<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, VIA THE EDGAR SYSTEM, ON
, 1995
REGISTRATION NO. 33-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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<TABLE>
<S> <C>
ADVANTA CORP. ADVANTA CAPITAL L.L.C.
</TABLE>
(EXACT NAMES OF REGISTRANTS AS SPECIFIED IN THEIR CHARTERS)
<TABLE>
<S> <C>
DELAWARE DELAWARE
(STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION)
23-1462070 51-0366786
(IRS EMPLOYER IDENTIFICATION NO.) (IRS EMPLOYER IDENTIFICATION NO.)
BRANDYWINE CORPORATE CENTER 501 CARR ROAD
650 NAAMANS ROAD WILMINGTON, DELAWARE 19809
CLAYMONT, DELAWARE 19703 (302) 791-4400
(302) 791-4400
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF EACH REGISTRANT'S PRINCIPAL
EXECUTIVE OFFICE)
</TABLE>
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GENE S. SCHNEYER, ESQ.
ADVANTA CORP.
FIVE HORSHAM BUSINESS CENTER
300 WELSH ROAD
HORSHAM, PENNSYLVANIA 19044-9808
(215) 657-4000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
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Approximate date of commencement of proposed sale to the public: From time
to time after this Registration Statement becomes effective.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
registration statement for the same offering. / /
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier registration statement for the same
offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434
under the Securities Act, please check the following box. /X/
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CALCULATION OF REGISTRATION FEE
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<TABLE>
<S> <C> <C> <C> <C>
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Proposed Proposed
Maximum Maximum
Amount Offering Aggregate Amount of
Title of Each Class of to be Price Offering Registration
Securities Being Registered Registered(1) Per Unit(1)(2) Price(1)(2) Fee
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Advanta Corp. Debt Securities(3)(4).........
Advanta Corp. Class B Preferred Stock(5)....
Advanta Corp. Depositary Shares(5)(6).......
Advanta Corp. Debt Warrants(7)..............
Advanta Corp. Preferred Stock Warrants(7)...
Advanta Corp. Common Stock Warrants(7)...... $500,000,000 100% $500,000,000 $172,415
Advanta Corp. Class B Common Stock, par
value $.01 per share(5)...................
Advanta Corp. Stock Purchase Contracts(8)...
Advanta Corp. Stock Purchase Units(9).......
Advanta Corp. Capital Securities(5).........
Advanta Corp. Guarantees(10)................
Advanta Capital L.L.C. Preferred
Shares(5).................................
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</TABLE>
(Footnotes on following page)
------------------------
THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY
ITS EFFECTIVE DATE UNTIL THE REGISTRANTS 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
THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE
COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
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<PAGE> 2
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(1) Not specified as to each class of Securities to be registered pursuant to
General Instruction II.D of Form S-3. In no event will the aggregate
initial offering price of the Securities issued under this Registration
Statement exceed $500,000,000 or the equivalent thereof in one or more
foreign currencies or composite currencies, including European currency
units. Securities registered hereby may be sold separately, together or in
units with other Securities registered hereunder.
(2) Estimated solely for the purpose of computing the registration fee pursuant
to Rule 457(o). The proposed maximum offering price per unit will be
determined from time to time by the Registrants in connection with the
issuance by the Registrants of the Securities registered hereunder.
(3) If any Advanta Corp. Debt Securities are issued at an original issue
discount, then the amount to be registered shall be equal to such amount as
may result in the initial offering prices for Advanta Corp. Debt Securities
and Advanta Corp. Debt Warrants, if any.
(4) In addition to any Advanta Corp. Debt Securities that may be issued
directly under this Registration Statement, there is being registered
hereunder an indeterminate amount of Advanta Corp. Debt Securities that may
be issued upon conversion or exchange of other Debt Securities or Class B
Preferred Stock of Advanta Corp. or Preferred Shares of Advanta Capital
L.L.C., and an indeterminate amount of subordinated debt securities which
may be issued by Advanta Corp. to evidence the loan by Advanta Capital
L.L.C. to Advanta Corp. of any proceeds from the offer and sale of Advanta
Capital L.L.C. Preferred Shares and other capital contributions to Advanta
Capital L.L.C., for which no separate consideration will be received.
(5) In addition to any Advanta Corp. Class B Preferred Stock, Depositary Shares
or Advanta Corp. Class B Common Stock that may be issued directly under
this Registration Statement, there are being registered hereunder an
indeterminate amount and number of Capital Securities of Advanta Corp.,
which may consist of shares of Advanta Corp. Class B Preferred Stock,
Advanta Corp. Class B Common Stock, Advanta Corp. Depositary Shares or
other Advanta Corp. Capital Securities that may be issued upon conversion
or exchange, either at the option of the holder or the Registrants, of
Advanta Corp. Debt Securities, Advanta Corp. Class B Preferred Stock,
Advanta Corp. Depositary Shares or Advanta Capital L.L.C. Preferred Shares,
as the case may be, for which no separate consideration will be received.
(6) There are being registered hereunder an indeterminate number of Advanta
Corp. Depositary Shares to be evidenced by depositary receipts issued
pursuant to a Deposit Agreement. In the event the Registrants elect to
offer to the public fractional interests in shares of the Advanta Corp.
Class B Preferred Stock registered hereunder, depositary receipts will be
distributed to those persons purchasing such fractional interests and the
shares of Advanta Corp. Class B Preferred Stock will be issued to the
depositary under the Deposit Agreement.
(7) There are being registered hereunder Advanta Corp. Debt Warrants, Advanta
Corp. Preferred Stock Warrants and Advanta Corp. Common Stock Warrants
(collectively, "Advanta Corp. Securities Warrants") entitling the holder to
purchase Advanta Corp. Debt Securities, Advanta Corp. Class B Preferred
Stock and Advanta Corp. Class B Common Stock, respectively, which may be
sold separately or as units with Advanta Corp. Debt Securities, Advanta
Corp. Class B Preferred Stock or Advanta Corp. Class B Common Stock. The
Advanta Corp. Securities Warrants will represent rights to purchase only
Advanta Corp. Debt Securities, Advanta Corp. Class B Preferred Stock and
Advanta Corp. Class B Common Stock covered by this Registration Statement.
(8) There are being registered hereunder an indeterminate amount and number of
Advanta Corp. Stock Purchase Contracts, representing rights to purchase
Advanta Corp. Class B Preferred Stock or Advanta Corp. Class B Common
Stock.
(9) There are being registered hereunder an indeterminate amount and number of
Advanta Corp. Stock Purchase Units, representing ownership of Advanta Corp.
Stock Purchase Contracts and debt obligations of the United States of
America or agencies or instrumentalities thereof. The registration fee has
been calculated based upon a maximum offering price not including such debt
obligations.
(10) No separate consideration will be received for any Advanta Corp. Guarantee.
<PAGE> 3
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.
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED , 1995
PROSPECTUS
US$500,000,000
DEBT SECURITIES
CLASS B PREFERRED STOCK
CLASS B COMMON STOCK
DEPOSITARY SHARES
WARRANTS
STOCK PURCHASE CONTRACTS
STOCK PURCHASE UNITS
ADVANTA CAPITAL L.L.C.
PREFERRED SHARES
GUARANTEED TO THE EXTENT SET FORTH HEREIN BY
ADVANTA CORP.
Advanta Corp., a Delaware corporation ("Advanta"), may offer from time to
time in one or more series hereunder, together or separately, at prices and on
terms to be determined at the time of offering (i) its debt securities ("Debt
Securities"), consisting of debentures, notes and/or other evidences of
indebtedness representing unsecured obligations of Advanta, which may be either
senior or subordinated and which may be convertible into or exchangeable for
Class B Common Stock (as defined below), Class B Preferred Stock (as defined
below), other Capital Securities (as defined herein) or other Debt Securities,
(ii) shares of its Class B Preferred Stock, par value $.01 per share ("Class B
Preferred Stock"), which may be issued in the form of depositary shares
evidenced by depositary receipts (the "Depositary Shares") and which may be
convertible into or exchangeable for Class B Common Stock, other Capital
Securities or Debt Securities, (iii) shares of its Class B Common Stock, par
value $.01 per share (the "Class B Common Stock"), (iv) its warrants to purchase
Debt Securities ("Debt Warrants"), shares of Class B Preferred Stock ("Preferred
Stock Warrants") or shares of Class B Common Stock ("Common Stock Warrants"),
(v) its Stock Purchase Contracts ("Stock Purchase Contracts") to purchase Class
B Preferred Stock or Class B Common Stock and (vi) Stock Purchase Units ("Stock
Purchase Units"), each representing ownership of a Stock Purchase Contract and
debt obligations of the United States of America or agencies or
instrumentalities thereof securing the holder's obligation to purchase the Class
B Preferred Stock or Class B Common Stock under the Stock Purchase Contract. The
Debt Warrants, Preferred Stock Warrants and Common Stock Warrants are herein
referred to as the "Securities Warrants" and together with the Debt Securities,
Class B Preferred Stock, Depositary Shares, Class B Common Stock, Stock Purchase
Contracts, Stock Purchase Units and other Capital Securities and the Preferred
Shares and Backup Undertakings referred to below, the "Securities."
Advanta Capital L.L.C., a limited liability company formed under the laws
of the State of Delaware and a special purpose finance subsidiary of Advanta
("Advanta Capital"), may also offer from time to time in one or more series, at
prices and on terms to be determined at the time of offering, its Preferred
Shares (the "Preferred Shares") representing preferred limited liability company
interests in Advanta Capital which may be convertible into or exchangeable for
Capital Securities of Advanta. In connection therewith, Advanta may offer backup
undertakings ("Backup Undertakings") with respect to the Preferred Shares, as
described herein under "Description of Preferred Shares of Advanta Capital." Any
issue of Preferred Shares and related Backup Undertakings shall correspondingly
reduce the amount of other Securities available for offer and sale hereunder.
The specific terms of the Securities in respect of which this Prospectus is
being delivered will be set forth in an accompanying Prospectus Supplement (the
"Prospectus Supplement") which will describe, without limitation and where
applicable, terms such as (i) in the case of Debt Securities, the specific
designation, aggregate principal amount, currency, denomination, maturity,
priority, rate of interest (which may be fixed or variable), time and place of
payment of interest, terms for optional redemption or repayment by Advanta or
any holder or for sinking fund payments, terms for conversion or exchange into
Capital Securities or other Debt Securities, if any, the initial public offering
price, any stock exchange listings, any special
(continued on following page)
<PAGE> 4
(continued from previous page)
provisions related to Debt Securities denominated in a foreign currency or
issued as medium term notes, original issue discount or other special terms, and
the designation of the Trustee, Security Registrar and Paying Agent, (ii) in the
case of Class B Preferred Stock, the specific title and stated value, number of
shares or fractional interests therein, any dividend, liquidation, redemption,
sinking fund, voting or other rights, the terms for conversion or exchange into
other Capital Securities or Debt Securities, any stock exchange listings, and
the initial public offering price, (iii) in the case of the Depositary Shares,
the fraction of a share of Class B Preferred Stock represented by one Depositary
Share, (iv) in the case of the Class B Common Stock, the aggregate number of
shares offered, initial public offering price and other terms thereof, (v) in
the case of Securities Warrants, where applicable, the duration, offering price,
exercise price, terms of the Securities for which they are exercisable, any
listing on a securities exchange and detachability and other terms thereof, (vi)
in the case of Stock Purchase Contracts, the designation and number of shares of
Class B Preferred Stock or Class B Common Stock issuable thereunder, the
purchase price of the Class B Preferred Stock or Class B Common Stock, the date
or dates on which the Class B Preferred Stock or Class B Common Stock is
required to be purchased by the holders of the Stock Purchase Contracts, any
periodic payments required to be made by Advanta to the holders of the Stock
Purchase Contracts or vice versa, and the terms of the offering and sale
thereof, (vii) in the case of Stock Purchase Units, the specific terms of the
Stock Purchase Contracts and any debt obligations securing the holder's
obligation to purchase the Class B Preferred Stock or Class B Common Stock under
the Stock Purchase Contracts, and the terms of the offering and sale thereof,
and (viii) in the case of the Preferred Shares and Backup Undertakings, the
specific designation, stated value and liquidation preference per share or
security and number of shares or securities offered, the initial public offering
price, dividend rate (which may be fixed or variable), method of calculating
payment of dividends, dates on which dividends will be payable, place or places
where dividends will be payable, the terms of redemption, the terms for
conversion or exchange into Capital Securities of Advanta, any listing on a
securities exchange and the terms of the Backup Undertakings. The Prospectus
Supplement will also contain information, where applicable, about certain U.S.
federal income tax, accounting or other considerations relating to the
Securities covered thereby.
The initial offering price to the public of the Securities will be limited
to US $500,000,000 in the aggregate (or its equivalent based on the applicable
exchange rate at the time of issue, if Securities are offered for consideration
denominated in one or more foreign currencies or currency units as shall be
designated by Advanta). The Debt Securities may be denominated in United States
dollars or, at the option of Advanta if so specified in the applicable
Prospectus Supplement, in one or more foreign currencies or currency units. The
Debt Securities may be issued in registered form or bearer form, or both. If so
specified in the applicable Prospectus Supplement, Debt Securities of a series
may be issued in whole or in part in the form of one or more temporary or
permanent global securities.
The Securities may be sold to or through dealers or underwriters, directly
to other purchasers or through agents. If an agent of Advanta or Advanta Capital
or a dealer or an underwriter is involved in the sale of the Securities in
respect of which this Prospectus is being delivered, the agent's commission or
dealer's purchase price or underwriter's discount will be set forth in, or may
be calculated from, the Prospectus Supplement. Any underwriters, dealers or
agents participating in the offering of Securities may be deemed "underwriters"
within the meaning of the Securities Act of 1933, as amended (the "Securities
Act"). The Securities may also be used as all or part of the consideration to be
paid by Advanta for property or assets. See "Plan of Distribution" for possible
indemnification arrangements for any agents, dealers or underwriters.
This Prospectus may not be used to consummate sales of Securities unless
accompanied by a Prospectus Supplement.
THE DEBT SECURITIES WILL NOT BE SAVINGS ACCOUNTS, DEPOSITS OR OTHER
OBLIGATIONS OF ANY BANK OR NON-BANK SUBSIDIARY OF ADVANTA, AND WILL NOT BE
INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER FEDERAL OR
STATE AGENCY.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
------------------------
The date of this Prospectus is , 1995.
<PAGE> 5
AVAILABLE INFORMATION
Advanta is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information can be inspected and copied at the public
reference facilities maintained by the Commission at Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the following Regional Offices of
the Commission: Seven World Trade Center, 13th Floor, New York, N.Y. 10048; and
Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661.
Copies of such material may also be obtained at prescribed rates from the Public
Reference Section of the Commission at Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549.
Advanta and Advanta Capital have filed with the Commission a registration
statement on Form S-3 (together with all amendments and exhibits thereto, the
"Registration Statement") under the Securities Act with respect to the
Securities offered hereby. This Prospectus does not contain all of the
information set forth in the Registration Statement. For further information
with respect to Advanta, Advanta Capital and the Securities offered hereby,
reference is made to the Registration Statement. Statements contained herein
concerning any document are not necessarily complete and, in each instance,
reference is made to the copy of such document filed as an exhibit to the
Registration Statement. Each such statement is qualified in its entirety by such
reference. Copies of all or any part of the Registration Statement, including
exhibits thereto, may be obtained, upon payment of the prescribed fees, at the
offices of the Commission as set forth above.
No separate financial statements of Advanta Capital have been included
herein. Advanta and Advanta Capital do not consider that such financial
statements would be material to holders of any Preferred Shares which may be
offered hereby because Advanta Capital is a newly organized special purpose
subsidiary, has no operating history or independent operations, is not engaged
in and does not propose to engage in any activity other than the issuance of its
common and preferred limited liability company interests and the lending of the
proceeds thereof to Advanta and because Advanta will issue a full and
unconditional guarantee of any Preferred Shares, as described in the
accompanying Prospectus Supplement. See "Description of Preferred Shares of
Advanta Capital." Advanta Capital is a limited liability company organized under
the laws of the State of Delaware and will be managed by Advanta, which directly
or indirectly beneficially owns all of Advanta Capital's common limited
liability company interests, which are non-transferable. Financial statements of
Advanta Capital will be made available to the holders of Preferred Shares
annually as soon as practicable after the end of Advanta Capital's fiscal year.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
As required by the Commission, Advanta hereby incorporates by reference:
1. Advanta's Annual Report on Form 10-K for the fiscal year ended December
31, 1994;
2. Advanta's Current Reports on Form 8-K dated January 24, and April 19,
1995;
3. Advanta's Quarterly Report on Form 10-Q for the quarter ended March 31,
1995; and
4. The descriptions of Advanta's Class A Common Stock and Class B Common
Stock which are contained in the Registration Statements on Form 8-A
filed by Advanta to register such securities under Section 12 of the
Exchange Act, File No. 0-14120, including any amendment or report filed
for the purpose of updating such descriptions.
All documents filed by Advanta pursuant to Sections 13(a), 13(c), 14 and
15(d) of the Exchange Act subsequent to the date of this Prospectus and prior to
the termination of the offering described herein shall be deemed to be
incorporated by reference in the Registration Statement and to be a part hereof
from the date of filing of such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed to
be modified or superseded for
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<PAGE> 6
purposes hereof to the extent that a statement contained herein or any
subsequently filed document which is deemed to be incorporated by reference
herein modifies or supersedes such document. Any statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part hereof.
Advanta will provide without charge to each person to whom a copy of this
Prospectus is delivered, upon written or oral request, a copy of any document
incorporated herein by reference (other than exhibits to such document which are
not specifically incorporated by reference in such document). Requests for such
documents should be directed to: Investor Relations, Advanta Corp., Five Horsham
Business Center, 300 Welsh Road, Horsham, Pennsylvania 19044-2209, telephone
(215) 784-5335.
ADVANTA CORP.
GENERAL
Advanta is a highly focused direct marketer of select consumer financial
services. Advanta primarily originates and services credit cards and mortgage
loans. Other businesses include small ticket equipment leasing, credit insurance
and deposit products. At December 31, 1994, assets under management totaled $9.3
billion.
Approximately 78% of total revenues are derived from credit cards marketed
through carefully targeted direct mail campaigns. By focusing primarily on the
no fee gold card, Advanta has successfully grown to one of the ten largest
issuers of gold cards. Mortgage services contribute 9% of total revenues.
Advanta's principal executive office is located at Brandywine Corporate
Center, 650 Naamans Road, Claymont, Delaware 19703. Its principal operating
office is located at Five Horsham Business Center, 300 Welsh Road, Horsham,
Pennsylvania 19044-9808. Advanta's telephone numbers at its principal executive
and operating offices are, respectively, (302) 791-4400 and (215) 657-4000.
CREDIT CARDS
Advanta, which has been in the credit card business since 1983, issues gold
and standard MasterCard(R)* and VISA(R)* credit cards nationwide. Advanta has
built a substantial cardholder base which, as of December 31, 1994, totaled 3.8
million accounts and $6.5 billion in managed receivables.
In 1982, Advanta acquired Colonial National Bank USA ("Colonial National").
As a national bank, Colonial National has the ability to make loans to consumers
without many of the restrictions found in various state usury and licensing
laws, to negotiate variable rate loans, to generate funds economically in the
form of deposits insured by the Federal Deposit Insurance Corporation ("FDIC"),
and to include in its product mix a MasterCard(R) and VISA(R) credit card
program. Substantially all of Advanta's credit card receivables and bank
deposits are originated by Colonial National.
Advanta believes that its targeted marketing strategy and its emphasis on
satisfying customers have enabled it to attract and retain a portfolio of credit
card accounts with a loss ratio which, based on reports published by
MasterCard(R) and VISA(R), has been below industry averages for the past three
years. Colonial National's net credit loss on average managed credit card
receivables outstanding for the year ended December 31, 1994 was 2.5%, and the
percentage of managed credit card receivables that were delinquent 30 or more
days was 2.0%. With customers in all 50 states, Advanta's credit card portfolio
is geographically diversified. At December 31, 1994, the states with the highest
aggregate managed loans outstanding were California, New York, Texas, Florida
and Illinois, with approximately
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* MasterCard(R) is a federally registered servicemark of MasterCard
International, Inc.; VISA(R) is a federally registered servicemark of VISA
U.S.A., Inc.
3
<PAGE> 7
17.2%, 7.0%, 6.4%, 5.7% and 4.7%, respectively, of Colonial National's total
managed credit card receivables.
Since 1988, Colonial National has been active in the credit card
securitization market, selling $2.8 billion of card asset-backed certificates in
1994 and $6.6 billion since 1988.
In February 1995, Advanta National Bank ("ANB"), a new federally chartered
institution organized by Advanta, opened for business. Currently, ANB assets do
not represent a significant portion of Advanta's assets. However, Advanta
anticipates that ANB will, in the future, become the originator of a substantial
portion of Advanta's credit card assets.
MORTGAGE LOANS
Advanta's subsidiary, Advanta Mortgage Corp. USA ("Advanta Mortgage"),
originates, purchases, securitizes and services non-conforming credit first and
second mortgage loans for itself and for Colonial National's "Advanta Mortgage
USA" Division. Loan production is generated through a centralized direct
origination center, a broker network serviced by selected sales locations, and
correspondent relationships.
Advanta Mortgage and Colonial National originate or purchase loans and then
sell or securitize them, generally retaining servicing rights and the related
excess cash flows. Consequently, the mortgage loan receivables on Advanta's
balance sheet are generally its most recently originated loans being held for
sale. Thus, while mortgage loan receivables owned at December 31, 1994 were $143
million, during 1994 Advanta originated or purchased $493 million and
securitized $456 million of such receivables. Advanta Mortgage services Colonial
National's mortgage loan portfolio, packages Colonial National's mortgage loans
for sale, and performs the servicing on loans sold by Colonial National where
Colonial National retains the servicing rights and obligations. In addition,
Advanta Mortgage performs fee-based servicing on loans originated and owned by
unrelated third party mortgage lenders. As of December 31, 1994, Advanta
Mortgage was servicing approximately $1.2 billion in mortgage loans sold by
Advanta's subsidiaries, as well as $190 million of "contract servicing"
receivables.
Approximately 71% of the managed portfolio is secured by first mortgages
and the balance is secured by second mortgages. At December 31, 1994, the states
with the highest managed loans outstanding were California, New York, New
Jersey, Maryland, and Pennsylvania, with approximately 23.5%, 12.3%, 11.4%,
10.3% and 8.0%, respectively.
While Advanta has not historically offered mortgage lines of credit, which
involve the extension of a revolving amount of credit to a borrower, Advanta is
planning to offer a home equity line of credit product beginning in 1995.
Advanta has established a new consumer finance company, Advanta Finance Corp.,
which will provide another loan origination source, with loans marketed directly
to the consumer through a branch office system. The first Advanta Finance Corp.
branch offices opened in the first quarter of 1995.
EQUIPMENT LEASING AND OTHER SMALL BUSINESS SERVICES
Advanta's subsidiary, Advanta Business Services Corp. ("ABS"), formerly
Advanta Leasing Corp., engages primarily in non-cancelable financing leases of
equipment, including computers, security systems, copiers and telephone systems,
primarily to professionals and small businesses. The average initial cost of
leased equipment is approximately $7,000. Costs relating to equipment
maintenance, insurance and personal property taxes are the responsibility of the
lessee. ABS securitized $68 million and $102 million of lease receivables in
1993 and 1994, respectively.
In the third quarter of 1994, ABS began marketing business credit cards
which are issued through Advanta Financial Corp. ("AFC"), formerly Colonial
National Financial Corp., to its small business customers. As of December 31,
1994, the receivables on these cards issued were immaterial to Advanta.
4
<PAGE> 8
ABS's 1994 originations, including $29 million of portfolio acquisitions,
totaled $190 million. At December 31, 1994, ABS serviced a portfolio of $265
million of net lease receivables, including $179 million of securitized
receivables.
CREDIT INSURANCE AND CREDIT PROTECTION
Through unaffiliated insurance carriers, Advanta offers credit life,
disability and unemployment insurance to its credit cardholders and credit life
insurance and a limited life/disability/unemployment insurance product to its
mortgage loan customers. The unaffiliated insurers reinsure 100% of the risk on
the credit card credit and limited mortgage life, disability and unemployment
insurance (but not the mortgage loan credit life insurance) with one or more of
Advanta's insurance subsidiaries. Such subsidiaries receive reinsurance premiums
approximating 94% of the net premiums written. The subsidiaries are obligated to
pay all losses and refunds, and have amounts withheld by the insurance carriers
or maintain amounts in separate trust accounts for the benefit of these
insurance carriers in an amount equal to statutory reserves as defined by the
reinsurance agreements. In addition, in 1992, one of the insurance subsidiaries
began direct underwriting of an indemnity policy protecting certain interests in
the business equipment leased to customers of ABS against sudden and accidental
loss.
ADVANTA CAPITAL L.L.C.
Advanta Capital L.L.C. is a limited life special purpose finance subsidiary
of Advanta organized in May 1995 as a limited liability company under the laws
of the State of Delaware. All of Advanta Capital's common limited liability
company interests are directly or indirectly beneficially owned by Advanta and
are non-transferable. Advanta Capital has no board of directors or officers, and
all of its business and affairs are conducted by Advanta, as the manager (the
"Manager") appointed in Advanta Capital's Limited Liability Company Agreement.
Advanta Capital exists solely for the purpose of issuing its common and
preferred limited liability company interests and lending the proceeds thereof
to Advanta to finance Advanta's or its subsidiaries' business operations. The
principal office of Advanta Capital is 501 Carr Road, Wilmington, Delaware
19809.
CERTAIN RATIOS
The following table sets forth the ratio of earnings to fixed charges of
Advanta and its subsidiaries and the ratio of earnings to combined fixed charges
and preferred stock dividends of Advanta and its subsidiaries for the periods
indicated:
<TABLE>
<CAPTION>
THREE
MONTHS
ENDED
MARCH 31, YEAR ENDED DECEMBER 31,
----------- --------------------------------
1995 1994 1994 1993 1992 1991 1990
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges................ 2.26 2.85 2.71 2.52 1.81 1.36 1.20
Ratio of Earnings to Combined Fixed Charges and
Preferred Stock Dividends....................... 2.25 2.83 2.71 2.52 1.81 1.35 1.20
</TABLE>
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<PAGE> 9
REGULATION
ADVANTA
Advanta owns Colonial National, which is a "bank" as defined under the Bank
Holding Company Act of 1956, as amended (the "BHCA"), as further amended by the
Competitive Equality Banking Act of 1987 ("CEBA"). However, under certain
grandfathering provisions of CEBA, Advanta is not required to register as a bank
holding company under the BHCA, because Colonial National, which takes demand
deposits but does not make commercial loans, did not come within the BHCA's
definition of the term "bank" prior to the enactment of CEBA and it complies
with certain restrictions set forth in CEBA, such as limiting its activities to
those in which it was engaged prior to March 5, 1987 and limiting its growth
rate to not more than 7% per annum. Such restrictions also prohibit Colonial
National from cross-marketing products or services of an affiliate that are not
permissible for bank holding companies under the BHCA. In addition, Advanta
complies with certain other restrictions set forth in CEBA, such as not
acquiring control of more than 5% of the stock or assets of an additional "bank"
or "savings association" as defined for these purposes under the BHCA.
Consequently, Advanta is not subject to examination by the Federal Reserve Board
(other than for purposes of assuring continued compliance with the CEBA
restrictions referenced in this paragraph). Should Advanta or Colonial National
cease to comply with the restrictions set forth in CEBA, registration as a bank
holding company under the BHCA would be required.
Registration as a bank holding company is not automatic. The Federal
Reserve Board may deny an application if it determines that control of a bank by
a particular company will cause undue interference with competition or that such
company lacks the financial or managerial resources to serve as a source of
strength to its subsidiary bank. While Advanta believes that it meets the
Federal Reserve Board's managerial standards and that its ownership of Colonial
National has improved the bank's competitiveness, should Advanta be required to
apply to become a bank holding company the outcome of any such application
cannot be certain.
Registration as a bank holding company would subject Advanta and its
subsidiaries to inspection and regulation by the Federal Reserve Board. Although
Advanta has no plans to register as a bank holding company at this time, Advanta
believes that registration would not restrict, curtail, or eliminate any of its
activities at current levels, except that some portions of the current business
operations of Advanta's insurance subsidiaries would have to be discontinued,
the effects of which would not be material.
COLONIAL NATIONAL
Advanta conducts substantially all of its deposit-taking activities and
credit card lending business, as well as a large portion of its mortgage lending
business, through Colonial National. Under federal law, Colonial National may
"export" (i.e., charge its customers resident in other states) the finance
charges permissible under the law of its state of domicile, Delaware, which has
no usury statute applicable to banks. Nevertheless, certain jurisdictions may
attempt to require out-of-state credit card issuers and consumer lenders to
comply with such jurisdictions' consumer protection laws (including laws
limiting the fees and charges imposed by such credit card issuers and consumer
lenders) in connection with their operations in such jurisdictions. A successful
challenge by such a jurisdiction could have an adverse impact on Colonial
National's credit card and other consumer lending operations.
Colonial National is subject to regulation and periodic examination
primarily by the Office of the Comptroller of the Currency (the "Comptroller").
Such regulation relates to the maintenance of reserves for certain types of
deposits, the maintenance of certain financial ratios, transactions with
affiliates and a broad range of other banking practices. As a national bank,
Colonial National is subject to provisions of federal law which restrict its
ability to extend credit to its affiliates or pay dividends to its parent
company. See "Dividends and Transfers of Funds."
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<PAGE> 10
Colonial National is subject to capital adequacy guidelines approved by the
Comptroller. These guidelines make regulatory capital requirements more
sensitive to differences in risk profiles among banking organizations and
consider off-balance sheet exposures in determining capital adequacy. As of
December 31, 1994, the minimum required ratio of total capital to risk-weighted
assets (including certain off-balance sheet items) was 8%. At least half of the
total capital is to be comprised of common equity, retained earnings and a
limited amount of non-cumulative perpetual preferred stock ("Tier 1 capital").
The remainder may consist of other preferred stock, certain hybrid debt/equity
instruments, a limited amount of term subordinated debt or a limited amount of
the reserve for possible credit losses ("Tier 2 capital"). In addition, the
Comptroller has adopted a minimum leverage ratio (Tier 1 capital divided by
total average assets) of 3% for national banks that meet certain specified
criteria, including the requirement that they have the highest regulatory
rating. Under this guideline, the minimum leverage ratio would be at least 1 or
2 percentage points higher for national banks that do not have the highest
regulatory rating, for national banks undertaking major expansion programs, and
for other national banks in certain circumstances. As of December 31, 1994,
Colonial National's Tier 1 capital ratio was 7.95%. The combined Tier 1 and Tier
2 capital ratio was 12.04%, and the leverage ratio was 8.15%.
The Comptroller of the Currency and the other federal banking regulators
have proposed for comment regulations establishing new risk-based requirements
for recourse arrangements and direct credit substitutes. The effect of these
regulations may be to increase the cost of credit enhancement provided by banks
in connection with the securitization of credit card and other consumer
receivables. Also, the Comptroller has proposed regulations that would add an
additional risk-based capital requirement based upon the amount of an
institution's exposure to interest rate risk. In addition, bank regulators have
the ability to raise capital requirements applicable to banking organizations
beyond current levels. However, Advanta is unable to predict whether and when
higher capital requirements may be imposed.
Pursuant to certain provisions of the FDIC Improvement Act of 1991
("FDICIA") and regulations promulgated thereunder, FDIC insured institutions
such as Colonial National may accept brokered deposits without FDIC permission
only if they meet certain capital standards, and are subject to restrictions
with respect to the interest they may pay on deposits unless they are
"well-capitalized." To be "well-capitalized," a bank must have a ratio of total
capital to risk-weighted assets of not less than 10%, Tier 1 capital to
risk-weighted assets of not less than 6%, and a Tier 1 leverage ratio of not
less than 5%. Based on the applicable standards under these regulations,
Colonial National is currently "well-capitalized," and Advanta intends to
maintain Colonial National as a "well-capitalized" institution.
OTHER FDIC-INSURED DEPOSITORY INSTITUTIONS
In January 1992, Advanta Financial Corp. ("AFC") opened for business and
began taking deposits. AFC is an FDIC-insured industrial loan corporation
organized under the laws of the State of Utah and is subject to examination and
regulation by both the FDIC and the Utah Department of Financial Institutions.
At December 31, 1994, AFC had deposits of $33 million and total assets of $49
million. Currently, AFC's principal activity consists of small ticket equipment
lease financing. AFC is also the issuer of the small business credit cards
marketed by ABS.
Pursuant to certain provisions of the Financial Institutions Reform,
Recovery, and Enforcement Act of 1989, an insured depository institution which
is commonly controlled with another insured depository institution is generally
liable for any loss incurred, or reasonably anticipated to be incurred, by the
FDIC in connection with the default of such commonly controlled institution, or
any assistance provided by the FDIC to such commonly controlled institution,
which is in danger of default. The term "default" is defined to mean the
appointment of a conservator or receiver for such institution and "in danger of
default" is defined generally as the existence of certain conditions indicating
that "default" is likely to occur in the absence of regulatory assistance. Thus,
each of Colonial National, AFC, and ANB could incur liability to the FDIC
pursuant to this statutory provision in the event of the default of one
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<PAGE> 11
of the others. Such liability is subordinated in right of payment to deposit
liabilities, secured obligations, any other general or senior liabilities and
any obligation subordinate in depositors or other general creditors other than
obligations owed to any affiliate of the depository institution (with certain
exceptions) and any obligations to shareholders in such capacity.
LENDING AND LEASING ACTIVITIES
Advanta's activities as a lender are also subject to regulation under
various federal and state laws including the Truth-in-Lending Act, the Equal
Credit Opportunity Act, the Home Mortgage Disclosure Act, the Community
Reinvestment Act, the Electronic Funds Transfer Act, and the Fair Credit
Reporting Act. Provisions of those statutes and related regulations, among other
matters, require disclosure to borrowers of finance charges in terms of an
annual percentage rate, prohibit certain discriminatory practices in extending
credit, require Advanta's FDIC-insured depository institutions to serve the
banking needs of their local communities, and regulate the dissemination and use
of information relating to a borrower's creditworthiness. Certain of these
statutes and regulations also apply to Advanta's leasing activities. In
addition, Advanta Mortgage and its subsidiaries are subject to licensure and
regulation in various states as mortgage bankers, mortgage brokers, and
originators, sellers and servicers of mortgage loans.
DIVIDENDS AND TRANSFERS OF FUNDS
There are various legal limitations on the extent to which Colonial
National, AFC or ANB can finance or otherwise supply funds through dividends,
loans or otherwise to Advanta and its affiliates. The prior approval of the
Comptroller is required if the total of all dividends declared by Colonial
National in any calendar year exceeds its net profits (as defined for such
purposes) for that year combined with its retained net profits for the preceding
two years, less any required transfers to surplus accounts. In addition,
Colonial National may not pay a dividend in an amount greater than its undivided
profits then on hand after deducting its losses and bad debts. The Comptroller
also has authority under the Financial Institutions Supervisory Act to prohibit
a national bank from engaging in any unsafe or unsound practice in conducting
its business. It is possible, depending upon the financial condition of the bank
in question and other factors, that the Comptroller could claim that a dividend
payment might under some circumstances be an unsafe or unsound practice. All of
these restrictions also apply to ANB.
Colonial National, AFC and ANB are also subject to restrictions under
Sections 23A and 23B of the Federal Reserve Act. These restrictions limit the
transfer of funds by each of the depository institutions to Advanta and certain
other affiliates, as defined in that Act, in the form of loans, extensions of
credit, investments or purchases of assets, and they require generally that each
such depository institution's transactions with its affiliates be on terms no
less favorable to the depository institution than comparable transactions with
unrelated third parties. These transfers by any one depository institution to
Advanta or any single affiliate are limited in amount to 10% of the depository
institution's capital and surplus, and transfers to all affiliates are limited
in the aggregate to 20% of the depository institution's capital and surplus.
Furthermore, such loans and extensions of credit are also subject to various
collateral requirements. In addition, in order for Advanta to maintain its
grandfathered exemption under CEBA, neither Colonial National nor ANB may make
any loans to Advanta or any of its subsidiaries.
Advanta's insurance subsidiaries are insurance companies organized under
and regulated by Arizona law. Arizona insurance regulations restrict the amount
of dividends which an insurance company may distribute without the prior consent
of the Director of Insurance.
GENERAL
Because the banking and finance businesses in general are the subject of
such extensive regulation at both the state and federal levels, and because
numerous legislative and regulatory proposals are
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<PAGE> 12
advanced each year which, if adopted, could affect Advanta's profitability or
the manner in which Advanta conducts its activities, Advanta cannot now predict
the extent of the impact of any such new laws or regulations.
Various legislative proposals have been introduced in Congress in recent
years, including, among others, proposals relating to imposing a statutory cap
on credit card interest rates, permitting affiliations between banks and
commercial or securities firms, proposals placing new restrictions on a lender's
ability to utilize prescreening of consumers' credit reports through credit
reporting agencies (credit bureaus) in connection with the lender's direct
marketing efforts and proposals eliminating the 7% per annum limit on the growth
rate applicable to grandfathered CEBA "nonbank" banks, such as Colonial
National. It is impossible to determine whether any of these proposals will
become law and, if so, what impact they will have on Advanta.
In September 1992, the Federal Communications Commission established rules
implementing the Telephone Consumer Protective Act of 1991 which limits
telephone solicitations to residences. Because the statute exempts telemarketing
to existing or former customers, it does not materially impact Advanta's current
business operations. These rules could, however, impair Advanta's ability to
generate new business or expand its customer base through telephone
solicitation.
In 1994, Congress adopted the Interstate Banking and Branching Efficiency
Act, which permits nationwide interstate bank acquisitions beginning in 1995,
and interstate bank branching in 1997 (or earlier at a state's option). Advanta
does not currently believe that the changes in the country's banking system
brought about by this statute will materially impact Advanta's business.
USE OF PROCEEDS
Unless otherwise provided in the applicable Prospectus Supplement, the net
proceeds from the sale of the Securities will be used: (i) by Advanta, for
general corporate purposes, including the purchase of assets from, investments
in and extensions of credit to, subsidiaries and affiliates of Advanta which
will use the proceeds for general corporate purposes; and, possibly, for
financing future acquisitions by Advanta, including without limitation,
acquisitions of credit card, mortgage and equipment lease portfolios; and (ii)
by Advanta Capital, for loans to Advanta for the purposes described above. At
the date hereof, no specific proposed acquisitions have been identified as
probable. The amount of Securities offered from time to time pursuant to this
Prospectus and the precise amounts and timing of the application of proceeds
will depend upon funding requirements of Advanta and its subsidiaries and
affiliates. If Advanta elects at the time of issuance of Securities to make
different or more specific use of proceeds other than as set forth herein, such
use will be described in the applicable Prospectus Supplement.
In view of its anticipated requirements, Advanta expects to engage, on a
recurring basis, in additional private or public financings of a character and
amount to be determined as the need arises.
DESCRIPTION OF DEBT SECURITIES OF ADVANTA
The Debt Securities are to be issued in one or more series under either (i)
a senior indenture (the "Senior Indenture"), a copy of which is filed as an
exhibit to the Registration Statement, or (ii) a subordinated indenture (the
"Subordinated Indenture"), a copy of which is filed as an exhibit to the
Registration Statement. The following summaries of certain provisions of the
Senior Indenture and the Subordinated Indenture (collectively, the "Indentures")
do not purport to be complete and are subject to, and qualified in their
entirety by reference to, all provisions of the Indentures, including the
definitions therein of certain terms. Wherever particular Sections or defined
terms of the Indentures are referred to herein or in a Prospectus Supplement, it
is intended that such Sections or
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<PAGE> 13
defined terms (including, unless otherwise indicated herein, definitions of
terms capitalized in these summaries) shall be incorporated herein or therein by
reference. The following sets forth certain general terms and provisions of the
Debt Securities to which any Prospectus Supplement may relate. The particular
terms of the Debt Securities offered by any Prospectus Supplement and the
extent, if any, to which such general provisions may apply to the Debt
Securities so offered, will be described in the Prospectus Supplement relating
to such Debt Securities.
Advanta's rights and the rights of its creditors, including the holders of
the Debt Securities offered hereby, to participate in the assets of any
subsidiary upon the latter's liquidation or recapitalization will be subject to
the prior claims of the subsidiary's creditors except to the extent that Advanta
may itself be a creditor with recognized claims against the subsidiary.
GENERAL
The Indentures do not limit the aggregate principal amount of Debt
Securities which may be issued thereunder and provide that Debt Securities may
be issued from time to time in one or more series. The Debt Securities will be
direct unsecured obligations of Advanta. Neither the Indentures nor the Debt
Securities will limit or otherwise restrict the amount of other indebtedness
which may be incurred or other securities which may be issued by Advanta or any
of its subsidiaries. The Debt Securities issued under the Senior Indenture will
rank on a parity with all other unsecured unsubordinated indebtedness of
Advanta. The Debt Securities issued under the Subordinated Indenture will be
subordinate and junior in right of payment to all Senior Indebtedness of
Advanta, to the extent and in the manner set forth in the Subordinated
Indenture. See "Special Terms Relating to Subordinated Debt Securities".
Reference is made to the Prospectus Supplement relating to the particular
series of Debt Securities offered thereby for the following terms: (1) the title
and series of such Debt Securities; (2) any limit on the aggregate principal
amount of such Debt Securities; (3) the price or prices (expressed as a
percentage of the aggregate principal amount thereof) at which such Debt
Securities will be issued; (4) the date or dates on which such Debt Securities
will mature, or the method or methods, if any, by which such date or dates shall
be determined; (5) the rate or rates (which may be fixed or variable) per annum
at which such Debt Securities will bear interest, if any, or the method or
methods, if any, by which such rate or rates are to be determined; (6) the date
or dates from which such interest, if any, on such Debt Securities will accrue
or the method or methods, if any, by which such date or dates are to be
determined, the dates on which such interest, if any, will be payable, the date
on which payment of such interest, if any, will commence and the Regular Record
Dates for such Interest Payment Dates, if any; (7) the dates, if any, on which
and the price or prices at which the Debt Securities will, pursuant to any
mandatory sinking fund provisions, or may, pursuant to any optional sinking fund
or purchase fund provisions, be redeemed by Advanta, and the other detailed
terms and provisions of such sinking and/or purchase funds; (8) the date, if
any, after which and the price or prices at which the Debt Securities may,
pursuant to any optional redemption provisions, be redeemed at the option of
Advanta or of the holder thereof and the other detailed terms and provisions of
such optional redemption; (9) the extent to which any of the Debt Securities
will be issuable in temporary or permanent global form and, if so, the identity
of the depositary for such global Debt Security, or the manner in which any
interest payable on a temporary or permanent global Debt Security will be paid;
(10) the denomination or denominations in which such Debt Securities are
authorized to be issued; (11) whether any of the Debt Securities will be issued
in bearer form and, if so, any limitations on issuance or conversion of such
bearer Debt Securities (including exchange for registered Debt Securities of the
same series); (12) information with respect to book-entry procedures; (13)
whether any of the Debt Securities will be issued as Original Issue Discount
Securities; (14) each office or agency where, subject to the terms of the
Indenture, such Debt Securities may be presented for registration of transfer or
exchange; (15) the currencies or currency units in which such Debt Securities
are issued and in which the principal of, interest on and additional amounts, if
any, in respect of such Debt Securities will be payable; (16) whether the amount
of payments of principal of,
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<PAGE> 14
and interest and additional amounts, if any, on such Debt Securities may be
determined with reference to an index, formula or other method (which index,
formula or method may, but need not be, based on one or more currencies,
currency units or composite currencies, commodities, equity indices or other
indices) and the manner in which such amounts shall be determined; (17) whether
Advanta or a holder may elect payment of the principal of or interest on such
Debt Securities in a currency, currencies, currency unit or units or composite
currency or currencies other than that in which such Debt Securities are
denominated or stated to be payable, the period or periods within which, and the
terms and conditions upon which, such election may be made, and the time and
manner of determining the exchange rate between the currency, currencies,
currency unit or units, or composite currency or currencies in which such Debt
Securities are denominated or stated to be payable and the currency, currencies,
currency unit or units or composite currency or currencies in which such Debt
Securities are to be so payable; (18) the identity of the Trustee, and if other
than the applicable Trustee, the identity of each Security Registrar, Paying
Agent and Authenticating Agent and the designation of the initial Exchange Rate
Agent; (19) if applicable, the defeasance of certain obligations by Advanta
pertaining to Debt Securities of the series; (20) the person to whom any
interest on any registered Debt Security of the series shall be payable, if
other than the person in whose name that Debt Security (or one or more
predecessor Debt Securities) is registered at the close of business on the
Regular Record Date for such interest, the manner in which, or the person to
whom, any interest on any bearer Debt Security of the series shall be payable,
if otherwise than upon presentation and surrender of the coupons appertaining
thereto as they severally mature, and the extent to which, or the manner in
which, any interest payable on a temporary global Debt Security on an Interest
Payment Date will be paid if other than in the manner provided in the Indenture;
(21) whether and under what circumstances Advanta will pay additional amounts as
contemplated by Section 1004 of the Indenture (the term "interest," as used in
this Prospectus, shall include such additional amounts) on such Debt Securities
to any holder who is not a United States person (including any modification to
the definition of such term as contained in the Indenture as originally
executed) in respect of any tax, assessment or governmental charge and, if so,
whether Advanta will have the option to redeem such Debt Securities rather than
pay such additional amounts (and the terms of any such option); (22) any
deletions from, modifications of or additions to the Events of Default or
covenants of Advanta with respect to any of such Debt Securities; (23) whether
such Debt Securities shall be convertible or exchangeable for Capital Securities
or other Debt Securities and, if so, the terms of any such conversion or
exchange and the terms of such other Securities; and (24) any other terms of the
series (which will not be inconsistent with the provisions of the applicable
Indenture).
Debt Securities may be issued as Original Issue Discount Securities to be
sold at a substantial discount below their principal amount. In the event of an
acceleration of the maturity of any Original Issue Discount Security, the amount
payable to the holder of such Original Issue Discount Security upon such
acceleration will be determined in accordance with the applicable Prospectus
Supplement, the terms of such Debt Security and the applicable Indenture, but
will be an amount less than the amount payable at the maturity of such Original
Issue Discount Security. Special federal income tax and other considerations
applicable thereto will be described in the Prospectus Supplement relating
thereto.
Debt Securities may also be issued under the Indentures upon exercise of
Debt Warrants. See "Description of Securities Warrants of Advanta."
The provisions of the Indentures described below under "Restrictive
Covenants" are the only provisions which would afford holders of Debt Securities
protection in the event of a highly leveraged transaction involving Advanta.
REGISTRATION, TRANSFER, PAYMENT AND PAYING AGENT
Unless otherwise indicated in the applicable Prospectus Supplement, each
series of Debt Securities will be issued in registered form only, without
coupons. The Indentures, however, provide that Advanta may also issue Debt
Securities in bearer form only, or in both registered and bearer form.
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<PAGE> 15
Debt Securities issued in bearer form shall have interest coupons attached,
unless issued as Original Issue Discount Securities. Debt Securities in bearer
form shall not be offered, sold, resold or delivered in connection with their
original issuance in the United States or to any United States person (as
defined below) other than through offices located outside the United States of
certain United States financial institutions. As used herein, "United States
person" means any citizen or resident of the United States, any corporation,
partnership or other entity created or organized in or under the laws of the
United States, or any estate or trust, the income of which is subject to United
States federal income taxation regardless of its source, and "United States"
means the United States of America (including the States and the District of
Columbia), its territories, its possessions and other areas subject to its
jurisdiction. Purchasers of Debt Securities in bearer form will be subject to
certification procedures and may be affected by certain limitations under United
States tax laws. Such procedures and limitations will be described in the
Prospectus Supplement relating to the offering of the Debt Securities in bearer
form.
Unless otherwise indicated in the applicable Prospectus Supplement, Debt
Securities will be issued in denominations of $1,000 or any integral multiple
thereof. No service charge will be made for any transfer, exchange or conversion
of the Debt Securities but Advanta may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
Unless otherwise described in the Prospectus Supplement relating thereto,
the principal, premium, if any, and interest, if any, of or on the Debt
Securities will be payable, transfer of the Debt Securities will be registrable,
and, if applicable, any Convertible Debt Securities (as hereinafter defined)
will be convertible, at the office or agency of Advanta maintained for that
purpose, as Advanta may designate from time to time, in The City of New York,
New York, provided that payments of interest may be made at the option of
Advanta by check mailed to the address appearing in the Security Register of the
person in whose name such registered Debt Security is registered at the close of
business on the Regular Record Date (Sections 305 and 307 of each Indenture).
Unless otherwise indicated in the applicable Prospectus Supplement, payment
of principal of, premium, if any, and interest, if any, on Debt Securities in
bearer form will be made payable, subject to any applicable laws and
regulations, at such office outside the United States as specified in the
Prospectus Supplement and as Advanta may designate from time to time, at the
option of the holder, by check or by transfer to an account maintained by the
payee with a bank located outside the United States. Unless otherwise indicated
in the applicable Prospectus Supplement, payment of interest and certain
additional amounts on Debt Securities in bearer form will be made only against
surrender of the coupon relating to such Interest Payment Date. No payment with
respect to any Debt Security in bearer form will be made at any office or agency
of Advanta in the United States or by check mailed to any address in the United
States or by transfer to an account maintained with a bank located in the United
States.
GLOBAL DEBT SECURITIES
The Debt Securities of a series may be issued in whole or in part in the
form of one or more global securities ("Global Debt Securities") that will be
deposited with, or on behalf of, a depositary (the "Depositary") identified in
the Prospectus Supplement relating to such series. Global Debt Securities may be
issued in either registered or bearer form and in either temporary or permanent
form. Unless and until it is exchanged in whole or in part for individual
certificates evidencing Debt Securities in definitive form represented thereby,
a Global Debt Security may not be transferred except as a whole by the
Depositary for such Global Debt Security to a nominee of such Depositary or by a
nominee of such Depositary to such Depositary or another nominee of such
Depositary or by such Depositary or any such nominee to a successor of such
Depositary or a nominee of such successor.
The specific terms of the depositary arrangement with respect to a series
of Global Debt Securities and certain limitations and restrictions relating to a
series of bearer Global Debt Securities, will be described in the Prospectus
Supplement relating to such series.
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RESTRICTIVE COVENANTS
Each of the Indentures contains a covenant by Advanta limiting its ability
to dispose of the Voting Stock of a Significant Subsidiary. A "Significant
Subsidiary" is defined to mean any Subsidiary of Advanta the Consolidated Assets
of which constitute 20% or more of Advanta's Consolidated Assets. Such covenant
provides that, subject to certain exceptions, so long as any of the Debt
Securities are outstanding, Advanta: (a) will not, nor will it permit any
Subsidiary to, sell, assign, transfer or otherwise dispose of any shares of, or
securities convertible into, or options, warrants or rights to subscribe for or
purchase shares of, Voting Stock of a Significant Subsidiary, nor will Advanta
permit a Significant Subsidiary to issue any shares of, or securities
convertible into, or options, warrants or rights to subscribe for or purchase
shares of, Voting Stock of a Significant Subsidiary, unless Advanta will own,
directly or indirectly, at least 80% of the issued and outstanding Voting Stock
of such Subsidiary after giving effect to such transaction; and (b) will not
permit a Significant Subsidiary to either (i) merge or consolidate with or into
any corporation (other than Advanta), unless at least 80% of the surviving
corporation's Voting Stock is, or upon consummation of the merger or
consolidation will be, owned, directly or indirectly, by Advanta, or (ii) lease,
sell or transfer all or substantially all of its properties or assets to any
corporation or other person (other than Advanta), unless 80% of the Voting Stock
of such corporation or other person is owned, or will be owned, upon such lease,
sale or transfer, directly or indirectly, by Advanta (Section 1005 of each
Indenture).
In addition, each of the Indentures contains a covenant prohibiting Advanta
from creating or permitting, or permitting any Subsidiary to create or permit,
any liens upon 20% or more of the Voting Stock of any Significant Subsidiary to
secure any indebtedness without securing the Debt Securities equally and ratably
with all indebtedness secured thereby (Section 1006 of each Indenture).
OUTSTANDING DEBT SECURITIES
In determining whether the holders of the requisite principal amount of
Outstanding Debt Securities have given any request, demand, authorization,
direction, notice, consent or waiver under the Indenture, (i) the portion of the
principal amount of an Original Issue Discount Security that shall be deemed to
be Outstanding for such purposes shall be that portion of the principal amount
thereof that could be declared to be due and payable pursuant to the terms of
such Original Issue Discount Security as of the date of such determination, (ii)
the principal amount of any Indexed Security shall be the principal face amount
of such Indexed Security determined on the date of its original issuance and
(iii) any Debt Security owned by Advanta or any obligor on such Debt Security or
any Affiliate of Advanta or such other obligor, shall be deemed not to be
Outstanding (Section 101 of each Indenture).
MODIFICATION AND WAIVER
Modifications and amendments of each of the Indentures may be made by
Advanta and the applicable Trustee with the consent of the holders of 66 2/3% in
aggregate principal amount of the Outstanding Debt Securities of each series
affected by such modification or amendment; provided, however, that no such
modification or amendment may, without the consent of the holder of each
Outstanding Debt Security affected thereby: (a) change the stated maturity date
of the principal of, or any installment of principal or interest on, any Debt
Security; (b) reduce the principal amount of, or any premium or interest on, any
Debt Security; (c) reduce the amount of principal of an Original Issue Discount
Security payable upon acceleration of the maturity thereof or the amount thereof
provable in bankruptcy; (d) adversely affect the right of repayment at the
option of any holder; (e) change the place of payment of, currency of payment of
principal of, or any premium or interest on, any Debt Security; (f) impair the
right to institute suit for the enforcement of any payment on or with respect to
any Debt Security; (g) reduce the percentage in principal amount of Outstanding
Debt Securities of any series the consent of whose holders is required for
modification or amendment of the Indenture or for waiver of compliance with
certain provisions of the applicable Indenture or for waiver of certain
defaults; (h) in the case of Convertible Debt Securities, adversely affect the
right to convert any such
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Debt Security; or (i) in the case of the Subordinated Indenture, adversely
change the subordination provisions thereof (Section 902 of each Indenture).
The holders of a majority in aggregate principal amount of the Outstanding
Debt Securities of each series may, on behalf of all holders of Debt Securities
of that series, waive, insofar as that series is concerned, compliance by
Advanta with certain restrictive provisions of the applicable Indenture (Section
1008 of each Indenture). The holders of a majority in aggregate principal amount
of the Outstanding Debt Securities of each series may, on behalf of all holders
of Debt Securities of that series, waive any past default under the applicable
Indenture with respect to Debt Securities of that series, except a default in
the payment of principal or any premium or interest, or a default in respect of
a provision which under the Indenture cannot be modified or amended without the
consent of the holder of each affected Outstanding Debt Security of that series
(Section 513 of each Indenture).
Modification and amendment of each of the Indentures may be made by Advanta
and the applicable Trustee without the consent of any holder for any of the
following purposes: (i) to evidence the succession of another corporation to
Advanta; (ii) to add to the covenants of Advanta for the benefit of the holders
of all or any series of Debt Securities; (iii) to add Events of Default; (iv) to
add or change any provisions of the Indenture to facilitate the issuance of
bearer Debt Securities; (v) to add to, delete from or revise the conditions,
limitations and restrictions on the authorized amount, terms or purposes of
issue, authentication and delivery of Debt Securities; (vi) to establish the
form or terms of Debt Securities of any series and any related coupons; (vii) to
provide for the acceptance of appointment by a successor Trustee; (viii) to cure
any ambiguity, defect or inconsistency in the Indenture, provided such action
does not adversely affect the interests of holders of Debt Securities of any
series or any related coupons in any material respect; (ix) to supplement any of
the provisions of the Indenture to such extent as shall be necessary to permit
or facilitate the defeasance and discharge of any series of Debt Securities,
provided such action does not adversely affect the interests of holders of Debt
Securities of such series or any related coupons in any material respect; (x) to
secure the Debt Securities; and (xi) to amend or supplement any provision
contained in the Indenture or in any supplemental indenture, provided that such
amendment or supplement does not materially adversely affect the interests of
the holders of any Debt Securities then Outstanding (Section 901 of each
Indenture).
CONSOLIDATION, MERGER AND SALE OF ASSETS
Advanta may consolidate or merge with or into, or transfer its assets
substantially as an entirety to, any corporation organized under the laws of any
domestic jurisdiction, provided that the successor corporation assumes Advanta's
obligations on the Debt Securities and under each of the Indentures, that after
giving effect to the transaction no Event of Default, and no event which, after
notice or lapse of time, would become an Event of Default, shall have occurred
and be continuing, and that certain other conditions are met (Section 801 of
each Indenture).
EVENTS OF DEFAULT AND CERTAIN RIGHTS ON DEFAULT
The following are Events of Default under each of the Indentures with
respect to Debt Securities of any series: (a) failure to pay principal of or any
premium on any Debt Security of that series when due; (b) failure to pay any
interest on any Debt Security of that series when due, continued for 30 days;
(c) failure to deposit any sinking fund payment, when due, in respect of any
Debt Security of that series; (d) breach of any other covenant or warranty of
Advanta in the applicable Indenture (other than a covenant or warranty included
in such Indenture solely for the benefit of a series of Debt Securities other
than that series), continued for 60 days after written notice as provided in the
applicable Indenture; (e) certain events in bankruptcy, insolvency or
reorganization involving Advanta or any Significant Subsidiary; (f) acceleration
of indebtedness in a principal amount in excess of $10,000,000 for money
borrowed by Advanta or any Significant Subsidiary under the terms of the
instrument under which such indebtedness was issued or secured, if such
acceleration is not annulled within 30 days after written notice as provided in
the applicable Indenture; and (g) any other Event of
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Default provided with respect to Debt Securities of that series (Section 501 of
each Indenture). If an Event of Default with respect to Debt Securities of any
series at the time Outstanding occurs and is continuing, either the applicable
Trustee or the holders of at least 25% in aggregate principal amount of the
Outstanding Debt Securities of that series may declare the principal amount of
all the Debt Securities of that series to be due and payable immediately. At any
time after a declaration of acceleration with respect to Debt Securities of any
series has been made, but before a judgment or decree based on acceleration has
been obtained, the holders of a majority in aggregate principal amount of
Outstanding Senior Debt Securities of that series may rescind and annul such
acceleration, provided that, among other things, all Events of Default with
respect to such series, other than payment defaults caused by such acceleration,
have been cured or waived as provided in the applicable Indenture (Section 502
of each Indenture).
ADDITIONAL PROVISIONS
Each Indenture provides that, subject to the duty of the applicable Trustee
during default to act with the required standard of care, the Trustee will be
under no obligation to exercise any of its rights or powers under the Indenture
at the request or direction of any of the holders, unless such holders shall
have offered to the Trustee reasonable indemnity (Section 601 of each
Indenture). Subject to such provisions for the indemnification of the Trustee
and certain other conditions, the holders of a majority in aggregate principal
amount of the Outstanding Debt Securities of any series will have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred on the
Trustee, with respect to the Debt Securities of that series (Section 512 of each
Indenture).
No holder of any Debt Security of any series will have any right to
institute any proceeding with respect to the applicable Indenture or for any
remedy thereunder, unless: (i) such holder shall have previously given to the
applicable Trustee written notice of a continuing Event of Default with respect
to Debt Securities of that series; (ii) the holders of not less than 25% in
aggregate principal amount of the Outstanding Debt Securities of that series
shall have made written request, and offered reasonable indemnity, to the
applicable Trustee to institute such proceeding as trustee; (iii) the Trustee
shall have failed to institute such proceeding within 60 days after receipt of
such written request; and (iv) the Trustee shall not have received from the
holders of a majority in principal amount of the Outstanding Debt Securities of
that series a direction inconsistent with such request (Section 507 of each
Indenture). However, the holder of any Debt Security will have an absolute right
to receive payment of the principal of (and premium, if any) and interest on
such Debt Security on or after the due dates expressed in such Debt Security and
to convert any Debt Security which is a Convertible Debt Security (as
hereinafter defined), and to institute suit for the enforcement of any such
rights to payment or conversion (Section 508 of each Indenture).
Advanta is required to furnish to each Trustee annually a statement as to
performance by Advanta of certain of its obligations under the applicable
Indenture and as to any default in such performance. Advanta is also required to
deliver to each Trustee, within five days after the occurrence thereof, written
notice of any event which after notice or lapse of time or both would constitute
an Event of Default (Section 1009 of each Indenture).
SPECIAL TERMS RELATING TO SUBORDINATED DEBT SECURITIES
Upon any distribution of assets of Advanta resulting from any dissolution,
winding up, liquidation or reorganization, payments on Subordinated Debt
Securities are to be subordinated, to the extent provided in the Subordinated
Indenture, in right of payment to the prior payment in full of all Senior
Indebtedness, but the obligation of Advanta to make payments on the Subordinated
Debt Securities will not otherwise be affected. No payment on Subordinated Debt
Securities may be made at any time when there is a default in the payment of any
principal, premium, interest, Additional Amounts or sinking fund of or on any
Senior Indebtedness. Holders of Subordinated Debt Securities will be subrogated
to the rights of holders of Senior Indebtedness to the extent of payments made
on Senior
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Indebtedness upon any distribution of assets in any such proceedings out of the
distributive shares of Subordinated Debt Securities. By reason of such
subordination, in the event of a distribution of assets upon insolvency, certain
creditors of Advanta may recover more, ratably, than holders of Subordinated
Debt Securities (Article Sixteen of the Subordinated Indenture).
Senior Indebtedness is defined in the Subordinated Indenture as the
principal of, premium, if any, and unpaid interest on (a) indebtedness of
Advanta (including indebtedness of others guaranteed by Advanta), other than the
Subordinated Debt Securities, whether outstanding on the date of execution of
the Subordinated Indenture or thereafter created, incurred, assumed or
guaranteed, (i) for money owing to banks, (ii) for money borrowed from sources
other than banks, or (iii) in connection with the acquisition by Advanta or a
subsidiary of assets of any kind except in the ordinary course of business,
unless in the instrument creating or evidencing the same or pursuant to which
the same is outstanding it is provided that such indebtedness is not superior in
right of payment to the Subordinated Debt Securities; and (b) renewals,
extensions, modifications and refundings of any such indebtedness (Section 101
of the Subordinated Indenture).
CONVERSION
The holders of Debt Securities of a specified series that are convertible
into Capital Securities or other Debt Securities ("Convertible Debt Securities")
will be entitled at certain times specified in the Prospectus Supplement
relating to such Convertible Debt Securities, subject to prior redemption,
exchange, repayment or repurchase, to convert any Convertible Debt Securities of
such series into Capital Securities or other Debt Securities, at the conversion
price set forth in such Prospectus Supplement, subject to adjustment and to such
other terms as are set forth in such Prospectus Supplement.
EXCHANGEABILITY
The holders of Debt Securities of any series may be obligated at any time
or at Maturity to exchange them for Capital Securities or other Debt Securities
of Advanta. The terms of any such exchange and any such Capital Securities or
other Debt Securities will be described in the Prospectus Supplement relating to
such series of Debt Securities. The Class B Common Stock, Class B Preferred
Stock, and Capital Securities of Advanta are described below under "Description
of Class B Common Stock," "Description of Class B Preferred Stock," and
"Issuance of Capital Securities of Advanta upon Conversion or Exchange,"
respectively.
DESCRIPTION OF CLASS B PREFERRED STOCK OF ADVANTA
GENERAL
The Board of Directors has authority to issue 1,000,000 authorized but
unissued shares of Class B Preferred Stock, par value $.01 per share, without
further approval of the stockholders.
Any Class B Preferred Stock offered hereby will be fully paid and
nonassessable. The rights, preferences, privileges and restrictions of the Class
B Preferred Stock in respect of which this Prospectus is delivered shall be
described in an accompanying Prospectus Supplement. Except as otherwise provided
in any Prospectus Supplement, the Class B Preferred Stock offered hereby will
rank on a parity in all respects with the outstanding Class A Preferred Stock of
Advanta. Among the terms of the Class B Preferred Stock which would be specified
in an accompanying Prospectus Supplement are the following: (i) the annual
dividend rate, if any, or the means by which such dividend rate may be
calculated (including without limitation the possibility that the rate of such
dividends may bear an inverse relationship to some index or standard) and the
date or dates from which such dividends shall accrue and the date or dates on
which such dividends shall be paid and whether such dividends shall be
cumulative; (ii) the price at which and the terms and conditions on which the
shares of such series of Preferred Stock may be redeemed, including the period
of time
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during which such shares may be redeemed, any premium to be paid over and above
the par value of such shares of Preferred Stock, whether and to what extent
accumulated dividends on such shares of Preferred Stock will be paid upon the
redemption of such shares; (iii) the liquidation preference, if any, over and
above the par value of such shares of Preferred Stock and whether and to what
extent the holders of such shares of Preferred Stock shall be entitled to
accumulated dividends in the event of the voluntary or involuntary liquidation,
dissolution or winding-up of the affairs of Advanta; (iv) whether the shares of
Class B Preferred Stock shall be subject to the operation of a retirement or
sinking fund and, if so, a description of the operation of such retirement or
sinking fund; (v) the terms and conditions, if any, on which the shares of Class
B Preferred Stock may be convertible into, or exchangeable for, shares of any
other class or classes of stock of Advanta, including the price or rate of
conversion or exchange and the method for effecting such conversion or exchange,
provided that no shares of Class B Preferred Stock will be convertible into
shares of a class that has superior rights or preferences as to dividends or
distribution of assets of Advanta upon the voluntary or involuntary dissolution
or liquidation of Advanta; (vi) a description of the voting rights, if any, of
the shares of Class B Preferred Stock; and (vii) other preferences, rights,
qualifications or restrictions or material terms of such shares of Preferred
Stock.
The description of the foregoing provisions of Class B Preferred Stock as
set forth in the related Prospectus Supplement does not purport to be complete
and is subject to and qualified in its entirety by reference to the definitive
Certificate of Amendment to Advanta's Certificate of Incorporation relating to
such series of Class B Preferred Stock. The definitive Certificate of Amendment
to Advanta's Certificate of Incorporation relating to Class B Preferred Stock
will be filed with the Commission in connection with the offering of Class B
Preferred Stock.
DEPOSITARY SHARES
Advanta may, at its option, elect to offer fractional shares of Class B
Preferred Stock, rather than full shares of Class B Preferred Stock. In the
event such option is exercised, Advanta will issue receipts for Depositary
Shares, each of which will represent a fraction (to be set forth in the
Prospectus Supplement relating to the Class B Preferred Stock) of a share of
such Preferred Stock.
The shares of Class B Preferred Stock represented by Depositary Shares will
be deposited under a Deposit Agreement (the "Deposit Agreement") between Advanta
and a bank or trust company selected by Advanta having its principal office in
the United States and having a combined capital and surplus of at least
$50,000,000 (the "Depositary"). Subject to the terms of the Deposit Agreement,
each owner of a Depositary Share will be entitled, in proportion to the
applicable fraction of a share of Class B Preferred Stock represented by such
Depositary Share, to all the rights and preferences of the Class B Preferred
Stock represented thereby (including dividend, voting, redemption, conversion
and liquidation rights).
The above description of the Depositary Shares is not complete and is
subject to, and qualified in its entirety by, the description in the applicable
Prospectus Supplement and the provisions of the Deposit Agreement (which will
contain the form of Depositary Receipt), a copy of which will be filed with the
Commission as an exhibit to the Registration Statement of which this Prospectus
constitutes a part.
OUTSTANDING PREFERRED STOCK
The authorized capital stock of Advanta includes 1,010 shares of Class A
Preferred Stock, par value $1,000 per share. All of such shares are held by J.R.
Alter, Advanta's founder. The Class A Preferred Stock is entitled to one-half of
a vote per share on all matters on which stockholders are entitled to vote. No
dividends may be declared or paid on Advanta's outstanding common stock unless
and until non-cumulative dividends of $140 per share, payable as and when
declared, which are required to be paid on the Class A Preferred Stock for the
applicable year (a total of $141,400) have been paid. The holder of the Class A
Preferred Stock is not otherwise entitled to participate in the earnings or
profits
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of Advanta. Upon the liquidation of Advanta, the holder of the Class A Preferred
Stock is entitled to receive $1,000 per share ($1,010,000 in the aggregate)
before any distributions are made to the holders of Advanta's common stock.
DESCRIPTION OF COMMON STOCK OF ADVANTA
CLASS B COMMON STOCK -- GENERAL
The authorized capital of Advanta includes 200,000,000 shares of Class B
Common Stock, par value $.01 per share, of which 23,281,895 shares were
outstanding on March 31, 1995. All outstanding shares are fully paid and
non-assessable. The holders of Advanta's Class B Common Stock are entitled to
the same rights as the holders of Advanta's Class A Common Stock described
below, except that the holders of Class B Common Stock may not vote (i) in the
election of directors, (ii) on an amendment to Advanta's Certificate of
Incorporation (including an amendment to increase the authorized shares of Class
B Common Stock), (iii) on a proposed merger or consolidation, (iv) on a proposed
dissolution of Advanta, or (v) on any other matter except to the extent
described below or as required under the General Corporation Law of the State of
Delaware. Holders of Class B Common Stock are entitled to vote on proposals to
change the par value of the Class B Common Stock or to alter or change the
powers, preferences or special rights of the shares of Class B Common Stock,
including the dividend and Class B protection features described below, which
proposals may affect them adversely. Holders of the Class B Common Stock are
also entitled to the additional rights described in the following subsections.
Only Class B Common Stock may be offered pursuant to this Prospectus and the
accompanying Prospectus Supplement.
CLASS A COMMON STOCK -- GENERAL
The authorized capital of Advanta includes 200,000,000 shares of Class A
Common Stock, par value $.01 per share, of which 17,410,718 shares were
outstanding on March 31, 1995. All outstanding shares are fully paid and
non-assessable. The holders of Advanta's Class A Common Stock are entitled to
one vote per share; to receive such dividends, in conjunction with dividends to
holders of Advanta's Class B Common Stock, as legally may be declared by the
Board of Directors, after dividends are paid to holders of preferred stock, as
described below; and upon liquidation, to receive any net assets of Advanta
after the liquidation rights of all holders of preferred stock, if any, have
been satisfied. There are no preemptive, conversion, cumulative voting, or
redemption rights applicable to the Class A Common Stock. No Class A Common
Stock may be offered pursuant to this Prospectus and the accompanying Prospectus
Supplement.
DIVIDENDS AND OTHER DISTRIBUTIONS
Any cash dividend with respect to either Class A Common Stock or Class B
Common Stock must be accompanied by a dividend on the other class of common
stock. The Board of Directors may, however, in its discretion, declare a
dividend per share with respect to the Class B Common Stock which can be up to
20% higher (but under no circumstances lower) than the dividend declared with
respect to the Class A Common Stock. In all other respects the dividends and
other distributions, including the per share consideration in the event of a
merger or consolidation, with respect to Class A Common Stock and Class B Common
Stock are equal, except that dividends or other distributions payable in shares
of common stock may be made only as follows: (i) in shares of Class B Common
Stock to the holders of both Class A Common Stock and Class B Common Stock, (ii)
in shares of Class A Common Stock to the holders of Class A Common Stock and in
shares of Class B Common Stock to the holders of Class B Common Stock, or (iii)
in any other authorized class or series of capital stock to the holders of both
classes of common stock. Neither the Class A Common Stock nor the Class B Common
Stock may be split, subdivided or combined unless the other is proportionately
split, subdivided or combined.
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Although it is the present intention of the Board to maintain a higher
dividend on the Class B Common Stock, the Board of Directors is not required to
declare a higher dividend on the Class B Common Stock and the amount of future
dividends, if any, on each class of common stock will depend on circumstances
existing at the time, including the sufficiency of funds legally available for
the payment of dividends.
CLASS B PROTECTION
Because of the existence of the two classes of common stock, one class with
voting rights and the other with no voting rights, voting rights
disproportionate to equity ownership could be acquired through acquisitions of
Class A Common Stock. The Board of Directors was advised that, while either
class of common stock might trade at a premium relative to the other, the
non-voting or lesser-voting common stocks of public companies with dual class
capital structures frequently trade at a discount from the full voting common
stocks of such companies. Advanta therefore adopted the "Class B Protection"
features described below as a means of helping to reduce or eliminate the
economic reasons for the Class A Common Stock and Class B Common Stock to trade
at disparate market prices, and to give holders of Class B Common Stock the
opportunity to participate in any premium paid in the future for a significant
block (10% or more) of the Class A Common Stock by a buyer who has not acquired
a proportionate share of the Class B Common Stock. Although Advanta adopted the
"Class B Protection" features and has paid a higher dividend on the Class B
Common Stock in an attempt to minimize any price differential between the
classes of common stock, in fact the Class A Common Stock and the Class B Common
Stock generally have traded at disparate market prices. During the period in
which the two classes of common stock have existed, this differential has been
as much as $8.50 and as low as zero. Advanta adopted the division of the common
stock into two classes with the expressed expectation that Advanta generally
would issue shares of Class B Common Stock rather than Class A Common Stock in
the future to raise equity, to finance acquisitions or pursuant to incentive
compensation plans, even if the market price per share of the Class B Common
Stock was lower at the relevant time than the market price per share of Class A
Common Stock. There can be no assurance that the price differential between the
Class A Common Stock and the Class B Common Stock will be reduced or eliminated
or as to the extent or continuation of any such price differential in the
future.
Pursuant to the applicable provisions of Advanta's Restated Certificate of
Incorporation, if any person or group acquires (other than upon issuance or sale
by Advanta, by operation of law, by will or the laws of descent and
distribution, by gift, or by foreclosure of a bona fide loan) beneficial
ownership of shares of Class A Common Stock constituting 10% or more of the then
issued and outstanding shares of Class A Common Stock (any person or group
making such acquisition being defined as a "Significant Stockholder"), and such
person or group does not then own shares of Class B Common Stock constituting an
equal or greater percentage of all then issued and outstanding shares of Class B
Common Stock, such Significant Stockholder must, within a 90-day period
beginning the day after becoming a Significant Stockholder, commence a public
tender offer to acquire additional shares (as described below) of Class B Common
Stock (a "Class B Protection Transaction"). For purposes of this provision, the
terms "beneficial ownership" and "group" have the same meanings as used in
Regulation 13D promulgated under the Exchange Act. The Class B Protection
feature does not change the ability of Dennis Alter or any member of his family
or other management stockholder to transfer a significant voting interest in
Advanta to another person or group by the sale of their voting shares to such
person or group. However, such person or group may also be required to purchase
a proportionate amount of Class B Common Stock either concurrently from such
stockholder or other persons or pursuant to a Class B Protection Transaction, as
described below.
In a Class B Protection Transaction, the Significant Stockholder must offer
to acquire from the holders of the Class B Common Stock that additional number
of shares of Class B Common Stock (the "Additional Shares") determined by (i)
multiplying the percentage of issued and outstanding shares of Class A Common
Stock beneficially owned by such Significant Stockholder which were acquired
after April 24, 1992 by the total number of shares of Class B Common Stock
outstanding on the date such
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person or group became a Significant Stockholder, and (ii) subtracting therefrom
the total number of shares of Class B Common Stock beneficially owned by such
Significant Stockholder on such date which were acquired after the initial
distribution of Class B Common Stock to stockholders on May 5, 1992 pursuant to
the Certificate of Amendment to Advanta's Restated Certificate of Incorporation
(including shares acquired on such date at or prior to the time such person or
group became a Significant Stockholder). The Significant Stockholder must
acquire all shares validly tendered or, if the number of shares tendered exceeds
the number determined pursuant to such formula, a pro rata amount from each
tendering holder.
The offer price for any shares of Class B Common Stock required to be
purchased by the Significant Stockholder pursuant to a Class B Protection
Transaction is the greater of (i) the highest price per share paid by the
Significant Stockholder for any share of Class A Common Stock in the six-month
period ending on the date such person or group became a Significant Stockholder
or (ii) the highest price of a share of Class A Common Stock or Class B Common
Stock (whichever is higher) as reported on the Nasdaq National Market (or such
other quotation system or securities exchange constituting the principal trading
market for either class of common stock) on the date such person or group became
a Significant Stockholder.
A Class B Protection Transaction is also required each time a Significant
Stockholder acquires an additional 10% of the then issued and outstanding Class
A Common Stock (other than upon issuance or sale by Advanta, by operation of
law, by will or the laws of descent and distribution, by gift, or by foreclosure
of a bona fide loan) after the last acquisition by such person or group which
triggered the requirement for a Class B Protection Transaction, if such
Significant Stockholder does not then beneficially own shares of Class B Common
Stock acquired after the initial distribution of Class B Common Stock to
stockholders on May 5, 1992 constituting an equal or greater percentage of all
then issued and outstanding shares of Class B Common Stock. Such Significant
Stockholder would be required to offer to buy that number of Additional Shares
prescribed by the formula set forth above, even if a previous Class B Protection
Transaction resulted in fewer shares of Class B Common Stock being tendered than
such previous offer included.
The requirement to engage in a Class B Protection Transaction is satisfied
by making the requisite offer and purchasing validly tendered shares, even if
the number of shares tendered is less than the number of shares included in the
required offer. The penalty applicable to any Significant Stockholder that fails
to make the required offer, or to purchase shares validly tendered (after
proration, if any), is to automatically suspend the voting rights of the shares
of Class A Common Stock owned by such Significant Stockholder until consummation
of an offer as required or until divestiture of the shares of Class A Common
Stock that triggered the offer requirement. To the extent that the voting power
of any shares of Class A Common Stock is so suspended, such shares will not be
included in the determination of aggregate voting shares for any purpose.
Neither the Class B Protection Transaction requirement nor the related penalty
applies to any increase in percentage ownership of Class A Common Stock
resulting solely from a change in the total amount of Class A Common Stock
outstanding.
The Class B Protection provision does not prevent any person or group from
acquiring a significant or controlling interest in Advanta, provided such person
or group acquires a proportionate percentage of the Class B Common Stock. If a
Class B Protection Transaction is prescribed, the purchase price required to be
paid in such offer may be higher than the price at which a Significant
Stockholder might otherwise be able to acquire an identical amount of Class B
Common Stock. Such requirement, therefore, could make an acquisition of a
significant or controlling interest in Advanta more expensive and more time
consuming than if such requirement did not exist. Consequently, a person or
group might be deterred from acquiring a significant or controlling interest in
Advanta as a result of such requirement. Moreover, by restricting the ability of
an acquiror to acquire a significant interest in the Class A Common Stock by
paying a "control premium" for such stock without acquiring, or paying a similar
premium for, Class B Common Stock, the Class B Protection provision should
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reduce or eliminate the economic reasons for the Class A Common Stock and Class
B Common Stock to trade at disparate market prices.
CONVERTIBILITY
Except as described below, neither the Class A Common Stock nor the Class B
Common Stock is convertible into another class of common stock or any other
security of Advanta.
The Class B Common Stock could be converted into Class A Common Stock on a
share-for-share basis by resolution of the Board of Directors if, as a result of
the existence of the Class B Common Stock, the Class A Common Stock or the Class
B Common Stock or both become excluded from quotation on the Nasdaq National
Market, or, if such shares are then listed on a national securities exchange,
from trading on the principal national securities exchange on which the shares
are then traded.
In addition, if at any time, as a result of additional issuances by Advanta
of Class B Common Stock, repurchases by Advanta of Class A Common Stock or a
combination of such issuances and repurchases, the number of outstanding shares
of Class A Common Stock as reflected on the stock transfer books of Advanta
falls below 10% of the aggregate number of outstanding shares of Class A Common
Stock and Class B Common Stock, then, immediately upon the occurrence of such
event, all the outstanding shares of Class B Common Stock will be automatically
converted into shares of Class A Common Stock, on a share-for-share basis. For
purposes of the immediately preceding sentence, any shares of Class A Common
Stock or Class B Common Stock repurchased by Advanta will no longer be deemed
"outstanding" from and after the date of repurchase. Advanta has no present
intention to repurchase any shares of its common stock. In view of the absence
of a present intention by Advanta to purchase any shares of common stock and the
substantial number of shares of Class B Common Stock that would be required to
be issued to reach the 10% threshold, Advanta believes it unlikely that this
provision will be triggered in the foreseeable future.
ISSUANCE OF CAPITAL SECURITIES OF ADVANTA UPON CONVERSION OR EXCHANGE
GENERAL
A Prospectus Supplement may provide that Capital Securities will be
issuable in exchange for or upon conversion of Debt Securities, Class B
Preferred Stock, Depositary Shares or Preferred Shares. "Capital Securities" may
consist of common stock, preferred stock, or other securities of Advanta. The
Prospectus Supplement relating to a series of Debt Securities, Class B Preferred
Stock, or Preferred Shares which are exchangeable for or convertible into
Capital Securities will contain a description of the Capital Securities.
TENDER OFFER RULES
Rules 13e-4 and 14e-1 of the Commission's rules and regulations relating to
tender offers by issuers, as currently in effect and interpreted, may be
applicable to exchanges or conversions such as that of Capital Securities for
Debt Securities, Class B Preferred Stock or Preferred Shares. If, at the time of
any such exchange or conversion, Rule 13e-4 or Rule 14e-1 (or any successor rule
or rules) applies to such transaction, Advanta will comply with such rule (or
any successor rule or rules), and will afford holders of such Debt Securities,
Class B Preferred Stock or Preferred Shares, all rights and will make all
filings required by such rule (or successor rule or rules).
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<PAGE> 25
DESCRIPTION OF SECURITIES WARRANTS OF ADVANTA
Advanta may issue, together with any Debt Securities or Class B Preferred
Stock or Class B Common Stock offered by any Prospectus Supplement or
separately, Securities Warrants for the purchase of other Debt Securities or
Class B Preferred Stock or Class B Common Stock. The Securities Warrants are to
be issued under warrant agreements (each a "Securities Warrant Agreement") to be
entered into between Advanta and a bank or trust company, as warrant agent
("Securities Warrant Agent"), all as set forth in the Prospectus Supplement
relating to the particular series of Securities Warrants. The form of Securities
Warrant Agreement, including the form of certificates representing the
Securities Warrants ("Securities Warrant Certificates"), reflecting the
alternative provisions to be included in the Securities Warrant Agreements that
will be entered into with respect to particular offerings of Securities
Warrants, will be filed as an exhibit to the Registration Statement of which
this Prospectus forms a part. The following summaries of certain provisions of
the Securities Warrant Agreement and the Securities Warrant Certificates do not
purport to be complete and are subject to, and are qualified in their entirety
by reference to, all the provisions of the Securities Warrant Agreement and the
Securities Warrant Certificates, respectively, including the definitions therein
of certain terms. Wherever defined terms of the Securities Warrant Agreement are
referred to, it is intended that such defined terms shall be incorporated herein
by reference.
GENERAL
The Prospectus Supplement relating to the particular series of Securities
Warrants offered thereby will describe the terms of the offered Securities
Warrants, the Securities Warrant Agreement relating to the offered Securities
Warrants and the Securities Warrant Certificates representing the offered
Securities Warrants, including the following: (i) if the Securities Warrants are
offered for separate consideration, the offering price and the Currency for
which Securities Warrants may be purchased; (ii) if applicable, the designation,
aggregate principal amount, purchase price, Currency and terms of the series of
Debt Securities purchasable upon exercise of the offered Securities Warrants;
(iii) if applicable, the designation, number, stated value and terms (including,
without limitation, liquidation, dividend, conversion and voting rights) of the
shares of Class B Preferred Stock purchasable upon exercise of Preferred Stock
Warrants and the price at which such number of shares of Class B Preferred Stock
may be purchased upon such exercise; (iv) if applicable, the number of shares of
Class B Common Stock purchasable upon exercise of Common Stock Warrants and the
price at which such number of shares of Class B Common Stock may be purchased
upon such exercise; (v) the date, if any, on and after which the offered
Securities Warrants and the related Debt Securities and/or Class B Preferred
Stock and/or Class B Common Stock will be separately transferable; (vi) the date
on which the right to exercise the offered Securities Warrants shall commence
and the date ("Expiration Date") on which such right shall expire; (vii) a
discussion of the specific U.S. federal income tax, accounting and other
considerations applicable to the Securities Warrants or to any Debt Securities
(including Original Issue Discount Debt Securities) purchasable upon exercise of
such Securities Warrants; (viii) whether the offered Securities Warrants
represented by the Securities Warrant Certificates will be issued in registered
or bearer form, and if registered, where they may be transferred and registered;
(ix) any applicable anti-dilution provisions; (x) any applicable redemption or
call provisions; (xi) any applicable book entry provisions; and (xii) any other
terms of the offered Securities Warrants.
Securities Warrant Certificates will be exchangeable on the terms specified
in the Prospectus Supplement for new Securities Warrant Certificates of
different denominations and Securities Warrants may be exercised at the
corporate trust office of the Securities Warrant Agent or any other office
indicated in the Prospectus Supplement relating thereto. Prior to the exercise
of their Securities Warrants, holders of Securities Warrants will not have any
of the rights of holders of the Debt Securities or Class B Preferred Stock or
Class B Common Stock purchasable upon such exercise, including the right in the
case of Debt Warrants to payments of principal of or any premium or interest, if
any, on the Debt Securities purchasable upon such exercise, or to enforce
covenants in the applicable Indenture and in the case of Preferred Stock
Warrants and Common Stock Warrants, the
22
<PAGE> 26
right to receive payments of dividends or distributions of any kind, if any, on
the Class B Preferred Stock and Class B Common Stock, respectively, purchasable
upon exercise or to exercise any applicable right to vote.
EXERCISE OF WARRANTS
Each Securities Warrant will entitle the holder thereof to purchase such
principal amount of Debt Securities or such number of shares of Class B
Preferred Stock or Class B Common Stock, as the case may be, at such exercise
price as shall in each case be set forth in, or be determinable from, the
Prospectus Supplement relating to the Securities Warrants, by payment of such
exercise price in full in the Currency and in the manner specified in the
Prospectus Supplement. Securities Warrants may be exercised at any time up to
the close of business on the Expiration Date (or such later date to which such
Expiration Date may be extended by Advanta); unexercised Securities Warrants
will become void.
Upon receipt at the corporate trust office of the Securities Warrant Agent
or any other office indicated in the Prospectus Supplement of (i) payment of the
exercise price and (ii) the Securities Warrant Certificate properly completed
and duly executed, Advanta will, as soon as practicable, forward the Debt
Securities or shares of Class B Preferred Stock or Class B Common Stock
purchasable upon such exercise to the holder of such Securities Warrant. If less
than all of the Securities Warrants represented by such Warrant Certificate are
exercised, a new Securities Warrant Certificate will be issued for the remaining
number of Securities Warrants.
DESCRIPTION OF STOCK PURCHASE CONTRACTS
AND STOCK PURCHASE UNITS OF ADVANTA
Advanta may issue Stock Purchase Contracts, including contracts obligating
holders to purchase from Advanta, and Advanta to sell to the holders, a
specified number of shares of Class B Common Stock or Class B Preferred Stock at
a future date or dates. The price per share of Class B Preferred Stock or Class
B Common Stock may be fixed at the time the Stock Purchase Contracts are issued
or may be determined by reference to a specific formula set forth in the Stock
Purchase Contracts. The Stock Purchase Contracts may be issued separately or as
a part of units ("Stock Purchase Units"), each consisting of a Stock Purchase
Contract and debt obligations of the United States of America or agencies or
instrumentalities thereof securing the holders' obligations to purchase the
Class B Preferred Stock or the Class B Common Stock under the Stock Purchase
Contracts. The Stock Purchase Contracts may require Advanta to make periodic
payments to the holders of the Stock Purchase Units or vice versa, and such
payments may be unsecured or prefunded on some basis. The Stock Purchase
Contracts may require holders to secure their obligations thereunder in a
specified manner.
The applicable Prospectus Supplement will describe the terms of any Stock
Purchase Contracts or Stock Purchase Units. The description in the Prospectus
Supplement will not purport to be complete and will be qualified in its entirety
by reference to the Stock Purchase Contracts, and, if applicable, collateral
arrangements and depositary arrangements, relating to such Stock Purchase
Contracts or Stock Purchase Units.
DESCRIPTION OF PREFERRED SHARES OF ADVANTA CAPITAL
GENERAL
Advanta Capital may from time to time issue Preferred Shares, in one or
more series, having terms described in the Prospectus Supplement relating
thereto, including any terms relating to the redemption of the Preferred Shares
upon the occurrence of certain events described in the Prospectus Supplement.
Under Advanta Capital's Limited Liability Company Agreement, the Manager may
establish one or more classes or series of Preferred Shares, having such terms,
including dividends,
23
<PAGE> 27
redemption, voting, liquidation rights and such other preferred or other special
rights or such restrictions, as the Manager may determine, to be set forth in a
Prospectus Supplement. All Preferred Shares of Advanta Capital offered by any
Prospectus Supplement will be guaranteed by Advanta to the extent set forth
below under "Guarantee" and in the Prospectus Supplement and may also be
entitled to the benefits of certain undertakings of Advanta as described below
under "Backup Undertakings" and in the Prospectus Supplement. Any special
federal income tax, accounting and other considerations applicable to any
offering of Preferred Shares and related Backup Undertakings will be described
in the Prospectus Supplement relating thereto.
The holders of Preferred Shares of a specified series that are convertible
into Capital Securities of Advanta ("Convertible Preferred Shares") will be
entitled at certain times specified in the Prospectus Supplement relating to
such Convertible Preferred Shares, subject to prior redemption, exchange,
repayment or repurchase, to convert any Convertible Preferred Shares of such
series into Capital Securities, at the conversion price set forth in such
Prospectus Supplement, subject to adjustment and to such other terms as are set
forth in such Prospectus Supplement.
The holders of Preferred Shares of any series may be obligated at any time
or at Maturity to exchange them for Capital Securities of Advanta. The terms of
any such exchange and any such Capital Securities will be described in the
Prospectus Supplement relating to such series of Preferred Shares. The Class B
Common Stock, Class B Preferred Stock and other Capital Securities of Advanta
are described above under "Description of Class B Common Stock of Advanta,"
"Description of Class B Preferred Stock of Advanta," and "Issuance of Capital
Securities of Advanta upon Conversion or Exchange," respectively.
GUARANTEE
Unless otherwise specified in the applicable Prospectus Supplement, Advanta
will irrevocably and unconditionally agree, to the extent set forth in a Payment
and Guarantee Agreement (the "Guarantee"), to pay in full, to the holders of
Preferred Shares of any class or series, the Guarantee Payments (as defined
below), as and when due, regardless of any defense, right of setoff or
counterclaim which Advanta Capital may have or assert. The Guarantee will
constitute a guarantee of payment and not of collection, and may be enforced by
holders of Preferred Shares directly against Advanta. The following payments, to
the extent not paid by Advanta Capital (the "Guarantee Payments"), will be
subject to the Guarantee: (i) any arrears and accruals of unpaid dividends which
have theretofore been declared on the Preferred Shares of such class or series
out of moneys legally available therefor; (ii) the redemption price including
all arrears and accruals of unpaid dividends payable, out of moneys legally
available therefor with respect to any Preferred Shares of such class or series
called for redemption; and (iii) upon a liquidation of Advanta Capital, the
lesser of (a) the liquidation preference and all arrears and accruals of unpaid
dividends (whether or not declared) on the Preferred Shares of such class or
series to the date of payment or (b) the amount of assets of Advanta Capital
legally available for distribution in such liquidation. In addition, the
Prospectus Supplement relating to a class or series of Preferred Shares will
describe the rank of the Guarantee and any additional covenants or other terms
of the Guarantee with respect to such class or series.
BACKUP UNDERTAKINGS
In connection with any class or series of Preferred Shares, Advanta may
enter into additional arrangements with Advanta Capital, including intercompany
loan agreements and amendments to Advanta Capital's Limited Liability Company
Agreement and Certificate of Formation, that operate directly or indirectly for
the benefit of holders of the Preferred Shares. The Guarantee and any such other
arrangements are herein collectively referred to as "Backup Undertakings" of
Advanta and will be described in the Prospectus Supplement relating to any class
or series of Preferred Shares to which they apply.
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<PAGE> 28
PLAN OF DISTRIBUTION
Advanta and/or Advanta Capital, as the case may be, may sell the Securities
being offered hereby: (i) directly to purchasers; (ii) through agents; (iii)
through underwriters; (iv) through dealers; or (v) through a combination of any
such methods of sale. The Securities may also be used as all or part of the
consideration to be paid by Advanta for property or assets.
The distribution of the Securities may be effected from time to time in one
or more transactions: (i) at a fixed price or prices, which may be changed; (ii)
at market prices prevailing at the time of sale; (iii) at prices related to such
prevailing market prices; or (iv) at negotiated prices.
Offers to purchase Securities may be solicited directly by Advanta or by
agents designated by Advanta and/or Advanta Capital from time to time. Any such
agent, which may be deemed to be an underwriter as that term is defined in the
Securities Act, involved in the offer or sale of the Securities in respect of
which this Prospectus is delivered will be named, and any commissions payable by
Advanta and/or Advanta Capital, as the case may be, to such agent will be set
forth, in the applicable Prospectus Supplement. Unless otherwise indicated in
the Prospectus Supplement, any such agent will be acting on a reasonable efforts
basis.
If an underwriter or underwriters are utilized in the sale of Securities in
respect of which this Prospectus and the accompanying Prospectus Supplement are
delivered, Advanta and/or Advanta Capital will execute an underwriting agreement
with such underwriters at the time of sale to them and the names of the
underwriters and the terms of the transaction will be set forth in the
Prospectus Supplement, which will be used by the underwriters to make resales of
the Securities in respect of which this Prospectus is delivered to the public.
If a dealer is utilized in the sale of the Securities in respect of which
this Prospectus is delivered, Advanta and/or Advanta Capital will sell such
Securities to the dealer, as principal. The dealer may then resell such
Securities to the public at varying prices to be determined by such dealer at
the time of resale.
Certain of the underwriters, dealers or agents may be customers of,
including borrowers from, engage in transactions with, and perform services for,
Advanta or one or more of its affiliates in the ordinary course of business.
Underwriters, dealers, agents and other persons may be entitled, under
agreements which may be entered into with Advanta and/or Advanta Capital, as the
case may be, to indemnification against certain civil liabilities, including
liabilities under the Securities Act.
If so indicated in the applicable Prospectus Supplement, Advanta or Advanta
Capital will authorize agents and underwriters to solicit offers by certain
institutions to purchase Securities from Advanta or Advanta Capital at the
public offering price set forth in the Prospectus Supplement pursuant to delayed
delivery contracts ("Contracts") providing for payment and delivery on the date
stated in the Prospectus Supplement. A commission indicated in the Prospectus
Supplement will be paid to underwriters and agents soliciting purchases of
Securities pursuant to Contracts accepted by Advanta or Advanta Capital.
LEGAL OPINIONS
Certain legal matters relating to certain of the Securities offered hereby
will be passed upon for Advanta by Gene S. Schneyer, Esquire, Vice President,
Secretary and General Counsel of Advanta. Certain legal matters relating to the
Class B Preferred Stock, the Class B Common Stock, the Depositary Shares, the
Securities Warrants, the Guarantees, the Capital Securities, the Stock Purchase
Contracts, Stock Purchase Units and the Preferred Shares will be passed upon for
Advanta and/or Advanta Capital by Wolf, Block, Schorr and Solis-Cohen. Wolf,
Block, Schorr and Solis-Cohen will also pass upon United States federal income
tax matters, as described in a Prospectus Supplement relating to the Securities
to be offered. Certain legal matters relating to the Securities offered hereby
will be passed upon for the agents and underwriters, if any, by Brown & Wood,
New York, New York. Mr. Schneyer owns or has the right to acquire a number of
shares of Class A and Class B Common Stock of Advanta which is well below l% of
the outstanding common stock of Advanta.
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<PAGE> 29
EXPERTS
The consolidated financial statements and schedules incorporated by
reference in this Prospectus and elsewhere in the Registration Statement to the
extent and for the periods indicated in their reports have been audited by
Arthur Andersen LLP, independent public accountants, and are incorporated herein
in reliance upon the authority of said firm as experts in giving said reports.
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<PAGE> 30
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.*
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee...................... $ 172,415
Printing and engraving................................................... 125,000
Blue Sky fees and expenses............................................... 50,000
Trustee's fee and expenses............................................... 50,000
Accounting services...................................................... 75,000
Legal fees and expenses (including those of counsel to the agents under
the Distribution Agreement)............................................ 250,000
Rating agency fees....................................................... 362,500
Miscellaneous............................................................ 15,085
----------
Total.......................................................... $1,100,000
=========
</TABLE>
- ---------------
* All expenses except registration fee are estimated.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law provides, inter alia,
that under specified circumstances a corporation shall have the power to
indemnify any person who is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding by reason of the
fact that such person is or was a director, officer, employee or agent of the
corporation, against expenses, attorneys' fees, judgments, fines and
settlements. The By-Laws of Advanta provide that Advanta shall indemnify any
director, officer, employee or agent of Advanta to the fullest extent now or
hereafter permitted by law in connection with any such action, suit or
proceeding. The By-Laws further provide that the Board of Directors of Advanta
may, by resolution, indemnify any person other than a director, officer,
employee or agent of Advanta for liabilities incurred in connection with
services rendered for or at the request of Advanta or its subsidiaries. In
addition, consistent with Section 102 of the Delaware General Corporation Law,
Advanta's Certificate of Incorporation limits the personal liability of
Advanta's directors to Advanta or its stockholders for monetary damages for
certain breaches of fiduciary duty. Advanta maintains director and officer
liability insurance which would provide coverage against certain securities law
liabilities.
Any underwriters, dealers or agents referred to in the agreements filed as
Exhibits 1.1 through 1.5 to this Registration Statement will agree to indemnify
Advanta's directors, its officers who signed the Registration Statement and its
controlling persons against certain liabilities which might arise under the
Securities Act from information furnished to Advanta by or on behalf of any such
indemnifying party.
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
ITEM DESCRIPTION
- -------- -----------------------------------------------------------------------------------
<C> <S>
1.1 Form of Underwriting Agreement -- Basic Provision relating to Debt Securities of
Advanta (incorporated by reference to Exhibit 1.1 to Advanta's Registration
Statement on Form S-3 (33-50883), filed November 2, 1993).
**1.2 Form of Distribution Agreement relating to Debt Securities.
**1.3 Form of Preferred Stock Purchase Agreement of Advanta.
**1.4 Form of Common Stock Purchase Agreement of Advanta.
**1.5 Form of Preferred Share Purchase Agreement of Advanta Capital.
*3.1 Certificate of Formation of Advanta Capital.
**3.2 Form of Limited Liability Company Agreement of Advanta Capital.
3.3 Restated Certificate of Incorporation of Advanta (incorporated by reference to
Exhibit 4.1 to Pre-Effective Amendment No. 1 to Advanta's Registration Statement
Form S-3 (File No. 33-53475), filed June 10, 1994).
</TABLE>
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<PAGE> 31
<TABLE>
<CAPTION>
ITEM DESCRIPTION
- -------- -----------------------------------------------------------------------------------
<S> <C>
3.4 By-Laws of Advanta, as amended (incorporated by reference to Exhibit 3.11 to
Advanta's Current Report on Form 8-K dated December 22, 1994, filed on the same
date).
**3.5 Form of Payment and Guarantee Agreement with respect to Preferred Shares of Advanta
Capital.
4.1 Specimen of Class A Common Stock Certificate and specimen of Class B Common Stock
Certificate (incorporated by reference to Exhibit 1 of Advanta's Amendment No. 1 to
Form 8 and Exhibit 1 to Advanta's Form 8-A, respectively, both dated April 22,
1992).
**4.2 Specimen of Class B Preferred Stock Certificate.
**4.3 Form of Certificate of Amendment to Advanta's Certificate of Incorporation relating
to the Class B Preferred Stock.
*4.4 Form of Senior Trust Indenture dated as of , 1995 between Advanta and
, as Trustee.
*4.5 Form of Subordinated Trust Indenture dated as of , 1995 between Advanta
and , as trustee.
**4.6 Form or forms of Debt Securities.
**4.7 Form of Debt Warrant Agreement.
**4.8 Form of Preferred Stock Warrant Agreement.
**4.9 Form of Common Stock Warrant Agreement.
**4.10 Form of Deposit Agreement (including form of Depositary Share).
**4.11 Form of Stock Purchase Contract of Advanta.
**4.12 Form of Preferred Share Certificate of Advanta Capital.
*5.1 Opinion of Gene S. Schneyer, Vice President, Secretary and General Counsel of
Advanta, as to the legality of certain of the Securities being offered.
*5.2 Opinion of Wolf, Block, Schorr and Solis-Cohen as to the legality of the Class B
Common Stock, Class B Preferred Stock, Preferred Shares and certain of the other
Securities being offered.
**8.1 Opinion of Wolf, Block, Schorr and Solis-Cohen as to certain tax matters.
*12.1 Statement regarding computation of ratios of earnings to fixed charges and
preferred stock dividends.
*23.1 Consent of Arthur Andersen LLP.
*23.2 Consent of Gene S. Schneyer, Vice President, Secretary and General Counsel of
Advanta (included in his opinion filed as Exhibit 5.1 hereto).
*23.3 Consent of Wolf, Block, Schorr and Solis-Cohen (included in its opinion filed as
Exhibit 5.2 hereto).
**23.4 Consent of Wolf, Block, Schorr and Solis-Cohen (to be included in its opinion filed
as Exhibit 8.1 hereto).
*24.1 Power of Attorney (set forth on signature page).
**25.1 Statement of Eligibility of as the trustee under the Senior
Trust Indenture (separately bound and filed).
**25.2 Statement of Eligibility of as the trustee under the Subordinated
Trust Indenture (separately bound and filed).
</TABLE>
- ---------------
* Filed herewith.
** To be filed by amendment. Advanta will file as an Exhibit to a Current Report
on Form 8-K any related forms utilized in the future and not previously filed
by means of an amendment.
ITEM 17. UNDERTAKINGS.
(a) The undersigned Registrants hereby undertake:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act;
(ii) To reflect in the Prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement. Notwithstanding the foregoing, any
increase or decrease in
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<PAGE> 32
volume of Securities offered (if the total dollar value of Securities
offered would not exceed that which was registered) and any deviation
from the low or high end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the Commission pursuant
to Rule 424(b) if, in the aggregate, the changes in volume and price
represent no more than a 20% change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee" table in the
effective Registration Statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement
or any material change to such information in the Registration
Statement;
provided, however, that the undertakings set forth in clauses (i) and (ii) of
this paragraph shall not apply if the information required to be included in
such post-effective amendments is contained in periodic reports filed by the
Registrants pursuant to Section 13 or Section 15(d) of the Exchange Act that are
incorporated by reference in this Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the Securities offered therein, and
the offering of such Securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the Securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrants hereby undertake that, for purposes of
determining any liability under the Securities Act, each filing of Advanta's
annual report pursuant to section 13(a) or section 15(d) of the Exchange Act
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 Securities at that time shall be deemed to be the initial
bona fide offering thereof.
(h) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers or controlling persons of the
Registrants pursuant to the foregoing provisions, or otherwise, the Registrants
have been advised that in the opinion of the 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 Registrants of expenses incurred or paid by a director,
officer or controlling person of the Registrants in the successful defense of
any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
Registrants will, unless in the opinion of their counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
(i) (1) For purposes of determining any liability under the Securities Act,
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,
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.
(j) The undersigned Registrants hereby undertake 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 ("Act") in accordance
with the rules and regulations prescribed by the Commission under section
305(b)(2) of the Act.
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<PAGE> 33
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the undersigned
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in Horsham Township, Montgomery County, Commonwealth of
Pennsylvania, on June 20, 1995.
ADVANTA CORP.
By: /s/ RICHARD A. GREENAWALT
------------------------------------
Richard A. Greenawalt, President,
Chief Operating Officer and Director
Pursuant to the requirements of the Securities Act of 1933, the undersigned
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in Horsham Township, Montgomery County, Commonwealth of
Pennsylvania, on June 20, 1995.
ADVANTA CAPITAL L.L.C.
By: Advanta Corp., as
Managing Member
By: /s/ RICHARD A. GREENAWALT
------------------------------------
Richard A. Greenawalt, President,
Chief Operating Officer and Director
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<PAGE> 34
KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned does hereby
constitute and appoint Dennis Alter, Richard A. Greenawalt, Alex W. Hart, John
J. Calamari, David D. Wesselink and Gene S. Schneyer, or any of them (with full
power to each of them to act alone), his or her true and lawful attorney-in-fact
and agent, with full power of substitution, for him or her and on his or her
behalf to sign, execute and file this Registration Statement on Form S-3 of
Advanta Corp. and Advanta Capital L.L.C., and any or all amendments (including,
without limitation, post-effective amendments and any amendment or amendments
increasing the amount of securities for which registration is being sought) to
this Registration Statement, with all exhibits and any and all documents
required to be filed with respect thereto, with the Securities and Exchange
Commission or any regulatory authority, granting unto such attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the premises
in order to effectuate the same as fully to all intents and purposes as he or
she might or could do if personally present, hereby ratifying and confirming all
that such attorneys-in-fact and agents, or any of them, or their substitute or
substitutes, may lawfully do or cause to be done.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities with Advanta Corp. and the Managing Member and on the date indicated.
<TABLE>
<CAPTION>
SIGNATURE DATE
- --------------------------------------------- -------------
<S> <C>
/s/ DENNIS ALTER June 16, 1995
- ---------------------------------------------
Dennis Alter
Chairman of the Board, Chief Executive
Officer and Director (Principal Executive
Officer)
/s/ ALEX W. HART June 16, 1995
- ---------------------------------------------
Alex W. Hart
Executive Vice Chairman and Director
/s/ RICHARD A. GREENAWALT June 16, 1995
- ---------------------------------------------
Richard A. Greenawalt
President, Chief Operating Officer and
Director
/s/ DAVID D. WESSELINK June 16, 1995
- ---------------------------------------------
David D. Wesselink
Senior Vice President and Chief Financial
Officer (Principal Financial Officer)
/s/ JOHN J. CALAMARI June 16, 1995
- ---------------------------------------------
John J. Calamari
Vice President, Finance, and Chief Accounting
Officer (Principal Accounting Officer)
/s/ ARTHUR P. BELLIS June 16, 1995
- ---------------------------------------------
Arthur P. Bellis, Director
/s/ MAX BOTEL June 16, 1995
- ---------------------------------------------
Max Botel, Director
</TABLE>
II-5
<PAGE> 35
<TABLE>
<CAPTION>
SIGNATURE DATE
- --------------------------------------------- -------------
<S> <C>
/s/ RICHARD J. BRAEMER June 16, 1995
- ---------------------------------------------
Richard J. Braemer, Director
/s/ ANTHONY P. BRENNER June 16, 1995
- ---------------------------------------------
Anthony P. Brenner, Director
/s/ WILLIAM C. DUNKELBERG June 16, 1995
- ---------------------------------------------
William C. Dunkelberg, Director
/s/ ROBERT C. HALL June 16, 1995
- ---------------------------------------------
Robert C. Hall, Director
/s/ WARREN KANTOR June 16, 1995
- ---------------------------------------------
Warren Kantor, Director
/s/ RONALD J. NAPLES June 16, 1995
- ---------------------------------------------
Ronald J. Naples, Director
/s/ PHILLIP A. TURBERG June 16, 1995
- ---------------------------------------------
Phillip A. Turberg, Director
</TABLE>
II-6
<PAGE> 36
EXHIBIT INDEX
<TABLE>
<CAPTION>
ITEM DESCRIPTION PAGE
- -------- ---------------------------------------------------------------------------- ----
<S> <C> <C>
1.1 Form of Underwriting Agreement -- Basic Provision relating to Debt
Securities of Advanta (incorporated by reference to Exhibit 1.1 to Advanta's
Registration Statement on Form S-3 (33-50883), filed November 2, 1993).
**1.2 Form of Distribution Agreement relating to Debt Securities.
**1.3 Form of Preferred Stock Purchase Agreement of Advanta.
**1.4 Form of Common Stock Purchase Agreement of Advanta.
**1.5 Form of Preferred Share Purchase Agreement of Advanta Capital.
*3.1 Certificate of Formation of Advanta Capital.
**3.2 Form of Limited Liability Company Agreement of Advanta Capital.
3.3 Restated Certificate of Incorporation of Advanta (incorporated by reference
to Exhibit 4.1 to Pre-Effective Amendment No. 1 to Advanta's Registration
Statement Form S-3 (File No. 33-53475), filed June 10, 1994).
3.4 By-Laws of Advanta, as amended (incorporated by reference to Exhibit 3.11 to
Advanta's Current Report on Form 8-K dated December 22, 1994, filed on the
same date).
**3.5 Form of Payment and Guarantee Agreement with respect to Preferred Shares of
Advanta Capital.
4.1 Specimen of Class A Common Stock Certificate and specimen of Class B Common
Stock Certificate (incorporated by reference to Exhibit 1 of Advanta's
Amendment No. 1 to Form 8 and Exhibit 1 to Advanta's Form 8-A, respectively,
both dated April 22, 1992).
**4.2 Specimen of Class B Preferred Stock Certificate.
**4.3 Form of Certificate of Amendment to Advanta's Certificate of Incorporation
relating to the Class B Preferred Stock.
*4.4 Form of Senior Trust Indenture dated as of , 1995 between
Advanta and, as Trustee.
*4.5 Form of Subordinated Trust Indenture dated as of , 1995 between
Advanta and , as trustee.
**4.6 Form or forms of Debt Securities.
**4.7 Form of Debt Warrant Agreement.
**4.8 Form of Preferred Stock Warrant Agreement.
**4.9 Form of Common Stock Warrant Agreement.
**4.10 Form of Deposit Agreement (including form of Depositary Share).
**4.11 Form of Stock Purchase Contract of Advanta.
**4.12 Form of Preferred Share Certificate of Advanta Capital.
*5.1 Opinion of Gene S. Schneyer, Vice President, Secretary and General Counsel
of Advanta, as to the legality of certain of the Securities being offered.
*5.2 Opinion of Wolf, Block, Schorr and Solis-Cohen as to the legality of the
Class B Common Stock, Class B Preferred Stock, Preferred Shares and certain
of the other Securities being offered.
**8.1 Opinion of Wolf, Block, Schorr and Solis-Cohen as to certain tax matters.
*12.1 Statement regarding computation of ratios of earnings to fixed charges and
preferred stock dividends.
</TABLE>
<PAGE> 37
<TABLE>
<CAPTION>
ITEM DESCRIPTION PAGE
- -------- ---------------------------------------------------------------------------- ----
<C> <S> <C>
*23.1 Consent of Arthur Andersen LLP.
*23.2 Consent of Gene S. Schneyer, Vice President, Secretary and General Counsel
of Advanta (included in his opinion filed as Exhibit 5.1 hereto).
*23.3 Consent of Wolf, Block, Schorr and Solis-Cohen (included in its opinion
filed as Exhibit 5.2 hereto).
**23.4 Consent of Wolf, Block, Schorr and Solis-Cohen (to be included in its
opinion filed as Exhibit 8.1 hereto).
*24.1 Power of Attorney (set forth on signature page).
**25.1 Statement of Eligibility of as the trustee under the Senior Trust
Indenture (separately bound and filed).
**25.2 Statement of Eligibility of as the trustee under the
Subordinated Trust Indenture (separately bound and filed).
</TABLE>
- ---------------
* Filed herewith.
** To be filed by amendment. Advanta will file as an Exhibit to a Current Report
on Form 8-K any related forms utilized in the future and not previously filed
by means of an amendment.
<PAGE> 1
EXHIBIT 3.1
CERTIFICATE OF FORMATION
ADVANTA CAPITAL L.L.C.
This Certificate of Formation of Advanta Capital L.L.C. (the "L.L.C."),
dated as of May 15, 1995, is being duly executed and filed by Advanta Corp., as
an authorized person, to form a limited liability company under the Delaware
Limited Liability Company Act (6 DelC. sec.18-101, et seq.)
1. The name of the limited liability company formed hereby is Advanta
Capital L.L.C.
2. The address of the registered office of the L.L.C. in the State of
Delaware is 32 Loockerman Square, Suite L-100, City of Dover, County of Kent,
Delaware 19901. The name of its registered agent at such address is The
Prentice-Hall Corporation System, Inc.
3. The latest date on which the L.L.C. is to dissolve is May 15, 2095.
IN WITNESS WHEREOF, the undersigned has executed this Certificate of
Formation as of the date first above written.
Advanta Corp.
By: /s/ GENE S. SCHNEYER
------------------------------------
Name: Gene S. Schneyer
Title: Vice President
<PAGE> 1
Advanta Corp.,
Issuer
to
Trustee
SENIOR INDENTURE
Dated as of , 1995
Senior Debt Securities
<PAGE> 2
TABLE OF CONTENTS
Recitals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 101. Definitions. . . . . . . . . . . . . . . . . . . . . . . . . 2
Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Additional Amounts . . . . . . . . . . . . . . . . . . . . . 2
Affiliate . . . . . . . . . . . . . . . . . . . . . . . . . 2
Authenticating Agent . . . . . . . . . . . . . . . . . . . . 3
Authorized Newspaper . . . . . . . . . . . . . . . . . . . . 3
Bearer Security . . . . . . . . . . . . . . . . . . . . . . 3
Board of Directors . . . . . . . . . . . . . . . . . . . . . 3
Board Resolution . . . . . . . . . . . . . . . . . . . . . . 3
Business Day . . . . . . . . . . . . . . . . . . . . . . . . 3
Commission . . . . . . . . . . . . . . . . . . . . . . . . . 3
Common Stock . . . . . . . . . . . . . . . . . . . . . . . . 3
Company . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Company Request and Company Order . . . . . . . . . . . . . 4
Consolidated Assets . . . . . . . . . . . . . . . . . . . . 4
Controlled Subsidiary . . . . . . . . . . . . . . . . . . . 4
Conversion Price . . . . . . . . . . . . . . . . . . . . . . 4
Convertible Security . . . . . . . . . . . . . . . . . . . 4
Corporate Trust Office . . . . . . . . . . . . . . . . . . . 4
Corporation . . . . . . . . . . . . . . . . . . . . . . . . 4
Coupon . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Currency or Money . . . . . . . . . . . . . . . . . . . . . 4
Currency Indexed Note . . . . . . . . . . . . . . . . . . . 5
Date of Conversion . . . . . . . . . . . . . . . . . . . . . 5
Defaulted Interest . . . . . . . . . . . . . . . . . . . . . 5
Dollars or $ . . . . . . . . . . . . . . . . . . . . . . . . 5
Event of Default . . . . . . . . . . . . . . . . . . . . . . 5
Government Obligations . . . . . . . . . . . . . . . . . . . 5
Holder . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Indenture . . . . . . . . . . . . . . . . . . . . . . . . . 6
Independent Public Accountants . . . . . . . . . . . . . . . 6
Indexed Security . . . . . . . . . . . . . . . . . . . . . . 6
Interest . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Interest Payment Date . . . . . . . . . . . . . . . . . . . 6
<PAGE> 3
Legal Holiday . . . . . . . . . . . . . . . . . . . . . . . 6
Maturity . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Office or Agency . . . . . . . . . . . . . . . . . . . . . . 7
Officers' Certificate . . . . . . . . . . . . . . . . . . . 7
Opinion of Counsel . . . . . . . . . . . . . . . . . . . . . 7
Original Issue Discount Security . . . . . . . . . . . . . . 7
Outstanding . . . . . . . . . . . . . . . . . . . . . . . . 7
Paying Agent . . . . . . . . . . . . . . . . . . . . . . . . 9
Person . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Place of Payment . . . . . . . . . . . . . . . . . . . . . . 9
Predecessor Security . . . . . . . . . . . . . . . . . . . . 9
Redemption Date . . . . . . . . . . . . . . . . . . . . . . 9
Redemption Price . . . . . . . . . . . . . . . . . . . . . . 9
Registered Security . . . . . . . . . . . . . . . . . . . . 9
Regular Record Date . . . . . . . . . . . . . . . . . . . . 9
Responsible Officer . . . . . . . . . . . . . . . . . . . . 9
Security or Securities . . . . . . . . . . . . . . . . . . . 9
Security Register and Security Registrar . . . . . . . . . . 10
Significant Subsidiary . . . . . . . . . . . . . . . . . . . 10
Special Record Date . . . . . . . . . . . . . . . . . . . . 10
Stated Maturity . . . . . . . . . . . . . . . . . . . . . . 10
Subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . 10
Trust Indenture Act . . . . . . . . . . . . . . . . . . . . 10
Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . 10
United States . . . . . . . . . . . . . . . . . . . . . . . 10
United States Alien . . . . . . . . . . . . . . . . . . . . 11
U.S. Depository or Depository . . . . . . . . . . . . . . . 11
Vice President . . . . . . . . . . . . . . . . . . . . . . . 11
Voting Stock . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 102. Compliance Certificates and Opinions. . . . . . . . . . . . 11
Section 103. Form of Documents Delivered to Trustee. . . . . . . . . . . 12
Section 104. Acts of Holders. . . . . . . . . . . . . . . . . . . . . . . 12
Section 105. Notices, etc. to Trustee and Company. . . . . . . . . . . . 15
Section 106. Notice to Holders of Securities; Waiver. . . . . . . . . . . 16
Section 107. Language of Notices. . . . . . . . . . . . . . . . . . . . . 17
Section 108. Conflict with Trust Indenture Act. . . . . . . . . . . . . . 17
Section 109. Effect of Headings and Table of Contents. . . . . . . . . . 17
Section 110. Successors and Assigns. . . . . . . . . . . . . . . . . . . 17
Section 111. Separability Clause. . . . . . . . . . . . . . . . . . . . . 17
Section 112. Benefits of Indenture. . . . . . . . . . . . . . . . . . . . 17
Section 113. Governing Law. . . . . . . . . . . . . . . . . . . . . . . . 17
Section 114. Legal Holidays . . . . . . . . . . . . . . . . . . . . . . . 18
ii
<PAGE> 4
ARTICLE TWO
SECURITIES FORMS
Section 201. Forms Generally. . . . . . . . . . . . . . . . . . . . . . . 18
Section 202. Form of Trustee's Certificate of Authentication. . . . . . . 19
Section 203. Securities in Global Form. . . . . . . . . . . . . . . . . . 19
ARTICLE THREE
THE SECURITIES
Section 301. Amount Unlimited; Issuable in Series. . . . . . . . . . . . 20
Section 302. Currency; Denominations. . . . . . . . . . . . . . . . . . . 24
Section 303. Execution, Authentication, Delivery and Dating. . . . . . . 24
Section 304. Temporary Securities. . . . . . . . . . . . . . . . . . . . 26
Section 305. Registration, Transfer and Exchange. . . . . . . . . . . . . 27
Section 306. Mutilated, Destroyed, Lost and Stolen Securities. . . . . . 31
Section 307. Payment of Interest and Certain Additional Amounts; Rights
to Interest and Certain Additional Amounts Preserved . . . . 33
Section 308. Persons Deemed Owners. . . . . . . . . . . . . . . . . . . . 34
Section 309. Cancellation. . . . . . . . . . . . . . . . . . . . . . . . 35
Section 310. Computation of Interest. . . . . . . . . . . . . . . . . . . 36
ARTICLE FOUR
SATISFACTION AND DISCHARGE
Section 401. Satisfaction and Discharge of Indenture. . . . . . . . . . . 36
Section 402. Satisfaction, Discharge and Defeasance of Securities of any
Series. . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 403. Application of Trust Money. . . . . . . . . . . . . . . . . 41
ARTICLE FIVE
REMEDIES
Section 501. Events of Default. . . . . . . . . . . . . . . . . . . . . . 42
Section 502. Acceleration of Maturity; Rescission and Annulment. . . . . 44
iii
<PAGE> 5
Section 503. Collection of Indebtedness and Suits for Enforcement by
Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . 45
Section 504. Trustee May File Proofs of Claim. . . . . . . . . . . . . . 46
Section 505. Trustee May Enforce Claims without Possession of Securities
or Coupons. . . . . . . . . . . . . . . . . . . . . . . . . 47
Section 506. Application of Money Collected. . . . . . . . . . . . . . . 47
Section 507. Limitations on Suits. . . . . . . . . . . . . . . . . . . . 48
Section 508. Unconditional Right of Holders to Receive Principal and any
Premium, Interest and Additional Amounts and to Convert
any Convertible Security. . . . . . . . . . . . . . . . . . 49
Section 509. Restoration of Rights and Remedies. . . . . . . . . . . . . 49
Section 510. Rights and Remedies. . . . . . . . . . . . . . . . . . . . . 49
Section 511. Delay or Omission Not Waiver. . . . . . . . . . . . . . . . 49
Section 512. Control by Holders of Securities. . . . . . . . . . . . . . 50
Section 513. Waiver of Past Defaults. . . . . . . . . . . . . . . . . . . 50
Section 514. Waiver of Stay or Extension Laws. . . . . . . . . . . . . . 51
ARTICLE SIX
THE TRUSTEE
Section 601. Certain Rights of Trustee. . . . . . . . . . . . . . . . . . 51
Section 602. Not Responsible for Recitals or Issuance of Securities. . . 52
Section 603. May Hold Securities. . . . . . . . . . . . . . . . . . . . . 53
Section 604. Money Held in Trust. . . . . . . . . . . . . . . . . . . . . 53
Section 605. Compensation and Reimbursement. . . . . . . . . . . . . . . 53
Section 606. Corporate Trustee Required; Eligibility. . . . . . . . . . . 54
Section 607. Resignation and Removal; Appointment of Successor. . . . . . 54
Section 608. Acceptance of Appointment by Successor. . . . . . . . . . . 56
Section 609. Merger, Conversion, Consolidation or Succession to Business. 58
Section 610. Appointment of Authenticating Agent. . . . . . . . . . . . . 58
ARTICLE SEVEN
HOLDER'S LISTS AND REPORTS BY TRUSTEE AND COMPANY
Section 701. Company to Furnish Trustee Names and Addresses of Holders. . 60
Section 702. Preservation of Information; Communications to Holders. . . 61
iv
<PAGE> 6
Section 703. Reports by Trustee. . . . . . . . . . . . . . . . . . . . . 61
Section 704. Reports by Company. . . . . . . . . . . . . . . . . . . . . 62
ARTICLE EIGHT
CONSOLIDATION, MERGER AND SALES
Section 801. Company May Consolidate, Etc., Only on Certain Terms. . . . 63
Section 802. Successor Person Substituted for Company. . . . . . . . . . 64
ARTICLE NINE
SUPPLEMENTAL INDENTURES
Section 901. Supplemental Indentures without Consent of Holders. . . . . 64
Section 902. Supplemental Indentures with Consent of Holders. . . . . . . 66
Section 903. Execution of Supplemental Indentures. . . . . . . . . . . . 67
Section 904. Effect of Supplemental Indentures. . . . . . . . . . . . . . 67
Section 905. Reference in Securities to Supplemental Indentures. . . . . 67
Section 906. Subordination Unimpaired. . . . . . . . . . . . . . . . . . 68
ARTICLE TEN
COVENANTS
Section 1001. Payment of Principal and any Premium, Interest and
Additional Amounts. . . . . . . . . . . . . . . . . . 68
Section 1002. Maintenance of Office or Agency. . . . . . . . . . . . 68
Section 1003. Money for Securities Payments to Be Held in Trust. . . 70
Section 1004. Additional Amounts. . . . . . . . . . . . . . . . . . . 71
Section 1005. Limitation Upon Disposition of Voting Stock of
Significant Subsidiaries. . . . . . . . . . . . . . . . 72
Section 1006. Limitation on Creation of Liens. . . . . . . . . . . . 73
Section 1007. Corporate Existence. . . . . . . . . . . . . . . . . . 73
Section 1008. Waiver of Certain Covenants. . . . . . . . . . . . . . 74
Section 1009. Company Statement as to Compliance; Notice of
Certain Defaults. . . . . . . . . . . . . . . . . . . 74
v
<PAGE> 7
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
Section 1101. Applicability of Article. . . . . . . . . . . . . . . . 75
Section 1102. Election to Redeem; Notice to Trustee. . . . . . . . . 75
Section 1103. Selection by Trustee of Securities to be Redeemed. . . 75
Section 1104. Notice of Redemption. . . . . . . . . . . . . . . . . . 76
Section 1105. Deposit of Redemption Price. . . . . . . . . . . . . . 78
Section 1106. Securities Payable on Redemption Date. . . . . . . . . 78
Section 1107. Securities Redeemed in Part. . . . . . . . . . . . . . 79
Section 1108. Conversion Arrangements on Call for Redemption. . . . . 79
ARTICLE TWELVE
SINKING FUNDS
Section 1201. Applicability of Article. . . . . . . . . . . . . . . . 80
Section 1202. Satisfaction of Sinking Fund Payments with
Securities. . . . . . . . . . . . . . . . . . . . . . 81
Section 1203. Redemption of Securities for Sinking Fund. . . . . . . 81
ARTICLE THIRTEEN
REPAYMENT AT THE OPTION OF HOLDERS
Section 1301. Applicability of Article. . . . . . . . . . . . . . . . 83
ARTICLE FOURTEEN
SECURITIES IN FOREIGN CURRENCIES
Section 1401. Applicability of Article. . . . . . . . . . . . . . . . 83
vi
<PAGE> 8
ARTICLE FIFTEEN
MEETINGS OF HOLDERS OF SECURITIES
Section 1501. Purposes for Which Meetings May Be Called. . . . . . . 84
Section 1502. Call, Notice and Place of Meetings. . . . . . . . . . . 84
Section 1503. Persons Entitled to Vote at Meetings. . . . . . . . . . 85
Section 1504. Quorum; Action. . . . . . . . . . . . . . . . . . . . . 85
Section 1505. Determination of Voting Rights; Conduct and
Adjournment of Meetings . . . . . . . . . . . . . . . . 86
Section 1506. Counting Votes and Recording Action of Meetings. . . . 87
ARTICLE SIXTEEN
CONVERSION
Section 1601. Conversion Privilege . . . . . . . . . . . . . . . . . 88
Section 1602. Manner of Exercise of Conversion
Privilege . . . . . . . . . . . . . . . . . . . . . . . 88
Section 1603. Cash Adjustment Upon Conversion . . . . . . . . . . . . 89
Section 1604. Conversion Price . . . . . . . . . . . . . . . . . . . 90
Section 1605. Adjustment of Conversion Price . . . . . . . . . . . . 90
Section 1606. Effect of Reclassifications, Consolidations,
Mergers or Sales on Conversion Privilege . . . . . . . 93
Section 1607. Taxes on Conversions . . . . . . . . . . . . . . . . . 94
Section 1608. Company to Reserve Common Stock Privilege . . . . . . . 94
Section 1609. Disclaimer by Trustee of Responsibility
for Certain Matters . . . . . . . . . . . . . . . . . . 94
Section 1610. Company to Give Notice of Certain
Events . . . . . . . . . . . . . . . . . . . . . . . . 95
ARTICLE SEVENTEEN
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS
Section 1701. Indenture and Securities Solely Corporate
Obligations. . . . . . . . . . . . . . . . . . . . . . 99
vii
<PAGE> 9
SENIOR INDENTURE, dated as of _______________ (the "Indenture"),
between Advanta Corp., a corporation duly organized and existing under the
laws of the State of Delaware (hereinafter called the "Company"), having
its principal executive office located at 650 Naamans Road, Claymont,
Delaware 19703, and _______________, a national banking association duly
organized and existing under the laws of the United States (hereinafter
called the "Trustee"), having its Corporate Trust Office located at
________________________.
RECITALS
The Company has duly authorized the execution and delivery of
this Indenture to provide for the issuance from time to time of its
unsecured senior debentures, notes or other evidences of indebtedness
(hereinafter called the "Securities"), unlimited as to principal amount, to
bear such rates of interest, to mature at such time or times, to be issued
in one or more series and to have such other provisions as shall be fixed as
hereinafter provided.
The Company has duly authorized the execution and delivery of
this Indenture. All things necessary to make this Indenture a valid
agreement of the Company, in accordance with its terms, have been done.
This Indenture is subject to the provisions of the Trust Indenture
Act of 1939, as amended, and the rules and regulations of the Securities
and Exchange Commission promulgated thereunder that are required to be
part of this Indenture and, to the extent applicable, shall be governed by
such provisions.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase
of the Securities by the Holders thereof, it is mutually covenanted and
agreed, for the equal and proportionate benefit of all Holders of the
Securities and any Coupons (as hereinafter defined) as follows:
<PAGE> 10
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 101. Definitions.
Except as otherwise expressly provided in or pursuant to this
Indenture or unless the context otherwise requires, for all purposes of this
Indenture:
(1) the terms defined in this Article have the meanings
assigned to them in this Article, and include the plural as well as the
singular;
(2) all other terms used herein which are defined in the
Trust Indenture Act, either directly or by reference therein, have
the meanings assigned to them therein;
(3) all accounting terms not otherwise defined herein
have the meanings assigned to them in accordance with generally
accepted accounting principles and, except as otherwise herein
expressly provided, the term "generally accepted accounting
principles" with respect to any computation required or permitted
hereunder shall mean such accounting principles as are generally
accepted at the date of such computation; and
(4) the words "herein", "hereof", "hereto" and "hereunder" and
other words of similar import refer to this Indenture as a whole and
not to any particular Article, Section or other subdivision.
Certain terms used principally in certain Articles hereof are
defined in those Articles.
"Act", when used with respect to any Holders, has the meaning
specified in Section 104.
"Additional Amounts" means any additional amounts which are
required hereby or by any Security, under circumstances specified herein or
therein, to be paid by the Company in respect of certain taxes imposed on
Holders specified therein and which are owing to such Holders.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or
indirect common control with
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<PAGE> 11
such specified Person. For the purposes of this definition, "control", when
used with respect to any specified Person means the power to direct the
management and policies of such Person, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise; and
the terms "controlling" and "controlled" have the meanings correlative to
the foregoing.
"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 610 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"Authorized Newspaper" means a newspaper, in an official language
of the place of publication or in the English language, customarily published
on each day that is a Business Day in the place of publication, whether or
not published on days that are Legal Holidays in the place of publication,
and of general circulation in each place in connection with which the term is
used or in the financial community of each such place. Where successive
publications are required to be made in Authorized Newspapers, the
successive publications may be made in the same or in different newspapers
in the same city meeting the foregoing requirements and in each case on any
day that is a Business Day in the place of publication.
"Bearer Security" means any Security in the form established
pursuant to Section 201 which is payable to bearer.
"Board of Directors" means the board of directors of the Company
or any committee of that board duly authorized to act generally or in
any particular respect for the Company hereunder.
"Board Resolution" means a copy of one or more resolutions,
certified by the Secretary or an Assistant Secretary of the Company to have
been duly adopted by the Board of Directors and to be in full force and
effect on the date of such certification, delivered to the Trustee.
"Business Day", with respect to any Place of Payment or other
location, means each Monday, Tuesday, Wednesday, Thursday and Friday that
is not a Legal Holiday in such Place of Payment or other location.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Securities Exchange Act of 1934
or, if at any time after the execution of this Indenture such Commission
is not existing and performing the duties now assigned to it under the
Trust Indenture Act, then the body performing such duties at such time.
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"Common Stock" means all shares now or hereafter authorized of any
class of common stock of the Company presently authorized and stock of any
other class into which such shares may hereafter have been changed.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person, and any other obligor upon the
Securities.
"Company Request" and "Company Order" mean, respectively, a
written request or order, as the case may be, signed in the name of the
Company by the Chairman of the Board of Directors, a Vice Chairman, the
President or a Vice President, and by the Treasurer, an Assistant
Treasurer, the Secretary or an Assistant Secretary, of the Company, and
delivered to the Trustee.
"Consolidated Assets" means all assets owned directly by the
Company or indirectly by the Company through any Subsidiary and reflected
on the Company's consolidated balance sheet prepared in accordance with
generally accepted accounting principles.
"Controlled Subsidiary" means each Significant Subsidiary if at
least 80% of the outstanding shares of its Voting Stock is at the time owned
by the Company or by one or more Controlled Subsidiaries of the Company or by
the Company and one or more Controlled Subsidiaries.
"Conversion Price" means the price per share of Common Stock from
time to time in effect at which any Convertible Security may be converted
into Common Stock as determined by or pursuant to the terms of this Indenture.
"Convertible Security" or "Convertible Securities" means any
Security or Securities, as the case may be, which are by their terms
convertible into Common Stock.
"Corporate Trust Office" means the principal office of the
Trustee at which at any particular time its corporate trust business shall
be administered, which office at the date of original execution of this
Indenture is located at the address specified in the first paragraph of this
instrument.
"Corporation" includes corporations and, except for purposes of
Article Eight, associations, companies and business trusts.
"Coupon" means any interest coupon appertaining to a Bearer Security.
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<PAGE> 13
"Currency" or "Money", with respect to any payment, deposit or
other transfer in respect of the principal of or any premium or interest
on or any Additional Amounts with respect to any Security, means the unit
or units of legal tender for the payment of public and private debts (or
any composite thereof) in which such payment, deposit or other transfer is
required to be made by or pursuant to the terms hereof and, with respect to
any other payment, deposit or transfer pursuant to or contemplated by the
terms hereof, means Dollars.
"Currency Indexed Note" means any Security with the amount of
principal payments determined by reference to an index Currency.
"Date of Conversion" with respect to any Convertible Security or
portion thereof to be converted, means the date on which such Convertible
Security shall be surrendered for conversion and notice given in accordance
with the provisions of Article Sixteen.
"Defaulted Interest" has the meaning specified in Section 307.
"Dollars" or "$" means a dollar or other equivalent unit of legal
tender for payment of public or private debts in the United States of America.
"Event of Default" has the meaning specified in Section 501.
"Government Obligations", with respect to any Security, means (i)
direct obligations of the government or governments which issued the Currency
in which the principal of or any premium or interest on such Security or any
Additional Amounts in respect thereof shall be payable, in each case where
the payment or payments thereunder are supported by the full faith and
credit of such government or governments or (ii) obligations of a Person
controlled or supervised by and acting as an agency or instrumentality of
such government or governments, in each case where the payment or payments
thereunder are unconditionally guaranteed as a full faith and credit
obligation by such government or governments, and which, in the case of
(i) or (ii), are not callable or redeemable at the option of the issuer or
issuers thereof, and shall also include a depository receipt issued by a
bank or trust company as custodian with respect to any such Government
Obligation or a specific payment of interest on or principal of or other
amount with respect to any such Government Obligation held by such custodian
for the account of the holder of a depository receipt, provided that (except
as required by law) such custodian is not authorized to make any deduction
from the amount payable to the holder of such depository receipt from any
amount received by the custodian in respect of the Government Obligation
or the specific payment of interest on or principal of or other amount
with respect to the Government Obligation evidenced by such depository
receipt.
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<PAGE> 14
"Holder", in the case of any Registered Security, means the
Person in whose name such Security is registered in the Security Register
and, in the case of any Bearer Security, means the bearer thereof and, in the
case of any Coupon, means the bearer thereof.
"Indenture" means this instrument as it may from time to
time be supplemented or amended by one or more indentures supplemental
hereto entered into pursuant to the applicable provisions hereof and, with
respect to any Security, by the terms and provisions of such Security and
any Coupon appertaining thereto established pursuant to Section 301 (as
such terms and provisions may be amended pursuant to the applicable
provisions hereof).
"Independent Public Accountants" means accountants or a firm
of accountants that, with respect to the Company and any other obligor
under the Securities or the Coupons, are independent public accountants within
the meaning of the Securities Act of 1933, as amended, and the rules and
regulations promulgated by the Commission thereunder, who may be the
independent public accountants regularly retained by the Company or who may
be other independent public accountants. Such accountants or firm shall be
entitled to rely upon any Opinion of Counsel as to the interpretation of any
legal matters relating to the Indenture or certificates required to be
provided hereunder.
"Indexed Security" means a Security the terms of which provide
that the principal amount thereof payable at Stated Maturity and/or
interest to be paid thereon may be determined by reference to the exchange
rate of one or more specified currencies relative to an index or one or
more equity or other indices and/or formulae or the price of one or more
specified commodities or by such other methods or formulae as may be
determined in accordance with this Indenture.
"Interest", with respect to any Original Issue Discount Security
which by its terms bears interest only after Maturity, means interest payable
after Maturity, and, when used with respect to a Security which provides for
payment of Additional Amounts pursuant to Section 1004, includes such
Additional Amounts.
"Interest Payment Date", with respect to any Security, means the
Stated Maturity of an installment of interest on such Security.
"Legal Holiday", with respect to any Place of Payment or other
location, means a Saturday, a Sunday or a day on which banking institutions or
trust companies in such Place of Payment or other location are not
authorized or obligated to be open.
"Maturity", with respect to any Security, means the date on which the
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<PAGE> 15
principal of such Security or an installment of principal becomes due and
payable as provided in or pursuant to this Indenture, whether at the Stated
Maturity or by declaration of acceleration, notice of redemption, notice
of option to elect repayment or otherwise, and includes Redemption Date.
"Office or Agency", with respect to any Securities, means an
office or agency of the Company maintained or designated in a Place of
Payment for such Securities pursuant to Section 1002 or any other office
or agency of the Company maintained or designated for such Securities
pursuant to Section 1002 or, to the extent designated or required by
Section 1002 in lieu of such office or agency, the Corporate Trust Office of
the Trustee.
"Officers' Certificate" means a certificate signed by the Chairman
of the Board, a Vice Chairman, the President or a Vice President, and by the
Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary
of the Company, that complies with the requirements of Section 314(e) of the
Trust Indenture Act and is delivered to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may
be an employee of or counsel for the Company or other counsel who shall
be reasonably acceptable to the Trustee, that complies with the requirements
of Section 314(e) of the Trust Indenture Act.
"Original Issue Discount Security" means a Security issued
pursuant to this Indenture which provides for declaration of an amount less
than the principal face amount thereof to be due and payable upon acceleration
pursuant to Section 502.
"Outstanding", when used with respect to any Securities, means, as
of the date of determination, all such Securities theretofore authenticated
and delivered under this Indenture, except:
(i) any such Security theretofore cancelled by the Trustee
or the Security Registrar or delivered to the Trustee or
the Security Registrar for cancellation;
(ii) any such Security or portions thereof for whose payment
at the Maturity thereof money in the necessary amount has
been theretofore deposited pursuant hereto with the Trustee or
any Paying Agent (other than the Company) in trust or set
aside and segregated in trust by the Company (if the Company
shall act as its own Paying Agent) for the Holders of such
Securities and any Coupons appertaining thereto, provided
that, if such Securities are to be redeemed, notice of such
redemption has been duly
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<PAGE> 16
given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made;
(iii) any such Security with respect to which the Company has
effected defeasance pursuant to Section 402 hereof;
(iv) any such Security which has been paid pursuant to Section 306
or in exchange for or in lieu of which other
Securities have been authenticated and delivered pursuant to
this Indenture, unless there shall have been presented to the
Trustee proof satisfactory to it that such Security is held
by a bona fide purchaser in whose hands such Security is a
valid obligation of the Company; and
(v) Convertible Securities converted into Common Stock in
accordance with Article Sixteen hereof;
provided, however, that in determining whether the Holders of the
requisite principal amount of Outstanding Securities have given any
request, demand, authorization, direction, notice, consent or waiver
hereunder or are present at a meeting of Holders of Securities for quorum
purposes, (i) the principal amount of an Original Issue Discount Security
that may be counted in making such determination and that shall be deemed to
be Outstanding for such purposes shall be equal to the amount of the
principal thereof that pursuant to the terms of such Original Issue Discount
Security would be declared (or shall have been declared to be) due and
payable upon a declaration of acceleration thereof pursuant to Section 502
at the time of such determination, and (ii) the principal amount of any
Indexed Security that may be counted in making such determination and
that shall be deemed outstanding for such purpose shall be equal to the
principal face amount of such Indexed Security at original issuance, unless
otherwise provided in or pursuant to this Indenture, and (iii) Securities
owned by the Company or any other obligor upon the Securities or any
Affiliate of the Company or such other obligor, shall be disregarded and
deemed not to be Outstanding, except that, in determining whether the
Trustee shall be protected in making any such determination or relying upon
any such request, demand, authorization, direction, notice, consent or
waiver, only Securities which a Responsible Officer of the Trustee actually
knows to be so owned shall be so disregarded. Securities so owned which
shall have been pledged in good faith may be regarded as Outstanding if the
pledgee establishes to the satisfaction of the Trustee (A) the pledgee's
right so to act with respect to such Securities and (B) that the pledgee is
not the Company or any other obligor upon the Securities or any Coupons
appertaining thereto or any Affiliate of the Company or such other
obligor.
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<PAGE> 17
"Paying Agent" means any Person authorized by the Company to
pay the principal of, or any premium or interest on, or any Additional
Amounts with respect to any Security or any Coupon on behalf of the Company.
"Person" means any individual, Corporation, partnership, joint
venture, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"Place of Payment", with respect to any Security, means the
place or places where the principal of, or any premium or interest on, or
any Additional Amounts with respect to such Security is payable as provided
in or pursuant to this Indenture.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that
evidenced by such particular Security; and, for the purposes of this
definition, any Security authenticated and delivered under Section 306 in
exchange for or in lieu of a lost, destroyed, mutilated or stolen Security
or any Security to which a mutilated, destroyed, lost or stolen Coupon
appertains shall be deemed to evidence the same debt as the lost, destroyed,
mutilated or stolen Security or the Security to which a mutilated, destroyed,
lost or stolen Coupon appertains.
"Redemption Date", with respect to any Security or portion thereof
to be redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", with respect to any Security or portion thereof
to be redeemed, means the price at which it is to be redeemed as determined by
or pursuant to this Indenture.
"Registered Security" means any Security established pursuant to
Section 201 which is registered in the Security Register.
"Regular Record Date" for the interest payable on any Registered
Security on any Interest Payment Date therefor means the date, if any,
specified in or pursuant to this Indenture as the "Regular Record Date".
"Responsible Officer" means an officer of the Trustee assigned
to the Corporate Trust Office, including any Vice President, any trust officer
or any other officer performing functions similar to those performed by the
persons who at the time shall be such officers, and any other officer of the
Trustee to whom a matter is referred because of his knowledge of and
familiarity with the particular subject.
"Security" or "Securities" means any Security or Securities, as
the case may
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<PAGE> 18
be, authenticated and delivered under this Indenture; provided, however, that,
if at any time there is more than one Person acting as Trustee under
this Indenture, "Securities", with respect to any such Person, shall mean
Securities authenticated and delivered under this Indenture, exclusive,
however, of Securities of any series as to which such Person is not Trustee.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 305.
"Significant Subsidiary" means any Subsidiary of the
Company the Consolidated Assets of which constitute 20% or more of the
Company's Consolidated Assets.
"Special Record Date" for the payment of any Defaulted Interest
on any Registered Security means a date fixed by the Trustee pursuant to
Section 307.
"Stated Maturity", with respect to any Security or any
installment of principal thereof or interest thereon or any Additional
Amounts with respect thereto, means the date established by or pursuant to
this Indenture as the fixed date on which the principal of such Security or
such installment of principal or interest is or such Additional Amounts are
due and payable.
"Subsidiary" means any Corporation of which at the time of
determination the Company or one or more Subsidiaries owns or controls directly
or indirectly more than 50% of the shares of Voting Stock.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended, and any reference herein to the Trust Indenture Act or a
particular provision thereof shall mean such Act or provision, as the case may
be, as amended or replaced from time to time or as supplemented from time
to time by rules or regulations adopted by the Commission under or in
furtherance of the purposes of such Act or provision, as the case may be.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
with respect to one or more series of Securities pursuant to the
applicable provisions of this Indenture, and thereafter "Trustee" shall mean
each Person who is then a Trustee hereunder; provided, however, that if at
any time there is more than one such Person, "Trustee" shall mean each
such Person and as used with respect to the Securities of any series
shall mean the Trustee with respect to the Securities of such series.
"United States", except as otherwise provided herein or in any
Security,
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<PAGE> 19
means the United States of America (including the states thereof and the
District of Columbia), its territories and possessions and other areas
subject to its jurisdiction.
"United States Alien", except as otherwise provided in or pursuant
to this Indenture, means any Person who, for United States Federal income tax
purposes, is a foreign corporation, a non-resident alien individual, a
non-resident alien fiduciary of a foreign estate or trust, or a foreign
partnership one or more of the members of which is, for United States Federal
income tax purposes, a foreign corporation, a non-resident alien individual
or a non-resident alien fiduciary of a foreign estate or trust.
"U.S. Depository" or "Depository" means, with respect to any
Security issuable or issued in the form of one or more global
Securities, the Person designated as U.S. Depository or Depository by the
Company in or pursuant to this Indenture, which Person must be, to the
extent required by applicable law or regulation, a clearing agency
registered under the Securities Exchange Act of 1934, as amended, and, if so
provided with respect to any Security, any successor to such Person. If at
any time there is more than one such Person, "U.S. Depository" or
"Depository" shall mean, with respect to any Securities, the qualifying entity
which has been appointed with respect to such Securities.
"Vice President", when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "Vice President".
"Voting Stock" means stock of a Corporation of the class or classes
having general voting power under ordinary circumstances to elect at least a
majority of the board of directors, managers or trustees of such Corporation
provided that, for the purposes hereof, stock which carries only the right to
vote conditionally on the happening of an event shall not be considered voting
stock whether or not such event shall have happened.
Section 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee to
take any action under any provision of this Indenture, the Company shall
furnish to the Trustee an Officers' Certificate stating that all
conditions precedent, if any, provided for in this Indenture relating to
the proposed action have been complied with and an Opinion of Counsel
stating that, in the opinion of such counsel, all such conditions
precedent, if any, have been complied with, except that in the case of any
such application or request as to which the furnishing of such documents or
any of them is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate
or opinion need be furnished.
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Section 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary
that all such matters be certified by, or covered by the opinion of, only one
such Person, or that they be so certified or covered by only one document,
but one such Person may certify or give an opinion with respect to some
matters and one or more other such Persons as to other matters, and any such
Person may certify or give an opinion as to such matters in one or several
documents.
Any certificate or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or
opinion of, or representations by, counsel, unless such officer knows, or
in the exercise of reasonable care should know, that the certificate or
opinion or representations with respect to the matters upon which his
certificate or opinion is based are erroneous. Any such certificate or
Opinion of Counsel may be based, insofar as it relates to factual matters,
upon a certificate or opinion of, or representations by, an officer or
officers of the Company stating that the information with respect to such
factual matters is in the possession of the Company unless such counsel
knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to such matters are
erroneous.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions
or other instruments under this Indenture or any Security, they may,
but need not, be consolidated and form one instrument.
Section 104. Acts of Holders.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by or pursuant to this Indenture
to be given or taken by Holders may be embodied in and evidenced by one
or more instruments of substantially similar tenor signed by such Holders
in person or by an agent duly appointed in writing. If, but only if,
Securities of a series are issuable as Bearer Securities, any request,
demand, authorization, direction, notice, consent, waiver or other action
provided in or pursuant to this Indenture to be given or taken by Holders
of Securities of such series may, alternatively, be embodied in and evidenced
by the record of Holders of Securities of such series voting in favor
thereof, either in person or by proxies duly appointed in writing, at any
meeting of Holders of Securities of such series duly called and held in
accordance with the provisions of Article Fifteen, or a combination of such
instruments and any such record. Except as herein otherwise expressly
provided, such action shall become effective when such instrument or
instruments or record or both are delivered to the Trustee and, where it is
hereby expressly required, to the Company. Such
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<PAGE> 21
instrument or instruments and any such record (and the action embodied
therein and evidenced thereby) are herein sometimes referred to as the
"Act" of the Holders signing such instrument or instruments or so voting at
any such meeting. Proof of execution of any such instrument or of a writing
appointing any such agent, or of the holding by any Person of a Security,
shall be sufficient for any purpose of this Indenture and (subject to
Section 315 of the Trust Indenture Act) conclusive in favor of the Trustee
and the Company and any agent of the Trustee or the Company, if made in the
manner provided in this Section. The record of any meeting of Holders of
Securities shall be proved in the manner provided in Section 1506.
Without limiting the generality of this Section 104, unless
otherwise provided in or pursuant to this Indenture, a Holder, including a
U.S. Depository that is a Holder of a global Security, may make, give or
take, by a proxy, or proxies, duly appointed in writing, any request,
demand, authorization, direction, notice, consent, waiver or other action
provided in or pursuant to this Indenture to be made, given or taken by
Holders, and a U.S. Depository that is a Holder of a global Security may
provide its proxy or proxies to the beneficial owners of interests in
any such global Security through such U.S. Depository's standing
instructions and customary practices.
The Trustee shall fix a record date for the purpose of
determining the Persons who are beneficial owners of interest in any
permanent global Security held by a U.S. Depository entitled under the
procedures of such U.S. Depository to make, give or take, by a proxy or
proxies duly appointed in writing, any request, demand, authorization,
direction, notice, consent, waiver or other action provided in or pursuant
to this Indenture to be made, given or taken by Holders. If such a record
date is fixed, the Holders on such record date or their duly appointed
proxy or proxies, and only such Persons, shall be entitled to make, give
or take such request, demand, authorization, direction, notice, consent,
waiver or other action, whether or not such Holders remain Holders after such
record date. No such request, demand, authorization, direction, notice,
consent, waiver or other action shall be valid or effective if made, given
or taken more than 90 days after such record date.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved in any reasonable manner which the
Trustee deems sufficient and in accordance with such reasonable rules
as the Trustee may determine; and the Trustee may in any instance require
further proof with respect to any of the matters referred to in this Section
104.
(c) The ownership, principal amount and serial numbers of
Registered Securities held by any Person, and the date of the commencement and
the date of the termination of holding the same, shall be proved by the
Security Register.
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<PAGE> 22
(d) The ownership, principal amount and serial numbers of
Bearer Securities held by any Person, and the date of the commencement and
the date of the termination of holding the same, may be proved by the
production of such Bearer Securities or by a certificate executed, as
depositary, by any trust company, bank, banker or other depositary reasonably
acceptable to the Company, wherever situated, if such certificate shall be
deemed by the Company and the Trustee to be satisfactory, showing that
at the date therein mentioned such Person had on deposit with such
depositary, or exhibited to it, the Bearer Securities therein described; or
such facts may be proved by the certificate or affidavit of the Person
holding such Bearer Securities, if such certificate or affidavit is deemed by
the Trustee to be satisfactory. The Trustee and the Company may assume that
such ownership of any Bearer Security continues until (1) another certificate
or affidavit bearing a later date issued in respect of the same Bearer
Security is produced, or (2) such Bearer Security is produced to the
Trustee by some other Person, or (3) such Bearer Security is surrendered
in exchange for a Registered Security, or (4) such Bearer Security is no
longer Outstanding. The ownership, principal amount and serial numbers of
Bearer Securities held by the Person so executing such instrument or
writing and the date of the commencement and the date of the termination of
holding the same may also be proved in any other manner which the Company
and the Trustee deems sufficient.
(e) If the Company shall solicit from the Holders of any
Registered Securities any request, demand, authorization, direction, notice,
consent, waiver or other Act, the Company may at its option (but is not
obligated to), by Board Resolutions, fix in advance a record date for
the determination of Holders of Registered Securities entitled to give
such request, demand, authorization, direction, notice, consent, waiver
or other Act. If such a record date is fixed, such request, demand,
authorization, direction, notice, consent, waiver or other Act may be given
before or after such record date, but only the Holders of Registered
Securities of record at the close of business on such record date shall be
deemed to be Holders for the purpose of determining whether Holders of
the requisite proportion of Outstanding Securities have authorized or agreed
or consented to such request, demand, authorization, direction, notice,
consent, waiver or other Act, and for that purpose the Outstanding Securities
shall be computed as of such record date; provided that no such
authorization, agreement or consent by the Holders of Registered Securities
shall be deemed effective unless it shall become effective pursuant to the
provisions of this Indenture not later than six months after the record
date.
(f) Any request, demand, authorization, direction, notice,
consent, waiver or other action by the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Security issued
upon the registration of transfer thereof or in exchange therefor or in
lieu thereof in respect of anything done or suffered to be done by the
Trustee, any Security Registrar, any Paying Agent or the Company in
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<PAGE> 23
reliance thereon, whether or not notation of such action is made upon such
Security.
Section 105. Notices, etc. to Trustee and Company.
Any request, demand, authorization, direction, notice, consent,
waiver or Act of Holders or other document provided or permitted by this
Indenture to be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or the Company shall be
sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Trustee at its Corporate Trust Office, or
(2) the Company by the Trustee or any Holder shall be
sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage
prepaid, to the Company addressed to the attention of its Treasurer at
the address of its principal office specified in the first paragraph of
this instrument (with a copy to Five Horsham Business Center, 300 Welsh
Road, Horsham, Pennsylvania 19004, Attention: Secretary) or at any
other address previously furnished in writing to the Trustee by the
Company.
Section 106. Notice to Holders of Securities; Waiver.
Except as otherwise expressly provided in or pursuant to this
Indenture, where this Indenture provides for notice to Holders of Securities of
any event,
(1) such notice shall be sufficiently given to Holders of
Registered Securities if in writing and mailed, first-class postage
prepaid, to each Holder of a Registered Security affected by such
event, at his address as it appears in the Security Register, not
later than the latest date, and not earlier than the earliest
date, prescribed for the giving of such Notice; and
(2) such notice shall be sufficiently given to Holders of
Bearer Securities, if any, if published in an Authorized Newspaper
in The City of New York and, if such Securities are then listed on
any stock exchange outside the United States, in an Authorized
Newspaper in such city as the Company shall advise the Trustee that
such stock exchange so requires, on a Business Day at least
twice, the first such publication to be not earlier than the
earliest date and not later than the latest date prescribed
for the giving of such notice.
In any case where notice to Holders of Registered Securities is
given by mail, neither the failure to mail such notice, nor any defect in
any notice so mailed, to
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any particular Holder of a Registered Security shall affect the sufficiency
of such notice with respect to other Holders of Registered Securities or the
sufficiency of any notice to Holders of Bearer Securities given as provided
herein. Any notice which is mailed in the manner herein provided shall be
conclusively presumed to have been duly given or provided. In the case by
reason of the suspension of regular mail service or by reason of any other
cause it shall be impracticable to give such notice by mail, then such
notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.
In case by reason of the suspension of publication of any
Authorized Newspaper or Authorized Newspapers or by reason of any other
cause it shall be impracticable to publish any notice to Holders of
Bearer Securities as provided above, then such notification to Holders of
Bearer Securities as shall be given with the approval of the Trustee shall
constitute sufficient notice to such Holders for every purpose hereunder.
Neither failure to give notice by publication to Holders of Bearer
Securities as provided above, nor any defect in any notice so published,
shall affect the sufficiency of any notice mailed to Holders of
Registered Securities as provided above.
Where this Indenture provides for notice in any manner, such notice
may be waived in writing by the Person entitled to receive such notice,
either before or after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Holders of Securities shall be filed with
the Trustee, but such filing shall not be a condition precedent to the
validity of any action taken in reliance upon such waiver.
Section 107. Language of Notices.
Any request, demand, authorization, direction, notice, consent,
election or waiver required or permitted under this Indenture shall be
in the English language, except that, if the Company so elects, any
published notice may be in an official language of the country of publication.
Section 108. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with any
duties under any required provision of the Trust Indenture Act imposed
hereon by Section 318(c) thereof, such required provision shall control.
Section 109. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents
are for convenience only and shall not affect the construction hereof.
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Section 110. Successors and Assigns.
All covenants and agreements in this Indenture by the Company shall
bind its successors and assigns, whether so expressed or not.
Section 111. Separability Clause.
In case any provision in this Indenture, any Security or any Coupon
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
Section 112. Benefits of Indenture.
Nothing in this Indenture, any Security or any Coupon, express or
implied, shall give to any Person, other than the parties hereto, any Security
Registrar, any Paying Agent and their successors hereunder and the
Holders of Securities or Coupons, any benefit or any legal or equitable
right, remedy or claim under this Indenture.
Section 113. Governing Law.
This Indenture, the Securities and any Coupons shall be governed
by and construed in accordance with the laws of the State of New York
applicable to agreements made or instruments entered into and, in each
case, performed in said state.
Section 114. Legal Holidays
In any case where any Interest Payment Date, Stated Maturity or
Maturity of any Security, or the last date on which a Holder has the right
to convert his Securities shall be a Legal Holiday at any Place of Payment,
then (notwithstanding any other provision of this Indenture, any Security
or any Coupon other than a provision in any Security or Coupon that
specifically states that such provision shall apply in lieu of this
Section 114) payment or conversion of the Securities need not be made at
such Place of Payment on such date, but may be made on the next succeeding day
that is a Business Day at such Place of Payment with the same force and
effect as if made on the Interest Payment Date or at the Stated Maturity
or Maturity, or on the last such date for conversion, and no interest shall
accrue on the amount payable on such date or at such time for the period
from and after such Interest Payment Date or Stated Maturity or Maturity,
or last such date for conversion, as the case may be.
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ARTICLE TWO
SECURITIES FORMS
Section 201. Forms Generally.
Each Registered Security, Bearer Security, Coupon and temporary global
Security issued pursuant to this Indenture shall be in the form established by
or pursuant to a Board Resolution or in one or more indentures supplemental
hereto, shall have such appropriate insertions, omissions, substitutions and
other variations as are required or permitted by or pursuant to this Indenture
or any indenture supplemental hereto and may have such letters, numbers or
other marks of identification and such legends or endorsements placed thereon
as may, consistently herewith, be determined by the officers executing such
Security or Coupon as evidenced by their execution of such Security or Coupon.
Unless otherwise provided in or pursuant to this Indenture, the Securities
shall be issuable in registered form without Coupons.
Definitive Securities and definitive Coupons shall be printed,
lithographed or engraved or produced by any combination of these methods on a
steel engraved border or steel engraved borders or may be produced in any other
manner, all as determined by the officers of the Company executing such
Securities or Coupons, as evidenced by their execution of such Securities or
Coupons.
Section 202. Form of Trustee's Certificate of Authentication.
Subject to Section 610, the Trustee's certificate of authentication shall be
in substantially the following form:
This is one of the Securities of the series designated herein referred to
in the within-mentioned Indenture.
____________________, as Trustee
By______________________________
Authorized Officer
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Section 203. Securities in Global Form.
If Securities of a series shall be issuable in global form, any such
Security may provide that it or any number of such Securities shall represent
the aggregate amount of all Outstanding Securities of such series (or such
lesser amount as is permitted by the terms thereof) from time to time endorsed
thereon and may also provide that the aggregate amount of Outstanding
Securities represented thereby may from time to time be increased or reduced to
reflect exchanges. Any endorsement of any Security in global form to reflect
the amount, or any increase or decrease in the amount, or changes in the rights
of Holders, of Outstanding Securities represented thereby shall be made in such
manner and by such Person or Persons as shall be specified therein or in the
Company Order to be delivered pursuant to Section 303 or 304 with respect
thereto. Subject to the provisions of Section 303 and, if applicable, Section
304, the Trustee shall deliver and redeliver any Security in permanent global
form in the manner and upon instructions given by the Person or Persons
specified therein or in the applicable Company Order. If a Company Order
pursuant to Section 303 or 304 has been, or simultaneously is, delivered, any
instructions by the Company with respect to a Security in global form shall be
in writing but need not be accompanied by or contained in an Officers'
Certificate and need not be accompanied by an Opinion of Counsel.
ARTICLE THREE
THE SECURITIES
Section 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is unlimited. The Securities may be issued in
one or more series.
With respect to any Securities to be authenticated and delivered hereunder,
there shall be established in or pursuant to a Board Resolution and set forth
in an Officers' Certificate, or established in one or more indentures
supplemental hereto,
(1) the title of such Securities and the series in which such Securities
shall be included;
(2) any limit upon the aggregate principal amount of the Securities of
such title or the Securities of such series which may be authenticated and
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delivered under this Indenture (except for Securities authenticated and
delivered upon registration or transfer of, or in exchange for, or in lieu
of, other Securities of such series pursuant to Section 304, 305, 306, 905,
1107 or 1602 or the terms of such Securities);
(3) whether such Securities are to be issuable as Registered Securities,
as Bearer Securities or alternatively as Bearer Securities and Registered
Securities, and whether the Bearer Securities are to be issuable with
Coupons, without Coupons or both, and any restrictions applicable to the
offer, sale, delivery or conversion of the Bearer Securities and the terms,
if any, upon which Bearer Securities may be exchanged for Registered
Securities and vice versa;
(4) if any of such Securities are to be issuable in global form, when any
of such Securities are to be issuable in global form and (i) whether
beneficial owners of interests in any such global Security may exchange such
interest for Securities of the same series and of like tenor and of any
authorized form and denomination, and the circumstances under which any such
exchanges may occur, if other than in the manner specified in Section 305,
and (ii) the name of the Depository or the U.S. Depository, as the case may
be, with respect to any global Security;
(5) if any of such Securities are to be issuable as Bearer Securities or
in global form, the date as of which any such Bearer Security or global
Security shall be dated (if other than the date of original issuance of the
first of such Securities to be issued);
(6) if any of such Securities are to be issuable as Bearer Securities,
whether interest in respect of any portion of a temporary Bearer Security in
global form payable in respect of an Interest Payment Date therefor prior to
the exchange, if any, of such temporary Bearer Security for definitive
Securities shall be paid to any clearing organization with respect to the
portion of such temporary Bearer Security held for its account and, in such
event, the terms and conditions (including any certification requirements)
upon which any such interest payment received by a clearing organization will
be credited to the Persons entitled to interest payable on such Interest
Payment Date;
(7) the date or dates, or the method or methods, if any, by which such
date or dates shall be determined, on which the principal of such Securities
is payable;
(8) the rate or rates at which such Securities shall bear interest, if
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any, or the method or methods, if any, by which such rate or rates are to be
determined, the date or dates, if any, from which such interest shall accrue
or the method or methods, if any, by which such date or dates are to be
determined, the Interest Payment Dates, if any, on which such interest shall
be payable and the Regular Record Date, if any, for the interest payable on
Registered Securities on any Interest Payment Date, whether and under what
circumstances Additional Amounts on such Securities or any of them shall be
payable, and the basis upon which interest shall be calculated if other than
that of a 360-day year of twelve 30-day months;
(9) if in addition to or other than The City of New York, the place or
places where the principal of, any premium and interest on or any Additional
Amounts with respect to such Securities shall be payable, any of such
Securities that are Registered Securities may be surrendered for registration
of transfer, any of such Securities may be surrendered for exchange or
conversion and notices or demands to or upon the Company in respect of such
Securities and this Indenture may be served;
(10) whether any of such Securities are to be redeemable at the option of
the Company and, if so, the period or periods within which, the price or
prices at which and the other terms and conditions upon which such Securities
may be redeemed, in whole or in part, at the option of the Company;
(11) whether the Company is obligated to redeem or purchase any of such
Securities pursuant to any sinking fund or at the option of any Holder
thereof and, if so, the period or periods within which, the price or prices
at which and the other terms and conditions upon which such Securities shall
be redeemed or purchased, in whole or in part, pursuant to such obligation,
and any provisions for the remarketing of such Securities so redeemed or
purchased;
(12) the denominations in which any of such Securities that are Registered
Securities shall be issuable if other than denominations of $1,000 and any
integral multiple thereof, and the denominations in which any of such
Securities that are Bearer Securities shall be issuable if other than the
denomination of $5,000;
(13) if other than the principal amount thereof, the portion of the
principal amount of any of such Securities that shall be payable upon
declaration of acceleration of the Maturity thereof pursuant to Section 501
or the method by which such portion is to be determined;
(14) if other than Dollars, the Currency in which payment of the
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principal of, any premium or interest on or any Additional Amounts with
respect to any of such Securities shall be payable;
(15) if the principal of, any premium or interest on or any Additional
Amounts with respect to any of such Securities are to be payable, at the
election of the Company or a Holder thereof or otherwise, in a Currency other
than that in which such Securities are stated to be payable, the period or
periods within which, and the other terms and conditions upon which, such
election may be made, and the time and manner of determining the exchange
rate between the Currency in which such Securities are denominated or stated
to be payable and the Currency in which such Securities or any of them are to
be so payable;
(16) whether the amount of payments of principal of, any premium or
interest on or any Additional Amounts with respect to such Securities may be
determined with reference to an index, formula or other method (which index,
formula or method or methods may be based, without limitation, on one or more
Currencies, commodities, equity indices or other indices), and, if so, the
terms and conditions upon which and the manner in which such amounts shall be
determined and paid or payable;
(17) any deletions from, modifications of or additions to the Events of
Default or covenants of the Company with respect to any of such Securities,
whether or not such Events of Default or covenants are consistent with the
Events of Default or covenants set forth herein;
(18) the applicability, if any, of Section 402 to any of such Securities
and any provisions in modification of, in addition to or in lieu of any of
the provisions of Section 402;
(19) if any of such Securities are to be issuable upon the exercise of
warrants, this shall be so established and (if established by Board
Resolution) so set forth, as well as the time, manner and place for such
Securities to be authenticated and delivered;
(20) whether Securities of the series are to be Convertible Securities
and, if so, the initial Conversion Price applicable thereto, the period or
periods within which the conversion privilege may be exercised, the class of
Common Stock into which such Convertible Securities may be converted and any
additions, deletions, modifications or variations to the provisions of
Article Sixteen hereof applicable thereto;
(21) whether the principal of (and premium, if any) or interest
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(including Additional Amounts), if any, on the Securities of the series are
to be payable, at the election of the Company or any Holder thereof or
otherwise, in a currency or currencies, currency unit or units or composite
currency or currencies other than that in which such Securities or any of
them are denominated or stated to be payable, the period or periods within
which, and the other terms and conditions upon which, such election, if any,
may be made, and the time and manner of determining the exchange rate between
the currency or currencies, currency unit or units or composite currency or
currencies in which such Securities or any of them are denominated or stated
to be payable and the currency or currencies, currency unit or units or
composite currency or currencies in which such Securities or any of them are
to be so payable;
(22) if any of such Securities are to be issuable in global form and are
to be issuable in definitive form (whether upon original issue or upon
exchange of a temporary Security) only upon receipt of certain certificates
or other documents or satisfaction of other conditions, then the form and
terms of such certificates, documents or conditions;
(23) if there is more than one Trustee, the identity of the Trustee and,
if not the Trustee, the identity of each Security Registrar, Paying Agent or
Authenticating Agent with respect to such Securities;
(24) any other terms of such Securities (which terms shall not be
inconsistent with the provisions of this Indenture).
All Securities of any one series and all Coupons, if any, appertaining to
Bearer Securities of such series shall be substantially identical except as to
Currency of payments due thereunder, denomination and the rate or rates of
interest, if any, and Maturity, the date from which interest, if any, shall
accrue and except as may otherwise be provided by the Company in or pursuant to
the Board Resolution and set forth in the Officers' Certificate or in any
indenture or indentures supplemental hereto pertaining to such series of
Securities. All Securities of any one series need not be issued at the same
time and, unless otherwise so provided by the Company, a series may be reopened
for issuances of additional Securities of such series or to establish
additional terms of such series of Securities.
If any of the terms of the Securities of any series shall be established by
action taken by or pursuant to a Board Resolution, the Board Resolution shall
be delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of such series.
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Section 302. Currency; Denominations.
Unless otherwise provided in or pursuant to this Indenture, the principal
of, any premium and interest on and any Additional Amounts with respect to the
Securities shall be payable in Dollars. Unless otherwise provided in or
pursuant to this Indenture, Registered Securities denominated in Dollars shall
be issuable in registered form without Coupons in denominations of $1,000 and
any integral multiple thereof, and the Bearer Securities denominated in Dollars
shall be issuable in the denomination of $5,000. Securities not denominated in
Dollars shall be issuable in such denominations as are established with respect
to such Securities in or pursuant to this Indenture.
Section 303. Execution, Authentication, Delivery and Dating.
Securities shall be executed on behalf of the Company by its Chairman of the
Board, one of its Vice Chairmen, its President, its Treasurer or one of its
Vice Presidents under its corporate seal reproduced thereon and attested by its
Secretary or one of its Assistant Secretaries. Coupons shall be executed on
behalf of the Company by the Treasurer or any Assistant Treasurer of the
Company. The signature of any of these officers on the Securities or any
Coupons appertaining thereto may be manual or facsimile.
Securities and any Coupons appertaining thereto bearing the manual or
facsimile signatures of individuals who were at any time the proper officers of
the Company shall bind the Company, notwithstanding that such individuals or
any of them have ceased to hold such offices prior to the authentication and
delivery of such Securities or did not hold such offices at the date of such
Securities.
At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Securities, together with any Coupons
appertaining thereto, executed by the Company, to the Trustee for
authentication, together with the Board Resolution and Officers' Certificate or
supplemental indenture with respect to such Securities referred to in Section
301 and a Company Order for the authentication and delivery of such Securities,
and the Trustee in accordance with the Company Order and subject to the
provisions hereof shall authenticate and deliver such Securities. In
authenticating such Securities, and accepting the additional responsibilities
under this Indenture in relation to such Securities and any Coupons
appertaining thereto, the Trustee shall be entitled to receive, and (subject to
Article Six hereof) shall be fully protected in relying upon an Opinion of
Counsel substantially to the effect that:
(a) the form or forms and terms of such Securities and Coupons,
if any, have been established in conformity with the provisions of
this Indenture;
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(b) all conditions precedent to the authentication and
delivery of such Securities and Coupons, if any, appertaining thereto,
have been complied with and that such Securities, and Coupons, when
completed by appropriate insertion and executed and delivered by the
Company to the Trustee for authentication pursuant to this Indenture,
and authenticated and delivered by the Trustee and issued by the
Company in the manner and subject to any conditions specified in such
Opinion of Counsel, will constitute legally valid and binding
obligations of the Company, enforceable against the Company in
accordance with their terms, subject to bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer or other similar laws
affecting the enforcement of creditors' rights generally, and subject
to general principles of equity (regardless of whether enforcement is
sought in a proceeding in equity or at law) and except further as
enforcement thereof may be limited by (A) requirements that a claim
with respect to any securities denominated other than in Dollars (or a
foreign currency or foreign currency unit judgment in respect of such
claim) be converted into Dollars at a rate of exchange prevailing on a
date determined pursuant to applicable law or (B) governmental
authority to limit, delay or prohibit the making of payments in
foreign currency or currency units or payments outside the United
States; and will entitle the Holders thereof to the benefits of this
Indenture; such Opinion of Counsel need express no opinion as to the
availability of equitable remedies;
(c) all laws and requirements in respect of the execution and
delivery by the Company of such Securities and Coupons, if any, have
been complied with; and
(d) as to such other matters as the Trustee may reasonably
request.
If all the Securities of any series are not to be issued at one time, it
shall not be necessary to deliver an Opinion of Counsel and an Officers'
Certificate at the time of issuance of each Security, but such opinion and
certificate, with appropriate modifications, shall be delivered at or before
the time of issuance of the first Security of such series. After any such
first delivery, any separate request by the Company that the Trustee
authenticate Securities of such series for original issue will be deemed to be
a certification by the Company that all conditions precedent provided for in
this Indenture relating to authentication and delivery of such Securities
continue to have been complied with.
The Trustee shall not be required to authenticate or to cause an
Authenticating Agent to authenticate any Securities if the issue of such
Securities pursuant to this Indenture will affect the Trustee's own rights,
duties or immunities under the Securities and this Indenture or otherwise in a
manner which is not reasonably
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acceptable to the Trustee or if the Trustee, being advised by counsel,
determines that such action may not lawfully be taken.
Each Registered Security shall be dated the date of its authentication.
Each Bearer Security and any temporary Bearer Security in global form shall be
dated as of the date specified in or pursuant to this Indenture.
No Security or Coupon appertaining thereto shall be entitled to any benefit
under this Indenture or be valid or obligatory for any purpose, unless there
appears on such Security a certificate of authentication substantially in the
form provided for in Section 202 or 610 executed by or on behalf of the Trustee
by the manual signature of one of its authorized officers or by an
Authenticating Agent. Such certificate upon any Security shall be conclusive
evidence, and the only evidence, that such Security has been duly authenticated
and delivered hereunder. Except as permitted by Section 306 or 307, the
Trustee shall not authenticate and deliver any Bearer Security unless all
Coupons appertaining thereto then matured have been detached and cancelled.
Section 304. Temporary Securities.
Pending the preparation of definitive Securities, the Company may execute
and deliver to the Trustee and, upon Company Order, the Trustee shall
authenticate and deliver, in the manner provided in Section 303, temporary
Securities in lieu thereof which are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities in lieu of which they
are issued, in registered form or, if authorized in or pursuant to this
Indenture, in bearer form with one or more Coupons or without Coupons and with
such appropriate insertions, omissions, substitutions and other variations as
the officers of the Company executing such Securities may determine, as
conclusively evidenced by their execution of such Securities. Such temporary
Securities may be in global form.
Except in the case of temporary Securities in global form, which shall be
exchanged in accordance with the provisions thereof, if temporary Securities
are issued, the Company shall cause definitive Securities to be prepared
without unreasonable delay. After the preparation of definitive Securities of
the same series and containing terms and provisions that are identical to those
of any temporary Securities, such temporary Securities shall be exchangeable
for such definitive Securities upon surrender of such temporary Securities at
an Office or Agency for such Securities, without charge to any Holder thereof.
Upon surrender for cancellation of any one or more temporary Securities
(accompanied by any unmatured Coupons appertaining thereto), the Company shall
execute and the Trustee shall authenticate and deliver in exchange therefor a
like principal amount of definitive Securities of authorized denominations of
the same series and containing identical terms and provisions; provided,
however, that
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no definitive Bearer Security, except as provided in or pursuant to this
Indenture, shall be delivered in exchange for a temporary Registered Security;
and provided, further, that a definitive Bearer Security shall be delivered in
exchange for a temporary Bearer Security only in compliance with the conditions
set forth in or pursuant to this Indenture. Unless otherwise provided in or
pursuant to this Indenture with respect to a temporary global Security, until
so exchanged the temporary Securities of any series shall in all respects be
entitled to the same benefits under this Indenture as definitive Securities of
such series.
Section 305. Registration, Transfer and Exchange.
With respect to the Registered Securities of each series, if any, the
Company shall cause to be kept a register (each such register being herein
sometimes referred to as the "Security Register") at an Office or Agency for
such series in which, subject to such reasonable regulations as it may
prescribe, the Company shall provide for the registration of the Registered
Securities of such series and of transfers of the Registered Securities of such
series. In the event that the Trustee shall not be the Security Registrar, it
shall have the right to examine the Security Register at all reasonable times.
The Trustee is hereby initially appointed as Security Registrar for each series
of Securities. In the event that the Trustee shall cease to be Security
Registrar with respect to a series of Securities, it shall have the right to
examine the Security Register for such series at all reasonable times.
Upon surrender for registration of transfer of any Registered Security of
any series at any Office or Agency for such series, the Company shall execute,
and the Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Registered Securities of the same
series denominated as authorized in or pursuant to this Indenture, of a like
aggregate principal amount bearing a number not contemporaneously outstanding
and containing identical terms and provisions.
At the option of the Holder, Registered Securities of any series may be
exchanged for other Registered Securities of the same series containing
identical terms and provisions, in any authorized denominations, and of a like
aggregate principal amount, upon surrender of the Securities to be exchanged at
any Office or Agency for such series. Whenever any Registered Securities are
so surrendered for exchange, the Company shall execute, and the Trustee shall
authenticate and deliver, the Registered Securities which the Holder making the
exchange is entitled to receive.
If provided in or pursuant to this Indenture, with respect to Securities of
any series, at the option of the Holder, Bearer Securities of such series may
be exchanged for Registered Securities of such series containing identical
terms,
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denominated as authorized in or pursuant to this Indenture and in the same
aggregate principal amount, upon surrender of the Bearer Securities to be
exchanged at any Office or Agency for such series, with all unmatured Coupons
and all matured Coupons in default thereto appertaining. If the Holder of a
Bearer Security is unable to produce any such unmatured Coupon or Coupons or
matured Coupon or Coupons in default, such exchange may be effected if the
Bearer Securities are accompanied by payment in funds acceptable to the Company
and the Trustee in an amount equal to the face amount of such missing Coupon or
Coupons, or the surrender of such missing Coupon or Coupons may be waived by
the Company and the Trustee if there is furnished to them such security or
indemnity as they may require to save each of them and any Paying Agent
harmless. If thereafter the Holder of such Bearer Security shall surrender to
any Paying Agent any such missing Coupon in respect of which such a payment
shall have been made, such Holder shall be entitled to receive the amount of
such payment; provided, however, that, except as otherwise provided in Section
1002, interest represented by Coupons shall be payable only upon presentation
and surrender of those Coupons at an Office or Agency for such series located
outside the United States. Notwithstanding the foregoing, in case a Bearer
Security of any series is surrendered at any such Office or Agency for such
series in exchange for a Registered Security of such series and like tenor
after the close of business at such Office or Agency on (i) any Regular Record
Date and before the opening of business at such Office or Agency on the
relevant Interest Payment Date, or (ii) any Special Record Date and before the
opening of business at such Office or Agency on the related date for payment of
Defaulted Interest, such Bearer Security shall be surrendered without the
Coupon relating to such Interest Payment Date or proposed date of payment, as
the case may be (or, if such Coupon is so surrendered with such Bearer
Security, such Coupon shall be returned to the Person so surrendering the
Bearer Security), and interest or Defaulted Interest, as the case may be, shall
not be payable on such Interest Payment Date or proposed date for payment, as
the case may be, in respect of the Registered Security issued in exchange for
such Bearer Security, but shall be payable only to the Holder of such Coupon
when due in accordance with the provisions of this Indenture.
If expressly provided with respect to Securities of any series, at the
option of the Holder, Registered Securities of such series may be exchanged for
Bearer Securities upon such terms and conditions as may be provided with
respect to such series.
Whenever any Securities are surrendered for exchange as contemplated by the
immediately preceding two paragraphs, the Company shall execute, and the
Trustee shall authenticate and deliver, the Securities which the Holder making
the exchange is entitled to receive.
Notwithstanding the foregoing, except as otherwise provided in or pursuant
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to this Indenture, any global Security shall be exchangeable for definitive
Securities only if (i) the Depository is at any time unwilling, unable
or ineligible to continue as Depository and a successor depository is not
appointed by the Company within 60 days of the date the Company is so
informed in writing, (ii) the Company executes and delivers to the Trustee a
Company Order to the effect that such global Security shall be so exchangeable,
or (iii) an Event of Default has occurred and is continuing with respect to
the Securities. If the beneficial owners of interests in a global Security are
entitled to exchange such interests for definitive Securities, then without
unnecessary delay but in any event not later than the earliest date on which
such interests may be so exchanged, the Company shall deliver to the Trustee
definitive Securities in such form and denominations as are required by or
pursuant to this Indenture, and of the same series, containing identical terms
and in aggregate principal amount equal to the principal amount of, such global
Security, executed by the Company. On or after the earliest date on which such
interests may be so exchanged, such global Security shall be surrendered from
time to time by the U.S. Depository or such other Depository as shall be
specified in the Company Order with respect thereto, and in accordance with
instructions given to the Trustee and the U.S. Depository or such other
Depository, as the case may be (which instructions shall be in writing but need
not be contained in or accompanied by an Officers' Certificate or be
accompanied by an Opinion of Counsel), as shall be specified in the Company
Order with respect thereto to the Trustee, as the Company's agent for such
purpose, to be exchanged, in whole or in part, for definitive Securities as
described above without charge. The Trustee shall authenticate and make
available for delivery, in exchange for each portion of such surrendered
global Security, a like aggregate principal amount of definitive Securities of
the same series of authorized denominations and of like tenor as the portion of
such global Security to be exchanged, which (unless such Securities are not
issuable both as Bearer Securities and as Registered Securities, in which case
the definitive Securities exchanged for the global Security shall be issuable
only in the form in which the Securities are issuable, as provided in or
pursuant to this Indenture) shall be in the form of Bearer Securities or
Registered Securities, or any combination thereof, as shall be specified by the
beneficial owner thereof; provided, however, that no such exchanges may occur
during a period beginning at the opening of business 15 days before any
selection of Securities of the same series and continuing identical terms to be
redeemed and ending on the relevant Redemption Date; and provided, further,
that (unless otherwise provided in or pursuant to this Indenture) no Bearer
Security delivered in exchange for a portion of a global Security shall be
mailed or otherwise delivered to any location in the United States. Promptly
following any such exchange in part, such global Security shall be returned by
the Trustee to such Depository or the U.S. Depository, as the case may be, or
such other Depository or U.S. Depository referred to above in accordance with
the instructions of the Company referred to above. If a Registered Security is
issued in exchange for any portion of a global Security after the close of
business at the Office or Agency for such Security where such exchange occurs
on or after (i) any Regular Record Date for such
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Security and before the opening of business at such Office or Agency on the
next Interest Payment Date, or (ii) any Special Record Date for such Security
and before the opening of business at such Office or Agency on the related
proposed date for payment of interest or Defaulted Interest, as the case may
be, interest shall not be payable on such Interest Payment Date or proposed
date for payment, as the case may be, in respect of such Registered Security,
but shall be payable on such Interest Payment Date or proposed date for
payment, as the case may be, only to the Person to whom interest in respect of
such portion of such global Security shall be payable in accordance with the
provisions of this Indenture.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company evidencing the same
debt and entitling the Holders thereof to the same benefits under this
Indenture as the Securities surrendered upon such registration of transfer or
exchange.
Every Registered Security presented or surrendered for registration of
transfer or for exchange, redemption or conversion shall (if so required by the
Company or the Security Registrar for such Security) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar for such Security duly executed by the
Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange, redemption or conversion of Securities, but the Company may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any registration of transfer or exchange of
Securities, other than exchanges pursuant to Section 304, 905 or 1107 not
involving any transfer.
Except as otherwise provided in or pursuant to this Indenture, the Company
shall not be required (i) to issue, register the transfer of or exchange any
Securities during a period beginning at the opening of business 15 days before
the day of the selection for redemption of Securities of like tenor and the
same series under Section 1103 and ending at the close of business (A) if
Securities of the series are issuable only as Registered Securities, on the day
of the mailing of the relevant notice of redemption, and (B) if Securities of
the series are issuable as Bearer Securities, on the day of the first
publication of the relevant notice of redemption or, if Securities of the
series are also issuable as Registered Securities and there is no publication,
the mailing of the relevant notice of redemption, or (ii) to register the
transfer of or exchange any Registered Security so selected for redemption in
whole or in part, except in the case of any Security to be redeemed in part,
the portion thereof not to be redeemed, or (iii) to exchange any Bearer
Security so selected for redemption except, to the extent provided with respect
to such Bearer Security, that such Bearer Security may be exchanged for
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a Registered Security of like tenor and the same series, provided that such
Registered Security shall be immediately surrendered for redemption with
written instruction for payment consistent with the provisions of this
Indenture or (iv) to issue, register the transfer of or exchange any Security
which, in accordance with its terms, has been surrendered for repayment at the
option of the Holder, except the portion, if any, of such Security not to be so
repaid.
Section 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security or a Security with a mutilated Coupon
appertaining to it is surrendered to the Trustee, subject to the provisions of
this Section 306, the Company shall execute and the Trustee shall authenticate
and deliver in exchange therefor a new Security of the same series containing
identical terms and of like principal amount and bearing a number not
contemporaneously outstanding, with Coupons appertaining thereto corresponding
to the Coupons, if any, appertaining to the surrendered Security.
If there be delivered to the Company and to the Trustee (i) evidence to
their satisfaction of the destruction, loss or theft of any Security or Coupon,
and (ii) such security or indemnity as may be required by them to save each of
them and any agent of either of them harmless, then, in the absence of notice
to the Company or the Trustee that such Security or Coupon has been acquired by
a bona fide purchaser, the Company shall execute and, upon the Company's
request the Trustee shall authenticate and deliver, in exchange for or in lieu
of any such mutilated, destroyed, lost or stolen Security or in exchange for
the Security to which a destroyed, lost or stolen Coupon appertains with all
appurtenant Coupons not destroyed, lost or stolen, a new Security of the same
series containing identical terms and of like principal amount and bearing a
number not contemporaneously outstanding, with Coupons corresponding to the
Coupons, if any, appertaining to such destroyed, lost or stolen Security or to
the Security to which such destroyed, lost or stolen Coupon appertains.
Notwithstanding the foregoing provisions of this Section 306, in case any
mutilated, destroyed, lost or stolen Security or Coupon has become or is about
to become due and payable, the Company in its discretion may, instead of
issuing a new Security, pay such Security or Coupon; provided, however, that
payment of principal of, any premium or interest on or any Additional Amounts
with respect to any Bearer Securities shall, except as otherwise provided in
Section 1002, be payable only at an Office or Agency for such Securities
located outside the United States and, unless otherwise provided in or pursuant
to this Indenture, any interest on Bearer Securities and any Additional Amounts
with respect to such interest shall be payable only upon presentation and
surrender of the Coupons appertaining thereto.
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Upon the issuance of any new Security under this Section 306, the Company
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security, with any Coupons appertaining thereto issued pursuant to
this Section in lieu of any destroyed, lost or stolen Security, or in exchange
for a Security to which a destroyed, lost or stolen Coupon appertains shall
constitute a separate obligation of the Company, whether or not the destroyed,
lost or stolen Security and Coupons appertaining thereto or the destroyed, lost
or stolen Coupon shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities of such series and any Coupons, if any, duly
issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities or Coupons.
Section 307. Payment of Interest and Certain Additional Amounts; Rights to
Interest and Certain Additional Amounts Preserved.
Unless otherwise provided in or pursuant to this Indenture, any interest on
and any Additional Amounts with respect to any Registered Security which shall
be payable, and are punctually paid or duly provided for, on any Interest
Payment Date shall be paid to the Person in whose name such Security (or one or
more Predecessor Securities) is registered as of the close of business on the
Regular Record Date for such interest. Unless otherwise provided in or
pursuant to this Indenture, in case a Bearer Security is surrendered in
exchange for a Registered Security after the close of business at an Office or
Agency for such Security on any Regular Record Date therefor and before the
opening of business at such Office or Agency on the next succeeding Interest
Payment Date therefor, such Bearer Security shall be surrendered without the
Coupon relating to such Interest Payment Date and interest shall not be payable
on such Interest Payment Date in respect of the Registered Security issued in
exchange for such Bearer Security, but shall be payable only to the Holder of
such Coupon when due in accordance with the provisions of this Indenture.
Unless otherwise provided in or pursuant to this Indenture, any interest on
and any Additional Amounts with respect to any Registered Security which shall
be payable, but shall not be punctually paid or duly provided for, on any
Interest Payment Date for such Registered Security (herein called "Defaulted
Interest") shall forthwith cease to be payable to the Holder thereof on the
relevant Regular Record Date by virtue of having been such Holder; and such
Defaulted Interest may be paid by the Company, at
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its election in each case, as provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest to
the Person in whose name such Registered Security (or a Predecessor Security
thereof) shall be registered at the close of business on a Special Record
Date for the payment of such Defaulted Interest, which shall be fixed in the
following manner. The Company shall notify the Trustee in writing of the
amount of Defaulted Interest proposed to be paid on such Registered Security
and the date of the proposed payment, and at the same time the Company shall
deposit with the Trustee an amount of money equal to the aggregate amount
proposed to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit on or prior to the
date of the proposed payment, such money when so deposited to be held in
trust for the benefit of the Person entitled to such Defaulted Interest as in
this Clause provided. Thereupon, the Trustee shall fix a Special Record Date
for the payment of such Defaulted Interest which shall be not more than 15
days and not less than 10 days prior to the date of the proposed payment and
not less than 10 days after the receipt by the Trustee of the notice of the
proposed payment. The Trustee shall promptly notify the Company of such
Special Record Date and, in the name and at the expense of the Company shall
cause notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor to be mailed, first-class postage prepaid, to
the Holder of such Registered Security (or a Predecessor Security thereof) at
his address as it appears in the Security Register not less than 10 days
prior to such Special Record Date. The Trustee may, in its discretion, in
the name and at the expense of the Company cause a similar notice to be
published at least once in an Authorized Newspaper of general circulation in
the Borough of Manhattan, The City of New York, but such publication shall
not be a condition precedent to the establishment of such Special Record
Date. Notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor having been mailed as aforesaid, such Defaulted
Interest shall be paid to the Person in whose name such Registered Security
(or a Predecessor Security thereof) shall be registered at the close of
business on such Special Record Date and shall no longer be payable pursuant
to the following Clause (2). In case a Bearer Security is surrendered at the
Office or Agency for such Security in exchange for a Registered Security
after the close of business at such Office or Agency on any Special Record
Date and before the opening of business at such Office or Agency on the
related proposed date for payment of Defaulted Interest, such Bearer Security
shall be surrendered without the Coupon relating to such proposed date of
payment and Defaulted Interest shall not be payable on such proposed date of
payment in respect of the Registered Security issued in exchange for such
Bearer Security, but shall be payable only to the Holder of such Coupon when
due in accordance with the provisions of this Indenture.
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(2) The Company may make payment of any Defaulted Interest in any other
lawful manner not inconsistent with the requirements of any securities
exchange on which such Security may be listed, and upon such notice as may be
required by such exchange, if, after notice given by the Company to the
Trustee of the proposed payment pursuant to this Clause, such payment shall
be deemed practicable by the Trustee.
At the option of the Company, interest on Registered Securities that bear
interest may be paid by mailing a check to the address of the Person entitled
thereto as such address shall appear in the Security Register.
Subject to the foregoing provisions of this Section 307 and Section 305,
each Security delivered under this Indenture upon registration of transfer of
or in exchange for or in lieu of any other Security shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such other
Security.
Section 308. Persons Deemed Owners.
Prior to due presentment of a Registered Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name such Registered Security is registered in
the Security Register as the owner of such Registered Security for the purpose
of receiving payment of principal of, any premium and (subject to Sections 305
and 307) interest on and any Additional Amounts with respect to such Registered
Security and for all other purposes whatsoever, whether or not any payment with
respect to such Registered Security shall be overdue, and neither the Company,
nor the Trustee or any agent of the Company or the Trustee shall be affected by
notice to the contrary.
The Company, the Trustee and any agent of the Company or the Trustee may
treat the bearer of any Bearer Security or the bearer of any Coupon as the
absolute owner of such Security or Coupon for the purpose of receiving payment
thereof or on account thereof, for the purpose of conversion and for all other
purposes whatsoever, whether or not any payment with respect to such Security
or Coupon shall be overdue, and neither the Company, nor the Trustee or any
agent of the Company or the Trustee shall be affected by notice to the
contrary.
No holder of any beneficial interest in any global Security held on its
behalf by a Depository shall have any rights under this Indenture with respect
to such global Security, and such Depository may be treated by the Company, the
Trustee, and any agent of the Company or the Trustee as the owner of such
global Security for all purposes whatsoever. None of the Company, the Trustee,
any Paying Agent or the Security Registrar will have any responsibility or
liability for any aspect of the records
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relating to or payments made on account of beneficial ownership interests of a
global Security or for maintaining, supervising or reviewing any records
relating to such beneficial ownership interests.
Section 309. Cancellation.
All Securities and Coupons surrendered for payment, redemption, registration
of transfer, exchange or conversion or for credit against any sinking fund
payment shall, if surrendered to any Person other than the Trustee, be
delivered to the Trustee, and any such Securities and Coupons, as well as
Securities and Coupons surrendered directly to the Trustee for any such
purpose, shall be cancelled promptly by the Trustee. The Company may at any
time deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which the Company may have acquired in
any manner whatsoever, and all Securities so delivered shall be cancelled
promptly by the Trustee. No Securities shall be authenticated in lieu of or in
exchange for any Securities cancelled as provided in this Section, except as
expressly permitted by or pursuant to this Indenture. All cancelled Securities
and Coupons held by the Trustee shall be destroyed by the Trustee, unless by a
Company Order the Company directs their return to it in a timely manner.
Section 310. Computation of Interest.
Except as otherwise provided in or pursuant to this Indenture, interest on
the Securities shall be computed on the basis of a 360-day year of twelve
30-day months.
ARTICLE FOUR
SATISFACTION AND DISCHARGE
Section 401. Satisfaction and Discharge of Indenture.
Upon the direction of the Company by a Company Order, this Indenture shall
cease to be of further effect (except as to any surviving rights of conversion,
registration of transfer or exchange of Securities herein expressly provided
for and any right to receive Additional Amounts), and the Trustee, on receipt
of a Company Order, at the expense of the Company, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture, when
(1) either
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(A) all Securities theretofore authenticated and delivered and all
Coupons appertaining thereto (other than (i) Coupons appertaining to Bearer
Securities surrendered in exchange for Registered Securities and maturing
after such exchange whose surrender is not required or has been waived as
provided in Section 305, (ii) Securities and Coupons which have been
destroyed, lost or stolen and which have been replaced or paid as provided
in Section 306, (iii) Coupons appertaining to Securities called for
redemption and maturing after the relevant Redemption Date whose surrender
has been waived as provided in Section 1107, and (iv) Securities and Coupons
for whose payment money has theretofore been deposited in trust or
segregated and held in trust by the Company and thereafter repaid to the
Company or discharged from such trust, as provided in Section 1003) have
been delivered to the Trustee for cancellation; or
(B) all Securities and, in the case of (i) or (ii) below, any Coupons
appertaining thereto not theretofore delivered to the Trustee for
cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity within one
year, or
(iii) if redeemable at the option of the Company, are to be called
for redemption within one year under arrangements satisfactory to the
Trustee for the giving of notice of redemption by the Trustee in the name,
and at the expense, of the Company,
and the Company, in the case of (i), (ii) or (iii) above, has deposited or
caused to be deposited with the Trustee as trust funds in trust for such
purpose, money and/or Government Obligations which through the payment of
interest and principal in respect thereof in accordance with their terms,
without consideration of any reinstatement thereof, will provide not later
than the opening of business on the due dates of any payment of principal
and any premium, interest and Additional Amounts with respect thereto, or a
combination thereof, money in an amount sufficient to pay and discharge the
entire indebtedness on such Securities and Coupons not theretofore delivered
to the Trustee for cancellation, including the principal of, any premium and
interest on, and any Additional Amounts with respect to such Securities and
any Coupons appertaining thereto, to the date of such deposit (in the case
of Securities which have become due and payable) or to the Maturity thereof,
as the case may be;
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(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company;
(3) the Company has delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture
have been complied with; and
(4) the Company has delivered to the Trustee a certificate of Independent
Public Accountants certifying as to the sufficiency of the amounts deposited
pursuant to subclause (B) of Clause (1) of this Section 401 for payment of
the principal and any premium, interest and Additional Amounts with respect
thereto on the dates such payments are due.
In the event there are Securities of two or more series hereunder, the
Trustee shall be required to execute an instrument acknowledging satisfaction
and discharge of this Indenture only if requested to do so with respect to
Securities of all series as to which it is Trustee and if the other conditions
thereto are met. In the event there are two or more Trustees hereunder, then
the effectiveness of any such instrument shall be conditioned upon receipt of
each such instrument from all Trustees hereunder.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 605, the obligations of
the Trustee to any Authenticating Agent under Section 610 and, if money and/or
Government Obligations shall have been deposited with the Trustee pursuant to
subclause (B) of Clause (1) of this Section, the obligations of the Trustee
under Section 403 and the last paragraph of Section 1003 shall survive.
In the event that, subsequent to the date a discharge is effected pursuant
to this Section 401, Additional Amounts in excess of those established as of
the date such discharge is effected become payable in respect of any
Securities, in order to preserve the benefits of the discharge established
hereunder, the Company shall deposit or cause to be deposited in accordance
with provisions of this Section 401, within ten business days prior to the
earlier to occur of (i) one year after the existence of such excess Additional
Amounts is established and (ii) the date the first payment in respect of any
portion of such excess Additional Amounts becomes due, such additional funds as
are necessary to satisfy the provisions of this Section 401 as if a discharge
were being effected as of the date of such subsequent deposit. For purposes of
this paragraph, the existence of excess Additional Amounts shall be deemed to
have been established as of the date the governmental authority imposing the
tax, assessment or other governmental charge resulting in the Additional
Amounts first publishes the legislation, regulation or other enactment adopting
such tax, assessment or other
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governmental charge. Failure to comply with the requirements of this paragraph
shall result in the termination of the benefits of the discharge established by
this Section 401.
Section 402. Satisfaction, Discharge and Defeasance of Securities of any
Series.
If provision is made in or pursuant to this Indenture for defeasance of
Securities of any series and any Coupons appertaining thereto pursuant to this
Section 402, the Company shall be deemed to have paid and discharged the entire
indebtedness on all the Outstanding Securities of such series and the Trustee,
at the expense of the Company, shall execute proper instruments acknowledging
satisfaction and discharge of such indebtedness, when
(1) no Event of Default has occurred and is continuing, or would occur
upon the giving of notice or the lapse of time at the time such satisfaction
and discharge is being effected and either
(A) with respect to all Outstanding Securities of such series and any
Coupons appertaining thereto, the Company has irrevocably deposited or
caused to be deposited with the Trustee, as trust funds and/or obligations
in trust for such purpose, money and/or Government Obligations which through
the payment of interest and principal in respect thereof in accordance with
their terms, without consideration of any reinvestment thereof, will provide
not later than the opening of business on the due dates of any payment of
principal and any premium, interest and Additional Amounts with respect
thereto, or a combination thereof, money in an amount sufficient to pay and
discharge the entire indebtedness on all Outstanding Securities of such
series and any Coupons appertaining thereto not theretofore delivered to the
Trustee for cancellation, including the principal of, any premium and
interest on, and any Additional Amounts with respect to such Securities and
any Coupons appertaining thereto to the date of such deposit (in the case of
Securities which have become due and payable) or to the Maturity thereof, as
the case may be, as contemplated by the penultimate paragraph of this
Section 402; or
(B) the Company has properly fulfilled such other means of
satisfaction and discharge as is provided in or pursuant to this Indenture
for the Securities of such series; and
(2) the Company has paid or caused to be paid all other sums payable
hereunder with respect to the Outstanding Securities of such series and any
Coupons appertaining thereto; and
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(3) the Company has delivered to the Trustee a certificate signed by
Independent Public Accountants certifying as to the sufficiency of the
amounts deposited pursuant to subsections (A)(i) or (ii) of this Section for
payment of the principal of, any premium and interest on and any Additional
Amounts with respect to such Securities and any Coupons appertaining thereto
on the dates such payments are due, an Officers' Certificate and an Opinion
of Counsel, each such Certificate and Opinion stating that no Event of
Default or event which with notice or lapse of time or both would become an
Event of Default with respect to such Securities shall have occurred and all
conditions precedent herein provided for relating to the satisfaction and
discharge of the entire indebtedness on all Outstanding Securities of any
such series and any Coupons appertaining thereto shall have been complied
with; and
(4) the Company has delivered to the Trustee
(A) an opinion of independent counsel that the Holders of the
Securities of such series and any Coupons appertaining thereto shall have no
federal income tax consequences as a result of such deposit and termination;
and
(B) if the Securities of such series are then listed on the New York
Stock Exchange, an opinion of independent counsel that the Securities of
such series shall not be delisted as a result of the exercise of this
option.
Any deposits with the Trustee referred to in subsection (1)(A) of this
Section shall be irrevocable and shall be made under the terms of an escrow
trust agreement in form and substance satisfactory to the Trustee. If any
Outstanding Securities of such series are to be redeemed prior to their Stated
Maturity, whether pursuant to any optional redemption provisions or in
accordance with any mandatory sinking fund requirement or otherwise, the
Company shall make such arrangements as are satisfactory to the Trustee for the
giving of notice of redemption by the Trustee in the name, and at the expense,
of the Company.
Upon the satisfaction of the conditions set forth in this Section 402 with
respect to all the Outstanding Securities of any series and any Coupons
appertaining thereto, the terms and conditions of such series (including the
terms and conditions with respect thereto set forth in this Indenture, other
than the provisions of Sections 305, 306, and 1002 and other than the right of
Holders of Securities of such series and any Coupons appertaining thereto to
receive, from the trust fund described in this Section, payment of the
principal of, any premium or the interest on, or any Additional Amounts with
respect to such Securities and any Coupons appertaining thereto when such
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payments shall be due) and the rights, powers, duties and immunities of the
Trustee hereunder with respect to the Securities of such series shall no longer
be binding upon, or applicable to, the Company; provided that the Company shall
not be discharged from any payment obligations in respect of Securities of such
series or any Coupons appertaining thereto which are deemed not to be
Outstanding under clause (iii) of the definition of Outstanding if such
obligations continue to be valid obligations of the Company under applicable
law.
In the event that, subsequent to the date a defeasance is effected pursuant
to this Section 402 with respect to Securities of any series, Additional
Amounts in excess of those established as of the date such defeasance is
effected become payable in respect of such Securities, in order to preserve the
benefits of the defeasance established hereunder with respect to such series,
the Company shall deposit or cause to be deposited in accordance with the
provisions of this Section 402, within ten business days prior to the earlier
to occur of (i) one year after the existence of such excess Additional Amounts
is established and (ii) the date the first payment in respect of any portion of
such excess Additional Amounts becomes due, such additional funds as are
necessary to satisfy the provisions of this Section 402 as if a defeasance were
being effected as of the date of such subsequent deposit. For purposes of this
paragraph, the existence of excess Additional Amounts shall be deemed to have
been established as of the date the governmental authority imposing the tax,
assessment or other governmental charge resulting in the Additional Amounts
first publishes the legislation, regulation or other enactment adopting such
tax, assessment or other governmental charge. Failure to comply with the
requirements of this paragraph shall result in the termination of the benefits
of the defeasance established by this Section 402 with respect to the
Securities of such series.
Section 403. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 1003, all money
and Government Obligations deposited with the Trustee pursuant to Section 401
or 402 shall be held in trust and applied by it, in accordance with the
provisions of the Securities, the Coupons and this Indenture, to the payment,
either directly or through any Paying Agent (including the Company acting as
its own Paying Agent) as the Trustee may determine, to the Persons entitled
thereto, of the principal, premium, interest and Additional Amounts for whose
payment such money has or Government Obligations have been deposited with or
received by the Trustee; but such money and Government Obligations need not be
segregated from other funds except to the extent required by law.
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ARTICLE FIVE
REMEDIES
Section 501. Events of Default.
"Event of Default", wherever used herein with respect to Securities of any
series, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or be effected by operation
of law pursuant to any judgment, decree or order of any court or any order,
rule or regulation of any administrative or governmental body):
(1) default in the payment of any interest on or any Additional Amounts
payable in respect of any Security of such series when such interest becomes
or such Additional Amounts become due and payable, and continuance of such
default for a period of 30 days; or
(2) default in the payment of the principal of and any premium on any
Security of such series when it becomes due and payable at its Maturity; or
(3) default in the deposit of any sinking fund payment, when and as due
by the terms of a Security of such series; or
(4) default in the performance, or breach, of any covenant or warranty of
the Company in this Indenture or the Securities (other than a covenant or
warranty a default in the performance or the breach of which is elsewhere in
this Section specifically dealt with or which has been expressly included in
this Indenture solely for the benefit of a series of Securities other than
such series), and continuance of such default or breach for a period of 60
days after there has been given, by registered or certified mail, to the
Company by the Trustee or to the Company and the Trustee by the Holders of at
least 25% in principal amount of the Outstanding Securities of such series a
written notice specifying such default or breach and requiring it to be
remedied and stating that such notice is a "Notice of Default" hereunder; or
(5) if any event of default as defined in any mortgage, indenture or
instrument under which there may be issued, or by which there may be secured
or evidenced, any indebtedness of the Company or any Significant Subsidiary
for money borrowed, whether such indebtedness now exists or shall hereafter
be created, shall happen and shall result in such indebtedness in
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principal amount in excess of $10,000,000 becoming or being declared due and
payable prior to the date on which it would otherwise become due and payable,
and such acceleration shall not be rescinded or annulled within a period of
30 days after there shall have been given, by registered or certified mail,
to the Company by the Trustee or to the Company and the Trustee by the
Holders of at least 25% in principal amount of the Outstanding Securities of
such series, a written notice specifying such event of default and requiring
the Company to cause such acceleration to be rescinded or annulled and
stating that such notice is a "Notice of Default" hereunder; or
(6) the entry by a court having competent jurisdiction of:
(a) a decree or order for relief in respect of the Company or any
Significant Subsidiary in an involuntary proceeding under any applicable
bankruptcy, insolvency, reorganization or other similar law and such decree
or order shall remain unstayed and in effect for a period of 60 consecutive
days; or
(b) a decree or order adjudging the Company or any Significant
Subsidiary to be insolvent, or approving a petition seeking reorganization,
arrangement, adjustment or composition of the Company or any Significant
Subsidiary and such decree or order shall remain unstayed and in effect for
a period of 60 consecutive days; or
(c) a final and non-appealable order appointing a custodian, receiver,
liquidator, assignee, trustee or other similar official of the Company or
any Significant Subsidiary or of any substantial part of the property of the
Company or any Significant Subsidiary, as the case may be, or ordering the
winding up or liquidation of the affairs of the Company or any Significant
Subsidiary; or
(7) the commencement by the Company or any Significant Subsidiary of a
voluntary proceeding under any applicable bankruptcy, insolvency,
reorganization or other similar law or of a voluntary proceeding seeking to
be adjudicated insolvent or the consent by the Company or any Significant
Subsidiary to the entry of a decree or order for relief in an involuntary
proceeding under any applicable bankruptcy, insolvency, reorganization or
other similar law or to the commencement of any insolvency proceedings
against it, or the filing by the Company or any Significant Subsidiary of a
petition or answer or consent seeking reorganization or relief under any
applicable law, or the consent by the Company or any Significant Subsidiary
to the filing of such petition or to the appointment of or taking possession
by a custodian, receiver, liquidator,
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assignee, trustee or similar official of the Company or any Significant
Subsidiary or any substantial part of the property of the Company or any
Significant Subsidiary or the making by the Company or any Significant
Subsidiary of an assignment for the benefit of creditors, or the taking of
corporate action by the Company or any Significant Subsidiary in furtherance
of any such action; or
(8) any other Event of Default provided in or pursuant to this Indenture
with respect to Securities of such series.
Section 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default with respect to Securities of any series at the time
Outstanding occurs and is continuing, then the Trustee or the Holders of not
less than 25% in principal amount of the Outstanding Securities of such series
may declare the principal of all the Securities of such series, or such lesser
amount as may be provided for in the Securities of such series, to be due and
payable immediately, by a notice in writing to the Company (and to the Trustee
if given by the Holders), and upon any such declaration such principal or such
lesser amount shall become immediately due and payable.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in
this Article provided, the Holders of not less than a majority in principal
amount of the Outstanding Securities of such series, by written notice to the
Company and the Trustee, may rescind and annul such declaration and its
consequences if:
(1) the Company has paid or deposited with the Trustee a sum of money
sufficient to pay
(A) all overdue installments of any interest on and any Additional
Amounts with respect to all Securities of such series and any Coupon
appertaining thereto,
(B) the principal of and any premium on any Securities of such series
which have become due otherwise than by such declaration of acceleration and
interest thereon at the rate or rates borne by or provided for in such
Securities,
(C) to the extent that payment of such interest is lawful, interest
upon overdue installments of any interest and Additional Amounts at the rate
or rates borne by or provided for in such Securities, and
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(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel; and
(2) all Events of Default with respect to Securities of such series,
other than the non-payment of the principal of, any premium and interest on,
and any Additional Amounts with respect to Securities of such series which
shall have become due solely by such declaration of acceleration, shall have
been cured or waived as provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
Section 503. Collection of Indebtedness and Suits for Enforcement by
Trustee.
The Company covenants that if
(1) default is made in the payment of any installment of interest on or
any Additional Amounts with respect to any Security or any Coupon
appertaining thereto when such interest or Additional Amounts shall have
become due and payable and such default continues for a period of 30 days, or
(2) default is made in the payment of the principal of or any premium on
any Security at its Maturity,
the Company shall, upon demand of the Trustee, pay to the Trustee, for the
benefit of the Holders of such Securities and any Coupons appertaining thereto,
the whole amount of money then due and payable with respect to such Securities
and any Coupons appertaining thereto, with interest upon the overdue principal,
any premium and, to the extent that payment of such interest shall be legally
enforceable, upon any overdue installments of interest and Additional Amounts
at the rate or rates borne by or provided for in such Securities, and, in
addition thereto, such further amount of money as shall be sufficient to cover
the costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel.
If the Company fails to pay the money it is required to pay the Trustee
pursuant to the preceding paragraph forthwith upon the demand of the Trustee,
the Trustee, in its own name and as trustee of an express trust, may institute
a judicial proceeding for the collection of the money so due and unpaid, and
may prosecute such proceeding to judgment or final decree, and may enforce the
same against the Company
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or any other obligor upon such Securities and any Coupons appertaining thereto
and collect the moneys adjudged or decreed to be payable in the manner provided
by law out of the property of the Company or any other obligor upon such
Securities and any Coupons appertaining thereto, wherever situated.
If an Event of Default with respect to Securities of any series occurs and
is continuing, the Trustee may in its discretion proceed to protect and enforce
its rights and the rights of the Holders of Securities of such series and any
Coupons appertaining thereto by such appropriate judicial proceedings as the
Trustee shall deem most effectual to protect and enforce any such rights,
whether for the specific enforcement of any covenant or agreement in this
Indenture or such Securities or in aid of the exercise of any power granted
herein or therein, or to enforce any other proper remedy.
Section 504. Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the Securities
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company for the payment of any overdue principal, premium, interest or
Additional Amounts) shall be entitled and empowered, by intervention in such
proceeding or otherwise,
(i) to file and prove a claim for the whole amount, or such lesser
amount as may be provided for in the Securities of such series, of the
principal and any premium, interest and Additional Amounts owing and unpaid
in respect of the Securities and any Coupons appertaining thereto and to
file such other papers or documents as may be necessary or advisable in
order to have the claims of the Trustee (including any claim for the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents or counsel) and of the Holders of Securities or any
Coupons allowed in such judicial proceeding, and
(ii) to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder of Securities or any Coupons to make such payments to the Trustee
and, in the event that the Trustee shall consent to the making of such payments
directly to the Holders of Securities or any
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Coupons, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel and any other amounts due the Trustee under Section 605.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder of a
Security or any Coupon any plan of reorganization, arrangement, adjustment or
composition affecting the Securities or Coupons or the rights of any Holder
thereof, or to authorize the Trustee to vote in respect of the claim of any
Holder of a Security or any Coupon in any such proceeding.
Section 505. Trustee May Enforce Claims without Possession of Securities or
Coupons.
All rights of action and claims under this Indenture or any of the
Securities or Coupons may be prosecuted and enforced by the Trustee without the
possession of any of the Securities or Coupons or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the Trustee
shall be brought in its own name as trustee of an express trust, and any
recovery or judgment, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, shall be for the ratable benefit of each and every Holder of a
Security or Coupon in respect of which such judgment has been recovered.
Section 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal, or any
premium, interest or Additional Amounts, upon presentation of the Securities
or Coupons, or both, as the case may be, and the notation thereon of the
payment if only partially paid and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee and any predecessor
Trustee under Section 605;
SECOND: To the payment of the amounts then due and unpaid upon the
Securities and any Coupons for principal and any premium, interest and
Additional Amounts in respect of which or for the benefit of which such money
has been collected, ratably, without preference or priority of any kind,
according to the aggregate amounts due and payable on such Securities and
Coupons for principal and any premium, interest and Additional Amounts,
respectively;
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THIRD: The balance, if any, to the Person or Persons entitled thereto.
Section 507. Limitations on Suits.
No Holder of any Security of any series or any Coupons appertaining thereto
shall have any right to institute any proceeding, judicial or otherwise, with
respect to this Indenture, or for the appointment of a receiver or trustee, or
for any other remedy hereunder, unless
(1) such Holder has previously given written notice to the Trustee of a
continuing Event of Default with respect to the Securities of such series;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Securities of such series shall have made written request to the
Trustee to institute proceedings in respect of such Event of Default in its
own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice, request and
offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been given to
the Trustee during such 60-day period by the Holders of a majority in
principal amount of the Outstanding Securities of such series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture or any Security to affect, disturb or prejudice the rights of
any other such Holders or Holders of Securities of any other series, or to
obtain or to seek to obtain priority or preference over any other Holders or to
enforce any right under this Indenture, except in the manner herein provided
and for the equal and ratable benefit of all such Holders.
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Section 508. Unconditional Right of Holders to Receive Principal and any
Premium, Interest and Additional Amounts and to Convert any
Convertible Security.
Notwithstanding any other provision in this Indenture, the Holder of any
Security or Coupon shall have the right, which is absolute and unconditional,
to receive payment of the principal of, any premium and (subject to Sections
305 and 307) interest on, and any Additional Amounts with respect to such
Security or payment of such Coupon, as the case may be, on the respective
Stated Maturity or Maturities therefor specified in such Security or Coupon
(or, in the case of redemption, on the Redemption Date or, in the case of
repayment at the option of such Holder if provided in or pursuant to this
Indenture, on the date such repayment is due) and to institute suit for the
enforcement of any such payment, and shall have the right to convert any such
Security which is a Convertible Security in accordance with the terms hereof
and thereof and to institute suit for enforcement of such right; and such
rights shall not be impaired without the consent of such Holder.
Section 509. Restoration of Rights and Remedies.
If the Trustee or any Holder of a Security or a Coupon has instituted any
proceeding to enforce any right or remedy under this Indenture and such
proceeding has been discontinued or abandoned for any reason, or has been
determined adversely to the Trustee or to such Holder, then and in every such
case the Company, the Trustee and each such Holder shall, subject to any
determination in such proceeding, be restored severally and respectively to
their former positions hereunder, and thereafter all rights and remedies of the
Trustee and each such Holder shall continue as though no such proceeding had
been instituted.
Section 510. Rights and Remedies.
Except as otherwise provided with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Securities or Coupons in the last
paragraph of Section 306, no right or remedy herein conferred upon or reserved
to the Trustee or to each and every Holder of a Security or a Coupon is
intended to be exclusive of any other right or remedy, and every right and
remedy, to the extent permitted by law, shall be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at
law or in equity or otherwise. The assertion or employment of any right or
remedy hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
Section 511. Delay or Omission Not Waiver.
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No delay or omission of the Trustee or of any Holder of any Security or
Coupon to exercise any right or remedy accruing upon any Event of Default shall
impair any such right or remedy or constitute a waiver of any such Event of
Default or an acquiescence therein. Every right and remedy given by this
Article or by law to the Trustee or to any Holder of a Security or a Coupon may
be exercised from time to time, and as often as may be deemed expedient, by the
Trustee or by such Holder, as the case may be.
Section 512. Control by Holders of Securities.
The Holders of a majority in principal amount of the Outstanding Securities
of any series shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee with respect to the Securities of
such series and any Coupons appertaining thereto, provided that
(1) such direction shall not be in conflict with any rule of law or with
this Indenture or with the Securities of any series,
(2) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction, and
(3) such direction is not unduly prejudicial to the rights of the other
Holders of Securities of such series not joining in such action.
Section 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Securities of any series on behalf of the Holders of all the
Securities of such series and any Coupons appertaining thereto may waive any
past default hereunder with respect to such series and its consequences, except
a default
(1) in the payment of the principal of, any premium or interest on, or
any Additional Amounts with respect to any Security of such series or any
Coupons appertaining thereto, or
(2) in respect of a covenant or provision hereof which under Article Nine
cannot be modified or amended without the consent of the Holder of each
Outstanding Security of such series affected.
Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this
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Indenture; but no such waiver shall extend to any subsequent or other default
or impair any right consequent thereon.
Section 514. Waiver of Stay or Extension Laws.
The Company covenants that (to the extent that it may lawfully do so)
it will not at any time insist upon, or plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay or extension law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Indenture; and the Company expressly waives (to the
extent that it may lawfully do so) all benefit or advantage of any such law and
covenant that it will not hinder, delay or impede the execution of any power
herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
ARTICLE SIX
THE TRUSTEE
Section 601. Certain Rights of Trustee.
Subject to Sections 315(a) through 315(d) of the Trust Indenture Act:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, coupon or other paper or document reasonably
believed by it to be genuine and to have been signed or presented by the
proper party or parties;
(b) any request or direction of the Company mentioned herein
shall be sufficiently evidenced by a Company Request or a Company Order
(in each case, other than delivery of any Security, together with any
Coupons appertaining thereto, to the Trustee for authentication and
delivery pursuant to Section 303 which shall be sufficiently evidenced as
provided therein) and any resolution of the Board of Directors may be
sufficiently evidenced by a Board Resolution;
(c) whenever in the administration of this Indenture the
Trustee shall deem it desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder, the Trustee
(unless other evidence shall be herein specifically prescribed) may, in
the absence of bad faith on its
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part, rely upon an Officers' Certificate;
(d) the Trustee may consult with counsel and the advice of such
counsel or any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by or pursuant to this Indenture at the
request or direction of any of the Holders of Securities of any series or
any Coupons appertaining thereto pursuant to this Indenture, unless such
Holders shall have offered to the Trustee reasonable security or indemnity
against the costs, expenses and liabilities which might be incurred by it
in compliance with such request or direction;
(f) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, coupon 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, during business hours and upon reasonable
notice, the books, records and premises of the Company, personally or by
agent or attorney; and
(g) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys and the Trustee shall not be responsible for any
misconduct or negligence on the part of any agent or attorney appointed
with due care by it hereunder.
Section 602. Not Responsible for Recitals or Issuance of
Securities.
The recitals contained herein and in the Securities, except the
Trustee's certificate of authentication, and in any Coupons shall be taken as
the statements of the Company and neither the Trustee nor any Authenticating
Agent assumes any responsibility for their correctness. The Trustee makes no
representations as to the validity or sufficiency of this Indenture or of the
Securities or the Coupons, except that the Trustee represents that it is duly
authorized to execute and deliver this Indenture, authenticate the Securities
and perform its obligations hereunder and that the statements made by it in a
Statement of Eligibility and Qualification on Form T-1 supplied to the Company
are true and accurate, subject to the qualifications set forth therein. Neither
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the Trustee nor any Authenticating Agent shall be accountable for the use or
application by the Company of the Securities or the proceeds thereof.
Section 603. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any Security
Registrar or any other Person that may be an agent of the Trustee or the
Company, in its individual or any other capacity, may become the owner or
pledgee of Securities or Coupons and, subject to Sections 310(b) and 311 of the
Trust Indenture Act, may otherwise deal with the Company with the same rights
it would have if it were not Trustee, Authenticating Agent, Paying Agent,
Security Registrar or such other Person.
Section 604. Money Held in Trust.
Except as provided in Section 403 and Section 1003, money held by the
Trustee in trust hereunder need not be segregated from other funds except to
the extent required by law and shall be held uninvested. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
otherwise agreed with the Company.
Section 605. Compensation and Reimbursement.
The Company agrees:
(1) to pay to the Trustee from time to time reasonable
compensation for all services rendered by the Trustee hereunder (which
compensation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to reimburse
the Trustee upon its request for all reasonable expenses, disbursements
and advances incurred or made by the Trustee in accordance with any
provision of this Indenture (including the reasonable compensation and the
expenses and disbursements of its agents and counsel), except any such
expense, disbursement or advance as may be attributable to the Trustee's
negligence or bad faith; and
(3) to indemnify the Trustee and its agents for, and to hold
them harmless against, any loss, liability or expense incurred without
negligence or bad faith on their part, arising out of or in connection
with the acceptance or administration of the trust or trusts hereunder,
including the costs and expenses of defending themselves against any claim
or liability in connection with the
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exercise or performance of any of their powers or duties hereunder.
As security for the performance of the obligations of the Company
under this Section 605, the Trustee shall have a lien prior to the Securities
of any series upon all property and funds held or collected by the Trustee as
such, except funds held in trust for the payment of principal of, and premium
or interest on or any Additional Amounts with respect to Securities or any
Coupons appertaining thereto.
Section 606. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder that is a
Corporation permitted by the Trust Indenture Act to act as trustee under an
indenture qualified under the Trust Indenture Act and that has a combined
capital and surplus (computed in accordance with Section 310(a)(2) of the Trust
Indenture Act) of at least $50,000,000. If at any time the Trustee shall cease
to be eligible in accordance with the provisions of this Section 606, it shall
resign immediately in the manner and with the effect hereinafter specified in
this Article.
Section 607. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Trustee and no appointment
of a successor Trustee pursuant to this Article shall become effective
until the acceptance of appointment by the successor Trustee pursuant to
Section 608.
(b) The Trustee may resign at any time with respect to the
Securities of one or more series by giving written notice thereof to the
Company. If the instrument of acceptance by a successor Trustee required
by Section 608 shall not have been delivered to the Trustee within 30 days
after the giving of such notice of resignation, the resigning Trustee may
petition any court of competent jurisdiction for the appointment of a
successor Trustee with respect to such series.
(c) The Trustee may be removed at any time with respect to the
Securities of any series by Act of the Holders of a majority in principal
amount of the Outstanding Securities of such series, delivered to the
Trustee and the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with the obligations
imposed upon it under Section 310(b) of the Trust Indenture Act with
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respect to Securities of any series after written request therefor by
the Company or any Holder of a Security of such series who has been a
bona fide Holder of a Security of such series for at least six
months, or
(2) the Trustee shall cease to be eligible under Section
606 and shall fail to resign after written request therefor by the
Company or any such Holder, or
(3) the Trustee shall become incapable of acting or shall
be adjudged a bankrupt or insolvent or a receiver of the Trustee or
of its property shall be appointed or any public officer shall take
charge or control of the Trustee or of its property or affairs for
the purpose of rehabilitation, conservation or liquidation,
then, in any such case, (i) the Company, by or pursuant to a Board
Resolution, may remove the Trustee with respect to all Securities or the
Securities of such series, or (ii) subject to Section 315(e) of the Trust
Indenture Act, any Holder of a Security who has been a bona fide Holder of
a Security of such series for at least six months may, on behalf of
himself and all others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee with respect to all Securities
of such series and the appointment of a successor Trustee or Trustees.
(e) If the Trustee shall resign, be removed or become incapable
of acting, or if a vacancy shall occur in the office of Trustee for any
cause, with respect to the Securities of one or more series, the Company,
by or pursuant to a Board Resolution, shall promptly appoint a successor
Trustee or Trustees with respect to the Securities of that or those series
(it being understood that any such successor Trustee may be appointed with
respect to the Securities of one or more or all of such series and that at
any time there shall be only one Trustee with respect to the Securities of
any particular series) and shall comply with the applicable requirements
of Section 608. If, within one year after such resignation, removal or
incapability, or the occurrence of such vacancy, a successor Trustee with
respect to the Securities of any series shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding Securities of
such series delivered to the Company and the retiring Trustee, the
successor Trustee so appointed shall, forthwith upon its acceptance of
such appointment in accordance with the applicable requirements of Section
608, become the successor Trustee with respect to the Securities of such
series and to that extent supersede the successor Trustee appointed by the
Company. If no successor Trustee with respect to the Securities of any
series shall have been so appointed by the Company or the Holders of
Securities and accepted appointment in the
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manner required by Section 608, any Holder of a Security who has been a
bona fide Holder of a Security of such series for at least six months may,
on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the appointment of a successor Trustee with
respect to the Securities of such series.
(f) The Company shall give notice of each resignation and each
removal of the Trustee with respect to the Securities of any series and
each appointment of a successor Trustee with respect to the Securities of
any series by mailing written notice of such event by first-class mail,
postage prepaid, to the Holders of Registered Securities, if any, of such
series as their names and addresses appear in the Security Register and,
if Securities of such series are issued as Bearer Securities, by
publishing notice of such event once in an Authorized Newspaper in each
Place of Payment located outside the United States. Each notice shall
include the name of the successor Trustee with respect to the Securities
of such series and the address of its Corporate Trust Office.
Section 608. Acceptance of Appointment by Successor.
(a) Upon the appointment hereunder of any successor Trustee
with respect to all Securities, such successor Trustee so appointed shall
execute, acknowledge and deliver to the Company and the retiring Trustee
an instrument accepting such appointment, and thereupon the resignation or
removal of the retiring Trustee shall become effective and such successor
Trustee, without any further act, deed or conveyance, shall become vested
with all the rights, powers, trusts and duties hereunder of the retiring
Trustee; but, on the request of the Company or such successor Trustee,
such retiring Trustee, upon payment of its charges, shall execute and
deliver an instrument transferring to such successor Trustee all the
rights, powers and trusts of the retiring Trustee and, subject to Section
1003, shall duly assign, transfer and deliver to such successor Trustee
all property and money held by such retiring Trustee hereunder, subject
nevertheless to its claim, if any, provided for in Section 605.
(b) Upon the appointment hereunder of any successor Trustee
with respect to the Securities of one or more (but not all) series, the
Company, the retiring Trustee and such successor Trustee shall execute and
deliver an indenture supplemental hereto wherein each successor Trustee
shall accept such appointment and which (1) shall contain such provisions
as shall be necessary or desirable to transfer and confirm to, and to vest
in, such successor Trustee all the rights, powers, trusts and duties of
the retiring Trustee with respect to the Securities of that or those
series to which the appointment of such successor Trustee relates, (2) if
the retiring Trustee is not retiring with respect to all
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Securities, shall contain such provisions as shall be deemed necessary or
desirable to confirm that all the rights, powers, trusts and duties of the
retiring Trustee with respect to the Securities of that or those series as
to which the retiring Trustee is not retiring shall continue to be vested
in the retiring Trustee, and (3) shall add to or change any of the
provisions of this Indenture as shall be necessary to provide for or
facilitate the administration of the trusts hereunder by more than one
Trustee, it being understood that nothing herein or in such supplemental
indenture shall constitute such Trustees co-trustees of the same trust,
that each such Trustee shall be trustee of a trust or trusts hereunder
separate and apart from any trust or trusts hereunder administered by any
other such Trustee and that no Trustee shall be responsible for any notice
given to, or received by, or any act or failure to act on the part of any
other Trustee hereunder, and, upon the execution and delivery of such
supplemental indenture, the resignation or removal of the retiring Trustee
shall become effective to the extent provided therein, such retiring
Trustee shall have no further responsibility for the exercise of rights
and powers or for the performance of the duties and obligations vested in
the Trustee under this Indenture with respect to the Securities of that or
those series to which the appointment of such successor Trustee relates
other than as hereinafter expressly set forth, and such successor Trustee,
without any further act, deed or conveyance, shall become vested with all
the rights, powers, trusts and duties of the retiring Trustee with respect
to the Securities of that or those series to which the appointment of such
successor Trustee relates; but, on request of the Company or such
successor Trustee, such retiring Trustee, upon payment of its charges with
respect to the Securities of that or those series to which the appointment
of such successor relates and subject to Section 1003 shall duly assign,
transfer and deliver to such successor Trustee, to the extent contemplated
by such supplemental indenture, the property and money held by such
retiring Trustee hereunder with respect to the Securities of that or those
series to which the appointment of such successor Trustee relates.
(c) Upon request of any Person appointed hereunder as a
successor Trustee, the Company shall execute any and all instruments for
more fully and certainly vesting in and confirming to such successor
Trustee all such rights, powers and trusts referred to in paragraph (a) or
(b) of this Section 608, as the case may be.
(d) No Person shall accept its appointment hereunder as a
successor Trustee unless at the time of such acceptance such successor
Person shall be qualified and eligible under this Article.
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Section 609. Merger, Conversion, Consolidation or Succession to
Business.
Any Corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any Corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any Corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been
authenticated but not delivered by the Trustee then in office, any successor by
merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.
Section 610. Appointment of Authenticating Agent.
The Trustee may appoint one or more Authenticating Agents acceptable
to the Company with respect to one or more series of Securities which shall be
authorized to act on behalf of the Trustee to authenticate Securities of that
or those series issued upon original issue, exchange, registration of transfer,
partial redemption or conversion thereof or pursuant to Section 306, and
Securities so authenticated shall be entitled to the benefits of this Indenture
and shall be valid and obligatory for all purposes as if authenticated by the
Trustee hereunder. Wherever reference is made in this Indenture to the
authentication and delivery of Securities by the Trustee or the Trustee's
certificate of authentication, such reference shall be deemed to include
authentication and delivery on behalf of the Trustee by an Authenticating Agent
and a certificate of authentication executed on behalf of the Trustee by an
Authenticating Agent.
Each Authenticating Agent shall be acceptable to the Company and,
except as provided in or pursuant to this Indenture, shall at all times be a
corporation that would be permitted by the Trust Indenture Act to act as
trustee under an indenture qualified under the Trust Indenture Act, is
authorized under applicable law and by its charter to act as an Authenticating
Agent and has a combined capital and surplus (computed in accordance with
Section 310(a)(2) of the Trust Indenture Act) of at least $50,000,000. If at
any time an Authenticating Agent shall cease to be eligible in accordance with
the provisions of this Section 610, it shall resign immediately in the manner
and with the effect specified in this Section 610.
Any Corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any Corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party,
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or any Corporation succeeding to the corporate agency or corporate trust
business of an Authenticating Agent, shall be the successor of such
Authenticating Agent hereunder, provided such Corporation shall be otherwise
eligible under this Section 610, without the execution or filing of any paper
or any further act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written
notice thereof to the Trustee and the Company. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice
thereof to such Authenticating Agent and the Company. Upon receiving such a
notice of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall (i) mail written
notice of such appointment by first-class mail, postage prepaid, to all Holders
of Registered Securities, if any, of the series with respect to which such
Authenticating Agent shall serve, as their names and addresses appear in the
Security Register, and (ii) if Securities of the series are issued as Bearer
Securities, publish notice of such appointment at least once in an Authorized
Newspaper in the place where such successor Authenticating Agent has its
principal office if such office is located outside the United States. Any
successor Authenticating Agent, upon acceptance of its appointment hereunder,
shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as an Authenticating Agent.
No successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section 610.
The Company agrees to pay each Authenticating Agent from time to time
reasonable compensation for its services under this Section 610. If the
Trustee makes such payments, it shall be entitled to be reimbursed for such
payments, subject to the provisions of Section 605.
The provisions of Sections 308, 602 and 603 shall be applicable to
each Authenticating Agent.
If an Authenticating Agent is appointed with respect to one or more
series of Securities pursuant to this Section 610, the Securities of such
series may have endorsed thereon, in addition to or in lieu of the Trustee's
certificate of authentication, an alternate certificate of authentication in
the following form:
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This is one of the Securities of the series designated herein
referred to in the within-mentioned Indenture.
_________________, As Trustee
By______________________________
As Authenticating Agent
By______________________________
Authorized Signatory
If all of the Securities of any series may not be originally issued
at one time, and if the Trustee does not have an office capable of
authenticating Securities upon original issuance located in a Place of Payment
where the Company wishes to have Securities of such series authenticated upon
original issuance, the Trustee, if so requested in writing (which writing need
not be accompanied by or contained in an Officers' Certificate by the Company),
shall appoint in accordance with this Section 610 an Authenticating Agent
having an office in a Place of Payment designated by the Company with respect
to such series of Securities.
ARTICLE SEVEN
HOLDER'S LISTS AND REPORTS BY TRUSTEE AND COMPANY
Section 701. Company to Furnish Trustee Names and Addresses of
Holders.
In accordance with Section 312(a) of the Trust Indenture Act, the
Company shall furnish or cause to be furnished to the Trustee
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(a) semi-annually with respect to Securities of each series on
October 1 and April 1 of each year or upon such other dates as are set
forth in or pursuant to the Board Resolution or indenture supplemental
hereto authorizing such series, a list, in each case in such form as the
Trustee may reasonably require, of the names and addresses of Holders as
of the applicable date, and
(b) at such other times as the Trustee may request in writing,
within 30 days after the receipt by the Company of any such request, a
list of similar form and content as of a date not more than 15 days prior
to the time such list is furnished,
provided, however, that so long as the Trustee is the Security Registrar no
such list shall be required to be furnished.
Section 702. Preservation of Information; Communications to
Holders.
The Trustee shall comply with the obligations imposed upon it
pursuant to Section 312 of the Trust Indenture Act.
Every Holder of Securities or Coupons, by receiving and holding the
same, agrees with the Company and the Trustee that neither the Company, the
Trustee, any Paying Agent or any Security Registrar shall be held accountable
by reason of the disclosure of any such information as to the names and
addresses of the Holders of Securities in accordance with Section 312 of the
Trust Indenture Act, regardless of the source from which such information was
derived, and that the Trustee shall not be held accountable by reason of
mailing any material pursuant to a request made under Section 312(b) of the
Trust Indenture Act.
Section 703. Reports by Trustee.
(a) Within 60 days after September 15 of each year commencing with
the first September 15 following the first issuance of Securities pursuant to
Section 301, if required by Section 313(a) of the Trust Indenture Act, the
Trustee shall transmit, pursuant to Section 313(c) of the Trust Indenture Act,
a brief report dated as of such September 15 with respect to any of the events
specified in said Section 313(a) which may have occurred since the later of the
immediately preceding September 15 and the date of this Indenture.
(b) The Trustee shall transmit the reports required by Section
313(b) of the Trust Indenture Act at the times specified therein.
(c) Reports pursuant to this Section shall be transmitted in the
manner
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and to the Persons required by Sections 313(c) and 313(d) of the Trust
Indenture Act.
Section 704. Reports by Company.
The Company, pursuant to Section 314(a) of the Trust Indenture Act,
shall:
(1) file with the Trustee, within 15 days after the Company is
required to file the same with the Commission, copies of the annual
reports and of the information, documents and other reports (or copies of
such portions of any of the foregoing as the Commission may from time to
time by rules and regulations prescribe) which the Company may be required
to file with the Commission pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934; or, if the Company is not required to
file information, documents or reports pursuant to either of said
Sections, then it shall file with the Trustee and the Commission, in
accordance with rules and regulations prescribed from time to time by the
Commission, such of the supplementary and periodic information, documents
and reports which may be required pursuant to Section 13 of the Securities
Exchange Act of 1934 in respect of a security listed and registered on a
national securities exchange as may be prescribed from time to time in
such rules and regulations;
(2) file with the Trustee and the Commission, in accordance
with rules and regulations prescribed from time to time by the Commission,
such additional information, documents and reports with respect to
compliance by the Company, as the case may be, with the conditions and
covenants of this Indenture as may be required from time to time by such
rules and regulations; and
(3) transmit within 30 days after the filing thereof with the
Trustee, in the manner and to the extent provided in Section 313(c) of the
Trust Indenture Act, such summaries of any information, documents and
reports required to be filed by the Company pursuant to paragraphs (1) and
(2) of this Section 704 as may be required by rules and regulations
prescribed from time to time by the Commission.
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ARTICLE EIGHT
CONSOLIDATION, MERGER AND SALES
Section 801. Company May Consolidate, Etc., Only on Certain Terms.
Nothing contained in this Indenture or in any of the Securities shall
prevent any consolidation or merger of the Company with or into any other
Person or Persons (whether or not affiliated with the Company), or successive
consolidations or mergers in which the Company or its successor or successors
shall be a party or parties, or shall prevent any conveyance, transfer or lease
of the property of the Company as an entirety or substantially as an entirety,
to any other Person (whether or not affiliated with the Company); provided,
however, that:
(1) in case the Company shall consolidate with or merge into
another Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, the entity formed by such
consolidation or into which the Company is merged or the Person which
acquires by conveyance or transfer, or which leases, the properties and
assets of the Company substantially as an entirety shall be a Corporation
organized and existing under the laws of the United States of America, any
state thereof or the District of Columbia and shall expressly assume, by
an indenture (or indentures, if at such time there is more than one
Trustee) supplemental hereto, executed by the successor Person and
delivered to the Trustee, in form satisfactory to the Trustee, the due and
punctual payment of the principal of, any premium and interest on and any
Additional Amounts with respect to all the Securities and the performance
of every other covenant of this Indenture on the part of the Company to be
performed or observed;
(2) immediately after giving effect to such transaction, no
event which, after notice or lapse of time, would become an Event of
Default, shall have occurred and be continuing;
(3) either the Company or the successor Person shall have
delivered to the Trustee an Officers' Certificate and an Opinion of
Counsel, stating that such consolidation, merger, conveyance, transfer or
lease and such supplemental indenture comply with this Article and that
all conditions precedent herein provided for relating to such transaction
have been complied with.
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Section 802. Successor Person Substituted for Company.
Upon any consolidation or merger or any conveyance, transfer or lease
of the properties and assets of the Company substantially as an entirety to any
Person in accordance with Section 801, the successor Person formed by such
consolidation or into which the Company is merged or to which such conveyance,
transfer or lease is made shall succeed to, and be substituted for, and may
exercise every right and power of, the Company under this Indenture with the
same effect as if such successor Person had been named as the Company herein;
and thereafter, except in the case of a lease to another Person, the
predecessor Person shall be released from all obligations and covenants under
this Indenture, the Securities and the Coupons.
ARTICLE NINE
SUPPLEMENTAL INDENTURES
Section 901. Supplemental Indentures without Consent of Holders.
Without the consent of any Holders of Securities or Coupons, the
Company (when authorized by or pursuant to a Board Resolution) and the Trustee,
at any time and from time to time, may enter into one or more indentures
supplemental hereto, in form satisfactory to the Trustee, for any of the
following purposes:
(1) to evidence the succession of another Person to the
Company, and the assumption by any such successor of the covenants of the
Company herein and in the Securities; or
(2) to add to the covenants of the Company for the benefit of
the Holders of all or any series of Securities (as shall be specified in
such supplemental indenture or indentures) or to surrender any right or
power herein conferred upon the Company; or
(3) to add to or change any of the provisions of this Indenture
to provide that Bearer Securities may be registrable as to principal, to
change or eliminate any restrictions on the payment of principal of, any
premium or interest on or any Additional Amounts with respect to
Securities, to permit Registered Securities to be exchanged for Bearer
Securities, to permit Bearer Securities to be exchanged for Bearer
Securities of other authorized denominations or to permit or facilitate
the issuance of Securities in uncertificated form, provided any such
action shall not adversely affect the interests of the Holders of
Securities of
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any series or any Coupons appertaining thereto in any material respect; or
(4) to establish the form or terms of Securities of any series
and any Coupons appertaining thereto as permitted by Sections 201 and 301;
or
(5) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one or
more series and to add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one Trustee, pursuant
to the requirements of Section 608; or
(6) to cure any ambiguity or to correct or supplement any
provision herein which may be defective or inconsistent with any other
provision herein, or to make any other provisions with respect to matters
or questions arising under this Indenture which shall not adversely affect
the interests of the Holders of Securities of any series or any Coupons
appertaining thereto in any material respect; or
(7) to add to, delete from or revise the conditions,
limitations and restrictions on the authorized amount, terms or purposes
of issue, authentication and delivery of Securities, as herein set forth;
or
(8) to add any additional Events of Default with respect to all
or any series of Securities (as shall be specified in such supplemental
indenture); or
(9) to supplement any of the provisions of this Indenture to
such extent as shall be necessary to permit or facilitate the defeasance
and discharge of any series of Securities pursuant to Article Four;
provided that any such action shall not adversely affect the interests of
any Holder of a Security of such series and any Coupons appertaining
thereto or any other Security or Coupon in any material respect; or
(10) to secure the Securities pursuant to Section 1006 or
otherwise;
(11) to make provision with respect to the conversion rights of
Holders of Convertible Securities pursuant to the requirements of Section
1606; or
(12) to amend or supplement any provision contained herein or
in any supplemental indenture, provided that no such amendment or
supplement shall materially adversely affect the interests of the Holders
of any Securities then Outstanding.
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Section 902. Supplemental Indentures with Consent of Holders.
With the consent of the Holders of not less than 66-2/3% in principal
amount of the Outstanding Securities of each series affected by such
supplemental indenture, by Act of said Holders delivered to the Company and the
Trustee, the Company (when authorized by or pursuant to a Company's Board
Resolution), and the Trustee may enter into an Indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this indenture or of
modifying in any manner the rights of the Holders of Securities of such series
under this Indenture; provided, however, that no such supplemental indenture,
without the consent of the Holder of each Outstanding Security affected
thereby, shall
(1) change the Stated Maturity of the principal of, or any
premium or installment of interest on or any Additional Amounts with
respect to, any Security, or reduce the principal amount thereof or the
rate of interest thereon or any Additional Amounts with respect thereto,
or any premium payable upon the redemption thereof or otherwise, or change
the obligation of the Company to pay Additional Amounts pursuant to
Section 1004 (except as contemplated by Section 801(1) and permitted by
Section 901(1)), or reduce the amount of the principal of an Original
Issue Discount Security that would be due and payable upon a declaration
of acceleration of the Maturity thereof pursuant to Section 502 or the
amount thereof provable in bankruptcy pursuant to Section 504, or
adversely affect the right of repayment at the option of any Holder as
contemplated by Article Thirteen, or change the Place of Payment, Currency
in which the principal of, any premium or interest on, or any Additional
Amounts with respect to any Security is payable, or impair the right to
institute suit for the enforcement of any such payment on or after the
Stated Maturity thereof (or, in the case of redemption, on or after the
Redemption Date or, in the case of repayment at the option of the Holder,
on or after the date for repayment), or
(2) reduce the percentage in principal amount of the
Outstanding Securities of any series, the consent of whose Holders is
required for any such supplemental indenture, or the consent of whose
Holders is required for any waiver (of compliance with certain provisions
of this Indenture or certain defaults hereunder and their consequences)
provided for in this Indenture, or reduce the requirements of Section 1504
for quorum or voting,
(3) adversely affect the right to convert any Convertible
Security, or
(4) modify any of the provisions of this Section 902, or
Section 513
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or Section 1008, except to increase any such percentage or to provide that
certain other provisions of this Indenture cannot be modified or waived
without the consent of the Holder of each Outstanding Security affected
thereby.
A supplemental indenture which changes or eliminates any covenant or
other provision of this Indenture which shall have been included expressly and
solely for the benefit of one or more particular series of Securities, or which
modifies the rights of the Holders of Securities of such series with respect to
such covenant or other provision, shall be deemed not to affect the rights
under this Indenture of the Holders of Securities of any other series.
It shall not be necessary for any Act of Holders of Securities under
this Section 902 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such Act shall approve the substance
thereof.
Section 903. Execution of Supplemental Indentures.
As a condition to executing, or accepting the additional trusts
created by, any supplemental indenture permitted by this Article or the
modifications thereby of the trust created by this Indenture, the Trustee shall
be entitled to receive, and (subject to Article Six hereof) shall be fully
protected in relying upon, an Opinion of Counsel stating that the execution of
such supplemental indenture is authorized or permitted by this Indenture. The
Trustee may, but shall not be obligated to, enter into any such supplemental
indenture which affects the Trustee's own rights, duties or immunities under
this Indenture or otherwise.
Section 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every
Holder of a Security theretofore or thereafter authenticated and delivered
hereunder and of any Coupon appertaining thereto shall be bound thereby.
Section 905. Reference in Securities to Supplemental Indentures.
Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may, and shall
if required by the Trustee, bear a notation in form approved by the Trustee as
to any matter provided for in such supplemental indenture. If the Company
shall so determine, new Securities of any series so modified as to conform, in
the opinion of the Trustee and the Company, to any such supplemental indenture
may be prepared and executed by the Company
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and authenticated and delivered by the Trustee in exchange for Outstanding
Securities of such series.
ARTICLE TEN
COVENANTS
Section 1001. Payment of Principal and any Premium, Interest and
Additional Amounts.
The Company covenants and agrees for the benefit of the Holders of
the Securities of each series that it will duly and punctually pay the
principal of, any premium and interest on and any Additional Amounts with
respect to the Securities of such series in accordance with the terms thereof,
any Coupons appertaining thereto and this Indenture. Any interest due on any
Bearer Security on or before the Maturity thereof, and any Additional Amounts
payable with respect to such interest, shall be payable only upon presentation
and surrender of the Coupons appertaining thereto for such interest as they
severally mature.
Section 1002. Maintenance of Office or Agency.
The Company shall maintain in each Place of Payment for any series of
Securities an Office or Agency where Securities of such series (but not Bearer
Securities, except as otherwise provided below, unless such Place of Payment is
located outside the United States) may be presented or surrendered for payment,
where Securities of such series may be surrendered for registration of
transfer, exchange or, if applicable, conversion and where notices and demands
to or upon the Company in respect of the Securities of such series relating
thereto and this Indenture may be served. If Securities of a series are
issuable as Bearer Securities, the Company shall maintain, subject to any laws
or regulations applicable thereto, an Office or Agency in a Place of Payment
for such series which is located outside the United States where Securities of
such series and any Coupons appertaining thereto may be presented and
surrendered for payment; provided, however, that if the Securities of such
series are listed on The Stock Exchange of the United Kingdom and the Republic
of Ireland or the Luxembourg Stock Exchange or any other stock exchange located
outside the United States and such stock exchange shall so require, the Company
shall maintain a Paying Agent in London, Luxembourg or any other required city
located outside the United States, as the case may be, so long as the
Securities of such series are listed on such exchange. 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
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required Office or Agency or shall fail to furnish the Trustee with the address
thereof, such presentations, surrenders, notices and demands may be made or
served at the Corporate Trust Office of the Trustee, except that Bearer
Securities of such series and any Coupons appertaining thereto may be presented
and surrendered for payment at the place specified for the purpose with respect
to such Securities as provided in or pursuant to this Indenture, and the
Company hereby appoints the Trustee as its agent to receive all such
presentations, surrenders, notices and demands.
Except as otherwise provided in or pursuant to this Indenture, no
payment of principal, premium, interest or Additional Amounts with respect to
Bearer Securities shall be made at any Office or Agency in the United States or
by check mailed to any address in the United States or by transfer to an
account maintained with a bank located in the United States; provided, however,
if amounts owing with respect to any Bearer Securities shall be payable in
Dollars, payment of principal of, any premium or interest on and any Additional
Amounts with respect to any such Security may be made at the Corporate Trust
Office of the Trustee or any Office or Agency designated by the Company in The
City of New York, if (but only if) payment of the full amount of such
principal, premium, interest or Additional Amounts at all offices outside the
United States maintained for such purpose by the Company in accordance with
this Indenture is illegal or effectively precluded by exchange controls or
other similar restrictions.
The Company may also from time to time designate one or more other
Offices or Agencies where the Securities of one or more series may be presented
or surrendered for any or all such purposes and may from time to time rescind
such designations; provided, however, that no such designation or rescission
shall in any manner relieve the Company of its obligation to maintain an Office
or Agency in each Place of Payment for Securities of any series for such
purposes. The Company shall give prompt written notice to the Trustee of any
such designation or rescission and of any change in the location of any such
other Office or Agency. Unless otherwise provided in or pursuant to this
Indenture, the Company hereby designates as the Place of Payment for each
series The City of New York, and initially appoints the Office or Agency of the
Corporate Trust Office of the Trustee for such purpose. Pursuant to Section
301(9) of this Indenture, the Company may subsequently appoint a place or
places in The City of New York where such Securities may be payable.
Section 1003. Money for Securities Payments to Be Held in Trust.
If the Company shall at any time act as its own Paying Agent with
respect to any series of Securities, it shall, on or before each due date of
the principal of, any premium or interest on or Additional Amounts with respect
to any of the Securities of such series, segregate and hold in trust for the
benefit of the Persons entitled thereto a sum of money sufficient to pay the
principal or any premium, interest or Additional
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Amounts so becoming due until such sums shall be paid to such Persons or
otherwise disposed of as herein provided, and shall promptly notify the Trustee
of its action or failure so to act.
Whenever the Company shall have one or more Paying Agents for any
series of Securities, it shall, on or prior to each due date of the principal
of, any premium or interest on or any Additional Amounts with respect to any
Securities of such series, deposit with any Paying Agent a sum of money
sufficient to pay the principal or any premium, interest or Additional Amounts
so becoming due, such sum to be held in trust for the benefit of the Persons
entitled thereto, and (unless such Paying Agent is the Trustee) the Company
will promptly notify the Trustee of its action or failure so to act.
The Company shall cause each Paying Agent for any series of
Securities other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent shall:
(1) hold all sums held by it for the payment of the principal
of, any premium or interest on or any Additional Amounts with respect to
Securities of such series in trust for the benefit of the Persons entitled
thereto until such sums shall be paid to such Persons or otherwise
disposed of as provided in or pursuant to this Indenture;
(2) give the Trustee notice of any default by the Company (or
any other obligor upon the Securities of such series) in the making of any
payment of principal, any premium or interest on or any Additional Amounts
with respect to the Securities of such series; and
(3) at any time during the continuance of any such default,
upon the written request of the Trustee, forthwith pay to the Trustee all
sums so held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held
in trust by the Company or such Paying Agent, such sums to be held by the
Trustee upon the same terms as those upon which such sums were held by the
Company or such Paying Agent; and, upon such payment by any Paying Agent to the
Trustee, such Paying Agent shall be released from all further liability with
respect to such money.
Except as otherwise provided herein or pursuant hereto, any money
deposited with the Trustee or any Paying Agent, or then held by the Company, in
trust
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for the payment of the principal of, any premium or interest on or any
Additional Amounts with respect to any Security of any series and remaining
unclaimed for two years after such principal or any such premium or interest or
any such Additional Amounts shall have become due and payable shall be paid to
the Company on Company Request, or (if then held by the Company) shall be
discharged from such trust; and the Holder of such Security or any Coupon
appertaining thereto shall thereafter, as an unsecured general creditor, look
only to the Company for payment thereof, and all liability of the Trustee or
such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Company cause to be published once, in an Authorized
Newspaper in each Place of Payment for such series or to be mailed to Holders
of Registered Securities of such series, or both, 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 nor shall it be
later than two years after such principal and any premium or interest or
Additional Amounts shall have become due and payable, any unclaimed balance of
such money then remaining will be repaid to the Company.
Section 1004. Additional Amounts.
If any Securities of a series provide for the payment of Additional
Amounts, the Company agrees to pay to the Holder of any such Security or any
Coupon appertaining thereto Additional Amounts as provided therein. Whenever
in this Indenture there is mentioned, in any context, the payment of the
principal of or any premium or interest on, or in respect of, any Security of
any series or any Coupon or the net proceeds received on the sale or exchange
of any Security of any series, such mention shall be deemed to include mention
of the payment of Additional Amounts provided by the terms of such series
established hereby or pursuant hereto to the extent that, in such context,
Additional Amounts are, were or would be payable in respect thereof pursuant to
such terms, and express mention of the payment of Additional Amounts (if
applicable) in any provision hereof shall not be construed as excluding
Additional Amounts in those provisions hereof where such express mention is not
made.
Except as otherwise provided in or pursuant to this Indenture, if the
Securities of a series provide for the payment of Additional Amounts, at least
10 days prior to the first Interest Payment Date with respect to such series of
Securities (or if the Securities of such series shall not bear interest prior
to Maturity, the first day on which a payment of principal is made), and at
least 10 days prior to each date of payment of principal or interest if there
has been any change with respect to the matters set forth in the
below-mentioned Officers' Certificate, the Company shall furnish to the Trustee
and the principal Paying Agent or Paying Agents, if other than the Trustee, an
Officers'
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Certificate instructing the Trustee and such Paying Agent or Paying Agents
whether such payment of principal of or interest on the Securities of such
series shall be made to Holders of Securities of such series or the Coupons
appertaining thereto who are United States Aliens without withholding for or on
account of any tax, assessment or other governmental charge described in the
Securities of such series. If any such withholding shall be required, then
such Officers' Certificate shall specify by country the amount, if any,
required to be withheld on such payments to such Holders of Securities or
Coupons, and the Company agrees to pay to the Trustee or such Paying Agent the
Additional Amounts required by the terms of such Securities. The Company
covenants to indemnify the Trustee and any Paying Agent for, and to hold them
harmless against, any loss, liability or expense (including reasonable fees and
expenses) reasonably incurred without negligence or bad faith on their part
arising out of or in connection with actions taken or omitted by any of them in
reliance on any Officers' Certificate furnished pursuant to this Section 1004.
Section 1005. Limitation Upon Disposition of Voting Stock of
Significant Subsidiaries.
So long as any of the Securities shall be Outstanding, the Company:
(a) will not, nor will it permit any Subsidiary to, sell,
assign, transfer or otherwise dispose of any shares of, securities
convertible into or options, warrants or rights to subscribe for or
purchase shares of, Voting Stock of a Significant Subsidiary, and will not
permit a Significant Subsidiary to issue any shares of, or securities
convertible into or options, warrants or rights to subscribe for or
purchase shares of, such Voting Stock if, in each case, after giving
effect to any such transaction and to the issuance of the maximum number
of shares of Voting Stock of such Significant Subsidiary issuable upon the
exercise of all such convertible securities, options, warrants or rights,
such Significant Subsidiary would cease to be a Controlled Subsidiary, or
(b) will not permit a Significant Subsidiary to
(i) merge or consolidate with or into any other
corporation, unless the surviving corporation is the Company or is,
or upon consummation of the merger or consolidation will become, a
Controlled Subsidiary; or
(ii) lease, sell or transfer all or substantially all of
its properties and assets to any corporation or other Person, except
to the Company or to a Controlled Subsidiary or a Person that, upon
such lease, sale or transfer, will become a Controlled Subsidiary.
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Notwithstanding the foregoing, any such sale, assignment or transfer
of securities, any such merger or consolidation or any such lease, sale or
transfer of properties and assets shall not be prohibited if required (i) by
any law or any rule, regulation or order of any governmental agency or
authority or (ii) as a condition imposed by any law or any rule, regulation or
order of any governmental agency or authority to the acquisition by the
Company, directly or indirectly, through purchase of stock or assets, merger,
consolidation or otherwise, of any Person, provided that, after giving effect
to such disposition and acquisition, (A) such Person will be a Controlled
Subsidiary, and (B) the Consolidated Assets of the Company will be at least
equal to the Consolidated Assets of the Company prior thereto.
Section 1006. Limitation on Creation of Liens.
So long as any of the Securities shall be outstanding, the Company
will not, nor will it permit any Subsidiary to, create, assume, incur or suffer
to be created, assumed or incurred or to exist any pledge, encumbrance or lien,
as security for indebtedness for borrowed money, upon any shares of, or
securities convertible into or options, warrants or rights to subscribe for or
purchase shares of, Voting Stock of a Significant Subsidiary, directly or
indirectly, without making effective provision whereby the Securities of all
series shall be equally and ratably secured with any and all such indebtedness
if, treating such pledge, encumbrance or lien as a transfer of the shares of,
or securities convertible into or options, warrants or rights to subscribe for
or purchase shares of, Voting Stock subject thereto to the secured party and to
the issuance of the maximum number of shares of Voting Stock of such
Significant Subsidiary issuable upon the exercise of all such convertible
securities, options, warrants or rights, such Significant Subsidiary would not
continue to be a Controlled Subsidiary.
Section 1007. Corporate Existence.
Subject to Article Eight, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its corporate
existence and the corporate existence of each Significant Subsidiary and its
rights (charter and statutory) and franchises and those of each such
Significant Subsidiary; provided, however, that neither the Company nor any
Significant Subsidiary shall be required to preserve any such right or
franchise if the Company or such Significant Subsidiary, as the case may be,
shall determine that the preservation thereof is no longer desirable in the
conduct of its business and that the loss thereof is not disadvantageous in any
material respect to the Holders.
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Section 1008. Waiver of Certain Covenants.
The Company may omit in any particular instance to comply with any
term, provision or condition set forth in Section 1005, 1006 or 1007 with
respect to the Securities of any series if before the time for such compliance
the Holders of at least a majority in principal amount of the Outstanding
Securities of such series, by Act of such Holders, either shall waive such
compliance in such instance or generally shall have waived compliance with such
term, provision or condition, but no such waiver shall extend to or affect such
term, provision or condition except to the extent so expressly waived, and,
until such waiver shall become effective, the obligations of the Company and
the duties of the Trustee in respect of any such term, provision or condition
shall remain in full force and effect.
Section 1009. Company Statement as to Compliance; Notice of Certain
Defaults.
(a) The Company shall deliver to the Trustee, within 120 days after
the end of each fiscal year, a written statement (which need not be contained
in or accompanied by an Officers' Certificate) signed by the principal
executive officer, the principal financial officer or the principal accounting
officer of the Company, stating that
(1) a review of the activities of the Company during such year
and of its performance under this Indenture has been made under his or her
supervision, and
(2) to the best of his or her knowledge, based on such review,
(a) the Company has complied with all the conditions and covenants imposed
on it under this Indenture throughout such year, or, if there has been a
default in the fulfillment of any such condition or covenant, specifying
each such default known to him or her and the nature and status thereof,
and (b) no event has occurred and is continuing which is, or after notice
or lapse of time or both would become, an Event of Default, or, if such an
event has occurred and is continuing, specifying each such event known to
him and the nature and status thereof.
(b) The Company shall deliver to the Trustee, within five days after
the occurrence thereof, written notice of any event which after notice or lapse
of time or both would become an Event of Default pursuant to clause (4) of
Section 501.
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ARTICLE ELEVEN
REDEMPTION OF SECURITIES
Section 1101. Applicability of Article.
Redemption of Securities of any series at the option of the Company
as permitted or required by the terms of such Securities shall be made in
accordance with the terms of such Securities and (except as otherwise provided
herein or pursuant hereto) this Article.
Section 1102. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be
evidenced by or pursuant to a Board Resolution. In case of any redemption at
the election of the Company of the Securities of any series, with the same
issue date, interest rate, Stated Maturity and other terms, the Company shall,
at least 60 days prior to the Redemption Date fixed by the Company (unless a
shorter notice shall be satisfactory to the Trustee), notify the Trustee of
such Redemption Date and of the principal amount of Securities of such series
to be redeemed.
Section 1103. Selection by Trustee of Securities to be Redeemed.
If less than all the Securities of any series with the same issue
date, interest rate, Stated Maturity and other terms are to be redeemed, the
particular Securities to be redeemed shall be selected not more than 60 days
prior to the Redemption Date by the Trustee from the Outstanding Securities of
such series not previously called for redemption, by such method as the Trustee
shall deem fair and appropriate and which may provide for the selection for
redemption of portions of the principal amount of Registered Securities of such
series; provided, however, that no such partial redemption shall reduce the
portion of the principal amount of a Registered Security of such series not
redeemed to less than the minimum denomination for a Security of such series
established herein or pursuant hereto.
If any Convertible Security selected for partial redemption is
converted in part before termination of the conversion right with respect to
the portion of the Security so selected, the converted portion of such Security
shall be deemed (so far as may be) to be the portion selected for redemption.
Securities which have been converted during a selection of Securities to be
redeemed shall be treated by the Trustee as Outstanding for the purpose of such
selection.
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The Trustee shall promptly notify the Company and the Security
Registrar (if other than itself) in writing of the Securities selected for
redemption and, in the case of any Securities selected for partial redemption,
the principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Securities redeemed or to be redeemed only in part, to the
portion of the principal of such Securities which has been or is to be
redeemed.
Section 1104. Notice of Redemption.
Notice of redemption shall be given in the manner provided in Section
106, not less than 30 nor more than 60 days prior to the Redemption Date,
unless a shorter period is specified in the Securities to be redeemed, to the
Holders of Securities to be redeemed. Failure to give notice by mailing in the
manner herein provided to the Holder of any Registered Securities designated
for redemption as a whole or in part, or any defect in the notice to any such
Holder, shall not affect the validity of the proceedings for the redemption of
any other Securities or portion thereof.
Any notice that is mailed to the Holder of any Registered Securities
in the manner herein provided shall be conclusively presumed to have been duly
given, whether or not such Holder receives the notice.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all Outstanding Securities of any series are
to be redeemed, the identification (and, in the case of partial
redemption, the principal amount) of the particular Security or Securities
to be redeemed,
(4) in case any Security is to be redeemed in part only, the
notice which relates to such Security shall state that on and after the
Redemption Date, upon surrender of such Security, the Holder of such
Security will receive, without charge, a new Security or Securities of
authorized denominations for the principal amount thereof remaining
unredeemed,
(5) that, on the Redemption Date, the Redemption Price shall
become due and payable upon each such Security or portion thereof to be
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redeemed, and, if applicable, that interest thereon shall cease to accrue
on and after said date,
(6) in the case of Convertible Securities, the Conversion Price
then in effect, the date on which the right to convert the principal
amount of the Securities or the portions thereof to be redeemed will
terminate and the place or places where such Securities may be surrendered
for conversion,
(7) the place or places where such Securities, together (in the
case of Bearer Securities) with all Coupons appertaining thereto, if any,
maturing after the Redemption Date, are to be surrendered for payment of
the Redemption Price and any accrued interest and Additional Amounts
pertaining thereto,
(8) that the redemption is for a sinking fund, if such is the
case,
(9) that, unless otherwise specified in such notice, Bearer
Securities of any series, if any, surrendered for redemption must be
accompanied by all Coupons maturing subsequent to the date fixed for
redemption or the amount of any such missing Coupon or Coupons will be
deducted from the Redemption Price, unless security or indemnity
satisfactory to the Company, the Trustee and any Paying Agent is
furnished,
(10) if Bearer Securities of any series are to be redeemed and
any Registered Securities of such series are not to be redeemed, and if
such Bearer Securities may be exchanged for Registered Securities not
subject to redemption on the Redemption Date pursuant to Section 305 or
otherwise, the last date, as determined by the Company, on which such
exchanges may be made, and
(11) the CUSIP number or the Euro-clear or the CEDEL reference
numbers of such Securities, if any (or any other numbers used by a
Depository to identify such Securities).
A notice of redemption published as contemplated by Section 106 need
not identify particular Registered Securities to be redeemed.
Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company.
Section 1105. Deposit of Redemption Price.
On or prior to any Redemption Date, the Company shall deposit with the
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Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 1003) an amount of
money sufficient to pay the Redemption Price of, and (except if the Redemption
Date shall be an Interest Payment Date) any accrued interest on and Additional
Amounts with respect thereto, all the Securities or portions thereof which are
to be redeemed on that date.
If any Convertible Security or portion thereof called for redemption
is converted pursuant to Article Sixteen, any money deposited with the Trustee
or so segregated and held in trust for the redemption of such Security or
portion thereof shall (subject to any right of the Holder of the Security on a
Regular Record Date preceding such conversion to receive interest) be paid to
the Company upon Company Request or, if then held by the Company, shall be
discharged from such trust.
Section 1106. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities
so to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cease to bear interest and the Coupons for such
interest appertaining to any Bearer Securities so to be redeemed, except to the
extent provided below, shall be void. Upon surrender of any such Security for
redemption in accordance with said notice, together with all Coupons, if any,
appertaining thereto maturing after the Redemption Date, such Security shall be
paid by the Company at the Redemption Price, together with any accrued interest
and Additional Amounts to the Redemption Date; provided, however, that
installments of interest on Bearer Securities whose Stated Maturity is on or
prior to the Redemption Date shall be payable only upon presentation and
surrender of Coupons for such interest (at an Office or Agency located outside
the United States except as otherwise provided in Section 1002), and provided,
further, that installments of interest on Registered Securities whose Stated
Maturity is on or prior to the Redemption Date shall be payable to the Holders
of such Securities, or one or more Predecessor Securities, registered as such
at the close of business on the Regular Record Dates therefor according to
their terms and the provisions of Section 307.
If any Bearer Security surrendered for redemption shall not be
accompanied by all appurtenant Coupons maturing after the Redemption Date, such
Security may be paid after deducting from the Redemption Price an amount equal
to the face amount of all such missing Coupons, or the surrender of such
missing Coupon or Coupons may be waived by the Company and the Trustee if there
be furnished to them such security or indemnity as they may require to save
each of them and any Paying Agent harmless. If thereafter the Holder of such
Security shall surrender to the Trustee or any Paying Agent any such missing
Coupon in respect of which a deduction shall
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have been made from the Redemption Price, such Holder shall be entitled to
receive the amount so deducted; provided, however, that any interest or
Additional Amounts represented by Coupons shall be payable only upon
presentation and surrender of those Coupons at an Office or Agency for such
Security located outside of the United States except as otherwise provided in
Section 1002.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal and any premium, until paid,
shall bear interest from the Redemption Date at the rate prescribed therefor in
the Security.
Section 1107. Securities Redeemed in Part.
Any Registered Security which is to be redeemed only in part shall be
surrendered at any Office or Agency for such Security (with, if the Company or
the Trustee so requires, due endorsement by, or a written instrument of
transfer in form satisfactory to the Company and the Trustee duly executed by,
the Holder thereof or his attorney duly authorized in writing) and the Company
shall execute and the Trustee shall authenticate and deliver to the Holder of
such Security without service charge, a new Registered Security or Securities
of the same series, containing identical terms and provisions, of any
authorized denomination as requested by such Holder in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of
the Security so surrendered. If a Security in global form is so surrendered,
the Company shall execute, and the Trustee shall authenticate and deliver to
the U.S. Depository or other Depository for such Security in global form as
shall be specified in the Company Order with respect thereto to the Trustee,
without service charge, a new Security in global form in a denomination equal
to and in exchange for the unredeemed portion of the principal of the Security
in global form so surrendered.
Section 1108. Conversion Arrangements on Call for Redemption.
Notwithstanding anything to the contrary contained in this Indenture, in
connection with any redemption of Convertible Securities of any series, the
Company, by an agreement with one or more investment bankers or other
purchasers, may arrange for such purchasers to purchase all such Convertible
Securities called for redemption (the "Called Securities") which are either (i)
surrendered for redemption or (ii) not duly surrendered for redemption or
conversion prior to the close of business on the Redemption Date, and to
convert the same into shares of Common Stock, by the purchasers' depositing
with the Trustee (acting as Paying Agent with respect to the deposit of such
amount and as conversion agent with respect to the conversion of such Called
Securities), in trust for the Holders of the Called Securities, on or prior to
the Redemption Date in the manner agreed to by the Company and such purchasers,
an amount sufficient to pay the Redemption Price, payable by the Company on
redemption
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of such Called Securities. In connection with any such arrangement for
purchase and conversion, the Trustee as Paying Agent shall pay on or after the
Redemption Date such amounts so deposited by the purchasers in exchange for
Called Securities surrendered for redemption prior to the close of business on
the Redemption Date and for all Called Securities surrendered after such
Redemption Date. Notwithstanding anything to the contrary contained in this
Article Eleven, the obligation of the Company to pay the Redemption Price of
such Called Securities shall be satisfied and discharged to the extent such
amount is so paid by such purchasers, provided, however, that nothing in this
Section 1108 shall in any way relieve the Company of the obligation to pay such
Redemption Price on all Called Securities to the extent such amount is not so
paid by said purchasers. For all purposes of this Indenture, any Called
Securities surrendered by the Holders for redemption, and any Called Securities
not duly surrendered for redemption or conversion prior to the close of
business on the Redemption Date, shall be deemed acquired by such purchasers
from such Holders and surrendered by such purchasers for conversion and shall
in all respects be deemed to have been converted, all as of immediately prior
to the close of business on the Redemption Date, subject to the deposit by the
purchasers of the above amount as aforesaid. Nothing in this Section 1108
shall in any way limit the right of any Holder of a Security to convert his
Security pursuant to the terms of this Indenture and of such Security at any
time prior to the close of business on the Redemption Date applicable thereto.
ARTICLE TWELVE
SINKING FUNDS
Section 1201. Applicability of Article.
The provisions of this Article shall be applicable to any sinking
fund for the retirement of Securities of a series, except as otherwise
permitted or required by any form of Security of such series issued pursuant to
this Indenture.
The minimum amount of any sinking fund payment provided for by the
terms of Securities of any series is herein referred to as a "mandatory sinking
fund payment", and any payment in excess of such minimum amount provided for by
the terms of Securities of such series is herein referred to as an "optional
sinking fund payment". If provided for by the terms of Securities of any
series, the cash amount of any sinking fund payment may be subject to reduction
as provided in Section 1202. Each sinking fund payment shall be applied to the
redemption of Securities of any series as provided for by the terms of
Securities of such series.
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Section 1202. Satisfaction of Sinking Fund Payments with Securities.
The Company may, in satisfaction of all or any part of any sinking
fund payment with respect to the Securities of any series to be made pursuant
to the terms of such Securities (1) deliver Outstanding Securities of such
series (other than any of such Securities previously called for redemption or
any of such Securities in respect of which cash shall have been released to the
Company), together in the case of any Bearer Securities of such series with all
unmatured Coupons appertaining thereto, and (2) apply as a credit Securities of
such series which have been redeemed either at the election of the Company
pursuant to the terms of such series of Securities or through the application
of permitted optional sinking fund payments pursuant to the terms of such
Securities or which have been surrendered for conversion pursuant to Article
Sixteen, provided that such series of Securities have not been previously so
credited. Such Securities shall be received and credited for such purpose by
the Trustee at the Redemption Price specified in such Securities for redemption
through operation of the sinking fund and the amount of such sinking fund
payment shall be reduced accordingly. If as a result of the delivery or credit
of Securities of any series in lieu of cash payments pursuant to this Section
1202, the principal amount of Securities of such series to be redeemed in order
to exhaust the aforesaid cash payment shall be less than $100,000, the Trustee
need not call Securities of such series for redemption, except upon Company
Request, and such cash payment shall be held by the Trustee or a Paying Agent
and applied to the next succeeding sinking fund payment, provided, however,
that the Trustee or such Paying Agent shall at the request of the Company from
time to time pay over and deliver to the Company any cash payment so being held
by the Trustee or such Paying Agent upon delivery by the Company to the Trustee
of Securities of that series purchased by the Company having an unpaid
principal amount equal to the cash payment requested to be released to the
Company.
Section 1203. Redemption of Securities for Sinking Fund.
Not less than 45 days prior to each sinking fund payment date for any
series of Securities (unless a shorter notice shall be satisfactory to the
Trustee), the Company shall deliver to the Trustee an Officers' Certificate
specifying the amount of the next ensuing mandatory sinking fund payment for
that series pursuant to the terms of that series, the portion thereof, if any,
which is to be satisfied by payment of cash and the portion thereof, if any,
which is to be satisfied by delivering and crediting of Securities of that
series pursuant to Section 1202, and the optional amount, if any, to be added
in cash to the next ensuing mandatory sinking fund payment, and will also
deliver to the Trustee any Securities to be so credited and not theretofore
delivered. If such Officers' Certificate shall specify an optional amount to
be added in cash to the next ensuing mandatory sinking fund payment, the
Company shall thereupon be obligated to pay the amount therein specified. Not
less than 40 days before each such sinking
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fund payment date the Trustee shall select the Securities to be redeemed upon
such sinking fund payment date in the manner specified in Section 1103 and
cause notice of the redemption thereof to be given not less than 30 nor more
than 40 days prior to the sinking fund payment date in the name of and at the
expense of the Company in the manner provided in Section 1104. Such notice
having been duly given, the redemption of such Securities shall be made upon
the terms and in the manner stated in Sections 1106 and 1107.
ARTICLE THIRTEEN
REPAYMENT AT THE OPTION OF HOLDERS
Section 1301. Applicability of Article.
Securities of any series which are repayable at the option of the
Holders thereof before their Stated Maturity shall be repaid in accordance with
the terms of the Securities of such series. The repayment of any principal
amount of Securities pursuant to such option of the Holder to require repayment
of Securities before their Stated Maturity, for purposes of Section 309, shall
not operate as a payment, redemption or satisfaction of the indebtedness
represented by such Securities unless and until the Company, at its option,
shall deliver or surrender the same to the Trustee with a directive that such
Securities be cancelled. Notwithstanding anything to the contrary contained in
this Section 1301, in connection with any repayment of Securities, the Company
may arrange for the purchase of any Securities by an agreement with one or more
investment bankers or other purchasers to purchase such Securities by paying to
the Holders of such Securities on or before the close of business on the
repayment date an amount not less than the repayment price payable by the
Company on repayment of such Securities, and the obligation of the Company to
pay the repayment price of such Securities shall be satisfied and discharged to
the extent such payment is so paid by such purchasers.
ARTICLE FOURTEEN
SECURITIES IN FOREIGN CURRENCIES
Section 1401. Applicability of Article.
Whenever this Indenture provides for (i) any action by, or the
determination of any of the rights of, Holders of Securities of any series in
which not all of such
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Securities are denominated in the same Currency, or (ii) any distribution to
Holders of Securities, in the absence of any provision to the contrary in the
form of Security of any particular series, any amount in respect of any
Security denominated in a Currency other than Dollars shall be treated for any
such action or distribution as that amount of Dollars that could be obtained
for such amount on such reasonable basis of exchange and as of the record date
with respect to Registered Securities of such series (if any) for such action,
determination of rights or distribution (or, if there shall be no applicable
record date, such other date reasonably proximate to the date of such action,
determination of rights or distribution) as the Company may specify in a
written notice to the Trustee or, in the absence of such written notice, as the
Trustee may determine.
ARTICLE FIFTEEN
MEETINGS OF HOLDERS OF SECURITIES
Section 1501. Purposes for Which Meetings May Be Called.
A meeting of Holders of Securities of any series may be called at any
time and from time to time pursuant to this Article to make, give or take any
request, demand, authorization, direction, notice, consent, waiver or other
action provided by this Indenture to be made, given or taken by Holders of
Securities of such series.
Section 1502. Call, Notice and Place of Meetings.
(a) The Trustee may at any time call a meeting of Holders of
Securities of any series for any purpose specified in Section 1501, to be held
at such time and at such place in The City of New York, or, if Securities of
such series have been issued in whole or in part as Bearer Securities, in
London or in such place outside the United States as the Trustee shall
determine. Notice of every meeting of Holders of Securities of any series,
setting forth the time and the place of such meeting and in general terms the
action proposed to be taken at such meeting, shall be given, in the manner
provided in Section 106, not less than 21 nor more than 180 days prior to the
date fixed for the meeting.
(b) In case at any time the Company (by or pursuant to a Board
Resolution) or the Holders of at least 10% in principal amount of the
Outstanding Securities of any series shall have requested the Trustee to call a
meeting of the Holders of Securities of such series for any purpose specified
in Section 1501, by written request setting forth in reasonable detail the
action proposed to be taken at the meeting, and the Trustee shall not have made
the first publication of the notice of such meeting within 21
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days after receipt of such request or shall not thereafter proceed to cause the
meeting to be held as provided herein, then the Company or the Holders of
Securities of such series in the amount above specified, as the case may be,
may determine the time and the place in The City of New York, or, if Securities
of such series are to be issued as Bearer Securities, in London for such
meeting and may call such meeting for such purposes by giving notice thereof as
provided in subsection (a) of this Section 1502.
Section 1503. Persons Entitled to Vote at Meetings.
To be entitled to vote at any meeting of Holders of Securities of any
series, a Person shall be (1) a Holder of one or more Outstanding Securities of
such series, or (2) a Person appointed by an instrument in writing as proxy for
a Holder or Holders of one or more Outstanding Securities of such series by
such Holder or Holders. The only Persons who shall be entitled to be present
or to speak at any meeting of Holders of Securities of any series shall be the
Persons entitled to vote at such meeting and their counsel, any representatives
of the Trustee and its counsel and any representatives of the Company and its
counsel.
Section 1504. Quorum; Action.
The Persons entitled to vote a majority in principal amount of the
Outstanding Securities of a series shall constitute a quorum for a meeting of
Holders of Securities of such series; provided, however, that if any action is
to be taken at such meeting with respect to a consent or waiver which this
Indenture expressly provides may be given by the Holders of not less than
66-2/3% in principal amount of the Outstanding Securities of a series, the
Persons entitled to vote 66-2/3% in principal amount of the Outstanding
Securities of such series shall constitute a quorum. In the absence of a
quorum within 30 minutes after the time appointed for any such meeting, the
meeting shall, if convened at the request of Holders of Securities of such
series, be dissolved. In any other case the meeting may be adjourned for a
period of not less than 10 days as determined by the chairman of the meeting
prior to the adjournment of such meeting. In the absence of a quorum at any
such adjourned meeting, such adjourned meeting may be further adjourned for a
period of not less than 10 days as determined by the chairman of the meeting
prior to the adjournment of such adjourned meeting. Notice of the reconvening
of any adjourned meeting shall be given as provided in Section 1502(a), except
that such notice need be given only once not less than five days prior to the
date on which the meeting is scheduled to be reconvened. Notice of the
reconvening of an adjourned meeting shall state expressly the percentage, as
provided above, of the principal amount of the Outstanding Securities of such
series which shall constitute a quorum.
Except as limited by the proviso to Section 902, any resolution presented
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to a meeting or adjourned meeting duly reconvened at which a quorum is present
as aforesaid may be adopted only by the affirmative vote of the Holders of a
majority in principal amount of the Outstanding Securities of that series;
provided, however, that, except as limited by the proviso to Section 902, any
resolution with respect to any consent or waiver which this Indenture expressly
provides may be given by the Holders of not less than 66-2/3% in principal
amount of the Outstanding Securities of a series may be adopted at a meeting or
an adjourned meeting duly convened and at which a quorum is present as
aforesaid only by the affirmative vote of the Holders of 66-2/3% in principal
amount of the Outstanding Securities of that series; and provided, further,
that, except as limited by the proviso to Section 902, any resolution with
respect to any request, demand, authorization, direction, notice, consent,
waiver or other action which this Indenture expressly provides may be made,
given or taken by the Holders of a specified percentage, which is less than a
majority, in principal amount of the Outstanding Securities of a series may be
adopted at a meeting or an adjourned meeting duly reconvened and at which a
quorum is present as aforesaid by the affirmative vote of the Holders of such
specified percentage in principal amount of the Outstanding Securities of such
series.
Any resolution passed or decision taken at any meeting of Holders of
Securities of any series duly held in accordance with this Section 1504 shall
be binding on all the Holders of Securities of such series and the Coupons
appertaining thereto, whether or not such Holders were present or represented
at the meeting.
Section 1505. Determination of Voting Rights; Conduct and
Adjournment of Meetings.
(a) Notwithstanding any other provisions of this Indenture, the
Trustee may make such reasonable regulations as it may deem advisable for any
meeting of Holders of Securities of such series in regard to proof of the
holding of Securities of such series and of the appointment of proxies and in
regard to the appointment and duties of inspectors of votes, the submission and
examination of proxies, certificates and other evidence of the right to vote,
and such other matters concerning the conduct of the meeting as it shall deem
appropriate. Except as otherwise permitted or required by any such
regulations, the holding of Securities shall be proved in the manner specified
in Section 104 and the appointment of any proxy shall be proved in the manner
specified in Section 104 or by having the signature of the person executing the
proxy witnessed or guaranteed by any trust company, bank or banker authorized
by Section 104 to certify to the holding of Bearer Securities. Such
regulations may provide that written instruments appointing proxies, regular on
their face, may be presumed valid and genuine without the proof specified in
Section 104 or other proof.
(b) The Trustee shall, by an instrument in writing, appoint a temporary
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chairman of the meeting, unless the meeting shall have been called by the
Company or by Holders of Securities as provided in Section 1502(b), in which
case the Company or the Holders of Securities of the series calling the
meeting, as the case may be, shall in like manner appoint a temporary chairman.
A permanent chairman and a permanent secretary of the meeting shall be elected
by vote of the Persons entitled to vote a majority in principal amount of the
Outstanding Securities of such series represented at the meeting.
(c) At any meeting, each Holder of a Security of such series or
proxy shall be entitled to one vote for each $1,000 principal amount of
Securities of such series held or represented by him; provided, however, that
no vote shall be cast or counted at any meeting in respect of any Security
challenged as not Outstanding and ruled by the chairman of the meeting to be
not Outstanding. The chairman of the meeting shall have no right to vote,
except as a Holder of a Security of such series or proxy.
(d) Any meeting of Holders of Securities of any series duly called
pursuant to Section 1502 at which a quorum is present may be adjourned from
time to time by Persons entitled to vote a majority in principal amount of the
Outstanding Securities of such series represented at the meeting; and the
meeting may be held as so adjourned without further notice.
Section 1506. Counting Votes and Recording Action of Meetings.
The vote upon any resolution submitted to any meeting of Holders of
Securities of any series shall be by written ballots on which shall be
subscribed the signatures of the Holders of Securities of such series or of
their representatives by proxy and the principal amounts and serial numbers of
the Outstanding Securities of such series held or represented by them. The
permanent chairman of the meeting shall appoint two inspectors of votes who
shall count all votes cast at the meeting for or against any resolution and who
shall make and file with the secretary of the meeting their verified written
reports in triplicate of all votes cast at the meeting. A record, at least in
triplicate, of the proceedings of each meeting of Holders of Securities of any
series shall be prepared by the secretary of the meeting and there shall be
attached to said record the original reports of the inspectors of votes on any
vote by ballot taken thereat and affidavits by one or more persons having
knowledge of the facts setting forth a copy of the notice of the meeting and
showing that said notice was given as provided in Section 1502 and, if
applicable, Section 1504. Each copy shall be signed and verified by the
affidavits of the permanent chairman and secretary of the meeting and one such
copy shall be delivered to the Company, and another to the Trustee to be
preserved by the Trustee, the latter to have attached thereto the ballots voted
at the meeting. Any record so signed and verified shall be conclusive evidence
of the matters therein stated.
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ARTICLE SIXTEEN
CONVERSION
Section 1601. Conversion Privilege.
Subject to and upon compliance with the provisions of this Article
Sixteen and the terms of the Convertible Securities of the series proposed to
be converted, at the option of the Holder, any Convertible Security or any
portion of the principal amount thereof which is $1,000 or an integral multiple
thereof, may be converted into shares of Common Stock, as said shares shall be
constituted at the Date of Conversion, at the Conversion Price for such
Convertible Securities of such series in effect at the Date of Conversion.
Section 1602. Manner of Exercise of Conversion Privilege.
In order to exercise the conversion privilege, the Holder of any
Convertible Security to be converted shall surrender such Convertible Security
to the Company at its office or agency in The City of New York, together with
the conversion notice in the form provided on the Securities (or separate
written notice) duly executed, and, if so required by the Company, accompanied
by instruments of transfer, in form satisfactory to the Company and to the
Trustee, duly executed by the Holder or by his duly authorized attorney in
writing. Any Registered Convertible Security so surrendered during the period
from the close of business on the Regular Record Date preceding an Interest
Payment Date for such Registered Convertible Security to the opening of
business on such Interest Payment Date shall (unless any such Registered
Convertible Security or the portion thereof being converted shall have been
called for redemption on a Redemption Date during such period, in which event
no interest shall be payable with respect to such Registered Convertible
Security or portion thereof, as the case may be, following such Redemption
Date) also be accompanied by payment in New York Clearing House funds or other
funds acceptable to the Company of an amount equal to the interest payable on
such Interest Payment Date on the principal amount of such Registered
Convertible Security then being converted; provided, however, that no such
payment need be made if there shall exist, at the time of conversion, a default
in the payment of interest on the Convertible Securities of such series.
Except as provided in the immediately preceding sentence, no adjustment shall
be made for interest accrued on any Convertible Security that shall be
converted or for dividends on any shares of Common Stock that shall be
delivered upon the conversion of such Convertible Securities. The funds so
delivered to such office or agency shall be paid to the Company on or after
such Interest Payment Date, unless the Company shall default in the payment of
the interest due on such Interest Payment Date, in which event such funds shall
be repaid to the Person who delivered the same. As promptly as practicable
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after the surrender of any Convertible Security for conversion as aforesaid,
the Company shall deliver at said office or agency to such Holder, or on his
written order, a certificate or certificates for the number of full shares
deliverable upon the conversion of such Convertible Security or portion thereof
and a check or cash in respect of any fraction of a share of Common Stock
otherwise deliverable upon such conversion, all as provided in this Article
Sixteen, together with a Convertible Security or Convertible Securities of the
same series in principal amount equal to the unconverted and unredeemed
portion, if any, of the Convertible Security so converted in accordance with
Section 305 hereof. Such conversion shall be deemed to have been effected on
the date on which such notice shall have been received at said office or agency
and such Convertible Security shall have been surrendered as aforesaid, and the
Person or Persons in whose name or names any certificate or certificates, for
shares of Common Stock shall be deliverable upon such conversion shall be
deemed to have become on said date the Holder or Holders of record of the
shares represented thereby, provided, however, that any such surrender on any
date when the stock transfer books of the Company shall be closed shall
constitute the Person or Persons in whose name or names the certificates are to
be delivered as the record Holder or Holders thereof for all purposes on the
next succeeding day on which such stock transfer books are open, but such
conversion shall be at the Conversion Price in effect on the date of such
surrender.
Section 1603. Cash Adjustment Upon Conversion.
The Company shall not be required to deliver fractions of shares of Common
Stock upon conversions of Convertible Securities. If more than one Convertible
Security shall be surrendered for conversion at one time by the same Holder,
the number of full shares which shall be deliverable upon conversion thereof
shall be computed on the basis of the aggregate principal amount of the
Securities so surrendered. If any fractional interest in a share of Common
Stock would be deliverable upon the conversion of any Convertible Security or
Securities, the Company shall make an adjustment therefor in cash equal to the
current market value of such fractional interest computed to the nearest cent
either on the basis of the last reported sale price regular way of the Common
Stock on the New York Exchange (or, if not listed on the New York Exchange,
then on such other exchange on which the shares of Common Stock are listed as
the Company may designate) on the last Business Day prior to the Date of
Conversion or, if there shall not have been a sale on such last Business Day,
on the basis of the average of the bid and asked quotations therefor on such
exchange on such last Business Day or, if the Common Stock shall not then be
listed on any exchange, at the highest bid quotation in the over-the-counter
market on such last Business Day as reported by the National Association of
Securities Dealers through NASDAQ, its automated system for reporting quotes,
or its successor or such other generally accepted source of publicly reported
bid and asked quotations as the Company may reasonably designate.
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Section 1604. Conversion Price.
The Conversion Price applicable to any series of Convertible Securities
shall be the initial Conversion Price set forth on the Officers' Certificate or
supplemental indenture establishing such series adjusted as provided in this
Article Sixteen.
Section 1605. Adjustment of Conversion Price.
The Conversion Price applicable to any series of Convertible Securities
shall be adjusted from time to time as follows:
(a) In case the Company shall, at any time or from time to time while the
Securities of any series are Outstanding, (i) pay a dividend on its Common
Stock in shares of Common Stock, (ii) subdivide its outstanding shares of
Common Stock into a larger number of shares, or (iii) combine its outstanding
Common Stock into a smaller number of shares, the Conversion Price for such
series in effect immediately prior thereto shall be adjusted so that the Holder
of any Security of such series thereafter surrendered for conversion shall be
entitled to receive the number of shares of Common Stock or other securities of
the Company which he would have owned or have been entitled to receive after
the happening of any of the events described above, had such Convertible
Security of such series been converted immediately prior to the happening of
such event. An adjustment made pursuant to this subdivision (a) shall become
effective, in the case of a dividend, on the payment date retroactively to
immediately after the opening of business on the day following the record date
for the determination of shareholders entitled to receive such dividend,
subject to the provisions of paragraph (g) of this Section 1605, and shall
become effective in the case of a subdivision or combination immediately after
the opening of business on the day following the day when such subdivision or
combination, as the case may be, becomes effective.
(b) In case the Company shall, at any time or from time to time while the
Convertible Securities of any series are Outstanding, issue rights or warrants
to all holders of its shares of Common Stock entitling them (for a period
expiring within 45 days of the record date mentioned below) to subscribe for or
purchase shares of Common Stock at a price per share less than the current
market price per share of Common Stock (as defined in paragraph (d) below) at
such record date, the Conversion Price of any series of Convertible Securities
in effect immediately prior to the issuance of such rights or warrants shall be
adjusted as follows: the number of shares of Common Stock into which $1,000
principal amount of Convertible Securities of such series was theretofore
convertible shall be multiplied by a fraction, of which the numerator shall be
the number of shares of Common Stock outstanding immediately prior to such
record date plus the number of additional shares of Common Stock offered for
subscription or purchase, and of which the denominator shall be the number of
shares of Common
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Stock outstanding immediately prior to such record date plus the number of
shares which the aggregate offering price of the total number of shares so
offered would purchase at such current market price; and the Conversion Price
for such series of Convertible Securities shall be adjusted by dividing $1,000
by the new number of shares into which $1,000 principal amount of Securities of
such series shall be convertible as aforesaid. Such adjustment shall become
effective on the date of such issuance retroactively to immediately after the
opening of business on the day following the record date for the determination
of shareholders entitled to receive such rights or warrants, subject to the
provisions of paragraph (g) of this Section 1605. In determining whether any
rights or warrants entitle the holders to subscribe for or purchase shares of
Common Stock at less than such current market price, and in determining the
aggregate offering price of such shares, there shall be taken into account any
consideration received by the Company for such rights or warrants, the value of
such consideration, if other than cash, to be determined by the Board of
Directors.
(c) In case the Company shall, at any time from time to time while the
Convertible Securities of any series are Outstanding, distribute to all holders
of shares of its Common Stock evidences of its indebtedness or securities or
assets (excluding cash dividends or cash distributions payable out of
consolidated net earnings or retained earnings) or rights or warrants to
subscribe for shares of Common Stock at a price per share less than the current
market price per share of Common Stock, determined in the manner set forth in
paragraph (d) below, but excluding rights or warrants referred to in paragraph
(b) above, the Conversion Price for such series of Convertible Securities in
effect immediately prior to such distribution shall be adjusted by multiplying
the number of shares of Common Stock into which $1,000 principal amount of
Convertible Securities of such series of Convertible Securities was theretofore
convertible by a fraction, of which the numerator shall be the current market
price per share of Common Stock (as defined in paragraph (d) below) on the
record date for such distribution, and of which the denominator shall be such
current market price per share of the Common Stock, less the then fair market
value (as determined by the Board of Directors of the Company, whose
determination shall be conclusive) of the portion of such evidences of
indebtedness, securities or assets or of such subscription rights or warrants
so distributed applicable to one share of Common Stock; and the Conversion
Price for such series of Convertible Securities shall be adjusted by dividing
$1,000 by the new number of shares into which $1,000 principal amount of
Convertible Securities of such series shall be convertible as aforesaid. Such
adjustment shall become effective on the date of such distribution
retroactively to immediately after the opening of business on the day following
the record date for the determination of shareholders entitled to receive such
distribution, subject to the provisions of paragraph (g) of this Section 1605.
For the purposes of this paragraph (c) consolidated net earnings or retained
earnings shall be computed by adding thereto all charges against retained
earnings on account of dividends paid in shares of Common Stock in respect of
which the Conversion Price has
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been adjusted, all as determined by Independent Public Accountants, whose
determination shall be conclusive.
(d) For the purpose of any computation under paragraphs (b) and (c)
above, the current market price per share of Common Stock at any date shall be
deemed to be the average of the market values of the shares of Common Stock for
the ten consecutive Business Days immediately preceding the day in question.
The market value of the Common Stock for each day shall be determined as
provided in Section 1603 hereof.
(e) The Company may make such reductions in the Conversion Price for any
series of Convertible Securities, in addition to those required by paragraphs
(a), (b) and (c) of this Section as it considers to be advisable in order that
any event treated for Federal income tax purposes as a dividend of stock or
stock rights shall not be taxable to the recipients.
(f) Except as herein otherwise provided, no adjustment in the Conversion
Price for any series of Convertible Securities shall be made by reason of the
issuance, in exchange for cash, property or services, of shares of Common Stock
or any securities convertible into or exchangeable for shares of Common Stock
or carrying the right to purchase any of the foregoing.
(g) If the Company shall take a record of the holders of its shares of
Common Stock for the purpose of entitling them to receive any dividend or any
subscription or purchase rights or any distribution and shall, thereafter and
before the distribution to shareholders of any such dividend, subscription or
purchase rights or distribution, legally abandon its plan to pay or deliver
such dividend, subscription or purchase rights or distribution, then no
adjustment of the Conversion Price for any series of Convertible Securities
shall be required by reason of the taking of such record.
(h) No adjustment in the Conversion Price for any series of Convertible
Securities shall be required unless such adjustment would require an increase
or decrease of at least 1% in such price; provided, however, that any
adjustments which by reason of this paragraph (h) are not required to be made
shall be carried forward and taken into account in any subsequent adjustment.
All calculations under this Article Seventeen shall be made to the nearest cent
or to the nearest one-hundredth of a share, as the case may be.
(i) Whenever the Conversion Price for any series of Convertible
Securities is adjusted as herein provided, the Company shall (i) forthwith
place on file at the Principal Office of the Trustee an Officers' Certificate
showing in detail the facts requiring such adjustment and the Conversion Price
after such adjustment and shall exhibit the same from time to time to any
Holder of Convertible Securities of such series desiring an
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inspection thereof, and (ii) cause a notice stating that such adjustment has
been effected and the adjusted Conversion Price to be mailed to the Holders of
Registered Convertible Securities of such series at their last addresses as
they shall appear on the Security Register.
(j) The Company may delete, modify or vary any of the provisions
applicable to conversion of the Convertible Securities of any series, or may
add new provisions applicable thereto, all as may be contained in the Board
Resolutions and Officers' Certificate or supplemental indenture establishing
such series.
Section 1606. Effect of Reclassifications,
Consolidations, Mergers or
Sales on Conversion Privilege.
In case of any reclassification or change of outstanding shares of the
class of Common Stock issuable upon conversion of the Convertible Securities
(other than a change in par value, or from par value to no par value, or from
no par value to par value, or as a result of a subdivision or combination), or
in case of any merger or consolidation of the Company with one or more other
corporations (other than a merger or consolidation in which the Company is the
continuing corporation and which does not result in any reclassification or
change of outstanding shares of Common Stock issuable upon conversion of the
Securities), or in case of the merger of the Company into another corporation,
or in case of any sale or conveyance to another corporation of the property of
the Company as an entirety or substantially as an entirety, the Holders of
Convertible Securities of each series then Outstanding shall have the right to
convert such Convertible Securities into the kind and amount of shares of
capital stock or other securities and property, including cash, receivable upon
such reclassifications change, consolidation, merger, sale or conveyance by a
holder of the number of shares of Common Stock into which such Convertible
Securities might have been converted immediately prior to such
reclassification, change, consolidation, merger, sale or conveyance. In any
such case the Company, or such successor or purchasing corporation, as the
case may be, shall execute with the Trustee one or more supplemental indentures
(which shall conform to the Trust Indenture Act of 1939 as in force at the
date of the execution of such supplemental indenture) containing provisions to
the effect set forth above in this Section 1606 and providing further for
adjustments which shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Article Sixteen; and any such adjustment which
shall be approved by the Board of Directors and set forth in such supplemental
indenture or supplemental indentures shall be conclusive for all purposes of
this Section, and the Trustee shall not be under any responsibility to
determine the correctness of any provision contained in such supplemental
indenture or supplemental indentures relating to either the kind or amount of
shares of stock or securities or property receivable by Holders of Securities
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of any series upon the conversion of their Convertible Securities after any
such reclassification, change, consolidation, merger, sale or conveyance.
The above provisions of this Section 1606 shall similarly apply to
successive reclassifications, changes, consolidations, mergers, sales and
conveyances.
Section 1607. Taxes on Conversions.
The issue of stock certificates on conversions of Convertible Securities
shall be made without charge to the converting Holder of Convertible Securities
for any tax in respect of the issue thereof. The Company shall not, however,
be required to pay any tax which may be payable in respect of any transfer
involved in the issue and delivery of shares in any name other than that of the
Holder of any Registered Convertible Security converted, and the Company shall
not be required to issue or deliver any such stock certificate unless and until
the Person or Persons requesting the issue thereof shall have paid to the
Company the amount of such tax or shall have established to the satisfaction of
the Company that such tax has been paid.
Section 1608. Company to Reserve Common Stock.
The Company shall at all times reserve and keep available out of the
aggregate of its authorized but unissued shares or its issued shares held in
its treasury, or both, for the purpose of effecting the conversion of the
Securities, such number of its duly authorized shares of Common Stock as shall
from time to time be sufficient to effect the conversion of all Outstanding
Securities.
If any shares of Common Stock reserved or to be reserved for the purpose
of conversion of Securities hereunder require registration with or approval of
any governmental authority under any Federal or State law before such shares
may be validly delivered upon conversion, then the Company covenants that it
will in good faith and as expeditiously as possible endeavor to secure
registration or approval, as the case may be.
The Company covenants that all shares of Common Stock which may be delivered
upon conversion of Convertible Securities shall upon delivery be fully paid and
nonassessable by the Company and free from all taxes, liens and charges with
respect to the issue or delivery thereof.
Section 1609. Disclaimer by Trustee of Responsibility for Certain Matters.
Neither the Trustee nor any conversion agent shall at any time be under
any duty or responsibility to any Holder of Convertible Securities of any
series to determine
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whether any facts exist which may require any adjustment of the Conversion
Price for such series, or with respect to the nature or extent of any such
adjustment when made, or with respect to the method employed, or herein or in
any supplemental indenture provided to be employed, in making the same,
subject, however, to the provisions of Sections 315(a) through 315(b) of the
Trust Indenture Act. Neither the Trustee nor any conversion agent shall be
accountable with respect to the validity or value (or the kind or amount) of
any shares of Common Stock, or of any securities or property which may at any
time be issued or delivered upon the conversion of any Convertible Security;
and neither of them makes any representation with respect thereto. Neither the
Trustee nor any conversion agent shall be responsible for any failure of the
Company to make any cash payment or to issue, transfer or deliver any shares of
Common Stock or stock certificates or other securities or property upon the
surrender of any Security for the purpose of conversion or, subject to Sections
315(a) through 315(b) of the Trust Indenture Act, to comply with any of the
covenants of the Company contained in this Article Sixteen.
Section 1610. Company to Give Notice of Certain Events.
In the event
(A) that the Company shall pay any dividend or make any distribution
to the holders of shares of Common Stock otherwise than in cash charged
against consolidated net earnings or retained earnings of the Company and
its consolidated subsidiaries or in Common Stock; or
(B) that the Company shall offer for subscription or purchase, pro
rata, to the holders of shares of Common Stock any additional shares of
stock of any class or any securities convertible into or exchangeable for
stock of any class; or
(C) of any reclassification or change of outstanding shares of the
class of Common Stock issuable upon the conversion of the Securities
(other than a change in par value, or from par value to no par value, or
from no par value to par value, or as a result of a subdivision or
combination), or of any merger or consolidation of the Company with, or
merger of the Company into, another corporation (other than a merger or
consolidation in which the Company is the continuing corporation and which
does not result in reclassification or change of outstanding shares of
Common Stock issuable upon conversion of the Securities), or of any sale
or conveyance to another corporation of the property of the Company as an
entirety or substantially as an entirety;
then, and in any one or more of such events, the Company will give to the
Trustee and each conversion agent written notice thereof at least fifteen days
prior to (i) the record
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date fixed with respect to any of the events specified in (A) and (B) above,
and (ii) the effective date of any of the events specified in (C) above; and
shall mail in the case of Registered Securities, promptly a copy of such notice
to the Holders thereof at their last addresses as they shall appear upon the
Security Register or, in the case of Bearer Securities, cause such notice to be
published in an Authorized Newspaper. Failure to give such notice, or any
defect therein, shall not affect the legality or validity of such dividend,
distribution, reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding up.
ARTICLE SEVENTEEN
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS
Section 1701. Indenture and Securities Solely Corporate Obligations.
No recourse for the payment of the principal of or premium, if any,
or interest or Additional Amounts on any Security, or for any claim based
thereon or otherwise in respect thereof, and no recourse under or upon any
obligation, covenant or agreement of the Company in this Indenture or in any
supplemental indenture or, in any Security, or because of the creation of any
indebtedness represented thereby, shall be had against any incorporator,
stockholder, officer or director, as such, past, present or future, of the
Company or of any successor corporation, either directly or through the Company
or any successor corporation, whether by virtue of any constitution, statute or
rule of law, or by the enforcement of any assessment or penalty or otherwise;
it being expressly understood that all such liability is hereby expressly
waived and released as a condition of, and as a consideration for, the
execution of this Indenture and the issuance of the Securities.
* * * * *
This instrument may be executed in any number of counterparts, each
of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, and their respective corporate seals to be hereunto affixed,
all as of the day and year first above written.
[SEAL] Advanta Corp.
Attest:
______________________________ By_________________________________________
Name:
Title:
[SEAL] _____________________________, as Trustee
Attest:
______________________________ By_________________________________________
Name:
Title:
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STATE OF ____________ )
SS.:
COUNTY OF __________ )
On the _____ day of ________________, 1995, before me personally came
_______________, to me known, who, being by me duly sworn, did depose and say
that he is a _____________ of Advanta Corp., a Delaware corporation, one of the
persons described in and who executed the foregoing instrument; that he knows
the seal of said Corporation; that the seal affixed to said instrument is such
Corporation's seal; that it was so affixed by authority of the Board of
Directors of said Corporation; and that he signed his name thereto by like
authority.
____________________________
Notary Public
[NOTARIAL SEAL]
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STATE OF ____________ )
SS.:
COUNTY OF __________ )
On the _____ day of ________________, 1995, before me personally came
_______________, to me known, who, being by me duly sworn, did depose and say
that he is a _____________ of ____________________________________, a national
banking association organized and existing under the laws of the United States,
one of the persons described in and who executed the foregoing instrument; that
he knows the seal of said Corporation; that the seal affixed to said instrument
is such Corporation's seal; that it was so affixed by authority of the Board of
Directors of said Corporation; and that he signed his name thereto by like
authority.
____________________________
Notary Public
[NOTARIAL SEAL]
97
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Advanta Corp.,
Issuer
to
Trustee
-----------------------------
SUBORDINATED INDENTURE
-----------------------------
Dated as of , 1995
Subordinated Debt Securities
================================================================================
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TABLE OF CONTENTS
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Recitals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 101. Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Additional Amounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Affiliate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Authenticating Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Authorized Newspaper . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Bearer Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Board of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Board Resolution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Business Day . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Commission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Company Request and Company Order . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Consolidated Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Controlled Subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Conversion Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Convertible Security and Convertible Securities . . . . . . . . . . . . . . . . . . . . . . . 4
Corporate Trust Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Coupon . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Currency or Money . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Currency Indexed Note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Date of Conversion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Defaulted Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Dollars or $ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Event of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Government Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Holder . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Independent Public Accountants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Indexed Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
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Interest Payment Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Legal Holiday . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Office or Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Officers' Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Opinion of Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Original Issue Discount Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Paying Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Person . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Place of Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Predecessor Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Redemption Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Redemption Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Registered Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Regular Record Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Responsible Officer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Security or Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Security Register and Security Registrar . . . . . . . . . . . . . . . . . . . . . . . . . 10
Senior Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Significant Subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Special Record Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Stated Maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Trust Indenture Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
United States Alien . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
U.S. Depository or Depository . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Vice President . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Voting Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 102. Compliance Certificates and Opinions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 103. Form of Documents Delivered to Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 104. Acts of Holders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 105. Notices, etc. to Trustee and Company. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 106. Notice to Holders of Securities; Waiver. . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 107. Language of Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 108. Conflict with Trust Indenture Act. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 109. Effect of Headings and Table of Contents. . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 110. Successors and Assigns. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 111. Separability Clause. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 112. Benefits of Indenture. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
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Section 113. Governing Law. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 114. Legal Holidays . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
ARTICLE TWO
SECURITIES FORMS
Section 201. Forms Generally. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 202. Form of Trustee's Certificate of Authentication. . . . . . . . . . . . . . . . . . . . . . . 19
Section 203. Securities in Global Form. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
ARTICLE THREE
THE SECURITIES
Section 301. Amount Unlimited; Issuable in Series. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 302. Currency; Denominations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 303. Execution, Authentication, Delivery and Dating. . . . . . . . . . . . . . . . . . . . . . . . 24
Section 304. Temporary Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 305. Registration, Transfer and Exchange. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 306. Mutilated, Destroyed, Lost and Stolen Securities. . . . . . . . . . . . . . . . . . . . . . . 31
Section 307. Payment of Interest and Certain Additional Amounts; Rights to Interest and
Certain Additional Amounts Preserved . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 308. Persons Deemed Owners. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 309. Cancellation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 310. Computation of Interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
ARTICLE FOUR
SATISFACTION AND DISCHARGE
Section 401. Satisfaction and Discharge of Indenture. . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 402. Satisfaction, Discharge and Defeasance of Securities of any Series. . . . . . . . . . . . . . 38
Section 403. Application of Trust Money. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
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ARTICLE FIVE
REMEDIES
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Section 501. Events of Default. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 502. Acceleration of Maturity; Rescission and Annulment. . . . . . . . . . . . . . . . . . . . . . 43
Section 503. Collection of Indebtedness and Suits for Enforcement by Trustee. . . . . . . . . . . . . . . 45
Section 504. Trustee May File Proofs of Claim. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Section 505. Trustee May Enforce Claims without Possession of Securities or Coupons. . . . . . . . . . . . 47
Section 506. Application of Money Collected. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Section 507. Limitations on Suits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Section 508. Unconditional Right of Holders to Receive Principal and any Premium, Interest
and Additional Amounts and to Convert any Convertible Security . . . . . . . . . . . . . . . 48
Section 509. Restoration of Rights and Remedies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 510. Rights and Remedies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 511. Delay or Omission Not Waiver. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 512. Control by Holders of Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 513. Waiver of Past Defaults. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 514. Waiver of Stay or Extension Laws. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
ARTICLE SIX
THE TRUSTEE
Section 601. Certain Rights of Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Section 602. Not Responsible for Recitals or Issuance of Securities. . . . . . . . . . . . . . . . . . . . 52
Section 603. May Hold Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Section 604. Money Held in Trust. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Section 605. Compensation and Reimbursement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Section 606. Corporate Trustee Required; Eligibility. . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Section 607. Resignation and Removal; Appointment of Successor. . . . . . . . . . . . . . . . . . . . . . 54
Section 608. Acceptance of Appointment by Successor. . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Section 609. Merger, Conversion, Consolidation or Succession to Business. . . . . . . . . . . . . . . . . 57
Section 610. Appointment of Authenticating Agent. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
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ARTICLE SEVEN
HOLDER'S LISTS AND REPORTS BY TRUSTEE AND COMPANY
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Section 701. Company to Furnish Trustee Names and Addresses of Holders. . . . . . . . . . . . . . . . . . 60
Section 702. Preservation of Information; Communications to Holders. . . . . . . . . . . . . . . . . . . . 60
Section 703. Reports by Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Section 704. Reports by Company. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
ARTICLE EIGHT
CONSOLIDATION, MERGER AND SALES
Section 801. Company May Consolidate, Etc., Only on Certain Terms. . . . . . . . . . . . . . . . . . . . . 62
Section 802. Successor Person Substituted for Company. . . . . . . . . . . . . . . . . . . . . . . . . . . 63
ARTICLE NINE
SUPPLEMENTAL INDENTURES
Section 901. Supplemental Indentures without Consent of Holders. . . . . . . . . . . . . . . . . . . . . . 63
Section 902. Supplemental Indentures with Consent of Holders. . . . . . . . . . . . . . . . . . . . . . . 65
Section 903. Execution of Supplemental Indentures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Section 904. Effect of Supplemental Indentures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Section 905. Reference in Securities to Supplemental Indentures. . . . . . . . . . . . . . . . . . . . . . 67
Section 906. Subordination Unimpaired. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
ARTICLE TEN
COVENANTS
Section 1001. Payment of Principal and any Premium, Interest and Additional Amounts. . . . . . . . . . . . 67
Section 1002. Maintenance of Office or Agency. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 1003. Money for Securities Payments to Be Held in Trust. . . . . . . . . . . . . . . . . . . . . . 69
Section 1004. Additional Amounts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Section 1005. Limitation Upon Disposition of Voting Stock of
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Significant Subsidiaries. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
Section 1006. Limitation on Creation of Liens. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
Section 1007. Corporate Existence. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
Section 1008. Waiver of Certain Covenants. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
Section 1009. Company Statement as to Compliance; Notice of Certain Defaults. . . . . . . . . . . . . . . . 74
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
Section 1101. Applicability of Article. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Section 1102. Election to Redeem; Notice to Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Section 1103. Selection by Trustee of Securities to be Redeemed. . . . . . . . . . . . . . . . . . . . . . 75
Section 1104. Notice of Redemption. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Section 1105. Deposit of Redemption Price. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
Section 1106. Securities Payable on Redemption Date. . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
Section 1107. Securities Redeemed in Part. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
Section 1108. Conversion Arrangements on Call for Redemption. . . . . . . . . . . . . . . . . . . . . . . . 79
ARTICLE TWELVE
SINKING FUNDS
Section 1201. Applicability of Article. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
Section 1202. Satisfaction of Sinking Fund Payments with Securities. . . . . . . . . . . . . . . . . . . . 80
Section 1203. Redemption of Securities for Sinking Fund. . . . . . . . . . . . . . . . . . . . . . . . . . 81
ARTICLE THIRTEEN
REPAYMENT AT THE OPTION OF HOLDERS
Section 1301. Applicability of Article. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
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ARTICLE FOURTEEN
SECURITIES IN FOREIGN CURRENCIES
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Section 1401. Applicability of Article. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
ARTICLE FIFTEEN
MEETINGS OF HOLDERS OF SECURITIES
Section 1501. Purposes for Which Meetings May Be Called. . . . . . . . . . . . . . . . . . . . . . . . . . 83
Section 1502. Call, Notice and Place of Meetings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
Section 1503. Persons Entitled to Vote at Meetings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
Section 1504. Quorum; Action. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
Section 1505. Determination of Voting Rights; Conduct and Adjournment of Meetings. . . . . . . . . . . . . 85
Section 1506. Counting Votes and Recording Action of Meetings. . . . . . . . . . . . . . . . . . . . . . . 86
ARTICLE SIXTEEN
SUBORDINATION
Section 1601. Securities Subordinated to Senior Indebtedness . . . . . . . . . . . . . . . . . . . . . . . 87
Section 1602. Subrogation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
Section 1603. Obligation of Company Unconditional. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
Section 1604. Payments on Securities Permitted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
Section 1605. Effectuation of Subordination By Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . 91
Section 1606. Knowledge of Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
Section 1607. Trustee's Relation to Senior Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . 91
Section 1608. Rights of Holders of Senior Indebtedness Not Impaired . . . . . . . . . . . . . . . . . . . . 92
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ARTICLE SEVENTEEN
CONVERSION
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Section 1701. Conversion Privilege . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
Section 1702. Manner of Exercise of Conversion
Privilege . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
Section 1703. Cash Adjustment Upon Conversion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
Section 1704. Conversion Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
Section 1705. Adjustment of Conversion Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
Section 1706. Effect of Reclassifications, Consolidations, Mergers or Sales on Conversion Privilege . . . . 97
Section 1707. Taxes on Conversions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
Section 1708. Company to Reserve Common Stock Privilege . . . . . . . . . . . . . . . . . . . . . . . . . . 98
Section 1709. Disclaimer by Trustee of Responsibility
for Certain Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
Section 1710. Company to Give Notice of Certain
Events . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
</TABLE>
ARTICLE EIGHTEEN
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS
<TABLE>
<S> <C> <C>
Section 1801. Indenture and Securities Solely Corporate Obligations. . . . . . . . . . . . . . . . . . . . 100
</TABLE>
viii
<PAGE> 10
SUBORDINATED INDENTURE, dated as of _______________ (the
"Indenture"), between Advanta Corp., a corporation duly organized and existing
under the laws of the State of Delaware (hereinafter called the "Company"),
having its principal executive office located at 650 Naamans Road, Claymont,
Delaware 19703, and _______________, a national banking association duly
organized and existing under the laws of the United States (hereinafter called
the "Trustee"), having its Corporate Trust Office located at
________________________.
RECITALS
The Company has duly authorized the execution and delivery of
this Indenture to provide for the issuance from time to time of its unsecured
subordinated debentures, notes or other evidences of indebtedness (hereinafter
called the "Securities"), unlimited as to principal amount, to bear such rates
of interest, to mature at such time or times, to be issued in one or more
series and to have such other provisions as shall be fixed as hereinafter
provided.
The Company has duly authorized the execution and delivery of
this Indenture. All things necessary to make this Indenture a valid agreement
of the Company, in accordance with its terms, have been done.
This Indenture is subject to the provisions of the Trust
Indenture Act of 1939, as amended, and the rules and regulations of the
Securities and Exchange Commission promulgated thereunder that are required to
be part of this Indenture and, to the extent applicable, shall be governed by
such provisions.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of
the Securities by the Holders thereof, it is mutually covenanted and agreed,
for the equal and proportionate benefit of all Holders of the Securities and
any Coupons (as hereinafter defined) as follows:
<PAGE> 11
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 101. Definitions.
Except as otherwise expressly provided in or pursuant to this
Indenture or unless the context otherwise requires, for all purposes of this
Indenture:
(1) the terms defined in this Article have the
meanings assigned to them in this Article, and include the plural as
well as the singular;
(2) all other terms used herein which are defined in
the Trust Indenture Act, either directly or by reference therein, have
the meanings assigned to them therein;
(3) all accounting terms not otherwise defined
herein have the meanings assigned to them in accordance with generally
accepted accounting principles and, except as otherwise herein
expressly provided, the term "generally accepted accounting
principles" with respect to any computation required or permitted
hereunder shall mean such accounting principles as are generally
accepted at the date of such computation; and
(4) the words "herein", "hereof", "hereto" and
"hereunder" and other words of similar import refer to this Indenture
as a whole and not to any particular Article, Section or other
subdivision.
Certain terms used principally in certain Articles hereof are
defined in those Articles.
"Act", when used with respect to any Holders, has the meaning
specified in Section 104.
"Additional Amounts" means any additional amounts which are
required hereby or by any Security, under circumstances specified herein or
therein, to be paid by the Company in respect of certain taxes imposed on
Holders specified therein and which are owing to such Holders.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this
definition, "control", when used with
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<PAGE> 12
respect to any specified Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise; and the terms "controlling" and
"controlled" have the meanings correlative to the foregoing.
"Authenticating Agent" means any Person authorized by the
Trustee pursuant to Section 610 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"Authorized Newspaper" means a newspaper, in an official
language of the place of publication or in the English language, customarily
published on each day that is a Business Day in the place of publication,
whether or not published on days that are Legal Holidays in the place of
publication, and of general circulation in each place in connection with which
the term is used or in the financial community of each such place. Where
successive publications are required to be made in Authorized Newspapers, the
successive publications may be made in the same or in different newspapers in
the same city meeting the foregoing requirements and in each case on any day
that is a Business Day in the place of publication.
"Bearer Security" means any Security in the form established
pursuant to Section 201 which is payable to bearer.
"Board of Directors" means the board of directors of the
Company or any committee of that board duly authorized to act generally or in
any particular respect for the Company hereunder.
"Board Resolution" means a copy of one or more resolutions,
certified by the Secretary or an Assistant Secretary of the Company to have
been duly adopted by the Board of Directors and to be in full force and effect
on the date of such certification, delivered to the Trustee.
"Business Day", with respect to any Place of Payment or other
location, means each Monday, Tuesday, Wednesday, Thursday and Friday that is
not a Legal Holiday in such Place of Payment or other location.
"Commission" means the Securities and Exchange Commission, as
from time to time constituted, created under the Securities Exchange Act of
1934 or, if at any time after the execution of this Indenture such Commission
is not existing and performing the duties now assigned to it under the Trust
Indenture Act, then the body performing such duties at such time.
"Common Stock" means all shares now or hereafter authorized of
any class
3
<PAGE> 13
of common stock of the Company presently authorized and stock of any other
class into which such shares may hereafter have been changed.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person, and any other obligor upon the
Securities.
"Company Request" and "Company Order" mean, respectively, a
written request or order, as the case may be, signed in the name of the Company
by the Chairman of the Board of Directors, a Vice Chairman, the President or a
Vice President, and by the Treasurer, an Assistant Treasurer, the Secretary or
an Assistant Secretary, of the Company, and delivered to the Trustee.
"Consolidated Assets" means all assets owned directly by the
Company or indirectly by the Company through any Subsidiary and reflected on
the Company's consolidated balance sheet prepared in accordance with generally
accepted accounting principles.
"Controlled Subsidiary" means each Significant Subsidiary if
at least 80% of the outstanding shares of its Voting Stock is at the time owned
by the Company or by one or more Controlled Subsidiaries of the Company or by
the Company and one or more Controlled Subsidiaries.
"Conversion Price" means the price per share of Common Stock
from time to time in effect at which any Convertible Security may be converted
into Common Stock as determined by or pursuant to the terms of this Indenture.
"Convertible Security" or "Convertible Securities" means any
Security or Securities, as the case may be, which are by their terms
convertible into Common Stock.
"Corporate Trust Office" means the principal office of the
Trustee at which at any particular time its corporate trust business shall be
administered, which office at the date of original execution of this Indenture
is located at the address specified in the first paragraph of this instrument.
"Corporation" includes corporations and, except for purposes
of Article Eight, associations, companies and business trusts.
"Coupon" means any interest coupon appertaining to a Bearer
Security.
"Currency" or "Money", with respect to any payment, deposit or
other
4
<PAGE> 14
transfer in respect of the principal of or any premium or interest on or any
Additional Amounts with respect to any Security, means the unit or units of
legal tender for the payment of public and private debts (or any composite
thereof) in which such payment, deposit or other transfer is required to be
made by or pursuant to the terms hereof and, with respect to any other payment,
deposit or transfer pursuant to or contemplated by the terms hereof, means
Dollars.
"Currency Indexed Note" means any Security with the amount of
principal payments determined by reference to an index Currency.
"Date of Conversion" with respect to any Convertible Security
or portion thereof to be converted, means the date on which such Convertible
Security shall be surrendered for conversion and notice given in accordance
with the provisions of Article Seventeen.
"Defaulted Interest" has the meaning specified in Section 307.
"Dollars" or "$" means a dollar or other equivalent unit of
legal tender for payment of public or private debts in the United States of
America.
"Event of Default" has the meaning specified in Section 501.
"Government Obligations", with respect to any Security, means
(i) direct obligations of the government or governments which issued the
Currency in which the principal of or any premium or interest on such Security
or any Additional Amounts in respect thereof shall be payable, in each case
where the payment or payments thereunder are supported by the full faith and
credit of such government or governments or (ii) obligations of a Person
controlled or supervised by and acting as an agency or instrumentality of such
government or governments, in each case where the payment or payments
thereunder are unconditionally guaranteed as a full faith and credit obligation
by such government or governments, and which, in the case of (i) or (ii), are
not callable or redeemable at the option of the issuer or issuers thereof, and
shall also include a depository receipt issued by a bank or trust company as
custodian with respect to any such Government Obligation or a specific payment
of interest on or principal of or other amount with respect to any such
Government Obligation held by such custodian for the account of the holder of a
depository receipt, provided that (except as required by law) such custodian is
not authorized to make any deduction from the amount payable to the holder of
such depository receipt from any amount received by the custodian in respect of
the Government Obligation or the specific payment of interest on or principal
of or other amount with respect to the Government Obligation evidenced by such
depository receipt.
5
<PAGE> 15
"Holder", in the case of any Registered Security, means the
Person in whose name such Security is registered in the Security Register and,
in the case of any Bearer Security, means the bearer thereof and, in the case
of any Coupon, means the bearer thereof.
"Indenture" means this instrument as it may from time to time
be supplemented or amended by one or more indentures supplemental hereto
entered into pursuant to the applicable provisions hereof and, with respect to
any Security, by the terms and provisions of such Security and any Coupon
appertaining thereto established pursuant to Section 301 (as such terms and
provisions may be amended pursuant to the applicable provisions hereof).
"Independent Public Accountants" means accountants or a firm
of accountants that, with respect to the Company and any other obligor under
the Securities or the Coupons, are independent public accountants within the
meaning of the Securities Act of 1933, as amended, and the rules and
regulations promulgated by the Commission thereunder, who may be the
independent public accountants regularly retained by the Company or who may be
other independent public accountants. Such accountants or firm shall be
entitled to rely upon any Opinion of Counsel as to the interpretation of any
legal matters relating to the Indenture or certificates required to be provided
hereunder.
"Indexed Security" means a Security the terms of which provide
that the principal amount thereof payable at Stated Maturity and/or interest to
be paid thereon may be determined by reference to the exchange rate of one or
more specified currencies relative to an index or one or more equity or other
indices and/or formulae or the price of one or more specified commodities or by
such other methods or formulae as may be determined in accordance with this
Indenture.
"Interest", with respect to any Original Issue Discount
Security which by its terms bears interest only after Maturity, means interest
payable after Maturity, and, when used with respect to a Security which
provides for payment of Additional Amounts pursuant to Section 1004, includes
such Additional Amounts.
"Interest Payment Date", with respect to any Security, means
the Stated Maturity of an installment of interest on such Security.
"Legal Holiday", with respect to any Place of Payment or other
location, means a Saturday, a Sunday or a day on which banking institutions or
trust companies in such Place of Payment or other location are not authorized
or obligated to be open.
"Maturity", with respect to any Security, means the date on
which the
6
<PAGE> 16
principal of such Security or an installment of principal becomes due and
payable as provided in or pursuant to this Indenture, whether at the Stated
Maturity or by declaration of acceleration, notice of redemption, notice of
option to elect repayment or otherwise, and includes Redemption Date.
"Office or Agency", with respect to any Securities, means an
office or agency of the Company maintained or designated in a Place of Payment
for such Securities pursuant to Section 1002 or any other office or agency of
the Company maintained or designated for such Securities pursuant to Section
1002 or, to the extent designated or required by Section 1002 in lieu of such
office or agency, the Corporate Trust Office of the Trustee.
"Officers' Certificate" means a certificate signed by the
Chairman of the Board, a Vice Chairman, the President or a Vice President, and
by the Treasurer, an Assistant Treasurer, the Secretary or an Assistant
Secretary of the Company, that complies with the requirements of Section 314(e)
of the Trust Indenture Act and is delivered to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who
may be an employee of or counsel for the Company or other counsel who shall be
reasonably acceptable to the Trustee, that complies with the requirements of
Section 314(e) of the Trust Indenture Act.
"Original Issue Discount Security" means a Security issued
pursuant to this Indenture which provides for declaration of an amount less
than the principal face amount thereof to be due and payable upon acceleration
pursuant to Section 502.
"Outstanding", when used with respect to any Securities,
means, as of the date of determination, all such Securities theretofore
authenticated and delivered under this Indenture, except:
(i) any such Security theretofore cancelled by the Trustee or the
Security Registrar or delivered to the Trustee or the Security
Registrar for cancellation;
(ii) any such Security or portions thereof for whose payment at the
Maturity thereof money in the necessary amount has been
theretofore deposited pursuant hereto with the Trustee or any
Paying Agent (other than the Company) in trust or set aside
and segregated in trust by the Company (if the Company shall
act as its own Paying Agent) for the Holders of such
Securities and any Coupons appertaining thereto, provided
that, if such Securities are to be redeemed, notice of such
redemption has been duly
7
<PAGE> 17
given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made;
(iii) any such Security with respect to which the Company has
effected defeasance pursuant to Section 402 hereof;
(iv) any such Security which has been paid pursuant to Section 306
or in exchange for or in lieu of which other Securities have
been authenticated and delivered pursuant to this Indenture,
unless there shall have been presented to the Trustee proof
satisfactory to it that such Security is held by a bona fide
purchaser in whose hands such Security is a valid obligation
of the Company; and
(v) Convertible Securities converted into Common Stock in
accordance with Article Seventeen hereof;
provided, however, that in determining whether the Holders of the requisite
principal amount of Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder or are present at
a meeting of Holders of Securities for quorum purposes, (i) the principal
amount of an Original Issue Discount Security that may be counted in making
such determination and that shall be deemed to be Outstanding for such purposes
shall be equal to the amount of the principal thereof that pursuant to the
terms of such Original Issue Discount Security would be declared (or shall have
been declared to be) due and payable upon a declaration of acceleration thereof
pursuant to Section 502 at the time of such determination, and (ii) the
principal amount of any Indexed Security that may be counted in making such
determination and that shall be deemed outstanding for such purpose shall be
equal to the principal face amount of such Indexed Security at original
issuance, unless otherwise provided in or pursuant to this Indenture, and (iii)
Securities owned by the Company or any other obligor upon the Securities or any
Affiliate of the Company or such other obligor, shall be disregarded and deemed
not to be Outstanding, except that, in determining whether the Trustee shall be
protected in making any such determination or relying upon any such request,
demand, authorization, direction, notice, consent or waiver, only Securities
which a Responsible Officer of the Trustee actually knows to be so owned shall
be so disregarded. Securities so owned which shall have been pledged in good
faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Trustee (A) the pledgee's right so to act with respect to
such Securities and (B) that the pledgee is not the Company or any other
obligor upon the Securities or any Coupons appertaining thereto or any
Affiliate of the Company or such other obligor.
8
<PAGE> 18
"Paying Agent" means any Person authorized by the Company to
pay the principal of, or any premium or interest on, or any Additional Amounts
with respect to any Security or any Coupon on behalf of the Company.
"Person" means any individual, Corporation, partnership, joint
venture, joint-stock company, trust, unincorporated organization or government
or any agency or political subdivision thereof.
"Place of Payment", with respect to any Security, means the
place or places where the principal of, or any premium or interest on, or any
Additional Amounts with respect to such Security is payable as provided in or
pursuant to this Indenture.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that
evidenced by such particular Security; and, for the purposes of this
definition, any Security authenticated and delivered under Section 306 in
exchange for or in lieu of a lost, destroyed, mutilated or stolen Security or
any Security to which a mutilated, destroyed, lost or stolen Coupon appertains
shall be deemed to evidence the same debt as the lost, destroyed, mutilated or
stolen Security or the Security to which a mutilated, destroyed, lost or stolen
Coupon appertains.
"Redemption Date", with respect to any Security or portion
thereof to be redeemed, means the date fixed for such redemption by or pursuant
to this Indenture.
"Redemption Price", with respect to any Security or portion
thereof to be redeemed, means the price at which it is to be redeemed as
determined by or pursuant to this Indenture.
"Registered Security" means any Security established pursuant
to Section 201 which is registered in the Security Register.
"Regular Record Date" for the interest payable on any
Registered Security on any Interest Payment Date therefor means the date, if
any, specified in or pursuant to this Indenture as the "Regular Record Date".
"Responsible Officer" means an officer of the Trustee assigned
to the Corporate Trust Office, including any Vice President, any trust officer
or any other officer performing functions similar to those performed by the
persons who at the time shall be such officers, and any other officer of the
Trustee to whom a matter is referred because of his knowledge of and
familiarity with the particular subject.
"Security" or "Securities" means any Security or Securities,
as the case may
9
<PAGE> 19
be, authenticated and delivered under this Indenture; provided, however, that,
if at any time there is more than one Person acting as Trustee under this
Indenture, "Securities", with respect to any such Person, shall mean Securities
authenticated and delivered under this Indenture, exclusive, however, of
Securities of any series as to which such Person is not Trustee.
"Security Register" and "Security Registrar" have the
respective meanings specified in Section 305.
"Senior Indebtedness" means the principal of and premium if
any, and interest on the following, whether outstanding at the date hereof or
thereafter incurred or created:
(a) indebtedness of the Company for money borrowed
(including any indebtedness secured by a mortgage or other lien which
is (i) given to secure all or part of the purchase price of property
subject thereto, whether given to the vendor of such property or to
another or (ii) existing on property at the time of acquisition
thereof) evidenced by notes or other written obligations, except such
indebtedness as is by its terms expressly stated to be not superior in
right of payment to the Securities or to rank pari passu or is
identified in a Board Resolution or any indenture supplemental hereto
as not superior in right of payment or to rank pari passu with the
Securities;
(b) indebtedness of the Company evidenced by notes,
debentures, bonds or other securities sold by the Company for money;
(c) indebtedness of others of the kinds described in
either of the preceding clauses (a) or (b) assumed by or guaranteed in
any manner by the Company or in effect guaranteed by the Company
through an agreement to purchase, contingent or otherwise; and
(d) renewals, extensions or refundings of indebtedness of
the kinds described in any of the preceding clauses (a), (b) and (c)
unless, in the case of any particular indebtedness, renewal, extension or
refunding, the instrument creating or evidencing the same or the assumption or
guarantee of the same expressly provides that such indebtedness, renewal,
extension or refunding is not superior in right of payment to the Securities.
"Significant Subsidiary" means any Subsidiary of the Company
the Consolidated Assets of which constitute 20% or more of the Company's
Consolidated Assets.
10
<PAGE> 20
"Special Record Date" for the payment of any Defaulted
Interest on any Registered Security means a date fixed by the Trustee pursuant
to Section 307.
"Stated Maturity", with respect to any Security or any
installment of principal thereof or interest thereon or any Additional Amounts
with respect thereto, means the date established by or pursuant to this
Indenture as the fixed date on which the principal of such Security or such
installment of principal or interest is or such Additional Amounts are due and
payable.
"Subsidiary" means any Corporation of which at the time of
determination the Company or one or more Subsidiaries owns or controls directly
or indirectly more than 50% of the shares of Voting Stock.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended, and any reference herein to the Trust Indenture Act or a particular
provision thereof shall mean such Act or provision, as the case may be, as
amended or replaced from time to time or as supplemented from time to time by
rules or regulations adopted by the Commission under or in furtherance of the
purposes of such Act or provision, as the case may be.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
with respect to one or more series of Securities pursuant to the applicable
provisions of this Indenture, and thereafter "Trustee" shall mean each Person
who is then a Trustee hereunder; provided, however, that if at any time there
is more than one such Person, "Trustee" shall mean each such Person and as used
with respect to the Securities of any series shall mean the Trustee with
respect to the Securities of such series.
"United States", except as otherwise provided herein or in any
Security, means the United States of America (including the states thereof and
the District of Columbia), its territories and possessions and other areas
subject to its jurisdiction.
"United States Alien", except as otherwise provided in or
pursuant to this Indenture, means any Person who, for United States Federal
income tax purposes, is a foreign corporation, a non-resident alien individual,
a non-resident alien fiduciary of a foreign estate or trust, or a foreign
partnership one or more of the members of which is, for United States Federal
income tax purposes, a foreign corporation, a non-resident alien individual or
a non-resident alien fiduciary of a foreign estate or trust.
"U.S. Depository" or "Depository" means, with respect to any
Security issuable or issued in the form of one or more global Securities, the
Person designated as U.S. Depository or Depository by the Company in or
pursuant to this Indenture, which
11
<PAGE> 21
Person must be, to the extent required by applicable law or regulation, a
clearing agency registered under the Securities Exchange Act of 1934, as
amended, and, if so provided with respect to any Security, any successor to
such Person. If at any time there is more than one such Person, "U.S.
Depository" or "Depository" shall mean, with respect to any Securities, the
qualifying entity which has been appointed with respect to such Securities.
"Vice President", when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "Vice President".
"Voting Stock" means stock of a Corporation of the class or
classes having general voting power under ordinary circumstances to elect at
least a majority of the board of directors, managers or trustees of such
Corporation provided that, for the purposes hereof, stock which carries only
the right to vote conditionally on the happening of an event shall not be
considered voting stock whether or not such event shall have happened.
Section 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee
to take any action under any provision of this Indenture, the Company shall
furnish to the Trustee an Officers' Certificate stating that all conditions
precedent, if any, provided for in this Indenture relating to the proposed
action have been complied with and an Opinion of Counsel stating that, in the
opinion of such counsel, all such conditions precedent, if any, have been
complied with, except that in the case of any such application or request as to
which the furnishing of such documents or any of them is specifically required
by any provision of this Indenture relating to such particular application or
request, no additional certificate or opinion need be furnished.
Section 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or opinion
of, or representations
12
<PAGE> 22
by, counsel, unless such officer knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
the matters upon which his certificate or opinion is based are erroneous. Any
such certificate or Opinion of Counsel may be based, insofar as it relates to
factual matters, upon a certificate or opinion of, or representations by, an
officer or officers of the Company stating that the information with respect to
such factual matters is in the possession of the Company unless such counsel
knows, or in the exercise of reasonable care should know, that the certificate
or opinion or representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture or any Security, they may, but need not,
be consolidated and form one instrument.
Section 104. Acts of Holders.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by or pursuant to this Indenture to be
given or taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person or
by an agent duly appointed in writing. If, but only if, Securities of a series
are issuable as Bearer Securities, any request, demand, authorization,
direction, notice, consent, waiver or other action provided in or pursuant to
this Indenture to be given or taken by Holders of Securities of such series
may, alternatively, be embodied in and evidenced by the record of Holders of
Securities of such series voting in favor thereof, either in person or by
proxies duly appointed in writing, at any meeting of Holders of Securities of
such series duly called and held in accordance with the provisions of Article
Fifteen, or a combination of such instruments and any such record. Except as
herein otherwise expressly provided, such action shall become effective when
such instrument or instruments or record or both are delivered to the Trustee
and, where it is hereby expressly required, to the Company. Such instrument or
instruments and any such record (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments or so voting at any such meeting. Proof of
execution of any such instrument or of a writing appointing any such agent, or
of the holding by any Person of a Security, shall be sufficient for any purpose
of this Indenture and (subject to Section 315 of the Trust Indenture Act)
conclusive in favor of the Trustee and the Company and any agent of the Trustee
or the Company, if made in the manner provided in this Section. The record of
any meeting of Holders of Securities shall be proved in the manner provided in
Section 1506.
Without limiting the generality of this Section 104, unless
otherwise provided in or pursuant to this Indenture, a Holder, including a U.S.
Depository that is
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<PAGE> 23
a Holder of a global Security, may make, give or take, by a proxy, or proxies,
duly appointed in writing, any request, demand, authorization, direction,
notice, consent, waiver or other action provided in or pursuant to this
Indenture to be made, given or taken by Holders, and a U.S. Depository that is
a Holder of a global Security may provide its proxy or proxies to the
beneficial owners of interests in any such global Security through such U.S.
Depository's standing instructions and customary practices.
The Trustee shall fix a record date for the purpose of
determining the Persons who are beneficial owners of interest in any permanent
global Security held by a U.S. Depository entitled under the procedures of such
U.S. Depository to make, give or take, by a proxy or proxies duly appointed in
writing, any request, demand, authorization, direction, notice, consent, waiver
or other action provided in or pursuant to this Indenture to be made, given or
taken by Holders. If such a record date is fixed, the Holders on such record
date or their duly appointed proxy or proxies, and only such Persons, shall be
entitled to make, give or take such request, demand, authorization, direction,
notice, consent, waiver or other action, whether or not such Holders remain
Holders after such record date. No such request, demand, authorization,
direction, notice, consent, waiver or other action shall be valid or effective
if made, given or taken more than 90 days after such record date.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved in any reasonable manner which the
Trustee deems sufficient and in accordance with such reasonable rules as the
Trustee may determine; and the Trustee may in any instance require further
proof with respect to any of the matters referred to in this Section 104.
(c) The ownership, principal amount and serial numbers of
Registered Securities held by any Person, and the date of the commencement and
the date of the termination of holding the same, shall be proved by the
Security Register.
(d) The ownership, principal amount and serial numbers of
Bearer Securities held by any Person, and the date of the commencement and the
date of the termination of holding the same, may be proved by the production of
such Bearer Securities or by a certificate executed, as depositary, by any
trust company, bank, banker or other depositary reasonably acceptable to the
Company, wherever situated, if such certificate shall be deemed by the Company
and the Trustee to be satisfactory, showing that at the date therein mentioned
such Person had on deposit with such depositary, or exhibited to it, the Bearer
Securities therein described; or such facts may be proved by the certificate or
affidavit of the Person holding such Bearer Securities, if such certificate or
affidavit is deemed by the Trustee to be satisfactory. The Trustee and the
Company may assume that such ownership of any Bearer Security continues until
(1) another certificate or affidavit bearing a later date issued in respect of
the same
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Bearer Security is produced, or (2) such Bearer Security is produced to the
Trustee by some other Person, or (3) such Bearer Security is surrendered in
exchange for a Registered Security, or (4) such Bearer Security is no longer
Outstanding. The ownership, principal amount and serial numbers of Bearer
Securities held by the Person so executing such instrument or writing and the
date of the commencement and the date of the termination of holding the same
may also be proved in any other manner which the Company and the Trustee deems
sufficient.
(e) If the Company shall solicit from the Holders of any
Registered Securities any request, demand, authorization, direction, notice,
consent, waiver or other Act, the Company may at its option (but is not
obligated to), by Board Resolutions, fix in advance a record date for the
determination of Holders of Registered Securities entitled to give such
request, demand, authorization, direction, notice, consent, waiver or other
Act. If such a record date is fixed, such request, demand, authorization,
direction, notice, consent, waiver or other Act may be given before or after
such record date, but only the Holders of Registered Securities of record at
the close of business on such record date shall be deemed to be Holders for the
purpose of determining whether Holders of the requisite proportion of
Outstanding Securities have authorized or agreed or consented to such request,
demand, authorization, direction, notice, consent, waiver or other Act, and for
that purpose the Outstanding Securities shall be computed as of such record
date; provided that no such authorization, agreement or consent by the Holders
of Registered Securities shall be deemed effective unless it shall become
effective pursuant to the provisions of this Indenture not later than six
months after the record date.
(f) Any request, demand, authorization, direction, notice,
consent, waiver or other action by the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Security issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done or suffered to be done by the Trustee, any Security
Registrar, any Paying Agent or the Company in reliance thereon, whether or not
notation of such action is made upon such Security.
Section 105. Notices, etc. to Trustee and Company.
Any request, demand, authorization, direction, notice,
consent, waiver or Act of Holders or other document provided or permitted by
this Indenture to be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or the Company shall
be sufficient for every purpose hereunder if made, given, furnished
or filed in writing to or with the Trustee at its Corporate Trust
Office, or
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(2) the Company by the Trustee or any Holder shall
be sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage
prepaid, to the Company addressed to the attention of its Treasurer at
the address of its principal office specified in the first paragraph
of this instrument (with a copy to Five Horsham Business Center, 300
Welsh Road, Horsham, Pennsylvania 19004, Attention: Secretary) or at
any other address previously furnished in writing to the Trustee by
the Company.
Section 106. Notice to Holders of Securities; Waiver.
Except as otherwise expressly provided in or pursuant to this
Indenture, where this Indenture provides for notice to Holders of Securities
of any event,
(1) such notice shall be sufficiently given to
Holders of Registered Securities if in writing and mailed,
first-class postage prepaid, to each Holder of a Registered
Security affected by such event, at his address as it appears
in the Security Register, not later than the latest date, and
not earlier than the earliest date, prescribed for the giving
of such Notice; and
(2) such notice shall be sufficiently given to
Holders of Bearer Securities, if any, if published in an
Authorized Newspaper in The City of New York and, if such
Securities are then listed on any stock exchange outside the
United States, in an Authorized Newspaper in such city as the
Company shall advise the Trustee that such stock exchange so
requires, on a Business Day at least twice, the first such
publication to be not earlier than the earliest date and not
later than the latest date prescribed for the giving of such
notice.
In any case where notice to Holders of Registered Securities
is given by mail, neither the failure to mail such notice, nor any defect in
any notice so mailed, to any particular Holder of a Registered Security shall
affect the sufficiency of such notice with respect to other Holders of
Registered Securities or the sufficiency of any notice to Holders of Bearer
Securities given as provided herein. Any notice which is mailed in the manner
herein provided shall be conclusively presumed to have been duly given or
provided. In the case by reason of the suspension of regular mail service or
by reason of any other cause it shall be impracticable to give such notice by
mail, then such notification as shall be made with the approval of the Trustee
shall constitute a sufficient notification for every purpose hereunder.
In case by reason of the suspension of publication of any
Authorized Newspaper or Authorized Newspapers or by reason of any other cause
it shall be impracticable to publish any notice to Holders of Bearer Securities
as provided above,
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then such notification to Holders of Bearer Securities as shall be given with
the approval of the Trustee shall constitute sufficient notice to such Holders
for every purpose hereunder. Neither failure to give notice by publication to
Holders of Bearer Securities as provided above, nor any defect in any notice so
published, shall affect the sufficiency of any notice mailed to Holders of
Registered Securities as provided above.
Where this Indenture provides for notice in any manner, such
notice may be waived in writing by the Person entitled to receive such notice,
either before or after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Holders of Securities shall be filed with
the Trustee, but such filing shall not be a condition precedent to the validity
of any action taken in reliance upon such waiver.
Section 107. Language of Notices.
Any request, demand, authorization, direction, notice,
consent, election or waiver required or permitted under this Indenture shall be
in the English language, except that, if the Company so elects, any published
notice may be in an official language of the country of publication.
Section 108. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with
any duties under any required provision of the Trust Indenture Act imposed
hereon by Section 318(c) thereof, such required provision shall control.
Section 109. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the construction hereof.
Section 110. Successors and Assigns.
All covenants and agreements in this Indenture by the Company
shall bind its successors and assigns, whether so expressed or not.
Section 111. Separability Clause.
In case any provision in this Indenture, any Security or any
Coupon shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
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Section 112. Benefits of Indenture.
Nothing in this Indenture, any Security or any Coupon, express
or implied, shall give to any Person, other than the parties hereto, any
Security Registrar, any Paying Agent and their successors hereunder and the
Holders of Securities or Coupons, any benefit or any legal or equitable right,
remedy or claim under this Indenture.
Section 113. Governing Law.
This Indenture, the Securities and any Coupons shall be
governed by and construed in accordance with the laws of the State of New York
applicable to agreements made or instruments entered into and, in each case,
performed in said state.
Section 114. Legal Holidays
In any case where any Interest Payment Date, Stated Maturity
or Maturity of any Security, or the last date on which a Holder has the right
to convert his Securities shall be a Legal Holiday at any Place of Payment,
then (notwithstanding any other provision of this Indenture, any Security or
any Coupon other than a provision in any Security or Coupon that specifically
states that such provision shall apply in lieu of this Section 114) payment or
conversion of the Securities need not be made at such Place of Payment on such
date, but may be made on the next succeeding day that is a Business Day at such
Place of Payment with the same force and effect as if made on the Interest
Payment Date or at the Stated Maturity or Maturity, or on the last such date
for conversion, and no interest shall accrue on the amount payable on such date
or at such time for the period from and after such Interest Payment Date or
Stated Maturity or Maturity, or last such date for conversion, as the case may
be.
ARTICLE TWO
SECURITIES FORMS
Section 201. Forms Generally.
Each Registered Security, Bearer Security, Coupon and
temporary global Security issued pursuant to this Indenture shall be in the
form established by or pursuant to a Board Resolution or in one or more
indentures supplemental hereto, shall have such appropriate insertions,
omissions, substitutions and other variations as are required or permitted by
or pursuant to this Indenture or any indenture supplemental hereto and may have
such letters, numbers or other marks of identification and such legends or
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endorsements placed thereon as may, consistently herewith, be determined by the
officers executing such Security or Coupon as evidenced by their execution of
such Security or Coupon.
Unless otherwise provided in or pursuant to this Indenture,
the Securities shall be issuable in registered form without Coupons.
Definitive Securities and definitive Coupons shall be printed,
lithographed or engraved or produced by any combination of these methods on a
steel engraved border or steel engraved borders or may be produced in any other
manner, all as determined by the officers of the Company executing such
Securities or Coupons, as evidenced by their execution of such Securities or
Coupons.
Section 202. Form of Trustee's Certificate of
Authentication.
Subject to Section 610, the Trustee's certificate of
authentication shall be in substantially the following form:
This is one of the Securities of the series designated
herein referred to in the within-mentioned Indenture.
, as Trustee
-----------------
By
-----------------------------
Authorized Officer
Section 203. Securities in Global Form.
If Securities of a series shall be issuable in global form,
any such Security may provide that it or any number of such Securities shall
represent the aggregate amount of all Outstanding Securities of such series (or
such lesser amount as is permitted by the terms thereof) from time to time
endorsed thereon and may also provide that the aggregate amount of Outstanding
Securities represented thereby may from time to time be increased or reduced to
reflect exchanges. Any endorsement of any Security in global form to reflect
the amount, or any increase or decrease in the amount, or changes in the rights
of Holders, of Outstanding Securities represented thereby shall be made in such
manner and by such Person or Persons as shall be specified therein or in the
Company Order to be delivered pursuant to Section 303 or 304 with respect
thereto. Subject to the provisions of Section 303 and, if applicable,
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Section 304, the Trustee shall deliver and redeliver any Security in permanent
global form in the manner and upon instructions given by the Person or Persons
specified therein or in the applicable Company Order. If a Company Order
pursuant to Section 303 or 304 has been, or simultaneously is, delivered, any
instructions by the Company with respect to a Security in global form shall be
in writing but need not be accompanied by or contained in an Officers'
Certificate and need not be accompanied by an Opinion of Counsel.
ARTICLE THREE
THE SECURITIES
Section 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited. The Securities
may be issued in one or more series. The Securities shall be subordinated in
right of payment to Senior Indebtedness as provided in Article Sixteen.
With respect to any Securities to be authenticated and
delivered hereunder, there shall be established in or pursuant to a Board
Resolution and set forth in an Officers' Certificate, or established in one or
more indentures supplemental hereto,
(1) the title of such Securities and the series in
which such Securities shall be included;
(2) any limit upon the aggregate principal amount of
the Securities of such title or the Securities of such series which
may be authenticated and delivered under this Indenture (except for
Securities authenticated and delivered upon registration or transfer
of, or in exchange for, or in lieu of, other Securities of such series
pursuant to Section 304, 305, 306, 905, 1107 or 1702 or the terms of
such Securities);
(3) whether such Securities are to be issuable as
Registered Securities, as Bearer Securities or alternatively as Bearer
Securities and Registered Securities, and whether the Bearer
Securities are to be issuable with Coupons, without Coupons or both,
and any restrictions applicable to the offer, sale, delivery or
conversion of the Bearer Securities and the terms, if any, upon which
Bearer Securities may be exchanged for Registered Securities and vice
versa;
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(4) if any of such Securities are to be issuable in
global form, when any of such Securities are to be issuable in global
form and (i) whether beneficial owners of interests in any such global
Security may exchange such interest for Securities of the same series
and of like tenor and of any authorized form and denomination, and the
circumstances under which any such exchanges may occur, if other than
in the manner specified in Section 305, and (ii) the name of the
Depository or the U.S. Depository, as the case may be, with respect to
any global Security;
(5) if any of such Securities are to be issuable as
Bearer Securities or in global form, the date as of which any such
Bearer Security or global Security shall be dated (if other than the
date of original issuance of the first of such Securities to be
issued);
(6) if any of such Securities are to be issuable as
Bearer Securities, whether interest in respect of any portion of a
temporary Bearer Security in global form payable in respect of an
Interest Payment Date therefor prior to the exchange, if any, of such
temporary Bearer Security for definitive Securities shall be paid to
any clearing organization with respect to the portion of such
temporary Bearer Security held for its account and, in such event, the
terms and conditions (including any certification requirements) upon
which any such interest payment received by a clearing organization
will be credited to the Persons entitled to interest payable on such
Interest Payment Date;
(7) the date or dates, or the method or methods, if
any, by which such date or dates shall be determined, on which the
principal of such Securities is payable;
(8) the rate or rates at which such Securities shall
bear interest, if any, or the method or methods, if any, by which such
rate or rates are to be determined, the date or dates, if any, from
which such interest shall accrue or the method or methods, if any, by
which such date or dates are to be determined, the Interest Payment
Dates, if any, on which such interest shall be payable and the Regular
Record Date, if any, for the interest payable on Registered Securities
on any Interest Payment Date, whether and under what circumstances
Additional Amounts on such Securities or any of them shall be payable,
and the basis upon which interest shall be calculated if other than
that of a 360-day year of twelve 30-day months;
(9) if in addition to or other than The City of New
York, the place or places where the principal of, any premium and
interest on or any Additional Amounts with respect to such Securities
shall be payable, any of such Securities
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that are Registered Securities may be surrendered for registration of
transfer, any of such Securities may be surrendered for exchange or
conversion and notices or demands to or upon the Company in respect of
such Securities and this Indenture may be served;
(10) whether any of such Securities are to be
redeemable at the option of the Company and, if so, the period or
periods within which, the price or prices at which and the other terms
and conditions upon which such Securities may be redeemed, in whole or
in part, at the option of the Company;
(11) whether the Company is obligated to redeem or
purchase any of such Securities pursuant to any sinking fund or at the
option of any Holder thereof and, if so, the period or periods within
which, the price or prices at which and the other terms and conditions
upon which such Securities shall be redeemed or purchased, in whole or
in part, pursuant to such obligation, and any provisions for the
remarketing of such Securities so redeemed or purchased;
(12) the denominations in which any of such
Securities that are Registered Securities shall be issuable if other
than denominations of $1,000 and any integral multiple thereof, and
the denominations in which any of such Securities that are Bearer
Securities shall be issuable if other than the denomination of $5,000;
(13) if other than the principal amount thereof, the
portion of the principal amount of any of such Securities that shall
be payable upon declaration of acceleration of the Maturity thereof
pursuant to Section 501 or the method by which such portion is to be
determined;
(14) if other than Dollars, the Currency in which
payment of the principal of, any premium or interest on or any
Additional Amounts with respect to any of such Securities shall be
payable;
(15) if the principal of, any premium or interest on
or any Additional Amounts with respect to any of such Securities are
to be payable, at the election of the Company or a Holder thereof or
otherwise, in a Currency other than that in which such Securities are
stated to be payable, the period or periods within which, and the
other terms and conditions upon which, such election may be made, and
the time and manner of determining the exchange rate between the
Currency in which such Securities are denominated or stated to be
payable and the Currency in which such Securities or any of them are
to be so payable;
(16) whether the amount of payments of principal of,
any premium
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or interest on or any Additional Amounts with respect to such
Securities may be determined with reference to an index, formula or
other method (which index, formula or method or methods may be based,
without limitation, on one or more Currencies, commodities, equity
indices or other indices), and, if so, the terms and conditions upon
which and the manner in which such amounts shall be determined and
paid or payable;
(17) any deletions from, modifications of or
additions to the Events of Default or covenants of the Company with
respect to any of such Securities, whether or not such Events of
Default or covenants are consistent with the Events of Default or
covenants set forth herein;
(18) the applicability, if any, of Section 402 to
any of such Securities and any provisions in modification of, in
addition to or in lieu of any of the provisions of Section 402;
(19) if any of such Securities are to be issuable
upon the exercise of warrants, this shall be so established and (if
established by Board Resolution) so set forth, as well as the time,
manner and place for such Securities to be authenticated and
delivered;
(20) whether Securities of the series are to be
Convertible Securities and, if so, the initial Conversion Price
applicable thereto, the period or periods within which the conversion
privilege may be exercised, the class of Common Stock into which such
Convertible Securities may be converted and any additions, deletions,
modifications or variations to the provisions of Article Seventeen
hereof applicable thereto;
(21) whether the principal of (and premium, if any)
or interest (including Additional Amounts), if any, on the Securities
of the series are to be payable, at the election of the Company or any
Holder thereof or otherwise, in a currency or currencies, currency
unit or units or composite currency or currencies other than that in
which such Securities or any of them are denominated or stated to be
payable, the period or periods within which, and the other terms and
conditions upon which, such election, if any, may be made, and the
time and manner of determining the exchange rate between the currency
or currencies, currency unit or units or composite currency or
currencies in which such Securities or any of them are denominated or
stated to be payable and the currency or currencies, currency unit or
units or composite currency or currencies in which such Securities or
any of them are to be so payable;
(22) if any of such Securities are to be issuable in
global form and
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are to be issuable in definitive form (whether upon original issue or
upon exchange of a temporary Security) only upon receipt of certain
certificates or other documents or satisfaction of other conditions,
then the form and terms of such certificates, documents or conditions;
(23) if there is more than one Trustee, the identity
of the Trustee and, if not the Trustee, the identity of each Security
Registrar, Paying Agent or Authenticating Agent with respect to such
Securities;
(24) any other terms of such Securities (which terms
shall not be inconsistent with the provisions of this Indenture).
All Securities of any one series and all Coupons, if any,
appertaining to Bearer Securities of such series shall be substantially
identical except as to Currency of payments due thereunder, denomination and
the rate or rates of interest, if any, and Maturity, the date from which
interest, if any, shall accrue and except as may otherwise be provided by the
Company in or pursuant to the Board Resolution and set forth in the Officers'
Certificate or in any indenture or indentures supplemental hereto pertaining to
such series of Securities. All Securities of any one series need not be issued
at the same time and, unless otherwise so provided by the Company, a series may
be reopened for issuances of additional Securities of such series or to
establish additional terms of such series of Securities.
If any of the terms of the Securities of any series shall be
established by action taken by or pursuant to a Board Resolution, the Board
Resolution shall be delivered to the Trustee at or prior to the delivery of the
Officers' Certificate setting forth the terms of such series.
Section 302. Currency; Denominations.
Unless otherwise provided in or pursuant to this Indenture,
the principal of, any premium and interest on and any Additional Amounts with
respect to the Securities shall be payable in Dollars. Unless otherwise
provided in or pursuant to this Indenture, Registered Securities denominated in
Dollars shall be issuable in registered form without Coupons in denominations
of $1,000 and any integral multiple thereof, and the Bearer Securities
denominated in Dollars shall be issuable in the denomination of $5,000.
Securities not denominated in Dollars shall be issuable in such denominations
as are established with respect to such Securities in or pursuant to this
Indenture.
Section 303. Execution, Authentication, Delivery and
Dating.
Securities shall be executed on behalf of the Company by its
Chairman of
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the Board, one of its Vice Chairmen, its President, its Treasurer or one of its
Vice Presidents under its corporate seal reproduced thereon and attested by its
Secretary or one of its Assistant Secretaries. Coupons shall be executed on
behalf of the Company by the Treasurer or any Assistant Treasurer of the
Company. The signature of any of these officers on the Securities or any
Coupons appertaining thereto may be manual or facsimile.
Securities and any Coupons appertaining thereto bearing the
manual or facsimile signatures of individuals who were at any time the proper
officers of the Company shall bind the Company, notwithstanding that such
individuals or any of them have ceased to hold such offices prior to the
authentication and delivery of such Securities or did not hold such offices at
the date of such Securities.
At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities, together with
any Coupons appertaining thereto, executed by the Company, to the Trustee for
authentication, together with the Board Resolution and Officers' Certificate or
supplemental indenture with respect to such Securities referred to in Section
301 and a Company Order for the authentication and delivery of such Securities,
and the Trustee in accordance with the Company Order and subject to the
provisions hereof shall authenticate and deliver such Securities. In
authenticating such Securities, and accepting the additional responsibilities
under this Indenture in relation to such Securities and any Coupons
appertaining thereto, the Trustee shall be entitled to receive, and (subject to
Article Six hereof) shall be fully protected in relying upon an Opinion of
Counsel substantially to the effect that:
(a) the form or forms and terms of such
Securities and Coupons, if any, have been established in conformity
with the provisions of this Indenture;
(b) all conditions precedent to the
authentication and delivery of such Securities and Coupons, if any,
appertaining thereto, have been complied with and that such
Securities, and Coupons, when completed by appropriate insertion and
executed and delivered by the Company to the Trustee for
authentication pursuant to this Indenture, and authenticated and
delivered by the Trustee and issued by the Company in the manner and
subject to any conditions specified in such Opinion of Counsel, will
constitute legally valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms,
subject to bankruptcy, insolvency, reorganization, moratorium,
fraudulent transfer or other similar laws affecting the enforcement of
creditors' rights generally, and subject to general principles of
equity (regardless of whether enforcement is sought in a proceeding in
equity or at law) and except further as enforcement thereof may be
limited by (A) requirements that a claim with respect to any
securities denominated other than in Dollars (or a foreign currency or
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foreign currency unit judgment in respect of such claim) be converted
into Dollars at a rate of exchange prevailing on a date determined
pursuant to applicable law or (B) governmental authority to limit,
delay or prohibit the making of payments in foreign currency or
currency units or payments outside the United States; and will entitle
the Holders thereof to the benefits of this Indenture; such Opinion of
Counsel need express no opinion as to the availability of equitable
remedies;
(c) all laws and requirements in respect of the
execution and delivery by the Company of such Securities and Coupons,
if any, have been complied with; and
(d) as to such other matters as the Trustee may
reasonably request.
If all the Securities of any series are not to be issued at
one time, it shall not be necessary to deliver an Opinion of Counsel and an
Officers' Certificate at the time of issuance of each Security, but such
opinion and certificate, with appropriate modifications, shall be delivered at
or before the time of issuance of the first Security of such series. After any
such first delivery, any separate request by the Company that the Trustee
authenticate Securities of such series for original issue will be deemed to be
a certification by the Company that all conditions precedent provided for in
this Indenture relating to authentication and delivery of such Securities
continue to have been complied with.
The Trustee shall not be required to authenticate or to cause
an Authenticating Agent to authenticate any Securities if the issue of such
Securities pursuant to this Indenture will affect the Trustee's own rights,
duties or immunities under the Securities and this Indenture or otherwise in a
manner which is not reasonably acceptable to the Trustee or if the Trustee,
being advised by counsel, determines that such action may not lawfully be
taken.
Each Registered Security shall be dated the date of its
authentication. Each Bearer Security and any temporary Bearer Security in
global form shall be dated as of the date specified in or pursuant to this
Indenture.
No Security or Coupon appertaining thereto shall be entitled
to any benefit under this Indenture or be valid or obligatory for any purpose,
unless there appears on such Security a certificate of authentication
substantially in the form provided for in Section 202 or 610 executed by or on
behalf of the Trustee by the manual signature of one of its authorized officers
or by an Authenticating Agent. Such certificate upon any Security shall be
conclusive evidence, and the only evidence, that such Security has been duly
authenticated and delivered hereunder. Except as permitted by Section 306
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or 307, the Trustee shall not authenticate and deliver any Bearer Security
unless all Coupons appertaining thereto then matured have been detached and
cancelled.
Section 304. Temporary Securities.
Pending the preparation of definitive Securities, the Company
may execute and deliver to the Trustee and, upon Company Order, the Trustee
shall authenticate and deliver, in the manner provided in Section 303,
temporary Securities in lieu thereof which are printed, lithographed,
typewritten, mimeographed or otherwise produced, in any authorized
denomination, substantially of the tenor of the definitive Securities in lieu
of which they are issued, in registered form or, if authorized in or pursuant
to this Indenture, in bearer form with one or more Coupons or without Coupons
and with such appropriate insertions, omissions, substitutions and other
variations as the officers of the Company executing such Securities may
determine, as conclusively evidenced by their execution of such Securities.
Such temporary Securities may be in global form.
Except in the case of temporary Securities in global form,
which shall be exchanged in accordance with the provisions thereof, if
temporary Securities are issued, the Company shall cause definitive Securities
to be prepared without unreasonable delay. After the preparation of definitive
Securities of the same series and containing terms and provisions that are
identical to those of any temporary Securities, such temporary Securities shall
be exchangeable for such definitive Securities upon surrender of such temporary
Securities at an Office or Agency for such Securities, without charge to any
Holder thereof. Upon surrender for cancellation of any one or more temporary
Securities (accompanied by any unmatured Coupons appertaining thereto), the
Company shall execute and the Trustee shall authenticate and deliver in
exchange therefor a like principal amount of definitive Securities of
authorized denominations of the same series and containing identical terms and
provisions; provided, however, that no definitive Bearer Security, except as
provided in or pursuant to this Indenture, shall be delivered in exchange for a
temporary Registered Security; and provided, further, that a definitive Bearer
Security shall be delivered in exchange for a temporary Bearer Security only in
compliance with the conditions set forth in or pursuant to this Indenture.
Unless otherwise provided in or pursuant to this Indenture with respect to a
temporary global Security, until so exchanged the temporary Securities of any
series shall in all respects be entitled to the same benefits under this
Indenture as definitive Securities of such series.
Section 305. Registration, Transfer and Exchange.
With respect to the Registered Securities of each series, if
any, the Company shall cause to be kept a register (each such register being
herein sometimes referred to as the "Security Register") at an Office or Agency
for such series in which,
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subject to such reasonable regulations as it may prescribe, the Company shall
provide for the registration of the Registered Securities of such series and of
transfers of the Registered Securities of such series. In the event that the
Trustee shall not be the Security Registrar, it shall have the right to examine
the Security Register at all reasonable times. The Trustee is hereby initially
appointed as Security Registrar for each series of Securities. In the event
that the Trustee shall cease to be Security Registrar with respect to a series
of Securities, it shall have the right to examine the Security Register for
such series at all reasonable times.
Upon surrender for registration of transfer of any Registered
Security of any series at any Office or Agency for such series, the Company
shall execute, and the Trustee shall authenticate and deliver, in the name of
the designated transferee or transferees, one or more new Registered Securities
of the same series denominated as authorized in or pursuant to this Indenture,
of a like aggregate principal amount bearing a number not contemporaneously
outstanding and containing identical terms and provisions.
At the option of the Holder, Registered Securities of any
series may be exchanged for other Registered Securities of the same series
containing identical terms and provisions, in any authorized denominations, and
of a like aggregate principal amount, upon surrender of the Securities to be
exchanged at any Office or Agency for such series. Whenever any Registered
Securities are so surrendered for exchange, the Company shall execute, and the
Trustee shall authenticate and deliver, the Registered Securities which the
Holder making the exchange is entitled to receive.
If provided in or pursuant to this Indenture, with respect to
Securities of any series, at the option of the Holder, Bearer Securities of
such series may be exchanged for Registered Securities of such series
containing identical terms, denominated as authorized in or pursuant to this
Indenture and in the same aggregate principal amount, upon surrender of the
Bearer Securities to be exchanged at any Office or Agency for such series, with
all unmatured Coupons and all matured Coupons in default thereto appertaining.
If the Holder of a Bearer Security is unable to produce any such unmatured
Coupon or Coupons or matured Coupon or Coupons in default, such exchange may be
effected if the Bearer Securities are accompanied by payment in funds
acceptable to the Company and the Trustee in an amount equal to the face amount
of such missing Coupon or Coupons, or the surrender of such missing Coupon or
Coupons may be waived by the Company and the Trustee if there is furnished to
them such security or indemnity as they may require to save each of them and
any Paying Agent harmless. If thereafter the Holder of such Bearer Security
shall surrender to any Paying Agent any such missing Coupon in respect of which
such a payment shall have been made, such Holder shall be entitled to receive
the amount of such payment; provided, however, that, except as otherwise
provided in Section 1002, interest
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represented by Coupons shall be payable only upon presentation and surrender of
those Coupons at an Office or Agency for such series located outside the United
States. Notwithstanding the foregoing, in case a Bearer Security of any series
is surrendered at any such Office or Agency for such series in exchange for a
Registered Security of such series and like tenor after the close of business
at such Office or Agency on (i) any Regular Record Date and before the opening
of business at such Office or Agency on the relevant Interest Payment Date, or
(ii) any Special Record Date and before the opening of business at such Office
or Agency on the related date for payment of Defaulted Interest, such Bearer
Security shall be surrendered without the Coupon relating to such Interest
Payment Date or proposed date of payment, as the case may be (or, if such
Coupon is so surrendered with such Bearer Security, such Coupon shall be
returned to the Person so surrendering the Bearer Security), and interest or
Defaulted Interest, as the case may be, shall not be payable on such Interest
Payment Date or proposed date for payment, as the case may be, in respect of
the Registered Security issued in exchange for such Bearer Security, but shall
be payable only to the Holder of such Coupon when due in accordance with the
provisions of this Indenture.
If expressly provided with respect to Securities of any
series, at the option of the Holder, Registered Securities of such series may
be exchanged for Bearer Securities upon such terms and conditions as may be
provided with respect to such series.
Whenever any Securities are surrendered for exchange as
contemplated by the immediately preceding two paragraphs, the Company shall
execute, and the Trustee shall authenticate and deliver, the Securities which
the Holder making the exchange is entitled to receive.
Notwithstanding the foregoing, except as otherwise provided in
or pursuant to this Indenture, any global Security shall be exchangeable for
definitive Securities only if (i) the Depository is at any time unwilling,
unable or ineligible to continue as Depository and a successor depository is
not appointed by the Company within 60 days of the date the Company is so
informed in writing, (ii) the Company executes and delivers to the Trustee a
Company Order to the effect that such global Security shall be so exchangeable,
or (iii) an Event of Default has occurred and is continuing with respect to
the Securities. If the beneficial owners of interests in a global Security
are entitled to exchange such interests for definitive Securities, then without
unnecessary delay but in any event not later than the earliest date on which
such interests may be so exchanged, the Company shall deliver to the Trustee
definitive Securities in such form and denominations as are required by or
pursuant to this Indenture, and of the same series, containing identical terms
and in aggregate principal amount equal to the principal amount of, such global
Security, executed by the Company. On or after the earliest date on which such
interests may be so exchanged, such global Security shall
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be surrendered from time to time by the U.S. Depository or such other
Depository as shall be specified in the Company Order with respect thereto, and
in accordance with instructions given to the Trustee and the U.S. Depository or
such other Depository, as the case may be (which instructions shall be in
writing but need not be contained in or accompanied by an Officers' Certificate
or be accompanied by an Opinion of Counsel), as shall be specified in the
Company Order with respect thereto to the Trustee, as the Company's agent for
such purpose, to be exchanged, in whole or in part, for definitive Securities
as described above without charge. The Trustee shall authenticate and make
available for delivery, in exchange for each portion of such surrendered global
Security, a like aggregate principal amount of definitive Securities of the
same series of authorized denominations and of like tenor as the portion of
such global Security to be exchanged, which (unless such Securities are not
issuable both as Bearer Securities and as Registered Securities, in which case
the definitive Securities exchanged for the global Security shall be issuable
only in the form in which the Securities are issuable, as provided in or
pursuant to this Indenture) shall be in the form of Bearer Securities or
Registered Securities, or any combination thereof, as shall be specified by the
beneficial owner thereof; provided, however, that no such exchanges may occur
during a period beginning at the opening of business 15 days before any
selection of Securities of the same series and continuing identical terms to be
redeemed and ending on the relevant Redemption Date; and provided, further,
that (unless otherwise provided in or pursuant to this Indenture) no Bearer
Security delivered in exchange for a portion of a global Security shall be
mailed or otherwise delivered to any location in the United States. Promptly
following any such exchange in part, such global Security shall be returned by
the Trustee to such Depository or the U.S. Depository, as the case may be, or
such other Depository or U.S. Depository referred to above in accordance with
the instructions of the Company referred to above. If a Registered Security is
issued in exchange for any portion of a global Security after the close of
business at the Office or Agency for such Security where such exchange occurs
on or after (i) any Regular Record Date for such Security and before the
opening of business at such Office or Agency on the next Interest Payment Date,
or (ii) any Special Record Date for such Security and before the opening of
business at such Office or Agency on the related proposed date for payment of
interest or Defaulted Interest, as the case may be, interest shall not be
payable on such Interest Payment Date or proposed date for payment, as the case
may be, in respect of such Registered Security, but shall be payable on such
Interest Payment Date or proposed date for payment, as the case may be, only to
the Person to whom interest in respect of such portion of such global Security
shall be payable in accordance with the provisions of this Indenture.
All Securities issued upon any registration of transfer or
exchange of Securities shall be the valid obligations of the Company evidencing
the same debt and entitling the Holders thereof to the same benefits under this
Indenture as the Securities surrendered upon such registration of transfer or
exchange.
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Every Registered Security presented or surrendered for
registration of transfer or for exchange, redemption or conversion shall (if so
required by the Company or the Security Registrar for such Security) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar for such Security duly
executed by the Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of
transfer or exchange, redemption or conversion of Securities, but the Company
may require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Securities, other than exchanges pursuant to Section 304, 905 or
1107 not involving any transfer.
Except as otherwise provided in or pursuant to this Indenture,
the Company shall not be required (i) to issue, register the transfer of or
exchange any Securities during a period beginning at the opening of business 15
days before the day of the selection for redemption of Securities of like tenor
and the same series under Section 1103 and ending at the close of business (A)
if Securities of the series are issuable only as Registered Securities, on the
day of the mailing of the relevant notice of redemption, and (B) if Securities
of the series are issuable as Bearer Securities, on the day of the first
publication of the relevant notice of redemption or, if Securities of the
series are also issuable as Registered Securities and there is no publication,
the mailing of the relevant notice of redemption, or (ii) to register the
transfer of or exchange any Registered Security so selected for redemption in
whole or in part, except in the case of any Security to be redeemed in part,
the portion thereof not to be redeemed, or (iii) to exchange any Bearer
Security so selected for redemption except, to the extent provided with respect
to such Bearer Security, that such Bearer Security may be exchanged for a
Registered Security of like tenor and the same series, provided that such
Registered Security shall be immediately surrendered for redemption with
written instruction for payment consistent with the provisions of this
Indenture or (iv) to issue, register the transfer of or exchange any Security
which, in accordance with its terms, has been surrendered for repayment at the
option of the Holder, except the portion, if any, of such Security not to be so
repaid.
Section 306. Mutilated, Destroyed, Lost and Stolen
Securities.
If any mutilated Security or a Security with a mutilated
Coupon appertaining to it is surrendered to the Trustee, subject to the
provisions of this Section 306, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a new Security of the same series
containing identical terms and of like principal amount and bearing a number
not contemporaneously outstanding, with Coupons appertaining thereto
corresponding to the Coupons, if any, appertaining to the
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surrendered Security.
If there be delivered to the Company and to the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any
Security or Coupon, and (ii) such security or indemnity as may be required by
them to save each of them and any agent of either of them harmless, then, in
the absence of notice to the Company or the Trustee that such Security or
Coupon has been acquired by a bona fide purchaser, the Company shall execute
and, upon the Company's request the Trustee shall authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Security or in exchange for the Security to which a destroyed, lost or stolen
Coupon appertains with all appurtenant Coupons not destroyed, lost or stolen, a
new Security of the same series containing identical terms and of like
principal amount and bearing a number not contemporaneously outstanding, with
Coupons corresponding to the Coupons, if any, appertaining to such destroyed,
lost or stolen Security or to the Security to which such destroyed, lost or
stolen Coupon appertains.
Notwithstanding the foregoing provisions of this Section 306,
in case any mutilated, destroyed, lost or stolen Security or Coupon has become
or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Security, pay such Security or Coupon; provided,
however, that payment of principal of, any premium or interest on or any
Additional Amounts with respect to any Bearer Securities shall, except as
otherwise provided in Section 1002, be payable only at an Office or Agency for
such Securities located outside the United States and, unless otherwise
provided in or pursuant to this Indenture, any interest on Bearer Securities
and any Additional Amounts with respect to such interest shall be payable only
upon presentation and surrender of the Coupons appertaining thereto.
Upon the issuance of any new Security under this Section 306,
the Company may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security, with any Coupons appertaining thereto
issued pursuant to this Section in lieu of any destroyed, lost or stolen
Security, or in exchange for a Security to which a destroyed, lost or stolen
Coupon appertains shall constitute a separate obligation of the Company,
whether or not the destroyed, lost or stolen Security and Coupons appertaining
thereto or the destroyed, lost or stolen Coupon shall be at any time
enforceable by anyone, and shall be entitled to all the benefits of this
Indenture equally and proportionately with any and all other Securities of such
series and any Coupons, if any, duly issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the
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extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities or Coupons.
Section 307. Payment of Interest and Certain Additional
Amounts; Rights to Interest and Certain
Additional Amounts Preserved.
Unless otherwise provided in or pursuant to this Indenture,
any interest on and any Additional Amounts with respect to any Registered
Security which shall be payable, and are punctually paid or duly provided for,
on any Interest Payment Date shall be paid to the Person in whose name such
Security (or one or more Predecessor Securities) is registered as of the close
of business on the Regular Record Date for such interest. Unless otherwise
provided in or pursuant to this Indenture, in case a Bearer Security is
surrendered in exchange for a Registered Security after the close of business
at an Office or Agency for such Security on any Regular Record Date therefor
and before the opening of business at such Office or Agency on the next
succeeding Interest Payment Date therefor, such Bearer Security shall be
surrendered without the Coupon relating to such Interest Payment Date and
interest shall not be payable on such Interest Payment Date in respect of the
Registered Security issued in exchange for such Bearer Security, but shall be
payable only to the Holder of such Coupon when due in accordance with the
provisions of this Indenture.
Unless otherwise provided in or pursuant to this Indenture,
any interest on and any Additional Amounts with respect to any Registered
Security which shall be payable, but shall not be punctually paid or duly
provided for, on any Interest Payment Date for such Registered Security (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
thereof on the relevant Regular Record Date by virtue of having been such
Holder; and such Defaulted Interest may be paid by the Company, at its election
in each case, as provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any
Defaulted Interest to the Person in whose name such Registered
Security (or a Predecessor Security thereof) shall be registered at
the close of business on a Special Record Date for the payment of such
Defaulted Interest, which shall be fixed in the following manner. The
Company shall notify the Trustee in writing of the amount of Defaulted
Interest proposed to be paid on such Registered Security and the date
of the proposed payment, and at the same time the Company shall
deposit with the Trustee an amount of money equal to the aggregate
amount proposed to be paid in respect of such Defaulted Interest or
shall make arrangements satisfactory to the Trustee for such deposit
on or prior to the date of the proposed payment, such money when so
deposited to be held in trust for the benefit of the Person entitled
to such Defaulted Interest as in this Clause provided. Thereupon, the
Trustee shall fix a Special Record Date for the payment of such
Defaulted
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Interest which shall be not more than 15 days and not less than 10
days prior to the date of the proposed payment and not less than 10
days after the receipt by the Trustee of the notice of the proposed
payment. The Trustee shall promptly notify the Company of such Special
Record Date and, in the name and at the expense of the Company shall
cause notice of the proposed payment of such Defaulted Interest and
the Special Record Date therefor to be mailed, first-class postage
prepaid, to the Holder of such Registered Security (or a Predecessor
Security thereof) at his address as it appears in the Security
Register not less than 10 days prior to such Special Record Date. The
Trustee may, in its discretion, in the name and at the expense of the
Company cause a similar notice to be published at least once in an
Authorized Newspaper of general circulation in the Borough of
Manhattan, The City of New York, but such publication shall not be a
condition precedent to the establishment of such Special Record Date.
Notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor having been mailed as aforesaid, such
Defaulted Interest shall be paid to the Person in whose name such
Registered Security (or a Predecessor Security thereof) shall be
registered at the close of business on such Special Record Date and
shall no longer be payable pursuant to the following Clause (2). In
case a Bearer Security is surrendered at the Office or Agency for such
Security in exchange for a Registered Security after the close of
business at such Office or Agency on any Special Record Date and
before the opening of business at such Office or Agency on the related
proposed date for payment of Defaulted Interest, such Bearer Security
shall be surrendered without the Coupon relating to such proposed date
of payment and Defaulted Interest shall not be payable on such
proposed date of payment in respect of the Registered Security issued
in exchange for such Bearer Security, but shall be payable only to the
Holder of such Coupon when due in accordance with the provisions of
this Indenture.
(2) The Company may make payment of any Defaulted
Interest in any other lawful manner not inconsistent with the
requirements of any securities exchange on which such Security may be
listed, and upon such notice as may be required by such exchange, if,
after notice given by the Company to the Trustee of the proposed
payment pursuant to this Clause, such payment shall be deemed
practicable by the Trustee.
At the option of the Company, interest on Registered
Securities that bear interest may be paid by mailing a check to the address of
the Person entitled thereto as such address shall appear in the Security
Register.
Subject to the foregoing provisions of this Section 307 and
Section 305, each Security delivered under this Indenture upon registration of
transfer of or in exchange for or in lieu of any other Security shall carry the
rights to interest accrued and
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unpaid, and to accrue, which were carried by such other Security.
Section 308. Persons Deemed Owners.
Prior to due presentment of a Registered Security for
registration of transfer, the Company, the Trustee and any agent of the Company
or the Trustee may treat the Person in whose name such Registered Security is
registered in the Security Register as the owner of such Registered Security
for the purpose of receiving payment of principal of, any premium and (subject
to Sections 305 and 307) interest on and any Additional Amounts with respect to
such Registered Security and for all other purposes whatsoever, whether or not
any payment with respect to such Registered Security shall be overdue, and
neither the Company, nor the Trustee or any agent of the Company or the Trustee
shall be affected by notice to the contrary.
The Company, the Trustee and any agent of the Company or the
Trustee may treat the bearer of any Bearer Security or the bearer of any Coupon
as the absolute owner of such Security or Coupon for the purpose of receiving
payment thereof or on account thereof, for the purpose of conversion and for
all other purposes whatsoever, whether or not any payment with respect to such
Security or Coupon shall be overdue, and neither the Company, nor the Trustee
or any agent of the Company or the Trustee shall be affected by notice to the
contrary.
No holder of any beneficial interest in any global Security
held on its behalf by a Depository shall have any rights under this Indenture
with respect to such global Security, and such Depository may be treated by the
Company, the Trustee, and any agent of the Company or the Trustee as the owner
of such global Security for all purposes whatsoever. None of the Company, the
Trustee, any Paying Agent or the Security Registrar will have any
responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests of a global Security
or for maintaining, supervising or reviewing any records relating to such
beneficial ownership interests.
Section 309. Cancellation.
All Securities and Coupons surrendered for payment,
redemption, registration of transfer, exchange or conversion or for credit
against any sinking fund payment shall, if surrendered to any Person other than
the Trustee, be delivered to the Trustee, and any such Securities and Coupons,
as well as Securities and Coupons surrendered directly to the Trustee for any
such purpose, shall be cancelled promptly by the Trustee. The Company may at
any time deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which the Company may have acquired in
any manner whatsoever, and all Securities so delivered shall be
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cancelled promptly by the Trustee. No Securities shall be authenticated in
lieu of or in exchange for any Securities cancelled as provided in this
Section, except as expressly permitted by or pursuant to this Indenture. All
cancelled Securities and Coupons held by the Trustee shall be destroyed by the
Trustee, unless by a Company Order the Company directs their return to it in a
timely manner.
Section 310. Computation of Interest.
Except as otherwise provided in or pursuant to this Indenture,
interest on the Securities shall be computed on the basis of a 360-day year of
twelve 30-day months.
ARTICLE FOUR
SATISFACTION AND DISCHARGE
Section 401. Satisfaction and Discharge of Indenture.
Upon the direction of the Company by a Company Order, this
Indenture shall cease to be of further effect (except as to any surviving
rights of conversion, registration of transfer or exchange of Securities herein
expressly provided for and any right to receive Additional Amounts), and the
Trustee, on receipt of a Company Order, at the expense of the Company, shall
execute proper instruments acknowledging satisfaction and discharge of this
Indenture, when
(1) either
(A) all Securities theretofore
authenticated and delivered and all Coupons appertaining
thereto (other than (i) Coupons appertaining to Bearer
Securities surrendered in exchange for Registered Securities
and maturing after such exchange whose surrender is not
required or has been waived as provided in Section 305, (ii)
Securities and Coupons which have been destroyed, lost or
stolen and which have been replaced or paid as provided in
Section 306, (iii) Coupons appertaining to Securities called
for redemption and maturing after the relevant Redemption Date
whose surrender has been waived as provided in Section 1107,
and (iv) Securities and Coupons for whose payment money has
theretofore been deposited in trust or segregated and held in
trust by the Company and thereafter repaid to the Company or
discharged from such trust, as provided in Section 1003) have
been delivered to the Trustee for cancellation; or
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(B) all Securities and, in the case of
(i) or (ii) below, any Coupons appertaining thereto not
theretofore delivered to the Trustee for cancellation
(i) have become due and payable, or
(ii) will become due and payable at
their Stated Maturity within one year, or
(iii) if redeemable at the option of
the Company, are to be called for redemption within
one year under arrangements satisfactory to the
Trustee for the giving of notice of redemption by the
Trustee in the name, and at the expense, of the
Company,
and the Company, in the case of (i), (ii) or (iii) above, has
deposited or caused to be deposited with the Trustee as trust
funds in trust for such purpose, money and/or Government
Obligations which through the payment of interest and
principal in respect thereof in accordance with their terms,
without consideration of any reinstatement thereof, will
provide not later than the opening of business on the due
dates of any payment of principal and any premium, interest
and Additional Amounts with respect thereto, or a combination
thereof, money in an amount sufficient to pay and discharge
the entire indebtedness on such Securities and Coupons not
theretofore delivered to the Trustee for cancellation,
including the principal of, any premium and interest on, and
any Additional Amounts with respect to such Securities and any
Coupons appertaining thereto, to the date of such deposit (in
the case of Securities which have become due and payable) or
to the Maturity thereof, as the case may be;
(2) the Company has paid or caused to be paid
all other sums payable hereunder by the Company;
(3) the Company has delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to the satisfaction
and discharge of this Indenture have been complied with; and
(4) the Company has delivered to the Trustee a
certificate of Independent Public Accountants certifying as to the
sufficiency of the amounts deposited pursuant to subclause (B) of
Clause (1) of this Section 401 for payment of the principal and any
premium, interest and Additional Amounts with respect thereto on the
dates such payments are due.
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In the event there are Securities of two or more series
hereunder, the Trustee shall be required to execute an instrument acknowledging
satisfaction and discharge of this Indenture only if requested to do so with
respect to Securities of all series as to which it is Trustee and if the other
conditions thereto are met. In the event there are two or more Trustees
hereunder, then the effectiveness of any such instrument shall be conditioned
upon receipt of each such instrument from all Trustees hereunder.
Notwithstanding the satisfaction and discharge of this
Indenture, the obligations of the Company to the Trustee under Section 605, the
obligations of the Trustee to any Authenticating Agent under Section 610 and,
if money and/or Government Obligations shall have been deposited with the
Trustee pursuant to subclause (B) of Clause (1) of this Section, the
obligations of the Trustee under Section 403 and the last paragraph of Section
1003 shall survive.
In the event that, subsequent to the date a discharge is
effected pursuant to this Section 401, Additional Amounts in excess of those
established as of the date such discharge is effected become payable in respect
of any Securities, in order to preserve the benefits of the discharge
established hereunder, the Company shall deposit or cause to be deposited in
accordance with provisions of this Section 401, within ten business days prior
to the earlier to occur of (i) one year after the existence of such excess
Additional Amounts is established and (ii) the date the first payment in
respect of any portion of such excess Additional Amounts becomes due, such
additional funds as are necessary to satisfy the provisions of this Section 401
as if a discharge were being effected as of the date of such subsequent
deposit. For purposes of this paragraph, the existence of excess Additional
Amounts shall be deemed to have been established as of the date the
governmental authority imposing the tax, assessment or other governmental
charge resulting in the Additional Amounts first publishes the legislation,
regulation or other enactment adopting such tax, assessment or other
governmental charge. Failure to comply with the requirements of this paragraph
shall result in the termination of the benefits of the discharge established by
this Section 401.
Section 402. Satisfaction, Discharge and Defeasance of
Securities of any Series.
If provision is made in or pursuant to this Indenture for
defeasance of Securities of any series and any Coupons appertaining thereto
pursuant to this Section 402, the Company shall be deemed to have paid and
discharged the entire indebtedness on all the Outstanding Securities of such
series and the Trustee, at the expense of the Company, shall execute proper
instruments acknowledging satisfaction and discharge of such indebtedness, when
(1) no Event of Default has occurred and is
continuing, or would
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occur upon the giving of notice or the lapse of time at the time such
satisfaction and discharge is being effected and either
(A) with respect to all Outstanding
Securities of such series and any Coupons appertaining
thereto, the Company has irrevocably deposited or caused to be
deposited with the Trustee, as trust funds and/or obligations
in trust for such purpose, money and/or Government Obligations
which through the payment of interest and principal in respect
thereof in accordance with their terms, without consideration
of any reinvestment thereof, will provide not later than the
opening of business on the due dates of any payment of
principal and any premium, interest and Additional Amounts
with respect thereto, or a combination thereof, money in an
amount sufficient to pay and discharge the entire indebtedness
on all Outstanding Securities of such series and any Coupons
appertaining thereto not theretofore delivered to the Trustee
for cancellation, including the principal of, any premium and
interest on, and any Additional Amounts with respect to such
Securities and any Coupons appertaining thereto to the date of
such deposit (in the case of Securities which have become due
and payable) or to the Maturity thereof, as the case may be,
as contemplated by the penultimate paragraph of this Section
402; or
(B) the Company has properly fulfilled
such other means of satisfaction and discharge as is provided
in or pursuant to this Indenture for the Securities of such
series; and
(2) the Company has paid or caused to be paid all
other sums payable hereunder with respect to the Outstanding
Securities of such series and any Coupons appertaining thereto; and
(3) the Company has delivered to the Trustee a
certificate signed by Independent Public Accountants certifying as to
the sufficiency of the amounts deposited pursuant to subsections
(A)(i) or (ii) of this Section for payment of the principal of, any
premium and interest on and any Additional Amounts with respect to
such Securities and any Coupons appertaining thereto on the dates such
payments are due, an Officers' Certificate and an Opinion of Counsel,
each such Certificate and Opinion stating that no Event of Default or
event which with notice or lapse of time or both would become an Event
of Default with respect to such Securities shall have occurred and all
conditions precedent herein provided for relating to the satisfaction
and discharge of the entire indebtedness on all Outstanding Securities
of any such series and any Coupons appertaining thereto shall have
been complied with; and
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(4) the Company has delivered to the Trustee
(A) an opinion of independent counsel
that the Holders of the Securities of such series and any
Coupons appertaining thereto shall have no federal income tax
consequences as a result of such deposit and termination; and
(B) if the Securities of such series are
then listed on the New York Stock Exchange, an opinion of
independent counsel that the Securities of such series shall
not be delisted as a result of the exercise of this option.
Any deposits with the Trustee referred to in subsection (1)(A)
of this Section shall be irrevocable and shall be made under the terms of an
escrow trust agreement in form and substance satisfactory to the Trustee. If
any Outstanding Securities of such series are to be redeemed prior to their
Stated Maturity, whether pursuant to any optional redemption provisions or in
accordance with any mandatory sinking fund requirement or otherwise, the
Company shall make such arrangements as are satisfactory to the Trustee for the
giving of notice of redemption by the Trustee in the name, and at the expense,
of the Company.
Upon the satisfaction of the conditions set forth in this
Section 402 with respect to all the Outstanding Securities of any series and
any Coupons appertaining thereto, the terms and conditions of such series
(including the terms and conditions with respect thereto set forth in this
Indenture, other than the provisions of Sections 305, 306, and 1002 and other
than the right of Holders of Securities of such series and any Coupons
appertaining thereto to receive, from the trust fund described in this Section,
payment of the principal of, any premium or the interest on, or any Additional
Amounts with respect to such Securities and any Coupons appertaining thereto
when such payments shall be due) and the rights, powers, duties and immunities
of the Trustee hereunder with respect to the Securities of such series shall no
longer be binding upon, or applicable to, the Company; provided that the
Company shall not be discharged from any payment obligations in respect of
Securities of such series or any Coupons appertaining thereto which are deemed
not to be Outstanding under clause (iii) of the definition of Outstanding if
such obligations continue to be valid obligations of the Company under
applicable law.
In the event that, subsequent to the date a defeasance is
effected pursuant to this Section 402 with respect to Securities of any series,
Additional Amounts in excess of those established as of the date such
defeasance is effected become payable in respect of such Securities, in order
to preserve the benefits of the defeasance established hereunder with respect
to such series, the Company shall deposit or cause
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to be deposited in accordance with the provisions of this Section 402, within
ten business days prior to the earlier to occur of (i) one year after the
existence of such excess Additional Amounts is established and (ii) the date
the first payment in respect of any portion of such excess Additional Amounts
becomes due, such additional funds as are necessary to satisfy the provisions
of this Section 402 as if a defeasance were being effected as of the date of
such subsequent deposit. For purposes of this paragraph, the existence of
excess Additional Amounts shall be deemed to have been established as of the
date the governmental authority imposing the tax, assessment or other
governmental charge resulting in the Additional Amounts first publishes the
legislation, regulation or other enactment adopting such tax, assessment or
other governmental charge. Failure to comply with the requirements of this
paragraph shall result in the termination of the benefits of the defeasance
established by this Section 402 with respect to the Securities of such series.
Section 403. Application of Trust Money.
Subject to the provisions of the last paragraph of Section
1003, all money and Government Obligations deposited with the Trustee pursuant
to Section 401 or 402 shall be held in trust and applied by it, in accordance
with the provisions of the Securities, the Coupons and this Indenture, to the
payment, either directly or through any Paying Agent (including the Company
acting as its own Paying Agent) as the Trustee may determine, to the Persons
entitled thereto, of the principal, premium, interest and Additional Amounts
for whose payment such money has or Government Obligations have been deposited
with or received by the Trustee; but such money and Government Obligations need
not be segregated from other funds except to the extent required by law.
ARTICLE FIVE
REMEDIES
Section 501. Events of Default.
"Event of Default", wherever used herein with respect to
Securities of any series, means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or be
effected by operation of law pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body):
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(1) default in the payment of any interest on or
any Additional Amounts payable in respect of any Security of such
series when such interest becomes or such Additional Amounts become
due and payable, and continuance of such default for a period of 30
days; or
(2) default in the payment of the principal of
and any premium on any Security of such series when it becomes due and
payable at its Maturity; or
(3) default in the deposit of any sinking fund
payment, when and as due by the terms of a Security of such series; or
(4) default in the performance, or breach, of any
covenant or warranty of the Company in this Indenture or the
Securities (other than a covenant or warranty a default in the
performance or the breach of which is elsewhere in this Section
specifically dealt with or which has been expressly included in this
Indenture solely for the benefit of a series of Securities other than
such series), and continuance of such default or breach for a period
of 60 days after there has been given, by registered or certified
mail, to the Company by the Trustee or to the Company and the Trustee
by the Holders of at least 25% in principal amount of the Outstanding
Securities of such series a written notice specifying such default or
breach and requiring it to be remedied and stating that such notice is
a "Notice of Default" hereunder; or
(5) if any event of default as defined in any
mortgage, indenture or instrument under which there may be issued, or
by which there may be secured or evidenced, any indebtedness of the
Company or any Significant Subsidiary for money borrowed, whether such
indebtedness now exists or shall hereafter be created, shall happen
and shall result in such indebtedness in principal amount in excess of
$10,000,000 becoming or being declared due and payable prior to the
date on which it would otherwise become due and payable, and such
acceleration shall not be rescinded or annulled within a period of 30
days after there shall have been given, by registered or certified
mail, to the Company by the Trustee or to the Company and the Trustee
by the Holders of at least 25% in principal amount of the Outstanding
Securities of such series, a written notice specifying such event of
default and requiring the Company to cause such acceleration to be
rescinded or annulled and stating that such notice is a "Notice of
Default" hereunder; or
(6) the entry by a court having competent
jurisdiction of:
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(a) a decree or order for relief in
respect of the Company or any Significant Subsidiary in an
involuntary proceeding under any applicable bankruptcy,
insolvency, reorganization or other similar law and such
decree or order shall remain unstayed and in effect for a
period of 60 consecutive days; or
(b) a decree or order adjudging the
Company or any Significant Subsidiary to be insolvent, or
approving a petition seeking reorganization, arrangement,
adjustment or composition of the Company or any Significant
Subsidiary and such decree or order shall remain unstayed and
in effect for a period of 60 consecutive days; or
(c) a final and non-appealable order
appointing a custodian, receiver, liquidator, assignee,
trustee or other similar official of the Company or any
Significant Subsidiary or of any substantial part of the
property of the Company or any Significant Subsidiary, as the
case may be, or ordering the winding up or liquidation of the
affairs of the Company or any Significant Subsidiary; or
(7) the commencement by the Company or any
Significant Subsidiary of a voluntary proceeding under any applicable
bankruptcy, insolvency, reorganization or other similar law or of a
voluntary proceeding seeking to be adjudicated insolvent or the
consent by the Company or any Significant Subsidiary to the entry of a
decree or order for relief in an involuntary proceeding under any
applicable bankruptcy, insolvency, reorganization or other similar law
or to the commencement of any insolvency proceedings against it, or
the filing by the Company or any Significant Subsidiary of a petition
or answer or consent seeking reorganization or relief under any
applicable law, or the consent by the Company or any Significant
Subsidiary to the filing of such petition or to the appointment of or
taking possession by a custodian, receiver, liquidator, assignee,
trustee or similar official of the Company or any Significant
Subsidiary or any substantial part of the property of the Company or
any Significant Subsidiary or the making by the Company or any
Significant Subsidiary of an assignment for the benefit of creditors,
or the taking of corporate action by the Company or any Significant
Subsidiary in furtherance of any such action; or
(8) any other Event of Default provided in or
pursuant to this Indenture with respect to Securities of such series.
Section 502. Acceleration of Maturity; Rescission and
Annulment.
If an Event of Default with respect to Securities of any
series at the time
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Outstanding occurs and is continuing, then the Trustee or the Holders of not
less than 25% in principal amount of the Outstanding Securities of such series
may declare the principal of all the Securities of such series, or such lesser
amount as may be provided for in the Securities of such series, to be due and
payable immediately, by a notice in writing to the Company (and to the Trustee
if given by the Holders), and upon any such declaration such principal or such
lesser amount shall become immediately due and payable.
At any time after such a declaration of acceleration with
respect to Securities of any series has been made and before a judgment or
decree for payment of the money due has been obtained by the Trustee as
hereinafter in this Article provided, the Holders of not less than a majority
in principal amount of the Outstanding Securities of such series, by written
notice to the Company and the Trustee, may rescind and annul such declaration
and its consequences if:
(1) the Company has paid or deposited with the
Trustee a sum of money sufficient to pay
(A) all overdue installments of any
interest on and any Additional Amounts with respect to all
Securities of such series and any Coupon appertaining thereto,
(B) the principal of and any premium on
any Securities of such series which have become due otherwise
than by such declaration of acceleration and interest thereon
at the rate or rates borne by or provided for in such
Securities,
(C) to the extent that payment of such
interest is lawful, interest upon overdue installments of any
interest and Additional Amounts at the rate or rates borne by
or provided for in such Securities, and
(D) all sums paid or advanced by the
Trustee hereunder and the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and
counsel; and
(2) all Events of Default with respect to
Securities of such series, other than the non-payment of the principal
of, any premium and interest on, and any Additional Amounts with
respect to Securities of such series which shall have become due
solely by such declaration of acceleration, shall have been cured or
waived as provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent
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thereon.
Section 503. Collection of Indebtedness and Suits for
Enforcement by Trustee.
The Company covenants that if
(1) default is made in the payment of any
installment of interest on or any Additional Amounts with respect to
any Security or any Coupon appertaining thereto when such interest or
Additional Amounts shall have become due and payable and such default
continues for a period of 30 days, or
(2) default is made in the payment of the
principal of or any premium on any Security at its Maturity,
the Company shall, upon demand of the Trustee, pay to the Trustee, for the
benefit of the Holders of such Securities and any Coupons appertaining thereto,
the whole amount of money then due and payable with respect to such Securities
and any Coupons appertaining thereto, with interest upon the overdue principal,
any premium and, to the extent that payment of such interest shall be legally
enforceable, upon any overdue installments of interest and Additional Amounts
at the rate or rates borne by or provided for in such Securities, and, in
addition thereto, such further amount of money as shall be sufficient to cover
the costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel.
If the Company fails to pay the money it is required to pay
the Trustee pursuant to the preceding paragraph forthwith upon the demand of
the Trustee, the Trustee, in its own name and as trustee of an express trust,
may institute a judicial proceeding for the collection of the money so due and
unpaid, and may prosecute such proceeding to judgment or final decree, and may
enforce the same against the Company or any other obligor upon such Securities
and any Coupons appertaining thereto and collect the moneys adjudged or decreed
to be payable in the manner provided by law out of the property of the Company
or any other obligor upon such Securities and any Coupons appertaining thereto,
wherever situated.
If an Event of Default with respect to Securities of any
series occurs and is continuing, the Trustee may in its discretion proceed to
protect and enforce its rights and the rights of the Holders of Securities of
such series and any Coupons appertaining thereto by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect and enforce any
such rights, whether for the specific enforcement of any covenant or agreement
in this Indenture or such Securities or in aid of the exercise
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of any power granted herein or therein, or to enforce any other proper remedy.
Section 504. Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition
or other judicial proceeding relative to the Company or any other obligor upon
the Securities or the property of the Company or such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the Securities
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company for the payment of any overdue principal, premium, interest or
Additional Amounts) shall be entitled and empowered, by intervention in such
proceeding or otherwise,
(i) to file and prove a claim for the
whole amount, or such lesser amount as may be provided for in
the Securities of such series, of the principal and any
premium, interest and Additional Amounts owing and unpaid in
respect of the Securities and any Coupons appertaining thereto
and to file such other papers or documents as may be necessary
or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its
agents or counsel) and of the Holders of Securities or any
Coupons allowed in such judicial proceeding, and
(ii) to collect and receive any monies or
other property payable or deliverable on any such claims and
to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder of Securities or any Coupons to make such payments to the Trustee
and, in the event that the Trustee shall consent to the making of such payments
directly to the Holders of Securities or any Coupons, to pay to the Trustee any
amount due to it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel and any other amounts due the
Trustee under Section 605.
Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
of a Security or any Coupon any plan of reorganization, arrangement, adjustment
or composition affecting the Securities or Coupons or the rights of any Holder
thereof, or to authorize the Trustee to vote in respect of the claim of any
Holder of a Security or any Coupon in any such proceeding.
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Section 505. Trustee May Enforce Claims without
Possession of Securities or Coupons.
All rights of action and claims under this Indenture or any
of the Securities or Coupons may be prosecuted and enforced by the Trustee
without the possession of any of the Securities or Coupons or the production
thereof in any proceeding relating thereto, and any such proceeding instituted
by the Trustee shall be brought in its own name as trustee of an express trust,
and any recovery or judgment, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, shall be for the ratable benefit of each and every Holder of a
Security or Coupon in respect of which such judgment has been recovered.
Section 506. Application of Money Collected.
Subject to the provisions of Article Sixteen, any money
collected by the Trustee pursuant to this Article shall be applied in the
following order, at the date or dates fixed by the Trustee and, in case of the
distribution of such money on account of principal, or any premium, interest or
Additional Amounts, upon presentation of the Securities or Coupons, or both, as
the case may be, and the notation thereon of the payment if only partially paid
and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the
Trustee and any predecessor Trustee under Section 605;
SECOND: To the payment of the amounts then due and
unpaid upon the Securities and any Coupons for principal and any
premium, interest and Additional Amounts in respect of which or for
the benefit of which such money has been collected, ratably, without
preference or priority of any kind, according to the aggregate amounts
due and payable on such Securities and Coupons for principal and any
premium, interest and Additional Amounts, respectively;
THIRD: The balance, if any, to the Person or Persons
entitled thereto.
Section 507. Limitations on Suits.
No Holder of any Security of any series or any Coupons
appertaining thereto shall have any right to institute any proceeding, judicial
or otherwise, with respect to this Indenture, or for the appointment of a
receiver or trustee, or for any other remedy hereunder, unless
(1) such Holder has previously given written
notice to the Trustee
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of a continuing Event of Default with respect to the Securities of
such series;
(2) the Holders of not less than 25% in principal
amount of the Outstanding Securities of such series shall have made
written request to the Trustee to institute proceedings in respect of
such Event of Default in its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the
Trustee reasonable indemnity against the costs, expenses and
liabilities to be incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of
such notice, request and offer of indemnity has failed to institute
any such proceeding; and
(5) no direction inconsistent with such written
request has been given to the Trustee during such 60-day period by the
Holders of a majority in principal amount of the Outstanding
Securities of such series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture or any Security to affect, disturb or prejudice the rights of
any other such Holders or Holders of Securities of any other series, or to
obtain or to seek to obtain priority or preference over any other Holders or to
enforce any right under this Indenture, except in the manner herein provided
and for the equal and ratable benefit of all such Holders.
Section 508. Unconditional Right of Holders to Receive
Principal and any Premium, Interest and
Additional Amounts and to Convert any
Convertible Security.
Notwithstanding any other provision in this Indenture, the
Holder of any Security or Coupon shall have the right, which is absolute and
unconditional, to receive payment of the principal of, any premium and (subject
to Sections 305 and 307) interest on, and any Additional Amounts with respect
to such Security or payment of such Coupon, as the case may be, on the
respective Stated Maturity or Maturities therefor specified in such Security or
Coupon (or, in the case of redemption, on the Redemption Date or, in the case
of repayment at the option of such Holder if provided in or pursuant to this
Indenture, on the date such repayment is due) and to institute suit for the
enforcement of any such payment, and shall have the right to convert any such
Security which is a Convertible Security in accordance with the terms hereof
and thereof and to institute suit for enforcement of such right; and such
rights shall not be impaired without
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the consent of such Holder.
Section 509. Restoration of Rights and Remedies.
If the Trustee or any Holder of a Security or a Coupon has
instituted any proceeding to enforce any right or remedy under this Indenture
and such proceeding has been discontinued or abandoned for any reason, or has
been determined adversely to the Trustee or to such Holder, then and in every
such case the Company, the Trustee and each such Holder shall, subject to any
determination in such proceeding, be restored severally and respectively to
their former positions hereunder, and thereafter all rights and remedies of the
Trustee and each such Holder shall continue as though no such proceeding had
been instituted.
Section 510. Rights and Remedies.
Except as otherwise provided with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities or Coupons in the
last paragraph of Section 306, no right or remedy herein conferred upon or
reserved to the Trustee or to each and every Holder of a Security or a Coupon
is intended to be exclusive of any other right or remedy, and every right and
remedy, to the extent permitted by law, shall be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at
law or in equity or otherwise. The assertion or employment of any right or
remedy hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
Section 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any
Security or Coupon to exercise any right or remedy accruing upon any Event of
Default shall impair any such right or remedy or constitute a waiver of any
such Event of Default or an acquiescence therein. Every right and remedy given
by this Article or by law to the Trustee or to any Holder of a Security or a
Coupon may be exercised from time to time, and as often as may be deemed
expedient, by the Trustee or by such Holder, as the case may be.
Section 512. Control by Holders of Securities.
The Holders of a majority in principal amount of the
Outstanding Securities of any series shall have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee or exercising any trust or power conferred on the Trustee with respect
to the Securities of such series and any Coupons appertaining thereto, provided
that
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(1) such direction shall not be in conflict with
any rule of law or with this Indenture or with the Securities of any
series,
(2) the Trustee may take any other action deemed
proper by the Trustee which is not inconsistent with such direction,
and
(3) such direction is not unduly prejudicial to
the rights of the other Holders of Securities of such series not
joining in such action.
Section 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of
the Outstanding Securities of any series on behalf of the Holders of all the
Securities of such series and any Coupons appertaining thereto may waive any
past default hereunder with respect to such series and its consequences, except
a default
(1) in the payment of the principal of, any
premium or interest on, or any Additional Amounts with respect to any
Security of such series or any Coupons appertaining thereto, or
(2) in respect of a covenant or provision hereof
which under Article Nine cannot be modified or amended without the
consent of the Holder of each Outstanding Security of such series
affected.
Upon any such waiver, such default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other default or impair any right consequent thereon.
Section 514. Waiver of Stay or Extension Laws.
The Company covenants that (to the extent that it may lawfully
do so) it will not at any time insist upon, or plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay or extension law
wherever enacted, now or at any time hereafter in force, which may affect the
covenants or the performance of this Indenture; and the Company expressly
waives (to the extent that it may lawfully do so) all benefit or advantage of
any such law and covenant 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.
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ARTICLE SIX
THE TRUSTEE
Section 601. Certain Rights of Trustee.
Subject to Sections 315(a) through 315(d) of the Trust
Indenture Act:
(a) the Trustee may rely and shall be protected
in acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, coupon or other paper or
document reasonably believed by it to be genuine and to have been
signed or presented by the proper party or parties;
(b) any request or direction of the Company
mentioned herein shall be sufficiently evidenced by a Company Request
or a Company Order (in each case, other than delivery of any Security,
together with any Coupons appertaining thereto, to the Trustee for
authentication and delivery pursuant to Section 303 which shall be
sufficiently evidenced as provided therein) and any resolution of the
Board of Directors may be sufficiently evidenced by a Board
Resolution;
(c) whenever in the administration of this
Indenture the Trustee shall deem it desirable that a matter be proved
or established prior to taking, suffering or omitting any action
hereunder, the Trustee (unless other evidence shall be herein
specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officers' Certificate;
(d) the Trustee may consult with counsel and the
advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in reliance
thereon;
(e) the Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by or pursuant to
this Indenture at the request or direction of any of the Holders of
Securities of any series or any Coupons appertaining thereto pursuant
to this Indenture, unless such Holders shall have offered to the
Trustee reasonable security or indemnity against the costs, expenses
and liabilities which might be incurred by it in compliance with such
request or direction;
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(f) the Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, coupon 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, during business hours
and upon reasonable notice, the books, records and premises of the
Company, personally or by agent or attorney; and
(g) the Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by
or through agents or attorneys and the Trustee shall not be
responsible for any misconduct or negligence on the part of any agent
or attorney appointed with due care by it hereunder.
Section 602. Not Responsible for Recitals or Issuance of
Securities.
The recitals contained herein and in the Securities, except
the Trustee's certificate of authentication, and in any Coupons shall be taken
as the statements of the Company and neither the Trustee nor any Authenticating
Agent assumes any responsibility for their correctness. The Trustee makes no
representations as to the validity or sufficiency of this Indenture or of the
Securities or the Coupons, except that the Trustee represents that it is duly
authorized to execute and deliver this Indenture, authenticate the Securities
and perform its obligations hereunder and that the statements made by it in a
Statement of Eligibility and Qualification on Form T-1 supplied to the Company
are true and accurate, subject to the qualifications set forth therein. Neither
the Trustee nor any Authenticating Agent shall be accountable for the use or
application by the Company of the Securities or the proceeds thereof.
Section 603. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any
Security Registrar or any other Person that may be an agent of the Trustee or
the Company, in its individual or any other capacity, may become the owner or
pledgee of Securities or Coupons and, subject to Sections 310(b) and 311 of the
Trust Indenture Act, may otherwise deal with the Company with the same rights
it would have if it were not Trustee, Authenticating Agent, Paying Agent,
Security Registrar or such other Person.
Section 604. Money Held in Trust.
Except as provided in Section 403 and Section 1003, money
held by the
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Trustee in trust hereunder need not be segregated from other funds except to
the extent required by law and shall be held uninvested. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
otherwise agreed with the Company.
Section 605. Compensation and Reimbursement.
The Company agrees:
(1) to pay to the Trustee from time to time
reasonable compensation for all services rendered by the Trustee
hereunder (which compensation shall not be limited by any provision of
law in regard to the compensation of a trustee of an express trust);
(2) except as otherwise expressly provided
herein, to reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Trustee
in accordance with any provision of this Indenture (including the
reasonable compensation and the expenses and disbursements of its
agents and counsel), except any such expense, disbursement or advance
as may be attributable to the Trustee's negligence or bad faith; and
(3) to indemnify the Trustee and its agents for,
and to hold them harmless against, any loss, liability or expense
incurred without negligence or bad faith on their part, arising out of
or in connection with the acceptance or administration of the trust or
trusts hereunder, including the costs and expenses of defending
themselves against any claim or liability in connection with the
exercise or performance of any of their powers or duties hereunder.
As security for the performance of the obligations of the
Company under this Section 605, the Trustee shall have a lien prior to the
Securities of any series upon all property and funds held or collected by the
Trustee as such (and not subordinated in right of payment to the prior payment
in full of the Senior Indebtedness), except funds held in trust for the payment
of principal of, and premium or interest on or any Additional Amounts with
respect to Securities or any Coupons appertaining thereto.
Section 606. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder that
is a Corporation permitted by the Trust Indenture Act to act as trustee under
an indenture qualified under the Trust Indenture Act and that has a combined
capital and surplus (computed in accordance with Section 310(a)(2) of the Trust
Indenture Act) of at least $50,000,000.
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If at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section 606, it shall resign immediately in the manner and
with the effect hereinafter specified in this Article.
Section 607. Resignation and Removal; Appointment of
Successor.
(a) No resignation or removal of the Trustee and
no appointment of a successor Trustee pursuant to this Article shall
become effective until the acceptance of appointment by the successor
Trustee pursuant to Section 608.
(b) The Trustee may resign at any time with
respect to the Securities of one or more series by giving written
notice thereof to the Company. If the instrument of acceptance by a
successor Trustee required by Section 608 shall not have been
delivered to the Trustee within 30 days after the giving of such
notice of resignation, the resigning Trustee may petition any court of
competent jurisdiction for the appointment of a successor Trustee with
respect to such series.
(c) The Trustee may be removed at any time with
respect to the Securities of any series by Act of the Holders of a
majority in principal amount of the Outstanding Securities of such
series, delivered to the Trustee and the Company.
(d) If at any time:
(1) the Trustee shall fail to comply
with the obligations imposed upon it under Section 310(b) of
the Trust Indenture Act with respect to Securities of any
series after written request therefor by the Company or any
Holder of a Security of such series who has been a bona fide
Holder of a Security of such series for at least six months,
or
(2) the Trustee shall cease to be
eligible under Section 606 and shall fail to resign after
written request therefor by the Company or any such Holder, or
(3) the Trustee shall become incapable
of acting or shall be adjudged a bankrupt or insolvent or a
receiver of the Trustee or of its property shall be appointed
or any public officer shall take charge or control of the
Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (i) the Company, by or pursuant to a Board
Resolution,
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may remove the Trustee with respect to all Securities or the
Securities of such series, or (ii) subject to Section 315(e) of the
Trust Indenture Act, any Holder of a Security who has been a bona fide
Holder of a Security of such series for at least six months may, on
behalf of himself and all others similarly situated, petition any
court of competent jurisdiction for the removal of the Trustee with
respect to all Securities of such series and the appointment of a
successor Trustee or Trustees.
(e) If the Trustee shall resign, be removed or
become incapable of acting, or if a vacancy shall occur in the office
of Trustee for any cause, with respect to the Securities of one or
more series, the Company, by or pursuant to a Board Resolution, shall
promptly appoint a successor Trustee or Trustees with respect to the
Securities of that or those series (it being understood that any such
successor Trustee may be appointed with respect to the Securities of
one or more or all of such series and that at any time there shall be
only one Trustee with respect to the Securities of any particular
series) and shall comply with the applicable requirements of Section
608. If, within one year after such resignation, removal or
incapability, or the occurrence of such vacancy, a successor Trustee
with respect to the Securities of any series shall be appointed by Act
of the Holders of a majority in principal amount of the Outstanding
Securities of such series delivered to the Company and the retiring
Trustee, the successor Trustee so appointed shall, forthwith upon its
acceptance of such appointment in accordance with the applicable
requirements of Section 608, become the successor Trustee with respect
to the Securities of such series and to that extent supersede the
successor Trustee appointed by the Company. If no successor Trustee
with respect to the Securities of any series shall have been so
appointed by the Company or the Holders of Securities and accepted
appointment in the manner required by Section 608, any Holder of a
Security who has been a bona fide Holder of a Security of such series
for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Trustee with respect to the Securities
of such series.
(f) The Company shall give notice of each
resignation and each removal of the Trustee with respect to the
Securities of any series and each appointment of a successor Trustee
with respect to the Securities of any series by mailing written notice
of such event by first-class mail, postage prepaid, to the Holders of
Registered Securities, if any, of such series as their names and
addresses appear in the Security Register and, if Securities of such
series are issued as Bearer Securities, by publishing notice of such
event once in an Authorized Newspaper in each Place of Payment located
outside the United States. Each notice shall include the name of the
successor Trustee with respect
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to the Securities of such series and the address of its Corporate
Trust Office.
Section 608. Acceptance of Appointment by Successor.
(a) Upon the appointment hereunder of any
successor Trustee with respect to all Securities, such successor
Trustee so appointed shall execute, acknowledge and deliver to the
Company and the retiring Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring
Trustee shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties hereunder of the retiring Trustee;
but, on the request of the Company or such successor Trustee, such
retiring Trustee, upon payment of its charges, shall execute and
deliver an instrument transferring to such successor Trustee all the
rights, powers and trusts of the retiring Trustee and, subject to
Section 1003, shall duly assign, transfer and deliver to such
successor Trustee all property and money held by such retiring Trustee
hereunder, subject nevertheless to its claim, if any, provided for in
Section 605.
(b) Upon the appointment hereunder of any
successor Trustee with respect to the Securities of one or more (but
not all) series, the Company, the retiring Trustee and such successor
Trustee shall execute and deliver an indenture supplemental hereto
wherein each successor Trustee shall accept such appointment and which
(1) shall contain such provisions as shall be necessary or desirable
to transfer and confirm to, and to vest in, such successor Trustee all
the rights, powers, trusts and duties of the retiring Trustee with
respect to the Securities of that or those series to which the
appointment of such successor Trustee relates, (2) if the retiring
Trustee is not retiring with respect to all Securities, shall contain
such provisions as shall be deemed necessary or desirable to confirm
that all the rights, powers, trusts and duties of the retiring Trustee
with respect to the Securities of that or those series as to which the
retiring Trustee is not retiring shall continue to be vested in the
retiring Trustee, and (3) shall add to or change any of the provisions
of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one Trustee,
it being understood that nothing herein or in such supplemental
indenture shall constitute such Trustees co-trustees of the same
trust, that each such Trustee shall be trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder
administered by any other such Trustee and that no Trustee shall be
responsible for any notice given to, or received by, or any act or
failure to act on the part of any other Trustee hereunder, and, upon
the execution and delivery of such supplemental indenture, the
resignation or removal of the retiring Trustee shall become effective
to the extent provided therein, such retiring Trustee shall have no
further responsibility
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for the exercise of rights and powers or for the performance of the
duties and obligations vested in the Trustee under this Indenture with
respect to the Securities of that or those series to which the
appointment of such successor Trustee relates other than as
hereinafter expressly set forth, and such successor Trustee, without
any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee with respect
to the Securities of that or those series to which the appointment of
such successor Trustee relates; but, on request of the Company or such
successor Trustee, such retiring Trustee, upon payment of its charges
with respect to the Securities of that or those series to which the
appointment of such successor relates and subject to Section 1003
shall duly assign, transfer and deliver to such successor Trustee, to
the extent contemplated by such supplemental indenture, the property
and money held by such retiring Trustee hereunder with respect to the
Securities of that or those series to which the appointment of such
successor Trustee relates.
(c) Upon request of any Person appointed
hereunder as a successor Trustee, the Company shall execute any and
all instruments for more fully and certainly vesting in and confirming
to such successor Trustee all such rights, powers and trusts referred
to in paragraph (a) or (b) of this Section 608, as the case may be.
(d) No Person shall accept its appointment
hereunder as a successor Trustee unless at the time of such acceptance
such successor Person shall be qualified and eligible under this
Article.
Section 609. Merger, Conversion, Consolidation or
Succession to Business.
Any Corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or any Corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any Corporation succeeding to all or substantially all of the
corporate trust business of the Trustee, shall be the successor of the Trustee
hereunder, without the execution or filing of any paper or any further act on
the part of any of the parties hereto. In case any Securities shall have been
authenticated but not delivered by the Trustee then in office, any successor by
merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.
Section 610. Appointment of Authenticating Agent.
The Trustee may appoint one or more Authenticating Agents
acceptable
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to the Company with respect to one or more series of Securities which shall be
authorized to act on behalf of the Trustee to authenticate Securities of that
or those series issued upon original issue, exchange, registration of transfer,
partial redemption or conversion thereof or pursuant to Section 306, and
Securities so authenticated shall be entitled to the benefits of this Indenture
and shall be valid and obligatory for all purposes as if authenticated by the
Trustee hereunder. Wherever reference is made in this Indenture to the
authentication and delivery of Securities by the Trustee or the Trustee's
certificate of authentication, such reference shall be deemed to include
authentication and delivery on behalf of the Trustee by an Authenticating Agent
and a certificate of authentication executed on behalf of the Trustee by an
Authenticating Agent.
Each Authenticating Agent shall be acceptable to the Company
and, except as provided in or pursuant to this Indenture, shall at all times be
a corporation that would be permitted by the Trust Indenture Act to act as
trustee under an indenture qualified under the Trust Indenture Act, is
authorized under applicable law and by its charter to act as an Authenticating
Agent and has a combined capital and surplus (computed in accordance with
Section 310(a)(2) of the Trust Indenture Act) of at least $50,000,000. If at
any time an Authenticating Agent shall cease to be eligible in accordance with
the provisions of this Section 610, it shall resign immediately in the manner
and with the effect specified in this Section 610.
Any Corporation into which an Authenticating Agent may be
merged or converted or with which it may be consolidated, or any Corporation
resulting from any merger, conversion or consolidation to which such
Authenticating Agent shall be a party, or any Corporation succeeding to the
corporate agency or corporate trust business of an Authenticating Agent, shall
be the successor of such Authenticating Agent hereunder, provided such
Corporation shall be otherwise eligible under this Section 610, without the
execution or filing of any paper or any further act on the part of the Trustee
or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving
written notice thereof to the Trustee and the Company. The Trustee may at any
time terminate the agency of an Authenticating Agent by giving written notice
thereof to such Authenticating Agent and the Company. Upon receiving such a
notice of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall (i) mail written
notice of such appointment by first-class mail, postage prepaid, to all Holders
of Registered Securities, if any, of the series with respect to which such
Authenticating Agent shall serve, as their names and addresses appear in the
Security Register, and (ii) if Securities of the series are issued as Bearer
Securities, publish notice of such
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appointment at least once in an Authorized Newspaper in the place where such
successor Authenticating Agent has its principal office if such office is
located outside the United States. Any successor Authenticating Agent, upon
acceptance of its appointment hereunder, shall become vested with all the
rights, powers and duties of its predecessor hereunder, with like effect as if
originally named as an Authenticating Agent. No successor Authenticating Agent
shall be appointed unless eligible under the provisions of this Section 610.
The Company agrees to pay each Authenticating Agent from time
to time reasonable compensation for its services under this Section 610. If
the Trustee makes such payments, it shall be entitled to be reimbursed for such
payments, subject to the provisions of Section 605.
The provisions of Sections 308, 602 and 603 shall be
applicable to each Authenticating Agent.
If an Authenticating Agent is appointed with respect to one
or more series of Securities pursuant to this Section 610, the Securities of
such series may have endorsed thereon, in addition to or in lieu of the
Trustee's certificate of authentication, an alternate certificate of
authentication in the following form:
This is one of the Securities of the series designated herein
referred to in the within-mentioned Indenture.
, As Trustee
-----------------
By
------------------------------
As Authenticating Agent
By
------------------------------
Authorized Signatory
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If all of the Securities of any series may not be originally
issued at one time, and if the Trustee does not have an office capable of
authenticating Securities upon original issuance located in a Place of Payment
where the Company wishes to have Securities of such series authenticated upon
original issuance, the Trustee, if so requested in writing (which writing need
not be accompanied by or contained in an Officers' Certificate by the Company),
shall appoint in accordance with this Section 610 an Authenticating Agent
having an office in a Place of Payment designated by the Company with respect
to such series of Securities.
ARTICLE SEVEN
HOLDER'S LISTS AND REPORTS BY TRUSTEE, AND COMPANY
Section 701. Company to Furnish Trustee Names and
Addresses of Holders.
In accordance with Section 312(a) of the Trust Indenture Act,
the Company shall furnish or cause to be furnished to the Trustee
(a) semi-annually with respect to Securities of
each series on October 1 and April 1 of each year or upon such other
dates as are set forth in or pursuant to the Board Resolution or
indenture supplemental hereto authorizing such series, a list, in each
case in such form as the Trustee may reasonably require, of the names
and addresses of Holders as of the applicable date, and
(b) at such other times as the Trustee may
request in writing, within 30 days after the receipt by the Company of
any such request, a list of similar form and content as of a date not
more than 15 days prior to the time such list is furnished,
provided, however, that so long as the Trustee is the Security Registrar no
such list shall be required to be furnished.
Section 702. Preservation of Information; Communications
to Holders.
The Trustee shall comply with the obligations imposed upon it
pursuant to Section 312 of the Trust Indenture Act.
Every Holder of Securities or Coupons, by receiving and
holding the same, agrees with the Company and the Trustee that neither the
Company, the Trustee, any
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Paying Agent or any Security Registrar shall be held accountable by reason of
the disclosure of any such information as to the names and addresses of the
Holders of Securities in accordance with Section 312 of the Trust Indenture
Act, regardless of the source from which such information was derived, and that
the Trustee shall not be held accountable by reason of mailing any material
pursuant to a request made under Section 312(b) of the Trust Indenture Act.
Section 703. Reports by Trustee.
(a) Within 60 days after September 15 of each year
commencing with the first September 15 following the first issuance of
Securities pursuant to Section 301, if required by Section 313(a) of the Trust
Indenture Act, the Trustee shall transmit, pursuant to Section 313(c) of the
Trust Indenture Act, a brief report dated as of such September 15 with respect
to any of the events specified in said Section 313(a) which may have occurred
since the later of the immediately preceding September 15 and the date of this
Indenture.
(b) The Trustee shall transmit the reports required by
Section 313(b) of the Trust Indenture Act at the times specified therein.
(c) Reports pursuant to this Section shall be transmitted
in the manner and to the Persons required by Sections 313(c) and 313(d) of the
Trust Indenture Act.
Section 704. Reports by Company.
The Company, pursuant to Section 314(a) of the Trust Indenture
Act, shall:
(1) file with the Trustee, within 15 days after
the Company is required to file the same with the Commission, copies
of the annual reports and of the information, documents and other
reports (or copies of such portions of any of the foregoing as the
Commission may from time to time by rules and regulations prescribe)
which the Company may be required to file with the Commission pursuant
to Section 13 or Section 15(d) of the Securities Exchange Act of 1934;
or, if the Company is not required to file information, documents or
reports pursuant to either of said Sections, then it shall file with
the Trustee and the Commission, in accordance with rules and
regulations prescribed from time to time by the Commission, such of
the supplementary and periodic information, documents and reports
which may be required pursuant to Section 13 of the Securities
Exchange Act of 1934 in respect of a security listed and registered on
a national securities exchange as may be prescribed from time to time
in such rules and regulations;
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(2) file with the Trustee and the Commission, in
accordance with rules and regulations prescribed from time to time by
the Commission, such additional information, documents and reports
with respect to compliance by the Company, as the case may be, with
the conditions and covenants of this Indenture as may be required from
time to time by such rules and regulations; and
(3) transmit within 30 days after the filing
thereof with the Trustee, in the manner and to the extent provided in
Section 313(c) of the Trust Indenture Act, such summaries of any
information, documents and reports required to be filed by the Company
pursuant to paragraphs (1) and (2) of this Section 704 as may be
required by rules and regulations prescribed from time to time by the
Commission.
ARTICLE EIGHT
CONSOLIDATION, MERGER AND SALES
Section 801. Company May Consolidate, Etc., Only on
Certain Terms.
Nothing contained in this Indenture or in any of the
Securities shall prevent any consolidation or merger of the Company with or
into any other Person or Persons (whether or not affiliated with the Company),
or successive consolidations or mergers in which the Company or its successor
or successors shall be a party or parties, or shall prevent any conveyance,
transfer or lease of the property of the Company as an entirety or
substantially as an entirety, to any other Person (whether or not affiliated
with the Company); provided, however, that:
(1) in case the Company shall consolidate with or
merge into another Person or convey, transfer or lease its properties
and assets substantially as an entirety to any Person, the entity
formed by such consolidation or into which the Company is merged or
the Person which acquires by conveyance or transfer, or which leases,
the properties and assets of the Company substantially as an entirety
shall be a Corporation organized and existing under the laws of the
United States of America, any state thereof or the District of
Columbia and shall expressly assume, by an indenture (or indentures,
if at such time there is more than one Trustee) supplemental hereto,
executed by the successor Person and delivered to the Trustee, in form
satisfactory to the Trustee, the due and punctual payment of the
principal of, any premium and interest on and any Additional Amounts
with respect to all the Securities and the performance of every other
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covenant of this Indenture on the part of the Company to be performed
or observed;
(2) immediately after giving effect to such
transaction, no event which, after notice or lapse of time, would
become an Event of Default, shall have occurred and be continuing;
(3) either the Company or the successor Person shall
have delivered to the Trustee an Officers' Certificate and an Opinion
of Counsel, stating that such consolidation, merger, conveyance,
transfer or lease and such supplemental indenture comply with this
Article and that all conditions precedent herein provided for relating
to such transaction have been complied with.
Section 802. Successor Person Substituted for Company.
Upon any consolidation or merger or any conveyance, transfer
or lease of the properties and assets of the Company substantially as an
entirety to any Person in accordance with Section 801, the successor Person
formed by such consolidation or into which the Company is merged or to which
such conveyance, transfer or lease is made shall succeed to, and be substituted
for, and may exercise every right and power of, the Company under this
Indenture with the same effect as if such successor Person had been named as
the Company herein; and thereafter, except in the case of a lease to another
Person, the predecessor Person shall be released from all obligations and
covenants under this Indenture, the Securities and the Coupons.
ARTICLE NINE
SUPPLEMENTAL INDENTURES
Section 901. Supplemental Indentures without Consent of
Holders.
Without the consent of any Holders of Securities or Coupons,
the Company (when authorized by or pursuant to a Board Resolution) and the
Trustee, at any time and from time to time, may enter into one or more
indentures supplemental hereto, in form satisfactory to the Trustee, for any of
the following purposes:
(1) to evidence the succession of another Person
to the Company, and the assumption by any such successor of the
covenants of the Company herein and in the Securities; or
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(2) to add to the covenants of the Company for
the benefit of the Holders of all or any series of Securities (as
shall be specified in such supplemental indenture or indentures) or to
surrender any right or power herein conferred upon the Company; or
(3) to add to or change any of the provisions of
this Indenture to provide that Bearer Securities may be registrable as
to principal, to change or eliminate any restrictions on the payment
of principal of, any premium or interest on or any Additional Amounts
with respect to Securities, to permit Registered Securities to be
exchanged for Bearer Securities, to permit Bearer Securities to be
exchanged for Bearer Securities of other authorized denominations or
to permit or facilitate the issuance of Securities in uncertificated
form, provided any such action shall not adversely affect the
interests of the Holders of Securities of any series or any Coupons
appertaining thereto in any material respect; or
(4) to establish the form or terms of Securities
of any series and any Coupons appertaining thereto as permitted by
Sections 201 and 301; or
(5) to evidence and provide for the acceptance of
appointment hereunder by a successor Trustee with respect to the
Securities of one or more series and to add to or change any of the
provisions of this Indenture as shall be necessary to provide for or
facilitate the administration of the trusts hereunder by more than one
Trustee, pursuant to the requirements of Section 608; or
(6) to cure any ambiguity or to correct or
supplement any provision herein which may be defective or inconsistent
with any other provision herein, or to make any other provisions with
respect to matters or questions arising under this Indenture which
shall not adversely affect the interests of the Holders of Securities
of any series or any Coupons appertaining thereto in any material
respect; or
(7) to add to, delete from or revise the
conditions, limitations and restrictions on the authorized amount,
terms or purposes of issue, authentication and delivery of Securities,
as herein set forth; or
(8) to add any additional Events of Default with
respect to all or any series of Securities (as shall be specified in
such supplemental indenture); or
(9) to supplement any of the provisions of this
Indenture to such extent as shall be necessary to permit or facilitate
the defeasance and discharge of any series of Securities pursuant to
Article Four; provided that any such action shall not adversely affect
the interests of any Holder of a Security of such series
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and any Coupons appertaining thereto or any other Security or Coupon
in any material respect; or
(10) to secure the Securities pursuant to Section
1006 or otherwise;
(11) to make provision with respect to the
conversion rights of Holders of Convertible Securities pursuant to the
requirements of Section 1706; or
(12) to amend or supplement any provision contained
herein or in any supplemental indenture, provided that no such
amendment or supplement shall materially adversely affect the
interests of the Holders of any Securities then Outstanding.
Section 902. Supplemental Indentures with Consent of
Holders.
With the consent of the Holders of not less than 66-2/3% in
principal amount of the Outstanding Securities of each series affected by such
supplemental indenture, by Act of said Holders delivered to the Company and the
Trustee, the Company (when authorized by or pursuant to a Company's Board
Resolution), and the Trustee may enter into an Indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this indenture or of
modifying in any manner the rights of the Holders of Securities of such series
under this Indenture; provided, however, that no such supplemental indenture,
without the consent of the Holder of each Outstanding Security affected
thereby, shall
(1) change the Stated Maturity of the principal of,
or any premium or installment of interest on or any Additional Amounts
with respect to, any Security, or reduce the principal amount thereof
or the rate of interest thereon or any Additional Amounts with respect
thereto, or any premium payable upon the redemption thereof or
otherwise, or change the obligation of the Company to pay Additional
Amounts pursuant to Section 1004 (except as contemplated by Section
801(1) and permitted by Section 901(1)), or reduce the amount of the
principal of an Original Issue Discount Security that would be due and
payable upon a declaration of acceleration of the Maturity thereof
pursuant to Section 502 or the amount thereof provable in bankruptcy
pursuant to Section 504, or adversely affect the right of repayment at
the option of any Holder as contemplated by Article Thirteen, or
change the Place of Payment, Currency in which the principal of, any
premium or interest on, or any Additional Amounts with respect to any
Security is payable, or impair the right to institute suit for the
enforcement of any such payment on or after the Stated Maturity
thereof (or, in the case of
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redemption, on or after the Redemption Date or, in the case of
repayment at the option of the Holder, on or after the date for
repayment), or
(2) reduce the percentage in principal amount of the
Outstanding Securities of any series, the consent of whose Holders is
required for any such supplemental indenture, or the consent of whose
Holders is required for any waiver (of compliance with certain
provisions of this Indenture or certain defaults hereunder and their
consequences) provided for in this Indenture, or reduce the
requirements of Section 1504 for quorum or voting,
(3) modify the provisions of this Indenture with
respect to the subordination of the Securities in a manner adverse to
the Holders,
(4) adversely affect the right to convert any
Convertible Security, or
(5) modify any of the provisions of this Section
902, or Section 513 or Section 1008, except to increase any such
percentage or to provide that certain other provisions of this
Indenture cannot be modified or waived without the consent of the
Holder of each Outstanding Security affected thereby.
A supplemental indenture which changes or eliminates any
covenant or other provision of this Indenture which shall have been included
expressly and solely for the benefit of one or more particular series of
Securities, or which modifies the rights of the Holders of Securities of such
series with respect to such covenant or other provision, shall be deemed not to
affect the rights under this Indenture of the Holders of Securities of any
other series.
It shall not be necessary for any Act of Holders of Securities
under this Section 902 to approve the particular form of any proposed
supplemental indenture, but it shall be sufficient if such Act shall approve
the substance thereof.
Section 903. Execution of Supplemental Indentures.
As a condition to executing, or accepting the additional
trusts created by, any supplemental indenture permitted by this Article or the
modifications thereby of the trust created by this Indenture, the Trustee shall
be entitled to receive, and (subject to Article Six hereof) shall be fully
protected in relying upon, an Opinion of Counsel stating that the execution of
such supplemental indenture is authorized or permitted by this Indenture. The
Trustee may, but shall not be obligated to, enter into any such supplemental
indenture which affects the Trustee's own rights, duties or immunities under
this Indenture or otherwise.
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Section 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this
Article, this Indenture shall be modified in accordance therewith, and such
supplemental indenture shall form a part of this Indenture for all purposes;
and every Holder of a Security theretofore or thereafter authenticated and
delivered hereunder and of any Coupon appertaining thereto shall be bound
thereby.
Section 905. Reference in Securities to Supplemental
Indentures.
Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may, and shall
if required by the Trustee, bear a notation in form approved by the Trustee as
to any matter provided for in such supplemental indenture. If the Company
shall so determine, new Securities of any series so modified as to conform, in
the opinion of the Trustee and the Company, to any such supplemental indenture
may be prepared and executed by the Company and authenticated and delivered by
the Trustee in exchange for Outstanding Securities of such series.
Section 906. Subordination Unimpaired.
No supplemental indenture entered into under this Article
shall modify, directly or indirectly, the provisions of Article Sixteen or the
definition of Senior Indebtedness in Section 101 in any manner that might alter
or impair the subordination of the Securities with respect to Senior
Indebtedness then outstanding, unless each holder of such Senior Indebtedness
has consented thereto in writing.
ARTICLE TEN
COVENANTS
Section 1001. Payment of Principal and any Premium,
Interest and Additional Amounts.
The Company covenants and agrees for the benefit of the
Holders of the Securities of each series that it will duly and punctually pay
the principal of, any premium and interest on and any Additional Amounts with
respect to the Securities of such series in accordance with the terms thereof,
any Coupons appertaining thereto and this Indenture. Any interest due on any
Bearer Security on or before the Maturity thereof, and any Additional Amounts
payable with respect to such interest, shall be payable only
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upon presentation and surrender of the Coupons appertaining thereto for such
interest as they severally mature.
Section 1002. Maintenance of Office or Agency.
The Company shall maintain in each Place of Payment for any
series of Securities an Office or Agency where Securities of such series (but
not Bearer Securities, except as otherwise provided below, unless such Place of
Payment is located outside the United States) may be presented or surrendered
for payment, where Securities of such series may be surrendered for
registration of transfer, exchange or, if applicable, conversion and where
notices and demands to or upon the Company in respect of the Securities of such
series relating thereto and this Indenture may be served. If Securities of a
series are issuable as Bearer Securities, the Company shall maintain, subject
to any laws or regulations applicable thereto, an Office or Agency in a Place
of Payment for such series which is located outside the United States where
Securities of such series and any Coupons appertaining thereto may be presented
and surrendered for payment; provided, however, that if the Securities of such
series are listed on The Stock Exchange of the United Kingdom and the Republic
of Ireland or the Luxembourg Stock Exchange or any other stock exchange located
outside the United States and such stock exchange shall so require, the Company
shall maintain a Paying Agent in London, Luxembourg or any other required city
located outside the United States, as the case may be, so long as the
Securities of such series are listed on such exchange. The Company will give
prompt written notice to the Trustee of the location, and any change in the
location, of such Office or Agency. If at any time the Company shall fail to
maintain any such required Office or Agency or shall fail to furnish the
Trustee with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the Corporate Trust Office of the Trustee,
except that Bearer Securities of such series and any Coupons appertaining
thereto may be presented and surrendered for payment at the place specified for
the purpose with respect to such Securities as provided in or pursuant to this
Indenture, and the Company hereby appoints the Trustee as its agent to receive
all such presentations, surrenders, notices and demands.
Except as otherwise provided in or pursuant to this Indenture,
no payment of principal, premium, interest or Additional Amounts with respect
to Bearer Securities shall be made at any Office or Agency in the United States
or by check mailed to any address in the United States or by transfer to an
account maintained with a bank located in the United States; provided, however,
if amounts owing with respect to any Bearer Securities shall be payable in
Dollars, payment of principal of, any premium or interest on and any Additional
Amounts with respect to any such Security may be made at the Corporate Trust
Office of the Trustee or any Office or Agency designated by the Company in The
City of New York, if (but only if) payment of the full amount of such
principal, premium, interest or Additional Amounts at all offices outside the
United States
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maintained for such purpose by the Company in accordance with this Indenture is
illegal or effectively precluded by exchange controls or other similar
restrictions.
The Company may also from time to time designate one or more
other Offices or Agencies where the Securities of one or more series may be
presented or surrendered for any or all such purposes and may from time to time
rescind such designations; provided, however, that no such designation or
rescission shall in any manner relieve the Company of its obligation to
maintain an Office or Agency in each Place of Payment for Securities of any
series for such purposes. The Company shall give prompt written notice to the
Trustee of any such designation or rescission and of any change in the location
of any such other Office or Agency. Unless otherwise provided in or pursuant
to this Indenture, the Company hereby designates as the Place of Payment for
each series The City of New York, and initially appoints the Office or Agency
of the Corporate Trust Office of the Trustee for such purpose. Pursuant to
Section 301(9) of this Indenture, the Company may subsequently appoint a place
or places in The City of New York where such Securities may be payable.
Section 1003. Money for Securities Payments to Be Held in
Trust.
If the Company shall at any time act as its own Paying Agent
with respect to any series of Securities, it shall, on or before each due date
of the principal of, any premium or interest on or Additional Amounts with
respect to any of the Securities of such series, segregate and hold in trust
for the benefit of the Persons entitled thereto a sum of money sufficient to
pay the principal or any premium, interest or Additional Amounts so becoming
due until such sums shall be paid to such Persons or otherwise disposed of as
herein provided, and shall promptly notify the Trustee of its action or failure
so to act.
Whenever the Company shall have one or more Paying Agents for
any series of Securities, it shall, on or prior to each due date of the
principal of, any premium or interest on or any Additional Amounts with respect
to any Securities of such series, deposit with any Paying Agent a sum of money
sufficient to pay the principal or any premium, interest or Additional Amounts
so becoming due, such sum to be held in trust for the benefit of the Persons
entitled thereto, and (unless such Paying Agent is the Trustee) the Company
will promptly notify the Trustee of its action or failure so to act.
The Company shall cause each Paying Agent for any series of
Securities other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent shall:
(1) hold all sums held by it for the payment of
the principal of,
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any premium or interest on or any Additional Amounts with respect to
Securities of such series in trust for the benefit of the Persons
entitled thereto until such sums shall be paid to such Persons or
otherwise disposed of as provided in or pursuant to this Indenture;
(2) give the Trustee notice of any default by the
Company (or any other obligor upon the Securities of such series) in
the making of any payment of principal, any premium or interest on or
any Additional Amounts with respect to the Securities of such series;
and
(3) at any time during the continuance of any
such default, upon the written request of the Trustee, forthwith pay
to the Trustee all sums so held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held
in trust by the Company or such Paying Agent, such sums to be held by the
Trustee upon the same terms as those upon which such sums were held by the
Company or such Paying Agent; and, upon such payment by any Paying Agent to the
Trustee, such Paying Agent shall be released from all further liability with
respect to such money.
Except as otherwise provided herein or pursuant hereto, any
money deposited with the Trustee or any Paying Agent, or then held by the
Company, in trust for the payment of the principal of, any premium or interest
on or any Additional Amounts with respect to any Security of any series and
remaining unclaimed for two years after such principal or any such premium or
interest or any such Additional Amounts shall have become due and payable shall
be paid to the Company on Company Request, or (if then held by the Company)
shall be discharged from such trust; and the Holder of such Security or any
Coupon appertaining thereto shall thereafter, as an unsecured general creditor,
look only to the Company for payment thereof, and all liability of the Trustee
or such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Company cause to be published once, in an Authorized
Newspaper in each Place of Payment for such series or to be mailed to Holders
of Registered Securities of such series, or both, 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 nor shall it be
later than two years after such principal and any premium or interest or
Additional Amounts shall have become due and payable, any unclaimed balance of
such money then remaining will be repaid to the Company.
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Section 1004. Additional Amounts.
If any Securities of a series provide for the payment of
Additional Amounts, the Company agrees to pay to the Holder of any such
Security or any Coupon appertaining thereto Additional Amounts as provided
therein. Whenever in this Indenture there is mentioned, in any context, the
payment of the principal of or any premium or interest on, or in respect of,
any Security of any series or any Coupon or the net proceeds received on the
sale or exchange of any Security of any series, such mention shall be deemed to
include mention of the payment of Additional Amounts provided by the terms of
such series established hereby or pursuant hereto to the extent that, in such
context, Additional Amounts are, were or would be payable in respect thereof
pursuant to such terms, and express mention of the payment of Additional
Amounts (if applicable) in any provision hereof shall not be construed as
excluding Additional Amounts in those provisions hereof where such express
mention is not made.
Except as otherwise provided in or pursuant to this Indenture,
if the Securities of a series provide for the payment of Additional Amounts, at
least 10 days prior to the first Interest Payment Date with respect to such
series of Securities (or if the Securities of such series shall not bear
interest prior to Maturity, the first day on which a payment of principal is
made), and at least 10 days prior to each date of payment of principal or
interest if there has been any change with respect to the matters set forth in
the below-mentioned Officers' Certificate, the Company shall furnish to the
Trustee and the principal Paying Agent or Paying Agents, if other than the
Trustee, an Officers' Certificate instructing the Trustee and such Paying Agent
or Paying Agents whether such payment of principal of or interest on the
Securities of such series shall be made to Holders of Securities of such series
or the Coupons appertaining thereto who are United States Aliens without
withholding for or on account of any tax, assessment or other governmental
charge described in the Securities of such series. If any such withholding
shall be required, then such Officers' Certificate shall specify by country the
amount, if any, required to be withheld on such payments to such Holders of
Securities or Coupons, and the Company agrees to pay to the Trustee or such
Paying Agent the Additional Amounts required by the terms of such Securities.
The Company covenants to indemnify the Trustee and any Paying Agent for, and to
hold them harmless against, any loss, liability or expense (including
reasonable fees and expenses) reasonably incurred without negligence or bad
faith on their part arising out of or in connection with actions taken or
omitted by any of them in reliance on any Officers' Certificate furnished
pursuant to this Section 1004.
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Section 1005. Limitation Upon Disposition of Voting Stock
of Significant Subsidiaries.
So long as any of the Securities shall be Outstanding, the
Company:
(a) will not, nor will it permit any Subsidiary to,
sell, assign, transfer or otherwise dispose of any shares of,
securities convertible into or options, warrants or rights to
subscribe for or purchase shares of, Voting Stock of a Significant
Subsidiary, and will not permit a Significant Subsidiary to issue any
shares of, or securities convertible into or options, warrants or
rights to subscribe for or purchase shares of, such Voting Stock if,
in each case, after giving effect to any such transaction and to the
issuance of the maximum number of shares of Voting Stock of such
Significant Subsidiary issuable upon the exercise of all such
convertible securities, options, warrants or rights, such Significant
Subsidiary would cease to be a Controlled Subsidiary, or
(b) will not permit a Significant Subsidiary to
(i) merge or consolidate with or into any
other corporation, unless the surviving corporation is the
Company or is, or upon consummation of the merger or
consolidation will become, a Controlled Subsidiary; or
(ii) lease, sell or transfer all or
substantially all of its properties and assets to any
corporation or other Person, except to the Company or to a
Controlled Subsidiary or a Person that, upon such lease, sale
or transfer, will become a Controlled Subsidiary.
Notwithstanding the foregoing, any such sale, assignment or
transfer of securities, any such merger or consolidation or any such lease,
sale or transfer of properties and assets shall not be prohibited if required
(i) by any law or any rule, regulation or order of any governmental agency or
authority or (ii) as a condition imposed by any law or any rule, regulation or
order of any governmental agency or authority to the acquisition by the
Company, directly or indirectly, through purchase of stock or assets, merger,
consolidation or otherwise, of any Person, provided that, after giving effect
to such disposition and acquisition, (A) such Person will be a Controlled
Subsidiary, and (B) the Consolidated Assets of the Company will be at least
equal to the Consolidated Assets of the Company prior thereto.
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Section 1006. Limitation on Creation of Liens.
So long as any of the Securities shall be outstanding, the
Company will not, nor will it permit any Subsidiary to, create, assume, incur
or suffer to be created, assumed or incurred or to exist any pledge,
encumbrance or lien, as security for indebtedness for borrowed money, upon any
shares of, or securities convertible into or options, warrants or rights to
subscribe for or purchase shares of, Voting Stock of a Significant Subsidiary,
directly or indirectly, without making effective provision whereby the
Securities of all series shall be equally and ratably secured with any and all
such indebtedness if, treating such pledge, encumbrance or lien as a transfer
of the shares of, or securities convertible into or options, warrants or rights
to subscribe for or purchase shares of, Voting Stock subject thereto to the
secured party and to the issuance of the maximum number of shares of Voting
Stock of such Significant Subsidiary issuable upon the exercise of all such
convertible securities, options, warrants or rights, such Significant
Subsidiary would not continue to be a Controlled Subsidiary.
Section 1007. Corporate Existence.
Subject to Article Eight, the Company will do or cause to be
done all things necessary to preserve and keep in full force and effect its
corporate existence and the corporate existence of each Significant Subsidiary
and its rights (charter and statutory) and franchises and those of each such
Significant Subsidiary; provided, however, that neither the Company nor any
Significant Subsidiary shall be required to preserve any such right or
franchise if the Company or such Significant Subsidiary, as the case may be,
shall determine that the preservation thereof is no longer desirable in the
conduct of its business and that the loss thereof is not disadvantageous in any
material respect to the Holders.
Section 1008. Waiver of Certain Covenants.
The Company may omit in any particular instance to comply with
any term, provision or condition set forth in Section 1005, 1006 or 1007 with
respect to the Securities of any series if before the time for such compliance
the Holders of at least a majority in principal amount of the Outstanding
Securities of such series, by Act of such Holders, either shall waive such
compliance in such instance or generally shall have waived compliance with such
term, provision or condition, but no such waiver shall extend to or affect such
term, provision or condition except to the extent so expressly waived, and,
until such waiver shall become effective, the obligations of the Company and
the duties of the Trustee in respect of any such term, provision or condition
shall remain in full force and effect.
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Section 1009. Company Statement as to Compliance; Notice of
Certain Defaults.
(a) The Company shall deliver to the Trustee, within 120
days after the end of each fiscal year, a written statement (which need not be
contained in or accompanied by an Officers' Certificate) signed by the
principal executive officer, the principal financial officer or the principal
accounting officer of the Company, stating that
(1) a review of the activities of the Company
during such year and of its performance under this Indenture has been
made under his or her supervision, and
(2) to the best of his or her knowledge, based on
such review, (a) the Company has complied with all the conditions and
covenants imposed on it under this Indenture throughout such year, or,
if there has been a default in the fulfillment of any such condition
or covenant, specifying each such default known to him or her and the
nature and status thereof, and (b) no event has occurred and is
continuing which is, or after notice or lapse of time or both would
become, an Event of Default, or, if such an event has occurred and is
continuing, specifying each such event known to him and the nature and
status thereof.
(b) The Company shall deliver to the Trustee, within five
days after the occurrence thereof, written notice of any event which after
notice or lapse of time or both would become an Event of Default pursuant to
clause (4) of Section 501.
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
Section 1101. Applicability of Article.
Redemption of Securities of any series at the option of the
Company as permitted or required by the terms of such Securities shall be made
in accordance with the terms of such Securities and (except as otherwise
provided herein or pursuant hereto) this Article.
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Section 1102. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be
evidenced by or pursuant to a Board Resolution. In case of any redemption at
the election of the Company of the Securities of any series, with the same
issue date, interest rate, Stated Maturity and other terms, the Company shall,
at least 60 days prior to the Redemption Date fixed by the Company (unless a
shorter notice shall be satisfactory to the Trustee), notify the Trustee of
such Redemption Date and of the principal amount of Securities of such series
to be redeemed.
Section 1103. Selection by Trustee of Securities to be
Redeemed.
If less than all the Securities of any series with the same
issue date, interest rate, Stated Maturity and other terms are to be redeemed,
the particular Securities to be redeemed shall be selected not more than 60
days prior to the Redemption Date by the Trustee from the Outstanding
Securities of such series not previously called for redemption, by such method
as the Trustee shall deem fair and appropriate and which may provide for the
selection for redemption of portions of the principal amount of Registered
Securities of such series; provided, however, that no such partial redemption
shall reduce the portion of the principal amount of a Registered Security of
such series not redeemed to less than the minimum denomination for a Security
of such series established herein or pursuant hereto.
If any Convertible Security selected for partial redemption is
converted in part before termination of the conversion right with respect to
the portion of the Security so selected, the converted portion of such Security
shall be deemed (so far as may be) to be the portion selected for redemption.
Securities which have been converted during a selection of Securities to be
redeemed shall be treated by the Trustee as Outstanding for the purpose of such
selection.
The Trustee shall promptly notify the Company and the Security
Registrar (if other than itself) in writing of the Securities selected for
redemption and, in the case of any Securities selected for partial redemption,
the principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Securities
shall relate, in the case of any Securities redeemed or to be redeemed only in
part, to the portion of the principal of such Securities which has been or is
to be redeemed.
Section 1104. Notice of Redemption.
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Notice of redemption shall be given in the manner provided in
Section 106, not less than 30 nor more than 60 days prior to the Redemption
Date, unless a shorter period is specified in the Securities to be redeemed, to
the Holders of Securities to be redeemed. Failure to give notice by mailing in
the manner herein provided to the Holder of any Registered Securities
designated for redemption as a whole or in part, or any defect in the notice to
any such Holder, shall not affect the validity of the proceedings for the
redemption of any other Securities or portion thereof.
Any notice that is mailed to the Holder of any Registered
Securities in the manner herein provided shall be conclusively presumed to have
been duly given, whether or not such Holder receives the notice.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all Outstanding Securities of
any series are to be redeemed, the identification (and, in the case of
partial redemption, the principal amount) of the particular Security
or Securities to be redeemed,
(4) in case any Security is to be redeemed in
part only, the notice which relates to such Security shall state that
on and after the Redemption Date, upon surrender of such Security, the
Holder of such Security will receive, without charge, a new Security
or Securities of authorized denominations for the principal amount
thereof remaining unredeemed,
(5) that, on the Redemption Date, the Redemption
Price shall become due and payable upon each such Security or portion
thereof to be redeemed, and, if applicable, that interest thereon
shall cease to accrue on and after said date,
(6) in the case of Convertible Securities, the
Conversion Price then in effect, the date on which the right to
convert the principal amount of the Securities or the portions thereof
to be redeemed will terminate and the place or places where such
Securities may be surrendered for conversion,
(7) the place or places where such Securities,
together (in the case of Bearer Securities) with all Coupons
appertaining thereto, if any, maturing after the Redemption Date, are
to be surrendered for payment of the Redemption Price and any accrued
interest and Additional Amounts pertaining thereto,
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(8) that the redemption is for a sinking fund, if
such is the case,
(9) that, unless otherwise specified in such
notice, Bearer Securities of any series, if any, surrendered for
redemption must be accompanied by all Coupons maturing subsequent to
the date fixed for redemption or the amount of any such missing Coupon
or Coupons will be deducted from the Redemption Price, unless security
or indemnity satisfactory to the Company, the Trustee and any Paying
Agent is furnished,
(10) if Bearer Securities of any series are to be
redeemed and any Registered Securities of such series are not to be
redeemed, and if such Bearer Securities may be exchanged for
Registered Securities not subject to redemption on the Redemption Date
pursuant to Section 305 or otherwise, the last date, as determined by
the Company, on which such exchanges may be made, and
(11) the CUSIP number or the Euro-clear or the CEDEL
reference numbers of such Securities, if any (or any other numbers
used by a Depository to identify such Securities).
A notice of redemption published as contemplated by Section
106 need not identify particular Registered Securities to be redeemed.
Notice of redemption of Securities to be redeemed at the
election of the Company shall be given by the Company or, at the Company's
request, by the Trustee in the name and at the expense of the Company.
Section 1105. Deposit of Redemption Price.
On or prior to any Redemption Date, the Company shall deposit
with the Trustee or with a Paying Agent (or, if the Company is acting as its
own Paying Agent, segregate and hold in trust as provided in Section 1003) an
amount of money sufficient to pay the Redemption Price of, and (except if the
Redemption Date shall be an Interest Payment Date) any accrued interest on and
Additional Amounts with respect thereto, all the Securities or portions thereof
which are to be redeemed on that date.
If any Convertible Security or portion thereof called for
redemption is converted pursuant to Article Seventeen, any money deposited with
the Trustee or so segregated and held in trust for the redemption of such
Security or portion thereof shall (subject to any right of the Holder of the
Security on a Regular Record Date preceding such conversion to receive
interest) be paid to the Company upon Company Request or, if then held by the
Company, shall be discharged from such trust.
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Section 1106. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the
Securities so to be redeemed shall, on the Redemption Date, become due and
payable at the Redemption Price therein specified, and from and after such date
(unless the Company shall default in the payment of the Redemption Price and
accrued interest) such Securities shall cease to bear interest and the Coupons
for such interest appertaining to any Bearer Securities so to be redeemed,
except to the extent provided below, shall be void. Upon surrender of any such
Security for redemption in accordance with said notice, together with all
Coupons, if any, appertaining thereto maturing after the Redemption Date, such
Security shall be paid by the Company at the Redemption Price, together with
any accrued interest and Additional Amounts to the Redemption Date; provided,
however, that installments of interest on Bearer Securities whose Stated
Maturity is on or prior to the Redemption Date shall be payable only upon
presentation and surrender of Coupons for such interest (at an Office or Agency
located outside the United States except as otherwise provided in Section
1002), and provided, further, that installments of interest on Registered
Securities whose Stated Maturity is on or prior to the Redemption Date shall be
payable to the Holders of such Securities, or one or more Predecessor
Securities, registered as such at the close of business on the Regular Record
Dates therefor according to their terms and the provisions of Section 307.
If any Bearer Security surrendered for redemption shall not be
accompanied by all appurtenant Coupons maturing after the Redemption Date, such
Security may be paid after deducting from the Redemption Price an amount equal
to the face amount of all such missing Coupons, or the surrender of such
missing Coupon or Coupons may be waived by the Company and the Trustee if there
be furnished to them such security or indemnity as they may require to save
each of them and any Paying Agent harmless. If thereafter the Holder of such
Security shall surrender to the Trustee or any Paying Agent any such missing
Coupon in respect of which a deduction shall have been made from the Redemption
Price, such Holder shall be entitled to receive the amount so deducted;
provided, however, that any interest or Additional Amounts represented by
Coupons shall be payable only upon presentation and surrender of those Coupons
at an Office or Agency for such Security located outside of the United States
except as otherwise provided in Section 1002.
If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal and any premium, until
paid, shall bear interest from the Redemption Date at the rate prescribed
therefor in the Security.
Section 1107. Securities Redeemed in Part.
Any Registered Security which is to be redeemed only in part
shall be
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surrendered at any Office or Agency for such Security (with, if the Company or
the Trustee so requires, due endorsement by, or a written instrument of
transfer in form satisfactory to the Company and the Trustee duly executed by,
the Holder thereof or his attorney duly authorized in writing) and the Company
shall execute and the Trustee shall authenticate and deliver to the Holder of
such Security without service charge, a new Registered Security or Securities
of the same series, containing identical terms and provisions, of any
authorized denomination as requested by such Holder in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of
the Security so surrendered. If a Security in global form is so surrendered,
the Company shall execute, and the Trustee shall authenticate and deliver to
the U.S. Depository or other Depository for such Security in global form as
shall be specified in the Company Order with respect thereto to the Trustee,
without service charge, a new Security in global form in a denomination equal
to and in exchange for the unredeemed portion of the principal of the Security
in global form so surrendered.
Section 1108. Conversion Arrangements on Call for
Redemption.
Notwithstanding anything to the contrary contained in this Indenture,
in connection with any redemption of Convertible Securities of any series, the
Company, by an agreement with one or more investment bankers or other
purchasers, may arrange for such purchasers to purchase all such Convertible
Securities called for redemption (the "Called Securities") which are either (i)
surrendered for redemption or (ii) not duly surrendered for redemption or
conversion prior to the close of business on the Redemption Date, and to
convert the same into shares of Common Stock, by the purchasers' depositing
with the Trustee (acting as Paying Agent with respect to the deposit of such
amount and as conversion agent with respect to the conversion of such Called
Securities), in trust for the Holders of the Called Securities, on or prior to
the Redemption Date in the manner agreed to by the Company and such purchasers,
an amount sufficient to pay the Redemption Price, payable by the Company on
redemption of such Called Securities. In connection with any such arrangement
for purchase and conversion, the Trustee as Paying Agent shall pay on or after
the Redemption Date such amounts so deposited by the purchasers in exchange for
Called Securities surrendered for redemption prior to the close of business on
the Redemption Date and for all Called Securities surrendered after such
Redemption Date. Notwithstanding anything to the contrary contained in this
Article Eleven, the obligation of the Company to pay the Redemption Price of
such Called Securities shall be satisfied and discharged to the extent such
amount is so paid by such purchasers, provided, however, that nothing in this
Section 1108 shall in any way relieve the Company of the obligation to pay such
Redemption Price on all Called Securities to the extent such amount is not so
paid by said purchasers. For all purposes of this Indenture, any Called
Securities surrendered by the Holders for redemption, and any Called Securities
not duly surrendered for redemption or conversion prior to the close of
business on the Redemption Date, shall
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be deemed acquired by such purchasers from such Holders and surrendered by such
purchasers for conversion and shall in all respects be deemed to have been
converted, all as of immediately prior to the close of business on the
Redemption Date, subject to the deposit by the purchasers of the above amount
as aforesaid. Nothing in this Section 1108 shall in any way limit the right of
any Holder of a Security to convert his Security pursuant to the terms of this
Indenture and of such Security at any time prior to the close of business on
the Redemption Date applicable thereto.
ARTICLE TWELVE
SINKING FUNDS
Section 1201. Applicability of Article.
The provisions of this Article shall be applicable to any
sinking fund for the retirement of Securities of a series, except as otherwise
permitted or required by any form of Security of such series issued pursuant to
this Indenture.
The minimum amount of any sinking fund payment provided for by
the terms of Securities of any series is herein referred to as a "mandatory
sinking fund payment", and any payment in excess of such minimum amount
provided for by the terms of Securities of such series is herein referred to as
an "optional sinking fund payment". If provided for by the terms of Securities
of any series, the cash amount of any sinking fund payment may be subject to
reduction as provided in Section 1202. Each sinking fund payment shall be
applied to the redemption of Securities of any series as provided for by the
terms of Securities of such series.
Section 1202. Satisfaction of Sinking Fund Payments with
Securities.
The Company may, in satisfaction of all or any part of any
sinking fund payment with respect to the Securities of any series to be made
pursuant to the terms of such Securities (1) deliver Outstanding Securities of
such series (other than any of such Securities previously called for redemption
or any of such Securities in respect of which cash shall have been released to
the Company), together in the case of any Bearer Securities of such series with
all unmatured Coupons appertaining thereto, and (2) apply as a credit
Securities of such series which have been redeemed either at the election of
the Company pursuant to the terms of such series of Securities or through the
application of permitted optional sinking fund payments pursuant to the terms
of such Securities or which have been surrendered for conversion pursuant to
Article Seventeen, provided that such series of Securities have not been
previously so credited. Such Securities shall be received and credited for
such purpose by the Trustee at the
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Redemption Price specified in such Securities for redemption through operation
of the sinking fund and the amount of such sinking fund payment shall be
reduced accordingly. If as a result of the delivery or credit of Securities of
any series in lieu of cash payments pursuant to this Section 1202, the
principal amount of Securities of such series to be redeemed in order to
exhaust the aforesaid cash payment shall be less than $100,000, the Trustee
need not call Securities of such series for redemption, except upon Company
Request, and such cash payment shall be held by the Trustee or a Paying Agent
and applied to the next succeeding sinking fund payment, provided, however,
that the Trustee or such Paying Agent shall at the request of the Company from
time to time pay over and deliver to the Company any cash payment so being held
by the Trustee or such Paying Agent upon delivery by the Company to the Trustee
of Securities of that series purchased by the Company having an unpaid
principal amount equal to the cash payment requested to be released to the
Company.
Section 1203. Redemption of Securities for Sinking Fund.
Not less than 45 days prior to each sinking fund payment date
for any series of Securities (unless a shorter notice shall be satisfactory to
the Trustee), the Company shall deliver to the Trustee an Officers' Certificate
specifying the amount of the next ensuing mandatory sinking fund payment for
that series pursuant to the terms of that series, the portion thereof, if any,
which is to be satisfied by payment of cash and the portion thereof, if any,
which is to be satisfied by delivering and crediting of Securities of that
series pursuant to Section 1202, and the optional amount, if any, to be added
in cash to the next ensuing mandatory sinking fund payment, and will also
deliver to the Trustee any Securities to be so credited and not theretofore
delivered. If such Officers' Certificate shall specify an optional amount to
be added in cash to the next ensuing mandatory sinking fund payment, the
Company shall thereupon be obligated to pay the amount therein specified. Not
less than 40 days before each such sinking fund payment date the Trustee shall
select the Securities to be redeemed upon such sinking fund payment date in the
manner specified in Section 1103 and cause notice of the redemption thereof to
be given not less than 30 nor more than 40 days prior to the sinking fund
payment date in the name of and at the expense of the Company in the manner
provided in Section 1104. Such notice having been duly given, the redemption
of such Securities shall be made upon the terms and in the manner stated in
Sections 1106 and 1107.
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ARTICLE THIRTEEN
REPAYMENT AT THE OPTION OF HOLDERS
Section 1301. Applicability of Article.
Securities of any series which are repayable at the option of
the Holders thereof before their Stated Maturity shall be repaid in accordance
with the terms of the Securities of such series. The repayment of any principal
amount of Securities pursuant to such option of the Holder to require repayment
of Securities before their Stated Maturity, for purposes of Section 309, shall
not operate as a payment, redemption or satisfaction of the indebtedness
represented by such Securities unless and until the Company, at its option,
shall deliver or surrender the same to the Trustee with a directive that such
Securities be cancelled. Notwithstanding anything to the contrary contained in
this Section 1301, in connection with any repayment of Securities, the Company
may arrange for the purchase of any Securities by an agreement with one or more
investment bankers or other purchasers to purchase such Securities by paying to
the Holders of such Securities on or before the close of business on the
repayment date an amount not less than the repayment price payable by the
Company on repayment of such Securities, and the obligation of the Company to
pay the repayment price of such Securities shall be satisfied and discharged to
the extent such payment is so paid by such purchasers.
ARTICLE FOURTEEN
SECURITIES IN FOREIGN CURRENCIES
Section 1401. Applicability of Article.
Whenever this Indenture provides for (i) any action by, or the
determination of any of the rights of, Holders of Securities of any series in
which not all of such Securities are denominated in the same Currency, or (ii)
any distribution to Holders of Securities, in the absence of any provision to
the contrary in the form of Security of any particular series, any amount in
respect of any Security denominated in a Currency other than Dollars shall be
treated for any such action or distribution as that amount of Dollars that
could be obtained for such amount on such reasonable basis of exchange and as
of the record date with respect to Registered Securities of such series (if
any) for such action, determination of rights or distribution (or, if there
shall be no applicable record date, such other date reasonably proximate to the
date of such action, determination of
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rights or distribution) as the Company may specify in a written notice to the
Trustee or, in the absence of such written notice, as the Trustee may
determine.
ARTICLE FIFTEEN
MEETINGS OF HOLDERS OF SECURITIES
Section 1501. Purposes for Which Meetings May Be Called.
A meeting of Holders of Securities of any series may be called
at any time and from time to time pursuant to this Article to make, give or
take any request, demand, authorization, direction, notice, consent, waiver or
other action provided by this Indenture to be made, given or taken by Holders
of Securities of such series.
Section 1502. Call, Notice and Place of Meetings.
(a) The Trustee may at any time call a meeting of Holders
of Securities of any series for any purpose specified in Section 1501, to be
held at such time and at such place in The City of New York, or, if Securities
of such series have been issued in whole or in part as Bearer Securities, in
London or in such place outside the United States as the Trustee shall
determine. Notice of every meeting of Holders of Securities of any series,
setting forth the time and the place of such meeting and in general terms the
action proposed to be taken at such meeting, shall be given, in the manner
provided in Section 106, not less than 21 nor more than 180 days prior to the
date fixed for the meeting.
(b) In case at any time the Company (by or pursuant to a
Board Resolution) or the Holders of at least 10% in principal amount of the
Outstanding Securities of any series shall have requested the Trustee to call a
meeting of the Holders of Securities of such series for any purpose specified
in Section 1501, by written request setting forth in reasonable detail the
action proposed to be taken at the meeting, and the Trustee shall not have made
the first publication of the notice of such meeting within 21 days after
receipt of such request or shall not thereafter proceed to cause the meeting to
be held as provided herein, then the Company or the Holders of Securities of
such series in the amount above specified, as the case may be, may determine
the time and the place in The City of New York, or, if Securities of such
series are to be issued as Bearer Securities, in London for such meeting and
may call such meeting for such purposes by giving notice thereof as provided in
subsection (a) of this Section 1502.
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Section 1503. Persons Entitled to Vote at Meetings.
To be entitled to vote at any meeting of Holders of Securities
of any series, a Person shall be (1) a Holder of one or more Outstanding
Securities of such series, or (2) a Person appointed by an instrument in
writing as proxy for a Holder or Holders of one or more Outstanding Securities
of such series by such Holder or Holders. The only Persons who shall be
entitled to be present or to speak at any meeting of Holders of Securities of
any series shall be the Persons entitled to vote at such meeting and their
counsel, any representatives of the Trustee and its counsel and any
representatives of the Company and its counsel.
Section 1504. Quorum; Action.
The Persons entitled to vote a majority in principal amount of
the Outstanding Securities of a series shall constitute a quorum for a meeting
of Holders of Securities of such series; provided, however, that if any action
is to be taken at such meeting with respect to a consent or waiver which this
Indenture expressly provides may be given by the Holders of not less than
66-2/3% in principal amount of the Outstanding Securities of a series, the
Persons entitled to vote 66-2/3% in principal amount of the Outstanding
Securities of such series shall constitute a quorum. In the absence of a
quorum within 30 minutes after the time appointed for any such meeting, the
meeting shall, if convened at the request of Holders of Securities of such
series, be dissolved. In any other case the meeting may be adjourned for a
period of not less than 10 days as determined by the chairman of the meeting
prior to the adjournment of such meeting. In the absence of a quorum at any
such adjourned meeting, such adjourned meeting may be further adjourned for a
period of not less than 10 days as determined by the chairman of the meeting
prior to the adjournment of such adjourned meeting. Notice of the reconvening
of any adjourned meeting shall be given as provided in Section 1502(a), except
that such notice need be given only once not less than five days prior to the
date on which the meeting is scheduled to be reconvened. Notice of the
reconvening of an adjourned meeting shall state expressly the percentage, as
provided above, of the principal amount of the Outstanding Securities of such
series which shall constitute a quorum.
Except as limited by the proviso to Section 902, any
resolution presented to a meeting or adjourned meeting duly reconvened at which
a quorum is present as aforesaid may be adopted only by the affirmative vote of
the Holders of a majority in principal amount of the Outstanding Securities of
that series; provided, however, that, except as limited by the proviso to
Section 902, any resolution with respect to any consent or waiver which this
Indenture expressly provides may be given by the Holders of not less than
66-2/3% in principal amount of the Outstanding Securities of a series may be
adopted at a meeting or an adjourned meeting duly convened and at which a
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quorum is present as aforesaid only by the affirmative vote of the Holders of
66-2/3% in principal amount of the Outstanding Securities of that series; and
provided, further, that, except as limited by the proviso to Section 902, any
resolution with respect to any request, demand, authorization, direction,
notice, consent, waiver or other action which this Indenture expressly provides
may be made, given or taken by the Holders of a specified percentage, which is
less than a majority, in principal amount of the Outstanding Securities of a
series may be adopted at a meeting or an adjourned meeting duly reconvened and
at which a quorum is present as aforesaid by the affirmative vote of the
Holders of such specified percentage in principal amount of the Outstanding
Securities of such series.
Any resolution passed or decision taken at any meeting of
Holders of Securities of any series duly held in accordance with this Section
1504 shall be binding on all the Holders of Securities of such series and the
Coupons appertaining thereto, whether or not such Holders were present or
represented at the meeting.
Section 1505. Determination of Voting Rights; Conduct and
Adjournment of Meetings.
(a) Notwithstanding any other provisions of this
Indenture, the Trustee may make such reasonable regulations as it may deem
advisable for any meeting of Holders of Securities of such series in regard to
proof of the holding of Securities of such series and of the appointment of
proxies and in regard to the appointment and duties of inspectors of votes, the
submission and examination of proxies, certificates and other evidence of the
right to vote, and such other matters concerning the conduct of the meeting as
it shall deem appropriate. Except as otherwise permitted or required by any
such regulations, the holding of Securities shall be proved in the manner
specified in Section 104 and the appointment of any proxy shall be proved in
the manner specified in Section 104 or by having the signature of the person
executing the proxy witnessed or guaranteed by any trust company, bank or
banker authorized by Section 104 to certify to the holding of Bearer
Securities. Such regulations may provide that written instruments appointing
proxies, regular on their face, may be presumed valid and genuine without the
proof specified in Section 104 or other proof.
(b) The Trustee shall, by an instrument in writing,
appoint a temporary chairman of the meeting, unless the meeting shall have been
called by the Company or by Holders of Securities as provided in Section
1502(b), in which case the Company or the Holders of Securities of the series
calling the meeting, as the case may be, shall in like manner appoint a
temporary chairman. A permanent chairman and a permanent secretary of the
meeting shall be elected by vote of the Persons entitled to vote a majority in
principal amount of the Outstanding Securities of such series represented at
the meeting.
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(c) At any meeting, each Holder of a Security of such
series or proxy shall be entitled to one vote for each $1,000 principal amount
of Securities of such series held or represented by him; provided, however,
that no vote shall be cast or counted at any meeting in respect of any Security
challenged as not Outstanding and ruled by the chairman of the meeting to be
not Outstanding. The chairman of the meeting shall have no right to vote,
except as a Holder of a Security of such series or proxy.
(d) Any meeting of Holders of Securities of any series
duly called pursuant to Section 1502 at which a quorum is present may be
adjourned from time to time by Persons entitled to vote a majority in principal
amount of the Outstanding Securities of such series represented at the meeting;
and the meeting may be held as so adjourned without further notice.
Section 1506. Counting Votes and Recording Action of
Meetings.
The vote upon any resolution submitted to any meeting of
Holders of Securities of any series shall be by written ballots on which shall
be subscribed the signatures of the Holders of Securities of such series or of
their representatives by proxy and the principal amounts and serial numbers of
the Outstanding Securities of such series held or represented by them. The
permanent chairman of the meeting shall appoint two inspectors of votes who
shall count all votes cast at the meeting for or against any resolution and who
shall make and file with the secretary of the meeting their verified written
reports in triplicate of all votes cast at the meeting. A record, at least in
triplicate, of the proceedings of each meeting of Holders of Securities of any
series shall be prepared by the secretary of the meeting and there shall be
attached to said record the original reports of the inspectors of votes on any
vote by ballot taken thereat and affidavits by one or more persons having
knowledge of the facts setting forth a copy of the notice of the meeting and
showing that said notice was given as provided in Section 1502 and, if
applicable, Section 1504. Each copy shall be signed and verified by the
affidavits of the permanent chairman and secretary of the meeting and one such
copy shall be delivered to the Company, and another to the Trustee to be
preserved by the Trustee, the latter to have attached thereto the ballots voted
at the meeting. Any record so signed and verified shall be conclusive evidence
of the matters therein stated.
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ARTICLE SIXTEEN
SUBORDINATION
Section 1601. Securities Subordinated to Senior Indebtedness
The Company covenants and agrees, and each Holder of
Securities, by his acceptance thereof, likewise covenants and agrees, that the
indebtedness evidenced by the Securities and the payment of the principal of
(and premium, if any) and interest on and any Additional Amounts payable in
respect thereof is hereby expressly subordinated, to the extent and in the
manner hereinafter set forth, in right of payment to the prior payment in full
of Senior Indebtedness.
Anything in this Indenture or in the Securities of any series
to the contrary notwithstanding, the indebtedness evidenced by the Securities
shall be subordinate and junior in right of payment, to the extent and in the
manner hereinafter set forth, to all Senior Indebtedness:
(a) In the event of any insolvency or bankruptcy
proceedings, and any receivership, liquidation,
reorganization, arrangement or other similar proceedings in
connection therewith, relative to the Company or to its
property, and in the event of any proceedings for voluntary
liquidation, dissolution or other winding-up of the Company,
whether or not involving insolvency or bankruptcy, then the
holders of Senior Indebtedness shall be entitled to receive
payment in full of all principal, premium and interest on all
Senior Indebtedness before the Holders of the Securities or
any Coupons are entitled to receive any payment on account of
principal, premium, if any, interest or Additional Amounts
upon the Securities, and to that end (but subject to the power
of a court of competent jurisdiction to make other equitable
provisions reflecting the rights conferred in the Securities
upon Senior Indebtedness and the Holders thereof with respect
to the subordinated indebtedness represented by the Securities
and the Holders hereof by a lawful plan of reorganization
under applicable bankruptcy law) the holders of Senior
Indebtedness shall be entitled to receive for application in
payment thereof any payment or distribution of any kind or
character, whether in cash or property or securities, which
may be payable or deliverable in any such proceedings in
respect of the Securities after giving effect to any
concurrent payment or distribution in respect of such Senior
Indebtedness, except securities which are subordinate and
junior in right of payment to the payment of all Senior
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Indebtedness then outstanding;
(b) In the event that any Security of any series
is declared or otherwise becomes due and payable before its
expressed maturity because of the occurrence of an Event of
Default hereunder (under circumstances when the provisions of
the foregoing clause (a) or the following clause (c) shall not
be applicable), the holders of Senior Indebtedness outstanding
at the time such Security so becomes due and payable because
of such occurrence of an Event of Default hereunder shall, so
long as such declaration has not been rescinded and annulled
pursuant to Section 502, be entitled to receive payment in
full of all principal of, and premium and interest on, all
such Senior Indebtedness before the Holders of the Securities
of such series are entitled to receive any payment on account
of principal of, premium, if any, or interest and Additional
Amounts on the Securities of such series; provided, that
nothing herein shall prevent the Holders of Securities from
seeking any remedy allowed at law or in equity so long as any
judgment or decree obtained thereby makes provision for
enforcing this clause; and
(c) In the event that any default shall occur and
be continuing with respect to any Senior Indebtedness
permitting the holders of such Senior Indebtedness to
accelerate the maturity thereof, if either (i) notice of such
default, in writing or by telegram, shall have been given to
the Company and to the Trustee, provided that judicial
proceedings shall be commenced in respect of such default
within 180 days in the case of a default in payment of
principal or interest and within 90 days in the case of any
other default after the giving of such notice, and provided
further that only one such notice shall be given pursuant to
this Section 1601(c) in any twelve month period, or (ii)
judicial proceedings shall be pending in respect of such
default, the Holders of the Securities and the Trustee for
their benefit shall not be entitled to receive any payment on
account of principal, premium, if any, or interest and
Additional Amounts thereon (including any such payment which
would cause such default) unless payment in full of all
principal of, and premium and interest on, such Senior
Indebtedness shall have been made or provided for. The
Trustee, forthwith upon receipt of any notice received by it
pursuant to this Section 1601(c), shall, as soon as
practicable, send a notice thereof to each Holder of
Securities at the time Outstanding as the names and addresses
of such Holders appear on the Security Register.
In case despite the foregoing provisions, any payment or
distribution shall, in any such event, be paid or delivered to any Holder of
the Securities or to the Trustee
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for their benefit before all Senior Indebtedness shall have been paid in full,
such payment or distribution shall be held in trust for and so paid and
delivered to the holders of Senior Indebtedness (or their duly authorized
representatives) until all Senior Indebtedness shall have been paid in full.
The Company shall give written notice to the Trustee within
five days after the occurrence of any insolvency, bankruptcy, receivership,
liquidation, reorganization, arrangement or similar proceeding of the Company
within the meaning of this Section 1601. Upon any payment or distribution of
assets of the Company referred to in this Article Sixteen, the Trustee, subject
to the provisions of Section 315(a) through 315(b) of the Trust Indenture Act,
and the Holders of the Securities shall be entitled to rely upon a certificate
of the trustee in bankruptcy, receiver, assignee for the benefit of creditors
or other liquidating agent making such payment or distribution, delivered to
the Trustee or to the Holders of Securities, for the purpose of ascertaining
the Persons entitled 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 Sixteen.
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 distribution
pursuant to this Section 1601, 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, as to the extent to which such Person
is entitled to participate in such payment or distribution, and as to other
facts pertinent to the rights of such Person under this Section 1601, 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.
Section 1602. Subrogation.
Subject to the payment in full of all Senior Indebtedness to
which the indebtedness evidenced by the Securities is in the circumstances
subordinated as provided in Section 1601, the Holders of the Securities shall
be subrogated to the rights of the holders of such Senior Indebtedness to
receive payments or distributions of cash, property or securities of the
Company applicable to such Senior Indebtedness until all amounts owing on the
Securities shall be paid in full, and, as between the Company, its creditors
other than holders of such Senior Indebtedness, and the Holders of the
Securities, no such payment or distribution made to the holders of such Senior
Indebtedness by virtue of this Article which otherwise would have been made to
the Holders of the Securities shall be deemed to be a payment by the Company on
account of such Senior Indebtedness, it being understood that the provisions of
this Article
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Sixteen 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 1603. Obligation of Company Unconditional.
Nothing contained in this Article Sixteen or elsewhere in this
Indenture or in the Securities is intended to or shall impair, as between the
Company and its creditors other than the holders of Senior Indebtedness and the
Holders of the Securities, the obligation of the Company which is absolute and
unconditional, to pay to the Holders of the Securities the principal of (and
premium, if any), interest on, or any Additional Amounts with respect to, the
Securities and Coupons as and when the same shall become due and payable in
accordance with their terms, or is intended to or shall affect the relative
rights of the Holders of the Securities and creditors of the Company other than
the holders of 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 Sixteen 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 payment or distribution of assets of the Company
referred to in this Article Sixteen, the Trustee and the Holders of the
Securities shall be entitled to rely upon any order or decree made by any court
of competent jurisdiction in which any such dissolution, winding up,
liquidation or reorganization proceeding affecting the affairs of the Company
is pending or upon a certificate of the trustee in bankruptcy, receiver,
assignee for the benefit of creditors, liquidating trustee or agent or other
Person making any payment or distribution, delivered to the Trustee or to the
Holders of the Securities, for the purpose of ascertaining the Persons entitled
to participate in such payment or distribution, the holders of the Senior
Indebtedness and other indebtedness of the Company the amount thereof or
payable thereon, the amount paid or distributed thereon and all other facts
pertinent thereto or to this Article Sixteen.
Section 1604. Payments on Securities Permitted.
Nothing contained in this Article Sixteen or elsewhere in this
Indenture, or in any of the Securities, shall affect the obligation of the
Company to make, or prevent the Company from making payment of the principal of
(or premium, if any), interest or any Additional Amounts on the Securities in
accordance with the provisions hereof and thereof, except as otherwise provided
in this Article Sixteen.
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Section 1605. Effectuation of Subordination By Trustee.
Each Holder of Securities, by his acceptance thereof,
authorizes and directs the Trustee in his behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in this
Article Sixteen and appoints the Trustee his attorney-in-fact for any and all
such purposes.
Section 1606. Knowledge of Trustee.
Notwithstanding the provisions of this Article Sixteen or any
other provisions of this Indenture, the Trustee shall not be charged with
knowledge of the existence of any Senior Indebtedness, or any default in the
payment of the principal of or the premium, if any, or interest or Additional
Amounts on any Senior Indebtedness, except any Senior Indebtedness issued
pursuant to an instrument to which the Trustee hereunder is a party or pursuant
to an indenture under which the Trustee hereunder is Trustee, or of any facts
which would prohibit the making of any payment of monies to or by the Trustee,
or the taking of any other action by the Trustee, unless and until the Trustee
shall have received written notice thereof, before 12:00 noon on the last
Business Day prior to the date on which such payment is due, from the Company,
any Holder of the Securities, any paying or conversion agent of the Company or
the holder or representative of any class of Senior Indebtedness who shall have
been certified by the Company or otherwise established to the reasonable
satisfaction of the Trustee to be such a holder.
Section 1607. Trustee's Relation to Senior Indebtedness.
Except as otherwise provided in the Trust Indenture Act, the
Trustee shall be entitled to all the rights set forth in this Article with
respect to any Senior Indebtedness at the time held by it, to the same extent
as any other holder of Senior Indebtedness, and nothing in this Indenture shall
deprive the Trustee of any of its rights as such holder. Notwithstanding
anything in this Indenture or in the Securities of any series, nothing in this
Article Sixteen shall apply to claims of or payment to the Trustee under or
pursuant to Sections 506 and 605.
With respect to holders of Senior Indebtedness, the Trustee
undertakes to perform or to observe only such of its covenants and obligations
as are specifically set forth in this Article Sixteen, and no implied covenants
or obligations with respect to the holders of Senior Indebtedness shall be read
into this Indenture against the Trustee. The Trustee shall not be deemed to
owe any fiduciary duty to the holders of Senior Indebtedness and the Trustee
shall not be liable to any holder of Senior Indebtedness if it shall pay over
or deliver to Holders, the Company or any other Person monies or assets to
which any holder of Senior Indebtedness shall be entitled by virtue of this
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Article Sixteen or otherwise.
Section 1608. Rights of Holders of Senior Indebtedness Not
Impaired.
No right of any present or future holder of any Senior
Indebtedness to enforce the subordination herein shall at any time or in any
way be prejudiced or impaired by any act or failure to act on the part of the
Company or by any non-compliance by the Company with the terms, provisions or
covenants of this Indenture, regardless of any knowledge thereof any such
holder may have or be otherwise charged with.
ARTICLE SEVENTEEN
CONVERSION
Section 1701. Conversion Privilege.
Subject to and upon compliance with the provisions of this
Article Seventeen and the terms of the Convertible Securities of the series
proposed to be converted, at the option of the Holder, any Convertible Security
or any portion of the principal amount thereof which is $1,000 or an integral
multiple thereof, may be converted into shares of Common Stock, as said shares
shall be constituted at the Date of Conversion, at the Conversion Price for
such Convertible Securities of such series in effect at the Date of Conversion.
Section 1702. Manner of Exercise of Conversion Privilege.
In order to exercise the conversion privilege, the Holder of
any Convertible Security to be converted shall surrender such Convertible
Security to the Company at its office or agency in The City of New York,
together with the conversion notice in the form provided on the Securities (or
separate written notice) duly executed, and, if so required by the Company,
accompanied by instruments of transfer, in form satisfactory to the Company and
to the Trustee, duly executed by the Holder or by his duly authorized attorney
in writing. Any Registered Convertible Security so surrendered during the
period from the close of business on the Regular Record Date preceding an
Interest Payment Date for such Registered Convertible Security to the opening
of business on such Interest Payment Date shall (unless any such Registered
Convertible Security or the portion thereof being converted shall have been
called for redemption on a Redemption Date during such period, in which event
no interest shall be payable with
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respect to such Registered Convertible Security or portion thereof, as the case
may be, following such Redemption Date) also be accompanied by payment in New
York Clearing House funds or other funds acceptable to the Company of an amount
equal to the interest payable on such Interest Payment Date on the principal
amount of such Registered Convertible Security then being converted; provided,
however, that no such payment need be made if there shall exist, at the time of
conversion, a default in the payment of interest on the Convertible Securities
of such series. Except as provided in the immediately preceding sentence, no
adjustment shall be made for interest accrued on any Convertible Security that
shall be converted or for dividends on any shares of Common Stock that shall be
delivered upon the conversion of such Convertible Securities. The funds so
delivered to such office or agency shall be paid to the Company on or after
such Interest Payment Date, unless the Company shall default in the payment of
the interest due on such Interest Payment Date, in which event such funds shall
be repaid to the Person who delivered the same. As promptly as practicable
after the surrender of any Convertible Security for conversion as aforesaid,
the Company shall deliver at said office or agency to such Holder, or on his
written order, a certificate or certificates for the number of full shares
deliverable upon the conversion of such Convertible Security or portion thereof
and a check or cash in respect of any fraction of a share of Common Stock
otherwise deliverable upon such conversion, all as provided in this Article
Seventeen, together with a Convertible Security or Convertible Securities of
the same series in principal amount equal to the unconverted and unredeemed
portion, if any, of the Convertible Security so converted in accordance with
Section 305 hereof. Such conversion shall be deemed to have been effected on
the date on which such notice shall have been received at said office or agency
and such Convertible Security shall have been surrendered as aforesaid, and the
Person or Persons in whose name or names any certificate or certificates, for
shares of Common Stock shall be deliverable upon such conversion shall be
deemed to have become on said date the Holder or Holders of record of the
shares represented thereby, provided, however, that any such surrender on any
date when the stock transfer books of the Company shall be closed shall
constitute the Person or Persons in whose name or names the certificates are to
be delivered as the record Holder or Holders thereof for all purposes on the
next succeeding day on which such stock transfer books are open, but such
conversion shall be at the Conversion Price in effect on the date of such
surrender.
Section 1703. Cash Adjustment Upon Conversion.
The Company shall not be required to deliver fractions of
shares of Common Stock upon conversions of Convertible Securities. If more
than one Convertible Security shall be surrendered for conversion at one time
by the same Holder, the number of full shares which shall be deliverable upon
conversion thereof shall be computed on the basis of the aggregate principal
amount of the Securities so surrendered. If any fractional interest in a share
of Common Stock would be deliverable
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upon the conversion of any Convertible Security or Securities, the Company
shall make an adjustment therefor in cash equal to the current market value of
such fractional interest computed to the nearest cent either on the basis of
the last reported sale price regular way of the Common Stock on the New York
Exchange (or, if not listed on the New York Exchange, then on such other
exchange on which the shares of Common Stock are listed as the Company may
designate) on the last Business Day prior to the Date of Conversion or, if
there shall not have been a sale on such last Business Day, on the basis of the
average of the bid and asked quotations therefor on such exchange on such last
Business Day or, if the Common Stock shall not then be listed on any exchange,
at the highest bid quotation in the over-the-counter market on such last
Business Day as reported by the National Association of Securities Dealers
through NASDAQ, its automated system for reporting quotes, or its successor or
such other generally accepted source of publicly reported bid and asked
quotations as the Company may reasonably designate.
Section 1704. Conversion Price.
The Conversion Price applicable to any series of Convertible
Securities shall be the initial Conversion Price set forth on the Officers'
Certificate or supplemental indenture establishing such series adjusted as
provided in this Article Seventeen.
Section 1705. Adjustment of Conversion Price.
The Conversion Price applicable to any series of Convertible
Securities shall be adjusted from time to time as follows:
(a) In case the Company shall, at any time or from time
to time while the Securities of any series are Outstanding, (i) pay a dividend
on its Common Stock in shares of Common Stock, (ii) subdivide its outstanding
shares of Common Stock into a larger number of shares, or (iii) combine its
outstanding Common Stock into a smaller number of shares, the Conversion Price
for such series in effect immediately prior thereto shall be adjusted so that
the Holder of any Security of such series thereafter surrendered for conversion
shall be entitled to receive the number of shares of Common Stock or other
securities of the Company which he would have owned or have been entitled to
receive after the happening of any of the events described above, had such
Convertible Security of such series been converted immediately prior to the
happening of such event. An adjustment made pursuant to this subdivision (a)
shall become effective, in the case of a dividend, on the payment date
retroactively to immediately after the opening of business on the day following
the record date for the determination of shareholders entitled to receive such
dividend, subject to the provisions of paragraph (g) of this Section 1705, and
shall become effective in the case of a subdivision or combination immediately
after the opening of business on the day following the day
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when such subdivision or combination, as the case may be, becomes effective.
(b) In case the Company shall, at any time or from time
to time while the Convertible Securities of any series are Outstanding, issue
rights or warrants to all holders of its shares of Common Stock entitling them
(for a period expiring within 45 days of the record date mentioned below) to
subscribe for or purchase shares of Common Stock at a price per share less than
the current market price per share of Common Stock (as defined in paragraph (d)
below) at such record date, the Conversion Price of any series of Convertible
Securities in effect immediately prior to the issuance of such rights or
warrants shall be adjusted as follows: the number of shares of Common Stock
into which $1,000 principal amount of Convertible Securities of such series was
theretofore convertible shall be multiplied by a fraction, of which the
numerator shall be the number of shares of Common Stock outstanding immediately
prior to such record date plus the number of additional shares of Common Stock
offered for subscription or purchase, and of which the denominator shall be the
number of shares of Common Stock outstanding immediately prior to such record
date plus the number of shares which the aggregate offering price of the total
number of shares so offered would purchase at such current market price; and
the Conversion Price for such series of Convertible Securities shall be
adjusted by dividing $1,000 by the new number of shares into which $1,000
principal amount of Securities of such series shall be convertible as
aforesaid. Such adjustment shall become effective on the date of such issuance
retroactively to immediately after the opening of business on the day following
the record date for the determination of shareholders entitled to receive such
rights or warrants, subject to the provisions of paragraph (g) of this Section
1705. In determining whether any rights or warrants entitle the holders to
subscribe for or purchase shares of Common Stock at less than such current
market price, and in determining the aggregate offering price of such shares,
there shall be taken into account any consideration received by the Company for
such rights or warrants, the value of such consideration, if other than cash,
to be determined by the Board of Directors.
(c) In case the Company shall, at any time from time to
time while the Convertible Securities of any series are Outstanding, distribute
to all holders of shares of its Common Stock evidences of its indebtedness or
securities or assets (excluding cash dividends or cash distributions payable
out of consolidated net earnings or retained earnings) or rights or warrants to
subscribe for shares of Common Stock at a price per share less than the current
market price per share of Common Stock, determined in the manner set forth in
paragraph (d) below, but excluding rights or warrants referred to in paragraph
(b) above, the Conversion Price for such series of Convertible Securities in
effect immediately prior to such distribution shall be adjusted by multiplying
the number of shares of Common Stock into which $1,000 principal amount of
Convertible Securities of such series of Convertible Securities was theretofore
convertible by a fraction, of which the numerator shall be the current market
price per share of Common Stock (as
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<PAGE> 105
defined in paragraph (d) below) on the record date for such distribution, and
of which the denominator shall be such current market price per share of the
Common Stock, less the then fair market value (as determined by the Board of
Directors of the Company, whose determination shall be conclusive) of the
portion of such evidences of indebtedness, securities or assets or of such
subscription rights or warrants so distributed applicable to one share of
Common Stock; and the Conversion Price for such series of Convertible
Securities shall be adjusted by dividing $1,000 by the new number of shares
into which $1,000 principal amount of Convertible Securities of such series
shall be convertible as aforesaid. Such adjustment shall become effective on
the date of such distribution retroactively to immediately after the opening of
business on the day following the record date for the determination of
shareholders entitled to receive such distribution, subject to the provisions
of paragraph (g) of this Section 1705. For the purposes of this paragraph (c)
consolidated net earnings or retained earnings shall be computed by adding
thereto all charges against retained earnings on account of dividends paid in
shares of Common Stock in respect of which the Conversion Price has been
adjusted, all as determined by Independent Public Accountants, whose
determination shall be conclusive.
(d) For the purpose of any computation under paragraphs
(b) and (c) above, the current market price per share of Common Stock at any
date shall be deemed to be the average of the market values of the shares of
Common Stock for the ten consecutive Business Days immediately preceding the
day in question. The market value of the Common Stock for each day shall be
determined as provided in Section 1703 hereof.
(e) The Company may make such reductions in the
Conversion Price for any series of Convertible Securities, in addition to those
required by paragraphs (a), (b) and (c) of this Section as it considers to be
advisable in order that any event treated for Federal income tax purposes as a
dividend of stock or stock rights shall not be taxable to the recipients.
(f) Except as herein otherwise provided, no adjustment in
the Conversion Price for any series of Convertible Securities shall be made by
reason of the issuance, in exchange for cash, property or services, of shares
of Common Stock or any securities convertible into or exchangeable for shares
of Common Stock or carrying the right to purchase any of the foregoing.
(g) If the Company shall take a record of the holders of
its shares of Common Stock for the purpose of entitling them to receive any
dividend or any subscription or purchase rights or any distribution and shall,
thereafter and before the distribution to shareholders of any such dividend,
subscription or purchase rights or distribution, legally abandon its plan to
pay or deliver such dividend, subscription or
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purchase rights or distribution, then no adjustment of the Conversion Price for
any series of Convertible Securities shall be required by reason of the taking
of such record.
(h) No adjustment in the Conversion Price for any series
of Convertible Securities shall be required unless such adjustment would
require an increase or decrease of at least 1% in such price; provided,
however, that any adjustments which by reason of this paragraph (h) are not
required to be made shall be carried forward and taken into account in any
subsequent adjustment. All calculations under this Article Seventeen shall be
made to the nearest cent or to the nearest one-hundredth of a share, as the
case may be.
(i) Whenever the Conversion Price for any series of
Convertible Securities is adjusted as herein provided, the Company shall (i)
forthwith place on file at the Principal Office of the Trustee an Officers'
Certificate showing in detail the facts requiring such adjustment and the
Conversion Price after such adjustment and shall exhibit the same from time to
time to any Holder of Convertible Securities of such series desiring an
inspection thereof, and (ii) cause a notice stating that such adjustment has
been effected and the adjusted Conversion Price to be mailed to the Holders of
Registered Convertible Securities of such series at their last addresses as
they shall appear on the Security Register.
(j) The Company may delete, modify or vary any of the
provisions applicable to conversion of the Convertible Securities of any
series, or may add new provisions applicable thereto, all as may be contained
in the Board Resolutions and Officers' Certificate or supplemental indenture
establishing such series.
Section 1706. Effect of Reclassifications, Consolidations,
Mergers or Sales on Conversion Privilege.
In case of any reclassification or change of outstanding
shares of the class of Common Stock issuable upon conversion of the Convertible
Securities (other than a change in par value, or from par value to no par
value, or from no par value to par value, or as a result of a subdivision or
combination), or in case of any merger or consolidation of the Company with one
or more other corporations (other than a merger or consolidation in which the
Company is the continuing corporation and which does not result in any
reclassification or change of outstanding shares of Common Stock issuable upon
conversion of the Securities), or in case of the merger of the Company into
another corporation, or in case of any sale or conveyance to another
corporation of the property of the Company as an entirety or substantially as
an entirety, the Holders of Convertible Securities of each series then
Outstanding shall have the right to convert such Convertible Securities into
the kind and amount of shares of capital stock or other securities and
property, including cash, receivable upon such reclassifications change,
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consolidation, merger, sale or conveyance by a holder of the number of shares
of Common Stock into which such Convertible Securities might have been
converted immediately prior to such reclassification, change, consolidation,
merger, sale or conveyance. In any such case the Company, or such successor or
purchasing corporation, as the case may be, shall execute with the Trustee one
or more supplemental indentures (which shall conform to the Trust Indenture Act
of 1939 as in force at the date of the execution of such supplemental
indenture) containing provisions to the effect set forth above in this Section
1707 and providing further for adjustments which shall be as nearly equivalent
as may be practicable to the adjustments provided for in this Article
Seventeen; and any such adjustment which shall be approved by the Board of
Directors and set forth in such supplemental indenture or supplemental
indentures shall be conclusive for all purposes of this Section, and the
Trustee shall not be under any responsibility to determine the correctness of
any provision contained in such supplemental indenture or supplemental
indentures relating to either the kind or amount of shares of stock or
securities or property receivable by Holders of Securities of any series upon
the conversion of their Convertible Securities after any such reclassification,
change, consolidation, merger, sale or conveyance.
The above provisions of this Section 1707 shall similarly
apply to successive reclassifications, changes, consolidations, mergers, sales
and conveyances.
Section 1707. Taxes on Conversions.
The issue of stock certificates on conversions of Convertible
Securities shall be made without charge to the converting Holder of Convertible
Securities for any tax in respect of the issue thereof. The Company shall not,
however, be required to pay any tax which may be payable in respect of any
transfer involved in the issue and delivery of shares in any name other than
that of the Holder of any Registered Convertible Security converted, and the
Company shall not be required to issue or deliver any such stock certificate
unless and until the Person or Persons requesting the issue thereof shall have
paid to the Company the amount of such tax or shall have established to the
satisfaction of the Company that such tax has been paid.
Section 1708. Company to Reserve Common Stock. Privilege.
The Company shall at all times reserve and keep available out
of the aggregate of its authorized but unissued shares or its issued shares
held in its treasury, or both, for the purpose of effecting the conversion of
the Securities, such number of its duly authorized shares of Common Stock as
shall from time to time be sufficient to effect the conversion of all
Outstanding Securities.
If any shares of Common Stock reserved or to be reserved for
the purpose
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of conversion of Securities hereunder require registration with or approval of
any governmental authority under any Federal or State law before such shares
may be validly delivered upon conversion, then the Company covenants that it
will in good faith and as expeditiously as possible endeavor to secure
registration or approval, as the case may be.
The Company covenants that all shares of Common Stock which
may be delivered upon conversion of Convertible Securities shall upon delivery
be fully paid and nonassessable by the Company and free from all taxes, liens
and charges with respect to the issue or delivery thereof.
Section 1709. Disclaimer by Trustee of Responsibility for
Certain Matters.
Neither the Trustee nor any conversion agent shall at any time
be under any duty or responsibility to any Holder of Convertible Securities of
any series to determine whether any facts exist which may require any
adjustment of the Conversion Price for such series, or with respect to the
nature or extent of any such adjustment when made, or with respect to the
method employed, or herein or in any supplemental indenture provided to be
employed, in making the same, subject, however, to the provisions of Sections
315(a) through 315(b) of the Trust Indenture Act. Neither the Trustee nor any
conversion agent shall be accountable with respect to the validity or value (or
the kind or amount) of any shares of Common Stock, or of any securities or
property which may at any time be issued or delivered upon the conversion of
any Convertible Security; and neither of them makes any representation with
respect thereto. Neither the Trustee nor any conversion agent shall be
responsible for any failure of the Company to make any cash payment or to
issue, transfer or deliver any shares of Common Stock or stock certificates or
other securities or property upon the surrender of any Security for the purpose
of conversion or, subject to Sections 315(a) through 315(b) of the Trust
Indenture Act, to comply with any of the covenants of the Company contained in
this Article Seventeen.
Section 1710. Company to Give Notice of Certain Events.
In the event
(A) that the Company shall pay any dividend or
make any distribution to the holders of shares of Common Stock
otherwise than in cash charged against consolidated net
earnings or retained earnings of the Company and its
consolidated subsidiaries or in Common Stock; or
(B) that the Company shall offer for
subscription or purchase, pro
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rata, to the holders of shares of Common Stock any additional
shares of stock of any class or any securities convertible
into or exchangeable for stock of any class; or
(C) of any reclassification or change of
outstanding shares of the class of Common Stock issuable upon
the conversion of the Securities (other than a change in par
value, or from par value to no par value, or from no par value
to par value, or as a result of a subdivision or combination),
or of any merger or consolidation of the Company with, or
merger of the Company into, another corporation (other than a
merger or consolidation in which the Company is the continuing
corporation and which does not result in reclassification or
change of outstanding shares of Common Stock issuable upon
conversion of the Securities), or of any sale or conveyance to
another corporation of the property of the Company as an
entirety or substantially as an entirety;
then, and in any one or more of such events, the Company will give to the
Trustee and each conversion agent written notice thereof at least fifteen days
prior to (i) the record date fixed with respect to any of the events specified
in (A) and (B) above, and (ii) the effective date of any of the events
specified in (C) above; and shall mail in the case of Registered Securities,
promptly a copy of such notice to the Holders thereof at their last addresses
as they shall appear upon the Security Register or, in the case of Bearer
Securities, cause such notice to be published in an Authorized Newspaper.
Failure to give such notice, or any defect therein, shall not affect the
legality or validity of such dividend, distribution, reclassification,
consolidation, merger, sale, transfer, dissolution, liquidation or winding up.
ARTICLE EIGHTEEN
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS
Section 1801. Indenture and Securities Solely Corporate
Obligations.
No recourse for the payment of the principal of or premium, if
any, or interest or Additional Amounts on any Security, or for any claim based
thereon or otherwise in respect thereof, and no recourse under or upon any
obligation, covenant or agreement of the Company in this Indenture or in any
supplemental indenture or, in any Security, or because of the creation of any
indebtedness represented thereby, shall be had against any incorporator,
stockholder, officer or director, as such, past, present or future, of the
Company or of any successor corporation, either directly or through the Company
or any successor corporation, whether by virtue of any constitution, statute or
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rule of law, or by the enforcement of any assessment or penalty or otherwise;
it being expressly understood that all such liability is hereby expressly
waived and released as a condition of, and as a consideration for, the
execution of this Indenture and the issuance of the Securities.
* * * * *
This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed, all as of the day and year first above written.
[SEAL] Advanta Corp.
Attest:
By
- ------------------------------ -----------------------------------------
Name:
Title:
[SEAL] , as Trustee
-----------------------------
Attest:
By
- ------------------------------ -----------------------------------------
Name:
Title:
101
<PAGE> 111
STATE OF ____________ )
SS.:
COUNTY OF __________ )
On the _____ day of ________________, 1995, before me
personally came _______________, to me known, who, being by me duly sworn, did
depose and say that he is a _____________ of Advanta Corp., a Delaware
corporation, one of the persons described in and who executed the foregoing
instrument; that he knows the seal of said Corporation; that the seal affixed
to said instrument is such Corporation's seal; that it was so affixed by
authority of the Board of Directors of said Corporation; and that he signed his
name thereto by like authority.
------------------------------
Notary Public
[NOTARIAL SEAL]
102
<PAGE> 112
STATE OF ____________ )
SS.:
COUNTY OF __________ )
On the _____ day of ________________, 1995, before me
personally came _______________, to me known, who, being by me duly sworn, did
depose and say that he is a _____________ of
____________________________________, a national banking association organized
and existing under the laws of the United States, one of the persons described
in and who executed the foregoing instrument; that he knows the seal of said
Corporation; that the seal affixed to said instrument is such Corporation's
seal; that it was so affixed by authority of the Board of Directors of said
Corporation; and that he signed his name thereto by like authority.
----------------------------
Notary Public
[NOTARIAL SEAL]
103
<PAGE> 1
EXHIBIT 12.1
ADVANTA CORP.
AND SUBSIDIARIES
STATEMENTS SETTING FORTH DETAILS OF COMPUTATION OF RATIO
OF EARNINGS TO FIXED CHARGES AND PREFERRED DIVIDENDS
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
AND PREFERRED DIVIDENDS
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
THREE MONTHS
ENDED
MARCH 31, YEAR ENDED DECEMBER 31,
----------------- ----------------------------------------------------
1995 1994 1994 1993 1992 1991 1990
------- ------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Net earnings before extraordinary
items.............................. $30,783 $24,924 $106,063 $ 77,920 $ 48,037 $ 25,165 $ 15,095
Federal and state income taxes....... 17,670 14,142 59,144 45,335 29,063 14,154 7,435
------- ------- -------- -------- -------- -------- --------
Earnings before income taxes and
extraordinary items................ 48,453 39,066 165,207 123,255 77,100 39,319 22,530
------- ------- -------- -------- -------- -------- --------
Fixed charges:
Interest........................... 38,110 20,755 94,758 79,303 93,545 109,139 112,636
One-Third of all rentals........... 365 399 1,809 1,591 1,252 1,103 1,031
------- ------- -------- -------- -------- -------- --------
Total fixed charges.................. 38,475 21,154 96,567 80,894 94,797 110,242 113,667
------- ------- -------- -------- -------- -------- --------
Earnings before income taxes,
extraordinary items and fixed
charges............................ $86,928 $60,220 $261,774 $204,149 $171,897 $149,561 $136,197
------- ------- -------- -------- -------- -------- --------
Ratio of earnings to fixed charges... 2.26X 2.85X 2.71X 2.52X 1.81X 1.36X 1.20X
Preferred dividends.................. $ 141 $ 141 $ 141 $ 141 $ 141 $ 141 $ 141
Combined fixed charges and preferred
dividends.......................... 38,616 21,295 96,708 81,035 94,938 110,383 113,808
------- ------- -------- -------- -------- -------- --------
Ratio of earnings to combined fixed
charges and preferred dividends.... 2.25X 2.83X 2.71X 2.52X 1.81X 1.35X 1.20X
</TABLE>
2
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this Form S-3 Registration Statement of our reports dated
January 23, 1995 included in the Advanta Corp. Form 10-K for the year ended
December 31, 1994 and to all references to our Firm included in this Form S-3
Registration Statement.
/s/ ARTHUR ANDERSEN LLP
Philadelphia, PA
June 19, 1995
