<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 13, 1999
REGISTRATION STATEMENT NO. 333-
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
PHARMACIA & UPJOHN, INC.
(EXACT NAME OF ISSUER AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C> <C>
DELAWARE 2834 98-0155411
(STATE OR OTHER JURISDICTION (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER IDENTIFICATION NO.)
OF INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER)
</TABLE>
------------------------
95 CORPORATE DRIVE
BRIDGEWATER, NEW JERSEY 08807
(908) 306-4400
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
-------------------------
DON W. SCHMITZ, ESQ.
PHARMACIA & UPJOHN, INC.
95 CORPORATE DRIVE
BRIDGEWATER, NEW JERSEY 08807
(908) 306-4400
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
-------------------------
COPIES TO:
<TABLE>
<S> <C>
ANDREW D. SOUSSLOFF, ESQ. MARC M. ROSSELL, ESQ.
SULLIVAN & CROMWELL SHEARMAN & STERLING
125 BROAD STREET 599 LEXINGTON AVENUE
NEW YORK, NEW YORK 10004 NEW YORK, NEW YORK 10022
(212) 558-4000 (212) 848-4000
</TABLE>
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after this Registration Statement becomes effective.
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. [ ]
------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
PROPOSED PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO BE MAXIMUM OFFERING AGGREGATE OFFERING
SECURITIES TO BE REGISTERED REGISTERED(1) PRICE PER UNIT(2) PRICE(2)
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Debt Securities(3).............................. 100%
- ------------------------------------------------ ---------------------
Debt Warrants(3)................................ $1,000,000,000(4) -- $1,000,000,000(4)(5)
- ------------------------------------------------ ---------------------
Preferred Stock(3).............................. --
- ------------------------------------------------ ---------------------
Common Stock(3)................................. --
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
<CAPTION>
- ------------------------------------------------ ----------------------
- ------------------------------------------------ ----------------------
TITLE OF EACH CLASS OF AMOUNT OF
SECURITIES TO BE REGISTERED REGISTRATION FEE
- ------------------------------------------------ ----------------------
<S> <C>
Debt Securities(3)..............................
- ------------------------------------------------
Debt Warrants(3)................................ $278,000
- ------------------------------------------------
Preferred Stock(3)..............................
- ------------------------------------------------
Common Stock(3).................................
- -----------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) In United States dollars or the equivalent thereof in one or more other
currencies, currency units or composite currencies.
(2) Estimated for the sole purpose of computing the registration fee in
accordance with Rule 457(o).
(3) Also includes such indeterminate amounts of Debt Securities, Debt Warrants,
Preferred Stock and Common Stock as may be issued upon conversion of or
exchange for any other securities that provide for conversion or exchange
into Debt Securities, Debt Warrants, Preferred Stock or Common Stock.
(4) Such amount represents the principal amount of Debt Securities issued at
their principal amount, the issue price rather than the principal amount of
any Debt Securities issued at an original issue discount, the issue price of
any Debt Warrants, the issue price of any Debt Securities issuable upon the
exercise of Debt Warrants, the liquidation preference of any Preferred Stock
and the issue price of any Common Stock.
(5) No separate consideration will be received for the Debt Securities, Debt
Warrants, Preferred Stock or Common Stock issuable upon conversion of, or in
exchange for, Debt Securities and Preferred Stock.
------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 2
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND IT IS NOT THE SOLICITATION OF AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
SUBJECT TO COMPLETION. DATED JULY 13, 1999.
PROSPECTUS
$1,000,000,000
[LOGO]
PHARMACIA &
UPJOHN
DEBT SECURITIES
DEBT WARRANTS
PREFERRED STOCK
COMMON STOCK
-------------------------
Pharmacia & Upjohn, Inc. may offer and sell debt securities, debt
warrants, shares of preferred stock or shares of common stock. These securities
may be offered and sold from time to time for an aggregate offering price of up
to $1,000,000,000 (or the equivalent amount in other currencies or currency
units). We will provide the specific terms and the initial public offering
prices of these securities in an accompanying prospectus supplement.
We may sell the securities to or through underwriters and also to other
purchasers or through agents. The names of any underwriters or agents will be
stated in an accompanying prospectus supplement.
See "Risk Factors" beginning on page 5 to read about certain factors you
should consider before investing in the securities.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY OTHER REGULATORY
BODY HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY
OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
THE DATE OF THIS PROSPECTUS IS , 1999.
<PAGE> 3
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
U.S. Securities and Exchange Commission using a shelf registration process.
Under this shelf process, we may sell any combination of the securities
described in this prospectus in one or more offerings up to a total of
$1,000,000,000 (or the equivalent amount in other currencies or currency units).
This prospectus provides you with a general description of the securities
we may offer. Each time we sell securities, we will provide a prospectus
supplement that will contain specific information about the terms of that
offering. The prospectus supplement may also add to or update other information
contained in this prospectus. You should read both this prospectus and the
accompanying prospectus supplement together with additional information
described below under the heading "Where You Can Find More Information".
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. Our SEC filings are available to the public over the
Internet at the SEC's web site at http://www.sec.gov. You may also read and copy
any document we file at the SEC's public reference rooms in Washington, D.C.,
New York, New York and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330
for further information on the public reference rooms. You may also inspect our
SEC reports and other information at the New York Stock Exchange, Inc., 20 Broad
Street, New York, New York 10005, on which our common stock is listed.
The SEC allows us to incorporate by reference the information we file with
them, which means:
- incorporated documents are considered part of the prospectus;
- we can disclose important information to you by referring you to those
documents; and
- information that we file with the SEC will automatically update and
supersede this incorporated information.
We incorporate by reference the documents listed below which were filed
with the SEC and any future filings made with the SEC under Sections 13(a), 14
or 15(d) of the Securities Exchange Act of 1934 until we sell all of the
securities:
1. Our Annual Report on Form 10-K for the year ended December 31, 1998;
2. Our Quarterly Report on Form 10-Q for the three-month period ended March
31, 1999;
3. Our Current Report on Form 8-K, filed with the SEC on July 1, 1999;
4. The description of our common stock contained in our Registration
Statement on Form 8-A filed on October 24, 1995; and
5. The description of the rights to purchase our participating preferred
stock contained in our Registration Statement on Form 8-A filed on March
5, 1997.
You may request a copy of these filings at no cost by writing or
telephoning us at the following address and telephone number:
Pharmacia & Upjohn, Inc.
95 Corporate Drive,
Bridgewater, New Jersey 08807
Attention: Investor Relations
Telephone: (908) 306-4400.
You should rely only on the information incorporated by reference or
provided in this prospectus or any prospectus supplement. We
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<PAGE> 4
have not authorized anyone else to provide you with different information. We
are not making an offer of these securities in any state where the offer is not
permitted. You should not assume that the information in this prospectus or any
prospectus supplement is accurate as of any date other than the date on the
front cover of those documents.
FORWARD-LOOKING STATEMENTS
In addition to historical information, this prospectus contains (or
incorporates by reference) certain "forward-looking statements", such as
statements concerning our anticipated financial or product performance, our
ability to pay dividends and other non-historical facts. Since these statements
are based on factors that involve risks and uncertainties, actual results may
differ materially from those expressed or implied by such forward-looking
statements. Such factors include, among others:
- sales and earnings projections;
- the effectiveness of current and future projects and their estimated
expenses, including restructuring plans, the Year 2000 date recognition
problem and conversion to the euro;
- management's ability to make further progress under our global turnaround
plan;
- our ability to successfully market new and existing products in new and
existing domestic and international markets;
- the success of our research and development activities and the speed at
which we achieve regulatory authorizations and product rollouts;
- fluctuations in currency exchange rates;
- the effects of our accounting policies and changes in generally accepted
accounting practices;
- our exposure to product liability lawsuits and contingencies related to
actual or alleged environmental contamination;
- our exposure to antitrust lawsuits;
- domestic and foreign social, legal and political developments, especially
those relating to health care reform and product liabilities;
- general economic and business conditions;
- our ability to attract and retain current management and other employees;
and
- other risks and factors detailed in this prospectus and the documents we
have incorporated by reference in this prospectus.
3
<PAGE> 5
PHARMACIA & UPJOHN, INC.
Pharmacia & Upjohn, Inc. is a global pharmaceutical group that researches,
develops, manufactures and sells human pharmaceutical products, nonprescription
drugs, pharmaceutical chemicals and intermediate products for use in our
products and sale to others, and pharmaceutical products for animals. These
products form our core business and are called the pharmaceutical segment.
Our other businesses are called the nonpharmaceutical segment and include
specialty products for hospital care, medical diagnostics and nutritional
supplements, as well as investments in our biotechnology affiliates. We sold
most of our nutritional business in late 1998 and plan to sell our remaining
nutritional businesses in China and Germany in the future.
Pharmacia & Upjohn, Inc. was formed in November 1995 through the
combination of Pharmacia Aktiebolag and The Upjohn Company.
Our principal products include XALATAN(R), a novel therapy for glaucoma;
DETROL(R), an innovative therapy for overactive bladder; GENOTROPIN(TM), a human
growth hormone; XANAX(R), a therapy for central nervous system disorders;
CLEOCIN(R), an antibiotic; MEDROL, a group of products to treat chronic
inflammation disorders; DEPOPROVERA(TM), a contraceptive injection;
NICORETTE(R), a line of nicotine replacement products; CAMPTOSAR(R), a therapy
for colorectal cancer; FRAGMIN(R), a therapy for preventing blood clots;
PHARMORUBICIN(R), a treatment for solid tumors and leukemia;
MIRAPEX/MIRAPEXIN(TM), a treatment for Parkinson's disease; and ROGAINE(R), a
non-prescription treatment for hair loss.
Through research and development and licensing agreements, we seek to
develop innovative pharmaceuticals and other health care products that provide
high therapeutic benefits. Our research activities focus on four medically
important areas: infectious disease, metabolic disease, central nervous system
disorders and oncology. Our research is conducted primarily in Kalamazoo,
Michigan, Stockholm, Sweden and Milan, Italy.
On June 15, 1999, Pharmacia & Upjohn, Inc. entered into an agreement to
merge with SUGEN, Inc., a biotechnology company based in South San Francisco,
California, at a cost of approximately $650 million of Pharmacia & Upjohn stock.
We believe that the merger with SUGEN, a leader in target-driven drug discovery
and the development of cancer therapies, will enhance our core research
capabilities and enable us to provide new therapeutic approaches to the
treatment of cancer.
4
<PAGE> 6
RISK FACTORS
Prior to making an investment decision, prospective investors should
carefully consider all of the information set forth in this prospectus,
including the information incorporated by reference in this prospectus and the
following risk factors.
WE FACE INTENSE COMPETITION FROM NEW PRODUCTS AND FROM LOWER COST GENERIC
PRODUCTS
The pharmaceutical industry is highly competitive and rapidly changing. Our
principal competitors are major international corporations with substantial
resources for research and development, production and marketing.
Our products that are under patent protection face intense competition from
competitors' proprietary products. This competition may increase as new products
enter the market. We also face increasing competition from lower cost generic
products after patents on our products expire.
As new products enter the market, our products may become obsolete or our
competitors' products may be more effective or more effectively marketed and
sold than our products.
If we fail to maintain our competitive position, this could have a material
adverse effect on our business and results of operations.
PRICE CONTROLS CAN LIMIT OUR REVENUES AND ADVERSELY AFFECT OUR BUSINESS AND
RESULTS OF OPERATIONS
In addition to normal price competition in the marketplace, the prices of
our products are restricted by price controls imposed by governments and health
care providers in most countries where we sell products. Price controls operate
differently in different countries and can cause wide differences in prices
between markets. Currency fluctuations can aggravate these differences. The
existence of price controls can limit the revenues that we earn on our products
and may have an adverse effect on our business and results of operations.
OUR RESEARCH AND DEVELOPMENT EFFORTS MAY NOT SUCCEED OR OUR COMPETITORS MAY
DEVELOP MORE EFFECTIVE OR SUCCESSFUL PRODUCTS
In order to remain competitive, we must commit substantial resources each
year to research and development. In 1998, we spent approximately $1,200 million
on research and development, compared to $1,217 million in 1997.
The research and development process takes from 10 to 15 years from
discovery to commercial product launch. This process is conducted in various
stages, and during each stage there is a substantial risk that we will not
achieve our goals and will have to abandon a product in which we have invested
substantial amounts. We cannot assure you that we will continue to succeed in
our research and development efforts. If we fail to continue developing
commercially successful products, or if competitors develop more effective
products or a greater number of successful new products, this could have a
material adverse effect on our business and results of operations.
PRODUCT REGULATION MAY ADVERSELY AFFECT OUR ABILITY TO BRING NEW PRODUCTS TO
MARKET
We and our competitors are subject to strict government controls on the
development, manufacture, labeling, distribution and marketing of products. We
must obtain and maintain regulatory approval for a pharmaceutical product from a
country's national regulatory agency before the product may be sold in a
particular country.
The submission of an application to a regulatory authority does not
guarantee that it will grant a license to market the product. Each authority may
impose its own requirements and delay or refuse to grant approval, even though a
product has been approved in another country.
In our principal markets, the approval process for a new product is complex
and lengthy. The time taken to obtain approval
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<PAGE> 7
varies by country but generally takes from six months to four years from the
date of application. This increases the cost to us of developing new products
and increases the risk that we will not succeed in selling them successfully.
PRODUCT LIABILITY CLAIMS COULD ADVERSELY AFFECT OUR BUSINESS AND RESULTS OF
OPERATIONS
Product liability is a significant commercial risk for us. Substantial
damage awards have been made in several jurisdictions against pharmaceutical
companies based upon claims for injuries allegedly caused by the use of their
products.
We are involved in a substantial number of product liability cases claiming
damages as a result of the use of our products. We do not believe that any
potentially unaccrued costs and liabilities associated with these matters will
have a material adverse effect on our consolidated financial position, results
of operations or liquidity. However, we cannot assure you that a future product
liability claim or series of claims brought against us would not have an adverse
effect on our business or results of operations.
OUR BUSINESS EXPOSES US TO RISKS OF ENVIRONMENTAL LIABILITIES
We use hazardous materials, chemicals, viruses and compounds in our product
development programs and manufacturing processes. Although we believe that our
handling and disposing of these materials complies with applicable laws and
regulations, the risk of accidental contamination or injury still exists. If
such an accident occurred, we could be held liable for any damages or fines,
which could have an adverse effect on our business and results of operations.
We have made provision for various environmental liabilities, including
exposures related to several industrial and disposal sites and our closed
chemical plant in North Haven, Connecticut. Our estimates of the total cost we
will incur in connection with environmental situations could change because of
uncertainties at many sites regarding cleanup remedies, the estimated cost of
cleanup and our share of the site's cleanup cost.
We may soon be required to submit a corrective measures study report to the
United States Environmental Protection Agency regarding the closed North Haven
chemical facility. As the corrective action process progresses, we may need to
reevaluate the amount of reserves designated for remediation of the North Haven
site as a result of changing circumstances. It is reasonably possible that we
will be required to make a material increase in accrued liabilities for the
North Haven site, but it is not possible to determine what, if any, additional
exposure exists at this time.
OUR YEAR 2000 PROGRAM MAY NOT SUCCEED, OR OUTSIDE FACTORS COULD CAUSE THE YEAR
2000 PROBLEM TO DISRUPT OUR OPERATIONS
We have established a global Year 2000 program to review our systems and to
develop plans to correct Year 2000 date recognition problems. The program
consists of assessment and remediation of our information technology systems and
embedded systems, assessment of high level business risks and the development of
contingency plans to address these risks. We have completed assessment,
remediation and testing for over 90% of our information technology and embedded
systems and expect to complete this work on our remaining systems in the third
quarter of 1999. During the latter half of 1999, we also plan to conduct
integration testing to ensure that critical systems will work together properly.
We also are working with key external parties whose systems may affect ours, in
order to determine what remediation and contingency actions may be necessary. As
of March 31, 1999, we had spent approximately $115 million of our total
projected costs of $150 million for Year 2000-related compliance actions.
We cannot assure you that our Year 2000 program will succeed. Many factors
outside our control could cause the Year 2000 problem to
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seriously disrupt our operations. The more critical of these risks include:
- a disruption in our supply of products, particularly as a result of
failures of raw material suppliers, third party manufacturers and
external distributors;
- infrastructure failures such as by utilities and communications
providers;
- internal infrastructure failures such as in communications, information
technology services and integrated information technology systems;
- U.S. and non-U.S. government failures, especially as they impact imports
and exports; and
- major customer failures or interruptions.
The scope of our efforts regarding these risks is limited to key products, key
markets, critical supplies and major customers.
We have substantially finalized our contingency plans to address these
risks. Management believes that our Year 2000 program will prevent the Year 2000
problem from having a material adverse effect on our business, financial
position, results of operations and liquidity. However, we cannot assure you
that the Year 2000 problem will not have such an impact on us.
CONVERSION TO THE EURO MAY ADVERSELY AFFECT OUR BUSINESS
On January 1, 1999, several European countries began operating with a new
common currency, the euro. The euro will completely replace these countries'
national currencies by January 1, 2002. The conversion to the euro will require
us to modify some of our systems and certain commercial arrangements. The cost
of this is not expected to be material. The conversion to the euro may have
competitive implications on pricing and marketing strategies, but any such
impact is not known at this time. We expect the conversion to have a limited
impact on our outstanding derivatives and other financial instruments, and a
limited impact on currency risk.
Management believes that the euro conversion will not have a significant
impact on our business; however, it is uncertain what effects the new euro
currency will have on the marketplace. We cannot assure you that all problems
will be foreseen and corrected, or that there will not be a material disruption
of our business.
FOREIGN EXCHANGE FLUCTUATIONS MAY ADVERSELY AFFECT OUR EARNINGS AND THE VALUE OF
OUR NON-U.S. ASSETS
We record our transactions and prepare our financial statements in U.S.
dollars, but a significant portion of our earnings and expenditures are in other
currencies. Changes in exchange rates between the U.S. dollar and these other
currencies can result in increases or decreases in our costs and earnings.
Fluctuations in exchange rates between the U.S. dollar and other currencies may
also affect the book value of our assets outside the United States and the
amount of shareholders' equity. We seek to minimize our currency exposure by
engaging in hedging transactions, where we deem it appropriate.
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<PAGE> 9
SUMMARY CONSOLIDATED FINANCIAL DATA
The summary consolidated financial data set forth below as of December 31,
1998, 1997 and 1996 and for each of the years in the three-year period ended
December 31, 1998 have been derived from, and are qualified by reference to, the
audited consolidated financial statements of Pharmacia & Upjohn, Inc. and its
subsidiaries for such periods, which are incorporated by reference in this
prospectus from our 1998 10-K. The audited consolidated financial statements
have been audited by PricewaterhouseCoopers LLP, independent accountants.
The summary consolidated financial data set forth below as of and for the
three-month periods ended March 31, 1999 and March 31, 1998 have been derived
from, and are qualified by reference to, the unaudited interim consolidated
financial statements of Pharmacia & Upjohn, Inc. and its subsidiaries for such
periods, including information as of and for the three-month period ended March
31, 1999, which has been incorporated by reference in this prospectus from our
Quarterly Report on Form 10-Q for the period ended March 31, 1999. In the
opinion of management, the Interim Consolidated Financial Statements reflect all
adjustments of a normal recurring nature necessary for a fair statement of the
results for the interim periods presented. The results of the three-month period
ended March 31, 1999 are not necessarily indicative of the results that
ultimately may be achieved for the full year. The following data should be read
in conjunction with "Management's Discussion and Analysis of Financial Condition
and Results of Operations", the financial statements, the notes thereto and the
other financial information incorporated by reference in this prospectus.
<TABLE>
<CAPTION>
THREE MONTHS ENDED
AND AT MARCH 31, YEAR ENDED AND AT DECEMBER 31,
------------------ --------------------------------
1999 1998 1998 1997 1996
------- ------- -------- -------- --------
(UNAUDITED)
(IN MILLIONS OF U.S. DOLLARS, EXCEPT PER-SHARE DATA)
<S> <C> <C> <C> <C> <C>
CONSOLIDATED STATEMENTS OF EARNINGS
DATA(1):
Net sales................................. $1,774 $1,586 $6,758 $6,586 $7,176
Cost of products sold..................... 493 486 2,031 2,047 2,116
Research and development.................. 327 277 1,200 1,217 1,266
Selling, general and administrative....... 668 567 2,545 2,635 2,448
Interest income, net...................... (11) (18) (64) (77) (103)
All other, net............................ (19) (3) (62) (20) 148
Restructuring charges..................... -- -- 92 316 518
Gain on sale of subsidiary stock.......... -- -- -- -- (55)
------ ------ ------ ------ ------
Earnings before income taxes.............. 316 277 1,016 468 838
Provision for income taxes................ 95 88 325 145 276
------ ------ ------ ------ ------
Net earnings.............................. $ 221 $ 189 $ 691 $ 323 $ 562
====== ====== ====== ====== ======
Net earnings per common share:
Basic................................... $ 0.43 $ 0.37 $ 1.33 $ 0.61 $ 1.08
====== ====== ====== ====== ======
Diluted................................. $ 0.42 $ 0.36 $ 1.31 $ 0.61 $ 1.07
====== ====== ====== ====== ======
</TABLE>
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<TABLE>
<CAPTION>
THREE MONTHS ENDED
AND AT MARCH 31, YEAR ENDED AND AT DECEMBER 31,
------------------ --------------------------------
1999 1998 1998 1997 1996
------- ------- -------- -------- --------
(UNAUDITED)
(IN MILLIONS OF U.S. DOLLARS, EXCEPT PER-SHARE DATA)
<S> <C> <C> <C> <C> <C>
CONSOLIDATED STATEMENTS OF FINANCIAL
POSITION DATA:
Cash and cash equivalents................. $1,007 $ 821 $ 857 $ 775 $ 641
Short-term investments.................... 268 447 352 539 696
Total assets.............................. 10,131 10,320 10,312 10,380 11,173
Short-term debt(2)........................ 890 657 332 401 235
Long-term debt and guarantee of ESOP
debt(3)................................. 479 602 508 634 823
Total shareholders' equity................ 5,379 5,469 5,600 5,538 6,241
Total liabilities and shareholders'
equity.................................. 10,131 10,320 10,312 10,380 11,173
</TABLE>
- -------------------------
(1) The company is presenting its consolidated statements of earnings in a
single-step format and, accordingly, reclassifications of prior year amounts
have been made to conform to this presentation.
(2) Including current maturities of long-term debt.
(3) See Note 11 to the audited annual consolidated financial statements
incorporated by reference in this prospectus.
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RATIOS OF EARNINGS TO FIXED CHARGES
Our consolidated ratios of earnings to fixed charges and earnings to fixed
charges and preferred stock dividends for the three-month period ended March 31,
1999 and for each of the fiscal years ended December 31, 1994 through 1998 are
as follows:
<TABLE>
<CAPTION>
THREE MONTHS
ENDED YEAR ENDED DECEMBER 31,
MARCH 31, --------------------------------
1999 1998 1997 1996 1995 1994
------------ ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges.............. 12.9 9.3 4.8 6.3 7.0 7.2
Ratio of Earnings to Fixed Charges and Preferred
Stock Dividends............................... 11.2 8.1 4.2 5.7 6.4 6.7
</TABLE>
For purposes of computing these consolidated ratios, earnings consist of
income before:
- income taxes;
- equity in undistributed income of unconsolidated subsidiaries and
affiliates; and
- fixed charges excluding capitalized interest.
Fixed charges consist of:
- all interest expense;
- the portion of net rental expense which is deemed representative of the
interest factor;
- the amortization of debt issuance expense; and
- capitalized interest.
USE OF PROCEEDS
Unless otherwise indicated in the accompanying prospectus supplement, we
will use the net proceeds from the sale of the securities for general corporate
purposes, including the reduction of short-term debt, and to finance future
acquisitions. We may temporarily invest funds that we do not immediately need
for these purposes in short-term marketable securities.
LEGAL OWNERSHIP
"STREET NAME" AND OTHER INDIRECT HOLDERS
Investors who hold securities in accounts at banks or brokers will
generally not be recognized by us as legal holders of securities. When we refer
to the "holders" of securities, we mean only the actual legal holders of the
securities. Holding securities in accounts at banks or brokers is called holding
in "Street Name". If you hold securities in "Street Name", we will recognize
only the bank or broker, or the financial institution the bank or broker uses to
hold its securities. These intermediary banks, brokers and other financial
institutions pass along principal, interest and other payments on the
securities, either because they agree to do so in their customer agreements or
because they are legally required to. If you hold securities in "Street Name,"
you should check with your own institution to find out:
- How it handles securities payments and notices.
- Whether it imposes fees or charges.
- How it would handle voting if ever required.
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- Whether and how you can instruct it to send you securities registered in
your own name so you can be a direct holder as described below.
- How it would pursue rights under the securities if there were a default
or other event triggering the need for holders to act to protect their
interests.
DIRECT HOLDERS
Our obligations, as well as the obligations of the trustee and those of any
third parties employed by us or the trustee, run only to persons who are
registered as holders of securities. As noted above, we do not have obligations
to you if you hold in "Street Name" or other indirect means, either because you
choose to hold securities in that manner or because the securities are issued in
the form of global securities as described below. For example, once we make
payment to the registered holder, we have no further responsibility for the
payment even if that holder is legally required to pass the payment along to you
as a "Street Name" customer but does not do so.
GLOBAL SECURITIES
What is a Global Security? A global security is a special type of
indirectly held security, as described above under " "Street Name" and Other
Indirect Holders" on page 10. If we choose to issue securities in the form of
global securities, the ultimate beneficial owners can only be indirect holders.
We do this by requiring that the global security be registered in the name of a
financial institution we select and by requiring that the securities included in
the global security not be transferred to the name of any other direct holder
unless the special circumstances described below occur. The financial
institution that acts as the sole direct holder of the global security is called
the "depositary". Any person wishing to own a security must do so indirectly by
virtue of an account with a broker, bank or other financial institution that in
turn has an account with the depositary. The prospectus supplement indicates
whether your series of securities will be issued only in the form of global
securities.
Special Investor Considerations for Global Securities. As an indirect
holder, an investor's rights relating to a global security will be governed by
the account rules of the investor's financial institution and of the depositary,
as well as general laws relating to securities transfers. We do not recognize
this type of investor as a holder of securities and instead deal only with the
depositary that holds the global security.
You should be aware that if securities are issued only in the form of
global securities:
- You cannot get securities registered in your own name.
- You cannot receive physical certificates for your interest in the
securities.
- You will be a "Street Name" holder and must look to your own bank or
broker for payments on the securities and protection of your legal rights
relating to the securities. See " "Street Name" and Other Indirect
Holders" on page 10.
- You may not be able to sell interests in the securities to some insurance
companies and other institutions that are required by law to own their
securities in the form of physical certificates.
- The depositary's policies will govern payments, transfers, exchange and
other matters relating to your interest in the global security. We and
the trustee have no responsibility for any aspect of the depositary's
actions or for its records of ownership interests in the global security.
We and the trustee also do not supervise the depositary in any way.
- Payment for purchases and sales in the market for corporate bonds and
notes is generally made in next-day funds. In contrast, the depositary
will usually require that interests in a global security be purchased or
sold within its system using same-day funds. This difference
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could have some effect on how global security interests trade, but we do not
know what that effect will be.
Special Situations When a Global Security Will Be Terminated. In a few
special situations described later, the global security will terminate and
interests in it will be exchanged for physical certificates representing
securities. After that exchange, the choice of whether to hold securities
directly or in "Street Name" will be up to the investor. Investors must consult
their own bank or brokers to find out how to have their interests in securities
transferred to their own name, so that they will be direct holders. The rights
of "Street Name" investors and direct holders in the securities have been
previously described in the subsections entitled " "Street Name" and Other
Indirect Holders" on page 10 and "Direct Holders" on page 11.
The special situations for termination of a global security are:
- When the depositary notifies us that it is unwilling, unable or no longer
qualified to continue as depositary.
- When an Event of Default on the securities has occurred and has not been
cured. Defaults are discussed later under "Events of Default" on page 20.
The prospectus supplement may also list additional situations for terminating a
global security that would apply only to the particular series of securities
covered by the prospectus supplement. When a global security terminates, the
depositary (and not we or the trustee) is responsible for deciding the names of
the institutions that will be the initial direct holders. (Sections 204 and 305)
IN THE REMAINDER OF THIS DESCRIPTION "YOU" MEANS DIRECT HOLDERS AND NOT
"STREET NAME" OR OTHER INDIRECT HOLDERS OF SECURITIES. INDIRECT HOLDERS
SHOULD READ THE PREVIOUS SUBSECTION ON PAGE 10 ENTITLED " "STREET NAME"
AND OTHER INDIRECT HOLDERS".
DESCRIPTION OF DEBT SECURITIES WE MAY OFFER
As required by Federal law for all bonds and notes of companies that are
publicly offered, the debt securities are governed by a document called the
"indenture". The indenture is a contract between us and The Bank of New York,
which acts as trustee. The trustee has two main roles. First, the trustee can
enforce your rights against us if we default. There are some limitations on the
extent to which the trustee acts on your behalf, described later on page 21
under "Remedies If an Event of Default Occurs".
Second, the trustee performs administrative duties for us, such as sending
you interest payments, transferring your debt securities to a new buyer if you
sell and sending you notices.
The indenture and its associated documents contain the full legal text of
the matters described in this section. The indenture and the debt securities are
governed by New York law. A copy of the indenture has been filed with the SEC as
part of our Registration Statement. See "Where You Can Find More Information" on
page 2 for information on how to obtain a copy.
We may issue as many distinct series of debt securities under the indenture
as we wish. This section summarizes all the material terms of the debt
securities that are common to all series unless otherwise indicated in the
prospectus supplement relating to a particular series.
Because this section is a summary, it does not describe every aspect of the
debt securities. This summary is subject to and qualified in its entirety by
reference to all the provisions of the indenture, including definitions of
various terms used in the indenture. For example, in this section we describe
the meaning for only the
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more important terms that have been given special meaning in the indenture. We
also include references in parentheses to applicable sections of the indenture.
Whenever we refer to particular sections or defined terms of the indenture in
this prospectus or in the prospectus supplement, those sections or defined terms
are incorporated by reference here or in the prospectus supplement.
We may issue the debt securities as original issue discount securities,
which will be offered and sold at a substantial discount below their stated
principal amount. (Section 101) A prospectus supplement relating to original
issue discount securities will describe federal income tax consequences and
other special considerations applicable to them. The debt securities may also be
issued as indexed securities or securities denominated in foreign currencies or
currency units, as described in more detail in a prospectus supplement relating
to any of these types of debt securities. A prospectus supplement relating to
indexed debt securities or foreign currency debt securities will also describe
any additional tax consequences or other special considerations applicable to
these types of debt securities.
In addition, the material specific financial, legal and other terms
particular to debt securities of each series are described in the prospectus
supplement relating to the debt securities of that series. The prospectus
supplement relating to debt securities of the series will describe the following
terms of the debt securities:
- the title of the debt securities of the series;
- any limit on the total principal amount of the debt securities of the
series (including any provision for the future offering of additional
debt securities of the series beyond any such limit);
- the date or dates on which the debt securities of the series will mature;
- any annual rate or rates, which may be fixed or variable, at which the
debt securities of the series will bear interest, if any, and the date or
dates from which any interest will accrue;
- the date or dates on which any interest on the debt securities of the
series will be payable and the regular record date or dates we will use
to determine who is entitled to receive each interest payment;
- the place or places where the principal and any premium and interest will
be payable;
- any period or periods within which and the price or prices at which we
will have the option to redeem the debt securities of the series, and the
other detailed terms and provisions of any optional redemption right;
- any obligation we will have to redeem the debt securities of the series
under a sinking fund or analogous provision or to redeem your debt
securities at your option and the period or periods during which, the
price or prices at which and the other specific terms under which we
would be obligated to redeem the debt securities of the series under any
obligation of this kind;
- if other than integral multiples of $1,000, the denominations in which we
will issue the debt securities of the series;
- if other than U.S. dollars, the currency of payment of the principal and
any premium and interest on the debt securities of the series;
- any index or other special method we will use to determine the amount of
principal or any premium or interest we will pay on the debt securities
of the series;
- if we or you have a right to choose the currency or currency units in
which payments on any of the debt securities of the series will be made,
the currencies or
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currency units that we or you may elect, when the election may be made
and the other specific terms of the right to make an election of this
kind;
- if other than the principal amount, the portion of the principal amount
of the debt securities of the series which will be payable upon the
declaration of acceleration of the maturity of the debt securities of the
series;
- the applicability of the provisions described on page 19 under
"Defeasance";
- if we will issue the debt securities of the series only in the form of
global securities as described above under "Global Securities" on page
11, the name of the depository for the debt securities of the series and
the circumstances under which the global securities may be terminated and
separate debt securities may be registered in the names of persons other
than the depositary or its nominee if other than those circumstances
described on page 12 under "Special Situations When a Global Security
will be Terminated"; and
- any other special terms of the debt securities of the series that are not
inconsistent with the provisions of the indenture.
The prospectus supplement relating to the debt securities of the series
will be attached to the front of this prospectus.
We may issue debt securities other than the debt securities described in
this prospectus. There is no requirement that any other debt securities that we
issue be issued under the indenture. Thus, any other debt securities that we
issue may be issued under other indentures or documentation. This documentation
may contain provisions different from those included in the indenture or
applicable to one or more issues of the debt securities described in this
prospectus.
OVERVIEW OF REMAINDER OF THIS DESCRIPTION
The remainder of this description summarizes:
- ADDITIONAL MECHANICS relevant to the debt securities under normal
circumstances, such as how you transfer ownership and where we make
payments;
- your rights under several SPECIAL SITUATIONS, such as if we merge with
another company or, if we want to change a term of the debt securities;
- promises we make to you about how we will run our business, or business
actions we promise not to take (known as "RESTRICTIVE COVENANTS"); and
- your rights if we DEFAULT or experience other financial difficulties.
ADDITIONAL MECHANICS
FORM, EXCHANGE AND TRANSFER
The debt securities will be issued:
- only in fully registered form;
- without interest coupons; and
- in denominations that are even multiples of $1,000 unless otherwise
specified in a prospectus supplement. (Section 302)
You may have your debt securities broken into more debt securities of
smaller denominations or combined into fewer debt securities of larger
denominations, as long as the total principal amount is not changed. (Section
305) This is called an "exchange".
You may exchange or transfer debt securities at the office of the trustee.
The trustee acts as our agent for registering debt securities in the names of
holders and transferring debt securities. We may change this appointment to
another entity or perform it ourselves. The entity performing the role of
maintaining the list of registered holders is called the "security registrar".
The security registrar will also perform transfers. (Section 305)
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You will not be required to pay a service charge to transfer or exchange
debt securities, but you may be required to pay for any tax or other
governmental charge associated with the exchange or transfer. The transfer or
exchange will only be made if the security registrar is satisfied with your
proof of ownership.
If we have designated additional transfer agents, they are named in the
prospectus supplement. We may cancel the designation of any particular transfer
agent. We may also approve a change in the office through which any transfer
agent acts. (Section 1002)
If the debt securities are redeemable and we redeem less than all of the
debt securities of a particular series, we may block the transfer or exchange of
debt securities during the period beginning 15 days before the day we mail the
notice of redemption and ending on the day of that mailing, in order to freeze
the list of holders to prepare the mailing. We may also refuse to register
transfers or exchanges of debt securities selected for redemption, except that
we will continue to permit transfers and exchanges of the unredeemed portion of
any security being partially redeemed. (Section 305)
PAYMENT AND PAYING AGENTS
We will pay interest to you if you are a direct holder listed in the
trustee's records at the close of business on a particular day in advance of
each due date for interest, even if you no longer own the security on the
interest due date. That particular day, usually about two weeks in advance of
the interest due date, is called the "regular record date" and is stated in the
prospectus supplement. (Section 307) Holders buying and selling debt securities
must work out between them how to compensate for the fact that we will pay all
the interest for an interest period to the one who is the registered holder on
the regular record date. The most common manner is to adjust the sale price of
the debt securities to allocate interest fairly between buyer and seller. This
allocated interest amount is called "accrued interest".
We will pay interest, principal and any other money due on the debt
securities at the corporate trust office of the trustee in New York City. That
office is currently located at 101 Barclay Street, New York, New York 10286. You
must make arrangements to have your payments picked up at or wired from that
office. We may also choose to pay interest by mailing checks.
"STREET NAME" AND OTHER INDIRECT HOLDERS SHOULD CONSULT THEIR BANKS OR BROKERS
FOR INFORMATION ON HOW THEY WILL RECEIVE PAYMENTS.
We may also arrange for additional payment offices, and may cancel or
change these offices, including our use of the trustee's corporate trust office.
These offices are called "paying agents". We may also choose to act as our own
paying agent. We must notify you of changes in the paying agents for any
particular series of debt securities. (Section 1002)
NOTICES
We and the trustee will send notices regarding the debt securities only to
direct holders, using their addresses as listed in the trustee's records.
(Sections 101 and 106)
Regardless of who acts as paying agent, all money paid by us to a paying
agent that remains unclaimed at the end of two years after the amount is due to
direct holders will be repaid to us. After that two-year period, you may look
only to us for payment and not to the trustee, any other paying agent or anyone
else. (Section 1003)
SPECIAL SITUATIONS
MERGERS AND SIMILAR EVENTS
We are generally permitted to consolidate or merge with another company or
firm. We are also permitted to sell substantially all of our assets to another
firm, or to buy substantially all of the assets of another firm. However, we may
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not take any of these actions unless all the following conditions are met:
- Where we merge out of existence or sell our assets, the other company or
firm must agree to be legally responsible for the debt securities.
- The merger, sale of assets or other transaction must not cause a default
on the debt securities, and we must not already be in default (unless the
merger or other transaction would cure the default). For purposes of this
no-default test, a default would include an event of default that has
occurred and not been cured, as described later on page 20 under "What Is
An Event of Default?" A default for this purpose would also include any
event that would be an event of default if the requirements for giving us
default notice or our default having to exist for a specific period of
time were disregarded.
- It is possible that the merger, sale of assets or other transaction would
cause some of our property to become subject to a mortgage or other legal
mechanism giving lenders preferential rights in that property over other
lenders or over our general creditors if we fail to pay them back. We
have promised to limit these preferential rights on our property, called
"liens", as discussed later on page 17 under "Restrictive
Covenants -- Restrictions on Liens". If a merger or other transaction
would create any liens on our property, we must comply with that
restrictive covenant. We would do this either by deciding that the liens
were permitted, or by following the requirements of the restrictive
covenant to grant an equivalent or higher-ranking lien on the same
property to you and the other direct holders of the debt securities.
- We must deliver certain certificates and other documents to the trustee.
- We must satisfy any other requirements specified in the prospectus
supplement. (Section 801)
MODIFICATION AND WAIVER
There are three types of changes we can make to the indenture and the debt
securities.
Changes Requiring Your Approval. First, there are changes that cannot be
made to your debt securities without your specific approval. Following is a list
of those types of changes:
- change the stated maturity of the principal or interest on a debt
security;
- reduce any amounts due on a debt security;
- reduce the amount of principal payable upon acceleration of the maturity
of a debt security following a default;
- change the place or currency of payment on a debt security;
- impair your right to sue for payment;
- reduce the percentage of holders of debt securities whose consent is
needed to modify or amend the indenture;
- reduce the percentage of holders of debt securities whose consent is
needed to waive compliance with certain provisions of the indenture or to
waive certain defaults; and
- modify any other aspect of the provisions dealing with modification and
waiver of the indenture. (Section 902)
Changes Requiring a Majority Vote. The second type of change to the
indenture and the debt securities is the kind that requires a vote in favor by
holders of debt securities owning a majority of the principal amount of the
particular series affected. Most changes fall into this category, except for
clarifying changes and certain other changes that would not adversely affect
holders of the debt securities. The same vote would be required for us to obtain
a waiver of all or part of the restrictive covenants described under
"Restrictive Covenants" on
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page 17, or a waiver of a past default. However, we cannot obtain a waiver of a
payment default or any other aspect of the indenture or the debt securities
listed in the first category described previously on page 16 under "Changes
Requiring Your Approval" unless we obtain your individual consent to the waiver.
(Section 513)
Changes Not Requiring Approval. The third type of change does not require
any vote by holders of debt securities. This type is limited to clarifications
and certain other changes that would not adversely affect holders of the debt
securities in any material way.
Further Details Concerning Voting. When taking a vote, we will use the
following rules to decide how much principal amount to attribute to a security:
- For original issue discount securities, we will use the principal amount
that would be due and payable on the voting date if the maturity of the
debt securities were accelerated to that date because of a default.
- For debt securities whose principal amount is not known (for example,
because it is based on an index), we will use a special rule for that
security described in the prospectus supplement.
- For debt securities denominated in one or more foreign currencies or
currency units, we will use the U.S. dollar equivalent.
Debt securities will not be considered outstanding, and therefore not
eligible to vote, if we have deposited or set aside in trust for you money for
their payment or redemption. Debt securities will also not be eligible to vote
if they have been fully defeased as described later on page 19 under "Full
Defeasance". (Section 101)
We will generally be entitled to set any day as a record date for the
purpose of determining the holders of outstanding debt securities that are
entitled to vote or take other action under the indenture. In certain limited
circumstances, the trustee will be entitled to set a record date for action by
holders. If we or the trustee set a record date for a vote or other action to be
taken by holders of a particular series, that vote or action may be taken only
by persons who are holders of outstanding debt securities of that series on the
record date and must be taken within 180 days following the record date or a
shorter period that we may specify (or as the trustee may specify, if it set the
record date). We may shorten or lengthen (but not beyond 180 days) this period
from time to time. (Section 104)
"STREET NAME" AND OTHER INDIRECT HOLDERS SHOULD CONSULT THEIR BANKS OR
BROKERS FOR INFORMATION ON HOW APPROVAL MAY BE GRANTED OR DENIED IF WE
SEEK TO CHANGE THE INDENTURE OR THE DEBT SECURITIES OR REQUEST A WAIVER.
RESTRICTIVE COVENANTS
Restrictions on Liens. Some of our property may be subject to a mortgage
or other legal mechanism that gives our lenders preferential rights in that
property over other lenders (including you and the other direct holders of the
debt securities) or over our general creditors if we fail to pay them back.
These preferential rights are called "liens". We promise that we will not become
obligated on any new debt that is secured by a lien on any of our principal
manufacturing properties, or on any shares of stock or debt of any of our
principal subsidiaries, unless we grant an equivalent or higher-ranking lien on
the same property to you and the other direct holders of the debt securities.
We do not need to comply with this restriction if the amount of all debt
that would be secured by liens on principal manufacturing properties (including
the new debt, the debt securities which we would so secure as described in the
previous sentence, and all "attributable debt", as described under "Restriction
on Sales and Leasebacks" below, that results from a sale and leaseback transac-
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tion involving principal manufacturing properties) is less than 10% of our
consolidated net tangible assets.
This restriction on liens does not apply to debt secured by certain types
of liens, and we can disregard this debt when we calculate the limits imposed by
this restriction. These types of liens include:
- liens on the property of any of our principal subsidiaries, or on their
shares of stock or debt, if those liens existed at the time the
corporation became our principal subsidiary;
- liens in favor of us or our principal subsidiaries;
- liens in favor of U.S. Governmental bodies that we granted in order to
assure our payments to such bodies that we owe by law or because of a
contract we entered into;
- liens on property that existed at the time we acquired the property
(including property we may acquire through a merger or similar
transaction) or that we granted in order to purchase the property
(sometimes called "purchase money mortgages"); and
- liens on the buildings or property that will comprise the Company's new
headquarters facility in Peapack, New Jersey.
We can also disregard debt secured by liens that extend, renew or replace
any of these types of liens.
We and our subsidiaries are permitted to have as much unsecured debt as we
may choose.
Restrictions on Sales and Leasebacks. We promise that neither we nor any
of our principal subsidiaries will enter into any sale and leaseback transaction
involving a principal manufacturing property, unless we comply with this
restrictive covenant. A "sale and leaseback transaction" generally is an
arrangement between us or a principal subsidiary and a bank, insurance company
or other lender or investor where we or the principal subsidiary lease a
property which was or will be sold by us or the principal subsidiary to that
lender or investor more than 120 days after the completion of construction of
the property and the beginning of its full operation.
We can comply with this restrictive covenant in either of two different
ways. First, we will be in compliance if we or our principal subsidiary could
grant a lien on the principal manufacturing property in an amount equal to the
attributable debt for the sale and leaseback transaction without being required
to grant an equivalent or higher-ranking lien to you and the other direct
holders of the debt securities under the restrictions on liens covenant
described above on page 17. Second, we can comply if we retire an amount of
funded debt, within 120 days of the transaction, equal to at least the net
proceeds of the sale of the principal manufacturing property that we lease in
the transaction or the fair value of that property (subject to credits for
certain voluntary retirements of debt securities and funded debt we may make),
whichever is greater.
This restriction on sale and leasebacks does not apply to any sale and
leaseback transaction that is between us and one of our principal subsidiaries
or between principal subsidiaries, or that involves a lease for a period of
three years or less.
Certain Definitions Relating to our Restrictive Covenants. Following are
the meanings of the terms that are important in understanding the restrictive
covenants previously described.
"attributable debt" means, in connection with any sale or leaseback
transaction, the lesser of (i) the fair value of the property subject to the
sale and leaseback transaction (as determined by our board of directors) and
(ii) the total net amount of rent (discounted at a rate per annum equal to a
composite rate of interest on all outstanding debt securities) that is required
to be paid during the remaining term of the lease on this property.
"consolidated net tangible assets" is the total amount of assets (less
reserves and certain
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other permitted deductible items), after
subtracting all current liabilities and all goodwill, trade names, trademarks,
patents, unamortized debt discounts and expenses and similar intangible assets,
as such amounts appear on our most recent consolidated balance sheet and
computed in accordance with generally accepted accounting principles.
"funded debt" means all debt for borrowed money that either has a maturity
of 12 months or more from the date on which the calculation of funded debt is
made or has a maturity of less than 12 months from that date but is by its terms
renewable or extendible beyond 12 months from that date at the option of the
borrower.
A "principal manufacturing property" is any building or other structure or
facility, and the land on which it sits and its associated fixtures, that we or
our principal subsidiaries use primarily for manufacturing or processing, other
than a building, structure or other facility that our board of directors has
determined is not of material importance to the total business that we and our
principal subsidiaries conduct.
A "principal subsidiary" means any of Pharmacia & Upjohn Company, Pharmacia
& Upjohn AB, Pharmacia S.p.A. and Pharmacia & Upjohn Caribe Inc.
DEFEASANCE
The following discussion of full defeasance and covenant defeasance will be
applicable to your series of debt securities only if we choose to have them
apply to that series. If we do so choose, we will state that in the prospectus
supplement. (Section 1301)
Full Defeasance. If there is a change in federal tax law, as described
below, we can legally release ourselves from any payment or other obligations on
the debt securities (called "full defeasance") if we put in place the following
other arrangements for you to be repaid:
- We must deposit in trust for your benefit and the benefit of all other
direct holders of the debt securities a combination of money and U.S.
government or U.S. government agency notes or bonds that will generate
enough cash to make interest, principal and any other payments on the
debt securities on their various due dates.
- There must be a change in current federal tax law or an IRS ruling that
lets us make the above deposit without causing you to be taxed on the
debt securities any differently than if we did not make the deposit and
just repaid the debt securities ourselves. (Under current federal tax
law, the deposit and our legal release from the debt securities would be
treated as though we took back your debt securities and gave you your
share of the cash and notes or bonds deposited in trust. In that event,
you could recognize gain or loss on the debt securities you give back to
us.)
- We must deliver to the trustee a legal opinion of our counsel confirming
the tax law change described above. (Sections 1302 and 1304)
If we ever did accomplish full defeasance, as described above, you would
have to rely solely on the trust deposit for repayment on the debt securities.
You could not look to us for repayment in the unlikely event of any shortfall.
Conversely, the trust deposit would most likely be protected from claims of our
lenders and other creditors if we ever become bankrupt or insolvent.
Covenant Defeasance. Under current federal tax law, we can make the same
type of deposit described above and be released from some of the restrictive
covenants in the debt securities. This is called "covenant defeasance". In that
event, you would lose the protection of those restrictive covenants but would
gain the protection of having money and securities set aside in trust to repay
the debt securities. In
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order to achieve covenant defeasance, we must
do the following:
- We must deposit in trust for your benefit and the benefit of all other
direct holders of the debt securities a combination of money and U.S.
government or U.S. government agency notes or bonds that will generate
enough cash to make interest, principal and any other payments on the
debt securities on their various due dates.
- We must deliver to the trustee a legal opinion of our counsel confirming
that under current federal income tax law we may make the above deposit
without causing you to be taxed on the debt securities any differently
than if we did not make the deposit and just repaid the debt securities
ourselves.
If we accomplish covenant defeasance, the following provisions of the
indenture and the debt securities would no longer apply:
- Our promises regarding conduct of our business previously described under
"Restrictive Covenants" on page 17, and any other covenants applicable to
the series of debt securities and described in the prospectus supplement.
- The condition regarding the treatment of liens when we merge or engage in
similar transactions, as previously described on page 15 under "Mergers
and Similar Events".
- The events of default relating to breach of covenants and acceleration of
the maturity of other debt, described later under "What Is An Event of
Default?".
If we accomplish covenant defeasance, you can still look to us for
repayment of the debt securities if there were a shortfall in the trust deposit.
In fact, if one of the remaining events of default occurred (such as our
bankruptcy) and the debt securities become immediately due and payable, there
may be such a shortfall. Depending on the event causing the default, you may not
be able to obtain payment of the shortfall. (Sections 1303 and 1304)
DEFAULT AND RELATED MATTERS
RANKING
The debt securities are not secured by any of our property or assets.
Accordingly, your ownership of debt securities means you are one of our
unsecured creditors. The debt securities are not subordinated to any of our
other debt obligations and therefore they rank equally with all our other
unsecured and unsubordinated indebtedness.
EVENTS OF DEFAULT
You will have special rights if an event of default occurs and is not
cured, as described later in this subsection.
What Is An Event of Default? The term "event of default" means any of the
following:
- We do not pay the principal or any premium on a debt security on its due
date.
- We do not pay interest on a debt security within 30 days of its due date.
- We do not deposit any sinking fund payment on its due date.
- We remain in breach of a restrictive covenant described beginning on page
17 or any other term of the indenture for 60 days after we receive a
notice of default stating we are in breach. The notice must be sent by
either the trustee or holders of 10% of the principal amount of debt
securities of the affected series.
- We file for bankruptcy or certain other events in bankruptcy, insolvency
or reorganization occur.
- Any other event of default described in the prospectus supplement occurs.
(Section 501)
20
<PAGE> 22
An event of default for a particular series of debt securities does not
necessarily constitute an event of default for any other series of debt
securities issued under the indenture.
Remedies If an Event of Default Occurs. If an event of default has occurred
and has not been cured, the trustee or the holders of 25% in principal amount of
the debt securities of the affected series may declare the entire principal
amount of all the debt securities of that series to be due and immediately
payable. This is called a declaration of acceleration of maturity. If an event
of default occurs because of certain events in bankruptcy, insolvency or
reorganization, the principal amount of all the debt securities of that series
will be automatically accelerated, without any action by the trustee or any
holder. A declaration of acceleration of maturity may be canceled by the holders
of at least a majority in principal amount of the debt securities of the
affected series. (Section 502)
Except in cases of default, where the trustee has some special duties, the
trustee is not required to take any action under the indenture at the request of
any holders unless the holders offer the trustee satisfactory protection from
expenses and liability. This protection is called an "indemnity". (Section 603)
If satisfactory indemnity is provided, the holders of a majority in principal
amount of the outstanding debt securities of the relevant series may direct the
time, method and place of conducting any lawsuit or other formal legal action
seeking any remedy available to the trustee. These majority holders may also
direct the trustee in performing any other action under the indenture. (Section
512)
Before you bypass the trustee and bring your own lawsuit or other formal
legal action or take other steps to enforce your rights or protect your
interests relating to the debt securities, the following must occur:
- You must give the trustee written notice that an event of default has
occurred and remains uncured.
- The holders of 25% in principal amount of all outstanding debt securities
of the relevant series must make a written request that the trustee take
action because of the default, and must offer reasonable indemnity to the
trustee against the cost and other liabilities of taking that action.
- The trustee must have not taken action for 60 days after receipt of the
above notice and offer of indemnity.
- The holders of a majority in principal amount of all outstanding debt
securities of the relevant series must not have given the trustee a
direction that is inconsistent with the above notice. (Section 507)
However, you are entitled at any time to bring a lawsuit for the payment of
money due on your debt security on or after its due date. (Section 508)
"STREET NAME" AND OTHER INDIRECT HOLDERS SHOULD CONSULT THEIR BANKS OR
BROKERS FOR INFORMATION ON HOW TO GIVE NOTICE OR DIRECTION TO OR MAKE A
REQUEST OF THE TRUSTEE AND TO MAKE OR CANCEL A DECLARATION OF
ACCELERATION.
We will furnish to the trustee every year a written statement of certain of
our officers certifying that to their knowledge we are in compliance with the
indenture and the debt securities, or else specifying any default. (Section
1004)
REGARDING THE TRUSTEE
The Bank of New York currently acts as trustee under the indenture for our
$200 million 5.875% Notes due April 15, 2000, and as trustee under the indenture
for the $275 million 9.79% Amortizing Notes due February 1, 2004 issued by the
Employee Stock Ownership Trust of The Upjohn Company. We have guaranteed the
trust's obligations under those notes.
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<PAGE> 23
DESCRIPTION OF DEBT WARRANTS WE MAY OFFER
We may issue warrants for the purchase of debt securities. Debt warrants
may be issued separately or together with debt securities.
The debt warrants are to be issued under debt warrant agreements to be
entered into between Pharmacia & Upjohn, Inc. and one or more banks or trust
companies, as debt warrant agent, all as will be set forth in the prospectus
supplement relating to the debt warrants being offered by the prospectus
supplement. A form of debt warrant agreement, including a form of debt warrant
certificate representing the debt warrants, reflecting the alternative
provisions that may be included in the debt warrant agreements to be entered
into with respect to particular offerings of debt warrants, is included as an
exhibit to the registration statement. See "Where You Can Find More Information"
on page 2 for information on how to obtain a copy of the form of debt warrant
agreement.
The following description of the debt warrant agreements and the debt
warrant certificates and summaries of some provisions of the debt warrant
agreements and the debt warrant certificates do not describe every aspect of the
debt warrants and are subject to, and are qualified in their entirety by
reference to, all the provisions of the applicable debt warrant agreements and
the debt warrant certificates, including definitions of terms used in the debt
warrant agreements and not otherwise defined in this prospectus. For example, in
this section we use some terms that have been given special meaning in the debt
warrant agreements. We also include references in parentheses to some sections
of the debt warrant agreements. Whenever we refer to particular sections or
defined terms of the debt warrant agreement in this prospectus, those sections
or defined terms are incorporated by reference here or in the relevant
prospectus supplement.
TERMS OF THE DEBT WARRANTS TO BE
DESCRIBED IN THE PROSPECTUS SUPPLEMENT
The particular terms of each issue of debt warrants, the debt warrant
agreement relating to the debt warrants and the debt warrant certificates
representing debt warrants will be described in the applicable prospectus
supplement. This description will include:
- the initial offering price;
- the currency or currency unit in which the price for the debt warrants is
payable;
- the title, aggregate principal amount and terms of the debt securities
purchasable upon exercise of the debt warrants;
- the title and terms of any related debt securities with which the debt
warrants are issued and the number of the debt warrants issued with each
debt security;
- the date, if any, on and after which the debt warrants and the related
debt securities will be separately transferable;
- the principal amount of debt securities purchasable upon exercise of each
debt warrant and the price at which that principal amount of debt
securities may be purchased upon exercise of each debt warrant;
- the date on which the right to exercise the debt warrants will commence
and the date on which this right will expire;
- the identity of the debt warrant agent;
- if applicable, a discussion of United States federal income tax,
accounting or other considerations applicable to debt warrants; and
- any other terms of the debt warrants.
Debt warrant certificates will be exchangeable for new debt warrant
certificates of different denominations and, if in registered form, may be
presented for registration of transfer, and debt warrants may be exercised, at
the corporate trust office of the debt warrant agent or any other office
indicated in the related prospectus supplement. (Section 3.01) Before the
exercise of debt warrants, holders of debt
22
<PAGE> 24
warrants will not be entitled to payments of principal, premium, if any, or
interest, if any, on the debt securities purchasable upon exercise of the debt
warrants, or to enforce any of the covenants in the indenture. (Section 4.01)
EXERCISE OF DEBT WARRANTS
Unless otherwise provided in the related prospectus supplement, each debt
warrant will entitle the holder of debt warrants to purchase for cash the
principal amount of debt securities at the exercise price that will in each case
be set forth in, or be determinable as set forth in, the related prospectus
supplement. (Sections 2.01 and 2.03) Debt warrants may be exercised at any time
up to the close of business on the expiration date specified in the prospectus
supplement relating to the debt warrants. After the close of business on the
expiration date or any later date to which the expiration date may be extended
by Pharmacia & Upjohn, Inc., unexercised debt warrants will become void.
(Section 2.02)
Debt warrants may be exercised as set forth in the prospectus supplement
relating to the debt warrants. Upon receipt of payment and the debt warrant
certificate properly completed and duly executed at the corporate trust office
of the debt warrant agent or any other office indicated in the prospectus
supplement, we will, as soon as practicable, forward the debt securities
purchasable upon exercise of the debt warrants to the person entitled to them.
If fewer than all of the debt warrants represented by the debt warrant
certificate are exercised, a new debt warrant certificate will be issued for the
remaining amount of debt warrants. (Section 2.03)
If you hold your interest in a debt warrant indirectly, you should check
with the institution through which you hold your interest in the debt warrant to
determine how these provisions will apply to you. See "Legal Ownership" on page
10 for a general description of the procedures and rights applicable to indirect
owners of debt warrants.
MODIFICATIONS
The debt warrant agreement may be amended by Pharmacia & Upjohn, Inc. and
the debt warrant agent, without the consent of the holder of any debt warrant
certificate, for the purpose of curing any ambiguity, or of curing, correcting
or supplementing any defective provision contained in the debt warrant
agreement, or making any provisions in regard to matters or questions arising
under the debt warrant agreement that we may deem necessary or desirable;
provided that the amendment may not adversely affect the interest of the holders
of debt warrant certificates in any material respect. (Section 6.03) We and the
debt warrant agent also may modify or amend the debt warrant agreement and the
terms of the debt warrants, with the consent of the owners of not less than a
majority in number of the then outstanding unexercised debt warrants affected.
However, any modification or amendment that increases the exercise price,
shortens the period of time during which the debt warrants may be exercised or
otherwise materially and adversely affects the exercise rights of the owners of
debt warrants or reduces the number of debt warrants the consent of whose owners
is required for modification or amendment of the debt warrant agreement or the
terms of the debt warrants may be made only with the consent of the owners
affected by the modification or amendment.
MERGER, CONSOLIDATION, SALE OR OTHER DISPOSITIONS
Under the debt warrant agreement, we may, to the extent permitted in the
indenture, consolidate with, or sell or convey all or substantially all of our
assets to, or merge with or into, any other corporation. If at any time there is
a merger, consolidation, sale, transfer, conveyance or other disposition of
substantially all of the assets of Pharmacia & Upjohn, Inc., the successor or
assuming corporation will succeed to and be substituted for Pharmacia & Upjohn,
Inc., with the same effect as if it had been named in the debt warrant agreement
and in the debt warrants as Pharmacia & Upjohn, Inc. We will then be relieved of
any further
23
<PAGE> 25
obligation under the debt warrant agreement or under the debt warrants.
(Sections 6.01 and 6.02)
ENFORCEABILITY OF RIGHTS; GOVERNING LAW
The debt warrant agent will act solely as an agent of Pharmacia & Upjohn,
Inc. in connection with the issuance and exercise of debt warrants and will not
assume any obligation or relationship of agency or trust for or with any holder
of a debt warrant certificate or any owner of a beneficial interest in debt
warrants. (Section 5.02) The holders of debt warrant certificates, without the
consent of the debt warrant agent, the trustee, the holder of any debt
securities issued upon exercise of debt warrants or the holder of any other debt
warrant certificates, may, on their own behalf and for their own benefit,
enforce, and may institute and maintain any suit, action or proceeding against
Pharmacia & Upjohn, Inc. suitable to enforce, or otherwise in respect of, their
rights to exercise debt warrants evidenced by their debt warrant certificates.
(Section 4.02) Except as may otherwise be provided in the related prospectus
supplement, each issue of debt warrants and the applicable debt warrant
agreement will be governed by and construed in accordance with the law of the
State of New York. (Section 6.07)
DESCRIPTION OF PREFERRED STOCK WE MAY OFFER
Each series of preferred stock will have specific financial and other terms
which will be described in a prospectus supplement. The description of the
preferred stock that is set forth in any prospectus supplement is not complete
without reference to the documents that govern the preferred stock. These
include the Amended and Restated Certificate of Incorporation of Pharmacia &
Upjohn, Inc. and the Certificate of Designation and Terms of Participating
Preferred Stock of Pharmacia & Upjohn, Inc.
Our Amended and Restated Certificate of Incorporation authorizes the Board
of Directors to issue up to 100,000,000 shares of preferred stock, par value
$0.01 per share, in one or more series. As of June 30, 1999, we had designated
and issued 6,791 shares of Convertible Series A Perpetual Preferred Stock. The
number of authorized shares of preferred stock may be increased or decreased by
the affirmative vote of the holders of a majority of the outstanding stock of
Pharmacia & Upjohn, Inc. without the separate vote of holders of preferred stock
as a class.
Our Board of Directors is authorized to designate, for each series of
preferred stock:
- the maximum number of shares in the series;
- the designation of the series;
- the dividend rate, or basis for determining such rate, if any, on the
shares of the series;
- whether dividends will be cumulative and, if so, from which date or
dates;
- whether the shares of the series will be redeemable and, if so, the
dates, prices and other terms and conditions of redemption;
- whether we will be obligated to purchase or redeem shares of the series
pursuant to a sinking fund or otherwise, and the prices, periods and
other terms and conditions upon which the shares of the series will be
redeemed or purchased;
- whether the shares of the series will be convertible into, or
exchangeable for, shares of stock of any other class or classes and, if
so, the rate or rates of conversion or exchange, the terms of adjustment,
if any, and whether the shares of the series will be convertible or
exchangeable at our option or the option of holders of preferred shares,
or both;
- whether the shares of the series will have voting rights, in addition to
the voting
24
<PAGE> 26
rights provided by law, and, if so, the terms of those voting rights;
- the rights of the shares of the series in the event of the voluntary or
involuntary liquidation, dissolution or winding up of Pharmacia & Upjohn,
Inc.; and
- any other relative rights, powers, preferences, qualifications,
limitations or restrictions relating to the shares of the series.
The shares of preferred stock of any one series will be identical with each
other except for the dates from which dividends will cumulate, if at all. The
shares of preferred stock will be fully paid and nonassessable.
PLAN OF DISTRIBUTION
We may sell the securities offered by this prospectus through agents,
underwriters or dealers, directly or indirectly to one or more purchasers.
The accompanying prospectus supplement will identify or describe:
- any underwriters, dealers or agents;
- their compensation;
- the net proceeds to Pharmacia & Upjohn, Inc.;
- the purchase price of the securities;
- the initial public offering price of the securities; and
- any exchange on which the securities are listed.
Agents. We may designate agents who agree to use their reasonable efforts
to solicit purchases for the period of their appointment to sell securities on a
continuing basis.
Underwriters. If we use underwriters for a sale of securities, the
underwriters will acquire the securities for their own account. The underwriters
may resell the securities in one or more transactions, including negotiated
transactions, at a fixed public offering price or at varying prices determined
at the time of sale. Any initial public offering price and any discounts or
concessions allowed or re-allowed or paid to dealers may be changed from time to
time.
Direct Sales. We may also sell securities directly to one or more
purchasers without using underwriters or agents.
Underwriters, dealers, and agents that participate in the distribution of
the securities may be underwriters as defined in the Securities Act of 1933, and
any discounts or commissions they receive from us and any profit on their resale
of the debt securities may be treated as underwriting discounts and commissions
under the Securities Act. We may have agreements with the underwriters, dealers
and agents to indemnify them against certain civil liabilities, including
liabilities under the Securities Act. Underwriters, dealers and agents may
engage in transactions with or perform services for us in the ordinary course of
their businesses.
VALIDITY
The validity of the securities offered by this prospectus will be passed
upon for Pharmacia & Upjohn, Inc. by Sullivan & Cromwell, New York, New York,
and for any underwriters or agents by Shearman & Sterling, New York, New York,
or other counsel named in the prospectus supplement.
25
<PAGE> 27
INDEPENDENT ACCOUNTANTS
The consolidated balance sheets of Pharmacia & Upjohn, Inc. as of December
31, 1998 and 1997, and the consolidated statements of earnings, shareholders'
equity and cash flows for each of the three years in the period ended December
31, 1998, which have been incorporated by reference in this prospectus, have
been included and incorporated by reference herein in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
that firm as experts in auditing and accounting. With respect to the unaudited
consolidated interim financial information for the three-month periods ended
March 31, 1999 and 1998, incorporated by reference in this prospectus, the
independent accountants have reported that they have applied limited procedures
in accordance with professional standards for a review of such information.
However, their separate review report included in our quarterly report on Form
10-Q for the quarter ended March 31, 1999 and incorporated by reference herein,
states that they did not audit and they do not express an opinion on that
unaudited interim financial information. Accordingly, the degree of reliance on
their review report on such information should be restricted in light of the
limited nature of the review procedures applied. The accountants are not subject
to the liability provisions of Section 11 of the Securities Act of 1933 for
their report on the unaudited interim financial information because that report
is not a "report" or a "part" of the registration statement prepared or
certified by the accountants within the meaning of Sections 7 and 11 of the
Securities Act.
26
<PAGE> 28
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
Set forth below is an estimate of the fees and expenses payable by
Pharmacia & Upjohn, Inc. in connection with the securities being registered
hereby:
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee......... $278,000
Legal fees and expenses..................................... 250,000
Accountants' fees and expenses.............................. 30,000
Blue sky fees and expenses.................................. 8,000
Indenture trustees' fees and expenses....................... 9,000
Printing.................................................... 15,000
--------
Total.................................................. $590,000
========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law authorizes a court to
award, or a corporation's board of directors to grant, indemnity to directors
and officers in terms sufficiently broad to permit such indemnification under
certain circumstances for liabilities (including reimbursement for expenses
incurred) arising under the Securities Act of 1933. The Registrant's Certificate
of Incorporation and By-laws provide for indemnification of its directors,
officers, employees and other agents to the maximum extent permitted by the
Delaware General Corporation Law. In addition, the Registrant has entered into
Indemnification Agreements with its executive officers and directors. The
Registrant has also purchased and maintains insurance for its officers,
directors, employees or agents against liabilities which an officer, a director,
an employee or an agent may incur in his capacity as such.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Exhibits.
<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION
- ------- -----------
<C> <S> <C>
1.1 -- Form of Underwriting Agreement for the Securities.
4.1 -- Restated Certificate of Incorporation of Pharmacia & Upjohn
(incorporated by reference to Exhibits 4.1 and 4.2 to
Pharmacia & Upjohn's Registration Statement on Form S-8
filed May 3, 1996).
4.2 -- Restated By-Laws of Pharmacia & Upjohn (incorporated by
reference to Exhibit 3.2 to Pharmacia & Upjohn's Annual
Report on Form 10-K for the year ended December 31, 1998,
filed March 30, 1999).
4.3 -- Form of Indenture
4.4 -- Form of Debt Securities (included in Exhibit 4.3).
4.5 -- Form of Debt Warrant Agreement between Pharmacia & Upjohn,
Inc. and the Debt Warrant Agent, including a form of Debt
Warrant Certificate.
5 -- Opinion of Sullivan & Cromwell.
</TABLE>
II-1
<PAGE> 29
<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION
- ------- -----------
<C> <S> <C>
12.1 -- Computation of Earnings to Fixed Charges and Earnings to
Fixed Charges and Preferred Stock Dividends.
15 -- Awareness Letter from PricewaterhouseCoopers LLP, concerning
unaudited interim financial information.
23(a) -- Consent of PricewaterhouseCoopers LLP.
23(b) -- Consent of Sullivan & Cromwell (included in Exhibit 5).
24.1 -- Powers of Attorney (included in signature page).
25.1 -- Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939, as amended, of The Bank of New York.
</TABLE>
(b) Financial Statement Schedules.
Schedules are omitted because they are either not required, are not
applicable or because equivalent information has been included in the financial
statements, the notes thereto or elsewhere herein.
(c) Reports, Opinions and Appraisals.
Not applicable.
ITEM 17. UNDERTAKINGS
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933 (the "Securities Act");
(ii) To reflect in the prospectus any fact or events arising after
the effective date of this 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 this Registration Statement; and
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in this Registration Statement
or any material change to such information in this 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 Registrant
pursuant to Section 13 or Section 15(d) of the Securities Act of 1934 (the
"Exchange Act") that are incorporated in this Registration Statement;
(2) That, for purposes of determining any liability under the
Securities Act, 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;
II-2
<PAGE> 30
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liability arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
II-3
<PAGE> 31
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 BRIDGEWATER, NEW JERSEY, ON THIS 13TH DAY OF JULY, 1999.
PHARMACIA & UPJOHN, INC.
By /s/ FRED HASSAN
------------------------------------
Fred Hassan
President and Chief Executive
Officer
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATES INDICATED.
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE APPEARS
BELOW CONSTITUTES AND APPOINTS FRED HASSAN, CHRISTOPHER COUGHLIN, AND RICHARD
COLLIER, AND EACH OF THEM INDIVIDUALLY, HIS TRUE AND LAWFUL ATTORNEYS-IN-FACT
AND AGENTS, WITH FULL POWER AND IN ANY AND ALL CAPACITIES, TO SIGN THIS
REGISTRATION STATEMENT AND ANY AND ALL AMENDMENTS (INCLUDING POST-EFFECTIVE
AMENDMENTS) TO THIS REGISTRATION STATEMENT, AND TO FILE SUCH REGISTRATION
STATEMENT AND ALL SUCH AMENDMENTS OR SUPPLEMENTS, 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, AS FULLY TO ALL
INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN PERSON, THEREBY RATIFYING AND
CONFIRMING ALL THAT SAID ATTORNEYS-IN-FACT AND AGENTS OR ANY OF THEM, OR THEIR
OR HIS SUBSTITUTES OR SUBSTITUTE, MAY LAWFULLY DO OR CAUSE TO BE DONE BY VIRTUE
THEREOF.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- --------- ----- ----
<S> <C> <C>
/s/ FRED HASSAN President and Chief Executive July 13, 1999
- --------------------------------------------------- Officer and Director
Fred Hassan
/s/ CHRISTOPHER COUGHLIN Executive Vice President and July 13, 1999
- --------------------------------------------------- Chief Financial Officer
Christopher Coughlin (Principal Financial Officer)
/s/ ROBERT THOMPSON Senior Vice President July 13, 1999
- --------------------------------------------------- (Principal Accounting
Robert Thompson Officer)
/s/ RICHARD H. BROWN Director July 13, 1999
- ---------------------------------------------------
Richard H. Brown
/s/ FRANK C. CARLUCCI Director July 13, 1999
- ---------------------------------------------------
Frank C. Carlucci
/s/ GUSTAF A.S. DOUGLAS Director July 13, 1999
- ---------------------------------------------------
Gustaf A.S. Douglas
</TABLE>
II-4
<PAGE> 32
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- --------- ----- ----
<S> <C> <C>
/s/ M. KATHRYN EICKHOFF Director July 13, 1999
- ---------------------------------------------------
M. Kathryn Eickhoff
/s/ J. SOREN GYLL Director July 13, 1999
- ---------------------------------------------------
J. Soren Gyll
/s/ R.L. BERTHOLD LINDQVIST Director July 13, 1999
- ---------------------------------------------------
R.L. Berthold Lindqvist
/s/ OLOF G. LUND Director July 13, 1999
- ---------------------------------------------------
Olof G. Lund
/s/ C. STEVEN MCMILLAN Director July 13, 1999
- ---------------------------------------------------
C. Steven McMillan
/s/ WILLIAM U. PARFET Director July 13, 1999
- ---------------------------------------------------
William U. Parfet
/s/ ULLA B. REINIUS Director July 13, 1999
- ---------------------------------------------------
Ulla B. Reinius
/s/ BENGT SAMUELSSON Director July 13, 1999
- ---------------------------------------------------
Bengt Samuelsson
</TABLE>
II-5
<PAGE> 33
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION
- ------- -----------
<C> <S> <C>
1.1 -- Form of Underwriting Agreement for the Securities.
4.1 -- Restated Certificate of Incorporation of Pharmacia & Upjohn
(incorporated by reference to Exhibits 4.1 and 4.2 to
Pharmacia & Upjohn's Registration Statement on Form S-8
filed May 3, 1996).
4.2 -- Restated By-Laws of Pharmacia & Upjohn (incorporated by
reference to Exhibit 3.2 to Pharmacia & Upjohn's Annual
Report on Form 10-K for the year ended December 31, 1998,
filed March 30, 1999).
4.3 -- Form of Indenture.
4.4 -- Form of Debt Securities (included in Exhibit 4.3).
4.5 -- Form of Debt Warrant Agreement between Pharmacia & Upjohn,
Inc. and the Debt Warrant Agent, including a form of Debt
Warrant Certificate.
5 -- Opinion of Sullivan & Cromwell.
12.1 -- Computation of Earnings to Fixed Charges and Earnings to
Fixed Charges and Preferred Stock Dividends.
15 -- Awareness Letter from PricewaterhouseCoopers LLP, concerning
unaudited interim financial information.
23(a) -- Consent of PricewaterhouseCoopers LLP.
23(b) -- Consent of Sullivan & Cromwell (included in Exhibit 5).
24.1 -- Powers of Attorney (included in signature page).
25.1 -- Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939, as amended, of The Bank of New York.
</TABLE>
II-6
<PAGE> 1
- --------------------------------------------------------------------------------
EXHIBIT 1.1
PHARMACIA & UPJOHN, INC.
(a Delaware corporation)
Debt Securities -- Debt Warrants
Preferred Stock -- Common Stock
UNDERWRITING AGREEMENT
---------------------------
Dated as of ________, 1999
---------------------------
- --------------------------------------------------------------------------------
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
SECTION 1. Representations and Warranties.........................................................1
(a) Registration Statement.................................................................1
(b) Compliance with Securities Act Requirements............................................2
(c) No Material Adverse Change in Business.................................................2
(d) Possession of Licenses and Permits.....................................................3
(e) Intellectual Property..................................................................3
(f) Environmental Laws.....................................................................3
(g) Good Standing of the Company and Principal Subsidiaries................................3
(h) Absence of Defaults and Conflicts; Absence of Further Requirements.....................4
(i) Due Authorization, Execution and Delivery..............................................5
(j) Absence of Proceedings.................................................................5
(k) Validity of Debt Securities............................................................5
(l) Validity of Preferred Stock............................................................5
(m) Validity of Common Stock...............................................................5
SECTION 2. Purchase and Offering..................................................................5
SECTION 3. Covenants of the Company...............................................................6
SECTION 4. Conditions of Underwriters' Obligations................................................9
(a) No Stop Order..........................................................................9
(b) Opinion of Special Counsel for the Company.............................................9
(c) Opinion of Counsel for the Company.....................................................9
(d) Opinion of Counsel for Underwriters....................................................9
(e) Material Adverse Change...............................................................10
(f) Officers' Certificate.................................................................10
(g) Accountant's Comfort Letter...........................................................10
(h) Bring-down Comfort Letter.............................................................10
(i) Additional Documents..................................................................11
(j) Changes in Market Conditions..........................................................11
SECTION 5. Indemnification and Contribution......................................................11
SECTION 6. Default of Underwriters...............................................................15
SECTION 7. Reimbursement of Underwriters' Expenses...............................................16
SECTION 8. Representatives; Notices..............................................................16
SECTION 9. Survival..............................................................................17
SECTION 10. Binding Effect; Successors............................................................17
</TABLE>
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<TABLE>
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<S> <C> <C>
SECTION 11. Applicable Law........................................................................17
SECTION 12. Counterparts..........................................................................17
ANNEX 1 Pricing Agreement
EXHIBITS:
EXHIBIT A Opinion of the Company's Special Counsel to be Delivered
Pursuant to Section 4(b)
EXHIBIT B Opinion of the Company's Counsel to be Delivered Pursuant to
Section 4(c)
</TABLE>
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<PAGE> 4
PHARMACIA & UPJOHN, INC.
UNDERWRITING AGREEMENT
STANDARD PROVISIONS
From time to time, Pharmacia & Upjohn, Inc., a Delaware
corporation (the "Company"), having its corporate and its principal office in
Bridgewater, New Jersey, proposes to issue and sell certain of its debt
securities, warrants to purchase debt securities, preferred stock and common
stock, par value $.01 per share (the "Common Stock") registered under the
registration statement referred to in Section 1(a) below (the "Securities"). The
Securities constituting debt securities will be issued under an Indenture, dated
as of , 1999 (the "Indenture"), between the Company and The Bank of New
York, as Trustee, and may be issued in one or more series, which series may vary
as to interest rates, redemption provisions, selling prices and other terms. The
debt warrants will be issued under one or more separate warrant agreements (each
a "Warrant Agreement") between the Company and one or more separate
institutions, as warrant agent, each as identified in the separate Warrant
Agreement in respect of the debt warrants covered thereby (the "Warrant Agent").
Debt securities and debt warrants may be offered separately or together, and if
offered together, the debt warrants may detach from the debt securities after
the time of offering. The Securities constituting preferred stock may be issued
in one or more series, which series may vary as to dividend rates, redemption
provisions, selling prices and other terms. The particular terms of any issuance
of Securities will be determined at the time of offering. The Company intends to
enter into one or more Pricing Agreements (each a "Pricing Agreement" and
together the "Pricing Agreements") in the form of Annex I hereto, with such
additions and deletions as the parties may determine, and, subject to the terms
and conditions stated herein and therein, to issue and sell to the firms named
in Schedule I to the applicable Pricing Agreement (such firms constituting the
"Underwriters" with respect to each such Pricing Agreement and the Securities
specified therein) the particular Securities specified in Schedule II to such
Pricing Agreement (with respect to each such Pricing Agreement, the "Designated
Securities"). Each Pricing Agreement shall constitute an agreement by the
Company and the Underwriters to be bound by all of the provisions of this
Underwriting Agreement.
SECTION 1. Representations and Warranties.
The Company represents and warrants to, and agrees with the
Underwriters with respect to each offering of Designated Securities that:
(a) Registration Statement. A registration statement on Form
S-3 in respect of the Securities has been filed with the Securities and Exchange
Commission
<PAGE> 5
(the "Commission") and has become effective. The registration statement
(including the material incorporated therein by reference and all exhibits
thereto but excluding the Form T-1), as amended at the time of any Pricing
Agreement is hereinafter referred to, with respect to the transaction
contemplated by such Pricing Agreement, as the "Registration Statement". The
prospectus which forms a part of the Registration Statement or is deemed to meet
the requirements thereof (including the material incorporated therein by
reference), as then amended, and as supplemented to reflect the terms of the
Designated Securities (if they are debt securities or preferred stock) and the
terms of offering thereof, and any other material reflected in such supplement,
in the form in which it is first filed, or mailed for filing with the Commission
pursuant to Rule 424 of the Securities Act of 1933, as amended (the "Act"),
including any documents incorporated by reference therein as of the date of such
filing or mailing, is hereinafter referred to as the "Prospectus" and such
supplement is hereinafter referred to as the "Supplement".
(b) Compliance with Securities Act Requirements. (i) On its
effective date and on the effective date of the most recent post-effective
amendment thereto, the Registration Statement (including the material
incorporated therein by reference) conformed in all material respects with the
requirements of the Act, the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"), and the rules and regulations of the Commission (the "Rules and
Regulations"), and did not include any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary to
make the statements therein not misleading; and, on the date of each Pricing
Agreement and each time the Registration Statement is amended, the Registration
Statement, as then amended, will conform in all material respects with the
requirements of the Act, the Trust Indenture Act and the Rules and Regulations
and will not include any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make the
statements therein not misleading; and each time the Prospectus is amended, on
the date of each supplement thereto and on the date of the Supplement, the
Prospectus as then amended or supplemented, will conform in all material
respects with the requirements of the Act, the Trust Indenture Act and the Rules
and Regulations and will not include any untrue statement of a material fact or
omit to state any 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 that the foregoing does not apply to statements in
or omissions from any such documents based upon information furnished to the
Company in writing by any Underwriter expressly for use therein.
(ii) The documents incorporated by reference in the
Prospectus, when they became effective or were filed with the Commission, as the
case may be, conformed in all material respects to the requirements of the Act
or the Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder, and none of such documents contained an untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading; and any
further documents so filed and incorporated by reference in the Prospectus or
any further amendment or supplement thereto, when such documents become
effective or are filed with the Commission, as the case may be, will conform in
all material respects to the requirements of the Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission thereunder and will
not contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading; provided, however, that this representation and warranty shall
not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter expressly for use therein.
(c) No Material Adverse Change in Business. Except as
disclosed in the Prospectus, since the date of the latest audited financial
statements included in the Prospectus there has been no material adverse change,
nor any development or event involving a prospective material adverse change, in
the consolidated financial position,
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<PAGE> 6
stockholders' equity or results of operations of the Company and its
subsidiaries taken as a whole;
(d) Possession of Licenses and Permits. The Company and each
of its subsidiaries have all concessions, licenses, franchises, permits,
authorizations, approvals and orders of and from all governmental regulatory
officials and bodies that are necessary to own or lease their properties and
conduct their businesses as described in the Prospectus, except where the
failure to have any such concession, license, franchise, permit, authorization,
approval or order would not have a material adverse effect on the consolidated
financial position, stockholders' equity or results of operations of the Company
and its subsidiaries, taken as a whole;
(e) Intellectual Property. The Company and its subsidiaries
own or have had licensed to them or otherwise have the benefit or use under the
authority of the owners thereof, of all patents, patent rights, inventions,
trademarks, service marks, trade names and copyrights (in each case, registered
or not) which are necessary for the conduct of the business of the Company and
its subsidiaries as described in the Prospectus and, except as set forth or
contemplated in the Prospectus, there are no unresolved assertions that the
Company or any of its subsidiaries has infringed the patents, patent rights,
inventions, trademark rights, service marks, trade names or copyrights of
others, other than assertions which are not reasonably likely to have a material
adverse effect on the consolidated financial position, stockholders' equity or
results of operations of the Company and its subsidiaries, taken as a whole;
(f) Environmental Laws. The Company and its subsidiaries (A)
are in compliance with all applicable federal, state, local and foreign laws and
regulations relating to the protection of human health and safety, and the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), (B) have all permits, licenses or other
approvals required of them under applicable Environmental Laws to conduct their
businesses as described in the Prospectus and (C) are in compliance with all
terms and conditions of any such permit, license or approval, in each case
except as described in the Prospectus or except as would not, individually or in
the aggregate, result in a material adverse effect on the consolidated financial
position, stockholders' equity or results of operations of the Company and its
subsidiaries, taken as a whole;
(g) Good Standing of the Company and Principal Subsidiaries.
The Company has been duly incorporated and is validly existing as a corporation
in good standing under the laws of the State of Delaware and each Principal
Subsidiary of the Company has been duly organized and is validly existing as a
corporation under the laws of its jurisdiction of incorporation, and, in the
case of Principal Subsidiaries incorporated in the United States, is in good
standing under the laws of its jurisdiction of
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<PAGE> 7
incorporation; and each of the Company and each Principal Subsidiary of the
Company has corporate power and authority to own its properties and conduct its
business as described in the Prospectus, and has been duly qualified as a
foreign corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases properties
or conducts any business so as to require such qualification, except for any
such failure to be so qualified in any such jurisdiction which would not result
in a material adverse effect on the consolidated financial position,
stockholders' equity results of operations of the Company and its subsidiaries,
taken as a whole; as used in this Agreement, "Principal Subsidiaries" means
Pharmacia & Upjohn Company, Pharmacia & Upjohn AB, Pharmacia S.p.A. and
Pharmacia & Upjohn Caribe Inc.;
(h) Absence of Defaults and Conflicts; Absence of Further
Requirements. The sale and delivery of the Designated Securities hereunder and
the compliance by the Company with all of the provisions of the Indenture (if
the Designated Securities are debt securities), the Pricing Agreement (including
the terms of this Agreement), the Warrant Agreement (if any Designated
Securities are debt warrants) and any Delayed Delivery Contracts (as defined
herein) and the consummation of the transactions therein and herein contemplated
will not conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which the Company or
any of its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the Company
or any of its subsidiaries is subject, nor will such action result in any
violation of the provisions of the Certificate of Incorporation or By-laws of
the Company or any statute or any order, rule or regulation of any court of
governmental agency or body having jurisdiction over the Company or any of its
subsidiaries or any of their properties, except for such conflicts, breaches,
violations and defaults that would not have a material adverse effect on the
consolidated financial position, stockholders' equity or results of operations
of the Company and its subsidiaries, taken as a whole, or that would otherwise
not materially prejudice the consummation of the transactions contemplated by
the Pricing Agreement (including the terms of this Agreement), the Indenture (if
the Designated Securities are debt securities), the Warrant Agreement (if any
Designated Securities are debt warrants) and any Delayed Delivery Contracts; and
no consent, approval, authorization, order, registration or qualification of or
with any such court or governmental agency or body is required to be obtained or
made by the Company for the sale and delivery of the Designated Securities or
the consummation by the Company of the transactions contemplated by the Pricing
Agreement (including the terms of this Agreement), the Warrant Agreement (if any
Designated Securities are debt warrants) and any Delayed Delivery Contracts,
except for the registration under the Act of the Securities and such consents,
approvals, authorizations, registrations or qualifications as may be required
under state or foreign securities or Blue Sky laws in connection with the
purchase and distribution of the Designated Securities by the Underwriters;
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<PAGE> 8
(i) Due Authorization, Execution and Delivery. This Agreement
has been duly authorized, executed and delivered by the Company; and
(j) Absence of Proceedings. Other than as set forth in the
Prospectus, there are no legal or governmental proceedings pending to which the
Company or any of its subsidiaries is a party or of which any property of the
Company or any of its subsidiaries is the subject which, if determined adversely
to the Company or any of its subsidiaries, are reasonably likely, individually
or in the aggregate, to have a material adverse effect on the current or future
consolidated financial position, stockholders' equity or results of operations
of the Company and its subsidiaries, taken as a whole, and to the Company's
knowledge, no such proceedings are threatened or contemplated by governmental
authorities or threatened by others.
(k) [If the Designated Securities are debt securities:]
Validity of Debt Securities. [T]he Indenture has been duly authorized and has
been duly qualified under the Trust Indenture Act; the Designated Securities
have been duly authorized; and when the Designated Securities are delivered and
paid for pursuant to the Pricing Agreement or pursuant to Delayed Delivery
Contracts, the Indenture will have been duly executed and delivered, such
Designated Securities will have been duly executed, authenticated, issued and
delivered and will conform to the description thereof contained in the
Prospectus and the Indenture and such Designated Securities will constitute
valid and legally binding obligations of the Company, enforceable in accordance
with their terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors' rights and to general equity principles.
(l) [If the Designated Securities are preferred stock:]
Validity of Preferred Stock. [T]he Designated Securities have been duly
authorized and, when the Designated Securities have been delivered and paid for
in accordance with the Pricing Agreement, such Designated Securities will have
been validly issued, fully paid and nonassessable and will conform to the
description thereof contained in the Prospectus; and the stockholders of the
Company have no preemptive rights with respect to the Designated Securities.
(m) [If the Designated Securities are Common Stock:] Validity
of Common Stock. [T]he Designated Securities and all other outstanding shares of
capital stock of the Company have been duly authorized; all outstanding shares
of capital stock of the Company are, and, when the Designated Securities have
been delivered and paid for in accordance with the Terms Agreement, such
Designated Securities will have been, validly issued, fully paid and
nonassessable and will conform to the description thereof contained in the
Prospectus; and the stockholders of the Company have no preemptive rights with
respect to the Designated Securities.
SECTION 2. Purchase and Offering. (a) Particular sales of
Designated Securities may be made from time to time to the Underwriters of such
Designated Securities for whom the firm or firms designated as representatives
of the Underwriters of such Designated Securities in the Pricing Agreement
relating thereto will act as representatives, which may include all such
Underwriters in the absence of a syndicate (the "Representatives"). This
Underwriting Agreement, alone, shall not be construed as an obligation of the
Company to sell any of the Securities or as an obligation of any Underwriters to
purchase any of the Securities. Such obligation shall come into existence only
upon execution, by the Company and the Representatives named therein, of the
Pricing Agreement with respect to the Designated Securities specified therein.
Each Pricing Agreement shall specify the firms which will be Underwriters and
their Representatives, the principal amount and/or the number of the Designated
Securities to be purchased by each Underwriter, the purchase price to be paid by
the Underwriters, the initial public offering price and (if the Designated
Securities are debt securities or preferred stock) the terms of the Designated
Securities not already specified (in the Indenture if the Designated Securities
are debt securities), including, but not limited to, as applicable, currency in
which denominated and/or payable, interest rate (if debt securities), dividend
rate (if preferred stock), maturity (if debt securities), redemption provisions
and sinking fund requirements (if any), or not already specified in the Warrant
Agreement (if the Designated Securities are debt warrants) and whether any of
the Designated Securities may be sold pursuant to Delayed Delivery Contracts
("Delayed Delivery Contracts"). Each Pricing Agreement shall also specify the
date, time and manner of delivery and payment for the Designated Securities. A
Pricing Agreement shall be in the form of an executed writing (which may be in
counterparts), and may be evidenced by an exchange of telegraphic communications
or any other rapid transmission device designed to produce a written record of
communications transmitted. The obligations of the underwriters under this
Agreement and each Pricing Agreement shall be several and not joint.
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<PAGE> 9
(b) Upon the execution of the Pricing Agreement applicable to
any Designated Securities and authorization by the Representatives of the
release of such Designated Securities, the several Underwriters propose to offer
such Designated Securities for sale upon the terms and conditions set forth in
the Supplement relating to such Designated Securities.
(c) Designated Securities to be purchased by each Underwriter
pursuant to the Pricing Agreement relating thereto, in definitive form to the
extent practicable (unless otherwise provided in the Pricing Agreement), and in
such authorized denominations (if the Designated Securities are debt securities)
and, if applicable, registered in such names as the Representatives may request
upon at least forty-eight hours' prior notice to the Company, shall be delivered
by or on behalf of the Company to the Representatives for the account of such
Underwriter, against payment by such Underwriter or on its behalf of the
purchase price therefor by certified or official bank check or checks payable to
the order of the Company in the funds specified in such Pricing Agreement or by
wire transfer to a bank account specified by the Company, as specified in such
Pricing Agreement, all at the place and time and date specified in such Pricing
Agreement with respect to Designated Securities not being sold pursuant to
Delayed Delivery Contracts, or at such other place and time and date as the
Representatives and the Company may agree upon in writing, such time and date
being herein called the "Time of Delivery" for such Designated Securities.
SECTION 3. Covenants of the Company. In connection with each
offering of Designated Securities, the Company covenants and agrees with the
Underwriters:
(a) To make no further amendment or any supplement to the
Registration Statement or Prospectus after the date of the Pricing
Agreement relating to such Securities and prior to the Time of Delivery
for such Securities which shall be reasonably disapproved by the
Representatives for such Securities promptly after reasonable notice
thereof; to advise the Representatives promptly of any such amendment
or supplement after such Time of Delivery, provide Representatives with
a reasonable opportunity to review any such proposed amendment or
supplement and furnish the Representatives with copies thereof and to
file promptly all reports and any definitive proxy or information
statements required to be filed by the Company with the Commission
pursuant to Section 13(a) or (c), 14 or 15(d) of the Securities
Exchange Act of 1934 (the "Exchange Act") for so long as the delivery
of a prospectus is required in connection with the offering or sale of
such Securities, and during such same period to advise the
Representatives, promptly after it receives notice thereof, (i) of the
time when any amendment to the Registration Statement has become
effective or any amendment or supplement to the Prospectus has been
filed, (ii) of the issuance by the Commission of any stop order or of
any order preventing or suspending the use of the Prospectus, (iii) of
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<PAGE> 10
the suspension of the qualification of such Securities for offering or
sale in any jurisdiction, (iv) of the initiation or threatening of any
proceeding for any such purpose, or (v) of any request by the
Commission for the amending or supplementing of the Registration
Statement or Prospectus or for additional information; and in the event
of the issuance of any such stop order or of any such order preventing
or suspending the use of the Prospectus or suspending any such
qualification, to use promptly its best efforts to obtain its
withdrawal.
(b) To file the Prospectus with the Commission pursuant to and
in accordance with Rule 424 of the Act not later than the second
business day following the execution and delivery of the Pricing
Agreement.
(c) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify such Securities for
offering and sale and (if the Offered Securities are debt securities or
preferred stock) the determination of their eligibility for investment
under the securities laws of such jurisdictions as the Representatives
may request and to comply with such laws so as to permit the
continuance of sales and dealings therein in such jurisdictions for as
long as may be necessary to complete the distribution of such
Securities, provided that in connection therewith the Company shall not
be required to qualify as a foreign corporation or to file a general
consent to service of process in any jurisdiction.
(d) To furnish the Underwriters with copies of the Prospectus
in such quantities as the Representatives may from time to time
reasonably request, and, if the delivery of a prospectus is required at
any time prior to the expiration of nine months after the date of the
Pricing Agreement in connection with the offering or sale of such
Securities and if at such time any event shall have occurred as a
result of which the Prospectus as then amended or supplemented would
include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made when such
Prospectus is delivered, not misleading, or, if for any other reason it
shall be necessary during such same period to amend or supplement the
Prospectus or to file under the Exchange Act any document incorporated
by reference in the Prospectus in order to comply with the Act, the
Exchange Act or the Trust Indenture Act, to notify the Representatives
and upon their request to file such document and to prepare and furnish
without charge to each Underwriter and to any dealer in the Securities
as many copies as the Representatives may from time to time reasonably
request of such amended Prospectus or a supplement to the Prospectus
which will correct such statement or omission or effect such
compliance.
(e) To make generally available to its security holders as
soon as practicable, but in any event not later than sixteen months
after the date of each Pricing Agreement, an earnings statement of the
Company and its consolidated subsidiaries (which need not be audited)
complying with Section 11(a) of the Act
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<PAGE> 11
and the Rules and Regulations of the Commission thereunder (including,
at the option of the Company, Rule 158 of the Act).
(f) [If the Designated Securities are debt securities or
preferred stock, insert: During the period beginning from the date of
the Pricing Agreement for such Designated Securities and continuing to
and including the earlier of (i) the termination of trading
restrictions on such Designated Securities, of which termination the
Representatives agree to give the Company prompt notice confirmed in
writing, and (ii) the Time of Delivery for such Designated Securities,
not to offer, sell, contract to sell or otherwise dispose of any debt
securities of the Company which mature more than one year after such
Time of Delivery (if the Designated Securities are debt securities) or
any series of preferred stock of the Company (if the Designated
Securities are preferred stock), which in either case are substantially
similar to such Designated Securities without the prior written consent
of the Representatives, except pursuant to arrangements of which the
Representatives have been advised by the Company prior to the time of
execution of such Pricing Agreement, which advice is confirmed in
writing to the Representatives by the end of the business day following
the date of such Pricing Agreement.]
[If the Designated Securities are Common Stock, insert: The
Company will not offer, sell, contract to sell, pledge or otherwise
dispose of, directly or indirectly, or file with the Commission a
registration statement under the Act relating to, any additional shares
of its Common Stock or securities convertible into or exchangeable or
exercisable for any shares of its Common Stock, or publicly disclose
the intention to make any such offer, sale, pledge, disposition or
filing, without the prior written consent of the Representatives for a
period beginning at the time of execution of the Pricing Agreement and
ending the number of days after the Time of Delivery for the Designated
Securities specified in the Pricing Agreement, except issuances of
Common Stock pursuant to the conversion or exchange of convertible or
exchangeable securities or the exercise of warrants or options, in each
case outstanding on the date of the Pricing Agreement, grants of
employee stock options pursuant to the terms of a plan in effect on the
date of the Pricing Agreement, issuances of Common Stock pursuant to
the exercise of such options or issuances of Common Stock pursuant to
the Company's dividend reinvestment plan.]
(g) To pay all expenses incident to the performance of the
Company's obligations under this Agreement, and to reimburse the
Underwriters for any expenses (including fees and disbursements of
counsel) incurred in connection with qualifications of the Designated
Securities for sale and (if the Designated Security are debt
securities) determination of their eligibility for investment under
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<PAGE> 12
the laws of such jurisdictions as the Representatives designate and the
printing of memoranda relating thereto and (if the Designated Security
are debt securities) for any fees charged by investment rating agencies
for rating of the Designated Securities.
SECTION 4. Conditions of Underwriters' Obligations. The
obligations of the Underwriters of any Designated Securities hereunder are
subject to the accuracy, as of the Time of Delivery for the Designated
Securities, of the representations and warranties of the Company contained in
Section 1 hereof, to the performance by the Company of its covenants and other
obligations hereunder to be performed at or prior to such Time of Delivery, and
to the following further conditions:
(a) No Stop Order. No stop order suspending the effectiveness
of the Registration Statement shall have been issued and no proceeding for that
purpose shall have been initiated or threatened by the Commission.
(b) Opinion of Special Counsel for the Company. The
Representatives shall have received an opinion or opinions, dated the Time of
Delivery for the Designated Securities, of Sullivan & Cromwell, counsel for the
Company, in form and substance reasonably satisfactory to counsel for the
Underwriters, together with signed or reproduced copies of such opinions for
each of the other Underwriters, collectively to the effect set forth in Exhibit
A hereto. In giving such opinion such counsel may rely, as to all matters
governed by the laws of jurisdictions other than the law of the State of New
York, the federal law of the United States, and the General Corporation Law of
the State of Delaware, upon the opinions of counsel satisfactory to the
Representatives. Such counsel may also state that, insofar as such opinion
involves factual matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Company and its subsidiaries and certificates of
public officials.
(c) Opinion of Counsel for the Company. The Representatives
shall have received the opinion, dated the Time of Delivery for the Designated
Securities, of Don W. Schmitz, counsel for the Company, in form and substance
satisfactory to counsel for the Underwriters, together with signed or reproduced
copies of such opinions for each of the other Underwriters, collectively to the
effect set forth in Exhibit B hereto.
(d) Opinion of Counsel for Underwriters. The Representatives
shall have received the opinion, dated the Time of Delivery, of Shearman &
Sterling, counsel for the Underwriters, or such other counsel as may be
designated by the Underwriters, together with signed or reproduced copies of
such letter for each of the other Underwriters with respect to such matters as
they may reasonably request. In giving such opinion such counsel may rely, as to
all matters governed by the laws of jurisdictions other than the law of the
State of New York, the federal law of the United States, and the
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<PAGE> 13
General Corporation Law of the State of Delaware, upon the opinions of counsel
satisfactory to the Representatives. Such counsel may also state that, insofar
as such opinion involves factual matters, they have relied, to the extent they
deem proper, upon certificates of officers of the Company and its subsidiaries
and certificates of public officials.
(e) Material Adverse Change. There shall not have been, since
the respective dates as of which information is given in the Prospectus, any
material adverse change, or development involving a prospective material adverse
change, in the consolidated financial position, stockholders' equity or results
of operations of the Company and its subsidiaries, except as set forth or
contemplated in the Prospectus, the effect of which is, when viewed in relation
to the Company and its subsidiaries, taken as a whole, in the reasonable
judgment of the Representatives so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the delivery
of the Designated Securities on the terms and in the manner contemplated in the
Prospectus.
(f) Officers' Certificate. The Company shall have furnished or
caused to be furnished to the Representatives at the Time of Delivery for the
Designated Securities a certificate signed by the President or a Vice President
of the Company and by the chief financial or chief accounting officer of the
Company, dated the Time of Delivery for the Designated Securities, to the effect
that (i) there has not occurred any material adverse change contemplated in
paragraph (e) of this Section 4, (ii) the representations and warranties in
Section 1 hereof are true and correct with the same force and effect as though
expressly made at the Time of Delivery for the Designated Securities, (iii) the
Company has complied with all agreements and satisfied all conditions on its
part to be performed or satisfied pursuant to this Agreement at or prior to the
Time of Delivery for the Designated Securities, and (iv) no stop order
suspending the effectiveness of the Registration Statement has been issued and
no proceedings for that purpose have been instituted or are pending or are
contemplated by the Commission.
(g) Accountant's Comfort Letter. At the time of the execution
of the Pricing Agreement relating to the Designated Securities, the
Representatives shall have received from PricewaterhouseCoopers LLP a letter
dated such date, in form and substance satisfactory to the Representatives,
together with signed or reproduced copies of such letter for each of the other
Underwriters, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to underwriters with respect to the
financial statements and certain financial information contained in the
Registration Statement and the Prospectus.
(h) Bring-down Comfort Letter. At the Time of Delivery for the
Designated Securities, the Representatives shall have received from
PricewaterhouseCoopers LLP a letter, dated such Time of Delivery, to the effect
that it
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<PAGE> 14
reaffirms the statements made in the letter furnished pursuant to subsection (g)
of this Section 4, except that the specified date referred to shall be a date
not more than three business days prior to such Time of Delivery.
(i) Additional Documents. At the Time of Delivery for the
Designated Securities, counsel for the Underwriters 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 Designated Securities
as herein contemplated, or in order to evidence the accuracy of any of the
representations or warranties, or the fulfillment of any of the conditions,
herein contained.
(j) Changes in Market Conditions. Subsequent to the date of
the Pricing Agreement relating to the Designated Securities, there shall not
have occurred any of the following: (i) any downgrading in the rating of any
debt securities of the Company by Moody's Investors Service, Inc. or Standard
and Poor's Ratings Group, or any public announcement that either organization
has under surveillance or review its rating of any debt securities of the
Company (other than an announcement with positive implications of a possible
upgrading, and no implication of a possible downgrading, of such rating), (ii)
trading in the Company's common stock shall have been suspended on the New York
Stock Exchange or trading in securities generally on the New York Stock Exchange
shall have been suspended or limited, (iii) a banking moratorium shall have been
declared either by Federal or New York State authorities, or (iv) there shall
have occurred any outbreak or material escalation of hostilities in which the
United States is involved or other substantial national or international
calamity or crisis if the effect of any such event described in this clause (iv)
on the financial markets of the United States, in the reasonable judgment of the
Representatives, makes it impracticable or inadvisable to proceed with the
public offering or the delivery of the Designated Securities on the terms and in
the manner contemplated in the Prospectus.
SECTION 5. Indemnification and Contribution.
(a) The Company will indemnify and hold harmless each
Underwriter against any losses, claims, damages or liabilities, joint or
several, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in any Registration Statement, the
Prospectus or any amendment or supplement thereto, or any related preliminary
prospectus supplement (or contained in any Registration Statement after it first
becomes effective but prior to the Pricing Agreement or in any prospectus
forming a part thereof during such period), or any document incorporated by
reference therein, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and will reimburse each
Underwriter for any legal or other expenses reasonably incurred by such
Underwriter in connection with investigating or defending any such action or
claim; provided, however, that the Company shall not be liable in any such case
to the extent that any such loss, claim, damage or liability arises out of or is
based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in any of such documents in
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<PAGE> 15
reliance upon and in conformity with written information furnished to the
Company by any Underwriter, directly or through the Representatives, expressly
for use therein; and provided, further, that the Company shall not be liable to
any Underwriter under the indemnity agreement in this subsection (a) to the
extent that any such loss, claim, damage or liability of such Underwriter
results from the fact that such Underwriter sold Securities to a person to whom
there was not sent or given, at or prior to the written confirmation of such
sale, a copy of the Prospectus or the Prospectus as then amended or supplemented
(excluding documents incorporated by reference) in any case where such delivery
is required by the Act and the untrue statement or omission of a material fact
contained in the Prospectus, any such amendment or supplement thereto or any
such other document was corrected in the Prospectus or the Prospectus as then
amended or supplemented if the Company has furnished prior to such confirmation
sufficient copies thereof to such Underwriter.
(b) Each Underwriter will, severally and not jointly,
indemnify and hold harmless the Company against any losses, claims, damages or
liabilities to which the Company may become subject, under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or alleged untrue
statement of a material fact contained in any Registration Statement, the
Prospectus or any amendment or supplement thereto, or any related preliminary
prospectus supplement, or any document incorporated by reference therein, or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity with written
information furnished to the Company by such Underwriter, directly or through
the Representatives, expressly for use therein; and will reimburse the Company
for any legal or other expenses reasonably incurred by the Company in connection
with investigating or defending any such action or claim.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of any claim or of the commencement of any
action for which indemnification under subsection (a) or (b) may be requested,
such indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under such subsection, notify the indemnifying
party in writing thereof. The omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party. In
case any such action shall be brought against any indemnified party and it shall
notify the indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it may
elect by written notice delivered to the indemnified party promptly after
receiving the aforesaid notice from such indemnified party, to assume the
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<PAGE> 16
defense thereof, with counsel satisfactory to such indemnified party; provided,
however, that if the defendants in any such action include both the indemnified
party and the indemnifying party and the indemnified party shall have reasonably
concluded that there may be legal defenses available to it or other indemnified
parties, or both, which are different from or additional to those available to
the indemnifying party, the indemnified party or parties shall have the right to
select separate counsel to assert such legal defenses and to otherwise
participate in the defense of such action on behalf of such indemnified party or
parties. Upon receipt of notice from the indemnifying party to such indemnified
party or its election so to assume the defense of such action and approval by
the indemnified party of counsel, the indemnifying party will not be liable to
such indemnified party under such subsection for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof (other than reasonable costs of investigation conducted at the request
of such indemnifying party) unless (i) the indemnified party shall have employed
separate counsel in connection with the assertion of legal defenses in
accordance with the proviso to the next preceding sentence (it being understood,
however, that the indemnifying party shall not be liable for the expenses of
more than one separate counsel, approved by such indemnifying party,
representing the indemnified parties under such subsection who are parties to
such action), (ii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of commencement of the action or (iii) the
indemnifying party has authorized the employment of counsel for the indemnified
party at the expense of the indemnifying party; and except that, if clause (i)
or (iii) is applicable, such liability shall be only in respect of the counsel
referred to in such clause (i) or (iii). No indemnifying party shall, without
the written consent of the indemnified party, effect the settlement or
compromise of, or consent to the entry of any judgment with respect to, any
pending or threatened action or claim in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified party is an
actual or potential party to such action or claim) unless such settlement,
compromise or judgment (i) includes an unconditional release of the indemnified
party from all liability arising out of such action or claim and (ii) does not
include a statement as to or an admission of fault, culpability or a failure to
act, by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 5
shall be unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the Underwriters
on the other from the offering of the Designated Securities and also the
relative fault of the Company on the one hand and the Underwriters on the other
in connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions in respect thereof), as well as any
other relevant equitable considerations. The relative benefits received by the
Company on the one hand and the Underwriters on the other in connection with the
offering of the Designated Securities shall be deemed to be in the same
proportion as the total net proceeds from the offering of such Securities
(before deducting expenses) received by the Company bears to the total
underwriting discounts and commissions received by the Underwriters in respect
thereof, in each case as set forth in the Prospectus. The relative fault shall
be determined by reference
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<PAGE> 17
to, among other things, whether the indemnified party failed to give the notice
required under subsection (c) above, including the consequences of such failure,
and 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 on the one hand or the Underwriters on the other and the
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission, of the Company on the one hand and the
Underwriters, directly or through the Representatives, on the other hand.
The Company and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this subsection (d) were
determined by pro rata allocation (even if the Underwriters were treated as
one entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to above in this
subsection (d). The amount paid or payable by an indemnified party as a result
of the losses, claims, damages or liabilities (or actions in respect thereof)
referred to above in this subsection (d) shall be deemed to include any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (d), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the applicable Designated Securities underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The obligations of the Underwriters in this
subsection (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(e) The obligations of the Company under this Section 5 shall
be in addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who controls
any Underwriter within the meaning of the Act, and the obligations of the
Underwriters under this Section 5 shall be in addition to any liability which
the respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each director of the Company, to each officer of the
Company who signs the Registration Statement and to each person, if any, who
controls the Company within the meaning of the Act.
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<PAGE> 18
SECTION 6. Default of Underwriters. (a) If any Underwriter
shall default in its obligation to purchase the Designated Securities which it
has agreed to purchase under the Pricing Agreement relating to such Designated
Securities, the Representatives may in their discretion arrange for themselves
or another party or other parties to purchase such Designated Securities on the
terms contained herein. If within thirty-six hours after such default by any
Underwriter the Representatives do not arrange for the purchase of such
Designated Securities, then the Company shall be entitled to a further period of
thirty-six hours within which to procure another party or other parties
satisfactory to the Representatives to purchase such Designated Securities on
such terms. In the event that, within the respective prescribed periods, the
Representatives notify the Company that they have so arranged for the purchase
of such Designated Securities, or the Company notifies the Representatives that
it has so arranged for the purchase of such Designated Securities, the
Representatives or the Company shall have the right to postpone the Time of
Delivery for such Designated Securities for a period of not more than seven
days, in order to effect whatever changes may thereby be made necessary in the
Registration Statement or the Prospectus, or in any other documents or
arrangements, and the Company agrees to file promptly any amendments or
supplements to the Registration Statement or the Prospectus which in the opinion
of the Representatives may thereby be made necessary. The term "Underwriter" as
used in the Agreement shall include any person substituted under this Section
with like effect as if such person had originally been a party to the Pricing
Agreement with respect to such Designated Securities.
(b) If, after giving effect to any arrangements for the
purchase of the Designated Securities of a defaulting Underwriter or
Underwriters by the Representatives or the Company, or both, as provided in
subsection (a) above, the aggregate principal amount (if debt securities or debt
securities which include debt warrants) or number of shares (if preferred stock
or Common Stock) of such Designated Securities which remains unpurchased does
not exceed one-tenth of the aggregate principal amount or number of shares, as
applicable, of the Designated Securities, then the Company shall have the right
to require each non-defaulting Underwriter to purchase the principal amount or
number of shares, as applicable, of Designated Securities which such Underwriter
agreed to purchase under the Pricing Agreement relating to such Designated
Securities and, in addition, to require each non-defaulting Underwriter to
purchase its pro rata share (based on the principal amount or number of shares,
as applicable, of Designated Securities which such Underwriter agreed to
purchase under such Pricing Agreement) of the Designated Securities of such
defaulting Underwriter or Underwriters for which such arrangements have not been
made; but nothing herein shall relieve a defaulting Underwriter from liability
for its default. As used in this paragraph (b) and in paragraph (c) below of
this Section 6, the "aggregate principal amount" of Designated Securities shall
mean the aggregate principal amount of the Designated Securities that are
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<PAGE> 19
debt securities plus the public offering price, if any, of any debt warrants
included in the Designated Securities.
(c) If, after giving effect to any arrangements for the
purchase of the Designated Securities of a defaulting Underwriter or
Underwriters by the Representatives or the Company, or both, as provided in
subsection (a) above, the aggregate principal amount (if debt securities) or
number of shares (if preferred stock or Common Stock) of Designated Securities
which remains unpurchased exceeds one-tenth of the aggregate principal amount or
number of shares, as applicable, of the Designated Securities, or if the Company
shall not exercise the right described in subsection (b) above to require
non-defaulting Underwriters to purchase Designated Securities of a defaulting
Underwriter or Underwriters, then the Pricing Agreement relating to such
Designated Securities shall thereupon terminate, without liability on the party
of any non-defaulting Underwriter or the Company, except for the expenses to be
borne by the Company and the Underwriters provided in Section 3(g) hereof and
the indemnity and contribution agreements in Section 5 hereof; but nothing
herein shall relieve a defaulting Underwriter from liability for its default.
SECTION 7. Reimbursement of Underwriters' Expenses. If any
Pricing Agreement shall be terminated pursuant to Section 6 hereof or if the
Designated Securities are not delivered by or on behalf of the Company because
of any of the events referred to in Section 4(j), then the Company shall not
then be under any liability to any Underwriter with respect to Designated
Securities covered by such Pricing Agreement except as provided in Section 3(g)
and Section 5 hereof; but, if for any other reason Designated Securities are not
delivered by or on behalf of the Company as provided herein, the Company will
reimburse the Underwriters through the Representatives for all out-of-pocket
expenses approved in writing by the Representatives, including fees and
disbursements of counsel, reasonably incurred by the Underwriters in making
preparations for the purchase, sale and delivery of such Designated Securities,
but the Company shall then be under no further liability to any Underwriter with
respect to such Designated Securities except as provided in Section 3(g) and
Section 5 hereof.
SECTION 8. Representatives; Notices. In all dealings
hereunder, the Representatives of the Underwriters of Designated Securities
shall act on behalf of each of such Underwriters, and the parties hereto shall
be entitled to act and rely upon any statement, request, notice, waiver or
agreement on behalf of any Underwriter made or given by such Representatives.
All statements, requests, notices and agreements hereunder
shall be in writing or by telegram if promptly confirmed in writing and if to
the Underwriters shall be sufficient in all respects, if delivered or sent by
registered mail to the address of the Representatives as set forth in the
Pricing Agreement; and if to the Company shall be
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<PAGE> 20
sufficient in all respects if delivered or sent by registered mail to the
address of the Company set forth in the Registration Statement: Attention:
Secretary; provided, however, that any notice to any Underwriter pursuant to
Section 5(c) hereof shall be delivered or sent by registered mail to such
Underwriter at its address set forth in the applicable Pricing Agreement or, if
not so set forth, in its Underwriters' Questionnaire delivered to the Company.
SECTION 9. Survival. The respective indemnities, agreements,
representations, warranties and other statements of the Company and the several
Underwriters, as set forth in this Agreement and the Pricing Agreement or made
by or on behalf of them, respectively, pursuant to this Agreement and the
Pricing Agreement, shall remain in full force and effect, regardless of any
investigation (or any statements as to the results thereof) made by or on behalf
of any Underwriter or any controlling person of any Underwriter, or the Company,
or any officer or director or controlling person of the Company, and shall
survive delivery of and payment for the Securities.
SECTION 10. Binding Effect; Successors. This Agreement and
each Pricing Agreement shall be binding upon, and inure solely to the benefit
of, the Underwriters, the Company and, to the extent provided in Section 5 and
Section 7 hereof, the officers and directors of the Company and each person who
controls the Company or any Underwriter, and their respective heirs, executors,
administrators, successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement or any such Pricing
Agreement. No purchaser of any of the Securities from any Underwriter shall be
deemed a successor or assign by reason merely of such purchase.
SECTION 11. Applicable Law. THIS AGREEMENT AND EACH PRICING
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK.
SECTION 12. Counterparts. This Agreement and each Pricing
Agreement may be executed by any one or more of the parties hereto and thereto
in any number of counterparts, each of which shall be deemed to be an original,
but all such respective counterparts shall together constitute one and the same
instrument.
If the foregoing is in accordance with your understanding,
please sign and return to us two counterparts hereof.
Very truly yours,
Pharmacia & Upjohn, Inc.
----------------------------------------
By:
Title:
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<PAGE> 21
Accepted as of the date first above written:
[Insert signature block[s] for the
Representative[s], acting on behalf of the
Underwriters, or for each Underwriter if no
syndicate]
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<PAGE> 22
ANNEX I
PRICING AGREEMENT
[Debt Securities] [Debt Warrants] [Preferred Stock] [Common Stock] [Date]
To the [Underwriter[s] named in Schedule I]
[Representative[s] named in Schedule II
of the Underwriters named in Schedule I]
Dear Sirs:
Pharmacia & Upjohn, Inc. (the "Company") proposes subject to the terms
and conditions stated herein and in the Underwriting Agreement, dated [date]
(the "Underwriting Agreement"), between the Company on the one hand and [ ] on
the other hand, to issue and sell to the Underwriters named in Schedule I hereto
(the "Underwriters") the Securities specified in Schedule II hereto (the
"Designated Securities"). Each of the provisions of the Underwriting Agreement
is incorporated herein by reference in its entirety, and shall be deemed to be a
part of this Agreement to the same extent as if such provision had been set
forth in full herein; and each of the representations and warranties set forth
therein shall be deemed to have been made at and as of the date of this Pricing
Agreement. Each reference to the Representatives herein and in the provisions of
the Underwriting Agreement so incorporated by reference shall be deemed to refer
to you. Unless otherwise defined herein, terms defined in the Underwriting
Agreement are used herein as therein defined.
The Company has delivered to you for each of the Underwriters copies of
the Registration Statement and Prospectus, including the documents incorporated
therein by reference. The Prospectus (including the Supplement relating to the
Designated Securities) in the form heretofore delivered to you is now proposed
to be filed, or mailed for filing, with the Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement, the Company agrees to issue and sell to each of the
Underwriters, and each of the Underwriters agrees, severally and not jointly, to
purchase from the Company, at the time and place and at the purchase price to
the Underwriters set forth in Schedule II hereto, the principal amount or
number, as applicable, of Designated Securities set forth opposite the name of
such Underwriter in Schedule I hereto.
[The Company authorizes the Underwriters to solicit offers to purchase
Designated Securities from the Company pursuant to Delayed Delivery Contracts
substantially in the form of Schedule III hereto but with such changes therein
as the
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<PAGE> 23
Company may approve. The Underwriters will endeavor to make such arrangements
and, as compensation therefor, the Company will pay to the Representatives, for
the account of the Underwriters, at the Time of Delivery a commission in the
amount set forth in Schedule II. Delayed Delivery Contracts are to be with
purchasers of the types approved by the Company and set forth in the Prospectus
and subject to other conditions set forth in such Delayed Delivery Contracts.
Except as the Company may otherwise agree, each Delayed Delivery Contract must
be for the minimum principal amount or number of shares, as applicable, set
forth in Schedule II hereto and the aggregate principal amount of all Delayed
Delivery Contracts may not exceed the amount or number of shares, as applicable,
set forth in such Schedule II. The Underwriters will not have any responsibility
in respect of the validity or performance of any Delayed Delivery Contracts.]
[If the Company executes and delivers Delayed Delivery Contracts, the
Securities subject to such contracts shall be deducted from the Designated
Securities to be purchased by the several Underwriters and the aggregate
principal amount or number of shares, as applicable, of Designated Securities to
be purchased by each Underwriter shall be reduced pro rata in proportion to the
principal amount or number of shares, as applicable, of Designated Securities
set forth opposite each Underwriter's name in Schedule I hereto, except to the
extent that the Representatives determine that such reduction shall be otherwise
and so advise the Company in writing; provided, however, that the total
principal amount or number of shares, as applicable, of Designated Securities to
be purchased by all Underwriters shall be the total principal amount or number
of shares, as applicable, of Designated Securities set forth in Schedule I
hereto less the principal amount or number of shares, as applicable, of
Designated Securities covered by Delayed Delivery Contracts. As used in this
paragraph and in the immediately preceding paragraph, the "aggregate principal
amount" of Designated Securities shall mean the aggregate principal amount of
the Designated Securities that are debt securities plus the public offering
price, if any, of any debt warrants included in the Designated Securities.]
If the foregoing is in accordance with your understanding, please sign
and return to us two counterparts hereof, and upon acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof,
including the provisions of the Underwriting Agreement incorporated herein by
reference, shall constitute a binding agreement between each of the Underwriters
and the Company. It is understood that your
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<PAGE> 24
acceptance of this letter on behalf of each of the Underwriters is or will be
pursuant to authority granted to you by such Underwriter.
Very truly yours,
Pharmacia & Upjohn, Inc.
- ---------------------
By:
Title:
Accepted as of the date hereof:
[Insert signature block[s] for the
Representative[s], acting on behalf of the
Underwriters, or for each Underwriter if no
syndicate.]
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<PAGE> 25
SCHEDULE I
<TABLE>
<CAPTION>
Underwriters [Principal Amount] [Number of Designated
[Number] of Designated Securities that are Debt
Securities to be Warrants to be Purchased]
Purchased
<S> <C> <C>
[Names of Underwriters]
Total
</TABLE>
I-1
<PAGE> 26
SCHEDULE II
[Debt Securities] [Preferred Stock] [Common Stock]
[If Designated Securities are debt securities or debt securities which include
debt warrants, insert:
Title of Designated Securities:
[. .]% [Floating Rate] [Zero Coupon] [Notes] [Debentures] due . . . . .
Aggregate Principal Amount:
[$]. . . . . . . . . . . . . . . . . .
Price to Public:
. .% of the principal amount of the Designated Securities, plus accrued
interest from . . . . . . . . to the time of Delivery [and accrued
amortization, if any, from . . . . . . . to the Time of Delivery]
Purchase Price by Underwriters:
. .% of the principal amount of the Designated Securities, plus accrued
interest from . . . . . . to the Time of Delivery [and accrued
amortization, if any, from . . . . . . to the Time of Delivery]
Indenture:
Indenture, dated as of __________, 1999, between the Company and
[______________________], as Trustee
Maturity:
. . . . . . . . . . . . . . . . . . . .
Interest Rate:
[. .]% [Zero Coupon] [See Floating Rate Provisions] [See Event Risk
Provisions]
Interest Payment Dates:
[months and dates]
II-1
<PAGE> 27
Redemption Provisions:
[No provisions for redemption]
[The Designated Securities may be redeemed [otherwise than through the
sinking fund,] in whole or in part at the option of the Company, in the
amount of [$]. . . . . . . . . or an integral multiple thereof, ]
[on or after. . . . . . . . . . . . . . . . at the following redemption
prices (expressed in percentages of principal amount). If redeemed on
or before . . . . . . . . . . ., . . . .%, and if] redeemed during the
12-month period beginning . . . . . . . . . . . .
Year Redemption Price . . . . . . . . .and thereafter at 100%
of their principal amount, together in each case with accrued interest
to the redemption date.]
[on any interest payment date falling on or after . . . . . . . . . . .
. , at the election of the Company, at a redemption price equal to the
principal amount thereof, plus accrued interest to the date of
redemption.]
[Other possible redemption provisions, such as mandatory redemption upon
occurrence of certain events or redemption for changes in tax law.]
Sinking Fund Provisions:
[No sinking fund provisions]
[The Designated Securities are entitled to the benefit of a sinking
fund to retire [$]. . . . . . . . . . . principal amount of Designated
Securities on . . . . . . . . . in each of the years . . . . . . . .
through . . . . . . . at 100% for their principal amount plus accrued
interest] [, together with [cumulative] [noncumulative] redemptions at
the option of the Company to retire an additional [$] . . . . . . . .
principal amount of Designated Securities in the years . . . . .
through . . . . . . . at 100% of their principal amount plus accrued
interest.]
[If Securities are extendable debt Securities, insert--
Extendable Provisions:
Securities are repayable on . . . . . . . . . . . . . ., . . .
. . [[insert date and years,] at the option of the holder, at their
principal amount with accrued interest. Initial annual interest rate
will be . . .%, and thereafter annual interest rate will be
II-2
<PAGE> 28
adjusted on . . . . . . . . . . . . ., . . . . and . . . . . to a rate
not less than . . . . .% of the effective annual interest rate on U.S.
Treasury obligations with . . . .-year maturities as of the [insert
date 15 days prior to maturity date] prior to such [insert maturity
date].]
[If Securities are Floating Rate debt Securities, insert--
Floating Rate Provisions:
Initial annual interest rate will be . . . .% through . . . .
. . . . .[and thereafter will be adjusted [monthly] [on each . . . . .
. . . . . , . . . . . . ., . . . . . . and . . . . . ] [to an annual
rate of . . . .% above the average rate for . . . . . .-year [month]
[securities] [certificates of deposit] by . . . . . . . . and . . . . .
. . . . . . . [insert names of banks].] [and the annual interest rate
[thereafter] [from . . . . . . through . . . . . ] will be the interest
yield equivalent of the weekly average per annum market discount rate
for . . . . .-month Treasury bills plus . . . .% of Interest
Differential (the excess, if any, of (i) then current weekly average
per annum secondary market yield for . . . . .-month certificates of
deposit over (ii) then current interest yield equivalent of the weekly
average per annum market discount rate for . . . . .-month Treasury
bills]; [from . . . . . . and thereafter the rate will be the then
current interest yield equivalent plus . . . .% of Interest
Differential].]
Issuable in temporary global form: [Yes] [No]
Issuable in permanent global form: [Yes] [No] ]
[If Designated Securities are debt warrants, insert:
Number of Debt Warrants to be issued:
Warrant Agreement:
Form of Debt Warrants: [Registered]
Issuable jointly with other Securities: [Yes] [No]
[Number of Debt Warranties issued with each ........ amount or
$.......... principal amount of other Securities]
[Detachable Date:]
Date from which Debt Warrants are exercisable:
II-3
<PAGE> 29
Date on which Debt Warrants expire:
Exercise price(s) of Debt Warrants:
Public offering price: $. . . . . . . . .
Purchase price: $. . . . . . . . .
Title and terms of Warrant Securities:
Principal Amount of Warrant Securities purchasable upon exercise of one
Warrant:]
[If Designated Securities are preferred stock or Common Stock, insert:
Title of Designated Securities:
Number of Shares:
Dividend Rate (1):
Optional Redemption (1):
Sinking Fund (1):
Listing (1): [None.] [ Stock Exchange.] [The Nasdaq Stock Market.]
Delayed Delivery Contracts (1): [None.] [Delivery Date[s] shall be
, 19 . Underwriters' fee is $ per share of the Delayed
Delivery Contract Securities.]
Purchase Price: $ per share [If preferred stock issue, insert--plus
accrued dividends[, if any,] from , 19 ].
Expected Reoffering Price: $ per share, subject to change by the
[Representative[s]] [Underwriters].
Closing: A.M. on , 19 , at ,
in New York Clearing House (next day) funds.
- --------
(1) To be included only if Terms Agreement relates to preferred stock.
II-4
<PAGE> 30
Underwriter[s']['s] Compensation (1): $ payable to the [Representative[s]
for the proportionate accounts of the] Underwriter[s] on the Closing Date.
Blackout: Until days after the Closing Date.
[Name[s] and Address[es] of [Representative[s]]
[Underwriter[s]]:] ]
- --------
(1) Include if purchase is at public offering price and compensation
payable separately.
II-5
<PAGE> 31
SCHEDULE III
Delayed Delivery Contract
Pharmacia & Upjohn, Inc.
c/o: [Date]
Attention:
Dear Sirs:
The undersigned hereby agrees to purchase from Pharmacia & Upjohn, Inc.
(hereinafter called the "Company"), and the Company agrees to sell to the
undersigned [[$]
principal amount] [number] of the Company's [Title of Designated Securities]
(hereinafter called the "Designated Securities"), offered by the Company's
Prospectus dated , 19 [as amended or supplemented], receipt of a copy of which
is hereby acknowledged, at a purchase price of [ % of the principal amount
thereof, plus accrued interest from the date from which interest accrues as set
forth below] [ per share], and on the further terms and conditions set
forth in this contract.
[The undersigned will purchase the Designated Securities from the
Company on , 19 (the "Delivery Date") [and interest on the Designated
Securities so purchased
will accrue from , 19 .]]
[The undersigned will purchase the Designated Securities from the
Company on the delivery date or dates and in the principal amount or amounts set
forth below:
<TABLE>
<CAPTION>
Delivery Date [Principal Amount] [Date from Which Interest
[Number of Debt Accrues]
Warrants/Shares]
<S> <C> <C>
, 19 [$] , 19
, 19 [$] , 19
</TABLE>
Each such date on which Designated Securities are to be purchased hereunder is
hereinafter referred to as a "Delivery Date".]
III-1
<PAGE> 32
Payment for the Designated Securities which the undersigned has agreed
to purchase on [the] [each] Delivery Date shall be made to the Company or its
order by certified or official bank check in funds at the office of
, , or by wire transfer to a bank account
specified by the Company, on [the] [such] Delivery Date upon delivery to the
undersigned of the Designated Securities then to be purchased by the undersigned
in definitive [bearer] [fully registered] form and in such denominations and
[registered in such names] as the undersigned may designate by written or
telegraphic communication addressed to the Company not less than five business
days prior to [the] [such] Delivery Date.
The obligation of the undersigned to take delivery of and make payment
for Designated Securities on [the] [each] Delivery Date shall be subject to the
conditions that (a) the purchase of Designated Securities to be made by the
undersigned shall not on [the] [such] Delivery Date be prohibited under the laws
of the jurisdiction to which the undersigned is subject and (b) the Company, on
or before , 19 , shall have sold to the several Underwriters, pursuant to
the Pricing Agreement dated , 19 with the Company, an [aggregate
principal amount and/or number] of Designated Securities equal to ,
minus the aggregate principal amount and/or a number] of Designated Securities
to be covered by this contract and other contracts similar to this contract. The
obligation of the undersigned to take delivery of and make payment for the
Designated Securities shall not be affected by the failure of any purchaser to
take delivery of and make payment for Designated Securities pursuant to other
contracts similar to this contract.
Promptly after completion of the sale of the Designated Securities to
the Underwriters, the Company will mail or deliver to the undersigned at its
address set forth below notice to such effect, accompanied by a copy of the
Opinion or Opinions of Counsel for the Company delivered to the Underwriters in
connection therewith.
The undersigned represents and warrants that, as of the date of this
contract, the undersigned is not prohibited from purchasing the Designated
Securities hereby agreed to be purchased by it under the laws of the
jurisdiction to which the undersigned is subject.
The contract will inure to the benefit of and be binding upon the
parties hereto and their respective successors, but will not be assignable by
either party hereto without the written consent of the other.
This contract may be executed by either of the parties hereto in any
number of counterparts, each of which shall be deemed to be an original, but all
such counterparts shall together constitute one and the same instrument.
III-2
<PAGE> 33
It is understood that the acceptance of the Company of any Delayed
Delivery Contract (including this contract) is in the Company's sole discretion
and that, without limiting the foregoing, acceptance of such contracts need not
be on a first-come, first-serve basis. If this contract is acceptable to the
Company, it is requested that the Company sign the form of acceptance below and
mail or deliver one of the counterparts hereof to the undersigned at its address
set forth below. This will become a binding contract between the Company and the
undersigned when such counterpart is so mailed or delivered by the Company.
Yours very truly,
By:
(Name and Title)
(Address)
Accepted, , 19
Pharmacia & Upjohn, Inc.
By:
[Title]
III-3
<PAGE> 34
EXHIBIT A
OPINION OF THE COMPANY'S SPECIAL COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 4(b)
The opinions of special counsel for the Company referred to in
Section 4(b) collectively shall be substantially to the following effect
(capitalized terms used but not defined herein shall have the meaning ascribed
to them in the Underwriting Agreement):
(i) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware.
(ii) If the Designated Securities are debt securities and/or
debt warrants, insert bracketed terms, as applicable: [The Indenture
has been duly authorized, executed and delivered by the Company and
duly qualified under the Trust Indenture Act of 1939]; [T][t]he
Designated Securities have been duly authorized, [executed,
authenticated,] issued and delivered; and the [Indenture and] [Warrant
Agreement] the Designated Securities constitute valid and legally
binding obligations of the Company enforceable in accordance with their
terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles.
[If the Designated Securities are preferred stock or common
stock, insert:] [The Designated Securities have been duly authorized
and validly issued and are fully paid and nonassessable [if the
Designated are preferred stock, insert: [, and the terms of the
Designated Securities are valid and binding on the Company].
(iii) All regulatory consents, authorizations, approvals and
filings required to be obtained or made by the Company under the
Federal laws of the United States, the laws of the State of New York
and the General Corporation Law of the State of Delaware for the
issuance, sale and delivery of the Designated Securities by the Company
have been obtained or made.
(iv) If the Designated Securities are debt warrants, insert
bracketed term: The Underwriting Agreement [, the Warrant Agreement]
and the Pricing Agreement relating to the Designated Securities have
been duly authorized, executed and delivered by the Company.
In addition, such counsel shall state that they have reviewed
the Registration Statement and the Prospectus, participated in discussions with
the Representatives and the representatives of the Company and its accountants
and that, on the basis of the information gained in such discussions, the
Registration Statement or any amendment, as of the date it became effective, and
the Prospectus, as of the date of the Prospectus, appeared on their face to be
appropriately responsive in all material respects to the requirements of the Act
and the Rules and Regulations. Further, such counsel shall confirm that nothing
-1-
<PAGE> 35
that came to their attention in the course of the aforementioned review has
caused them to believe that the Registration Statement, as of the date it became
effective, contained any untrue statement of a material fact or omitted to state
any material fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectus, as of the date of the
Prospectus and as of the Time of Delivery of the Designated Securities,
contained any untrue statement of a material fact or omitted to state any
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading.
The limitations inherent in the independent verification of
factual matters and the character of determinations involved in the registration
process are such, however, that such counsel shall not be required to assume any
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement or the Prospectus except for those made
under the caption[s] ["Description of Debt Securities We May Offer" [,
"Description of Debt Warrants We May Offer"] [Description of Preferred Stock we
may offer] [and] "Underwriting" in the Prospectus insofar as [it] [they] relate
to provisions of documents therein described. Also, such counsel need not
express any opinion or belief as to the financial statements or other financial
data contained in the Registration Statement or the Prospectus [, or as to the
statement of the eligibility and qualification of the Trustee under the
Indenture under which the Designated Securities are being offered].
-2-
<PAGE> 36
EXHIBIT B
OPINION OF THE COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 4(c)
The opinion of counsel for the Company referred to in Section
4(c) shall be substantially to the following effect (capitalized terms used but
not defined herein shall have the meaning ascribed to them in the Underwriting
Agreement):
(i) Each Principal Subsidiary of the Company that is
incorporated in the United States (a "Principal U.S. Subsidiary") has
been duly organized and is validly existing under the laws of its
jurisdiction of incorporation; each of the Company and each Principal
U.S. Subsidiary of the Company has been duly qualified as a foreign
corporation for the transaction of business and is in good standing
under the laws of each jurisdiction in which it owns or leases
properties or conducts any business so as to require such
qualification, or is subject to no material liability or disability by
reason of failure to be so qualified in any such jurisdiction; and, to
the best of such counsel's knowledge and belief after reasonable
investigation, each Principal Subsidiary of the Company that is
incorporated outside of the United States has been duly organized and
is validly existing under the laws of its jurisdiction of incorporation
(such counsel being entitled to rely in respect of the opinion in this
clause upon opinions of local counsel and in respect of matters of fact
upon certificates of officers of the Company, provided that such
counsel shall state that they believe that both you and they are
justified in relying upon such opinions and certificates);
(ii) The Company has an authorized capitalization as set forth
in the Prospectus, and all of the issued shares of capital stock of
each Principal U.S. Subsidiary of the Company have been duly and
validly authorized and issued, are fully paid and non-assessable, and
except as otherwise set forth in the Prospectus, are owned directly or
indirectly by the Company, free and clear of all liens, encumbrances,
equities or claims (such counsel being entitled to rely in respect of
the opinion in this clause upon opinions of local counsel and in
respect of matters of fact upon certificates of officers of the Company
or its subsidiaries, provided that such counsel shall state that they
believe that both you and they are justified in relying upon such
opinions and certificates) and the Securities conform to the
description of the Securities included in or incorporated by reference
in the Prospectus;
(iii) The sale and delivery of the Designated Securities under
the Pricing Agreement [and] [,] the Underwriting Agreement [and the
Warrant Agreement] and the compliance by the Company with all of the
provisions of the Pricing Agreement [and] [,] the Underwriting
Agreement [and the Warrant
-1-
<PAGE> 37
Agreement] and the consummation of the transactions contemplated
therein will not conflict with or result in a breach or violation of
any of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument known to such counsel to which the Company or any of its
Principal Subsidiaries is a party or by which the Company or any of its
Principal Subsidiaries is bound or to which any of the property or
assets of the Company or any of its subsidiaries is subject, nor will
such action result in any violation of the provisions of the
Certificate of Incorporation or Bylaws of the Company or any statute or
any order, rule or regulation known to such counsel of any court or
governmental agency or body having jurisdiction over the Company or any
of its Principal Subsidiaries or any of their properties, except for
such conflicts, breaches, violations and defaults that would not have a
material adverse effect on the consolidated financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries, taken as a whole, or that would not otherwise materially
prejudice the consummation of the transactions contemplated by this
Agreement;
(iv) To the best of such counsel's knowledge, the Company and
each of its Principal Subsidiaries have all concessions, licenses,
franchises, permits, authorizations, approvals and orders of and from
all relevant governmental regulatory officials and bodies that are
necessary to own or lease their properties and conduct their businesses
as described in the Prospectus, except where the failure to have any
such concession, license, franchise, permit, authorization, approval or
order would not have a material adverse effect on the consolidated
financial position, stockholders' equity or results of operations of
the Company and its subsidiaries, taken as a whole;
(v) To the best of such counsel's knowledge, the Company and
its Principal Subsidiaries own or have had licensed to them or
otherwise have the benefit or use under the authority of the owners
thereof of, all patents, patent rights, inventions, trademarks, service
marks, trade names and copyrights (in each case, registered or not)
which are necessary for the conduct of the business of the Company and
its subsidiaries as described in the Prospectus, except for any such
failure as would not have a material adverse effect on the financial
position, stockholders' equity or results of operations of the Company
and its subsidiaries taken as a whole, and, to the best of his
knowledge and except for the matters described in the Prospectus, there
are no unresolved assertions that the Company or any of its
subsidiaries has infringed the patents, patent rights, inventions,
trademark rights, service marks, trade names or copyrights of others,
other than assertions which, if determined adversely to the Company or
any of its subsidiaries, would not individually or in the aggregate
with respect to similar claims, have a material adverse effect on the
consolidated financial position,
-2-
<PAGE> 38
stockholders' equity or results of operations of the Company and its
subsidiaries, taken as a whole;
(vi) To the best of such counsel's knowledge and other than
the matters described in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property of the Company or any
of its subsidiaries is the subject which, if determined adversely to
the Company or any of its subsidiaries, are reasonably likely,
individually or in the aggregate with respect to similar claims, to
have a material adverse effect on the current or future consolidated
financial position, stockholders' equity or results of operations of
the Company and its subsidiaries, taken as a whole; and, to the best of
such counsel's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others; and
(vii) The documents incorporated by reference in the
Prospectus or any further amendment or supplement thereto made by the
Company prior to such Time of Delivery (other than the financial
statements and related schedules therein, as to which such counsel need
express no opinion), when they became effective or were filed with the
Commission, as the case may be, complied as to form in all material
respects with the requirements of the Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission thereunder,
and he has no reason to believe that any of such documents, when such
documents became effective or were so filed, as the case may be,
contained in the case of a registration statement which became
effective under the Act, an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, or, in the
case of other documents which were filed under the Exchange Act, an
untrue statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made when such documents were so
filed, not misleading (other than the financial statements and other
financial data as to which such counsel need express no opinion).
In rendering such opinion, such counsel may rely upon opinions
of local counsel and in respect of matters of fact upon certificates of officers
of the Company, provided that such counsel shall state that he believes both you
and he are justified in relying upon such opinions and certificates.
-3-
<PAGE> 1
EXHIBIT 4.3
INDENTURE
Dated as of __________ __, 1999
among
Pharmacia & Upjohn, Inc.,
as Issuer
and
THE BANK OF NEW YORK,
as Trustee
<PAGE> 2
CERTAIN SECTIONS OF THIS INDENTURE RELATING TO SECTIONS 310
THROUGH 318, INCLUSIVE, OF THE TRUST INDENTURE ACT OF 1939:
<TABLE>
<CAPTION>
TRUST INDENTURE
ACT SECTION INDENTURE SECTION
<S> <C>
Section 310(a)(1) ..................................... 609
(a)(2) ........................................... 609
(a)(3) ........................................... Not Applicable
(a)(4) ........................................... Not Applicable
(b) .............................................. 608
610
Section 311(a) ........................................ 613
(b) .............................................. 613
Section 312(a) ........................................ 701
702
(b) .............................................. 702
(c) .............................................. 702
Section 313(a) ........................................ 703
(b) .............................................. 703
(c) .............................................. 703
(d) .............................................. 703
Section 314(a) ........................................ 704
(a)(4) ........................................... 101
1004
(b) .............................................. Not Applicable
(c)(1) ........................................... 102
(c)(2) ........................................... 102
(c)(3) ........................................... Not Applicable
(d) .............................................. Not Applicable
(e) .............................................. 102
Section 315(a) ........................................ 601
(b) .............................................. 602
(c) .............................................. 601
(d) .............................................. 601
(e) .............................................. 514
Section 316(a) ........................................ 101
(a)(1)(A) ........................................ 502
512
(a)(1)(B) ........................................ 513
(a)(2) ........................................... Not Applicable
(b) .............................................. 508
(c) .............................................. 104
Section 317(a) (1) .................................... 503
(a)(2) ........................................... 504
(b) .............................................. 1003
Section 318(a) ........................................ 107
</TABLE>
NOTE: This reconciliation and tie shall not, for any purpose, be deemed to be
a part of the Indenture.
<PAGE> 3
TABLE OF CONTENTS
PAGE
PARTIES......................................................... 1
RECITALS OF THE COMPANY......................................... 1
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 101. Definitions....................................... 1
Act.......................................................... 2
Affiliate.................................................... 2
Attributable Debt............................................ 2
Authenticating Agent......................................... 2
Board of Directors........................................... 2
Board Resolution............................................. 2
Business Day................................................. 3
Commission................................................... 3
Company...................................................... 3
Company Request" or "Company Order........................... 3
Composite Rate............................................... 3
Consolidated Net Tangible Assets............................. 3
Corporate Trust Office....................................... 3
corporation.................................................. 3
Covenant Defeasance.......................................... 4
Defaulted Interest........................................... 4
Defeasance................................................... 4
Depositary................................................... 4
Event of Default............................................. 4
Exchange Act................................................. 4
Expiration Date.............................................. 4
Funded Debt.................................................. 4
Global Security.............................................. 4
Holder....................................................... 4
Indenture.................................................... 4
interest..................................................... 4
Interest Payment Date........................................ 4
Investment Company Act....................................... 4
Maturity..................................................... 5
Notice of Default............................................ 5
- --------------
NOTE: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture.
<PAGE> 4
PAGE
Officers' Certificate........................................ 5
Opinion of Counsel........................................... 5
Original Issue Discount Security............................. 5
Outstanding.................................................. 5
Paying Agent................................................. 6
Person....................................................... 6
Place of Payment............................................. 6
Predecessor Security......................................... 6
Principal Manufacturing Property............................. 6
Principal Subsidiary......................................... 7
Redemption Date.............................................. 7
Redemption Price............................................. 7
Regular Record Date.......................................... 7
Responsible Officer.......................................... 7
Securities................................................... 7
Securities Act............................................... 7
Security Register" and "Security Registrar................... 7
Special Record Date.......................................... 7
Stated Maturity.............................................. 7
Subsidiary................................................... 7
Trust Indenture Act.......................................... 8
Trustee...................................................... 8
U.S. Government Obligation................................... 8
Vice President............................................... 8
SECTION 102. Compliance Certificates and Opinions.............. 8
SECTION 103. Form of Documents Delivered to Trustee............ 9
SECTION 104. Acts of Holders; Record Dates..................... 9
SECTION 105. Notices, Etc., to Trustee and Company............. 11
SECTION 106. Notice to Holders; Waiver......................... 12
SECTION 107. Conflict with Trust Indenture Act................. 12
SECTION 108. Effect of Headings and Table of Contents.......... 12
SECTION 109. Successors and Assigns............................ 12
SECTION 110. Separability Clause............................... 13
SECTION 111. Benefits of Indenture............................. 13
SECTION 112. Governing Law..................................... 13
SECTION 113. Legal Holidays.................................... 13
ARTICLE TWO
SECURITY FORMS
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<PAGE> 5
PAGE
SECTION 201. Forms Generally............................................ 13
SECTION 202. Form of Face of Security................................... 14
SECTION 203. Form of Reverse of Security................................ 16
SECTION 204. Form of Legend for Global Securities....................... 20
SECTION 205. Form of Trustee's Certificate of Authentication............ 20
ARTICLE THREE
THE SECURITIES
SECTION 301. Amount Unlimited; Issuable in Series....................... 20
SECTION 302. Denominations.............................................. 23
SECTION 303. Execution, Authentication, Delivery and Dating............. 23
SECTION 304. Temporary Securities....................................... 25
SECTION 305. Registration, Registration of Transfer and Exchange........ 25
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities........... 27
SECTION 307. Payment of Interest; Interest Rights Preserved............. 28
SECTION 308. Persons Deemed Owners...................................... 29
SECTION 309. Cancellation............................................... 29
SECTION 310. Computation of Interest.................................... 29
SECTION 311. CUSIP Numbers.............................................. 29
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture.................... 30
SECTION 402. Application of Trust Money................................. 31
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default.......................................... 31
SECTION 502. Acceleration of Maturity; Rescission and Annulment......... 32
SECTION 503. Collection of Indebtedness and Suits for Enforcement by
Trustee................................................. 33
SECTION 504. Trustee May File Proofs of Claim........................... 34
SECTION 505. Trustee May Enforce Claims Without Possession of
Securities.............................................. 34
SECTION 506. Application of Money Collected............................. 35
SECTION 507. Limitation on Suits........................................ 35
SECTION 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest.................................... 36
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<PAGE> 6
PAGE
SECTION 509. Restoration of Rights and Remedies......................... 36
SECTION 510. Rights and Remedies Cumulative............................. 36
SECTION 511. Delay or Omission Not Waiver............................... 36
SECTION 512. Control by Holders......................................... 37
SECTION 513. Waiver of Past Defaults.................................... 37
SECTION 514. Undertaking for Costs...................................... 37
SECTION 515. Waiver of Usury, Stay or Extension Laws.................... 38
ARTICLE SIX
THE TRUSTEE
SECTION 601. Certain Duties and Responsibilities........................ 38
SECTION 602. Notice of Defaults......................................... 38
SECTION 603. Certain Rights of Trustee.................................. 39
SECTION 604. Not Responsible for Recitals or Issuance of
Securities.............................................. 40
SECTION 605. May Hold Securities........................................ 40
SECTION 606. Money Held in Trust........................................ 40
SECTION 607. Compensation and Reimbursement............................. 40
SECTION 608. Conflicting Interests...................................... 41
SECTION 609. Corporate Trustee Required; Eligibility.................... 41
SECTION 610. Resignation and Removal; Appointment of Successor.......... 41
SECTION 611. Acceptance of Appointment by Successor..................... 43
SECTION 612. Merger, Conversion, Consolidation or Succession to
Business................................................ 44
SECTION 613. Preferential Collection of Claims Against Company.......... 44
SECTION 614. Appointment of Authenticating Agent........................ 44
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Company to Furnish Trustee Names and Addresses of
Holders................................................. 46
SECTION 702. Preservation of Information; Communications to Holders..... 46
SECTION 703. Reports by Trustee......................................... 47
SECTION 704. Reports by Company......................................... 47
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company May Consolidate, Etc., Only on Certain Terms....... 48
-iv-
<PAGE> 7
PAGE
SECTION 802. Successor Substituted...................................... 49
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of Holders......... 49
SECTION 902. Supplemental Indentures With Consent of Holders............ 50
SECTION 903. Execution of Supplemental Indentures....................... 51
SECTION 904. Effect of Supplemental Indentures.......................... 51
SECTION 905. Conformity with Trust Indenture Act........................ 52
SECTION 906. Reference in Securities to Supplemental Indentures......... 52
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium and Interest................ 52
SECTION 1002. Maintenance of Office or Agency........................... 52
SECTION 1003. Money for Securities Payments to Be Held in Trust......... 53
SECTION 1004. Statement by Officers as to Default....................... 54
SECTION 1005. Existence................................................. 54
SECTION 1006. Maintenance of Properties................................. 54
SECTION 1007. Payment of Taxes and Other Claims......................... 55
SECTION 1008. Restrictions on Liens..................................... 55
SECTION 1009. Restrictions on Sales and Leasebacks...................... 56
SECTION 1010. Waiver of Certain Covenants............................... 56
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 1101. Applicability of Article.................................. 57
SECTION 1102. Election to Redeem; Notice to Trustee..................... 57
SECTION 1103. Selection by Trustee of Securities to Be Redeemed......... 57
SECTION 1104. Notice of Redemption...................................... 58
SECTION 1105. Deposit of Redemption Price............................... 59
SECTION 1106. Securities Payable on Redemption Date..................... 59
SECTION 1107. Securities Redeemed in Part............................... 59
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<PAGE> 8
PAGE
ARTICLE TWELVE
SINKING FUNDS
SECTION 1201. Applicability of Article.................................. 60
SECTION 1202. Satisfaction of Sinking Fund Payments with Securities..... 60
SECTION 1203. Redemption of Securities for Sinking Fund................. 60
ARTICLE THIRTEEN
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1301. Company's Option to Effect Defeasance or Covenant
Defeasance............................................ 61
SECTION 1302. Defeasance and Discharge.................................. 61
SECTION 1303. Covenant Defeasance....................................... 62
SECTION 1304. Conditions to Defeasance or Covenant Defeasance........... 62
SECTION 1305. Deposited Money and U.S. Government Obligations to Be
Held in Trust; Miscellaneous Provisions............... 64
SECTION 1306. Reinstatement............................................. 64
TESTIMONIUM.............................................................. 65
SIGNATURES............................................................... 65
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INDENTURE, dated as of __________, 1999 between Pharmacia & Upjohn, Inc.,
a corporation duly organized and existing under the laws of the State of
Delaware (herein called the "Company"), having its principal office at 95
Corporate Drive, Bridgewater, NJ 08807-1265, and The Bank of New York, a New
York banking corporation duly organized and existing under the laws of the State
of New York, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its unsecured
debentures, notes or other evidences of indebtedness (herein called the
"Securities"), to be issued in one or more series as in this Indenture provided.
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities or of series thereof, as
follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 101. Definitions.
For all purposes of this Indenture, except as otherwise expressly provided
or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(3) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles,
and, except as otherwise herein expressly provided, the term "generally
accepted accounting principles" with respect to any computation required or
permitted hereunder shall mean such
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accounting principles as are generally accepted--at the date of this
instrument--at the date of such computation;
(4) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may
be, of this Indenture; and
(5) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other sub division.
"Act", when used with respect to any Holder, has the meaning specified in
Section 104.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Attributable Debt", when used in connection with a sale and leaseback
transaction (as defined in Section 1009 hereinafter), shall mean, as of any
particular time, the lesser of (a) the fair value (as determined by the Board of
Directors) of the property subject to such arrangement and (b) the then present
value (computed by discounting at the Composite Rate) of the obligation of a
lessee for net rental payments during the remaining term of any lease in respect
of such property (including any period for which such lease has been extended or
may, at the option of the lessor, be extended). The term "net rental payments"
under any lease for any period shall mean the sum of the rental payments
required to be paid in such period by the lessee thereunder, not including,
however, any amounts required to be paid by such lessee (whether or not
designated as rental or additional rental) on account of maintenance and
repairs, insurance, taxes, assessments, water rates or similar charges required
to be paid by such lessee thereunder or any amounts required to be paid by such
lessee thereunder contingent upon the amount of sales, maintenance and repairs,
insurance, taxes, assessments, water rates or similar charges.
"Authenticating Agent" means any Person authorized by the Trustee pursuant
to Section 614 to act on behalf of the Trustee to authenticate Securities of one
or more series.
"Board of Directors" means either the board of directors of the Company or
any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by the Secretary
or an Assistant Secretary of the Company to have been duly adopted by the Board
of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
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"Business Day", when used with respect to any Place of Payment, means each
Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which
banking institutions in that Place of Payment are authorized or obligated by law
or executive order to close.
"Commission" means the Securities and Exchange Commission, from time to
time constituted, created under the Exchange Act, or, if at any time after the
execution of this instrument such Commission is not existing and performing the
duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
"Company" means the Person named as the "Company" in the first paragraph
of this instrument until a successor Person shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor Person.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its Chairman of the Board, its Vice
Chairman of the Board, its President or a Vice President, and by its Treasurer,
an Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered
to the Trustee.
"Composite Rate" means, as of any particular time, the rate of interest,
per annum, compounded semiannually, equal to the sum of the rates of interest
borne by each series of the Securities Outstanding under this Indenture (as
specified on the face of each of the Securities, provided, that in the case of
Securities with variable rates of interest, the interest rate to be used in
calculating the Composite Rate shall be the interest rate applicable to such
Securities at the beginning of the most recent period for which the interest
rate was determined for such Securities in accordance with the terms thereof and
provided, further, that, in the case of Securities which do not bear interest,
the interest rate to be used in calculating the Composite Rate shall be a rate
equal to the yield to Maturity on such Securities, calculated at the time of
issuance of such Securities) multiplied, in the case of each of the Securities,
by the percentage of the aggregate principal amount of all of the Securities
then Outstanding represented by such Security.
"Consolidated Net Tangible Assets" means the aggregate amount of assets
(less applicable reserves and other properly deductible items) after deducting
therefrom (a) all current liabilities (excluding any thereof constituting Funded
Debt by reason of being renewable or extendible) and (b) all goodwill, trade
names, trademarks, patents, unamortized debt discount and expense and other like
intangibles, all as set forth on the most recent balance sheet of the Company
and its consolidated subsidiaries and computed in accordance with generally
accepted accounting principles.
"Corporate Trust Office" means the principal office of the Trustee in The
City of New York, at which at any particular time its corporate trust business
shall be administered.
"corporation" means a corporation, association, company, joint-stock
company or business trust.
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"Covenant Defeasance" has the meaning specified in Section 1303.
"Defaulted Interest" has the meaning specified in Section 307.
"Defeasance" has the meaning specified in Section 1302.
"Depositary" means, with respect to Securities of any series issuable in
whole or in part in the form of one or more Global Securities, a clearing agency
registered under the Exchange Act that is designated to act as Depositary for
such Securities as contemplated by Section 301.
"Event of Default" has the meaning specified in Section 501.
"Exchange Act" means the Securities Exchange Act of 1934 and any statute
successor thereto, in each case as amended from time to time.
"Expiration Date" has the meaning specified in Section 104.
"Funded Debt" means all indebtedness for money borrowed having a maturity
of 12 months or more from the date as of which the amount thereof is to be
determined or having a maturity of less than 12 months but by its terms being
renewable or extendible beyond 12 months from such date at the option of the
borrower.
"Global Security" means a Security that evidences all or part of the
Securities of any series and bears the legend set forth in Section 204 (or such
legend as may be specified as contemplated by Section 301 for such Securities).
"Holder" means a Person in whose name a Security is registered in the
Security Register.
"Indenture" means this instrument as originally executed and as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively. The term "Indenture" shall also include the terms of particular
series of Securities established as contemplated by Section 301.
"interest", when used with respect to an Original Issue Discount Security
which by its terms bears interest only after Maturity, means interest payable
after Maturity.
"Interest Payment Date", when used with respect to any Security, means the
Stated Maturity of an instalment of interest on such Security.
"Investment Company Act" means the Investment Company Act of 1940 and any
statute successor thereto, in each case as amended from time to time.
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"Maturity", when used with respect to any Security, means the date on
which the principal of such Security or an instalment of principal becomes due
and payable as therein or herein provided, whether at the Stated Maturity or by
declaration of acceleration, call for redemption or otherwise.
"Notice of Default" means a written notice of the kind specified in
Section 501(4) or 501(5).
"Officers' Certificate" means a certificate signed by the Chairman of the
Board, a Vice Chairman of the Board, the President or a Vice President, and by
the Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary,
of the Company, and delivered to the Trustee. One of the officers signing an
Officers' Certificate given pursuant to Section 1004 shall be the principal
executive, financial or accounting officer of the Company.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company, and who shall be acceptable to the Trustee.
"Original Issue Discount Security" means any Security which provides for
an amount less than the principal amount thereof to be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to Section 502.
"Outstanding", when used with respect to Securities, means, as of the date
of determination, all Securities theretofore authenticated and delivered under
this Indenture, except:
(1) Securities theretofore cancelled by the Trustee or delivered to the
Trustee for cancellation;
(2) Securities for whose payment or redemption money in the necessary
amount has been theretofore deposited with the Trustee or any Paying Agent
(other than the Company) in trust or set aside and segregated in trust by the
Company (if the Company shall act as its own Paying Agent) for the Holders of
such Securities; provided that, if such Securities are to be redeemed, notice
of such redemption has been duly given pursuant to this Indenture or
provision therefor satisfactory to the Trustee has been made;
(3) Securities as to which Defeasance has been effected pursuant to
Section 1302; and
(4) Securities which have been paid pursuant to Section 306 or in
exchange for or in lieu of which other Securities have been authenticated and
delivered pursuant to this Indenture, other than any such Securities in
respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Securities are held by a bona fide purchaser in
whose hands such Securities are valid obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given, made or taken any
request, demand,
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authorization, direction, notice, consent, waiver or other action hereunder as
of any date, (A) the principal amount of an Original Issue Discount Security
which shall be deemed to be Outstanding shall be the amount of the principal
thereof which would be due and payable as of such date upon acceleration of the
Maturity thereof to such date pursuant to Section 502, (B) if, as of such date,
the principal amount payable at the Stated Maturity of a Security is not
determinable, the principal amount of such Security which shall be deemed to be
Outstanding shall be the amount as specified or determined as contemplated by
Section 301, (C) the principal amount of a Security denominated in one or more
foreign currencies or currency units which shall be deemed to be Outstanding
shall be the U.S. dollar equivalent, determined as of such date in the manner
provided as contemplated by Section 301, of the principal amount of such
Security (or, in the case of a Security described in Clause (A) or (B) above, of
the amount determined as provided in such Clause), and (D) Securities owned by
the Company or any other obligor upon the Securities or any Affiliate of the
Company or of such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in relying upon any such request, demand, authorization, direction, notice,
consent, waiver or other action, only Securities which the Trustee knows to be
so owned shall be so disregarded. Securities so owned which have been pledged in
good faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right so to act with respect to such
Securities and that the pledgee is not the Company or any other obligor upon the
Securities or any Affiliate of the Company or of such other obligor.
"Paying Agent" means any Person authorized by the Company to pay the
principal of or any premium or interest on any Securities on behalf of the
Company.
"Person" means any individual, corporation, partnership, joint venture,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
"Place of Payment", when used with respect to the Securities of any
series, means the place or places where the principal of and any premium and
interest on the Securities of that series are payable as specified as
contemplated by Section 301.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 306 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Security.
"Principal Manufacturing Property" means any building, structure or other
facility, together with the land upon which it is erected and fixtures
comprising a part thereof, used primarily for manufacturing or processing, owned
or leased by the Company or any Principal Subsidiary, other than any such
building, structure or other facility or portion thereof which, in the opinion
of the Board of Directors, is not of material importance to the total business
conducted by the Company and its Subsidiaries as an entirety.
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"Principal Subsidiary" means Pharmacia & Upjohn Company, Pharmacia &
Upjohn AB, Pharmacia S.p.A. and Pharmacia & Upjohn Caribe Inc.
"Redemption Date", when used with respect to any Security to be redeemed,
means the date fixed for such redemption by or pursuant to this Indenture.
"Redemption Price", when used with respect to any Security to be redeemed,
means the price at which it is to be redeemed pursuant to this Indenture.
"Regular Record Date" for the interest payable on any Interest Payment
Date on the Securities of any series means the date specified for that purpose
as contemplated by Section 301.
"Responsible Officer", when used with respect to the Trustee, means any
officer within the corporate trust department of the Trustee, including any vice
president, any assistant secretary, any assistant treasurer, any trust officer
or assistant trust officer, or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.
"Securities" has the meaning stated in the first recital of this Indenture
and more particularly means any Securities authenticated and delivered under
this Indenture.
"Securities Act" means the Securities Act of 1933 and any statute
successor thereto, in each case as amended from time to time.
"Security Register" and "Security Registrar" have the respective meanings
specified in Section 305.
"Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 307.
"Stated Maturity", when used with respect to any Security or any
instalment of principal thereof or interest thereon, means the date specified in
such Security as the fixed date on which the principal of such Security or such
instalment of principal or interest is due and payable.
"Subsidiary" means a corporation more than 50% of the outstanding voting
stock of which is owned, directly or indirectly, by the Company or by one or
more Subsidiaries, or by the Company and one or more other Subsidiaries. For the
purposes of this definition, "voting stock" means stock which ordinarily has
voting power for the election of directors,
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whether at all times or only so long as no senior class of stock has such voting
power by reason of any contingency.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force at
the date as of which this instrument was executed; provided, however, that in
the event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Trustee" means the Person named as the "Trustee" in the first paragraph
of this instrument until a successor Trustee shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter "Trustee" shall mean
or include each Person who is then a Trustee hereunder, and if at any time there
is more than one such Person, "Trustee" as used with respect to the Securities
of any series shall mean the Trustee with respect to Securities of that series.
"U.S. Government Obligation" has the meaning specified in Section 1304.
"Vice President", when used with respect to the Company or the Trustee,
means any vice president, whether or not designated by a number or a word or
words added before or after the title "vice president".
SECTION 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee to take any
action under any provision of this Indenture, the Company shall furnish to the
Trustee such certificates and opinions as may be required under the Trust
Indenture Act. Each such certificate or opinion shall be given in the form of an
Officers' Certificate, if to be given by an officer of the Company, or an
Opinion of Counsel, if to be given by counsel, and shall comply with the
requirements of the Trust Indenture Act and any other requirements set forth in
this Indenture.
Every certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture (except for certificates provided for
in Section 1004) shall include,
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
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(4) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
SECTION 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
SECTION 104. Acts of Holders; Record Dates.
Any request, demand, authorization, direction, notice, consent, waiver or
other action provided or permitted by this Indenture to be given, made or taken
by Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 601) conclusive in favor of the Trustee and
the Company, if made in the manner provided in this Section.
The fact and date of the execution by any Person of any such instrument or
writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary
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public or other officer authorized by law to take acknowledgments of deeds,
certifying that the individual signing such instrument or writing acknowledged
to him the execution thereof. Where such execution is by a signer acting in a
capacity other than his individual capacity, such certificate or affidavit shall
also constitute sufficient proof of his authority. The fact and date of the
execution of any such instrument or writing, or the authority of the Person
executing the same, may also be proved in any other manner which the Trustee
deems sufficient.
The ownership of Securities shall be proved by the Security Register.
Any request, demand, authorization, direction, notice, consent, waiver or
other Act of the Holder of any Security shall bind every future Holder of the
same Security and the Holder of every Security issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or suffered to be done by the Trustee or the Company in
reliance thereon, whether or not notation of such action is made upon such
Security.
The Company may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to
give, make or take any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Indenture to be
given, made or taken by Holders of Securities of such series, provided that the
Company may not set a record date for, and the provisions of this paragraph
shall not apply with respect to, the giving or making of any notice,
declaration, request or direction referred to in the next paragraph. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of the relevant series on such record date, and no other Holders,
shall be entitled to take the relevant action, whether or not such Holders
remain Holders after such record date; provided that no such action shall be
effective hereunder unless taken on or prior to the applicable Expiration Date
by Holders of the requisite principal amount of Outstanding Securities of such
series on such record date. Nothing in this paragraph shall be construed to
prevent the Company from setting a new record date for any action for which a
record date has previously been set pursuant to this paragraph (whereupon the
record date previously set shall automatically and with no action by any Person
be cancelled and of no effect), and nothing in this paragraph shall be construed
to render ineffective any action taken by Holders of the requisite principal
amount of Outstanding Securities of the relevant series on the date such action
is taken. Promptly after any record date is set pursuant to this paragraph, the
Company, at its own expense, shall cause notice of such record date, the
proposed action by Holders and the applicable Expiration Date to be given to the
Trustee in writing and to each Holder of Securities of the relevant series in
the manner set forth in Section 106.
The Trustee may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to join
in the giving or making of (i) any Notice of Default, (ii) any declaration of
acceleration referred to in Section 502, (iii) any request to institute
proceedings referred to in Section 507(2) or (iv) any direction referred to in
Section 512, in each case with respect to Securities of such series. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of such series on such
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record date, and no other Holders, shall be entitled to join in such notice,
declaration, request or direction, whether or not such Holders remain Holders
after such record date; provided that no such action shall be effective
hereunder unless taken on or prior to the applicable Expiration Date by Holders
of the requisite principal amount of Outstanding Securities of such series on
such record date. Nothing in this paragraph shall be construed to prevent the
Trustee from setting a new record date for any action for which a record date
has previously been set pursuant to this paragraph (whereupon the record date
previously set shall automatically and with no action by any Person be cancelled
and of no effect), and nothing in this paragraph shall be construed to render
ineffective any action taken by Holders of the requisite principal amount of
Outstanding Securities of the relevant series on the date such action is taken.
Promptly after any record date is set pursuant to this paragraph, the Trustee,
at the Company's expense, shall cause notice of such record date, the proposed
action by Holders and the applicable Expiration Date to be given to the Company
in writing and to each Holder of Securities of the relevant series in the manner
set forth in Section 106.
With respect to any record date set pursuant to this Section, the party
hereto which sets such record dates may designate any day as the "Expiration
Date" and from time to time may change the Expiration Date to any earlier or
later day; provided that no such change shall be effective unless notice of the
proposed new Expiration Date is given to the other party hereto in writing, and
to each Holder of Securities of the relevant series in the manner set forth in
Section 106, on or prior to the existing Expiration Date. If an Expiration Date
is not designated with respect to any record date set pursuant to this Section,
the party hereto which set such record date shall be deemed to have initially
designated the 180th day after such record date as the Expiration Date with
respect thereto, subject to its right to change the Expiration Date as provided
in this paragraph. Notwithstanding the foregoing, no Expiration Date shall be
later than the 180th day after the applicable record date.
Without limiting the foregoing, a Holder entitled hereunder to take any
action hereunder with regard to any particular Security may do so with regard to
all or any part of the principal amount of such Security or by one or more duly
appointed agents each of which may do so pursuant to such appointment with
regard to all or any part of such principal amount.
SECTION 105. Notices, Etc., to Trustee and Company.
Any request, demand, authorization, direction, notice, consent, waiver or
Act of Holders or other document provided or permitted by this Indenture to be
made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be sufficient for
every purpose hereunder if made, given, furnished or filed in writing to or
with the Trustee at its Corporate Trust Office, Attention: Corporate Trust
Administration, or
(2) the Company by the Trustee or by any Holder shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided) if in
writing and mailed, first-class postage prepaid, to the Company addressed to
it at the address of its principal
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office specified in the first paragraph of this instrument or at any other
address previously furnished in writing to the Trustee by the Company.
SECTION 106. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at his address as it appears in the Security Register, not later
than the latest date (if any), and not earlier than the earliest date (if any),
prescribed for the giving of such notice. In any case where notice to Holders is
given by mail, neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Holder shall affect the sufficiency of such
notice with respect to other Holders. Where this Indenture provides for notice
in any manner, such notice may be waived in writing by the Person entitled to
receive such notice, either before or after the event, and such waiver shall be
the equivalent of such notice. Waivers of notice by Holders shall be filed with
the Trustee, but such filing shall not be a condition precedent to the validity
of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by reason
of any other cause it shall be impracticable to give such notice by mail, then
such notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.
SECTION 107. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with a provision of
the Trust Indenture Act which is required under such Act to be a part of and
govern this Indenture, the latter provision shall control. If any provision of
this Indenture modifies or excludes any provision of the Trust Indenture Act
which may be so modified or excluded, the latter provision shall be deemed to
apply to this Indenture as so modified or to be excluded, as the case may be.
SECTION 108. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
SECTION 109. Successors and Assigns.
All covenants and agreements in this Indenture by the Company shall bind
its successors and assigns, whether so expressed or not.
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<PAGE> 21
SECTION 110. Separability Clause.
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
SECTION 111. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied, shall
give to any Person, other than the parties hereto and their successors hereunder
and the Holders, any benefit or any legal or equitable right, remedy or claim
under this Indenture.
SECTION 112. Governing Law.
This Indenture and the Securities shall be governed by and construed in
accordance with the law of the State of New York.
SECTION 113. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security shall not be a Business Day at any Place of Payment,
then (notwithstanding any other provision of this Indenture or of the Securities
(other than a provision of any Security which specifically states that such
provision shall apply in lieu of this Section)) payment of interest or principal
(and premium, if any) need not be made at such Place of Payment on such date,
but may be made on the next succeeding Business Day at such Place of Payment
with the same force and effect as if made on the Interest Payment Date or
Redemption Date, or at the Stated Maturity.
ARTICLE TWO
SECURITY FORMS
SECTION 201. Forms Generally.
The Securities of each series shall be in substantially the form set forth
in this Article, or in such other form as shall be established by or pursuant to
a Board Resolution or in one or more indentures supplemental hereto, in each
case with such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Indenture, and may have such
letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or Depositary therefor or as may, consistently herewith, be
determined by the
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<PAGE> 22
officers executing such Securities, as evidenced by their execution thereof. If
the form of Securities of any series is established by action taken pursuant to
a Board Resolution, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Company Order
contemplated by Section 303 for the authentication and delivery of such
Securities.
The definitive Securities shall be printed, lithographed or engraved on
steel engraved borders or may be produced in any other manner, all as determined
by the officers executing such Securities, as evidenced by their execution of
such Securities.
SECTION 202. Form of Face of Security.
[Insert any legend required by the Internal Revenue Code and the
regulations thereunder.]
..........................................................
..........................................................................
No. ......... $ ........
CUSIP No.
Pharmacia & Upjohn, Inc., a corporation duly organized and existing under
the laws of Delaware (herein called the "Company", which term includes any
successor Person under the Indenture hereinafter referred to), for value
received, hereby promises to pay to ..........................., or registered
assigns, the principal sum of .................... Dollars on
........................... [if the Security is to bear interest prior to
Maturity, insert -- , and to pay interest thereon from ............. or from the
most recent Interest Payment Date to which interest has been paid or duly
provided for, semi-annually on ............ and ............ in each year,
commencing ........., at the rate of ....% per annum, until the principal hereof
is paid or made available for payment [if applicable, insert -- , provided that
any principal and premium, and any such instalment of interest, which is overdue
shall bear interest at the rate of ...% per annum (to the extent that the
payment of such interest shall be legally enforceable), from the dates such
amounts are due until they are paid or made available for payment, and such
interest shall be payable on demand]. The interest so payable, and punctually
paid or duly provided for, on any Interest Payment Date will, as provided in
such Indenture, be paid to the Person in whose name this Security (or one or
more Predecessor Securities) is registered at the close of business on the
Regular Record Date for such interest, which shall be the ....... or .......
(whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date. Any such interest not so punctually paid or duly provided
for will forthwith cease to be payable to the Holder on such Regular Record Date
and may either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities of this series
not less than 10 days prior to such Special Record Date,
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<PAGE> 23
or be paid at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Securities of this series
may be listed, and upon such notice as may be required by such exchange, all as
more fully provided in said Indenture.
[If the Security is not to bear interest prior to Maturity, insert -- The
principal of this Security shall not bear interest except in the case of a
default in payment of principal upon acceleration, upon redemption or at Stated
Maturity and in such case the overdue principal and any overdue premium shall
bear interest at the rate of ....% per annum (to the extent that the payment of
such interest shall be legally enforceable), from the dates such amounts are due
until they are paid or made available for payment. Interest on any overdue
principal or premium shall be payable on demand. [Any such interest on overdue
principal or premium which is not paid on demand shall bear interest at the rate
of ......% per annum (to the extent that the payment of such interest on
interest shall be legally enforceable), from the date of such demand until the
amount so demanded is paid or made available for payment. Interest on any
overdue interest shall be payable on demand.]]
Payment of the principal of (and premium, if any) and [if applicable,
insert -- any such] interest on this Security will be made at the office or
agency of the Company maintained for that purpose in ............, in such coin
or currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts [if applicable, insert -- ;
provided, however, that at the option of the Company payment of interest may be
made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register].
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated:
.....................................................
By...................................................
Attest:
.........................................
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<PAGE> 24
SECTION 203. Form of Reverse of Security.
This Security is one of a duly authorized issue of securities of the
Company (herein called the "Securities"), issued and to be issued in one or more
series under an Indenture, dated as of ........................ (herein called
the "Indenture", which term shall have the meaning assigned to it in such
instrument), between the Company and [......................], as Trustee
(herein called the "Trustee", which term includes any successor trustee under
the Indenture), and reference is hereby made to the Indenture for a statement of
the respective rights, limitations of rights, duties and immunities thereunder
of the Company, the Trustee[, the holders of Senior Debt] and the Holders of the
Securities and of the terms upon which the Securities are, and are to be,
authenticated and delivered. This Security is one of the series designated on
the face hereof [if applicable, insert -- , limited in aggregate principal
amount to $..............].
[If applicable, insert -- The Securities of this series are subject to
redemption upon not less than 30 days' notice by mail, [if applicable, insert --
(1) on ........... in any year commencing with the year ...... and ending with
the year ...... through operation of the sinking fund for this series at a
Redemption Price equal to 100% of the principal amount, and (2)] at any time [if
applicable, insert -- on or after .........., 19..], as a whole or in part, at
the election of the Company, at the following Redemption Prices (expressed as
percentages of the principal amount): If redeemed [if applicable, insert -- on
or before ..............., ...%, and if redeemed] during the 12-month period
beginning ............. of the years indicated,
<TABLE>
<CAPTION>
Redemption Redemption
Year Price Year Price
- ---- ---------- ---- ----------
<S> <C> <C> <C>
</TABLE>
and thereafter at a Redemption Price equal to .....% of the principal amount,
together in the case of any such redemption [if applicable, insert -- (whether
through operation of the sinking fund or otherwise)] with accrued interest to
the Redemption Date, but interest instalments whose Stated Maturity is on or
prior to such Redemption Date will be payable to the Holders of such Securities,
or one or more Predecessor Securities, of record at the close of business on the
relevant Record Dates referred to on the face hereof, all as provided in the
Indenture.]
[If applicable, insert -- The Securities of this series are subject to
redemption upon not less than 30 days' notice by mail, (1) on ............ in
any year commencing with the year ....
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<PAGE> 25
and ending with the year .... through operation of the sinking fund for this
series at the Redemption Prices for redemption through operation of the sinking
fund (expressed as percentages of the principal amount) set forth in the table
below, and (2) at any time [if applicable, insert -- on or after ............],
as a whole or in part, at the election of the Company, at the Redemption Prices
for redemption otherwise than through operation of the sinking fund (expressed
as percentages of the principal amount) set forth in the table below: If
redeemed during the 12-month period beginning ............ of the years
indicated,
<TABLE>
<CAPTION>
Redemption Price
For Redemption Redemption Price For
Through Operation Redemption Otherwise
of the Than Through Operation
Year Sinking Fund of the Sinking Fund
- ---- ----------------- ----------------------
<S> <C> <C>
</TABLE>
and thereafter at a Redemption Price equal to .....% of the principal amount,
together in the case of any such redemption (whether through operation of the
sinking fund or otherwise) with accrued interest to the Redemption Date, but
interest instalments whose Stated Maturity is on or prior to such Redemption
Date will be payable to the Holders of such Securities, or one or more
Predecessor Securities, of record at the close of business on the relevant
Record Dates referred to on the face hereof, all as provided in the Indenture.]
[If applicable, insert -- Notwithstanding the foregoing, the Company may
not, prior to ............., redeem any Securities of this series as
contemplated by [if applicable, insert -- Clause (2) of] the preceding paragraph
as a part of, or in anticipation of, any refunding operation by the application,
directly or indirectly, of moneys borrowed having an interest cost to the
Company (calculated in accordance with generally accepted financial practice) of
less than .....% per annum.]
[If applicable, insert -- The sinking fund for this series provides for
the redemption on ............ in each year beginning with the year ....... and
ending with the year ...... of [if applicable, insert -- not less than
$.......... ("mandatory sinking fund") and not more than] $......... aggregate
principal amount of Securities of this series. Securities of this series
acquired or redeemed by the Company otherwise than through [if applicable,
insert -- mandatory] sinking fund payments may be credited against subsequent
[if applicable, insert -- mandatory] sinking fund payments otherwise required to
be made [if applicable, insert -- , in the inverse order in which they become
due].]
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<PAGE> 26
[If the Security is subject to redemption of any kind, insert -- In the
event of redemption of this Security in part only, a new Security or Securities
of this series and of like tenor for the unredeemed portion hereof will be
issued in the name of the Holder hereof upon the cancellation hereof.]
[If applicable, insert paragraph regarding subordination of the Security.]
[If applicable, insert -- The Indenture contains provisions for defeasance
at any time of [the entire indebtedness of this Security] [or] [certain
restrictive covenants and Events of Default with respect to this Security] [, in
each case] upon compliance with certain conditions set forth in the Indenture.]
[If the Security is not an Original Issue Discount Security, insert -- If
an Event of Default with respect to Securities of this series shall occur and be
continuing, the principal of the Securities of this series may be declared due
and payable in the manner and with the effect provided in the Indenture.]
[If the Security is an Original Issue Discount Security, insert -- If an
Event of Default with respect to Securities of this series shall occur and be
continuing, an amount of principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture. Such amount shall be equal to -- insert formula for determining the
amount. Upon payment (i) of the amount of principal so declared due and payable
and (ii) of interest on any overdue principal, premium and interest (in each
case to the extent that the payment of such interest shall be legally
enforceable), all of the Company's obligations in respect of the payment of the
principal of and premium and interest, if any, on the Securities of this series
shall terminate.]
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of a majority in principal amount of the Securities at
the time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Securities of each series at the time Outstanding, on behalf of the
Holders of all Securities of such series, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.
As provided in and subject to the provisions of the Indenture, the Holder
of this Security shall not have the right to institute any proceeding with
respect to the Indenture or for the appointment of a receiver or trustee or for
any other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than 25% in principal amount
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<PAGE> 27
of the Securities of this series at the time Outstanding shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee and offered the Trustee reasonable indemnity satisfactory to
it, and the Trustee shall not have received from the Holders of a majority in
principal amount of Securities of this series at the time Outstanding a
direction inconsistent with such request, and shall have failed to institute any
such proceeding, for 60 days after receipt of such notice, request and offer of
indemnity. The foregoing shall not apply to any suit instituted by the Holder of
this Security for the enforcement of any payment of principal hereof or any
premium or interest hereon on or after the respective due dates expressed
herein.
No reference herein to the Indenture and no provision of this Security or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and any premium and interest
on this Security at the times, place and rate, and in the coin or currency,
herein prescribed.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in any place where the principal of and any
premium and interest on this Security are payable, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Securities of
this series and of like tenor, of authorized denominations and for the same
aggregate principal amount, will be issued to the designated transferee or
transferees.
The Securities of this series are issuable only in registered form without
coupons in denominations of $................. and any integral multiple
thereof. As provided in the Indenture and subject to certain limitations therein
set forth, Securities of this series are exchangeable for a like aggregate
principal amount of Securities of this series and of like tenor of a different
authorized denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name this Security is registered as the owner hereof for all
purposes, whether or not this Security be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
All terms used in this Security which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
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<PAGE> 28
SECTION 204. Form of Legend for Global Securities.
Unless otherwise specified as contemplated by Section 301 for the
Securities evidenced thereby, every Global Security authenticated and delivered
hereunder shall bear a legend in substantially the following form:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE THEREOF. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A
SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE
REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE
THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
SECTION 205. Form of Trustee's Certificate of Authentication.
The Trustee's certificates of authentication shall be in substantially the
following form:
This is one of the Securities of the series designated therein referred to
in the within-mentioned Indenture.
Dated: THE BANK OF NEW YORK,
as Trustee
By.........................................
Authorized Signatory
ARTICLE THREE
THE SECURITIES
SECTION 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be authenticated
and delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. There shall be
established in or pursuant to a Board Resolution and, subject to Section 303,
set forth, or determined in the manner provided, in an Officers' Certificate, or
established in one or more indentures supplemental hereto, prior to the issuance
of Securities of any series,
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<PAGE> 29
(1) the title of the Securities of the series (which shall distinguish
the Securities of the series from Securities of any other series);
(2) any limit upon the aggregate principal amount of the Securities of
the series which may be authenticated and delivered under this Indenture
(except for Securities authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other Securities of the
series pursuant to Section 304, 305, 306, 906 or 1107 and except for any
Securities which, pursuant to Section 303, are deemed never to have been
authenticated and delivered hereunder) (including any provision for the
offering of additional Securities of the series beyond any such limit upon
the aggregate principal amount of Securities of such series);
(3) the Person to whom any interest on a Security of the series shall be
payable, if other than the Person in whose name that Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest;
(4) the date or dates on which the principal of any Securities of the
series is payable;
(5) the rate or rates at which any Securities of the series shall bear
interest, if any, the date or dates from which any such interest shall
accrue, the Interest Payment Dates on which any such interest shall be
payable and the Regular Record Date for any such interest payable on any
Interest Payment Date;
(6) the place or places where the principal of and any premium and
interest on any Securities of the series shall be payable;
(7) the period or periods within which, the price or prices at which and
the terms and conditions upon which any Securities of the series may be
redeemed, in whole or in part, at the option of the Company and, if other
than by a Board Resolution, the manner in which any election by the Company
to redeem the Securities shall be evidenced;
(8) the obligation, if any, of the Company to redeem or purchase any
Securities of the series pursuant to any sinking fund or analogous provisions
or at the option of the Holder thereof and the period or periods within
which, the price or prices at which and the terms and conditions upon which
any Securities of the series shall be redeemed or purchased, in whole or in
part, pursuant to such obligation;
(9) if other than denominations of $1,000 and any integral multiple
thereof, the denominations in which any Securities of the series shall be
issuable;
(10) if the amount of principal of or any premium or interest on any
Securities of the series may be determined with reference to an index or
pursuant to a formula, the manner in which such amounts shall be determined;
(11) if other than the currency of the United States of America, the
currency, currencies or currency units in which the principal of or any
premium or interest on any Securities
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<PAGE> 30
of the series shall be payable and the manner of determining the equivalent
thereof in the currency of the United States of America for any purpose,
including for purposes of the definition of "Outstanding" in Section 101;
(12) if the principal of or any premium or interest on any Securities of
the series is to be payable, at the election of the Company or the Holder
thereof, in one or more currencies or currency units other than that or those
in which such Securities are stated to be payable, the currency, currencies
or currency units in which the principal of or any premium or interest on
such Securities as to which such election is made shall be payable, the
periods within which and the terms and conditions upon which such election is
to be made and the amount so payable (or the manner in which such amount
shall be determined);
(13) if other than the entire principal amount thereof, the portion of the
principal amount of any Securities of the series which shall be payable upon
declaration of acceleration of the Maturity thereof pursuant to Section 502;
(14) if the principal amount payable at the Stated Maturity of any
Securities of the series will not be determinable as of any one or more dates
prior to the Stated Maturity, the amount which shall be deemed to be the
principal amount of such Securities as of any such date for any purpose
thereunder or hereunder, including the principal amount thereof which shall
be due and payable upon any Maturity other than the Stated Maturity or which
shall be deemed to be Outstanding as of any date prior to the Stated Maturity
(or, in any such case, the manner in which such amount deemed to be the
principal amount shall be determined);
(15) if applicable, that the Securities of the series, in whole or any
specified part, shall be defeasible pursuant to Section 1302 or Section 1303
or both such Sections and, if other than by a Board Resolution, the manner in
which any election by the Company to defease such Securities shall be
evidenced;
(16) if applicable, that any Securities of the series shall be issuable in
whole or in part in the form of one or more Global Securities and, in such
case, the respective Depositaries for such Global Securities, the form of any
legend or legends which shall be borne by any such Global Security in
addition to or in lieu of that set forth in Section 204 and any circumstances
in addition to or in lieu of those set forth in Clause (2) of the last
paragraph of Section 305 in which any such Global Security may be exchanged
in whole or in part for Securities registered, and any transfer of such
Global Security in whole or in part may be registered, in the name or names
of Persons other than the Depositary for such Global Security or a nominee
thereof;
(17) any addition to or change in the Events of Default which applies to
any Securities of the series and any change in the right of the Trustee or
the requisite Holders of such Securities to declare the principal amount
thereof due and payable pursuant to Section 502;
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<PAGE> 31
(18) any addition to or change in the covenants set forth in Article Ten
which applies to Securities of the series; and
(19) any other terms of the series (which terms shall not be inconsistent
with the provisions of this Indenture, except as permitted by Section
901(5)).
All Securities of any one series shall be substantially identical except
as to denomination and except as may otherwise be provided in or pursuant to the
Board Resolution referred to above and (subject to Section 303) set forth, or
determined in the manner provided, in the Officers' Certificate referred to
above or in any such indenture supplemental hereto.
If any of the terms of the series are established by action taken pursuant
to a Board Resolution, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.
SECTION 302. Denominations.
The Securities of each series shall be issuable only in registered form
without coupons and only in such denominations as shall be specified as
contemplated by Section 301. In the absence of any such specified denomination
with respect to the Securities of any series, the Securities of such series
shall be issuable in denominations of $1,000 and any integral multiple thereof.
SECTION 303. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by its Chairman
of the Board, its Vice Chairman of the Board, its President or one of its Vice
Presidents, under its corporate seal or a facsimile thereof reproduced thereon
attested by its Secretary or one of its Assistant Secretaries. The signature of
any of these officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals who
were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Securities of any series executed by the
Company to the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities, and the Trustee in accordance
with the Company Order shall authenticate and deliver such Securities. If the
form or terms of the Securities of the series have been established by or
pursuant to one or more Board Resolutions as permitted by Sections 201 and 301,
in authenticating such Securities, and accepting the additional responsibilities
under this
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<PAGE> 32
Indenture in relation to such Securities, the Trustee shall be entitled to
receive, and (subject to Section 601) shall be fully protected in relying upon,
an Opinion of Counsel stating,
(1) if the form of such Securities has been established by or pursuant to
Board Resolution as permitted by Section 201, that such form has been
established in conformity with the provisions of this Indenture;
(2) if the terms of such Securities have been established by or pursuant
to Board Resolution as permitted by Section 301, that such terms have been
established in conformity with the provisions of this Indenture; and
(3) that such Securities, when authenticated and delivered by the Trustee
and issued by the Company in the manner and subject to any conditions
specified in such Opinion of Counsel, will constitute valid and legally
binding obligations of the Company enforceable in accordance with their
terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating
to or affecting creditors' rights and to general equity principles.
If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties or
immunities under the Securities and this Indenture or otherwise in a manner
which is not reasonably acceptable to the Trustee.
Notwithstanding the provisions of Section 301 and of the preceding
paragraph, if all Securities of a series are not to be originally issued at one
time, it shall not be necessary to deliver the Officers' Certificate otherwise
required pursuant to Section 301 or the Company Order and Opinion of Counsel
otherwise required pursuant to such preceding paragraph at or prior to the
authentication of each Security of such series if such documents are delivered
at or prior to the authentication upon original issuance of the first Security
of such series to be issued.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any
Security shall be conclusive evidence, and the only evidence, that such Security
has been duly authenticated and delivered hereunder. Notwithstanding the
foregoing, if any Security shall have been authenticated and delivered hereunder
but never issued and sold by the Company, and the Company shall deliver such
Security to the Trustee for cancellation as provided in Section 309, for all
purposes of this Indenture such Security shall be deemed never to have been
authenticated and delivered hereunder and shall never be entitled to the
benefits of this Indenture.
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<PAGE> 33
SECTION 304. Temporary Securities.
Pending the preparation of definitive Securities of any series, the
Company may execute, and upon Company Order the Trustee shall authenticate and
deliver, temporary Securities which are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities in lieu of which they
are issued and with such appropriate insertions, omissions, substitutions and
other variations as the officers executing such Securities may determine, as
evidenced by their execution of such Securities.
If temporary Securities of any series are issued, the Company will cause
definitive Securities of that series to be prepared without unreasonable delay.
After the preparation of definitive Securities of such series, the temporary
Securities of such series shall be exchangeable for definitive Securities of
such series upon surrender of the temporary Securities of such series at the
office or agency of the Company in a Place of Payment for that series, without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Securities of any series, the Company shall execute and the Trustee
shall authenticate and deliver in exchange therefor one or more definitive
Securities of the same series, of any authorized denominations and of like tenor
and aggregate principal amount. Until so exchanged, the temporary Securities of
any series shall in all respects be entitled to the same benefits under this
Indenture as definitive Securities of such series and tenor.
SECTION 305. Registration, Registration of Transfer and Exchange.
The Company shall cause to be kept at the Corporate Trust Office of the
Trustee a register (the register maintained in such office and in any other
office or agency of the Company in a Place of Payment being herein sometimes
collectively referred to as the "Security Register") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the
registration of Securities and of transfers of Securities. The Trustee is hereby
appointed "Security Registrar" for the purpose of registering Securities and
transfers of Securities as herein provided.
Upon surrender for registration of transfer of any Security of a series at
the office or agency of the Company in a Place of Payment for that series, the
Company shall execute, and the Trustee shall authenticate and deliver, in the
name of the designated transferee or transferees, one or more new Securities of
the same series, of any authorized denominations and of like tenor and aggregate
principal amount.
At the option of the Holder, Securities of any series may be exchanged for
other Securities of the same series, of any authorized denominations and of like
tenor and aggregate principal amount, upon surrender of the Securities to be
exchanged at such office or agency. Whenever any Securities are so surrendered
for exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Securities which the Holder making the exchange is entitled to
receive.
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All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Securities
surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration of transfer or
for exchange shall (if so required by the Company or the Trustee) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly executed, by the
Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Securities, other than
exchanges pursuant to Section 304, 906 or 1107 not involving any transfer.
If the Securities of any series (or of any series and specified tenor) are
to be redeemed in part, the Company shall not be required (A) to issue, register
the transfer of or exchange any Securities of that series (or of that series and
specified tenor, as the case may be) during a period beginning at the opening of
business 15 days before the day of the mailing of a notice of redemption of any
such Securities selected for redemption under Section 1103 and ending at the
close of business on the day of such mailing, or (B) to register the transfer of
or exchange any Security so selected for redemption in whole or in part, except
the unredeemed portion of any Security being redeemed in part.
The provisions of Clauses (1), (2), (3) and (4) below shall apply only to
Global Securities:
(1) Each Global Security authenticated under this Indenture shall be
registered in the name of the Depositary designated for such Global Security
or a nominee thereof and delivered to such Depositary or a nominee thereof or
custodian therefor, and each such Global Security shall constitute a single
Security for all purposes of this Indenture.
(2) Notwithstanding any other provision in this Indenture, no Global
Security may be exchanged in whole or in part for Securities registered, and
no transfer of a Global Security in whole or in part may be registered, in
the name of any Person other than the Depositary for such Global Security or
a nominee thereof unless (A) such Depositary (i) has notified the Company
that it is unwilling or unable to continue as Depositary for such Global
Security or (ii) has ceased to be a clearing agency registered under the
Exchange Act, (B) there shall have occurred and be continuing an Event of
Default with respect to such Global Security or (C) there shall exist such
circumstances, if any, in addition to or in lieu of the foregoing as have
been specified for this purpose as contemplated by Section 301.
(3) Subject to Clause (2) above, any exchange of a Global Security for
other Securities may be made in whole or in part, and all Securities issued
in exchange for a
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Global Security or any portion thereof shall be registered in such names as
the Depositary for such Global Security shall direct.
(4) Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any
portion thereof, whether pursuant to this Section, Section 304, 306, 906 or
1107 or otherwise, shall be authenticated and delivered in the form of, and
shall be, a Global Security, unless such Security is registered in the name
of a Person other than the Depositary for such Global Security or a nominee
thereof.
The Trustee shall have no obligation or duty to monitor, determine or
inquire as to compliance with any restriction on transfer imposed under this
Indenture or under applicable law with respect to any transfer of any interest
in any Security (including any transfers between or among Depositary
participants or beneficial owners of interests in any Global Security) other
than to require delivery of such certificates and other documentation or
evidence as are expressly required by, and to do so if and when expressly
required by the terms of, this Indenture, and to examine the same to determine
substantial compliance as to form with the express requirements hereof.
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee, the Company shall
execute and the Trustee shall authenticate and deliver in exchange therefor a
new Security of the same series and of like tenor and principal amount and
bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee (i) evidence to
their satisfaction of the destruction, loss or theft of any Security and (ii)
such security or indemnity as may be required by them to save each of them and
any agent of either of them harmless, then, in the absence of notice to the
Company or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and the Trustee shall authenticate and
deliver, in lieu of any such destroyed, lost or stolen Security, a new Security
of the same series and of like tenor and principal amount and bearing a number
not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has become
or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the Company may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including
the fees and expenses of the Trustee) connected therewith.
Every new Security of any series issued pursuant to this Section in lieu
of any destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the destroyed,
lost or stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities of that series duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities.
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SECTION 307. Payment of Interest; Interest Rights Preserved.
Except as otherwise provided as contemplated by Section 301 with respect
to any series of Securities, interest on any Security which is payable, and is
punctually paid or duly provided for, on any Interest Payment Date shall be paid
to the Person in whose name that Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest.
Any interest on any Security of any series which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on the relevant Regular Record Date by virtue of having been such Holder, and
such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest to
the Persons in whose names the Securities of such series (or their
respective Predecessor Securities) are registered at the close of business
on a Special Record Date for the payment of such Defaulted Interest, which
shall be fixed in the following manner. The Company shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be paid
on each Security of such series and the date of the proposed payment, and
at the same time the Company shall deposit with the Trustee an amount
of money equal to the aggregate amount proposed to be paid in respect of
such Defaulted Interest or shall make arrangements satisfactory to the
Trustee for such deposit prior to the date of the proposed payment, such
money when deposited to be held in trust for the benefit of the Persons
entitled to such Defaulted Interest as in this Clause provided. Thereupon
the Trustee shall fix a Special Record Date for the payment of such
Defaulted Interest which shall be not more than 15 days and not less than
10 days prior to the date of the proposed payment and not less than 10
days after the receipt by the Trustee of the notice of the proposed
payment. The Trustee shall promptly notify the Company of such Special
Record Date and, in the name and at the expense of the Company, shall
cause notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor to be given to each Holder of Securities of
such series in the manner set forth in Section 106, not less than 10 days
prior to such Special Record Date. Notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor having been so
mailed, such Defaulted Interest shall be paid to the Persons in whose
names the Securities of such series (or their respective Predecessor
Securities) are registered at the close of business on such Special Record
Date and shall no longer be payable pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest on the
Securities of any series in any other lawful manner not inconsistent with
the requirements of any securities exchange on which such Securities may
be listed, and upon such notice as may be required by such exchange, if,
after notice given by the Company to the Trustee of the proposed payment
pursuant to this Clause, such manner of payment shall be deemed
practicable by the Trustee.
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Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Security shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Security.
SECTION 308. Persons Deemed Owners.
Prior to due presentment of a Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name such Security is registered as the owner of such Security
for the purpose of receiving payment of principal of and any premium and
(subject to Section 307) any interest on such Security and for all other
purposes whatsoever, whether or not such Security be overdue, and neither the
Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary.
SECTION 309. Cancellation.
All Securities surrendered for payment, redemption, registration of
transfer or exchange or for credit against any sinking fund payment shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee
and shall be promptly cancelled by it. The Company may at any time deliver to
the Trustee for cancellation any Securities previously authenticated and
delivered hereunder which the Company may have acquired in any manner
whatsoever, and may deliver to the Trustee (or to any other Person for delivery
to the Trustee) for cancellation any Securities previously authenticated
hereunder which the Company has not issued and sold, and all Securities so
delivered shall be promptly cancelled by the Trustee. No Securities shall be
authenticated in lieu of or in exchange for any Securities cancelled as provided
in this Section, except as expressly permitted by this Indenture. All cancelled
Securities held by the Trustee shall be disposed of as directed by a Company
Order; provided, that in no event shall the Trustee be required to destroy such
cancelled Securities.
SECTION 310. Computation of Interest.
Except as otherwise specified as contemplated by Section 301 for
Securities of any series, interest on the Securities of each series shall be
computed on the basis of a 360-day year of twelve 30-day months.
SECTION 311. CUSIP Numbers.
The Company in issuing the Securities may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Holders; provided that any such notice may
state that no representation is made as to the correctness of such numbers
either as printed on the Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be
affected by any defect in or omission of such numbers. The Company will
promptly notify the Trustee of any change in the "CUSIP" numbers.
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ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be of further effect
(except as to any surviving rights of registration of transfer or exchange of
Securities herein expressly provided for), and the Trustee, at the expense of
the Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered (other than
(i) Securities which have been destroyed, lost or stolen and which have
been replaced or paid as provided in Section 306 and (ii) Securities for
whose payment money has theretofore been deposited in trust or segregated
and held in trust by the Company and thereafter repaid to the Company or
discharged from such trust, as provided in Section 1003) have been
delivered to the Trustee for cancellation; or
(B) all such Securities not theretofore delivered to the Trustee for
cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity within one
year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the
Company,
and the Company, in the case of (i), (ii) or (iii) above, has deposited or
caused to be deposited with the Trustee as trust funds in trust for the
purpose money in an amount sufficient to pay and discharge the entire
indebtedness on such Securities not theretofore delivered to the Trustee
for cancellation, for principal and any premium and interest to the date
of such deposit (in the case of Securities which have become due and
payable) or to the Stated Maturity or Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture
have been complied with.
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Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 607, the obligations of
the Trustee to any Authenticating Agent under Section 614 and, if money shall
have been deposited with the Trustee pursuant to subclause (B) of Clause (1) of
this Section, the obligations of the Trustee under Section 402 and the last
paragraph of Section 1003 shall survive.
SECTION 402. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 1003, all money
deposited with the Trustee pursuant to Section 401 shall be held in trust and
applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal and any premium and
interest for whose payment such money has been deposited with the Trustee.
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default.
"Event of Default", wherever used herein with respect to Securities of any
series, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(1) default in the payment of any interest upon any Security of that
series when it becomes due and payable, and continuance of such default for a
period of 30 days; or
(2) default in the payment of the principal of or any premium on any
Security of that series at its Maturity; or
(3) default in the deposit of any sinking fund payment, when and as due by
the terms of a Security of that series; or
(4) default in the performance, or breach, of any covenant or warranty of
the Company in this Indenture (other than a covenant or warranty a default in
whose performance or whose breach is elsewhere in this Section specifically
dealt with or which has expressly been included in this Indenture solely for
the benefit of series of Securities other than that series), and continuance
of such default or breach for a period of 60 days after there has been given,
by registered or certified mail, to the Company by the Trustee or to the
Company and the Trustee by the Holders of at least 10% in principal amount of
the
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Outstanding Securities of that series a written notice specifying such
default or breach and requiring it to be remedied and stating that such
notice is a "Notice of Default" hereunder; or
(5) the entry by a court having jurisdiction in the premises of (A) a
decree or order for relief in respect of the Company in an involuntary case
or proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or (B) a decree or order adjudging the
Company a bankrupt or insolvent, or approving as properly filed a petition
seeking reorganization, arrangement, adjustment or composition of or in
respect of the Company under any applicable Federal or State law, or
appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator
or other similar official of the Company or of any substantial part of its
property, or ordering the winding up or liquidation of its affairs, and the
continuance of any such decree or order for relief or any such other decree
or order unstayed and in effect for a period of 60 consecutive days; or
(6) the commencement by the Company of a voluntary case or proceeding
under any applicable Federal or State bankruptcy, insolvency, reorganization
or other similar law or of any other case or proceeding to be adjudicated a
bankrupt or insolvent, or the consent by it to the entry of a decree or order
for relief in respect of the Company in an involuntary case or proceeding
under any applicable Federal or State bankruptcy, insolvency, reorganization
or other similar law or to the commencement of any bankruptcy or insolvency
case or proceeding against it, or the filing by it of a petition or answer or
consent seeking reorganization or relief under any applicable Federal or
State law, or the consent by it to the filing of such petition or to the
appointment of or taking possession by a custodian, receiver, liquidator,
assignee, trustee, sequestrator or other similar official of the Company or
of any substantial part of its property, or the making by it of an assignment
for the benefit of creditors, or the admission by it in writing of its
inability to pay its debts generally as they become due, or the taking of
corporate action by the Company in furtherance of any such action; or
(7) any other Event of Default provided with respect to Securities of that
series.
SECTION 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default (other than an Event of Default specified in
Section 501(5) or 501(6)) with respect to Securities of any series at the time
Outstanding occurs and is continuing, then in every such case the Trustee or
the Holders of not less than 25% in principal amount of the Outstanding
Securities of that series may declare the principal amount of all the Securities
of that series (or, if any Securities of that series are Original Issue Discount
Securities, such portion of the principal amount of such Securities as may be
specified by the terms thereof) to be due and payable immediately, by a notice
in writing to the Company (and to the Trustee if given by Holders), and upon any
such declaration such principal amount (or specified amount) shall become
immediately due and payable. If an Event of Default specified in Section 501(5)
or 501 (6) with respect to Securities of any series at the time Outstanding
occurs, the principal amount of all the Securities of that series (or, if any
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Securities of that series are Original Issue Discount Securities, such portion
of the principal amount of such Securities as may be specified by the terms
thereof) shall automatically, and without any declaration or other action on the
part of the Trustee or any Holder, become immediately due and payable.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the Holders of a majority in principal amount of the
Outstanding Securities of that series, by written notice to the Company and the
Trustee, may rescind and annul such declaration and its consequences if
(1) the Company has paid or deposited with the Trustee a sum sufficient
to pay
(A) all overdue interest on all Securities of that series,
(B) the principal of (and premium, if any, on) any Securities of that
series which have become due otherwise than by such declaration of
acceleration and any interest thereon at the rate or rates prescribed
therefor in such Securities,
(C) to the extent that payment of such interest is lawful, interest
upon overdue interest at the rate or rates prescribed therefor in such
Securities, and
(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel;
and
(2) all Events of Default with respect to Securities of that series, other
than the non-payment of the principal of Securities of that series which have
become due solely by such declaration of acceleration, have been cured or
waived as provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
SECTION 503. Collection of Indebtedness and Suits for Enforcement by Trustee.
The Company covenants that if
(1) default is made in the payment of any interest on any Security when
such interest becomes due and payable and such default continues for a period
of 30 days, or
(2) default is made in the payment of the principal of (or premium, if
any, on) any Security at the Maturity thereof,
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the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal and any premium and interest and, to the extent that
payment of such interest shall be legally enforceable, interest on any overdue
principal and premium and on any overdue interest, at the rate or rates
prescribed therefor in such Securities, and, in addition thereto, such further
amount as shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel.
If an Event of Default with respect to Securities of any series occurs and
is continuing, the Trustee may in its discretion proceed to protect and enforce
its rights and the rights of the Holders of Securities of such series by such
appropriate judicial proceedings as the Trustee shall deem most effectual to
protect and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Indenture or in aid of the exercise of any power
granted herein, or to enforce any other proper remedy.
SECTION 504. Trustee May File Proofs of Claim.
In case of any judicial proceeding relative to the Company (or any other
obligor upon the Securities), its property or its creditors, the Trustee shall
be entitled and empowered, by intervention in such proceeding or otherwise, to
take any and all actions authorized under the Trust Indenture Act in order to
have claims of the Holders and the Trustee allowed in any such proceeding. In
particular, the Trustee shall be authorized to collect and receive any moneys or
other property payable or deliverable on any such claims and to distribute the
same; and any custodian, receiver, assignee, trustee, liquidator, sequestrator
or other similar official in any such judicial proceeding is hereby authorized
by each Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the Holders, to
pay to the Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 607.
No provision of this Indenture shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding; provided, however,
that the Trustee may, on behalf of the Holders, vote for the election of a
trustee in bankruptcy or similar official and be a member of a creditors' or
other similar committee.
SECTION 505. Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture or the Securities may
be prosecuted and enforced by the Trustee without the possession of any of the
Securities or the production thereof in any proceeding relating thereto, and any
such proceeding instituted by the Trustee
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shall be brought in its own name as trustee of an express trust, and any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, be for the ratable benefit of the Holders of the Securities in
respect of which such judgment has been recovered.
SECTION 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal or any premium
or interest, upon presentation of the Securities and the notation thereon of the
payment if only partially paid and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under Section 607;
SECOND: To the payment of the amounts then due and unpaid for principal of
and any premium and interest on the Securities in respect of which or for the
benefit of which such money has been collected, ratably, without preference or
priority of any kind, according to the amounts due and payable on such
Securities for principal and any premium and interest, respectively; and
THIRD: To the payment of the remainder, if any, to the Company.
SECTION 507. Limitation on Suits.
No Holder of any Security of any series shall have any right to institute
any proceeding, judicial or otherwise, with respect to this Indenture, or for
the appointment of a receiver or trustee, or for any other remedy hereunder,
unless
(1) such Holder has previously given written notice to the Trustee of a
continuing Event of Default with respect to the Securities of that series;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Securities of that series shall have made written request to the
Trustee to institute proceedings in respect of such Event of Default in its
own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable
indemnity satisfactory to it against the costs, expenses and liabilities to
be incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice, request and
offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been given to
the Trustee during such 60-day period by the Holders of a majority in
principal amount of the Outstanding Securities of that series;
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it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all of such
Holders.
SECTION 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest.
Notwithstanding any other provision in this Indenture, the Holder of any
Security shall have the right, which is absolute and unconditional, to receive
payment of the principal of and any premium and (subject to Section 307)
interest on such Security on the respective Stated Maturities expressed in such
Security (or, in the case of redemption, on the Redemption Date) and to
institute suit for the enforcement of any such payment, and such rights shall
not be impaired without the consent of such Holder.
SECTION 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to enforce any
right or remedy under this Indenture and such proceeding has been discontinued
or abandoned for any reason, or has been determined adversely to the Trustee or
to such Holder, then and in every such case, subject to any determination in
such proceeding, the Company, the Trustee and the Holders shall be restored
severally and respectively to their former positions hereunder and thereafter
all rights and remedies of the Trustee and the Holders shall continue as though
no such proceeding had been instituted.
SECTION 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Securities in the last paragraph of Section
306, no right or remedy herein conferred upon or reserved to the Trustee or to
the Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Securities to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy
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or constitute a waiver of any such Event of Default or an acquiescence therein.
Every right and remedy given by this Article or by law to the Trustee or to the
Holders may be exercised from time to time, and as often as may be deemed
expedient, by the Trustee or by the Holders, as the case may be.
SECTION 512. Control by Holders.
The Holders of a majority in principal amount of the Outstanding
Securities of any series shall have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee, with respect to the
Securities of such series, provided that
(1) such direction shall not be in conflict with any rule of law or with
this Indenture, and
(2) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
SECTION 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Securities of any series may on behalf of the Holders of all the
Securities of such series waive any past default hereunder with respect to such
series and its consequences, except a default
(1) in the payment of the principal of or any premium or interest on any
Security of such series, or
(2) in respect of a covenant or provision hereof which under Article Nine
cannot be modified or amended without the consent of the Holder of each
Outstanding Security of such series affected.
Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
default or impair any right consequent thereon.
SECTION 514. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action taken, suffered or
omitted by it as Trustee, a court may require any party litigant in such suit to
file an undertaking to pay the costs of such suit, and may assess costs against
any such party litigant, in the manner and to the extent provided in the Trust
Indenture Act; provided that neither this Section nor the Trust Indenture Act
shall
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be deemed to authorize any court to require such an undertaking or to make such
an assessment in any suit instituted by the Company or the Trustee.
SECTION 515. Waiver of Usury, Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead, or in any manner whatsoever claim or
take the benefit or advantage of, any usury, stay or extension law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
ARTICLE SIX
THE TRUSTEE
SECTION 601. Certain Duties and Responsibilities.
The duties and responsibilities of the Trustee shall be as provided by the
Trust Indenture Act. Notwithstanding the foregoing, no provision of this
Indenture shall require the Trustee to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its duties hereunder,
or in the exercise of any of its rights or powers, if it shall have grounds
for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it. Whether or not therein
expressly so provided, every provision of this Indenture relating to the conduct
or affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section.
SECTION 602. Notice of Defaults.
If a default occurs hereunder with respect to Securities of any series,
the Trustee shall give the Holders of Securities of such series notice of such
default as and to the extent provided by the Trust Indenture Act; provided,
however, that in the case of any default of the character specified in Section
501(4) with respect to Securities of such series, no such notice to Holders
shall be given until at least 30 days after the occurrence thereof. For the
purpose of this Section, the term "default" means any event which is, or after
notice or lapse of time or both would become, an Event of Default with respect
to Securities of such series.
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SECTION 603. Certain Rights of Trustee.
Subject to the provisions of Section 601:
(1) the Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document believed by it to
be genuine and to have been signed or presented by the proper party or
parties;
(2) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order, and any
resolution of the Board of Directors shall be sufficiently evidenced by a
Board Resolution;
(3) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other
evidence be herein specifically prescribed) may, in the absence of bad faith
on its part, rely upon an Officers' Certificate;
(4) the Trustee may consult with counsel and the written advice of such
counsel or any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon;
(5) the Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any
of the Holders pursuant to this Indenture, unless such Holders shall have
offered to the Trustee reasonable security or indemnity satisfactory to it
against the costs, expenses and liabilities which might be incurred by it
in compliance with such request or direction;
(6) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Trustee, in its discretion, may make such further inquiry
or investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of the Company,
personally or by agent or attorney at the sole cost of the Company and shall
incur no liability or additional liability of any kind by reason of such
inquiry or investigation;
(7) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder;
(8) the Trustee shall not be liable for any action taken, suffered, or
omitted to be taken by it in good faith and reasonably believed by it to be
authorized or within the discretion or rights or powers conferred upon it by
this Indenture;
(9) the Trustee shall not be deemed to have notice of any default or
Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is in fact such
a default is received by the Trustee at the Corporate Trust Office of the
Trustee, and such notice references the Securities and this Indenture; and
(10) the rights, privileges, protections, immunities and benefits given
to the Trustee, including, without limitation, its right to be indemnified,
are extended to, and shall be enforceable by, the Trustee in each of its
capacities hereunder, and to each agent, custodian and other Person
employed to act hereunder.
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SECTION 604. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the Trustee's
certificates of authentication, shall be taken as the statements of the Company,
and neither the Trustee nor any Authenticating Agent assumes any responsibility
for their correctness. The Trustee makes no representations as to the validity
or sufficiency of this Indenture or of the Securities. Neither the Trustee nor
any Authenticating Agent shall be accountable for the use or application by the
Company of Securities or the proceeds thereof.
SECTION 605. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any Security
Registrar or any other agent of the Company, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to Sections
608 and 613, may otherwise deal with the Company with the same rights it would
have if it were not Trustee, Authenticating Agent, Paying Agent, Security
Registrar or such other agent.
SECTION 606. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated from
other funds except to the extent required by law. The Trustee shall be under no
liability for interest on any money received by it hereunder except as otherwise
agreed with the Company.
SECTION 607. Compensation and Reimbursement.
The Company agrees
(1) to pay to the Trustee from time to time such compensation for
all services rendered by it hereunder as the Company and the Trustee shall
from time to time agree in writing (which compensation shall not be
limited by any provision of law in regard to the compensation of a trustee of
an express trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any provision of
this Indenture (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or bad
faith; and
(3) to indemnify the Trustee for, and to hold it harmless against, any
loss, liability or expense incurred without negligence or bad faith on its
part, arising out of or in connection with the acceptance or administration
of the trust or trusts hereunder, including the costs and expenses of
defending itself against any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder.
The provisions of this Section shall survive the termination of this
Indenture.
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SECTION 608. Conflicting Interests.
If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture. To the extent
permitted by such Act, the Trustee shall not be deemed to have a conflicting
interest by virtue of being a trustee under this Indenture with respect to
Securities of more than one series or a trustee under the Indenture, dated as
of August 1, 1991, between the Company and the Trustee and the Indenture, dated
as of February 1, 1990, between the Company, The Upjohn Company Employee Stock
Ownership Trust and the Trustee.
SECTION 609. Corporate Trustee Required; Eligibility.
There shall at all times be one (and only one) Trustee hereunder with
respect to the Securities of each series, which may be Trustee hereunder for
Securities of one or more other series. Each Trustee shall be a Person that is
eligible pursuant to the Trust Indenture Act to act as such, -- and has a
combined capital and surplus of at least $50,000,000 and has its Corporate Trust
Office in New York City. If any such Person publishes reports of condition at
least annually, pursuant to law or to the requirements of its supervising or
examining authority, then for the purposes of this Section and to the extent
permitted by the Trust Indenture Act, the combined capital and surplus of such
Person shall be deemed to be its combined capital and surplus as set forth in
its most recent report of condition so published. If at any time the Trustee
with respect to the Securities of any series shall cease to be eligible in
accordance with the provisions of this Section, it shall resign immediately in
the manner and with the effect hereinafter specified in this Article.
SECTION 610. Resignation and Removal; Appointment of Successor.
No resignation or removal of the Trustee and no appointment of a successor
Trustee pursuant to this Article shall become effective until the acceptance of
appointment by the successor Trustee in accordance with the applicable
requirements of Section 611.
The Trustee may resign at any time with respect to the Securities of one
or more series by giving written notice thereof to the Company. If the
instrument of acceptance by a successor Trustee required by Section 611 shall
not have been delivered to the Trustee within 30 days after the giving of such
notice of resignation, the resigning Trustee may, at the expense of the
Company, petition any court of competent jurisdiction for the appointment of a
successor Trustee with respect to the Securities of such series.
The Trustee may be removed at any time with respect to the Securities of
any series by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series, delivered to the Trustee and to the
Company.
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If at any time:
(1) the Trustee shall fail to comply with Section 608 after written
request therefor by the Company or by any Holder who has been a bona fide
Holder of a Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 609 and shall
fail to resign after written request therefor by the Company or by any such
Holder, or
(3) the Trustee shall become incapable of acting or shall be adjudged a
bankrupt or insolvent or a receiver of the Trustee or of its property shall
be appointed or any public officer shall take charge or control of the
Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation,
then, in any such case, (A) the Company by a Board Resolution may remove the
Trustee with respect to all Securities, or (B) subject to Section 514, any
Holder who has been a bona fide Holder of a Security for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Trustee with respect to all
Securities and the appointment of a successor Trustee or Trustees.
If the Trustee shall resign, be removed or become incapable of acting, or
if a vacancy shall occur in the office of Trustee for any cause, with respect to
the Securities of one or more series, the Company, by a Board Resolution, shall
promptly appoint a successor Trustee or Trustees with respect to the Securities
of that or those series (it being understood that any such successor Trustee may
be appointed with respect to the Securities of one or more or all of such series
and that at any time there shall be only one Trustee with respect to the
Securities of any particular series) and shall comply with the applicable
requirements of Section 611. If, within one year after such resignation, removal
or incapability, or the occurrence of such vacancy, a successor Trustee with
respect to the Securities of any series shall be appointed by Act of the Holders
of a majority in principal amount of the Outstanding Securities of such series
delivered to the Company and the retiring Trustee, the successor Trustee so
appointed shall, forthwith upon its acceptance of such appointment in accordance
with the applicable requirements of Section 611, become the successor Trustee
with respect to the Securities of such series and to that extent supersede the
successor Trustee appointed by the Company. If no successor Trustee with respect
to the Securities of any series shall have been so appointed by the Company or
the Holders and accepted appointment in the manner required by Section 611, any
Holder who has been a bona fide Holder of a Security of such series for at least
six months may, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the appointment of a successor Trustee
with respect to the Securities of such series.
The Company shall give notice of each resignation and each removal of the
Trustee with respect to the Securities of any series and each appointment of a
successor Trustee with respect to the Securities of any series to all Holders of
Securities of such series in the manner provided in Section 106. Each notice
shall include the name of the successor Trustee with respect to the Securities
of such series and the address of its Corporate Trust Office.
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SECTION 611. Acceptance of Appointment by Successor.
In case of the appointment hereunder of a successor Trustee with respect
to all Securities, every such successor Trustee so appointed shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Trustee shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee; but, on the request of the
Company or the successor Trustee, such retiring Trustee shall, upon payment of
its charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee and shall duly
assign, transfer and deliver to such successor Trustee all property and money
held by such retiring Trustee hereunder.
In case of the appointment hereunder of a successor Trustee with respect
to the Securities of one or more (but not all) series, the Company, the retiring
Trustee and each successor Trustee with respect to the Securities of one or more
series shall execute and deliver an indenture supplemental hereto wherein each
successor Trustee shall accept such appointment and which (1) shall contain such
provisions as shall be necessary or desirable to transfer and confirm to, and to
vest in, each successor Trustee all the rights, powers, trusts and duties of the
retiring Trustee with respect to the Securities of that or those series to which
the appointment of such successor Trustee relates, (2) if the retiring Trustee
is not retiring with respect to all Securities, shall contain such provisions as
shall be deemed necessary or desirable to confirm that all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of that
or those series as to which the retiring Trustee is not retiring shall continue
to be vested in the retiring Trustee, and (3) shall add to or change any of the
provisions of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one Trustee, it being
understood that nothing herein or in such supplemental indenture shall
constitute such Trustees co-trustees of the same trust and that each such
Trustee shall be trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Trustee; and upon
the execution and delivery of such supplemental indenture the resignation or
removal of the retiring Trustee shall become effective to the extent provided
therein and each such successor Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties
of the retiring Trustee with respect to the Securities of that or those series
to which the appointment of such successor Trustee relates; but, on request of
the Company or any successor Trustee, such retiring Trustee shall duly assign,
transfer and deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder with respect to the Securities of that or those
series to which the appointment of such successor Trustee relates.
Upon request of any such successor Trustee, the Company shall execute any
and all instruments for more fully and certainly vesting in and confirming to
such successor Trustee all such rights, powers and trusts referred to in the
first or second preceding paragraph, as the case may be.
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No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be qualified and eligible under
this Article.
SECTION 612. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been authenticated,
but not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with the same effect
as if such successor Trustee had itself authenticated such Securities.
SECTION 613. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of the Company (or
any other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor).
SECTION 614. Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents with respect to
one or more series of Securities which shall be authorized to act on behalf of
the Trustee to authenticate Securities of such series issued upon original issue
and upon exchange, registration of transfer or partial redemption thereof or
pursuant to Section 306, and Securities so authenticated shall be entitled to
the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by the Trustee hereunder. Wherever reference is
made in this Indenture to the authentication and delivery of Securities by the
Trustee or the Trustee's certificate of authentication, such reference shall be
deemed to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Company and shall at all times be a corporation organized and
doing business under the laws of the United States of America, any State thereof
or the District of Columbia, authorized under such laws to act as Authenticating
Agent, having a combined capital and surplus of not less than $50,000,000 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
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Section, the combined capital and surplus of such Authenticating Agent shall be
deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. If at any time an Authenticating Agent shall
cease to be eligible in accordance with the provisions of this Section, such
Authenticating Agent shall resign immediately in the manner and with the effect
specified in this Section.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time terminate
the agency of an Authenticating Agent by giving written notice thereof to such
Authenticating Agent and to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall give notice of such
appointment in the manner provided in Section 106 to all Holders of Securities
of the series with respect to which such Authenticating Agent will serve. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as an Authenticating Agent.
No successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section.
The Trustee agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section, and the Trustee
shall be entitled to be reimbursed for such payments, subject to the provisions
of Section 607.
If an appointment with respect to one or more series is made pursuant to
this Section, the Securities of such series may have endorsed thereon, in
addition to or in lieu of the Trustee's certificate of authentication, an
alternative certificate of authentication in the following form:
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This is one of the Securities of the series designated therein referred to
in the within-mentioned Indenture.
......................................,
As Trustee
By .......................................
As Authenticating Agent
By .......................................
Authorized Signatory
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee
(1) semi-annually, not later than June 30 and December 31 in each year, a
list, in such form as the Trustee may reasonably require, of the names and
addresses of the Holders of Securities of each series as of the preceding
June 15 or December 15, as the case may be, and
(2) at such other times as the Trustee may request in writing, within 30
days after the receipt by the Company of any such request, a list of similar
form and content as of a date not more than 15 days prior to the time such
list is furnished;
excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar.
SECTION 702. Preservation of Information; Communications to Holders.
The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 701 and the names and
addresses of Holders received by the Trustee in
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its capacity as Security Registrar. The Trustee may destroy any list furnished
to it as provided in Section 701 upon receipt of a new list so furnished.
The rights of Holders to communicate with other Holders with respect to
their rights under this Indenture or under the Securities, and the corresponding
rights and privileges of the Trustee, shall be as provided by the Trust
Indenture Act.
Every Holder of Securities, by receiving and holding the same, agrees with
the Company and the Trustee that neither the Company nor the Trustee nor any
agent of either of them shall be held accountable by reason of any disclosure of
information as to names and addresses of Holders made pursuant to the Trust
Indenture Act.
SECTION 703. Reports by Trustee.
The Trustee shall transmit to Holders such reports concerning the Trustee
and its actions under this Indenture as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided pursuant thereto.
Reports so required to be transmitted at stated intervals of not more than
12 months shall be transmitted no later than May 15 in each calendar year,
commencing in 2000.
A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each stock exchange upon which any
Securities are listed, with the Commission and with the Company. The Company
will notify the Trustee when any Securities are listed on any stock exchange
or are delisted from any stock exchange.
SECTION 704. Reports by Company.
The Company shall file with the Trustee and the Commission, and transmit
to Holders, such information, documents and other reports, and such summaries
thereof, as may be required pursuant to the Trust Indenture Act at the times and
in the manner provided pursuant to such Act; provided that any such information,
documents or reports required to be filed with the Commission pursuant to
Section 13 or 15(d) of the Exchange Act shall be filed with the Trustee within
15 days after the same is so required to be filed with the Commission.
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ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company May Consolidate, Etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any other Person or
convey, transfer or lease its properties and assets substantially as an entirety
to any Person, and the Company shall not permit any Person to consolidate with
or merge into the Company or convey, transfer or lease its properties and assets
substantially as an entirety to the Company, unless:
(1) in case the Company shall consolidate with or merge into another
Person or convey, transfer or lease its properties and assets substantially
as an entirety to any Person, the Person formed by such consolidation or into
which the Company is merged or the Person which acquires by conveyance or
transfer, or which leases, the properties and assets of the Company
substantially as an entirety shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, the due and punctual payment of the principal of
and any premium and interest on all the Securities and the performance or
observance of every covenant of this Indenture on the part of the Company to
be performed or observed;
(2) immediately after giving effect to such transaction and treating any
indebtedness which becomes an obligation of the Company or any Subsidiary as
a result of such transaction as having been incurred by the Company or such
Subsidiary at the time of such transaction, no Event of Default, and no event
which, after notice or lapse of time or both, would become an Event of
Default, shall have happened and be continuing;
(3) if, as a result of any such consolidation or merger or such
conveyance, transfer or lease, properties or assets of the Company would
become subject to a mortgage, pledge, lien, security interest or other
encumbrance which would not be permitted by this Indenture, the Company or
such successor Person, as the case may be, shall take such steps as shall be
necessary effectively to secure the Securities equally and ratably with (or
prior to) all indebtedness secured thereby; and
(4) the Company has delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that such consolidation, merger,
conveyance, transfer or lease and, if a supplemental indenture is required in
connection with such transaction, such supplemental indenture comply with
this Article and that all conditions precedent herein provided for relating
to such transaction have been complied with.
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SECTION 802. Successor Substituted.
Upon any consolidation of the Company with, or merger of the Company into,
any other Person or any conveyance, transfer or lease of the properties and
assets of the Company substantially as an entirety in accordance with Section
801, the successor Person formed by such consolidation or into which the Company
is merged or to which such conveyance, transfer or lease is made shall succeed
to, and be substituted for, and may exercise every right and power of, the
Company under this Indenture with the same effect as if such successor Person
had been named as the Company herein, and thereafter, except in the case of a
lease, the predecessor Person shall be relieved of all obligations and covenants
under this Indenture and the Securities.
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may enter
into one or more indentures supplemental hereto, in form satisfactory to the
Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the Company and the
assumption by any such successor of the covenants of the Company herein and
in the Securities; or
(2) to add to the covenants of the Company for the benefit of the Holders
of all or any series of Securities (and if such covenants are to be for the
benefit of less than all series of Securities, stating that such covenants
are expressly being included solely for the benefit of such series) or to
surrender any right or power herein conferred upon the Company; or
(3) to add any additional Events of Default for the benefit of the Holders
of all or any series of Securities (and if such additional Events of Default
are to be for the benefit of less than all series of Securities, stating that
such additional Events of Default are expressly being included solely for the
benefit of such series); or
(4) to add to or change any of the provisions of this Indenture to such
extent as shall be necessary to permit or facilitate the issuance of
Securities in bearer form, registrable or not registrable as to principal,
and with or without interest coupons, or to permit or facilitate the issuance
of Securities in uncertificated form; or
(5) to add to, change or eliminate any of the provisions of this Indenture
in respect of one or more series of Securities, provided that any such
addition, change or elimination
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(A) shall neither (i) apply to any Security of any series created prior to
the execution of such supplemental indenture and entitled to the benefit of
such provision nor (ii) modify the rights of the Holder of any such Security
with respect to such provision or (B) shall become effective only when there
is no such Security Outstanding; or
(6) to secure the Securities pursuant to the requirements of Section 1008
or otherwise; or
(7) to establish the form or terms of Securities of any series as
permitted by Sections 201 and 301; or
(8) to evidence and provide for the acceptance of appointment hereunder by
a successor Trustee with respect to the Securities of one or more series and
to add to or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, pursuant to the requirements of Section
611; or
(9) to cure any ambiguity, to correct or supplement any provision herein
which may be defective or inconsistent with any other provision herein, or to
make any other provisions with respect to matters or questions arising under
this Indenture, provided that such action pursuant to this Clause (9) shall
not adversely affect the interests of the Holders of Securities of any series
in any material respect.
SECTION 902. Supplemental Indentures With Consent of Holders.
With the consent of the Holders of not less than a majority in principal
amount of the Outstanding Securities of each series affected by such
supplemental indenture, by Act of said Holders delivered to the Company and the
Trustee, the Company, when authorized by a Board Resolution, and the Trustee may
enter into an indenture or indentures supplemental hereto for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of modifying in any manner the rights of the
Holders of Securities of such series under this Indenture; provided, however,
that no such supplemental indenture shall, without the consent of the Holder of
each Outstanding Security affected thereby,
(1) change the Stated Maturity of the principal of, or any instalment of
principal of or interest on, any Security, or reduce the principal amount
thereof or the rate of interest thereon or any premium payable upon the
redemption thereof, or reduce the amount of the principal of an Original
Issue Discount Security or any other Security which would be due and payable
upon a declaration of acceleration of the Maturity thereof pursuant to
Section 502, or change any Place of Payment where, or the coin or currency in
which, any Security or any premium or interest thereon is payable, or impair
the right to institute suit for the enforcement of any such payment on or
after the Stated Maturity thereof (or, in the case of redemption, on or after
the Redemption Date), or
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(2) reduce the percentage in principal amount of the Outstanding
Securities of any series, the consent of whose Holders is required for any
such supplemental indenture, or the consent of whose Holders is required for
any waiver (of compliance with certain provisions of this Indenture or
certain defaults hereunder and their consequences) provided for in this
Indenture, or
(3) modify any of the provisions of this Section, Section 513 or Section
1010, except to increase any such percentage or to provide that certain other
provisions of this Indenture cannot be modified or waived without the consent
of the Holder of each Outstanding Security affected thereby; provided,
however, that this clause shall not be deemed to require the consent of any
Holder with respect to changes in the references to "the Trustee" and
concomitant changes in this Section and Section 1010, or the deletion of this
proviso, in accordance with the requirements of Sections 611 and 901(8).
A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of one or more particular series of Securities, or which modifies the
rights of the Holders of Securities of such series with respect to such covenant
or other provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Securities of any other series.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
SECTION 903. Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 601) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Trustee may, but shall not be
obligated to, enter into any such supplemental indenture which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.
SECTION 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article, this
Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
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SECTION 905. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act.
SECTION 906. Reference in Securities to Supplemental Indentures.
Securities of any series authenticated and delivered after the execution
of any supplemental indenture pursuant to this Article may, and shall if
required by the Trustee, bear a notation in form approved by the Trustee as to
any matter provided for in such supplemental indenture. If the Company shall so
determine, new Securities of any series so modified as to conform, in the
opinion of the Trustee and the Company, to any such supplemental indenture may
be prepared and executed by the Company and authenticated and delivered by the
Trustee in exchange for Outstanding Securities of such series.
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of each series of
Securities that it will duly and punctually pay the principal of and any premium
and interest on the Securities of that series in accordance with the terms of
the Securities and this Indenture.
SECTION 1002. Maintenance of Office or Agency.
The Company will maintain in each Place of Payment for any series of
Securities an office or agency where Securities of that series may be presented
or surrendered for payment, where Securities of that series may be surrendered
for registration of transfer or exchange and where notices and demands to or
upon the Company in respect of the Securities of that series and this Indenture
may be served. The Company will give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee, and the Company hereby appoints the Trustee as its agent
to receive all such presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more other offices
or agencies where the Securities of one or more series may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; provided,
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however, that no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in each Place of
Payment for Securities of any series for such purposes. The Company will give
prompt written notice to the Trustee of any such designation or rescission and
of any change in the location of any such other office or agency.
SECTION 1003. Money for Securities Payments to Be Held in Trust.
If the Company shall at any time act as its own Paying Agent with respect
to any series of Securities, it will, on or before each due date of the
principal of or any premium or interest on any of the Securities of that series,
segregate and hold in trust for the benefit of the Persons entitled thereto a
sum sufficient to pay the principal and any premium and interest so becoming due
until such sums shall be paid to such Persons or otherwise disposed of as herein
provided and will promptly notify the Trustee of its action or failure so to
act.
Whenever the Company shall have one or more Paying Agents for any series
of Securities, it will, prior to each due date of the principal of or any
premium or interest on any Securities of that series, deposit with a Paying
Agent a sum sufficient to pay such amount, such sum to be held as provided by
the Trust Indenture Act, and (unless such Paying Agent is the Trustee) the
Company will promptly notify the Trustee of its action or failure so to act.
The Company will cause each Paying Agent for any series of Securities
other than the Trustee to execute and deliver to the Trustee an instrument in
which such Paying Agent shall agree with the Trustee, subject to the provisions
of this Section, that such Paying Agent will (1) comply with the provisions of
the Trust Indenture Act applicable to it as a Paying Agent and (2) during the
continuance of any default by the Company (or any other obligor upon the
Securities of that series) in the making of any payment in respect of the
Securities of that series, upon the written request of the Trustee, forthwith
pay to the Trustee all sums held in trust by such Paying Agent for payment in
respect of the Securities of that series.
The Company may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, pay, or by Company
Order direct any Paying Agent to pay, to the Trustee all sums held in trust by
the Company or such Paying Agent, such sums to be held by the Trustee upon the
same trusts as those upon which such sums were held by the Company or such
Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such
Paying Agent shall be released from all further liability with respect to such
money.
Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal of or any premium or
interest on any Security of any series and remaining unclaimed for two years
after such principal, premium or interest has become due and payable shall be
paid to the Company on Company Request, or (if then held by the Company) shall
be discharged from such trust; and the Holder of such Security shall thereafter,
as an unsecured general creditor, look only to the Company for payment thereof,
and all liability of the Trustee or such Paying Agent with respect to such
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trust money, and all liability of the Company as trustee thereof, shall
thereupon cease; provided, however, that the Trustee or such Paying Agent,
before being required to make any such repayment, may at the expense of the
Company cause to be published once, in a newspaper published in the English
language, customarily published on each Business Day and of general circulation
in New York City, notice that such money remains unclaimed and that, after a
date specified therein, which shall not be less than 30 days from the date of
such publication, any unclaimed balance of such money then remaining will be
repaid to the Company.
SECTION 1004. Statement by Officers as to Default.
The Company will deliver to the Trustee, within 120 days after the end of
each fiscal year of the Company ending after the date hereof, an Officers'
Certificate, stating whether or not to the best knowledge of the signers thereof
the Company is in default in the performance and observance of any of the terms,
provisions and conditions of this Indenture (without regard to any period of
grace or requirement of notice provided hereunder) and, if the Company shall be
in default, specifying all such defaults and the nature and status thereof of
which they may have knowledge.
SECTION 1005. Existence.
Subject to Article Eight, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its existence,
rights (charter and statutory) and franchises; provided, however, that the
Company shall not be required to preserve any such right or franchise if the
Board of Directors shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company and that the loss
thereof is not disadvantageous in any material respect to the Holders.
SECTION 1006. Maintenance of Properties.
The Company will cause all properties used or useful in the conduct of its
business or the business of any Subsidiary to be maintained and kept in good
condition, repair and working order and supplied with all necessary equipment
and will cause to be made all necessary repairs, renewals, replacements,
betterments and improvements thereof, all as in the judgment of the Company may
be necessary so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; provided, however, that
nothing in this Section shall prevent the Company from discontinuing the
operation or maintenance of any of such properties if such discontinuance is, in
the judgment of the Company, desirable in the conduct of its business or the
business of any Subsidiary and not disadvantageous in any material respect to
the Holders.
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SECTION 1007. Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (1) all taxes, assessments and
governmental charges levied or imposed upon the Company or any Subsidiary or
upon the income, profits or property of the Company or any Subsidiary, and (2)
all lawful claims for labor, materials and supplies which, if unpaid, might by
law become a lien upon the property of the Company or any Subsidiary; provided,
however, that the Company shall not be required to pay or discharge or cause to
be paid or discharged any such tax, assessment, charge or claim whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings.
SECTION 1008. Restrictions on Liens.
The Company will not itself, and will not permit any Principal Subsidiary
to, incur, issue, assume or guarantee any notes, bonds, debentures or other
similar evidences of indebtedness for money borrowed (notes, bonds, debentures
or other similar evidences of indebtedness for money borrowed being hereinafter
in this Section 1008 called "Debt"), secured by pledge of, or mortgage or other
lien on, any Principal Manufacturing Property of the Company or any Principal
Subsidiary, or any shares of stock or Debt of any Principal Subsidiary (pledges,
mortgages and other liens being hereinafter in this Section 1008 called
"Mortgage" or "Mortgages"), without effectively providing that the Securities
then Outstanding together with, if the Company shall so determine, any other
Debt of the Company or such Principal Subsidiary then existing or thereafter
created which is not subordinate to the Securities) shall be secured equally and
ratably with (or prior to) such secured Debt, so long as such secured Debt shall
be so secured, unless, after giving effect thereto, the aggregate amount of all
such secured Debt plus all Attributable Debt of the Company and its Principal
Subsidiaries in respect of sale and leaseback transactions as defined in Section
1009 would not exceed 10% of Consolidated Net Tangible Assets; provided,
however, that this Section shall not apply to, and there shall be excluded from
secured Debt in any computation under this Section, Debt secured by (1)
Mortgages on property of, or on any shares of stock or Debt of, any corporation
existing at the time such corporation became a Principal Subsidiary; (2)
Mortgages in favor of the Company or any Principal Subsidiary; (3) Mortgages in
favor of the United States of America, or any agency, department or other
instrumentality thereof, to secure progress, advance or other payments pursuant
to any contract or provision of any statute; (4) Mortgages on property, shares
of stock or Debt existing at the time of acquisition thereof (including
acquisition through merger or consolidation) or to secure the payment of all or
any part of the purchase price or construction cost thereof or to secure any
Debt incurred prior to, at the time of, or within 120 days after, the
acquisition of such property or shares or Debt or the completion of any such
construction for the purpose of financing all or any part of the purchase price
or construction cost thereof; (5) Mortgages on property or buildings that
comprise, or will comprise, the Company's new headquarters facility in
Peapack/Gladstone, New Jersey; and (6) any extension, renewal or replacement
(or successive extensions, renewals or replacements), as a whole or in part, of
any Mortgage referred to in the foregoing clauses (1) to (5) inclusive;
provided, that in the case of clauses (1) to (4), (i) such extension, renewal or
replacement
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Mortgage shall be limited to all or a part of the same property, shares of stock
or Debt that secured the Mortgage extended, renewed or replaced (plus
improvements on such property) and (ii) the debt secured by such Mortgage at
such time is not increased.
SECTION 1009. Restrictions on Sales and Leasebacks.
The Company will not itself, and will not permit any Principal Subsidiary
to, enter into any arrangement with any bank, insurance company or other lender
or investor (not including the Company or any Principal Subsidiary) or to which
any such lender or investor is a party, providing for the leasing by the Company
or a Principal Subsidiary for a period, including renewals, in excess of three
years of any Principal Manufacturing Property, which has been or is to be sold
or transferred, more than 120 days after the completion of construction and
commencement of full operation thereof, by the Company or any Principal
Subsidiary to such lender or investor or to any person to whom funds have been
or are to be advanced by such lender or investor on the security of such
Principal Manufacturing Property (referred to in this section as a "sale and
leaseback transaction") unless either (1) the Company or such Principal
Subsidiary could create Debt secured by a Mortgage pursuant to Section 1008 on
the Principal Manufacturing Property to be leased back in an amount equal to the
Attributable Debt with respect to such sale and leaseback transaction without
equally and ratably securing the Securities, or (2) the Company, within 120 days
after the sale or transfer shall have been made by the Company or by a Principal
Subsidiary, applies an amount equal to the greater of (i) the net proceeds of
the sale of the Principal Manufacturing Property sold and leased back pursuant
to such arrangement or (ii) the fair market value of the Principal Manufacturing
Property so sold and leased back at the time of entering into such arrangement
as determined by the Board of Directors to the retirement of Funded Debt of the
Company; provided, that the amount to be applied to the retirement of Funded
Debt of the Company shall be reduced by (a) the principal amount of any
Securities delivered within 120 days after such sale to the Trustee for
retirement and cancellation and (b) the principal amount of Funded Debt, other
than Securities voluntarily retired by the Company within 120 days after such
sale. Notwithstanding the foregoing, no retirement referred to in this clause
(2) may be effected by payment at maturity or pursuant to any mandatory sinking
fund payment or mandatory prepayment provision.
SECTION 1010. Waiver of Certain Covenants.
Except as otherwise specified as contemplated by Section 301 for
Securities of such series, the Company may, with respect to the Securities of
any series, omit in any particular instance to comply with any term, provision
or condition set forth in any covenant provided pursuant to Section 301(18),
901(2) or 901(7) for the benefit of the Holders of such series or in any of
Sections 1008 to 1009, inclusive, if before the time for such compliance the
Holders of at least a majority in principal amount of the Outstanding Securities
of such series shall, by Act of such Holders, either waive such compliance in
such instance or generally waive compliance with such term, provision or
condition, but no such waiver shall extend to or affect such term, provision or
condition except to the extent so expressly waived, and, until
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such waiver shall become effective, the obligations of the Company and the
duties of the Trustee in respect of any such term, provision or condition shall
remain in full force and effect.
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 1101. Applicability of Article.
Securities of any series which are redeemable before their Stated Maturity
shall be redeemable in accordance with their terms and (except as otherwise
specified as contemplated by Section 301 for such Securities) in accordance with
this Article.
SECTION 1102. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be evidenced by
a Board Resolution or in another manner specified as contemplated by Section 301
for such Securities. In case of any redemption at the election of the Company of
less than all the Securities of any series (including any such redemption
affecting only a single Security), the Company shall, at least 60 days prior to
the Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee of such Redemption Date, of the
principal amount of Securities of such series to be redeemed and, if applicable,
of the tenor of the Securities to be redeemed. In the case of any redemption of
Securities prior to the expiration of any restriction on such redemption
provided in the terms of such Securities or elsewhere in this Indenture, the
Company shall furnish the Trustee with an Officers' Certificate evidencing
compliance with such restriction.
SECTION 1103. Selection by Trustee of Securities to Be Redeemed.
If less than all the Securities of any series are to be redeemed (unless
all the Securities of such series and of a specified tenor are to be redeemed or
unless such redemption affects only a single Security), the particular
Securities to be redeemed shall be selected not more than 60 days prior to the
Redemption Date by the Trustee, from the Outstanding Securities of such series
not previously called for redemption, by such method as the Trustee shall deem
fair and appropriate and which may provide for the selection for redemption of a
portion of the principal amount of any Security of such series, provided that
the unredeemed portion of the principal amount of any Security shall be in an
authorized denomination (which shall not be less than the minimum authorized
denomination) for such Security. If less than all the Securities of such series
and of a specified tenor are to be redeemed (unless such redemption affects only
a single Security), the particular Securities to be redeemed shall be selected
not more than 60 days prior to the Redemption Date by the Trustee, from the
Outstanding
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Securities of such series and specified tenor not previously called for
redemption in accordance with the preceding sentence.
The Trustee shall promptly notify the Company in writing of the Securities
selected for redemption as aforesaid and, in case of any Securities selected for
partial redemption as aforesaid, the principal amount thereof to be redeemed.
The provisions of the two preceding paragraphs shall not apply with
respect to any redemption affecting only a single Security, whether such
Security is to be redeemed in whole or in part. In the case of any such
redemption in part, the unredeemed portion of the principal amount of the
Security shall be in an authorized denomination (which shall not be less than
the minimum authorized denomination) for such Security.
For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to the redemption of Securities shall relate, in the
case of any Securities redeemed or to be redeemed only in part, to the portion
of the principal amount of such Securities which has been or is to be redeemed.
SECTION 1104. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage prepaid,
mailed not less than 30 nor more than 60 days prior to the Redemption Date, to
each Holder of Securities to be redeemed, at his address appearing in the
Security Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the Outstanding Securities of any series consisting
of more than a single Security are to be redeemed, the identification (and,
in the case of partial redemption of any such Securities, the principal
amounts) of the particular Securities to be redeemed and, if less than all
the Outstanding Securities of any series consisting of a single Security are
to be redeemed, the principal amount of the particular Security to be
redeemed,
(4) that on the Redemption Date the Redemption Price will become due and
payable upon each such Security to be redeemed and, if applicable, that
interest thereon will cease to accrue on and after said date,
(5) the place or places where each such Security is to be surrendered for
payment of the Redemption Price,
(6) that the redemption is for a sinking fund, if such is the case, and
(7) the CUSIP number or numbers for such Security.
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Notice of redemption of Securities to be redeemed at the election of the
Company shall be given by the Company or, at the Company's request given to the
Trustee at least 15 days before the proposed mailing date of such notice (or
such shorter period as shall be acceptable to the Trustee), by the Trustee
in the name and at the expense of the Company and shall be irrevocable.
SECTION 1105. Deposit of Redemption Price.
Prior to any Redemption Date, the Company shall deposit with the Trustee
or with a Paying Agent (or, if the Company is acting as its own Paying Agent,
segregate and hold in trust as provided in Section 1003) an amount of money
sufficient to pay the Redemption Price of, and (except if the Redemption Date
shall be an Interest Payment Date) accrued interest on, all the Securities which
are to be redeemed on that date.
SECTION 1106. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities so to
be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cease to bear interest. Upon surrender of any
such Security for redemption in accordance with said notice, such Security shall
be paid by the Company at the Redemption Price, together with accrued interest
to the Redemption Date; provided, however, that, unless otherwise specified as
contemplated by Section 301, instalments of interest whose Stated Maturity is on
or prior to the Redemption Date will be payable to the Holders of such
Securities, or one or more Predecessor Securities, registered as such at the
close of business on the relevant Record Dates according to their terms and the
provisions of Section 307.
If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal and any premium shall, until paid, bear
interest from the Redemption Date at the rate prescribed therefor in the
Security.
SECTION 1107. Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall be surrendered at
a Place of Payment therefor (with, if the Company or the Trustee so requires,
due endorsement by, or a written instrument of transfer in form satisfactory to
the Company and the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing), and the Company shall execute, and the Trustee
shall authenticate and deliver to the Holder of such Security without service
charge, a new Security or Securities of the same series and of like tenor, of
any authorized denomination as requested by such Holder, in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of
the Security so surrendered.
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ARTICLE TWELVE
SINKING FUNDS
SECTION 1201. Applicability of Article.
The provisions of this Article shall be applicable to any sinking fund for
the retirement of Securities of any series except as otherwise specified as
contemplated by Section 301 for such Securities.
The minimum amount of any sinking fund payment provided for by the terms
of any Securities is herein referred to as a "mandatory sinking fund payment",
and any payment in excess of such minimum amount provided for by the terms of
such Securities is herein referred to as an "optional sinking fund payment". If
provided for by the terms of any Securities, the cash amount of any sinking fund
payment may be subject to reduction as provided in Section 1202. Each sinking
fund payment shall be applied to the redemption of Securities as provided for by
the terms of such Securities.
SECTION 1202. Satisfaction of Sinking Fund Payments with Securities.
The Company (1) may deliver Outstanding Securities of a series (other than
any previously called for redemption) and (2) may apply as a credit Securities
of a series which have been redeemed either at the election of the Company
pursuant to the terms of such Securities or through the application of permitted
optional sinking fund payments pursuant to the terms of such Securities, in each
case in satisfaction of all or any part of any sinking fund payment with respect
to any Securities of such series required to be made pursuant to the terms of
such Securities as and to the extent provided for by the terms of such
Securities; provided that the Securities to be so credited have not been
previously so credited. The Securities to be so credited shall be received and
credited for such purpose by the Trustee at the Redemption Price, as specified
in the Securities so to be redeemed, for redemption through operation of the
sinking fund and the amount of such sinking fund payment shall be reduced
accordingly.
SECTION 1203. Redemption of Securities for Sinking Fund.
Not less than 60 days prior to each sinking fund payment date for any
Securities, the Company will deliver to the Trustee an Officers' Certificate
specifying the amount of the next ensuing sinking fund payment for such
Securities pursuant to the terms of such Securities, the portion thereof, if
any, which is to be satisfied by payment of cash and the portion thereof, if
any, which is to be satisfied by delivering and crediting Securities pursuant to
Section 1202 and will also deliver to the Trustee any Securities to be so
delivered. Not less than 45 days prior to each such sinking fund payment date,
the Trustee shall select the Securities to be redeemed upon such sinking fund
payment date in the manner specified in
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Section 1103 and cause notice of the redemption thereof to be given in the name
of and at the expense of the Company in the manner provided in Section 1104.
Such notice having been duly given, the redemption of such Securities shall be
made upon the terms and in the manner stated in Sections 1106 and 1107.
ARTICLE THIRTEEN
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1301. Company's Option to Effect Defeasance or Covenant Defeasance.
The Company may elect, at its option at any time, to have Section 1302 or
Section 1303 applied to any Securities or any series of Securities, as the case
may be, designated pursuant to Section 301 as being defeasible pursuant to such
Section 1302 or 1303, in accordance with any applicable requirements provided
pursuant to Section 301 and upon compliance with the conditions set forth below
in this Article. Any such election shall be evidenced by a Board Resolution or
in another manner specified as contemplated by Section 301 for such Securities.
SECTION 1302. Defeasance and Discharge.
Upon the Company's exercise of its option (if any) to have this Section
applied to any Securities or any series of Securities, as the case may be, the
Company shall be deemed to have been discharged from its obligations with
respect to such Securities as provided in this Section on and after the date the
conditions set forth in Section 1304 are satisfied (hereinafter called
"Defeasance"). For this purpose, such Defeasance means that the Company shall be
deemed to have paid and discharged the entire indebtedness represented by such
Securities and to have satisfied all its other obligations under such Securities
and this Indenture insofar as such Securities are concerned (and the Trustee, at
the expense of the Company, shall execute proper instruments acknowledging the
same), subject to the following which shall survive until otherwise terminated
or discharged hereunder: (1) the rights of Holders of such Securities to
receive, solely from the trust fund described in Section 1304 and as more fully
set forth in such Section, payments in respect of the principal of and any
premium and interest on such Securities when payments are due, (2) the Company's
obligations with respect to such Securities under Sections 304, 305, 306, 1002
and 1003, (3) the rights, powers, trusts, duties and immunities of the Trustee
hereunder and (4) this Article. Subject to compliance with this Article, the
Company may exercise its option (if any) to have this Section applied to any
Securities notwithstanding the prior exercise of its option (if any) to have
Section 1303 applied to such Securities.
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SECTION 1303. Covenant Defeasance.
Upon the Company's exercise of its option (if any) to have this Section
applied to any Securities or any series of Securities, as the case may be, (1)
the Company shall be released from its obligations under Section 801(3),
Sections 1006 through 1009, inclusive, and any covenants provided pursuant to
Section 301(18), 901(2) or 901(7) for the benefit of the Holders of such
Securities, and (2) the occurrence of any event specified in Sections 501(4)
(with respect to any of Section 801(3), Sections 1006 through 1009, inclusive,
and any such covenants provided pursuant to Section 301(18), 901(2) or 901(7)),
501(5) and 501(8) shall be deemed not to be or result in an Event of Default, in
each case with respect to such Securities as provided in this Section on and
after the date the conditions set forth in Section 1304 are satisfied
(hereinafter called "Covenant Defeasance"). For this purpose, such Covenant
Defeasance means that, with respect to such Securities, the Company may omit to
comply with and shall have no liability in respect of any term, condition or
limitation set forth in any such specified Section (to the extent so specified
in the case of Section 501(4)), whether directly or indirectly by reason of any
reference elsewhere herein to any such Section or by reason of any reference in
any such Section to any other provision herein or in any other document, but the
remainder of this Indenture and such Securities shall be unaffected thereby.
SECTION 1304. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to the application of Section 1302
or Section 1303 to any Securities or any series of Securities, as the case may
be:
(1) The Company shall irrevocably have deposited or caused to be deposited
with the Trustee (or another trustee which satisfies the requirements
contemplated by Section 609 and agrees to comply with the provisions of this
Article applicable to it) as trust funds in trust for the purpose of making
the following payments, specifically pledged as security for, and dedicated
solely to, the benefits of the Holders of such Securities, (A) money in an
amount, or (B) U.S. Government Obligations which through the scheduled
payment of principal and interest in respect thereof in accordance with their
terms will provide, not later than one day before the due date of any
payment, money in an amount, or (C) a combination thereof, in each case
sufficient, in the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification thereof delivered to
the Trustee, to pay and discharge, and which shall be applied by the Trustee
(or any such other qualifying trustee) to pay and discharge, the principal of
and any premium and interest on such Securities on the respective Stated
Maturities, in accordance with the terms of this Indenture and such
Securities. As used herein, "U.S. Government Obligation" means (x) any
security which is (i) a direct obligation of the United States of America for
the payment of which the full faith and credit of the United States of
America is pledged or (ii) an obligation of a Person controlled or supervised
by and acting as an agency or instrumentality of the United States of America
the payment of which is unconditionally guaranteed as a full faith and credit
obligation by the United States of America, which, in either case (i) or
(ii), is not callable or redeemable at the option of the issuer thereof, and
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<PAGE> 71
(y) any depositary receipt issued by a bank (as defined in Section 3(a)(2) of
the Securities Act) as custodian with respect to any U.S. Government
Obligation which is specified in Clause (x) above and held by such bank for
the account of the holder of such depositary receipt, or with respect to any
specific payment of principal of or interest on any U.S. Government
Obligation which is so specified and held, provided that (except as required
by law) such custodian is not authorized to make any deduction from the
amount payable to the holder of such depositary receipt from any amount
received by the custodian in respect of the U.S. Government Obligation or the
specific payment of principal or interest evidenced by such depositary
receipt.
(2) In the event of an election to have Section 1302 apply to any
Securities or any series of Securities, as the case may be, the Company shall
have delivered to the Trustee an Opinion of Counsel stating that (A) the
Company has received from, or there has been published by, the Internal
Revenue Service a ruling or (B) since the date of this instrument, there has
been a change in the applicable Federal income tax law, in either case (A) or
(B) to the effect that, and based thereon such opinion shall confirm that,
the Holders of such Securities will not recognize gain or loss for Federal
income tax purposes as a result of the deposit, Defeasance and discharge to
be effected with respect to such Securities and will be subject to Federal
income tax on the same amount, in the same manner and at the same times as
would be the case if such deposit, Defeasance and discharge were not to
occur.
(3) In the event of an election to have Section 1303 apply to any
Securities or any series of Securities, as the case may be, the Company shall
have delivered to the Trustee an Opinion of Counsel to the effect that the
Holders of such Securities will not recognize gain or loss for Federal income
tax purposes as a result of the deposit and Covenant Defeasance to be
effected with respect to such Securities and will be subject to Federal
income tax on the same amount, in the same manner and at the same times as
would be the case if such deposit and Covenant Defeasance were not to occur.
(4) The Company shall have delivered to the Trustee an Officers'
Certificate to the effect that neither such Securities nor any other
Securities of the same series, if then listed on any securities exchange,
will be delisted as a result of such deposit.
(5) No event which is, or after notice or lapse of time or both would
become, an Event of Default with respect to such Securities or any other
Securities shall have occurred and be continuing at the time of such deposit
or, with regard to any such event specified in Sections 501(5) and (6), at
any time on or prior to the 90th day after the date of such deposit (it being
understood that this condition shall not be deemed satisfied until after such
90th day).
(6) Such Defeasance or Covenant Defeasance shall not cause the Trustee to
have a conflicting interest within the meaning of the Trust Indenture Act
(assuming all Securities are in default within the meaning of such Act).
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<PAGE> 72
(7) Such Defeasance or Covenant Defeasance shall not result in a breach or
violation of, or constitute a default under, any other agreement or
instrument to which the Company is a party or by which it is bound.
(8) Such Defeasance or Covenant Defeasance shall not result in the trust
arising from such deposit constituting an investment company within the
meaning of the Investment Company Act unless such trust shall be registered
under such Act or exempt from registration thereunder.
(9) The Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent with respect to such Defeasance or Covenant Defeasance have been
complied with.
SECTION 1305. Deposited Money and U.S. Government Obligations to Be
Held in Trust; Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section 1003, all money
and U.S. Government Obligations (including the proceeds thereof) deposited with
the Trustee or other qualifying trustee (solely for purposes of this Section and
Section 1306, the Trustee and any such other trustee are referred to
collectively as the "Trustee") pursuant to Section 1304 in respect of any
Securities shall be held in trust and applied by the Trustee, in accordance with
the provisions of such Securities and this Indenture, to the payment, either
directly or through any such Paying Agent (including the Company acting as its
own Paying Agent) as the Trustee may determine, to the Holders of such
Securities, of all sums due and to become due thereon in respect of principal
and any premium and interest, but money so held in trust need not be segregated
from other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 1304 or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is for
the account of the Holders of Outstanding Securities.
Anything in this Article to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon Company Request any
money or U.S. Government Obligations held by it as provided in Section 1304 with
respect to any Securities which, in the opinion of a nationally recognized firm
of independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof which would then
be required to be deposited to effect the Defeasance or Covenant Defeasance, as
the case may be, with respect to such Securities.
SECTION 1306. Reinstatement.
If the Trustee or the Paying Agent is unable to apply any money in
accordance with this Article with respect to any Securities by reason of any
order or judgment of any court or
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<PAGE> 73
governmental authority enjoining, restraining or otherwise prohibiting such
application, then the obligations under this Indenture and such Securities from
which the Company has been discharged or released pursuant to Section 1302 or
1303 shall be revived and reinstated as though no deposit had occurred pursuant
to this Article with respect to such Securities, until such time as the Trustee
or Paying Agent is permitted to apply all money held in trust pursuant to
Section 1305 with respect to such Securities in accordance with this Article;
provided, however, that if the Company makes any payment of principal of or any
premium or interest on any such Security following such reinstatement of its
obligations, the Company shall be subrogated to the rights (if any) of the
Holders of such Securities to receive such payment from the money so held in
trust.
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed all as of the day and year first above written.
PHARMACIA & UPJOHN, INC.
By
THE BANK OF NEW YORK
By
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<PAGE> 1
EXHIBIT 4.5
OPTIONS REPRESENTED BY BRACKETED OR BLANK SECTIONS
HEREIN SHALL BE DETERMINED IN CONFORMITY WITH THE
APPLICABLE PROSPECTUS SUPPLEMENT OR SUPPLEMENTS
================================================================================
PHARMACIA & UPJOHN, INC.
and
-----------------------------
As Warrant Agent
----------
Debt Warrant Agreement
Dated as of
-----------------
-----------------
================================================================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
Parties.............................................................................. 1
Recitals............................................................................. 1
ARTICLE I
ISSUANCE, EXECUTION AND COUNTERSIGNATURE
OF WARRANT CERTIFICATES
Section 1.01. Issuance of Warrant Certificates................................... 1
Section 1.02. Form of Warrant Certificates....................................... 2
Section 1.03. Execution and Authentication of Warrant Certificates............... 2
Section 1.04. Temporary Warrant Certificates..................................... 3
Section 1.05. Payment of Taxes................................................... 3
Section 1.06. Definition of Holder............................................... 4
ARTICLE II
WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS
Section 2.01. Warrant Price...................................................... 4
Section 2.02. Duration of Warrants............................................... 4
Section 2.03. Exercise of Warrants............................................... 5
ARTICLE III
REGISTRATION, EXCHANGE, TRANSFER AND
SUBSTITUTION OF WARRANT CERTIFICATES
Section 3.01. Registration, Exchange and Transfer of Warrant
Certificates....................................................... 6
Section 3.02. Mutilated, Destroyed, Lost or Stolen Warrant Certificates.......... 7
Section 3.03. Persons Deemed Owners.............................................. 7
Section 3.04. Cancellation of Warrant Certificates............................... 8
</TABLE>
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<PAGE> 3
<TABLE>
<CAPTION>
Page
<S> <C>
ARTICLE IV
OTHER PROVISIONS RELATING TO RIGHTS
OF HOLDERS OF WARRANT CERTIFICATES
Section 4.01. No Rights as Holders of Warrant Debt Securities Conferred
by Warrants or Warrant Certificates................................ 8
Section 4.02. Holder of Warrant Certificate May Enforce Rights................... 8
ARTICLE V
CONCERNING THE WARRANT AGENT
Section 5.01. Warrant Agent...................................................... 9
Section 5.02. Conditions of Warrant Agent's Obligations.......................... 9
Section 5.03. Resignation, Removal and Appointment of Successor.................. 11
Section 5.04. Compliance With Applicable Laws.................................... 12
ARTICLE VI
MISCELLANEOUS
Section 6.01. Consolidations and Mergers of the Company and Sales,
Leases and Conveyances Permitted Subject to Certain
Conditions......................................................... 13
Section 6.02. Rights and Duties of Successor Corporation......................... 13
Section 6.03. Amendment.......................................................... 13
Section 6.04. Notice and Demands to the Company and Warrant Agent................ 14
Section 6.05. Notices to Holders of Warrant Certificates......................... 14
Section 6.06. Addresses.......................................................... 14
Section 6.07. Governing Law...................................................... 14
Section 6.08. Delivery of Prospectus............................................. 14
Section 6.09. Obtaining of Governmental Approvals................................ 14
Section 6.10. Persons Having Rights Under Warrant Agreement...................... 15
Section 6.11. Headings........................................................... 15
Section 6.12. Counterparts....................................................... 15
Section 6.13. Inspection of Agreement............................................ 15
</TABLE>
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<PAGE> 4
THIS DEBT WARRANT AGREEMENT, dated as of ________, 19__,
between Pharmacia & Upjohn, Inc., a corporation duly organized and existing
under the laws of the State of Delaware (the "Company"), and
____________________, a [corporation] [state] [banking association] [national
banking association] organized and existing under the laws of ___________ as
Warrant Agent (herein called the "Warrant Agent").
WHEREAS, the Company has entered into an Indenture, dated as
of ___________, 1999 (the "Indenture"), with __________________ as trustee (such
trustee, and any successors to such trustee, herein called the "Trustee"),
providing for the issuance from time to time of its unsecured and unsubordinated
notes or other evidences of senior indebtedness, to be issued in one or more
series as provided in the Indenture;
WHEREAS, the Company proposes to sell [If Offered Debt
Securities and Warrants -- [title of Debt Securities being offered] (the
"Offered Debt Securities") with] warrant certificates (such warrant certificates
and other warrant certificates issued pursuant to this Agreement herein called
the "Warrant Certificates") evidencing one or more warrants (the "Warrants" or,
individually, a "Warrant") representing the right to purchase [title of Debt
Securities purchasable through exercise of Warrants] (the "Warrant Debt
Securities"); and
WHEREAS, the Company desires the Warrant Agent to act on
behalf of the Company, and the Warrant Agent is willing to so act, in connection
with the issuance, exchange, exercise and replacement of the Warrant
Certificates, and in this Agreement wishes to set forth, among other things, the
form and provisions of the Warrant Certificates and the terms and conditions on
which they may be issued, exchanged, exercised and replaced;
NOW, THEREFORE, in consideration of the premises and of the
mutual agreements herein contained, the parties hereto agree as follows:
ARTICLE I
ISSUANCE, EXECUTION AND COUNTERSIGNATURE
OF WARRANT CERTIFICATES
Section 1.01. Issuance of Warrant Certificates. [If Warrants
alone --Upon issuance, each Warrant Certificate shall evidence one or more
Warrants.] [If Offered Debt Securities and Warrants -- Warrant Certificates
shall be [initially] issued in units with the Offered Debt Securities and shall
[not] be separately transferable [before __________, 19__ (the "Detachable
Date")]. Each such unit shall consist of a Warrant Certificate or Certificates
evidencing an aggregate of ____ Warrants for each
<PAGE> 5
$__________ principal amount of Offered Debt Securities. Each Warrant evidenced
thereby shall represent the right, subject to the provisions contained herein
and therein, to purchase Warrant Debt Securities in the aggregate principal
amount of $__________.
Section 1.02. Form of Warrant Certificates. The Warrant
Certificates (including the Form[s] of Exercise [and Assignment] to be set forth
on the reverse thereof) shall be in substantially the form set forth in Exhibit
A hereto, shall be printed, lithographed or engraved on steel engraved borders
(or in any other manner determined by the officers executing such Warrant
Certificates) and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as may be
required to comply with any law or with any rule or regulation made pursuant
thereto or with any rule or regulation of any securities exchange on which the
Warrant Certificates may be listed or as may, consistently herewith, be
determined by the officers executing such Warrant Certificates, as evidenced by
their execution of the Warrant Certificates.
Section 1.03. Execution and Authentication of Warrant
Certificates. The Warrant Certificates shall be executed on behalf of the
Company by its Chairman, its President or one of its Vice Presidents (any
reference to a Vice President of the Company herein shall be deemed to include
any Vice President of the Company whether or not designated by a number or a
word or words added before or after the title "Vice President") under its
corporate seal reproduced thereon attested to by its Secretary or one of its
Assistant Secretaries. The signature of any of these officers on the Warrant
Certificates may be manual or facsimile.
Warrant Certificates evidencing the right to purchase an
aggregate principal amount not exceeding $ __________ of Warrant Debt Securities
(except as provided in Sections 1.04, 2.03(c), 3.01 and 3.02) may be executed by
the Company and delivered to the Warrant Agent upon the execution of this
Warrant Agreement or from time to time thereafter. The Warrant Agent shall, upon
receipt of Warrant Certificates duly executed on behalf of the Company,
authenticate Warrant Certificates evidencing Warrants representing the right to
purchase up to $___________ aggregate principal amount of Warrant Debt
Securities and shall deliver such Warrant Certificates to or upon the order of
the Company. Subsequent to such original issuance of the Warrant Certificates,
the Warrant Agent shall authenticate a Warrant Certificate only if the Warrant
Certificate is issued in exchange or substitution for one or more previously
authenticated Warrant Certificates or in connection with their transfer, as
hereinafter provided.
Each Warrant Certificate shall be dated the date of its
authentication by the Warrant Agent.
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<PAGE> 6
No Warrant Certificate shall be entitled to any benefit under
this Agreement or be valid or obligatory for any purpose, and no Warrant
evidenced thereby shall be exercisable, until such Warrant Certificate has been
authenticated by the manual signature of the Warrant Agent. Such signature by
the Warrant Agent upon any Warrant Certificate executed by the Company shall be
conclusive evidence, and the only evidence, that the Warrant Certificate so
authenticated has been duly issued hereunder.
Warrant Certificates bearing the manual or facsimile
signatures of individuals who were at any time the proper officers of the
Company shall bind the Company, notwithstanding that such individuals or any of
them have ceased to hold such offices prior to the authentication and delivery
of such Warrant Certificates or did not hold such offices at the date of such
Warrant Certificates.
Section 1.04. Temporary Warrant Certificates. Pending the
preparation of definitive Warrant Certificates, the Company may execute, and
upon the order of the Company the Warrant Agent shall authenticate and deliver,
temporary Warrant Certificates which are printed, lithographed, typewritten,
mimeographed or otherwise produced substantially of the tenor of the definitive
Warrant Certificates in lieu of which they are issued and with such appropriate
insertions, omissions, substitutions and other variations as the officers
executing such Warrant Certificates may determine, as evidenced by their
execution of such Warrant Certificates.
If temporary Warrant Certificates are issued, the Company will
cause definitive Warrant Certificates to be prepared without unreasonable delay.
After the preparation of definitive Warrant Certificates, the temporary Warrant
Certificates shall be exchangeable for definitive Warrant Certificates upon
surrender of the temporary Warrant Certificates at the corporate trust office of
the Warrant Agent [or ___________], without charge to the Holder. Upon surrender
for cancellation of any one or more temporary Warrant Certificates the Company
shall execute and the Warrant Agent shall authenticate and deliver in exchange
therefor definitive Warrant Certificates representing the same aggregate number
of Warrants. Until so exchanged, the temporary Warrant Certificates shall in all
respects be entitled to the same benefits under this Agreement as definitive
Warrant Certificates.
Section 1.05. Payment of Taxes. The Company will pay all stamp
taxes and other duties, if any, to which, under the laws of the United States of
America or any State or political subdivision thereof, this Agreement or the
original issuance of the Warrant Certificates may be subject; provided, however,
that the Company shall not be required to pay any tax or other governmental
charge which may be payable in respect of any transfer involving any beneficial
or of record interest in or ownership interest of any Warrant.
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<PAGE> 7
Section 1.06. Definition of Holder. The term "Holder" as used
herein shall mean [If Offered Debt Securities and Warrants which are not
immediately detachable --, prior to the Detachable Date, the registered owner of
the Offered Debt Security to which such Warrant Certificate was initially
attached, and, after such Detachable Date,] the person in whose name at the time
such Warrant Certificate shall be registered upon the books to be maintained by
the Warrant Agent for that purpose pursuant to Section 3.01]. [If Offered Debt
Securities and Warrants which are not immediately detachable -- prior to the
Detachable Date, the Company will, or will cause the registrar of the Offered
Debt Securities to, make available to the Warrant Agent current information as
to Holders of the Offered Debt Securities.]
ARTICLE II
WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS
Section 2.01. Warrant Price.(1) During the period from
___________, 19__ through and including ___________, 19__, each Warrant shall
entitle the Holder thereof, subject to the provisions of this Agreement, to
purchase from the Company the principal amount of Warrant Debt Securities stated
in the Warrant Certificate at the exercise price of ___% of the principal amount
thereof [plus accrued amortization, if any, of the original issue discount of
the Warrant Debt Securities] [plus accrued interest, if any, from the most
recent date from which interest shall have been paid on the Warrant Debt
Securities or, if no interest shall have been paid on the Warrant Debt
Securities, from _____________, 19__].
[In each case, the original issue discount ($_______ for each
$1,000 principal amount of Warrant Debt Securities) will be amortized at a __%
annual rate, computed on a[n] [semi-] annual basis [using a 360-day year
consisting of twelve 30-day months].] Such exercise price of each Warrant is
referred to in this Agreement as the "Exercise Price."
Section 2.02. Duration of Warrants. Any Warrant evidenced by a
Warrant Certificate may be exercised at any time, as specified herein, on or
after [the date thereof]] ___________, 19__] and at or before the close of
business on ___________, 19__ or such later date as the Company may designate in
writing to the Warrant Agent, with notice to the Holders (the "Expiration
Date"). Each Warrant not exercised at or before the close of business on the
Expiration Date shall become void, and all rights of
- --------
(1) Complete and modify the provisions of this Section as appropriate to
reflect the exact terms of the Warrants and the Warrant Debt
Securities.
-4-
<PAGE> 8
the Holder of the Warrant Certificate evidencing such Warrant under this
Agreement or otherwise shall cease.
Section 2.03. Exercise of Warrants. (a) During the period
specified in Section 2.02, any whole number of Warrants may be exercised by
surrendering the Warrant Certificate evidencing such Warrants at the place or at
the places set forth in the Warrant Certificate, with the purchase form set
forth in the Warrant Certificate duly executed, accompanied [by payment in full,
in lawful money of the United States of America, [in cash or by certified check
or official bank check in New York Clearing House funds]] [by surrender of the
[specified aggregate amount of [identified securities]] [by bank wire transfer
in immediately available funds], of the Exercise Price for each Warrant
exercised. The date on which payment in full of the Exercise Price for a Warrant
and the duly executed and completed Warrant Certificate are received by the
Warrant Agent shall be deemed to be the date on which such Warrant is exercised.
The Warrant Agent shall deposit all funds received by it as payment for the
exercise of Warrants to the account of the Company maintained with it for such
purpose and shall advise the Company by telephone at the end of each day on
which such a payment is received of the amount so deposited to its account. The
Warrant Agent shall promptly confirm such telephonic advice to the Company in
writing.
(b) The Warrant Agent shall from time to time, as promptly as
practicable after the exercise of any Warrants in accordance with the terms and
conditions of this Agreement and the Warrant Certificates, advise the Company
and the Trustee of (i) the number of Warrants so exercised, (ii) the
instructions of each Holder of the Warrant Certificates evidencing such Warrants
with respect to delivery of the Warrant Debt Securities to which such Holder is
entitled upon such exercise, and instructions of such Holder as to delivery of
Warrant Certificates evidencing the balance, if any, of the Warrants remaining
after such exercise, and (iii) such other information as the Company or the
Trustee shall reasonably require.
(c) As soon as practicable after the exercise of any Warrants,
the Company shall issue, pursuant to the Indenture, in authorized denominations,
to or upon the order the Holder of the Warrant Certificate evidencing such
Warrants, the Warrant Debt Security or Warrant Debt Securities to which such
Holder is entitled in fully registered form, registered in such name or names as
may be directed by such Holder; and, if fewer than all of the Warrants evidenced
by such Warrant Certificate were exercised, the Company shall execute and an
authorized officer of the Warrant Agent shall manually authenticate and deliver
a new Warrant Certificate evidencing the number of Warrants remaining
unexercised.
(d) The Company shall not be required to pay any stamp or
other tax or other governmental charge required to be paid in connection with
any transfer involved
-5-
<PAGE> 9
in the issue of the Warrant Debt Securities; and in the event that any such
transfer is involved, the Company shall not be required to issue or deliver any
Warrant Debt Securities until such tax or other charge shall have been paid or
it has been established to the Company's satisfaction that no such tax or other
charge is due.
ARTICLE III
REGISTRATION, EXCHANGE, TRANSFER AND
SUBSTITUTION OF WARRANT CERTIFICATES
Section 3.01. Registration, Exchange and Transfer of Warrant
Certificates. The Warrant Agent shall keep, at its corporate trust office [and
at _________], books in which, subject to such reasonable regulations as it may
prescribe, it shall register Warrant Certificates and transfers of outstanding
Warrant Certificates.
[If Offered Debt Securities and Warrants which are not
immediately detachable -- Prior to the Detachable Date, a Warrant Certificate
may be exchanged or transferred only together with the Offered Debt Security to
which such Warrant Certificate was initially attached, and only for the purpose
of effecting, or in conjunction with, an exchange or transfer of such Offered
Debt Security. Additionally, on or prior to the Detachable Date, each transfer
or exchange of an Offered Debt Security on the register of the Offered Debt
Securities shall operate also to transfer or exchange the Warrant Certificate or
Certificates to which such Offered Debt Security was initially attached. After
the Detachable Date, upon] [If Offered Debt Securities and Warrants which are
immediately detachable or if Warrants alone -- Upon] surrender at the corporate
trust office of the Warrant Agent [or ________________] of Warrant Certificates
properly endorsed [or accompanied by appropriate instruments of transfer] and
accompanied by written instructions for [transfer or] exchange, all in form
reasonably satisfactory to the Company and the Warrant Agent, such Warrant
Certificates may be exchanged for other Warrant Certificates or may be
transferred in whole or in part; provided that Warrant Certificates issued in
exchange for [or upon transfer of] surrendered Warrant Certificates shall
evidence the same aggregate number of Warrants as the Warrant Certificates so
surrendered. No service charge shall be made for any exchange [or transfer] of
Warrant Certificates, but the Company may require payment of a sum sufficient to
cover any stamp or other tax or governmental charge that may be imposed in
connection with any such exchange [or transfer]. Whenever any Warrant
Certificates are so surrendered for exchange [or transfer], the Company shall
execute and an authorized officer of the Warrant Agent shall manually
authenticate and deliver to the person or persons entitled thereto a Warrant
Certificate or Warrant Certificates as so requested. The Warrant Agent shall not
be required to effect any exchange [or transfer] which would result in the
issuance of a Warrant Certificate evidencing a fraction of a
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<PAGE> 10
Warrant or a number of full Warrants and a fraction of a Warrant. All Warrant
Certificates issued upon any exchange [or transfer] of Warrant Certificates
shall evidence the same obligations, and be entitled to the same benefits under
this Agreement, as the Warrant Certificate surrendered for such exchange [or
transfer].
Section 3.02. Mutilated, Destroyed, Lost or Stolen Warrant
Certificates. If any mutilated Warrant Certificate is surrendered to the Warrant
Agent, the Company shall execute and an officer of the Warrant Agent shall
manually authenticate and deliver in exchange therefor a new Warrant Certificate
of like tenor and principal amount and bearing a number not contemporaneously
outstanding. If there shall be delivered to the Company and the Warrant Agent
(i) evidence to their reasonable satisfaction of the destruction, loss or theft
of any Warrant Certificate and of the ownership thereof and (ii) such security
or indemnity as may be required by them to save each of them and any agent of
either of them harmless, then, in the absence of notice to the Company or the
Warrant Agent that such Warrant Certificate has been acquired by a bona fide
purchaser, the Company shall execute and upon its request an officer of the
Warrant Agent shall manually authenticate and deliver, in lieu of any such
destroyed, lost or stolen Warrant Certificate, a new Warrant Certificate of like
tenor and principal amount and bearing a number not contemporaneously
outstanding. Upon the issuance of any new Warrant Certificate 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 Warrant Agent) connected
therewith. Every new Warrant Certificate issued pursuant to this Section in lieu
of any destroyed, lost or stolen Warrant Certificate shall evidence an original
additional contractual obligation of the Company, whether or not the destroyed,
lost or stolen Warrant Certificate shall be at any time enforceable by anyone,
and shall be entitled to all the benefits of this Agreement equally and
proportionately with any and all other Warrant Certificates duly issued
hereunder. The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Warrant Certificates.
Section 3.03. Persons Deemed Owners. [If Offered Debt
Securities and Warrants which are not immediately detachable -- Prior to the
Detachable Date, the Company, the Warrant Agent and all other persons may treat
the registered owner of any Offered Debt Security as the owner of the Warrant
Certificates initially attached thereto for any purpose and as the person
entitled to exercise the rights represented by the Warrants evidenced by such
Warrant Certificates, any notice to the contrary notwithstanding. After the
Detachable Date] and prior to due presentment of a Warrant Certificate for
registration of transfer, the [If Offered Debt Securities and Warrants which are
immediately detachable or Warrants alone -- The] Company, the Warrant Agent and
all other persons may treat the Holder as the owner thereof for any purpose and
as the
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<PAGE> 11
person entitled to exercise the rights represented by the Warrants evidenced
thereby, any notice to the contrary notwithstanding.
Section 3.04. Cancellation of Warrant Certificates. Any
Warrant Certificate surrendered for exchange[, transfer] or exercise of the
Warrants evidenced thereby shall, if surrendered to the Company, be delivered to
the Warrant Agent, and all Warrant Certificates surrendered or so delivered to
the Warrant Agent shall be promptly cancelled by it and shall not be reissued
and, except as expressly permitted by this Agreement, no Warrant Certificate
shall be issued hereunder in lieu or in exchange thereof. The Company may at any
time deliver to the Warrant Agent for cancellation any Warrant Certificates
previously issued hereunder which the Company may have acquired in any manner
whatsoever, and all Warrant Certificates so delivered shall be promptly
cancelled by the Warrant Agent. All cancelled Warrant Certificates held by the
Warrant Agent shall be disposed of as instructed by the Company, subject to
applicable law.
ARTICLE IV
OTHER PROVISIONS RELATING TO RIGHTS
OF HOLDERS OF WARRANT CERTIFICATES
Section 4.01. No Rights as Holders of Warrant Debt Securities
Conferred by Warrants or Warrant Certificates. No Warrant Certificate or Warrant
evidenced thereby shall entitle the Holder thereof to any of the rights of a
Holder of the Warrant Debt Securities, including, without limitation, the right
to receive the payment of principal of (or premium, if any) or interest, if any,
on the Warrant Debt Securities or to enforce any of the covenants in the
Indenture.
Section 4.02. Holder of Warrant Certificate May Enforce
Rights. Notwithstanding any of the provisions of this Agreement, any Holder of
any Warrant Certificate, without the consent of the Warrant Agent, the Trustee,
the holder of any Warrant Debt Securities or the Holder of any other Warrant
Certificate, may, on his own behalf and for his own benefit enforce, and may
institute and maintain any suit, action or proceeding against the Company
suitable to enforce or otherwise in respect of, his right to exercise the
Warrant or Warrants evidenced by his Warrant Certificate in the manner provided
in the Warrant Certificates and in this Agreement.
ARTICLE V
CONCERNING THE WARRANT AGENT
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<PAGE> 12
Section 5.01. Warrant Agent. The Company hereby appoints
________ as Warrant Agent of the Company in respect of the Warrants and the
Warrant Certificates upon the terms and subject to the conditions herein set
forth, and _________ hereby accepts such appointment. The Warrant Agent shall
have the power and authority granted to and conferred upon it in the Warrant
Certificates and hereby and such further power and authority to act on behalf of
the Company as the Company may hereafter grant to or confer upon it. All of the
terms and provisions with respect to such power and authority contained in the
Warrant Certificates are subject to and governed by the terms and provisions
hereof.
Section 5.02. Conditions of Warrant Agent's Obligations. The
Warrant Agent accepts its obligations herein set forth, upon the terms and
conditions hereof, including the following, to all of which the Company agrees
and to all of which the rights hereunder of the Holders from time to time of the
Warrant Certificates shall be subject:
(a) Compensation and Indemnification. The Company agrees
promptly to pay the Warrant Agent the compensation to be agreed upon
with the Company for all services rendered by the Warrant Agent and to
reimburse the Warrant Agent for reasonable out-of-pocket expenses
(including counsel fees) incurred by the Warrant Agent in connection
with the services rendered hereunder by the Warrant Agent. The Company
also agrees to indemnify the Warrant Agent for, and to hold it harmless
against, any loss, liability or expense incurred without negligence or
bad faith on the part of the Warrant Agent, arising out of or in
connection with its acting as such Warrant Agent hereunder, including
the reasonable costs and expenses of defending itself against any claim
or liability in connection with the exercise or performance at any time
of its powers or duties hereunder. The obligations of the Company under
this subsection (a) shall survive the exercise of the Warrant
Certificates and the resignation or removal of the Warrant Agent.
(b) Agent for the Company. In acting under this Warrant
Agreement and in connection with the Warrant Certificates, the Warrant
Agent is acting solely as agent of the Company and does not assume any
obligation or relationship of agency or trust for or with any of the
owners or Holders of the Warrant Certificates.
(c) Counsel. The Warrant Agent may consult with counsel, which
may include counsel for the Company, and the written advice of such
counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in
good faith and in reliance thereon.
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<PAGE> 13
(d) Documents. The Warrant Agent shall be protected and shall
incur no liability for or in respect of any action taken or omitted by
it in reliance upon any notice, direction, consent, certificate,
affidavit, statement or other paper or document reasonably believed by
it to be genuine and to have been presented or signed by the proper
parties.
(e) Certain Transactions. The Warrant Agent, any of its
officers, directors and employees, or any other agent of the Company,
in its individual or any other capacity, may become the owner of, or
acquire any interest in, any Warrant Certificates, with the same rights
that it would have if it were not such Warrant Agent, officer,
director, employee or other agent, and, to the extent permitted by
applicable law, it may engage or be interested in any financial or
other transaction with the Company and may act on, or as depositary,
trustee or agent for, any committee or body of holders of Warrant Debt
Securities or other obligations of the Company as freely as if it were
not such Warrant Agent, officer, director, employee or other agent.
Nothing in this Warrant Agreement shall be deemed to prevent the
Warrant Agent from acting as Trustee under the Indenture.
(f) No Liability for Interest. The Warrant Agent shall not be
under any liability for interest on any monies at any time received by
it pursuant to any of the provisions of this Agreement or of the
Warrant Certificates unless otherwise agreed to in writing by the
Company and the Warrant Agent.
(g) No Liability for Invalidity. The Warrant Agent shall not
incur any liability with respect to the validity of this Agreement or
any of the Warrant Certificates.
(h) No Responsibility for Representations. The Warrant Agent
shall not be responsible for any of the recitals or representations
contained herein or in the Warrant Certificates (except as to the
Warrant Agent's Certificate of Authentication thereon), all of which
are made solely by the Company.
(i) No Implied Obligations. The Warrant Agent shall be
obligated to perform such duties as are herein and in the Warrant
Certificates specifically set forth and no implied duties or
obligations shall be read into this Agreement or the Warrant
Certificates against the Warrant Agent. The Warrant Agent shall not be
under any obligation to take any action hereunder which may tend to
involve it in any expense or liability, the payment of which within a
reasonable time is not, in its reasonable opinion, assured to it. The
Warrant Agent shall not be accountable or under any duty or
responsibility for the use by the Company of any of the Warrant
Certificates authenticated by the Warrant Agent and delivered by it to
the Company pursuant to this Agreement or for the application by the
Company of
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<PAGE> 14
the proceeds of the Warrant Certificates or any exercise of the
Warrants evidenced thereby. The Warrant Agent shall have no duty or
responsibility in case of any default by the Company in the performance
of its covenants or agreements contained herein or in the Warrant
Certificates or in the Warrant Debt Securities or in the case of the
receipt of any written demand from a Holder of a Warrant Certificate
with respect to such default, including, without limiting the
generality of the foregoing, any duty or responsibility to initiate or
attempt to initiate any proceeding at law or otherwise or, except as
provided in Section 6.04 hereof, to make any demand upon the Company.
Section 5.03. Resignation, Removal and Appointment of
Successor.
(a) The Company agrees, for the benefit of the Holders from
time to time of the Warrant Certificates, that there shall at all times be a
Warrant Agent hereunder until all of the Warrant Certificates are no longer
exercisable.
(b) The Warrant Agent may at any time resign as such agent by
giving written notice to the Company of such intention on its part, specifying
the date on which it desires its resignation to become effective; provided that,
without the consent of the Company, such date shall not be less than three
months after the date on which such notice is given. The Warrant Agent hereunder
may be removed at any time by the filing with it of an instrument in writing
signed by or on behalf of the Company and specifying such removal and the date
on which the Company expects such removal to become effective. Such resignation
or removal shall take effect upon the appointment by the Company of a successor
Warrant Agent (which shall be a bank or trust company organized and doing
business under the laws of the United States of America, any State thereof or
the District of Columbia and authorized under such laws to exercise corporate
trust powers) by an instrument in writing filed with such successor Warrant
Agent and the acceptance of such appointment by such successor Warrant Agent
pursuant to Section 5.03(d).
(c) In case at any time the Warrant Agent shall resign, or be
removed, or shall become incapable of acting, or shall be adjudged bankrupt or
insolvent, or shall file a voluntary petition in bankruptcy or make an
assignment for the benefit of its creditors or consent to the appointment of a
receiver or custodian of all or any substantial part of its property, or shall
admit in writing its inability to pay or meet its debts as they mature, or if a
receiver or custodian of it or of all or any substantial part of its property
shall be appointed or if an order of any court shall be entered approving any
petition filed by or against it under the provisions of any applicable
bankruptcy or similar law, or if any public officer shall have taken charge or
control of the Warrant Agent or of its property or affairs, a successor Warrant
Agent, qualified as aforesaid, shall be appointed by the Company by an
instrument in writing, filed with the successor Warrant Agent. Upon the
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<PAGE> 15
appointment as aforesaid of a successor Warrant Agent and acceptance by the
latter of such appointment, the Warrant Agent so superseded shall cease to be
Warrant Agent hereunder.
(d) Any successor Warrant Agent appointed hereunder shall
execute, acknowledge and deliver to its predecessor and to the Company an
instrument accepting such appointment hereunder, and thereupon such successor
Warrant Agent, without any further act, deed or conveyance, shall become vested
with all the authority, rights, powers, trusts, immunities, duties and
obligations of such predecessor with like effect as if originally named as
Warrant Agent hereunder, and such predecessor, upon payment of its charges and
disbursements then unpaid, shall thereupon become obligated to transfer, deliver
and pay over, and such successor Warrant Agent shall be entitled to receive all
monies, securities and other property on deposit with or held by such
predecessor, as Warrant Agent hereunder.
(e) A corporation into which the Warrant Agent hereunder may
be merged or converted or any corporation with which the Warrant Agent may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Warrant Agent shall be a party, or any corporation
succeeding to all or substantially all the corporate trust business of the
Warrant Agent, provided that it shall be qualified as aforesaid, shall be the
successor Warrant Agent under this Agreement without the execution or filing of
any paper or any further act on the part of any of the parties hereto.
(f) The Company may designate agencies for the surrender for
exercise of Warrant Certificates at such place or places as the Company may
determine, and the Company shall keep the Warrant Agent advised of the names and
locations of such agencies, if any are so designated. The Warrant Agent shall
arrange directly with such agencies for the delivery of Warrant Debt Securities
upon exercise of Warrant Certificates surrendered for exercise at such agencies.
The Warrant Agent shall be in no way responsible or accountable for the action
or failure to act of any agencies designated pursuant to this Section 5.03(f).
Section 5.04. Compliance With Applicable Laws. The Warrant
Agent agrees to comply with all applicable federal and state laws in respect of
the services rendered by it under this Warrant Agreement and in connection with
the Warrants, including (but not limited to) the provisions of United States
federal income tax laws regarding information reporting and backup withholding.
The Warrant Agent expressly assumes all liability for failure to comply with
such laws, including (but not limited to) any liability for failure to comply
with any applicable provisions of United States federal income tax laws
regarding information reporting and backup holding.
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<PAGE> 16
ARTICLE VI
MISCELLANEOUS
Section 6.01. Consolidations and Mergers of the Company and
Sales, Leases and Conveyances Permitted Subject to Certain Conditions. To the
extent permitted in the Indenture, the Company may consolidate with, or sell or
convey all or substantially all of its assets to, or merge with or into any
other corporation.
Section 6.02. Rights and Duties of Successor Corporation. In
case of any such consolidation, merger, sale, lease or conveyance and upon any
such assumption by the successor corporation, such successor corporation shall
succeed to and be substituted for the Company, with the same effect as if it had
been named herein, and the predecessor corporation, except in the event of a
lease, shall be relieved of any further obligation under this Agreement and the
Warrants. Such successor corporation thereupon may cause to be signed, and may
issue either in its own name or in the name of the Company, any or all of the
Warrant Debt Securities issuable pursuant to the terms hereof. All the Warrant
Debt Securities so issued shall in all respects have the same legal rank and
benefit under the Indenture as the Warrant Debt Securities theretofore or
thereafter issued in accordance with the terms of this Agreement and the
Indenture.
In case of any such consolidation, merger, sale, lease or
conveyance, such changes in phraseology and form (but not in substance) may be
made in the Warrant Debt Securities thereafter to be issued as may be
appropriate.
Section 6.03. Amendment. (a) This Agreement may be amended by
the parties hereto, without the consent of the Holder of any Warrant
Certificate, for the purpose of curing any ambiguity, or of curing, correcting
or supplementing any defective provision contained herein, or making such
provisions in regard to matters or questions arising under this Agreement as the
Company may deem necessary or desirable; provided that such action shall not
adversely affect the interests of the Holders of the Warrant Certificates in any
material respect. The Warrant Agent may, but shall not be obligated to, enter
into any amendment to this Agreement which affects the Warrant Agent's own
rights, duties or immunities under this Agreement or otherwise.
(b) The Company and the Warrant Agent may modify or amend this
Agreement and the Warrant Certificate, with the consent of the Owners of not
fewer than a majority in number of the then outstanding unexercised Warrants
affected by such modification or amendment, for any purpose; provided, however,
that no such modification or amendment that increases the Exercise Price or
shortens the period of time during which the Warrants may be exercised, or
otherwise materially and adversely affects the exercise rights of the Owners or
reduces the number of outstanding Warrants
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<PAGE> 17
the consent of the Owners of which is required for modification or amendment of
this Agreement or the Warrant Certificate, may be made without the consent of
each Owner affected thereby.
Section 6.04. Notice and Demands to the Company and Warrant
Agent. If the Warrant Agent shall receive any notice or demand addressed to the
Company by the Holder of a Warrant Certificate pursuant to the provisions of the
Warrant Certificates, the Warrant Agent shall promptly forward such notice or
demand to the Company.
Section 6.05. Notices to Holders of Warrant Certificates. Any
notice to holders of Warrant Certificates which by any provisions of this
Warrant Agreement is required or permitted to be given by first class mail
postage prepaid at such holder's address as it appears on the books of the
Warrant Agent [or on the register of the Offered Debt Securities prior to the
Detachable Date].
Section 6.06. Addresses. Any communications from the Company
to the Warrant Agent with respect to this Agreement shall be addressed to
_________________ Attention: _________________ and any communications from the
Warrant Agent, to the Company with respect to this Agreement shall be addressed
to Pharmacia & Upjohn, Inc., 95 Corporate Drive, Bridgewater, New Jersey 08807,
Attention: Don W. Schmitz, Esq. (or such other address as shall be specified in
writing by the Warrant Agent or by the Company).
Section 6.07. Governing Law. This Agreement and each Warrant
Certificate issued hereunder shall be governed by and construed in accordance
with the laws of the State of New York.
Section 6.08. Delivery of Prospectus. The Company will furnish
to the Warrant Agent sufficient copies of a prospectus, appropriately
supplemented, relating to the Warrant Debt Securities (the "Prospectus"), and
the Warrant Agent agrees that, upon the exercise of any Warrant Certificate, the
Warrant Agent will deliver to the person designated to receive Warrant Debt
Securities, prior to or concurrently with the delivery of such Securities, a
Prospectus.
Section 6.09. Obtaining of Governmental Approvals. The Company
will from time to time take all action which may be necessary to obtain and keep
effective any and all permits, consents and approvals of governmental agencies
and authorities and securities acts filings under United States Federal and
State laws (including, without limitation, the maintenance of the effectiveness
of a registration statement in respect of the Warrant Debt Securities under the
Securities Act of 1933), which may be or become required in connection with
exercise of the Warrant Certificates and the original issuance and delivery of
the Warrant Debt Securities.
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<PAGE> 18
Section 6.10. Persons Having Rights Under Warrant Agreement.
Nothing in this Agreement expressed or implied and nothing that may be inferred
from any of the provisions hereof is intended, or shall be construed, to confer
upon, or give to, any person or corporation other than the Company, the Warrant
Agent and the Holders of the Warrant Certificates any right, remedy or claim
under or by reason of this Agreement or of any covenant, condition, stipulation,
promise or agreement hereof; and all covenants, conditions, stipulations,
promises and agreements in this Agreement contained shall be for the sole and
exclusive benefit of the Company and the Warrant Agent and their successors and
of the Holders of the Warrant Certificates.
Section 6.11. Headings. The Article and Section headings
herein and the Table of Contents are for convenience of reference only and shall
not affect the construction hereof.
Section 6.12. Counterparts. This Agreement may be executed in
any number of counterparts, each of which so executed shall be deemed to be an
original; but such counterparts shall together constitute but one and the same
instrument.
Section 6.13. Inspection of Agreement. A copy of this
Agreement shall be available at all reasonable times at the principal corporate
trust office of the Warrant Agent [and at ___________] for inspection by the
Holder of any Warrant Certificate. The Warrant Agent may require such Holder to
submit his Warrant Certificate for inspection by it.
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<PAGE> 19
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed, and their respective corporate seal to be
hereunto affixed and attested, all as of the day and year first above written.
PHARMACIA & UPJOHN, INC.
By__________________________________
[SEAL]
Attest:
______________________
[NAME OF WARRANT AGENT]
By__________________________________
[SEAL]
Attest:
_______________________
[Assistant Secretary]
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<PAGE> 20
[FORM OF WARRANT CERTIFICATE]
[Face]
Form of Legend if Offered Debt Securities with Warrants which are not
immediately detachable:
[Prior to ___________, this Warrant Certificate may be transferred or exchanged
if and only if the [Title of Offered Debt Security] to which it was initially
attached is so transferred or exchanged.]
Form of Legend if Warrants are not immediately exercisable:
[Prior to _________________, Warrants evidenced by this Warrant Certificate
cannot be exercised.]
EXERCISABLE ONLY IF AUTHENTICATED BY THE WARRANT
AGENT AS PROVIDED HEREIN
VOID AFTER THE CLOSE OF BUSINESS ON ________________, 19__
PHARMACIA & UPJOHN, INC.
Warrant Certificate representing
Warrants to purchase
[Title of Warrant Debt Securities]
as described herein
_______________________________
No. _______________ Warrants
This certifies that _____________ or registered assigns is the
registered owner of the above indicated number of Warrants, each Warrant
entitling such registered owner to purchase, at any time [after the close of
business on ____________, 19__, and] on or before the close of business on
_____________, 19__, $___________ principal amount of [Title of Warrant Debt
Securities] (the "Warrant Debt Securities") of Pharmacia & Upjohn, Inc. (the
"Company") issued or to be issued under the Indenture (as
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<PAGE> 21
hereinafter defined), on the following basis.* [During the period from
____________, 19__ through and including _________, 19__,] each Warrant shall
entitle the Holder thereof, subject to the provisions of this Agreement, to
purchase from the Company the principal amount of Warrant Debt Securities stated
above in this Warrant Certificate at the exercise price of __% of the principal
amount thereof [plus accrued amortization, if any, of the original issue
discount of the Warrant Debt Securities] [plus accrued interest, if any, from
the most recent date from which interest shall have been paid on the Warrant
Debt Securities or, if no interest shall have been paid on the Warrant Debt
Securities, from __________, 19__]; [in each case, the original issue discount
($_________ for each $1,000 principal amount of Warrant Debt Securities) will be
amortized at a __% annual rate, computed on a[n] [semi-]annual basis[, using a
360-day year consisting of twelve 30-day months] [(the "Exercise Price")]. The
Holder of this Warrant Certificate may exercise the Warrants evidenced hereby,
in whole or in part, by surrendering this Warrant Certificate, with the purchase
form set forth hereon duly completed, accompanied [by payment in full, in lawful
money of the United States of America, [in cash or by certified check or
official bank check in New York Clearing House funds] [by bank wire transfer in
immediately available funds]] [by surrender of the [specified aggregate
principal amount of [identified securities]], the Exercise Price for each
Warrant exercised, to the Warrant Agent (as hereinafter defined), at the
corporate trust office of [name of Warrant Agent], or its successor as warrant
agent (the "Warrant Agent") [or at ______,] at the addresses specified on the
reverse hereof and upon compliance with and subject to the conditions set forth
herein and in the Warrant Agreement (as hereinafter defined). This Warrant
Certificate may be exercised only for the purchase of Warrant Debt Securities in
the principal amount of [$1,000] or any integral multiple thereof.
The term "Holder" as used herein shall mean [If Offered Debt
Securities and Warrants which are not immediately detachable --, prior to
__________, 19__ (the "Detachable Date"), the registered owner of the Company's
[title of Offered Debt Securities] to which such Warrant Certificate was
initially attached, and after such Detachable Date,] the person in whose name at
the time such Warrant Certificate shall be registered upon the books to be
maintained by the Warrant Agent for that purpose pursuant to Section 3.01 of the
Warrant Agreement.
Any whole number of Warrants evidenced by this Warrant
Certificate may be exercised to purchase Warrant Debt Securities in registered
form. Upon any exercise of fewer than all of the Warrants evidenced by this
Warrant Certificate, there shall be issued to the registered owner hereof a new
Warrant Certificate evidencing the number of Warrants remaining unexercised.
- --------
* Complete and modify the following provisions as appropriate to reflect
the terms of the Warrants and the Warrant Debt Securities.
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<PAGE> 22
This Warrant Certificate is issued under and in accordance
with the Warrant Agreement dated as of ________, 19__ (the "Warrant Agreement"),
between the Company and the Warrant Agent and is subject to the terms and
provisions contained in the Warrant Agreement, to all of which terms and
provisions the Holder of this Warrant Certificate consents by acceptance hereof.
Copies of the Warrant Agreement are on file at the above-mentioned office of the
Warrant Agent [and at _____________].
The Warrant Debt Securities to be issued and delivered upon
the exercise of Warrants evidenced by this Warrant Certificate will be issued
under and in accordance with an Indenture, dated as of _______________________
(the "Indenture"), as supplemented from time to time, between the Company and
_______________, a [corporation] [national banking association] organized under
the laws of the State of ___________, as trustee (such trustee, and any
successors to such trustee, the "Trustee") and will be subject to the terms and
provisions contained in the Warrant Debt Securities and in the Indenture. Copies
of the Indenture, including the form of the Warrant Debt Securities, are on file
at the corporate trust office of the Trustee [and at ____________
______________________].
[If Offered Debt Securities and Warrants which are not
immediately detachable -- Prior to ____________, 19__ (the "Detachable Date"),
this Warrant Certificate may be exchanged or transferred only together with the
[title of Offered Debt Security] (the "Offered Debt Security") to which this
Warrant Certificate was initially attached, and only for the purpose of
effecting, or in conjunction with, an exchange or transfer of such Offered Debt
Security. Additionally, on or prior to the Detachable Date, each transfer of
such Offered Debt Security on the register of the Offered Debt Securities shall
operate also to transfer this Warrant Certificate. After the Detachable Date,
this] [If Offered Debt Securities and Warrants which are immediately detachable
or Warrants alone -- This] Warrant Certificate, and all rights hereunder, may be
transferred when surrendered at the corporate trust office of the Warrant Agent
[or __________] by the registered owner or his assigns, in person or by an
attorney duly authorized in writing, in the manner and subject to the
limitations provided in the Warrant Agreement.
[If Offered Debt Securities and Warrants which are not
immediately detachable -- Except as provided in the immediately preceding
paragraph, after] [If Offered Debt Securities and Warrants which are immediately
detachable or Warrants alone -- After] authentication by the Warrant Agent and
prior to the expiration of this Warrant Certificate, this Warrant Certificate
may be exchanged at the corporate trust office of the Warrant Agent [or at
________________] for Warrant Certificates representing the same aggregate
number of Warrants.
This Warrant Certificate shall not entitle the registered
owner hereof to any of the rights of a registered holder of the Warrant Debt
Securities, including, without
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<PAGE> 23
limitation, the right to receive payments of principal of (and premium, if any)
or interest, if any, on the Warrant Debt Securities or to enforce any of the
covenants of the Indenture.
Reference is hereby made to the further provisions of this
Warrant Certificate set forth on the reverse hereof, which further provisions
shall for all purposes have the same effect as if set forth at this place.
This Warrant Certificate shall not be valid or obligatory for
any purpose until authenticated by the Warrant Agent.
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<PAGE> 24
IN WITNESS WHEREOF, the Company has caused this Warrant
Certificate to be duly executed under its corporate seal.
Dated:______________
PHARMACIA & UPJOHN, INC.
By__________________________________
Attest:
______________________
Certificate of Authentication
This is one of the Warrant Certificates referred to in the
within-mentioned Warrant Agreement.
_________________________
As Warrant Agent
By____________________________________
Authorized Signature
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<PAGE> 25
[REVERSE] [FORM OF WARRANT CERTIFICATE]
(Instructions for Exercise of Warrants)
To exercise any Warrants evidenced hereby, the Holder of this
Warrant Certificate must pay [in cash or by certified check or official bank
check in New York Clearing House funds or by bank wire transfer in immediately
available funds], the Exercise Price in full for each of the Warrants exercised,
to ____________, Corporate Trust Department, ___________, Attn: ____________ [or
____________], which payment should specify the name of the Holder of this
Warrant Certificate and the number of Warrants exercised by such Holder. In
addition, the Holder of this Warrant Certificate should complete the information
required below and present in person or mail by registered mail this Warrant
Certificate to the Warrant Agent at the addresses set forth below.
[FORM OF EXERCISE]
(To be executed upon exercise of Warrants.)
The undersigned hereby irrevocably elects to exercise
_________ Warrants, represented by this Warrant Certificate, to purchase
$_________ principal amount of the [Title of Warrant Debt Securities] (the
"Warrant Debt Securities") of Pharmacia & Upjohn, Inc. and represents that he
has tendered payment for such Warrant Debt Securities [in cash or by certified
check or official bank check in New York Clearing House funds or by bank wire
transfer in immediately available funds] to the order of Pharmacia & Upjohn,
Inc., c/o: Treasurer in the amount of $___________ in accordance with the terms
hereof. The undersigned requests that said principal amount of Warrant Debt
Securities be in fully registered form, in the authorized denominations,
registered in such names and delivered, all as specified in accordance with the
instructions set forth below.
If said principal amount of Warrant Debt Securities is less
than all of the Warrant Debt Securities purchasable hereunder, the undersigned
requests that a new Warrant Certificate representing the remaining balance of
the Warrants evidenced hereby be issued and delivered to the undersigned unless
otherwise specified in the instructions below.
Dated:
Name___________________________
(Please Print)
________________________________
(Insert Social Security or Other
Identifying Number of Holder) Address________________________
________________________
<PAGE> 26
Signature ____________________ (Signature
must conform in all respects to name of
holder as specified on the face of this
Warrant Certificate and must bear a
signature guaranteed by a bank, trust
company or member broker of the New York
Stock Exchange or other national stock
exchange.)
This Warrant may be exercised at the following addresses:
By hand at___________________________
___________________________
___________________________
___________________________
By mail at___________________________
___________________________
___________________________
___________________________
(Instructions as to form and delivery of Warrant Debt Securities and/or Warrant
Certificates):
<PAGE> 27
[FORM OF ASSIGNMENT]
(TO BE EXECUTED TO TRANSFER
THE WARRANT CERTIFICATE)
FOR VALUE RECEIVED _____________ hereby sells, assigns and
transfers unto
Please insert social security
or other identifying number
___________________________
___________________________
(Please print name and address
including zip code)
________________________________________________________________________________
the right represented by the within Warrant Certificate and does hereby
irrevocably constitute and appoint __________ Attorney, to transfer said Warrant
Certificate on the books of the Warrant Agent with full power of substitution.
Dated:
____________________________________________
Signature
(Signature must conform in all respects to
name of holder as specified on the face of
this Warrant Certificate and must bear a
signature guaranteed by a bank, trust
company or member broker of the New York or
Midwest Stock Exchange)
Signature Guaranteed:
______________________________]
<PAGE> 1
EXHIBIT 5
July 13, 1999
Pharmacia & Upjohn, Inc.,
95 Corporate Drive,
Bridgewater, New Jersey 08807.
Dear Sirs:
In connection with the registration under the Securities Act
of 1933 (the "Act") of (i) debt securities ("Debt Securities"), (ii) debt
warrants ("Debt Warrants"), (iii) preferred stock ("Preferred Stock") and (iv)
common stock ("Common Stock", and collectively with the Debt Securities, Debt
Warrants and Preferred Stock, the "Securities") of Pharmacia & Upjohn, Inc., a
Delaware corporation (the "Company"), with an aggregate initial public offering
price of up to $1,000,000,000, we, as your counsel, have examined such corporate
records, certificates and other documents, and such questions of law, as we have
considered necessary or appropriate for the purposes of this opinion.
Upon the basis of such examination, we advise you that, in our
opinion:
<PAGE> 2
Pharmacia & Upjohn, Inc. -2-
(1) With respect to the Debt Securities, when the Registration
Statement has become effective under the Act, the Indenture relating to
the Debt Securities has been duly authorized, executed and delivered,
the terms of the Debt Securities and of their issuance and sale have
been duly established in conformity with the Indenture so as not to
violate any applicable law or result in a default under or breach of
any agreement or instrument binding upon the Company and so as to
comply with any requirement or restriction imposed by any court or
governmental body having jurisdiction over the Company, and the Debt
Securities have been duly executed and authenticated in accordance with
the Indenture and issued and sold as contemplated in the Registration
Statement, the Debt Securities will constitute valid and legally
binding obligations of the Company, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights and to
general equity principles.
(2) With respect to the Debt Warrants, when the Registration
Statement has become effective under the
<PAGE> 3
Pharmacia & Upjohn, Inc. -3-
Act, the Debt Warrant Agreements relating to the Debt Warrants have
been duly authorized, executed and delivered, the terms of the Debt
Warrants and of their issuance and sale have been duly established in
conformity with the applicable Debt Warrant Agreements so as not to
violate any applicable law or result in a default under or breach of
any agreement or instrument binding upon the Company and so as to
comply with any requirement or restriction imposed by any court or
governmental body having jurisdiction over the Company, and the Debt
Warrants have been duly executed and authenticated in accordance with
the applicable Debt Warrant Agreements and issued and sold as
contemplated in the Registration Statement, the Debt Warrants will
constitute valid and legally binding obligations of the Company,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or
affecting creditors' rights and to general equity principles.
(3) With respect to the Preferred Stock, when the Registration
Statement has become effective under the Act, a certificate of
designations with respect to the
<PAGE> 4
Pharmacia & Upjohn, Inc. -4-
Preferred Stock has been duly filed with the Secretary of State of the
State of Delaware, the terms of the Preferred Stock and of their issue
and sale have been duly established in conformity with the Company's
restated certificate of incorporation so as not to violate any
applicable law or result in a default under or breach of any agreement
or instrument binding upon the Company and so as to comply with any
requirement or restriction imposed by any court or governmental body
having jurisdiction over the Company, and the Preferred Stock has been
duly issued and sold as contemplated by the Registration Statement, the
Preferred Stock will be validly issued, fully paid and nonassessable.
(4) With respect to the Common Stock, when the Registration
Statement has become effective under the Act, the terms of the sale of
the Common Stock have been duly established in conformity with the
Company's restated certificate of incorporation so as not to violate
any applicable law or result in a default under or breach of any
agreement or instrument binding upon the Company and so as to comply
with any requirement or restriction imposed by any court or
governmental body
<PAGE> 5
Pharmacia & Upjohn, Inc. -5-
having jurisdiction over the Company, and the Common Stock has been
duly issued and sold as contemplated by the Registration Statement, the
Common Stock will be validly issued, fully paid and nonassessable.
We note that, as of the date of this opinion, a judgment for
money in an action based on a Security denominated in a foreign currency or
currency unit in a Federal or state court in the United States ordinarily would
be enforced in the United States only in United States dollars. The date used to
determine the rate of conversion of the foreign currency or currency unit in
which a particular Security is denominated into United States dollars will
depend upon various factors, including which court renders the judgment. In the
case of a Security denominated in a foreign currency, a state court in the State
of New York rendering a judgment on such Security would be required under
Section 27 of the New York Judiciary Law to render such judgment in the foreign
currency in which the Security is denominated, and such judgment would be
converted into United States dollars at the exchange rate prevailing on the date
of entry of the judgment.
<PAGE> 6
Pharmacia & Upjohn, Inc. -6-
The foregoing opinion is limited to the Federal laws of the
United States, the laws of the State of New York and the General Corporation Law
of the State of Delaware, and we are expressing no opinion as to the effect of
the laws of any other jurisdiction.
Also, we have relied as to certain matters on information
obtained from public officials, officers of the Company and other sources
believed by us to be responsible.
We hereby consent to the filing of this opinion as an exhibit
to the Registration Statement and to the reference to us under the heading
"Validity" in the Prospectus. In giving such consent, we do not thereby admit
that we are in the category of persons whose consent is required under Section 7
of the Act.
Very truly yours,
/s/ SULLIVAN & CROMWELL
<PAGE> 1
EXHIBIT 12.1
PHARMACIA & UPJOHN, INC. AND SUBSIDIARIES
COMPUTATION OF RATIOS
(Dollar amounts in millions)
<TABLE>
<CAPTION>
For three
months ended
March 31 Year Ended December 31,
-----------------------------------------------------
1999 1998 1997 1996 1995 1994
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Earnings from continuing operations before income taxes $316 $1,016 $468 $838 $1,136 $1,271
Less: Equity in undistributed net income (loss) of companies
owned less than 50% 5 58 (32) 5 7 8
-----------------------------------------------------
$311 $ 958 $500 $833 $1,129 $1,263
Add: Amortization of previously capitalized interest 3 12 12 11 10 8
Fixed charges included in the above:
Interest and amortization of debt expense 14 49 58 82 121 139
Rental expense representative of an interest factor 8 28 38 37 35 35
-----------------------------------------------------
Earnings from continuing operations before income taxes
and fixed charges $336 $1,047 $608 $963 $1,295 $1,445
=====================================================
Interest incurred and amortization of debt expense $ 18 $ 84 $ 90 $115 $ 149 $ 164
Rental expense representative of an interest factor 8 28 38 37 35 35
-----------------------------------------------------
Total fixed charges $ 26 $ 112 $128 $152 $ 184 $ 199
=====================================================
Preferred stock dividends 4 17 18 18 18 18
-----------------------------------------------------
Total fixed charges and preferred stock dividends $ 30 $ 129 $146 $170 $ 202 $ 217
=====================================================
Ratio of earnings to fixed charges 12.9 9.3 4.8 6.3 7.0 7.2
=====================================================
Ratio of earnings to combined fixed charges
and preferred stock dividends 11.2 8.1 4.2 5.7 6.4 6.7
=====================================================
</TABLE>
<PAGE> 1
EXHIBIT 15
July 13, 1999
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
RE: Pharmacia & Upjohn, Inc. and Subsidiaries
Registration on Form S-3
We are aware that our report dated April 27, 1999 on our review of
interim financial information of Pharmacia & Upjohn, Inc. (the "Company") as of
and for the period ended March 31, 1999 and included in the Company's quarterly
report on Form 10-Q for the quarter then ended is incorporated by reference in
its Registration Statement on Form S-3 dated July 13, 1999.
Very truly yours,
PricewaterhouseCoopers LLP
<PAGE> 1
EXHIBIT 23(A)
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this
Registration Statement on Form S-3 of our report dated February 10, 1999
relating to the financial statements, which appears in the 1998 Annual Report to
Shareholders, which is incorporated by reference in Pharmacia & Upjohn Inc.'s
Annual Report on Form 10-K for the year ended December 31, 1998. We also consent
to the reference to us under the headings "Independent Accountants" and "Summary
Consolidated Financial Data" in such Registration Statement.
PricewaterhouseCoopers LLP
Chicago, Illinois
July 13, 1999
<PAGE> 1
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 (I.R.S. employer
if not a U.S. national bank) identification no.)
One Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
_____________________
PHARMACIA & UPJOHN, INC.
(Exact name of obligor as specified in its charter)
Delaware 98-0155411
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
95 Corporate Drive
Bridgewater, New Jersey 08807
(Address of principal executive offices) (Zip code)
_____________________
Debt Securities
(Title of the indenture securities)
================================================================================
<PAGE> 2
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.
---------------------------------------------------------------------------
Name Address
---------------------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York, N.Y.
New York 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York, N.Y.
10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(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.
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 17 C.F.R.
229.10(d).
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.
-2-
<PAGE> 3
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 8th day of July, 1999.
THE BANK OF NEW YORK
By: /s/ REMO J. REALE
----------------------------
Name: REMO J. REALE
Title: ASSISTANT VICE PRESIDENT
-3-
<PAGE> 4
EXHIBIT 7
Consolidated Report of Condition of
THE BANK OF NEW YORK
of One Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business March 31, 1999,
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..........$ 4,508,742
Interest-bearing balances................................... 4,425,071
Securities:
Held-to-maturity securities................................. 836,304
Available-for-sale securities............................... 4,047,851
Federal funds sold and Securities purchased under agreements
to resell................................................... 1,743,269
Loans and lease financing receivables:
Loans and leases, net of
unearned income.................... 39,349,679
LESS: Allowance for loan
and lease losses................... 603,025
LESS: Allocated transfer
risk reserve....................... 15,906
Loans and leases, net of unearned income, allowance, and
reserve................................................... 38,730,748
Trading Assets................................................ 1,571,372
Premises and fixed assets (including capitalized leases)...... 685,674
Other real estate owned....................................... 10,331
Investments in unconsolidated subsidiaries and
associated companies........................................ 182,449
Customers' liability to this bank on acceptances outstanding.. 1,184,822
Intangible assets............................................. 1,129,636
Other assets.................................................. 2,632,309
-----------
Total assets..................................................$61,688,578
===========
LIABILITIES
Deposits:
In domestic offices.........................................$25,731,036
Noninterest-bearing.......... 10,252,589
Interest-bearing............. 15,478,447
In foreign offices, Edge and Agreement subsidiaries,
and IBFs.................................................. 18,756,302
Noninterest-bearing.......... 111,386
Interest-bearing............. 18,644,916
Federal funds purchased and Securities sold under
agreements to repurchase.................................... 3,276,362
Demand notes issued to the U.S. Treasury...................... 230,671
Trading liabilities........................................... 1,554,493
Other borrowed money:
With remaining maturity of one year or less................. 1,154,502
With remaining maturity of more than one year through three
years..................................................... 465
With remaining maturity of more than three years............ 31,080
Bank's liability on acceptances executed and outstanding...... 1,185,364
Subordinated notes and debentures............................. 1,308,000
Other liabilities............................................. 2,743,590
Total liabilities............................................. 55,971,865
EQUITY CAPITAL
Common stock.................................................. 1,135,284
Surplus....................................................... 764,443
Undivided profits and capital reserves........................ 3,807,697
Net unrealized holding gains (losses)
on available-for-sale securities............................ 44,106
Cumulative foreign currency translation adjustments........... (34,817)
-----------
Total equity capital.......................................... 5,716,713
-----------
Total liabilities and equity capital..........................$61,688,578
===========
</TABLE>
I. Thomas J. Mastro, 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.
Thomas J. Mastro
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.
Thomas A. Reyni }
Alan R. Griffith } Directors
Gerald L. Hassell }
