<PAGE>
As filed with the Securities and Exchange Commission on May 24, 1995
Registration No. 33-59463
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------
Amendment No. 1
to
FORM S-3
REGISTRATION STATEMENT
UNDER THE
SECURITIES ACT OF 1933
-------------
Leucadia National Corporation
(Exact Name of Registrant as Specified in its Charter)
New York 13-2615557
(State or Other Jurisdiction (I.R.S. Employer Identification
of Incorporation or No.)
Organization)
315 Park Avenue South
New York, N.Y. 10010-3607
(212) 460-1900
(Address, Including Zip Code, and Telephone Number,
including Area Code, of Registrant's Principal Executive Offices)
JOSEPH A. ORLANDO
Vice President and Comptroller
Leucadia National Corporation
315 Park Avenue South
New York, N.Y. 10010-3607
(212) 460-1900
(Name and Address, Including Zip Code,
and Telephone Number, Including Area Code, of Agent For Service)
Copies to:
STEPHEN E. JACOBS, ESQ. GERALD S. TANENBAUM, ESQ.
Weil, Gotshal & Manges MICHAEL A. BECKER, ESQ.
767 Fifth Avenue Cahill Gordon & Reindel
New York, New York 10153 80 Pine Street
(212) 310-8000 New York, New York 10005
(212) 701-3000
Approximate date of commencement of proposed sale of the securities to the
public: As soon as practicable 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. [_]
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 Securities and
Exchange Commission, acting pursuant to said Section 8(a), may determine.
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<PAGE>
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED
WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT
BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE
REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT
CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR
SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH
OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR
QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
<PAGE>
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The estimated expenses payable by the Registrant in connection
with the securities being registered are as follows:
<TABLE>
<S> <C>
SEC Registration Fee . . . . . . . . . . . $ 34,483
Rating Agency Fee . . . . . . . . . . . .
Accounting Fees and Expenses . . . . . . .
Printing and Photocopying . . . . . . . .
Legal Fees and Expenses . . . . . . . . .
Blue Sky Fees and Expenses . . . . . . . .
Fees of Trustees . . . . . . . . . . . . .
Miscellaneous Expenses . . . . . . . . . .
----------
Total Expenses . . . . . . . . . . $
==========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Sections 722 through 725 of the New York Business Corporation
Law (the "Business Corporation Law") provide that a corporation may
indemnify, with certain limitations and exceptions, a director or
officer as follows: (1) in a derivative action, against his
reasonable expenses, including attorneys' fees but excluding certain
settlement costs, actually and necessarily incurred by him in
connection with the defense thereof, or an appeal therein, if such
director or officer acted, in good faith, for a purpose which he
reasonably believed to be in (or in the case of service for another
corporation, not opposed to) the best interests of the corporation;
and (2) in a civil or criminal non-derivative action or proceeding
including a derivative action by another corporation, partnership or
other enterprise in which any director or officer of the indemnifying
corporation served in any capacity at the indemnifying corporation's
request, against judgments, fines, settlement payments and reasonable
expenses, including attorneys' fees, incurred as a result thereof, or
any appeal therein, if such director or officer acted in good faith,
for a purpose which he reasonably believed to be in (or, in the case
of service for any other corporation, not opposed to) the best
interests of the corporation and, in criminal actions and proceedings,
in addition, had no reasonable cause to believe that his conduct was
unlawful. Such indemnification is a matter of right where the
director or officer has been successful on the merits or otherwise,
and otherwise may be granted upon corporate authorization or court
award as provided in the statute.
Section 721 of the Business Corporation Law provides that
indemnification arrangements can be established for directors and
officers, by contract, by-law, charter provision, action of
shareholders or board of directors, on terms other than those
specifically provided by Article 7 of the Business Corporation Law,
provided that no indemnification may be made to or on behalf of any
director or officer if a judgment or other final adjudication adverse
to the director or officer establishes that his acts were committed in
bad faith or were the result of active and deliberate dishonesty and
were material to the cause of action so adjudicated, or that he
personally gained in fact a financial profit or other advantage to
which he was not legally entitled. Article V of the Company's By-Laws
provides for the indemnification, to the full extent authorized by
law, of any person made or threatened to be made a party in any civil
or criminal action or proceeding by reason of the fact that he, his
testator or intestate is or was a director or officer of the Company.
II-1<PAGE>
<PAGE>
Section 726 of the Business Corporation Law provides that a
corporation may obtain insurance to indemnify itself and its directors
and officers. The Company maintains an insurance policy providing
both directors and officers liability coverage and corporate
reimbursement coverage.
Article Sixth of the Company's Certificate of Incorporation
contains a charter provision eliminating or limiting director
liability for monetary damages arising from breaches of fiduciary
duty, subject only to certain limitations imposed by statute.
ITEM 16. EXHIBITS.
Exhibit
Number Description
------- -----------
1 -Form of Underwriting Agreement.
2.1 -Stock Purchase Agreement, as amended, dated as of May
12, 1995, by and among the Company and Morrison Knudsen
Corporation (filed as Exhibit 1 to the Schedule 13D
relating to MK Gold Company filed by the Company on
May 23, 1995).*
4.1 -Form of Indenture, dated as of ________, 1995, between
the Company and The First National Bank of Boston, as
Trustee, in respect of the Company's % Senior
Subordinated Notes due 2005.
4.2 -Form of Senior Subordinated Note (included in the form
of Indenture to be filed as Exhibit 4.1 to this
Registration Statement).
5 -Opinion of Weil, Gotshal & Manges.**
12 -Statement of Computation of Ratio of Earnings to Fixed
Charges.
23.1 -Consent of Coopers & Lybrand L.L.P.***
23.2 -Consent of Weil, Gotshal & Manges (included in the
opinion to be filed as Exhibit 5 to this Registration
Statement).**
24 -Power of Attorney.***
25 -Statement of Eligibility and Qualification of The
First National Bank of Boston, as Trustee on Form
T-1 with respect to the % Senior Subordinated
Notes due 2005.
28 -Schedule P of the 1994 Annual Statement to Insurance
Departments of the Colonial Penn Insurance Company
and Affiliated Property/Casualty Insurers and the
Empire Insurance Company, Principal Insurer (filed
as Exhibit 28 to the Company's Annual Report on
Form 10-K for the fiscal year ended December 31, 1994).*
------------
* Incorporated by reference.
** To be filed by amendment.
*** Previously filed.
II-2
NYFS04...:\30\76830\0001\1980\SCH5125Y.20B
<PAGE>
<PAGE>
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of
1933, each filing of the registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934
(and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Securities Exchange Act
of 1934) that is incorporated by reference in the registration
statement shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of such securities
at the time shall be deemed to be the initial bona fide offering
thereof.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the provisions in
Item 15 above, or otherwise, the Company 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 of 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.
The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under
the Securities Act of 1933, the information omitted from the
form of prospectus filed as part of this registration statement
in reliance upon Rule 430A and contained in a form of prospectus
filed by the registrant pursuant to Rule 424(b)(1) or (4),
or 497(h) under the Securities Act shall be deemed to be part
of this registration statement as of the time it was declared
effective.
(2) For the purpose of determining any liability under
the Securities Act of 1933, each post-effective amendment that
contains a form of prospectus shall be deemed to be a new
registration statement relating to the securities offered
therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
The undersigned registrant hereby undertakes to file an
application for the purpose of determining the eligibility of the
trustee to act under subsection (a) of Section 310 of the Trust
Indenture Act (the "Act") in accordance with the rules and regulations
prescribed by the Commission under Section 305(b)(2) of the Act.
II-3<PAGE>
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the registrant certifies that it has reasonable grounds to believe
that it meets all the requirements for filing on Form S-3 and has duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City and State of New
York, on this 24th day of May, 1995.
LEUCADIA NATIONAL CORPORATION
By: /s/ Joseph A. Orlando
-------------------------------
Joseph A. Orlando
Vice President and
Comptroller
Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed below by the following
persons on behalf of the registrant and in the capacities indicated,
on the date set forth above.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <S> <C>
* Chairman of the Board May 24, 1995
--------------------------- (Principal Executive Officer)
(Ian M. Cumming)
* President and Director May 24, 1995
---------------------------- (Principal Executive Officer)
(Joseph S. Steinberg)
/s/ Joseph A. Orlando Vice President and Comptroller May 24, 1995
---------------------------- (Principal Financial and
(Joseph A. Orlando) Accounting Officer)
* Director May 24, 1995
----------------------------
(Paul M. Dougan)
* Director May 24, 1995
----------------------------
(Lawrence D. Glaubinger)
* Director May 24, 1995
----------------------------
(James E. Jordan)
* Director May 24, 1995
----------------------------
(John W. Jordan II)
* Director May 24, 1995
----------------------------
(Jesse Clyde Nichols, III)
</TABLE>
*By: /s/ Joseph A Orlando
-------------------------------
Joseph A. Orlando
(Attorney-in-Fact)
II-4<PAGE>
<PAGE>
EXHIBIT INDEX
Exemption
Exhibits Indication
-------- ----------
1 -Form of Underwriting Agreement.
2.1 -Stock Purchase Agreement, dated as of
May 12, 1995, by and among the Company and
Morrison Knudsen Corporation (filed as
Exhibit 1 to the Schedule 13D relating to MK
Gold Company filed by the Company on
May 23, 1995).*
4.1 -Form of Indenture, dated as of
___________, 1995, between the Company and
The First Bank of Boston, as Trustee, in
respect of the Company's % Senior
Subordinated Notes due 2005.
4.2 -Form of Senior Subordinated Notes
(included in the form of Indenture to be filed
as Exhibit 4.1 to this Registration Statement).
5 -Opinion of Weil, Gotshal & Manges.**
12 -Statement of Computation of Ratio of
Earnings to Fixed Charges.
23.1 -Consent of Coopers & Lybrand L.L.P.***
23.2 -Consent of Weil, Gotshal & Manges
(included in the opinion to be filed as
Exhibit 5 to this Registration Statement).**
24 -Power of Attorney.***
25 -Statement of Eligibility and Qualification
of The First Bank of Boston, as Trustee
on Form T-1 with respect to the % Senior
Subordinated Notes due 2005.
28 -Schedule P of the 1994 Annual
Statement to Insurance Departments of
the Colonial Penn Insurance Company
and Affiliated Property/Casualty Insurers
and the Empire Insurance Company, Principal
Insurer (filed as Exhibit 28 to the
Company's Annual Report on Form 10-K
for the fiscal year ended December 31, 1994).*
----------
* Incorporated by reference.
** To be filed by amendment.
*** Previously filed.
<PAGE>
EXHIBIT 1
[Proof of May 24, 1995]
Leucadia National Corporation
(a New York corporation)
$100,000,000
% Senior Subordinated Notes due 2005
UNDERWRITING AGREEMENT
, 1995
Jefferies & Company, Inc.
11100 Santa Monica Boulevard
Los Angeles, California 90025
CS First Boston Corporation
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
PaineWebber Incorporated
1285 Avenue of the Americas
New York, New York 10019
Dear Sirs:
Leucadia National Corporation, a New York corporation
(the "Company"), hereby confirms its agreement with each of you
(the "Underwriters") with respect to the sale by the Company
and the purchase by the Underwriters, acting severally and not
jointly, of $100,000,000 aggregate principal amount of the Com-
pany's % Senior Subordinated Notes due 2005 (the "Securi-
ties") as set forth in Schedule A hereto.
The Securities are to be issued pursuant to an inden-
ture (the "Indenture") between the Company and The First
National Bank of Boston, as Trustee (the "Trustee").
You have advised us that you desire to purchase the
Securities and that you propose to make a public offering of
the Securities as soon as you deem advisable after the Regis-
tration Statement referred to below becomes effective, the
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Pricing Agreement (as defined below) has been executed and
delivered and the Indenture has been qualified under the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act").
Prior to the purchase and public offering of the
Securities by the Underwriters, the Company and the Underwrit-
ers shall enter into an agreement substantially in the form of
Exhibit A hereto (the "Pricing Agreement"). The Pricing Agree-
ment may take the form of an exchange of any standard form of
written telecommunication between the Company and the Under-
writers and shall specify such applicable information as is
indicated in Exhibit A hereto. The offering of the Securities
will be governed by this Agreement, as supplemented by the
Pricing Agreement. From and after the date of execution and
delivery of the Pricing Agreement, this Agreement shall be
deemed to incorporate the Pricing Agreement.
The terms which follow, when used in this Agreement,
shall have the meanings indicated. "Preliminary Prospectus"
shall mean any preliminary prospectus referred to in
Section 1(a)(i) below and any preliminary prospectus included
in the Registration Statement on the date that the Registration
Statement becomes effective (the "Effective Date") that omits
Rule 430A Information (as defined below). "Registration State-
ment" shall mean the registration statement referred to in
Section 1(a)(i) below, including exhibits, as amended at the
Representation Date (as defined below) (or, if not effective at
the Representation Date, in the form in which it shall become
effective) and, in the event any post-effective amendment
thereto becomes effective prior to the Closing Date (as defined
in Section 2 hereof), shall also mean such registration state-
ment as so amended. Such term shall include Rule 430A Informa-
tion deemed to be included therein at the Effective Date as
provided by Rule 430A (as defined below). The prospectus con-
stituting a part of the Registration Statement (including the
Rule 430A Information) as from time to time amended or supple-
mented, is hereinafter referred to as the "Prospectus", except
that if any revised prospectus shall be provided to the Under-
writers by the Company which differs from the prospectus on
file at the Securities and Exchange Commission (the "Commis-
sion") at the Effective Date (whether or not such revised pro-
spectus is required to be filed by the Company pursuant to
Rule 424 of the Act Regulations), the term "Prospectus" shall
refer to each such revised prospectus from and after the time
it is first provided to the Underwriters for such use. "Rule
158," "Rule 424" and "Rule 430A" refer to such rules under the
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Securities Act of 1933, as amended (the "Act"; the rules and
regulations under the Act, the "Act Regulations"). "Rule 430A
Information" means information with respect to the Securities
and the offering thereof permitted to be omitted from the Reg-
istration Statement when it becomes effective pursuant to Rule
430A. Any reference herein to the Registration Statement, a
Preliminary Prospectus or the Prospectus shall be deemed to
refer to and include the documents incorporated by reference
therein pursuant to Item 12 of Form S-3, which have been filed
under the Securities Exchange Act of 1934, as amended, and the
rules and regulations of the Commission promulgated thereunder
(collectively, the "Exchange Act") as of the Effective Date,
and any reference herein to the terms "amend," "amendment" or
"supplement" with respect to the Registration Statement, a Pre-
liminary Prospectus or Prospectus shall be deemed to refer to
and include the filing after the execution hereof of any docu-
ment with the Commission deemed to be incorporated by reference
therein (all such incorporated documents being herein called
the "Incorporated Documents").
SECTION 1. Representations and Warranties. (a) The
Company represents and warrants to the Underwriters as of the
date hereof and as of the date of execution of the Pricing
Agreement (such date being referred to as the "Representation
Date") and as of the Closing Date (as defined in Section 2
below), as follows:
(i) The Company meets the requirements for use of
Form S-3 under the Act and has filed with the Commission a
registration statement (Registration No. 33-59463) on such
Form, including a related preliminary prospectus, for the
registration under the Act of the offering and sale of the
Securities. The Company may have filed one or more amend-
ments thereto, including the related preliminary prospec-
tus, each of which has previously been furnished to the
Underwriters. The Company will file with the Commission
either (A) prior to effectiveness of such registration
statement, a further amendment to such registration state-
ment (including the form of final prospectus) or (B) after
effectiveness of such registration statement, a final pro-
spectus in accordance with Rules 430A and 424(b) of the
Act Regulations. The Company has included in such regis-
tration statement, as amended at the Effective Date, all
information (other than Rule 430A Information in the case
of clause (B)) required by the Act and the Act Regulations
to be included in the Prospectus with respect to the
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Securities and the offering thereof. As filed, such
amendment and form of final prospectus, or such final pro-
spectus, shall contain all Rule 430A Information, together
with all other such required information, with respect to
the Securities and the offering thereof and, except to the
extent the Underwriters shall agree in writing to a modi-
fication, shall be in all substantive respects in the form
furnished to the Underwriters prior to the date hereof.
(ii) On the Effective Date and on the Representation
Date and the Closing Date, the Registration Statement did
and will, and when the Prospectus is first filed (if
required) in accordance with Rule 424(b) and on the Repre-
sentation Date and the Closing Date, the Prospectus
(together with any supplements thereto) will comply in all
material respects with the applicable requirements of the
Act and the Act Regulations; on the Effective Date and the
Closing Date, the Registration Statement did not and will
not contain any untrue statement of a material fact or
omit to state any material fact required to be stated
therein or necessary in order to make the statements
therein not misleading; and, on the Effective Date, the
Representation Date and the Closing Date, and on the date
of any filing pursuant to Rule 424(b), the Prospectus
(together with any supplements thereto) did not and will
not include any untrue statement of a material fact or
omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances
under which they were made, not misleading; provided, that
the Company makes no representations or warranties to an
Underwriter as to the information contained in or omitted
from the Registration Statement or the Prospectus (or any
supplement thereto) in reliance upon and in conformity
with information furnished in writing to the Company by or
on behalf of such Underwriter with respect to such Under-
writer for use in connection with the preparation of the
Registration Statement or the Prospectus (or any supple-
ment thereto).
(iii) In reliance in part upon representations of Coo-
pers & Lybrand L.L.P., the accountants who have certified
or shall certify the financial statements filed or to be
filed with the Commission as part of the Registration
Statement and the Prospectus (including the Incorporated
Documents) are independent accountants as required by the
Act.
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(iv) The Company has been duly incorporated and is
validly existing as a corporation in good standing under
the laws of the State of New York, with all requisite cor-
porate power and authority to own its properties and con-
duct its business as described in the Prospectus, and is
duly qualified to transact business and is in good stand-
ing as a foreign corporation in each jurisdiction where
the nature of its activities requires such qualification
except where the failure of the Company to be so qualified
would not, singly or in the aggregate, have a Material
Adverse Effect (as defined below).
(v) Each of the Company's subsidiaries listed in
Exhibit 21 to the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1994 and such other
subsidiaries created after such date that would be
required to be so listed if in existence at such date
(collectively, the "Subsidiaries") has been duly incorpo-
rated and is validly existing as a corporation in good
standing under the laws of the jurisdiction in which it is
chartered or organized, with all requisite corporate power
and authority to own its properties and conduct its busi-
ness as described in the Prospectus, and is duly qualified
to transact business and is in good standing as a foreign
corporation in each jurisdiction where the nature of its
activities requires such qualification except where the
failure of such Subsidiary to be so qualified would not,
singly or in the aggregate, have a Material Adverse
Effect.
(vi) All the outstanding shares of capital stock of
each Subsidiary have been duly authorized and validly
issued and are fully paid and non-assessable, and, except
as otherwise set forth in the Registration Statement and
the Prospectus, all outstanding shares of capital stock of
such Subsidiaries are owned by the Company, either
directly or through wholly-owned Subsidiaries, free and
clear of any security interests, claims, liens or
encumbrances.
(vii) The Company and each of its Subsidiaries have
all requisite power and authority, and all necessary mate-
rial authorizations, approvals, orders, licenses, certifi-
cates and permits of and from regulatory or governmental
officials, bodies and tribunals, to own or lease their
respective properties and to conduct their respective
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businesses as now being conducted and as described in the
Prospectus, and neither the Company nor any of its Subsid-
iaries has received any notice of proceedings relating to
the revocation or modification of any such authorizations,
approvals, orders, licenses, certificates or permits
which, singly or in the aggregate, if the failure to be so
licensed or approved or if the subject of an unfavorable
decision, ruling or finding, would have a materially
adverse effect on the condition (financial or otherwise),
earnings or business of the Company and its Subsidiaries,
considered as one enterprise, whether or not occurring in
the ordinary course of business (a "Material Adverse
Effect"); and the Company and its subsidiaries are in com-
pliance with all applicable laws, rules, regulations and
orders and consents, the violation of which would have a
Material Adverse Effect.
(viii) The Incorporated Documents, when they became
effective or were or are filed with the Commission, as the
case may be, complied or will comply, as the case may be,
in all material respects with the applicable requirements
of the Act, the Act Regulations and the Exchange Act, as
applicable.
(ix) Since the respective dates as of which informa-
tion is provided in the Prospectus, except as otherwise
specifically stated therein, there has been no material
adverse change or development with respect to the condi-
tion (financial or otherwise), earnings or business of the
Company and its Subsidiaries, considered as one enter-
prise, whether or not arising in the ordinary course of
business (a "Material Adverse Change").
(x) The authorized, issued and outstanding capital
stock of the Company is as set forth in the Prospectus or
the Incorporated Documents, without giving effect to any
exercise of outstanding options subsequent to the date of
the Prospectus and prior to the filing of any subsequent
Incorporated Document; all of the Company's issued and
outstanding common shares, $1.00 par value per share (the
"Common Shares"), have been duly authorized and validly
issued and are fully paid and non-assessable.
(xi) Neither the Company nor any of its Subsidiaries
is in violation of its respective charter or by-laws or
similar organizational documents or in default in the
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performance or observance of any obligation, agreement,
covenant or condition contained in any contract, inden-
ture, mortgage, loan agreement, note, lease or other
agreement or instrument (including, without limitation,
any Senior Indebtedness of the Company (as defined in the
Indenture)) to which the Company or any of its Subsidiar-
ies is a party or by which it or any of them may be bound,
or to which any of the property or assets of the Company
or any of its Subsidiaries is subject, the effect of which
violation or default in performance or observance would be
a Material Adverse Effect.
(xii) The Indenture has been duly authorized by the
Company and, upon execution and delivery by the Company
(assuming the due authorization, execution and delivery by
the Trustee), will constitute a valid and binding agree-
ment of the Company, enforceable in accordance with its
terms, subject to applicable bankruptcy, insolvency, reor-
ganization, moratorium and similar laws affecting credi-
tors' rights and remedies generally and subject, as to
enforceability, to general principles of equity (regard-
less of whether enforcement is sought in a proceeding in
equity or at law), including principles of commercial rea-
sonableness, good faith and fair dealing.
(xiii) The Securities, when executed by the Company and
authenticated by the Trustee in accordance with the terms
of the Indenture (assuming the due authorization, execu-
tion and delivery of the Indenture by the Trustee), and
delivered to and paid for by you in accordance with the
terms of this Agreement and the Pricing Agreement, will
constitute valid and binding obligations of the Company
entitled to the benefits of the Indenture.
(xiv) The Securities and the Indenture conform to the
respective descriptions thereof in the Registration State-
ment and Prospectus.
(xv) The Company is not (a) an "investment company"
within the meaning of the Investment Company Act of 1940,
as amended, or (b) a bank holding company under the Bank
Holding Company Act.
(xvi) There are no contracts or documents binding upon
or affecting the Company or any of its Subsidiaries that
are required to be filed as exhibits to the Registration
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-8-
Statement or to any of the documents incorporated by ref-
erence therein by the Act, the Act Regulations or the
Exchange Act that have not been so filed.
(xvii) No consent, approval, authorization or order of
any court or governmental agency or body is required for
the consummation of the transactions contemplated hereby,
except such as have been obtained under the Act and the
Trust Indenture Act and such as may be required under the
blue sky or insurance laws of any jurisdiction in connec-
tion with the purchase and distribution of the Securities
by the Underwriters and such other approvals as have been
obtained.
(xviii) Neither the issue and sale of the Securities,
nor the consummation of any other of the transactions
herein contemplated, nor the fulfillment of the terms
hereof, will conflict with, result in a breach of, or con-
stitute a default under the terms of any indenture or
other agreement or instrument to which the Company or any
of its Subsidiaries is a party or bound or any order, reg-
ulation, consent or memorandum of understanding applicable
to the Company or any of its Subsidiaries of any court,
regulatory body, administrative agency, governmental body
or arbitrator having jurisdiction over the Company or any
of its Subsidiaries (where such conflict, breach or
default would, singly or in the aggregate, have a Material
Adverse Effect) or the charter or by-laws of the Company.
(b) Any certificate signed by any officer of the
Company and delivered to the Underwriters or to counsel for the
Underwriters pursuant to the terms of this Agreement shall be
deemed a representation and warranty by the Company to each
Underwriter as to the matters covered thereby.
SECTION 2. Sale and Delivery to the Underwriters;
Closing. (a) The Company agrees to sell to each Underwriter,
severally and not jointly, and, on the basis of the representa-
tions and warranties herein contained and subject to the terms
and conditions herein set forth, each Underwriter agrees to
purchase from the Company, at the purchase price set forth in
the Pricing Agreement, the aggregate principal amount of Secu-
rities set forth in Schedule A hereto opposite the name of such
Underwriter. The Company will have no obligation to sell to
the Underwriters any of the Securities hereunder unless the
Underwriters purchase all of the Securities hereunder.
<PAGE>
<PAGE>
-9-
If the Company has elected not to rely upon Rule
430A, the initial public offering price of the Securities and
the purchase price of the Securities to be paid by the Under-
writers and certain other principal terms of the Securities
have each been determined and set forth in the Pricing Agree-
ment, dated the date hereof, and an amendment to the Registra-
tion Statement and the Prospectus containing such information
will be filed before the Registration Statement becomes
effective.
If the Company has elected to rely upon Rule 430A,
the initial public offering price of the Securities, the pur-
chase price for the Securities to be paid by the Underwriters
and certain other principal terms of the Securities shall be
agreed upon and set forth in the Pricing Agreement. In the
event that such price and terms have not been agreed upon and
the Pricing Agreement has not been executed and delivered by
all parties thereto by the close of business on the fourth
business day following the date of this Agreement, this Agree-
ment shall terminate forthwith, without liability of any party
to any other party, except as set forth in Section 4 hereof.
(b) Payment of the purchase price for, and delivery
of, the Securities to be purchased by the Underwriters shall be
made at the offices of Cahill Gordon & Reindel, 80 Pine Street,
New York, New York 10005, or at such other place as shall be
agreed upon by the Underwriters and the Company, at 10:00 A.M.
on the fifth business day following the date the Registration
Statement becomes effective (or, if the Company has elected to
rely upon Rule 430A, the fifth business day after the date of
execution of the Pricing Agreement), or such other time not
later than ten business days after such date as shall be agreed
upon by the Underwriters and the Company (such time and date of
payment and delivery being herein called "Closing Date").
Payment shall be made to the Company by certified or
official bank check or checks drawn in New York Clearing House
funds or similar next day funds payable to the order of the
Company against delivery to the Underwriters of the Securities
to be purchased by them. The Securities shall be in such
denominations and registered in such names as the Underwriters
may request in writing at least two business days before the
Closing Date. The Securities will be made available for exami-
nation and packaging by the Underwriters not later than
1:00 P.M. on the last business day prior to the Closing Date at
the offices of the Trustee in New York City.
<PAGE>
<PAGE>
-10-
SECTION 3. Covenants of the Company. The Company
covenants with each of the Underwriters as follows:
(a) The Company will use its best efforts to cause
the Registration Statement, if not effective at the date
of this Agreement, and any amendment thereof, to become
effective, as promptly as possible after the filing
thereof. The Company will not file any amendment to the
Registration Statement or amendment or supplement to the
Prospectus (including any document required to be filed
under the Exchange Act that upon filing is deemed to be
incorporated by reference therein) to which the Underwrit-
ers shall reasonably object in writing after a reasonable
opportunity to review such amendment or supplement. The
Company shall furnish to the Underwriters copies of any
document that upon filing is deemed to be incorporated by
reference in the Registration Statement or Prospectus.
Subject to the foregoing sentences in this clause (a), if
the Registration Statement has become or becomes effective
pursuant to Rule 430A, or filing of the Prospectus or sup-
plement to the Prospectus is otherwise required under
Rule 424(b), the Company will cause the Prospectus, prop-
erly completed, or such supplement thereto to be filed
with the Commission pursuant to the applicable paragraph
of Rule 424(b) within the time period prescribed and will
provide evidence satisfactory to the Underwriters of such
timely filing. The Company will promptly advise the
Underwriters (A) when the Registration Statement, if not
effective at the date of this Agreement, and any amendment
thereto, shall have become effective, (B) when the Pro-
spectus, and any supplement thereto, shall have been filed
(if required) with the Commission pursuant to Rule 424(b),
(C) when any amendment to the Registration Statement shall
have been filed or become effective, (D) of any request by
the Commission for any amendment of the Registration
Statement or supplement to the Prospectus or for any addi-
tional information, (E) of the receipt by the Company of
any notification of, or if the Company otherwise has
knowledge of, the issuance by the Commission of any stop
order suspending the effectiveness of the Registration
Statement or the institution or threatening of any pro-
ceeding for that purpose and (F) of the receipt by the
Company of any notification with respect to the suspension
of the qualification of the Securities for sale in any
jurisdiction or the initiation or threatening of any pro-
ceeding for such purpose. The Company will use its best
<PAGE>
<PAGE>
-11-
efforts to prevent the issuance of any such stop order
and, if issued, to obtain as soon as possible the with-
drawal thereof.
(b) If, at any time when a prospectus relating to
the Securities is required to be delivered under the Act,
any event occurs as a result of which the Prospectus as
then amended or supplemented would include any untrue
statement of a material fact or omit to state any material
fact necessary to make the statements therein in the light
of the circumstances under which they were made not mis-
leading, or if it shall be necessary to amend the Regis-
tration Statement or amend or supplement the Prospectus to
comply with the Act or the Act Regulations, the Company
promptly will prepare and file with the Commission, sub-
ject to the second sentence of Section 3(a), an amendment
or supplement which will correct such statement or omis-
sion or effect such compliance.
(c) As soon as practicable, the Company will make
generally available to its securityholders and to the
Underwriters an earning statement or statements of the
Company and its Subsidiaries covering the twelve-month
period ending [June 30], 1996 which will satisfy the pro-
visions of Section 11(a) of the Act and Rule 158.
(d) The Company will furnish to the Underwriters and
counsel for the Underwriters, without charge, four signed
copies of the Registration Statement (including exhibits
thereto and all documents incorporated by reference
therein) and, so long as delivery of a prospectus by an
Underwriter or dealer may be required by the Act, as many
copies of each Preliminary Prospectus and the Prospectus
and all amendments and supplements thereto as the Under-
writers may reasonably request.
(e) The Company will cooperate with the Underwriters
and their counsel in connection with endeavoring to obtain
the qualification or registration, or exemption from
qualification, of the Securities for offer and sale under
the applicable securities and insurance laws of such
states and other jurisdictions of the United States as the
Underwriters may designate; provided, that in no event
shall the Company be obligated to qualify to do business
in any jurisdiction where it is not now so qualified or to
take any action which would subject it to taxation or
<PAGE>
<PAGE>
-12-
general service of process in any jurisdiction where it is
not now so subject; and will maintain such qualifications
in effect for a period of not less than one year from the
Effective Date.
SECTION 4. Payment of Expenses. The Company will
pay all expenses incident to the performance of its obligations
under this Agreement, including (i) the printing and filing of
the Registration Statement and the Form T-1 as originally filed
and of each amendment thereto, (ii) the printing and/or copying
of this Agreement, the Pricing Agreement and the Indenture,
(iii) the preparation, issuance and delivery of the Securities
to the Underwriters, including capital duties, stamp duties and
transfer taxes, if any, payable upon issuance of any of the
Securities, the sale of the Securities to the Underwriters and
the fees and expenses of the Trustee, (iv) the fees and dis-
bursements of the Company's counsel and accountants, (v) the
qualification of the Securities under state securities and
insurance laws in accordance with the provisions of Section
3(e), including filing fees and the reasonable fees and dis-
bursements of counsel for the Underwriters in connection there-
with and in connection with the preparation of any Blue Sky
Survey, (vi) the printing and delivery to the Underwriters of
copies of the Registration Statement as originally filed and of
each amendment thereto, of the Preliminary Prospectus, and of
the Prospectus and any amendments or supplements thereto,
(vii) the printing and/or copying and delivery to the Under-
writers of copies of the Blue Sky Survey, (viii) the fee of any
filing for review of the offering with the National Association
of Securities Dealers, Inc., (ix) the fees and expenses
incurred in connection with the rating of the Securities by
rating agencies and (x) the fees and expenses incurred in con-
nection with the listing of the Securities on the New York
Stock Exchange.
If this Agreement is terminated pursuant to the third
paragraph of Section 2(a) or by the Underwriters in accordance
with the provisions of Section 5 or Sections 8(a)(i) or
8(a)(ii), the Company shall reimburse the Underwriters for all
of their reasonable out-of-pocket expenses, including the rea-
sonable fees and disbursements of counsel for the Underwriters.
SECTION 5. Conditions of the Underwriters' Obliga-
tions. The obligations of the Underwriters to purchase the
Securities hereunder are subject to the continued accuracy in
all material respects of the representations and warranties of
<PAGE>
<PAGE>
-13-
the Company herein contained, to the accuracy of the statements
of the Company made in any certificate pursuant to the provi-
sions hereof, to the performance by the Company of its obliga-
tions hereunder, and to the following further conditions:
(a) The Registration Statement shall have become
effective not later than 5:30 P.M. on the date hereof, or
at such later time and date as may be approved by the
Underwriters and by the Company and shall remain effective
at the Closing Date. No stop order suspending the effec-
tiveness of the Registration Statement shall have been
issued under the Act or proceedings therefor initiated or
threatened by the Commission. If the Company has elected
to rely upon Rule 430A, the price of the Securities and
any price-related information previously omitted from the
effective Registration Statement pursuant to Rule 430A
shall have been transmitted to the Commission for filing
pursuant to Rule 424(b) within the prescribed time period,
and prior to the Closing Date, the Company shall have pro-
vided evidence satisfactory to the Underwriters of such
timely filing, or a post-effective amendment providing
such information shall have been promptly filed and
declared effective in accordance with the requirement of
Rule 430A.
(b) The Company shall have furnished to the Under-
writers the opinion of Weil, Gotshal & Manges, counsel for
the Company, dated the Closing Date, to the effect that:
(i) The Company has been duly incorporated and
is validly existing as a corporation in good standing
under the laws of the State of New York, with all
requisite corporate power and authority to own its
properties and conduct its business as described in
the Prospectus, and, to the best knowledge of such
counsel, is duly qualified to transact business and
is in good standing as a foreign corporation in each
jurisdiction where the nature of its business
requires such qualification except where the failure
of the Company to be so qualified would not, singly
or in the aggregate, have a materially adverse effect
on the condition (financial or otherwise), earnings
or business of the Company and its Subsidiaries (as
defined below), considered as a whole (solely for
purposes of this Section 5(b), a "Material Adverse
Effect");
<PAGE>
<PAGE>
-14-
(ii) Each of Leucadia, Inc. and LNC Investments,
Inc. and any other corporations of which the Company
owns more than 50% of the outstanding capital stock,
directly or indirectly, and which contributed 10% or
more of the Company's consolidated revenues for the
year ended December 31, 1994 or which represented 10%
or more of the Company's consolidated total assets at
December 31, 1994, which information may be based
upon a certificate of an officer of the Company
(collectively, solely for purposes of this Section
5(b), the "Subsidiaries") (other than Charter
National Life Insurance Company ("Charter"), Empire
Insurance Company ("Empire") and Colonial Penn Group,
Inc. ("CPG") and its subsidiaries (collectively, the
"Insurance Subsidiaries") and other than Phlcorp,
Inc. ("Phlcorp")) has been duly incorporated and is
validly existing as a corporation in good standing
under the laws of the jurisdiction in which it is
organized, with all requisite corporate power and
authority to own its properties and conduct its busi-
ness as described in the Prospectus, and, to the best
knowledge of such counsel, is duly qualified to
transact business and is in good standing as a for-
eign corporation in each jurisdiction where the
nature of its activities requires such qualification,
except where the failure of such Subsidiary to be so
qualified would not, singly or in the aggregate, have
a Material Adverse Effect;
(iii) To the knowledge of such counsel, all the
outstanding shares of capital stock of each Subsid-
iary (other than the Insurance Subsidiaries and
Phlcorp) have been duly authorized and validly issued
and are fully paid and non-assessable, and, except as
otherwise set forth in the Registration Statement and
the Prospectus, to such counsel's knowledge, all out-
standing shares of capital stock of such Subsidiaries
(other than the Insurance Subsidiaries and Phlcorp)
are owned by the Company, either directly or through
wholly-owned Subsidiaries, free and clear of any
security interests, claims, liens or encumbrances;
(iv) Such counsel does not know of any pending
or threatened action, suit or proceeding before any
court or governmental agency, authority or body or
any arbitrator involving the Company or any of its
<PAGE>
<PAGE>
-15-
Subsidiaries required to be disclosed in the Prospec-
tus, which is not adequately disclosed in the Pro-
spectus, or any franchise, contract or other document
that is material to the Company and its Subsidiaries,
considered as a whole, and required to be described
in the Registration Statement or the Prospectus, or
to be filed as an exhibit, which is not described or
filed as required;
(v) (a) The Registration Statement has become
effective under the Act; (b) any required filing of
the Prospectus, and any supplements thereto, pursuant
to Rule 424(b) has been made in the manner and within
the time period required by Rule 424(b); and (c) to
the knowledge of such counsel, no stop order suspend-
ing the effectiveness of the Registration Statement
has been issued and no proceedings for that purpose
have been instituted or threatened;
(vi) The Company meets the requirements for the
use of Form S-3 under the Act;
(vii) (a) The Registration Statement and the Pro-
spectus (other than the financial statements (includ-
ing the notes thereto) and schedules and other finan-
cial and statistical data contained or incorporated
by reference therein as to which such counsel need
express no opinion) comply as to form in all material
respects with the applicable requirements of the Act
and the rules thereunder; and (b) the Incorporated
Documents (other than the financial statements
(including the notes thereto) and schedules and other
financial and statistical data contained or incorpo-
rated by reference therein as to which such counsel
need express no opinion), when filed, or as amended
or supplemented, complied as to form in all material
respects with the requirements of the Exchange Act;
(viii) Each of this Agreement and the Pricing
Agreement has been duly authorized, executed and
delivered by the Company;
(ix) No consent, approval, authorization or
order of any New York, Delaware corporate or Federal
governmental agency or body or, to our knowledge, any
court, is required for the consummation of the
<PAGE>
<PAGE>
-16-
transactions contemplated hereby, except such as have
been obtained under the Act and the Trust Indenture
Act and such as may be required under the blue sky or
insurance laws of any jurisdiction in connection with
the purchase and distribution of the Securities by
the Underwriters (as to which such counsel need
express no opinion);
(x) Neither the issue and sale of the Securi-
ties, nor the consummation of any other of the trans-
actions herein contemplated, nor the fulfillment of
the terms hereof, will conflict with, result in a
breach of, or constitute a default under the terms of
any indenture or other agreement or instrument known
to such counsel to which the Company or any of its
Subsidiaries is bound or any order, regulation, con-
sent or memorandum of understanding of any court,
regulatory body, administrative agency, governmental
body or arbitrator having jurisdiction over the Com-
pany or any of its Subsidiaries of which such counsel
is aware and known by such counsel to be applicable
to the Company or any of its Subsidiaries (where such
conflict, breach or default would, singly or in the
aggregate, have a Material Adverse Effect) or the
charter or by-laws of the Company;
(xi) The Securities have been duly authorized by
the Company for issuance; the Securities, when exe-
cuted by the Company and authenticated by the Trustee
in accordance with the Indenture (assuming the due
authorization, execution and delivery of the Inden-
ture by the Trustee) and delivered to and paid for by
the Underwriters in accordance with the terms of this
Agreement and the Pricing Agreement, will constitute
valid and legally binding obligations of the Company
entitled to the benefits of the Indenture, subject to
applicable bankruptcy, insolvency, fraudulent convey-
ance, reorganization, moratorium and similar laws
affecting creditors' rights and remedies generally
and subject, as to enforceability, to general princi-
ples of equity (regardless of whether enforcement is
sought in a proceeding in equity or at law);
(xii) The Company's outstanding Common Shares
have been duly authorized and validly issued and are
fully paid and non-assessable; and the shareholders
<PAGE>
<PAGE>
-17-
of the Company have no preemptive rights with respect
to the Common Shares;
(xiii) The Indenture has been duly and validly
authorized by the Company and has been duly qualified
under the Trust Indenture Act and, when duly executed
and delivered by the Company (assuming the due autho-
rization, execution and delivery by the Trustee),
will constitute a valid and legally binding obliga-
tion of the Company, enforceable against the Company
in accordance with its terms, subject to applicable
bankruptcy, insolvency, fraudulent conveyance, reor-
ganization, moratorium and similar laws affecting
creditors' rights and remedies generally and subject,
as to enforceability, to general principles of equity
(regardless of whether enforcement is sought in a
proceeding in equity or at law);
(xiv) The Securities, when issued, and the Inden-
ture conform in all material respects to the descrip-
tion thereof contained in the Prospectus;
(xv) The Company is not (a) an "investment com-
pany" within the meaning of the Investment Company
Act of 1940, as amended, or (b) a bank holding com-
pany under the Bank Holding Company Act.
In addition, such counsel shall also state that such
counsel have participated in conferences with representatives
of the Underwriters, officers and other representatives of the
Company and its subsidiaries and representatives of the inde-
pendent certified public accountants of the Company, at which
conferences the contents of the Registration Statement and the
Prospectus and related matters were discussed and, although
such counsel are not passing upon and do not assume any respon-
sibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement and the Pro-
spectus (except as set forth in clause (xiv) of this Section
5(b)), on the basis of the foregoing (relying as to materiality
to a large extent upon the opinions of officers and other rep-
resentatives of the Company), no facts have come to the atten-
tion of such counsel which lead such counsel to believe that
the Registration Statement at the time it became effective or
at the Representation Date 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
<PAGE>
<PAGE>
-18-
not misleading or that the Prospectus, at the Representation
Date (unless the term "Prospectus" refers to a prospectus which
has been provided to the Underwriters by the Company for use in
connection with the offering of the Securities which differs
from the Prospectus on file at the Commission at the Represen-
tation Date, in which case at the time it is first provided to
the Underwriters for such use) or at the Closing Date, included
or includes an untrue statement of a material fact or omitted
or omits to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under
which they were made, not misleading; provided, that such coun-
sel need not express any view with respect to (i) the Form T-1
and (ii) the financial statements (including the notes
thereto), supporting schedules or any other financial and sta-
tistical data set forth or referred to or incorporated by ref-
erence in the Registration Statement or the Prospectus.
In rendering such opinion, such counsel may rely (A)
as to matters involving the application of laws of any juris-
diction other than New York or the federal law of the United
States, to the extent they deem proper and specified in such
opinion, upon the opinions of other counsel and (B) as to mat-
ters of fact, to the extent they deem proper, on representa-
tions or certificates of responsible officers of the Company
and certificates of public officials. References to the Pro-
spectus in this Section 5(b) include any supplements thereto at
or prior to the Closing Date.
(c) The General Counsel or Compliance Officer, as
the case may be, of each of Charter, Empire and CPG and its
subsidiaries shall have furnished to the Underwriters their
opinions or certificates, as the case may be, dated the Closing
Date, to the effect that:
(i) The applicable Insurance Subsidiary has been
duly incorporated and is validly existing as a corporation
in good standing under the laws of the jurisdiction in
which it is chartered or organized, with all requisite
corporate power and authority to own its properties and
conduct its business as described in the Prospectus, and
is duly qualified to transact business and is in good
standing as a foreign corporation in each jurisdiction
where the nature of its activities requires such qualifi-
cation, except where the failure of such Insurance Subsid-
iary to be so qualified would not, singly or in the aggre-
gate, have a materially adverse effect on the condition
<PAGE>
<PAGE>
-19-
(financial or otherwise), earnings or business of such
Insurance Subsidiary (solely for purposes of this Section
5(c), a "Material Adverse Effect");
(ii) To the knowledge of such counsel or officer, as
the case may be, all the outstanding shares of capital
stock of such Insurance Subsidiary has been duly autho-
rized and validly issued and are fully paid and
non-assessable, and, except as otherwise set forth in the
Registration Statement and the Prospectus, all outstanding
shares of capital stock of such Insurance Subsidiary are
owned by the Company, either directly or through wholly
owned Subsidiaries, free and clear of any security inter-
ests, claims, liens or encumbrances;
(iii) To the knowledge of such counsel or officer, as
the case may be, each of the applicable Insurance Subsid-
iaries has all necessary federal, state or local govern-
mental licenses, authorizations, consents, approvals and
have made all necessary filings required under any fed-
eral, state or local law, regulation or rule in order to
conduct its respective business, except where the failure
to be so licensed, have such authorizations, consents or
approvals or to have made such filings would not, singly
or in the aggregate, have a Material Adverse Effect; and
to the knowledge of such counsel or officer, as the case
may be, such Insurance Subsidiary is not in violation of,
or in default under, any such license, authorization, con-
sent or approval or any federal, state or local law, regu-
lation or rule or any decree, order or judgment applicable
to such Insurance Subsidiary, except where such violation
or default would not, singly or in the aggregate, have a
Material Adverse Effect; and
(iv) Each applicable Insurance Subsidiary which is an
insurer or an insurance holding company is duly licensed
or admitted as an insurer or an insurance holding company
in each jurisdiction where it is required to be so
licensed to conduct its respective businesses as described
in the Prospectus, and each has all other necessary autho-
rizations, approvals, orders, certificates and permits of
and from all insurance authorities, commissions or other
insurance or other applicable regulatory authorities to
conduct their respective businesses as described in the
Prospectus, except where the failure to be so licensed or
admitted or to have such authorizations, approvals,
<PAGE>
<PAGE>
-20-
orders, certificates and permits would not, singly or in
the aggregate, have a Material Adverse Effect.
(d) The Company shall have furnished to the Under-
writers the opinion of Dilworth, Paxson, Kalish & Kauffman,
counsel for Phlcorp, dated the Closing Date, to the effect
that:
(i) Phlcorp has been duly incorporated and is val-
idly existing as a corporation in good standing under the
laws of the jurisdiction in which it is chartered or orga-
nized, with all requisite corporate power and authority to
own its properties and conduct its business as described
in the Prospectus, and is duly qualified to transact busi-
ness and is in good standing as a foreign corporation in
each jurisdiction where the nature of its activities
requires such qualification, except where the failure of
Phlcorp to be so qualified would not, singly or in the
aggregate, have a Material Adverse Effect; and
(ii) To the knowledge of such counsel, all the out-
standing shares of capital stock of Phlcorp have been duly
authorized and validly issued and are fully paid and
non-assessable, and, except as otherwise set forth in the
Registration Statement and the Prospectus, all outstanding
shares of capital stock of Phlcorp are owned by the Com-
pany, free and clear of any security interests, claims,
liens or encumbrances.
(e) The favorable opinion, dated as of the Closing
Date, of Cahill Gordon & Reindel, counsel for the Underwriters,
with respect to the matters set forth in clauses (v) (clauses
(a) and (c) only), (vii) (clause (a) only), (viii), (xi),
(xiii) and (xiv) of Section 5(b).
In addition, such counsel shall also state that such
counsel have participated in conferences with representatives
of the Underwriters, officers and other representatives of the
Company and its subsidiaries, counsel for the Company and rep-
resentatives of the independent public accountants for the Com-
pany, at which the contents of the Registration Statement and
the Prospectus and related matters were discussed and, although
such counsel are not passing upon and do not assume any respon-
sibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Pro-
spectus, on the basis of the foregoing (relying as to
<PAGE>
<PAGE>
-21-
materiality to a large extent upon the opinions of officers and
other representatives of the Company), no facts have come to
the attention of such counsel which lead such counsel to
believe that the Registration Statement, at the time it became
effective, contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading or
that the Prospectus (unless the term "Prospectus" refers to a
prospectus which has been provided to the Underwriters by the
Company for use in connection with the offering of the Securi-
ties which differs from the Prospectus on file at the Commis-
sion at the Representation Date, in which case at the time it
is first provided to the Underwriters for such use) at the Rep-
resentation Date, contained an untrue statement of a material
fact or omitted to state a material fact necessary in order to
make the statements therein, in light of the circumstances
under which they were made, not misleading; provided, that such
counsel need express no comment with respect to (i) the Form
T-1 and (ii) the financial statements (including the notes
thereto), supporting schedules or any financial or statistical
data set forth or referred to or incorporated by reference in
the Registration Statement or the Prospectus.
(f) The following conditions contained in clauses
(i), (ii) and (iii) of this Section 5(f) shall have been satis-
fied on and as of the Closing Date and the Company shall have
furnished to the Underwriters a certificate of the Company,
signed by the Chairman of the Board or the President and the
principal financial or accounting officer of the Company, dated
the Closing Date, to the effect that the signers of such cer-
tificate have carefully examined the Registration Statement,
the Prospectus, any supplement to the Prospectus, the Incorpo-
rated Documents and this Agreement and that, to the best of
their knowledge:
(i) the representations and warranties of the Com-
pany in this Agreement are true and correct in all mate-
rial respects on and as of the Closing Date with the same
effect as if made on the Closing Date and the Company has
complied with all the agreements and satisfied all the
conditions under this Agreement on its part to be per-
formed or satisfied at or prior to the Closing Date;
(ii) no stop order suspending the effectiveness of
the Registration Statement has been issued and no
<PAGE>
<PAGE>
-22-
proceedings for that purpose have been instituted or
threatened; and
(iii) since the date of the most recent financial
statements included in the Prospectus (exclusive of any
supplement thereto), there has been no Material Adverse
Change.
(g) At the time of execution of this Agreement and
at the Closing Date, Coopers & Lybrand shall have furnished to
the Underwriters a letter or letters, dated respectively as of
the Representation Date and as of the Closing Date, in form and
substance reasonably satisfactory to the Underwriters, contain-
ing statements and information of the type customarily included
in accountants' "comfort letters" to underwriters with respect
to the financial statements and certain financial and statisti-
cal information pertaining to the Company and its subsidiaries
contained in the Registration Statement, the Prospectus and the
Incorporated Documents and any document or instrument deemed to
be incorporated by reference in the Registration Statement and
Prospectus.
(h) At the Closing Date, counsel for the Underwrit-
ers shall have been furnished with such information, certifi-
cates and documents as they may reasonably require for the pur-
pose of enabling them to pass upon the issuance and sale of the
Securities as contemplated herein and related proceedings, or
in order to evidence the accuracy of any of the representations
or warranties, or the fulfillment of any of the conditions,
herein contained, or otherwise in connection with the offering
contemplated hereby; and all opinions and certificates men-
tioned above or elsewhere in this Agreement shall be reasonably
satisfactory in form and substance to the Underwriters and
counsel for the Underwriters.
If any condition specified in this Section 5 shall
not have been fulfilled in all material respects when and as
required to be fulfilled, this Agreement may be terminated by
the Underwriters by notice to the Company, and such termination
shall be without liability of any party to any other party
except as provided in Section 4.
SECTION 6. Indemnification and Contribution.
(a) The Company agrees to indemnify, defend and hold harmless
each Underwriter and its respective officers, employees and
directors and any person who controls any Underwriter within
<PAGE>
<PAGE>
-23-
the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, from and against any loss, expense, liability or
claim (including the reasonable cost of investigation) which,
jointly or severally, any such Underwriter or any such officer,
employee, director or controlling person may incur under the
Act, the Exchange Act or otherwise, as such expenses are
incurred, insofar as such loss, expense, liability or claim
arises out of or is based upon any untrue statement or alleged
untrue statement of a material fact contained in the Registra-
tion Statement (or in the Registration Statement as amended by
any post-effective amendment thereof) or in a Prospectus (the
term Prospectus for the purpose of this Section 6 being deemed
to include any Preliminary Prospectus, the Prospectus and the
Prospectus as amended or supplemented), or arises out of or is
based upon any omission or alleged omission to state a material
fact required to be stated in either such Registration State-
ment or the Prospectus or necessary to make the statements made
therein not misleading, except insofar as any such loss,
expense, liability or claim arises out of or is based upon any
untrue statement or alleged untrue statement of a material fact
made in conformity with information furnished in writing by
such Underwriter to the Company expressly for use with refer-
ence to such Underwriter in such Registration Statement or such
Prospectus or arises out of or is based upon any omission or
alleged omission to state a material fact in connection with
such information required to be stated in either such Registra-
tion Statement or Prospectus or necessary to make such informa-
tion not misleading; provided, that the indemnity agreement
contained in this Section 6(a) with respect to any untrue
statement or omission in any Preliminary Prospectus or amended
Preliminary Prospectus shall not inure to the benefit of any
Underwriter (or to the benefit of any person controlling such
Underwriter) from whom the person asserting any such loss,
expense, liability or claim purchased the Securities which is
the subject thereof, if the Prospectus corrected any such
alleged untrue statement or omission and if such Underwriter
failed to send or give a copy of the Prospectus, excluding any
documents incorporated by reference, to such person at or prior
to the written confirmation of the sale of Securities to such
person.
If any action is brought against an Underwriter or
its respective officers, employees, directors or person who
controls any Underwriter (as described above) in respect of
which indemnity may be sought against the Company pursuant to
the foregoing paragraph, such Underwriter shall promptly notify
the Company in writing of the institution of such action and
<PAGE>
<PAGE>
-24-
the Company shall assume the defense of such action, including
the employment of counsel and payment of reasonable expenses.
Such Underwriter or such officer, employee, director or person
who controls any Underwriter (as described above) shall have
the right to employ its or their own counsel in any such case,
but the fees and expenses of such counsel shall be at the
expense of such Underwriter or of such persons unless the
employment of such counsel shall have been authorized in writ-
ing by the Company in connection with the defense of such
action or the Company shall not have employed counsel to have
charge of the defense of such action or such indemnified party
or parties shall have reasonably concluded that there may be
defenses available to it or them which are different from or
additional to those available to the Company (in which case the
Company shall not have the right to direct the defense of such
action on behalf of the indemnified party or parties), in any
of which events such fees and expenses shall be borne by the
Company; provided, that the Company shall only be responsible
for the fees and expenses of one counsel for each Underwriter
hereunder. Anything in this paragraph to the contrary notwith-
standing, the Company shall not be liable for any settlement of
any such claim or action effected without its written consent,
which consent shall not be unreasonably withheld.
(b) Each Underwriter severally agrees to indemnify,
defend and hold harmless the Company, each of its directors,
officers and employees and any person who controls the Company
within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act from and against any loss, expense, liability
or claim (including the reasonable cost of investigation)
which, jointly or severally, the Company or any such person may
incur under the Act or otherwise, insofar as such loss,
expense, liability or claim arises out of or is based upon any
untrue statement or alleged untrue statement of a material fact
contained in and in conformity with information furnished in
writing by or on behalf of such Underwriter to the Company
expressly for use with reference to such Underwriter in the
Registration Statement (or in the Registration Statement as
amended by any post-effective amendment thereof by the Company)
or in a Prospectus, or arises out of or is based upon any omis-
sion or alleged omission to state a material fact in connection
with such information required to be stated either in such Reg-
istration Statement or Prospectus or necessary to make such
information not misleading.
<PAGE>
<PAGE>
-25-
If any action is brought against the Company or any
such person in respect of which indemnity may be sought against
any Underwriter pursuant to the foregoing paragraph, the Com-
pany or such person shall promptly notify such Underwriter in
writing of the institution of such action and such Underwriter
shall assume the defense of such action, including the employ-
ment of counsel and payment of reasonable expenses. The Com-
pany or such person shall have the right to employ its or his
own counsel in any such case, but the fees and expenses of such
counsel shall be at the expense of the Company or such person
unless the employment of such counsel shall have been autho-
rized in writing by such Underwriter in connection with the
defense of such action or such Underwriter shall not have
employed counsel to have charge of the defense of such action
or such indemnified party or parties shall have reasonably con-
cluded that there may be defenses available to it or them which
are different from or additional to those available to such
Underwriter (in which case such Underwriter shall not have the
right to direct the defense of such action on behalf of the
indemnified party or parties), in any of which events such fees
and expenses shall be borne by such Underwriter and paid as
incurred. Anything in this paragraph to the contrary notwith-
standing, no Underwriter shall be liable for any settlement of
any such claim or action effected without the written consent
of such Underwriter, which consent shall not be unreasonably
withheld.
(c) If the indemnification provided for in this
Section 6 is unavailable to an indemnified party under subsec-
tion (a) or (b) of this Section 6 in respect of any losses,
damages, expenses, liabilities or claims referred to therein,
then each applicable indemnifying party, in lieu of indemnify-
ing such indemnified party, shall contribute to the amount paid
or payable by such indemnified party as a result of such
losses, expenses, liabilities or claims (i) 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
hand from the offering of the Securities or (ii) if the alloca-
tion provided by clause (i) above is not permitted by appli-
cable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but
also the relative fault of the Company on the one hand and of
the Underwriters on the other in connection with the statements
or omissions which resulted in such losses, expenses, liabili-
ties or claims, as well as any other relevant equitable consid-
erations. The relative benefits received by the Company on the
<PAGE>
<PAGE>
-26-
one hand and the Underwriters on the other shall be deemed to
be in the same proportion as the total proceeds from the offer-
ing (net of underwriting discounts and commissions but before
deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by the Under-
writers. The relative fault of the Company on the one hand and
of the Underwriters on the other shall be determined by refer-
ence to, among other things, whether the untrue statement or
alleged untrue statement of a material fact or omission or
alleged omission relates to information supplied by the Company
or by the Underwriters and the parties' relative intent, knowl-
edge, access to information and opportunity to correct or pre-
vent such statement or omission. The amount paid or payable by
a party as a result of the losses, expenses, liabilities and
claims referred to above shall be deemed to include any legal
or other fees or expenses reasonably incurred by such party in
connection with investigating or defending any claim or action.
(d) The Company and the Underwriters agree that it
would not be just and equitable if contribution pursuant to
this Section 6 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 that does not take account
of the equitable considerations referred to in Section 6(c)
above. Notwithstanding the provisions of this Section 6, no
Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the
Securities underwritten by such Underwriter 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 statement or alleged untrue state-
ment or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Sec-
tion 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresenta-
tion. The Underwriters' obligations to contribute pursuant to
this Section 6 are several in proportion to their respective
underwriting commitments and not joint.
(e) The indemnity and contribution agreements con-
tained in this Section 6 and the covenants, warranties and rep-
resentations of the Company contained in this Agreement shall
remain in full force and effect irrespective of any investiga-
tion made by or on behalf of any Underwriter, or any of its
oficers, employees, directors or person who controls any Under-
writer within the meaning of Section 15 of the Act or Section
<PAGE>
<PAGE>
-27-
20 of the Exchange Act, or by or on behalf of the Company, its
directors, officers, employees or any person who controls the
Company within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, and shall survive any termina-
tion of this Agreement or the issuance and delivery of the
Securities. The Company and each Underwriter agree promptly to
notify the others of the commencement of any litigation or pro-
ceeding against it and, in the case of the Company, against any
of the Company's officers and directors in connection with the
issuance and sale of the Securities, or in connection with the
Registration Statement or Prospectus.
SECTION 7. Representations, Warranties and Agree-
ments to Survive Delivery. All representations, warranties,
and agreements contained in this Agreement and the Pricing
Agreement, or contained in certificates of officers of the Com-
pany submitted pursuant hereto, shall remain operative and in
full force and effect, regardless of any investigation made by
or on behalf of any Underwriter or any of its respective offic-
ers, employees, directors or person who controls any Under-
writer, or by or on behalf of the Company, and shall survive
delivery of the Securities to and payment for the Securities by
the Underwriters.
SECTION 8. Termination of Agreement. (a) The
Underwriters may terminate this Agreement, by notice to the
Company (i) if there shall occur any default or breach by the
Company hereunder or the failure to satisfy any of the condi-
tions contained in Section 5 hereof, (ii) if there has been,
since the date of this Agreement or since the respective dates
as of which information is provided in the Registration State-
ment and prior to the Closing Date, any Material Adverse Change
or any downgrading of any of the Company's securities or the
placement of any such securities on a so-called "credit watch"
or similar list by any major credit rating agency, or (iii) if,
since the date of this Agreement and prior to the Closing Date,
(A) there has occurred any material adverse change in the
financial markets of the United States or any outbreak of hos-
tilities or other calamity or crisis, the effect of which on
the financial securities markets of the United States is such
as to make it, in the judgment of the Underwriters, impracti-
cable to market the Securities or to enforce contracts for the
sale of the Securities, or (B) trading in any of the securities
of the Company has been suspended by the Commission, or trading
generally on the New York Stock Exchange has been suspended
(other than by limitation on hours or number of days of
<PAGE>
<PAGE>
-28-
trading), or minimum or maximum prices for trading have been
fixed, or maximum ranges for prices for securities have been
required, by the New York Stock Exchange or by order of the
Commission or any other governmental authority or (C) a banking
moratorium has been declared by either Federal or New York
authorities.
(b) If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any
party to any other party except as provided in Section 4.
SECTION 9. Notices. All notices and other communi-
cations hereunder shall be in writing and shall be deemed to
have been duly given if mailed or transmitted by any standard
form of telecommunication. Notices to the Underwriters shall
be directed to the Underwriters, c/o Jefferies & Company, Inc.,
11100 Santa Monica Boulevard, Los Angeles, California 90025,
attention of Jerry Gluck; notices to the Company shall be
directed to it at 315 Park Avenue South, New York, New York
10010, attention of the Secretary of the Company, with a copy
to Weil, Gotshal & Manges at 767 Fifth Avenue, New York, New
York 10153, attention of Stephen E. Jacobs, Esq.
SECTION 10. Parties. This Agreement and the Pricing
Agreement shall each inure to the benefit of and be binding
upon the Underwriters and the Company and their respective suc-
cessors and legal representatives. Nothing expressed or men-
tioned in this Agreement or the Pricing Agreement is intended
or shall be construed to provide any person, firm or corpora-
tion, other than the Underwriters and the Company and their
respective successors and legal representatives and the con-
trolling persons and officers, employees and directors referred
to in Sections 6 and 7 and their respective heirs and legal
representatives, any legal or equitable right, remedy or claim
under or in respect of this Agreement or the Pricing Agreement
or any provision herein or therein contained. This Agreement
and the Pricing Agreement and all conditions and provisions
hereof and thereof are intended to be for the sole and exclu-
sive benefit of the Underwriters and the Company and their
respective successors and legal representatives, and said con-
trolling persons and officers and directors and their respec-
tive heirs and legal representatives, and for the benefit of no
other person, firm or corporation. No purchaser of Securities
from any Underwriter shall be deemed to be a successor by rea-
son merely of such purchase.
<PAGE>
<PAGE>
-29-
SECTION 11. Governing Law and Time. This Agreement
and the Pricing Agreement shall be governed by and construed in
accordance with the laws of the State of New York applicable to
agreements made and to be performed in said State. Specified
times of day refer to New York City time.
<PAGE>
<PAGE>
-30-
If the foregoing is in accordance with your under-
standing of our agreement, please sign and return to the Com-
pany a counterpart hereof, whereupon this instrument, along
with all counterparts, will become a binding agreement between
the Underwriters and the Company in accordance with its terms.
Very truly yours,
LEUCADIA NATIONAL CORPORATION
By:
-------------------------
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
JEFFERIES & COMPANY, INC.
By:
--------------------------
Name:
Title:
CS FIRST BOSTON CORPORATION
By:
--------------------------
Name:
Title:
PAINEWEBBER INCORPORATED
By:
--------------------------
Name:
Title:
<PAGE>
<PAGE>
SCHEDULE A
----------
Aggregate Principal
Amount of Securities
Name of Underwriter to be Purchased
------------------- --------------------
Jefferies & Company, Inc. ...................... $
CS First Boston Corporation.....................
PaineWebber Incorporated .......................
-------------
Total $ 100,000,000
=============
<PAGE>
<PAGE>
Leucadia National Corporation
(a New York corporation)
$100,000,000
% Senior Subordinated Notes due 2005
PRICING AGREEMENT
-----------------
, 1995
Jefferies & Company, Inc.
11100 Santa Monica Boulevard
Los Angeles, California 90025
CS First Boston Corporation
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
PaineWebber Incorporated
1285 Avenue of the Americas
New York, New York 10019
Dear Sirs:
Reference is made to the Underwriting Agreement dated
, 1995 (the "Underwriting Agreement") between
Leucadia National Corporation, a New York corporation (the
"Company"), and you, relating to the purchase by you from the
Company, subject to the terms and conditions set forth herein
and therein, of $100,000,000 aggregate principal amount of the
Company's % Senior Subordinated Notes due 2005 (the "Securi-
ties"). This Agreement is the Pricing Agreement referred to in
the Underwriting Agreement and capitalized terms used herein
without definition shall have the meanings assigned to them in
the Underwriting Agreement.
Pursuant to Section 2 of the Underwriting Agreement,
the Company agrees with you as follows:
1. The initial public offering price of the Securi-
ties, determined as provided in said Section 2, shall be %
of the principal amount thereof, plus accrued interest, if any,
from , 1995.
<PAGE>
<PAGE>
-2-
2. The purchase price of the Securities to be paid
by the Underwriters shall be % of the principal amount
thereof, plus accrued interest, if any, from ,
1995.
3. The interest rate to be borne by the Securities
shall be % per annum.
4. The Securities will mature on ,
2005.
The Company represents and warrants to the Underwrit-
ers that the representations and warranties of the Company set
forth in Section 1 of the Underwriting Agreement are accurate
as though expressly made at and as of the date hereof.
<PAGE>
<PAGE>
-3-
If the foregoing is in accordance with your under-
standing of our agreement, please sign and return to the Com-
pany a counterpart hereof, whereupon this instrument, along
with all counterparts and together with the Underwriting Agree-
ment, will be a binding agreement between you and the Company
in accordance with its terms and the terms of the Underwriting
Agreement.
Very truly yours,
LEUCADIA NATIONAL CORPORATION
By:
------------------------
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
JEFFERIES & COMPANY, INC.
By:
--------------------------
Name:
Title:
CS FIRST BOSTON CORPORATION
By:
--------------------------
Name:
Title:
PAINEWEBBER INCORPORATED
By:
--------------------------
Name:
Title:
<PAGE>
EXHIBIT 4.1
[Proof of May 24, 1995]
LEUCADIA NATIONAL CORPORATION
and
THE FIRST NATIONAL BANK OF BOSTON, Trustee
--------------------
INDENTURE
Dated as of , 1995
--------------------
$100,000,000
% Senior Subordinated Notes due 2005
<PAGE>
<PAGE>
CROSS-REFERENCE TABLE
TIA Section Indenture Section
310(a)(1) ........................................ 6.10
(a)(2) ....................................... 6.10
(a)(3) ....................................... N.A.
(a)(4) ....................................... N.A.
(a)(5) ....................................... 6.08
(b) .......................................... 6.08; 6.10
(c) .......................................... N.A.
311(a) ........................................... 6.11
(b) .......................................... 6.11
(c) .......................................... N.A.
312(a) ........................................... 2.05
(b) .......................................... 10.03
(c) .......................................... 10.03
313(a) ........................................... 6.06
(b)(1) ....................................... N.A.
(b)(2) ....................................... 6.06
(c) .......................................... 6.06; 10.02
(d) .......................................... 6.06
314(a) ........................................... 3.02; 3.03; 10.02
(b) .......................................... N.A.
(c)(1) ....................................... 10.04
(c)(2) ....................................... 10.04
(c)(3) ....................................... N.A.
(d) .......................................... N.A.
(e) .......................................... 10.05
(f) .......................................... N.A.
315(a) ........................................... 6.01(b)
(b) .......................................... 6.05; 10.02
(c) .......................................... 6.01(a)
(d) .......................................... 6.01(c)
(e) .......................................... 5.11
316(a)(last sentence) ............................10.06
(a)(1)(A) .................................... 5.05
(a)(1)(B) .................................... 5.02; 5.04; 8.02
(a)(2) ....................................... N.A.
(b) .......................................... 5.07
317(a)(1) ........................................ 5.08
(a)(2) ....................................... 5.09
(b) .......................................... 2.04
318(a) ...........................................10.01
--------------------------
N.A. means Not Applicable.
NOTE: This Cross-Reference Table shall not, for any purpose,
be deemed to be part of this Indenture.
<PAGE>
<PAGE>
TABLE OF CONTENTS
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
Page
Section 1.01. Definitions..................................... 1
Section 1.02. Other Definitions............................... 10
Section 1.03. Incorporation by Reference of Trust
Indenture Act................................. 10
Section 1.04. Rules of Construction........................... 11
ARTICLE TWO
THE SECURITIES
Section 2.01. Form and Dating................................. 12
Section 2.02. Execution and Authentication.................... 12
Section 2.03. Registrar and Paying Agent...................... 13
Section 2.04. Paying Agent To Hold Money in Trust............. 13
Section 2.05. Securityholder Lists............................ 14
Section 2.06. Transfer and Exchange........................... 14
Section 2.07. Replacement Securities.......................... 14
Section 2.08. Outstanding Securities.......................... 15
Section 2.09. Temporary Securities............................ 15
Section 2.10. Cancellation.................................... 15
Section 2.11. Defaulted Interest.............................. 16
ARTICLE THREE
COVENANTS
Section 3.01. Payment of Securities........................... 16
Section 3.02. SEC Reports..................................... 16
Section 3.03. Compliance Certificate.......................... 17
Section 3.04. Maintenance of Office or Agency................. 18
Section 3.05. Corporate Existence............................. 18
Section 3.06. Waiver of Stay, Extension or Usury
Laws.......................................... 19
Section 3.07. Transactions with Affiliates.................... 19
Section 3.08. Limitation on Dividend and Other
Payment Restrictions Affecting
Subsidiaries.................................. 20
Section 3.09. Limitation on Restricted Payments
and Restricted Investments.................... 20
Section 3.10. Maintenance of Consolidated Tan-
gible Net Worth............................... 21
-i-
<PAGE>
<PAGE>
Page
Section 3.11. Change of Control............................... 25
Section 3.12. Limitation on Incurrence of Addi-
tional Indebtedness by the Com-
pany and on Incurrence of Addi-
tional Indebtedness and Issuance
of Preferred Stock by Its
Subsidiaries.................................. 28
Section 3.13. Limitation on Issuance of Other
Subordinated Debt............................. 28
Section 3.14. Restriction on Investments by
Insurance Subsidiaries........................ 28
Section 3.15. Limitation on Certain Payments or
Investments................................... 29
ARTICLE FOUR
SUCCESSOR CORPORATION
Section 4.01. When Company May Merge, etc..................... 30
Section 4.02. Successor Corporation Substituted............... 31
ARTICLE FIVE
DEFAULTS AND REMEDIES
Section 5.01. Events of Default............................... 32
Section 5.02. Acceleration.................................... 33
Section 5.03. Other Remedies.................................. 34
Section 5.04. Waiver of Past Defaults......................... 34
Section 5.05. Control by Majority............................. 35
Section 5.06. Limitation on Remedies.......................... 35
Section 5.07. Rights of Holders to Receive
Payment....................................... 36
Section 5.08. Collection Suit by Trustee...................... 36
Section 5.09. Trustee May File Proofs of Claim................ 36
Section 5.10. Priorities...................................... 36
Section 5.11. Undertaking for Costs........................... 37
ARTICLE SIX
TRUSTEE
Section 6.01. Duties of Trustee............................... 37
Section 6.02. Rights of Trustee............................... 39
Section 6.03. Individual Rights of Trustee.................... 39
Section 6.04. Trustee's Disclaimer............................ 40
Section 6.05. Notice of Defaults.............................. 40
Section 6.06. Reports by Trustee to Holders................... 40
-ii-
<PAGE>
<PAGE>
Page
Section 6.07. Compensation and Indemnity...................... 40
Section 6.08. Replacement of Trustee.......................... 42
Section 6.09. Successor Trustee by Merger, etc................ 43
Section 6.10. Eligibility; Disqualification................... 43
Section 6.11. Preferential Collection of Claims
Against Company............................... 43
ARTICLE SEVEN
DISCHARGE OF INDENTURE
Section 7.01. Termination of Company's
Obligations................................... 43
Section 7.02. Application of Trust Money...................... 44
Section 7.03. Repayment to Company............................ 44
Section 7.04. Reinstatement................................... 45
ARTICLE EIGHT
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 8.01. Without Consent of Holders...................... 45
Section 8.02. With Consent of Holders......................... 46
Section 8.03. Compliance with Trust Indenture Act............. 47
Section 8.04. Revocation and Effect of Consents............... 47
Section 8.05. Notation on or Exchange of
Securities.................................... 48
Section 8.06. Trustee Protected............................... 48
ARTICLE NINE
SUBORDINATION
Section 9.01. Securities Subordinated to Senior
Indebtedness.................................. 48
Section 9.02. Company Not To Make Payments with
Respect to Securities in Certain
Circumstances................................. 49
Section 9.03. Securities Subordinated to Prior
Payment of All Senior Indebted-
ness on Dissolution, Liquidation
or Reorganization of Company.................. 50
Section 9.04. Securityholders To Be Subrogated to
Rights of Holders of Senior
Indebtedness.................................. 51
Section 9.05. Obligation of the Company
Unconditional................................. 52
-iii-
<PAGE>
<PAGE>
Page
Section 9.06. Trustee Entitled To Assume Payments
Not Prohibited in Absence of
Notice........................................ 53
Section 9.07. Application by Trustee of Monies
Deposited with It............................. 53
Section 9.08. Subordination Rights Not Impaired
by Acts or Omissions of Company
or Holders of Senior Indebtedness............. 54
Section 9.09. Securityholders Authorize Trustee
To Effectuate Subordination of
Securities.................................... 54
Section 9.10. Right of Trustee To Hold Senior
Indebtedness.................................. 55
Section 9.11. Article Nine Not To Prevent Events
of Default.................................... 55
Section 9.12. Ranking; Designation............................ 55
ARTICLE TEN
MISCELLANEOUS
Section 10.01. Trust Indenture Act Controls.................... 55
Section 10.02. Notices......................................... 56
Section 10.03. Communication by Holders with Other
Holders....................................... 57
Section 10.04. Certificate and Opinion as to Con-
ditions Precedent............................. 57
Section 10.05. Statements Required in Certificate
or Opinion.................................... 57
Section 10.06. When Treasury Securities
Disregarded................................... 58
Section 10.07. Rules by Trustee and Agents..................... 58
Section 10.08. Legal Holidays.................................. 58
Section 10.09. Governing Law................................... 58
Section 10.10. No Adverse Interpretation of Other
Agreements.................................... 58
Section 10.11. No Recourse Against Others...................... 59
Section 10.12. Successors...................................... 59
Section 10.13. Duplicate Originals............................. 59
Section 10.14. Separability.................................... 59
SIGNATURES........................................................ 60
EXHIBIT A - FORM OF SECURITY........................................ A-1
--------------------
NOTE: This Table of Contents shall not, for any purpose, be
deemed to be a part of this Indenture.
-iv-
<PAGE>
<PAGE>
INDENTURE dated as of , 1995 between
Leucadia National Corporation, a New York corporation (the
"Company"), and The First National Bank of Boston, as trustee
(the "Trustee").
Each party agrees as follows for the benefit of the
other party and for the equal and ratable benefit of the hold-
ers of the Company's % Senior Subordinated Notes due
, 2005 (the "Securities"):
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Acquired Indebtedness" means Indebtedness or Pre-
ferred Stock of a Person either (i) existing at the time such
Person becomes a Subsidiary, (ii) assumed in connection with
the acquisition of assets of such Person or (iii) any refinanc-
ing or replacement by such Person of such Indebtedness or Pre-
ferred Stock; provided, that the aggregate amount of such
Indebtedness or Preferred Stock then outstanding is not
increased. Acquired Indebtedness shall not include (x) any
such Indebtedness created or Preferred Stock issued in antici-
pation of such Person becoming a Subsidiary (other than a refi-
nancing or replacement of Indebtedness or Preferred Stock of
such Person, which original Indebtedness or Preferred Stock was
not incurred or issued in anticipation of such Person becoming
a Subsidiary) or (y) any Indebtedness or Preferred Stock that
is recourse to the Company or any Subsidiary or any of their
respective assets, other than to such Person and its Subsidiar-
ies and their respective assets.
"Affiliate" of the Company means (i) any Related Per-
son and (ii) any other Person directly or indirectly control-
ling or controlled by or under direct or indirect common con-
trol with the Company. For the purposes of this definition,
"control" when used with respect to any Person means the power
to direct the management and policies of such Person, directly
or indirectly, whether through the ownership of voting securi-
ties, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Agent" means any Registrar, Paying Agent or co-
registrar.
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"Board of Directors" means the Board of Directors of
the Company or any committee thereof.
"Board Resolution" means a copy of a resolution cer-
tified by the Secretary or an Assistant Secretary of the Com-
pany 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.
"business day" means any day on which the New York
Stock Exchange is open for trading and which is not a Legal
Holiday.
"Capitalized Lease" means any lease which is, in
accordance with GAAP, capitalized on the balance sheet of the
lessee.
"Capitalized Lease Obligations" means the discounted
present value of the rental obligations of any Person under any
lease of any property (whether real, personal or mixed) which,
in accordance with GAAP, is required to be capitalized on the
balance sheet of such Person.
"Capital Stock" means, with respect to any Person,
any and all shares, interests, participations or other equiva-
lents (however designated) of capital stock, including each
class of common stock and preferred stock of such Person.
"Cash Equivalents" shall mean (i) securities issued
or directly and fully guaranteed or insured by the United
States or any agency or instrumentality thereof, (ii) U.S. dol-
lar denominated time deposits, certificates of deposit,
eurodollar time deposits, eurodollar certificates of deposit,
and bankers acceptances of any domestic commercial bank of rec-
ognized standing having capital and surplus in excess of
$500,000,000, (iii) commercial paper having a rating from Stan-
dard & Poor's Corporation ("S&P") of at least A-2 or the
equivalent thereof or from Moody's Investors Service, Inc.
("Moody's") of at least P-2 or the equivalent thereof or from
Duff & Phelps Inc. ("Duff & Phelps") of at least D-2 or the
equivalent thereof and maturing within nine months from the
date of acquisition, and (iv) tax-exempt commercial paper of
United States municipal, state or local governments rated at
least A-2 or the equivalent thereof by S&P or at least P-2 or
the equivalent thereof by Moody's or at least D-2 or the
equivalent thereof by Duff & Phelps and maturing within nine
months from the date of acquisition.
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"Certain Payment or Investment" shall be deemed to
occur on the first day on which the aggregate Restricted Pay-
ments and Restricted Investments exceed by $100,000,000 (calcu-
lated on the date of payment or investment) the amount of
Restricted Payments and Restricted Investments that could
otherwise be made pursuant to Section 3.09 if gains on sales of
segments, businesses or major lines of business, net of losses
on such sales (whether sold as assets or stock), had been
excluded from the definition of "Consolidated Net Income".
"Common Shares" means the Common Shares, par value
$1.00 per share, of the Company.
"Company" means Leucadia National Corporation, a New
York corporation, until a successor replaces such Person in
accordance with the terms of this Indenture, and thereafter
means such successor.
"Consolidated Debt" means, on any date, the sum of
(i) total Indebtedness of the Company and its Subsidiaries, at
such date, determined in accordance with GAAP on a consolidated
basis, and (ii) the aggregate liquidation preference of all
Preferred Stock of Subsidiaries of the Company, at such date,
other than Preferred Stock to the extent held by the Company
and its Subsidiaries; provided, that Consolidated Debt shall
not include Permitted Indebtedness.
"Consolidated Net Income" and "Consolidated Net Loss"
mean, for any period, the net income or loss, as the case may
be, of the Company and its Subsidiaries for such period deter-
mined on a consolidated basis in accordance with GAAP (pro-
vided, that, for periods ended prior to January 1, 1995, Con-
solidated Net Income shall mean the reported income before
cumulative effects of changes in accounting principles of the
Company and its Subsidiaries); provided, that there shall be
excluded therefrom (to the extent otherwise included therein)
(i) the net income (or net loss) of any Person that is not the
Company or a Subsidiary of the Company, except net income of
such Person may be included to the extent of the amount of div-
idends or other distributions actually paid or made to the Com-
pany or any of its Subsidiaries by such other Person during
such period, (ii) except to the extent includible pursuant to
the foregoing clause (i), the net income (or net loss) of any
other Person accrued prior to the date it becomes a Subsidiary
of the Company or is merged into or consolidated with the Com-
pany or any of its Subsidiaries or such other Person's assets
are acquired by the Company or any of its Subsidiaries,
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(iii) all extraordinary gains, to the extent they exceed extra-
ordinary losses, in each case, determined in accordance with
GAAP and (iv) all gains or losses resulting from the effect of
any accounting change.
"Consolidated Net Worth" means, as of any date, the
sum of the Capital Stock and additional paid-in capital plus
retained earnings (or minus accumulated deficit) of the Company
as of such date determined on a consolidated basis in accor-
dance with GAAP.
"Consolidated Tangible Net Worth" with respect to the
Company means, as of any date, the total shareholders' equity
of the Company determined in accordance with GAAP less (a) (to
the extent not otherwise deducted from total shareholders'
equity at such date) the amount of Restricted Investments of
the Company and its Subsidiaries outstanding on such date and
(b) any and all goodwill and other intangible assets reflected
on the consolidated balance sheet of the Company as of such
date. Deferred policy acquisition costs ("DPAC") and that por-
tion of the value of insurance in force resulting from an
acquisition and equivalent to the amount of DPAC of the
acquired entity outstanding immediately prior to such acquisi-
tion shall not be deemed goodwill or other intangible assets
for purposes of determining Consolidated Tangible Net Worth.
"Default" means any event which is, or after notice
or passage of time would be, an Event of Default.
"Exchange Act" means the Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated by
the SEC thereunder.
"5 1/4% Debentures" mean the Company's 5 1/4% Con-
vertible Subordinated Debentures due 2003.
"GAAP" or "generally accepted accounting principles"
means United States generally accepted accounting principles as
in effect on December 31, 1994, without giving effect to the
Company's adoption after such date of any change in its appli-
cation of GAAP.
"Holder" or "Securityholder" means a Person in whose
name a Security is registered on the Registrar's books.
"Indebtedness" of any Person means (i) any liability
of such Person (a) for borrowed money, (b) evidenced by a note,
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debenture or similar instrument (including a Purchase Money
Obligation or deferred payment obligation) given in connection
with the acquisition of any property or assets (other than
inventory or similar property acquired in the ordinary course
of business), including securities, (c) for the payment of a
Capitalized Lease Obligation of such Person or (d) with respect
to the reimbursement of any letter of credit, banker's accep-
tance or similar credit transaction (other than trade letters
of credit issued in the ordinary course of business; provided,
that the failure to make prompt reimbursement of any trade let-
ter of credit shall be deemed to be the incurrence of Indebted-
ness); and (ii) any guarantee by such Person of any liability
of others described in clause (i) above or any obligation of
such Person with respect to any liability of others described
in clause (i) above. Indebtedness shall not include deposits
at the Company's banking and lending Subsidiaries.
"Indenture" means this Indenture as amended or sup-
plemented from time to time.
"Independent Director" means any director of the Com-
pany who is neither (i) an executive officer or an employee of
the Company or of any of its Subsidiaries or Affiliates or
(ii) a Related Person.
"Investment" means any direct or indirect advance,
loan (other than advances or loans to customers in the ordinary
course of business, which are recorded at the time made as
accounts receivable on the balance sheet of the Person making
such advance or loan) or other extension of credit or capital
contribution to (by means of any transfer of cash or other
property to others or any payment for property or services for
the account or use of others), or any purchase or acquisition
of Capital Stock, bonds, notes, debentures, evidences of
Indebtedness or other securities issued by, any other Person.
"Investment Grade" is defined as BBB- or higher by
S&P or Baa3 or higher by Moody's or the equivalent of such rat-
ings by Moody's or S&P.
"Investment Grade Securities" means (i) securities
having any of the following ratings: at least BBB- or the
equivalent thereof by S&P or at least Baa3 or the equivalent
thereof by Moody's or at least BBB- or the equivalent thereof
by Duff & Phelps or (ii) cash or Cash Equivalents.
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"Material Subsidiary" means (i) any Subsidiary of the
Company which at December 31, 1994 was a "significant subsid-
iary" under Regulation S-X promulgated by the SEC or any suc-
cessor to such Subsidiary and (ii) any other Subsidiary of the
Company; provided, that the Company's investments in and
advances to such Subsidiary at the date of determination
thereof, without giving effect to any write downs in such
investments or advances taken within the prior 12 months, rep-
resent 20% or more of the Company's Consolidated Tangible Net
Worth as of such time; provided, however, that this clause (ii)
shall not include any Subsidiary if, at the time that it became
a Subsidiary, the Company contemplated commencing a voluntary
case or proceeding under the Bankruptcy Law with respect to
such Subsidiary.
"Minimum Tangible Net Worth" means $250,000,000.
"Obligations" means any principal, interest, penal-
ties, fees, indemnities and other obligations and liabilities
payable under the documentation governing the applicable
Indebtedness.
"Officer" means the Chairman of the Board, the Presi-
dent, any Vice President, the Chief Financial Officer or the
Treasurer of the Company.
"Officers' Certificate" means a certificate signed by
two Officers or by an Officer and the Secretary, Assistant Sec-
retary or Assistant Treasurer of the Company.
"Opinion of Counsel" means a written opinion from
legal counsel who is reasonably acceptable to the Trustee. The
counsel may be an employee of or counsel to the Company or the
Trustee.
"Permitted Indebtedness" means (i) any Indebtedness
of the Company and its Subsidiaries outstanding on the date of
this Indenture or any refinancing or replacement thereof; pro-
vided, that the aggregate amount of such Indebtedness is not
increased, (ii) Acquired Indebtedness, (iii) Preferred Stock of
Subsidiaries held by the Company or its Subsidiaries (it being
understood that the sale of such Preferred Stock by the Company
or such Subsidiary to any Person other than the Company or a
Subsidiary of the Company or such Subsidiary no longer being a
Subsidiary shall be deemed the issuance of Preferred Stock for
purposes of Section 3.12) and (iv) intercompany Indebtedness.
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"Person" means any individual, corporation, partner-
ship, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or
political subdivision thereof.
"Preferred Stock" of an entity means the Capital
Stock of that entity which is preferred as to the payment of
dividends or the distribution of assets on any voluntary or
involuntary liquidation, over the shares of any other class or
series of Capital Stock of said entity.
"principal" of a debt security means the principal
amount of the security plus the premium, if any, on the
security.
"Purchase Money Obligations" means indebtedness evi-
denced by a note, debenture, bond or other security or invest-
ment (whether or not secured by any lien or other security
interest) issued to or assumed in favor of a vendor as all or
part of the purchase price of property acquired by the Company
or any Subsidiary; provided, however, that such term shall not
include any account payable or any other indebtedness incurred,
created or assumed in the ordinary course of business in con-
nection with the obtaining of material, products or services.
"Related Person" means any Person who directly or
indirectly holds 10% or more of any class of Capital Stock of
the Company as determined pursuant to Rule 13d-3 under the
Exchange Act.
"Restricted Investment" means, with respect to the
Company or any Subsidiary of the Company, an Investment by such
Person in an Affiliate of the Company (other than (x) in the
Company or a Subsidiary of the Company or (y) in a Person that
is an Affiliate of the Company solely because of (i) the owner-
ship of securities of such Person by the Company or its Subsid-
iaries, (ii) contractual arrangements between the Company and
its Subsidiaries and such Person or (iii) a combination of (i)
and (ii)).
"Restricted Payment" means (i) the declaration or
making of any dividend or of any other payment or distribution
on or with respect to the Company's Capital Stock (other than
dividends, payments or distributions payable solely in shares
of the Company's Capital Stock), (ii) any payment on account of
the purchase, redemption, retirement or other acquisition for
value of the Company's Capital Stock; provided, that so long as
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there shall not be a Default or Event of Default under this
Indenture, any payment to the estate of Ian M. Cumming or
Joseph S. Steinberg (or any trustee or other legal representa-
tive on behalf of the legatees or heirs of such Persons) on
account of the repurchase or redemption of Voting Stock owned
by such estates (or trustees or legal representatives), solely
from the net proceeds of any life insurance maintained by the
Company on either of such Persons, shall not be a Restricted
Payment and (iii) the declaration or making of any dividend or
any other payment or distribution with respect to the Capital
Stock of any Subsidiary of the Company and any payment on
account of the purchase, redemption, retirement or other acqui-
sition for value of the Capital Stock of any Subsidiary of the
Company but, with respect to this clause (iii), only to the
extent such dividend, payment or distribution is received by an
Affiliate of the Company (other than (x) the Company or a Sub-
sidiary of the Company or (y) a Person that is an Affiliate of
the Company solely because of (A) the ownership of securities
of such Person by the Company or its Subsidiaries,
(B) contractual arrangements between the Company and its Sub-
sidiaries and such Person or (C) a combination of (A) and (B)).
"SEC" means the Securities and Exchange Commission.
"Securities" means the securities, as amended or sup-
plemented from time to time, that are issued and outstanding
under this Indenture.
"Senior Indebtedness" means all Obligations of the
Company with respect to the following, whether outstanding at
the date of original execution of this Indenture or thereafter
incurred, created or assumed: (a) indebtedness of the Company
for money borrowed, including, without limitation, indebtedness
of the Company for money borrowed which is evidenced by notes,
debentures, bonds or other securities issued under the provi-
sions of an indenture or other instrument, and also including
indebtedness represented by Purchase Money Obligations, but
only to the extent such indebtedness is enforceable by a money
judgment; (b) guarantees or assumptions by the Company of
indebtedness of others of any of the kinds described in the
preceding clause (a); and (c) renewals, extensions and
refundings of, and indebtedness of a successor corporation
issued in exchange for or in replacement of, indebtedness,
guarantees and assumptions of the kinds described in the pre-
ceding clauses (a) or (b), unless, in the case of any particu-
lar indebtedness, obligation, guarantee, assumption, renewal,
extension or refunding, the instrument creating or evidencing
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the same expressly provides that such indebtedness, obligation,
guarantee, assumption, renewal, extension or refunding is not
superior in right of payment to the Securities; provided, that
Senior Indebtedness shall not be deemed to include (i) any
indebtedness of the Company to any Subsidiary, (ii) any lia-
bility for taxes, (iii) any amounts payable or other liabili-
ties to trade creditors arising in the ordinary course of busi-
ness, (iv) any indebtedness which is subordinate or junior by
its terms to any other Indebtedness of the Company, (v) the
10 3/8% Notes, (vi) the 5 1/4% Debentures or (vii) the Swiss
Franc Bonds.
"Subsidiary" means a corporation or business trust a
majority of whose Voting Stock is owned by the Company or a
Subsidiary.
"Swiss Franc Bonds" means the Company's 6% Subordi-
nated Swiss Franc Bonds due 1996.
"10 3/8% Notes" means the Company's 10 3/8% Senior
Subordinated Notes due 2002.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.
Code Sections 77aaa-77bbbb) as in effect on the date of this
Indenture.
"Trustee" means the party named as such in this
Indenture until a successor replaces it and thereafter means
the successor.
"Trust Officer" means any officer or assistant offi-
cer within the corporate trust department of the Trustee
assigned by the Trustee to administer its corporate trust
matters.
"United States" means the United States of America.
"U.S. Legal Tender" means such coin or currency of
the United States as at the time of payment shall be legal ten-
der for the payment of public and private debts.
"Voting Stock" with respect to any Person, means Cap-
ital Stock of such Person having general voting power under
ordinary circumstances to elect directors to the board of
directors of such Person, but shall not include any Capital
Stock that has or would have such voting power solely by reason
of the happening of any contingency.
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"Wholly-Owned Subsidiary" means any Subsidiary in
which the Company or a Subsidiary owns all of the Capital
Stock, other than directors qualifying shares.
SECTION 1.02. Other Definitions.
Defined
Term in Section
"Bankruptcy Law".......................... 5.01
"Certain Payment or
Investment Notice"...................... 3.15
"Certain Payment or Investment
Payment Date"........................... 3.15
"Change of Control"....................... 3.11
"Change of Control Notice"................ 3.11
"Change of Control Payment Date".......... 3.11
"Custodian"............................... 5.01
"Deficiency Date"......................... 3.10
"Disposition"............................. 3.11
"Event of Default"........................ 5.01
"Legal Holiday"........................... 10.08
"Offer"................................... 3.10
"Offer Amount"............................ 3.10
"Offer Payment Date"...................... 3.10
"Paying Agent"............................ 2.03
"Recipient"............................... 3.11
"Registrar"............................... 2.03
"U.S. Government Obligations"............. 7.01
SECTION 1.03. Incorporation by Reference of Trust
Indenture Act.
Whenever this Indenture refers to a provision of the
TIA, the provision is incorporated by reference in and made a
part of this Indenture. The following TIA terms, if used in
this Indenture, have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
"indenture security holder" means a securityholder.
"indenture to be qualified" means this Indenture.
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"indenture trustee" or "institutional trustee" means
the Trustee.
"obligor" on the indenture securities means the
Company.
All other TIA terms used in this indenture that are
defined by the TIA, defined by TIA reference to another statute
or defined by SEC rule have the meanings assigned to them
therein.
SECTION 1.04. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to
it;
(2) an accounting term not otherwise
defined has the meaning assigned to it in accor-
dance with generally accepted accounting
principles;
(3) "or" is not exclusive;
(4) words in the singular include the
plural, and words in the plural include the
singular;
(5) any gender used in this Indenture
shall be deemed to include the neuter, masculine
or feminine genders;
(6) provisions apply to successive
events and transactions; and
(7) "herein", "hereof" and other words
of similar import refer to this Indenture as a
whole and not to any particular Article, Section
or other Subdivision.
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ARTICLE TWO
THE SECURITIES
SECTION 2.01. Form and Dating.
The Securities and the certificate of authentication
shall be substantially in the form of Exhibit A. The provi-
sions of Exhibit A are part of this Indenture. The Securities
may have notations, legends and endorsements required by law,
stock exchange rule or usage. The Company shall approve the
form of the Securities and any notation, legend or endorsement
on them. Each Security shall be dated the date of its
authentication.
SECTION 2.02. Execution and Authentication.
One Officer and the Secretary or an Assistant Secre-
tary of the Company shall sign the Securities for the Company
by facsimile signature. The Company's seal shall be reproduced
on the Securities.
If an Officer whose signature is on a Security no
longer holds that office at the time the Security is authenti-
cated, the Security shall be valid nevertheless.
A Security shall not be valid until the Trustee or an
authenticating agent mutually signs the certificate of authen-
tication on the Security. The signature shall be conclusive
evidence that the Security has been authenticated under this
Indenture.
The Trustee or an authenticating agent shall authen-
ticate Securities for original issue in the aggregate principal
amount of $100,000,000, upon a written order of the Company
signed by two Officers or by an Officer and the Secretary or an
Assistant Secretary of the Company. The aggregate principal
amount of Securities outstanding at any time may not exceed
$100,000,000, except as provided in Section 2.07.
The Trustee may appoint an authenticating agent to
authenticate Securities. An authenticating agent may authenti-
cate Securities whenever the Trustee may do so except on origi-
nal issuance. Each reference in this Indenture to authentica-
tion by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal
with the Company or its Affiliates.
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The Securities shall be issuable only in registered
form without coupons and only in denominations of $1,000 and
any integral multiple thereof.
SECTION 2.03. Registrar and Paying Agent.
The Company shall maintain an office or agency where
Securities may be presented for registration of transfer or for
exchange (the "Registrar") and an office or agency where Secu-
rities may be presented for payment (the "Paying Agent"). The
Registrar shall keep a register of the Securities and of their
transfer and exchange. The Company may have one or more co-
registrars and one or more additional paying agents. The term
"Paying Agent" includes any additional paying agent.
The Company shall enter into an appropriate agency
agreement with any Agent not a party to this Indenture. Such
agency agreement shall provide for reasonable compensation for
such services. The agreement shall implement the provisions of
this Indenture that relate to such Agent. The Company shall
notify the Trustee of the name and address of any such Agent
and shall furnish the Trustee with an executed counterpart of
any such agency agreement. If the Company fails to maintain or
act as Registrar or Paying Agent, the Trustee shall act as such
and shall be duly compensated therefor.
The Registrar or a co-registrar and a Paying Agent
shall be maintained by the Company in the Borough of Manhattan,
The City of New York. The Company initially designates the
Trustee as the Registrar and Paying Agent.
SECTION 2.04. Paying Agent To Hold Money in Trust.
On or prior to each due date of the principal and
interest on any Security, the Company shall deposit with the
Paying Agent immediately available funds sufficient to pay such
principal and interest becoming due. The Company shall require
each Paying Agent other than the Trustee to hold in trust for
the benefit of Securityholders or the Trustee all money held by
such Paying Agent for the payment of principal or interest on
the Securities, and shall notify the Trustee of any Default by
the Company in making any such payment. While any such Default
continues, the Trustee may require the Paying Agent to pay all
money held by it to the Trustee. Except as provided in the
immediately preceding sentence, the Company at any time may
require a Paying Agent to pay all money held by it to the Trus-
tee. Upon doing so, such Paying Agent (other than the Company
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or a Subsidiary) shall have no further liability for the money.
If the Company acts as Paying Agent, it shall segregate and
hold as separate trust funds all money held by it as Paying
Agent.
SECTION 2.05. Securityholder Lists.
The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of
the name and addresses of Securityholders and shall otherwise
comply with TIA Section 312(a). If the Trustee is not the Registrar,
the Company shall furnish or cause to be furnished to the Trus-
tee on or before each semiannual interest payment date and at
such other times as the Trustee may request in writing a list
in such form and as of such date as the Trustee may reasonably
require of the names and addresses of Securityholders, and the
Company shall otherwise comply with TIA Section 312(a).
SECTION 2.06. Transfer and Exchange.
When a Security is presented to the Registrar or a
co-registrar with a request to register a transfer, the Regis-
trar shall register the transfer as requested if the require-
ments of the Registrar are met. When Securities are presented
to the Registrar or a co-registrar with a request to exchange
them for an equal principal amount of Securities of other
denominations, the Registrar shall make the exchange as
requested if the requirements of the Registrar are met. The
Company shall cooperate with the Registrar in meeting its
requirements. To permit transfers, registration and exchanges,
the Trustee shall authenticate Securities at the Registrar's
request. The Company may charge a reasonable fee for any
transfer, registration or exchange and may require payment of a
sum sufficient to cover any tax or other governmental charge
that may be imposed in relation thereto, but not for any
exchange pursuant to Sections 2.09 or 8.05.
SECTION 2.07. Replacement Securities.
If a mutilated Security is surrendered to the Trustee
or if the Holder of a Security claims that the Security has
been lost, destroyed or wrongfully taken, the Company shall
issue and the Trustee shall authenticate a replacement Security
if the requirements of the Trustee are met. An indemnity bond
may be required by the Trustee or the Company that is suffi-
cient in the judgment of the Company and the Trustee to protect
the Company, the Trustee or any Agent from any loss which any
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of them may suffer if a Security is replaced. The Company may
charge for its expenses in replacing a Security.
SECTION 2.08. Outstanding Securities.
Securities outstanding at any time are all Securities
authenticated by the Trustee except for those cancelled by it,
those delivered to it for cancellation and those described in
this Section 2.08 as not outstanding. Subject to Section
10.06, a Security does not cease to be outstanding because the
Company or one of its Subsidiaries or Affiliates holds the
Security.
If a Security is replaced pursuant to Section 2.07,
it ceases to be outstanding unless the Trustee receives proof
satisfactory to it that the replaced Security is held by a bona
fide purchaser.
If any Paying Agent (other than the Company or a Sub-
sidiary) holds on the maturity date money received by the Pay-
ing Agent pursuant to this Indenture and sufficient to pay the
principal and interest on Securities payable on that date, then
on and after that date such Securities cease to be outstanding
and interest on them ceases to accrue.
SECTION 2.09. Temporary Securities.
Until definitive Securities are ready for delivery,
the Company may prepare and the Trustee shall authenticate the
temporary Securities. Temporary Securities shall be substan-
tially in the form of definitive Securities but may have varia-
tions that the Company considers appropriate for temporary
Securities. Without unreasonable delay, the Company shall pre-
pare and the Trustee shall authenticate definitive Securities
in exchange for temporary Securities surrendered to it.
SECTION 2.10. Cancellation.
The Company at any time may deliver Securities to the
Trustee for cancellation. The Registrar and Paying Agent shall
forward to the Trustee any Securities surrendered to them for
transfer, exchange or payment. The Trustee and no one else
shall cancel all Securities surrendered for registration,
transfer, exchange, payment or cancellation and shall destroy
cancelled Securities unless the Company directs their return to
the Company. The Company may not issue new Securities to
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replace Securities that it has paid or delivered to the Trustee
for cancellation.
SECTION 2.11. Defaulted Interest.
If the Company defaults in a payment of interest on
the Securities, it shall pay the defaulted interest plus any
interest payable on the defaulted interest to the persons who
are Securityholders on a subsequent special record date. The
Company shall fix the record date and payment date. At least
10 days before the record date, the Company shall mail to each
Securityholder a notice that states the record date, the pay-
ment date, and the amount of defaulted interest to be paid.
The Company may pay defaulted interest in any other lawful
manner.
ARTICLE THREE
COVENANTS
SECTION 3.01. Payment of Securities.
The Company shall pay the principal of and interest
on the Securities on the dates and in the manner provided in
the Securities. An installment of principal or interest shall
be considered paid on the date it is due if the Trustee or Pay-
ing Agent holds such installment in immediately available funds
at 9:00 A.M. on the day two days prior to the date such
installment is due.
The Company shall pay interest on overdue principal
at the rate borne by the Securities; it shall pay interest on
overdue installments of interest at the same rate to the extent
lawful.
SECTION 3.02. SEC Reports.
(a) The Company shall file with the Trustee within
15 days after it files them with the SEC copies of the annual
reports and of the information, documents, and other reports
(or copies of such portions of any of the foregoing as the SEC
may by rules and regulations prescribe) which the Company is
required to file with the SEC pursuant to Section 13 or 15(d)
of the Exchange Act. If the Company is not subject to the
requirements of such Section 13 or 15(d) of the Exchange Act,
the Company shall continue to file with the Trustee on the same
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timely basis such reports, information and other documents as
it would file if it were subject to the requirements of Section
13 or 15(d) of the Exchange Act. The Company also shall comply
with the other provisions of TIA Section 314(a).
(b) So long as any of the Securities remain out-
standing, the Company shall cause each annual, quarterly and
other financial report mailed or otherwise furnished by it gen-
erally to stockholders to be filed with the Trustee and mailed
to the Holders at their addresses appearing in the register of
Securities maintained by the Registrar, in each case at the
time of such mailing or furnishing to stockholders. If the
Company is not required to furnish annual or quarterly reports
to its stockholders pursuant to the Exchange Act, the Company
shall cause its financial statements, including any notes
thereto and, with respect to annual reports, an auditors'
report by an accounting firm of established national reputation
and a "Management's Discussion and Analysis of Financial Condi-
tion and Results of Operations," comparable to that which would
have been required to appear in annual or quarterly reports
filed under Section 13 or 15(d) of the Exchange Act, to be so
filed with the Trustee within 120 days after the end of each of
the Company's fiscal years and within 60 days after the end of
each of the first three quarters of each such fiscal year and,
after the date such reports are so required to be filed with
the Trustee, to be furnished to any Holder upon such Holder's
request.
(c) The Company shall provide the Trustee with a
sufficient number of copies of all reports and other documents
and information that the Trustee may be required to deliver to
Securityholders under this Section 3.02.
SECTION 3.03. Compliance Certificate.
The Company shall deliver to the Trustee within 120
days after the end of each fiscal year of the Company (which as
of the date of this Indenture is December 31) an Officers' Cer-
tificate stating whether or not the signers know of any Default
or Event of Default. If they do know of such a Default or
Event of Default, the certificate shall describe the Default or
Event of Default and efforts to remedy the same. The Company
shall notify the Trustee within 10 days following the occur-
rence thereof of any acceleration which is an Event of Default
within the meaning of Section 5.01(4).
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SECTION 3.04. Maintenance of Office or Agency.
The Company will maintain in the Borough of Manhat-
tan, The City of New York, an office or agency where Securities
may be surrendered for registration of transfer or exchange or
for presentation for payment and where notices and demands to
or upon the Company in respect of the Securities 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 address of the Trustee set forth in
Section 10.02.
The Company may also from time to time designate one
or more other offices or agencies where the Securities may be
presented or surrendered for any or all such purposes and may
from time to time rescind such designations; provided, that no
such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in
the Borough of Manhattan, The City of New York, for such pur-
poses. 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 3.05. Corporate Existence.
Subject to Article Four, the Company will do or cause
to be done all things necessary to preserve and keep in full
force and effect its corporate existence and the corporate,
partnership or other existence of each Material Subsidiary in
accordance with the respective organizational documents of each
Material Subsidiary and the rights (charter and statutory) and
material franchises of the Company and the Material Subsidiar-
ies; provided, that the Company shall not be required to pre-
serve any such right or franchise, or the corporate existence
of any Material Subsidiary, 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, and will not be, adverse in any material
respect to the Holders.
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SECTION 3.06. Waiver of Stay, Extension or Usury Laws.
The Company covenants (to the extent that it may law-
fully do so) that it will not at any time insist upon, plead,
or in any manner whatsoever claim or take the benefit or advan-
tage of, any stay or extension law or any usury law or other
law, which would prohibit or forgive the Company from paying
all or any portion of the principal of and/or interest on the
Securities as contemplated herein, wherever enacted, now or at
any time hereafter in force, or which may affect the covenants
or the performance of this Indenture; and (to the extent that
it may lawfully do so) the Company 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.
SECTION 3.07. Transactions with Affiliates.
The Company shall not, and shall not permit any Sub-
sidiary to, directly or indirectly, enter into any transaction
or series of related transactions with any Affiliate (other
than (a) with the Company or a Wholly-Owned Subsidiary or (b)
the making of a Restricted Payment or Restricted Investment
otherwise permitted by Section 3.09), including, without limi-
tation, any loan, advance or investment or any purchase, sale,
lease or exchange of property or the rendering of any service,
unless such transaction or series of transactions is in good
faith and at arm's-length and on terms which are at least as
favorable as those available in a comparable transaction from
an unrelated Person. Any such transaction that involves in
excess of $10,000,000 shall be approved by a majority of the
Independent Directors on the Board of Directors of the Company;
or, in the event that at the time of any such transaction or
series of related transactions there are no Independent Direc-
tors serving on the Board of Directors of the Company, such
transaction or series of related transactions shall be approved
by a nationally recognized expert with experience in appraising
the terms and conditions of the type of transaction for which
approval is required.
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SECTION 3.08. Limitation on Dividend and Other Payment
Restrictions Affecting Subsidiaries.
The Company shall not, and shall not permit any Sub-
sidiary to, directly or indirectly, create or otherwise cause
to exist or become effective any encumbrance or restriction on
the ability of any Subsidiary to (a) pay dividends or make any
other distributions on its Capital Stock or any other interest
or participation in, or measured by, its profits, owned by the
Company or any Subsidiary, or pay any Indebtedness owed to the
Company or any Subsidiary, (b) make loans or advances to the
Company or any Subsidiary or (c) transfer any of its properties
or assets to the Company, except for such encumbrances or
restrictions existing under or by reasons of (i) applicable
law, (ii) this Indenture, (iii) customary provisions restrict-
ing subletting or assignment of any lease governing a leasehold
interest of the Company or any Subsidiary, (iv) any instrument
governing Acquired Indebtedness, which encumbrance or restric-
tion is not applicable to any Person, or the properties or
assets of any Person, other than such Person and its Subsidiar-
ies, or the property or assets of such Person and its Subsid-
iaries, so acquired, (v) Indebtedness existing on the date of
this Indenture and any refinancing of such existing Indebted-
ness so long as the terms and conditions of any such refinanc-
ing agreements are no less favorable to the Company than those
contained in the agreements governing the Indebtedness being
refinanced or (vi) other Indebtedness; provided, that the Board
of Directors of the Company shall have concluded, in good
faith, that the terms thereof do not have a materially adverse
effect on the Company, on a stand-alone basis, or the Company's
ability, on a stand-alone basis, to meet its obligations.
SECTION 3.09. Limitation on Restricted Payments
and Restricted Investments.
The Company shall not, and shall not permit any Sub-
sidiary to, make, directly or indirectly, any Restricted Pay-
ment or Restricted Investment if, immediately after giving
effect to such Restricted Payment or Restricted Investment, as
the case may be: (a) a Default or Event of Default shall have
occurred and be continuing, (b) the Company's Consolidated Tan-
gible Net Worth would be less than $250,000,000, (c) the Com-
pany would not be permitted to incur at least $1.00 of addi-
tional Indebtedness (other than Permitted Indebtedness) pursu-
ant to Section 3.12(a) hereof or (d) the sum of (x) the aggre-
gate amount expended for all Restricted Payments subsequent to
March 31, 1992 and (y) the aggregate amount of Restricted
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Investments made subsequent to March 31, 1992 and then out-
standing reduced by any write down of any such Restricted
Investment to the extent that such write down otherwise reduced
Consolidated Net Income (the amount so expended for a
Restricted Payment or a Restricted Investment, if other than in
cash, to be determined by the Board of Directors of the Com-
pany, whose determination shall be conclusive and evidenced by
a Board Resolution) would exceed the sum of (1) $35,000,000,
(2) 50% of the aggregate Consolidated Net Income of the Company
(or minus 100% of the aggregate Consolidated Net Loss of the
Company) accrued on a cumulative basis subsequent to March 31,
1992, and (3) the aggregate net proceeds, including the fair
value of property other than cash (as determined by the Board
of Directors of the Company, whose determination shall be con-
clusive and evidenced by a Board Resolution), received by the
Company in respect of the issue or sale subsequent to March 31,
1992 of (i) any shares of Capital Stock of the Company, or (ii)
any Indebtedness of the Company to the extent converted into or
exchanged for Capital Stock of the Company subsequent to March
31, 1992. This Section 3.09 shall not prevent (x) the payment
of any dividend or distribution within 60 days after the date
of declaration thereof, if at such date of declaration such
payment complied with the foregoing provisions, or (y) the
retirement of any shares of the Company's Capital Stock by
exchange for, or upon conversion of, or out of the proceeds of
the substantially concurrent sale (other than to a Subsidiary)
of, other shares of the Capital Stock of the Company, and nei-
ther such retirement, exchange or conversion nor the proceeds
of any such sale shall be included in any computation made
under this Section 3.09.
SECTION 3.10. Maintenance of Consolidated Tangible Net Worth.
(a) If, on the last day of each of any two consecu-
tive fiscal quarters of the Company (the last day of the second
such fiscal quarter being referred to as the "Deficiency
Date"), the Company's Consolidated Tangible Net Worth is less
than the Minimum Tangible Net Worth, then the Company shall, no
later than 65 days after each such Deficiency Date (110 days if
such Deficiency Date is the last day of the Company's fiscal
year), make an offer to all Holders to purchase (an "Offer")
10% of the aggregate principal amount of Securities originally
issued (the "Offer Amount") at a purchase price of 100% of the
principal amount of such Securities, plus accrued interest to
the date of purchase. The Offer shall remain open for a period
of 20 business days following its commencement (unless required
to remain open for a longer period by applicable law) and the
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Company shall purchase for cash the Offer Amount of Securities
on a designated date (the "Offer Payment Date") no later than
five business days after the termination of the Offer or, if
less than the Offer Amount has been tendered, all Securities
then tendered; provided, however, that the Company shall not be
obligated to purchase any of such Securities unless Holders of
at least 10% of the Offer Amount of Securities shall have ten-
dered and not subsequently withdrawn their Securities for
repurchase. If the aggregate principal amount of Securities
tendered to the Company exceeds the Offer Amount, the Company
shall purchase the Securities tendered to it pro rata among
such Securities tendered (with such adjustments as may be
appropriate so that only Securities in denominations of $1,000
and integral multiples thereof shall be purchased). The Com-
pany shall comply with all applicable Federal and state securi-
ties laws in connection with each Offer. In no event shall the
failure of the Company's Consolidated Tangible Net Worth to
equal or exceed the Minimum Tangible Net Worth at the end of
any fiscal quarter be counted toward the making of more than
one Offer.
(b) The Company may reduce the principal amount of
Securities to be purchased pursuant to the Offer by subtracting
100% of the principal amount of Securities acquired by the Com-
pany subsequent to the Deficiency Date through purchase (other-
wise than pursuant to this Section 3.10 or Section 3.11 or 3.15
hereof) or exchange, and surrendered for cancellation. The
Company, however, may not credit Securities that have been pre-
viously used as a credit against any obligation to repurchase
Securities pursuant to this Section 3.10. The Company shall
notify the Trustee prior to the making of any Offer whether the
Company elects to reduce the principal amount of Securities to
be purchased pursuant to an Offer as provided above and set
forth the amount of the credit and the basis provided above for
such credit (including identification of any previously can-
celled Securities not theretofore made the basis for the
credit), and shall deliver such Securities with such notice.
(c) The Company shall furnish the Trustee with an
Officers' Certificate (upon which the Trustee may conclusively
rely) notifying the Trustee that Consolidated Tangible Net
Worth has declined below the Minimum Tangible Net Worth at the
end of any fiscal quarter in which Consolidated Tangible Net
Worth has so declined, if such quarter is one of the first
three quarters of any fiscal year of the Company, within 55
days after the end of such quarter and, if such quarter is the
fourth quarter of any fiscal year of the Company, within 100
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days after the end of such fiscal year; provided, that the
Trustee shall receive such Officers' Certificate at least 15
days prior to any Offer pursuant to Section 3.10(a) and any
Notice of Offer pursuant to Section 3.10(d). The Trustee shall
notify the Holders within 10 days after it receives each such
notice. Failure to give such notice shall not affect the obli-
gations of the Company pursuant to this Section 3.10.
(d) Notice of an Offer shall be prepared and sent,
by first class mail, by the Company to all Holders not less
than 30 days nor more than 60 days before the Offer Payment
Date at their last registered address. The notice shall be
accompanied by a copy of the information regarding the Company
required to be contained in a Quarterly Report filed pursuant
to the Exchange Act on Form 10-Q (x) for the Company's first
fiscal quarter if the Deficiency Date is the last day of the
Company's second fiscal quarter, (y) for the Company's second
fiscal quarter if the Deficiency Date is the last day of the
Company's third fiscal quarter or (z) for the Company's third
fiscal quarter if the Deficiency Date is the last day of the
Company's last fiscal quarter. If the Deficiency Date is the
last day of the Company's first fiscal quarter, a copy of the
information required to be contained in an Annual Report to
Shareholders pursuant to Rule 14a-3 under the Exchange Act for
the fiscal year ending immediately prior to such Deficiency
Date, if available, and in an Annual Report filed pursuant to
the Exchange Act on Form 10-K for such fiscal year shall accom-
pany the notice. If the Company is not subject to the require-
ments of Section 13 or 15(d) of the Exchange Act, the notice
shall be accompanied by financial statements, including any
notes thereto (and, in the case of a fiscal year end, an audi-
tors' report of a firm of established national reputation rea-
sonably satisfactory to the Trustee), comparable to that which
the Company would have been required to include in such Quar-
terly Reports or Annual Report to Shareholders, as the case may
be. The notice shall contain all instructions and materials
necessary to enable such Holders to tender Securities pursuant
to the Offer. The notice, which shall govern the terms of the
Offer, shall state:
(1) that the Offer is being made pursuant to this
Section 3.10;
(2) the Offer Amount, the purchase price (including
the amount of accrued interest) and the Offer Payment
Date;
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(3) whether the Company has elected to reduce the
principal amount of Securities to be purchased pursuant to
an Offer, and has delivered to the Trustee for cancella-
tion the Securities that are to be made the basis for such
reduction and, if so, the amount of such Securities;
(4) that any Security not tendered or accepted for
payment will continue to accrue interest;
(5) that any Security accepted for payment pursuant
to the Offer becomes due and payable on the Offer Payment
Date, and that, unless the Company defaults in making pay-
ment therefor (including, without limitation, if such
default results because such payment is prohibited pursu-
ant to Article Nine hereof), such Security shall cease to
accrue interest after the Offer Payment Date;
(6) that Holders electing to have a Security pur-
chased pursuant to an Offer will be required to surrender
the Security, with the form entitled "Option of Holder to
Elect Purchase" on the reverse of the Security completed
and, if the Offer Payment Date falls between any record
date for the payment of interest on the Securities and the
next succeeding interest payment date, an amount equal to
the interest which the Holder is entitled to receive on
such interest payment date to the Paying Agent at the
address specified in the notice at least five days before
the Offer Payment Date;
(7) that Holders will be entitled to withdraw their
election if the Paying Agent receives, not later than one
business day prior to the Offer Payment Date, a telegram,
telex, facsimile transmission or letter setting forth the
name of the Holder, the principal amount and certificate
numbers of the Securities the Holder delivered for pur-
chase and a statement that such Holder is withdrawing his
election to have the Security purchased;
(8) that if Securities in a principal amount in
excess of the Offer Amount are tendered and not withdrawn
pursuant to the Offer, the Company shall purchase Securi-
ties on a pro rata basis (with such adjustments as may be
deemed appropriate by the Company so that only Securities
in denominations of $1,000 or integral multiples of $1,000
shall be acquired); and
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(9) that Holders whose Securities were purchased
only in part will be issued new Securities equal in prin-
cipal amount to the unpurchased portion of the Securities
surrendered.
Before an Offer Payment Date, the Company shall
(i) accept for payment Securities or portions thereof tendered
pursuant to the Offer (on a pro rata basis if required pursuant
to paragraph (8) above), (ii) deposit with the Paying Agent
U.S. Legal Tender and Securities, if any, acquired in the man-
ner described in clause (b), above, sufficient to pay the pur-
chase price of all Securities or portions thereof so accepted
or to be credited against the Offer Amount and (iii) deliver to
the Trustee Securities so accepted together with an Officers'
Certificate stating the Securities or portions thereof accepted
for payment by the Company. The Paying Agent shall promptly
mail or deliver to Holders of Securities so accepted payment in
an amount equal to the purchase price, and the Company shall
execute and the Trustee shall promptly authenticate and mail or
deliver to such Holders a new Security equal in principal
amount to any unpurchased portion of the Security surrendered.
Any Securities not so accepted shall be promptly mailed or
delivered by the Company to the Holder thereof. The Company
will publicly announce the results of the Offer as soon as
practicable on or after the Offer Payment Date. For purposes
of this Section 3.10, the Trustee shall act as the Paying
Agent.
SECTION 3.11. Change of Control.
(a) In the event of any Change of Control, each
Holder shall have the right, at such Holder's option, to
require the Company to purchase all or any portion (in integral
multiples of $1,000) of such Holder's Securities on the date
(the "Change of Control Payment Date") which is 20 business
days after the date the Change of Control Notice (as defined
below) is mailed (or such later date as is required by appli-
cable law) at 101% of the principal amount thereof, plus
accrued interest to the Change of Control Payment Date; pro-
vided, that the Company shall not be obligated to purchase any
of such Securities unless Holders of at least 10% of the Secu-
rities outstanding at the Change of Control Payment Date (other
than Securities held by the Company and its Affiliates) shall
have tendered their Securities for repurchase. In addition, in
the event of any Change of Control, the Company will not, and
will not permit any Subsidiaries to, purchase or redeem any
Indebtedness ranking junior to the Securities pursuant to any
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analogous provisions on or prior to the Change of Control Pay-
ment Date.
(b) The Company, or at the request of the Company,
the Trustee, shall send, by first-class mail, postage prepaid,
to all Holders, within five business days after the occurrence
of each Change of Control, a notice of the occurrence of such
Change of Control (the "Change of Control Notice"), specifying
a date by which a Holder must notify the Company of such Hold-
er's intention to exercise the repurchase right and describing
the procedure that such Holder must follow to exercise such
right. The Company is required to deliver a copy of such
notice to the Trustee and to cause a copy of such notice to be
published in a daily newspaper of national circulation.
Each Change of Control Notice shall state:
(1) the Change of Control Payment Date;
(2) the date by which the repurchase right must be
exercised;
(3) the price at which the repurchase is to be made,
if the repurchase right is exercised; and
(4) a description of the procedure which the Holder
must follow to exercise a repurchase right.
No failure of the Company to give the foregoing
notice shall limit any Holder's right to exercise a repurchase
right. The Company shall comply with all applicable Federal
and state securities laws in connection with each Change of
Control Notice.
(c) To exercise the repurchase right, the Holder
shall deliver, on or before the fifth calendar day prior to the
Change of Control Payment Date, written notice (which shall be
irrevocable) to the Company (or an agent designated by the Com-
pany for such purpose) of the Holder's exercise of such right,
together with (i) the Security or Securities with respect to
which the right is being exercised, duly endorsed for transfer,
with the form entitled "Option of Holder to Elect Purchase" on
the reverse of the Security completed, and (ii) if the Change
of Control Payment Date falls between any record date for the
payment of interest on the Securities and the next succeeding
interest payment date, an amount equal to the interest which
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the Holder is entitled to receive on such interest payment
date.
(d) A "Change of Control" shall be deemed to occur
if (i) the Company has any other Indebtedness outstanding
(other than Indebtedness under a bank credit agreement or simi-
lar bank financing) which provides for a Change of Control (as
defined in the instrument governing such Indebtedness) if Ian
M. Cumming or Joseph S. Steinberg ceases to beneficially own,
in the aggregate, a certain percentage of the outstanding Com-
mon Shares, which percentage ownership requirement is in excess
of 10%, and a Change of Control (as defined in the instrument
governing such Indebtedness) occurs under such Indebtedness or
(ii) at any time when the Company does not have any other
Indebtedness outstanding of the type referred to in clause (i),
Ian M. Cumming or Joseph S. Steinberg, individually or in the
aggregate, sells, transfers or otherwise disposes of (a "Dis-
position"), after the date hereof, Common Shares so that, after
giving effect thereto, the sole beneficial ownership of out-
standing Common Shares by Mr. Cumming and/or Mr. Steinberg
would, in the aggregate, fall below 10% of the then outstanding
Common Shares; provided, that no Change of Control shall be
deemed to have occurred under clause (ii) if the Securities are
rated by Moody's or S&P as Investment Grade both at the time of
such Disposition and for a period of 90 days from the date of
such Disposition (it being understood that, with respect to the
foregoing proviso, a Change of Control shall be deemed to occur
on the first date during such 90-day period when the Securities
are rated below Investment Grade by both Moody's and S&P). The
term "Common Shares" shall include any securities issued as
dividends or distributions on the Common Shares. For purposes
hereof, "sole beneficial ownership" of Common Shares shall be
deemed to include (i) all Common Shares received after June 15,
1992 from Mr. Cumming or Mr. Steinberg by any member of their
respective immediate families or by any trust for the benefit
of either of them or any member of their respective immediate
families (a "Recipient"), which Common Shares remain held by a
Recipient during the lifetime of Mr. Cumming or Mr. Steinberg
(unless sold, transferred or disposed of by such Recipient dur-
ing the lifetime of Mr. Cumming or Mr. Steinberg, as the case
may be, in which case such Disposition by such Recipient shall
constitute a Disposition by Mr. Cumming or Mr. Steinberg, as
the case may be) and (ii) after the death of Mr. Cumming and/or
Mr. Steinberg, all Common Shares owned as of the date of death
by the decedent, and any Recipient of the decedent, regardless
of whether such Recipient continues to own such Common Shares
after the date of death. In determining the number of
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outstanding Common Shares then held by Messrs. Cumming and
Steinberg and the total number of outstanding Common Shares,
there shall be excluded Common Shares issued by the Company
after December 31, 1991, or the conversion into or exchange
for, after December 31, 1991, Common Shares or securities con-
vertible into or exchangeable for Common Shares.
SECTION 3.12. Limitation on Incurrence of
Additional Indebtedness by
the Company and on Incur-
rence of Additional Indebted-
ness and Issuance of Preferred
Stock by Its Subsidiaries.
(a) The Company shall not, and shall not permit any
Subsidiary to, create, incur, assume, or guarantee the payment
of any Indebtedness, and shall not permit any of its Subsidiar-
ies to issue any Preferred Stock, if, at the time of such event
and after giving effect thereto on a pro forma basis, the Com-
pany's ratio of Consolidated Debt to Consolidated Tangible Net
Worth, as of the most recent date for which consolidated finan-
cial statements are available and adjusted for the incurrence
of all Indebtedness and the issuance of all Preferred Stock by
Subsidiaries (other than Permitted Indebtedness) since that
date, would be greater than 1.75 to 1.
(b) Paragraph (a) of this Section 3.12 shall not
preclude the incurrence of Permitted Indebtedness.
SECTION 3.13. Limitation on Issuance of
Other Subordinated Debt.
The Company shall not issue, assume, guarantee, incur
or otherwise become liable, directly or indirectly, for any
Indebtedness subordinate or junior in ranking in any respect to
any Senior Indebtedness but senior in right of payment to the
Securities.
SECTION 3.14. Restriction on Investments
by Insurance Subsidiaries.
The Company shall not permit any Subsidiary which is
an insurance company to make, directly or indirectly, any
Investment other than in Investment Grade Securities if, after
giving effect thereto at the time of such Investment, less than
80% of the aggregate Investments of such insurance company
would consist of Investment Grade Securities, valuing
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Investments for purposes of this restriction at original cost.
The foregoing restriction shall not (i) apply to Investments in
the Company or any Subsidiary of the Company, (ii) prevent the
Company or its Subsidiaries from acquiring the Capital Stock
of, or all or substantially all of the assets of, an insurance
company or (iii) apply to securities issued in a restructuring
or exchange offer or similar transaction offered generally to
all holders of another security then held by such Subsidiary.
SECTION 3.15. Limitation on Certain Payments
or Investments.
(a) In the event of any Certain Payment or Invest-
ment, each Holder shall have the right, at such Holder's
option, to require the Company to purchase all or any portion
(in integral multiples of $1,000) of such Holder's Securities
on the date (the "Certain Payment or Investment Payment Date")
which is 20 business days after the date the Certain Payment or
Investment Notice (as defined below) is mailed (or such later
date as is required by applicable law) at 101% of the principal
amount thereof, plus accrued interest to the Certain Payment or
Investment Payment Date; provided, that the Company shall not
be obligated to purchase any of such Securities unless Holders
of at least 10% of the Securities outstanding at the Certain
Payment or Investment Payment Date (other than Securities held
by the Company and its Affiliates) shall have tendered their
Securities for repurchase. In addition, in the event of any
Certain Payment or Investment, the Company will not, and will
not permit any Subsidiaries to, purchase or redeem any Indebt-
edness ranking junior to the Securities pursuant to any analo-
gous provisions on or prior to the Certain Payment or Invest-
ment Payment Date.
(b) The Company, or at the request of the Company,
the Trustee, shall send, by first-class mail, postage prepaid,
to all Holders, within five business days after the occurrence
of each Certain Payment or Investment, a notice of the occur-
rence of such Certain Payment or Investment (the "Certain Pay-
ment or Investment Notice"), specifying a date by which a
Holder must notify the Company of such Holder's intention to
exercise the repurchase right and describing the procedure that
such Holder must follow to exercise such right. The Company is
required to deliver a copy of such notice to the Trustee and to
cause a copy of such notice to be published in a daily news-
paper of national circulation.
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Each Certain Payment or Investment Notice shall
state:
(1) the Certain Payment or Investment Payment Date;
(2) the date by which the repurchase right must be
exercised;
(3) the price at which the repurchase is to be made,
if the repurchase right is exercised; and
(4) a description of the procedure which the Holder
must follow to exercise a repurchase right.
No failure of the Company to give the foregoing
notice shall limit any Holder's right to exercise a repurchase
right. The Company shall comply with all applicable Federal
and state securities laws in connection with each Certain Pay-
ment or Investment Notice.
(c) To exercise the repurchase right, the Holder
shall deliver, on or before the fifth calendar day prior to the
Certain Payment or Investment Payment Date, written notice
(which shall be irrevocable) to the Company (or an agent desig-
nated by the Company for such purpose) of the Holder's exercise
of such right, together with (i) the Security or Securities
with respect to which the right is being exercised, duly
endorsed for transfer, with the form entitled "Option of Holder
to Elect Purchase" on the reverse of the Security completed,
and (ii) if the Certain Payment or Investment Payment Date
falls between any record date for the payment of interest on
the Securities and the next succeeding interest payment date,
an amount equal to the interest which the Holder is entitled to
receive on such interest payment date.
ARTICLE FOUR
SUCCESSOR CORPORATION
SECTION 4.01. When Company May Merge, etc.
The Company shall not consolidate or merge with or
into, or sell, lease, convey or otherwise dispose of all or
substantially all of its assets (it being understood that a
sale of less than 90% of the Company's total assets shall not
be deemed a sale of substantially all of the Company's assets),
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in one transaction or a series of related transactions, to any
Person unless:
(1) the Person formed by or surviving any such con-
solidation or merger (if other than the Company), or to
which such sale, lease, conveyance or other disposition
shall have been made, is a corporation organized and
existing under the laws of the United States, any state
thereof or the District of Columbia;
(2) the corporation formed by or surviving any such
consolidation or merger (if other than the Company), or to
which such sale, lease, conveyance or other disposition
shall have been made, assumes by supplemental indenture in
a form satisfactory to the Trustee all the obligations of
the Company under the Securities and this Indenture;
(3) immediately before and immediately after such
transaction no Default or Event of Default exists;
(4) the Company or any corporation formed by or sur-
viving any such consolidation or merger, or to which such
sale, lease, conveyance or other disposition shall have
been made, would be permitted by the provisions of Section
3.12(a) to incur $1.00 of additional Indebtedness (other
than Permitted Indebtedness); and
(5) the Company or any corporation formed by or sur-
viving any such consolidation or merger, or to which such
sale, lease, conveyance or other disposition shall have
been made, shall immediately thereafter have a Consoli-
dated Net Worth (after purchase accounting adjustments) at
least equal to the Consolidated Net Worth of the Company
immediately preceding such transaction.
The Company shall deliver to the Trustee prior to the
consummation of the proposed transaction an Officers' Certifi-
cate to the foregoing effect and an Opinion of Counsel stating
that the proposed transaction and such supplemental Indenture
comply with this Indenture.
SECTION 4.02. Successor Corporation Substituted.
Upon any consolidation or merger, or any sale, lease,
conveyance or other disposition of all or substantially all of
the assets of the Company in accordance with Section 4.01, the
successor corporation formed by such consolidation or into
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which the Company is merged or to which such sale, lease, con-
veyance or other disposition 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 corporation had been named as the Company herein.
ARTICLE FIVE
DEFAULTS AND REMEDIES
SECTION 5.01. Events of Default.
An "Event of Default" occurs if:
(1) the Company defaults in the payment of interest
on any Security when the same becomes due and payable and
such default continues for a period of 30 days (and
whether or not such payment would be subject to Article
Nine);
(2) the Company defaults in the payment of the prin-
cipal (including premium, if any) of any Security when the
same becomes due and payable at maturity or otherwise (and
whether or not such payment would be subject to Article
Nine);
(3) the Company fails to comply with any of its
other agreements in the Securities or this Indenture and
such default continues for the period and after the notice
specified below;
(4) the Company or any Material Subsidiary either
(A) defaults in the payment when due of principal of,
interest on, or other amounts payable in respect of, or
(B) fails to perform or comply with any of its other
agreements in respect of, any of its respective Indebted-
ness (other than the Securities) in the aggregate princi-
pal or like amount of $15,000,000 or more, and such
Indebtedness shall be or shall have been declared to be
due and payable immediately, and such acceleration shall
not have been rescinded or annulled;
(5) the Company or any Material Subsidiary pursuant
to or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case or proceeding,
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(B) consents to the entry of an order for
relief against it in an involuntary case or
proceeding,
(C) consents to the appointment of a Custodian
of it or for all or substantially all of its prop-
erty, or
(D) makes a general assignment for the benefit
of its creditors, or
(6) a court of competent jurisdiction enters an
order or decree under any Bankruptcy Law that:
(A) is for relief (with respect to the petition
commencing such case) against the Company or any
Material Subsidiary in an involuntary case or
proceeding,
(B) appoints a Custodian of the Company or any
Material Subsidiary or for all or substantially all
of its respective property, or
(C) orders the liquidation of the Company or
any Material Subsidiary,
and the order or decree remains unstayed and in effect for 60
days.
The term "Bankruptcy Law" means Title 11, U.S. Code
or any similar Federal or state law for the relief of debtors.
The term "Custodian" means any receiver, trustee, assignee,
liquidator or similar official under any Bankruptcy Law.
A Default under clause (3) of this Section 5.01 is
not an Event of Default until the Trustee or the Holders of at
least 25% in principal amount of the Securities notify the Com-
pany of the Default and the Company does not cure the Default
within 30 days after receipt of the notice. The notice must
specify the Default, demand that it be remedied and state that
the notice is a "Notice of Default."
SECTION 5.02. Acceleration.
If an Event of Default (other than an Event of
Default with respect to the Company specified in clause (5) or
(6) of Section 5.01) occurs and is continuing, the Trustee by
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notice to the Company, or the Holders of at least 25% in aggre-
gate principal amount of the Securities then outstanding by
notice to the Company and the Trustee, may declare the princi-
pal of, and the accrued interest on, all of the Securities then
outstanding due and payable immediately. Upon such declaration
such principal and interest shall be due and immediately
payable.
If an Event of Default with respect to the Company
specified in clause (5) or (6) of Section 5.01 occurs, all
unpaid principal of and accrued interest on the Securities then
outstanding shall ipso facto become and be immediately due and
payable without any declaration or other act on the part of the
Trustee or any Holder.
Notwithstanding anything to the contrary in the pre-
ceding two paragraphs, the Holders of a majority in principal
amount of the Securities then outstanding by notice to the
Trustee may rescind an acceleration and its consequences if all
existing Events of Default have been cured or waived and if the
rescission would not conflict with any judgment or decree.
When a Default or Event of Default is cured or waived, it
ceases to exist.
SECTION 5.03. Other Remedies.
If an Event of Default occurs and is continuing, the
Trustee may pursue any available remedy by proceeding at law or
in equity to collect the payment of principal or interest on
the Securities or to enforce the performance of any provision
of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does
not possess any of the Securities or does not produce any of
them in the proceeding. A delay or omission by the Trustee or
any Securityholder in exercising any right or remedy accruing
upon an Event of Default shall not impair the right or remedy
or constitute a waiver of or acquiescence in the Event of
Default. No remedy is exclusive of any other remedy. All
available remedies are cumulative.
SECTION 5.04. Waiver of Past Defaults.
Subject to Sections 5.07 and 8.02, the Holders of a
majority in principal amount of the Securities by notice to the
Trustee may waive an existing Default or Event of Default and
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its consequences, except a Default or Event of Default in pay-
ment of principal of, or interest on, any Security.
SECTION 5.05. Control by Majority.
The Holders of a majority in principal amount of the
Securities may direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee or exer-
cising any trust or power conferred on it. However, the Trus-
tee may refuse to follow any direction that conflicts with law
or this Indenture, that is unduly prejudicial to the rights of
another Securityholder, as such, or that would involve the
Trustee in personal liability.
SECTION 5.06. Limitation on Remedies.
Except as provided in Section 5.07, a Securityholder
may not pursue any remedy with respect to this Indenture or the
Securities unless:
(1) the Holder gives to the Trustee written notice
of a continuing Event of Default;
(2) the Holders of at least 25% in principal amount
of the Securities make a written request to the Trustee to
pursue the remedy;
(3) such Holder or Holders offer to the Trustee
indemnity satisfactory to the Trustee against any loss,
liability or expense;
(4) the Trustee does not comply with the request
within 60 days after receipt of the request and the offer
of indemnity; and
(5) no direction inconsistent with the request has
been given to the Trustee during such 60-day period by the
Holders of a majority in principal amount of the
Securities.
A Securityholder may not use this Indenture to preju-
dice the rights of another Securityholder or to obtain a pref-
erence or priority over other Securityholders.
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SECTION 5.07. Rights of Holders To Receive Payment.
Notwithstanding any other provision of this Inden-
ture, the right of any Holder of a Security as set forth in
this Indenture to receive payment of principal of and interest
on the Security, on or after the respective due dates expressed
in the Security, or to bring suit for the enforcement of any
such payment on or after such respective dates, shall not be
impaired or affected without the consent of such Holder.
SECTION 5.08. Collection Suit by Trustee.
If an Event of Default in payment of interest or
principal specified in Section 5.01(1) or (2) occurs and is
continuing, the Trustee may recover judgment in its own name
and as trustee of an express trust against the Company for the
whole amount of principal and interest remaining unpaid and
such further amounts as shall be sufficient to cover the costs
and expenses of collection, including the reasonable compensa-
tion and expenses of the Trustee, its agents and counsel.
SECTION 5.09. Trustee May File Proofs of Claim.
(a) The Trustee may file such proofs of claim and
other papers or documents as may be necessary or advisable in
order to have the claims of the Trustee and the Securityholders
allowed in any judicial proceedings relative to the Company,
its creditors or its property.
(b) Nothing herein contained shall be deemed to
authorize the Trustee to authorize or consent to or accept or
adopt on behalf of any Securityholder any plan of reorganiza-
tion, 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 Security-
holder in any such proceeding.
SECTION 5.10. Priorities.
If the Trustee collects any money pursuant to this
Article Five, it shall pay out the money in the following
order:
First: to the Trustee for amounts due under Section
6.07;
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Second: to Holders of Senior Indebtedness to the
extent required by Article Nine;
Third: to Securityholders for amounts due and unpaid
on the Securities for principal and interest, ratably,
without preference or priority of any kind, according to
the amounts due and payable on the Securities for princi-
pal and interest, respectively; and
Fourth: To the Company.
The Trustee may fix a record date and payment date
for any payment to Securityholders pursuant to this Section
5.10.
SECTION 5.11. Undertaking for Costs.
In any suit for the enforcement of any right or rem-
edy under this Indenture or in any suit against the Trustee for
any action taken or omitted by it as Trustee, a court in its
discretion may require the filing by any party litigant in the
suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in the
suit, having due regard to the merits and good faith of the
claims or defenses made by the party litigant. This Section
5.11 does not apply to a suit by the Trustee, a suit by a
Holder pursuant to Section 5.07, or a suit by Holders of more
than 10% in principal amount of the then outstanding
Securities.
ARTICLE SIX
TRUSTEE
SECTION 6.01. Duties of Trustee.
(a) If an Event of Default has occurred and is con-
tinuing, the Trustee shall exercise its rights and powers and
use the same degree of care and skill in their exercise as a
prudent person would exercise or use under the circumstances in
the conduct of his own affairs.
(b) Except during the continuance of an Event of
Default:
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(1) The Trustee need perform only those duties that
are specifically set forth (or incorporated by reference)
in this Indenture and no others.
(2) In the absence of bad faith on its part, the
Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this Inden-
ture. However, the Trustee shall examine such certifi-
cates and opinions to determine whether or not they con-
form to the requirements of this Indenture.
(c) The Trustee may not be relieved from liability
for its own negligent action, its own negligent failure to act,
or its own willful misconduct, except that:
(1) This paragraph (c) does not limit the effect of
paragraph (b) of this Section.
(2) The Trustee shall not be liable for any error of
judgment made in good faith by a Trust Officer, unless it
is proved that the Trustee was negligent in ascertaining
the pertinent facts.
(3) The Trustee shall not be liable with respect to
action it takes or omits to take in good faith in accor-
dance with a direction received by it pursuant to Section
5.05, and the Trustee shall be entitled from time to time
to request such a direction.
(d) Every provision of this Indenture that in any
way relates to the Trustee is subject to paragraphs (a), (b)
and (c) of this Section.
(e) The Trustee shall be under no obligation and may
refuse to perform any duty or exercise any right or power
unless it receives indemnity satisfactory to it against any
loss, liability or expense.
(f) The Trustee shall not be liable for interest on
any money received by it except as the Trustee may agree in
writing with the Company. Money held in trust by the Trustee
need not be segregated from other funds except to the extent
required by law.
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SECTION 6.02. Rights of Trustee.
Subject to Section 6.01:
(a) The Trustee may rely on any document believed by
it to be genuine and to have been signed or presented by
the proper person. The Trustee may rely on and shall be
protected in acting or refraining from acting upon any
document believed by it to be genuine and to have been
signed or presented by the proper person. 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 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 attor-
ney, to the extent reasonably required by such inquiry or
investigation.
(b) Before the Trustee acts or refrains from acting,
it may require an Officers' Certificate or an Opinion of
Counsel. The Trustee shall not be liable for any action
it takes or omits to take in good faith in reliance on
such certificate or opinion.
(c) The Trustee may act through agents and shall not
be responsible for the misconduct or negligence of any
agent appointed with due care.
(d) The Trustee shall not be liable for any action
it takes or omits to take in good faith which it believes
to be authorized or within its rights or powers.
SECTION 6.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity
may become the owner or pledgee of Securities and may otherwise
deal with the Company or its Subsidiaries or Affiliates with
the same rights it would have if it were not Trustee. Any
Agent may do the same with like rights. However, the Trustee
must comply with Sections 6.10 and 6.11.
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SECTION 6.04. Trustee's Disclaimer.
The Trustee makes no representation as to the valid-
ity or adequacy of this Indenture or the Securities, it shall
not be accountable for the Company's use of the proceeds from
the Securities, and it shall not be responsible for any state-
ment in the Securities other than its certificate of
authentication.
SECTION 6.05. Notice of Defaults.
If a Default occurs and is continuing and if it is
known to the Trustee, the Trustee shall mail to each Security-
holder pursuant to Section 10.02 a notice of the Default within
90 days after it occurs. Except in the case of a Default in
any payment on any Security, the Trustee may withhold the
notice if and so long as a committee of its Trust Officers in
good faith determines that withholding the notice is in the
interests of Securityholders.
SECTION 6.06. Reports by Trustee to Holders.
Within 60 days after each May 15, beginning with
May 15, 1996, the Trustee shall mail to each Securityholder a
brief report dated as of such May 15 that complies with TIA
Section 313(a), but only if such report is required in any year under
TIA Section 313(a). The Trustee also shall comply with TIA Sections 313(b)
and 313(c).
A copy of each report at the time of its mailing to
Securityholders shall be filed with the SEC and each stock
exchange on which the Securities are listed. The Company shall
notify the Trustee in writing if the Securities become listed
on any national securities exchange or of any delisting
thereof.
SECTION 6.07. Compensation and Indemnity.
The Company shall pay the Trustee from time to time
reasonable compensation for its services (which compensation
shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust). The Company
shall reimburse the Trustee upon request for all reasonable
out-of-pocket expenses, disbursements and advances incurred by
it. Such expenses may include the reasonable compensation and
expenses of the Trustee's agents and counsel.
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The Trustee shall not be under any obligation to
institute any suit, or take any remedial action under this
Indenture, or to enter any appearance or in any way defend any
suit in which it may be a defendant, or to take any steps in
the execution of the trusts created hereby or thereby or in the
enforcement of any rights and powers under this Indenture,
until it shall be indemnified to its satisfaction against any
and all reasonable expenses, disbursements and advances
incurred or made by the Trustee in accordance with any provi-
sion of this Indenture, including compensation for services,
costs, expenses, outlays, counsel fees and other disbursements,
and against all liability not due to its negligence or willful
misconduct. The Company shall indemnify the Trustee against
any loss or liability incurred by it in connection with the
acceptance and administration of the trust and its duties here-
under as Trustee, Registrar and/or Paying Agent, 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 Trustee shall notify
the Company promptly of any claim for which it may seek indem-
nity; however, unless the position of the Company is prejudiced
by such failure, the failure of the Trustee to promptly notify
the Company shall not limit its right to indemnification. The
Company shall defend each such claim and the Trustee shall
cooperate in the defense. The Trustee may retain separate
counsel and the Company shall reimburse the Trustee for the
reasonable fees and expenses of such counsel. The Company need
not pay for any settlement made without its consent.
The Company need not reimburse any expense or indem-
nify against any loss or liability incurred by the Trustee
through negligence or willful misconduct.
To secure the Company's payment obligations in this
Section, the Trustee shall have a lien prior to that of the
Holders of the Securities on all money or property held or col-
lected by the Trustee, except that held in trust to pay princi-
pal and interest on particular Securities.
When the Trustee incurs expenses or renders services
after the occurrence of any Event of Default specified in Sec-
tions 5.01(5) or (6), the expenses and the compensation for the
services are intended to constitute expenses of administration
under any Bankruptcy law.
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SECTION 6.08. Replacement of Trustee.
The Trustee may resign by so notifying the Company.
The Holders of a majority in principal amount of the Securities
may remove the Trustee by so notifying the Trustee in writing.
The Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 6.10;
(2) the Trustee is adjudged a bankrupt or an
insolvent;
(3) a receiver or other public officer takes charge
of the Trustee or its property; or
(4) the Trustee becomes incapable of acting as Trus-
tee hereunder.
If the Trustee resigns or is removed or if a vacancy
exists in the office of Trustee for any reason, the Company
shall promptly appoint a successor Trustee. Within one year
after the successor Trustee takes office, the Holders of a
majority in principal amount of the Securities may appoint a
successor Trustee to replace the successor Trustee appointed by
the Company.
A successor Trustee shall deliver a written accep-
tance of its appointment to the retiring Trustee and to the
Company. Immediately after that, the retiring Trustee shall
transfer all property held by it as Trustee to the successor
Trustee, subject to the lien provided for in Section 6.07, the
resignation or removal of the retiring Trustee shall become
effective, and the successor Trustee shall have all the rights,
powers and duties of the Trustee under this Indenture. A suc-
cessor Trustee shall mail notice of its succession to each
Securityholder.
If a successor Trustee does not take office within 60
days after the retiring Trustee resigns or is removed, the
retiring Trustee, the Company or the Holders of a majority in
principal amount of the Securities may petition any court of
competent jurisdiction for the appointment of a successor
Trustee.
If the Trustee fails to comply with Section 6.10, any
Securityholder may petition any court of competent jurisdiction
for the removal of the Trustee and the appointment of a
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successor Trustee. Any successor Trustee shall comply with TIA
Section 310(a)(5).
SECTION 6.09. Successor Trustee by Merger, etc.
If the Trustee consolidates, merges or converts into,
or transfers all or substantially all of its corporate trust
assets to, another corporation, the successor corporation with-
out any further act shall be the successor Trustee; provided
such corporation or association shall be otherwise eligible and
qualified under this Article.
SECTION 6.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee who satis-
fies the requirements of TIA Section 310(a)(1). The Trustee shall
always have a combined capital and surplus of at least
$50,000,000 as set forth in its most recent published annual
report of condition. The Trustee shall also comply with TIA
Section 310(b).
SECTION 6.11. Preferential Collection of
Claims Against Company.
The Trustee shall comply with TIA Section 311(a), excluding
any creditor relationship listed in TIA Section 311(b). A Trustee
who has resigned or been removed shall be subject to
TIA Section 311(a) to the extent indicated therein.
ARTICLE SEVEN
DISCHARGE OF INDENTURE
SECTION 7.01. Termination of Company's Obligations.
The Company may terminate all of its obligations
under the Securities and this Indenture if:
(a) all Securities previously authenticated and
delivered (other than destroyed, lost or stolen Securities
which have been replaced or paid) have been delivered to
the Trustee for cancellation and the Company has been paid
all sums payable by it hereunder; or
(b) (1) the Securities mature within one year, and
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(2) the Company irrevocably deposits in trust
with the Trustee immediately available funds or U.S.
Government Obligations sufficient to pay principal and
interest on the Securities to maturity.
However, the Company's obligations in Sections 2.03, 2.04,
2.05, 2.06, 2.07, 6.07 and 6.08 shall survive until the Securi-
ties are no longer outstanding. Thereafter the Company's obli-
gations in Section 6.07 shall survive.
Upon receipt, in the case of (a) or (b) above in this
Section 7.01, by the Trustee of 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, the Trustee upon
request shall acknowledge in writing the discharge of the Com-
pany's obligations under the Securities and this Indenture
except for those surviving obligations specified above.
In order to have money available on a payment date to
pay principal or interest on the Securities, the U.S. Govern-
ment Obligations shall be payable as to principal or interest
on or before such payment date in such amounts as will provide
the necessary money. U.S. Government Obligations shall not be
callable at the issuer's option.
The term "U.S. Government Obligations" means direct
obligations of the United States for the payment of which the
full faith and credit of the United States is pledged.
SECTION 7.02. Application of Trust Money.
The Trustee shall hold in trust money or U.S. Govern-
ment Obligations deposited with it pursuant to Section 7.01.
It shall apply the deposited money and the money from U.S.
Government Obligations through the Paying Agent and in accor-
dance with this Indenture to the payment of principal and
interest on the Securities. Money and securities so held in
trust are not subject to the subordination provisions of
Article Nine and need not be segregated from other funds except
to the extent required by law.
SECTION 7.03. Repayment to Company.
The Trustee and the Paying Agent shall promptly pay
to the Company upon request any excess money or securities held
by them at any time. The Trustee and the Paying Agent shall
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pay to the Company upon request any money held by them for the
payment of principal or interest that remains unclaimed for two
years; 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 news-
paper of general circulation in The City of New York or mail to
each such Holder notice that such money remains unclaimed and
that, after a date specified therein, which shall not be less
than 30 days from the date of such publication or mailing any
unclaimed balance of such money then remaining will be paid to
the Company.
SECTION 7.04. Reinstatement.
If the Trustee or Paying Agent is unable to apply any
money or U.S. Government Obligations in accordance with Section
7.01 by reason of any legal proceeding or by reason of any
order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such applica-
tion, the Company's obligations under this Indenture and the
Securities shall be revived and reinstated as though no deposit
had occurred pursuant to Section 7.01 until such time as the
Trustee or Paying Agent is permitted to apply all such money or
U.S. Government Obligations in accordance with Section 7.01;
provided, however, that if the Company has made any payment of
interest on or principal of any Securities because of the rein-
statement of its obligations, the Company shall be subrogated
to the rights of the Holders of such Securities to receive such
payment from the money or U.S. Government Obligations held by
the Trustee or Paying Agent.
ARTICLE EIGHT
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 8.01. Without Consent of Holders.
The Company may amend or supplement this Indenture or
the Securities without notice to or consent of any
Securityholder:
(1) to cure any ambiguity, defect or inconsistency;
(2) to comply with Section 4.01;
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(3) to provide for uncertificated Securities in
addition to certificated Securities;
(4) to comply with any requirements of the SEC in
order to effect or maintain the qualification of this
Identure under the TIA; or
(5) to make any change that would provide any addi-
tional benefit or rights to the Securityholders or that
does not adversely affect the rights of any
Securityholder.
Notwithstanding the above, the Trustee and the Com-
pany may not make any change that adversely affects the legal
rights of any Securityholders hereunder.
SECTION 8.02. With Consent of Holders.
Subject to Section 5.07, the Company, when authorized
by a resolution of its Board of Directors, may amend or supple-
ment this Indenture or the Securities with the written consent
of the Holders of at least a majority in principal amount of
the Securities then outstanding, and the Holders of a majority
in principal amount of the Securities may waive compliance by
the Company with any provision of this Indenture or the Securi-
ties. However, without the consent of each Securityholder
affected, an amendment, supplement or waiver, including a
waiver pursuant to Section 5.04, may not:
(1) reduce the amount of Securities whose Holders
must consent to an amendment, supplement or waiver;
(2) reduce the rate of or change or extend the time
for payment of principal of or interest on any Security;
(3) reduce the principal of or change the fixed
maturity of any Security;
(4) waive a default in the payment of the principal
of or interest on any Security;
(5) make any Security payable in money other than
that stated in the Security;
(6) make any change in the subordination of the
Securities in a manner that is adverse to the Holders; or
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(7) make any change in this Section, Section 5.04 or
Section 5.07.
Notwithstanding the above and Section 5.07, the Hold-
ers of a majority in principal amount of the Securities then
outstanding may waive compliance by the Company with Sections
3.10 and 3.11 of this Indenture.
It shall not be necessary for the consent of the
Holders under this Section 8.02 to approve the particular form
of any proposed amendment, supplement or waiver, but it shall
be sufficient if such consent approves the substance thereof.
Any amendment, waiver or consent shall be deemed effective upon
receipt by the Trustee of the necessary consents and shall not
require execution of any supplemental indenture to be
effective.
After an amendment or waiver under this Section 8.02
becomes effective, the Company shall mail to the Holders of
each Security affected thereby, with a copy to the Trustee, a
notice briefly describing the amendment or waiver. Any failure
of the Company to mail such notice, or any defect therein,
shall not, however, in any way impair or affect the validity of
any such amendment, waiver, consent or supplemental indenture.
Except as otherwise provided in this Section 8.02, the Holders
of a majority in aggregate principal amount of the Securities
then outstanding may waive compliance in a particular instance
by the Company with any provisions of this Indenture or the
Securities.
SECTION 8.03. Compliance with Trust Indenture Act.
Every amendment to or supplement of this Indenture or
the Securities shall comply with the TIA as then in effect.
SECTION 8.04. Revocation and Effect of Consents.
A consent to an amendment, supplement or waiver by a
Holder of a Security shall bind the Holder and every subsequent
Holder of a Security or portion of a Security that evidences
the same debt as the consenting Holder's Security, even if
notation of the consent is not made on any Security. However,
until an amendment or waiver becomes effective, any such Holder
or subsequent Holder may revoke the consent as to his Security
or portion of a Security. For such revocation to be effective,
the Trustee must receive the notice of revocation before the
date the amendment, supplement or waiver becomes effective.
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After an amendment, supplement or waiver becomes
effective, it shall bind every Securityholder unless it makes a
change described in any of clauses (1) through (7) of Section
8.02. In that case the amendment, supplement or waiver shall
bind each Holder of a Security who has consented to it and
every subsequent Holder of a Security or portion of a Security
that evidences the same debt as the consenting Holder's
Security.
SECTION 8.05. Notation on or Exchange of Securities.
If an amendment, supplement or waiver changes the
terms of a Security, the Trustee may require the Holder of the
Security to deliver it to the Trustee. The Trustee may place
an appropriate notation on the Security about the changed terms
and return it to the Holder. Alternatively, if the Company or
the Trustee so determines, the Company in exchange for the
Security shall issue and the Trustee shall authenticate a new
Security that reflects the changed terms.
SECTION 8.06. Trustee Protected.
The Trustee shall sign any amendment or supplement or
waiver authorized pursuant to this Article if the amendment or
supplement or waiver does not adversely affect the rights of
the Trustee. If it does adversely affect the rights of the
Trustee, the Trustee may but need not sign it. In signing such
amendment or supplement or waiver the Trustee shall be entitled
to receive, and (subject to Article Six) shall be fully pro-
tected in relying upon, an Opinion of Counsel stating that such
amendment or supplement or waiver is authorized or permitted by
and complies with this Indenture. The Company may not sign an
amendment or supplement until the Board of Directors approves
it.
ARTICLE NINE
SUBORDINATION
SECTION 9.01. Securities Subordinated to Senior Indebtedness.
The Company agrees, and each Holder of the Securities
by its acceptance thereof likewise agrees, that the payment of
all Obligations with respect to the Securities is subordinated,
to the extent and in the manner provided in this Article, to
the prior payment in full of all Senior Indebtedness.
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This Article Nine shall constitute a continuing offer
to all persons who, in reliance upon such provisions, become
holders of, or continue to hold, Senior Indebtedness, and such
provisions are made for the benefit of the holders of Senior
Indebtedness, and such holders and/or each of them may enforce
such provisions. No amendment of any provision of this Article
Nine shall be effective as against any holder of Senior Indebt-
edness who has not consented thereto.
SECTION 9.02. Company Not To Make Payments with Respect
to Securities in Certain Circumstances.
(a) Upon the maturity of the principal of any Senior
Indebtedness by lapse of time, acceleration or otherwise, all
Obligations thereon shall first be paid in full, or such pay-
ment duly provided for in cash or in a manner satisfactory to
the holders of such Senior Indebtedness, before any payment is
made on account of any Obligations with respect to the Securi-
ties or to acquire any of the Securities.
(b) Upon the happening of an event of default (or if
any event of default would result upon any payment with respect
to the Securities) with respect to any Senior Indebtedness, as
such event of default is defined therein or in the instrument
under which it is outstanding, permitting the holders to accel-
erate the maturity thereof, and, if the default is other than
default in payment of the principal or interest on such Senior
Indebtedness (a "non-payment default"), upon written notice
thereof given to the Company and the Trustee by the holders of
such Senior Indebtedness or their representative, then, unless
and until such event of default shall have been cured or waived
or shall have ceased to exist, no payment shall be made by the
Company of any Obligations with respect to the Securities or to
acquire any of the Securities; provided, however, that in the
event of a non-payment default, such payment blockage shall not
exceed a period of 179 days commencing on the date of receipt
by the Company of written notice of such non-payment default or
event of default by a holder of such Senior Indebtedness or by
their representatives; provided, that during any 360-day period
the aggregate of all payment blockage periods pursuant hereto
shall not exceed 179 days and there shall be a period of at
least 181 consecutive days in each 360-day period when no pay-
ment blockage period pursuant hereto is in effect.
(c) In the event that, notwithstanding the provi-
sions of this Section 9.02, the Company shall make any payment
to the Trustee or the Holders on account of any Obligations
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with respect to the Securities, after the happening of a
default in payment of the principal on Senior Indebtedness or
an event of default in respect of the payment of interest on
Senior Indebtedness or after receipt by the Company and the
Trustee of written notice as provided in this Section 9.02 of
an event of default with respect to any Senior Indebtedness,
then, unless and until such default or event of default shall
have been cured or waived or shall have ceased to exist, such
payment (subject to the provisions of Sections 9.06 and 9.07)
shall be held by the Trustee or Holders, as the case may be, in
trust for the benefit of, and shall be paid over and delivered
to, the holders of Senior Indebtedness (pro rata as to each of
such holders on the basis of the respective amounts of Senior
Indebtedness held by them) or their representative or the trus-
tee under the indenture or other agreement (if any) pursuant to
which Senior Indebtedness may have been issued, as their
respective interests may appear, for application to the payment
of all Senior Indebtedness remaining unpaid to the extent nec-
essary to pay all Senior Indebtedness in full in accordance
with its terms, after giving effect to any concurrent payment
or distribution or provision therefor to the holders of Senior
Indebtedness. The Company shall give prompt written notice to
the Trustee of any default under any Senior Indebtedness or
under any agreement pursuant to which Senior Indebtedness may
have been issued.
SECTION 9.03. Securities Subordinated to Prior Payment of
All Senior Indebtedness on Dissolution,
Liquidation or Reorganization of Company.
Upon any distribution of assets of the Company upon
any dissolution, winding up, liquidation or reorganization of
the Company (whether in bankruptcy, insolvency or receivership
proceedings or upon an assignment for the benefit of creditors
or otherwise) tending towards liquidation of the business and
assets of the Company:
(a) the holders of all Senior Indebtedness shall
first be entitled to receive payment in full of all Obli-
gations due thereon (including without limitation interest
accruing after the commencement of any such proceeding at
the rate specified in the respective Senior Indebtedness)
before the Holders of the Securities are entitled to
receive any payment on account of any Obligations with
respect to the Securities;
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(b) any payment or distribution of assets of the
Company of any kind or character, whether in cash, prop-
erty or securities, to which the Holders of the Securities
or the Trustee on behalf of the Holders of the Securities
would be entitled except for the provisions of this
Article Nine, shall be paid by the liquidating trustee or
agent or other person making such payment or distribution
directly to the holders of Senior Indebtedness or their
representative, or to the trustee under any indenture
under which Senior Indebtedness may have been issued, to
the extent necessary to make payment in full of all Senior
Indebtedness remaining unpaid, after giving effect to any
concurrent payment or distribution or provision therefor
to the holders of such Senior Indebtedness; and
(c) in the event that notwithstanding the foregoing
provisions of this Section 9.03, any payment or distribu-
tion of assets of the Company of any kind or character,
whether in cash, property or securities, shall be received
by the Trustee or the Holders of the Securities on account
of any Obligations with respect to the Securities before
all Senior Indebtedness is paid in full, or effective pro-
vision made for its payment, such payment or distribution
(subject to the provisions of Section 9.06 and 9.07) shall
be received and held in trust for and shall be paid over
to the holders of the Senior Indebtedness remaining unpaid
or unprovided for or their representative, or to the trus-
tee under any indenture under which Senior Indebtedness
may have been issued, for application to the payment of
such Senior Indebtedness until all such Senior Indebted-
ness shall have been paid in full, after giving effect to
any concurrent payment or distribution or provision there-
for to the holders of such Senior Indebtedness.
The Company shall give prompt written notice to the
Trustee of any dissolution, winding up, liquidation or reorga-
nization of the Company.
SECTION 9.04. Securityholders To Be Subrogated to
Rights of Holders of Senior Indebtedness.
Subject to the payment in full of all Senior Indebt-
edness, the Holders of the Securities shall be subrogated to
the rights of the holders of Senior Indebtedness to receive
payments or distributions of assets of the Company applicable
to the Senior Indebtedness until all amounts owing on the Secu-
rities shall be paid in full, and for the purpose of such
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subrogation no payments or distributions to the holders of the
Senior Indebtedness by or on behalf of the Company or by or on
behalf of the Holders of the Securities by virtue of this
Article which otherwise would have been made to the Holders of
the Securities shall, as between the Company and the Holders of
the Securities, be deemed to be payment by the Company to or on
account of the Senior Indebtedness, it being understood that
the provisions of this Article Nine are and are intended solely
for the purpose of defining the relative rights of the Holders
of the Securities, on the one hand, and the holders of the
Senior Indebtedness, on the other hand.
SECTION 9.05. Obligation of the Company Unconditional.
Nothing contained in this Article Nine or elsewhere
in this Indenture or in any Security is intended to or shall
impair, as between the Company and the Holders of the Securi-
ties, the obligation of the Company, which is absolute and
unconditional, to pay to the Holders of the Securities the
principal and interest on the Securities as and when the same
shall become due and payable in accordance with their terms, or
is intended to or shall affect the relative rights of the Hold-
ers of the Securities and creditors of the Company other than
the holders of the Senior Indebtedness, nor shall anything
herein or therein prevent the Trustee or the Holder of any
Security from exercising all remedies otherwise permitted by
applicable law upon Default under this Indenture, subject to
the rights, if any, under this Article Nine of the holders of
Senior Indebtedness in respect of cash, property or securities
of the Company received upon the exercise of any such remedy.
Upon any distribution of assets of the Company referred to in
this Article Nine, the Trustee, subject to the provisions of
Sections 6.01 and 6.02, and the Holders of the Securities shall
be entitled to rely upon any order or decree made by any court
of competent jurisdiction in which such dissolution, winding
up, liquidation or reorganization proceedings are pending, or a
certificate of the liquidating trustee or agent or other person
making any distribution to the Trustee or to the Holders of the
Securities, for the purpose of ascertaining the persons enti-
tled to participate in such distribution, the holders of the
Senior Indebtedness and other indebtedness of the Company, the
amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or
to this Article Nine.
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SECTION 9.06. Trustee Entitled To Assume Payments
Not Prohibited in Absence of Notice.
The Trustee shall not at any time be charged with
knowledge of the existence of any facts which would prohibit
the making of any payment to or by the Trustee, unless it shall
have received at its corporate trust department written notice
thereof from the Company or from one or more holders of Senior
Indebtedness or from any trustee thereof; and, prior to the
receipt of any such written notice, the Trustee, subject to the
provisions of Article Six, shall be entitled to assume conclu-
sively that no such facts exist. The Trustee shall be entitled
to rely on the delivery to it of a written notice by a person
representing himself to be a holder of Senior Indebtedness (or
a trustee on behalf of such holder) to establish that such
notice has been given by a holder of Senior Indebtedness or a
trustee on behalf of any such holder or holders.
SECTION 9.07. Application by Trustee of Monies
Deposited with It.
Except as provided in Section 7.02, any deposit of
monies by the Company with the Trustee or any Paying Agent
(whether or not in trust) for the payment of the principal of
interest on any Securities shall be subject to the provisions
of Sections 9.01, 9.02, 9.03 and 9.04 except that, if prior to
the third business day prior to the date on which by the terms
of this Indenture any such monies may become payable for any
purpose (including, without limitation, the payment of either
the principal or the interest on any Security) the Trustee or,
in the case of any such deposit of monies with a Paying Agent,
the Paying Agent shall not have received with respect to such
monies the notice provided for in Section 9.06, then the Trus-
tee or such Paying Agent, as the case may be, shall have full
power and authority to receive such monies and to apply the
same to the purpose for which they were received, and shall not
be affected by any notice to the contrary which may be received
by it on or after such third business day. In the event that
the Trustee determines in good faith that further evidence is
required with respect to the right of any person as a holder of
Senior Indebtedness to participate in any payment or distribu-
tion pursuant to this Article Nine, the Trustee may request
such person to furnish evidence to the reasonable satisfaction
of the Trustee as to the amount of Senior Indebtedness held by
such person, the extent to which such person is entitled to
participate in such payment or distribution and any other facts
pertinent to the rights of such person under this Article Nine,
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and if such evidence is not furnished the Trustee may defer any
payment to such person pending judicial determination as to the
right of such person to receive such payment.
The Trustee, however, shall not be deemed to owe any
fiduciary duty to the holders of Senior Indebtedness but shall
have only such obligations to such holders as are expressly set
forth in this Article Nine.
SECTION 9.08. Subordination Rights Not Impaired
by Acts or Omissions of Company or
Holders of Senior Indebtedness.
No right of any present or future holders of any
Senior Indebtedness to enforce subordination as provided herein
shall at any time in any way be prejudiced or impaired by any
act or failure to act on the part of the Company or by any act
or failure to act, in good faith, by any such holder, or by any
noncompliance by the Company with the terms of this Indenture,
regardless of any knowledge thereof which any such holder may
have or be otherwise charged with.
SECTION 9.09. Securityholders Authorize Trustee To
Effectuate Subordination of Securities.
Each Holder of the Securities by his acceptance
thereof authorizes and expressly directs the Trustee on his
behalf to take such action as may be necessary or appropriate
to effectuate the subordination provided in this Article Nine
and appoints the Trustee his attorney-in-fact for such purpose,
including, in the event of any dissolution, winding up, liqui-
dation or reorganization of the Company (whether in bankruptcy,
insolvency or receivership proceedings or upon an assignment
for the benefit of creditors or otherwise) tending towards
liquidation of the business and assets of the Company, the
immediate filing of a claim for the unpaid balance of its or
his Securities in the form required in said proceedings and the
causing of said claim to be approved. If the Trustee does not
file a proper claim or proof of debt in the form required in
such proceeding prior to 30 days before the expiration of the
time to file such claims, then the holders of Senior Indebted-
ness are hereby authorized to have the right to file and are
hereby authorized to file an appropriate claim for and on
behalf of the Holders of said Securities.
<PAGE>
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SECTION 9.10. Right of Trustee To Hold Senior Indebtedness.
The Trustee shall be entitled to all of the rights
set forth in this Article Nine in respect of any Senior Indebt-
edness at any time held by it to the same extent as any other
holder of Senior Indebtedness, and nothing in this Indenture
shall be construed to deprive the Trustee of any of its rights
as such holder.
SECTION 9.11. Article Nine Not To Prevent Events of Default.
The failure to make a payment on account of principal
or interest by reason of any provision in this Article Nine
shall not be construed as preventing the occurrence of an Event
of Default under Section 5.01.
SECTION 9.12. Ranking; Designation.
The Securities rank senior in right of payment to the
5 1/4% Debentures and the Swiss Franc Bonds and pari passu in
right of payment to the 10 3/8% Notes. The Indebtedness evi-
denced by the Securities is hereby irrevocably designated as
(i) "Senior Indebtedness" for purposes of the Indenture dated
as of February 1, 1993 between the Company and First Trust
National Association, as trustee, pursuant to which the 5 1/4%
Debentures were issued and (ii) "Senior Debt" for purposes of
the Public Bond Issue Agreement dated February 25, 1986 among
the Company and Manufacturers Hanover (Suisse) S.A., Soditic
S.A. and Banque Paribas (Suisse) S.A., together heading and
representing a consortium composed of the institutions named
therein, pursuant to which the Swiss Franc Bonds were issued.
ARTICLE TEN
MISCELLANEOUS
SECTION 10.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies,
or conflicts with another provision which is required to be
included in this Indenture by the TIA, the required provision
shall control.
<PAGE>
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SECTION 10.02. Notices.
Any notice or communication shall be sufficiently
given if in writing and delivered in person or mailed by certi-
fied or registered mail (return receipt requested) addressed as
follows:
If to the Company:
Leucadia National Corporation
315 Park Avenue South
New York, New York 10010
Attention: Secretary
With a copy to:
Weil Gotshal & Manges
767 Fifth Avenue
New York, New York 10153
Attention: Stephen E. Jacobs, Esq.
If to the Trustee:
The First National Bank of Boston
Attention: Corporate Trust Department
The Company or the Trustee by notice to the other may
designate additional or different addresses for subsequent
notices or communications.
Any notice or communication mailed to a Security-
holder shall be mailed to him by first-class mail at his
address as it appears on the registration books of the Regis-
trar and shall be sufficiently given to him if so mailed within
the time prescribed.
Failure to mail a notice or communication to a
Securityholder or any defect in it shall not affect its suffic-
iency with respect to other Securityholders. If a notice or
communication is mailed in the manner provided above, it is
duly given, whether or not the addressee receives it. If the
Company mails notices or communications to Securityholders it
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shall mail a copy to the Trustee and each Agent at the same
time. All notices or communications shall be in writing.
SECTION 10.03. Communication by Holders with Other Holders.
Securityholders may communicate pursuant to TIA
Section 312(b) with other Securityholders with respect to their
rights under this Indenture or the Securities. The Company,
the Trustee, the Registrar and anyone else shall have the pro-
tection of TIA Section 312(c).
SECTION 10.04. Certificate and Opinion as
to Conditions Precedent.
Upon any request or application by the Company to the
Trustee to take any action under this Indenture, the Company
shall furnish to the Trustee:
(1) an Officers' Certificate stating that, in the
opinion of the signers, all conditions precedent, if any,
provided for in this Indenture relating to the proposed
action have been complied with; and
(2) an Opinion of Counsel stating that, in the opin-
ion of such counsel, all such conditions precedent have
been complied with.
SECTION 10.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to com-
pliance with a condition or covenant provided for in this
Indenture shall include:
(1) a statement that each person making such cer-
tificate or opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of
the examination or investigation upon which the statements
or opinions contained in such certificate or opinion are
based;
(3) a statement that, in the opinion of each such
person, he has made such examination or investigation as
is necessary to enable him to express an informed opinion
as to whether or not such covenant or condition has been
complied with; and
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(4) a statement as to whether or not, in the opinion
of each such person, such covenant or condition has been
complied with.
SECTION 10.06. When Treasury Securities Disregarded.
In determining whether the Holders of the required
principal amount of Securities have concurred in any direction,
waiver or consent, Securities owned by the Company or by any
Affiliate shall be disregarded, except that for the purpose of
determining whether the Trustee shall be protected in relying
on any such direction, waiver or consent, only Securities which
the Trustee knows are so owned shall be so disregarded.
SECTION 10.07. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by
or a meeting of Securityholders. The Registrar or Paying Agent
may make reasonable rules for its functions.
SECTION 10.08. Legal Holidays.
A "Legal Holiday" is a Saturday, a Sunday, or a day
on which banks and trust companies in The City of New York,
Boston or Hartford are not required by law or executive order
to be open. If a payment date is a Legal Holiday at a place of
payment, payment may be made at the place on the next succeed-
ing day that is not a Legal Holiday, without additional
interest.
SECTION 10.09. Governing Law.
The laws of the State of New York shall govern this
Indenture and the Securities without regard to principles of
conflicts of laws.
SECTION 10.10. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another
indenture, loan or debt agreement of the Company or a Subsid-
iary. Any such indenture, loan or debt agreement may not be
used to interpret this Indenture.
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SECTION 10.11. No Recourse Against Others.
All liability described in paragraph 17 of the Secu-
rities of any director, officer, employee or stockholder, as
such, of the Company is waived and released.
SECTION 10.12. Successors.
All agreements of the Company in this Indenture and
the Securities shall bind its successor. All agreements of the
Trustee in this Indenture shall bind its successor.
SECTION 10.13. Duplicate Originals.
The parties may sign any number of copies of this
Indenture. Each signed copy shall be an original, but all of
them together represent the same instrument.
SECTION 10.14. Separability.
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 provi-
sions shall not in any way be affected or impaired thereby, and
a Holder shall have no claim therefor against any party hereto.
<PAGE>
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SIGNATURES
LEUCADIA NATIONAL CORPORATION
By
----------------------------------
Name:
Title:
(Seal)
Attest:
--------------------------
Name:
Title:
THE FIRST NATIONAL BANK OF
BOSTON, Trustee
By
----------------------------------
Name:
Title:
(Seal)
Attest:
--------------------------
Name:
Title:
<PAGE>
<PAGE>
EXHIBIT A
[Form of Security]
% SENIOR SUBORDINATED NOTE DUE , 2005
No. $
LEUCADIA NATIONAL CORPORATION
(a New York corporation)
promises to pay to
--------------------
or registered assigns
the principal sum of Dollars on , 2005.
Interest Payment Dates: and
Record Dates: and
Dated:
LEUCADIA NATIONAL CORPORATION
-----------------------------
Chairman of the Board
[Seal]
Attest:
--------------------------
Secretary
<PAGE>
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Certificate of Authentication
This Note is one of the Securities
referred to in the within-mentioned
Indenture.
THE FIRST NATIONAL BANK OF
BOSTON, TRUSTEE
By
--------------------------------
Authorized Officer
[Seal]
<PAGE>
<PAGE>
-3-
LEUCADIA NATIONAL CORPORATION
% Senior Subordinated Note due , 2005
1. Interest.
Leucadia National Corporation (the "Company") prom-
ises to pay interest on the principal amount of this Note at
the rate per annum shown above. The Company will pay interest
semiannually on and of each year.
Interest on the Notes will accrue from the most recent date to
which interest has been paid or, if no interest has been paid,
from , 1995. Interest will be computed on the
basis of a 360-day year of twelve 30-day months.
2. Method of Payment.
The Company will pay interest on the Notes (except
defaulted interest) to the persons who are registered holders
of Notes at the close of business on the June 1 or December 1
next preceding the interest payment date even though Notes are
cancelled after the record date and on or before the interest
payment date. Holders must surrender Notes to a Paying Agent
to collect principal payments. The Company will pay principal
and interest in money of the United States that at the time of
payment is legal tender for payment of public and private
debts. However, the Company may pay interest by check payable
in such money. It may mail an interest check to a Holder's
registered address.
3. Paying Agent, Registrar.
Initially, The First National Bank of Boston will act
as Paying Agent and Registrar. The Company may change any Pay-
ing Agent, Registrar or co-registrar without notice. The Com-
pany or any of its Subsidiaries (as defined in the Indenture)
may act in any such capacity.
4. Indenture.
The Company issued the Notes under an Indenture dated
as of , 1995 (the "Indenture") between the Company
and the Trustee. The terms of the Notes include those stated
in the Indenture and those made part of the Indenture by refer-
ence to the Trust Indenture Act of 1939 (15 U.S. Code
<PAGE>
<PAGE>
-4-
Sections 77aaa-77bbbb) as in effect on the date of the Indenture.
The Notes are subject to all such terms, and Noteholders are
referred to the Indenture and such Act for a statement of such
terms. The Notes are general unsecured subordinated obliga-
tions of the Company limited to $100,000,000 aggregate princi-
pal amount, except as otherwise provided in the Indenture.
5. Subordination.
The Notes are subordinated to Senior Indebtedness,
which is defined in the Indenture. To the extent provided in
the Indenture, Senior Indebtedness must be paid before the
Notes may be paid. Each Noteholder by accepting a Note agrees
to such subordination and authorizes the Trustee to give it
effect.
6. Maintenance of Consolidated Tangible Net Worth.
If, on the last day of each of any two consecutive
fiscal quarters of the Company (the last day of the second such
fiscal quarter being referred to herein as the "Deficiency
Date") the Company's Consolidated Tangible Net Worth is less
than the Minimum Tangible Net Worth, then the Company is
required, no later than 65 days after a Deficiency Date (110
days if a Deficiency Date is the last day of the Company's fis-
cal year), to make an offer to purchase (an "Offer") 10% of the
aggregate principal amount of Notes originally issued (the
"Offer Amount") at a purchase price of 100% of the principal
amount of such Notes, plus accrued interest to the date of pur-
chase. If the aggregate principal amount of Notes tendered to
the Company exceeds the Offer Amount, the Company is required
to purchase the Notes tendered to it pro rata among such Notes
tendered (with such adjustments as may be appropriate so that
only Notes in denominations of $1,000 and integral multiples
thereof shall be purchased). The Company may reduce the prin-
cipal amount of Notes to be purchased pursuant to the Offer by
subtracting 100% of the principal amount of Notes acquired by
the Company subsequent to the Deficiency Date through purchase
(otherwise than pursuant to this provision, pursuant to a
Change of Control offer or pursuant to a Certain Payment or
Investment offer) or exchange, and surrendered for
cancellation.
7. Change of Control.
In the event of a Change of Control of the Company,
each Holder shall have the right, at such Holder's option, to
<PAGE>
<PAGE>
-5-
require the Company to buy all or any portion of such Holder's
Notes, at 101% of the principal amount thereof, plus accrued
interest to the date of purchase.
8. Certain Payments or Investments.
In the event of a Certain Payment or Investment by
the Company, each Holder shall have the right, at such Holder's
option, to require the Company to buy all or any portion of
such Holder's Notes, at 101% of the principal amount thereof,
plus accrued interest to the date of purchase.
9. Restrictive Covenants.
The Indenture imposes certain limitations on, among
other things, the ability of the Company to merge or consoli-
date with any other Person or sell, lease or otherwise transfer
all or substantially all of its properties or assets, the abil-
ity of the Company to pay dividends and to make certain other
distributions and payments and the ability of the Company and
its Subsidiaries to make certain Investments or redeem, retire
or repurchase or acquire for value shares of Capital Stock of
the Company, the ability of the Company and the Subsidiaries to
incur additional Indebtedness and the ability of the Company
and the Subsidiaries to enter into certain transactions with
Affiliates, all subject to certain limitations described in the
Indenture.
10. Denominations, Transfer, Exchange.
The Notes are in registered form without coupons in
denominations of $1,000 and whole multiples of $1,000. A
Holder may transfer or exchange Notes in accordance with the
Indenture. The Registrar may require a Holder, among other
things, to furnish appropriate endorsements and transfer docu-
ments and to pay any taxes and fees required by law or permit-
ted by the Indenture.
11. Persons Deemed Owners.
The registered Holder of a Note may be treated as the
owner of it for all purposes and neither the Company, the Trus-
tee nor any Agent shall be affected by notice to the contrary.
<PAGE>
<PAGE>
-6-
12. Unclaimed Money.
If money for the payment of principal or interest
remains unclaimed for two years, the Trustee or Paying Agent
will pay the money back to the Company at its request. After
that, Noteholders entitled to the money must look to the Com-
pany for payment unless an abandoned property law designates
another person.
13. Amendment, Supplement, Waiver.
Subject to certain exceptions, the Indenture or the
Notes may be amended or supplemented with the consent of the
Holders of at least a majority in principal amount of the
Notes, and any past default or noncompliance with any provision
may be waived with the consent of the Holders of a majority in
principal amount of the Notes. Without the consent of any
Noteholder, the Company may amend or supplement the Indenture
or the Notes to cure any ambiguity, omission, defect or incon-
sistency or to provide for uncertificated Notes in addition to
certificated Notes or to make any change that does not
adversely affect the rights of any Noteholder.
14. Successor Corporation.
When a successor corporation assumes all the obliga-
tions of its predecessor under the Notes and the Indenture, the
predecessor corporation will be released from those
obligations.
15. Defaults and Remedies.
The terms of the Notes include the Events of Default
as set forth in Section 5.01 of the Indenture. Subject to cer-
tain limitations in the Indenture, if an Event of Default
occurs and is continuing, the Trustee or the Holders of at
least 25% in principal amount of the then outstanding Notes may
declare all the Notes to be due and payable immediately, except
that in the case of an Event of Default arising from certain
events of bankruptcy, insolvency or reorganization relating to
the Company, all outstanding Notes shall become due and payable
immediately without further action or notice. Holders may not
enforce the Indenture or the Notes except as provided in the
Indenture. The Trustee may require indemnity satisfactory to
it before it enforces the Indenture or the Notes. Subject to
certain limitations, Holders of a majority in principal amount
of the then outstanding Notes may direct the Trustee in its
<PAGE>
<PAGE>
-7-
exercise of any trust or power. The Company must furnish quar-
terly compliance certificates to the Trustee.
16. Trustee Dealings with Company.
The First National Bank of Boston, the Trustee under
the Indenture, in its individual or any other capacity, may
make loans to, accept deposits from, and perform services for
the Company or its affiliates, and may otherwise deal with the
Company or its affiliates, as if it were not the Trustee.
17. No Recourse Against Others.
A director, officer, employee or stockholder, as
such, of the Company shall not have any liability for any obli-
gations of the Company under the Notes or the Indenture or for
any claim based on, in respect of or by reason of, such obliga-
tions or their creation. Each Noteholder by accepting a Note
waives and releases all such liability. The waiver and release
are part of the consideration for the issue of the Notes.
18. Authentication.
This Note shall not be valid until the Trustee or an
authenticating agent signs the certificate of authentication on
the other side of this Note.
19. Abbreviations.
Customary abbreviations may be used in the name of a
Noteholder or an assignee, such as: TEN COM (=tenants in com-
mon), TEN ENT (=tenants by the entireties), JT TEN (=joint ten-
ants with right of survivorship and not as tenants in common),
CUST (=Custodian), and U/G/M/A (=Uniform Gifts to Minors Act).
The Company will furnish to any Noteholder upon writ-
ten request and without charge a copy of the Indenture.
Requests may be made to: Secretary, Leucadia National Corpora-
tion, 315 Park Avenue South, New York, New York 10010.
<PAGE>
<PAGE>
-8-
ASSIGNMENT FORM
To assign this Note, fill in the form below:
I or we assign and transfer this Note to
-------------------------------------------
: :
-------------------------------------------
(Insert assignee's soc. sec. or tax ID no.)
--------------------------------------------------------------------
--------------------------------------------------------------------
--------------------------------------------------------------------
--------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint
---------------------------------------------
agent to transfer this Note on the books of the Company. The
agent may substitute another to act for him.
--------------------------------------------------------------------
--------------------------------------------------------------------
Your Signature:
---------------------------------------------------
(Sign exactly as your name appears on the
other side of this Note)
Date:
----------------------------
<PAGE>
<PAGE>
-9-
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by
the Company pursuant to Section 3.10, Section 3.11 or Section
3.15 of the Indenture, check the appropriate box:
Section 3.10 [ ]
Section 3.11 [ ]
Section 3.15 [ ]
If you want to have only part of this Note purchased
by the Company pursuant to Section 3.10, Section 3.11 or Sec-
tion 3.15 of the Indenture, state the amount (in integral mul-
tiples of $1,000):
$
Date: Signature:
--------------------- -----------------------
(Sign exactly as your
name appears on the
other side of this
Note)
Signature Guarantee:
-------------------------------------
<PAGE>
EXHIBIT 12
STATEMENT OF COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Excluding Interest on Customer Banking Deposits)
<TABLE>
<CAPTION>
Three Months
Ended March 31, Year Ended December 31,
--------------- ------------------------------------------------
1995 1994 1994 1993 1992 1991 1990
---- ---- ---- ---- ---- ---- ----
(Dollars In Thousands)
<S> <C> <C> <C> <C> <C> <C> <C>
Income from continuing operations
before extraordinary items and
cumulative effect of change in
accounting principles $ 16,323 $ 14,219 $ 70,836 $116,259 $130,607 $ 94,380 $ 65,010
Add (Deduct):
Income taxes 7,099 7,815 29,482 60,609 12,946 200 13,928
Fixed charges per below 10,621 10,436 42,423 37,299 34,319 26,933 24,425
Equity in undistributed
earnings of less than 50%
owned companies 105 2,765 5,176 2,064 1,891 722 248
------- ------- -------- -------- -------- -------- --------
Income as adjusted $34,148 $35,235 $147,917 $216,231 $179,763 $122,235 $103,611
======= ======= ======== ======== ======== ======== ========
Fixed charges:
Interest on indebtedness
(excluding customer banking
deposits) $ 9,102 $ 8,723 $ 35,699 $ 30,464 $26,553 $21,787 $20,459
Amortization of debt expense
and premium 379 249 1,202 983 836 501 687
Portion of rents representative
of the interest factor (1/3
of rents) 1,140 1,464 5,522 5,852 6,930 4,645 3,279
------- ------- ------- ------- ------- ------- -------
$10,621 $10,436 $42,423 $37,299 $34,319 $26,933 $24,425
======= ======= ======= ======= ======= ======= =======
Ratio of earnings to fixed
charges 3.22 3.38 3.49 5.80 5.24 4.54 4.24
======= ======= ======= ======= ======= ======= =======
</TABLE>
<PAGE>
<PAGE>
EXHIBIT 12
STATEMENT OF COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Including Interest on Customer Banking Deposits)
<TABLE>
<CAPTION>
Three Months
Ended March 31, Year Ended December 31,
--------------- ------------------------------------------------
1995 1994 1994 1993 1992 1991 1990
---- ---- ---- ---- ---- ---- ----
(Dollars In Thousands)
<S> <C> <C> <C> <C> <C> <C> <C>
Income from continuing operations
before extraordinary items and
cumulative effect of change in
accounting principles $16,323 $14,219 $ 70,836 $116,259 $130,607 $ 94,380 $ 65,010
Add (Deduct):
Income taxes 7,099 7,815 29,482 60,609 12,946 200 13,928
Fixed charges per below 13,316 12,484 50,727 46,300 46,273 42,071 38,570
Equity in undistributed
earnings of less than 50%
owned companies 105 2,765 5,176 2,064 1,891 722 248
------- ------- -------- -------- -------- -------- --------
Income as adjusted $36,843 $37,283 $156,221 $225,232 $191,717 $137,373 $117,756
======= ======= ======== ======== ======== ======== ========
Fixed charges:
Interest on indebtedness $11,797 $10,771 $44,003 $39,465 $38,507 $36,925 $34,604
Amortization of debt expense
and premium 379 249 1,202 983 836 501 687
Portion of rents representative
of the interest factor (1/3
of rents) 1,140 1,464 5,522 5,852 6,930 4,645 3,279
------- ------- ------- ------- ------- ------- -------
$13,316 $12,484 $50,727 $46,300 $46,273 $42,071 $38,570
======= ======= ======= ======= ======= ======= =======
Ratio of earnings to fixed
charges 2.77 2.99 3.08 4.86 4.14 3.27 3.05
======= ======= ======= ======= ======= ======= =======
</TABLE>
NYFS04...:\30\76830\0001\1980\EXH5195W.340
<PAGE>
EXHIBIT 25
SECURITIES ACT OF 1933 FILE NO:
(IF APPLICATION TO DETERMINE ELIGIBILITY
OF TRUSTEE FOR DELAYED OFFERING PURSUANT
TO SECTION 305(b)(2))
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------
FORM T-1
STATEMENT OF ELIGIBILITY AND QUALIFICATION 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 FIRST NATIONAL BANK OF BOSTON
---------------------------------------------------------------------------
(Exact name of trustee as specified in its charter)
04-2472499
----------------------
(I.R.S. Employer Identification No.)
100 Federal Street
Boston, Massachusetts 02110
--------------------------------------------- ----------------------
(Address of principal executive offices) (Zip Code)
Gary A. Speiss, Cashier and General Counsel
100 Federal Street, 24th Floor, Boston, Massachusetts 02110
(617) 434-2870
---------------------------------------------------------------------------
(Name, address and telephone number of agent for service)
Leucadia National Corporation
---------------------------------------------------------------------------
(Exact name of obligor as specified in its charter)
New York 13-2615557
--------------------------------------------- ----------------------
(State or other jurisdiction of incorporation (I.R.S. Employer
or organization) Identification No.)
315 Park Avenue South
New York, NY 10010-3607
--------------------------------------------- ----------------------
(Address of principal executive offices) (Zip Code)
Senior Subordinated Notes
---------------------------------------------------------------------------
(Title of the indenture securities)
<PAGE>
<PAGE>
1. GENERAL INFORMATION.
Furnish the following information as to the trustee:
(a) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY
TO WHICH IT IS SUBJECT.
Comptroller of the Currency of the United States, Washington D.C.
Board of Governors of the Federal Reserve System, Washington, D.C
Federal Deposit Insurance Corporation, Washington, D.C.
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Trustee is authorized to exercise corporate trust powers.
2. AFFILIATIONS WITH OBLIGOR AND UNDERWRITERS.
IF THE OBLIGOR OR ANY UNDERWRITER FOR THE OBLIGOR IS AN
AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH AFFILIATION.
None with respect to the Trustee.
(See Notes on page 2)
None with respect to Bank of Boston Corporation.
3. THROUGH 11. NOT APPLICABLE.
12. INDEBTEDNESS OF THE OBLIGOR TO THE TRUSTEE
<TABLE>
<CAPTION>
COL. A COL. B COL. C
AMOUNT
NATURE OF INDEBTEDNESS OUTSTANDING DATE DUE
---------------------- ----------- --------
<S> <C> <C>
$6,000,000 Term Loan $6,000,000 6/30/99
$25,000,000 Revolving Loan -0- 6/30/97
$15,000,000 OTL - Swap $1,861,000 6/30/99
13. THROUGH 15. NOT APPLICABLE.
16. LIST OF EXHIBITS.
LIST BELOW ALL EXHIBITS FILED AS PART OF THIS STATEMENT OF
ELIGIBILITY AND QUALIFICATION.
1. A COPY OF THE ARTICLES OF ASSOCIATION OF THE TRUSTEE AS
NOW IN EFFECT.
A certified copy of the Articles of Association of the
trustee is filed as Exhibit No. 1 to statement of eligibility and
qualification No. 22-9514 and is incorporated herein by reference
thereto.
2. A COPY OF THE CERTIFICATE OF AUTHORITY OF THE TRUSTEE TO
COMMENCE BUSINESS, IF NOT CONTAINED IN THE ARTICLES OF ASSOCIATION.
<PAGE>
<PAGE>
A copy of the certificate of T. McLean Griffin, Cashier of the
trustee, dated February 3, 1978, as to corporate succession containing
copies of the Certificate of the Comptroller of the Currency that The
Massachusetts Bank, National Association, into which The First
National Bank of Boston was merged effective January 4, 1971, is
authorized to commence the business of banking as a national banking
association, as well as a certificate as to such merger is filed as
Exhibit No. 2 to statement of eligibility and qualification No. 22-
9514 and is incorporated herein by reference thereto.
3. A COPY OF THE AUTHORIZATION OF THE TRUSTEE TO EXERCISE
CORPORATE TRUST POWERS, IF SUCH AUTHORIZATION IS NOT CONTAINED IN THE
DOCUMENTS SPECIFIED IN PARAGRAPH (1) OR (2) ABOVE.
A copy of a certificate of the Office of the Currency dated
February 6,1978 is filed as Exhibit No. 3 to statement of eligibility
and qualification No. 22-9514 and is incorporated herein by reference
thereto.
4. A COPY OF THE EXISTING BY-LAWS OF THE TRUSTEE, OR INSTRUMENTS
CORRESPONDING THERETO.
A certified copy of the existing By-Laws of the trustee dated
December 23,1993 is filed as Exhibit No. 4 to statement of eligibility
and qualification No. 22-25754 and is incorporated herein by reference
thereto.
5. THE CONSENT OF THE TRUSTEE REQUIRED BY SECTION 321(B) OF THE
ACT.
The consent of the trustee required by Section 321(b) of the Act
is annexed hereto and made a part hereof.
6. A COPY OF THE LATEST REPORT OF CONDITION OF THE TRUSTEE
PUBLISHED PURSUANT TO LAW OR THE REQUIREMENTS OF ITS SUPERVISING OR
EXAMINING AUTHORITY.
A copy of the latest report of condition of the trustee published
pursuant to law or the requirements of its supervising or examining
authority is annexed hereto as Exhibit 7 and made a part hereof.
<PAGE>
<PAGE>
NOTES
In answering any item in this Statement of Eligibility and
Qualification which relates to matters peculiarly within the knowledge
of the obligor or any underwriter for the obligor, the trustee has
relied upon information furnished to it by the obligor and the
underwriters, and the trustee disclaims responsibility for the
accuracy or completeness of such information.
The answer furnished to Item 2 of this statement will be amended,
if necessary, to reflect any facts which differ from those stated and
which would have been required to be stated if known at the date
hereof.
<PAGE>
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
trustee, The First National Bank of Boston, a national banking
association organized and existing under the laws of The United States
of America, has duly caused this statement of eligibility and
qualification to be signed on its behalf by the undersigned, thereunto
duly authorized, all in the Town of Canton and Commonwealth of
Massachusetts, on the 23rd day of May, 1995.
THE FIRST NATIONAL BANK OF BOSTON, Trustee
By: /s/Mark Nelson
--------------
Mark Nelson
Authorized Officer
EXHIBIT 6
CONSENT OF TRUSTEE
Pursuant to the requirements of Section 321(b) of the Trust
Indenture Act of 1939 in connection with the proposed issue by
Leucadia NatIonal Corporation of Senior Subordinated Notes, we hereby
consent that reports of examinations by Federal, State, Territorial,
or District authorities may be furnished by such authorities to the
Securities and Exchange CommIssion upon request therefor.
THE FIRST NATIONAL BANK OF BOSTON, Trustee
By: /s/Mark Nelson
--------------
Mark Nelson
Authorized Officer
<PAGE>
<PAGE>
EXHIBIT 7
C0NS0LIDATED REPORT OF C0NDITION, INCLUDING DOMESTIC AND FOREIGN
SUBSIDIARIES, OF
THE FIRST NATIONAL BANK OF BOSTON
In the Commonwealth of Massachusetts, at the close of
business on December 31,1994. Published in response to call made
by Comptroller of the Currency, under Title 12, United States
Code, Section 161. Charter number 200. Comptroller of the
Currency Northeastern District.
</TABLE>
<TABLE>
<CAPTION>
ASSETS
Dollar
Amounts in
Thousands
-------------
<S> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin $ 1,862,093
Interest-bearing balances 1,551,280
Securities 3,935,691
Federal funds sold and securities purchased under agreements to resell
in domestic offices of the bank and of its Edge and Agreement subsidiaries, and in
IBF's:
Federal funds sold 758,937
Securities purchased under agreements to resell 0
Loans and lease financing receivables:
Loans and leases, net of unearned income $25,796,462
LESS: Allowance for loan and lease losses 534,630
LESS: Allocated transfer risk reserve 0
Loans and leases, net of unearned income, allowance and reserve 25,261,832
Assets held in trading accounts 840,348
Premises and fixed assets (including capitalized leases) 398,475
Other real estate owned 48,504
Investments in unconsolidated subsidiaries and associated companies 103,670
Customers' liability to this bank on acceptances outstanding 304,031
Intangible assets 651,394
Other assets 1,170,251
-----------
Total Assets $36,886,506
===========
<CAPTION>
LIABILITIES
<S> <C>
Deposits:
In domestic offices $14,924,310
Noninterest-bearing $ 4,035,673
Interest-bearing 10,888,637
In foreign offices, Edge and Agreement subsidiaries, and IBF's 9,998,764
Noninterest-bearing 570,582
Interest-bearing 9,428,182
Federal funds purchased and securities sold under agreements to repurchase in domestic
offices of the bank and of its Edge and Agreement subsidiaries, and in IBF's:
Federal funds purchased 2,464,904
Securities sold under agreements to repurchase 277,077
Demand notes issued to the U.S. Treasury 364,045
Trading Liabilities 227,865
Other borrowed money 3,875,462
Mortgage indebtedness and obligations under capitalized lease 14,007
Bank's liability on acceptances executed and outstanding 305,512
Subordinated notes and debentures 979,167
Other liabilities 1,022,105
Total Liabilities $34,453,218
===========
Limited-life preferred stock and equity capital 0
<PAGE>
<PAGE>
<CAPTION>
EQUITY CAPITAL
<S> <C>
Perpetual preferred stock and related surplus $ 0
Common stock 82,264
Surplus 987,524
Undivided profits and capital reserves 1,408,062
LESS: Net unrealized loss on marketable equity securities (39,027)
Cumulative foreign currency translation adjustments (5,535)
Total equity capital 2,433,288
-----------
Total Liabilities, Limited-life preferred stock, and equity $36,866,506
===========
</TABLE>
NYFS04...:\30\76830\0001\6678\FRM5245P.250
<PAGE>
<PAGE>
I, Robert T. Jefferson, Comptroller of the above-named bank, do
hereby declare that this Report of Condition is true and correct to
the best of my knowledge and belief.
ROBERT T. JEFFERSON
FEBRUARY 13, 1995
We, the undersigned directors, attest to the correctness of this
statement of resources and liabilities. We 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 and is true and correct.
CHARLES K. GIFFORD
IRA STEPANIAN
J. DONALD MONAN
DIRECTORS
FEBRUARY 13,1995
