the Holders of Securities of such
series in the amount above specified, as the case may be, may determine the
time and the place in the Borough of Manhattan, the City of New York, or in
London for such meeting and may call such meeting for such purposes by giving
notice thereof as provided in subsection (a) of this Section.
Section 12.03. Persons Entitled to Vote at Meetings.
To be entitled to vote at any meeting of Holders of Securities of any series,
a person shall be (1) a Holder of one or more outstanding Securities of such
series, or (2) a person appointed by an instrument in writing as
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proxy for a Holder or Holders of one or more outstanding Securities of such
series by such Holder or Holders. The only persons who shall be entitled to be
present or to speak at any meeting of Holder of Securities of any series shall
be the persons entitled to vote at such meeting and their counsel, any
representatives of the Trustee and its counsel and any representatives of the
Company and its counsel.
Section 12.04. Quorum; Action.
The persons entitled to vote a majority of the aggregate principal amount of
the outstanding Securities of a series shall constitute a quorum for a meeting
of Holders of Securities of such series. In the absence of a quorum within 30
minutes of the time appointed for any such meeting, the meeting shall, if
convened at the request of Holders of Securities of such series, be dissolved.
In any other case the meeting may be adjourned for a period of not less than 10
days as determined by the chairman of the meeting prior to the adjournment of
such meeting. In the absence of a quorum at any such adjourned meeting, such
adjourned meeting may be further adjourned for a period of not less than 10
days as determined by the chairman of the meeting prior to the adjournment of
such adjourned meeting. Notice of the reconvening of any adjourned meeting
shall be given as provided in Section 12.02(a), except that such notice shall
be given only once not less than five days prior to the date on which the
meeting is scheduled to be reconvened.
Except as limited by the third sentence of Section 9.02, any resolution
presented to a meeting or adjourned meeting duly reconvened at which a quorum
is present as aforesaid may be adopted by the affirmative vote of the Holders
of a majority in aggregate principal amount of the outstanding Securities of
that series; provided, however, that, except as limited by the third sentence
and of Section 9.02, any resolution with respect to any request, demand,
authorization, direction, notice, consent, waiver or other action which this
Indenture expressly provides may be made, given or taken by the Holders of a
specified percentage, which is less than a majority, in aggregate principal
amount of the outstanding Securities of a series, may be adopted at a meeting
or an adjourned meeting duly reconvened at which a quorum is present as
aforesaid, by the affirmative vote of the Holders of such specified percentage
in aggregate principal amount of the outstanding Securities of that series.
Any resolution passed or decision taken at any meeting of Holders of
Securities of any series duly held in accordance with this Section shall be
binding on all the Holders of Securities of such series and the related
coupons, whether or not present or represented at the meeting.
Notwithstanding the foregoing provisions of this Section 12.04, if any action
is to be taken at a meeting of Holders of Securities of any series with respect
to any request, demand, authorization, direction, notice, consent, waiver or
other action that this Indenture expressly provides may be made, given or taken
by the Holders of a specified percentage in aggregate principal amount of all
outstanding Securities affected thereby, or of the Holders of such series and
one or more additional series:
(i) there shall be no minimum quorum requirement for such meeting; and
(ii) the principal amount of the outstanding Securities of such series
that vote in favor of such request, demand, authorization, direction,
notice, consent, waiver or other action shall be taken into account in
determining whether such request, demand, authorization, direction, notice,
consent, waiver or other action has been made, given or taken under this
Indenture.
Section 12.05. Determination of Voting Rights; Conduct and Adjournment of
Meetings.
(a) Notwithstanding any other provisions of this Indenture, the Trustee may
make such reasonable regulations as it may deem advisable for any meeting of
Holders of Securities of a series in regard to proof of the holding of
Securities of such series and of the appointment of proxies and in regard to
the appointment and duties of inspectors of votes, the submission and
examination of proxies, certificates and other evidence of the right to vote
and such other matters concerning the conduct of the meeting as it shall deem
appropriate. Except as otherwise permitted or required by any such regulations,
the holding of Securities shall be proved in the manner specified in Section
11.15 and the appointment of any proxy shall be proved in the manner specified
in
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Section 11.15 or by having the signature of the person executing the proxy
witnessed or guaranteed by any trust company, bank or banker authorized by
Section 11.15 to certify to the holding of Bearer Securities. Such regulations
may provide that written instruments appointing proxies, regular on their face,
may be presumed valid and genuine without the proof specified in Section 11.15
or other proof.
(b) The Trustee shall by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Holders of Securities as provided in Section 12.02(b), in which
case the Company or the Holders of Securities of the series calling the
meeting, as the case may be, shall in like manner appoint a temporary chairman.
A permanent chairman and a permanent secretary of the meeting shall be elected
by vote of the persons entitled to vote a majority of the aggregate principal
amount of the outstanding Securities of such series represented at the meeting.
(c) At any meeting each Holder of a Security of such series or proxy shall be
entitled to one vote for each $1,000 principal amount of the outstanding
Securities of such series held or represented by him, provided, however, that
no vote shall be cast or counted at any meeting in respect of any Security
challenged as not outstanding and ruled by the chairman of the meeting to be
not outstanding. The chairman of the meeting shall have no right to vote,
except as a Holder of a Security of such series or proxy.
(d) Any meeting of Holders of Securities of any series duly called pursuant
to Section 12.02 at which a quorum is present may be adjourned from time to
time by persons entitled to vote a majority of the aggregate principal amount
of the outstanding Securities of such series represented at the meeting and the
meeting may be held as so adjourned without further notice.
Section 12.06. Counting Votes and Recording Action of Meetings.
The vote upon any resolution submitted to any meeting of Holders of
Securities of any series shall be by written ballots on which shall be
subscribed the signatures of the Holders of Securities of such series or of
their representatives by proxy and the principal amount and serial numbers of
the outstanding Securities of such series held or represented by them. The
permanent chairman of the meeting shall appoint two inspectors of votes who
shall count all votes cast at the meeting for or against any resolution and who
shall make and file with the secretary of the meeting their verified written
reports in duplicate of all votes cast at the meeting. A record, at least in
duplicate, of the proceedings of each meeting of Holders of Securities of any
series shall be prepared by the secretary of the meeting and there shall be
attached to said record the original reports of the inspectors of votes on any
vote by ballot taken thereat and affidavits by one or more persons having
knowledge of the facts setting forth a copy of the notice of the meeting and
showing that said notice was given as provided in Section 12.02 and, if
applicable, Section 12.04. Each copy shall be signed and verified by the
affidavits of the permanent chairman and secretary of the meeting and one such
copy shall be delivered to the Company, and another to the Trustee to be
preserved by the Trustee, the latter to have attached thereto the ballots voted
at the meeting. Any record so signed and verified shall be conclusive evidence
of the matters therein stated.
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Signatures
Dated: April 25, 1991
Tele-Communications, Inc
By __________________________________
Vice President--Finance
(Seal)
Attest: _____________________________
Assistant Secretary
Dated: April 25, 1991
Chemical Bank
By __________________________________
(Seal)
Attest:
63
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EXHIBIT 4.2
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TCI COMMUNICATIONS, INC.
AND
,
TRUSTEE
----------------
INDENTURE
DATED AS OF , 199
----------------
SENIOR SUBORDINATED DEBT SECURITIES
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
CROSS-REFERENCE TABLE
<TABLE>
<CAPTION>
TIA INDENTURE
SECTION SECTION
<C> <S> <C>
310 (a)(1).............................................. 7.10
(a)(2).............................................. 7.10
(a)(3).............................................. N.A.
(a)(4).............................................. N.A.
(a)(5).............................................. 7.10
(b)................................................. 7.08; 7.10; 12.02
(c)................................................. N.A.
311 (a)................................................. 7.11
(b)................................................. 7.11
(c)................................................. N.A.
312 (a)................................................. 2.07
(b)................................................. 12.03
(c)................................................. 12.03
313 (a)................................................. 7.06
(b)(1).............................................. N.A.
(b)(2).............................................. 7.06
(c)................................................. 12.02
(d)................................................. 7.06
314 (a)................................................. 4.02; 4.03; 12.02
(b)................................................. N.A.
(c)(1).............................................. 12.04
(c)(2).............................................. 12.04
(c)(3).............................................. N.A.
(d)................................................. N.A.
(e)................................................. 12.05
(f)................................................. N.A.
315 (a)................................................. 7.01(b)
(b)................................................. 7.05; 12.02
(c)................................................. 7.01(a)
(d)................................................. 7.01(c)
(e)................................................. 6.11
316 (a)(last sentence).................................. 12.06
(a)(1)(A)........................................... 6.05
(a)(1)(B)........................................... 6.04
(a)(2).............................................. N.A.
(b)................................................. 6.07
317 (a)(1).............................................. 6.08
(a)(2).............................................. 6.09
(b)................................................. 2.06
318 (a)................................................. 12.01
</TABLE>
- --------
N.A. means Not Applicable.
2
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TABLE OF CONTENTS
----------------
<TABLE>
<CAPTION>
Section Heading Page
<C> <S> <C>
ARTICLE ONE
Definitions and Incorporation by Reference
1.01. Definitions...................................................... 7
1.02. Other Definitions................................................ 9
1.03. Incorporation by Reference of Trust Indenture Act................ 9
1.04. Rules of Construction............................................ 9
ARTICLE TWO
The Securities
2.01. Forms Generally and Dating....................................... 9
2.02. Amount Unlimited; Issuable in Series............................. 10
2.03. Denominations.................................................... 12
2.04. Execution and Authentication..................................... 12
2.05. Registrar, Paying Agent and Conversion Agent..................... 14
2.06. Paying Agent to Hold Money and Securities in Trust............... 14
2.07. Securityholder Lists............................................. 14
2.08. Transfer and Exchange............................................ 14
2.09. Replacement Securities........................................... 16
2.10. Outstanding Securities........................................... 16
2.11. Temporary Securities............................................. 17
2.12. Cancellation..................................................... 17
2.13. Payment of Interest; Defaulted Interest.......................... 17
2.14. Persons Deemed Owners............................................ 18
2.15. Securities in Global Form........................................ 18
ARTICLE THREE
Redemption
3.01. Applicability of Article......................................... 19
3.02. Notices to Trustee............................................... 19
3.03. Selection of Securities to be Redeemed........................... 19
3.04. Notice of Redemption............................................. 20
3.05. Effect of Notice of Redemption................................... 20
3.06. Deposit of Redemption Price...................................... 20
3.07. Securities Redeemed in Part...................................... 21
3.08. Conversion Arrangement on Call For Redemption.................... 21
ARTICLE FOUR
Covenants
4.01. Payment of Securities............................................ 21
4.02. SEC Reports...................................................... 21
4.03. Compliance Certificate........................................... 22
4.04. Corporate Existence.............................................. 22
4.05. Securities Senior to Junior Subordinated Debt.................... 22
4.06. Limitation on Subordinated Debt Senior to the Securities......... 23
</TABLE>
3
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<TABLE>
<CAPTION>
Section Heading Page
<C> <S> <C>
ARTICLE FIVE
Successor Corporation
5.01. When Company May Merge, etc...................................... 23
ARTICLE SIX
Defaults and Remedies
6.01. Events of Default................................................ 23
6.02. Acceleration..................................................... 24
6.03. Other Remedies................................................... 24
6.04. Waiver of Existing Defaults...................................... 25
6.05. Control by Majority.............................................. 25
6.06. Limitation on Suits.............................................. 25
6.07. Rights of Holders to Receive Payment and to Convert.............. 25
6.08. Collection Suit by Trustee....................................... 26
6.09. Trustee May File Proofs of Claim................................. 26
6.10. Priorities....................................................... 26
6.11. Undertaking for Costs............................................ 26
ARTICLE SEVEN
Trustee
7.01. Duties of Trustee................................................ 26
7.02. Rights of Trustee................................................ 27
7.03. Individual Rights of Trustee..................................... 27
7.04. Trustee's Disclaimer............................................. 27
7.05. Notice of Defaults............................................... 28
7.06. Reports by Trustee to Holders.................................... 28
7.07. Compensation and Indemnity....................................... 28
7.08. Replacement of Trustee........................................... 28
7.09. Successor Trustee by Merger, etc................................. 29
7.10. Eligibility; Disqualification.................................... 29
7.11. Preferential Collection of Claims Against Company................ 29
ARTICLE EIGHT
Discharge of Indenture
8.01. Termination of Company's Obligations............................. 29
8.02. Application of Trust Fund........................................ 30
8.03. Repayment to Company............................................. 30
ARTICLE NINE
Amendments, Supplements and Waivers
9.01. Without Consent of Holders....................................... 30
9.02. With Consent of Holders.......................................... 31
9.03. Compliance with Trust Indenture Act.............................. 32
9.04. Revocation and Effect of Consents................................ 32
9.05. Notation on or Exchange of Securities............................ 32
9.06. Trustee to Sign Amendments, etc. ................................ 32
</TABLE>
4
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<TABLE>
<CAPTION>
Section Heading Page
<C> <S> <C>
ARTICLE TEN
Subordination
10.01. Securities Subordinated to Senior Debt........................... 32
10.02. Company Not to Make Payments with Respect to Securities in
Certain Circumstances........................................... 33
10.03. Securities Subordinated to Prior Payment of All Senior Debt on
Dissolution, Liquidation or Reorganization of Company........... 33
10.04. Securityholders to be Subrogated to Right of Holders of Senior
Debt............................................................ 34
10.05. Obligation of the Company Unconditional.......................... 34
10.06. Trustee Entitled to Assume Payments Not Prohibited in Absence of
Notice......................................................... 35
10.07. Application by Trustee of Monies or U.S. Government Obligations
Deposited with It............................................... 35
10.08. Subordination Rights Not Impaired by Acts or Omissions of Company
or Holders of Senior Debt....................................... 36
10.09. Securityholders Authorize Trustee to Effectuate Subordination of
Securities..................................................... 36
10.10. Right of Trustee to Hold Senior Debt............................. 36
10.11. Article Ten Not to Prevent Events of Default..................... 36
ARTICLE ELEVEN
Conversion
11.01. Applicability of Article......................................... 36
11.02. Conversion Privilege............................................. 37
11.03. Conversion Procedure............................................. 37
11.04. Fractional Shares................................................ 38
11.05. Taxes on Conversion.............................................. 38
11.06. Company to Provide Stock......................................... 38
11.07. Adjustment for Change in Capital Stock........................... 38
11.08. Adjustment for Rights Issue...................................... 39
11.09. Adjustments for Other Distributions.............................. 40
11.10. Voluntary Adjustment............................................. 40
11.11. Certain Definitions.............................................. 41
11.12. When Adjustment May Be Deferred.................................. 42
11.13. When Adjustment Is Not Required.................................. 42
11.14. Notice of Adjustment............................................. 42
11.15. Notice of Certain Transactions................................... 43
11.16. Consolidation, Merger or Sale of the Company..................... 43
11.17. Company Determination Final...................................... 43
11.18. Trustee's Disclaimer............................................. 43
11.19. Simultaneous Adjustments......................................... 43
ARTICLE TWELVE
Miscellaneous
12.01. Trust Indenture Act Controls..................................... 44
12.02. Notices.......................................................... 44
12.03. Communication by Holders with Other Holders...................... 44
</TABLE>
5
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<TABLE>
<CAPTION>
Section Heading Page
<C> <S> <C>
12.04. Certificate and Opinion as to Conditions Precedent............... 44
12.05. Statements Required in Certificate or Opinion.................... 45
12.06. When Treasury Securities Disregarded............................. 45
12.07. Rules by Trustee and Agents...................................... 45
12.08. Legal Holidays................................................... 45
12.09. Governing Law.................................................... 45
12.10. No Adverse Interpretation of Other Agreements.................... 45
12.11. No Recourse Against Others....................................... 45
12.12. Successors....................................................... 46
12.13. Duplicate Originals.............................................. 46
12.14. Table of Contents, Headings, etc. ............................... 46
Signatures................................................................ 47
</TABLE>
6
<PAGE>
INDENTURE dated as of , 199 , between TCI COMMUNICATIONS, INC., a
Delaware corporation ("Company"), and ("Trustee").
The Company has duly authorized the execution and delivery of this Indenture
to provide for the issuance from time to time of its unsecured senior
subordinated debentures, notes, bonds or other evidences of subordinated
indebtedness ("Securities"), to be issued in one or more series as provided in
this Indenture.
Each party agrees as follows for the benefit of the other party and for the
equal and ratable benefit of the respective Holders from time to time of
Securities or of series thereof:
ARTICLE ONE
Definitions and Incorporation by Reference
Section 1.01. Definitions.
Affiliate of any person means any other person directly or indirectly
controlling or controlled by or under direct or indirect common control with
such person.
Agent means any Registrar, Paying Agent, co-Registrar or Conversion Agent.
See Section 2.05.
Board of Directors means the Board of Directors of the Company or any
authorized committee thereof.
Business Day means any day which is not a Legal Holiday.
Class B Stock means the Class B Common Stock, $1.00 par value, of the
Company as it exists on the date of this Indenture and stock of any other
class into which such Class B Common Stock may thereafter have been changed.
Company means TCI Communications, Inc., a Delaware corporation, until a
successor replaces it pursuant to the applicable provisions of this Indenture
and thereafter means the successor.
Convertible Securities means any or all options, warrants, securities and
rights, except the Series B TCI Group Common Stock and the Securities, which
are convertible into or exercisable or exchangeable for Parent Stock or which
otherwise entitle the holder thereof to subscribe for, purchase or otherwise
acquire Parent Stock.
Default means any event which is, or after notice or passage of time or both
would be, an Event of Default.
Holder or Securityholder means the person in whose name a Security is
registered on the Registrar's books.
Indenture means this Indenture as amended or supplemented from time to time
and, unless the context indicates otherwise, shall include the form and terms
of a particular series of Securities established as contemplated hereunder.
interest, when used with respect to an Original Issue Discount Security
which by its terms bears interest only after maturity or upon default in any
other payment due on such Security, means interest payable after maturity or
upon such a default, as the case may be.
Interest Payment Date means the date, if any, specified in the Securities of
any series as the fixed date on which any installment of interest on the
Securities of that series is due and payable.
7
<PAGE>
Officer means the Chairman of the Board, the President, any Vice President,
the Treasurer or the Secretary of the Company.
Officers' Certificate means a certificate signed by two Officers or by an
Officer and an Assistant Treasurer or an Assistant Secretary of the Company
and delivered to the Trustee. See Sections 12.04 and 12.05.
Opinion of Counsel means a written opinion from legal counsel who is
acceptable to the Trustee. The counsel may be an employee of or counsel to the
Company or the Trustee. See Sections 12.04 and 12.05.
original issue discount of any debt security, including any Original Issue
Discount Security, means the difference between the principal amount of such
debt security and the initial issue price of such debt security (as set forth,
in the case of an Original Issue Discount Security, on the face of such
Security).
Original Issue Discount Security means any Security which provides for an
amount less than the principal amount thereof to be due and payable upon
acceleration of the maturity thereof pursuant to Section 6.02.
Parent means Tele-Communications, Inc., a Delaware corporation, and any
successor thereof.
Parent Stock means the Tele-Communications, Inc. Series A TCI Group Common
Stock, $1.00 par value, as it exists on the date of this Indenture and any
other capital stock into which such Series A TCI Group Common Stock may
thereafter have been changed.
principal of a debt security, including any Security, means the amount
(including, without limitation, if and to the extent applicable, any premium
and, in the case of an Original Issue Discount Security, any accrued original
issue discount, but excluding interest) that is payable with respect to such
debt security as of any date and for any purpose (including, without
limitation, in connection with any sinking fund, upon any redemption at the
option of the Company, upon any purchase or exchange at the option of the
Company or the holder of such debt security and upon any acceleration of the
maturity of such debt security).
principal amount of a debt security, including any Security, means the
principal amount as set forth on the face of such debt security.
Regular Record Date means the date, if any, specified in the Securities of
any series as the record date for the determination of Securityholders to whom
interest is payable on the next succeeding Interest Payment Date.
SEC means the Securities and Exchange Commission.
Securities means the Securities that are issued from time to time in one or
more series under this Indenture as such Securities are amended or
supplemented from time to time.
Series B TCI Group Common Stock means the Tele-Communications, Inc. Series B
TCI Group Common Stock, $1.00 par value, as it exists on the date of this
Indenture and any other capital stock into which such Series B TCI Group
Common Stock may thereafter have been changed.
Subsidiary means a corporation a majority of whose voting stock is owned by
the Company and/or one or more Subsidiaries. Voting stock is capital stock
having voting power under ordinary circumstances to elect directors.
TIA means the Trust Indenture Act of 1939 (15 U.S. Code (S)(S)77aaa-77bbbb)
as in effect on the date of this Indenture, except as provided in Section
9.03.
Trustee means the party named as such in this Indenture until a successor
replaces it and thereafter means the successor and if at any time there is
more than one such party, "Trustee" as used with respect to the Securities of
any series shall mean the Trustee with respect to Securities of that series.
Trust Officer means an officer or assistant officer in the Corporate Trust
Administration department of the Trustee assigned by the Trustee to administer
its corporate trust matters.
United States means the United States of America.
U.S. Government Obligations means direct obligations of, or obligations
entitled to the full faith and credit of, the United States of America.
8
<PAGE>
Section 1.02. Other Definitions.
<TABLE>
<CAPTION>
DEFINED IN
TERM SECTION
<S> <C>
Average Market Price.......................................... 11.11
Bankruptcy Law................................................ 6.01
Code.......................................................... 9.01
Conversion Agent.............................................. 2.05
current market price.......................................... 11.11
Custodian..................................................... 6.01
Debt.......................................................... 10.01
Determination Date............................................ 11.11
Event of Default.............................................. 6.01
Ex-Dividend Date.............................................. 11.11
Junior Subordinated Debt...................................... 4.05
Legal Holiday................................................. 12.08
Paying Agent.................................................. 2.05
Registrar..................................................... 2.05
Senior Debt................................................... 10.01
</TABLE>
Section 1.03. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
Commission means the SEC.
indenture securities means the Securities.
indenture security holder means a Securityholder.
indenture to be qualified means this Indenture.
indenture trustee or institutional trustee means the Trustee.
obligor on the indenture securities means the Company and any other
obligor thereon.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule have the
meanings assigned to them.
Section 1.04. Rules of Construction.
Unless the context otherwise requires;
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned to
it in accordance with generally accepted accounting principles in effect on
the date of this Indenture;
(3) "or" is not exclusive; and
(4) words in the singular include the plural, and in the plural include
the singular.
ARTICLE TWO
The Securities
Section 2.01. Forms Generally and Dating.
The Securities of each series may be issued in whole or in part in the form
of one or more global Securities as shall be specified as contemplated by
Section 2.02. The Securities of each series (including any temporary
9
<PAGE>
global Securities) shall be in one of the forms established from time to time
by or pursuant to a resolution of the Board of Directors or in or pursuant to
one or more indentures supplemental hereto, which shall set forth the
information required by Section 2.02. The Securities shall have such
appropriate insertions, omissions, substitutions and other variations as are
required or permitted by this Indenture or by a resolution of the Board of
Directors and may have such notations, legends or endorsements as the Company
may deem appropriate and as are not inconsistent with the provisions of this
Indenture, or as may be required by law, stock exchange rule or usage. The
Company shall approve the form or forms of the Securities and any notation,
legend or endorsement on them. If the form or forms of Securities of any series
is established by action taken pursuant to a resolution of the Board of
Directors or indenture supplemental hereto, a copy of an appropriate record of
such action shall be certified by the Secretary or an Assistant Secretary of
the Company and delivered to the Trustee at or prior to the delivery of the
written order of the Company contemplated by Section 2.04 for the
authentication and delivery of such Securities.
Each Security shall be dated the date of its authentication. The form of the
Trustee's certificate of authentication to be borne by the Securities shall be
substantially as follows:
CERTIFICATE OF AUTHENTICATION
The undersigned certifies that this is one of the Securities of the series
designated herein referred to in the within-mentioned Indenture.
,
as Trustee
By___________________________________
Authorized Officer
Section 2.02. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. There shall be
established in or pursuant to a resolution of the Board of Directors or
established in or pursuant to one or more indentures supplemental hereto, prior
to the issuance of Securities of any series:
(1) the title of the Securities of the series (which shall distinguish
Securities of the series from all other Securities);
(2) any limit upon the aggregate principal amount of Securities of the
series which may be authenticated and delivered under this Indenture
(except for Securities authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other Securities of the
series pursuant to Section 2.08, 2.09, 2.11, 3.07, or 9.05 and except for
any Securities which pursuant to Section 2.04 are deemed not to have been
authenticated and delivered hereunder);
(3) (A) whether any of the Securities of the series are to be issuable in
global form and, if so, (i) the identity of the depositary with respect to
any such global Security and (ii) whether beneficial owners of interests in
any such global Security may exchange such interests for Securities of the
same series and of like tenor and of any authorized form and denomination,
and, if so, the circumstances under which and the manner in which any such
exchanges may occur, if other than as specified in Section 2.08; (B) if any
of the Securities of the series are to be issuable in global form, the date
as of which any global Security shall be
10
<PAGE>
dated (if other than the date of original issuance of the first of such
Securities to be issued); and (C) if Securities of the series are to be
issuable in definitive form (whether upon original issue, upon exchange of
a temporary Security of such series, or in exchange for a beneficial
ownership interest in a permanent global Security) only upon receipt of
certain certificates or other documents or satisfaction of other
conditions, or if Securities of the series are initially issuable in
temporary global form and if owners of beneficial interests therein may
exchange such interest for an interest in a permanent global Security only
upon receipt of certain certificates or other documents or satisfaction of
other conditions, then the form and/or terms of such certificates,
documents or conditions;
(4) the date or dates (and whether fixed or extendible) on which the
principal of Securities of the series is payable;
(5) the rate or rates at which Securities of the series shall bear
interest, or the method of determining the same, if any, the date or dates
from which such interest shall accrue, the Interest Payment Dates and the
Regular Record Dates;
(6) the place or places where the principal of and any interest on
Securities of the series shall be payable;
(7) any provisions relating to the issuance of Securities of such series
at an original issue discount (including, without limitation, the issue
price thereof, the rate or rates at which such original issue discount
shall accrue, if any, and the date or dates from or to which or period or
periods during which such original issue discount shall accrue at such rate
or rates);
(8) the price or prices at which, the period or periods within which and
the terms and conditions upon which Securities of the series may be
redeemed or otherwise purchased, in whole or in part, at the option of the
Company, pursuant to any sinking fund or otherwise (including, without
limitation, the form or method or payment thereof if other than in cash);
(9) the obligation, if any, of the Company to redeem, purchase or repay
Securities of the series pursuant to any sinking fund or analogous
provisions or at the option of a Securityholder thereof and the price or
prices at which and the period or periods within which and the terms and
conditions upon which Securities of the series shall be redeemed, purchased
or repaid, in whole or in part, pursuant to such obligation (including,
without limitation, the form or method of payment thereof if other than in
cash);
(10) if other than denominations of $1,000 and any integral multiple
thereof, the denominations in which Securities of the series shall be
issuable;
(11) if other than the principal amount thereof, the portion of the
principal amount of Securities of the series which shall be payable upon
declaration of acceleration of the maturity thereof pursuant to Section
6.02 or provable in bankruptcy pursuant to Section 6.09, or, if applicable,
which is convertible in accordance with Article Eleven;
(12) any Events of Default with respect to the Securities of a particular
series in lieu of or in addition to those set forth herein and the remedies
therefor;
(13) the obligation, if any, of the Company to permit the conversion of
Securities of such series into Parent Stock and the terms and conditions
upon which such conversion shall be effected (including, without
limitation, the initial conversion price or rate, the conversion period and
any other provision in addition to or in lieu of those set forth in this
Indenture relative to such obligation); and
(14) any other terms of a particular series and any other provisions
expressing or referring to the terms and conditions upon which the
Securities of that series are to be issued under the Indenture, which terms
and provisions are not in conflict with the provisions of this Indenture;
provided, however, that the addition to or subtraction from or variation of
Articles Four, Five, Six, Eight and Eleven (and Sections 1.01 and 1.02,
insofar as they relate to the definition of certain terms as used in such
Articles) with regard to the Securities of a particular series shall not be
deemed to constitute a conflict with the provisions of those Articles.
11
<PAGE>
All Securities of any one series shall be substantially identical except as
to denomination and except as may otherwise be provided in or pursuant to such
resolution of the Board of Directors or in any such indenture supplemental
hereto. Not all Securities of any one series need be issued at the same time,
and, unless otherwise so provided, a series may be reopened for issuances of
additional Securities of such series.
If any of the terms of the Securities of a series are established by action
taken pursuant to a resolution of the Board of Directors or indenture
supplemental hereto, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee with an Officers' Certificate setting forth the terms
or the manner of determining the terms of the Securities of such series. With
respect to Securities of a series which are not to be issued at one time, such
resolution of the Board of Directors or action may provide general terms or
parameters for Securities of such series and provide either that the specific
terms of particular Securities of such series shall be specified in a written
order of the Company or that such terms shall be determined by the Company or
its agents in accordance with a written order of the Company as contemplated by
the proviso clause of the fourth paragraph of Section 2.04.
Section 2.03. Denominations.
The Securities of each series shall be issuable in registered form without
coupons in such denominations as shall be specified as contemplated by Section
2.02. In the absence of any such provisions with respect to the Securities of
any series, the Securities of such series shall be issuable in denominations of
$1,000 and any integral multiple thereof.
Section 2.04. Execution and Authentication.
Two Officers shall sign the Securities for the Company by facsimile
signature. The Company's seal shall be reproduced on the Securities.
If an Officer whose signature is on a Security no longer holds the office at
the time the Trustee authenticates the Security, the Security shall be valid
nevertheless.
A Security shall not be entitled to any benefit under this Indenture or be
valid for any purpose until the Trustee manually signs the certificate of
authentication on the Security. The signature shall be conclusive evidence that
the Security has been authenticated under this Indenture. Notwithstanding the
foregoing, if any Security shall have been duly authenticated and delivered
hereunder but never issued and sold by the Company, and the Company shall
deliver such Security to the Trustee for cancellation as provided in Section
2.12 together with a written statement (which need not comply with Section
12.04 and 12.05 and need not be accompanied by an Opinion of Counsel) stating
that such Security has not been issued and sold by the Company, for all
purposes of this Indenture such Security shall be deemed not to have been
authenticated and delivered hereunder and shall not be entitled to the benefits
of this Indenture.
At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Securities of any series executed by the
Company to the Trustee for authentication, and the Trustee shall authenticate
and deliver said Securities to or upon the written order of the Company, signed
by two Officers or by an Officer and an Assistant Treasurer of the Company,
without any further action by the Company. Such written order shall specify the
date on which said Securities shall be authenticated; provided, however, that
if not all the Securities of a series are to be issued at one time and if the
resolution of the Board of Directors or indenture supplemental hereto
establishing such series as contemplated by Sections 2.01 and 2.02 shall so
permit, such written order may set forth procedures acceptable to the Trustee
for the issuance of such Securities and for determining the form or terms of
particular Securities of such series including, but not limited to, interest
rate, maturity date, date of issuance and date from which interest shall
accrue.
If the form or forms or terms of the Securities of the series have been
established in or pursuant to one or more resolutions of the Board of Directors
or indentures supplemental hereto as permitted by Sections 2.01 and
12
<PAGE>
2.02, in authenticating such Securities, and accepting the additional
responsibilities under this Indenture in relation to such Securities, the
Trustee shall be entitled to receive, and (subject to Section 7.01) shall be
fully protected in relying upon, an Opinion of Counsel stating:
(1) if the form or forms of such Securities has been established by or
pursuant to a resolution of the Board of Directors or indenture
supplemental hereto, that such form or forms has been established in
conformity with the provisions of the Indenture;
(2) if the terms of such Securities have been established by or pursuant
to a resolution of the Board of Directors or indenture supplemental hereto,
that such terms have been established in conformity with the provisions of
the Indenture; and
(3) that such Securities, when authenticated and delivered by the Trustee
and issued by the Company in the manner and subject to any conditions
specified in such Opinion of Counsel, will constitute valid and legally
binding obligations of the Company, enforceable in accordance with their
terms, subject to bankruptcy, insolvency, fraudulent conveyance,
reorganization and other laws of general applicability relating to or
affecting the enforcement of creditors' rights and to general equitable
principles;
provided, however, that, with respect to Securities of a series which are not
to be issued at one time, the Trustee shall be entitled to receive such Opinion
of Counsel only once at or prior to the time of the first authentication of
Securities of such series and that the opinions described in clauses (2) and
(3) above may state, respectively,
(a) that, when the terms of such Securities shall have been established
pursuant to a written order of the Company or pursuant to such procedures
as may be specified from time to time by a written order of the Company,
all as contemplated by and in accordance with a resolution of the Board of
Directors or an Officers' Certificate pursuant to a resolution of the Board
of Directors or indenture supplemental hereto, as the case may be, such
terms will have been established in conformity with the provisions of this
Indenture; and
(b) that such Securities, when (i) executed by the Company, (ii)
completed, authenticated and delivered by the Trustee in accordance with
this Indenture, (iii) issued and delivered by the Company and (iv) paid
for, all as contemplated by and in accordance with the aforesaid written
order of the Company or specified procedures, as the case may be, will
constitute valid and legally binding obligations of the Company,
enforceable in accordance with their terms, subject to bankruptcy,
insolvency, fraudulent conveyance, reorganization and other laws of general
applicability relating to or affecting the enforcement of creditors' rights
and general equitable principles.
Notwithstanding the provisions of Sections 2.01, 2.02, 12.04 and this
Section, if all the Securities of a series are not to be originally issued at
one time, the resolution of the Board of Directors or indenture supplemental
hereto, the certified copy of the record of action taken pursuant to such
resolution or supplemental indenture, the Officers' Certificate, the written
order of the Company and any other documents otherwise required pursuant to
such Sections need not be delivered to or prior to the time of authentication
of each Security of such series if such documents are delivered at or prior to
the authentication upon original issuance of the first Security of such series
to be issued; provided, however, that any subsequent request by the Company to
the Trustee to authenticate Securities of such series shall constitute a
representation and warranty by the Company that as of the date of such request,
the statements, made in the Officers' Certificate delivered pursuant to Section
12.04 at or prior to authentication of the first such Security shall be true
and correct on the date thereof.
The Trustee shall have the right to decline to authenticate and make
available for delivery any Securities under this Section if the issuance of
such Securities pursuant to this Indenture will affect the Trustee's own
rights, duties or immunities under the Securities and this Indenture or
otherwise in a manner which is not reasonably acceptable to the Trustee.
With respect to Securities of a series which are not all issued at one time,
the Trustee may conclusively rely, as to the authorization by the Company of
any of such Securities, the form and terms thereof and the legality, validity,
binding effect and enforceability thereof, upon the Opinion of Counsel,
Officers' Certificate
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and other documents delivered pursuant to Sections 2.01, 2.02, 12.04 and this
Section, as applicable, at or prior to the time of the first authentication of
Securities of such series unless and until such opinion, certificate or other
documents have been superseded or revoked. In connection with the
authentication and delivery of Securities of a series which are not all issued
at one time, the Trustee shall be entitled to assume that the Company's
instructions to authenticate and deliver such Securities do not violate any
rules, regulations or orders of any governmental agency or commission having
jurisdiction over the Company.
Section 2.05. Registrar, Paying Agent and Conversion Agent.
The Company shall maintain an office or agency where Securities of each
series may be presented for registration of transfer or for exchange
("Registrar"), an office or agency where Securities of each series may be
presented for payment ("Paying Agent") and an office or agency where Securities
of each series that is convertible may be presented for conversion ("Conversion
Agent"). The Registrar shall keep a register of the Securities of each series
issued hereunder and of their transfer and exchange. The Company may have one
or more co-Registrars (provided that there shall be only one register, which
shall be maintained by the principal Registrar), one or more additional paying
agents and one or more additional conversion agents with respect to any series.
The term "Paying Agent" includes any additional paying agent and the term
"Conversion Agent" includes any additional conversion agent.
The Company shall enter into an appropriate agency agreement with any Agent
not a party to this Indenture. The agreement shall implement the provisions of
this Indenture that relate to such Agent. The Company shall promptly notify the
Trustee of the name and address of any such Agent. If the Company fails to
maintain a Registrar, Paying Agent or Conversion Agent, the Trustee shall act
as such.
The Company initially appoints the Trustee as Registrar and Paying Agent for
each series and a Conversion Agent for any series that is convertible.
Section 2.06. Paying Agent to Hold Money and Securities in Trust.
Subject to Section 10.07, each Paying Agent shall hold in trust for the
benefit of Securityholders of the relevant series or the Trustee all money and
securities held by the Paying Agent for the payment of any amount in respect of
the Securities of such series, and shall notify the Trustee of any default by
the Company in making any such payment. If the Company or a Subsidiary acts as
Paying Agent, it shall segregate such money and securities and hold them as a
separate trust fund. The Company at any time may require a Paying Agent to pay
all money and securities held by it to the Trustee and account for any fund or
securities disbursed. Upon doing so the Paying Agent shall have no further
liability for the money or securities.
Section 2.07. Securityholder Lists.
The Trustee shall preserve in as current a form as is reasonably practicable
the most recent list available to it of the names and addresses of
Securityholders. If the Trustee is not the Registrar, the Company shall furnish
to the Trustee on or before either (1) April 1 and October 1 in each year in
the case of Original Issue Discount Securities of any series which by their
terms do not bear interest prior to maturity (other than upon a default in any
payment upon such a Security) or (2) the Interest Payment Date for the
Securities of any other series, but in no event less frequently than semi-
annually, and at such other times as the Trustee may request in writing a list
in such form and as of such date as the Trustee may reasonably require of the
names and addresses of Securityholders.
Section 2.08. Transfer and Exchange.
Where a Security is presented to the Registrar or a co-Registrar with a
request to register a transfer, the Registrar shall register the transfer as
requested if its requirements for such transfer are met. Where Securities are
presented in the Registrar or a co-Registrar with a request to exchange them
for an equal aggregate principal amount of Securities of the same series of
other authorized denominations, the Registrar shall make the exchange
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as requested if its requirements for such exchange are met. The Registrar shall
require, among other things, that any Security presented or surrendered for
transfer or exchange be duly endorsed, or be accompanied by appropriate
transfer documents duly executed, by the Holder thereof or his attorney duly
authorized in writing. To permit transfers and exchanges, the Trustee shall
authenticate Securities at the Registrar's request. Any exchange or transfer
shall be without charge, except that the Company may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto.
The Registrar need not transfer or exchange any Security selected for
redemption or purchase (except, in the case of Securities to be redeemed or
purchased in part, the portion thereof not to be redeemed or purchased) or any
Security in respect of which a notice requiring the purchase or redemption
thereof by the Company at the option of the Holder has been given and not
withdrawn by the Holder thereof in accordance with the terms of such Securities
(except, in the case of Securities to be so purchased or redeemed in part, the
portion thereof not to be so purchased or redeemed), or transfer or exchange
Securities of any particular series during a period of 15 days before a
selection of Securities of such series to be redeemed.
Except as otherwise provided with respect to the Securities of any series as
contemplated by Section 2.02, a global Security may be exchanged only as
provided below in this Section.
If at any time the depositary with respect to a global Security representing
all or a portion of the Securities of or within a series notifies the Company
that it is unwilling, unable or ineligible to continue as such depositary, the
Company shall appoint a successor depositary with respect to such Securities.
Unless otherwise provided with respect to a series of Securities as
contemplated by Section 2.02, if a successor depositary is not so appointed by
the Company within 90 days after the Company receives such notice, the Company
will execute and the Trustee, upon receipt of a written order of the Company as
contemplated by Section 2.04 for the authentication and delivery of definitive
Securities of such series (or, if such written order has previously been
delivered, then upon receipt of written instructions from the person or persons
specified in such written order), will authenticate and deliver Securities of
such series in definitive form equal in aggregate principal amount to the
principal amount of the global Security or Securities representing such series
in exchange for such global Security or Securities.
The Company may at any time and in its sole discretion determine that the
Securities of any series issued in the form of one or more global Securities
shall no longer be represented by such global Security or Securities. In such
event the Company will execute and the Trustee, upon receipt of a written order
of the Company as contemplated by Section 2.04 for the authentication and
delivery of definitive Securities of such series (or, if such written order has
previously been delivered, then upon receipt of written instructions from the
person or persons specified in such written order), will authenticate and
deliver Securities of such series in definitive form equal in aggregate
principal amount to the principal amount of the global Security or Securities
representing such series in exchange for such global Security or Securities.
If a global Security is otherwise exchangeable as specified by the Company
pursuant to Section 2.02(3) with respect to a series of Securities, the
depositary with respect to a global Security representing all or a portion of
the Securities of or within such series may surrender such global Security to
the Trustee, as the Company's agent for such purpose, to be exchanged in whole
or in part for Securities of such series in definitive form in the manner and
under the circumstances so specified and on such terms as are acceptable to the
Company and such depositary. In such event, the Company shall execute and the
Trustee shall authenticate and deliver or make available for delivery:
(i) to each Person specified by such depositary a new Security or
Securities of the same series and of like tenor, of any authorized form and
denomination as requested by such Person in aggregate principal amount
equal to and in exchange for such Person's beneficial interest in the
global Security; and
(ii) unless endorsement of the surrendered global Security as
contemplated by Section 2.15 or another procedure is specified for the
Securities of such series as contemplated by Section 2.02, to such
depositary a new global Security in a denomination equal to the difference,
if any, between the principal amount of the
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surrendered global Security and the aggregate principal amount of
Securities delivered pursuant to clause (i) above in exchange for
beneficial interests in such surrendered global Security.
In any exchange provided for in any of the preceding three paragraphs, the
Company will execute and the Trustee will authenticate and deliver Securities
in definitive registered form in authorized denominations.
Upon the exchange of a global Security for Securities in definitive form,
such global Security shall be cancelled by the Trustee, unless endorsement of
the surrendered global Security as contemplated by Section 2.15 or another
procedure is specified for the Securities of such series as contemplated by
Section 2.02. Securities issued in exchange for a global Security pursuant to
this Section shall be registered in such names and in such authorized
denominations as the depositary for such global Security, pursuant to
instructions from its direct or indirect participants or otherwise, shall
instruct the Trustee. The Trustee shall deliver such Securities to the persons
in whose names such Securities are so registered.
If a Security is issued in exchange for any portion of a global Security
after the close of business at the office or agency where such exchange occurs
(i) on any Regular Record Date and before the opening of business at such
office or agency on the relevant Interest Payment Date, or (ii) on any special
record date and before the opening of business at such office or agency on the
related date for payment of defaulted interest, interest or defaulted interest,
as the case may be, will not be payable on such Interest Payment Date or
proposed date for payment, as the case may be, in respect of such Security, but
will be payable on such Interest Payment Date or proposed date for payment, as
the case may be, only to the Person to whom interest in respect of such portion
of such global Security is payable in accordance with the provisions of this
Indenture.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Securities
surrendered upon such registration of transfer or exchange.
Section 2.09. Replacement Securities
If a mutilated Security is surrendered to the Registrar or if the Holder of a
Security claims that the Security has been lost, destroyed or wrongfully taken,
then, in the absence of notice to the Company or the Trustee that such Security
has been acquired by a bona fide purchaser, the Company shall issue and the
Trustee shall authenticate a replacement Security if the Trustee's requirements
are met. If required, such Holder shall furnish an indemnity bond sufficient in
the judgment of the Company and the Trustee to protect the Company, the Trustee
or any Agent from any loss which any of them may suffer if a Security is
replaced. The Company may charge for its expenses in replacing a Security.
Every replacement Security is an additional obligation of the Company.
In case any such lost, destroyed or wrongfully-taken Security has become or
is about to become due and payable, or is about to be purchased by the Company
pursuant to any provision of the Securities of such series providing for the
purchase thereof at the option of the Holder or the Company, the Company in its
discretion may, instead of issuing a new Security, pay or purchase such
Security.
Section 2.10. Outstanding Securities
Securities outstanding at any time are all Securities authenticated by the
Trustee except for those cancelled by it, those delivered to it for
cancellation and those described in this Section as not being outstanding. A
Security does not cease to be outstanding because the Company or one of its
Affiliates holds the Security.
If a Security is replaced pursuant to Section 2.09, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser.
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If the Paying Agent holds on a redemption date or maturity date or on the
Business Day following a date on which Securities of such series are to be
purchased by the Company pursuant to any provision thereof providing for such
purchase at the option of the Holder or the Company, money (or securities if
permitted by the terms of such Securities) in trust or, if the Company, acting
as its own Paying Agent, sets aside and segregates money (or securities if
permitted by the terms of such Securities) in trust, sufficient to pay
Securities payable on that date, then on and after that date such Securities
cease to be outstanding and interest, if any (and original issue discount, if
Original Issue Discount Securities) on them ceases to accrue, unless the
Trustee or the Paying Agent is restricted under Article Ten in applying such
money.
Section 2.11 Temporary Securities.
Until a permanent global Security or definitive Securities are ready for
delivery, the Company may prepare and the Trustee shall authenticate temporary
Securities. Temporary Securities of any series shall be substantially in the
form of definitive Securities of such series, but may have variations that the
Company considers appropriate for temporary Securities. Without unreasonable
delay, the Company shall prepare and the Trustee shall authenticate definitive
Securities in exchange for temporary Securities of the same series. Until so
exchanged the temporary Securities of any series shall in all respect be
entitled to the same benefits under this Indenture as definitive Securities of
such series.
Section 2.12. Cancellation.
The Company at any time may deliver Securities to the Trustee for
cancellation, including Securities authenticated which the Company has not
issued and sold. The Company, Paying Agent and Conversion Agent shall forward
to the Trustee any Securities surrendered to them for transfer, exchange,
payment, redemption, purchase by the Company pursuant to any provision thereof
providing for such purchase at the option of the Holder, or conversion. The
Trustee and no one else shall cancel all Securities surrendered for transfer,
exchange, payment, redemption, purchase, conversion or cancellation, and may
dispose of cancelled Securities as the Company directs. Except as otherwise
provided in the resolution of the Board of Directors or indenture supplemental
hereto establishing such series as contemplated by Section 2.02, the Company
may not issue new Securities of a series to replace Securities of the same
series that it has paid or that have been delivered to the Trustee for
cancellation.
Section 2.13. Payment of Interest; Defaulted Interest.
Interest (except defaulted interest) on the Securities of any series which is
payable on any Interest Payment Date shall be paid to the persons who are
Holders of such series at the close of business on the Regular Record Date for
such interest payment. At the option of the Company, payment of interest on any
Security may be made by check mailed to the Holder's registered address.
If the Company defaults in a payment of interest on the Securities of any
series on any Interest Payment Date, it shall pay the defaulted interest to the
persons who are Securityholders of such series at the close of business on a
subsequent special record date. The Company shall fix the record date and
payment date. At least 15 days before the record date, the Company shall mail
to each Securityholder of such series a notice that states the record date, the
payment date and the amount of defaulted interest to be paid. The Company shall
notify the Trustee in writing of the amount of defaulted interest proposed to
be paid on each Security of such series and the date of the proposed payment,
and at the same time the Company shall deposit with the Paying Agent 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 Paying Agent
for such deposit prior to the date of the proposed payment. The Company may pay
defaulted interest in any other lawful manner.
Unless otherwise provided with respect to the Securities of any series as
contemplated by Section 2.02, in the case of any Security of any series which
is converted after any Regular Record Date and on or prior to the next
succeeding Interest Payment Date (other than any Security which is due and
payable prior to such Interest
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Payment Date), interest which is due and payable on such Interest Payment Date
shall be payable on such Interest Payment Date notwithstanding such conversion,
and such interest shall be paid to the Holder in whose name that Security is
registered at the close of business on such Regular Record Date.
Section 2.14. Persons Deemed Owners.
Prior to due presentment of a Security for registration of transfer, the
Company, the Trustee and any Agent may treat the person in whose name such
Security is registered as the owner of such Security for the purpose of
receiving payment of principal of and (subject to Section 2.13) interest on
such Security and for all other purposes whatsoever, and neither the Company,
the Trustee nor any Agent shall be affected by notice to the contrary.
No holder of any beneficial interest in any global Security held on its
behalf by a depositary shall have any rights under this Indenture with respect
to such global Security, and such depositary (or its nominee, if such global
Security is registered in the name of a nominee) may be treated by the Company,
the Trustee, and any Agent as the owner of such global Security for all
purposes whatsoever. None of the Company, the Trustee, or any Agent will have
any responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests of a global Security
or for maintaining, supervising or reviewing any records relating to such
beneficial ownership interests.
Notwithstanding the foregoing, with respect to any global Security, nothing
herein shall prevent the Company, the Trustee, or any Agent from giving effect
to any written certification, proxy or other authorization furnished by any
depositary, as a Holder, with respect to such global Security or impair, as
between such depositary and owners of beneficial interests in such global
Security, the operation of customary practices governing the exercise of the
rights of such depositary (or its nominee) as Holder of such global Security.
Section 2.15. Securities in Global Form.
If the Company shall establish pursuant to Section 2.02 that the Securities
of or within a series are to be issued in whole or in part in global form, then
the Company shall execute, and the Trustee shall, in accordance with Section
2.04 and the written order of the Company contemplated thereby, authenticate
and deliver one or more global Securities in temporary or permanent form that
(i) shall be registered in the name of the depositary for such global Security
or Securities or the nominee of such depositary, (ii) shall be delivered by the
Trustee to such depositary or pursuant to such depositary's instructions, and
(iii) shall bear a legend substantially to the following effect: "Unless and
until it is exchanged in whole or in part for Securities in definitive form,
this Security may not be transferred except as a whole by the depositary to a
nominee of the depositary or another nominee of the depositary or by the
depositary or any such nominee to a successor depositary or a nominee of such
successor depositary." Each depositary designated pursuant to Section 2.02 for
a global Security in registered form must be, to the extent required by
applicable law or regulation, a clearing agency registered under the Securities
Exchange Act of 1934, as amended, and any other applicable statute or
regulation, at the time of its designation and at all times that it serves as
depositary. Notwithstanding clause (14) of Section 2.02 and the provisions of
Section 2.03, any such global Security shall represent such of the outstanding
Securities of such series as shall be specified therein and may provide that it
shall represent the aggregate amount of outstanding Securities of such series
from time to time endorsed thereon and that the aggregate amount of outstanding
Securities represented thereby may from time to time be increased or decreased
to reflect exchanges. Any endorsement of a Security in a global form to reflect
the amount, or any increase or decrease in the amount, or changes in the rights
of Holders, of outstanding Securities represented thereby shall be made in such
manner and upon instructions given by such Person or Persons as shall be
specified therein or in the written order of the Company to be delivered to the
Trustee pursuant to Section 2.04. Subject to the provisions of Section 2.04
and, if applicable, Section 2.11, the Trustee shall deliver and redeliver any
Security in permanent global form in the manner and upon instructions given by
the Person or Persons specified therein or in the applicable written order of
the Company. If a written order of the Company pursuant to Section 2.04 has
been, or simultaneously is, delivered, any instructions with respect to a
Security in global form shall be in writing but need not comply with Sections
12.04 and 12.05 and need not be accompanied by an Opinion of Counsel.
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The provisions of the last sentence of the third paragraph of Section 2.04
shall apply to any Security represented by a Security in global form if such
Security was never issued and sold by the Company and the Company delivers to
the Trustee the Security in global form together with written instructions
(which need not comply with Sections 12.04 and 12.05 and need not be
accompanied by an Opinion of Counsel) with regard to the reduction in the
principal amount of Securities represented thereby, together with the written
statement contemplated by the last sentence of the third paragraph of Section
2.04.
ARTICLE THREE
Redemption
Section 3.01. Applicability of Article.
Securities of any series which are redeemable before their stated maturity at
the election of the Company or through the operation of any sinking fund for
the requirement of Securities of such series shall be redeemable in accordance
with their terms and (except as otherwise specified as contemplated by Section
2.02 for Securities of any series) in accordance with this Article.
Section 3.02. Notices to Trustee.
If the Company elects to redeem all or less than all the Securities of any
series, it shall notify the Trustee of the redemption date, the principal
amount of Securities to be redeemed, the specific provision of the Securities
pursuant to which the Securities being called for redemption are being redeemed
and the redemption price. In the case of any redemption of Securities prior to
the expiration of any restriction on such redemption provided in the terms of
such Securities or elsewhere in this Indenture, the Company shall furnish the
Trustee with an Officers' Certificate evidencing compliance with such
restriction. If the Company wants to make any permitted optional sinking fund
payment, it shall notify the Trustee of the principal amount of the Securities
to be redeemed.
The Company (1) may deliver outstanding Securities of a series (other than
any previously called for redemption) and (2) may apply as a credit Securities
of a series which (i) have been redeemed or otherwise purchased either at the
election of the Company pursuant to the terms of such Securities or through the
application of permitted optional sinking fund payments pursuant to the terms
of such Securities or (ii) have been converted pursuant to the terms of such
Securities, in each case in satisfaction of all or any part of any sinking fund
payment required to be made pursuant to the terms of the Securities of such
series as provided for by the terms of such series; provided that such
Securities have not been previously so credited. Such Securities shall be
received and credited for such purpose by the Trustee at the redemption price
specified in such Securities for redemption through operation of the sinking
fund and the amount of such sinking fund payment shall be reduced accordingly.
The Company shall notify the Trustee of its intention to so reduce the amount
of such sinking fund payment, the amount of the reduction and the basis for it.
The Company shall deliver to the Trustee with such notice any Securities to be
credited for such purpose that it has not previously delivered to the Trustee
for cancellation.
The Company shall give each notice and Officers' Certificate provided for in
this Section at least 60 days before the redemption date (unless a shorter
notice shall be satisfactory to the Trustee or is otherwise specified as
contemplated by Section 2.02 for Securities of any series).
Section 3.03. Selection of Securities to be Redeemed.
Except as otherwise specified as contemplated by Section 2.02 for Securities
of any series, if less than all the Securities of any series are to be
redeemed, the particular Securities to be redeemed shall be selected from
Securities of the same series outstanding not previously called for redemption
by lot or by such method as the Trustee considers fair and appropriate (and in
such manner as complies with applicable requirements of any stock
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exchange on which Securities of such series are listed) and which may provide
for the selection for redemption of portions (equal to the minimum authorized
denomination for Securities of that series or any integral multiple thereof) of
the principal amount of Securities of such series that have denominations
larger than the minimum authorized denomination for Securities of that series.
Provisions of this Indenture that apply to Securities called for redemption
also apply to portions of Securities called for redemption. If any Security
selected for partial redemption is converted in part after such selection but
before the termination of the conversion right with respect to the portion of
the Security so selected, the converted portion of such Security shall be
deemed (so far as may be practicable) to be the portion selected for
redemption.
Section 3.04. Notice of Redemption.
At least 30 days but not more than 60 days before a redemption date (unless a
shorter notice is specified as contemplated by Section 2.02 for Securities of
any series), the Company shall mail a notice of redemption by first-class mail
to each Holder of Securities of the series to be redeemed.
The notice shall identify the Securities (and, in the case of partial
redemption, the principal amounts of the Securities) to be redeemed and shall
state:
(1) the redemption date;
(2) the redemption price and method of payment, if other than in cash;
(3) if applicable, the current conversion price or rate;
(4) the name and address of the Paying Agent and, if applicable, the
Conversion Agent;
(5) if applicable, that the right of the Holder to convert Securities
called for redemption shall terminate at the close of business on the
fifteenth day prior to the redemption date (or such other day as may be
specified as contemplated by Section 2.02 for Securities of any series);
(6) if applicable, that Holders who want to convert Securities called for
redemption must satisfy the requirements for conversion contained in such
Securities;
(7) that Securities called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(8) that interest, if any (or original issue discount, if Original Issue
Discount Securities), on Securities called for redemption ceases to accrue
on and after the redemption date unless the Company defaults in making such
redemption payment; and
(9) that the redemption is for a sinking fund or at the election of the
Company, whichever is the case.
At the Company's request, the Trustee shall give the notice of redemption in
the Company's name and at the Company's expense.
Section 3.05. Effect of Notice of Redemption.
Once notice of redemption is mailed, Securities of the series called for
redemption become due and payable on the redemption date and at the redemption
price. Upon surrender to the Paying Agent, such Securities shall be paid at the
redemption price, plus, if applicable, accrued interest, if any, to the
redemption date; provided, however, that installments of interest the Interest
Payment Date for which is on or prior to the redemption date shall be payable
to the persons who are Holders of such Securities on the relevant record dates
for such interest according to their terms and Section 2.13.
Section 3.06. Deposit of Redemption Price.
On or before noon, New York time, on the redemption date, the Company shall
deposit with the Paying Agent money in immediately available funds (or
securities if permitted by the terms of such Securities) sufficient to pay the
redemption price of, and (except if the redemption date is an Interest Payment
Date) accrued interest,
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if any, on, all Securities to be redeemed on that date other than Securities or
portions thereof called for redemption on that date which are delivered by the
Company to the Trustee for cancellation. The Paying Agent shall return to the
Company any money (or securities) not required for that purpose because of
conversion of Securities.
Section 3.07. Securities Redeemed in Part.
Upon surrender of a Security that is redeemed in part, the Trustee shall
authenticate for the Holder a new Security of the same series, of any
authorized denomination requested by such Holder, equal in principal amount to
the unredeemed portion of the Security surrendered.
Section 3.08. Conversion Arrangement on Call for Redemption.
In connection with any redemption of Securities, the Company may arrange for
the purchase and conversion of any Securities called for redemption by an
agreement with one or more investment bankers or other purchasers to purchase
such Securities by paying to the Trustee in trust for the Securityholders, on
or before the close of business on the redemption date, an amount in cash not
less than the redemption price, together with interest, if any, accrued to the
redemption date, of such Securities. Notwithstanding anything to the contrary
contained in this Article Three, the obligation of the Company to pay the
redemption price of such Securities, including all accrued interest, if any,
shall be deemed to be satisfied and discharged to the extent such amount is so
paid by such purchasers. If such an agreement is entered into, any Securities
not duly surrendered for conversion by the Holders thereof may, at the option
of the Company, be deemed, to the fullest extent permitted by law, acquired by
such purchasers from such Holders and (notwithstanding anything to the contrary
contained in Article Eleven) surrendered by such purchasers for conversion, all
as of immediately prior to the close of business on the last day on which
Securities of such series called for redemption may be converted in accordance
with this Indenture and the terms of such Securities, subject to payment of the
above amount as aforesaid. The Trustee shall hold and pay to the Holders whose
Securities are selected for redemption any such amount paid to it in the same
manner as it would moneys deposited with it by the Company for the redemption
of Securities. Without the Trustee's prior written consent, no arrangement
between the Company and such purchasers for the purchase and conversion of any
Securities shall increase or otherwise affect any of the powers, duties,
responsibilities or obligations of the Trustee as set forth in this Indenture,
and the Company agrees to indemnify the Trustee from, and hold it harmless
against, any loss, liability or expense arising out of or in connection with
any such arrangement for the purchase and conversion of any Securities between
the Company and such purchasers, including the costs and expenses incurred by
the Trustee in the defense of any claim or liability arising out of or in
connection with the exercise or performance of any of its powers, duties,
responsibilities or obligations under this Indenture.
ARTICLE FOUR
Covenants
Section 4.01. Payment of Securities.
The Company shall pay the principal of and any interest on the Securities of
each series in accordance with the terms of the Securities of such series and
this Indenture.
To the extent enforceable under applicable law, the Company shall pay
interest on overdue principal at the rate borne by the Securities of such
series (unless a different rate is specified as contemplated by Section 2.02
for Securities of such series).
Section 4.02. SEC Reports.
The Company shall file with the Trustee within 15 days after it files them
with the SEC copies of the annual reports and of the information, documents and
other reports (or copies of such portions of any of the foregoing
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as the SEC may by rules and regulations prescribe) which the Company is
required to file with the SEC pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934. The Company also shall comply with the other
provisions of TIA (S)314(a).
Section 4.03. Compliance Certificate.
The Company will, within 120 days after the close of each fiscal year of the
Company, commencing with the first fiscal year following the issuance of
financial Securities of any series under this Indenture, file with the Trustee
a certificate of the principal executive officer, the principal officer or the
principal accounting officer of the Company, covering the period from the date
of issuance of such Securities to the end of the fiscal year in which such
Securities were issued, in the case of the first such certificate, and
covering the preceding fiscal year in the case of each subsequent certificate,
and stating whether or not, to the knowledge of the signer, the Company has
complied with all conditions and covenants on its part contained in this
Indenture, and, if the signer has obtained knowledge of any default by the
Company in the performance, observance or fulfillment of any such condition or
covenant, specifying each such default and the nature thereof. For the purpose
of this Section 4.03, compliance shall be determined without regard to any
grace period or requirement of notice provided pursuant to the terms of this
Indenture. The certificate need not comply with Section 12.05.
Section 4.04. Corporate Existence.
Subject to the provisions of Section 5.01 hereof, the Company will do or
cause to be done all things necessary to preserve and keep in full force and
effect its corporate existence.
Section 4.05. Securities Senior to Junior Subordinated Debt.
(a) The Company covenants that the Securities shall be superior in right of
payment as provided in this Section to all Junior Subordinated Debt. Junior
Subordinated Debt means the principal of and interest on Debt of the Company
hereafter created or incurred which by its terms is subordinate in right of
payment to the Securities. "Debt" has the meaning specified in Section 10.01.
(b) Upon the happening of any default in the payment of the principal of or
interest on the Securities of any series when the same becomes due and
payable, then, unless and until such default shall have been cured or waived
or shall have ceased to exist, no payment shall be made by the Company with
respect to the principal of or interest on any Junior Subordinated Debt or to
acquire any instruments evidencing any issue of Junior Subordinated Debt or on
account of any sinking fund provisions of any Junior Subordinated Debt (except
payments made in capital stock of the Company or in warrants, rights or
options to purchase or acquire capital stock of the Company, sinking fund
payments made in instruments evidencing Junior Subordinated Debt of the same
issue acquired before such default and notice thereof, and payments made
through the exchange of other debt obligations of the Company for such Junior
Subordinated Debt in accordance with the terms of such Junior Subordinated
Debt provided that such debt obligations are subordinated to the Securities at
least to the extent that the Junior Subordinated Debt for which they are
exchanged is so subordinated in accordance with this Section 4.05).
(c) Upon the maturity of the Securities of any series by lapse of time,
acceleration or otherwise, all principal thereof and interest thereon shall
first be paid in full, or such payment duly provided for in a manner
satisfactory to the Trustee of the Securities of that series, before any
payment is made on account of the principal of or interest on any Junior
Subordinated Debt or to acquire any instruments evidencing any issue of Junior
Subordinated Debt or on account of any sinking fund provisions of any Junior
Subordinated Debt (except payments made in capital stock of the Company or in
warrants, rights or options to purchase or acquire capital stock of the
Company, sinking fund payments made in instruments evidencing Junior
Subordinated Debt of the same issue acquired before the maturity of the
Securities of such series, and payments made through the exchange of other
debt obligations of the Company for such Junior Subordinated Debt in
accordance with the
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terms of such Junior Subordinated Debt provided that such debt obligations are
subordinated to the Securities at least to the extent that the Junior
Subordinated Debt for which they are exchanged is so subordinated in accordance
with this Section 4.05).
(d) Upon any distribution of assets of the Company in any dissolution,
winding up, liquidation or reorganization of the Company (whether in
bankruptcy, insolvency or receivership proceedings or upon an assignment for
the benefit of creditors or otherwise), the Holders of the Securities shall be
entitled to receive payment in full of the principal thereof and interest due
thereon before the holders of any Junior Subordinated Debt are entitled to
receive any payment on account of the principal of or interest on such Junior
Subordinated Debt.
Section 4.06. Limitation on Subordinated Debt Senior to the Securities.
The Company will not create or incur any Debt which is subordinate or junior
in right of payment to any Senior Debt, as defined in Section 10.01, if such
Debt is superior in right of payment to the Securities.
ARTICLE FIVE
Successor Corporation
Section 5.01. When Company May Merge, etc.
The Company shall not consolidate with or merge into, or transfer its
properties and assets substantially as an entirety to, another corporation
unless (1) the successor corporation, which shall be a corporation organized
and existing under the laws of the United States or a State thereof, assumes by
supplemental indenture all the obligations of the Company under the Securities
and this Indenture; and (2) immediately after giving effect to such
transaction, no Default of Event of Default shall have occurred and be
continuing. Thereafter, unless otherwise specified as contemplated by Section
2.02 for the Securities of any series, all such obligations of the predecessor
corporation shall terminate.
ARTICLE SIX
Defaults and Remedies
Section 6.01. Events of Default.
An "Event of Default" with respect to Securities of any series means each one
of the events specified below in this Section 6.01, unless it is either
inapplicable to a particular series or is specifically deleted or modified as
contemplated by Section 2.02 for the Securities of such series, and any other
events as may be specified as contemplated by Section 2.02 for the Securities
of such series:
(1) the Company defaults in the payment of any interest on any Security
of that series when the same becomes due and payable and the default
continues for a period of 30 days;
(2) the Company defaults in the payment of the principal of any Security
of that series when the same becomes due and payable at maturity, upon
redemption (including default in the making of any mandatory sinking fund
payment), upon purchase by the Company at the option of the Holder pursuant
to the terms of such Security or otherwise;
(3) the Company fails to comply with any of its other agreements in
Securities of that series or this Indenture (other than an agreement which
has expressly been included in this Indenture solely for the benefit of
Securities of any series other than that series or is expressly made
inapplicable to the Securities of such series as contemplated by Section
2.02) and the default continues for the period and after the notice
specified below;
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(4) the Company pursuant to or within the meaning of any Bankruptcy Law;
(A) commences a voluntary case or consents to the commencement of a
case against it,
(B) consents to the entry of an order for relief against it in an
involuntary case,
(C) consents to the appointment of a Custodian of it or for all or
substantially all of its property, or
(D) makes a general assignment for the benefit of its creditors;
(5) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(A) is for relief against the Company in an involuntary case or
adjudicates the Company insolvent or bankrupt,
(B) appoints a Custodian of the Company or for all or substantially
all of its property, or
(C) orders the winding up or liquidation of the Company,
and the order or decree remains unstayed and in effect for 90 days; or
(6) any other Event of Default provided with respect to Securities of
that series occurs.
The term "Bankruptcy Law" means Title 11, U.S. Code or any similar Federal
or State law for the relief of debtors. The term "Custodian" means any
receiver, trustee, assignee, liquidator or similar official under any
Bankruptcy Law.
A Default under clause (3) is not an Event of Default until the Trustee
notifies the Company or the Holders of at least 25% in aggregate principal
amount of the outstanding Securities of that series notify the Company and the
Trustee of the Default and the Company does not cure the Default within 30
days after receipt of the notice. The notice must specify the Default, demand
that it be remedied and state that the notice is a "Notice of Default."
Section 6.02. Acceleration.
If an Event of Default (other than an Event of Default specified in Section
6.01(4) or (5)) occurs and is continuing with respect to Securities of any
series at the time outstanding, the Trustee by notice to the Company, or the
Holders of at least 25% in aggregate principal amount of the outstanding
Securities of that series by notice to the Company and the Trustee, may
declare to be due and payable immediately (1) the principal amount (or, if the
Securities of that series are Original Issue Discount Securities, such portion
of the principal amount as may be specified in the terms of the Securities of
that series) of all of the Securities of that series then outstanding and (2)
interest, if any, accrued to the date of acceleration. Upon such declaration,
such principal amount (or specified amount) and interest, if any, shall be due
and payable immediately. If an Event of Default specified in Section 6.01(4)
or (5) occurs and is continuing, (1) the principal amount (or, if the
Securities of that series are Original Issue Discount Securities, such portion
of the principal amount as may be specified in the terms of the Securities of
that series) of all of the Securities of that series then outstanding and (2)
interest, if any, accrued to the date of such acceleration shall become and be
immediately due and payable without any declaration or other act on the part
of the Trustee or Securityholders. The Holders of a majority in aggregate
principal amount of the outstanding Securities of the series with respect to
which an acceleration applies by notice to the Trustee may rescind an
acceleration and its consequences with respect to such series if all existing
Events of Default (other than the non-payment of the principal of and accrued
interest if any, on Securities that have become due solely by such
acceleration) with respect to Securities of that series have been cured or
waived and if the rescission would not conflict with any judgment or decree.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
Section 6.03. Other Remedies.
If an Event of Default with respect to Securities of any series occurs and
is continuing, the Trustee may pursue any available remedy by proceeding at
law or in equity to collect the payment of the whole amount which then shall
have become due and remain unpaid for principal or interest, if any, on the
Securities of that series or to enforce the performance of any provision of
the Securities of that series or this Indenture.
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The Trustee may maintain a proceeding even if it does not possess any of the
Securities of that series or does not produce any of them in the proceeding. A
delay or omission by the Trustee or any Securityholder in exercising any right
or remedy accruing upon an Event of Default shall not impair the right or
remedy or constitute a waiver of or acquiescence in the Event of Default. No
remedy is exclusive of any other remedy. All available remedies are cumulative.
Section 6.04. Waiver of Existing Defaults.
Subject to Section 9.02, the Holders of a majority in aggregate principal
amount of the outstanding Securities of any series by notice to the Trustee may
waive on behalf of the Holders of all the Securities of such series an existing
Default or Event of Default and its consequences. When a Default or Event of
Default is waived, it is cured and stops continuing.
Section 6.05. Control by Majority.
The Holders of a majority in aggregate principal amount of the outstanding
Securities of any series may direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee or exercising any trust
or power conferred on it, with respect to the Securities of such series. The
Trustee, however, may refuse to follow any direction that conflicts with law or
this Indenture, that is unduly prejudicial to the rights of another
Securityholder or that would involve the Trustee in personal liability.
Section 6.06. Limitation on Suits.
No holder of any Security of any series shall have the right to pursue
any remedy with respect to this Indenture or the Securities unless:
(1) the Holder gives to the Trustee written notice of a continuing Event
of Default with respect to the Securities of that series;
(2) the Holders of at least 25% in aggregate principal amount of the
outstanding Securities of that series make a written request to the Trustee
to pursue the remedy;
(3) such Holder or Holders offer and provide to the Trustee indemnity
satisfactory to the Trustee against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer of indemnity; and
(5) no direction inconsistent with such written request has been given to
the Trustee during such 60-day period by the Holders of a majority in
aggregate principal amount of the outstanding Securities of such series.
A Securityholder of any series may not use this Indenture to prejudice the
rights of another Securityholder of such series or to obtain a preference or
priority over another Securityholder of such series, except in the manner
herein provided and for the equal and ratable benefit of all Securityholders of
such series.
Section 6.07. Rights of Holders to Receive Payment and to Convert.
Subject to Article Ten and notwithstanding any other provision of this
Indenture, the right of any Holder of a Security to receive payment of
principal of and (subject to Section 2.13) interest, if any, on the Security,
on or after the respective due dates with respect to such payments expressed in
such Security, and, if applicable, to convert such Security on the terms and
subject to the conditions applicable to Securities of such series, or to bring
suit for the enforcement of any such payment on or after such respective dates
or of such right to convert, if any, shall not be impaired or affected without
the consent of the Holder.
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Section 6.08. Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(1) or (2) occurs and is
continuing with respect to the Securities of any series, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Company for the whole amount which then shall have become due and remain unpaid
for principal and interest, if any, on the Securities of such series.
Section 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or documents as
may be necessary or advisable in order to have the claims of the Trustee and
the Securityholders allowed in any judicial proceeding relative to the Company,
its creditors or its property and to collect and receive money, property or
securities payable or deliverable on any such claims and to distribute the
same.
Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article, it shall pay out
the money in the following order:
First: to the Trustee for amounts due under Section 7.07;
Second: to holders of Senior Debt to the extent required by Article Ten;
Third: to the payment of amounts due and unpaid for principal and
interest, if any, on the Securities in respect of which such money has been
collected, ratably, without preference or priority of any kind, according
to the amounts which then shall have become due and payable on such
Securities for principal and interest, respectively; and
Fourth: to the Company.
The Trustee may fix a record date and payment date for any payment to
Securityholders pursuant to this Section, notice of which shall be mailed to
each Securityholder by the Company at least 15 days before such record date.
Section 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this Indenture
or in any suit against the Trustee for any action taken or omitted by it as
Trustee, a court in its discretion may require the filing by any party litigant
in the suit of an undertaking to pay the costs of the suit, and the court in
its discretion may assess reasonable costs, including reasonable attorneys'
fees, against any party litigant in the suit, having due regard to the merits
and good faith of the claims or defenses made by the party litigant. This
Section does not apply to a suit by the Trustee, a suit by a Holder pursuant to
Section 6.07 or a suit by Holders of more than 10% in aggregate principal
amount of the outstanding Securities of any series.
ARTICLE SEVEN
Trustee
Section 7.01. Duties of Trustee.
(a) If an Event of Default with respect to Securities of any series has
occurred and is continuing, the Trustee shall with respect to such series
exercise such of the rights and powers vested in it by this Indenture with
respect to such series and use the same degree of care and skill in their
exercise as a prudent man would exercise or use under the circumstances in the
conduct of his own affairs.
(b) With respect to Securities of any series, except during the continuance
of an Event of Default with respect to Securities of such series:
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(1) The Trustee need perform only those duties that are specifically set
forth in this Indenture or the TIA and no others.
(2) In the absence of bad faith on its part, the Trustee may conclusively
rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon certificates or opinions furnished to the Trustee
and conforming to the requirements of this Indenture. The Trustee, however,
shall examine the certificates and opinions to determine whether or not
they conform to the requirements of this Indenture.
(c) The Trustee may not be relieved from liability for its own negligent
action, its own negligent failure to act or its own willful misconduct, except
that:
(1) This paragraph does not limit the effect of paragraph (b) of this
Section.
(2) The Trustee shall not be liable for any error of judgment made in
good faith by a Trust Officer, unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts.
(3) The Trustee shall not be liable with respect to any action it takes
or omits to take in good faith in accordance with a direction received by
it pursuant to Section 6.05.
(d) Every provision of this Indenture that in any way relates to the Trustee
is subject to paragraphs (a), (b) and (c) of this Section.
(e) No provision of this Indenture shall require the Trustee to expend or
risk its own funds or incur any liability. The Trustee may refuse to perform
any duty or exercise any right or power unless it receives indemnity
satisfactory to it against any loss, liability or expense.
(f) The Trustee shall not be liable for interest on any money received by it
except as the Trustee may agree with the Company. Money held in trust by the
Trustee need not be segregated from other funds except to the extent required
by law.
Section 7.02. Rights of Trustee.
(a) The Trustee may rely on any document believed by it to be genuine and to
have been signed or presented by the proper person. The Trustee need not
investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may consult with
counsel or require an Officers' Certificate, an Opinion of Counsel, and/or an
accountant's certificate. The Trustee shall not be liable for any action it
takes or omits to take in good faith in reliance on the Certificate, Opinion or
accountant's certificate.
(c) The Trustee may act through agents and counsel and shall not be
responsible for the misconduct or negligence of any agent or counsel appointed
with due care.
(d) The Trustee shall not be liable for any action it takes or omits to take
in good faith which it believes to be authorized or within its rights or
powers.
Section 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the owner or
pledgee of Securities and may otherwise deal with the Company or its Affiliates
with the same rights it would have if it were not Trustee. Any Agent may do the
same with like rights. The Trustee, however, must comply with Sections 7.10 and
7.11.
Section 7.04. Trustee's Disclaimer.
The Trustee makes no representation as to the validity or adequacy of this
Indenture or the Securities; it shall not be accountable for the Company's use
of the proceeds from the Securities; and it shall not be responsible for any
statement in the Indenture or the Securities other than its certificate of
authentication.
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Section 7.05. Notice of Defaults.
If a Default occurs and is continuing with respect to Securities of any
series and if it is known to a Trust Officer of the Trustee, the Trustee shall
mail to each Securityholder of such series notice of the Default within 90 days
after it occurs or as soon as reasonably practicable thereafter. Except in the
case of a default in payment of principal of or interest on any Security of
such series (including default in the making of any mandatory sinking fund or
mandatory repurchase payment), the Trustee may withhold the notice if and so
long as a committee of its Trust Officers in good faith determines that
withholding the notice is in the interests of Securityholders of such series.
Section 7.06. Reports by Trustee to Holders.
Within 60 days after each May 15 beginning with the May 15 following the date
on which Securities are originally issued after this Indenture, the Trustee
shall mail to each Securityholder a brief report dated as of such May 15 that
complies with TIA (S)313(a) if required by said Section. The Trustee also shall
comply with TIA (S)313(b).
A copy of each report at the time of its mailing to Securityholders shall be
filed by the Company with the SEC and each stock exchange on which the
Securities are listed.
The Company will notify the Trustee if and when the Securities are listed on
any stock exchange.
Section 7.07. Compensation and Indemnity.
The Company shall pay to the Trustee from time to time reasonable
compensation for its services. The Trustee's compensation shall not be limited
by any law on compensation of a trustee of an express trust. The Company shall
reimburse the Trustee upon request for all reasonable out-of-pocket expenses
incurred by it. Such expenses shall include the reasonable compensation and
expenses of the Trustee's agents and counsel.
The Company shall indemnify the Trustee against any loss or liability
incurred by it arising out of or in connection with the acceptance or
administration of this trust and its duties hereunder. The Trustee shall notify
the Company promptly of any claim asserted against the Trustee for which it may
seek indemnity. Failure of the Trustee to so notify the Company shall not
relieve the Company of its obligations hereunder. The Company shall have the
right to elect to defend the claim and the Trustee shall cooperate in the
defense. The Trustee may have separate counsel and the Company shall pay the
reasonable fees and expenses of such counsel. The Company need not pay for any
settlement made without its written consent. The Company need not reimburse any
expense or indemnify against any loss or liability incurred by the Trustee
through negligence or bad faith.
To secure the Company's payment obligations in this Section, the Trustee
shall have a lien prior to the Securities on all money or property held or
collected by the Trustee, except that held in trust to pay principal of or
interest on particular Securities.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(4) or (5) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
Section 7.08. Replacement of Trustee.
The Trustee may resign at any time with respect to Securities of one or more
series by so notifying the Company. The Holders of a majority in aggregate
principal amount of the outstanding Securities of any series may remove the
Trustee with respect to the Securities of such series by so notifying the
Company. The Holders of a majority in aggregate principal amount of the
outstanding Securities of any series may remove the Trustee with respect to the
Securities of such series by so notifying the removed Trustee and may appoint a
successor Trustee with the Company's consent. The Company shall remove the
Trustee if:
(1) the Trustee fails to comply with Section 7.10;
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(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a receiver or other public officer takes charge of the Trustee or its
property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed, or if a vacancy exists in the office of
Trustee for any reason, with respect to the Securities of one or more series,
the Company shall promptly appoint a successor Trustee or Trustees (it being
understood that any such successor Trustee may be appointed with respect to the
Securities of one or more or all of such series and that at any time there
shall be only one Trustee with respect to the Securities of any particular
series).
A successor Trustee shall deliver a written acceptance of its appointment to
the retiring Trustee and to the Company. Immediately after that, the retiring
Trustee shall transfer all property held by it as Trustee to the successor
Trustee (subject to its lien, if any, provided for in Section 7.07), the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. A successor Trustee shall mail notice of its succession
to each Securityholder.
If a successor Trustee with respect to Securities of any series does not take
office within 60 days after the retiring Trustee resigns or is removed, the
retiring Trustee, the Company or the Holders of a majority in aggregate
principal amount of the outstanding Securities of such series may petition any
court of competent jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder may
petition any court of competent jurisdiction for the removal of the Trustee
with respect to all Securities and the appointment of a successor Trustee.
Section 7.09. Successor Trustee by Merger, etc.
If the Trustee consolidates with, merges or converts into, or transfers all
or substantially all of its corporate trust assets to, another corporation or
national banking association, the successor corporation or national banking
association without any further act shall be the successor Trustee.
Section 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the requirements of
TIA (S)310(a). The Trustee shall always have a combined capital and surplus of
at least $50,000,000 as set forth in its most recent published annual report of
condition. With respect to the Securities of each series, the Trustee shall
comply with TIA (S)310(b) and in determining whether the Trustee has a
conflicting interest as defined in TIA (S)310(b) with respect to the Securities
of any series, there shall be excluded this Indenture with respect to the
Securities of any series other than such series. Nothing herein shall prevent
the Trustee from filing with the SEC the application referred to in the second
to last paragraph of TIA (S)310(b).
Section 7.11. Preferential Collection of Claims Against Company.
The Trustee shall comply with TIA (S)311(a), excluding any creditor
relationship listed in TIA (S)311(b). A Trustee who has resigned or been
removed shall be subject to TIA (S)311(a) to the extent indicated.
ARTICLE EIGHT
Discharge of Indenture
Section 8.01. Termination of Company's Obligations.
The Company may terminate all of its obligations under the Securities of any
series and this Indenture with respect to the Securities of such series if
either (1) all Securities of such series previously authenticated and
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delivered (other than destroyed, lost or stolen Securities which have been
replaced or paid or Securities for whose payment money (or, if permitted by the
terms of such Securities, securities) has theretofore been held in trust and
thereafter repaid to the Company, as provided in Section 8.03) have been
delivered to the Trustee for cancellation; or (2) the Company irrevocably
deposits in trust with the Trustee money or U.S. Government Obligations
sufficient to pay the principal of and interest, if any, on all Securities of
such series not theretofore cancelled or delivered to the Trustee for
cancellation (other than destroyed, lost or stolen Securities which have been
replaced or paid or Securities for whose payment money (or, if permitted by the
terms of such Securities, securities) has theretofore been held in trust and
thereafter repaid to the Company, as provided in Section 8.03) to maturity or
redemption, as the case may be.
The Company's obligations in Sections 2.05, 2.06, 2.07, 2.08, 20.9, 4.01,
7.07, 7.08 and 8.03 and Article Eleven of this Indenture, however, shall
survive until the Securities of such series are no longer outstanding.
Thereafter the Company's obligations in Sections 7.07 and 8.03 shall survive.
Notwithstanding the satisfaction and discharge of this Indenture with respect
to the Securities of any series, if money or U.S. Government Obligations shall
have been deposited with the Trustee pursuant to clause (2) of this Section,
the obligations of the Trustee under Section 8.02 and the second sentence of
Section 8.03 shall survive.
After a deposit and if all other conditions thereto are met, the Trustee for
the Securities of such series shall be required to execute an instrument
acknowledging satisfaction and discharge of this Indenture with respect to such
Securities, except for those surviving obligations specified above; provided,
however, that the Trustee shall not be required to execute such instrument
until the expiration of ninety days after the date of a deposit and that such
instrument may be made subject to the condition that such deposit had been made
prior to the happening of any event specified in Section 10.02.
In order to have money available on a payment date to pay the principal of or
interest, if any, on the Securities, the U.S. Government Obligations shall be
payable as to principal or interest on or before such payment date in such
amounts as well provide the necessary money. U.S. Government Obligations shall
not be callable at the issuer's option.
Section 8.02. Application of Trust Fund.
The Trustee shall hold in trust money and U.S. Government Obligations
deposited with it pursuant to Section 8.01. Subject to Section 10.07, it shall
apply the deposited money and the money from the U.S. Government Obligations
through the Paying Agent and in accordance with the provisions of the
Securities and this Indenture to the payment of principal of and interest, if
any, on the Securities for the payment of which such money or U.S. Government
Obligations has been deposited with the Trustee.
Section 8.03. Repayment to Company.
The Trustee and the Paying Agent shall promptly pay to the Company upon
written request any excess money or securities held by them at any time. The
Trustee and the Paying Agent shall pay to the Company upon written request any
money or securities held by them for the payment of principal or interest, if
any, that remains unclaimed for two years. After that, Holders entitled to the
money or securities must look to the Company for payment unless an applicable
abandoned property law designates another person.
ARTICLE NINE
Amendments, Supplements and Waivers
Section 9.01. Without Consent of Holders.
The Company and the Trustee may amend or supplement this Indenture or the
Securities of any series without notice to or consent of any Securityholder:
(1) to cure any ambiguity, defect or inconsistency;
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(2) to comply with Section 5.01 and 11.16;
(3) to establish the form or terms of Securities of any series as
permitted by Sections 2.01 and 2.02;
(4) to add to the covenants of the Company for the benefit of the Holders
of all or any series of Securities (and if such covenants are to be for the
benefit of less than all series of Securities, stating that such covenants
are expressly being included solely for the benefit of such series) or to
surrender any right or power herein conferred upon the Company;
(5) to add any additional Events of Default (and if such Events of
Default are to be applicable to less than all series of Securities, stating
that such Events of Default are expressly being included solely to be
applicable to such series);
(6) to change or eliminate any of the provisions of this Indenture,
provided that, except as otherwise contemplated by Section 2.02(13), any
such change or elimination shall become effective only when there is no
Security outstanding of any series created prior thereto which is entitled
to the benefit of such provision;
(7) to add or change any of the provisions of this Indenture to such
extent as shall be necessary to permit or facilitate the issuance of
Securities in bearer form, registrable or not registrable as to principal,
and with or without interest coupons, or to provide for uncertificated
Securities in addition to certificated Securities (so long as any
"registration-required obligation" within the meaning of Section 163(f)(2)
of the Internal Revenue Code of 1986, as amended (the "Code") is in
registered form for purposes of the Code);
(8) to make any change that, in the opinion of the Board of Directors,
does not materially adversely affect the rights of any Securityholder; or
(9) to comply with any requirement of the SEC in connection with the
qualification of this Indenture under the TIA.
Section 9.02. With Consent of Holders.
The Company and the Trustee may amend or supplement this Indenture or the
Securities of any series without notice to any Securityholder but with the
written consent of the Holders of a majority in aggregate principal amount of
the outstanding Securities of each series affected by such amendment or
supplement. The Holders of a majority in aggregate principal amount of the
outstanding Securities of any series may on behalf of the Holders of all
Securities of such series waive compliance by the Company with any provision of
this Indenture or of Securities of such series without notice to any
Securityholder. Without the consent of each Securityholder affected, however,
an amendment, supplement or waiver, including a waiver pursuant to Section
6.04, may not:
(1) reduce the amount of Securities of any series whose Holders must
consent to an amendment, supplement or waiver;
(2) reduce the rate of or extend the time for payment of interest on any
Security (or, in the case of an Original Issue Discount Security, reduce
the rate of accrual of original issue discount);
(3) reduce the principal of (or any premium payable upon the redemption
of) or extend the fixed maturity of any Security (or, in the case of an
Original Issue Discount Security, reduce the portion of the principal
amount that would be due and payable upon acceleration of the maturity
thereof pursuant to Section 6.02);
(4) change the amount or time of any payment required by any sinking fund
provisions of the Securities of any series;
(5) make any change that materially adversely affects the rights of a
Holder to require the Company to purchase a Security in accordance with the
terms thereof and this Indenture;
(6) waive a default in the payment of the principal of or interest, if
any, on any Security;
(7) make any Security payable in money or securities other than that
stated in the Security; or
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(8) make any change that materially adversely affects the right to
convert any Security or that increases the conversion price or reduces the
conversion rate of any Security.
It shall not be necessary for the consent of the Holders under this Section
to approve the particular form of any proposed supplement, but it shall be
sufficient if such consent approves the substance thereof.
Section 9.03. Compliance with Trust Indenture Act.
Every amendment to or supplement of this Indenture or the Securities shall
comply with the TIA as then in effect.
Section 9.04. Revocation and Effect of Consents.
A consent to an amendment, supplement, waiver or other action by a Holder of
a Security shall bind the Holder and every subsequent Holder of a Security or
portion of a Security that evidences the same debt as the consenting Holder's
Security, even if notation of the consent is not made on any Security. Any such
Holder or subsequent Holder, however, may revoke the consent as to his Security
or portion of a Security. Such revocation shall be effective only if the
Trustee receives the notice of revocation before the date the amendment,
supplement, waiver or other action becomes effective. An amendment, supplement,
waiver or other action shall become effective on receipt by the Trustee of
written consents from the Holders of the requisite percentage in aggregate
principal amount of the outstanding Securities of the relevant series. After an
amendment, supplement or waiver becomes effective, it shall bind every
Securityholder of each series of Securities so affected.
Section 9.05. Notation on or Exchange of Securities.
If an amendment, supplement or waiver changes the terms of a Security, the
Trustee may require the Holder of the Security to deliver it to the Trustee.
The Trustee may place an appropriate notation on the Security about the changed
terms and return it to the Holder. Alternatively, if the Company or the Trustee
so determines, the Company in exchange for the Security shall issue and the
Trustee shall authenticate a new Security that reflects the changed terms.
Section 9.06. Trustee to Sign Amendments, etc.
The Trustee shall sign any amendment, supplement or waiver authorized
pursuant to this Article if the amendment, supplement or waiver does not
adversely affect the rights, duties, immunities or liabilities of the Trustee.
If it does, the Trustee may but need not sign it. The Company may not sign an
amendment or supplement until the Board of Directors approves it.
ARTICLE TEN
Subordination
Section 10.01. Securities Subordinated to Senior Debt.
The Company agrees, and each holder of the Securities by his acceptance
thereof likewise agrees, that the payment of the principal of and interest, if
any, on the Securities is subordinated, to the extent and in the manner
provided in this Article, to the prior payment in full of all Senior Debt.
Senior Debt means the principal of and interest on Debt of the Company
outstanding at any time other than (i) the Securities, (ii) the Company's
outstanding 11 1/8% senior subordinated debentures due October 1, 2003, which
shall rank pari passu with the Securities, and (iii) Debt which by its terms is
not superior in right of payment to the Securities. "Debt" of any person means:
(1) any indebtedness of such person (i) for borrowed money or (ii)
evidenced by a note, debenture or similar instrument (including a purchase
money obligation) given in connection with the acquisition of any property
or assets, including securities;
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(2) any guarantee by such person of any indebtedness of others described
in the preceding clause (1); and
(3) any amendment, renewal, extension or refunding of any such
indebtedness or guarantee.
This Article shall constitute a continuing offer to all persons who, in
reliance upon such provisions, become holders of, or continue to hold, Senior
Debt, and such provisions are made for the benefit of the holders of Senior
Debt, and such holders are made obligees hereunder and they and/or each of them
may enforce such provisions.
Section 10.02. Company Not to Make Payments with Respect to Securities in
Certain Circumstances.
(a) Upon the maturity of any Senior Debt by lapse of time, acceleration or
otherwise, all principal thereof and interest thereon shall first be paid in
full, or such payment duly provided for in cash or in a manner satisfactory to
the holders of such Senior Debt, before any payment is made on account of the
principal of or
interest on the Securities or to acquire any of the Securities or on account of
any sinking fund provisions of the Securities (except payments made in capital
stock of the Company or in warrants, rights or options to purchase or acquire
capital stock of the Company, sinking fund payments made in Securities acquired
by the Company before the maturity of such Senior Debt, and payments made
through the exchange of other debt obligations of the Company for such
Securities in accordance with the terms of such Securities, provided that such
debt obligations are subordinated to Senior Debt at least to the extent that
the Securities for which they are exchanged are so subordinated pursuant to
this Article Ten).
(b) Upon the happening of any default in payment of the principal of or
interest on any Senior Debt when the same becomes due and payable, then, unless
and until such default shall have been cured or waived or shall have ceased to
exist, no payment shall be made by the Company with respect to the principal of
or interest on the Securities or to acquire any of the Securities or on account
of any sinking fund provisions of the Securities (except payments made in
capital stock of the Company or in warrants, rights or options to purchase or
acquire capital stock of the Company, sinking fund payments made in Securities
acquired by the Company before such default and notice thereof, and payments
made through the exchange of other debt obligations of the Company for such
Securities in accordance with the terms of such Securities, provided that such
debt obligations are subordinated to Senior Debt at least to the extent that
the Securities for which they are exchanged are so subordinated pursuant to
this Article Ten).
(c) In the event that notwithstanding the provisions of this Section 10.02
the Company shall make any payment to the Trustee on account of the principal
of or interest on the Securities, or on account of any sinking fund provisions
of the Securities, after the maturity of any Senior Debt as described in
Section 10.02(a) above or after the happening of a default in payment of the
principal of or interest on any Senior Debt as described in Section 10.02(b)
above, then, unless and until all Senior Debt which shall have matured, and all
interest thereon, shall have been paid in full (or the declaration of
acceleration thereof shall have been rescinded or annulled), or such default
shall have been cured or waived or shall have ceased to exist, such payment
(subject to the provisions of Sections 10.06 and 10.07) shall be held by the
Trustee, in trust for the benefit of, and shall be paid forthwith over and
delivered to, the holders of such Senior Debt (pro rata as to each of such
holders on the basis of the respective amounts of Senior Debt held by them) or
their representative or the trustee under the indenture or other agreement (if
any) pursuant to which such Senior Debt may have been issued, as their
respective interests may appear, for application to the payment of all such
Senior Debt remaining unpaid to the extent necessary to pay the same in full in
accordance with its terms, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Debt. The Company shall give
prompt written notice to the Trustee of any default in the payment of principal
of or interest on any Senior Debt.
Section 10.03. Securities Subordinated to Prior Payment of All Senior Debt on
Dissolution, Liquidation or Reorganization of Company.
Upon any distribution of assets of the Company in any dissolution, winding
up, liquidation or reorganization of the Company (whether in bankruptcy,
insolvency or receivership proceedings or upon an assignment for the benefit of
creditors or otherwise):
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(a) the holders of all Senior Debt shall first be entitled to receive
payments in full of the principal thereof and interest due thereon before
the Holders of the Securities are entitled to receive any payment on
account of the principal of or interest on the Securities;
(b) any payment or distribution of assets of the Company of any kind or
character, whether in cash, property or securities (other than securities
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 the payment of which is subordinate, at least to the extent
provided in this Article Ten with respect to the Securities, to the payment
in full without diminution or modification by such plan of all Senior
Debt), to which the Holders of the Securities or the Trustee on behalf of
the Holders of the Securities would be entitled except for the provisions
of this Article Ten, shall be paid by the liquidating trustee or agent or
other person making such payment or distribution directly to the holders of
Senior Debt or their representative, or to the trustee under any indenture
under which Senior Debt may have been issued (pro rata as to each such
holder, representative or trustee on the basis of the respective amounts of
unpaid Senior Debt held or represented by each), to the extent necessary to
make payment in full of all Senior Debt remaining unpaid, after giving
effect to any concurrent payment or distribution or provision therefor to
the holders of such Senior Debt; and
(c) in the event that notwithstanding the foregoing provisions of this
Section 10.03, any payment or distribution of assets of the Company of any
kind or character, whether in cash, property or securities (other than
securities 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 the payment of which is subordinate, at least to the extent
provided in this Article Ten with respect to the Securities, to the payment
in full without diminution or modification by such plan of all Senior
Debt), shall be received by the Trustee or the Holders of the Securities on
account of principal of or interest on the Securities before all Senior
Debt is paid in full, or effective provision made for its payment, such
payment or distribution (subject to the provisions of Sections 10.06 and
10.07) shall be received and held in trust for and shall be paid over to
the holders of the Senior Debt remaining unpaid or unprovided for or their
representative, or to the trustee under any indenture under which such
Senior Debt may have been issued (pro rata as provided in subsection (b)
above), for application to the payment of such Senior Debt until all such
Senior Debt shall have been paid in full, after giving effect to any
concurrent payment or distribution or provision therefor to the holders of
such Senior Debt.
The Company shall give prompt written notice to the Trustee of any
dissolution, winding up, liquidation or reorganization of the Company.
Section 10.04. Securityholders to be Subrogated to Right of Holders of Senior
Debt.
Subject to the payment in full of all Senior Debt, the Holders of the
Securities shall be subrogated equally and ratably to the rights of the holders
of Senior Debt to receive payments or distributions of assets of the Company
applicable to the Senior Debt until all amounts owing on the Securities shall
be paid in full, and for the purpose of such subrogation no payments or
distributions to the holders of the Senior Debt by or on behalf of the Company
or by or on behalf of the Holders of the Securities by virtue of this Article
Ten which otherwise would have been made to the Holders of the Securities
shall, as between the Company, its creditors other than holders of Senior Debt
and the Holders of the Securities, be deemed to be payment by the Company to or
on account of the Senior Debt, it being understood that the provisions of this
Article Ten are and are intended solely for the purpose of defining the
relative rights of the Holders of the Securities, on the one hand, and the
holders of the Senior Debt, on the other hand.
Section 10.05. Obligation of the Company Unconditional.
Nothing contained in this Article Ten or elsewhere in this Indenture or in
any Security is intended to or shall impair, as between the Company, its
creditors other than holders of Senior Debt and the Holders of the Securities,
the obligation of the Company, which is absolute and unconditional, to pay to
the holders of the
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Securities the principal of and interest on the Securities as and when the same
shall become due and payable in accordance with their terms, or is intended to
or shall affect the relative rights of the Holders of the Securities and
creditors of the Company other than the holders of the Senior Debt, nor shall
anything herein or therein prevent the Trustee or the Holder of any Security
from exercising all remedies otherwise permitted by applicable law upon default
under this Indenture, subject to the rights, if any, under this Article Ten of
the holders of Senior Debt in respect of cash, property or securities of the
Company received upon the exercise of any such remedy. Upon any payment or
distribution of assets of the Company referred to in this Article Ten, the
Trustee and the Holders of the Securities shall be entitled to rely upon any
order or decree made by any court of competent jurisdiction in which such
dissolution, winding up, liquidation or reorganization proceedings are pending,
or, subject to the provisions of Sections 7.01 and 7.02, a certificate of the
receiver, trustee in bankruptcy, liquidating trustee or agent or other person
making such payment or distribution to the Trustee or the Holders of the
Securities, for the purpose of ascertaining the persons entitled to participate
in such 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
Ten.
Nothing contained in this Article Ten or elsewhere in this Indenture or in
any Security is intended to or shall affect the obligation of the Company to
make, or prevent the Company from making, at any time except during the
pendency of any dissolution, winding up, liquidation or reorganization
proceeding, and except as provided in subsections (a) and (b) of Section 10.02,
payments at any time of the principal of or interest on the Securities.
Section 10.06. Trustee Entitled to Assume Payments Not Prohibited in Absence of
Notice.
The Trustee shall not at any time be charged with knowledge of the existence
of any facts which would prohibit the making of any payment to or by the
Trustee, unless at least one Business Day prior to the making of any such
payment, the Trustee shall have received written notice thereof from the
Company or from one or more holders of Senior Debt or from any representative
thereof or from any trustee therefor, together with proof satisfactory to the
Trustee of such holding of Senior Debt or of the authority of such
representative or trustee; and, prior to the receipt of any such written
notice, the Trustee, subject to the provisions of Sections 7.01 and 7.02, shall
be entitled to assume conclusively that no such facts exist. The Trustee shall
be entitled to rely on the delivery to it of a written notice by a person
representing himself to be a holder of Senior Debt (or a representative or
trustee on behalf of such holder) to establish that such notice has been given
by a holder of Senior Debt or a representative of or trustee on behalf of any
such holder. In the event that the Trustee determines, in good faith, that
further evidence is required with respect to the right of any person as a
holder of Senior Debt to participate in any payments or distribution pursuant
to this Article Ten, the Trustee may request such person to furnish evidence to
the reasonable satisfaction of the Trustee as to the amount of Senior Debt held
by such person, as to the extent to which such person is entitled to
participate in such payment or distribution, and as to other facts pertinent to
the rights of such person under this Article Ten, and if such evidence is not
furnished, the Trustee may defer any payment to such person pending judicial
determination as to the right of such person to receive such payment. The
Trustee, however, shall not be deemed to owe any fiduciary duty to the holders
of Senior Debt and nothing in this Article Ten shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 7.07.
Section 10.07. Application by Trustee of Monies or U.S. Government Obligations
Deposited with It.
Money or U.S. Government Obligations deposited in trust with the Trustee
pursuant to and in accordance with Section 8.01 shall be for the sole benefit
of Securityholders and, to the extent allocated for the payment of Securities,
shall not be subject to the subordination provisions of this Article Ten, if
the same are deposited in trust prior to the happening of any event specified
in Section 10.02. Otherwise, any deposit of monies or U.S. Government
Obligations by the Company with the Trustee or any Paying Agent (whether or not
in trust) for the payment of the principal of or interest on any Securities
shall be subject to the provisions of Sections 10.01, 10.02 and 10.03 except
that, if prior to the date on which by the terms of this Indenture any such
monies may become payable for any purpose (including, without limitation, the
payment of the principal of or the interest, if
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any, on any Security) the Trustee shall not have received with respect to such
monies the notice provided for in Section 10.06, then the Trustee or the Paying
Agent shall have full power and authority to receive such monies and U.S.
Government Obligations and to apply the same to the purpose for which they were
received, and shall not be affected by any notice to the contrary which may be
received by it on or after such date. This Section 10.07 shall be construed
solely for the benefit of the Trustee and Paying Agent and, as to the first
sentence hereof, the Securityholder, and shall not otherwise affect the rights
of holders of Senior Debt.
Section 10.08. Subordination Rights Not Impaired by Acts or Omissions of
Company or Holders of Senior Debt.
No right of any present or future holders of any Senior Debt to enforce
subordination as provided herein 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 of this Indenture, regardless of any knowledge
thereof which any such holder may have or be otherwise charged with.
Section 10.09. Securityholders Authorize Trustee to Effectuate Subordination of
Securities.
Each Holder of the Securities by his acceptance thereof authorizes and
expressly directs the Trustee on his behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in this
Article Ten and appoints the Trustee his attorney-in-fact for such purpose,
including, in the event of any dissolution, winding up, liquidation or
reorganization of the Company (whether in bankruptcy, insolvency or
receivership proceedings or upon an assignment for the benefit of creditors or
otherwise) tending towards liquidation of the business and assets of the
Company, the immediate filing of a claim for the unpaid balance of his
Securities in the form required in said proceedings and causing said claim to
be approved. If the Trustee does not file a proper claim or proof of debt in
the form required in such proceeding prior to 30 days before the expiration of
the time to file such claim or claims, then the holders of Senior Debt have the
right to file and are hereby authorized to file an appropriate claim for and on
behalf of the Holders of said Securities.
Section 10.10. Right of Trustee to Hold Senior Debt.
The Trustee shall be entitled to all of the rights set forth in this Article
Ten in respect of any Senior Debt at any time held by it to the same extent as
any other holder of Senior Debt, and nothing in this Indenture shall be
construed to deprive the Trustee of any of its rights as such holder.
Section 10.11. Article Ten Not to Prevent Events of Default.
The failure to make a payment on account of principal or interest by reason
of any provision in this Article Ten shall not be construed as preventing the
occurrence of an Event of Default under Section 6.01.
ARTICLE ELEVEN
Conversion
Section 11.01. Applicability of Article.
Securities of any series which are convertible into Parent Stock at the
option of the Holder shall be convertible in accordance with their terms and
(except as otherwise specified as contemplated by Section 2.02 for Securities
of any series) in accordance with this Article. Each reference in this Article
to "a Security" or "the Securities" refers to the Securities of the particular
series that is convertible into Parent Stock. If more than one series of
Securities with conversion privileges are outstanding at any time, the
provisions of this Article shall be applied separately to each such series.
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Section 11.02. Conversion Privilege.
A Holder of a Security of any authorized denomination of any series may
convert it into Parent Stock, at any time during the period specified on the
Securities of that series, at the conversion price or conversion rate in effect
on the conversion date, except that, with respect to any Security (or portion
thereof) called for redemption, such right shall (except as otherwise provided
in Section 3.08) terminate at the close of business on the fifteenth day prior
to the date fixed for redemption of such Security (or portion thereof) (or such
other day as may be specified as contemplated by Section 2.02 for Securities of
such series), unless the Company shall default in payment of the amount due
upon redemption thereof.
The initial conversion price or conversion rate in respect of a series of
Securities shall be as specified on the Securities of that series. The
conversion price or conversion rate will be subject to adjustment on the terms
set forth in Sections 11.07 through 11.13 or such other or different terms, if
any, as may be specified as contemplated by Section 2.02 for Securities of such
series.
A Holder may convert any Security in full and may convert a portion of a
Security if the portion to be converted and the remaining portion of such
Security are in denominations issuable for that series of Securities.
Provisions of this Indenture that apply to conversion of all of a Security also
apply to conversion of a portion of it.
Section 11.03. Conversion Procedure.
To convert a Security of any series, a Holder must satisfy the requirements
for conversion contained on the Securities of that series. The date on which
the Holder satisfies all those requirements is the conversion date. As soon as
practicable after the conversion date, the Company shall deliver to the Holder
through the Conversion Agent a certificate for the number of shares of Parent
Stock deliverable upon the conversion and cash or its check in lieu of any
fractional share. The person in whose name the certificate is registered
becomes a stockholder of record on the conversion date and the rights of the
Holder of the Securities so converted as a Holder thereof cease as of such
date.
If the Holder converts more than one Security of any series at the same time,
the number of full shares issuable upon the conversion shall be based on the
total principal amount of the Securities of such series so converted.
Upon surrender of a Security of any series that is converted in part, the
Trustee shall authenticate for the Holder a new Security of that series equal
in principal amount to the unconverted portion of the Security surrendered.
If the last day on which a Security may be converted is a Legal Holiday in a
place where a Conversion Agent is located, the Security may be surrendered to
that Conversion Agent on the next succeeding day that is not a Legal Holiday.
The Company will not be required to deliver certificates for shares of Parent
Stock upon conversion while the Parent's stock transfer books are closed for a
meeting of stockholders or for the payment of dividends or for any other
purpose, but certificates for shares of Parent Stock shall be delivered as soon
as the stock transfer books shall again be opened.
Securities of any series surrendered for conversion during the period from
the close of business on any Regular Record Date next preceding any Interest
Payment Date for such series to the opening of business on such Interest
Payment Date shall (except in the case of Securities or portions thereof which
have been called for redemption on a redemption date within such period) be
accompanied by payment in funds acceptable to the Company of an amount equal to
the interest payable on such Interest Payment Date on the principal amount of
Securities being surrendered for conversion; provided, that no such payment
need be made if there shall exist, at the time of conversion, a default in the
payment of interest on the Securities of such series. The funds so delivered to
the Conversion Agent shall be paid to the Company on or after such Interest
Payment Date unless
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the Company shall default on the payment of the interest due on such Interest
Payment Date, in which event such funds shall be paid to the Holder who
delivered the same. Except as provided in the preceding sentence and subject to
the last paragraph of Section 2.13, no payment or adjustment shall be made upon
any conversion on account of any interest accrued on the Securities surrendered
for conversion or on account of any dividends on the Parent Stock issued upon
conversion.
Section 11.04. Fractional Shares.
The Company will not deliver a fractional share of Parent Stock upon
conversion of a Security. Instead, the Company will deliver cash or its check
for the current market value of a fractional share. The current market value of
a fractional share is determined as follows: Multiply the current market price
of a full share on the last full trading day prior to the conversion date by
the fraction (rounded to the nearest 1/100 of a share) and round the result to
the nearest whole cent.
Section 11.05. Taxes on Conversion.
If a Holder of a Security converts it, the Company shall pay any documentary,
stamp or similar issue or transfer tax due on the delivery of shares of Parent
Stock upon the conversion. The Holder, however, shall pay any such tax which is
due because the shares are issued in a name other than the Holder's name.
Section 11.06. Company to Provide Stock.
The Company shall (i) cause Parent to, from time to time as may be necessary,
reserve out of Parent's authorized but unissued Parent Stock or Parent Stock
held in treasury enough shares of Parent Stock to permit the conversion of all
outstanding Securities and (ii) secure from Parent (or elsewhere) a sufficient
number of shares of Parent Stock for delivery upon conversions of Securities.
All shares of Parent Stock which may be delivered upon conversion of the
Securities shall be validly issued, fully paid and non-assessable and shall be
free from any preemptive rights.
In order that the Company may deliver shares of Parent Stock upon conversion
of the Securities, the Company will, and will cause Parent to, endeavor to
comply with all applicable Federal and State securities laws and will endeavor
to cause such shares to be listed on each national or regional securities
exchange on which the Parent Stock is listed.
If the taking of any action would cause an adjustment to the then prevailing
conversion price or conversion rate which would result in shares of Parent
Stock being issued upon conversion of the Securities at an effective conversion
price below the then par value, if any, of the Parent Stock, or would raise the
par value above the effective conversion price then in effect, the Company
will, and will cause Parent to, take such corporate action as may, in the
opinion of its counsel, be necessary in order that the Parent may validly and
legally issue, and the Company may deliver, fully paid and non-assessable
shares of Parent Stock at such adjusted conversion price or conversion rate or
the conversion price or conversion rate then in effect, as the case may be.
Section 11.07. Adjustment for Change in Capital Stock.
If the Parent:
(1) pays a dividend or makes a distribution in shares of Parent Stock;
(2) subdivides the outstanding shares of Parent Stock into a greater
number of shares;
(3) combines the outstanding shares of Parent Stock into a smaller number
of shares;
(4) pays a dividend or makes a distribution on the Parent Stock in shares
of its capital stock other than Parent Stock; or
(5) issues by reclassification of its shares of Parent Stock any shares
of its capital stock,
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then the conversion privilege and the conversion price or conversion rate in
effect immediately prior to the opening of business on the record date for such
dividend or distribution or the effective date of such subdivision, combination
or reclassification shall be adjusted so that the Holder of any Security
thereafter converted may receive the number of shares of capital stock of the
Parent which such Holder would have owned immediately following such action if
such Holder had converted the Security immediately prior to such time. Such
adjustment shall be made successively whenever any event listed above shall
occur.
For a dividend or distribution, the adjustment shall become effective
immediately after the record date for the dividend or distribution. For a
subdivision, combination or reclassification, the adjustment shall become
effective immediately after the effective date of the subdivision, combination
or reclassification.
If after an adjustment a Holder of a Security upon conversion of it may
receive shares of two or more classes of capital stock of the Parent, the
conversion prices of the classes of capital stock (after giving effect to such
allocation of the adjusted conversion price between or among the classes of
capital stock as the Board of Directors shall determine to be appropriate) or
the conversion rate, as the case may be, shall thereafter be subject to
adjustment on terms comparable to those applicable to Parent Stock in this
Indenture.
Any shares of Parent Stock issuable in payment of a dividend shall be deemed
to have been issued immediately prior to the time of the record date for such
dividend for purposes of calculating the number of outstanding shares of Parent
Stock under Sections 11.08 and 11.09 below.
Section 11.08. Adjustment for Rights Issue.
If the Parent issues any rights or warrants to all holders of shares of its
Parent Stock entitling them for a period expiring within 45 days after the
record date mentioned below to purchase shares of Parent Stock (or Convertible
Securities) at a price per share (or having a conversion price per share, after
adding thereto an allocable portion of the exercise price of the right or
warrant to purchase such Convertible Securities, computed on the basis of the
maximum number of shares of Parent Stock issuable upon conversion of such
Convertible Securities) less than the Average Market Price on the Determination
Date, the conversion price or rate shall be adjusted so that it shall equal the
price or rate determined by multiplying the conversion price or dividing the
conversion rate, as the case may be, in effect immediately prior to the opening
of business on that record date by a fraction, of which the numerator shall be
the number of shares of Parent Stock outstanding on such record date plus the
number of shares of Parent Stock which the aggregate offering price of the
total number of shares of Parent Stock so offered (or the aggregate conversion
price of the Convertible Securities to be so offered, after adding thereto the
aggregate exercise price of the rights or warrants to purchase such Convertible
Securities) would purchase at such Average Market Price and of which the
denominator shall be the number of shares of Parent Stock outstanding on such
record date plus the number of additional shares of Parent Stock offered for
subscription or purchase (or into which the Convertible Securities so offered
are convertible). Shares of Parent Stock owned by or held for the account of
the Parent shall not be deemed outstanding for the purpose of any such
adjustment.
For purposes of this Section 11.08, the number of shares of Parent Stock
outstanding on any record date shall be deemed to include (i) the maximum
number of shares of Parent Stock the issuance of which would be necessary to
effect the full exercise, exchange or conversion of all Convertible Securities
outstanding on such record date which are then exercisable, exchangeable or
convertible at a price equal to or less than the Average Market Price per share
of Parent Stock, if all of such Convertible Securities were deemed to have been
exercised, exchanged or converted immediately prior to the opening of business
of such record date and (ii) if the Series B TCI Group Common Stock is
convertible into Parent Stock, the maximum number of shares of Parent Stock the
issuance of which would be necessary to effect the full conversion of all
shares of Series B TCI Group Common Stock outstanding on such record date, if
all of such shares of Series B TCI Group Common Stock were deemed to have been
converted immediately prior to the opening of business on such record date.
39
<PAGE>
The adjustment shall be made successively whenever any such rights or
warrants are issued, and shall become effective immediately after the record
date for the determination of stockholders entitled to receive the rights or
warrants. If all of the shares of Parent Stock (or all of the Convertible
Securities) subject to such rights or warrants have not been issued when such
rights or warrants expire (or, in the case of rights or warrants to purchase
Convertible Securities which have been exercised, all of the shares of Parent
Stock issuable upon conversion of such Convertible Securities have not been
issued prior to the expiration of the conversion right thereof), then the
conversion price or conversion rate shall promptly be readjusted to the
conversion price or conversion rate which would then be in effect had the
adjustment upon the issuance of such rights or warrants been made on the basis
of the actual number of shares of Parent Stock (or Convertible Securities)
issued upon the exercise of such rights or warrants (or the conversion of such
Convertible Securities).
No adjustment shall be made under this Section 11.08 if the adjusted
conversion price would be higher than, or the adjusted conversion rate would be
less than, the conversion price or conversion rate, as the case may be, in
effect prior to such adjustment.
Section 11.09. Adjustments for Other Distributions.
If the Parent distributes to all holders of shares of Parent Stock any assets
or debt securities or any rights or warrants to purchase securities, the
conversion price or conversion rate shall be adjusted by multiplying the
conversion price or dividing the conversion rate, as the case may be, in effect
immediately prior to the opening of business on the record date mentioned below
by a fraction of which the numerator shall be the total number of shares of
Parent Stock outstanding on such record date multiplied by the Average Market
Price on the Determination Date, less the fair market value (as determined by
the Board of Directors) on such record date of said assets or debt securities
or rights or warrants so distributed, and of which the denominator shall be the
total number of shares of Parent Stock outstanding on such record date
multiplied by such Average Market Price.
For purposes of this Section 11.09, the number of shares of Parent Stock
outstanding on any record date shall be deemed to include (i) the maximum
number of shares of Parent Stock the issuance of which would be necessary to
effect the full exercise, exchange or conversion of all Convertible Securities
outstanding on such record date which are then exercisable, exchangeable or
convertible at a price equal to or less than the Average Market Price, if all
of such Convertible Securities were deemed to have been exercised, exchanged or
converted immediately prior to the opening of business on such record date and
(ii) if the Series B TCI Group Common Stock is convertible into Parent Stock,
the maximum number of shares of Parent Stock the issuance of which would be
necessary to effect the full conversion of all shares of Series B TCI Group
Common Stock outstanding on such record date, if all of such shares of Series B
TCI Group Common Stock were deemed to have been converted immediately prior to
the opening of business on such record date.
The adjustment shall be made successively whenever any such distribution is
made, and shall become effective immediately after the record date for the
determination of stockholders entitled to receive the distribution. Shares of
Parent Stock owned by or held for the account of the Parent shall not be deemed
outstanding for the purpose of any such adjustment.
No adjustment shall be made under this Section 11.09 if the adjusted
conversion price would be higher than, or the adjusted conversion rate would be
less than, the conversion price or conversion rate, as the case may be, in
effect prior to such adjustment.
This Section does not apply to cash dividends or distributions. Also, this
Section does not apply to dividends or distributions referred to in Section
11.07 or to rights or warrants referred to in Section 11.08.
Section 11.10. Voluntary Adjustment.
The Company at any time may reduce the conversion price or increase the
conversion rate, temporarily or otherwise, by any amount but in no event shall
such adjusted conversion price or conversion rate result in shares of Parent
Stock being issuable upon conversion of the Securities if converted at the time
of such adjustment at an effective conversion price per share less than the par
value of the Parent Stock at the time such adjustment is made.
40
<PAGE>
A voluntary adjustment of the conversion price or conversion rate pursuant to
this Section 11.10 does not change or adjust the conversion price or conversion
rate otherwise in effect for purposes of Section 11.07, 11.08 or 11.09. If an
event requiring an adjustment to the conversion price or conversion rate
pursuant to Section 11.07, 11.08 or 11.09 occurs at any time that a voluntary
adjustment to the conversion price or conversion rate is in effect pursuant to
this Section 11.10, then the adjustment required by Section 11.07, 11.08 or
11.09, whichever is applicable, shall be made to the conversion price or
conversion rate that would otherwise have been in effect as of the relevant
date specified in such Section had no voluntary adjustment pursuant to this
Section 11.10 been made, and for purposes of applying such Section, any such
voluntary adjustment shall be disregarded. If such adjustment would result in a
lower conversion price or a higher conversion rate, as the case may be, than
the conversion price or conversion rate as voluntarily adjusted by the Company,
then such lower conversion price or higher conversion rate shall be the
conversion price or conversion rate, as the case may be.
Section 11.11. Certain Definitions.
For the purposes of this Article, the following terms have the following
meanings:
"Average Market Price" of a share of Parent Stock on the Determination
Date for any issuance of rights or warrants or any distribution in respect
of which the Average Market Price is being calculated means the average of
the daily current market prices of the Parent Stock for the shortest of:
(i) the period of 30 consecutive trading days commencing 45 trading
days before such Determination Date,
(ii) the period commencing on the date next succeeding the first
public announcement of the issuance of rights or warrants or the
distribution in respect of which the Average Market Price is being
calculated and ending on the last full trading day before such
Determination Date, and
(iii) the period, if any, commencing on the date next succeeding the
Ex-Dividend Date with respect to the next preceding issuance of rights
or warrants or distribution for which an adjustment is required by the
provisions of Section 11.07(4), 11.08 or 11.09, and ending on the last
full trading day before such Determination Date.
If the record date for an issuance of rights or warrants or a
distribution for which an adjustment is required by the provisions of
Section 11.07(4), 11.08 or 11.09 (the "preceding adjustment event")
precedes the record date for the issuance or distribution in respect of
which the Average Market Price is being calculated and the Ex-Dividend Date
for such preceding adjustment event is on or after the Determination Date
for the issuance or distribution in respect of which the Average Market
Price is being calculated, then the Average Market Price shall be adjusted
by deducting therefrom the fair market value (on the record date for the
issuance or distribution in respect of which the Average Market Price is
being calculated), as determined by the Board of Directors, of the capital
stock, rights, warrants, assets or debt securities issued or distributed in
respect of each share of Parent Stock in such preceding adjustment event.
Further, in the event that the Ex-Dividend Date (or in the case of a
subdivision, combination or reclassification, the effective date with
respect thereto) with respect to a dividend, subdivision, combination or
reclassification to which Section 11.07(1), (2), (3) or (5) applies occurs
during the period applicable for calculating the Average Market Price, then
the Average Market Price shall be calculated for such period in a manner
determined by the Board of Directors to reflect the impact of such
dividend, subdivision, combination or reclassification on the current
market price of the Parent Stock during such period.
"current market price" of a share of Parent Stock on any day means the
last reported sale price (or, if no sale price is reported, the average of
the high and low bid prices) on such day on the NASDAQ Stock Market or as
quoted by the National Quotation Bureau Incorporated, or if the Parent
Stock is listed on an exchange, on the principal exchange on which the
Parent Stock is listed. In the event that no such quotation is available
for any day, the Board of Directors shall be entitled to determine the
current market price on the basis of such quotations as it considers
appropriate.
"Determination Date" for any issuance of rights or warrants or any
distribution to which Section 11.08 or 11.09 applies means the earlier of
(i) the record date for the determination of stockholders entitled
41
<PAGE>
to receive the rights or warrants or the distribution to which such Section
applies and (ii) the Ex-Dividend Date for such rights, warrants or
distribution.
"Ex-Dividend Date" means the date on which "ex-dividend" trading
commences for a dividend, an issuance of rights or warrants or a
distribution to which any of Sections 11.07, 11.08 and 11.09 applies in the
over-the-counter market or on the principal exchange on which the Parent
Stock is then quoted or listed.
Section 11.12. When Adjustment May Be Deferred.
In any case in which this Article shall require that an adjustment shall
become effective immediately after a record date for an event, the Company may
defer until the occurrence of such event (i) issuing to the Holder of any
Security converted after such record date and before the occurrence of such
event the additional shares of Parent Stock issuable upon such conversion by
reason of the adjustment required by such event over and above the shares of
Parent Stock issuable upon such conversion before giving effect to such
adjustment and (ii) paying to such Holder cash or its check in lieu of any
fractional interest to which he is entitled pursuant to Section 11.04;
provided, however, that the Company shall deliver to such Holder a due bill or
other appropriate instrument evidencing such Holder's rights to receive such
additional shares of Parent Stock, and such cash, upon the occurrence of the
event requiring such adjustment.
Section 11.13. When Adjustment Is Not Required.
No adjustments in the conversion price or conversion rate need be made unless
the adjustment would require an increase or decrease of at least one percent
(1%) in the initial conversion price or conversion rate. Any adjustment which
is not made shall be carried forward and taken into account in any subsequent
adjustment.
All calculations under this Article shall be made to the nearest cent or to
the nearest 1/100th of a share, as the case may be.
No adjustment in the conversion price or conversion rate shall be made
because the Parent issues, in exchange for cash, property or services, shares
of Parent Stock, or any securities convertible into or exchangeable for shares
of Parent Stock, or securities carrying the right to purchase shares of Parent
Stock or such convertible or exchangeable securities.
No adjustment in the conversion price or conversion rate need be made under
this Article for sales of shares of Parent Stock pursuant to a Parent plan
providing for reinvestment of dividends or interest or in the event the par
value of the Parent Stock is changed.
No adjustment in the conversion price or conversion rate need be made for a
transaction referred to in Section 11.07, 11.08 or 11.09 if Securityholders are
to participate in the transaction on a basis and with notice that the Board of
Directors determines to be fair and appropriate in light of the basis and
notice on which holders of Parent Stock participate in the transaction;
provided that the basis on which the Securityholders are to participate in the
transaction shall not be deemed to be fair if it would require the conversion
of Securities at any time prior to the expiration of the conversion period
specified for such Securities.
To the extent the Securities become convertible into cash, no adjustment need
be made thereafter as to the cash. Interest will not accrue on the cash.
Section 11.14. Notice of Adjustment.
Whenever the conversion price or conversion rate is adjusted, the Company
shall promptly mail to Securityholders a notice of the adjustment and file with
the Trustee an Officers' Certificate briefly stating the new conversion price
or conversion rate, the date it becomes effective, the facts requiring the
adjustment and the manner of computing it. The certificate shall be conclusive
evidence that the adjustment is correct.
42
<PAGE>
Section 11.15. Notice of Certain Transactions.
If:
(1) the Parent takes any action which would require an adjustment in the
conversion price or conversion rate;
(2) the Parent consolidates or merges with, or transfers all or
substantially all of its assets to, another corporation, and stockholders
of the Parent must approve the transaction; or
(3) there is a dissolution or liquidation of the Parent,
a Holder of a Security may want to convert it into shares of Parent Stock prior
to the record date for, or the effective date of, the transaction so that he
may receive the rights, warrants, securities or assets which a holder of shares
of Parent Stock on that date may receive. Therefore, the Company shall mail to
the Securityholders and the Trustee a notice stating the proposed record or
effective date, as the case may be. Failure to mail the notice or any defect in
it shall not affect the validity of any transaction referred to in clause (1),
(2) or (3) of this Section.
Section 11.16. Consolidation, Merger or Sale of the Parent.
If the Parent is a party to a transaction described in Section 5.01 or a
merger which reclassifies or changes its outstanding Parent Stock, the Company
shall enter into a supplemental indenture. The supplemental indenture shall
provide that the Holder of a Security may convert it into the kind and amount
of securities or cash or other assets which he would have owned immediately
after the consolidation, merger or transfer if he had converted the Security
immediately before the effective date of such transaction, assuming (to the
extent applicable) that such Holder failed to exercise any rights of election
with respect thereto and received per share of Parent Stock the kind and amount
of securities, cash or as received per share by a plurality of the non-electing
shares. The supplemental indenture shall provide for adjustments which shall be
as nearly equivalent as may be practical to the adjustments provided for in
this Article. The Company shall mail to each Securityholder a notice describing
the supplemental indenture.
If this Section applies, Sections 11.07, 11.08 and 11.09 shall not apply.
Section 11.17. Company Determination Final.
Any determination which the Board of Directors must make pursuant to Sections
11.07, 11.09, 11.11, 11.13 or 11.16 is conclusive and binding on the Holders.
Section 11.18. Trustee's Disclaimer.
Neither the Trustee nor any Conversion Agent has any duty to determine when
an adjustment under this Article should be made, how it should be made or what
it would be. Neither the Trustee nor any Conversion Agent has any duty to
determine whether any provisions of a supplemental indenture under Section
11.16 are correct. Neither the Trustee nor any Conversion Agent makes any
representation as to the validity or value of any securities or assets issued
upon conversion of Securities. Neither the Trustee nor any Conversion Agent
shall be responsible for the Company's failure to comply with this Article.
Section 11.19. Simultaneous Adjustments.
In the event that this Article Eleven requires adjustments to the conversion
price or conversion rate under more than one of Sections 11.07(4), 11.08 or
11.09, and the record dates for the distributions giving rise to such
adjustments shall occur on the same date, then such adjustments shall be made
by applying, first, the provisions of Section 11.07, second, the provisions of
Section 11.09 and, third, the provisions of Section 11.08.
43
<PAGE>
ARTICLE TWELVE
Miscellaneous
Section 12.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by any of TIA (S)(S)310 to 317, inclusive, through operation of
TIA (S)318(c), such imposed duties shall control.
Section 12.02. Notices.
Any notice or communication shall be sufficiently given if in writing and
delivered in person or mailed by first-class mail addressed as follows:
If to the Company:
TCI Communications, Inc.
Terrace Tower II
5619 DTC Parkway
Englewood, Colorado 80111
Attention: Bernard W. Schotters, Senior Vice-President--Finance
and Treasurer
If to the Trustee:
Attention:
The Company or the Trustee by notice to the other may designate additional or
different addresses for subsequent notices or communications.
Any notice or communication mailed to a Securityholder shall be mailed to him
at his address as it appears on the registration books of the Registrar and
shall be sufficiently given to him if so mailed within the time prescribed.
Failure to mail a notice or communication to a Securityholder or any defect
in it shall not affect its sufficiency with respect to other Securityholders.
Except for a notice to the Trustee, which is deemed given only when received,
if a notice or communication is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it.
Section 12.03. Communication by Holders with Other Holders.
Securityholders may communicate pursuant to TIA (S)312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and anyone else shall have
the protection of TIA (S)312(c).
Section 12.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee:
(1) an Officers' Certificate stating that, in the opinion of the signers,
all conditions precedent (including any covenants compliance with which
constitutes a condition precedent), if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such counsel,
all such conditions precedent (including any covenants compliance with
which constitutes a condition precedent) have been complied with.
44
<PAGE>
Section 12.05. Statements Required in Certificate or Opinion.
Each Officers' Certificate or Opinion of Counsel with respect to compliance
with a condition or covenant provided for in this Indenture (other than
certificates provided pursuant to Section 4.03) shall include:
(1) a statement that the person making such certificate or opinion has
read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such person, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and
(4) a statement as to whether or not, in the opinion of such person, such
condition or covenant has been complied with.
Section 12.06. When Treasury Securities Disregarded.
In determining whether the Holders of the required aggregate principal amount
of Securities of any series have concurred in any direction, waiver or consent,
Securities of such series owned by the Company or by any Affiliate of the
Company shall be disregarded and treated as not outstanding, except that for
the purposes of determining whether the Trustee shall be protected in relying
on any such direction, waiver or consent, only Securities of such series which
the Trustee knows are so owned shall be so disregarded.
Section 12.07. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or a meeting of the
Securityholders of all series or any series. The Registrar, Paying Agent or
Conversion Agent may make reasonable rules for its functions.
Section 12.08. Legal Holidays.
A "Legal Holiday" is a Saturday, a Sunday or a day on which banking
institutions in the City of New York, New York are not required to be open. If
a specified date (including a date for giving notice) or the last day to
convert a Security is a Legal Holiday, any action to be taken on such date
pursuant to this Indenture or the Securities (including such conversion) may be
taken on the next succeeding day that is not a Legal Holiday, and to the extent
applicable, no interest, or original issue discount, as the case may be, shall
accrue for the intervening period.
Section 12.09. Governing Law.
The internal laws of the State of New York shall govern this Indenture and
the Securities.
Section 12.10. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or debt
agreement of the Company or a Subsidiary. Any such indenture, loan or debt
agreement may not be used to interpret this Indenture.
Section 12.11. No Recourse Against Others.
No past, present or future director, officer, employee or stockholder, as
such, of the Company or any successor thereof shall have any liability for any
obligations of the Company under the Securities or this Indenture or for any
claim based on, in respect of, or by reason of, such obligations or their
creation and all such liability is hereby waived and released. Such waiver and
release are part of the consideration for the issue of the Securities.
45
<PAGE>
Section 12.12. Successors.
All agreements of the Company in this Indenture and the Securities shall bind
its successor. All agreements of the Trustee in this Indenture shall bind its
successor.
Section 12.13. Duplicate Originals.
The parties may sign any number of copies of this Indenture. Each signed copy
shall be an original, but all of them together represent the same agreement.
Section 12.14. Table of Contents, Headings, etc.
The table of contents and the titles and headings of the Articles and
Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part hereof, and shall in no way modify or
restrict any of the terms or provisions hereof.
46
<PAGE>
Signatures
Dated: , 199
TCI Communications, Inc.
By __________________________________
(Seal)
Attest: _____________________________
Secretary
Dated: , 199
By __________________________________
(Seal)
47
<PAGE>
EXHIBIT 4.3
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
TELE-COMMUNICATIONS, INC.
AND
TRUSTEE
----------------
INDENTURE
DATED AS OF , 199
----------------
SUBORDINATED DEBT SECURITIES
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
CROSS-REFERENCE TABLE
<TABLE>
<CAPTION>
TIA INDENTURE
SECTION SECTION
<C> <S> <C>
310 (a)(1).............................................. 7.10
(a)(2).............................................. 7.10
(a)(3).............................................. N.A.
(a)(4).............................................. N.A.
(a)(5).............................................. 7.10
(b)................................................. 7.08; 7.10; 12.02
(c)................................................. N.A.
311 (a)................................................. 7.11
(b)................................................. 7.11
(c)................................................. N.A.
312 (a)................................................. 2.07
(b)................................................. 12.03
(c)................................................. 12.03
313 (a)................................................. 7.06
(b)(1).............................................. N.A.
(b)(2).............................................. 7.06
(c)................................................. 12.02
(d)................................................. 7.06
314 (a)................................................. 4.02; 4.03; 12.02
(b)................................................. N.A.
(c)(1).............................................. 12.04
(c)(2).............................................. 12.04
(c)(3).............................................. N.A.
(d)................................................. N.A.
(e)................................................. 12.05
(f)................................................. N.A.
315 (a)................................................. 7.01(b)
(b)................................................. 7.05; 12.02
(c)................................................. 7.01(a)
(d)................................................. 7.01(c)
(e)................................................. 6.11
316 (a)(last sentence).................................. 12.06
(a)(1)(A)........................................... 6.05
(a)(1)(B)........................................... 6.04
(a)(2).............................................. N.A.
(b)................................................. 6.07
317 (a)(1).............................................. 6.08
(a)(2).............................................. 6.09
(b)................................................. 2.06
318 (a)................................................. 12.01
</TABLE>
- --------
N.A. means Not Applicable.
2
<PAGE>
TABLE OF CONTENTS
----------------
<TABLE>
<CAPTION>
Section Heading Page
<C> <S> <C>
ARTICLE ONE
Definitions and Incorporation by Reference
1.01. Definitions...................................................... 7
1.02. Other Definitions................................................ 9
1.03. Incorporation by Reference of Trust Indenture Act................ 9
1.04. Rules of Construction............................................ 9
ARTICLE TWO
The Securities
2.01. Forms Generally and Dating....................................... 10
2.02. Amount Unlimited; Issuable in Series............................. 10
2.03. Denominations.................................................... 12
2.04. Execution and Authentication..................................... 12
2.05. Registrar, Paying Agent and Conversion Agent..................... 14
2.06. Paying Agent to Hold Money and Securities in Trust............... 14
2.07. Securityholder Lists............................................. 14
2.08. Transfer and Exchange............................................ 14
2.09. Replacement Securities........................................... 16
2.10. Outstanding Securities........................................... 16
2.11. Temporary Securities............................................. 17
2.12. Cancellation..................................................... 17
2.13. Payment of Interest; Defaulted Interest.......................... 17
2.14. Persons Deemed Owners............................................ 18
2.15. Securities in Global Form........................................ 18
ARTICLE THREE
Redemption
3.01. Applicability of Article......................................... 19
3.02. Notices to Trustee............................................... 19
3.03. Selection of Securities to be Redeemed........................... 19
3.04. Notice of Redemption............................................. 20
3.05. Effect of Notice of Redemption................................... 20
3.06. Deposit of Redemption Price...................................... 20
3.07. Securities Redeemed in Part...................................... 21
3.08. Conversion Arrangement on Call for Redemption.................... 21
ARTICLE FOUR
Covenants
4.01. Payment of Securities............................................ 21
4.02. SEC Reports...................................................... 21
4.03. Compliance Certificate........................................... 21
4.04. Corporate Existence.............................................. 22
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
Section Heading Page
<C> <S> <C>
ARTICLE FIVE
Successor Corporation
5.01. When Company May Merge, etc...................................... 22
ARTICLE SIX
Defaults and Remedies
6.01. Events of Default................................................ 22
6.02. Acceleration..................................................... 23
6.03. Other Remedies................................................... 23
6.04. Waiver of Existing Defaults...................................... 24
6.05. Control by Majority.............................................. 24
6.06. Limitation on Suits.............................................. 24
6.07. Rights of Holders to Receive Payment and to Convert.............. 24
6.08. Collection Suit by Trustee....................................... 24
6.09. Trustee May File Proofs of Claim................................. 25
6.10. Priorities....................................................... 25
6.11. Undertaking for Costs............................................ 25
ARTICLE SEVEN
Trustee
7.01. Duties of Trustee................................................ 25
7.02. Rights of Trustee................................................ 26
7.03. Individual Rights of Trustee..................................... 26
7.04. Trustee's Disclaimer............................................. 26
7.05. Notice of Defaults............................................... 26
7.06. Reports by Trustee to Holders.................................... 27
7.07. Compensation and Indemnity....................................... 27
7.08. Replacement of Trustee........................................... 27
7.09. Successor Trustee by Merger, etc................................. 28
7.10. Eligibility; Disqualification.................................... 28
7.11. Preferential Collection of Claims Against Company................ 28
ARTICLE EIGHT
Discharge of Indenture
8.01. Termination of Company's Obligations............................. 28
8.02. Application of Trust Fund........................................ 29
8.03. Repayment to Company............................................. 29
ARTICLE NINE
Amendments, Supplements and Waivers
9.01. Without Consent of Holders....................................... 29
9.02. With Consent of Holders.......................................... 30
9.03. Compliance with Trust Indenture Act.............................. 31
9.04. Revocation and Effect of Consents................................ 31
9.05. Notation on or Exchange of Securities............................ 31
9.06. Trustee to Sign Amendments, etc.................................. 31
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
Section Heading Page
<C> <S> <C>
ARTICLE TEN
Subordination
10.01. Securities Subordinated to Senior Debt........................... 31
10.02. Company Not to Make Payments with Respect to Securities in
Certain Circumstances........................................... 32
10.03. Securities Subordinated to Prior Payment of All Senior Debt on
Dissolution, Liquidation or Reorganization of Company........... 32
10.04. Securityholders to be Subrogated to Right of Holders of Senior
Debt............................................................ 33
10.05. Obligation of the Company Unconditional.......................... 33
10.06. Trustee Entitled to Assume Payments Not Prohibited in Absence of
Notice.......................................................... 34
10.07. Application by Trustee of Monies or U.S. Government Obligations
Deposited with It............................................... 34
10.08. Subordination Rights Not Impaired by Acts or Omissions of Company
or Holders of Senior Debt....................................... 35
10.09. Securityholders Authorize Trustee to Effective Subordination of
Securities...................................................... 35
10.10. Right of Trustee to Hold Senior Debt............................. 35
10.11. Article Ten Not to Prevent Events of Default..................... 35
ARTICLE ELEVEN
Conversion
11.01. Applicability of Article......................................... 35
11.02. Conversion Privilege............................................. 35
11.03. Conversion Procedures............................................ 36
11.04. Fractional Shares................................................ 37
11.05. Taxes on Conversion.............................................. 37
11.06. Company to Provide Stock......................................... 37
11.07. Adjustment for Change in Capital Stock........................... 37
11.08. Adjustment for Rights Issue...................................... 38
11.09. Adjustments for Other Distributions.............................. 39
11.10. Voluntary Adjustment............................................. 39
11.11. Certain Definitions.............................................. 40
11.12. When Adjustment May be Deferred.................................. 41
11.13. When Adjustment Is Not Required.................................. 41
11.14. Notice of Adjustment............................................. 41
11.15. Notice of Certain Transactions................................... 41
11.16. Consolidation, Merger or Sale of the Company..................... 42
11.17. Company Determination Final...................................... 42
11.18. Trustee's Disclaimer............................................. 42
11.19. Simultaneous Adjustments......................................... 42
ARTICLE TWELVE
Miscellaneous
12.01. Trust Indenture Act Controls..................................... 42
12.02. Notices.......................................................... 43
12.03. Communication by Holders with Other Holders...................... 43
12.04. Certificate and Opinion as to Conditions Precedent............... 43
12.05. Statements Required in Certificate or Opinion.................... 43
12.06. When Treasury Securities Disregarded............................. 44
12.07. Rules by Trustee and Agents...................................... 44
12.08. Legal Holidays................................................... 44
</TABLE>
5
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<TABLE>
<CAPTION>
Section Heading Page
<C> <S> <C>
12.09. Governing Law.................................................... 44
12.10. No Adverse Interpretation of Other Agreements.................... 44
12.11. No Recourse Against Others....................................... 44
12.12. Successors....................................................... 44
12.13. Duplicate Originals.............................................. 45
12.14. Table of Contents, Headings, Etc................................. 45
Signatures................................................................ 46
</TABLE>
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INDENTURE dated as of , 199 , between TCI COMMUNICATIONS, INC., a
Delaware corporation ("Company"), and ("Trustee").
The Company has duly authorized the execution and delivery of this Indenture
to provide for the issuance from time to time of its unsecured subordinated
debentures, notes, bonds or other evidences of subordinated indebtedness
("Securities"), to be issued in one or more series as provided in this
Indenture.
Each party agrees as follows for the benefit of the other party and for the
equal and ratable benefit of the respective Holders from time to time of
Securities or of series thereof:
ARTICLE ONE
Definitions and Incorporation by Reference
Section 1.01. Definitions.
Affiliate of any person means any other person directly or indirectly
controlling or controlled by or under direct or indirect common control with
such person.
Agent means any Registrar, Paying Agent, co-Registrar or Conversion Agent.
See Section 2.05.
Board of Directors means the Board of Directors of the Company or any
authorized committee thereof.
Business Day means any day which is not a Legal Holiday.
Class B Stock means the Class B Common Stock, $1.00 par value, of the
Company as it exists on the date of this Indenture and stock of any other
class into which such Class B Common Stock may thereafter have been changed.
Company means the TCI Communications, Inc., a Delaware corporation, until a
successor replaces it pursuant to the applicable provisions of this Indenture
and thereafter means the successor.
Convertible Securities means any or all options, warrants, securities and
rights, except the Series B TCI Group Common Stock and the Securities, which
are convertible into or exercisable or exchangeable for Parent Stock or which
otherwise entitle the holder thereof to subscribe for, purchase or otherwise
acquire Parent Stock.
Default means any event which is, or after notice or passage of time or both
would be, an Event of Default.
Holder or Securityholder means the person in whose name a Security is
registered on the Registrar's books.
Indenture means this Indenture as amended or supplemented from time to time
and, unless the context indicates otherwise, shall include the form and terms
of a particular series of Securities established as contemplated hereunder.
interest, when used with respect to an Original Issue Discount Security
which by its terms bears interest only after maturity or upon default in any
other payment due on such Security, means interest payable after maturity or
upon such default, as the case may be.
Interest Payment Date means the date, if any, specified in the Securities of
any series as the fixed date on which any installment of interest on the
Securities of that series is due and payable.
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Officer means the Chairman of the Board, the President, any Vice President,
the Treasurer or the Secretary of the Company.
Officers' Certificate means a certificate signed by two Officers or by an
Officer and an Assistant Treasurer or an Assistant Secretary of the Company
and delivered to the Trustee. See Sections 12.04 and 12.05.
Opinion of Counsel means a written opinion from legal counsel who is
acceptable to the Trustee. The counsel may be an employee of or counsel to the
Company or the Trustee. See Sections 12.04 and 12.05.
original issue discount of any debt security, including any Original Issue
Discount Security, means the difference between the principal amount of such
debt security and the initial issue price of such debt security (as set forth,
in the case of an Original Issue Discount Security, on the face of such
Security).
Original Issue Discount Security means any Security which provides for an
amount less than the principal amount thereof to be due and payable upon
acceleration of the maturity thereof pursuant to Section 6.02.
Parent means Tele-Communications, Inc., a Delaware corporation, and any
successor thereof.
Parent Stock means the Tele-Communications, Inc. Series A TCI Group Common
Stock, $1.00 par value, as it exists on the date of this Indenture and any
other capital stock into which such Series A TCI Group Common Stock may
thereafter have been changed.
principal of a debt security, including any Security, means the amount
(including, without limitation, if and to the extent applicable, any premium
and, in the case of an Original Issue Discount Security, any accrued original
issue discount, but excluding interest) that is payable with respect to such
debt security as of any date and for any purpose (including, without
limitation, in connection with any sinking fund, upon any redemption at the
option of the Company, upon any purchase or exchange at the option of the
Company or the holder of such debt security and upon any acceleration of the
maturity of such debt security).
principal amount of a debt security, including any Security, means the
principal amount as set forth on the face of such debt security.
Regular Record Date means the date, if any, specified in the Securities of
any series as the record date for the determination of Securityholders to whom
interest is payable on the next succeeding Interest Payment Date.
SEC means the Securities and Exchange Commission.
Securities means the Securities that are issued from time to time in one or
more series under this Indenture as such Securities are amended or
supplemented from time to time.
Series B TCI Group Common Stock means the Tele-Communications, Inc. Series B
TCI Group Common Stock, $1.00 par value, as it exists on the date of this
Indenture and any other capital stock into which such Series B TCI Group
Common Stock may thereafter have been changed.
Subsidiary means a corporation a majority of whose voting stock is owned by
the Company and/or one or more Subsidiaries. Voting stock is capital stock
having voting power under ordinary circumstances to elect directors.
TIA means the Trust Indenture Act of 1939 (15 U.S. Code (S)(S) 77aaa-77bbbb)
as in effect on the date of this Indenture, except as provided in Section
9.03.
Trustee means the party named as such in this Indenture until a successor
replaces it and thereafter means the successor and if at any time there is
more than one such party, "Trustee" as used with respect to the Securities of
any series shall mean the Trustee with respect to Securities of that series.
Trust Officer, when used with respect to the Trustee, shall mean the
chairman or any vice-chairman of the board of directors, the chairman or any
vice-chairman of the executive committee of the board of directors, the
chairman of the trust committee, the president, any vice-president, the
treasurer, any assistant treasurer, the secretary, any assistant secretary,
any trust officer, any second or assistant vice-president, or any officer or
assistant officer of the Trustee other than those specifically above-mentioned
customarily performing functions
8
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similar to those performed by such above-mentioned officers and also means
with respect to a particular corporate trust matter, any other officer to whom
such matter is referred because of his knowledge of and familiarity with the
particular subject.
United States means the United States of America.
U.S. Government Obligations means direct obligations of, or obligations
entitled to the full faith and credit of, the United States of America.
Section 1.02. Other Definitions.
<TABLE>
<CAPTION>
TERM DEFINED IN SECTION
<S> <C>
Average Market Price.................................. 11.11
Bankruptcy Law........................................ 6.01
Code.................................................. 9.01
Conversion Agent...................................... 2.05
current market price.................................. 11.11
Custodian............................................. 6.01
Debt.................................................. 10.01
Determination Date.................................... 11.11
Event of Default...................................... 6.01
Ex-Dividend Date...................................... 11.11
Legal Holiday......................................... 12.08
Paying Agent.......................................... 2.05
Registrar............................................. 2.05
Senior Debt........................................... 10.01
</TABLE>
Section 1.03. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
Commission means the SEC.
indenture securities means the Securities.
indenture security holder means a Securityholder.
indenture to be qualified means this Indenture.
indenture trustee or institutional trustee means the Trustee.
obligor on the indenture securities means the Company and any other
obligor thereon.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule have the
meanings assigned to them.
Section 1.04. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned to
it in accordance with generally accepted accounting principles in effect on
the date of this Indenture;
(3) "or" is not exclusive; and
(4) words in the singular include the plural, and in the plural include
the singular.
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<PAGE>
ARTICLE TWO
The Securities
Section 2.01. Forms Generally and Dating.
The Securities of each series may be issued in whole or in part in the form
of one or more global Securities as shall be specified as contemplated by
Section 2.02. The Securities of each series (including any temporary global
Securities) shall be in one of the forms established from time to time by or
pursuant to a resolution of the Board of Directors or in or pursuant to one or
more indentures supplemental hereto, which shall set forth the information
required by Section 2.02. The Securities shall have such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture or by a resolution of the Board of Directors and
may have such notations, legends or endorsements as the Company may deem
appropriate and as are not inconsistent with the provisions of this Indenture,
or as may be required by law, stock exchange rule or usage. The Company shall
approve the form or forms of the Securities and any notation, legend or
endorsement on them. If the form or forms of Securities of any series is
established by action taken pursuant to a resolution of the Board of Directors
or indenture supplemental hereto, a copy of an appropriate record of such
action shall be certified by the Secretary or an Assistant Secretary of the
Company and delivered to the Trustee at or prior to the delivery of the
written order of the Company contemplated by Section 2.04 for the
authentication and delivery of such Securities.
Each Security shall be dated the date of its authentication. The form of the
Trustee's certificate of authentication to be borne by the Securities shall be
substantially as follows:
CERTIFICATE OF AUTHENTICATION
The undersigned certifies that this is one of the Securities of the series
designated herein referred to in the within-mentioned Indenture.
,
as Trustee
By___________________________________
Authorized Officer
Section 2.02. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. There shall be
established in or pursuant to a resolution of the Board of Directors or
established in or pursuant to one or more indentures supplemental hereto,
prior to the issuance of Securities of any series:
(1) the title of the Securities of the series (which shall distinguish
Securities of the series from all other Securities);
(2) any limit upon the aggregate principal amount of Securities of the
series which may be authenticated and delivered under this Indenture
(except for Securities authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other Securities of the
series pursuant to Section 2.08, 2.09, 2.11, 3.07, or 9.05 and except for
any Securities which pursuant to Section 2.04 are deemed not to have been
authenticated and delivered hereunder);
(3) (A) whether any of the Securities of the series are to be issuable in
global form and, if so, (i) the identity of the depositary with respect to
any such global Security and (ii) whether beneficial owners of
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<PAGE>
interests in any such global Security may exchange such interests for
Securities of the same series and of like tenor and of any authorized form
and denomination, and, if so, the circumstances under which and the manner
in which any such exchanges may occur, if other than as specified in
Section 2.08; (B) if any of the Securities of the series are to be issuable
in global form, the date as of which any global Security shall be dated (if
other than the date of original issuance of the first of such Securities to
be issued); and (C) if Securities of the series are to be issuable in
definitive form (whether upon original issue, upon exchange of a temporary
Security of such series, or in exchange for a beneficial ownership interest
in a permanent global Security) only upon receipt of certain certificates
or other documents or satisfaction of other conditions, or if Securities of
the series are initially issuable in temporary global form and if owners of
beneficial interests therein may exchange such interest for an interest in
a permanent global Security only upon receipt of certain certificates or
other documents or satisfaction of other conditions, then the form and/or
terms of such certificates, documents or conditions;
(4) the date or dates (and whether fixed or extendible) on which the
principal of Securities of the series is payable;
(5) the rate or rates at which Securities of the series shall bear
interest, or the method of determining the same, if any, the date or dates
from which such interest shall accrue, the Interest Payment Dates and the
Regular Record Dates;
(6) the place or places where the principal of any interest on Securities
of the series shall be payable;
(7) any provisions relating to the issuance of Securities of such series
at an original discount (including, without limitation, the issue price
thereof, the rate or rates at which such original issue discount shall
accrue, if any, and the date or dates from or to which or period or periods
during which such original issue discount shall accrue at such rate or
rates):
(8) the price or prices at which, the period or periods within which and
the terms and conditions upon which Securities of the series may be
redeemed or otherwise purchased, in whole or in part, at the option of the
Company, pursuant to any sinking fund or otherwise (including, without
limitation the form or method of payment thereof if other than in cash);
(9) the obligation, if any, of the Company to redeem, purchase or repay
Securities of the series pursuant to any sinking fund or analogous
provisions or at the option of a Securityholder thereof and the price or
prices at which and the period or periods within which and the terms and
conditions upon which Securities of the series shall be redeemed, purchased
or repaid, in whole or in part, pursuant to such obligation (including
without limitation, the form or method of payment thereof if other than in
cash);
(10) if other than denominations of $1,000 and any integral multiple
thereof, the denominations in which Securities of the series shall be
issuable;
(11) if other than the principal amount thereof, the portion of the
principal amount of Securities of the series which shall be payable upon
acceleration of the maturity thereof pursuant to Section 6.02 or provable
in bankruptcy pursuant to Section 6.09, or, if applicable, which is
convertible in accordance with Article Eleven;
(12) any Events of Default with respect to the Securities of a particular
series in lieu of or in addition to those set forth herein and the remedies
therefor;
(13) the obligation, if any, of the Company to permit the conversion of
Securities of such series into Parent Stock and the terms and conditions
upon which such conversion shall be effected (including, without
limitation, the initial conversion price or rate, the conversion period and
any other provision in addition to or in lieu of those set forth in this
Indenture relative to such obligation); and
(14) any other terms of a particular series and any other provisions
expressing or referring to the terms and conditions upon which the
Securities of that series are to be issued under the Indenture, which terms
and provisions are not in conflict with the provisions of this Indenture;
provided, however, the addition to or subtraction from or variation of
Articles Four, Five, Six, Eight and Eleven (and Sections 1.01 and 1.02,
insofar as they relate to the definition of certain terms as used in such
Articles) with regard to the Securities of a particular series shall not be
deemed to constitute a conflict with the provisions of those Articles.
11
<PAGE>
All Securities of any one series shall be substantially identical except as
to denomination and except as may otherwise be provided in or pursuant to such
resolution of the Board of Directors or in any such indenture supplemental
hereto. Not all Securities of any one series need be issued at the same time,
and, unless otherwise so provided, a series may be reopened for issuances of
additional Securities of such series.
If any of the terms of the Securities of a series are established by action
taken pursuant to a resolution of the Board of Directors or indenture
supplemental hereto, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee with an Officers' Certificate setting forth the terms
or the manner of determining the terms of the Securities of such series. With
respect to Securities of a series which are not to be issued at one time, such
resolution of the Board of Directors or action may provide general terms or
parameters for Securities of such series and provide either that the specific
terms of particular Securities of such series shall be specified in a written
order of the Company or that such terms shall be determined by the Company or
its agents in accordance with a written order of the Company as contemplated by
the proviso clause of the fourth paragraph of Section 2.04.
Section 2.03. Denominations.
The Securities of each series shall be issuable in registered form without
coupons in such denominations as shall be specified as contemplated by Section
2.02. In the absence of any such provisions with respect to the Securities of
any series, the Securities of such series shall be issuable in denominations of
$1,000 and any integral multiple thereof.
Section 2.04 Execution and Authentication.
Two Officers shall sign the Securities for the Company by facsimile
signature. The Company's seal shall be reproduced on the Securities.
If an Officer whose signature is on a Security no longer holds that office at
the time the Trustee authenticates the Security, the Security shall be valid
nevertheless.
A Security shall not be entitled to any benefit under this Indenture or be
valid for any purpose until the Trustee manually signs the certificate of
authentication on the Security. The signature shall be conclusive evidence that
the Security has been authenticated under this Indenture. Notwithstanding the
foregoing, if any Security shall have been duly authenticated and delivered
hereunder but never issued and sold by the Company, and the Company shall
deliver such Security to the Trustee for cancellation as provided in Section
2.12 together with a written statement (which need not comply with Section
12.04 and 12.05 and need not be accompanied by an Opinion of Counsel) stating
that such Security has not been issued and sold by the Company, for all
purposes of this Indenture such Security shall be deemed not to have been
authenticated and delivered hereunder and shall not be entitled to the benefits
of this Indenture.
At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Securities of any series executed by the
Company to the Trustee for authentication, and the Trustee shall authenticate
and deliver said Securities to or upon the written order of the Company, signed
by two Officers or by an Officer and an Assistant Treasurer of the Company,
without any further action by the Company. Such written order shall specify the
date on which said Securities shall be authenticated; provided, however, that
if not all the Securities of a series are to be issued at one time and if the
resolution of the Board of Directors or indenture supplemental hereto
establishing such series as contemplated by Sections 2.01 and 2.02 shall so
permit, such written order may set forth procedures acceptable to the Trustee
for the issuance of such Securities and for determining the form or terms of
particular Securities of such series including, but not limited to, interest
rate, maturity date, date of issuance and date from which interest shall
accrue.
If the form or forms or terms of the Securities of the series have been
established in or pursuant to one or more resolutions of the Board of Directors
or indentures supplemental hereto as permitted by Sections 2.01 and
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2.02, in authenticating such Securities, and accepting the additional
responsibilities under this Indenture in relation to such Securities, the
Trustee shall be entitled to receive, and (subject to Section 7.01) shall be
fully protected in relying upon, an Opinion of Counsel stating:
(1) if the form or forms of such Securities has been established by or
pursuant to a resolution of the Board of Directors or indenture
supplemental hereto, that such form or forms has been established in
conformity with the provisions of this Indenture;
(2) if the terms of such Securities have been established by or pursuant
to a resolution of the Board of Directors or indenture supplemental hereto,
that such terms have been established in conformity with the provisions of
this Indenture; and
(3) that such Securities, when authenticated and delivered by the Trustee
and issued by the Company in the manner and subject to any conditions
specified in such Opinion of Counsel, will have been duly issued and will
constitute valid and legally binding obligations of the Company,
enforceable in accordance with their terms, subject to bankruptcy,
insolvency, fraudulent conveyance, reorganization and other laws of general
applicability relating to or affecting the enforcement of creditors' rights
and to general equitable principles;
provided, however, that, with respect to Securities of a series which are not
to be issued at one time, the Trustee shall be entitled to receive such Opinion
of Counsel only once at or prior to the time of the first authentication of
Securities of such series and that the opinions described in clauses (2) and
(3) above may state, respectively,
(a) that, when the terms of such Securities shall have been established
pursuant to a written order of the Company or pursuant to such procedures
as may be specified from time to time by a written order of the Company,
all as contemplated by and in accordance with a resolution of the Board of
Directors or an Officers' Certificate pursuant to a resolution of the Board
of Directors or indenture supplemental hereto, as the case may be, such
terms will have been established in conformity with the provisions of this
Indenture; and
(b) that such Securities, when (i) executed by the Company, (ii)
completed, authenticated and delivered by the Trustee in accordance with
this Indenture, (iii) issued and delivered by the Company and (iv) paid
for, all as contemplated by and in accordance with the aforesaid written
order of the Company or specified procedures, as the case may be, will have
been duly issued and will constitute valid and legally binding obligations
of the Company, enforceable in accordance with their terms, subject to
bankruptcy, insolvency, fraudulent conveyance, reorganization and other
laws of general applicability relating to or affecting the enforcement of
creditors' rights and to general equitable principles.
Notwithstanding the provisions of Sections 2.01, 2.02, 12.04 and this
Section, if all the Securities of a series are not to be originally issued at
one time, the resolution of the Board of Directors or indenture supplemental
hereto, the certified copy of the record of action taken pursuant to such
resolution or supplemental indenture, the Officers' Certificate, the written
resolution or supplemental indenture, the written order of the Company and any
other documents otherwise required pursuant to such Sections need not be
delivered at or prior to the time of authentication of each Security of such
series if such documents are delivered at or prior to the authentication upon
original issuance of the first Security of such series to be issued; provided,
however, that any subsequent request by the Company to the Trustee to
authenticate Securities of such series shall constitute a representation and
warranty by the Company that as of the date of such request, the statements
made in the Officers' Certificate delivered pursuant to Section 12.04 at or
prior to authentication of the first such Security shall be true and correct on
the date thereof as if made on and as of the date thereof.
The Trustee shall have the right to decline to authenticate and make
available for delivery any Securities under this Section if the issuance of
such Securities pursuant to this Indenture will affect the Trustee's own
rights, duties or immunities under the Securities and this Indenture or
otherwise in a manner which is not reasonably acceptable to the Trustee.
With respect to Securities of a series which are not all issued at one time,
the Trustee may conclusively rely, as to the authorization by the Company of
any of such Securities, the form and terms thereof and the
13
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legality, validity, binding effect and enforceability thereof, upon the Opinion
of Counsel, Officers' Certificate and other documents delivered pursuant to
Sections 2.01, 2.02, 12.04 and this Section, as applicable, at or prior to the
time of the first authentication of Securities of such series unless and until
such opinion, certificate or other documents have been superseded or revoked.
In connection with the authentication and delivery of Securities of a series
which are not all issued at one time, the Trustee shall be entitled to assume
that the Company's instructions to authenticate and deliver such Securities do
not violate any rules, regulations or orders of any governmental agency or
commission having jurisdiction over the Company.
Section 2.05. Registrar, Paying Agent and Conversion Agent.
The Company shall maintain an office or agency where Securities of each
series may be presented for registration of transfer or for exchange
("Registrar"), an office or agency where Securities of each series may be
presented for payment ("Paying Agent") and an office or agency where Securities
of each series that is convertible may be presented for conversion ("Conversion
Agent"). The Registrar shall keep a register of the Securities of each series
issued hereunder and of their transfer and exchange. The Company may have one
or more co-Registrars (provided that there shall be only one register, which
shall be maintained by the principal Registrar), one or more additional paying
agents and one or more conversion agents with respect to any series. The term
"Paying Agent" includes any additional paying agent and the term "Conversion
Agent" includes any additional conversion agent.
The Company shall enter into an appropriate agency agreement with any Agent
not a party to this Indenture. The agreement shall implement the provisions of
this Indenture that relate to such Agent. The Company shall promptly notify the
Trustee of the name and address of any such Agent. If the Company fails to
maintain a Registrar, Paying Agent or Conversion Agent, the Trustee shall act
as such.
The Company initially appoints the Trustee Registrar and Paying Agent for
each series and the Conversion Agent for any series that is convertible.
Section 2.06. Paying Agent to Hold Money and Securities in Trust.
Subject to Section 10.07, each Paying Agent shall hold in trust for the
benefit of Securityholders of the relevant series or the Trustee all money and
securities held by the Paying Agent for the payment of any amount in respect of
the Securities of such series, and shall notify the Trustee of any default by
the Company in making any such payment. If the Company or a Subsidiary acts as
Paying Agent, it shall segregate such money and securities and hold it as a
separate trust fund. The Company at any time may require a Paying Agent to pay
all money and securities held by it to the Trustee and account for any funds or
securities disbursed. Upon doing so the Paying Agent shall have no further
liability for the money or securities.
Section 2.07. Securityholder Lists.
The Trustee shall preserve in as current a form as is reasonably practicable
the most recent list available to it of the names and addresses of
Securityholders. If the Trustee is not the Registrar, the Company shall furnish
to the Trustee on or before either (1) April 1 and October 1 in each year in
the case of Original Issue Discount Securities of any series which by their
terms do not bear interest prior to maturity (other than upon a default in any
payment upon such a Security) or (2) the Interest Payment Date for the
Securities of any other series, but in no event less frequently than semi-
annually, and at such other times as the Trustee may request in writing a list
in such form and as of such date as the Trustee may reasonably require of the
names and addresses of Securityholders.
Section 2.08. Transfer and Exchange.
Where a Security is presented to the Registrar or a co-Registrar with a
request to register a transfer, the Registrar shall register the transfer as
requested if its requirements for such transfer are met. Where Securities are
presented to the Registrar or a co-Registrar with a request to exchange them
for an equal aggregate principal amount of Securities of the same series of
other authorized denominations, the Registrar shall make the exchange
14
<PAGE>
as requested if its requirements for such exchange are met. The Registrar shall
require, among other things, that any Security presented or surrendered for
transfer or exchange be duly endorsed, or be accompanied by appropriate
transfer documents duly executed, by the Holder thereof or his attorney duly
authorized in writing. To permit transfers and exchanges, the Trustee shall
authenticate Securities at the Registrar's request. Any exchange or transfer
shall be without charge, except that the Company may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto.
The Registrar need not transfer or exchange any Security selected for
redemption, or purchase (except, in the case of Securities to be redeemed or
purchased in part, the portion thereof not to be redeemed or purchased) or any
Security in respect of which a notice requiring the purchase or redemption
thereof by the Company at the option of the Holder has been given and not
withdrawn by the Holder thereof in accordance with the terms of such Securities
(except, in the case of Securities to be so purchased or redeemed in part, the
portion thereof not to be so purchased or redeemed) or transfer or exchange
Securities of any particular series during a period of 15 days before a
selection of Securities of such series to be redeemed.
Except as otherwise provided with respect to the Securities of any series as
contemplated by Section 2.02, a global Security may be exchanged only as
provided below in this Section.
If at any time the depositary with respect to a global Security representing
all or a portion of the Securities of or within a series notifies the Company
that it is unwilling, unable or ineligible to continue as such depositary, the
Company shall appoint a successor depositary with respect to such Securities.
Unless otherwise provided with respect to a series of Securities as
contemplated by Section 2.02, if a successor depositary is not so appointed by
the Company within 90 days after the Company receives such notice, the Company
will execute and the Trustee, upon receipt of a written order of the Company as
contemplated by Section 2.04 for the authentication and delivery of definitive
Securities of such series (or, if such written order has previously been
delivered, then upon receipt of written instructions from the person or persons
specified in such written order), will authenticate and deliver Securities of
such series in definitive form equal in aggregate principal amount to the
principal amount of the global Security or Securities representing such series
in exchange for such global Security or Securities.
The Company may at any time and in its sole discretion determine that the
Securities of any series issued in the form of one or more global Securities
shall no longer be represented by such global Security or Securities. In such
event the Company will execute and the Trustee, upon receipt of a written order
of the Company as contemplated by Section 2.04 for the authentication and
delivery of definitive Securities of such series (or, if such written order has
previously been delivered, then upon receipt of written instructions from the
person or persons specified in such written order), will authenticate and
deliver Securities of such series in definitive form equal in aggregate
principal amount to the principal amount of the global Security or Securities
representing such series in exchange for such global Security or Securities.
If a global Security is otherwise exchangeable as specified by the Company
pursuant to Section 2.02(3) with respect to a series of Securities, the
depositary with respect to a global Security representing all or a portion of
the Securities of or within such series may surrender such global Security to
the Trustee, as the Company's agent for such purpose, to be exchanged in whole
or in part for Securities of such series in definitive form in the manner and
under the circumstances so specified and on such terms as are acceptable to the
Company and such depositary. In such event, the Company shall execute and the
Trustee shall authenticate and deliver or make available for delivery:
(i) to each Person specified by such depositary a new Security or
Securities of the same series and of like tenor, of any authorized form and
denomination as requested by such Person in aggregate principal amount
equal to and in exchange for such Person's beneficial interest in the
global Security; and
(ii) unless endorsement of the surrendered global Security as
contemplated by Section 2.15 or another procedure is specified for the
Securities of such series as contemplated by Section 2.02, to such
depositary a new global Security in a denomination equal to the difference,
if any, between the principal amount of the surrendered global Security and
the aggregate principal amount of Securities delivered pursuant to clause
(i) above in exchange for beneficial interests in such surrendered global
Security.
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In any exchange provided for in any of the preceding three paragraphs, the
Company will execute and the Trustee will authenticate and deliver Securities
in definitive registered form in authorized denominations.
Upon the exchange of a global Security for Securities in definitive form,
such global Security shall be cancelled by the Trustee, unless endorsement of
the surrendered global Security as contemplated by Section 2.15 or another
procedure is specified for the Securities of such series as contemplated by
Section 2.02. Securities issued in exchange for a global Security pursuant to
this Section shall be registered in such names and in such authorized
denominations as the depositary for such global Security, pursuant to
instructions from its direct or indirect participants or otherwise, shall
instruct the Trustee. The Trustee shall deliver such Securities to the persons
in whose names such Securities are so registered.
If a Security is issued in exchange for any portion of a global Security
after the close of business at the office or agency where such exchange occurs
(i) on any Regular Record Date and before the opening of business at such
office or agency on the relevant Interest Payment Date, or (ii) on any special
record date and before the opening of business at such office or agency on the
related date for payment of defaulted interest, interest or defaulted
interest, as the case may be, will not be payable on such Interest Payment
Date or proposed date for payment, as the case may be, in respect of such
Security, but will be payable on such Interest Payment Date or proposed date
for payment, as the case may be, only to the Person to whom interest in
respect of such portion of such global Security is payable in accordance with
the provisions of this Indenture.
All securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the
Securities surrendered upon such registration of transfer or exchange.
Section 2.09. Replacement Securities.
If a mutilated Security is surrendered to the Registrar or if the Holder of
a Security claims that the Security has been lost, destroyed or wrongfully
taken, then, in the absence of notice to the Company or the Trustee that such
Security has been acquired by a bona fide purchaser, the Company shall issue
and the Trustee shall authenticate a replacement Security if the Trustee's
requirements are met. If required, such Holder shall furnish an indemnity bond
sufficient in the judgment of the Company and the Trustee to protect the
Company, the Trustee or any Agent from any loss which any of them may suffer
if a Security is replaced. The Company may charge for its expenses in
replacing a Security. Every replacement Security is an additional obligation
of the Company.
In case any such lost, destroyed or wrongfully-taken Security has become or
is about to become due and payable, or is about to be purchased by the Company
pursuant to any provision of the Securities of such series providing for the
purchase thereof at the option of the Holder or the Company, the Company in
its discretion may, instead of issuing a new Security, pay or purchase such
Security.
Section 2.10. Outstanding Securities.
Securities outstanding at any time are all Securities authenticated by the
Trustee except for those cancelled by it, those delivered to it for
cancellation and those described in this Section as not being outstanding. A
Security does not cease to be outstanding because the Company or one of its
Affiliates holds the Security.
If a Security is replaced pursuant to Section 2.09, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser.
If the Paying Agent holds on a redemption date or maturity date or on the
Business Day following a date on which Securities of such series are to be
purchased by the Company pursuant to any provision thereof providing for such
purchase at the option of the Holder or the Company, money (or securities if
permitted by the terms of such Securities) in trust or, if the Company, acting
as its own Paying Agent, sets aside and segregates
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money (or securities if permitted by the terms of such Securities) in trust,
sufficient to pay Securities payable on that date, then on and after that date
such Securities cease to be outstanding and interest, if any (and original
issue discount, if Original Issue Discount Securities) on them ceases to
accrue, unless the Trustee or the Paying Agent is restricted under Article Ten
in applying such money.
Section 2.11. Temporary Securities.
Until a permanent global Security or definitive Securities are ready for
delivery, the Company may prepare and the Trustee shall authenticate temporary
Securities. Temporary Securities of any series shall be substantially in the
form of definitive Securities of such series, but may have variations that the
Company considers appropriate for temporary Securities. Without unreasonable
delay, the Company shall prepare and the Trustee shall authenticate definitive
Securities in exchange for temporary Securities of the same series. Until so
exchanged the temporary Securities of any series shall in all respects be
entitled to the same benefits under this Indenture as definitive Securities of
such series.
Section 2.12. Cancellation.
The Company at any time may deliver Securities to the Trustee for
cancellation, including Securities authenticated which the Company has not
issued and sold. The Company, Registrar, Paying Agent and Conversion Agent
shall forward to the Trustee any Securities surrendered to them for transfer,
exchange, payment, redemption, purchase by the Company pursuant to any
provision thereof providing for such purchase at the option of the Holder, or
conversion. The Trustee and no one else shall cancel all Securities surrendered
for transfer, exchange, payment, redemption, purchase, conversion or
cancellation, and may dispose of cancelled Securities as the Company directs.
Except as otherwise provided in the resolution of the Board of Directors or
indenture supplemental hereto establishing such series as contemplated by
Section 2.02, the Company may not issue new Securities of a series to replace
Securities of the same series that it has paid or that have been delivered to
the Trustee for cancellation.
Section 2.13. Payment of Interest; Defaulted Interest.
Interest (except defaulted interest) on the Securities of any series which is
payable on any Interest Payment Date shall be paid to the persons who are
Holders of such series at the close of business on the Regular Record Date for
such interest payment. At the option of the Company, payment of interest on any
Security may be made by check mailed to the Holder's registered address.
If the Company defaults in a payment of interest on the Securities of any
series on any Interest Payment Date, it shall pay the defaulted interest to the
persons who are Securityholders of such series at the close of business on a
subsequent special record date. The Company shall fix the record date and
payment date. At least 15 days before the record date, the Company shall mail
to each Securityholder of such series a notice that states the record date, the
payment date and the amount of defaulted interest to be paid. The Company shall
notify the Trustee in writing of the amount of defaulted interest proposed to
be paid on each Security of such series and the date of the proposed payment,
and at the same time the Company shall deposit with the Paying Agent 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 Paying Agent
for such deposit prior to the date of the proposed payment. The Company may pay
defaulted interest in any other lawful manner.
Unless otherwise provided with respect to the Securities of any series as
contemplated by Section 2.02, in the case of any Security of any series which
is converted after any Regular Record Date and on or prior to the next
succeeding Interest Payment Date (other than any Security which is due and
payable prior to such Interest Payment Date), interest which is due and payable
on such Interest Payment Date shall be payable on such Interest Payment Date
notwithstanding such conversion, and such interest shall be paid to the Holder
in whose name that Security is registered at the close of business on such
Regular Record Date.
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Section 2.14. Persons Deemed Owners.
Prior to due presentment of a Security for registration of transfer, the
Company, the Trustee and any Agent may treat the person in whose name such
Security is registered as the owner of such Security for the purpose of
receiving payment of principal of and (subject to Section 2.13) interest on
such Security and for all other purposes whatsoever, and neither the Company,
the Trustee nor any Agent shall be affected by notice to the contrary.
No holder of any beneficial interest in any global Security held on its
behalf by a depositary shall have any rights under this Indenture with respect
to such global Security, and such depositary (or its nominee, if such global
Security is registered in the name of a nominee) may be treated by the Company,
the Trustee, and any Agent as the owner of such global Security for all
purposes whatsoever. None of the Company, the Trustee, or any Agent will have
any responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests of a global Security
or for maintaining, supervising or reviewing any records relating to such
beneficial ownership interests.
Notwithstanding the foregoing, with respect to any global Security, nothing
herein shall prevent the Company, the Trustee, or any Agent from giving effect
to any written certification, proxy or other authorization furnished by any
depositary, as a Holder, with respect to such global Security or impair, as
between such depositary and owners of beneficial interests in such global
Security, the operation of customary practices governing the exercise of the
rights of such depositary (or its nominee) as Holder of such global Security.
Section 2.15. Securities in Global Form.
If the Company shall establish pursuant to Section 2.02 that the Securities
of or within a series are to be issued in whole or in part in global form, then
the Company shall execute, and the Trustee shall, in accordance with Section
2.04 and the written order of the Company contemplated thereby, authenticate
and deliver one or more global Securities in temporary or permanent form that
(i) shall be registered in the name of the depositary for such global Security
or Securities or the nominee of such depositary, (ii) shall be delivered by the
Trustee to such depositary or pursuant to such depositary's instructions, and
(iii) shall bear a legend substantially to the following effect: "Unless and
until it is exchanged in whole or in part for Securities in definitive form,
this Security may not be transferred except as a whole by the depositary to a
nominee of the depositary or another nominee of the depositary or by the
depositary or any such nominee to a successor depositary or a nominee of such
successor depositary." Each depositary designated pursuant to Section 2.02 for
a global Security in registered form must be, to the extent required by
applicable law or regulation, a clearing agency registered under the Securities
Exchange Act of 1934, as amended, and any other applicable statute or
regulation, at the time of its designation and at all times that it serves as
depositary. Notwithstanding clause (14) of Section 2.02 and the provisions of
Section 2.03, any such global Security shall represent such of the outstanding
Securities of such series as shall be specified therein and may provide that it
shall represent the aggregate amount of outstanding Securities of such series
from time to time endorsed thereon and that the aggregate amount of outstanding
Securities represented thereby may from time to time be increased or decreased
to reflect exchanges. Any endorsement of a Security in a global form to reflect
the amount, or any increase or decrease in the amount, or changes in the rights
of Holders, of outstanding Securities represented thereby shall be made in such
manner and upon instructions given by such Person or Persons as shall be
specified therein or in the written order of the Company to be delivered to the
Trustee pursuant to Section 2.04. Subject to the provisions of Section 2.04
and, if applicable, Section 2.11, the Trustee shall deliver and redeliver any
Security in permanent global form in the manner and upon instructions given by
the Person or Persons specified therein or in the applicable written order of
the Company. If a written order of the Company pursuant to Section 2.04 has
been, or simultaneously is, delivered, any instructions with respect to a
Security in global form shall be in writing but need not comply with Sections
12.04 and 12.05 and need not be accompanied by an Opinion of Counsel.
The provisions of the last sentence of the third paragraph of Section 2.04
shall apply to any Security represented by a Security in global form if such
Security was never issued and sold by the Company and the
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Company delivers to the Trustee the Security in global form together with
written instructions (which need not comply with Sections 12.04 and 12.05 and
need not be accompanied by an Opinion of Counsel) with regard to the reduction
in the principal amount of Securities represented thereby, together with the
written statement contemplated by the last sentence of the third paragraph of
Section 2.04.
ARTICLE THREE
Redemption
Section 3.01. Applicability of Article.
Securities of any series which are redeemable before their stated maturity at
the election of the Company or through the operation of any sinking fund for
the retirement of Securities of such series shall be redeemable in accordance
with their terms and (except as otherwise specified as contemplated by Section
2.02 for Securities of any series) in accordance with this Article.
Section 3.02. Notices to Trustee.
If the Company elects to redeem all or less than all the Securities of any
series, it shall notify the Trustee of the redemption date, the principal
amount of Securities to be redeemed, the specific provison of the Securities
pursuant to which the Securities being called for redemption are being redeemed
and the redemption price. In the case of any redemption of Securities prior to
the expiration of any restriction on such redemption provided in the terms of
such Securities or elsewhere in this Indenture, the Company shall furnish the
Trustee with an Officers' Certificate evidencing compliance with such
restriction. If the Company wants to make any permitted optional sinking fund
payment it shall notify the Trustee of the principal amount of the Securities
to be redeemed.
The Company (1) may deliver outstanding Securities of a series (other than
any previously called for redemption) and (2) may apply as a credit Securities
of a series which (i) have been redeemed or otherwise purchased either at the
election of the Company pursuant to the terms of such Securities or through the
application of permitted optional sinking fund payments pursuant to the terms
of such Securities or (ii) have been converted pursuant to the terms of such
Securities, in each case in satisfaction of all or any part of any sinking fund
payment required to be made pursuant to the terms of the Securities of such
series as provided for by the terms of such series; provided that such
Securities have not been previously so credited. Such Securities shall be
received and credited for such purpose by the Trustee at the redemption price
specified in such Securities for redemption through operation of the sinking
fund and the amount of such sinking fund payment shall be reduced accordingly.
The Company shall notify the Trustee of its intention to so reduce the amount
of such sinking fund payment, the amount of the reduction and the basis for it.
The Company shall deliver to the Trustee with such notice any Securities to be
credited for such purpose that it has not previously delivered to the Trustee
for cancellation.
The Company shall give each notice and Officers' Certificate provided for in
this Section at least 60 days before the redemption date (unless a shorter
notice shall be satisfactory to the Trustee or is otherwise specified as
contemplated by Section 2.02 for Securities of any series).
Section 3.03. Selection of Securities to be Redeemed.
Except as otherwise specified as contemplated by Section 2.02 for Securities
of any series, if less than all the Securities of any series are to be
redeemed, the particular Securities to be redeemed shall be selected from
Securities of the same series outstanding not previously called for redemption
by such method as the Trustee considers fair and appropriate and which may
provide for the selection for redemption of portions (equal to the minimum
authorized denomination for Securities of that series or any integral multiple
thereof) of the principal amount of Securities of such series that have
denominations larger than the minimum authorized denomination for Securities of
that series. Provisions of this Indenture that apply to Securities called for
redemption also apply
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to portions of Securities called for redemption. If any Security selected for
partial redemption is converted in part after such selection but before the
termination of the conversion right with respect to the portion of the Security
so selected, the converted portion of such Security shall be deemed (so far as
may be practicable) to be the portion selected for redemption.
Section 3.04. Notice of Redemption.
At least 30 days but not more than 60 days before a redemption date (unless a
shorter notice is specified as contemplated by Section 2.02 for Securities of
any series), the Company shall mail a notice of redemption by first-class mail
to each Holder of Securities of the series to be redeemed.
The notice shall identify the Securities (and, in the case of partial
redemption, the principal amount of the Securities) to be redeemed and shall
state:
(1) the redemption date;
(2) the redemption price and method of payment, if other than in cash;
(3) if applicable, the current conversion price or rate;
(4) the name and address of the Paying Agent and, if applicable, the
Conversion Agent;
(5) if applicable, that the right of the Holder to convert Securities
called for redemption shall terminate at the close of business on the
fifteenth day prior to the redemption date (or such other day as may be
specified as contemplated by Section 2.02 for Securities of any series);
(6) if applicable, that Holders who want to convert Securities called for
redemption must satisfy the requirements for conversion contained in such
Securities;
(7) that Securities called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(8) that interest, if any (or original issue discount, if Original Issue
Discount Securities), on Securities called for redemption ceases to accrue
on and after the redemption date, unless the Company defaults in making
such redemption payment; and
(9) that the redemption is for a sinking fund or at the election of the
Company, whichever is the case.
At the Company's request, the Trustee shall give the notice of redemption in
the Company's name and at the Company's expense.
Section 3.05 Effect of Notice of Redemption.
Once notice of redemption is mailed. Securities of the series called for
redemption become due and payable on the redemption date and at the redemption
price. Upon surrender to the Paying Agent, such Securities shall be paid at the
redemption price, plus, if applicable, accrued interest, if any, to the
redemption date; provided, however, that installments of interest the Interest
Payment Date for which is on or prior to the redemption date shall be payable
to the persons who are Holders of such Securities on the relevant record dates
for such interest according to their terms and Section 2.13.
Section 3.06 Deposit of Redemption Price.
On or before the redemption date, the Company shall deposit with the Paying
Agent money (or securities if permitted by the terms of such Securities)
sufficient to pay the redemption price of, and (except if the redemption date
is an Interest Payment Date) accrued interest, if any, on, all Securities to be
redeemed on that date other than Securities or portions thereof called for
redemption on that date which are delivered by the Company to the Trustee for
cancellation. The Paying Agent shall return to the Company any money (or
securities) not required for that purpose because of conversion of Securities.
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Section 3.07 Securities Redeemed in Part.
Upon surrender of a Security that is redeemed in part, the Trustee shall
authenticate for the Holder a new Security of the same series, of any
authorized denomination requested by such Holder, equal in principal amount to
the unredeemed portion of the Security surrendered.
Section 3.08 Conversion Arrangement on Call for Redemption.
In connection with any redemption of Securities, the Company may arrange for
the purchase and conversion of any Securities called for redemption by an
agreement with one or more investment bankers or other purchasers to purchase
such Securities by paying to the Trustee in trust for the Securityholders, on
or before the close of business on the redemption date, an amount in cash not
less than the redemption price, together with interest, if any, accrued to the
redemption date, of such Securities. Notwithstanding anything to the contrary
contained in this Article Three, the obligation of the Company to pay the
redemption price of such Securities, including all accrued interest, if any,
shall be deemed to be satisfied and discharged to the extent such amount is so
paid by such purchasers. If such an agreement is entered into, any Securities
not duly surrendered for conversion by the Holders thereof may, at the option
of the Company, be deemed, to the fullest extent permitted by law, acquired by
such purchasers from such Holders and (notwithstanding anything to the contrary
contained in Article Eleven) surrendered by such purchasers for conversion, all
as of immediately prior to the close of business on the last day on which
Securities of such series called for redemption may be converted in accordance
with this Indenture and the terms of such Securities, subject to payment of the
above amount as aforesaid. The Trustee shall hold and pay to the Holders whose
Securities are selected for redemption any such amount paid to it in the same
manner as it would moneys deposited with it by the Company for the redemption
of Securities. Without the Trustee's prior written consent, no arrangement
between the Company and such purchasers for the purchase and conversion of any
Securities shall increase or otherwise affect any of the powers, duties,
responsibilities or obligations of the Trustee as set forth in this Indenture,
and the Company agrees to indemnify the Trustee from, and hold it harmless
against, any loss, liability or expense arising out of or in connection with
any such arrangement for the purchase and conversion of any Securities between
the Company and such purchasers, including the costs and expenses incurred by
the Trustee in the defense of any claim or liability arising out of or in
connection with the exercise or performance of any of its powers, duties,
responsibilities or obligations under this Indenture.
ARTICLE FOUR
Covenants
Section 4.01. Payment of Securities.
The Company shall pay the principal of and any interest on the Securities of
each series in accordance with the terms of the Securities of such series and
this Indenture.
To the extent enforceable under applicable law, the Company shall pay
interest on overdue principal at the rate borne by the Securities of such
series (unless a different rate is specified as contemplated by Section 2.02
for Securities of such series).
Section 4.02. SEC Reports.
The Company shall file with the Trustee within 15 days after it files them
with the SEC copies of the annual reports and of the information, documents and
other reports (or copies of such portions of any of the foregoing as the SEC
may by rules and regulations prescribe) which the Company is required to file
with the SEC pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934. The Company also shall comply with the other provisions of TIA (S)
314(a).
Section 4.03. Compliance Certificate.
The Company will, within 120 days after the close of each fiscal year of the
Company, commencing with the first fiscal year following the issuance of
Securities of any series under this Indenture, file with the Trustee a
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certificate of the principal executive officer, the principal financial officer
or the principal accounting officer of the Company, covering the period from
the date of issuance of such Securities to the end of the fiscal year in which
such Securities were issued, in the case of the first such certificate, and
covering the preceding fiscal year in the case of each subsequent certificate,
and stating whether or not, to the knowledge of the signer, the Company has
complied with all conditions and covenants on its part contained in this
Indenture, and, if the signer has obtained knowledge of any default by the
Company in the performance, observance or fulfillment of any such condition or
covenant specifying each such default and the nature thereof. For the purpose
of this Section 4.03, compliance shall be determined without regard to any
grace period or requirement of notice provided pursuant to the terms of this
Indenture. The certificate need not comply with Section 12.05.
Section 4.04. Corporate Existence.
Subject to the provisions of Section 5.01 hereof, the Company will do or
cause to be done all things necessary to preserve and keep in full force and
effect its corporate existence.
ARTICLE FIVE
Successor Corporation
Section 5.01. When Company May Merge, etc.
The Company shall not consolidate with or merge into, or transfer its
properties and assets substantially as an entirety to, another corporation
unless (1) the successor corporation, which shall be a corporation organized
and existing under the laws of the United States or a State thereof, assumes by
supplemental indenture all the obligations of the Company under the Securities
and this Indenture; and (2) immediately after giving effect to such
transaction, no Default or Event of Default shall have occurred and be
continuing. Thereafter, unless otherwise specified as contemplated by Section
2.02 for the Securities of any series, all such obligations of the predecessor
corporation shall terminate.
ARTICLE SIX
Defaults and Remedies
Section 6.01. Events of Default.
An "Event of Default" with respect to Securities of any series means each of
the events specified below in this Section 6.01, unless it is either
inapplicable to a particular series or is specifically deleted or modified as
contemplated by Section 2.02 for the Securities of such series, and any other
events as may be specified as contemplated by Section 2.02 for the Securities
of such series.
(1) the Company defaults in the payment of any interest on any Security
of that series when the same becomes due and payable and the default
continues for a period of 30 days;
(2) the Company defaults in the payment of the principal of any Security
of that series when the same becomes due and payable at maturity, upon
redemption (including default in the making of any mandatory sinking fund
payment), upon purchase by the Company at the option of the Holder pursuant
to the terms of such Security or otherwise;
(3) the Company fails to comply with any of its other agreements in
Securities of that series or this Indenture (other than an agreement which
has expressly been included in this Indenture solely for the benefit of
Securities of any series other than that series or is expressly made
inapplicable to the Securities of such series as contemplated by Section
2.02) and the default continues for the period and after the notice
specified below;
(4) the Company pursuant to or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case, or consents to the commencement of a
case against it,
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(B) consents to the entry of an order for relief against it in an
involuntary case,
(C) consents to the appointment of a Custodian of it or for all or
substantially all of its property, or
(D) makes a general assignment for the benefit of its creditors;
(5) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(A) is for relief against the Company in an involuntary case or
adjudicates the Company insolvent or bankrupt,
(B) appoints a Custodian of the Company for all or substantially all
of its property, or
(C) orders the winding up or liquidation of the Company, and the
order or decree remains unstayed and in effect for 90 days; or
(6) any other Event of Default provided with respect to Securities of
that series occurs.
The term "Bankruptcy Law" means Title 11, U.S. Code or any similar Federal or
State law for the relief of debtors. The term "Custodian" means any receiver,
trustee, assignee, liquidator or similar official under any Bankruptcy Law.
A Default under clause (3) is not an Event of Default until the Trustee
notifies the Company or the Holders of at least 25% in aggregate principal
amount of the outstanding Securities of that series notify the Company and the
Trustee of the Default and the Company does not cure the Default within 30 days
after receipt of the notice. The notice must specify the Default, demand that
it be remedied and state that the notice is a "Notice of Default."
Section 6.02. Acceleration.
If an Event of Default (other than an Event of Default specified in Section
6.01(4) or (5)) occurs and is continuing with respect to Securities of any
series at the time outstanding, the Trustee by notice to the Company, or the
Holders of at least 25% in aggregate principal amount of the outstanding
Securities of that series by notice to the Company and the Trustee, may declare
to be due and payable immediately (1) the principal amount (or, if the
Securities of that series are Original Issue Discount Securities, such portion
of the principal amount as may be specified in the terms of the Securities of
that series) of all of the Securities of that series then outstanding and (2)
interest, if any, accrued to the date of acceleration. Upon such declaration,
such principal amount (or specified amount) and interest, if any, shall be due
and payable immediately. If an Event of Default specified in Section 6.01(4) or
(5) occurs and is continuing, (1) the principal amount (or, if the Securities
of that series are Original Issue Discount Securities, such portion of the
principal amount as may be specified in the terms of the Securities of that
series) of all of the Securities of that series then outstanding and (2)
interest, if any, accrued to the date of such acceleration shall become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or Securityholders. The Holders of a majority in aggregate
principal amount of the outstanding Securities of the series with respect to
which an acceleration applies by notice to the Trustee may rescind an
acceleration and its consequences with respect to such series if all existing
Events of Default (other than the non-payment of the principal of and accrued
interest, if any, on Securities that have become due solely by such
acceleration) with respect to Securities of that series have been cured or
waived and if the rescission would not conflict with any judgment or decree. No
such rescission shall affect any subsequent default or impair any right
consequent thereon.
Section 6.03. Other Remedies.
If an Event of Default with respect to Securities of any series occurs and is
continuing, the Trustee may pursue any available remedy by proceeding at law or
in equity to collect the payment of the whole amount which then shall have
become due and remain unpaid for principal or interest, if any, on the
Securities of that series or to enforce the performance of any provision of the
Securities of that series or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of the
Securities of that series or does not produce any of them in the proceeding. A
delay or omission by the Trustee or any Securityholder in
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exercising any right or remedy accruing upon an Event of Default shall not
impair the right or remedy or constitute a waiver of or acquiescence in the
Event of Default. No remedy is exclusive of any other remedy. All available
remedies are cumulative.
Section 6.04. Waiver of Existing Defaults.
Subject to Section 9.02, the Holders of a majority in aggregate principal
amount of the outstanding securities of any series by notice to the Trustee may
waive on behalf of the Holders of all the Securities of such series an existing
Default or Event of Default and its consequences. When a Default or Event of
Default is waived, it is cured and stops continuing.
Section 6.05. Control by Majority.
The Holders of a majority in aggregate principal amount of the outstanding
Securities of any series may direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee or exercising any trust
or power conferred on it, with respect to the Securities of such series. The
Trustee, however, may refuse to follow any direction that conflicts with law or
this Indenture, that is unduly prejudicial to the rights of another
Securityholder or that would involve the Trustee in personal liability.
Section 6.06. Limitation on Suits.
No holder of any Security of any series shall have the right to pursue any
remedy with respect to this Indenture or the Securities unless:
(1) the Holder gives to the Trustee written notice of a continuing Event
of Default with respect to the Securities of that series;
(2) the Holders of at least 25% in aggregate principal amount of the
outstanding Securities of that series make a written request to the Trustee
to pursue the remedy;
(3) such Holder or Holders offer and provide to the Trustee indemnity
satisfactory to the Trustee against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer of indemnity; and
(5) no direction inconsistent with such written request has been given to
the Trustee during such 60-day period by the Holders of a majority in
aggregate principal amount of the outstanding Securities of such series.
A Securityholder of any series may not use this Indenture to prejudice the
rights of another Securityholder of such series or to obtain a preference or
priority over another Securityholder of such series, except in the manner
herein provided and for the equal and ratable benefit of all Securityholders of
such series.
Section 6.07. Rights of Holders to Receive Payment and to Convert.
Subject to Article Ten and notwithstanding any other provision of this
Indenture, the right of any Holder of a Security to receive payment of
principal of and (subject to Section 2.13) interest, if any, on the Security,
on or after the respective due dates with respect to such payments expressed in
such Security, and, if applicable, to convert such Security on the terms and
subject to the conditions applicable to Securities of such series, or to bring
suit for the enforcement of any such payment on or after such respective dates
or of such right to convert, if any, shall not be impaired or affected without
the consent of the Holder.
Section 6.08. Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(1) or (2) occurs and is
continuing with respect to the Securities of any series, the Trustee may
recover judgment in its own name and as trustee of an express trust
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against the Company for the whole amount which then shall have become due and
remain unpaid for principal and interest, if any, on the Securities of such
series.
Section 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or documents as
may be necessary or advisable in order to have the claims of the Trustee and
the Securityholders allowed in any judicial proceedings relative to the
Company, its creditors or its property and to collect and receive money,
property or securities payable or deliverable on any such claims and distribute
the same.
Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article, it shall pay out
the money in the following order:
First: to the Trustee for amounts due under Section 7.07;
Second: to holders of Senior Debt to the extent required by Article Ten;
Third: to the payment of amounts due and unpaid for principal and
interest, if any, on the Securities in respect of which such money has been
collected, ratably, without preference or priority of any kind, according
to the amounts which then shall have become due and payable on such
Securities for principal and interest, respectively; and
Fourth: to the Company.
The Trustee may fix a record date and payment date for any payment to
Securityholders pursuant to this Section, notice of which shall be mailed to
each Securityholder by the Company at least 15 days before such record date.
Section 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this Indenture
or in any suit against the Trustee for any action taken or omitted by it as
Trustee, a court in its discretion may require the filing by any party litigant
in the suit of an undertaking to pay the costs of the suit, and the court in
its discretion may assess reasonable costs, including reasonable attorneys'
fees, against any party litigant in the suit, having due regard to the merits
and good faith of the claims or defenses made by the party litigant. This
Section does not apply to a suit by the Trustee, a suit by a Holder pursuant to
Section 6.07 or a suit by Holders of more than 10% in aggregate principal
amount of the outstanding Securities of any series.
ARTICLE SEVEN
Trustee
Section 7.01. Duties of Trustee.
(a) If an Event of Default with respect to Securities of any series has
occurred and is continuing, the Trustee shall with respect to such series
exercise such of the rights and powers vested in it by this Indenture with
respect to such series and use the same degree of care and skill in their
exercise as a prudent man would exercise or use under the circumstances in the
conduct of his own affairs.
(b) With respect to Securities of any series, except during the continuance
of an Event of Default with respect to Securities of such series:
(1) The Trustee need perform only those duties that are specifically set
forth in this Indenture or the TIA and no others.
(2) In the absence of bad faith on its part, the Trustee may conclusively
rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon certificates or opinions furnished to
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the Trustee and conforming to the requirements of this Indenture. The
Trustee, however, shall examine the certificates and opinions to determine
whether or not they conform to the requirements of this Indenture.
(c) The Trustee may not be relieved from liability for its own negligent
action, its own negligent failure to act or its own willful misconduct, except
that:
(1) This paragraph does not limit the effect of paragraph (b) of this
Section.
(2) The Trustee shall not be liable for any error of judgment made in
good faith by a Trust Officer, unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts.
(3) The Trustee shall not be liable with respect to any action it takes
or omits to take in good faith in accordance with a direction received by
it pursuant to Section 6.05.
(d) Every provision of this Indenture that in any way relates to the Trustee
is subject to paragraphs (a), (b) and (c) of this Section.
(e) The Trustee may refuse to perform any duty or exercise any right or power
unless it receives indemnity satisfactory to it against any loss, liability or
expense.
(f) The Trustee shall not be liable for interest on any money received by it
except as the Trustee may agree with the Company. Money held in trust by the
Trustee need not be segregated from other funds except to the extent required
by law.
Section 7.02. Rights of Trustee.
(a) The Trustee may rely on any document believed by it to be genuine and to
have been signed or presented by the proper person. The Trustee need not
investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may consult with
counsel or require an Officers' Certificate, an Opinion of Counsel, and/or an
accountant's certificate. The Trustee shall not be liable for any action it
takes or omits to take in good faith in reliance on the Certificate, Opinion or
accountant's certificate.
(c) The Trustee may act through agents and counsel and shall not be
responsible for the misconduct or negligence of any agent or counsel appointed
with due care.
(d) The Trustee shall not be liable for any action it takes or omits to take
in good faith which it believes to be authorized or within its rights or
powers.
Section 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the owner or
pledgee of Securities and may otherwise deal with the Company or its Affiliates
with the same rights it would have if it were not Trustee. Any Agent may do the
same with like rights. The Trustee, however, must comply with Sections 7.10 and
7.11.
Section 7.04. Trustee's Disclaimer.
The Trustee makes no representations as to the validity or adequacy of this
Indenture or the Securities; it shall not be accountable for the Company's use
of the proceeds from the Securities; and it shall not be responsible for any
statement in the Indenture or the Securities other than its certificate of
authentication.
Section 7.05. Notice of Defaults.
If a Default occurs and is continuing with respect to Securities of any
series and if it is known to a Trust Officer of the Trustee, the Trustee shall
mail to each Securityholder of such series notice of the Default within 90 days
after it occurs or as soon as reasonably practicable thereafter. Except in the
case of a default in payment
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of principal of or interest on any Security of such series (including default
in the making of any mandatory sinking fund or mandatory repurchase payment),
the Trustee may withhold the notice if and so long as a committee of its Trust
Officers in good faith determines that withholding the notice is in the
interests of Securityholders of such series.
Section 7.06. Reports by Trustee to Holders.
Within 60 days after each April 15 beginning with the April 15 following the
date on which Securities are originally issued under this Indenture, the
Trustee shall mail to each Securityholder a brief report dated as of such April
15 that complies with TIA (S) 313(a), if required by said Section. The Trustee
also shall comply with TIA (S) 313(b).
A copy of each report at the time of its mailing to Securityholders shall be
filed by the Company with the SEC and each stock exchange on which the
Securities are listed.
The Company will notify the Trustee if and when the Securities are listed on
any stock exchange.
Section 7.07. Compensation and Indemnity.
The Company shall pay to the Trustee from time to time reasonable
compensation for its services. The Trustee's compensation shall not be limited
by any law on compensation of a trustee of an express trust. The Company shall
reimburse the Trustee upon request for all reasonable out-of-pocket expenses
incurred by it. Such expenses shall include the reasonable compensation and
expenses of the Trustee's agents and counsel.
The Company shall indemnify the Trustee against any loss or liability
incurred by it arising out of or in connection with the acceptance or
administration of this trust and its duties hereunder. The Trustee shall notify
the Company promptly of any claim asserted against the Trustee for which it may
seek indemnity. Failure of the Trustee to so notify the Company shall not
relieve the Company of its obligations hereunder. The Company shall have the
right to elect to defend the claim and the Trustee shall cooperate in the
defense. The Trustee may have separate counsel and the Company shall pay the
reasonable fees and expenses of such counsel. The Company need not pay for any
settlement made without its written consent, which consent shall not be
unreasonably withheld. The Company need not reimburse any expense or indemnify
against any loss or liability incurred by the Trustee through negligence or bad
faith.
To secure the Company's payment obligations in this Section, the Trustee
shall have a lien prior to the Securities on all money or property held or
collected by the Trustee, except that held in trust to pay principal of or
interest on particular Securities.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(4) or (5) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
Section 7.08. Replacement of Trustee.
The Trustee may resign at any time with respect to Securities of one or more
series by so notifying the Company. The Holders of a majority in aggregate
principal amount of the outstanding Securities of any series may remove the
Trustee with respect to the Securities of such series by so notifying the
removed Trustee and may appoint a successor Trustee with the Company's consent.
The Company shall remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a receiver or other public officer takes charge of the Trustee or its
property; or
(4) the Trustee becomes incapable of acting.
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If the Trustee resigns or is removed, or if a vacancy exists in the office of
Trustee for any reason, with respect to the Securities of one or more series,
the Company shall promptly appoint a successor Trustee or Trustees (it being
understood that any such successor Trustee may be appointed with respect to the
Securities of one or more or all of such series and that at any time there
shall be only one Trustee with respect to the Securities of any particular
series).
A successor Trustee shall deliver a written acceptance of its appointment to
the retiring Trustee and to the Company. Immediately after that, the retiring
Trustee shall transfer all property held by it as Trustee to the successor
Trustee (subject to its lien, if any, provided for in Section 7.07), the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. A successor Trustee shall mail notice of its succession
to each Securityholder.
If a successor Trustee with respect to Securities of any series does not take
office within 60 days after the retiring Trustee resigns or is removed, the
retiring Trustee, the Company or the Holders of a majority in aggregate
principal amount of the outstanding Securities of such series may petition any
court of competent jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder may
petition any court of competent jurisdiction for the removal of the Trustee
with respect to all Securities and the appointment of a successor Trustee.
Section 7.09. Successor Trustee by Merger, etc.
If the Trustee consolidates with, merges or converts into, or transfers all
or substantially all of its corporate trust assets to, another corporation or
national banking association, the successor corporation or national banking
association without any further act shall be the successor Trustee.
Section 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the requirements of
TIA (S) 310(a). The Trustee shall always have a combined capital and surplus of
at least $50,000,000 as set forth in its most recent published annual report of
condition. With respect to the Securities of each series, the Trustee shall
comply with TIA (S) 310(b) and in determining whether the Trustee has a
conflicting interest as defined in TIA (S) 310(b) with respect to the
Securities of any series, there shall be excluded this Indenture with respect
to the Securities of any series other than such series. Nothing herein shall
prevent the Trustee from filing with the SEC the application referred to in the
second to last paragraph of TIA (S) 310(b).
Section 7.11. Preferential Collection of Claims Against Company.
The Trustee shall comply with TIA (S) 311(a), excluding any creditor
relationship listed in TIA (S) 311(b). A Trustee who has resigned or been
removed shall be subject to TIA (S) 311(a) to the extent indicated.
ARTICLE EIGHT
Discharge of Indenture
Section 8.01. Termination of Company's Obligations.
The Company may terminate all of its obligations under the Securities of any
series and this Indenture with respect to the Securities of such series if
either (1) all Securities of such series previously authenticated and delivered
(other than destroyed, lost or stolen Securities which have been replaced or
paid or Securities for whose payment money (or, if permitted by the terms of
such Securities, securities) has theretofore been held in trust and thereafter
repaid to the Company, as provided in Section 8.03) have been delivered to the
Trustee for cancellation; or (2) the Company irrevocably deposits in trust with
the Trustee money or U.S. Government
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Obligations sufficient to pay the principal of and interest, if any, on all
Securities of such series not theretofore cancelled or delivered to the Trustee
for cancellation (other than destroyed, lost or stolen Securities which have
been replaced or paid or Securities for whose payment money (or, if permitted
by the terms of such Securities, securities) has theretofore been held in trust
and thereafter repaid to the Company, as provided in Section 8.03) to maturity
or redemption, as the case may be.
The Company's obligations in Sections 2.05, 2.06, 2.07, 2.08, 2.09, 4.01,
7.07, 7.08 and 8.03 and Article Eleven of this Indenture, however, shall
survive until the Securities of such series are no longer outstanding.
Thereafter the Company's obligations in Sections 7.07 and 8.03 shall survive.
Notwithstanding the satisfaction and discharge of this Indenture with respect
to the Securities of any series, if money or U.S. Government Obligations shall
have been deposited with the Trustee pursuant to clause (2) of this Section,
the obligations of the Trustee under Section 8.02 and the second sentence of
Section 8.03 shall survive.
After a deposit and if all other conditions thereto are met, the Trustee for
the Securities of such series shall be required to execute an instrument
acknowledging satisfaction and discharge of this Indenture with respect to such
Securities, except for those surviving obligations specified above; provided,
however, that the Trustee shall not be required to execute such instrument
until the expiration of ninety days after the date of a deposit and that such
instrument may be made subject to the condition that such deposit had been made
prior to the happening of any event specified in Section 10.02.
In order to have money available on a payment date to pay the principal of or
interest, if any, on the Securities, the U.S. Government Obligations shall be
payable as to principal or interest on or before such payment date in such
amounts as will provide the necessary money. U.S. Government Obligations shall
not be callable at the issuer's option.
Section 8.02. Application of Trust Fund.
The Trustee shall hold in trust money and U.S. Government Obligations
deposited with it pursuant to Section 8.01. Subject to Section 10.07, it shall
apply the deposited money and the money from the U.S. Government Obligations
through the Paying Agent and in accordance with the provisions of the
Securities and this Indenture to the payment of principal of and interest, if
any, on the Securities for the payment of which such money or U.S. Government
Obligations has been deposited with the Trustee.
Section 8.03. Repayment to Company.
The Trustee and the Paying Agent shall promptly pay to the Company upon
written request any excess money or securities held by them at any time. The
Trustee and the Paying Agent shall pay to the Company upon written request any
money or securities held by them for the payment of principal or interest, if
any, that remains unclaimed for two years. After that, Holders entitled to the
money or securities must look to the Company for payment unless an applicable
abandoned property law designates another person.
ARTICLE NINE
Amendments, Supplements and Waivers
Section 9.01. Without Consent of Holders.
The Company and the Trustee may amend or supplement this Indenture or the
Securities of any series without notice to or consent of any Securityholder:
(1) to cure any ambiguity, defect or inconsistency;
(2) to comply with Sections 5.01 and 11.16;
(3) to establish the form or terms of Securities of any series as
permitted by Sections 2.01 and 2.02;
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(4) to add to the covenants of the Company for the benefit of the Holders
of all or any series of Securities (and if such covenants are to be for the
benefit of less than all series of Securities, stating that such covenants
are expressly being included solely for the benefit of such series) or to
surrender any right or power herein conferred upon the Company;
(5) to add any additional Events of Default (and if such Events of
Default are to be applicable to less than all series of Securities, stating
that such Events of Default are expressly being included solely to be
applicable to such series);
(6) to change or eliminate any of the provisions of this Indenture,
provided that, except as otherwise contemplated by Section 2.02(13), any
such change or elimination shall become effective only when there is no
Security outstanding of any series created prior thereto which is entitled
to the benefit of such provision;
(7) to add or change any of the provisions of this Indenture to such
extent as shall be necessary to permit or facilitate the issuance of
Securities in bearer form, registrable or not registrable as to principal,
and with or without interest coupons, or to provide for uncertificated
Securities in addition to certificated Securities (so long as any
"registration-required obligation" within the meaning of Section 163(f)(2)
of the Internal Revenue Code of 1986, as amended (the "Code") is in
registered form for purposes of the Code):
(8) to make any change that in the opinion of the Board of Directors,
does not materially adversely affect the rights of any Securityholder; or
(9) to comply with any requirement of the SEC in connection with the
qualification of this Indenture under the TIA.
Section 9.02. With Consent of Holders.
The Company and the Trustee may amend or supplement this Indenture or the
Securities of any series without notice to any Securityholder but with the
written consent of the Holders of a majority in aggregate principal amount of
the outstanding Securities of each series affected by such amendment or
supplement. The Holders of a majority in aggregate principal amount of the
outstanding Securities of any series may on behalf of the Holders of all
Securities of such series waive compliance by the Company with any provision of
this Indenture or of Securities of such series without notice to any
Securityholder. Without the consent of each Securityholder affected, however,
an amendment, supplement or waiver, including a waiver pursuant to Section
6.04. may not:
(1) reduce the amount of Securities of any series whose Holders must
consent to an amendment, supplement or waiver;
(2) reduce the rate of or extend the time for payment of interest on any
Security (or, in the case of an Original Issue Discount Security, reduce
the rate of accrual of original issue discount);
(3) reduce the principal of (or any premium payable upon the redemption
of) or extend the fixed maturity of any Security (or, in the case of an
Original Issue Discount Security, reduce the portion of the principal
amount that would be due and payable upon acceleration of the maturity
thereof pursuant to Section 6.02);
(4) change the amount or time of any payment required by any sinking fund
provisions of the Securities of any series;
(5) make any change that materially adversely affects the rights of a
Holder to require the Company to purchase a Security in accordance with the
terms thereof and this Indenture;
(6) waive a default in the payment of the principal of or interest, if
any, on any Security;
(7) make any Security payable in money or securities other than that
stated in the Security; or
(8) make any change that materially adversely affects the right to
convert any Security or that increases the conversion price or reduces the
conversion rate of any Security.
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It shall not be necessary for the consent of the Holders under this Section
to approve the particular form of any proposed supplement, but it shall be
sufficient if such consent approves the substance thereof.
Section 9.03. Compliance with Trust Indenture Act.
Every amendment to or supplement of this Indenture or the Securities shall
comply with the TIA as then in effect.
Section 9.04. Revocation and Effect of Consents.
A consent to an amendment, supplement, waiver or other action by a Holder of
a Security shall bind the Holder and every subsequent Holder of a Security or
portion of a Security that evidences the same debt as the consenting Holder's
Security, even if notation of the consent is not made on any Security. Any such
Holder or subsequent Holder, however, may revoke the consent as to his Security
or portion of a Security. Such revocation shall be effective only if the
Trustee receives the notice of revocation before the date the amendment,
supplement, waiver or other action becomes effective. An amendment, supplement,
waiver or other action shall become effective on receipt by the Trustee of
written consents from the Holders of the requisite percentage in aggregate
principal amount of the outstanding Securities of the relevant series. After an
amendment, supplement or waiver becomes effective, it shall bind every
Securityholder of each series of Securities so affected.
Section 9.05. Notation on or Exchange of Securities.
If an amendment, supplement or waiver changes the terms of a Security, the
Trustee may require the Holder of the Security to deliver it to the Trustee.
The Trustee may place an appropriate notation on the Security about the changed
terms and return it to the Holder. Alternatively, if the Company or the Trustee
so determines, the Company in exchange for the Security shall issue and the
Trustee shall authenticate a new Security that reflects the changed terms.
Section 9.06. Trustee to Sign Amendments, etc.
The Trustee shall sign any amendment, supplement or waiver authorized
pursuant to this Article if the amendment, supplement or waiver does not
adversely affect the rights, duties, immunities or liabilities of the Trustee.
If it does, the Trustee may but need not sign it. The Company may not sign an
amendment or supplement until the Board of Directors approves it.
ARTICLE TEN
Subordination
Section 10.01. Securities Subordinated to Senior Debt.
The Company agrees, and each holder of the Securities by his acceptance
thereof likewise agrees, that the payment of the principal of and interest, if
any, on the Securities is subordinated, to the extent and in the manner
provided in this Article, to the prior payment in full of all Senior Debt.
Senior Debt means the principal of and interest on Debt of the Company
outstanding at any time other than (i) the Securities, and (ii) Debt which by
its terms is not superior in right of payment to the Securities. "Debt" of any
person means:
(1) any indebtedness of such person (i) for borrowed money or (ii)
evidenced by a note, debenture or similar instrument (including a purchase
money obligation) given in connection with the acquisition of any property
or assets, including securities;
(2) any guarantee by such person of any indebtedness of others described
in the preceding clause (1); and
(3) any amendment, renewal, extension or refunding of any such
indebtedness or guarantee.
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This Article shall constitute a continuing offer to all persons who, in
reliance upon such provisions, become holders of, or continue to hold, Senior
Debt, and such provisions are made for the benefit of the holders of Senior
Debt, and such holders are made obligees hereunder and they and/or each of them
may enforce such provisions.
Section 10.02. Company Not to Make Payments with Respect to Securities in
Certain Circumstances.
(a) Upon the maturity of any Senior Debt by lapse of time, acceleration or
otherwise, all principal thereof and interest thereon shall first be paid in
full, or such payment duly provided for in cash or in a manner satisfactory to
the holders of such Senior Debt, before any payment is made on account of the
principal of or interest on the Securities or to acquire any of the Securities
or on account of any sinking fund provisions of the Securities (except payments
made in capital stock of the Company or in warrants, rights or options to
purchase or acquire capital stock of the Company, sinking fund payments made in
Securities acquired by the Company before the maturity of such Senior Debt, and
payments made through the exchange of other debt obligations of the Company for
such Securities in accordance with the terms of such Securities, provided that
such debt obligations are subordinated to Senior Debt at least to the extent
that the Securities for which they are exchanged are so subordinated pursuant
to this Article Ten).
(b) Upon the happening of any default in payment of the principal of or
interest on any Senior Debt when the same becomes due and payable, then, unless
and until such default shall have been cured or waived or shall have ceased to
exist, no payment shall be made by the Company with respect to the principal of
or interest on the Securities or to acquire any of the Securities or on account
of any sinking fund provisions of the Securities (except payments made in
capital stock of the Company or in warrants, rights or options to purchase or
acquire capital stock of the Company, sinking fund payments made in Securities
acquired by the Company before such default and notice thereof, and payments
made through the exchange of other debt obligations of the Company for such
Securities in accordance with the terms of such Securities, provided that such
debt obligations are subordinated to Senior Debt at least to the extent that
the Securities for which they are exchanged are so subordinated pursuant to
this Article Ten).
(c) In the event that notwithstanding the provisions of this Section 10.02
the Company shall make any payment to the Trustee on account of the principal
of or interest on the Securities, or on account of any sinking fund provisions
of the Securities, after the maturity of any Senior Debt as described in
Section 10.02(a) above or after the happening of a default in payment of the
principal of or interest on any Senior Debt as described in Section 10.02(b)
above, then, unless and until all Senior Debt which shall have matured, and all
interest thereon, shall have been paid in full (or the declaration of
acceleration thereof shall have been rescinded or annulled), or such default
shall have been cured or waived or shall have ceased to exist, such payment
(subject to the provisions of Sections 10.06 and 10.07) shall be held by the
Trustee, in trust for the benefit of, and shall be paid forthwith over and
delivered to, the holders of such Senior Debt (pro rata as to each of such
holders on the basis of the respective amounts of Senior Debt held by them) or
their representative or the trustee under the indenture or other agreement (if
any) pursuant to which such Senior Debt may have been issued, as their
respective interests may appear, for application to the payment of all such
Senior Debt remaining unpaid to the extent necessary to pay the same in full in
accordance with its terms, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Debt. The Company shall give
prompt written notice to the Trustee of any default in the payment of principal
of or interest on any Senior Debt.
Section 10.03. Securities Subordinated to Prior Payment of All Senior Debt on
Dissolution, Liquidation or Reorganization of Company.
Upon any distribution of assets of the Company in any dissolution, winding
up, liquidation or reorganization of the Company (whether in bankruptcy,
insolvency or receivership proceedings or upon an assignment for the benefit of
creditors or otherwise):
(a) the holders of all Senior Debt shall first be entitled to receive
payments in full of the principal thereof and interest due thereon before
the Holders of the Securities are entitled to receive any payment on
account of the principal of or interest on the Securities;
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(b) any payment or distribution of assets of the Company of any kind or
character, whether in cash, property or securities (other than securities
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 the payment of which is subordinate, at least to the extent
provided in this Article Ten with respect to the Securities, to the payment
in full without diminution or modification by such plan of all Senior
Debt), to which the Holders of the Securities or the Trustee on behalf of
the Holders of the Securities would be entitled except for the provisions
of this Article Ten, shall be paid by the liquidating trustee or agent or
other person making such payment or distribution directly to the holders of
Senior Debt or their representative, or to the trustee under any indenture
under which Senior Debt may have been issued (pro rata as to each such
holder, representative or trustee on the basis of the respective amounts of
unpaid Senior Debt held or represented by each), to the extent necessary to
make payment in full of all Senior Debt remaining unpaid, after giving
effect to any concurrent payment or distribution or provision therefor to
the holders of such Senior Debt; and
(c) in the event that notwithstanding the foregoing provisions of this
Section 10.03, any payment or distribution of assets of the Company of any
kind or character, whether in cash, property or securities (other than
securities 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 the payment of which is subordinate, at least to the extent
provided in this Article Ten with respect to the Securities, to the payment
in full without diminution or modification by such plan of all Senior
Debt), shall be received by the Trustee or the Holders of the Securities on
account of principal of or interest on the Securities before all Senior
Debt is paid in full, or effective provision made for its payment, such
payment or distribution (subject to the provisions of Sections 10.06 and
10.07) shall be received and held in trust for and shall be paid over to
the holders of the Senior Debt remaining unpaid or unprovided for or their
representative, or to the trustee under any indenture under which such
Senior Debt may have been issued (pro rata as provided in subsection (b)
above), for application to the payment of such Senior Debt until all such
Senior Debt shall have been paid in full, after giving effect to any
concurrent payment or distribution or provision therefor to the holders of
such Senior Debt.
The Company shall give prompt written notice to the Trustee of any
dissolution, winding up, liquidation or reorganization of the Company.
Section 10.04. Securityholders to be Subrogated to Right of Holders of Senior
Debt.
Subject to the payment in full of all Senior Debt, the Holders of the
Securities shall be subrogated equally and ratably to the rights of the holders
of Senior Debt to receive payments or distributions of assets of the Company
applicable to the Senior Debt until all amounts owing on the Securities shall
be paid in full, and for the purpose of such subrogation no payments or
distributions to the holders of the Senior Debt by or on behalf of the Company
or by or on behalf of the Holders of the Securities by virtue of this Article
Ten which otherwise would have been made to the Holders of the Securities
shall, as between the Company, its creditors other than holders of Senior Debt
and the Holders of the Securities, be deemed to be payment by the Company to or
on account of the Senior Debt, it being understood that the provisions of this
Article Ten are and are intended solely for the purpose of defining the
relative rights of the Holders of the Securities, on the one hand, and the
holders of the Senior Debt, on the other hand.
Section 10.05. Obligation of the Company Unconditional.
Nothing contained in this Article Ten or elsewhere in this Indenture or in
any Security is intended to or shall impair, as between the Company, its
creditors other than holders of Senior Debt and the Holders of the Securities,
the obligation of the Company, which is absolute and unconditional, to pay to
the holders of the Securities the principal of and interest on the Securities
as and when the same shall become due and payable in accordance with their
terms, or is intended to or shall affect the relative rights of the Holders of
the Securities and creditors of the Company other than the holders of the
Senior Debt, nor shall anything herein or therein
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prevent the Trustee or the Holder of any Security from exercising all remedies
otherwise permitted by applicable law upon default under this Indenture,
subject to the rights, if any, under this Article Ten of the holders of Senior
Debt in respect of cash, property or securities of the Company received upon
the exercise of any such remedy. Upon any payment or distribution of assets of
the Company referred to in this Article Ten, the Trustee and the Holders of the
Securities shall be entitled to rely upon any order or decree made by any court
of competent jurisdiction in which such dissolution, winding up, liquidation or
reorganization proceedings are pending, or, subject to the provisions of
Sections 7.01 and 7.02, a certificate of the receiver, trustee in bankruptcy,
liquidating trustee or agent or other person making such payment or
distribution to the Trustee or the Holders of the Securities, for the purpose
of ascertaining the persons entitled to participate in such 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 Ten.
Nothing contained in this Article Ten or elsewhere in this Indenture or in
any Security is intended to or shall affect the obligation of the Company to
make, or prevent the Company from making, at any time except during the
pendency of any dissolution, winding up, liquidation or reorganization
proceeding, and except as provided in subsections (a) and (b) of Section 10.02,
payments at any time of the principal of or interest on the Securities.
Section 10.06. Trustee Entitled to Assume Payments Not Prohibited in Absence of
Notice.
The Trustee shall not at any time be charged with knowledge of the existence
of any facts which would prohibit the making of any payment to or by the
Trustee, unless at least two Business Days prior to the making of any such
payment, the Trustee shall have received written notice thereof from the
Company or from one or more holders of Senior Debt or from any representative
thereof or from any trustee therefor, together with proof satisfactory to the
Trustee of such holding of Senior Debt or of the authority of such
representative or trustee; and, prior to the receipt of any such written
notice, the Trustee, subject to the provisions of Sections 7.01 and 7.02 shall
be entitled to assume conclusively that no such facts exist. The Trustee shall
be entitled to rely on the delivery to it of a written notice by a person
representing himself to be a holder of Senior Debt (or a representative or
trustee on behalf of such holder) to establish that such notice has been given
by a holder of Senior Debt or a representative of or trustee on behalf of any
such holder. In the event that the Trustee determines, in good faith, that
further evidence is required with respect to the right of any person as a
holder of Senior Debt to participate in any payments or distribution pursuant
to this Article Ten, the Trustee may request such person to furnish evidence to
the reasonable satisfaction of the Trustee as to the amount of Senior Debt held
by such person, as to the extent to which such person is entitled to
participate in such payment or distribution, and as to other facts pertinent to
the rights of such person under this Article Ten, and if such evidence is not
furnished, the Trustee may defer any payment to such person pending judicial
determination as to the right of such person to receive such payment. The
Trustee, however, shall not be deemed to owe any fiduciary duty to the holders
of Senior Debt and nothing in this Article Ten shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 7.07.
Section 10.07. Application by Trustee of Monies or U.S. Government Obligations
Deposited with It.
Money or U.S. Government Obligations deposited in trust with the Trustee
pursuant to and in accordance with Section 8.01 shall be for the sole benefit
of Securityholders and, to the extent allocated for the payment of Securities,
shall not be subject to the subordination provisions of this Article Ten, if
the same are deposited in trust prior to the happening of any event specified
in Section 10.02. Otherwise, any deposit of monies or U.S. Government
Obligations by the Company with the Trustee or any Paying Agent (whether or not
in trust) for the payment of the principal of or interest on any Securities
shall be subject to the provisions of Sections 10.01, 10.02 and 10.03 except
that, if prior to the date on which by the terms of this Indenture any such
monies may become payable for any purpose (including, without limitation, the
payment of the principal of or the interest, if any, on any Security) the
Trustee shall not have received with respect to such monies the notice provided
for in Section 10.06, then the Trustee or the Paying Agent shall have full
power and authority to receive such monies and U.S. Government Obligations and
to apply the same to the purpose for which they were received, and shall not be
affected by any notice to the contrary which may be received by it on or after
such date. This Section
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10.07 shall be construed solely for the benefit of the Trustee and Paying Agent
and, as to the first sentence hereof, the Securityholders, and shall not
otherwise affect the rights of holders of Senior Debt.
Section 10.08. Subordination Rights Not Impaired by Acts or Omissions of
Company or Holders of Senior Debt.
No right of any present or future holders of any Senior Debt to enforce
subordination as provided herein 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 of this Indenture, regardless of any knowledge
thereof which any such holder may have or be otherwise charged with.
Section 10.09. Securityholders Authorize Trustee to Effectuate Subordination of
Securities.
Each Holder of the Securities by his acceptance thereof authorizes and
expressly directs the Trustee on his behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in this
Article Ten and appoints the Trustee his attorney-in-fact for such purpose,
including, in the event of any dissolution, winding up, liquidation or
reorganization of the Company (whether in bankruptcy, insolvency or
receivership proceedings or upon an assignment for the benefit of creditors or
otherwise) tending towards liquidation of the business and assets of the
Company, the immediate filing of a claim for the unpaid balance of his
Securities in the form required in said proceedings and causing said claim to
be approved. If the Trustee does not file a proper claim or proof of debt in
the form required in such proceeding prior to 30 days before the expiration of
the time to file such claim or claims, then the holders of Senior Debt have the
right to file and are hereby authorized to file an appropriate claim for and on
behalf of the Holders of said Securities.
Section 10.10. Right of Trustee to Hold Senior Debt.
The Trustee shall be entitled to all of the rights set forth in this Article
Ten in respect of any Senior Debt at any time held by it to the same extent as
any other holder of Senior Debt, and nothing in this Indenture shall be
construed to deprive the Trustee of any of its rights as such holder.
Section 10.11. Article Ten Not to Prevent Events of Default.
The failure to make a payment on account of principal or interest by reason
of any provision in this Article Ten shall not be construed as preventing the
occurrence of an Event of Default under Section 6.01.
ARTICLE ELEVEN
Conversion
Section 11.01. Applicability of Article.
Securities of any series which are convertible into Parent Stock at the
option of the Holder shall be convertible in accordance with their terms and
(except as otherwise specified as contemplated by Section 2.02 for Securities
of any series) in accordance with this Article. Each reference in this Article
to "a Security" or "the Securities" refers to the Securities of the particular
series that is convertible into Parent Stock. If more than one series of
Securities with conversion privileges are outstanding at any time, the
provisions of this Article shall be applied separately to each such series.
Section 11.02. Conversion Privilege.
A Holder of a Security of any authorized denomination of any series may
convert it into Parent Stock, at any time during the period specified on the
Securities of that series, at the conversion price or conversion rate in effect
on the conversion date, except that, with respect to any to any Security (or
portion thereof) called for
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redemption, such right shall (except as otherwise provided in Section 3.08)
terminate at the close of business on the fifteenth day prior to the date fixed
for redemption of such Security (or portion thereof) (or such other day as may
be specified as contemplated by Section 2.02 for Securities of such series),
unless the Company shall default in payment of the amount due upon redemption
thereof.
The initial conversion price or conversion or rate in respect of a series of
Securities shall be as specified on the Securities of that series. The
conversion price or conversion rate will be subject to adjustment on the terms
set forth in Sections 11.07 through 11.13 or such other or different terms, if
any, as may be specified as contemplated by Section 2.02 for Securities of such
series.
A Holder may convert any Security in full and may convert a portion of a
Security if the portion to be converted and the remaining portion of such
Security are in denominations issuable for that series of Securities.
Provisions of this Indenture that apply to conversion of all of a Security also
apply to conversion of a portion of it.
Section 11.03. Conversion Procedure.
To convert a Security of any series, a Holder must satisfy the requirements
for conversion contained on the Securities of that series. The date on which
the Holder satisfies all those requirements is the conversion date. As soon as
practicable after the conversion date, the Company shall deliver to the Holder
through the Conversion Agent a certificate for the number of shares of Parent
Stock deliverable upon the conversion and cash or its check in lieu of any
fractional share. The person in whose name the certificate is registered
becomes a stockholder of record on the conversion date and the rights of the
Holder of the Securities so converted as a Holder thereof cease as of such
date.
If the Holder converts more than one Security of any series at the same time,
the number of full shares issuable upon the conversion shall be based on the
total principal amount of the Securities of such series so converted.
Upon surrender of a Security of any series that is converted in part, the
Trustee shall authenticate for the Holder a new Security of that series equal
in principal amount to the unconverted portion of the Security surrendered.
If the last day on which a Security may be converted is a Legal Holiday in a
place where a Conversion Agent is located, the Security may be surrendered to
that Conversion Agent on the next succeeding day that is not a Legal Holiday.
The Company will not be required to deliver certificates for shares of Parent
Stock upon conversion while the Parent's stock transfer books are closed for a
meeting of stockholders or for the payment of dividends or for any other
purpose, but certificates for shares of Parent Stock shall be delivered as soon
as the stock transfer books shall again be opened.
Securities of any series surrendered for conversion during the period from
the close of business of any Regular Record Date next preceding any Interest
Payment Date for such series to the opening of business on such Interest
Payment Date shall (except in the case of Securities or portions thereof which
have been called for redemption on a redemption date within such period) be
accompanied by payment in funds acceptable to the Company of an amount equal to
the interest payable in such Interest Payment Date on the principal amount of
Securities being surrendered for conversion; provided, that no such payment
need be made if there shall exist, at the time of conversion, a default in the
payment of interest on the Securities of such series. The funds so delivered to
the Conversion Agent shall be paid to the Company on or after such Interest
Payment Date unless the Company shall default on the payment of the interest
due on such Interest Payment Date, in which event such funds shall be paid to
the Holder who delivered the same. Except as provided in the preceding sentence
and subject to the last paragraph of Section 2.13, no payment or adjustment
shall be made upon any conversion on account of any interest accrued on the
Securities surrendered for conversion or on account of any dividends on the
Parent Stock issued upon conversion.
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Section 11.04. Fractional Shares.
The Company will not issue a fractional share of Parent Stock upon conversion
of a Security. Instead, the Company will deliver cash or its check for the
current market value of a fractional share. The current market value of a
fractional share is determined as follows: Multiply the current market price of
a full share on the last full trading day prior to the conversion date by the
fraction (rounded to the nearest 1/100 of a share) and round the result to the
nearest whole cent.
Section 11.05. Taxes on Conversion.
If a Holder of a Security converts it, the Company shall pay any documentary,
stamp or similar issue or transfer tax due on the delivery of shares of Parent
Stock upon the conversion. The Holder, however, shall pay any such tax which is
due because the shares are issued in a name other than the Holder's name.
Section 11.06. Company to Provide Stock.
The Company shall (i) cause Parent to, from time to time as may be necessary,
reserve out of the Parent's authorized but unissued Parent Stock or its Parent
Stock held in treasury enough shares of Parent Stock to permit the conversion
of all outstanding Securities and (ii) secure from Parent (or elsewhere) a
sufficiant number of shares of Parent Stock for delivery upon conversions of
Securities.
All shares of Parent Stock which may be delivered upon conversion of the
Securities shall be validly issued, fully paid and non-assessable and shall be
free from any preemptive rights.
In order that the Company may deliver shares of Parent Stock upon conversion
of the Securities, the Company will , and will cause Parent to, endeavor to
comply with all applicable Federal and State securities laws and will endeavor
to cause such shares to be listed on each national or regional securities
exchange on which the Parent Stock is listed.
If the taking of any action would cause an adjustment to the then prevailing
conversion price or conversion rate which would result in shares of Parent
Stock being issued upon conversion of the Securities at an effective conversion
price below the then par value, if any, of the Parent Stock, or would raise the
par value above the effective conversion price then in effect, the Company
will, and will cause Parent to, take such corporate action as may, in the
opinion of its counsel, be necessary in order that the Parent may validly and
legally issue, and the Company may deliver, fully paid and non-assessable
shares of Parent Stock at such adjusted conversion price or conversion rate or
the conversion price or conversion rate then in effect, as the case may be.
Section 11.07. Adjustment for Change in Capital Stock.
If the Parent:
(1) pays a dividend or makes a distribution in shares of Parent Stock;
(2) subdivides the outstanding shares of Parent Stock into a greater
number of shares;
(3) combines the outstanding shares of Parent Stock into a smaller number
of shares;
(4) pays a dividend or makes a distribution on the Parent Stock in shares
of its capital stock other than Parent Stock; or
(5) issues by reclassification of its shares of Parent Stock any shares
of its capital stock,
then the conversion privilege and the conversion price or conversion rate in
effect immediately prior to the opening of business on the record date for such
dividend or distribution or the effective date of such subdivision, combination
or reclassification shall be adjusted so that the Holder of any Security
thereafter converted may receive the number of shares of capital stock of the
Parent which such Holder would have owned immediately following such action if
such Holder had converted the Security immediately prior to such time. Such
adjustment shall be made successively whenever any event listed above shall
occur.
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For a dividend or distribution, the adjustment shall become effective
immediately after the record date for the dividend or distribution. For a
subdivision, combination or reclassification, the adjustment shall become
effective immediately after the effective date of the subdivision, combination
or reclassification.
If after an adjustment a Holder of a Security upon conversion of it may
receive shares of two or more classes of capital stock of the Parent, the
conversion prices of the classes of capital stock (after giving effect to such
allocation of the adjusted conversion price between or among the classes of
capital stock as the Board of Directors shall determine to be appropriate) or
the conversion rate, as the case may be, shall thereafter be subject to
adjustment on terms comparable to those applicable to Parent Stock in this
Indenture.
Any shares of Parent Stock issuable in payment of a dividend shall be deemed
to have been issued immediately prior to the time of the record date for such
dividend for purposes of calculating the number of outstanding shares of Parent
Stock under Sections 11.08 and 11.09 below.
Section 11.08. Adjustments for Rights Issue.
If the Parent issues any rights or warrants to all holders of shares of
Parent Stock entitling them for a period expiring within 45 days after the
record date mentioned below to purchase shares of Parent Stock (or Convertible
Securities) at a price per share (or having a conversion price per share, after
adding thereto an allocable portion of the exercise price of the right or
warrant to purchase such Convertible Securities, computed on the basis of the
maximum number of shares of Parent Stock issuable upon conversion of such
Convertible Securities) less than the Average Market Price on the Determination
Date, the conversion price or rate shall be adjusted so that it shall equal the
price or rate determined by multiplying the conversion price or dividing the
conversion rate, as the case may be, in effect immediately prior to the opening
of business on that record date by a fraction, of which the numerator shall be
the number of shares of Parent Stock outstanding on such record date plus the
number of shares of Parent Stock which the aggregate offering price of the
total number of shares of Parent Stock so offered (or the aggregate conversion
price of the Convertible Securities to be so offered, after adding thereto the
aggregate exercise price of the rights or warrants to purchase such Convertible
Securities) would purchase at such Average Market Price and of which the
denominator shall be the number of shares of Parent Stock outstanding on such
record date plus the number of additional shares of Parent Stock offered for
subscription or purchase (or into which the Convertible Securities so offered
are convertible). Shares of Parent Stock owned by or held for the account of
the Parent shall not be deemed outstanding for the purpose of any such
adjustment.
For purposes of this Section 11.08, the number of shares of Parent Stock
outstanding on any record date shall be deemed to include (i) the maximum
number of shares of Parent Stock the issuance of which would be necessary to
effect the full exercise, exchange or conversion of all Convertible Securities
outstanding on such record date which are then exercisable, exchangeable or
convertible at a price equal to or less than the Average Market Price per share
of Parent Stock, if all of such Convertible Securities were deemed to have been
exercised, exchanged or converted immediately prior to the opening of business
on such record date and (ii) if the Series B TCI Group Common Stock is
convertible into Parent Stock, the maximum number of shares of Parent Stock the
issuance of which would be necessary to effect the full conversion of all
shares of Series B TCI Group Common Stock outstanding on such record date, if
all of such shares of Series B TCI Group Common Stock were deemed to have been
converted immediately prior to the opening of business on such record date.
The adjustment shall be made successively whenever any such rights or
warrants are issued, and shall become effective immediately after the record
date for the determination of stockholders entitled to receive the rights or
warrants. If all of the shares of Parent Stock (or all of the Convertible
Securities) subject to such rights or warrants have not been issued when such
rights or warrants expire (or, in the case of rights or warrants to purchase
Convertible Securities which have been exercised, all of the shares of Parent
Stock issuable upon conversion of such Convertible Securities have not been
issued prior to the expiration of the conversion right thereof), then the
conversion price or conversion rate shall promptly be readjusted to the
conversion price or conversion rate which would then be in effect had the
adjustment upon the issuance of such rights or warrants
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been made on the basis of the actual number of shares of Parent Stock (or
Convertible Securities) issued upon the exercise of such rights or warrants (or
the conversion of such Convertible Securities).
No adjustment shall be made under this Section 11.08 if the adjusted
conversion price would be higher than, or the adjusted conversion rate would be
less than, the conversion price or conversion rate, as the case may be, in
effect prior to such adjustment.
Section 11.09. Adjustments for Other Distributions.
If the Parent distributes to all holders of shares of its Parent Stock any
assets of debt securities or any rights or warrants to purchase securities, the
conversion price or conversion rate shall be adjusted by multiplying the
conversion price or dividing the conversion rate, as the case may be, in effect
immediately prior to the opening of business on the record date mentioned below
by a fraction, of which the numerator shall be the total number of shares of
Parent Stock outstanding on such record date multiplied by the Average Market
Price on the Determination Date, less the fair market value (as determined by
the Board of Directors) on such record date of said assets or debt securities
or rights or warrants so distributed, and of which the denomination shall be
the total number of shares of Parent Stock outstanding on such record date
multiplied by such Average Market Price.
For purposes of this Section 11.09, the number of shares of Parent Stock
outstanding on any record date shall be deemed to include (i) the maximum
number of shares of Parent Stock the issuance of which would be necessary to
effect the full exercise, exchange or conversion of all Convertible Securities
outstanding on such record date which are then exercisable, exchangeable or
convertible at a price equal to or less than the Average Market Price, if all
of such Convertible Securities were deemed to have been exercised, exchanged or
converted immediately prior to the opening of business on such record date and
(ii) if the Series B TCI Group Common Stock is convertible into Parent Stock,
the maximum number of shares of Parent Stock the issuance of which would be
necessary to effect the full conversion of all shares of Series B TCI Group
Common Stock outstanding on such record date, if all of such shares of Series B
TCI Group Common Stock were deemed to have been converted immediately prior to
the opening of business on such record date.
The adjustment shall be made successively whenever any such distribution is
made, and shall become effective immediately after the record date for the
determination of stockholders entitled to receive the distribution. Shares of
Parent Stock owned by or held for the account of the Parent shall not be deemed
outstanding for the purpose of any such adjustment.
No adjustment shall be made under this Section 11.09 if the adjusted
conversion price would be higher than, or the adjusted conversion rate would be
less than, the conversion price or conversion rate, as the case may be, in
effect prior to such adjustment.
This Section does not apply to cash dividends or distributions. Also, this
Section does not apply to dividends or distributions referred to in Section
11.07 or to rights or warrants referred to in Section 11.08.
Section 11.10. Voluntary Adjustment.
The Company at any time may reduce the conversion price or increase the
conversion rate, temporarily or otherwise, by any amount but in no event shall
such adjusted conversion price or conversion rate result in shares of Parent
Stock being issuable upon conversion of the Securities if converted at the time
of such adjustment at an effective conversion price per share less than the par
value of the Parent Stock at the time such adjustment is made.
A voluntary adjustment of the conversion price or conversion rate pursuant to
this Section 11.10 does not change or adjust the conversion price or conversion
rate otherwise in effect for purposes of Section 11.07, 11.08 or 11.09. If an
event requiring an adjustment to the conversion price or conversion rate
pursuant to Section 11.07, 11.08 or 11.09 occurs at any time that a voluntary
adjustment to the conversion price or conversion rate is in effect pursuant to
this Section 11.10, then the adjustment required by Section 11.07, 11.08 or
11.09, whichever
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is applicable, shall be made to the conversion price or conversion rate that
would otherwise have been in effect as of the relevant date specified in such
Section had no voluntary adjustment pursuant to this Section 11.10 been made,
and for purposes of applying such Section, any such voluntary adjustment shall
be disregarded. If such adjustment would result in a lower conversion price or
a higher conversion rate, as the case may be, than the conversion price or
conversion rate as voluntarily adjusted by the Company, then such lower
conversion price or higher conversion rate shall be the conversion price or
conversion rate, as the case may be.
Section 11.11. Certain Definitions.
For the purposes of this Article, the following terms have the following
meanings:
"Average Market Price" of a share of Parent Stock on the Determination
Date for any issuance of rights or warrants or any distribution in respect
of which the Average Market Price is being calculated means the average of
the daily current market prices of the Parent Stock for the shortest of:
(i) the period of 30 consecutive trading days commencing 45 trading
days before such Determination Date.
(ii) the period commencing on the date next succeeding the first
public announcement of the issuance of rights or warrants or the
distribution in respect of which the Average Market Price is being
calculated and ending on the last full trading day before such
Determination Date, and
(iii) the period, if any, commencing on the date next succeeding the
Ex-Dividend Date with respect to the next preceding issuance of rights
or warrants or distribution for which an adjustment is required by the
provisions of Section 11.07(4), 11.08 or 11.09, and ending on the last
full trading day before such Determination Date.
If the record date for an issuance of rights or warrants or a
distribution for which an adjustment is required by the provisions of
Section 11.07(4), 11.08 or 11.09 (the "preceding adjustment event")
precedes the record date for the issuance or distribution in respect of
which the Average Market price is being calculated and the Ex-Dividend Date
for such preceding adjustment event is on or after the Determination Date
for the issuance or distribution in respect of which the Average Market
Price is being calculated, then the Average Market Price shall be adjusted
by deducting therefrom the fair market value (on the record date for the
issuance or distributions in respect of which the Average Market Price is
being calculated), as determined by the Board of Directors, of the capital
stock, rights, warrants, assets or debt securities issued or distributed in
respect of each share of Parent Stock in such preceding adjustment event.
Further, in the event that the Ex-Dividend Date (or in the case of a
subdivision, combination or reclassification, the effective date with
respect thereto) with respect to a dividend, subdivision, combination or
reclassification to which Section 11.07(1), (2), (3) or (5) applies occurs
during the period applicable for calculating the Average Market Price, then
the Average Market Price shall be calculated for such period in a manner
determined by the Board of Directors to reflect the impact of such
dividend, subdivision, combination or reclassification on the current
market price of the Parent Stock during such period.
"current market price" of a share of Parent Stock on any day means the
last reported sale price (or, if no sale price is reported, the average of
the high and low bid prices) on such day on the NASDAQ Stock Market or as
quoted by the National Quotation Bureau Incorporated, or if the Parent
Stock is listed on an exchange, on the principal exchange on which the
Parent Stock is listed. In the event that no such quotation is available
for any day, the Board of Directors shall be entitled to determine the
current market price on the basis of such quotations as it considers
appropriate.
"Determination Date" for any issuance of rights of warrants or any
distribution to which Section 11.08 or 11.09 applies means the earlier of
(i) the record date for the determination of stockholders entitled to
receive the rights or warrants or the distribution to which such Section
applies and (ii) the Ex-Dividend Date for such rights, warrants or
distribution.
"Ex-Dividend Date" means the date on which "ex-dividend" trading
commences for a dividend, an issuance of rights or warrants or a
distribution to which any of Sections 11.07, 11.08 and 11.09 applies in the
over-the-counter market or on the principal exchange on which the Parent
Stock is then quoted or listed.
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Section 11.12. When Adjustment May Be Deferred.
In any case in which this Article shall require that an adjustment shall
become effective immediately after a record date for an event, the Company may
defer until the occurrence of such event (i) issuing to the Holder of any
Security converted after such record date and before the occurrence of such
event the additional shares of Parent Stock issuable upon such conversion by
reason of the adjustment required by such event over and above the shares of
Parent Stock issuable upon such conversion before giving effect to such
adjustment and (ii) paying to such Holder cash or its check in lieu of any
fractional interest to which he is entitled pursuant to Section 11.04;
provided, however, that the Company shall deliver to such Holder a due bill or
other appropriate instrument evidencing such Holder's rights to receive such
additional shares of Parent Stock, and such cash, upon the occurrence of the
event requiring such adjustment.
Section 11.13 When Adjustment Is Not Required.
No adjustments in the conversion rate need be made unless the adjustment
would require an increase or decrease of at least one percent (1%) in the
initial conversion or conversion rate. Any adjustment which is not made shall
be carried forward and taken into account in any subsequent adjustment.
All calculations under this Article shall be made to the nearest cent or to
the nearest 1/100 of a share, as the case may be.
No adjustment in the conversion price or the conversion rate shall be made
because the Parent issues, in exchange for cash, property or services, shares
of Parent Stock, or any securities convertible into or exchangeable for shares
of Parent Stock or securities carrying the right to purchase shares of Parent
Stock or such convertible exchangeable securities.
No adjustment in the conversion price or conversion rate need be made under
this Article for sales of shares of Parent Stock pursuant to a Parent plan
providing for reinvestment of dividends or interest or in the event the par
value of the Parent Stock is changed.
No adjustment in the conversion price or conversion rate need be made for a
transaction referred to in Section 11.07, 11.08 or 11.09 if Securityholders are
to participate in the transaction on a basis and with notice that the Board of
Directors determines to be fair and appropriate in light of the basis and
notice on which holders of Parent Stock participate in the transaction;
provided that the basis on which the Securityholders are to participate in the
transaction shall not be deemed to be fair if it would require the conversion
of Securities at any time prior to the expiration of the conversion period
specified for such Securities.
To the extent the Securities become convertible into cash, no adjustment need
be made thereafter as to the cash. Interest will not accrue on the cash.
Section 11.14. Notice of Adjustment.
Whenever the conversion price or conversion rate is adjusted, the Company
shall promptly mail to Securityholders a notice of the adjustment and file with
the Trustee an Officers' Certificate briefly stating the new conversion price
or conversion rate, the date it becomes effective, the facts requiring the
adjustment and the manner of computing it. The certificate shall be conclusive
evidence that the adjustment is correct.
Section 11.15. Notice of Certain Transactions.
If:
(a) the Parent takes any action which would require an adjustment in the
conversion price or conversion rate;
(2) the Parent consolidates or merges with, or transfers all or
substantially all of its assets to, another corporation, and stockholders
of the Parent must approve the transaction; or
(3) there is a dissolution or liquidation of the Parent,
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a Holder of a Security may want to convert it into shares of Parent Stock prior
to the record date for, or the effective date of, the transaction so that he
may receive the rights, warrants, securities or assets which a holder of shares
of Parent Stock on that date may receive. Therefore, the Company shall mail to
the Securityholders and the Trustee a notice stating the proposed record or
effective date, as the case may be. Failure to mail the notice or any defect in
it shall not affect the validity of any transaction referred to in clause (1),
(2) or (3) of this Section.
Section 11.16. Consolidation, Merger or Sale of the Parent.
If the Parent is a party to a transaction described in Section 5.01 or a
merger which reclassifies or changes its outstanding Parent Stock, the Company
shall enter into a supplemental indenture. The supplemental indenture shall
provide that the Holder of a Security may convert it into the kind and amount
of securities or cash or other assets which he would have owned immediately
after the consolidation, merger or transfer if he had converted the Security
immediately before the effective date of such transaction, assuming (to the
extent applicable) that such Holder failed to exercise any rights of election
with respect thereto and received per share of Parent Stock the kind and amount
of securities, cash or assets received per share by a plurality of the non-
electing shares. The supplemental indenture shall provide for adjustments which
shall be as nearly equivalent as may be practical to the adjustments provided
for in this Article. The Company shall mail to each Securityholder a notice
describing the supplemental indenture.
If this Section applies, Sections 11.07, 11.08 and 11.09 shall not apply.
Section 11.17. Company Determination Final.
Any determination which the Board of Directors must make pursuant to Sections
11.07, 11.09, 11.11, 11.13 or 11.16 is conclusive and binding on the Holders.
Section 11.18. Trustee's Disclaimer.
Neither the Trustee nor any Conversion Agent has any duty to determine when
an adjustment under this Article should be made, how it should be made or what
it should be. Neither the Trustee nor any Conversion Agent has any duty to
determine whether any provisions of a supplemental indenture under Section
11.16 are correct. Neither the Trustee nor any Conversion Agent makes any
representation as to the validity or value of any securities or assets issued
upon conversion of Securities. Neither the Trustee nor any Conversion Agent
shall be responsible for the Company's failure to comply with this Article.
Section 11.19. Simultaneous Adjustments.
In the event that this Article Eleven requires adjustments to the conversion
price or conversion rate under more than one of Sections 11.07(4), 11.08 or
11.09, and the record dates for the distributions giving rise to such
adjustments shall occur on the same date, then such adjustments shall be made
by applying, first, the provisions of Section 11.07, second, the provisions of
Section 11.09 and, third, the provisions of Section 11.08.
ARTICLE TWELVE
Miscellaneous
Section 12.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by any of TIA (S)(S) 310 to 317, inclusive, through operation of
TIA (S) 318(e), such imposed duties shall control.
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Section 12.02. Notices.
Any notice or communication shall be sufficiently given if in writing and
delivered in person or mailed by first-class mail addressed as follows:
If to the Company:
TCI Communications, Inc.
Suite 600
4643 South Ulster Street
Denver, Colorado 80237
Attention: Bernard W. Schotters, Senior Vice-President--Finance
and Treasurer
If to the Trustee:
Attention:
The Company or the Trustee by notice to the other may designate additional or
different addresses for subsequent notices or communications.
Any notice or communication mailed to a Securityholder shall be mailed to him
at his address as it appears on the registration books of the Registrar and
shall be sufficiently given to him if so mailed within the time prescribed.
Failure to mail a notice or communication to a Securityholder or any defect
in it shall not affect its sufficiency with respect to other Securityholders.
Except for a notice to the Trustee, which is deemed given only when received,
if a notice or communication is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it.
Section 12.03. Communication by Holders with Other Holders.
Securityholders may communicate pursuant to TIA (S) 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and anyone else shall have
the protection of TIA (S) 312(c).
Section 12.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee:
(1) an Officers' Certificate stating that, in the opinion of the signers,
all conditions precedent (including any covenants compliance with which
constitutes a condition precedent), if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such counsel,
all such conditions precedent (including any covenants compliance with
which constitutes a condition precedent) have been complied with.
Section 12.05. Statements Required in Certificate or Opinion.
Each Officers' Certificate or Opinion of Counsel with respect to compliance
with a condition or covenant provided for in this Indenture (other than
certificates provided pursuant to Section 4.03) shall include:
(1) a statement that the person making such certificate or opinion has
read such covenant or condition;
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(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such person, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and
(4) a statement as to whether or not, in the opinion of such person, such
condition or covenant has been complied with.
Section 12.06. When Treasury Securities Disregarded.
In determining whether the Holders of the required aggregate principal amount
of Securities of any series have concurred in any direction, waiver or consent,
Securities of such series owned by the Company or by any Affiliate of the
Company shall be disregarded and treated as not outstanding, except that for
the purposes of determining whether the Trustee shall be protected in relying
on any such direction, waiver or consent, only Securities of such series which
the Trustee knows are so owned shall be so disregarded.
Section 12.07. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or a meeting of the
Securityholders of all series or any series. The Registrar, Paying Agent or
Conversion Agent may make reasonable rules for its functions.
Section 12.08. Legal Holidays.
A "Legal Holiday" is a Saturday, a Sunday, or a day on which banking
institutions in the City of New York, New York, are not required to be open. If
a specified date (including a date for giving notice) or the last day to
convert a Security is a Legal Holiday, any action to be taken on such date
pursuant to this Indenture or the Securities (including such conversion) may be
taken on the next succeeding day that is not a Legal Holiday, and, to the
extent applicable, no interest, or original issue discount, as the case may be,
shall accrue for the intervening period.
Section 12.09. Governing Law.
The internal laws of the State of New York shall govern this indenture and
the Securities.
Section 12.10. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or debt
agreement of the Company or a Subsidiary. Any such indenture, loan or debt
agreement may not be used to interpret this Indenture.
Section 12.11. No Recourse Against Others.
No past, present or future director, officer, employee or stockholder, as
such, of the Company or any successor thereof shall have any liability for any
obligations of the Company under the Securities or this Indenture or for any
claim based on, in respect of, or by reason of, such obligations or their
creation and all such liability is hereby waived and released. Such waiver and
release are part of the consideration for the issue of the Securities.
Section 12.12. Successors.
All agreements of the Company in this Indenture and the Securities shall bind
its successor. All agreements of the Trustee in this Indenture shall bind its
successor.
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Section 12.13. Duplicate Originals.
The parties may sign any number of copies of this Indenture. Each signed copy
shall be an original, but all of them together represent the same agreement.
Section 12.14. Table of Contents, Headings, Etc.
The table of contents and the titles and headings of the Articles and
Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part hereof, and shall in no way modify or
restrict any of the terms or provisions hereof.
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Signatures
Dated: , 199
TCI Communications, Inc
By __________________________________
(Seal)
Attest: _____________________________
Secretary
Dated: , 199
By __________________________________
(Seal)
Attest:
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EXHIBIT 4.4
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) TO THE COMPANY
(AS DEFINED BELOW) OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH
OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
REGISTERED PRINCIPAL AMOUNT
No. FX- $
CUSIP No.
TCI COMMUNICATIONS, INC.
MEDIUM-TERM NOTE, SERIES C
(FIXED RATE)
ORIGINAL ISSUE DATE INTEREST RATE: STATED MATURITY
DATE:
INTEREST PAYMENT INITIAL REDEMPTION INITIAL
DATES (If other than DATE: REDEMPTION
February 15 and PERCENTAGE:
August 15)
EXTENSION
PERIOD(S):
FINAL MATURITY
DATE:
ANNUAL REDEMPTION OPTIONAL REPAYMENT
PERCENTAGE REDUCTION: DATE(S): OTHER TERMS:
TCI COMMUNICATIONS, INC., a Delaware corporation (the "Company", which term
includes any successor corporation permitted by the terms hereof), for value
received, hereby promises to pay to , or registered assigns, the principal
sum of DOLLARS on the Stated Maturity Date specified above (except to the
extent redeemed or repaid prior to the Stated Maturity Date and except to the
extent extended as provided herein), and to pay interest thereon at the
Interest Rate per annum specified above, from the Original Issue Date
specified above until the principal hereof is paid or duly made available for
payment. The Company shall pay interest semi-annually on the dates specified
above or, if none are specified, February 15 and August 15 (each an "Interest
Payment Date") in each year commencing on the first Interest Payment Date next
succeeding the Original Issue Date specified above, and on the Stated Maturity
Date, or any Redemption Date, Purchase Date or Optional Repayment Date (in
each case as defined herein) on which this Note is redeemed, repurchased or
repaid prior to the Stated Maturity Date in whole or in part, (each such
Stated Maturity Date, Redemption Date, Purchase Date and Optional Repayment
Date being referred to hereinafter as a "Maturity Date" with respect to
principal, premium, if any, and interest payable on such date); provided,
however, unless otherwise specified herein, if the Original Issue Date
specified above is between a Regular Record Date (as defined below) and the
next succeeding Interest Payment Date or on an Interest Payment Date, interest
payments hereon will commence on the Interest Payment Date following the next
succeeding Regular Record Date, to the registered Holder of this Note on such
next succeeding Regular Record Date. Interest on this Note shall accrue from
the most recent Interest Payment Date in respect of which interest has been
paid or duly provided for or, if no interest has been
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paid, from and including the Original Issue Date specified above, until the
principal hereof has been paid or made available for payment in full. If a
Maturity Date or an Interest Payment Date falls on a day that is not a Business
Day (as defined below), the related payment of principal, premium, if any, or
interest payable with respect to such Maturity Date or Interest Payment Date
shall be paid on the next succeeding Business Day with the same force and
effect as if made on such Maturity Date or Interest Payment Date, as the case
may be, and no interest shall accrue on the amount so payable for the period
from and after such Maturity Date or Interest Payment Date, as the case may be.
The interest (except defaulted interest) so payable or duly provided for on any
Interest Payment Date shall be paid to the person in whose name this Note or
one or more predecessor Notes is registered at the close of business on the
Regular Record Date for such Interest Payment Date, which shall be the date
fifteen (15) calendar days (whether or not a Business Day) prior to the
applicable Interest Payment Date; provided, however, that interest payable on
any Maturity Date shall be payable to the person to whom the principal hereof
shall be payable. As used herein, "Business Day" means any day, other than a
Saturday or Sunday, that is not a day on which banking institutions are
authorized or required by law or regulation to be closed in The City of New
York, New York.
Payment of the principal of, premium, if any, and interest on this Note shall
be made in such coin or currency of the United States of America as at the time
of payment is legal tender for the payment of public and private debts, to the
Holder hereof upon presentation of this Note at the office of the Paying Agent
which is currently the Corporate Trust Department of the Trustee (as defined
herein), 101 Barclay Street, Floor 21 West, New York, New York 10286, or at
such other office or agency of the Company in The City of New York, New York as
the Company shall designate by written notice to the Holder hereof; provided,
however, that payment of interest on any Interest Payment Date (but not on the
Maturity Date) without presentation of this Note (i) may be made by check
mailed to the address of the Holder hereof as of the close of business on the
immediately preceding Regular Record Date at such address as shall appear in
the security register or (ii) upon receipt by the Paying Agent of appropriate
instructions in writing from the Holder hereof (provided such Holder is the
holder of an aggregate principal amount of Notes, including this Note, in
excess of $10,000,000 having the same Interest Payment Dates), not less than
sixteen (16) calendar days prior to such Interest Payment Date, shall be made
by the wire transfer of immediately available funds to such account at a bank
in The City of New York, New York (or other bank consented to by the Company
and the Paying Agent) as the Holder hereof shall have designated in such
instructions so long as such bank has appropriate facilities therefor. Payment
of the principal of, premium, if any, and interest with respect to this Note
will be made on a Maturity Date, upon presentation and surrender of this Note
to the Paying Agent as provided above, (a) in immediately available funds,
provided that this Note is so presented and surrendered in time for the Paying
Agent to make such payment in immediately available funds in accordance with
its normal procedures, or (b) by the wire transfer of immediately available
funds to such account at a bank in The City of New York, New York (or other
bank consented to by the Company and the Paying Agent) as the Holder hereof
shall have designated, provided that such bank has appropriate facilities
therefor and that wire transfer instructions in writing have been received by
the Paying Agent not less than sixteen (16) calendar days prior to such
Maturity Date. If required by applicable law or instructed by the Company or
any governmental agency that taxes or other governmental charges should be
withheld, the Paying Agent shall withhold any such taxes or other governmental
charges on any payments made in connection with this Note.
This Note is one of a duly authorized issue of securities of the Company
issued and to be issued under an Indenture dated as of , 199 (the
"Indenture"), between the Company, as issuer, and The Bank of New York, as
trustee (herein called the "Trustee", which term includes any successor trustee
under the Indenture) which securities may be issued in one or more series
(therein called the "Securities"). The terms of the Notes (as defined below)
include those stated in the Indenture and those made part of the Indenture by
the Trust Indenture Act of 1939, as amended (the "Act"). Reference is hereby
made to the Indenture and all indentures supplemental thereto and the Act for a
statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Company, the Trustee and the Holders of the
Securities, and of the terms upon which the Securities are, and are to be,
authenticated and delivered. All terms used and not defined in this Note which
are defined in the Indenture shall have the meanings assigned to them in the
Indenture. This Note is one
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<PAGE>
of the series of Securities designated Medium-Term Notes Due from Nine Months
or more from Date of Issue (Securities of such series being herein called the
"Notes"). The Notes are general unsecured obligations of the Company.
This Note shall not be subject to any sinking fund and, except as may be
provided in the next three paragraphs, shall not be redeemable or repayable
prior to its Stated Maturity Date. If an Event of Default with respect to the
Notes shall occur and be continuing, the principal amount of and accrued
interest on the Notes may be declared or may become due and payable in the
manner and with the effect provided in the Indenture.
If so provided above, this Note may be redeemed at the option of the Company
on any date on and after the Initial Redemption Date, if any, specified above.
If no Initial Redemption Date is set forth above, this Note may not be
redeemed at the option of the Company prior to its Stated Maturity Date. On
and after the Initial Redemption Date, if any, this Note may be redeemed at
any time in whole or from time to time in part in denominations of $1,000
principal amount hereof of any integral multiple of $1,000 (provided that any
remaining principal amount hereof shall be at least $1,000) at the option of
the Company at the applicable Redemption Price (as defined below), together
with accrued and unpaid interest on the principal amount to be redeemed at the
applicable rate to but excluding the date of redemption (each such date, a
"Redemption Date"), on notice given by the Company or the Trustee to the
Holder hereof not more than 60 nor less than 30 days prior to the Redemption
Date. Whenever less than all the Notes at any time outstanding are to be
redeemed, the particular Notes to be so redeemed shall be selected by the
Company, provided that if less than all the Notes with identical terms at any
time outstanding are to be redeemed, the Notes to be so redeemed shall be
selected by the Trustee by lot or such other method as the Trustee considers
fair and appropriate. In the event of redemption of this Note in part only, a
new Note for the unredeemed portion hereof shall be issued in the name of the
Holder hereof upon the surrender hereof. The "Redemption Price" shall
initially be the Initial Redemption Percentage, if any, specified above, of
the principal amount of this Note to be redeemed and, if the Initial
Redemption Percentage is greater than 100%, shall decline at each anniversary
of the Initial Redemption Date, shown above, by the Annual Redemption
Percentage Reduction, if any, of the principal amount to be redeemed until the
Redemption Price is 100% of such principal amount.
If both (i) a Change of Control of the Company shall occur at any time after
the Original Issue Date and on or prior to the Stated Maturity Date (as the
same may be extended as described below) and (ii) on any date during the
period commencing 90 days before and ending 90 days after a public filing has
been made with the Securities and Exchange Commission (the "Commission") or
other general public disclosure has been made indicating the occurrence of
such Change of Control, the then current rating of the Notes by Duff & Phelps
Credit Rating Co. or its successor ("D&P") or by Moody's Investors Service,
Inc. or its successor ("Moody's") is downgraded to lower than BBB-, in the
case of D&P (or an equivalent successor rating or, if the rating of the
Securities by D&P is lower than BBB- (or an equivalent rating) at the
beginning of such 180-day period, the rating in effect at the beginning of
such period), or lower than Baa3, in the case of Moody's (or an equivalent
successor rating or, if the rating of the Securities by Moody's is lower than
Baa3 (or an equivalent successor rating) at the beginning of such 180-day
period, the rating in effect at the beginning of such period) and, in the
event that such downgrading shall have occurred during the 90-day period prior
to such public disclosure, the rating assigned to the Notes by D&P or Moody's
(or an equivalent successor rating) as of the close of business on the date of
such public disclosure remains lower than BBB- or lower than Baa3 (or such
lower rating by D&P or Moody's in effect at the beginning of such 180-day
period, as the case may be), respectively (the occurrence of the conditions
specified in both (i) and (ii) above being a "Put Event"), then the Holder
hereof shall have the right, at such Holder's option and subject to the
conditions of Section 4.02 of the Indenture, to require the Company to
repurchase all or any portion of this Note at a purchase price equal to 100%
of the principal amount hereof, plus accrued and unpaid interest, if any, to
the Purchase Date, all as provided in, and subject to the terms of, the
Indenture. The Company will not be obligated, with respect to the Notes, to
purchase Notes or give notice to the Holders thereof with respect to more than
one Put Event.
This Note may be subject to repayment at the option of the Holder hereof on
each Optional Repayment Date, if any, indicated above. If no Optional
Repayment Date is set forth above, this Note may not be so repaid
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<PAGE>
at the option of the Holder hereof prior to its Stated Maturity Date. On any
Optional Repayment Date this Note shall be repayable in whole or in part in
denominations of $1,000 principal amount hereof or any integral multiple of
$1,000 (provided that any remaining principal hereof shall be at least $1,000),
at the option of the Holder hereof at a repayment price equal to 100% of the
principal amount to be repaid, together with accrued and unpaid interest
thereon at the applicable rate to but excluding the date of repayment. For this
Note to be repaid in whole or in part at the option of the Holder hereof,
either (i) this Note must be surrendered, not more than 60 nor less than 30
days prior to an Optional Repayment Date (except as otherwise provided in the
following fourth succeeding paragraph), with the form entitled "Option to Elect
Repayment" below duly completed, at the office of the Paying Agent (currently
the Corporate Trust Department of the Trustee at 101 Barclay Street, Floor 21
West, New York, New York 10286), or at such other office or agency of the
Company in The City of New York, New York as the Company shall designate by
written notice to the Holder hereof or (ii) the Paying Agent must receive at
such office, within such period of time prior to an Optional Repayment Date, a
telegram, telex, facsimile transmission or letter from a member of a national
securities exchange or the National Association of Securities Dealers, Inc. or
a commercial bank or trust company in the United States setting forth the name
of the Holder of this Note, the principal amount of this Note, the principal
amount of this Note to be repaid, the certificate number or a description of
the tenor and terms hereof, a statement that the option to elect repayment is
being exercised thereby and a guarantee that this Note, with the form entitled
"Option to Elect Repayment" below duly completed, will be surrendered to the
Paying Agent not later than five business Days after the date of such telegram,
telex, facsimile transmission or letter and this Note, with such form duly
completed, are received by the Paying Agent by such fifth Business Day.
Exercise of such repayment option by the Holder hereof shall be irrevocable
except as otherwise provided in the following fourth succeeding paragraph. No
transfer or exchange of this Note (or, in the event that this Note is to be
repaid in part, the portion of this Note to be repaid) will be permitted after
exercise of a repayment option. All questions as to the validity, eligibility
(including time or receipt) and acceptance of this Note for repayment will be
determined by the Company, which determination will be fixed, binding and non-
appealable.
This Note may be subject to an extension of its Stated Maturity Date at the
option of the Company for one or more whole year periods, if any, indicated
above (each an "Extension Period") up to but not beyond the date (the "Final
Maturity Date"), if any, indicated above. If this Note is subject to an
extension of its Stated Maturity Date, the basis or formula, if any, for
setting the interest rate for such Extension Period will be as indicated above.
The Company may exercise such option with respect to this Note by notifying
the Trustee of such exercise not more than 60 nor less than 45 days prior to
the Stated Maturity Date in effect prior to the exercise of such option (the
"Original Stated Maturity Date"). No later than 40 days prior to the Original
Stated Maturity Date, the Trustee will mail to the Holder hereof a notice (the
"Extension Notice") relating to such Extension Period, first class, postage
prepaid, setting forth (i) the election of the Company to extend the Stated
Maturity Date, (ii) the new Stated Maturity Date, (iii) the interest rate
applicable to the Extension Period, and (iv) the provisions, if any, for
redemption at the option of the Company during the Extension Period, including
the date or dates on which or the period or periods during which and the price
or prices at which such redemption may occur during the Extension period. Upon
the mailing by the Trustee of an Extension Notice to the Holder hereof, the
Stated Maturity Date of this Note shall be extended automatically as set forth
in the Extension Notice, and except as modified by the Extension Notice and as
described in the next paragraph, such Note will have the same terms as prior to
the mailing of such Extension Notice.
Notwithstanding the foregoing, not later than 20 days prior to the Original
Stated Maturity Date, the Company may, at its option, revoke the interest rate
provided for in the Extension Notice and establish a higher interest rate for
the Extension Period by mailing or causing the Trustee to mail notice of such
higher interest rate by first class mail, postage prepaid to the Holder hereof.
Such notice shall be irrevocable. All Notes with identical terms with respect
to which the Stated Maturity Date is extended will bear such higher interest
rate for the Extension Period.
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If the Company elects to extend the Stated Maturity Date and if repayment at
the option of the Holder upon such extension is provided for above, the Holder
hereof will have the option to elect repayment of this Note by the Company on
the Original Stated Maturity Date at a price equal to the principal amount
hereof plus any accrued and unpaid interest to such date. In order for a Note
to be so repaid on the Original Stated Maturity Date, the Holder hereof must
follow the procedures set forth herein for optional repayment, except that the
period for deliver of this Note with the "Option to Elect Repayment" form to
the Trustee shall be at least 25 but not more than 35 days prior to the
Original Stated Maturity Date and except that a Holder who has tendered this
Note for repayment pursuant to an Extension Notice may, by written notice to
the Trustee, revoke any such tender for repayment until the close of business
on the tenth day prior to the Original Stated Maturity Date.
Interest payments on this Note shall include interest accrued from, and
including, the most recent date to which interest has been paid or duly
provided for (or from and including the Original Issue Date specified above, if
no interest has been paid, to, but excluding, the related Interest Payment Date
or Maturity Date, as the case may be. Interest shall be computed and paid on
the basis of a 360-day year of twelve 30-day months,
This Note, and any Note or Notes issued upon transfer or exchange hereof, may
be issued only in fully registered form, without coupons, in denominations of
$1,000 and any integral multiple of $1,000.
As provided in the Indenture and subject to certain limitations therein set
forth (including without limitation the restrictions on transfer under Sections
2.02 and 2.08 of the Indenture in the event this Note is a global Security),
the transfer of this Note is registrable in the security register, upon
surrender of this Note for registration of transfer at the office of the
Registrar in The City of New York, New York designated for such purpose, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Registrar duly executed by, the Holder
hereof or his attorney duly authorized in writing, and thereupon one or more
new registered Notes, of authorized denominations and of a like aggregate
principal amount and otherwise bearing identical terms and provisions, will be
issued in the name of the designated transferee or transferees.
Prior to due presentment of this Note 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 Note is registered as the owner hereof for all
purposes of this Note, whether or not this Note shall be overdue, and none of
the Company, the Trustee or any such agent shall be affected by notice to the
contrary.
As provided in the Indenture and subject to certain limitations therein set
forth (including without limitation the restrictions on exchange under Sections
2.02 and 2.08 of the Indenture in the event this Note is a global Security),
Notes are exchangeable for a like aggregate principal amount of Notes of a
different authorized denomination and otherwise bearing identical terms and
provisions, as requested by the Holder surrendering the same at the office of
the Registrar in The City of New York, New York designated for such purpose.
No service charge shall be made for any such registration of transfer or
exchange, but the Company or the Registrar may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. Initially, the Trustee will act as Registrar and the office at which
Notes must be surrendered for registration of transfer or exchange is currently
the Corporate Trust Department of the Trustee, 101 Barclay Street, Floor 21
West, New York, New York 10286.
The Indenture permits, with certain exceptions as therein provided, the
Indenture (insofar as the Notes are concerned) or the Notes to be amended or
supplemented and the rights and obligations of the Company and the rights of
the Holders of Notes to be modified by the Company and the Trustee with the
consent of the Holders of a majority in principal amount of the outstanding
Notes, on behalf of all the holders of Notes, to waive compliance by the
Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences, in each case insofar as the Notes
are concerned. Any such consent or waiver by the Holder of this Note shall be
conclusive and binding upon such Holder and upon all future Holders of this
Note and of any Note issued upon the registration of transfer hereof or in
exchange herefor or in lieu hereof, whether
5
<PAGE>
or not notation of such consent or waiver is made upon this Note. Without the
consent of any Holder, the Company and the Trustee may amend or supplement the
Indenture or the Notes to cure any ambiguity, defect or inconsistency or to
make certain other specified changes or any change that does not materially
adversely affect the rights of any Holder. Holders of Notes may not enforce
their rights pursuant to the Indenture or the Notes, except as permitted in the
Indenture.
No reference herein to the Indenture and no provision of this Note or of the
Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of, premium, if any, and
interest on this Note at the times, place and rate, and in the manner and coin
or currency, herein prescribed.
When a successor corporation assumes all the obligations of its predecessor
under the Notes and the Indenture as provided in the Indenture, the predecessor
corporation will be released from those obligations.
A director, officer, employee, or stockholder, as such, of the Company or the
Trustee shall not have any liability for any obligations of the Company or the
Trustee under the Notes or the Indenture or for any claim based on, in respect
of, or by reason or such obligations or their creation. Each Holder by
accepting a Note waives and releases all such liability. The waiver and release
are part of the consideration for the issue of the Notes.
The Indenture and the Notes shall be governed by and construed in accordance
with the laws of the State of New York applicable to agreements made and to be
performed in such State.
Unless the certificate of authentication hereon has been executed by the
Trustee by the manual signature of one of its authorized officers, this Note
shall not be entitled to any benefit under the Indenture (as defined herein) or
be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed, manually or by facsimile.
TCI Communications, Inc.
By: _________________________________
Attest:
_____________________________________
Secretary
Dated:
CERTIFICATE OF AUTHENTICATION:
This is one of the
Securities of the series
designated herein
referred to in the
within-mentioned
Indenture.
The Bank of New York
as Trustee
By: _________________________________
Authorized Signatory
6
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations.
TEN COM--as tenants in common
UNIF GIFT MIN ACT--..................... Custodian.....................
Under Uniform Gifts to Minors Act
.................................
TEN ENT--as tenants by the entireties
JT TEN--as joint tenants with right of survivorship and not as
tenants in common
Additional abbreviations may also be used though not in the above list.
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) and instruct(s) the Company to
repay this Note (or portion hereof specified below) pursuant to its terms at a
price equal to 100% of the principal amount of this Note (or of such specified
portion) together with interest on the amount to be repaid to the repayment
date, to the undersigned, at:
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name and address of the undersigned.)
For this Note to be repaid in whole or in part, the Paying Agent must
receive at 101 Barclay Street, Floor 21 West, New York, New York 10286 (or at
such other place or places in The City of New York, New York of which the
Company shall from time to time notify the Holder of this Note), not more than
60 nor less than 30 days prior to an Optional Repayment Date, if any, shown on
this Note, either (i) this Note with this "Option to Elect Repayment" form
duly completed or (ii) a telegram, telex, facsimile transmission or letter
from a member of a national securities exchange or the National Association of
Securities Dealers, Inc. or a commercial bank or trust company in the United
States setting forth the name of the Holder of this Note, the Principal amount
of this Note, the principal amount of this Note to be repaid, the certificate
number or a description of the tenor and terms hereof, a statement that the
option to elect repayment is being exercised thereby and a guarantee that this
Note, with this "Option to Elect Repayment" form duly completed, will be
surrendered to the Paying Agent not later than five Business Days after the
date of such telegram, telex, facsimile transmission or letter and this Note,
with this form duly completed, are received by the Paying Agent by such fifth
Business Day.
7
<PAGE>
If less than the entire principal amount of this Note is to be repaid,
specify the portion hereof (which shall be denominations of $1,000 principal
amount) which the Holder elects to have repaid and specify the denomination or
denominations (which shall be $1,000 or an integral multiple of $1,000) of the
Notes to be issued to the Holder for the portion of this Note not being repaid
(in the absence of any such specification, one such Note will be issued for
the portion not being repaid).
$ _____________________________
Signature: ____________________
Date __________________________ NOTICE: The signature on this
Option to Elect Repayment must
correspond with the name as
written upon the face of this
Note in every particular,
without alteration or
enlargement or any change
whatsoever.
8
<PAGE>
ASSIGNMENT FORM
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name and address including zip code of assignee and
insert Taxpayer Identification No.)
the attached Note and all rights thereunder, hereby irrevocably constituting
and appointing attorney to transfer said Note on the books of the
issuer, with full power of substitution in the premises.
Dated: ________________________ Signature: ____________________
NOTICE: The signature of the
registered owner to this
assignment must correspond
with the name as written upon
face of the Note in every
particular, without alteration
or enlargement or any change
whatsoever.
Signature Guarantee: ___________________________
9
<PAGE>
EXHIBIT 4.5
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) TO THE COMPANY
(AS DEFINED BELOW) OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH
OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
REGISTERED PRINCIPAL AMOUNT
No. FLR $
CUSIP No.
TCI COMMUNICATIONS, INC.
MEDIUM-TERM NOTE, SERIES C
(FLOATING RATE)
<TABLE>
<C> <S> <C>
INTEREST RATE BASIS OR BASIS: ORIGINAL ISSUE DATE: STATED MATURITY DATE:
INDEX MATURITY: INITIAL INTEREST RATE: INTEREST PAYMENT PERIOD:
SPREAD: INITIAL INTEREST RESET INTEREST PAYMENT DATES:
DATE:
SPREAD MULTIPLIER: INTEREST RESET PERIOD: INTEREST RESET DATES:
MAXIMUM INTEREST RATE: MINIMUM INTEREST RATE: INITIAL REDEMPTION DATE:
INITIAL REDEMPTION ANNUAL REDEMPTION OPTIONAL REPAYMENT
PERCENTAGE: PERCENTAGE REDUCTION: DATE(S):
CALCULATION AGENT EXTENSION PERIOD(S):
(if other than FINAL MATURITY DATE:
The Bank of New York): OTHER TERMS:
</TABLE>
TCI COMMUNICATIONS, INC., a Delaware corporation (the "Company", which term
includes any successor corporation permitted by the terms hereof), for value
received, hereby promises to pay to , or registered assigns, the principal
sum of DOLLARS on the Stated Maturity Date specified above (except to the
extent redeemed or repaid prior to the Stated Maturity Date and except to the
extent extended as provided herein), and to pay interest thereon, at a rate
per annum equal to the Initial Interest Rate specified above from the Original
Issue Date specified above until the Initial Interest Reset Date specified
above and thereafter at the rate or rates per annum determined in accordance
with the provisions hereof, including the provisions under the heading
"Determination of Commercial Paper Rate," "Determination of CD Rate,"
"Determination of Federal Funds Rate," "Determination of LIBOR,"
"Determination of Prime Rate," or "Determination of Treasury Rate", as
applicable depending upon whether the Interest Rate Basis specified above is
Commercial Paper Rate, CD Rate, Federal Funds Rate, LIBOR, Prime Rate,
Treasury Rate, or the lowest of any two or more of such Interest Rate Bases,
as indicated above, until the principal hereof is paid or duly made available
for payment.
The Company shall pay interest monthly, quarterly, semiannually or annually
as specified above under "Interest Payment Period," on each Interest Payment
Date specified above, commencing with the first Interest Payment Date
specified above next succeeding the Original Issue Date specified above, and
on the Stated Maturity Date, or any Redemption Date, Purchase Date or Optional
Repayment Date (in each case as defined
1
<PAGE>
herein) on which this Note is redeemed, repurchased or repaid prior to the
Stated Maturity Date in whole or in part, (each such Stated Maturity Date,
Redemption Date, Purchase Date and Optional Repayment Date are referred to
hereinafter as a "Maturity Date" with respect to principal, premium, if any,
and interest payable on such date); provided, however, unless otherwise
specified herein, if the Original Issue Date specified above is between a
Regular Record Date (as defined herein) and the next succeeding Interest
Payment Date or on an Interest Payment Date, interest payments hereon shall
commence on the Interest Payment Date following the next succeeding Regular
Record Date to the registered Holder of this Note on such next succeeding
Regular Record Date. If any Maturity Date falls on a day that is not a
Business Day (as defined herein), the related payment of principal, premium,
if any, and interest payable with respect to such Maturity Date shall be paid
on the next succeeding Business Day with the same force and effect as if made
on such Maturity Date, and no interest shall accrue on the amount so payable
for the period from and after such Maturity Date. If any day specified above
as an Interest Payment Date (and is not a Maturity Date) is not a Business
Day, then such Interest Payment Date shall be the next succeeding day that is
a Business Day, except that if the Interest Rate Basis or one of the Interest
Rate Bases specified above is LIBOR and such next succeeding Business Day
falls in the next succeeding calendar month, such Interest Payment Date shall
be the next preceding day that is a Business Day. Except as provided above,
interest payments shall be made on the Interest Payment Dates specified above.
Except as indicated above, each "Regular Record Date" shall be the date
fifteen (15) calendar days (whether or not a Business Day) prior to the
applicable Interest Payment Date. Interest on this Note shall accrue from the
most recent Interest Payment Date in respect of which interest has been paid
or duly provided for or, if no interest has been paid, from and including the
Original Issue Date specified above, at the rates determined from time to time
as specified herein, until the principal hereof has been paid or made
available for payment in full. The interest (except defaulted interest) so
payable or duly provided for on any Interest Payment Date shall be paid to the
person in whose name this Note (or one or more predecessor Notes) is
registered at the close of business on the Regular Record Date for such
Interest Payment Date; provided, however, that interest payable on any
Maturity Date shall be payable to the person to whom the principal hereof
shall be payable.
Payment of the principal of, premium, if any, and interest with respect to
this Note shall be made in such coin or currency of the United States of
America as at the time of payment is legal tender for the payment of public
and private debts to the Holder hereof upon presentation of this Note at the
office of the Paying Agent which is currently the Corporate Trust Department
of the Trustee (as defined herein), 101 Barclay Street, Floor 21 West, New
York, New York 10286, or at such other office or agency of the Company in The
City of New York as the Company shall designate by written notice to the
Holder hereof; provided, however, that payment of interest on any Interest
Payment Date (other than a Maturity Date) without presentation of this Note
(i) may be made on each Interest Payment Date by check mailed to the address
of the Holder hereof as of the close of business on the immediately preceding
Regular Record Date at such address as shall appear in the security register
or (ii) or upon receipt by the Paying Agent of appropriate payment
instructions in writing from the Holder hereof (provided such Holder is the
Holder of an aggregate principal amount of Notes, including this Note, of
$10,000,000 or more having the same Interest Payment Dates), not less than
sixteen (16) calendar days prior to such Interest Payment Date, shall be made
by the wire transfer of immediately available funds to such account at a bank
in The City of New York, New York (or other bank consented to by the Company
and the Paying Agent) as the Holder hereof shall have designated in such
instructions so long as such bank has appropriate facilities therefor. Payment
of the principal of, premium, if any, and interest with respect to this Note
will be made on a Maturity Date, upon presentation and surrender of this Note
to the Paying Agent as provided above, (a) in immediately available funds,
provided that this Note is so presented and surrendered in time for the Paying
Agent to make such payment in immediately available funds in accordance with
its normal procedures, or (b) by the wire transfer of immediately available
funds to such account at a bank in The City of New York, New York (or other
bank consented to by the Company and the Paying Agent) as the Holder hereof
shall have designated, provided that such bank has appropriate facilities
therefor and that wire transfer instructions in writing have been received by
the Paying Agent not less than sixteen (16) calendar days prior to such
Maturity Date. If required by applicable law or instructed by the Company or
any governmental agency that taxes or other governmental charges should be
withheld, the Paying Agent shall withhold any such taxes or other governmental
charges on any payments made in connection with this Note.
2
<PAGE>
This Note is one of a duly authorized issue of securities of the Company
issued and to be issued under an Indenture dated as of , 199 (the
"Indenture"), between the Company, as issuer, and The Bank of New York, as
trustee (herein called the "Trustee", which term includes any successor
trustee under the Indenture) which securities may be issued in one or more
series (therein called the "Securities"). The terms of the Notes (as defined
below) include those stated in the Indenture and those made part of the
Indenture by the Trust Indenture Act of 1939, as amended (the "Act").
Reference is hereby made to the Indenture and all indentures supplemental
thereto and the Act for a statement of the respective rights, limitations of
rights, duties and immunities thereunder of the Company, the Trustee and the
Holders of the Securities, and of the terms upon which the Securities are, and
are to be, authenticated and delivered. All terms used and not defined in this
Note which are defined in the Indenture shall have the meanings assigned to
them in the Indenture. This Note is one of the series of Securities designated
Medium-Term Notes Due from Nine Months or more from Date of Issue (Securities
of such series being herein called the "Notes"). The Notes are general
unsecured obligations of the Company.
This Note shall not be subject to any sinking fund and, except as may be
provided in the next three paragraphs, shall not be redeemable or repayable
prior to the Stated Maturity Date. If an Event of Default with respect to the
Notes shall occur and be continuing, the principal amount of, and accrued
interest on, the Notes may be declared or may become due and payable in the
manner and with the effect provided in the Indenture.
If so provided above, this Note may be redeemed at the option of the Company
on any date on and after the Initial Redemption Date, if any, specified above.
If no Initial Redemption Date is set forth above, this Note may not be
redeemed at the option of the Company prior to its Stated Maturity Date. On
and after the Initial Redemption Date, if any, this Note may be redeemed at
any time in whole or from time to time in part in denominations of $1,000
principal amount hereof or any integral multiple of $1,000, (provided that any
remaining principal amount hereof shall be at least $1,000) at the option of
the Company at the applicable Redemption Price (as defined below), together
with accrued and unpaid interest on the principal amount to be redeemed at the
applicable rate to but excluding the date of redemption (each such date a
"Redemption Date"), on notice given by the Company or the Trustee to the
Holder hereof not more than 60 nor less than 30 days prior to the Redemption
Date. Whenever less than all the Notes at any time outstanding are to be
redeemed, the particular Notes to be so redeemed shall be selected by the
Company, provided that if less than all the Notes with identical terms at any
time outstanding are to be redeemed, the Notes to be so redeemed shall be
selected by the Trustee by lot or such other method as the Trustee considers
fair and appropriate. In the event of redemption of this Note in part only, a
new Note for the unredeemed portion hereof shall be issued in the name of the
Holder hereof upon the surrender hereof. The "Redemption Price" shall
initially be the Initial Redemption Percentage, if any, specified above, of
the principal amount of this Note to be redeemed and, if the Initial
Redemption Percentage is greater than 100%, shall decline at each anniversary
of the Initial Redemption Date, specified above, by the Annual Redemption
Percentage Reduction, if any, specified above, of the principal amount to be
redeemed until the Redemption Price is 100% of such principal amount.
If both (i) a Change of Control of the Company shall occur at any time after
the Original Issue Date and on or prior to the Stated Maturity Date (as the
same may be extended as described below) and (ii) on any date during the
period commencing 90 days before and ending 90 days after a public filing has
been made with the Securities and Exchange Commission (the "Commission") or
other general public disclosure has been made indicating the occurrence of
such Change of Control, the then current rating of the Notes by Duff & Phelps
Credit Rating Co. or its successor ("D&P") or by Moody's Investors Service,
Inc. or its successor ("Moody's") is downgraded to lower than BBB-, in the
case of D&P (or an equivalent successor rating or, if the rating of the
Securities by D&P is lower than BBB- (or an equivalent successor rating) at
the beginning of such 180-day period, the rating in effect at the beginning of
such period), or lower than Baa3, in the case of Moody's (or an equivalent
successor rating or, if the rating of the Securities by Moody's is lower than
Baa3 (or an equivalent successor rating) at the beginning of such 180-day
period, the rating in effect at the beginning of such period) and, in the
event that such downgrading shall have occurred during the 90-day period prior
to such public disclosure, the rating assigned to the Notes by D&P or Moody's
(or an equivalent successor rating) as of the
3
<PAGE>
close of business on the date of such public disclosure remains lower than
BBB- or lower than Baa3 (or such lower rating by D&P or Moody's in effect at
the beginning of such 180-day period, as the case may be), respectively (the
occurrence of the conditions specified in both (i) and (ii) above being a "Put
Event"), then the Holder hereof shall have the right, at such Holder's option
and subject to the conditions of Section 4.02 of the Indenture, to require the
Company to repurchase all or any portion of this Note at a purchase price
equal to 100% of the principal amount hereof, plus accrued and unpaid
interest, if any, to the Purchase Date, all as provided in, and subject to the
terms of, the Indenture. The Company will not be obligated, with respect to
the Notes, to purchase Notes or give notice to the Holders thereof with
respect to more than one Put Event.
This Note may be subject to repayment at the option of the Holder hereof on
each Optional Repayment Date, if any, indicated above. If no Optional
Repayment Date is set forth above, this Note may not be so repaid at the
option of the Holder hereof prior to its Stated Maturity Date. On any Optional
Repayment Date this Note shall be repayable in whole or in part in
denominations of $1,000 principal amount hereof or any integral multiple of
$1,000 (provided that any remaining principal amount hereof shall be at least
$1,000), at the option of the Holder hereof at a repayment price equal to 100%
of the principal amount to be repaid, together with accrued and unpaid
interest thereon at the applicable rate to but excluding the date of
repayment. For this Note to be repaid in whole or in part at the option of the
Holder hereof, either (i) this Note must be surrendered, not more than 60 nor
less than 30 days prior to an Optional Repayment Date (except as otherwise
provided in the following fourth succeeding paragraph), with the form entitled
"Option to Elect Repayment" below duly completed, at the office of the Paying
Agent (currently the Corporate Trust Department of the Trustee at 101 Barclay
Street, Floor 21 West, New York, New York 10286), or at such other office or
agency of the Company in The City of New York, New York as the Company shall
designate by written notice to the Holder hereof or (ii) the Paying Agent must
receive at such office, within such period of time prior to an Optional
Repayment Date, a telegram, telex, facsimile transmission or letter from a
member of a national securities exchange or the National Association of
Securities Dealers, Inc. or a commercial bank or trust company in the United
States setting forth the name of the Holder of this Note, the principal amount
of this Note, the principal amount of this Note to be repaid, the certificate
number or a description of the tenor and terms hereof, a statement that the
option to elect repayment is being exercised thereby and a guarantee that this
Note, with the form entitled "Option to Elect Repayment" below duly completed,
will be surrendered to the Paying Agent not later than five Business Days
after the date of such telegram, telex, facsimile transmission or letter and
this Note, with such form duly completed, are received by the Paying Agent by
such fifth Business Day. Exercise of such repayment option by the Holder
hereof shall be irrevocable except as otherwise provided in the following
fourth succeeding paragraph. No transfer or exchange of this Note (or, in the
event that this Note is to be repaid in part, the portion of this Note to be
repaid) shall be permitted after exercise of a repayment option. All questions
as to the validity, eligibility (including time of receipt) and acceptance of
this Note for repayment will be determined by the Company, which determination
shall be final, binding and non-appealable.
This Note may be subject to an extension of its Stated Maturity Date at the
option of the Company for one or more whole year periods, if any, indicated
above (each an "Extension Period") up to but not beyond the date (the "Final
Maturity Date"), if any, indicated above. If this Note may be extended, the
basis or formula, if any, for setting the Spread and/or Spread Multiplier, if
any, for such Extension Period will be as indicated above.
The Company may exercise such option with respect to this Note by notifying
the Trustee of such exercise not more than 60 nor less than 45 days prior to
the Stated Maturity Date in effect prior to the exercise of such option (the
"Original Stated Maturity Date"). No later than 40 days prior to the Original
Stated Maturity Date, the Trustee will mail to the Holder hereof a notice (the
"Extension Notice") relating to such Extension Period, first class, postage
prepaid, setting forth (i) the election of the Company to extend the Stated
Maturity Date, (ii) the new Stated Maturity Date, (iii) any Spread and/or
Spread Multiplier applicable to the Extension Period, and (iv) the provisions,
if any, for redemption at the option of the Company during the Extension
Period, including the date or dates on which or the period or periods during
which and the price or prices at which such redemption may occur during the
Extension Period. Upon the mailing by the Trustee of an Extension Notice to
the Holder hereof, the Stated Maturity Date of this Note shall be extended
automatically as set forth in the Extension Notice,
4
<PAGE>
and except as modified by the Extension Notice and as described in the next
paragraph, such Note will have the same terms as prior to the mailing of such
Extension Notice.
Notwithstanding the foregoing, not later than 20 days prior to the Original
Stated Maturity Date, the Company may, at its option, revoke the Spread and/or
Spread Multiplier in each case, if any, provided for in the Extension Notice
and establish a higher Spread and/or Spread Multiplier in each case, if any,
for the Extension Period by mailing or causing the Trustee to mail notice of
such higher Spread and/or Spread Multiplier by first class mail postage
prepaid to the Holder hereof. Such notice shall be irrevocable. All Notes with
identical terms with respect to which the Stated Maturity Date is extended
will bear such higher Spread and/or Spread Multiplier, as the case may be, for
the Extension Period.
If the Company elects to extend the Stated Maturity Date and if repayment at
the option of the Holder upon such extension is provided for above, the Holder
hereof will have the option to elect repayment of this Note by the Company on
the Original Stated Maturity Date at a price equal to the principal amount
hereof plus any accrued and unpaid interest to such date. In order for a Note
to be so repaid on the Original Stated Maturity Date, the Holder hereof must
follow the procedures set forth herein for optional repayment, except that the
period for delivery of this Note with the "Option to Elect Repayment" form to
the Trustee shall be at least 25 but not more than 35 days prior to the
Original Stated Maturity Date and except that a Holder who has tendered this
Note for repayment pursuant to an Extension Notice may, by written notice to
the Trustee, revoke any such tender for repayment until the close of business
on the tenth day prior to the Original Stated Maturity Date.
This Note shall bear interest at the rate per annum equal to the Initial
Interest Rate specified above from the Original Issue Date specified above
until the Initial Interest Reset Date specified above and thereafter, subject
to the limitations set forth herein, at the rate or rates per annum determined
by reference to the Interest Rate Basis shown above or, if two or more
Interest Rate Bases (other than the Treasury Rate) are shown above, then by
reference to one or more such Interest Rate Bases, in either case adjusted by
(i) adding or subtracting (as indicated above) the Spread, if any, or (ii)
multiplying by the Spread Multiplier, if any, as specified above. The Interest
Rate Basis or Bases shall be the rate determined in accordance with the
applicable provision below. Commencing with the Initial Interest Reset Date
specified above following the Original Issue Date specified above, the rate at
which interest on this Note is payable shall be reset daily, weekly, monthly,
quarterly, semi-annually or annually, as shown above under "Interest Reset
Period", as of each Interest Reset Date specified above. If any Interest Reset
Date would otherwise be a day that is not a Business Day (as defined below),
such Interest Reset Date shall be postponed to the next succeeding day that is
a Business Day, except that if an Interest Rate Basis specified above is LIBOR
and such next Business Day is in the next succeeding calendar month, such
Interest Reset Date shall be the next preceding Business Day.
Interest payable on this Note on any Interest Payment Date shall be equal to
the amount of interest accrued from and including the most recent date to
which interest has been paid or duly provided for (or from and including the
Original Issue Date specified above, if no interest has been paid), to but
excluding the Interest Payment Date for such payment; provided, however, that
if the Interest Reset Period with respect to this Note is daily or weekly,
unless specified herein, interest payable on any Interest Payment Date shall
include interest accrued from and including the Original Issue Date, if no
interest has been paid, or from but excluding the last date in respect of
which interest has been paid or duly provided for, as the case may be, to and
including the Regular Record Date next preceding such Interest Payment Date;
and provided further that the interest payments on a Maturity Date shall
include interest accrued to but excluding such Maturity Date. Accrued interest
hereon shall be an amount calculated by multiplying the principal amount
hereof by an accrued interest factor. Such accrued interest factor shall be
computed by adding the interest factors calculated for each day in the period
for which accrued interest is being calculated. The interest factor (expressed
as a decimal) for each such day shall be computed by dividing the interest
rate in effect for such day by 360 in the case of Notes having as their
Interest Rate Basis the Commercial Paper Rate, the CD Rate, the Federal Funds
Rate, LIBOR or the Prime Rate, or by the actual number of days in the year in
the case of Notes having as their Interest Rate Basis the Treasury Rate. The
interest factor for Notes for which the interest rate is calculated with
reference to two or more Interest
5
<PAGE>
Rate Bases shall be calculated in each period in the same manner as if only
one of the applicable Interest Rate Bases applied.
The interest rate in effect on each day shall be (a) if such day is an
Interest Reset Date, the interest rate determined on the Interest
Determination Date (as defined below) pertaining to such Interest Reset Date
or (b) if such day is not an Interest Reset Date, the interest rate determined
on the Interest Determination Date pertaining to the next preceding Interest
Reset Date, provided that (i) the interest rate in effect for the period from
the Original Issue Date to the Initial Interest Reset Date shall be the
Initial Interest Rate specified above, and (ii) unless otherwise specified
herein, the interest rate in effect for the ten calendar days immediately
prior to a Maturity Date shall be the rate in effect on the tenth calendar day
preceding such Maturity Date.
The "Interest Determination Date" with respect to the Commercial Paper Rate,
the CD Rate, the Federal Funds Rate and the Prime Rate shall be the second
Business Day preceding each Interest Reset Date. The "Interest Determination
Date" with respect to LIBOR shall be the second London Business Day (as
defined below) preceding each Interest Reset Date. The "Interest Determination
Date" with respect to the Treasury Rate (unless otherwise specified above)
shall be the day of the week in which the related Interest Reset Date falls on
which Treasury bills (as defined below), of the Index Maturity specified
above, are auctioned. (Treasury Bills are normally sold at auction on Monday
of each week, unless that day is a legal holiday, in which case the auction is
normally held on the following Tuesday, except that such auction may be held
on the preceding Friday. If, as a result of a legal holiday, an auction is
held on the Friday of the week preceding the related Interest Reset Date, the
related Interest Determination Date shall be such preceding Friday. If an
auction date shall fall on any Interest Reset Date, then the Interest Reset
Date shall instead be the first Business Day following such auction date. If
the interest rate hereon is determined with reference to two or more Interest
Rate Bases, the Interest Determination Date pertaining to this Note shall be
the first Business Day which is at least two Business Days prior to the
related Interest Reset Date on which each Interest Rate Basis shall be
determinable. Each Interest Rate Basis shall be determined on such date, and
the applicable interest rate shall take effect on the related Interest Reset
Date.
Notwithstanding the foregoing, the interest rate on this Note (i) shall not
be greater than the Maximum Interest Rate, if any, or less than the Minimum
Interest Rate, if any, specified above, and (ii) shall in no event be greater
than the maximum rate permitted by New York law, as the case may be modified
by United States law of general application.
The "Calculation Date", if applicable, pertaining to any Interest
Determination Date will be the earlier of (i) tenth calendar day after such
Interest Determination Date or, if such day is not a Business Day, the next
succeeding Business Day or (ii) the Business Day immediately preceding the
applicable Interest Payment Date or Maturity Date, as the case may be.
All percentages resulting from any calculation on this Note shall be
rounded, if necessary, to the nearest one hundred-thousandth of a percentage
point, with five one-millionths of a percentage point rounded upward (e.g.,
9.876545% (or .09876545) would be rounded to 9.87655% (or .0987655)), and all
dollar amounts used in or resulting from such calculation shall be rounded to
the nearest cent (with one-half cent being rounded upward).
As used herein, "Business Day" means any day, other than a Saturday or
Sunday, that is not a day on which banking institutions are authorized or
required by law or regulation to be closed in The City of New York, New York
and, if an Interest Rate Basis for this Note, as indicated above, is LIBOR, is
also a London Business Day. "London Business Day" means any day on which
dealings in deposits in U.S. Dollars are transacted in the London interbank
market.
Determination of Commercial Paper Rate. If an Interest Rate Basis for this
Note is the Commercial Paper Rate, as indicated above, the Commercial Paper
Rate determined with respect to the applicable Interest Determination Date (a
"Commercial Paper Rate Interest Determination Date"), shall be the Money
Market Yield (as defined below) of the rate on such date for commercial paper
having the Index Maturity specified above as
6
<PAGE>
published by the Board of Governors of the Federal Reserve System in
"Statistical Release H.15(519), Selected Interest Rates" or any successor
publication of the Board of Governors of the Federal Reserve ("H.15(519)"),
under the heading "Commercial Paper". In the event such rate is not so
published by 3:00 p.m., New York City time, on the Calculation Date pertaining
to such Commercial Paper Rate Interest Determination Date, then the Commercial
Paper Rate shall be the Money Market Yield of the rate on such Commercial
Paper Rate Interest Determination Date for commercial paper having the Index
Maturity shown above as published by the Federal Reserve Bank of New York in
its daily statistical release "Composite 3:30 p.m. Quotations for U.S.
Government Securities" or any successor publication of the Federal Reserve
Bank of New York ("Composite Quotations") under the heading "Commercial
Paper". If by 3:00 p.m., New York City time, on the related Calculation Date
such rate is not published in either H.15(519) or Composite Quotations, then
the Commercial Paper Rate for such Commercial Paper Rate Interest
Determination Date shall be calculated by a calculation agent which shall be
the Trustee or, if another calculation agent is named above, such calculation
agent (the "Calculation Agent") and shall be the Money Market Yield of the
arithmetic mean (rounded, if necessary, to the nearest one hundred-thousandth
of a percentage point) of the offered rates as of approximately 11:00 a.m.,
New York City time, on such Commercial Paper Rate Interest Determination Date
of three leading dealers of commercial paper (which, unless otherwise
specified above, may include an affiliate of the Calculation Agent or a
selling agent or an underwriter hereof) in The City of New York, New York
selected by the Calculation Agent for commercial paper having the Index
Maturity specified above placed for an industrial issuer whose bond rating is
"AA," or its equivalent, from a nationally recognized securities rating
agency; provided, however, that if the dealers selected as aforesaid by the
Calculation Agent are not quoting as mentioned in this sentence, the
Commercial Paper Rate determined with respect to such Commercial Paper Rate
Interest Determination Date shall be the Commercial Paper Rate determined with
respect to the immediately preceding Commercial Paper Rate Interest
Determination Date or, in the case of the first Commercial Paper Rate Interest
Determination Date, the Initial Interest Rate specified above.
"Money Market Yield" shall be a yield (expressed as a percentage rounded, if
necessary, to the nearest one hundred-thousandth of a percentage point)
calculated in accordance with the following formula:
Money Market Yield = D X 360 X 100
--------------
360 -- (D x M)
where "D" refers to the applicable per annum rate for commercial paper quoted
on a bank discount basis and expressed as a decimal and "M" refers to the
actual number of days in the interest period for which interest is being
calculated.
Determination of CD Rate. If an Interest Rate Basis for this Note is the CD
Rate, as indicated above, the CD Rate determined with respect to the
applicable Interest Determination Date (a "CD Rate Interest Determination
Date") shall be the rate on such date for negotiable certificates of deposit
having the Index Maturity specified above as published in H.15(519), under the
heading "CDs (Secondary Market)", or, if not so published by 3:00 p.m., New
York City time, on the Calculation Date pertaining to such CD Rate Interest
Determination Date, the rate on such CD Rate Interest Determination Date for
negotiable certificates of deposit of the Index Maturity specified above as
published in Composite Quotations under the heading "Certificates of Deposit".
If such rate is not published in either H.15(519) or Composite Quotations by
3:00 p.m., New York City time, on the Calculation Date, then the CD Rate for
such CD Rate Interest Determination Date shall be calculated by the
Calculation Agent and shall be the arithmetic mean (rounded, if necessary, to
the nearest one hundred-thousandth of a percentage point) of the secondary
market offered rates as of approximately 10:00 a.m., New York City time, on
such CD Rate Interest Determination Date of three leading nonbank dealers
(which, unless otherwise specified above, may include an affiliate of the
Calculation Agent or a selling agent or an underwriter hereof) in negotiable
U.S. Dollar certificates of deposit in The City of New York, New York selected
by the Calculation Agent for negotiable certificates of deposit of major
United States money center banks (in the market for negotiable U.S.
certificates of deposit) with a remaining maturity closest to the Index
Maturity designated above in the denomination of U.S. $5,000,000; provided,
however, that if the dealers selected as
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<PAGE>
aforesaid by the Calculation Agent are not quoting mentioned in this sentence,
the CD Rate determined with respect to such CD Rate Interest Determination
Date shall be the CD Rate determined with respect to the immediately preceding
CD Rate Interest Determination Date or, in the case of the first CD Rate
Interest Determination Date, the Initial Interest Rate specified above.
Determination of Federal Funds Rate. If an Interest Rate Basis for this Note
is the Federal Funds Rate, as indicated above, the Federal Funds Rate
determined with respect to the applicable Interest Determination Date (a
"Federal Funds Rate Interest Determination Date"), shall be the rate on that
date for Federal Funds as published in H.15(519) under the heading "Federal
Funds (Effective)" or, if not so published by 3:00 p.m., New York City time,
on the Calculation Date pertaining to such Federal Funds Rate Interest
Determination Date, the rate on such Federal Funds Rate Interest Determination
Date for Federal Funds as published in Composite Quotations under the heading
"Federal Funds/Effective Rate." If such rate is not published in either
H.15(519) or Composite Quotations by 3:00 p.m., New York City time, on the
related Calculation Date, the Federal Funds Rate for such Federal Funds Rate
Interest Determination Date shall be calculated by the Calculation Agent and
shall be the arithmetic mean (rounded, if necessary, to the nearest one
hundred-thousandth of a percentage point) of the rates as of approximately
9:00 a.m., New York City time, on such Federal Funds Rate Interest
Determination Date for the last transaction in overnight Federal Funds
arranged by three leading brokers of Federal Funds transactions in The City of
New York, New York selected by the Calculation Agent; provided, however, that
if the brokers selected as aforesaid by the Calculation Agent are not quoting
as mentioned in this sentence, the Federal Funds Rate determined with respect
to such Federal Funds Rate Interest Determination Date shall be the Federal
Funds Rate determined with respect to the immediately preceding Federal Funds
Rate Interest Determination Date or, in the case of the first Federal Funds
Rate Interest Determination Date, the Initial Interest Rate specified above.
Determination of LIBOR. (i) If an Interest Rate Basis for this Note is
LIBOR, as indicated above, LIBOR determined with respect to any applicable
Interest Determination Date (a "LIBOR Interest Determination Date"), shall be
either: (a) the arithmetic mean (rounded, if necessary, to the nearest one
hundred-thousandth of a percentage point) of the offered rates, as calculated
by the Calculation Agent, for deposits in U.S. Dollars of not less than U.S.
$1,000,000 having the Index Maturity specified above, commencing on the second
London Business Day immediately following such LIBOR Interest Determination
Date, which appear on the Reuters Screen LIBO Page (as defined below) as of
approximately 11:00 a.m., London time, on such LIBOR Interest Determination
Date, if at least two such offered rates appear on the Reuters Screen LIBOR
Page ("LIBOR Reuters"), or (b) the rate for deposits in U.S. Dollars of not
less than U.S. $1,000,000 having the Index Maturity designated in the
applicable Pricing Supplement, commencing on the second London Business Day
immediately following such LIBOR Interest Determination Date, which appears on
the Telerate Page 3750 (as defined below) as of 11:00 a.m., London time, on
such LIBOR Interest Determination Date ("LIBOR Telerate"). "Reuters Screen
LIBO Page" means the display designated as page "LIBO" on the Reuters Monitor
Money Rates Service (or such other page as may replace the LIBO page on that
service for the purpose of displaying London interbank offered rates of major
banks). "Telerate Page 3750" means the display designated as page "3750" on
the Telerate Service (or such other page as may replace the 3750 page on that
service or such other service or services as may be nominated by the British
Bankers' Association for the purpose of displaying London interbank offered
rates for U.S. Dollar deposits). If neither LIBOR Reuters nor LIBOR Telerate
is specified above, LIBOR will be determined as if LIBOR Telerate had been
specified. If fewer than two offered rates appear on the Reuters Screen LIBO
Page, or if no rate appears on the Telerate Page 3750, as applicable, LIBOR in
respect of that LIBOR Interest Determination Date will be determined as if the
parties had specified the rate described in (ii) below.
(ii) With respect to a LIBOR Interest Determination Date on which fewer than
two offered rates appear on the Reuters Screen LIBO Page as specified in
(i)(a) above, or on which no rate appears on Telerate Page 3750, as specified
in (i)(b) above, as applicable, the Calculation Agent shall request the
principal London offices of each of four major reference banks in the London
interbank market selected by the Calculation Agent to provide the Calculation
Agent with a quotation of the rate at which deposits in U.S. Dollars for the
period of the Index Maturity specified above, commencing on the second London
Business Day immediately following such LIBOR
8
<PAGE>
Interest Determination Date, are offered by it to prime banks in the London
interbank market as of approximately 11:00 a.m., London time, on such LIBOR
Interest Determination Date and in a principal amount equal to an amount of
not less than U.S. $1,000,000 that is representative for a single transaction
in such market at such time. If at least two such quotations are provided,
LIBOR with respect to such LIBOR Interest Determination Date shall be the
arithmetic mean (rounded, if necessary, to the nearest one hundred-thousandth
of a percentage point) of such quotations as calculated by the Calculation
Agent. If fewer than two quotations are provided, LIBOR for such LIBOR
Interest Determination Date shall be the arithmetic mean (rounded, if
necessary, to the nearest one hundred-thousandth of a percentage point), as
calculated by the Calculation Agent, of the rates quoted as of approximately
11:00 a.m., New York City time, on such LIBOR Interest Determination Date by
three major banks in The City of New York, New York selected by the
Calculation Agent (after consultation with the Company) for loans in United
States Dollars to leading European banks, having the Index Maturity specified
above commencing on the second London Business Day immediately following such
LIBOR Interest Determination Date and in a principal amount equal to an amount
of not less than U.S. $1,000,000 that is representative for a single
transaction in such market at such time; provided, however, that if the banks
selected as aforesaid by the Calculation Agent are not quoting as mentioned in
this sentence, LIBOR determined with respect to such LIBOR Interest
Determination Date shall be LIBOR determined with respect to the immediately
preceding LIBOR Interest Determination Date or, in the case of the first LIBOR
Interest Determination Date, the Initial Interest Rate specified above.
Determination of Prime Rate. If an Interest Rate Basis for this Note is the
Prime Rate, as indicated above, the Prime Rate determined with respect to the
applicable Interest Determination Date (a "Prime Rate Interest Determination
Date") shall be the arithmetic mean (rounded, if necessary, to the nearest one
hundred-thousandth of a percentage point), as calculated by the Calculation
Agent, of the prime rates quoted on the basis of the actual number of days in
the year divided by 360 as of the close of business on such Prime Rate
Interest Determination Date by three major money center banks in The City of
New York, New York, selected by the Calculation Agent (after consultation with
the Company). If fewer than three such quotations are provided, the Prime Rate
shall be calculated by the Calculation Agent (as described above) on the basis
of the prime rates quoted in The City of New York, New York by the appropriate
number of substitute banks or trust companies organized and doing business
under the laws of the United States of America, or any state thereof, each
having total equity capital of at least U.S. $500,000,000 and being subject to
supervision or examination by a federal or state authority, selected by the
Calculation Agent (after consultation with the Company) to quote such rate or
rates; provided, however, that if the banks or trust companies selected as
aforesaid by the Calculation Agent (after consultation with the Company) are
not quoting as mentioned in this sentence, the Prime Rate determined with
respect to such Prime Rate Interest Determination Date shall be the Prime Rate
determined with respect to the immediately preceding Prime Rate Interest
Determination Date or, in the case of the first Prime Rate Interest
Determination Date, the Initial Interest Rate specified above.
Determination of Treasury Rate. If an Interest Rate Basis for this Note is
the Treasury Rate, as specified above, the Treasury Rate determined with
respect to the applicable Interest Determination Date (a "Treasury Rate
Interest Determination Date") shall be the rate for the most recent auction of
direct obligations of the United States ("Treasury Bills") having the Index
Maturity specified above, as such rate is published in H.15(519), under the
heading "U.S. Government Securities--Treasury Bills--auction average
(investment)" or, if not so published by 3:00 p.m., New York City time, on the
Calculation Date relating to such Treasury Rate Interest Determination Date,
the auction average rate (expressed as a bond equivalent rounded, if
necessary, to the nearest one hundred-thousandth of a percentage point, on the
basis of a year of 365 or 366 days, as applicable, and applied on a daily
basis) as otherwise announced by the United States Department of the Treasury.
In the event that the results of the auction of Treasury bills having the
Index Maturity specified above are not published or announced as described
above by 3:00 p.m., New York City time, on such Calculation Date, or if no
such auction is held in a particular week, then the Treasury Rate for such
Treasury Rate Interest Determination Date shall be calculated by the
Calculation Agent and shall be a yield to maturity (expressed as a bond
equivalent rounded, if necessary, to the nearest one hundred-thousandth of a
percentage point, on the basis of a year of 365 or 366 days, as applicable,
and applied on a daily basis) of the arithmetic mean (rounded, if necessary,
to the nearest one hundred-thousandth of a percentage point) of the secondary
market bid rates, as of approximately
9
<PAGE>
3:30 p.m., New York City time, on such Treasury Rate Interest Determination
Date of three leading primary United States government securities dealers
(which, unless otherwise specified above, may include an affiliate of the
Calculation Agent or a selling agent or an underwriter hereof) selected by the
Calculation Agent (after consultation with the Company), for the issue of
Treasury Bills with a remaining maturity closest to the Index Maturity
specified above; provided, however, that if the dealers selected as aforesaid
by the Calculation Agent are not quoting as mentioned in this sentence, the
Treasury Rate determined with respect to such Treasury Rate Interest
Determination Date shall be the Treasury Rate determined with respect to the
immediately preceding Treasury Rate Interest Determination Date or, in the
case of the first Treasury Rate Interest Determination Date, the Initial
Interest Rate specified above.
The Calculation Agent shall calculate the interest rate hereon in accordance
with the foregoing on or before each Calculation Date. All acts taken by the
Calculation Agent under the Calculation Agency Agreement dated as of ,
199 , between the Company and The Bank of New York (the "Calculation Agent"),
as the Calculation Agent referred to above shall be deemed to have been taken
by the Calculation Agent solely in its capacity as an agent of the Company and
shall not create or imply any obligation to, or any agency or trust
relationship with, the beneficial owners or Holder hereof.
At the request of the Holder hereof, the Calculation Agent shall provide to
the Holder hereof the interest rate hereon then in effect and, if determined,
the interest rate which shall become effective as of the next Interest Reset
Date. Any such calculation shall, absent manifest error, be conclusive and
binding for all purposes.
This Note, and any Note or Notes issued upon transfer or exchange hereof,
may be issued only in fully registered form, without coupons, in denominations
of $1,000 and any integral multiple of $1,000.
As provided in the Indenture and subject to certain limitations therein set
forth (including without limitation the restrictions on exchange under
Sections 2.02 and 2.08 of the Indenture in the event this Note is a global
Security), Notes are exchangeable for a like aggregate principal amount of
Notes of a different authorized denomination and otherwise bearing identical
terms and provisions, as requested by the Holder surrendering the same at the
office of the Registrar in The City of New York, New York designated for such
purpose.
As provided in the Indenture and subject to certain limitations therein set
forth (including without limitation the restrictions on transfer under
Sections 2.02 and 2.08 of the Indenture in the event this Note is a global
Security), the transfer of this Note is registrable in the security register,
upon surrender of this Note for registration of transfer at the office of the
Registrar in The City of New York, New York designated for such purpose, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Registrar duly executed by, the Holder
hereof or his attorney duly authorized in writing, and thereupon one or more
new registered Notes, of authorized denominations and of a like aggregate
principal amount and otherwise bearing identical terms and provisions, will be
issued in the name of the designated transferee or transferees.
No service charge shall be made for any such registration of transfer or
exchange, but the Company or the Registrar may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed
in connection therewith. Initially, the Trustee will act as Registrar and the
office at which Notes must be surrendered for registration of transfer or
exchange is currently the Corporate Trust Department of the Trustee, 101
Barclay Street, Floor 21 West, New York, New York 10286.
Prior to due presentment of this Note 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 Note is registered as the owner hereof for all
purposes of this Note, whether or not this Note shall be overdue, and none of
the Company, the Trustee or any such agent shall be affected by notice to the
contrary.
The Indenture permits, with certain exceptions as therein provided, the
Indenture (insofar as the Notes are concerned) or the Notes to be amended or
supplemented and the rights and obligations of the Company and the rights of
the Holders of Notes to be modified by the Company and the Trustee with the
consent of the Holders
10
<PAGE>
of a majority in principal amount of the Notes at the time outstanding. The
Indenture also contains provisions permitting the Holders of a majority in
principal amount of the outstanding Notes, on behalf of all the Holders of
Notes, to waive compliance by the Company with certain provisions of the
Indenture and certain past defaults under the Indenture and their
consequences, in each case insofar as the Notes are concerned. Any such
consent or waiver by the Holder of this Note shall be conclusive and binding
upon such Holder and upon all future Holders of this Note and of any Note
issued upon the registration of transfer hereof or in exchange herefor or in
lieu hereof, whether or not notation of such consent or waiver is made upon
this Note. Without the consent of any Holder, the Company and the Trustee may
amend or supplement the Indenture or the Notes to cure any ambiguity, defect
or inconsistency or to make certain other specified changes or any change that
does not materially adversely affect the rights of any Holder. Holders of
Notes may not enforce their rights pursuant to the Indenture or the Notes
except as provided in the Indenture.
No reference herein to the Indenture and no provision of this Note or of the
Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of, premium, if any, and
interest on this Note at the times, place and rate, and in the manner and coin
or currency, herein prescribed.
When a successor corporation assumes all the obligations of its predecessor
under the Notes and the Indenture as provided in the Indenture, the
predecessor corporation will be released from these obligations.
A director, officer, employee, or stockholder, as such, of the Company or
the Trustee shall not have any liability for any obligations of the Company or
the Trustee under the Notes or the Indenture or for any claim based on, in
respect of, or by reason of such obligations or their creation. Each Holder by
accepting a Note waives and releases all such liability. The waiver and
release are part of the consideration for the issue of the Notes.
The Indenture and the Notes shall be governed by and construed in accordance
with the laws of the State of New York applicable to agreements made and to be
performed in such State.
Unless the certificate of authentication hereon has been executed by the
Trustee by the manual signature of one of its authorized officers, this Note
shall not be entitled to any benefit under the Indenture (as defined herein)
or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, THE COMPANY HAS CAUSED THIS INSTRUMENT TO BE DULY
EXECUTED, MANUALLY OR BY FACSIMILE.
TCI Communications, Inc.
By: _________________________________
Attest: _____________________________
Secretary
Dated:
CERTIFICATE OF AUTHENTICATION: This
is one of the Securities of the
series designated herein referred
to in the within-mentioned
Indenture.
The Bank of New York
as Trustee
By: _________________________________
Authorized Signatory
11
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations.
TEN COM--as tenants in common
UNIF GIFT MIN ACT-- ..................... Custodian.....................
Under Uniform Gifts to Minors Act
...........................
TEN ENT--as tenants by the entireties
JT TEN--as joint tenants with right of survivorship and not as tenants
in common
Additional abbreviations may also be used though not in the above list.
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) and instruct(s) the Company to
repay this Note (or portion hereof specified below) pursuant to its terms at a
price equal to 100% of the principal amount of this Note (or of such specified
portion) together with interest on the amount to be repaid to the repayment
date, to the undersigned, at:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(Please print or typewrite name and address of the undersigned.)
For this Note to be repaid in whole or in part, the Paying Agent must
receive at 101 Barclay Street, Floor 21 West, New York, New York 10286 (or at
such other place or places in The City of New York, New York of which the
Company shall from time to time notify the Holder of this Note), not more than
60 nor less than 30 days prior to an Optional Repayment Date, if any, shown on
this Note, either (i) this Note with this "Option to Elect Repayment" form
duly completed or (ii) a telegram, telex, facsimile transmission or letter
from a member of a national securities exchange or the National Association of
Securities Dealers, Inc. or a commercial bank or trust company in the United
States setting forth the name of the Holder of this Note, the Principal amount
of this Note, the principal amount of this Note to be repaid, the certificate
number or a description of the tenor and terms hereof, a statement that the
option to elect repayment is being exercised thereby and a guarantee that this
Note, with this "Option to Elect Repayment" form duly completed, will be
surrendered to the Paying Agent not later than five Business Days after the
date of such telegram, telex, facsimile transmission or letter and this Note,
with this form duly completed, are received by the Paying Agent by such fifth
Business Day.
If less than the entire principal amount of this Note is to be repaid,
specify the portion hereof (which shall be denominations of $1,000 principal
amount) which the Holder elects to have repaid and specify the denomination or
denominations (which shall be $1,000 or an integral multiple of $1,000) of the
Notes to be issued to the Holder for the portion of this Note not being repaid
(in the absence of any such specification, one such Note will be issued for
the portion not being repaid).
$ ___________________________________ Signature: __________________________
Date ________________________________ Notice: The signature on this Option
to Elect Repayment must correspond
with the name as written upon the
face of this Note in every
particular, without alteration or
enlargement or any change
whatsoever.
12
<PAGE>
ASSIGNMENT FORM
For Value Received, the undersigned hereby sell(s), assign(s) and transfer(s)
unto
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Please print or typewrite name and address including zip code of assignee and
insert Taxpayer Identification No.)
the attached Note and all rights thereunder, hereby irrevocably constituting
and appointing attorney to transfer said Note on the books of the
issuer, with full power of substitution in the premises.
Dated: ______________________________ Signature: __________________________
Notice: The signature of the
registered owner to this assignment
must correspond with the name as
written upon face of the Note in
every particular, without
alteration or enlargement or any
change whatsoever.
Signature Guarantee: ________________
13
<PAGE>
EXHIBIT 5
OCTOBER 2, 1995
TCI Communications, Inc.
Terrace Tower II
5619 DTC Parkway
Englewood, Colorado 80111-3000
Tele-Communications, Inc.
Terrace Tower II
5619 DTC Parkway
Englewood, Colorado 80111-3000
Gentlemen:
Reference is made to the Registration Statement on Form S-3 (the
"Registration Statement") filed by Tele-Communications, Inc., a Delaware
corporation (the "Parent"), and TCI Communications, Inc., a Delaware
corporation (the "Company"), in connection with the proposed offering from
time to time of (i) senior, senior subordinated or subordinated debt
securities of the Company (the "Debt Securities"), (ii) such indeterminate
number of shares of Tele-Communications, Inc. Series A TCI Group Common Stock,
par value $1.00 per share (the "Parent Stock"), as may be issued from time to
time upon conversion of any of the Debt Securities being registered that are
issued as convertible Debt Securities, and (iii) guarantees of the Parent, if
any, of convertible Debt Securities by Parent (the "Guarantees").
As described in the Registration Statement, the Company may offer Senior
Debt Securities to be issued under an Indenture between the Company and The
Bank of New York, as Trustee (the "BNY Indenture"), Senior Subordinated Debt
Securities to be issued under an Indenture between the Company and a trustee
to be named therein (the "Senior Subordinated Indenture"), or Subordinated
Debt Securities to be issued under an Indenture between the Company and a
trustee to be named therein (the "Subordinated Indenture"), or any combination
of Senior, Senior Subordinated and Subordinated Debt Securities. We have
participated in the preparation and qualification under the Trust Indenture
Act of 1939, as amended, of each of the foregoing Indentures. The BNY
Indenture, the Senior Subordinated Indenture and the Subordinated Indenture
are herein referred to individually as an "Indenture" and collectively as the
"Indentures".
In the event that the Parent elects to guarantee any series of Debt
Securities, the Parent, the Company and the trustee under the Indenture
covering such Debt Securities, will enter into a supplemental indenture to
such Indenture (a "Supplemental Indenture"), and the terms of such Guarantee
will be set forth therein.
In connection herewith, we have examined, among other things, the Restated
Certificate of Incorporation and By-Laws of the Company and the Parent, as
amended; the minutes of the proceedings of the Company's Board of Directors
and the Parent's Board of Directors, including committees of each thereof,
with respect to the filing of the Registration Statement and related matters
(collectively, the "Board Resolutions"); each of the form of BNY Indenture,
the form of Senior Subordinated Indenture and the form of Subordinated
Indenture, and such other documents, records, certificates of public officials
and questions of law as we deemed necessary or appropriate for the purpose of
this opinion. In rendering this opinion, we have assumed that there will be no
changes in applicable law between the date of this opinion and any date of
issuance of Debt Securities, Guarantees or any date of issuance or delivery of
Parent Stock upon the conversion of any Debt Securities that are convertible.
Based upon the foregoing, we are of the opinion that:
1. The Debt Securities and Guarantees, if any, issued under any of the
Indentures, when (i) the applicable Indenture (and, if applicable, any
Supplemental Indenture) has been executed and delivered by
<PAGE>
the parties thereto, (ii) the definitive terms of such Debt Securities and
Guarantees, if any, and of their issue and sale have been duly established
in accordance with the Board Resolutions and the provisions of the
applicable Indenture (and, if applicable, any Supplemental Indenture) so as
not to violate any applicable law or agreement or instrument then binding
on the Company (in the case of the Debt Securities) or the Parent (in the
case of any Guarantee), (iii) such Debt Securities (with the Guarantees, if
any, duly executed and endorsed thereon) have been duly executed by the
proper officers of the Company and authenticated by the Trustee or Trustees
for the series to be issued in accordance with the applicable Indenture
(and, if applicable, any Supplemental Indenture) and (iv) such Debt
Securities and Guarantees, if any, have been issued and sold as
contemplated in the Registration Statement, the prospectus contained
therein and the applicable supplement to the prospectus, such Debt
Securities and Guarantees, if any, will be legally issued, valid and
binding obligations of the Company and the Parent, respectively, except as
enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium and other laws affecting
the rights of creditors generally and except that equitable remedies may
not be available.
2. When any convertible Debt Securities that have been issued in
accordance with paragraph 1. above have been surrendered to the Company for
conversion in accordance with the applicable Indenture and the shares of
Parent Stock issuable upon such conversion have been duly issued or
delivered from shares of Parent Stock reserved therefor in accordance with
the Board Resolutions, such shares of Parent Stock will be legally issued,
fully paid and non-assessable.
We hereby consent to the filing of this opinion as Exhibit 5 to the
Registration Statement and to the reference to us contained therein under the
heading "Legal Matters." In giving the foregoing consent, we do not admit that
we are in the category of persons whose consent is required under Section 7 of
the Securities Act of 1933, as amended, or the rules and regulations of the
Securities and Exchange Commission promulgated thereunder.
Jerome H. Kern, a partner of Baker & Botts, L.L.P., is a director of the
Parent.
Very truly yours,
Baker & Botts, L.L.P.
2
<PAGE>
EXHIBIT 8
October 2, 1995
TCI Communications, Inc.
Terrace Tower II
5619 DTC Parkway
Englewood, Colorado 80111-3000
Gentlemen:
Reference is made to the Registration Statement on Form S-3 (the
"Registration Statement") filed by Tele-Communications, Inc., a Delaware
corporation (the "Parent"), and TCI Communications, Inc., a Delaware
corporation (the "Company"), in connection with the proposed offering from
time to time of (i) senior, senior subordinated or subordinated debt
securities of the Company (the "Debt Securities"), (ii) such indeterminate
number of shares of Tele-Communications, Inc. Series A TCI Group Common Stock,
par value $1.00 per share (the "Parent Stock"), as may be issued from time to
time upon conversion of any of the Debt Securities being registered that are
issued as convertible Debt Securities, and (iii) guarantees, if any, of Debt
Securities by Parent (the "Guarantees").
We refer to the Registration Statement, including the prospectus (the "Basic
Prospectus") forming a part of the Registration Statement and to the
prospectus supplement thereto included in the Registration Statement (the
"Prospectus Supplement" and, together with the Basic Prospectus, the
"Prospectus") relating to the offering of a series of the Company's senior
Debt Securities designated as its "Medium-Term Notes, Series C Due From Nine
Months or More From Date of Issue" (the "Medium-Term Notes"). The Medium-Term
Notes will be denominated in U.S. Dollars or, subject to the filing pursuant
to Rule 424(b) under the Act of an additional supplement to the Prospectus (a
"Multi-Currency Prospectus Supplement"), in one or more foreign currencies or
foreign currency units.
In connection therewith, we have examined, among other things, the
Registration Statement and the Prospectus, and we have conducted such research
as we have deemed necessary or appropriate for the purpose of this opinion. We
are also familiar with the discussion in the Prospectus Supplement appearing
under the caption "Certain United States Tax Considerations".
Based on the foregoing, we are of the opinion that the summary in the
Prospectus under the caption "Certain United States Tax Considerations"
correctly describes the material United States federal income tax consequences
of the ownership of Medium-Term Notes denominated in U.S. Dollars as of the
date hereof.
Except as stated above, we express no opinion with respect to any other
matter including, without limitation, any additional tax consequences specific
to the ownership of Medium-Term Notes denominated in one or more foreign
currencies or currency units. We understand that any additional material
United States federal income tax consequences that are specific to the
ownership of Medium-Term Notes denominated in one or more foreign currencies
or currency units will be summarized in a Multi-Currency Prospectus Supplement
relating to such Medium-Term Notes. We are furnishing this opinion to you
solely in connection with the offering, issuance and sale of the Medium-Term
Notes in the manner described in the Prospectus and subject to your taking any
other necessary actions in connection therewith including the filing with the
Securities and Exchange Commission of one or more pricing supplements to the
Prospectus, and this opinion is not to be relied upon, circulated, quoted, or
otherwise referred to for any other purpose without our prior written consent.
We hereby consent to the filing of this opinion as Exhibit 8 to the
Registration Statement. In giving the foregoing consent, we do not admit that
we are in the category of persons whose consent is required under Section 7 of
the Act.
Very truly yours,
BAKER & BOTTS, L.L.P.
<PAGE>
EXHIBIT 12
TCI COMMUNICATIONS, INC.
AND CONSOLIDATED SUBSIDIARIES
CALCULATION OF RATIOS OF EARNINGS TO FIXED CHARGES
(AMOUNTS IN MILLIONS, EXCEPT FOR RATIOS)
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS
YEAR ENDED DECEMBER 31, ENDED JUNE 30,
------------------------------------ -----------------
1994 1993(A) 1992(A) 1991 1990 1995 1994(A)
------ ------- ------- ----- ----- ------ --------
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings (losses) from
continuing operations
before income taxes.... $ 223 161 45 (108) (308) (34) 90
Add:
Interest on debt...... 777 738 815 928 990 464 367
Interest portion of
rentals.............. 25 23 22 23 23 12 12
Amortization of debt
expense.............. 12 12 9 6 6 6 5
Distributions from and
(earnings) losses of
less than 50%-owned
affiliates with debt
not guaranteed by
TCIC................. (20) 26 (10) (27) 34 24 (11)
Minority interests in
earnings (losses) of
consolidated
subsidiaries,
including preferred
stock dividend
requirement of
consolidated
subsidiaries......... 8 13 277 24 (63) (3) 4
Elimination of
preferred stock
dividend requirement
of consolidated
subsidiaries to 50%-
owned affiliates..... -- -- (250) (42) (36) -- --
Preferred stock
dividend requirements
of 50%-owned
affiliates, other
than amounts to
TCIC................. -- -- 175 23 15 -- --
------ ---- ----- ----- ----- ------ -------
Earnings available for
fixed charges........ $1,025 973 1,083 827 661 469 467
====== ==== ===== ===== ===== ====== =======
Fixed charges:
Interest on debt:
TCIC and consolidated
subsidiaries......... $ 777 731 718 826 868 464 363
Elimination of
interest of
consolidated
subsidiaries to 50%-
owned affiliates..... -- -- (36) (47) (51) -- --
TCIC's proportionate
share of interest of
50%-owned
affiliates........... 0 7 133 149 173 0 4
------ ---- ----- ----- ----- ------ -------
777 738 815 928 990 464 367
Interest portion of
rentals.............. 25 23 22 23 23 12 12
Amortization of debt
expense.............. 12 12 9 6 6 6 5
Preferred stock
dividend requirements
of consolidated
subsidiaries......... 10 14 281 61 56 4 7
Elimination of
preferred stock
dividend requirements
of consolidated
subsidiaries to 50%-
owned affiliates..... -- -- (250) (42) (36) -- --
Preferred stock
dividend requirements
of 50%-owned
affiliates, other
than amounts to
TCIC................. -- -- 175 23 15 -- --
Capitalized interest.. 15 9 6 5 6 5 6
------ ---- ----- ----- ----- ------ -------
Total fixed charges... $ 839 796 1,058 1,004 1,060 491 397
====== ==== ===== ===== ===== ====== =======
Ratio of earnings to
fixed charges........ 1.22 1.22 1.02 -- -- 1.18
Deficiency............ $ -- -- -- (177) (399) (22) --
</TABLE>
- --------
(a) Preferred stock dividend requirements have been increased to an amount
representing the pretax earnings which would be required to cover such
dividend requirements. The effective income tax rate utilized for purposes
of increasing preferred stock dividend requirements in 1993 has been
adjusted to exclude the effect of the federal income tax rate change in the
third quarter of 1993.
<PAGE>
TCI COMMUNICATIONS, INC.
AND CONSOLIDATED SUBSIDIARIES
CALCULATION OF RATIOS OF EARNINGS TO FIXED CHARGES
(AMOUNTS IN MILLIONS, EXCEPT FOR RATIOS)
(UNAUDITED)
Fixed charges related to interest on debt of less than 50%-owned affiliates
guaranteed by TCIC:
<TABLE>
<S> <C>
Years ended December 31,
1990.............................................................. $ 710
1991.............................................................. 506
1992.............................................................. 2,517
1993.............................................................. 13,833
1994.............................................................. 12,471
Three months ended March 31,
1994.............................................................. 3,458
1995.............................................................. 3,336
Six months ended June 30,
1994.............................................................. 5,927
1995.............................................................. 6,673
</TABLE>
2
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the registration statement
on Form S-3 of TCI Communications, Inc. and Tele-Communications, Inc. of our
reports dated March 27, 1995, relating to the consolidated balance sheets of
Tele-Communications, Inc. and subsidiaries as of December 31, 1994 and 1993,
and the related consolidated statements of operations, stockholders' equity,
and cash flows for each of the years in the three-year period ended December
31, 1994, and the related financial statement schedules, which reports appear
in the December 31, 1994 Annual Report on Form 10-K, as amended, of Tele-
Communications, Inc. and to the reference to our firm under the heading
"Experts" in the registration statement. Our reports covering the December 31,
1994 consolidated financial statements refer to the adoption of Statement of
Financial Accounting Standards No. 115, "Accounting for Investments in Certain
Debt and Equity Securities," in 1994.
KPMG Peat Marwick LLP
Denver, Colorado
September 29, 1995
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the registration statement on
Form S-3 of TCI Communications, Inc. and Tele-Communications, Inc. of our
reports dated March 27, 1995, relating to the consolidated balance sheets of
TCI Communications, Inc. (formerly Tele-Communications, Inc.) and subsidiaries
as of December 31, 1994 and 1993, and the related consolidated statements of
operations, stockholders'(s') equity, and cash flows for each of the years in
the three-year period ended December 31, 1994, and the related financial
statement schedules, which reports appear in the December 31, 1994 Annual
Report on Form 10-K, as amended, of TCI Communications, Inc. and to the
reference to our firm under the heading "Experts" in the registration
statement. Our reports covering the December 31, 1994 consolidated financial
statements refer to the adoption of Statement of Financial Accounting Standards
No. 115, "Accounting for Investments in Certain Debt and Equity Securities," in
1994.
KPMG Peat Marwick LLP
Denver, Colorado
September 29, 1995
<PAGE>
EXHIBIT 23.3
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the registration statement on
Form S-3 of Tele-Communications, Inc. and TCI Communications, Inc. of our
reports dated 21 March, 1995, relating to the consolidated balance sheet of
TeleWest Communications plc and subsidiaries as of 31 December 1994 and 1993,
and the related consolidated statements of operations and cash flows for each
of the years in the three-year period ended 31 December 1994 which report
appears in the 31 December 1994 Annual Report on Form 10-K Tele-Communications,
Inc., as amended, and to the reference to our firm under the heading "Experts"
in the registration statement.
KPMG
London, England
September 29, 1995
<PAGE>
EXHIBIT 23.4
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the registration statement
of Tele-Communications, Inc. and TCI Communications, Inc. of our report, dated
March 24, 1995, relating to the combined balance sheets of Cablevision (a
combination of certain cable television assets of Cablevision S.A., Televisora
Belgrano S.A., Construred S.A. and Univent's S.A.) as of December 31, 1994 and
1993, and the related combined statements of operations and deficit and cash
flows for each of the years in the three-year period ended December 31, 1994,
which appear in the Current Report on Form 8-K of Tele-Communications, Inc.
dated April 20, 1995, as amended, and to the reference to our firm under the
heading "Experts" in the registration statement.
KPMG Finsterbusch Pickenhayn Sibille
Buenos Aires, Argentina
September 29, 1995
<PAGE>
EXHIBIT 23.5
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the registration statement on
Form S-3 of Tele-Communications, Inc. and TCI Communications, Inc. of our
report, dated March 5, 1994, relating to the consolidated balance sheets of
QVC, Inc. and subsidiaries as of January 31, 1994 and 1993, and the related
consolidated statements of operations, shareholders' equity, and cash flows for
each of the years in the three-year period ended January 31, 1994, which report
appears in the Current Report on Form 8-K of Tele-Communications, Inc. dated
February 3, 1995, as amended, and to the reference to our firm under the
heading "Experts" in the registration statement. Our report refers to a change
in the method of accounting for income taxes.
KPMG Peat Marwick LLP
Philadelphia, Pennsylvania
September 29, 1995
<PAGE>
EXHIBIT 23.6
CONSENT OF INDEPENDENT AUDITORS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of the Registration Statement on Form S-3 of TCI
Communications, Inc. and Tele-Communications, Inc. of our report dated February
4, 1994, relating to the consolidated financial statements of TeleCable
Corporation which appears on page 12 of the TCI Communications, Inc. and Tele-
Communications, Inc. Current Report on Form 8-K dated August 26, 1994. We also
consent to the reference to us under the heading "Experts" in such Prospectus.
Price Waterhouse LLP
Norfolk, Virginia
September 29, 1995
<PAGE>
THIS CONFORMING PAPER FORMAT DOCUMENT IS BEING SUBMITTED
PURSUANT TO RULE 901(D) OF REGULATION S-T
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
EXHIBIT 25.1
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) [_]
----------------
THE BANK OF NEW YORK
(EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER)
NEW YORK 13-5160382
(STATE OF INCORPORATION IF NOT A U.S. I.R.S. EMPLOYER
NATIONAL BANK) IDENTIFICATION NO.)
48 WALL STREET, NEW YORK, N.Y. 10286
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
----------------
TCI COMMUNICATIONS, INC.
(EXACT NAME OF OBLIGOR AS SPECIFIED IN ITS CHARTER)
DELAWARE
(STATE OR OTHER JURISDICTION OF 84-0588868
INCORPORATION OR ORGANIZATION) (I.R.S. EMPLOYER
IDENTIFICATION NO.)
TERRACE TOWER II 80111-3000
5619 DTC PARKWAY (ZIP CODE)
ENGLEWOOD, COLORADO
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
----------------
TELE-COMMUNICATIONS, INC.
(EXACT NAME OF OBLIGOR AS SPECIFIED IN ITS CHARTER)
DELAWARE 84-1260157
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
TERRACE TOWER II 80111-3000
5619 DTC PARKWAY (ZIP CODE)
ENGLEWOOD, COLORADO
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
----------------
DEBT SECURITIES
(TITLE OF THE INDENTURE SECURITIES)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
1. GENERAL INFORMATION. Furnish the following information as to the Trustee:
(a) Name and address of each examining or supervising authority to which
it is subject.
<TABLE>
<CAPTION>
NAME ADDRESS
---- -------
<S> <C>
Superintendent of Banks of the 2 Rector Street, New York, N.Y. 10006,
State of New York and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York, N.Y. 10045
Federal Deposit Insurance Washington, D.C. 20429
Corporation
New York Clearing House New York, New York
Association
</TABLE>
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None. (See Note on page 3.)
16. LIST OF EXHIBITS.
Exhibits identified in parentheses below, on file with the Commission, are
incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-
29 under the Trust Indenture Act of 1939 (the "Act") and Rule 24 of the
Commission's Rules of Practice.
1. A copy of the Organization Certificate of The Bank of New York (formerly
Irving Trust Company) as now in effect, which contains the authority to
commence business and a grant of powers to exercise corporate trust
powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with
Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed
with Registration Statement No. 33-21672 and Exhibit 1 to Form T-1 filed
with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No. 33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
NOTE
Inasmuch as this Form T-1 is filed prior to the ascertainment by the Trustee
of all facts on which to base a responsive answer to Item 2, the answer to
said Item is based on incomplete information.
Item 2 may, however, be considered as correct unless amended by an amendment
to this Form T-1.
2
<PAGE>
SIGNATURE
PURSUANT TO THE REQUIREMENTS OF THE ACT, THE TRUSTEE, THE BANK OF NEW YORK,
A CORPORATION ORGANIZED AND EXISTING UNDER THE LAWS OF THE STATE OF NEW YORK,
HAS DULY CAUSED THIS STATEMENT OF ELIGIBILITY TO BE SIGNED ON ITS BEHALF BY
THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, ALL IN THE CITY OF NEW YORK, AND
STATE OF NEW YORK, ON THE 22ND DAY OF SEPTEMBER, 1995.
The Bank of New York
/s/ Mary Lagumina
By: _________________________________
Name: Mary Lagumina
Title: Assistant Vice President
3
<PAGE>
EXHIBIT 7
CONSOLIDATED REPORT OF CONDITION OF
THE BANK OF NEW YORK
OF 48 WALL STREET, NEW YORK, N.Y. 10286
And Foreign and Domestic Subsidiaries, a member of the Federal Reserve
System, at the close of business June 30, 1995, published in accordance with a
call made by the Federal Reserve Bank of this District pursuant to the
provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
DOLLAR AMOUNTS
IN THOUSANDS
--------------
<S> <C>
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin............ $ 3,025,419
Interest-bearing balances..................................... 861,413
Securities:
Held-to-maturity securities................................... 1,242,368
Available-for-sale securities................................. 1,774,079
Federal funds sold in domestic offices of the bank............. 5,503,445
Securities purchased under agreements to resell................ 300,634
Loans and lease financing receivables:
Loans and leases, net of unearned income............26,599,533
LESS: Allowance for loan and lease losses..............516,283
Loans and leases, net of unearned income and allowance ....... 26,083,250
Assets held in trading accounts................................ 1,455,639
Premises and fixed assets (including capitalized leases)....... 612,547
Other real estate owned........................................ 79,667
Investments in unconsolidated subsidiaries and associated
companies .................................................... 196.737
Customers' liability to this bank on acceptances outstanding .. 1,111,464
Intangible assets ............................................. 105,263
Other assets .................................................. 1,237,264
-----------
Total assets .................................................. $43,511,189
===========
LIABILITIES
Deposits:
In domestic offices .......................................... $19,233,885
Noninterest-bearing .................................7,677,954
Interest-bearing ...................................11,555,931
In foreign offices, Edge and Agreement subsidiaries, and IBFs
............................................................. 12,641,676
Noninterest-bearing ....................................72,479
Interest-bearing ...................................12,569,197
Federal funds purchased and securities sold under agreements to
repurchase in domestic offices of the bank and of its Edge and
Agreement subsidiaries, and in IBFs:
Federal funds purchased ...................................... 1,747,659
Securities sold under agreements to repurchase ............... 73,553
Demand notes issued to the U.S. Treasury ...................... 300,000
Trading liabilities ........................................... 738,317
Other borrowed money:
With original maturity of one year or less ................... 1,586,443
With original maturity of more than one year ................. 220,877
Bank's liability on acceptances executed and outstanding ...... 1,113,102
Subordinated notes and debentures ............................. 1,053,860
Other liabilities ............................................. 1,489,252
-----------
Total liabilities ............................................. 40,198,624
-----------
EQUITY CAPITAL
Common stock .................................................. 942,284
Surplus ....................................................... 525,666
Undivided profits and capital reserves ........................ 1,849,221
Net unrealized holding gains (losses) on available-for-sale
securities ................................................... (662)
Cumulative foreign currency translation adjustments ........... (3,944)
-----------
Total equity capital .......................................... 3,312,565
-----------
Total liabilities and equity capital .......................... $43,511,189
===========
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of the above-
named bank do hereby declare that this Report of Condition has been prepared
in conformance with the instructions issued by the Board of Governors of the
Federal Reserve System and is true to the best of my knowledge and belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
J. Carter Bacot
Thomas A. Renyi Directors
Samuel F. Chevalier
4
