1111
[TEXT]
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------
FORM 10-Q
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended November 30, 1993
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ____________ to ____________
Commission file Number: 1-7864
TRITON ENERGY CORPORATION
(Exact name of registrant as specified in its charter)
Texas 75-1151855
(State or other jurisdiction (I.R.S. Employer
of incorporation or Identification No.)
organization)
6688 N. Central Expressway, Suite 1400, Dallas, Texas 75206
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (214)691-5200
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
YES X NO_______
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable date.
Number of Shares
Title of Each Class of Common Stock Outstanding at December 31, 1993
Common Stock, par value $1.00 per share 35,414,224
<PAGE>
TRITON ENERGY CORPORATION AND SUBSIDIARIES
INDEX
PART I. Financial Information Page No.
Item 1. Financial Statements
Consolidated Condensed Balance Sheets -
November 30, 1993 and May 31, 1993 2
Consolidated Condensed Statements of Operations -
Three and six months ended November 30, 1993 and 1992 3
Consolidated Condensed Statements of Cash Flows -
Six months ended November 30, 1993 and 1992 4
Consolidated Condensed Statement of Stockholders' Equity -
Six months ended November 30, 1993 5
Notes to Consolidated Condensed Financial Statements 6
Review of Independent Accountants 10
Review Report of Independent Accountants 11
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 12
PART II. Other Information
Item 1. Legal Proceedings 18
Item 4. Results of Votes of Security Holders 18
Item 6. Exhibits and Reports on Form 8-K 22
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
TRITON ENERGY CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(Thousands of dollars)
<TABLE>
November 30,
1993 May 31,
ASSETS (Unaudited) 1993
<S> <C> <C>
Current assets:
Cash and equivalents $ 105,424 $ 52,939
Short-term investments 829 24,253
Receivables 13,151 16,716
Inventories 5,151 5,783
Net assets of discontinued operations, principally trade
receivables 9,733 21,789
Prepaid expenses and other 7,313 787
Total current assets 141,601 122,267
Property and equipment, at cost, less accumulated
depreciation and depletion of $471,169 and
$525,142, respectively 277,911 331,471
Investments and other assets 96,325 108,193
$ 515,837 $ 561,931
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Short-term borrowings and current
installments of long-term debt $ 3,125 $ 6,720
Accounts payable and accrued liabilities 39,439 38,840
Liabilities of discontinued operations,
principally debt 15,317 31,360
Deferred income taxes --- 2,583
Total current liabilities 57,881 79,503
Long-term debt, excluding current
installments 151,747 159,147
Convertible debentures due to employees --- ---
Deferred income taxes --- 13,178
Deferred income and other 9,505 9,100
Minority interest in subsidiaries 22,527 34,172
Redeemable preferred stock of subsidiary --- 11,399
Stockholders' equity:
Common stock, par value $1 35,332 35,231
Additional paid-in capital 503,153 502,217
Accumulated deficit (253,124) (276,965)
Foreign currency translation
adjustment (10,260) (4,087)
Adjustment for minimum pension liability (246) (246)
274,855 256,150
Less cost of common stock in treasury 678 718
Total stockholders' equity 274,177 255,432
Commitments and contingencies (Note 6)
$ 515,837 $ 561,931
</TABLE>
Oil and gas properties are accounted for using the full cost method.
See accompanying notes to consolidated condensed financial statements.
<PAGE>
TRITON ENERGY CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
Three and six months ended November 30, 1993 and 1992
(Thousands, except per share amounts)
(Unaudited)
<TABLE>
Three months ended Six months ended
November 30, November 30,
1993 1992 1993 1992
<S> <C> <C> <C> <C>
Revenue:
Sales and other operating revenues $ 13,407 $ 24,529 $ 35,972 $ 52,642
Gain on sale of Triton Canada
common stock --- --- 47,865 ---
Other income 3,964 969 9,506 2,412
17,371 25,498 93,343 55,054
Cost and expenses:
Operating, including nil, $2,075,
$3,325 and $4,385 to affiliate 11,596 13,742 24,870 27,709
General and administrative 8,954 9,063 16,014 17,134
Depreciation, depletion and
amortization 4,576 9,998 12,814 19,881
Foreign exchange (gain) loss 557 (5,631) (609) 600
Equity in loss of affiliates, net 392 2,003 30 4,082
Writedown of assets and loss provisions 11,634 3,603 23,896 4,434
Interest --- --- 2,918 ---
37,709 32,778 79,933 73,840
Earnings (loss) from continuing
operations before income taxes,
minority interest and cumulative
effect of accounting change (20,338) (7,280) 13,410 (18,786)
Income tax benefit (5,826) (1,140) (3,872) (2,819)
(14,512) (6,140) 17,282 (15,967)
Minority interest in (earnings) loss
of subsidiaries 3,275 (2,010) 6,559 (576)
Earnings (loss) from continuing
operations before cumulative effect
of accounting change (11,237) (8,150) 23,841 (16,543)
Discontinued operations:
Loss from operations --- (2,084) --- (2,072)
Gain on public stock offering --- 4,326 --- 13,841
Earnings (loss) before cumulative effect
of accounting chang (11,237) (5,908) 23,841 (4,774)
Cumulative effect of accounting change --- --- --- 4,017
Net earnings (loss) $ (11,237) $ (5,908) $ 23,841 $ (757)
Weighted average number of common shares
outstanding 34,718 34,100 34,684 34,030
Earnings (loss) per common share:
Continuing operations $ (0.32) $ (0.24) $ 0.69 $ (0.49)
Discontinued operations --- 0.07 --- 0.35
Cumulative effect of accounting change --- --- --- 0.12
Net earnings (loss) $ (0.32) $ (0.17) $ 0.69 $ (0.02)
</TABLE>
See accompanying notes to consolidated condensed financial statements.
<PAGE>
TRITON ENERGY CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
Six months ended November 30, 1993 and 1992
(Thousands of dollars)
(Unaudited)
<TABLE>
1993 1992
<S> <C> <C>
Cash flows from operating activities:
Net earnings (loss) $ 23,841 $ (757)
Adjustments to reconcile net earnings (loss) to net cash
used by operating activities:
Depreciation, depletion and amortization 12,814 21,686
Gain on Input/Output, Inc. public stock offering --- (13,841)
Gain on sale of Triton Canada common stock (47,865) ---
Gain on sale of domestic properties (7,033) ---
Equity in loss of affiliates 637 4,722
Writedown of assets 23,896 2,934
Foreign exchange loss (gain) (609) 600
Amortization of debt discount 2,918 ---
Deferred income taxes, minority interest and other (16,555) (5,186)
Changes in working capital pertaining to operating activities:
Receivables (879) (4,188)
Inventories 431 2,437
Prepaid expenses and other 5,523 (1,778)
Accounts payable and accrued liabilities (11,507) (13,547)
Income taxes (69) (527)
Net cash used by operating activities (14,457) (7,445)
Cash flows from investing activities:
Capital expenditures and investments (40,951) (48,290)
Proceeds from Input/Output, Inc. public stock offering --- 24,144
Proceeds from sale of Triton Canada common stock 59,029 ---
Proceeds from sale of domestic properties 19,590 ---
Purchases of short-term investments (5,364) (38,925)
Proceeds from short-term investments 28,788 ---
Other 9,761 (980)
Net cash provided (used) by investing activities 70,853 (64,051)
Cash flows from financing activities:
Proceeds from short-term borrowing with maturity
greater than three months --- 5,500
Short-term borrowings, net (820) (2,343)
Proceeds from long-term debt 1,443 127,864
Payments on long-term debt (2,657) (9,121)
Issuance of common stock 975 2,146
Other (2,892) (1,455)
Net cash provided (used) by financing activities (3,951) 122,591
Effect of exchange rate changes on cash and equivalents 40 (546)
Net increase in cash and equivalents 52,485 50,549
Cash and equivalents at beginning of period 52,939 52,601
Cash and equivalents at end of period $ 105,424 $ 103,150
</TABLE>
See accompanying notes to consolidated condensed financial statements.
<PAGE>
TRITON ENERGY CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENT OF STOCKHOLDERS' EQUITY
Six months ended November 30, 1993
(Thousands of dollars)
(Unaudited)
<TABLE>
Additional Total
Common paid-in Accumulated Treasury stockholders'
stock capital deficit Other stock equity
<S> <C> <C> <C> <C> <C> <C>
Balances at May 31,
1993 $ 35,231 $ 502,217 $ (276,965) $ (4,333) $ (718) $ 255,432
Net earnings --- --- 23,841 --- --- 23,841
Foreign currency translation
adjustment --- --- --- 6173 --- (6,173)
Exercise of employee stock
options and conversion of
employee debentures 101 874 --- --- --- 975
Other --- 62 --- --- 40 102
Balances at
November 30,
1993 $ 35,332 $ 503,153 $ (253,124) $ (10,506) $ (678) $ 274,177
</TABLE>
See accompanying notes to consolidated condensed financial statements.
<PAGE>
TRITON ENERGY CORPORATION
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Unaudited)
(1) General
In the opinion of management, the accompanying unaudited
consolidated condensed financial statements of Triton Energy
Corporation and Subsidiaries (collectively, the "Company")
contain all adjustments of a normal recurring nature necessary
to present fairly the Company's financial position as of
November 30, 1993 and the results of its operations for the
three and six months ended November 30, 1993 and 1992, its cash
flows for the six months ended November 30, 1993 and 1992, and
stockholders' equity for the six months ended November 30, 1993.
The results of operations for the three and six months ended
November 30, 1993 and 1992 are not necessarily indicative of the
results to be expected for the full year.
The consolidated condensed financial statements should be read
in conjunction with the Notes to Consolidated Financial
Statements, which are included as part of the Company's Annual
Report on Form 10-K for the year ended May 31, 1993.
The consolidated condensed financial statements for the three
and six months ending November 30, 1992 have been restated for
the adoption of FAS 109, "Accounting for Income Taxes" effective
June 1, 1992. The condensed consolidated statement of
operations for the three and six months ended November 30, 1992
has been restated to present the wholesale fuel products segment
as discontinued operations.
(2) Earnings (loss) per Common Share
Earnings (loss) per common share for the three and six months
ended November 30, 1993 and 1992 were based on the earnings
(loss) applicable to common stock divided by the weighted
average number of common shares outstanding, which excluded the
Company's share of its common stock owned by Crusader Limited
("Crusader"). Fully diluted earnings (loss) per common share is
not presented due to the antidilutive effect of including all
potentially dilutive securities.
(3) Discontinued Operations and Divestitures
As a result of selling its 76% interest in the common stock of
Triton Canada Resources Ltd. ("Triton Canada"), the Company
recorded a pretax gain of $47,865,000 during the first quarter.
Net sale proceeds of $59,029,000 were received during the second
quarter.
During August and October 1993, the Company sold its U.S.
working interest properties for net proceeds of $19,590,000
resulting in a gain of $7,033,000. The properties that were
sold accounted for approximately 55.7% ($21,570,000) of
discounted future net revenues associated with U.S. proved
reserves at May 31, 1993.
In fiscal 1993, the Company initiated a plan to discontinue its
remaining operations in the wholesale fuel products segment. On
September 16, 1993 the Company completed the sale of the
aviation fuel component of this segment for approximately
$15,000,000. The proceeds were used principally to retire
existing obligations of this operation. The remaining assets
and liabilities, consist principally of wholesale fuel products
operations in Texas, Colorado, Utah and California. The loss
from operations for the six months ended November 30, 1993 of
$2,000,000 was included in the estimated loss on disposal of
discontinued operations recorded in fiscal 1993.
The operating results of Input/Output, Inc. ("Input/Output")
have been presented as discontinued operations in the Company's
consolidated condensed statements of operations because of the
Company's sale of its remaining 26.9% interest in Input/Output
through a secondary public<PAGE> offering on August 12, 1992.
The net cash proceeds from the offering were $24,144,000 and
resulted in a gain of $13,841,000 in 1992.
(4) Writedown of Assets
During the six months ended November 30, 1993, the carrying
amounts of the Company's evaluated oil properties in France were
written down by $23,896,000. During the six months ended
November 30, 1992, oil and gas properties in the United States
and Indonesia were written down by $831,000 and $2,055,000,
respectively. These writedowns occurred principally as a result
of lower oil prices, through application of the ceiling
limitation prescribed by the Securities and Exchange Commission
(the "Commission").
(5) Statements of Cash Flows
The Company generally considers all highly liquid investments
purchased with an original maturity of three months or less to
be cash equivalents.
Supplemental disclosures of cash flow information for the six
months ended November 30, 1993 and 1992 follow (thousands of
dollars):
<TABLE>
1993 1992
<S> <C> <C>
Cash paid during the periods for:
Interest (net of amount capitalized) $ --- $ ---
Income taxes 122 1,234
Noncash investing and financial activities
Liabilities resulting from acquisition --- 1,265
Sale of the Company's shares by Crusader Limited --- 2,780
</TABLE>
(6) Commitments and Contingencies
(a) Commitments
During the normal course of business, the Company is subject to
the terms of various operating agreements and capital
commitments associated with the exploration and development of
its oil and gas properties. Many of these commitments are
discretionary on the part of the Company. It is management's
belief that such commitments, including the capital requirements
in Colombia, discussed below, will be met without any material
adverse effect on the Company's consolidated financial condition.
The first eight wells tested in the Company's Cusiana and
Cupiagua fields ("Cusiana Project") in Colombia indicate
significant oil discoveries on which the Company expects to
incur significant capital expenditures in fiscal 1994 for
exploratory and development drilling, pipeline and production
facilities and related activities. The Company's capital budget
for fiscal 1994, adopted in June 1993, is approximately $140
million, excluding capitalized interest, of which approximately
$100 million relates to Colombia. The Company believes that
current working capital, together with the proceeds from the
sale of the 9 3/4% Senior Subordinated Discount Notes (See Note
7, Subsequent Event), will be sufficient to finance this
commitment into 1995.<PAGE>
(b) Guarantees
At November 30, 1993, the Company had guaranteed approximately
$1,227,000 of loans from financial institutions to purchasers of
seismic equipment from Input/Output. The guarantees have been
reduced from a high of $6,576,000 million at May 31, 1991.
Input/Output has indemnified the Company against any loss as a
result of the guarantees. The Company has also guaranteed
$9,360,000 of loans related to its ownership in a Colombian
pipeline and $2,016,000 of loans from financial institutions
related to aviation property. Additionally, in December, 1993
the Company guaranteed $1,300,000 in indebtedness that may be
incurred by the chief executive officer of the Company to
finance the construction of his primary residence.
(c) Shareholder Lawsuits
From May 27, 1992 through June 15, 1992, several suits were
filed in the United States District Court for the Northern
District of Texas, Dallas Division, by seven alleged
shareholders against the Company and various present and former
directors and officers of the Company. Plaintiffs in all of
these cases seek to represent alleged classes of purchasers of
the Company's securities. On October 5, 1992, the plaintiffs in
all but one of the suits collectively filed a First Amended
Consolidated and Supplemental Class Action Complaint ("Amended
Complaint") in which they allege violations of the Securities
Exchange Act of 1934 ("Exchange Act") and Rule 10b-5 promulgated
thereunder, common law fraud and statutory fraud and negligent
misrepresentation. Among other allegations, the plaintiffs
additionally allege illegal trades of the Company's stock by
certain of the defendants based on inside information.
The Court has denied defendants' motion to consolidate the
remaining lawsuit with the suit in which the Amended Complaint
was filed. Among other allegations, the plaintiffs in this
lawsuit assert claims based upon an alleged conspiracy among the
defendants in the case to manipulate the price of the Company's
securities and alleged insider trading. The plaintiffs' claims
include alleged violations of the Exchange Act and Rule 10b-5 in
connection with various public disclosures made by the Company.
In two separate actions, alleged shareholders of the Company
filed suits on June 2, 1992 and June 9, 1992 in Dallas County
District Court against the Company as nominal defendant, and
various current and former directors and officers of the
Company. Plaintiffs in these derivative actions seek to assert
claims on behalf of the Company based upon, among other
allegations, claims that the defendants violated state laws
through alleged breaches of fiduciary duties, waste of assets
and constructive fraud on the Company and that they failed to
properly manage the Company's affairs with respect to securities
laws disclosure obligations and the Company's operations in
Indonesia. More specifically, plaintiffs allege that defendants
failed to maintain proper internal controls, paid bribes,
falsified certain records, and violated certain laws.
Plaintiffs seek, among other relief, to recover actual and
exemplary monetary damages of an unspecified amount on the
Company's behalf. The Court consolidated these derivative
actions pursuant to Agreed Orders of Consolidation. These
actions have been abated until further order of the Court
although the plaintiffs and defendants may proceed with certain
discovery during the period of abatement.
The Company and the individual defendants have agreed
with the plaintiffs' counsel to settle all of the
above actions, and have agreed with their insurers
regarding their respective funding of the settlement and defense
costs. Under the agreement with the insurers,
one-third of settlement and defense costs, including<PAGE>
independent counsel for the individual defendants, would be
funded by the Company and two-thirds would be funded by the
insurers. Completion of the settlement is subject to various
conditions, including court approval. The Company has deposited
$1,983,000 in Trust for the settlement which has been accrued.
(d) Regulatory Matters
On July 28, 1992, the Commission requested that the Company
provide to the Commission, on a voluntary basis, information and
documents regarding certain of the Company's employees and
former employees, the Company's operations in Indonesia, the
Company's dealings with Indonesian officials and the Company's
internal accounting controls. The staff of the Commission has
advised the Company that the Company should not construe this
inquiry as an indication that any violation of law has occurred
or as an adverse reflection upon any person, entity or security.
Subsequently, the Company has been advised that the Justice
Department is conducting a similar inquiry. The Company is
voluntarily cooperating with both agencies and has made
available various documents. Based upon the Company's review of
the inquiries and the information available to the Company to
date, the Company believes that it will be able to resolve any
questions that either agency might have in a manner that would
not have a material adverse effect on the Company's consolidated
financial condition.
(e)Other Litigation
The Company is also subject to ordinary litigation that is
incidental to its business, none of which is expected to have a
material adverse effect on the Company's consolidated financial
condition.
(7) Subsequent Event
On December 16, 1993, the Company completed the sale of
$170,000,000 face value of 9 3/4% Senior Subordinated Discount
Notes ("9 3/4% Notes") due December 15, 2000, under the
$300,000,000 shelf registration statement filed by the Company
in September 1993. Net proceeds to the Company of approximately
$124,000,000 will be used to fund capital expenditure
requirements relating to the Company's exploration and
development program, primarily in Colombia, and for general
corporate purposes. No interest will be paid on the 9 3/4%
Notes prior to December 15, 1996. Commencing December 15, 1996,
interest on the 9 3/4% Notes will accrue at the rate of 9 3/4%
per annum and will be payable in cash semi-annually on each
December 15 and June 15, commencing on June 15, 1997. The
indenture governing the 9 3/4% Notes contains certain covenants
that, among other restrictions, limit the ability of the Company
and certain of its subsidiaries to incur indebtedness, pay
dividends and make certain investments, engage in transactions
with its affiliates, incur or maintain certain liens securing
indebtedness other than Senior Indebtedness unless the 9 3/4%
Notes are equally and ratably secured, and engage in mergers and
consolidations.
<PAGE>
REVIEW OF INDEPENDENT ACCOUNTANTS
Price Waterhouse, independent accountants, have reviewed the
consolidated financial information as of November 30, 1993, and
for the three and six month period then ended, included in the
report. Such review was made in accordance with standards
established by the American Institute of Certified Public
Accountants. See accompanying independent accountant's review
report.<PAGE>
REVIEW REPORT OF INDEPENDENT ACCOUNTANTS
To The Board of Directors and Shareholders of Triton Energy
Corporation
We have reviewed the accompanying consolidated condensed balance
sheet of Triton Energy Corporation and subsidiaries as of
November 30, 1993, the related consolidated condensed statements
of operations for the three and six month periods ended November
30, 1993 and the consolidated condensed statements of cash flows
and of stockholders' equity for the six month period ended
November 30, 1993. This financial information is the
responsibility of the company's management.
We conducted our review in accordance with standards established
by the American Institute of Certified Public Accountants. A
review of interim financial information consists principally of
applying analytical procedures to financial data and making
inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit
conducted in accordance with generally accepted auditing
standards, the objective of which is the expression of an
opinion regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material
modifications that should be made to the accompanying financial
information for it to be in conformity with generally accepted
accounting principles.
We have previously audited in accordance with generally accepted
auditing standards, the consolidated balance sheet as of May 31,
1993, and the related consolidated statements of operations,
stockholders' equity and cash flows for the year then ended (not
presented herein), and in our report dated August 18, 1993 we
expressed an unqualified opinion on those consolidated financial
statements. In our opinion, the information set forth in the
accompanying consolidated condensed balance sheet as of May 31,
1993, is fairly stated in all material respects in relation to
the consolidated balance sheet from which it has been derived.
PRICE WATERHOUSE
Dallas, Texas
January 10, 1994
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Liquidity and Capital Resources
General
During 1993, the Company initiated several strategic changes
with respect to its existing exploration and development
programs and non-oil and gas businesses. The Company is
focusing its resources in high potential exploration and
development opportunities in Colombia, Malaysia/Thailand and
Argentina, and in new ventures. Existing production, publicly
owned subsidiaries and affiliates and non-oil and gas assets
have been re-evaluated in order to sharpen this focus. This
review led to the strategic decisions to divest of the Company's
working interests in oil and gas reserves in the United States,
to sell Triton's common equity interest in Triton Canada, to
reassess development prospects in France and to discontinue
operations in the wholesale fuel products segment. The
Company's financial condition is expected to improve due to
reductions in certain capital expenditures, operating expenses
and general and administrative expenses resulting from the
realignment of both operations and staffing levels as this
process continues. The Company has also taken steps to increase
its financing flexibility.
Net working capital was $83.7 million at November 30, 1993 and
$42.8 million at May 31, 1993. The current ratios at such dates
were 2.4:1 and 1.5:1, respectively. During the current six
months, proceeds from the sale of a portion of reserves in the
United States ($19.6 million), the sale of the Company's common
interest in Triton Canada ($59 million) and proceeds from short
term investments ($28.8 million) were the principal sources of
funds required for the Company's capital expenditures and
operating activities. For the six months ended November 30,
1992, proceeds from the issuance of $126 million, 12 1/2% Senior
Subordinated Discount Notes due November 1, 1997 ("1997 Notes"),
the sale of the Company's investment in Input/Output stock (net
proceeds $24.1 million) and working capital were utilized as
funding sources.
On December 16, 1993, the Company completed the sale of $170
million 9 3/4% Senior Subordinated Discount Notes due December
15, 2000 ("9 3/4% Notes") for net proceeds of approximately $124
million.
Capital Requirements and Funding Alternatives
Continued funding for development of the oil fields in Colombia
in particular will require significant additional capital. At
November 30, 1993, Triton had approximately $106 million in cash
and short-term investments on hand, which the Company believes,
together with the proceeds from sale of the 9 3/4% Notes, will
be sufficient to fund currently anticipated capital expenditures
into 1995. The Company's capital budget for fiscal 1994,
adopted in June of 1993, is approximately $140 million,
excluding capitalized interest, of which approximately $100
million relates to Colombia. Substantially all of these budgeted
expenditures will be dedicated to oil and gas exploration and
development activities.
Total capital requirements for the full field development of
operations in Colombia have not been determined, although they
are expected to continue at substantial levels through at least
1996. The Company expects to meet its capital needs in fiscal
1995 and later years with cash flow from operations, proceeds
from asset sales and the issuance of debt or equity securities.
Financing Activities
Asset Sales
On August 12, 1992, the Company sold its remaining holdings of
1,955,000 shares of common stock of the Company's former
affiliate, Input/Output. Net proceeds to the Company were
approximately $24 million. The Company recognized a gain of
$13.8 million from this sale.<PAGE>
On September 10, 1993, the Company completed the sale of its
30.5 million shares of common stock in Triton Canada. Upon
completion of the sale, the Company received net proceeds of $59
million and recognized a pretax gain of $47.9 million during the
quarter ended August 31, 1993.
In August and October 1993, the Company sold its working
interest reserves in the United States, realized net proceeds of
approximately $19.6 million and recognized a gain of $7 million.
On September 16, 1993, the Company sold the aviation fuels
component of its wholesale fuel products segment for
approximately $15 million. The proceeds were principally used
to retire existing obligations of this operation.
Securities Sale
On September 22, 1993, the Company filed a shelf registration
statement with the Commission for up to $300 million face amount
of debt securities. Under this shelf registration, in December,
1993, the Company completed, the sale of the 9 3/4% Notes. Net
proceeds to the Company of approximately $124 million will be
used to fund capital expenditure requirements relating to the
Company's exploration and development program, primarily in
Colombia, and for general corporate purposes. The indenture to
the 9 3/4% Notes contains certain covenants that, among other
restrictions, limit the ability of the Company and certain of
its subsidiaries to incur indebtedness, pay dividends and make
certain investments, engage in transactions with its affiliates,
incur or maintain certain liens securing indebtedness other than
Senior Indebtedness unless the 9 3/4% Notes are equally and
ratably secured, and engage in mergers and consolidations.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Consolidated Results of Operations
Overview
The Company reported a significant increase in earnings from
continuing operations during the six months ended November 30,
1993. The increase was due primarily to the sales of the
Company's investment in Triton Canada and its U.S. working
interest properties, which resulted in an aggregate pretax gain
of $54.9 million. Offsetting this effect in part was a $23.9
million writedown in the carrying amount of the Company's French
oil and gas properties during the current period ($7.9 million
effect after tax and minority interest).
Segment Review
The following table and related discussion summarize the
contributions to operating profit or loss by the Company's major
remaining industry segments for the three and six months ended
November 30, 1993 and 1992. Operating profit or loss represents
sales and other operating revenues, less total costs and
expenses (including writedowns on operating assets) and
excludes, among other items, interest and other income/expense,
and general corporate expenses.
<TABLE>
Three Months Ended Six Months Ended
November 30, November 30,
1993 1992 1993 1992
(In thousands of dollars, except where
indicated and except for per unit averages)
<S> <C> <C> <C> <C>
Oil and gas exploration and production activities, excluding
equity investees:
Oil production (Mbbls) 633 681 1,308 1,456
Gas production (Mmcf) 31 4,314 4,142 8,580
Weighted average price per bbl 16.14 18.85 16.44 19.79
Weighted average price per Mcf 1.90 1.11 1.29 1.08
Total sales 10,164 18,208 27,151 39,077
Operating loss (15,776) (5,401) (30,112) (5,606)
Writedowns, included in operating loss 11,634 2,055 23,896 2,886
Aviation sales and services:
Total sales 3,296 5,054 7,387 10,893
Operating loss (1,972) (174) (2,618) (719)
</TABLE>
Oil and Gas Activities
Oil sales decreased during the current period due to lower
volumes (148,000 barrels or a $4.3 million effect on revenue)
and lower oil prices ($3.34 per barrel or a $2.9 million effect
on revenue). The decline in oil volume occurred principally in
France due to a natural decline in the Villeperdue field. This
decline is expected to continue. Production in France was down
206,000 barrels during the current six months, representing a
$4.4 million decrease in revenue. Lower volumes in Indonesia
and the United States, aggregating 200,000 barrels, caused a
decline of $3.5 million. These decreases were partially offset
by the impact of Colombian production (278,000 barrels or a $3.9
million effect) as production commenced during the third quarter
of fiscal 1993. Oil prices also decreased, principally in
France ($4.37 per barrel for an effect of $2.6 million). Gas
sales decreased during the period by $3.9 million due to the
August, 1993 sale of Triton Canada and the first and second
quarter sales of U.S. working interest properties. The
Company's remaining properties produce primarily oil.<PAGE>
The increase in oil and gas production costs was primarily due
to new production in Colombia during the current period. This
effect was offset in part by decreases in Canadian and United
States' oil and gas production. Average oil and gas production
costs per equivalent barrel increased to $7.86 in fiscal 1994
from $5.50 in the prior year principally due to operating costs
in Colombia as production commenced during third quarter of
fiscal 1993.
Depletion decreased $7.3 million (from $18 million in fiscal
1993) because of property sales, declining production and a lower depletable
base due to current and prior period writedowns. A writedown of
$23.9 million was recorded in France, principally due to the
effect of lower prices. The prior year writedown related to
United States and Indonesian properties.
Oil and gas sales, volumes and related operating expenses are
expected to continue to decline as a result of the Company's
sale of its interest in Triton Canada and its U.S. working
interest properties. Total sales associated with these
divestitures amounted to $6.8 million during the current six
months.
Aviation Sales and Services
Sales and operating expenses in the aviation segment decreased
$3.5 million and $.8 million, respectively, principally from
fewer sales of aircraft during the current period, the
divestiture of three fixed based operations and a reduction in
charter and maintenance services. The operating expense
decrease was partially offset by an accrual of $1.7 million for
environmental costs. The near-term outlook for operations
currently remaining in this segment has diminished due to a
continuing decline in demand for general aviation goods and
services.
Overall Financial Review
Revenue
As discussed under "Segment Review," the decrease in sales and
other operating revenues resulted from lower sales in the oil
and gas and aviation sales and services segments. During the
current six months, the Company realized a $47.9 million gain
from the sale of its common investment in Triton Canada. Other
income increased due to a $7 million gain recorded on the sale
of oil and gas properties in the United States during fiscal
1994.
Costs and Expenses
Operating expenses decreased $2.8 million. A decline in the
aviation segment and the sale of Triton Canada and the U.S.
properties was partially offset by initial operating expenses in
Colombia, which began commercial production in December 1992.
Details about these and other variations are explained in
"Segment Review."
General and administrative expenses decreased $1.1 million
primarily because of the sale of Triton Canada and decreases in
costs associated with restructuring, offset somewhat by
increases in corporate compensation.
Interest expense increased during the period because of the
amortization of debt discount ($8.8 million effect before
capitalization) associated with the 1997 Notes issued in November 1992.
During the six months ended November 30, 1993, a $.6 million
foreign exchange gain was recognized, primarily in France,
compared to a $.6 million loss during the prior period. A loss
of $.6 million was recognized for the three months ended
November 30, 1993 compared to a gain of $5.6<PAGE>
million for the prior period. The exchange gains (losses) have resulted
principally from the translation of foreign currency denominated
deferred income taxes into United States dollars.
Equity in earnings (losses) of affiliates during the three and
six months ended November 30, 1993 and 1992 consisted of the
following:
<TABLE>
Three Months Ended Six Months Ended
November 30, November 30,
1993 1992 1993 1992
(In thousands)
<S> <C> <C> <C> <C>
Crusader, 49.9% owned $ (387) $ (1,176) $ (202) $ (1,843)
Aero, 28% owned --- (860) --- (2,270)
Other (5) 33 172 31
$ (392) $ (2,003) $ (30) $ (4,082)
</TABLE>
Crusader's results of operations improved primarily because of
decreases in losses from its smokeless fuel operation in Ireland
and increased profitability in the U.S. and Canadian
subsidiaries. The Company's investment in Aero was carried at
cost during the current period.
Depreciation, depletion and amortization decreased $7.1 million
(from $19.9 million in fiscal 1993) principally as the result of
lower depletion, due to declining production and the Company's
sale of Canada and its U.S. properties. See "Segment Review".
Discontinued Operations
The results of operations for the wholesale fuel products
segment have been reported as a discontinued operation in
fiscal 1993 because of the Company's decision to sell these
businesses. An estimated loss on the disposal of the segment of
$16.1 million was recorded during the fourth quarter of fiscal
1993. Net proceeds from the sale of assets associated with the
segment will be used to retire existing obligations of the
division. Also reported as a discontinued operation during
fiscal 1993 were the results of operations for Input/Output,
representing the Company's seismic equipment sales and services
segment. On August 12, 1992, the Company's remaining 26.9%
interest in Input/Output was sold through a secondary public
offering. The Company realized a gain of $13.8 million during
fiscal 1993 as a result of this sale.
Income Taxes
The Company adopted SFAS No. 109, "Accounting for Income Taxes",
effective June 1, 1992. The cumulative benefit of the change to
the liability based method under SFAS No. 109 of $4 million, or
$.12 per share was recorded in the first quarter of fiscal
1993.<PAGE>
Minority Interest in (Earnings) Loss of Subsidiaries
The change in minority interest between 1992 and 1993 was due
primarily to a decline in profitability by Triton Europe. As
discussed previously, this decline resulted principally from a
writedown in the carrying cost of oil and gas properties during
the current period.
Environmental Matters
The Company's United States oil and gas exploration and fuels
businesses involve the storage, handling and sale of hazardous
materials, including fuel storage in underground tanks.
Although the Company has sold a substantial portion of those
businesses, it will remain liable for certain environmental
matters that may arise from its and its predecessors' past
operations. Although the Company believes that the level of
future expenditures for environmental matters, including cleanup
obligations, is impracticable to determine with any reasonable
degree of probability, management believes that such costs, when
finally determined, will not have a material adverse effect on
the Company's consolidated financial position. The Company,
during the six months ended November 30, 1993, accrued $2.1
million for environmental costs.<PAGE>
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The discussion in Note 6(c) through (e) to Consolidated
Condensed Financial Statements is herein incorporated by
reference into this Part II.
ITEM 4. RESULTS OF VOTES OF SECURITY HOLDERS
As a result of the Annual Meeting of Shareholders held on
November 11, 1993, the shareholders re-elected four directors,
Herbert L. Brewer (29,023,158 for and 410,222 against), Jesse E.
Hendricks (29,174,300 for and 259,080 against), Michael E.
McMahon (29,180,851 for and 252,529 against) and J. Otis
Winters, (29,184,496 for and 248,884 against) to serve until the
Annual Meeting of Shareholders in 1996 or until their respective
successors are duly elected and qualified. The following
directors continued in office: Thomas G. Finck, Fitzgerald S.
Hudson, William I. Lee, J.G.A. Tucker, Ernest E. Cook, Wellslake
D. Morse, Jr., Ray H. Eubank, Graeme O. Morris and John P.
Lewis. Also a proposal to adopt the amendments and restatements
of the 1992 Stock Option Plan, the 1986 Convertible Debenture
Plan and the 1985 Restricted Stock Plan of the Company were
passed (15,596,160 for and 4,577,941 against).
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
The following exhibits are filed as part of this Quarterly
Report on Form 10Q:
1. Exhibits required to be filed by Item 601 of Regulation S-K.
(Where the amount of securities authorized to be issued under
or the amount of any of Triton Energy Corporation's
and any of its subsidiaries' or affiliate Crusader's, long-term
debt agreements does not
exceed 10% of the Company's assets, pursuant to paragraph (b)
(4) of Item 601 of Regulation S-K, in lieu of filing such as an
exhibit, the Company hereby agrees to furnish to the Commission
upon request a copy of any agreement with respect to such
long-term debt.)
4.1 Specimen Stock Certificate of Common Stock, $1.00 par value,
of the Company. (1)
4.2 The Company's Restated Articles of Incorporation, and
Amended and Restated Bylaws.(3)
4.3* Amendments to Bylaws.
4.4 Rights Agreement dated as of June 26, 1990, between Triton
and NationsBank of Texas, N.A. (f/k/a NCNB Texas National Bank),
as Rights Agent.(1)
4.5 Statement of Cancellation of Redeemable shares, dated
October 1, 1991.(6)
4.6 Form of Debt Securities.(10)
4.7 Proposed Form of Senior Indenture.(10)
4.8 Proposed Form of Senior Subordinated Indenture.(10).
4.9* Senior Subordinated Indenture by and between the Company
and United States Trust Company of New York, dated as of
December 15, 1993.<PAGE>
4.10* First Supplemental Indenture by and between the Company
and United States Trust Company of New York, dated as of
December 15, 1993.
10.1* Triton Energy Corporation Amended and Restated Retirement
Income Plan.
10.2* Triton Energy Corporation Amended and Restated
Supplemental Executive Retirement Income Plan.
10.3 1981 Employee Non-Qualified Stock Option Plan of Triton
Energy Corporation.(3)
10.4 Amendment No.1 to the 1981 Employee Non-Qualified Stock
Option Plan of Triton Energy Corporation.(5)
10.5 Amendment No.2 to the 1981 Employee Non-Qualified Stock
Option Plan of Triton Energy Corporation.(3)
10.6* Amendment No. 3 to the 1981 Employee Non-Qualified Stock
Option Plan of Triton Energy Corporation.
10.7 1985 Stock Option Plan of Triton Energy Corporation.(1)
10.8 Amendment No.1 to the 1985 Stock Option Plan of Triton
Energy Corporation.(3)
10.9* Amendment No. 2 to the 1985 Stock Option Plan of Triton
Energy Corporation.
10.10* Triton Energy Amended and Restated 1986 Convertible
Debenture Plan.
10.11 1988 Stock Appreciation Rights Plan of Triton Energy
Corporation.(4)
10.12 Triton Energy Corporation 1989 Stock Option Plan.(7)
10.13 Amendment No.1 to the Triton Energy Corporation 1989 Stock
Option Plan.(3)
10.14* Amendment No. 2 to the Triton Energy Corporation 1989
Stock Option Plan.
10.15* Triton Energy Amended and Restated 1992 Stock Option Plan.
10.16* Form of Amended and Restated Employment Agreement by and
among Triton Energy Corporation and certain officers of Triton
Energy Corporation.
10.17* Triton Energy Amended and Restated Restricted Stock Plan.
10.18 Deed of Trust Note dated April 11, 1988, executed by
Triton Aviation Services, Inc. and API Terminal, Inc. and
related documents, including Guaranty of Triton Energy
Corporation .(4)
10.19 Triton Energy Corporation Executive Life Insurance
Plan.(2)<PAGE>
10.20 Triton Energy Corporation Long Term Disability Income
Plan.(2)
10.21 Triton Energy Corporation Amended and Restated Retirement
Plan for Directors.(1)
10.22 Indenture dated as of November 13, 1992 between Triton
and Chemical Bank, with respect to the issuance of Senior
Subordinated Discount Notes due 1997.(8)
10.23 Supplemental Indenture dated as of July 1, 1993 between
Triton Energy Corporation and Chemical Bank.(4)
10.24 Supplemental Indenture dated as of August 16, 1993 between
Triton Energy Corporation and Chemical Bank.(4)
10.25 Underwriting Agreement dated June 18, 1993 among Triton
Canada Resources Ltd., Triton Energy Corporation and the
underwriters named herein.(9)
10.26 Purchase and Sale Agreement among Triton Oil and Gas
Corp., Triton Energy Corporation and Torch Energy Advisors
Incorporated dated effective as of January 1, 1993.(4)
10.27 Agreement for Purchase and Sale of Assets Among Triton
Fuel Group, Inc. and AVFUEL Corporation dated August 25, 1993.(4)
10.28 Contract for Exploration and Exploitation for Tauramena
with an effective date of July 1, 1982, between Triton Colombia,
Inc. , and Empresa Colombiana De Petroleos.(4)
10.29 Contract for Exploration and Exploitation for Tauramena
with an effective date of July 4, 1988, between Triton Colombia,
Inc., and Empresa Colombiana De Petroleos.(4)
10.30 Summary of Assignment legalized by Public Instrument No.
1255 dated September 15, 1987 (Assignment is in Spanish
language).(4)
10.31 Summary of Assignment legalized by Public Instrument No.
1602 dated June 11, 1990 (Assignment is in Spanish language).1(4)
10.32 Summary of Assignment legalized by Public Instrument No.
2586 dated September 9, 1992 (Assignment is in Spanish
language). (4)
10.33* Guaranty between the Company and Comerica Bank-Texas.
10.34* Triton Energy Corporation 401(K) Savings Plan.
15.1* Letter of Price Waterhouse, acknowledging awareness of the
use of their report dated October 13, 1992, relating to the
review of interim financial information.
______________________________
* Filed herewith.
(1) Previously filed as an exhibit to the Company's Annual
Report on Form 10-K for the fiscal year ended May 31, 1990 and
incorporated herein by reference.<PAGE>
(2) Previously filed as an exhibit to the Company's Annual
Report on Form 10-K for the fiscal year ended May 31, 1991 and
incorporated herein by reference.
(3) Previously filed as an exhibit to the Company's Annual
Report on Form 10-K for the fiscal year ended May 31, 1992 and
incorporated herein by reference.
(4) Previously filed as an exhibit to the Company's Annual
Report on Form 10-K for the fiscal year ended May 31, 1993 and
incorporated herein by reference.
(5) Previously filed as an exhibit to the Company's Annual
Report on Form 10-K for the fiscal year ended May 31, 1989 and
incorporated herein by reference.
(6) Previously filed as an exhibit to the Company's Registration
Statement on Form S-3 (No. 33-42430) and incorporated herein by
reference.
(7) Previously filed as an exhibit to the Company's Quarterly
Report on Form 10-Q for the quarter ended November 30, 1988 and
incorporated herein by reference.
(8) Previously filed as an exhibit to the Company's Quarterly
Report on Form 10-Q for the quarter ended November 30, 1992 and
incorporated herein by reference.
(9) Previously filed as an exhibit to the Company's Current
Report on Form 8-K dated as of July 14, 1993 and incorporated
herein by reference.
(10) Previously filed as an exhibit to the Company's
Registration Statement on Form S-3 (No.33-69230) and
incorporated herein by reference.<PAGE>
(b) Reports on Form 8-K
None<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
TRITON ENERGY CORPORATION
/s/Peter Rugg
Peter Rugg
Senior Vice President and
Chief Financial Officer
Date: January 13, 1994
The Bylaws of Triton Energy Corporation are hereby amended by
replacing Article I, Sections 1, 5, 6, 7, 8, 9 and 10 in their
entirety with the following:
AMENDMENTS TO TRITON ENERGY CORPORATION BYLAWS
ARTICLE V
OFFICERS
Section 1. OFFICERS. The officers of the Corporation shall be
chosen by the Board of Directors and may include a Chairman of
the Board and/or a Chief Executive Officer, and shall include a
President, a Vice President, a Secretary and a Treasurer. The
Board of Directors may also choose additional Vice Presidents,
and one or more Assistant Secretaries and Assistant Treasurers.
Two or more offices may be held by the same person. No officer
shall execute, acknowledge, verify or countersign any instrument
on behalf of the Corporation in more than one capacity, if such
instrument is required by law, the Articles of Incorporation,
these Bylaws or any act of the Corporation to be executed,
acknowledged, verified or countersigned by two (2) or more
officers. None of the officers need be a director or a
shareholder of the Corporation.
* * * * *
Section 5. THE CHAIRMAN OF THE BOARD. The Chairman of the
Board (if one be elected and serving) shall preside at all
meetings of the Board at which he may be present and shall
perform such other duties as may be assigned to him by the
Board. He shall preside at all meetings of the shareholders and
Board of Directors unless he shall be absent or unless he shall,
at his option, designate the President to preside in his stead
at some particular meeting.
Section 6. CHIEF EXECUTIVE OFFICER. The Chief Executive
Officer (if one be elected and serving) shall be the ranking and
chief executive officer of the Corporation. As such, he shall
have, subject only to the Board, general and active management
and supervisory powers over the business and affairs of the
Corporation and shall see that all orders and resolutions of the
Board are carried into effect. The Chief Executive Officer
shall have all of the powers granted by the Bylaws to the
President, including the power to make and sign contracts and
agreements in the name and on behalf of the Corporation. He
shall also, in general, have supervisory powers over the
President, the other officers, the executive committees, and the
business activities of the Corporation, subject to the approval
or review of the Board of Directors.
Section 7. THE PRESIDENT. The President shall be the chief
administrative officer of the Corporation. The President may
preside at meetings of the Board of Directors and of the
shareholders and he shall have power to call special meetings of
the shareholders and the directors for any purpose or purposes,
appoint and discharge, subject to the approval or review by the
Chief Executive Officer and the Board of Directors, employees
and agents of the Corporation and fix their compensation, make
and sign contracts and agreements in the name and on behalf of
the Corporation and shall be ex officio a member of all standing
committees. The President shall put into operation such
business policies of the Corporation as shall be decided upon by
the Board and communicated to the President by the Chief
Executive or otherwise. The President shall, if there is no
Chief Executive Officer, or in the absence or disability of the
Chief Executive Officer, be the chief executive officer of the
Corporation, and perform the duties and exercise the powers of
the Chief Executive Officer. He shall see that the books,
reports, statements and certificates required by the statutes
under which the Corporation is organized or any other laws
applicable thereto are properly kept, made and filed according
to law; and he shall generally do and perform all acts incident
to the office of the President or which are authorized or
required by law. The President shall perform such other duties
as from time to time may be assigned to him by the Board of
Directors or the Chief Executive Officer of the Corporation.
Section 8. VICE PRESIDENTS. The Vice Presidents in the order
of their seniority, unless otherwise determined by the Board of
Directors, shall, in the absence or disability of the President,
perform the duties and exercise the powers of the President.
They shall perform such other duties and have such other powers
as the Board of Directors or the Chief Executive Officer may
from time to time prescribe.
Section 9. SECRETARY AND ASSISTANT SECRETARIES. The Secretary
shall attend all meetings of the Board of Directors and all
meetings of the shareholders and record all the proceedings of
the meetings of the Corporation and of the Board of Directors in
a book to be kept for that purpose and shall perform like duties
for any committees when required. The Secretary shall give, or
cause to be given, notice of all meetings of the shareholders
and special meetings of the Board of Directors, and shall
perform such other duties as may be prescribed by the Board of
Directors or the Chief Executive Officer, under whose
supervision the Secretary shall be. The Secretary shall keep in
safe custody the seal of the Corporation and, when authorized by
the Board of Directors, affix the same to any instrument
requiring it and, when so affixed, it shall be attested by
signature or by the signature of the Treasurer or an Assistant
Secretary. The Secretary also shall perform such other duties
and have such other powers as may be permitted by law or as the
Board of Directors or the Chief Executive Officer may from time
to time prescribe or authorize.
The Assistant Secretaries in the order of their seniority,
unless otherwise determined by the Board of Directors or the
Chief Executive Officer, shall, in the absence or disability of
the Secretary, perform the duties and exercise the powers of the
Secretary. They shall perform such other duties and have such
other powers as the Board of Directors may from time to time
prescribe. In the absence of the Secretary or an Assistant
Secretary, the minutes of all meetings of the Board of Directors
and of shareholders shall be recorded by such person as shall be
designated by the Board of Directors.
Section 10. TREASURER AND ASSISTANT TREASURERS. If a
Treasurer is designated as an officer of the Corporation by the
Board of Directors, the Treasurer shall have the custody of the
corporate funds and securities and shall keep, or cause to be
kept, full and accurate accounts and records of receipts and
disbursements and other transactions in books belonging to the
Corporation and shall deposit, or see to the deposit of, all
moneys and other valuable effects in the name and to the credit
of the Corporation in such depositories as may be designated by
the Board of Directors. The Treasurer shall: (a) endorse or
cause to be endorsed in the name of the Corporation for
collection the bills, notes, checks or other negotiable
instruments received by the Corporation; (b) sign or cause to be
signed all checks issued by the Corporation; and (c) pay out or
cause to be paid out money as the Corporation may require,
taking vouchers therefor. In addition, he shall perform such
other duties as may be permitted by law or as the Board of
Directors or the Chief Executive Officer may from time to time
prescribe, authorize or delegate. The Board of Directors may by
resolution delegate, with or without power to re-delegate, any
or all of the foregoing duties of the Treasurer to other
officers, employees or agents of the Corporation, and provide
that other officers, employees and agents shall have the power
to sign checks, vouchers, orders or other instruments on behalf
of the Corporation. The Treasurer shall render the Chief
Executive Officer and the Board of Directors, whenever they may
require it, an account of his transactions as Treasurer and of
the financial condition of the Corporation. If required by the
Board of Directors, he shall give the Corporation a bond of such
type, character and amount as the Board of Directors may require.
If a Treasurer is not designated as an officer of the
Corporation, the functions of the Treasurer shall be performed
by the Chief Executive Officer, the President, the Secretary or
such other officer or officers of the Corporation as shall be
designated by the Board of Directors at any time or from time to
time.
The Assistant Treasurers in the order of their seniority,
unless otherwise determined by the Board of Directors or the
Chief Executive Officer, shall, in the absence or disability of
the Treasurer, perform the duties and exercise the powers of the
Treasurer and shall perform such other duties and have such
other powers as may be permitted by law or as the Board of
Directors or the Chief Executive Officer may from time to time
prescribe, authorize or delegate. If required by the Board of
Directors, the Assistant Treasurers shall give the Corporation a
bond of such type, character and amount as the Board of
Directors may require.
By Order of the Board of Directors
\\Robert B. Holland, III
----------------------------------
Robert B. Holland, III, Secretary
TRITON ENERGY CORPORATION
AND
UNITED STATES TRUST COMPANY OF NEW YORK
as Trustee
Senior Subordinated Indenture
Dated as of December 15, 1993
CROSS REFERENCE SHEET
_______________
Provisions of Trust Indenture Act of 1939 and Indenture to be
dated as of December 15, 1993 between TRITON ENERGY CORPORATION and
UNITED STATES TRUST COMPANY OF NEW YORK, Trustee:
Section of the Act Section of Indenture
310(a)(1), (2) and (5) . . . . . . . . . 6.9
310(a)(3) and (4). . . . . . . . . . . . Inapplicable
310(b) . . . . . . . . . . . . . . . . . 6.8 and 6.10(a), (b)
and (d)
310(c) . . . . . . . . . . . . . . . . . Inapplicable
311(a) . . . . . . . . . . . . . . . . . 6.13
311(b) . . . . . . . . . . . . . . . . . 6.13
311(c) . . . . . . . . . . . . . . . . . Inapplicable
312(a) . . . . . . . . . . . . . . . . . 4.1 and 4.2(a)
312(b) . . . . . . . . . . . . . . . . . 4.2(a) and (b)(i)
and (ii)
312(c) . . . . . . . . . . . . . . . . . 4.2(c)
313(a) . . . . . . . . . . . . . . . . . 4.4(a)(i), (ii),
(iii), (iv), (v),
(vi) and (vii)
313(a)(5). . . . . . . . . . . . . . . . Inapplicable
313(b)(1). . . . . . . . . . . . . . . . Inapplicable
313(b)(2). . . . . . . . . . . . . . . . 4.4(b)
313(c) . . . . . . . . . . . . . . . . . 4.4(c)
313(d) . . . . . . . . . . . . . . . . . 4.4(d)
314(a) . . . . . . . . . . . . . . . . . 4.3
314(b) . . . . . . . . . . . . . . . . . Inapplicable
314(c)(1) and (2). . . . . . . . . . . . 11.5
314(c)(3). . . . . . . . . . . . . . . . Inapplicable
314(d) . . . . . . . . . . . . . . . . . Inapplicable
314(e) . . . . . . . . . . . . . . . . . 11.5
314(f) . . . . . . . . . . . . . . . . . Inapplicable
315(a), (c) and (d). . . . . . . . . . . 6.1
315(b) . . . . . . . . . . . . . . . . . 5.8
315(e) . . . . . . . . . . . . . . . . . 5.9
316(a)(1). . . . . . . . . . . . . . . . 5.7
316(a)(2). . . . . . . . . . . . . . . . Not required
316(a) (last sentence) . . . . . . . . . 7.4
316(b) . . . . . . . . . . . . . . . . . 5.4
317(a) . . . . . . . . . . . . . . . . . 5.2
317(b) . . . . . . . . . . . . . . . . . 3.5(a)
318(a) . . . . . . . . . . . . . . . . . 11.7
TABLE OF CONTENTS
ARTICLE ONE
DEFINITIONS
Affiliate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Authenticating Agent. . . . . . . . . . . . . . . . . . . . . . . . 2
Bankruptcy Code . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Board of Directors. . . . . . . . . . . . . . . . . . . . . . . . . 2
Board Resolution. . . . . . . . . . . . . . . . . . . . . . . . . . 2
Business Day. . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Commission. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Consolidated Net Tangible Assets. . . . . . . . . . . . . . . . . . 2
Corporate Trust Office. . . . . . . . . . . . . . . . . . . . . . . 3
Depositary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Dollars . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Exchange Act. . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Event of Default. . . . . . . . . . . . . . . . . . . . . . . . . . 3
Global Security . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Holder. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Holder of Securities. . . . . . . . . . . . . . . . . . . . . . . . 3
Securityholder. . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Issuer. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Issuer Order. . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Officers' Certificate . . . . . . . . . . . . . . . . . . . . . . . 4
Opinion of Counsel. . . . . . . . . . . . . . . . . . . . . . . . . 5
original issue date . . . . . . . . . . . . . . . . . . . . . . . . 5
original issue discount . . . . . . . . . . . . . . . . . . . . . . 5
Original Issue Discount Security. . . . . . . . . . . . . . . . . . 5
Outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Periodic Offering . . . . . . . . . . . . . . . . . . . . . . . . . 6
Person. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Place of Payment. . . . . . . . . . . . . . . . . . . . . . . . . . 6
principal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
principal amount. . . . . . . . . . . . . . . . . . . . . . . . . . 6
record date . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Responsible Officer . . . . . . . . . . . . . . . . . . . . . . . . 7
Restricted Subsidiary . . . . . . . . . . . . . . . . . . . . . . . 7
Securities Act. . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Security. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Senior Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . 7
Senior Subordinated Indebtedness. . . . . . . . . . . . . . . . . . 7
Subordinated Indebtedness . . . . . . . . . . . . . . . . . . . . . 7
Subsidiary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Trust Indenture Act of 1939 . . . . . . . . . . . . . . . . . . . . 8
Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Unrestricted Subsidiary . . . . . . . . . . . . . . . . . . . . . . 8
U.S. Government Obligations . . . . . . . . . . . . . . . . . . . . 8
vice president. . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Yield to Maturity . . . . . . . . . . . . . . . . . . . . . . . . . 8
ARTICLE TWO
SECURITIES
SECTION 2.1 Forms Generally . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 2.2 Form of Trustee's Certificate of Authentication . . . . . . 9
SECTION 2.3 Amount Unlimited Issuable in Series. . . . . . . . . . . . 10
SECTION 2.4 Authentication and Delivery of Securities. . . . . . . . . 12
SECTION 2.5 Execution of Securities. . . . . . . . . . . . . . . . . . 15
SECTION 2.6 Certificate of Authentication. . . . . . . . . . . . . . . 16
SECTION 2.7 Denomination and Date of Securities; Payments
of Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 2.8 Registration, Transfer and Exchange. . . . . . . . . . . . 17
SECTION 2.9 Mutilated, Defaced, Destroyed, Lost and
Stolen Securities . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 2.10 Cancellation of Securities; Disposition
Thereof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 2.11 Temporary Securities. . . . . . . . . . . . . . . . . 20
SECTION 2.12 CUSIP Numbers . . . . . . . . . . . . . . . . . . . . 21
ARTICLE THREE
COVENANTS OF THE ISSUER
SECTION 3.1 Payment of Principal and Interest. . . . . . . . . . . . . 21
SECTION 3.2 Offices for Notices and Payments, etc. . . . . . . . . . . 21
SECTION 3.3 No Interest Extension. . . . . . . . . . . . . . . . . . . 21
SECTION 3.4 Appointments to Fill Vacancies in Trustee's
Office. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 3.5 Provision as to Paying Agent . . . . . . . . . . . . . . . 22
ARTICLE FOUR
SECURITYHOLDERS LISTS AND REPORTS BY THE
ISSUER AND THE TRUSTEE
SECTION 4.1 Issuer to Furnish Trustee Information as to
Names
and Addresses of Securityholders. . . . . . . . . . . . . . 23
SECTION 4.2 Preservation and Disclosure of
Securityholders Lists. . . . . . . . . . . . . . . . . . . 23
SECTION 4.3 Reports by the Issuer. . . . . . . . . . . . . . . . . . . 24
SECTION 4.4 Reports by the Trustee . . . . . . . . . . . . . . . . . . 25
ARTICLE FIVE
REMEDIES OF THE TRUSTEE AND SECURITY HOLDERS
ON EVENT OF DEFAULT
SECTION 5.1 Events of Default. . . . . . . . . . . . . . . . . . . . . 27
SECTION 5.2 Payment of Securities on Default; Suit
Therefor. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 5.3 Application of Moneys Collected by Trustee . . . . . . . . 31
SECTION 5.4 Proceedings by Securityholders . . . . . . . . . . . . . . 32
SECTION 5.5 Proceedings by Trustee . . . . . . . . . . . . . . . . . . 32
SECTION 5.6 Remedies Cumulative and Continuing . . . . . . . . . . . . 33
SECTION 5.7 Direction of Proceedings; Waiver of Defaults
by
Majority of Securityholders . . . . . . . . . . . . . . . . 33
SECTION 5.8 Notice of Defaults . . . . . . . . . . . . . . . . . . . . 33
SECTION 5.9 Undertaking to Pay Costs . . . . . . . . . . . . . . . . . 34
ARTICLE SIX
CONCERNING THE TRUSTEE
SECTION 6.1 Duties and Responsibilities of the Trustee;
During
Default; Prior to Default . . . . . . . . . . . . . . . . . 34
SECTION 6.2 Certain Rights of the Trustee. . . . . . . . . . . . . . . 36
SECTION 6.3 Trustee Not Responsible for Recitals,
Disposition of
Securities or Application of Proceeds Thereof . . . . . . . 37
SECTION 6.4 Trustee and Agents May Hold Securities;
Collections, etc. . . . . . . . . . . . . . . . . . . . . . 37
SECTION 6.5 Moneys Held by Trustee . . . . . . . . . . . . . . . . . . 37
SECTION 6.6 Compensation and Indemnification of Trustee
and Its
Prior Claim . . . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 6.7 Right of Trustee to Rely on Officers'
Certificate, etc. . . . . . . . . . . . . . . . . . . . . 38
SECTION 6.8 Qualification of Trustee; Conflicting
Interests. . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 6.9 Persons Eligible for Appointment as Trustee;
Different
Trustees for Different Series . . . . . . . . . . . . . . . 39
SECTION 6.10
Resignation and Removal; Appointment of
Successor Trustee . . . . . . . . . . . . . . . . . . . . . 39
SECTION 6.11
Acceptance of Appointment by Successor Trustee. . . . . . . 41
SECTION 6.12
Merger, Conversion, Consolidation or Succession
to
Business of Trustee . . . . . . . . . . . . . . . . . . . . 42
SECTION 6.13
Preferential Collection of Claims Against the
Issuer. . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 6.14
Appointment of Authenticating Agent . . . . . . . . . . . . 42
ARTICLE SEVEN
CONCERNING THE SECURITYHOLDERS
SECTION 7.1 Evidence of Action Taken by Securityholders. . . . . . . . 43
SECTION 7.2 Proof of Execution of Instruments and of
Holding
of Securities . . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 7.3 Holders to be Treated as Owners. . . . . . . . . . . . . . 44
SECTION 7.4 Securities Owned by Issuer Deemed Not
Outstanding. . . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 7.5 Right of Revocation of Action Taken. . . . . . . . . . . . 45
SECTION 7.6 Record Date for Consents and Waivers . . . . . . . . . . . 45
ARTICLE EIGHT
SUPPLEMENTAL INDENTURES
SECTION 8.1 Supplemental Indentures Without Consent of
Securityholders . . . . . . . . . . . . . . . . . . . . . . 46
SECTION 8.2 Supplemental Indentures with Consent of
Securityholders. . . . . . . . . . . . . . . . . . . . . . 48
SECTION 8.3 Effect of Supplemental Indenture . . . . . . . . . . . . . 49
SECTION 8.4 Documents to Be Given to Trustee . . . . . . . . . . . . . 49
SECTION 8.5 Notation on Securities in Respect of
Supplemental
Indentures. . . . . . . . . . . . . . . . . . . . . . . . . 49
ARTICLE NINE
CONSOLIDATION, MERGER, SALE, LEASE, EXCHANGE OR OTHER DISPOSITION
SECTION 9.1 Issuer May Consolidate, etc., on Certain
Terms. . . . . . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 9.2 Successor Corporation to be Substituted. . . . . . . . . . 50
SECTION 9.3 Opinion of Counsel to be Given Trustee . . . . . . . . . . 51
ARTICLE TEN
SATISFACTION AND DISCHARGE OF INDENTURE;
COVENANT DEFEASANCE; UNCLAIMED MONEYS
SECTION 10.1
Satisfaction and Discharge of Indenture . . . . . . . . . . 51
SECTION 10.2
Application by Trustee of Funds Deposited for
Payment of Securities . . . . . . . . . . . . . . . . . . . 54
SECTION 10.3
Repayment of Moneys Held by Paying Agent. . . . . . . . . . 54
SECTION 10.4
Return of Moneys Held by Trustee and Paying
Agent
Unclaimed for Two Years . . . . . . . . . . . . . . . . . . 54
SECTION 10.5
Indemnity for U.S. Government Obligations . . . . . . . . . 55
ARTICLE ELEVEN
MISCELLANEOUS PROVISIONS
SECTION 11.1
Partners, Incorporators, Stockholders, Officers
and
Directors of Issuer Exempt from Individual Liability. . . . 55
SECTION 11.2
Provisions of Indenture for the Sole Benefit of
Parties
and Holders of Securities . . . . . . . . . . . . . . . . . 55
SECTION 11.3 Successors and Assigns of Issuer Bound by
Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
SECTION 11.4 Notices and Demands on Issuer, Trustee and
Holders
of Securities . . . . . . . . . . . . . . . . . . . . . . . 55
SECTION 11.5 Officers' Certificates and Opinions of
Counsel; Statements
to Be Contained Therein . . . . . . . . . . . . . . . . . . 56
SECTION 11.6 Payments Due on Saturdays, Sundays and
Holidays. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 11.7 Conflict of Any Provision of Indenture with
Trust Indenture
Act of 1939 . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 11.8 GOVERNING LAW . . . . . . . . . . . . . . . . . . . . 57
SECTION 11.9 Counterparts. . . . . . . . . . . . . . . . . . . . . 58
SECTION 11.10 Effect of Headings. . . . . . . . . . . . . . . . . . 58
ARTICLE TWELVE
REDEMPTION OF SECURITIES AND SINKING FUNDS
SECTION 12.1 Applicability of Article. . . . . . . . . . . . . . . 58
SECTION 12.2 Notice of Redemption; Partial Redemptions . . . . . . 58
SECTION 12.3 Payment of Securities Called for Redemption . . . . . 59
SECTION 12.4 Exclusion of Certain Securities from
Eligibility for
Selection for Redemption. . . . . . . . . . . . . . . . . . 60
SECTION 12.5 Mandatory and Optional Sinking Funds. . . . . . . . . 60
ARTICLE THIRTEEN
SUBORDINATION
SECTION 13.1 Securities Subordinated to Senior Indebtedness. . . . 62
SECTION 13.2 Reliance on Certificate of Liquidating Agent;
Further
Evidence as to Ownership of Senior Indebtedness . . . . . . 65
SECTION 13.3 Payment Permitted If No Default . . . . . . . . . . . 66
SECTION 13.4
Disputes with Holders of Certain Senior
Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . 66
SECTION 13.5
Trustee Not Charged with Knowledge of
Prohibition . . . . . . . . . . . . . . . . . . . . . . . . 67
SECTION 13.6
Trustee to Effectuate Subordination . . . . . . . . . . . . 67
SECTION 13.7
Rights of Trustee as Holder of Senior
Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . 67
SECTION 13.8
Article Applicable to Paying Agents . . . . . . . . . . . . 68
SECTION 13.9
Subordination Rights Not Impaired by Acts or
Omissions of
the Issuer or Holders of Senior Indebtedness. . . . . . . . 68
SECTION 13.10
Trustee Not Fiduciary for Holders of Senior
Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . 68
THIS SENIOR SUBORDINATED INDENTURE, dated as of
December 15, 1993 between TRITON ENERGY CORPORATION, a Texas
corporation (the "Issuer"), and UNITED STATES TRUST COMPANY OF
NEW YORK, a New York corporation as trustee (the "Trustee").
W I T N E S S E T H :
WHEREAS, the Issuer has duly authorized the issuance
from time to time of its unsecured senior subordinated
debentures, notes or other evidences of indebtedness to be issued
in one or more series (the "Securities") up to such principal
amount or amounts as may from time to time be authorized in
accordance with the terms of this Indenture;
WHEREAS, the Issuer has duly authorized the
execution and delivery of this Indenture to provide, among other
things, for the authentication, delivery and administration of
the Securities; and
WHEREAS, all things necessary to make this Indenture
a valid indenture and agreement according to its terms have been
undertaken and completed;
NOW, THEREFORE:
In consideration of the premises and the purchases
of the Securities by the Holders (as hereinafter defined)
thereof, the Issuer and the Trustee mutually covenant and agree
for the equal and proportionate benefit of the respective Holders
from time to time of the Securities as follows:
ARTICLE ONE
DEFINITIONS
SECTION 1.1 For all purposes of this Indenture and
of any indenture supplemental hereto the following terms shall
have the respective meanings specified in this Section 1.1
(except as otherwise expressly provided herein or in any
indenture supplemental hereto or unless the context otherwise
clearly requires). All other terms used in this Indenture that
are defined in the Trust Indenture Act of 1939, including terms
defined therein by reference to the Securities Act of 1933, as
amended (the "Securities Act"), shall have the meanings assigned
to such terms in said Trust Indenture Act of 1939 and in said
Securities Act as in force at the date of this Indenture (except
as otherwise expressly provided herein or in any indenture
supplemental hereto or unless the context otherwise clearly
requires).
All accounting terms used herein and not expressly
defined shall have the meanings assigned to such terms in
accordance with generally accepted accounting principles, and the
term "generally accepted accounting principles" means such
accounting principles as are generally accepted at the time of
any computation.
The words "herein", "hereof" and "hereunder" and
other words of similar import refer to this Indenture as a whole
and not to any particular Article, Section or other subdivision.
The expressions "date of this Indenture", "date hereof", "date as
of which this Indenture is dated" and "date of execution and
delivery of this Indenture" and other expressions of similar
import refer to the effective date of the original execution and
delivery of this Indenture, viz. as of December 15, 1993.
The terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well
as the singular.
"Affiliate" of any specified Person means any other
Person directly or indirectly controlling or controlled by or
under direct or indirect common control with such specified
Person. For the purposes of this definition, "control" when used
with respect to any specified Person means the power to direct
the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities,
by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Authenticating Agent" shall have the meaning set
forth in Section 6.14.
"Bankruptcy Code" means the United States Bankruptcy
Code, 11 United States Code 101 et seq., or any successor
statute thereto.
"Board of Directors" means either the Board of
Directors of the Issuer or any committee of such Board duly
authorized to act on its behalf.
"Board Resolution" means one or more resolutions,
certified by the secretary or an assistant secretary of the
Issuer to have been duly adopted or consented to by the Board of
Directors and to be in full force and effect, and delivered to
the Trustee.
"Business Day" means, with respect to any Security,
unless otherwise specified in a Board Resolution and an Officers
Certificate with respect to a particular series of Securities, a
day that (a) in the Place of Payment (or in any of the Places of
Payment, if more than one) in which amounts are payable, as
specified in the form of such Security, and (b) in the city in
which the Corporate Trust Office is located, is not a day on
which banking institutions are authorized or required by law or
regulation to close.
"Commission" means the Securities and Exchange
Commission, as from time to time constituted, created under the
Securities Exchange Act of 1934, as amended, or, if at any time
after the execution and delivery of this Indenture such
Commission is not existing and performing the duties now assigned
to it under the Trust Indenture Act of 1939, then the body
performing such duties on such date.
"Consolidated Net Tangible Assets" means the
aggregate amount of assets included on the most recent
consolidated balance sheet of the Issuer and its Restricted
Subsidiaries, less applicable reserves and other properly
deductible items and after deducting therefrom (a) all current
liabilities and (b) all goodwill, trade names, trademarks,
patents, unamortized debt discount and expense and other like
intangibles, all in accordance with generally accepted accounting
principles consistently applied.
"Corporate Trust Office" means the office of the
Trustee at which the corporate trust business of the Trustee
shall, at any particular time, be principally administered, which
office is, at the date as of which this Indenture is dated,
located in New York, New York.
"Depositary" means, with respect to the Securities
of any series issuable or issued in the form of one or more
Global Securities, the Person designated as Depositary by the
Issuer pursuant to Section 2.3 until a successor Depositary shall
have become such pursuant to the applicable provisions of this
Indenture, and thereafter "Depositary" shall mean or include each
Person who is then a Depositary hereunder, and, if at any time
there is more than one such Person, "Depositary" as used with
respect to the Securities of any such series shall mean the
Depositary with respect to the Global Securities of such series.
"Dollars" and the sign "$" means the coin and
currency of the United States of America as at the time of
payment is legal tender for the payment of public and private
debts.
"Exchange Act" means the Securities Exchange Act of
1934, as amended.
"Event of Default" means any event or condition
specified as such in Section 5.1.
"Global Security" means a Security evidencing all or
a part of a series of Securities issued to the Depositary for
such series in accordance with Section 2.3 and bearing the legend
prescribed in Section 2.4.
"Holder", "Holder of Securities", "Securityholder"
or other similar terms mean, in the case of any Security, the
Person in whose name such Security is registered in the security
register kept by the Issuer for that purpose in accordance with
the terms hereof.
"Indebtedness" with respect to any Person, means,
without duplication:
(a) (i) the principal of and premium, if any,
and interest, if any, on indebtedness for money
borrowed of such Person, indebtedness of such Person
evidenced by bonds, notes, debentures or similar
obligations, and any guaranty by such Person of any
indebtedness for money borrowed or indebtedness
evidenced by bonds, notes, debentures or similar
obligations of any other Person, whether any such
indebtedness or guaranty is outstanding on the date
of this Indenture or is thereafter created, assumed
or incurred, (ii) the principal of and premium, if
any, and interest, if any, on indebtedness incurred,
assumed or guaranteed by such Person in connection
with the acquisition by it or any of its
subsidiaries of any other businesses, properties or
other assets and (iii) lease obligations which such
Person capitalizes in accordance with Statement of
Financial Accounting Standards No. 13 promulgated by
the Financial Accounting Standards Board or such
other generally accepted accounting principles as
may be from time to time in effect;
(b) any other indebtedness of such Person,
including any indebtedness representing the balance
deferred and unpaid of the purchase price of any
property or interest therein, and any guaranty,
endorsement or other contingent obligation of such
Person in respect of any indebtedness of another
that is outstanding on the date of this Indenture or
is thereafter created, assumed or incurred by such
Person;
(c) obligations of such Person under interest
rate, commodity or currency swaps, caps, collars,
options and similar arrangements;
(d) obligations of such Person for the
reimbursement of any obligor on any letter of
credit, banker's acceptance or similar credit
transaction; and
(e) any amendments, modifications, refundings,
renewals or extensions of any indebtedness or
obligation described as Indebtedness in clauses (a)
through (d) above.
"Indenture" means this instrument as originally
executed and delivered or, if amended or supplemented as herein
provided, as so amended or supplemented or both, including, for
all purposes of this instrument and any such supplement, the
provisions of the Trust Indenture Act of 1939 that are deemed to
be a part of and govern this instrument and any such supplement,
respectively, and shall include the forms and terms of particular
series of Securities established as contemplated hereunder.
"interest" means, when used with respect to non-
interest bearing Securities (including, without limitation, any
Original Issue Discount Security that by its terms bears interest
only after maturity or upon default in any other payment due on
such Security), interest payable after maturity (whether at
stated maturity, upon acceleration or redemption or otherwise) or
after the date, if any, on which the Issuer becomes obligated to
acquire a Security, whether upon conversion, by purchase or
otherwise.
"Issuer" means Triton Energy Corporation, a Texas
corporation, and, subject to Article Nine, its successors and
assigns.
"Issuer Order" means a written statement, request or
order of the Issuer which is signed in its name by the chairman
of the Board of Directors, the president or any vice president of
the Issuer, and delivered to the Trustee.
"Officers' Certificate", when used with respect to
the Issuer, means a certificate signed by the chairman of the
Board of Directors, the president, or any vice president and by
the treasurer, any assistant treasurer, the controller, any
assistant controller, the secretary or any assistant secretary of
the Issuer. Each such certificate shall include the statements
provided for in Section 11.5 if and to the extent required by the
provisions of such Section 11.5. One of the officers signing an
Officers' Certificate given pursuant to Section 4.3 shall be the
principal executive, financial or accounting officer of the
Issuer.
"Opinion of Counsel" means an opinion in writing
signed by the chief counsel of the Issuer or by such other legal
counsel who may be an employee of or counsel to the Issuer and
who shall be reasonably satisfactory to the Trustee. Each such
opinion shall include the statements provided for in Section
11.5, if and to the extent required by the provisions of such
Section 11.5.
"original issue date" of any Security (or portion
thereof) means the earlier of (a) the date of such Security or
(b) the date of any Security (or portion thereof) for which such
Security was issued (directly or indirectly) on registration of
transfer, exchange or substitution.
"original issue discount" of any debt security,
including any Original Issue Discount Security, means the
difference between the principal amount of such debt security and
the initial issue price of such debt security (as set forth in
the case of an Original Issue Discount Security on the face of
such Security).
"Original Issue Discount Security" means any
Security that provides for an amount less than the principal
amount thereof to be due and payable upon a declaration of
acceleration of the maturity thereof pursuant to Article Five.
"Outstanding" when used with reference to
Securities, shall, subject to the provisions of Section 7.4,
mean, as of any particular time, all Securities authenticated and
delivered by the Trustee under this Indenture, except:
(a) Securities theretofore cancelled by the Trustee
or delivered to the Trustee for cancellation;
(b) Securities (other than Securities of any series
as to which the provisions of Article Ten hereof shall not
be applicable), or portions thereof, for the payment or
redemption of which moneys or U.S. Government Obligations
(as provided for in Section 10.1) in the necessary amount
shall have been deposited in trust with the Trustee or with
any paying agent (other than the Issuer) or shall have been
set aside, segregated and held in trust by the Issuer for
the Holders of such Securities (if the Issuer shall act as
its own paying agent), provided that, if such Securities, or
portions thereof, are to be redeemed prior to the maturity
thereof, notice of such redemption shall have been given as
herein provided, or provision satisfactory to the Trustee
shall have been made for giving such notice; and
(c) Securities which shall have been paid or in
substitution for which other Securities shall have been
authenticated and delivered pursuant to the terms of Section
2.9 (except with respect to any such Security as to which
proof satisfactory to the Trustee is presented that such
Security is held by a Person in whose hands such Security is
a legal, valid and binding obligation of the Issuer).
In determining whether the Holders of the requisite
aggregate principal amount of Outstanding Securities of any or
all series have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, the principal
amount of an Original Issue Discount Security that shall be
deemed to be Outstanding for such purposes shall be the portion
of the principal amount thereof that would be due and payable as
of the date of such determination (as certified by the Issuer to
the Trustee) upon a declaration of acceleration of the maturity
thereof pursuant to Article Five.
"Periodic Offering" means an offering of Securities
of a series from time to time, the specific terms of which
Securities, including, without limitation, the rate or rates of
interest, if any, thereon, the stated maturity or maturities
thereof and the redemption provisions, if any, with respect
thereto, are to be determined by the Issuer or its agents upon
the issuance of such Securities.
"Person" means any individual, corporation, limited
liability company, partnership, joint venture, association, joint
stock company, trust, estate, unincorporated organization or
government or any agency or political subdivision thereof.
"Place of Payment", when used with respect to the
Securities of any series, means the place or places where the
principal of and interest, if any, on the Securities of such
series are payable as determined in accordance with Section 2.3.
"principal" of a debt security, including any
Security, means the amount (including, without limitation, if and
to the extent applicable, any premium and, in the case of an
Original Issue Discount Security, any accrued original issue
discount, but excluding interest) that is payable with respect to
such debt security as of any date and for any purpose (including,
without limitation, in connection with any sinking fund, if any,
upon any redemption at the option of the Issuer, upon any
purchase or exchange at the option of the Issuer or the holder of
such debt security and upon any acceleration of the maturity of
such debt security).
"principal amount" of a debt security, including any
Security, means the principal amount as set forth on the face of
such debt security.
"record date" shall have the meaning set forth in
Section 2.7.
"Responsible Officer", when used with respect to the
Trustee, means any officer of the Trustee with direct
responsibility for the administration of this Indenture.
"Restricted Subsidiary" means (a) any Subsidiary
other than an Unrestricted Subsidiary, and (b) any Subsidiary
which was an Unrestricted Subsidiary but which, subsequent to the
date hereof, is designated by the Issuer (by Board Resolution) to
be a Restricted Subsidiary; provided, however, that the Issuer
may not designate any such Subsidiary to be a Restricted
Subsidiary if the Issuer would thereby breach any covenant or
agreement herein contained (on the assumptions that any
outstanding Indebtedness of such Subsidiary was incurred at the
time of such designation).
"Securities Act" shall have the meaning set forth in
Section 1.1.
"Security" or "Securities" has the meaning stated in
the first recital of this Indenture or, as the case may be,
Securities that have been authenticated and delivered pursuant to
this Indenture.
"Senior Indebtedness" means Indebtedness of the
Issuer outstanding at any time except (a) any Indebtedness as to
which, by the terms of the instrument creating or evidencing the
same, it is provided that such Indebtedness is not senior in
right of payment to the Securities, (b) the Securities, (c) any
Indebtedness of the Issuer to a wholly-owned Subsidiary of the
Issuer, (d) interest accruing after the filing of a petition
initiating any proceeding referred to in Sections 5.1(e) and
5.1(f) unless such interest is an allowed claim enforceable
against the Issuer in a proceeding under federal or state
bankruptcy laws and (e) trade payables.
"Senior Subordinated Indebtedness" means the
Securities and any other Indebtedness of the Issuer that ranks
pari passu with the Securities. Any Indebtedness of the Issuer
that is subordinate or junior by its terms in right of payment to
any other Indebtedness of the Issuer shall be subordinate to
Senior Subordinated Indebtedness unless the instrument creating
or evidencing the same or pursuant to which the same is
outstanding specifically provides that such Indebtedness (i) is
to rank pari passu with other Senior Subordinated Indebtedness
and (ii) is not subordinated by its terms to any Indebtedness of
the Issuer which is not Senior Indebtedness.
"Subordinated Indebtedness" means the Securities,
any other Senior Subordinated Indebtedness and any other
Indebtedness that is subordinate or junior in right of payment to
Senior Indebtedness.
"Subsidiary" means any corporation of which the
Issuer, or the Issuer and one or more Subsidiaries, or any one or
more Subsidiaries, directly or indirectly own voting securities
entitling any one or more of the Issuer and its Subsidiaries to
elect a majority of the directors, either at all times or, so
long as there is no default or contingency which permits the
holders of any other class or classes of securities to vote for
the election of one or more directors.
"Trust Indenture Act of 1939" (except as otherwise
provided in Sections 8.1 and 8.2) means the Trust Indenture Act
of 1939, as amended by the Trust Indenture Reform Act of 1990, as
in force at the date as of which this Indenture is originally
executed.
"Trustee" means the Person identified as "Trustee"
in the first paragraph hereof and, subject to the provisions of
Article Six, shall also include any successor trustee. "Trustee"
shall also mean or include each Person who is then a trustee
hereunder and, if at any time there is more than one such Person,
"Trustee" as used with respect to the Securities of any series
shall mean the trustee with respect to the Securities of such
series.
"Unrestricted Subsidiary" means (a) any Subsidiary
acquired or organized after the date hereof, provided, however,
that such Subsidiary shall not be a successor, directly or
indirectly, to any Restricted Subsidiary, and (b) any Subsidiary
substantially all the assets of which consist of stock or other
securities of a Subsidiary or Subsidiaries of the character
described in clause (a) of this paragraph, unless and until such
Subsidiary shall have been designated to be a Restricted
Subsidiary pursuant to clause (b) of the definition of
"Restricted Subsidiary".
"U.S. Government Obligations" shall have the meaning
set forth in Section 10.1(B).
"vice president," when used with respect to the
Issuer or the Trustee, means any vice president, regardless of
whether designated by a number or a word or words added before or
after the title "vice president."
"Yield to Maturity" means the yield to maturity on a
series of Securities, calculated at the time of issuance of such
series, or, if applicable, at the most recent redetermination of
interest on such series, and calculated in accordance with
generally accepted financial practice or as otherwise provided in
the terms of such series of Securities.
ARTICLE TWO
SECURITIES
SECTION 2.1 Forms Generally. The Securities of
each series shall be substantially in such form (not inconsistent
with this Indenture) as shall be established by or pursuant to
one or more Board Resolutions (as set forth in a Board Resolution
or, to the extent established pursuant to rather than set forth
in a Board Resolution, an Officers' Certificate detailing such
establishment) or in one or more indentures supplemental hereto,
in each case with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted
by this Indenture, and may have imprinted or otherwise reproduced
thereon such legend or legends or endorsements, not inconsistent
with the provisions of this Indenture, as may be required to
comply with any law or with any rules or regulations pursuant
thereto, or with any rules of any securities exchange or to
conform to general usage, all as may be determined by the
officers executing such Securities, as evidenced by their
execution of such Securities.
The definitive Securities shall be printed,
lithographed or engraved on steel engraved borders or may be
produced in any other manner, all as determined by the officers
executing such Securities as evidenced by their execution of such
Securities.
SECTION 2.2 Form of Trustee's Certificate of
Authentication. The Trustee's certificate of authentication on
all Securities shall be substantially as follows:
This is one of the Securities of the series
designated herein referred to in the within mentioned Indenture.
UNITED STATES TRUST COMPANY OF NEW
YORK, as Trustee
By______________________________
Authorized Signatory
If at any time there shall be an Authenticating
Agent appointed with respect to any series of Securities, then
the Securities of such series shall bear, in addition to the
Trustee's certificate of authentication, an alternate Certificate
of Authentication which shall be substantially as follows:
This is one of the Securities of the series designated
herein referred to in the within mentioned Indenture.
UNITED STATES TRUST COMPANY OF NEW
YORK, as Trustee
By______________________________
as Authenticating Agent
By______________________________
Authorized Signatory
SECTION 2.3 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
and the Securities of each such series shall rank equally and
pari passu with the Securities of each other series, but all
Securities issued hereunder shall be subordinate and junior in
right of payment, to the extent and in the manner set forth in
Article Thirteen, to all Senior Indebtedness. There shall be
established in or pursuant to one or more Board Resolutions (and,
to the extent established pursuant to rather than set forth in a
Board Resolution, in an Officers' Certificate detailing such
establishment) or established in one or more indentures
supplemental hereto, prior to the initial issuance of Securities
of any series:
(1) the designation of the Securities of the
series, which shall distinguish the Securities of such
series from the Securities of all other series;
(2) any limit upon the aggregate principal amount
of the Securities of the series that may be authenticated
and delivered under this Indenture (except for Securities
authenticated and delivered upon registration of transfer
of, or in exchange for, or in lieu of, other Securities of
the series pursuant to Section 2.8, 2.9, 2.11, 8.5 or 12.3);
(3) the date or dates on which the principal of the
Securities of the series is payable;
(4) the rate or rates at which the Securities of
the series shall bear interest, if any, the date or dates
from which any such interest shall accrue, on which any such
interest shall be payable and on which a record shall be
taken for the determination of Holders to whom any such
interest is payable or the method by which such rate or
rates or date or dates shall be determined or both;
(5) the place or places where and the manner in
which the principal of, premium, if any, and interest, if
any, on Securities of the series shall be payable (if other
than as provided in Section 3.2) and the office or agency
for the Securities of the series maintained by the Issuer
pursuant to Section 3.2;
(6) the right, if any, of the Issuer to redeem,
purchase or repay Securities of the series, in whole or in
part, at its option and the period or periods within which,
the price or prices (or the method by which such price or
prices shall be determined or both) at which, the form or
method of payment therefor if other than in cash and any
terms and conditions upon which and the manner in which (if
different from the provisions of Article Twelve) Securities
of the series may be so redeemed, purchased or repaid, in
whole or in part pursuant to any sinking fund or otherwise;
(7) the obligation, if any, of the Issuer to
redeem, purchase or repay Securities of the series in whole
or in part pursuant to any mandatory redemption, sinking
fund or analogous provisions or at the option of a Holder
thereof and the period or periods within which the price or
prices (or the method by which such price or prices shall be
determined or both) at which, the form or method of payment
therefor if other than in cash and any terms and conditions
upon which and the manner in which (if different from the
provisions of Article Twelve) Securities of the series shall
be redeemed, purchased or repaid, in whole or in part,
pursuant to such obligation;
(8) if other than denominations of $1,000 and any
integral multiple thereof, the denominations in which
Securities of the series shall be issuable;
(9) if other than the principal amount thereof, the
portion of the principal amount of Securities of the series
which shall be payable upon acceleration of the maturity
thereof;
(10) whether Securities of the series will be
issuable as Global Securities;
(11) if the Securities of such series are to be
issuable in definitive form (whether upon original issue or
upon exchange of a temporary Security of such series) only
upon receipt of certain certificates or other documents or
satisfaction of other conditions, the form and terms of such
certificates, documents or conditions;
(12) any trustees, depositaries, authenticating or
paying agents, transfer agents or registrars or any other
agents with respect to the Securities of such series;
(13) any deleted, modified or additional events of
default or remedies or any additional covenants with respect
to the Securities of such series;
(14) whether the provisions of Section 10.1(C) will
be applicable to Securities of such series;
(15) any provision relating to the issuance of
Securities of such series at an original issue discount
(including, without limitation, the issue price thereof, the
rate or rates at which such original issue discount shall
accrete, if any, and the date or dates from or to which or
period or periods during which such original issue discount
shall accrete at such rate or rates);
(16) if other than Dollars, the foreign currency in
which payment of the principal of, premium, if any, and
interest, if any, on the Securities of such series shall be
payable;
(17) if other than United States Trust Company of
New York is to act as Trustee for the Securities of such
series, the name and Corporate Trust Office of such Trustee;
(18) if the amounts of payments of principal of,
premium, if any, and interest, if any, on the Securities of
such series are to be determined with reference to an index,
the manner in which such amounts shall be determined; and
(19) any other terms of the series.
All Securities of any one series shall be
substantially identical, except as to denomination and except as
may otherwise be provided by or pursuant to the Board Resolution
or Officers' Certificate referred to above or as set forth in any
such indenture supplemental hereto. All Securities of any one
series need not be issued at the same time and may be issued from
time to time, consistent with the terms of this Indenture, if so
provided by or pursuant to such Board Resolution, such Officers'
Certificate or in any such indenture supplemental hereto.
Any such Board Resolution or Officers' Certificate
referred to above with respect to Securities of any series filed
with the Trustee on or before the initial issuance of the
Securities of such series shall be incorporated herein by
reference with respect to Securities of such series and shall
thereafter be deemed to be a part of the Indenture for all
purposes relating to Securities of such series as fully as if
such Board Resolution or Officers' Certificate were set forth
herein in full.
SECTION 2.4 Authentication and Delivery of
Securities. The Issuer may deliver Securities of any series
executed by the Issuer to the Trustee for authentication together
with the applicable documents referred to below in this Section
2.4, and the Trustee shall thereupon authenticate and deliver
such Securities to, or upon the order of the Issuer (contained in
the Issuer Order referred to below in this Section 2.4) or
pursuant to such procedures acceptable to the Trustee and to such
recipients as may be specified from time to time by an Issuer
Order. The maturity date, original issue date, interest rate, if
any, and any other terms of the Securities of such series shall
be determined by or pursuant to such Issuer Order and procedures.
If provided for in such procedures and agreed to by the Trustee,
such Issuer Order may authorize authentication and delivery
pursuant to oral instructions from the Issuer or its duly
authorized agent, which instructions shall be promptly confirmed
in writing. In authenticating the Securities of such series and
accepting the additional responsibilities under this Indenture in
relation to such Securities, the Trustee shall be entitled to
receive (in the case of subparagraphs (2), (3) and (4) below only
at or before the time of the first request of the Issuer to the
Trustee to authenticate Securities of such series) and (subject
to Section 6.1) shall be fully protected in relying upon, unless
and until such documents have been superseded or revoked:
(1) an Issuer Order requesting such authentication
and setting forth delivery instructions if the Securities of
such series are not to be delivered to the Issuer, provided
that, with respect to Securities of a series subject to a
Periodic Offering, (a) such Issuer Order may be delivered by
the Issuer to the Trustee prior to the delivery to the
Trustee of such Securities for authentication and delivery,
(b) the Trustee shall authenticate and deliver Securities of
such series for original issue from time to time, in an
aggregate principal amount not exceeding the aggregate
principal amount established for such series, pursuant to an
Issuer Order or pursuant to procedures acceptable to the
Trustee as may be specified from time to time by an Issuer
Order, (c) the maturity date or dates, original issue date
or dates, interest rate or rates, if any, and any other
terms of Securities of such series shall be determined by an
Issuer Order or pursuant to such procedures, (d) if provided
for in such procedures, such Issuer Order may authorize
authentication and delivery pursuant to oral or electronic
instructions from the Issuer or its duly authorized agent or
agents, which oral instructions shall be promptly confirmed
in writing and (e) after the original issuance of the first
Security of such series to be issued, any separate request
by the Issuer that the Trustee authenticate Securities of
such series for original issuance will be deemed to be a
certification by the Issuer that it is in compliance with
all conditions precedent provided for in this Indenture
relating to the authentication and delivery of such
Securities;
(2) the Board Resolution, Officers' Certificate or
executed supplemental indenture referred to in Sections 2.1
and 2.3 by or pursuant to which the forms and terms of the
Securities of such series were established;
(3) an Officers' Certificate setting forth the form
or forms and terms of the Securities stating that the form
or forms and terms of the Securities have been established
pursuant to Sections 2.1 and 2.3 and comply with this
Indenture and covering such other matters as the Trustee may
reasonably request; and
(4) either an Opinion of Counsel, or a letter from
legal counsel addressed to the Trustee permitting it to rely
on an Opinion of Counsel, substantially to the effect that:
(a) the form or forms of the Securities of such
series have been duly authorized and established in
conformity with the provisions of this Indenture;
(b) in the case of an underwritten offering, the
terms of the Securities of such series have been
duly authorized and established in conformity with
the provisions of this Indenture, and, in the case
of an offering that is not underwritten, certain
terms of the Securities of such series have been
established pursuant to a Board Resolution, an
Officers' Certificate or a supplemental indenture in
accordance with this Indenture, and when such other
terms as are to be established pursuant to
procedures set forth in an Issuer Order shall have
been established, all such terms will have been duly
authorized by the Issuer and will have been
established in conformity with the provisions of
this Indenture;
(c) when the Securities of such series have been
executed by the Issuer and authenticated by the
Trustee in accordance with the provisions of this
Indenture and delivered to and duly paid for by the
purchasers thereof, they will have been duly issued
under this Indenture and will be valid and legally
binding obligations of the Issuer, enforceable in
accordance with their respective terms, and will be
entitled to the benefits of this Indenture; and
(d) the execution and delivery by the Issuer of,
and the performance by the Issuer of its obligations
under, the Securities of such series will not
contravene any provision of applicable law or the
articles of incorporation or bylaws of the Issuer or
any agreement or other instrument binding upon the
Issuer or any of its Subsidiaries that is material
to the Issuer and its Subsidiaries, considered as
one enterprise, or, to such counsel's knowledge
after the inquiry indicated therein (which shall be
reasonable), any judgment, order or decree of any
governmental agency or any court having jurisdiction
over the Issuer or any Subsidiary, and no consent,
approval or authorization of any governmental body
or agency is required for the performance by the
Issuer of its obligations under the Securities,
except such as are specified and have been obtained
and such as may be required by the securities or
blue sky laws of the various states in connection
with the offer and sale of the Securities.
In addition, if the authentication and delivery
relates to a new series of Securities created by an indenture
supplemental hereto, such Opinion of Counsel shall also state
that all laws and requirements with respect to the form and
execution by the Issuer of the supplemental indenture with
respect to the series of Securities have been complied with, the
Issuer has corporate power to execute and deliver any such
supplemental indenture and has taken all necessary corporate
action for those purposes and any such supplemental indenture has
been executed and delivered and constitutes the legal, valid and
binding obligation of the Issuer enforceable in accordance with
its terms.
In rendering such opinions, such counsel may qualify
any opinions as to enforceability by stating that such
enforceability may be limited by bankruptcy, insolvency,
reorganization, liquidation, moratorium and other similar laws
affecting the rights and remedies of creditors and is subject to
general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at
law). Such counsel may rely, as to all matters governed by the
laws of jurisdictions other than the State of Texas and the
federal law of the United States, upon opinions of other counsel
(copies of which shall be delivered to the Trustee), who shall be
counsel reasonably satisfactory to the Trustee, in which case the
opinion shall state that such counsel believes that both such
counsel and the Trustee are entitled so to rely. Such counsel
may also state that, insofar as such opinion involves factual
matters, such counsel has relied, to the extent such counsel
deems proper, upon certificates of officers of the Issuer and its
Subsidiaries and certificates of public officials.
The Trustee shall have the right to decline to
authenticate and deliver any Securities of any series under this
Section 2.4 if the Trustee, being advised by counsel, determines
that such action may not lawfully be taken by the Issuer, or if
the Trustee in good faith by its board of directors or board of
trustees, executive committee or a trust committee of directors
or trustees or Responsible Officers shall determine that such
action would expose the Trustee to personal liability to existing
Holders or would adversely affect the Trustee's own rights,
duties or immunities under the Securities, this Indenture or
otherwise.
If the Issuer shall establish pursuant to Section
2.3 that the Securities of a series are to be issued in the form
of one or more Global Securities, then the Issuer shall execute
and the Trustee shall, in accordance with this Section 2.4 and
the Issuer Order with respect to such series, authenticate and
deliver one or more Global Securities that (i) shall represent
and shall be denominated in an amount equal to the aggregate
principal amount of all of the Securities of such series to be
issued in the form of Global Securities and not yet cancelled,
(ii) shall be registered in the name of the Depositary for such
Global Security or Securities or the nominee of such Depositary,
(iii) shall be delivered by the Trustee to such Depositary or
pursuant to such Depositary's instructions, and (iv) shall bear a
legend substantially to the following effect: "Unless and until
it is exchanged in whole or in part for Securities in definitive
registered form, this Security may not be transferred except as a
whole by the Depositary to the nominee of the Depositary or by a
nominee of the Depositary to the Depositary or another nominee of
the Depositary or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary."
Each Depositary designated pursuant to Section 2.3
must, at the time of its designation and at all times while it
serves as Depositary, be a clearing agency registered under the
Securities Exchange Act of 1934, as amended, and any other
applicable statute or regulation.
SECTION 2.5 Execution of Securities. The
Securities shall be signed on behalf of the Issuer by the
chairman of the Board of Directors, the president, any vice
president or the treasurer of the Issuer, under its corporate
seal which may, but need not, be attested by its secretary or one
of its assistant secretaries. Such signatures may be the manual
or facsimile signatures of the present or any future such
officers. The seal of the Issuer may be in the form of a
facsimile thereof and may be impressed, affixed, imprinted or
otherwise reproduced on the Securities. Typographical and other
minor errors or defects in any such reproduction of the seal or
any such signature shall not affect the validity or
enforceability of any Security that has been duly authenticated
and delivered by the Trustee.
In case any officer of the Issuer who shall have
signed any of the Securities shall cease to be such officer
before the Security so signed shall be authenticated and
delivered by the Trustee or disposed of by the Issuer, such
Security nevertheless may be authenticated and delivered or
disposed of as though the person who signed such Security had not
ceased to be such officer of the Issuer; and any Security may be
signed on behalf of the Issuer by such persons as, at the actual
date of the execution of such Security, shall be the proper
officers of the Issuer, although at the date of the execution and
delivery of this Indenture any such person was not such an
officer.
SECTION 2.6 Certificate of Authentication. Only
such Securities as shall bear thereon a certificate of
authentication substantially in the form hereinbefore recited,
executed by the Trustee by the manual signature of one of its
authorized signatories, or its Authenticating Agent, shall be
entitled to the benefits of this Indenture or be valid or
obligatory for any purpose. The execution of such certificate by
the Trustee or its Authenticating Agent upon any Security
executed by the Issuer shall be conclusive evidence that the
Security so authenticated has been duly authenticated and
delivered hereunder and that the Holder is entitled to the
benefits of this Indenture. Each reference in this Indenture to
authentication by the Trustee includes authentication by an agent
appointed pursuant to Section 6.14.
SECTION 2.7 Denomination and Date of Securities;
Payments of Interest. The Securities of each series shall be
issuable in registered form in denominations established as
contemplated by Section 2.3 or, with respect to the Securities of
any series, if not so established, in denominations of $1,000 and
any integral multiple thereof. The Securities of each series
shall be numbered, lettered or otherwise distinguished in such
manner or in accordance with such plan as the officers of the
Issuer executing the same may determine with the approval of the
Trustee, as evidenced by the execution and authentication
thereof.
Each Security shall be dated the date of its
authentication. The Securities of each series shall bear
interest, if any, from the date, and such interest, if any, shall
be payable on the dates, established as contemplated by Section
2.3.
The Person in whose name any Security of any series
is registered at the close of business on any record date
applicable to a particular series with respect to any interest
payment date for such series shall be entitled to receive the
interest, if any, payable on such interest payment date
notwithstanding any transfer or exchange of such Security
subsequent to the record date and prior to such interest payment
date, except if and to the extent the Issuer shall default in the
payment of the interest due on such interest payment date for
such series, in which case such defaulted interest shall be paid
to the Persons in whose names Outstanding Securities for such
series are registered (a) at the close of business on a
subsequent record date (which shall be not less than five
Business Days prior to the date of payment of such defaulted
interest) established by notice given by mail by or on behalf of
the Issuer to the Holders of Securities not less than 15 days
preceding such subsequent record date or (b) as determined by
such other procedure as is mutually acceptable to the Issuer and
the Trustee. The term "record date" as used with respect to any
interest payment date (except a date for payment of defaulted
interest) for the Securities of any series shall mean the date
specified as such in the terms of the Securities of such series
established as contemplated by Section 2.3, or, if no such date
is so established, if such interest payment date is the first day
of a calendar month, the fifteenth day of the next preceding
calendar month or, if such interest payment date is the fifteenth
day of a calendar month, the first day of such calendar month,
whether or not such record date is a Business Day.
SECTION 2.8 Registration, Transfer and Exchange.
The Issuer will keep at each office or agency to be maintained
for the purpose as provided in Section 3.2 for each series of
Securities a register or registers in which, subject to such
reasonable regulations as it may prescribe, it will provide for
the registration of Securities of each series and the
registration of transfer of Securities of such series. Each such
register shall be in written form in the English language or in
any other form capable of being converted into such form within a
reasonable time. At all reasonable times such register or
registers shall be open for inspection and available for copying
by the Trustee.
Upon due presentation for registration of transfer
of any Security of any series at any such office or agency to be
maintained for the purpose as provided in Section 3.2, the Issuer
shall execute and the Trustee shall authenticate and deliver in
the name of the transferee or transferees a new Security or
Securities of the same series, maturity date, interest rate, if
any, and original issue date in authorized denominations for a
like aggregate principal amount.
All Securities presented for registration of
transfer shall (if so required by the Issuer or the Trustee) be
duly endorsed by, or be accompanied by a written instrument or
instruments of transfer in form satisfactory to the Issuer and
the Trustee duly executed by, the Holder or his attorney duly
authorized in writing.
At the option of the Holder thereof, Securities of
any series (other than a Global Security, except as set forth
below) may be exchanged for a Security or Securities of such
series having authorized denominations and an equal aggregate
principal amount, upon surrender of such Securities to be
exchanged at the agency of the Issuer that shall be maintained
for such purpose in accordance with Section 3.2. All Securities
surrendered upon any exchange or registration of transfer
provided for in this Indenture shall be promptly cancelled and
returned to the Issuer.
The Issuer 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 of Securities.
No service charge shall be made for any such transaction or for
any exchange of Securities of any series as contemplated by the
immediately preceding paragraph.
The Issuer shall not be required to exchange or
register a transfer of (a) any Securities of any series for a
period of 15 days next preceding the first mailing or publication
of notice of redemption of Securities of such series to be
redeemed, (b) any Securities selected, called or being called for
redemption, in whole or in part, except, in the case of any
Security to be redeemed in part, the portion thereof not so to be
redeemed or (c) any Security if the Holder thereof has exercised
his right, if any, to require the Issuer to repurchase such
Security in whole or in part, except the portion of such Security
not required to be repurchased.
Notwithstanding any other provision of this Section
2.8, unless and until it is exchanged in whole or in part for
Securities in definitive registered form, a Global Security
representing all or a part of the Securities of a series may not
be transferred except as a whole by the Depositary for such
series to a nominee of such Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such
Depositary or by such Depositary or any such nominee to a
successor Depositary for such series or a nominee of such
successor Depositary.
If at any time the Depositary for any Securities of
a series represented by one or more Global Securities notifies
the Issuer that it is unwilling or unable to continue as
Depositary for such Securities or if at any time the Depositary
for such Securities shall no longer be eligible under Section
2.4, the Issuer shall appoint a successor Depositary with respect
to such Securities. If a successor Depositary for such
Securities is not appointed by the Issuer within 90 days after
the Issuer receives such notice or becomes aware of such
ineligibility, the Issuer's election pursuant to Section 2.3 that
such Securities be represented by one or more Global Securities
shall no longer be effective and the Issuer shall execute, and
the Trustee, upon receipt of an Issuer Order for the
authentication and delivery of definitive Securities of such
series, will authenticate and deliver Securities of such series
in definitive registered form, in any authorized denominations,
in an aggregate principal amount equal to the principal amount of
the Global Security or Securities representing such Securities in
exchange for such Global Security or Securities.
The Issuer may at any time and in its sole
discretion determine that the Securities of any series issued in
the form of one or more Global Securities shall no longer be
represented by a Global Security or Securities. In such event
the Issuer shall execute, and the Trustee, upon receipt of an
Issuer Order for the authentication and delivery of definitive
Securities of such series, shall authenticate and deliver,
Securities of such series in definitive registered form, in any
authorized denominations, in an aggregate principal amount equal
to the principal amount of the Global Security or Securities
representing such Securities, in exchange for such Global
Security or Securities.
If specified by the Issuer pursuant to Section 2.3
with respect to Securities represented by a Global Security, the
Depositary for such Global Security may surrender such Global
Security in exchange in whole or in part for Securities of the
same series in definitive registered form on such terms as are
acceptable to the Issuer and such Depositary. Thereupon, the
Issuer shall execute, and the Trustee shall authenticate and
deliver, without service charge,
(i) to the Person specified by such Depositary, a new
Security or Securities of the same series, of any authorized
denominations as requested by such Person, in an aggregate
principal amount equal to and in exchange for such Person's
beneficial interest in the Global Security; and
(ii) to such Depositary a new Global Security in a
denomination equal to the difference, if any, between the
principal amount of the surrendered Global Security and the
aggregate principal amount of Securities authenticated and
delivered pursuant to clause (i) above.
Upon the exchange of a Global Security for
Securities in definitive registered form in authorized
denominations, such Global Security shall be cancelled by the
Trustee or an agent of the Trustee. Securities in definitive
registered form issued in exchange for a Global Security pursuant
to this Section 2.8 shall be registered in such names and in such
authorized denominations as the Depositary for such Global
Security, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Trustee or an agent
of the Trustee or the Issuer or an agent of the Issuer. The
Trustee or such agent shall deliver at its office such Securities
to or as directed by the Persons in whose names such Securities
are so registered.
All Securities issued upon any registration of
transfer or exchange of Securities shall be valid and legally
binding obligations of the Issuer, evidencing the same debt, and
entitled to the same benefits under this Indenture, as the
Securities surrendered upon such registration of transfer or
exchange.
SECTION 2.9 Mutilated, Defaced, Destroyed, Lost
and Stolen Securities. In case any temporary or definitive
Security shall become mutilated, defaced or be destroyed, lost or
stolen, the Issuer in its discretion may execute, and upon the
written request of any officer of the Issuer, the Trustee shall
authenticate and deliver a new Security of the same series,
maturity date, interest rate, if any, and original issue date,
bearing a number or other distinguishing symbol not
contemporaneously outstanding, in exchange and substitution for
the mutilated or defaced Security, or in lieu of and in
substitution for the Security so destroyed, lost or stolen. In
every case the applicant for a substitute Security shall furnish
to the Issuer and to the Trustee and any agent of the Issuer or
the Trustee such security or indemnity as may be required by the
Trustee or the Issuer or any such agent to indemnify and defend
and to save each of the Trustee and the Issuer and any such agent
harmless and, in every case of destruction, loss or theft,
evidence to their satisfaction of the destruction, loss or theft
of such Security and of the ownership thereof and in the case of
mutilation or defacement, shall surrender the Security to the
Trustee or such agent.
Upon the issuance of any substitute Security, the
Issuer 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 or its agent) connected therewith. In case any
Security which has matured or is about to mature or has been
called for redemption in full shall become mutilated or defaced
or be destroyed, lost or stolen, the Issuer may instead of
issuing a substitute Security, pay or authorize the payment of
the same (without surrender thereof except in the case of a
mutilated or defaced Security), if the applicant for such payment
shall furnish to the Issuer and to the Trustee and any agent of
the Issuer or the Trustee such security or indemnity as any of
them may require to hold each of them harmless, and, in every
case of destruction, loss or theft, the applicant shall also
furnish to the Issuer and the Trustee and any agent of the Issuer
or the Trustee evidence to the Trustee's satisfaction of the
destruction, loss or theft of such Security and of the ownership
thereof.
Every substitute Security of any series issued
pursuant to the provisions of this Section by virtue of the fact
that any such Security is destroyed, lost or stolen shall
constitute an additional contractual obligation of the Issuer,
whether or not the destroyed, lost or stolen Security shall be at
any time enforceable by anyone and shall be entitled to all the
benefits of (but shall be subject to all the limitations of
rights set forth in) this Indenture equally and proportionately
with any and all other Securities of such series duly
authenticated and delivered hereunder. All Securities shall be
held and owned upon the express condition that, to the extent
permitted by law, the foregoing provisions are exclusive with
respect to the replacement or payment of mutilated, defaced,
destroyed, lost or stolen Securities and shall preclude any and
all other rights or remedies notwithstanding any law or statute
existing or hereafter enacted to the contrary with respect to the
replacement or payment of negotiable instruments or other
securities without their surrender.
SECTION 2.10 Cancellation of Securities;
Disposition Thereof. All Securities surrendered for payment,
redemption, registration of transfer or exchange, or for credit
against any payment in respect of a sinking or analogous fund, if
surrendered to the Issuer or any agent of the Issuer or the
Trustee or any agent of the Trustee, shall be delivered to the
Trustee or its agent for cancellation or, if surrendered to the
Trustee, shall be cancelled by it; and no Securities shall be
issued in lieu thereof except as expressly permitted by any of
the provisions of this Indenture. The Trustee shall dispose of
all cancelled Securities in accordance with its standard
procedures and shall deliver a certificate of such disposition to
the Company. If the Issuer or its agent shall acquire any of the
Securities, such acquisition shall not operate as a redemption or
satisfaction of the indebtedness represented by such Securities
unless and until the same are delivered to the Trustee or its
agent for cancellation.
SECTION 2.11 Temporary Securities. Pending the
preparation of definitive Securities for any series, the Issuer
may execute and the Trustee shall authenticate and deliver
temporary Securities for such series (printed, lithographed,
typewritten or otherwise reproduced, in each case in form
satisfactory to the Trustee). Temporary Securities of any series
shall be issuable in any authorized denomination, and
substantially in the form of the definitive Securities of such
series but with such omissions, insertions and variations as may
be appropriate for temporary Securities, all as may be determined
by the Issuer with the concurrence of the Trustee as evidenced by
the execution and authentication thereof. Temporary Securities
may contain such references to any provisions of this Indenture
as may be appropriate. Every temporary Security shall be
executed by the Issuer and be authenticated by the Trustee upon
the same conditions and in substantially the same manner, and
with like effect, as the definitive Securities. Without
unreasonable delay the Issuer shall execute and shall furnish
definitive Securities of such series and thereupon temporary
Securities of such series may be surrendered in exchange therefor
without charge at each office or agency to be maintained by the
Issuer for that purpose pursuant to Section 3.2 and the Trustee
shall authenticate and deliver in exchange for such temporary
Securities of such series an equal aggregate principal amount of
definitive Securities of the same series having authorized
denominations. Until so exchanged, the temporary Securities of
any series shall be entitled to the same benefits under this
Indenture as definitive Securities of such series, unless
otherwise established pursuant to Section 2.3.
SECTION 2.12 CUSIP Numbers. The Issuer in issuing
the Securities may use "CUSIP" numbers (if then generally in
use), and, if so, the Trustee shall use "CUSIP" numbers in
notices of redemption as a convenience to Holders; provided that
any such notice may state that no representation is made as to
the correctness of such numbers either as printed on the
Securities or as contained in any notice of a redemption and that
reliance may be placed only on the other identification numbers
printed on the Securities, and any such redemption shall not be
affected by any defect in or omission of such numbers.
ARTICLE THREE
COVENANTS OF THE ISSUER
SECTION 3.1 Payment of Principal and Interest.
The Issuer covenants and agrees that it will duly and punctually
pay or cause to be paid the principal of, premium, if any, and
interest, if any, on each of the Securities at the place, at the
respective times and in the manner provided in the Securities.
SECTION 3.2 Offices for Notices and Payments, etc.
So long as any of the Securities are Outstanding, the Issuer will
maintain in each Place of Payment, an office or agency where the
Securities may be presented for payment, an office or agency
where the Securities may be presented for registration of
transfer and for exchange as provided in this Indenture, and an
office or agency where notices and demands to or upon the Issuer
in respect of the Securities or of this Indenture may be served.
In case the Issuer shall at any time fail to maintain any such
office or agency, or shall fail to give notice to the Trustee of
any change in the location thereof, presentation may be made and
notice and demand may be served in respect of the Securities or
of this Indenture at the Corporate Trust Office. The Issuer
hereby initially designates the Corporate Trust Office for each
such purpose and appoints the Trustee as registrar and paying
agent and as the agent upon whom notices and demands may be
served with respect to the Securities.
SECTION 3.3 No Interest Extension. In order to
prevent any accumulation of claims for interest after maturity
thereof, the Issuer will not directly or indirectly extend or
consent to the extension of the time for the payment of any claim
for interest on any of the Securities and will not directly or
indirectly be a party to or approve any such arrangement by the
purchase or funding of said claims or in any other manner;
provided, however, that this Section 3.3 shall not apply in any
case where an extension shall be made pursuant to a plan proposed
by the Issuer to the Holders of all Securities of any series then
Outstanding.
SECTION 3.4 Appointments to Fill Vacancies in
Trustee's Office. The Issuer, whenever necessary to avoid or
fill a vacancy in the office of the Trustee, will appoint, in the
manner provided in Section 6.10, a Trustee, so that there shall
at all times be a Trustee hereunder.
SECTION 3.5 Provision as to Paying Agent. (a) If
the Issuer shall appoint a paying agent other than the Trustee,
it will cause such paying agent 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 3.5,
(1) that it will hold all sums held by it as such
paying agent for the payment of the principal of or
interest, if any, on the Securities (whether such sums have
been paid to it by the Issuer or by any other obligor on the
Securities) in trust for the benefit of the Holders of the
Securities and the Trustee; and
(2) that it will give the Trustee notice of any
failure by the Issuer (or by any other obligor on the
Securities) to make any payment of the principal of,
premium, if any, or interest, if any, on the Securities when
the same shall be due and payable; and
(3) that it will, at any time during the
continuance of any such failure, upon the written request of
the Trustee, forthwith pay to the Trustee all sums so held
in trust by such paying agent.
(b) If the Issuer shall act as its own paying
agent, it will, on or before each due date of the principal of or
interest, if any, on the Securities, set aside, segregate and
hold in trust for the benefit of the Holders of the Securities a
sum sufficient to pay such principal, premium, if any, or
interest, if any, so becoming due and will notify the Trustee of
any failure to take such action and of any failure by the Issuer
(or by any other obligor under the Securities) to make any
payment of the principal of, premium, if any, or interest, if
any, on the Securities when the same shall become due and
payable.
(c) Anything in this Section 3.5 to the contrary
notwithstanding, the Issuer may, at any time, for the purpose of
obtaining a satisfaction and discharge of this Indenture, or for
any other reason, pay or cause to be paid to the Trustee all sums
held in trust by it, or any paying agent hereunder, as required
by this Section 3.5, such sums to be held by the Trustee upon the
trusts herein contained.
(d) Anything in this Section 3.5 to the contrary
notwithstanding, any agreement of the Trustee or any paying agent
to hold sums in trust as provided in this Section 3.5 is subject
to Sections 10.3 and 10.4.
(e) Whenever the Issuer shall have one or more
paying agents, it will, on or before each due date of the
principal of or interest, if any, on any Securities, deposit with
a paying agent a sum sufficient to pay the principal, premium, if
any, or interest, if any, so becoming due, such sum to be held in
trust for the benefit of the Persons entitled to such principal,
premium, if any, or interest, if any, and (unless such paying
agent is the Trustee) the Issuer will promptly notify the Trustee
of its action or failure so to act.
ARTICLE FOUR
SECURITYHOLDERS LISTS AND REPORTS BY THE
ISSUER AND THE TRUSTEE
SECTION 4.1 Issuer to Furnish Trustee Information
as to Names and Addresses of Securityholders. The Issuer and any
other obligor on the Securities covenant and agree that they will
furnish or cause to be furnished to the Trustee a list in such
form as the Trustee may reasonably require of the names and
addresses of the Holders of the Securities of each series:
(a) semiannually and not more than 15 days after
each January 1 and July 1, and
(b) at such other times as the Trustee may request
in writing, within 30 days after receipt by the Issuer of
any such request,
provided that if and so long as the Trustee shall be the
registrar for such series, such list shall not be required to be
furnished.
SECTION 4.2 Preservation and Disclosure of
Securityholders Lists. (a) The Trustee shall preserve, in as
current a form as is reasonably practicable, all information as
to the names and addresses of the Holders of each series of
Securities (i) contained in the most recent list furnished to it
as provided in Section 4.1, and (ii) received by it in the
capacity of registrar or paying agent for such series, if so
acting. The Trustee may destroy any list furnished to it as
provided in Section 4.1 upon receipt of a new list so furnished.
(b) In case three or more Holders of Securities
(hereinafter referred to as "applicants") apply in writing to the
Trustee and furnish to the Trustee reasonable proof that each
such applicant has owned a Security for a period of at least six
months preceding the date of such application, and such
application states that the applicants desire to communicate with
other Holders of Securities of a particular series (in which case
the applicants must all hold Securities of such series) or with
Holders of all Securities with respect to their rights under this
Indenture or under such Securities and such application is
accompanied by a copy of the form of proxy or other communication
which such applicants propose to transmit, then the Trustee
shall, within five Business Days after the receipt of such
application, at its election, either
(i) afford to such applicants access to the
information preserved at the time by the Trustee in
accordance with the provisions of subsection (a) of
this Section 4.2, or
(ii) inform such applicants as to the approximate
number of Holders of Securities of such series or of
all Securities, as the case may be, whose names and
addresses appear in the information preserved at the
time by the Trustee, in accordance with the
provisions of subsection (a) of this Section 4.2,
and as to the approximate cost of mailing to such
Securityholders the form of proxy or other
communication, if any, specified in such
application.
If the Trustee shall elect not to afford to such
applicants access to such information, the Trustee shall, upon
the written request of such applicants, mail to each
Securityholder of such series or all Holders of Securities, as
the case may be, whose name and address appears in the
information preserved at the time by the Trustee in accordance
with the provisions of subsection (a) of this Section 4.2 a copy
of the form of proxy or other communication which is specified in
such request, with reasonable promptness after a tender to the
Trustee of the material to be mailed and of payment, or provision
for the payment, of the reasonable expenses of mailing, unless
within five days after such tender, the Trustee shall mail to
such applicants and file with the Commission, together with a
copy of the material to be mailed, a written statement to the
effect that, in the opinion of the Trustee, such mailing would be
contrary to the best interests of the Holders of Securities of
such series or of all Securities, as the case may be, or would be
in violation of applicable law. Such written statement shall
specify the basis of such opinion. If the Commission, after
opportunity for a hearing upon the objections specified in the
written statement so filed, shall enter an order refusing to
sustain any of such objections or if, after the entry of an order
sustaining one or more of such objections, the Commission shall
find, after notice and opportunity for hearing, that all the
objections so sustained have been met, and shall enter an order
so declaring, the Trustee shall mail copies of such material to
all such Securityholders with reasonable promptness after the
entry of such order and the renewal of such tender; otherwise the
Trustee shall be relieved of any obligation or duty to such
applicants respecting their application.
(c) Each and every Holder of Securities, by
receiving and holding the same, agrees with the Issuer and the
Trustee that neither the Issuer nor the Trustee nor any agent of
the Issuer or the Trustee 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 the
provisions of subsection (b) of this Section 4.2, 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 such subsection (b).
SECTION 4.3 Reports by the Issuer. The Issuer
covenants:
(a) to file with the Trustee, within 15 days after
the Issuer 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 Issuer may be required to file
with the Commission pursuant to Section 13 or Section 15(d) of
the Exchange Act; or, if the Issuer is not required to file
information, documents or reports pursuant to either of such
Sections, then to 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 Exchange Act in respect of a debt security
listed and registered on a national securities exchange as may be
prescribed from time to time in such rules and regulations;
(b) to 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 Issuer with the
conditions and covenants provided for in this Indenture as may be
required from time to time by such rules and regulations;
(c) to transmit by mail to the Holders of
Securities within 30 days after the filing thereof with the
Trustee, in the manner and to the extent provided in Section
4.4(c), such summaries of any information, documents and reports
required to be filed by the Issuer pursuant to subsections (a)
and (b) of this Section 4.3 as may be required to be transmitted
to such Holders by rules and regulations prescribed from time to
time by the Commission; and
(d) furnish to the Trustee, not less than annually,
a brief certificate from the principal executive officer,
principal financial officer or principal accounting officer as to
his knowledge of the Issuer's compliance with all conditions and
covenants under this Indenture. For purposes of this subsection
(d), such compliance shall be determined without regard to any
period of grace or requirement of notice provided under this
Indenture.
SECTION 4.4 Reports by the Trustee. (a) Within 60
days after January 1 of each year commencing with the year 1994,
the Trustee shall transmit by mail to the Holders of Securities,
as provided in subsection (c) of this Section 4.4, a brief report
dated as of such January 1 with respect to any of the following
events which may have occurred within the last 12 months (but if
no such event has occurred within such period, no report need be
transmitted):
(i) any change to its eligibility under Section 6.9
and its qualification under Section 6.8;
(ii) the creation of, or any material change to, a
relationship specified in paragraph (1) through (10)
of Section 310(b) of the Trust Indenture Act of
1939;
(iii) the character and amount of any advances (and if
the Trustee elects so to state, the circumstances
surrounding the making thereof) made by the Trustee
(as such) which remain unpaid on the date of such
report and for the reimbursement of which it claims
or may claim a lien or charge, prior to that of the
Securities of any series, on any property or funds
held or collected by it as Trustee, except that the
Trustee shall not be required (but may elect) to
report such advances if such advances so remaining
unpaid aggregate not more than 1/2 of 1% of the
principal amount of all Securities Outstanding on
the date of such report;
(iv) the amount, interest rate, if any, and maturity
date of all other indebtedness owing by the Issuer
(or by any other obligor on the Securities) to the
Trustee in its individual capacity on the date of
such report, with a brief description of any
property held as collateral security therefor,
except any indebtedness based upon a creditor
relationship arising in any manner described in
Section 311(b) of the Trust Indenture Act of 1939;
(v) any change to the property and funds, if any,
physically in the possession of the Trustee (as
such) on the date of such report;
(vi) any additional issue of Securities which the
Trustee has not previously reported; and
(vii) any action taken by the Trustee in the performance
of its duties under this Indenture which it has not
previously reported and which in its opinion
materially affects the Securities, except action in
respect of a default, notice of which has been or is
to be withheld by it in accordance with the
provisions of Article Five.
(b) The Trustee shall transmit to the
Securityholders of each series, as provided in subsection (c) of
this Section 4.4, a brief report with respect to the character
and amount of any advances (and if the Trustee elects so to
state, the circumstances surrounding the making thereof) made by
the Trustee, as such, since the date of the last report
transmitted pursuant to the provisions of subsection (a) of this
Section 4.4 (or if no such report has yet been so transmitted,
since the date of this Indenture) for the reimbursement of which
it claims or may claim a lien or charge prior to that of the
Securities of such series on property or funds held or collected
by it as Trustee and which it has not previously reported
pursuant to this subsection (b), except that the Trustee shall
not be required (but may elect) to report such advances if such
advances remaining unpaid at any time aggregate 10% or less of
the principal amount of all Securities Outstanding at such time,
such report to be transmitted within 90 days after such time.
(c) Reports pursuant to this Section shall be
transmitted by mail:
(i) to all Holders of Securities, as the names and
addresses of such Holders appear upon the registry
books of the Issuer; and
(ii) to all other Persons to whom such reports are
required to be transmitted pursuant to Section
313(c) of the Trust Indenture Act of 1939.
(d) A copy of each such report shall, at the time
of such transmission to Securityholders, be furnished to the
Issuer and be filed by the Trustee with each stock exchange upon
which the Securities of any applicable series are listed and also
with the Commission. The Issuer agrees to promptly notify the
Trustee with respect to any series when and as the Securities of
such series become admitted to trading on any national securities
exchange.
ARTICLE FIVE
REMEDIES OF THE TRUSTEE AND SECURITY HOLDERS
ON EVENT OF DEFAULT
SECTION 5.1 Events of Default. "Event of Default",
wherever used herein with respect to Securities of any series,
means any one or more of the following events (whatever the
reason for such Event of Default and whether it shall be
occasioned by the provisions of Article Thirteen or otherwise),
unless it is either inapplicable to a particular series or it is
specifically deleted or modified in or pursuant to the Board
Resolution or supplemental indenture establishing such series of
Securities or in the form of Security, for such series:
(a) default in the payment of the principal of or
premium, if any, of the Securities of such series as and when the
same shall become due and payable either at maturity, upon
redemption, by declaration or otherwise; or
(b) default in the payment of any installment of
interest upon any of the Securities of such series as and when
the same shall become due and payable, and continuance of such
default for a period of 30 days; or
(c) default in the payment or satisfaction of any
sinking fund or other purchase obligation with respect to
Securities of such series, as and when such obligation shall
become due and payable; or
(d) failure on the part of the Issuer duly to
observe or perform any other of the covenants or agreements on
the part of the Issuer in the Securities of such series or in
this Indenture continued for a period of 90 days after the date
on which written notice of such failure, requiring the same to be
remedied, shall have been given by certified or registered mail
to the Issuer by the Trustee, or to the Issuer and the Trustee by
the Holders of at least 25% in aggregate principal amount of the
Securities of such series then Outstanding; or
(e) without the consent of the Issuer a court
having jurisdiction shall enter an order for relief with respect
to the Issuer under the Bankruptcy Code or without the consent of
the Issuer a court having jurisdiction shall enter a judgment,
order or decree adjudging the Issuer a bankrupt or insolvent, or
enter an order for relief for reorganization, arrangement,
adjustment or composition of or in respect of the Issuer under
the Bankruptcy Code or applicable state insolvency law and the
continuance of any such judgment, order or decree is unstayed and
in effect for a period of 90 consecutive days; or
(f) the Issuer shall institute proceedings for
entry of an order for relief with respect to the Issuer under the
Bankruptcy Code or for an adjudication of insolvency, or shall
consent to the institution of bankruptcy or insolvency
proceedings against it, or shall file a petition seeking, or seek
or consent to reorganization, arrangement, composition or relief
under the Bankruptcy Code or any applicable state law, or shall
consent to the filing of such petition or to the appointment of a
receiver, custodian, liquidator, assignee, trustee, sequestrator
or similar official of the Issuer or of substantially all of its
property, or the Issuer shall make a general assignment for the
benefit of creditors as recognized under the Bankruptcy Code; or
(g) default under any bond, debenture, note or
other evidence of Indebtedness for money borrowed by the Issuer
or under any mortgage, indenture or instrument under which there
may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by the Issuer, whether such
Indebtedness exists on the date hereof or shall hereafter be
created, which default shall have resulted in such Indebtedness
becoming or being declared due and payable prior to the date on
which it would otherwise have become due and payable, or any
default in payment of such Indebtedness (after the expiration of
any applicable grace periods and the presentation of any debt
instruments, if required), if the aggregate amount of all such
Indebtedness that has been so accelerated and with respect to
which there has been such a default in payment shall exceed
$20,000,000, without each such default and acceleration having
been rescinded or annulled within a period of 20 days after there
shall have been given by certified or registered mail to the
Issuer by the Trustee, or to the Issuer and the Trustee by the
Holders of at least 25% in aggregate principal amount of the
Securities of such series then Outstanding, a written notice
specifying each such default and requiring the Issuer to cause
each such default and acceleration to be rescinded or annulled
and stating that such notice is a "Notice of Default" hereunder;
or
(h) any other Event of Default provided with
respect to the Securities of such series.
If an Event of Default with respect to Securities of
any series then Outstanding occurs and is continuing, then and in
each and every such case, unless the principal of all of the
Securities of such series shall have already become due and
payable, either the Trustee or the Holders of not less than 25%
in aggregate principal amount of the Securities of such series
then Outstanding, by notice in writing to the Issuer (and to the
Trustee if given by Securityholders), may declare the principal
(or, if the Securities of such series are Original Issue Discount
Securities, such portion of the principal amount as may be
specified in the terms of such series) of all the Securities of
such series and the interest, if any, accrued thereon to be due
and payable immediately, and upon any such declaration the same
shall become and shall be immediately due and payable,
notwithstanding anything to the contrary contained in this
Indenture or in the Securities of such series. This provision,
however, is subject to the condition that, if at any time after
the unpaid principal amount (or such specified amount) of the
Securities of such series shall have been so declared due and
payable and before any judgment or decree for the payment of the
moneys due shall have been obtained or entered as hereinafter
provided, the Issuer shall pay or shall deposit with the Trustee
a sum sufficient to pay all matured installments of interest, if
any, upon all of the Securities of such series and the principal
of any and all Securities of such series which shall have become
due otherwise than by acceleration (with interest on overdue
installments of interest, if any, to the extent that payment of
such interest is enforceable under applicable law and on such
principal at the rate borne by the Securities of such series to
the date of such payment or deposit) and the reasonable
compensation, disbursements, expenses and advances of the Trustee
and all other amounts due the Trustee under Section 6.6, and any
and all defaults under this Indenture, other than the nonpayment
of such portion of the principal amount of and accrued interest,
if any, on Securities of such series which shall have become due
by acceleration, shall have been cured or shall have been waived
in accordance with Section 5.7 or provision deemed by the Trustee
to be adequate shall have been made therefor, then and in every
such case the Holders of a majority in aggregate principal amount
of the Securities of such series then Outstanding, by written
notice to the Issuer and to the Trustee, may rescind and annul
such declaration and its consequences; but no such rescission and
annulment shall extend to or shall affect any subsequent default,
or shall impair any right consequent thereon. If any Event of
Default with respect to the Issuer specified in Section 5.1(e) or
5.1(f) occurs, all unpaid principal amount (or, if the Securities
of any series then Outstanding are Original Issue Discount
Securities, such portion of the principal amount as may be
specified in the terms of each such series) and accrued interest
on all Securities of each series then Outstanding shall ipso
facto become and be immediately due and payable without any
declaration or other act by the Trustee or any Securityholder.
If the Trustee shall have proceeded to enforce any
right under this Indenture and such proceedings shall have been
discontinued or abandoned because of such rescission or annulment
or for any other reason or shall have been determined adversely
to the Trustee, then and in every such case the Issuer, the
Trustee and the Securityholders shall be restored respectively to
their several positions and rights hereunder, and all rights,
remedies and powers of the Issuer, the Trustee and the
Securityholders shall continue as though no such proceeding had
been taken.
Except with respect to an Event of Default pursuant
to Section 5.1 (a), (b) or (c), the Trustee shall not be charged
with knowledge of any Event of Default unless written notice
thereof shall have been given to a Responsible Officer by the
Issuer, a paying agent or any Securityholder.
SECTION 5.2 Payment of Securities on Default; Suit
Therefor. The Issuer covenants that (a) if default shall be made
in the payment of any installment of interest upon any of the
Securities of any series then Outstanding as and when the same
shall become due and payable, and such default shall have
continued for a period of 60 days, or (b) if default shall be
made in the payment of the principal of any of the Securities of
such series as and when the same shall have become due and
payable, whether at maturity of the Securities of such series or
upon redemption or by declaration or otherwise, then, upon demand
of the Trustee, the Issuer will pay to the Trustee, for the
benefit of the Holders of the Securities, the whole amount that
then shall have become due and payable on all such Securities of
such series for principal or interest, if any, or both, as the
case may be, with interest upon the overdue principal and (to the
extent that payment of such interest is enforceable under
applicable law) upon the overdue installments of interest, if
any, at the rate borne by the Securities of such series; and, in
addition thereto, such further amount as shall be sufficient to
cover the costs and expenses of collection, including a
reasonable compensation to the Trustee, its agents, attorneys and
counsel, and any expenses or liabilities incurred by the Trustee
hereunder other than through its negligence or bad faith.
If the Issuer shall fail forthwith to pay such
amounts upon such demand, the Trustee, in its own name and as
trustee of an express trust, shall be entitled and empowered to
institute any actions or proceedings at law or in equity for the
collection of the sums so due and unpaid, and may prosecute any
such action or proceeding to judgment or final decree, and may
enforce any such judgment or final decree against the Issuer or
any other obligor on the Securities of such series and collect in
the manner provided by law out of the property of the Issuer or
any other obligor on the Securities of such series, wherever
situated, the moneys adjudged or decreed to be payable.
If there shall be pending proceedings for the
bankruptcy or for the reorganization of the Issuer or any other
obligor on the Securities of any series then Outstanding under
any bankruptcy, insolvency or other similar law now or hereafter
in effect, or if a receiver or trustee or similar official shall
have been appointed for the property of the Issuer or such other
obligor, or in the case of any other similar judicial proceedings
relative to the Issuer or other obligor upon the Securities of
such series, or to the creditors or property of the Issuer or
such other obligor, the Trustee, irrespective of whether the
principal of the Securities of such series 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
pursuant to the provisions of this Section 5.2, shall be entitled
and empowered by intervention in such proceedings or otherwise to
file and prove a claim or claims for the whole amount of
principal and interest, if any, owing and unpaid in respect of
the Securities of such series, and, in case of any judicial
proceedings, to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the
claims of the Trustee and of the Securityholders allowed in such
judicial proceedings relative to the Issuer or any other obligor
on the Securities of such series, its or their creditors, or its
or their property, and to collect and receive any moneys or other
property payable or deliverable on any such claims, and to
distribute the same after the deduction of its charges and
expenses, and any receiver, assignee or trustee or similar
official in bankruptcy or reorganization is hereby authorized by
each of the Securityholders to make such payments to the Trustee,
and, if the Trustee shall consent to the making of such payments
directly to the Securityholders, to pay to the Trustee any amount
due it for compensation and expenses or otherwise pursuant to
Section 6.6, including counsel fees and expenses incurred by it
up to the date of such distribution. To the extent that such
payment of reasonable compensation, expenses and counsel fees and
expenses out of the estate in any such proceedings shall be
denied for any reason, payment of the same shall be secured by a
lien on, and shall be paid out of, any and all distributions,
dividends, moneys, securities and other property which the
Holders of the Securities of such series may be entitled to
receive in such proceedings, whether in liquidation or under any
plan of reorganization or arrangement or otherwise.
All rights of action and of asserting claims under
this Indenture, or under any of the Securities, may be enforced
by the Trustee without the possession of any of the Securities,
or the production thereof at any trial or other proceeding
relative thereto, and any such suit or proceeding instituted by
the Trustee shall be brought in its own name as trustee of an
express trust, and any recovery of judgment shall be for the
ratable benefit of the Holders of the Securities of the series in
respect of which such judgment has been recovered.
SECTION 5.3 Application of Moneys Collected by
Trustee. Any moneys collected by the Trustee pursuant to Section
5.2 with respect to Securities of any series then Outstanding
shall be applied in the order following, at the date or dates
fixed by the Trustee for the distribution of such moneys, upon
presentation of the several Securities of such series, and
stamping thereon the payment, if only partially paid, and upon
surrender thereof, if fully paid:
FIRST: To the payment of costs and expenses of
collection and reasonable compensation to the Trustee, its
agents, attorneys and counsel, and of all other expenses and
liabilities incurred, and all advances made, by the Trustee
pursuant to Section 6.6 except as a result of its negligence
or bad faith;
SECOND: If the principal of the Outstanding
Securities of such series shall not have become due and be
unpaid, to the payment of interest, if any, on the
Securities of such series, in the order of the maturity of
the installments of such interest, if any, with interest (to
the extent that such interest has been collected by the
Trustee) upon the overdue installments of interest, if any,
at the rate borne by the Securities of such series, such
payment to be made ratably to the Persons entitled thereto;
THIRD: If the principal of the Outstanding
Securities of such series shall have become due, by
declaration or otherwise, to the payment of the whole amount
then owing and unpaid upon the Securities of such series for
principal and interest, if any, with interest on the overdue
principal and (to the extent that such interest has been
collected by the Trustee) upon overdue installments of
interest, if any, at the rate borne by the Securities of
such series; and in case such moneys shall be insufficient
to pay in full the whole amounts so due and unpaid upon the
Securities of such series, then to the payment of such
principal and interest, if any, without preference or
priority of principal over interest or of interest over
principal, or of any installment of interest over any other
installment of interest, or of any Security over any other
Security, ratably to the aggregate of such principal and
accrued and unpaid interest; and
FOURTH: To the payment of any surplus then
remaining to the Issuer, its successors or assigns, or to
whomsoever may be lawfully entitled to receive the same.
No claim for interest which in any manner at or
after maturity shall have been transferred or pledged separate or
apart from the Securities to which it relates, or which in any
manner shall have been kept alive after maturity by an extension
(otherwise than pursuant to an extension made pursuant to a plan
proposed by the Issuer to the Holders of all Securities of any
series then Outstanding), purchase, funding or otherwise by or on
behalf or with the consent or approval of the Issuer shall be
entitled, in case of a default hereunder, to any benefit of this
Indenture, except after prior payment in full of the principal of
all Securities of any series then Outstanding and of all claims
for interest not so transferred, pledged, kept alive, extended,
purchased or funded.
SECTION 5.4 Proceedings by Securityholders. No
Holder of any Securities of any series then Outstanding shall
have any right by virtue of or by availing of any provision of
this Indenture to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Indenture
or for the appointment of a receiver or trustee or similar
official, or for any other remedy hereunder, unless such Holder
previously shall have given to the Trustee written notice of
default and of the continuance thereof, as hereinbefore provided,
and unless the Holders of not less than 25% in aggregate
principal amount of the Securities of such series then
Outstanding shall have made written request to the Trustee to
institute such action, suit or proceeding in its own name as
Trustee hereunder and shall have offered to the Trustee such
reasonable indemnity as it may require against the costs,
expenses and liabilities to be incurred therein or thereby, and
the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity, shall have neglected or refused to
institute any such action, suit or proceeding, it being
understood and intended, and being expressly covenanted by the
Holder of every Security of such series with every other Holder
and the Trustee, that no one or more Holders of Securities of
such series shall have any right in any manner whatever by virtue
of or by availing of any provision of this Indenture or of the
Securities to affect, disturb or prejudice the rights of any
other Holder of such Securities of such series, or to obtain or
seek to obtain priority over or preference as to any other such
Holder, or to enforce any right under this Indenture or the
Securities, except in the manner herein provided and for the
equal, ratable and common benefit of all Holders of Securities of
such series.
Notwithstanding any other provisions in this
Indenture, but subject to Article Thirteen, the right of any
Holder of any Security to receive payment of the principal of,
premium, if any, and interest, if any, on such Security, on or
after the respective due dates expressed in such Security, or to
institute suit for the enforcement of any such payment on or
after such respective dates shall not be impaired or affected
without the consent of such Holder.
SECTION 5.5 Proceedings by Trustee. In case of an
Event of Default hereunder, the Trustee may in its discretion
proceed to protect and enforce the rights vested in it by this
Indenture by such appropriate judicial proceedings as the Trustee
shall deem most effectual to protect and enforce any of such
rights, either by suit in equity or by action at law or by
proceedings in bankruptcy or otherwise, whether for the specific
enforcement of any covenant or agreement contained in this
Indenture or in aid of the exercise of any power granted in this
Indenture, or to enforce any other legal or equitable right
vested in the Trustee by this Indenture or by law.
SECTION 5.6 Remedies Cumulative and Continuing.
All powers and remedies given by this Article Five to the Trustee
or to the Securityholders shall, to the extent permitted by law,
be deemed cumulative and not exclusive of any thereof or of any
other powers and remedies available to the Trustee or the
Securityholders, by judicial proceedings or otherwise, to enforce
the performance or observance of the covenants and agreements
contained in this Indenture, and no delay or omission of the
Trustee or of any Securityholder to exercise any right or power
accruing upon any default occurring and continuing as aforesaid
shall impair any such right or power, or shall be construed to be
a waiver of any such default or an acquiescence therein; and,
subject to the provisions of Section 5.4, every power and remedy
given by this Article Five or by law to the Trustee or to the
Securityholders may be exercised from time to time, and as often
as shall be deemed expedient, by the Trustee or by the
Securityholders.
SECTION 5.7 Direction of Proceedings; Waiver of
Defaults by Majority of Securityholders. The Holders of a
majority in aggregate principal amount of the Securities of any
series then Outstanding 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 Securities of such
series; provided, however, that (subject to the provisions of
Section 6.1) the Trustee shall have the right to decline to
follow any such direction if the Trustee shall determine upon
advice of counsel that the action or proceeding so directed may
not lawfully be taken or if the Trustee in good faith by its
board of directors, its executive committee, or a trust committee
of directors or Responsible Officers or both shall determine that
the action or proceeding so directed would involve the Trustee in
personal liability. The Holders of a majority in aggregate
principal amount of the Securities of any series then Outstanding
may on behalf of the Holders of all of the Securities of such
series waive any past default or Event of Default hereunder and
its consequences except a default in the payment of interest, if
any, on, or the principal of, the Securities of such series.
Upon any such waiver the Issuer, the Trustee and the Holders of
the Securities of such series shall be restored to their former
positions and rights hereunder, respectively; but no such waiver
shall extend to any subsequent or other default or Event of
Default or impair any right consequent thereon. Whenever any
default or Event of Default hereunder shall have been waived as
permitted by this Section 5.7, said default or Event of Default
shall for all purposes of the Securities and this Indenture be
deemed to have been cured and to be not continuing.
SECTION 5.8 Notice of Defaults. The Trustee shall,
within 90 days after the occurrence of a default, with respect to
Securities of any series then Outstanding, mail to all Holders of
Securities of such series, as the names and the addresses of such
Holders appear upon the Securities register, notice of all
defaults known to the Trustee with respect to such series, unless
such defaults shall have been cured before the giving of such
notice (the term "defaults" for the purpose of this Section 5.8
being hereby defined to be the events specified in clauses (a),
(b), (c), (d), (e), (f), (g) and (h) of Section 5.1, not
including periods of grace, if any, provided for therein and
irrespective of the giving of the written notice specified in
said clause (d) or (g) but in the case of any default of the
character specified in said clause (d) or (g) no such notice to
Securityholders shall be given until at least 60 days after the
giving of written notice thereof to the Issuer pursuant to said
clause (d) or (g), as the case may be); provided, however, that,
except in the case of default in the payment of the principal of
or interest, if any, on any of the Securities, or in the payment
or satisfaction of any sinking fund or other purchase obligation,
the Trustee shall be protected in withholding such notice if and
so long as the board of directors, the executive committee, or a
trust committee of directors or Responsible Officers or both, of
the Trustee in good faith determines that the withholding of such
notice is in the best interests of the Securityholders.
SECTION 5.9 Undertaking to Pay Costs. All parties
to this Indenture agree, and each Holder of any Security by his
acceptance thereof shall be deemed to have agreed, that any court
may in its discretion require, in any suit for the enforcement of
any right or remedy under this Indenture, or in any suit against
the Trustee for any action taken or omitted by it as Trustee, the
filing by any party litigant in such suit of an undertaking to
pay the cost of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in such
suit, having due regard to the merits and good faith of the
claims or defenses made by such party litigant; but the
provisions of this Section 5.9 shall not apply to any suit
instituted by the Trustee, to any suit instituted by any
Securityholder, or group of Securityholders, holding in the
aggregate more than 10% in principal amount of the Securities of
any series then Outstanding, or to any suit instituted by any
Securityholders for the enforcement of the payment of the
principal of or interest, if any, on any Security against the
Issuer on or after the due date expressed in such Security.
ARTICLE SIX
CONCERNING THE TRUSTEE
SECTION 6.1 Duties and Responsibilities of the
Trustee; During Default; Prior to Default. With respect to the
Holders of any series of Securities issued hereunder, the
Trustee, prior to the occurrence of an Event of Default with
respect to the Securities of a particular series and after the
curing or waiving of all Events of Default which may have
occurred with respect to such series, undertakes to perform such
duties and only such duties as are specifically set forth in this
Indenture. In case an Event of Default with respect to the
Securities of a series has occurred (which has not been cured or
waived) the Trustee shall exercise with respect to such series of
Securities such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their
exercise as a prudent man would exercise or use under the
circumstances in the conduct of his own affairs.
No provision of this Indenture shall be construed to
relieve the Trustee from liability for its own negligent action,
its own negligent failure to act or its own wilful misconduct,
except that:
(a) prior to the occurrence of an Event of Default
with respect to the Securities of any series and after the curing
or waiving of all such Events of Default with respect to such
series which may have occurred:
(i) the duties and obligations of the Trustee with
respect to the Securities of any series shall be
determined solely by the express provisions of this
Indenture, and the Trustee shall not be liable
except for the performance of such duties and
obligations as are specifically set forth in this
Indenture, and no implied covenants or obligations
shall be read into this Indenture against the
Trustee; and
(ii) in the absence of bad faith on the part of the
Trustee, the Trustee may conclusively rely, as to
the truth of the statements and the correctness of
the opinions expressed therein, upon any statements,
certificates or opinions furnished to the Trustee
and conforming to the requirements of this
Indenture; but in the case of any such statements,
certificates or opinions which by any provision
hereof are specifically required to be furnished to
the Trustee, the Trustee shall be under a duty to
examine the same to determine whether or not they
conform to the requirements of this Indenture;
(b) the Trustee shall not be liable for any error
of judgment made in good faith by a Responsible Officer or
Responsible Officers of the Trustee, unless it shall be proved
that the Trustee was negligent in ascertaining the pertinent
facts; and
(c) the Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders pursuant to Article
Five relating to the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred upon the Trustee, under this
Indenture.
None of the provisions contained in this Indenture
shall require the Trustee to expend or risk its own funds or
otherwise incur personal financial liability in the performance
of any of its duties or in the exercise of any of its rights or
powers, if there shall be reasonable ground for believing that
the repayment of such funds or adequate indemnity against such
liability is not reasonably assured to it.
SECTION 6.2 Certain Rights of the Trustee. Subject
to Section 6.1:
(a) the Trustee may rely and shall be protected in
acting or refraining from acting upon any resolution, Officers'
Certificate or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, bond,
debenture, note, coupon, security or other paper or document
believed by it to be genuine and to have been signed or presented
by the proper party or parties;
(b) any request, direction, order or demand of the
Issuer mentioned herein shall be sufficiently evidenced by an
Officers' Certificate or Issuer Order (unless other evidence in
respect thereof be herein specifically prescribed); and any
resolution of the Board of Directors may be evidenced to the
Trustee by a Board Resolution;
(c) the Trustee may consult with counsel of its
selection and any advice of such counsel promptly confirmed in
writing shall be full and complete authorization and protection
in respect of any action taken, suffered or omitted to be taken
by it hereunder in good faith and in reliance thereon in
accordance with such advice or Opinion of Counsel;
(d) the Trustee shall be under no obligation to
exercise any of the trusts or powers vested in it by this
Indenture at the request, order or direction of any of the
Securityholders pursuant to the provisions of this Indenture
(including, without limitation, pursuant to Article Five), unless
such Securityholders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities
which might be incurred therein or thereby;
(e) the Trustee shall not be liable for any action
taken or omitted by it in good faith and believed by it to be
authorized or within the discretion, rights or powers conferred
upon it by this Indenture;
(f) prior to the occurrence of an Event of Default
hereunder and after the curing or waiving of all Events of
Default, 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, consent,
order, approval, appraisal, bond, debenture, note, coupon,
security, or other paper or document unless requested in writing
so to do by the Holders of not less than a majority in aggregate
principal amount of the Securities of all series affected then
Outstanding; provided that, if the payment within a reasonable
time to the Trustee of the costs, expenses or liabilities likely
to be incurred by it in the making of such investigation is, in
the opinion of the Trustee, not reasonably assured to the Trustee
by the security afforded to it by the terms of this Indenture,
the Trustee may require reasonable indemnity against such
expenses or liabilities as a condition to proceeding; the
reasonable expenses of every such investigation shall be paid by
the Issuer or, if paid by the Trustee or any predecessor Trustee,
shall be repaid by the Issuer upon demand;
(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 not regularly in its employ
and the Trustee shall not be responsible for any misconduct or
negligence on the part of any such agent or attorney appointed
with due care by it hereunder;
(h) The Trustee shall not be charged with knowledge
of any default or Event of Default with respect to a series of
Securities unless either (i) a Responsible Officer of the Trustee
assigned to the Corporate Trust Office of the Trustee (or any
successor division or department of the Trustee) shall have
actual knowledge of such default or Event of Default or (ii)
written notice of such default or Event of Default shall have
been given to the Trustee by the Issuer or any other obligor on
such series of Securities or by any Holder of Securities of such
series; and
(i) The Trustee shall not be liable for any action
taken, suffered or omitted by it in good faith and believed by it
to be authorized or within the discretion or rights or powers
conferred upon it by this Indenture.
SECTION 6.3 Trustee Not Responsible for Recitals,
Disposition of Securities or Application of Proceeds Thereof.
The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the
statements of the Issuer, and the Trustee assumes no
responsibility for the correctness of the same. The Trustee
makes no representation as to the validity or sufficiency of this
Indenture, of the Securities or of any prospectus used to sell
the Securities. The Trustee shall not be accountable for the use
or application by the Issuer of any of the Securities or of the
proceeds thereof.
SECTION 6.4 Trustee and Agents May Hold
Securities; Collections, etc. The Trustee or any agent of the
Issuer or the Trustee, in its individual or any other capacity,
may become the owner or pledgee of Securities with the same
rights it would have if it were not the Trustee or such agent
and, subject to Sections 6.8 and 6.13, may otherwise deal with
the Issuer and receive, collect, hold and retain collections from
the Issuer with the same rights it would have if it were not the
Trustee or such agent.
SECTION 6.5 Moneys Held by Trustee. Subject to the
provisions of Section 10.4 hereof, all moneys received by the
Trustee shall, until used or applied as herein provided, be held
in trust for the purposes for which they were received, but need
not be segregated from other funds except to the extent required
by mandatory provisions of law. Neither the Trustee nor any
agent of the Issuer or the Trustee shall be under any liability
for interest on any moneys received by it hereunder.
SECTION 6.6 Compensation and Indemnification of
Trustee and Its Prior Claim. The Issuer covenants and agrees to
pay to the Trustee from time to time, and the Trustee shall be
entitled to, such compensation as shall be agreed to in writing
between the Issuer and the Trustee (which shall not be limited by
any provision of law in regard to the compensation of a trustee
of an express trust) and the Issuer covenants and agrees to pay
or reimburse the Trustee and each predecessor Trustee upon its
request for all reasonable expenses, disbursements and advances
incurred or made by or on behalf of it in accordance with any of
the provisions of this Indenture (including the reasonable
compensation and the expenses and disbursements of its counsel
and of all agents and other persons not regularly in its employ)
except any such expense, disbursement or advance as may arise
from its negligence or bad faith. The Issuer also covenants to
indemnify the Trustee and each predecessor Trustee for, and to
hold it harmless against, any and all loss, liability, damage,
claim or expense, including taxes (other than taxes based on the
income of the Trustee), incurred without negligence or bad faith
on its part, arising out of or in connection with the acceptance
or administration of this Indenture or the trusts hereunder and
its duties hereunder, including the costs and expenses of
defending itself against or investigating any claim or liability
in the premises. The obligations of the Issuer under this
Section 6.6 to compensate and indemnify the Trustee and each
predecessor Trustee and to pay or reimburse the Trustee and each
predecessor Trustee for expenses, disbursements and advances
shall constitute additional indebtedness hereunder and shall
survive the satisfaction and discharge of this Indenture or the
resignation or removal of the Trustee and shall not be
subordinate to the payment of Senior Indebtedness pursuant to
Article Thirteen. Such additional indebtedness shall be a senior
claim to that of the Securities upon all property and funds held
or collected by the Trustee as such, except funds held in trust
for the benefit of the Holders of particular Securities, and the
Securities are hereby subordinated to such senior claim. When
the Trustee incurs expenses or renders services in connection
with an Event of Default specified in Section 5.1 or in
connection with Article Five hereof, the expenses (including the
reasonable fees and expenses of its counsel) and the compensation
for the service in connection therewith are intended to
constitute expenses of administration under any bankruptcy law.
The provisions of this Section 6.6 shall survive the resignation
or removal of the Trustee and the termination of this Indenture.
SECTION 6.7 Right of Trustee to Rely on Officers'
Certificate, etc. Subject to Sections 6.1 and 6.2, whenever in
the administration of the trusts of this Indenture the Trustee
shall deem it necessary or desirable that a matter be proved or
established prior to taking or suffering or omitting any action
hereunder, such matter (unless other evidence in respect thereof
be herein specifically prescribed) may, in the absence of
negligence or bad faith on the part of the Trustee, be deemed to
be conclusively proved and established by an Officers'
Certificate delivered to the Trustee, and such certificate, in
the absence of negligence or bad faith on the part of the
Trustee, shall be full warrant to the Trustee for any action
taken, suffered or omitted by it under the provisions of this
Indenture upon the faith thereof.
SECTION 6.8 Qualification of Trustee; Conflicting
Interests. This Indenture shall always have a Trustee who
satisfies the requirements of Section 310(a)(1) of the Trust
Indenture Act of 1939. The Trustee shall have a combined capital
and surplus of at least $25,000,000 as set forth in its most
recent published annual report of condition. The Trustee shall
comply with Section 310(b) of the Trust Indenture Act of 1939
regarding disqualification of a trustee upon acquiring a
conflicting interest.
SECTION 6.9 Persons Eligible for Appointment as
Trustee; Different Trustees for Different Series. The Trustee
for each series of Securities hereunder shall at all times be a
corporation organized and doing business under the laws of the
United States of America or of any state or the District of
Columbia having a combined capital and surplus of at least
$25,000,000, and which is authorized under such laws to exercise
corporate trust powers and is subject to supervision or
examination by federal, state or District of Columbia authority,
or a corporation or other Person permitted to act as trustee by
the Commission. If such corporation publishes reports of
condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority,
then for the purposes of this Section, the combined capital and
surplus of such corporation shall be deemed to be its combined
capital and surplus as set forth in its most recent report of
condition so published. No obligor upon the Securities or any
Affiliate of such obligor shall serve as trustee upon the
Securities. In case at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section 6.9,
the Trustee shall resign immediately in the manner and with the
effect specified in Section 6.10.
A different Trustee may be appointed by the Issuer
for any series of Securities prior to the issuance of such
Securities. If the initial Trustee for any series of Securities
is to be a trustee other than United States Trust Company of New
York, the Issuer and such Trustee shall, prior to the issuance of
such Securities, execute and deliver an indenture supplemental
hereto, which shall provide for the appointment of such Trustee
as Trustee for the Securities of such series and shall add to or
change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the
trusts hereunder by more than one Trustee, it being understood
that nothing herein or in such supplemental indenture shall
constitute such Trustees co-trustees of the same trust and that
each such Trustee shall be trustee of a trust or trusts hereunder
separate and apart from any trust or trusts hereunder
administered by any other such Trustee.
SECTION 6.10 Resignation and Removal; Appointment
of Successor Trustee. (a) The Trustee, or any trustee or
trustees hereafter appointed, may at any time resign with respect
to one or more or all series of Securities by giving written
notice of resignation to the Issuer. Upon receiving such notice
of resignation, the Issuer shall promptly appoint a successor
trustee or trustees with respect to the applicable series by
written instrument in duplicate, executed by authority of the
Board of Directors, one copy of which instrument shall be
delivered to the resigning trustee and one copy to the successor
trustee or trustees. If no successor trustee shall have been so
appointed with respect to any series and have accepted
appointment within 30 days after the mailing of such notice of
resignation, the resigning trustee may petition any court of
competent jurisdiction for the appointment of a successor
trustee, or any Securityholder who has been a bona fide Holder of
a Security or Securities of the applicable series for at least
six months may, subject to the provisions of Article Five, on
behalf of himself and all others similarly situated, petition any
such court for the appointment of a successor trustee. Such
court may thereupon, after such notice, if any, as it may deem
proper and prescribe, appoint a successor trustee.
(b) In case at any time any of the following shall occur:
(i) the Trustee shall fail to comply with the
provisions of Section 6.8 with respect to any series
of Securities after written request therefor by the
Issuer or by any Securityholder who has been a bona
fide Holder of a Security or Securities of such
series for at least six months; or
(ii) the Trustee shall cease to be eligible in
accordance with the provisions of Section 6.9 and
shall fail to resign after written request therefor
by the Issuer or by any such Securityholder; or
(iii) the Trustee shall become incapable of acting with
respect to any series of Securities, or shall be
adjudged a bankrupt or insolvent, or a receiver or
liquidator 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, the Issuer may remove the Trustee with
respect to the applicable series of Securities and appoint a
successor trustee for such series by written instrument, in
duplicate, executed by order of the Board of Directors one copy
of which instrument shall be delivered to the Trustee so removed
and one copy to the successor trustee, or, subject to the
provisions of Article Five, any Securityholder who has been a
bona fide Holder of a Security or Securities 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 and the appointment of a successor
trustee with respect to such series. Such court may thereupon,
after such notice, if any, as it may deem proper and prescribe,
remove the Trustee and appoint a successor trustee.
(c) The Holders of a majority in aggregate
principal amount of the Securities of each series then
Outstanding may at any time remove the Trustee with respect to
Securities of such series and appoint a successor trustee with
respect to the Securities of such series by delivering to the
Trustee so removed, to the successor trustee so appointed and to
the Issuer the evidence provided for in Section 7.1 of the action
in that regard taken by the Securityholders. If no successor
trustee shall have been so appointed with respect to any series
and have accepted appointment within 30 days after the delivery
of such evidence of removal, the Trustee may petition any court
of competent jurisdiction for the appointment of a successor
trustee, or any Securityholder who has been a bona fide Holder of
a Security or Securities of the applicable series for at least
six months may, subject to the provisions of Article Five, on
behalf of himself and all others similarly situated, petition any
such court for the appointment of a successor trustee. Such
court may thereupon, after such notice, if any, as it may deem
proper and prescribe, appoint a successor trustee.
(d) Any resignation or removal of the Trustee with
respect to any series and any appointment of a successor trustee
with respect to such series pursuant to any of the provisions of
this Section 6.10 shall become effective upon acceptance of
appointment by the successor trustee as provided in Section 6.11.
SECTION 6.11 Acceptance of Appointment by
Successor Trustee. Any successor trustee appointed as provided
in Section 6.10 shall execute and deliver to the Issuer and to
its predecessor trustee an instrument accepting such appointment
hereunder, and thereupon the resignation or removal of the
predecessor trustee with respect to all or any applicable series
shall become effective and such successor trustee, without any
further act, deed or conveyance, shall become vested with all
rights, powers, duties and obligations with respect to such
series of its predecessor hereunder, with like effect as if
originally named as trustee for such series hereunder; but,
nevertheless, on the written request of the Issuer or of the
successor trustee, upon payment of its charges then unpaid, the
trustee ceasing to act shall, subject to Section 10.4, pay over
to the successor trustee all moneys at the time held by it
hereunder and shall execute and deliver an instrument
transferring to such successor trustee all such rights, powers,
duties and obligations. Upon request of any such successor
trustee, the Issuer shall execute any and all instruments in
writing for more fully and certainly vesting in and confirming to
such successor trustee all such rights and powers. Any trustee
ceasing to act shall, nevertheless, retain a prior claim upon all
property or funds held or collected by such trustee to secure any
amounts then due it pursuant to the provisions of Section 6.6.
If a successor trustee is appointed with respect to
the Securities of one or more (but not all) series, the Issuer,
the predecessor Trustee and each successor trustee with respect
to the Securities of any applicable series shall execute and
deliver an indenture supplemental hereto which shall contain such
provisions as shall be deemed necessary or desirable to confirm
that all the rights, powers, trusts and duties of the predecessor
Trustee with respect to the Securities of any series as to which
the predecessor Trustee is not retiring shall continue to be
vested in the predecessor Trustee, and shall add to or change any
of the provisions of this Indenture as shall be necessary to
provide for or facilitate the administration of the trusts
hereunder by more than one trustee, it being understood that
nothing herein or in such supplemental indenture shall constitute
such trustees co-trustees of the same trust and that each such
trustee shall be trustee of a trust or trusts under separate
indentures.
No successor trustee with respect to any series of
Securities shall accept appointment as provided in this Section
6.11 unless at the time of such acceptance such successor trustee
shall be qualified under the provisions of Section 6.8 and
eligible under the provisions of Section 6.9.
Upon acceptance of appointment by any successor
trustee as provided in this Section 6.11, the Issuer shall give
notice thereof to the Holders of Securities of each series
affected, by mailing such notice to such Holders at their
addresses as they shall appear on the registry books. If the
Issuer fails to give such notice within ten days after acceptance
of appointment by the successor trustee, the successor trustee
shall cause such notice to be given at the expense of the Issuer.
SECTION 6.12 Merger, Conversion, Consolidation or
Succession to Business of Trustee. Any corporation into which
the Trustee may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to all or substantially all
of the corporate trust business of the Trustee, shall be the
successor of the Trustee hereunder, provided that such
corporation shall be qualified under the provisions of Section
6.8 and eligible under the provisions of Section 6.9, without the
execution or filing of any paper or any further act on the part
of any of the parties hereto, anything herein to the contrary
notwithstanding.
In case at the time such successor to the Trustee
shall succeed to the trusts created by this Indenture any of the
Securities of any series shall have been authenticated but not
delivered, any such successor to the Trustee may adopt the
certificate of authentication of any predecessor Trustee and
deliver such Securities so authenticated; and, in case at that
time any of the Securities of any series shall not have been
authenticated, any successor to the Trustee may authenticate such
Securities either in the name of any predecessor hereunder or in
the name of the successor Trustee; and in all such cases such
certificate shall have the full force which it is anywhere in the
Securities of such series or in this Indenture provided that the
certificate of the Trustee shall have; provided, that the right
to adopt the certificate of authentication of any predecessor
Trustee or to authenticate Securities of any series in the name
of any predecessor Trustee shall apply only to its successor or
successors by merger, conversion or consolidation.
SECTION 6.13 Preferential Collection of Claims
Against the Issuer. The Trustee shall comply with Section 311(a)
of the Trust Indenture Act of 1939, excluding any creditor
relationship listed in Section 311(b) of the Trust Indenture Act
of 1939. A Trustee who has resigned or been removed shall be
subject to Section 311(a) of the Trust Indenture Act of 1939 to
the extent indicated therein.
SECTION 6.14 Appointment of Authenticating Agent.
As long as any Securities of a series remain Outstanding, the
Trustee may, by an instrument in writing, appoint with the
approval of the Issuer an authenticating agent (the
"Authenticating Agent") which shall be authorized to act on
behalf of the Trustee to authenticate Securities, including
Securities issued upon exchange, registration of transfer,
partial redemption or pursuant to Section 2.9. Securities of each
such series authenticated by such Authenticating Agent shall be
entitled to the benefits of this Indenture and shall be valid and
obligatory for all purposes as if authenticated by the Trustee.
Whenever reference is made in this Indenture to the
authentication and delivery of Securities of any series by the
Trustee or to 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 for such
series and a Certificate of Authentication executed on behalf of
the Trustee by such Authenticating Agent. Such Authenticating
Agent shall at all times be a corporation organized and doing
business under the laws of the United States of America or of any
state or the District of Columbia, authorized under such laws to
exercise corporate trust powers, having a combined capital and
surplus of at least $25,000,000 (determined as provided in
Section 6.9 with respect to the Trustee) and subject to
supervision or examination by federal or state authority.
Any corporation into which any 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 any Authenticating Agent shall be a party,
or any corporation succeeding to the corporate agency business of
any Authenticating Agent, shall continue to be the Authenticating
Agent with respect to all series of Securities for which it
served as Authenticating Agent without the execution or filing of
any paper or any further act on the part of the Trustee or such
Authenticating Agent. Any Authenticating Agent may at any time,
and if it shall cease to be eligible shall, resign by giving
written notice of resignation to the Trustee and to the Issuer.
The Trustee may at any time terminate the agency of an
Authenticating Agent by giving written notice thereof to such
Authenticating Agent and to the Issuer.
Upon receiving such a notice of resignation or upon
such a termination, or in case at any time any Authenticating
Agent shall cease to be eligible in accordance with the
provisions of this Section 6.14 with respect to one or more
series of Securities, the Trustee may appoint a successor
Authenticating Agent which shall be acceptable to the Issuer and
the Issuer shall provide notice of such appointment to all
Holders of Securities of such series in the manner and to the
extent provided in Section 11.4. Any successor Authenticating
Agent upon acceptance of its appointment hereunder shall become
vested with all rights, powers, duties and responsibilities of
its predecessor hereunder, with like effect as if originally
named as Authenticating Agent. The Issuer agrees to pay to the
Authenticating Agent for such series from time to time reasonable
compensation. The Authenticating Agent for the Securities of any
series shall have no responsibility or liability for any action
taken by it as such at the direction of the Trustee.
Sections 6.2, 6.3, 6.4 and 7.3 shall be applicable
to any Authenticating Agent.
ARTICLE SEVEN
CONCERNING THE SECURITYHOLDERS
SECTION 7.1 Evidence of Action Taken by
Securityholders. Any request, demand, authorization, direction,
notice, consent, waiver or other action provided by this
Indenture to be given or taken by a specified percentage in
principal amount of the Securityholders of any or all series may
be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such specified percentage
of Securityholders in person or by agent duly appointed in
writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments
are delivered to the Trustee. Proof of execution of any
instrument or of a writing appointing any such agent shall be
sufficient for any purpose of this Indenture and (subject to
Sections 6.1 and 6.2) conclusive in favor of the Trustee and the
Issuer, if made in the manner provided in this Article Seven.
SECTION 7.2 Proof of Execution of Instruments and
of Holding of Securities. Subject to Sections 6.1 and 6.2, the
execution of any instrument by a Securityholder or his agent or
proxy may be proved in the following manner:
(a) The fact and date of the execution by any
Holder of any instrument may be proved by the certificate of any
notary public or other officer of any jurisdiction authorized to
take acknowledgments of deeds or administer oaths that the person
executing such instruments acknowledged to him the execution
thereof, or by an affidavit of a witness to such execution sworn
to before any such notary or other such officer. Where such
execution is by or on behalf of any legal entity other than an
individual, such certificate or affidavit shall also constitute
sufficient proof of the authority of the person executing the
same.
(b) The ownership of Securities shall be proved by
the Security register or by a certificate of the Security
registrar.
SECTION 7.3 Holders to be Treated as Owners. The
Issuer, the Trustee and any agent of the Issuer or the Trustee
may deem and treat the Person in whose name any Security shall be
registered upon the Security register for such series as the
absolute owner of such Security (whether or not such Security
shall be overdue and notwithstanding any notation of ownership or
other writing thereon) for the purpose of receiving payment of or
on account of the principal of and, subject to the provisions of
this Indenture, interest, if any, on such Security and for all
other purposes; and neither the Issuer nor the Trustee nor any
agent of the Issuer or the Trustee shall be affected by any
notice to the contrary.
SECTION 7.4 Securities Owned by Issuer Deemed Not
Outstanding. In determining whether the Holders of the requisite
aggregate principal amount of Outstanding Securities of any or
all series have concurred in any direction, consent or waiver
under this Indenture, Securities which are owned by the Issuer,
by any Affiliate of the Issuer or by any other obligor on the
Securities with respect to which such determination is being made
shall be disregarded and deemed not to be Outstanding for the
purpose of any such determination, except that for the purpose of
determining whether the Trustee shall be protected in relying on
any such direction, consent or waiver only Securities which a
Responsible Officer of the Trustee knows are so owned shall be so
disregarded. Securities so owned which have been pledged in good
faith may be regarded as Outstanding if the pledgee establishes
to the satisfaction of the Trustee the pledgee's right so to act
with respect to such Securities and that the pledgee is not the
Issuer or any other obligor upon the Securities or any Affiliate
of the Issuer or any other obligor on the Securities. In case of
a dispute as to such right, the advice of counsel shall be full
protection in respect of any decision made by the Trustee in
accordance with such advice. Upon request of the Trustee, the
Issuer shall furnish to the Trustee promptly an Officers'
Certificate listing and identifying all Securities, if any, known
by the Issuer to be owned or held by or for the account of any of
the above-described Persons; and, subject to Sections 6.1 and
6.2, the Trustee shall be entitled to accept such Officers'
Certificate as conclusive evidence of the facts therein set forth
and of the fact that all Securities not listed therein are
Outstanding for the purpose of any such determination.
SECTION 7.5 Right of Revocation of Action Taken.
At any time prior to (but not after) the evidencing to the
Trustee, as provided in Section 7.1, of the taking of any action
by the Holders of the percentage in aggregate principal amount of
the Securities of any or all series, as the case may be,
specified in this Indenture in connection with such action, any
Holder of a Security the serial number of which is shown by the
evidence to be included among the serial numbers of the
Securities the Holders of which have consented to such action
may, by filing written notice at the Corporate Trust Office and
upon proof of holding as provided in this Article Seven, revoke
such action so far as concerns such Security provided that such
revocation shall not become effective until three Business Days
after such filing. Except as aforesaid, any such action taken by
the Holder of any Security shall be conclusive and binding upon
such Holder and upon all future Holders and owners of such
Security and of any Securities issued in exchange or substitution
therefor or on registration of transfer thereof, irrespective of
whether or not any notation in regard thereto is made upon any
such Security. Any action taken by the Holders of the percentage
in aggregate principal amount of the Securities of any or all
series, as the case may be, specified in this Indenture in
connection with such action shall be conclusively binding upon
the Issuer, the Trustee and the Holders of all the Securities
affected by such action.
SECTION 7.6 Record Date for Consents and Waivers.
The Issuer may, but shall not be obligated to, establish a record
date for the purpose of determining the Persons entitled to (i)
waive any past default with respect to the Securities of such
series in accordance with Article Five of the Indenture, (ii)
consent to any supplemental indenture in accordance with Section
8.2 of the Indenture or (iii) waive compliance with any term,
condition or provision of any covenant hereunder. If a record
date is fixed, the Holders on such record date, or their duly
designated proxies, and any such Persons, shall be entitled to
waive any such past default, consent to any such supplemental
indenture or waive compliance with any such term, condition or
provision, whether or not such Holder remains a Holder after such
record date; provided, however, that unless such waiver or
consent is obtained from the Holders, or duly designated proxies,
of the requisite principal amount of Outstanding Securities of
such series prior to the date which is the 180th day after such
record date, any such waiver or consent previously given shall
automatically and without further action by any Holder be
cancelled and of no further effect.
ARTICLE EIGHT
SUPPLEMENTAL INDENTURES
SECTION 8.1 Supplemental Indentures Without
Consent of Securityholders. The Issuer, when authorized by a
Board Resolution (which resolution may provide general terms or
parameters for such action and may provide that the specific
terms of such action may be determined in accordance with or
pursuant to an Issuer Order), and the Trustee may from time to
time and at any time enter into an indenture or indentures
supplemental hereto (which shall conform to the provisions of the
Trust Indenture Act of 1939 as in force at the date of the
execution thereof) for one or more of the following purposes:
(a) to convey, transfer, assign, mortgage or pledge
to the Trustee as security for the Securities of one or more
series any property or assets;
(b) to evidence the succession of another Person to
the Issuer, or successive successions, and the assumption by the
successor Person of the covenants, agreements and obligations of
the Issuer pursuant to Article Nine;
(c) to add to the covenants of the Issuer such
further covenants, restrictions, conditions or provisions as the
Issuer and the Trustee shall consider to be for the protection of
the Holders of all or any series of Securities (and if such
covenants, restrictions, conditions or provisions are to be for
the protection of less than all series of Securities, stating
that the same are expressly being included solely for the
protection of such series) and to make the occurrence, or the
occurrence and continuance, of a default in any such additional
covenants, restrictions, conditions or provisions an Event of
Default permitting the enforcement of all or any of the several
remedies provided in this Indenture as herein set forth;
provided, however, that in respect of any such additional
covenant, restriction, condition or provision such supplemental
indenture may provide for a particular period of grace after
default (which period may be shorter or longer than that allowed
in the case of other defaults) or may provide for an immediate
enforcement upon such an Event of Default or may limit the
remedies available to the Trustee upon such an Event of Default
or may limit the right of the Holders of a majority in aggregate
principal amount of the Securities of such series to waive such
an Event of Default;
(d) to cure any ambiguity or to correct or
supplement any provision contained herein or in any supplemental
indenture which may be defective or inconsistent with any other
provision contained herein or in any supplemental indenture, or
to make any other provisions as the Issuer may deem necessary or
desirable, provided, however, that no such action shall
materially adversely affect the interests of the Holders of the
Securities;
(e) to establish the form or terms of Securities of
any series as permitted by Sections 2.1 and 2.3;
(f) to provide for the issuance of Securities of
any series in coupon form (including Securities registrable as to
principal only) and to provide for exchangeability of such
Securities for the Securities issued hereunder in fully
registered form and to make all appropriate changes for such
purpose;
(g) to modify, eliminate or add to the provisions
of this Indenture to such extent as shall be necessary to effect
the qualification of this Indenture under the Trust Indenture Act
of 1939, or under any similar federal statute hereafter enacted,
and to add to this Indenture such other provisions as may be
expressly permitted by the Trust Indenture Act of 1939,
excluding, however, the provisions referred to in Section
316(a)(2) of the Trust Indenture Act of 1939 as in effect at the
date as of which this instrument was executed or any
corresponding provision provided for in any similar federal
statute hereafter enacted; or
(h) to evidence and provide for the acceptance of
appointment hereunder of a Trustee other than United States Trust
Company of New York as Trustee for a series of Securities 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 6.9 hereof;
(i) subject to Section 8.2 hereof, to add to or
modify the provisions hereof as may be necessary or desirable to
provide for the denomination of Securities in foreign currencies
which shall not adversely affect the interests of the Holders of
the Securities in any material respect;
(j) to modify the covenants or Events of Default of
the Issuer solely in respect of, or add new covenants or Events
of Default of the Issuer that apply solely to, Securities not
Outstanding on the date of such supplemental indenture; and
(k) 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
6.11.
The Trustee is hereby authorized to join with the
Issuer in the execution of any such supplemental indenture, to
make any further appropriate agreements and stipulations which
may be therein contained and to accept the conveyance, transfer,
assignment, mortgage or pledge of any property thereunder, but
the Trustee 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.
Any supplemental indenture authorized by the
provisions of this Section may be executed without the consent of
the Holders of any of the Securities then Outstanding,
notwithstanding any of the provisions of Section 8.2.
SECTION 8.2 Supplemental Indentures with Consent
of Securityholders. With the consent (evidenced as provided in
Article Seven) of the Holders of not less than a majority in
aggregate principal amount of the Securities then Outstanding of
any series affected by such supplemental indenture, the Issuer,
when authorized by a Board Resolution (which resolution may
provide general terms or parameters for such action and may
provide that the specific terms of such action may be determined
in accordance with or pursuant to an Issuer Order), and the
Trustee may, from time to time and at any time, enter into an
indenture or indentures supplemental hereto (which shall conform
to the provisions of the Trust Indenture Act of 1939 as in force
at the date of execution thereof) for the purpose of adding any
provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of any supplemental indenture or
of modifying in any manner the rights of the Holders of the
Securities of such series; provided, that no such supplemental
indenture shall (a) extend the stated final maturity of the
principal of any Security, or reduce the principal amount
thereof, or reduce the rate or extend the time of payment of
interest, if any, thereon (or, in the case of an Original Issue
Discount Security, reduce the rate of accretion of original issue
discount thereon), or reduce or alter the method of computation
of any amount payable on redemption, repayment or purchase by the
Issuer thereof (or the time at which any such redemption,
repayment or purchase may be made), or make the principal thereof
(including any amount in respect of original issue discount), or
interest, if any, thereon payable in any coin or currency other
than that provided in the Securities or in accordance with the
terms of the Securities, or reduce the amount of the principal of
an Original Issue Discount Security that would be due and payable
upon an acceleration of the maturity thereof or the amount
thereof provable in bankruptcy in each case pursuant to Article
Five, or impair or affect the right of any Securityholder to
institute suit for the payment thereof or, if the Securities
provide therefor, any right of repayment or purchase at the
option of the Securityholder, in each case without the consent of
the Holder of each Security so affected, or (b) reduce the
aforesaid percentage of Securities of any series, the consent of
the Holders of which is required for any such supplemental
indenture, without the consent of the Holders of each Security so
affected. No consent of any Holder of any Security shall be
necessary under this Section 8.2 to permit the Trustee and the
Issuer to execute supplemental indentures pursuant to Sections
8.1 and 9.2.
A supplemental indenture which changes or eliminates
any covenant, Event of Default or other provision of this
Indenture which has expressly been included solely for the
benefit of one or more particular series of Securities, or which
modifies the rights of Holders of Securities of such series, with
respect to such covenant or provision, shall be deemed not to
affect the rights under this Indenture of the Holders of
Securities of any other series.
Upon the request of the Issuer, accompanied by a
copy of a resolution of the Board of Directors (which resolution
may provide general terms or parameters for such action and may
provide that the specific terms of such action may be determined
in accordance with or pursuant to an Issuer Order) certified by
the secretary or an assistant secretary of the Issuer authorizing
the execution of any such supplemental indenture, and upon the
filing with the Trustee of evidence of the consent of the Holders
of the Securities as aforesaid and other documents, if any,
required by Section 7.1, the Trustee shall join with the Issuer
in the execution of such supplemental indenture unless such
supplemental indenture affects the Trustee's own rights, duties
or immunities under this Indenture or otherwise, in which case
the Trustee may at its discretion, but shall not be obligated to,
enter into such supplemental indenture.
It shall not be necessary for the consent of the
Securityholders under this Section 8.2 to approve the particular
form of any proposed supplemental indenture, but it shall be
sufficient if such consent shall approve the substance thereof.
Promptly after the execution by the Issuer and the
Trustee of any supplemental indenture pursuant to the provisions
of this Section 8.2, the Issuer (or the Trustee at the request
and expense of the Issuer) shall give notice thereof to the
Holders of then Outstanding Securities of each series affected
thereby, as provided in Section 11.4. Any failure of the Issuer
to give such notice, or any defect therein, shall not, however,
in any way impair or affect the validity of any such supplemental
indenture.
SECTION 8.3 Effect of Supplemental Indenture.
Upon the execution of any supplemental indenture pursuant to the
provisions hereof, this Indenture shall be and shall be deemed to
be modified and amended in accordance therewith and the
respective rights, limitations of rights, obligations, duties and
immunities under this Indenture of the Trustee, the Issuer and
the Holders of Securities of each series affected thereby shall
thereafter be determined, exercised and enforced hereunder
subject in all respects to such modifications and amendments, and
all the terms and conditions of any such supplemental indenture
shall be and shall be deemed to be part of the terms and
conditions of this Indenture for any and all purposes.
SECTION 8.4 Documents to Be Given to Trustee. The
Trustee, subject to the provisions of Sections 6.1 and 6.2, shall
be entitled to receive an Officers' Certificate and an Opinion of
Counsel as conclusive evidence that any supplemental indenture
executed pursuant to this Article Eight complies with the
applicable provisions of this Indenture and that all conditions
precedent to the execution and delivery of such supplemental
indenture have been satisfied.
SECTION 8.5 Notation on Securities in Respect of
Supplemental Indentures. Securities of any series authenticated
and delivered after the execution of any supplemental indenture
pursuant to the provisions of this Article Eight may bear a
notation in form approved by the Trustee for such series as to
any matter provided for by such supplemental indenture or as to
any action taken by Securityholders. If the Issuer or the
Trustee shall so determine, new Securities of any series so
modified as to conform, in the opinion of the Trustee and the
Issuer, to any modification of this Indenture contained in any
such supplemental indenture may be prepared by the Issuer,
authenticated by the Trustee and delivered in exchange for the
Securities of such series then Outstanding.
ARTICLE NINE
CONSOLIDATION, MERGER, SALE, LEASE, EXCHANGE OR OTHER DISPOSITION
SECTION 9.1 Issuer May Consolidate, etc., on
Certain Terms. Subject to the provisions of Section 9.2, nothing
contained in this Indenture or in any of the Securities shall
prevent any consolidation or merger of the Issuer with or into
any other Person or Persons (whether or not affiliated with the
Issuer), or successive consolidations or mergers in which the
Issuer or its successor or successors shall be a party or
parties, or shall prevent any sale, lease, exchange or other
disposition of all or substantially all the property and assets
of the Issuer to any other Person (whether or not affiliated with
the Issuer) authorized to acquire and operate the same; provided,
however, and the Issuer hereby covenants and agrees, that any
such consolidation, merger, sale, lease, exchange or other
disposition shall be upon the conditions that (a) immediately
after giving effect to such consolidation, merger, sale, lease,
exchange or other disposition of the Person (whether the Issuer
or such other Person) formed by or surviving any such
consolidation or merger, or to which such sale, lease, exchange
or other disposition shall have been made, no Event of Default,
and no event which, after notice or lapse of time or both, would
become an Event of Default, shall have occurred and be
continuing; (b) the Person (if other than the Issuer) formed by
or surviving any such consolidation or merger, or to which such
sale, lease, exchange or other disposition shall have been made,
shall be a Person organized under the laws of the United States
of America, any state thereof or the District of Columbia; and
(c) the due and punctual payment of the principal of and
interest, if any, on all the Securities, according to their
tenor, and the due and punctual performance and observance of all
of the covenants and conditions of this Indenture to be performed
by the Issuer, shall be expressly assumed, by supplemental
indenture satisfactory in form to the Trustee executed and
delivered to the Trustee, by the Person (if other than the
Issuer) formed by such consolidation, or into which the Issuer
shall have been merged, or by the Person which shall have
acquired or leased such property.
SECTION 9.2 Successor Corporation to be
Substituted. In case of any such consolidation or merger or any
sale, conveyance or lease of all or substantially all of the
property of the Issuer and upon the assumption by the successor
Person, by supplemental indenture executed and delivered to the
Trustee and satisfactory in form to the Trustee, of the due and
punctual payment of the principal of, premium, if any, and
interest, if any, on all of the Securities and the due and
punctual performance of all of the covenants and conditions of
this Indenture to be performed by the Issuer, such successor
Person shall succeed to and be substituted for the Issuer, with
the same effect as if it had been named herein as the party of
the first part, and the Issuer (including any intervening
successor to the Issuer which shall have become the obligor
hereunder) shall be relieved of any further obligation under this
Indenture and the Securities; provided, however, that in the case
of a sale, lease, exchange or other disposition of the property
and assets of the Issuer (including any such intervening
successor), the Issuer (including any such intervening successor)
shall continue to be liable on its obligations under this
Indenture and the Securities to the extent, but only to the
extent, of liability to pay the principal of and interest, if
any, on the Securities at the time, places and rate prescribed in
this Indenture and the Securities. Such successor Person
thereupon may cause to be signed, and may issue either in its own
name or in the name of the Issuer, any or all of the Securities
issuable hereunder which theretofore shall not have been signed
by the Issuer and delivered to the Trustee; and, upon the order
of such successor Person instead of the Issuer and subject to all
the terms, conditions and limitations in this Indenture
prescribed, the Trustee shall authenticate and shall deliver any
Securities which previously shall have been signed and delivered
by the officers of the Issuer to the Trustee for authentication,
and any Securities which such successor Person thereafter shall
cause to be signed and delivered to the Trustee for that purpose.
All the Securities so issued shall in all respects have the same
legal rank and benefit under this Indenture as the Securities
theretofore or thereafter issued in accordance with the terms of
this Indenture as though all of such Securities had been issued
at the date of the execution hereof.
In case of any such consolidation or merger or any
sale, lease, exchange or other disposition of all or
substantially all of the property and assets of the Issuer, such
changes in phraseology and form (but not in substance) may be
made in the Securities, thereafter to be issued, as may be
appropriate.
SECTION 9.3 Opinion of Counsel to be Given
Trustee. The Trustee, subject to Sections 6.1 and 6.2, shall
receive an Officers' Certificate and Opinion of Counsel as
conclusive evidence that any such consolidation, merger, sale,
lease, exchange or other disposition and any such assumption
complies with the provisions of this Article Nine.
ARTICLE TEN
SATISFACTION AND DISCHARGE OF INDENTURE;
COVENANT DEFEASANCE; UNCLAIMED MONEYS
SECTION 10.1 Satisfaction and Discharge of
Indenture. (a) If at any time (i) the Issuer shall have paid or
caused to be paid the principal of, premium, if any, and
interest, if any, on all the Securities Outstanding (other than
Securities which have been destroyed, lost or stolen and which
have been replaced or paid as provided in Section 2.9) as and
when the same shall have become due and payable, or (ii) the
Issuer shall have delivered to the Trustee for cancellation all
Securities theretofore authenticated (other than Securities which
have been destroyed, lost or stolen and which have been replaced
or paid as provided in Section 2.9); and if, in any such case,
the Issuer shall also pay or cause to be paid all other sums
payable hereunder by the Issuer (including all amounts payable to
the Trustee pursuant to Section 6.6), then this Indenture shall
cease to be of further effect, and the Trustee, on demand of the
Issuer accompanied by an Officers' Certificate and an Opinion of
Counsel, each stating that all conditions precedent relating to
the satisfaction and discharge contemplated by this provision
have been complied with, and at the cost and expense of the
Issuer, shall execute proper instruments acknowledging such
satisfaction and discharging this Indenture. The Issuer agrees
to reimburse the Trustee for any costs or expenses thereafter
reasonably and properly incurred, and to compensate the Trustee
for any services thereafter reasonably and properly rendered, by
the Trustee in connection with this Indenture or the Securities.
(b) If at any time (i) the Issuer shall have paid
or caused to be paid the principal of, premium, if any, and
interest, if any, on all the Securities of any series Outstanding
(other than Securities of such series which have been destroyed,
lost or stolen and which have been replaced or paid as provided
in Section 2.9) as and when the same shall have become due and
payable, or (ii) the Issuer shall have delivered to the Trustee
for cancellation all Securities of any series theretofore
authenticated (other than any Securities of such series which
have been destroyed, lost or stolen and which have been replaced
or paid as provided in Section 2.9), or (iii) in the case of any
series of Securities with respect to which the exact amount
described in clause (B) below can be determined at the time of
making the deposit referred to in such clause (B), (A) all the
Securities of such series not theretofore delivered to the
Trustee for cancellation shall have become due and payable, or by
their terms are to become due and payable within one year or are
to be called for redemption within one year under arrangements
satisfactory to the Trustee for the giving of notice of
redemption, and (B) the Issuer shall have irrevocably deposited
or caused to be deposited with the Trustee as funds in trust,
specifically pledged as security for, and dedicated solely to,
the benefit of the Holders of Securities of such series, cash in
an amount (other than moneys repaid by the Trustee or any paying
agent to the Issuer in accordance with Section 10.4) or non-
callable, non-prepayable bonds, notes, bills or other similar
obligations issued or guaranteed by the United States government
or any agency thereof the full and timely payment of which are
backed by the full faith and credit of the United States ("U.S.
Government Obligations"), maturing as to principal and interest,
if any, at such times and in such amounts as will insure the
availability of cash, or a combination thereof, sufficient in the
opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereof
delivered to the Trustee, to pay (1) the principal of, premium,
if any, and interest, if any, on all Securities of such series on
each date that such principal of, premium, if any, or interest,
if any, is due and payable, and (2) any mandatory sinking fund
payments on the dates on which such payments are due and payable
in accordance with the terms of the Indenture and the Securities
of such series; then the Issuer shall be deemed to have paid and
discharged the entire indebtedness on all the Securities of such
series on the date of the deposit referred to in clause (B) above
and the provisions of this Indenture with respect to the
Securities of such series shall no longer be in effect (except,
in the case of clause (iii) of this Section 10.1(b), as to (I)
rights of registration of transfer and exchange of Securities of
such series, (II) rights of substitution of mutilated, defaced,
destroyed, lost or stolen Securities of such series, (III) rights
of Holders of Securities of such series to receive payments of
principal thereof and premium, if any, and interest, if any,
thereon upon the original stated due dates therefor (but not upon
acceleration), and remaining rights of the Holders of Securities
of such series to receive mandatory sinking fund payments
thereon, if any, when due, (IV) the rights, obligations, duties
and immunities of the Trustee hereunder, (V) the rights of the
Holders of Securities of such series as beneficiaries hereof with
respect to the property so deposited with the Trustee payable to
all or any of them and (VI) the obligations of the Issuer under
Section 3.2 with respect to Securities of such series) and the
Trustee, on demand of the Issuer accompanied by an Officers'
Certificate and an Opinion of Counsel, each stating that all
conditions precedent contemplated by this provision have been
complied with, and at the cost and expense of the Issuer, shall
execute proper instruments acknowledging the same.
(c) The following provisions shall apply to the
Securities of each series unless specifically otherwise provided
in a Board Resolution, Officers' Certificate or indenture
supplemental hereto provided pursuant to Section 2.3. In addition
to discharge of the Indenture pursuant to the next preceding
paragraph, in the case of any series of Securities with respect
to which the exact amount described in subparagraph (A) below can
be determined at the time of making the deposit referred to in
such subparagraph (A), the Issuer shall be deemed to have paid
and discharged the entire indebtedness on all the Securities of
such a series on the 91st day after the date of the deposit
referred to in subparagraph (A) below, and the provisions of this
Indenture with respect to the Securities of such series shall no
longer be in effect (except as to (i) rights of registration of
transfer and exchange of Securities of such series, (ii)
substitution of mutilated, defaced, destroyed, lost or stolen
Securities of such series, (iii) rights of Holders of Securities
of such series to receive payments of principal thereof, premium,
if any, and interest, if any, thereon upon the original stated
due dates therefor (but not upon acceleration), and remaining
rights of the Holders of Securities of such series to receive
mandatory sinking fund payments, if any, (iv) the rights,
obligations, duties and immunities of the Trustee hereunder, (v)
the rights of the Holders of Securities of such series as
beneficiaries hereof with respect to the property so deposited
with the Trustee payable to all or any of them and (vi) the
obligations of the Issuer under Section 3.2 with respect to
Securities of such series) and the Trustee, on demand of the
Issuer accompanied by an Officers' Certificate and an Opinion of
Counsel, each stating that all conditions precedent contemplated
by this provision have been complied with, and at the cost and
expense of the Issuer, shall execute proper instruments
acknowledging the same, if
(A) with reference to this provision the Issuer has
irrevocably deposited or caused to be irrevocably deposited
with the Trustee as funds in trust, specifically pledged as
security for, and dedicated solely to, the benefit of the
Holders of Securities of such series (1) cash in an amount,
or (2) U.S. Government Obligations, maturing as to principal
and interest, if any, at such times and in such amounts as
will insure the availability of cash, or (3) a combination
thereof, sufficient, in the opinion of a nationally
recognized firm of independent public accountants expressed
in a written certification thereof delivered to the Trustee,
to pay (I) the principal of, premium, if any, and interest,
if any, on all Securities of such series on each date that
such principal or interest, if any, is due and payable, and
(II) any mandatory sinking fund payments on the dates on
which such payments are due and payable in accordance with
the terms of the Indenture and the Securities of such
series;
(B) such deposit will not result in a breach or
violation of, or constitute a default under, any agreement
or instrument to which the Issuer is a party or by which it
is bound; and
(C) the Issuer has delivered to the Trustee an
Opinion of Counsel based on the fact that (1) the Issuer has
received from, or there has been published by, the Internal
Revenue Service a ruling or (2), since the date hereof,
there has been a change in the applicable United States
federal income tax law, in either case to the effect that,
and such opinion shall confirm that, the Holders of the
Securities of such series will not recognize income, gain or
loss for Federal income tax purposes as a result of such
deposit, defeasance and discharge and will be subject to
Federal income tax on the same amount and in the same manner
and at the same times, as would have been the case if such
deposit, defeasance and discharge had not occurred.
SECTION 10.2 Application by Trustee of Funds
Deposited for Payment of Securities. Subject to Section 10.4,
all moneys and U.S. Government Obligations deposited with the
Trustee pursuant to Section 10.1 shall be held in trust, and such
moneys and all moneys from such U.S. Government Obligations shall
be applied by it to the payment, either directly or through any
paying agent (including the Issuer acting as its own paying
agent), to the Holders of the particular Securities of such
series for the payment or redemption of which such moneys and
U.S. Government Obligations have been deposited with the Trustee,
of all sums due and to become due thereon for principal and
interest, if any, but such moneys and U.S. Government Obligations
need not be segregated from other funds except to the extent
required by law.
SECTION 10.3 Repayment of Moneys Held by Paying
Agent. In connection with the satisfaction and discharge of this
Indenture with respect to Securities of any series, all moneys
then held by any paying agent under the provisions of this
Indenture with respect to such series of Securities shall, upon
demand of the Issuer, be repaid to it or paid to the Trustee and
thereupon such paying agent shall be released from all further
liability with respect to such moneys.
SECTION 10.4 Return of Moneys Held by Trustee and
Paying Agent Unclaimed for Two Years. Any moneys deposited with
or paid to the Trustee or any paying agent for the payment of the
principal of, premium, if any, or interest, if any, on any
Security of any series and not applied but remaining unclaimed
for two years after the date upon which such principal, premium,
if any, or interest, if any, shall have become due and payable,
shall, upon the written request of the Issuer and unless
otherwise required by mandatory provisions of applicable escheat
or abandoned or unclaimed property law, be repaid to the Issuer
by the Trustee for such series or such paying agent and the
Holder of the Securities of such series shall, unless otherwise
required by mandatory provisions of applicable escheat or
abandoned or unclaimed property laws, thereafter look only to the
Issuer for any payment which such Holder may be entitled to
collect, and all liability of the Trustee or any paying agent
with respect to such moneys shall thereupon cease.
SECTION 10.5 Indemnity for U.S. Government
Obligations. The Issuer shall pay and indemnify the Trustee
against any tax, fee or other charge imposed on or assessed
against the U.S. Government Obligations deposited pursuant to
Section 10.1 or the principal or interest received in respect of
such obligations.
ARTICLE ELEVEN
MISCELLANEOUS PROVISIONS
SECTION 11.1 Partners, Incorporators,
Stockholders, Officers and Directors of Issuer Exempt from
Individual Liability. No recourse under or upon any obligation,
covenant or agreement contained in this Indenture, or in any
Security, or because of any indebtedness evidenced thereby, shall
be had against any incorporator, as such or against any past,
present or future stockholder, officer or director, as such, of
the Issuer, or any partner of the Issuer or of any successor,
either directly or through the Issuer or any successor, under any
rule of law, statute or constitutional provision or by the
enforcement of any assessment or by any legal or equitable
proceeding or otherwise, all such liability being expressly
waived and released by the acceptance of the Securities by the
Holders thereof and as part of the consideration for the issue of
the Securities.
SECTION 11.2 Provisions of Indenture for the Sole
Benefit of Parties and Holders of Securities. Nothing in this
Indenture or in the Securities, expressed or implied, shall give
or be construed to give to any Person, other than the parties
hereto and their successors and the Holders of the Senior
Indebtedness and the Holders of the Securities, any legal or
equitable right, remedy or claim under this Indenture or under
any covenant or provision herein contained, all such covenants
and provisions being for the sole benefit of the parties hereto
and their successors and of the Holders of the Securities.
SECTION 11.3 Successors and Assigns of Issuer
Bound by Indenture. All the covenants, stipulations, promises
and agreements in this Indenture contained by or on behalf of the
Issuer shall bind its successors and assigns, whether so
expressed or not.
SECTION 11.4 Notices and Demands on Issuer,
Trustee and Holders of Securities. Any notice or demand which by
any provision of this Indenture is required or permitted to be
given or served by the Trustee or by the Holders of Securities to
or on the Issuer, or as required pursuant to the Trust Indenture
Act of 1939, may be given or served by being deposited postage
prepaid, first-class mail (except as otherwise specifically
provided herein) addressed (until another address of the Issuer
is filed by the Issuer with the Trustee) to Triton Energy
Corporation, 6688 North Central Expressway, Suite 1400, Dallas,
Texas 75206-9926, Attention: Chairman of the Board. Any notice,
direction, request or demand by the Issuer or any Holder of
Securities to or upon the Trustee shall be deemed to have been
sufficiently given or served by being deposited postage prepaid,
first-class mail (except as otherwise specifically provided
herein) addressed (until another address of the Trustee is filed
by the Trustee with the Issuer) to United States Trust Company of
New York, 114 West 47th Street, New York, New York 10036,
Attention: Corporate Trust Department.
Where this Indenture provides for notice to Holders
of Securities, such notice shall be sufficiently given (unless
otherwise herein expressly provided) if in writing and mailed,
first-class postage prepaid, to each Holder entitled thereto, at
his last address as it appears in the Security register. Where
this Indenture provides for notice in any manner, such notice may
be waived in writing by the Person entitled to receive such
notice, either before or after the event, and such waiver shall
be the equivalent of such notice. Waivers of notice by Holders
shall be filed with the Trustee, but such filing shall not be a
condition precedent to the validity of any action taken in
reliance upon such waiver.
In case, by reason of the suspension of or
irregularities in regular mail service, it shall be impracticable
to mail notice to the Issuer when such notice is required to be
given pursuant to any provision of this Indenture, then any
manner of giving such notice as shall be reasonably satisfactory
to the Trustee shall be deemed to be sufficient notice.
SECTION 11.5 Officers' Certificates and Opinions
of Counsel; Statements to Be Contained Therein. Upon any
application or demand by the Issuer to the Trustee to take any
action under any of the provisions of this Indenture, or as
required pursuant to the Trust Indenture Act of 1939, the Issuer
shall furnish to the Trustee an Officers' Certificate stating
that all conditions precedent 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 have been complied with, except
that in the case of any such application or demand as to which
the furnishing of such documents is specifically required by any
provision of this Indenture relating to such particular
application or demand, no additional certificate or opinion need
be furnished.
Each certificate or opinion provided for in this
Indenture (other than a certificate provided pursuant to Section
4.3(d)) and delivered to the Trustee with respect to compliance
with a condition or covenant provided for in this Indenture shall
include (a) a statement that the person making such certificate
or opinion has read such covenant or condition, (b) a brief
statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in
such certificate or opinion are based, (c) a statement that, in
the opinion of such person, he has made such examination or
investigation as is necessary to enable him to express an opinion
as to whether or not such covenant or condition has been complied
with, and (d) a statement as to whether or not, in the opinion of
such person, such condition or covenant has been complied with.
Any certificate, statement or opinion of an officer
of the Issuer may be based, insofar as it relates to legal
matters, upon a certificate or opinion of or representations by
counsel, unless such officer knows that the certificate or
opinion or representations with respect to the matters upon which
his certificate, statement or opinion may be based as aforesaid
are erroneous, or in the exercise of reasonable care should know
that the same are erroneous. Any certificate, statement or
opinion of counsel may be based, insofar as it relates to factual
matters, on information with respect to which is in the
possession of the Issuer, upon the certificate, statement or
opinion of or representations by an officer or officers of the
Issuer, unless such counsel knows that the certificate, statement
or opinion or representations with respect to the matters upon
which his certificate, statement or opinion may be based as
aforesaid are erroneous, or in the exercise of reasonable care
should know that the same are erroneous.
Any certificate, statement or opinion of an officer
of the Issuer or of counsel may be based, insofar as it relates
to accounting matters, upon a certificate or opinion of or
representations by an accountant or firm of accountants in the
employ of the Issuer, unless such officer or counsel, as the case
may be, knows that the certificate or opinion or representations
with respect to the accounting matters upon which his
certificate, statement or opinion may be based as aforesaid are
erroneous, or in the exercise of reasonable care should know that
the same are erroneous.
Any certificate or opinion of any independent firm
of public accountants filed with and directed to the Trustee
shall contain a statement that such firm is independent.
SECTION 11.6 Payments Due on Saturdays, Sundays
and Holidays. If the date of maturity of principal of or
interest, if any, on the Securities of any series or the date
fixed for redemption, purchase or repayment of any such Security
shall not be a Business Day, then payment of interest, if any,
premium, if any, or principal need not be made on such date, but
may be made on the next succeeding Business Day with the same
force and effect as if made on the date of maturity or the date
fixed for redemption, purchase or repayment, and, in the case of
payment, no interest shall accrue for the period after such date.
SECTION 11.7 Conflict of Any Provision of
Indenture with Trust Indenture Act of 1939. If and to the extent
that any provision of this Indenture limits, qualifies or
conflicts with another provision included in this Indenture which
is required to be included herein by any of Sections 310 to 317,
inclusive, or is deemed applicable to this Indenture by virtue of
the provisions, of the Trust Indenture Act of 1939, such required
provision shall control.
SECTION 11.8 GOVERNING LAW. THIS INDENTURE AND
EACH SECURITY SHALL BE DEEMED TO BE A CONTRACT UNDER THE LAWS OF
THE STATE OF NEW YORK AND FOR ALL PURPOSES SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF SUCH STATE, WITHOUT
REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS.
SECTION 11.9 Counterparts. This Indenture may be
executed in any number of counterparts, each of which shall be an
original; but such counterparts shall together constitute but one
and the same instrument.
SECTION 11.10 Effect of Headings. The Article and
Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
ARTICLE TWELVE
REDEMPTION OF SECURITIES AND SINKING FUNDS
SECTION 12.1 Applicability of Article. The
provisions of this Article shall be applicable to the Securities
of any series which are redeemable before their maturity or to
any sinking fund for the retirement of Securities of a series
except as otherwise specified, as contemplated by Section 2.3 for
Securities of such series.
SECTION 12.2 Notice of Redemption; Partial
Redemptions. Notice of redemption to the Holders of Securities
of any series to be redeemed as a whole or in part at the option
of the Issuer shall be given by mailing notice of such redemption
by first class mail, postage prepaid, at least 30 days and not
more than 60 days prior to the date fixed for redemption to such
Holders of Securities of such series at their last addresses as
they shall appear in the Security register. Any notice which is
mailed in the manner herein provided shall be conclusively
presumed to have been duly given, whether or not the Holder
receives the notice. Failure to give notice by mail, or any
defect in the notice to the Holder of any Security of a series
designated for redemption as a whole or in part shall not affect
the validity of the proceedings for the redemption of any other
Security of such series.
The notice of redemption to each such Holder shall
specify (i) the principal amount of each Security of such series
held by such Holder to be redeemed, (ii) the date fixed for
redemption, (iii) the redemption price, (iv) the place or places
of payment, (v) the CUSIP number relating to such Securities,
(vi) that payment will be made upon presentation and surrender of
such Securities, (vii) whether such redemption is pursuant to the
mandatory or optional sinking fund, or both, if such be the case,
(viii) whether interest, if any, (or, in the case of Original
Issue Discount Securities, original issue discount) accrued to
the date fixed for redemption will be paid as specified in such
notice and (ix) whether on and after said date interest, if any,
(or, in the case of Original Issue Discount Securities, original
issue discount) thereon or on the portions thereof to be redeemed
will cease to accrue. In case any Security of a series is to be
redeemed in part only, the notice of redemption shall state the
portion of the principal amount thereof to be redeemed and shall
state that on and after the date fixed for redemption, upon
surrender of such Security, a new Security or Securities of such
series in principal amount equal to the unredeemed portion
thereof will be issued.
The notice of redemption of Securities of any series
to be redeemed at the option of the Issuer shall be given by the
Issuer or, at the Issuer's request, by the Trustee in the name
and at the expense of the Issuer.
On or before the redemption date specified in the
notice of redemption given as provided in this Section 12.2, the
Issuer will deposit with the Trustee or with one or more paying
agents (or, if the Issuer is acting as its own paying agent, set
aside, segregate and hold in trust as provided in Section 3.5) an
amount of money sufficient to redeem on the redemption date all
the Securities of such series so called for redemption at the
appropriate redemption price, together with accrued interest, if
any, to the date fixed for redemption. The Issuer will deliver to
the Trustee at least 45 days prior to the date fixed for
redemption (unless a shorter notice period shall be satisfactory
to the Trustee) an Officers' Certificate stating the aggregate
principal amount of Securities to be redeemed. In case of a
redemption at the election of the Issuer prior to the expiration
of any restriction on such redemption, the Issuer shall deliver
to the Trustee, prior to the giving of any notice of redemption
to Holders pursuant to this Section, an Officers' Certificate
stating that such restriction has been complied with.
If less than all the Securities of a series are to
be redeemed, the Trustee shall select, in such manner as it shall
deem appropriate and fair, Securities of such series to be
redeemed. Securities may be redeemed in part in multiples equal
to the minimum authorized denomination for Securities of such
series or any multiple thereof. The Trustee shall promptly
notify the Issuer in writing of the Securities of such series
selected for redemption and, in the case of any Securities of
such series 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 of any series shall relate, in the
case of any Security redeemed or to be redeemed only in part, to
the portion of the principal amount of such Security which has
been or is to be redeemed.
SECTION 12.3 Payment of Securities Called for
Redemption. If notice of redemption has been given as provided
by this Article Twelve, the Securities or portions of Securities
specified in such notice shall become due and payable on the date
and at the place or places stated in such notice at the
applicable redemption price, together with interest, if any,
accrued to the date fixed for redemption, and on and after said
date (unless the Issuer shall default in the payment of such
Securities at the redemption price, together with interest, if
any, accrued to said date) interest, if any (or, in the case of
Original Issue Discount Securities, original issue discount) on
the Securities or portions of Securities so called for redemption
shall cease to accrue, and such Securities shall cease from and
after the date fixed for redemption (unless an earlier date shall
be specified in a Board Resolution, Officers' Certificate or
executed supplemental indenture referred to in Sections 2.1 and
2.3 by or pursuant to which the form and terms of the Securities
of such series were established) except as provided in Sections
6.5 and 10.4, to be entitled to any benefit or security under
this Indenture, and the Holders thereof shall have no right in
respect of such Securities except the right to receive the
redemption price thereof and unpaid interest, if any, to the date
fixed for redemption. On presentation and surrender of such
Securities at a place of payment specified in said notice, said
Securities or the specified portions thereof shall be paid and
redeemed by the Issuer at the applicable redemption price,
together with interest, if any, accrued thereon to the date fixed
for redemption; provided that payment of interest, if any,
becoming due on or prior to the date fixed for redemption shall
be payable to the Holders of Securities registered as such on the
relevant record date subject to the terms and provisions of
Sections 2.3 and 2.7 hereof.
If any Security called for redemption shall not be
so paid upon surrender thereof for redemption, the redemption
price shall, until paid or duly provided for, bear interest from
the date fixed for redemption at the rate of interest or Yield to
Maturity (in the case of an Original Issue Discount Security)
borne by such Security.
Upon presentation of any Security redeemed in part
only, the Issuer shall execute and the Trustee shall authenticate
and deliver to or on the order of the Holder thereof, at the
expense of the Issuer, a new Security or Securities of such
series, and of like tenor, of authorized denominations, in
principal amount equal to the unredeemed portion of the Security
so presented.
SECTION 12.4 Exclusion of Certain Securities from
Eligibility for Selection for Redemption. Securities shall be
excluded from eligibility for selection for redemption if they
are identified by registration and certificate number in an
Officers' Certificate delivered to the Trustee at least 45 days
prior to the last date on which notice of redemption may be given
as being owned of record and beneficially by, and not pledged or
hypothecated by either (a) the Issuer, or (b) a Person
specifically identified in such written statement as an Affiliate
of the Issuer.
SECTION 12.5 Mandatory and Optional Sinking Funds.
The minimum amount of any sinking fund payment provided for by
the terms of the 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 the
Securities of any series is herein referred to as an "optional
sinking fund payment." The date on which a sinking fund payment
is to be made is herein referred to as the "sinking fund payment
date."
In lieu of making all or any part of any mandatory
sinking fund payment with respect to any series of Securities in
cash, the Issuer may at its option (a) deliver to the Trustee
Securities of such series theretofore purchased or otherwise
acquired (except upon redemption pursuant to the mandatory
sinking fund) by the Issuer or receive credit for Securities of
such series (not previously so credited) theretofore purchased or
otherwise acquired (except as aforesaid) by the Issuer and
delivered to the Trustee for cancellation pursuant to Section
2.10, (b) receive credit for optional sinking fund payments (not
previously so, credited) made pursuant to this Section 12.5, or
(c) receive credit for Securities of such series (not previously
so credited) redeemed by the Issuer through any optional
redemption provision contained in the terms of such series.
Securities so delivered or credited shall be received or credited
by the Trustee at the sinking fund redemption price specified in
such Securities.
On or before the 60th day next preceding each
sinking fund payment date for any series, the Issuer will deliver
to the Trustee an Officers' Certificate (a) specifying the
portion of the mandatory sinking fund payment to be satisfied by
payment of cash and the portion to be satisfied by credit of
Securities of such series and the basis for such credit, (b)
stating that none of the Securities of such series to be so
credited has theretofore been so credited, (c) stating that no
defaults in the payment of interest or Events of Default with
respect to such series have occurred (which have not been waived
or cured or otherwise ceased to exist) and are continuing, and
(d) stating whether or not the Issuer intends to exercise its
right to make an optional sinking fund payment with respect to
such series and, if so, specifying the amount of such optional
sinking fund payment which the Issuer intends to pay on or before
the next succeeding sinking fund payment date. Any Securities of
such series to be credited and required to be delivered to the
Trustee in order for the Issuer to be entitled to credit therefor
as aforesaid which have not theretofore been delivered to the
Trustee shall be delivered for cancellation pursuant to Section
2.10 to the Trustee with such Officers' Certificate (or
reasonably promptly thereafter if acceptable to the Trustee).
Such Officers' Certificate shall be irrevocable and upon its
receipt by the Trustee the Issuer shall become unconditionally
obligated to make all the cash payments or payments therein
referred to, if any, on or before the next succeeding sinking
fund payment date. Failure of the Issuer, on or before any such
60th day, to deliver such Officers' Certificate and Securities
(subject to the parenthetical clause in the second preceding
sentence) specified in this paragraph, if any, shall not
constitute a default but shall constitute, on and as of such
date, the irrevocable election of the Issuer (i) that the
mandatory sinking fund payment for such series due on the next
succeeding sinking fund payment date shall be paid entirely in
cash without the option to deliver or credit Securities of such
series in respect thereof, and (ii) that the Issuer will make no
optional sinking fund payment with respect to such series as
provided in this Section 12.5.
If the sinking fund payment or payments (mandatory
or optional or both) to be made in cash on the next succeeding
sinking fund payment date plus any unused balance of any
preceding sinking fund payments made in cash shall exceed
$50,000, or a lesser sum if the Issuer shall so request with
respect to the Securities of any particular series, such cash
shall be applied on the next succeeding sinking fund payment date
to the redemption of Securities of such series at the sinking
fund redemption price together with accrued interest, if any, to
the date fixed for redemption. If such amount shall be $50,000
or less and the Issuer makes no such request, then it shall be
carried over until a sum in excess of $50,000 is available. The
Trustee shall select, in the manner provided in Section 12.2, for
redemption on such sinking fund payment date a sufficient
principal amount of Securities of such series to absorb said
cash, as nearly as may be, and shall (if requested in writing by
the Issuer) inform the Issuer of the serial numbers of the
Securities of such series (or portions thereof) so selected. The
Issuer, or the Trustee, in the name and at the expense of the
Issuer (if the Issuer shall so request the Trustee in writing)
shall cause notice of redemption of the Securities of such series
to be given in substantially the manner provided in Section 12.2
(and with the effect provided in Section 12.3) for the redemption
of Securities of such series in part at the option of the Issuer.
The amount of any sinking fund payments not so applied or
allocated to the redemption of Securities of such series shall be
added to the next cash sinking fund payment for such series and,
together with such payment, shall be applied in accordance with
the provisions of this Section 12.5. Any and all sinking fund
moneys held on the stated maturity date of the Securities of any
particular series (or earlier, if such maturity is accelerated),
which are not held for the payment or redemption of particular
Securities of such series shall be applied, together with other
moneys, if necessary, sufficient for the purpose, to the payment
of the principal of, and interest, if any, on, the Securities of
such series at maturity.
On or before each sinking fund payment date, the
Issuer shall pay to the Trustee in cash or shall otherwise
provide for the payment of all interest, if any, accrued to the
date fixed for redemption on Securities to be redeemed on such
sinking fund payment date.
The Trustee shall not redeem or cause to be redeemed
any Securities of a series with sinking fund moneys or give any
notice of redemption of Securities for such series by operation
of the sinking fund during the continuance of a default in
payment of interest on such Securities or of any Event of Default
with respect to such series except that, where the giving of
notice of redemption of any Securities shall theretofore have
been made, the Trustee shall redeem or cause to be redeemed such
Securities, provided that it shall have received from the Issuer
a sum sufficient for such redemption. Except as aforesaid, and
subject to Article Thirteen, any moneys in the sinking fund for
such series at the time when any such default or Event of Default
known to a Responsible Officer of the Trustee shall occur, and
any moneys thereafter paid into the sinking fund, shall, during
the continuance of such default or Event of Default, be deemed to
have been collected under Article Five and held for the payment
of all such Securities. In case such Event of Default shall have
been waived as provided in Article Five or the default cured on
or before the 60th day preceding the sinking fund payment date in
any year, such moneys shall thereafter be applied on the next
succeeding sinking fund payment date in accordance with this
Section to the redemption of such Securities.
ARTICLE THIRTEEN
SUBORDINATION
SECTION 13.1 Securities Subordinated to Senior
Indebtedness. (a) The Issuer covenants and agrees, and each
Holder of Securities of each series, by his acceptance thereof,
likewise covenants and agrees, that anything in this Indenture or
the Securities of any series to the contrary notwithstanding, the
indebtedness evidenced by the Securities of each series is
subordinate and junior in right of payment, to the extent
provided herein, to all Senior Indebtedness, whether outstanding
on the date of execution of this Indenture or thereafter created,
incurred or assumed, and that the subordination is for the
benefit of the holders of Senior Indebtedness but the Securities
shall in all respects rank pari passu with all other Senior
Subordinated Indebtedness of the Issuer. The Securities shall
rank senior to all existing and future Indebtedness of the Issuer
that is neither Senior Indebtedness nor Senior Subordinated
Indebtedness and only Indebtedness of the Issuer that is Senior
Indebtedness shall rank senior to the Securities in accordance
with the provisions set forth herein.
(b) Subject to Section 13.4, if (i) the Issuer
shall default in the payment of any principal of, premium, if
any, or interest, if any, on any Senior Indebtedness when the
same becomes due and payable, whether at maturity or at a date
fixed for prepayment or by declaration of acceleration or
otherwise, or (ii) any other default shall occur with respect to
Senior Indebtedness and the maturity of such Senior Indebtedness
has been accelerated in accordance with its terms, then, upon
written notice of such default to the Issuer and the Trustee by
the holders of Senior Indebtedness or any trustee therefor,
unless and until, in either case, the default has been cured or
waived, and any such acceleration has been rescinded or such
Senior Indebtedness has been paid in full, no direct or indirect
payment (in cash, property, securities, by set-off or otherwise)
shall be made or agreed to be made on account of the principal
of, premium, if any, or interest, if any, on any of the
Securities, or in respect of any redemption, retirement, purchase
or other acquisition of any of the Securities other than those
made in capital stock of the Issuer (or cash in lieu of
fractional shares thereof).
(c) If any default (other than a default described
in paragraph (b) of this Section 13.1) shall occur under the
Senior Indebtedness, pursuant to which the maturity thereof may
be accelerated immediately without further notice (except such
notice as may be required to effect such acceleration) or the
expiration of any applicable grace periods occurs (a "Senior
Nonmonetary Default"), then, upon the receipt by the Issuer and
the Trustee of written notice thereof (a "Payment Notice") from
or on behalf of holders of such Senior Indebtedness specifying an
election to prohibit such payment and other action by the Issuer
in accordance with the following provisions of this paragraph
(c), the Issuer may not make any payment or take any other action
that would be prohibited by paragraph (b) of this Section 13.1
during the period (the "Payment Blockage Period") commencing on
the date of receipt of such Payment Notice and ending on the
earlier of (i) the date, if any, on which the holders of such
Senior Indebtedness or their representative notify the Trustee
that such Senior Nonmonetary Default is cured or waived or ceases
to exist or the Senior Indebtedness to which such Senior
Nonmonetary Default relates is discharged or (ii) the 179th day
after the date of receipt of such Payment Notice.
Notwithstanding the provisions described in the immediately
preceding sentence, the Issuer may resume payments on the
Securities following such Payment Blockage Period.
(d) If (i) (A) without the consent of the Issuer, a
receiver, conservator, liquidator or trustee of the Issuer or of
any of its property is appointed by the order or decree of any
court or agency or supervisory authority having jurisdiction, and
such decree or order remains in effect for more than 60 days or
(B) the Issuer is adjudicated bankrupt or insolvent or (C) any of
its property is sequestered by court order and such order remains
in effect for more than 60 days or (D) a petition is filed
against the Issuer under any state or federal bankruptcy,
reorganization, arrangement, insolvency, readjustment of debt,
dissolution, liquidation or receivership law of any jurisdiction
whether now or hereafter in effect (including without limitation
the Bankruptcy Code), and is not dismissed within 60 days after
such filing; or (ii) the Issuer (A) commences a voluntary case or
other proceeding seeking liquidation, reorganization,
arrangement, insolvency, readjustment of debt, dissolution,
liquidation or other relief with respect to itself or its debt or
other liabilities under any bankruptcy, insolvency or other
similar law now or hereafter in effect (including without
limitation the Bankruptcy Code) or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar
official of it or any substantial part of its property, or (B)
consents to any such relief or to the appointment of or taking
possession by any such official in an involuntary case or other
proceeding commenced against it, or (C) fails generally to, or
cannot, pay its debts generally as they become due or (D) takes
any corporate action to authorize or effect any of the foregoing;
or (iii) any Subsidiary of the Issuer takes, suffers or permits
to exist any of the events or conditions referred to in the
foregoing clause (i) or (ii), then all Senior Indebtedness
(including any interest thereon accruing after the commencement
of any such proceedings) shall first be paid in full before any
payment or distribution, whether in cash, securities or other
property, shall be made to any Holder of any Securities on
account thereof. Any payment or distribution, whether in cash,
securities or other property (other than securities of the Issuer
or any other corporation provided for by a plan of reorganization
or readjustment the payment of which is subordinate, at least to
the extent provided in these subordination provisions with
respect to the indebtedness evidenced by the Securities to the
payment of all Senior Indebtedness then outstanding and to any
securities issued in respect thereof under any such plan of
reorganization or adjustment) which would otherwise (but for
these subordination provisions) be payable or deliverable in
respect of the Securities of any series shall be paid or
delivered directly to the holders of Senior Indebtedness in
accordance with the priorities then existing among such holders
until all Senior Indebtedness (including any interest thereon
accruing after the commencement of any such proceedings) shall
have been paid in full. In the event of any such proceeding,
after payment in full of all sums owing with respect to Senior
Indebtedness, the Holders of the Securities, together with the
holders of any obligations of the Issuer ranking on a parity with
the Securities, shall be entitled to be paid from the remaining
assets of the Issuer the amounts at the time due and owing on
account of unpaid principal of and interest, if any, on the
Securities and such other obligations before any payment or other
distribution, whether in cash, property or otherwise, shall be
made on account of any capital stock or any obligations of the
Issuer ranking junior to the Securities and such other
obligations.
(e) If, notwithstanding the foregoing, any payment
or distribution of any character, whether in cash, securities or
other property (other than securities of the Issuer or any other
corporation provided for by a plan of reorganization or
readjustment the payment of which is subordinate, at least to the
extent provided in the subordination provisions with respect to
the indebtedness evidenced by the Securities, to the payment of
all Senior Indebtedness then outstanding and to any securities
issued in respect thereof under any such plan of reorganization
or readjustment), shall be received by the Trustee or any Holder
in contravention of any of the terms hereof, such payment or
distribution of securities shall be received in trust for the
benefit of and shall be paid over or delivered and transferred to
the holders of the Senior Indebtedness then outstanding in
accordance with the priorities then existing among such holders
for application to the payment of all Senior Indebtedness
remaining unpaid, to the extent necessary to pay all such Senior
Indebtedness in full. In the event of the failure of the Trustee
or any Holder to endorse or assign any such payment, distribution
or security, each holder of Senior Indebtedness is hereby
irrevocably authorized to endorse or assign the same.
(f) No present or future holder of any Senior
Indebtedness shall be prejudiced in the right to enforce
subordination of the indebtedness evidenced by the Securities by
any act or failure to act on the part of the Issuer or any Holder
of Securities. Nothing contained herein shall impair, as between
the Issuer and the Holders of Securities of each series, the
obligation of the Issuer to pay to such Holders the principal of
and interest, if any, on such Securities or prevent the Trustee
or the Holder from exercising all rights, powers and remedies
otherwise permitted by applicable law or hereunder upon a default
or Event of Default hereunder, all subject to the rights of the
holders of the Senior Indebtedness to remove cash, securities or
other property otherwise payable or deliverable to the Holders.
(g) Senior Indebtedness shall not be deemed to have
been paid in full unless the holders thereof shall have received
cash, securities or other property equal to the amount of such
Senior Indebtedness then outstanding. Upon the payment in full
of all Senior Indebtedness, the Holders of Securities of each
series shall be subrogated to all rights of any holders of Senior
Indebtedness to receive any further payment or distributions
applicable to the Senior Indebtedness until the indebtedness
evidenced by the Securities of such series shall have been paid
in full and such payments or distributions received by such
Holders, by reason of such subrogation, of cash, securities or
other property which otherwise would be paid or distributed to
the holders of Senior Indebtedness, shall, as between the Issuer
and its creditors other than the holders of Senior Indebtedness,
on the one hand, and such Holders, on the other hand, be deemed
to be a payment by the Issuer on account of Senior Indebtedness,
and not on account of the Securities of such series.
(h) The provisions of this Section 13.1 shall not
impair any rights, interests, remedies or powers of any secured
creditor of the Issuer in respect of any security interest the
creation of which is not prohibited by the provisions of this
Indenture.
(i) The securing of any obligations of the Issuer,
otherwise ranking on a parity with the Securities or ranking
junior to the Securities, shall not be deemed to prevent such
obligations from constituting, respectively, obligations ranking
on a parity with the Securities or ranking junior to the
Securities.
SECTION 13.2 Reliance on Certificate of
Liquidating Agent; Further Evidence as to Ownership of Senior
Indebtedness. Upon any payment or distribution of assets of the
Issuer, the Trustee and the Holders shall be entitled to rely
upon an order or decree issued by any court of competent
jurisdiction in which such dissolution or winding up or
liquidation or reorganization or arrangement proceedings are
pending or upon a certificate of the bankruptcy trustee,
receiver, assignee for the benefit of creditors or other Person
making such payment or distribution, delivered to the Trustee or
to the Holders, for the purpose of ascertaining the Persons
entitled to participate in such distribution, the holders of the
Senior Indebtedness and other indebtedness of the Issuer, the
amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to
this Article Thirteen. In the absence of any such bankruptcy
trustee, receiver, assignee or other Person, the Trustee shall be
entitled to rely upon written notice by a Person representing
himself to be a holder of Senior Indebtedness (or a trustee or
representative on behalf of such holder) as evidence that such
Person is a holder of Senior Indebtedness (or is such a trustee
or representative). If 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 distributions pursuant to this Article Thirteen,
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 to other facts pertinent to the rights of such
Person under this Article Thirteen, 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 13.3 Payment Permitted If No Default.
Nothing contained in this Article Thirteen or elsewhere in this
Indenture, or in any of the Securities, shall prevent (a) the
Issuer at any time, except during the pendency of any default
with respect to Senior Indebtedness described in Section 13.1(b)
or Section 13.1(c) or of any of the events described in Section
13.1(d), from making payments of the principal of or interest, if
any, on the Securities, or (b) the application by the Trustee or
any paying agent of any moneys deposited with it hereunder to
payments of the principal of or interest, if any, on the
Securities, if, at the time of such deposit, the Trustee or such
paying agent, as the case may be, did not have the written notice
provided for in Section 13.5 of any event prohibiting the making
of such deposit, or if, at the time of such deposit (whether or
not in trust) by the Issuer with the Trustee or paying agent
(other than the Issuer) such payment would not have been
prohibited by the provisions of this Article Thirteen, and the
Trustee or any paying agent shall not be affected by any notice
to the contrary received by it on or after such date.
SECTION 13.4 Disputes with Holders of Certain
Senior Indebtedness. Any failure by the Issuer to make any
payment on or under any Senior Indebtedness, other than any
Senior Indebtedness as to which the provisions of this Section
13.4 shall have been waived by the Issuer in the instrument or
instruments by which the Issuer incurred, assumed, guaranteed or
otherwise created such Senior Indebtedness, shall not be deemed a
default under Section 13.1 hereof if (i) the Issuer shall be
disputing its obligation to make such payment or perform such
obligation, and (ii) either (A) no final judgment relating to
such dispute shall have been issued against the Issuer which is
in full force and effect and is not subject to further review,
including a judgment that has become final by reason of the
expiration of the time within which a party may seek further
appeal or review, or (B) if a judgment that is subject to further
review or appeal has been issued, the Issuer shall in good faith
be prosecuting an appeal or other proceeding for review, and a
stay of execution shall have been obtained pending such appeal or
review.
SECTION 13.5 Trustee Not Charged with Knowledge of
Prohibition. Anything in this Article Thirteen or elsewhere in
this Indenture contained to the contrary notwithstanding, the
Trustee shall not at any time be charged with knowledge of the
existence of any facts which would prohibit the making of any
payment of moneys to or by the Trustee and shall be entitled to
assume conclusively that no such facts exist and that no event
specified in clauses (b) and (c) of Section 13.1 has happened
unless and until the Trustee shall have received an Officers'
Certificate to the effect or notice in writing to that effect
signed by or on behalf of the holder or holders, or the
representatives, of Senior Indebtedness who shall have been
certified by the Issuer or otherwise established to the
reasonable satisfaction of the Trustee to be such holder or
holders or representatives or from any trustee under any
indenture pursuant to which such Senior Indebtedness shall be
outstanding; provided, however, that, if the Trustee shall not
have received the Officers' Certificate or notice provided for in
this Section 13.5 at least three Business Days preceding the date
upon which by the terms hereof any moneys become payable for any
purpose (including, without limitation, the payment of either the
principal of or interest, if any, on any Security), then,
anything herein contained to the contrary notwithstanding, the
Trustee shall have full power and authority to receive such
moneys and apply the same to the purpose for which they were
received and shall not be affected by any notice to the contrary
that may be received by it within three Business Days preceding
such date. The Issuer shall give prompt written notice to the
Trustee and to each paying agent of any facts that would prohibit
any payment of moneys to or by the Trustee or any paying agent,
and the Trustee shall not be charged with knowledge of the curing
of any default or the elimination of any other fact or condition
preventing such payment or distribution unless and until the
Trustee shall have received an Officers' Certificate to such
effect.
SECTION 13.6 Trustee to Effectuate Subordination.
Each Holder of Securities by his acceptance thereof authorizes
and directs the Trustee on his behalf to take such action as may
be necessary or appropriate to effectuate the subordination as
between such Holder and holders of Senior Indebtedness as
provided in this Article Thirteen and appoints the Trustee its
attorney-in-fact for any and all such purposes.
SECTION 13.7 Rights of Trustee as Holder of Senior
Indebtedness. The Trustee shall be entitled to all the rights
set forth in this Article Thirteen with respect to any Senior
Indebtedness which may at the time be 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. Nothing in this Article Thirteen shall apply to
claims of, or payments to, the Trustee under or pursuant to
Section 6.6.
SECTION 13.8 Article Applicable to Paying Agents.
In case at any time any paying agent other than the Trustee shall
have been appointed by the Issuer and be then acting hereunder,
the term "Trustee" as used in this Article Thirteen shall in such
case (unless the context shall otherwise require) be construed as
extending to and including such paying agent within its meaning
as fully for all intents and purposes as if the paying agent were
named in this Article Thirteen in addition to or in place of the
Trustee; provided, however, that Sections 13.5 and 13.7 shall not
apply to the Issuer if it acts as paying agent.
SECTION 13.9 Subordination Rights Not Impaired by
Acts or Omissions of the Issuer or Holders of Senior
Indebtedness. No right of any present or future holders of any
Senior Indebtedness to enforce subordination as herein provided
shall at any time in any way be prejudiced or impaired by any act
or failure to act on the part of the Issuer or by any act or
failure to act, in good faith, by any such holder, or by any
noncompliance by the Issuer with the terms, provisions and
covenants of this Indenture, regardless of any knowledge thereof
which any such holder may have or be otherwise charged with. The
holders of Senior Indebtedness, may at any time or from time to
time and in their absolute direction, change the manner, place or
terms of payment, change or extend the time of payment of, or
renew or alter, any such Senior Indebtedness, or amend or
supplement any instrument pursuant to which any such Senior
Indebtedness is issued or by which it may be secured, or release
any security therefor, or exercise or refrain from exercising any
other of their rights under such Senior Indebtedness, including,
without limitation, the waiver of default thereunder, all without
notice to or assent from the Holders of the Securities or the
Trustee and without affecting the obligations of the Issuer, the
Trustee or the Holders of Securities under this Article Thirteen.
SECTION 13.10 Trustee Not Fiduciary for Holders of
Senior Indebtedness. The Trustee shall not be deemed to owe any
fiduciary duty to the holders of the Senior Indebtedness, and
shall not be liable to any such holders if it shall mistakenly
pay over or distribute money or assets to Securityholders or the
Issuer. With respect to the holders of Senior Indebtedness, the
Trustee undertakes to perform or to observe only such of its
covenants or obligations as are specifically set forth in this
Article Thirteen and no implied covenants or obligations with
respect to holders of Senior Indebtedness shall be read into this
Indenture against the Trustee.
IN WITNESS WHEREOF, the parties hereto have caused
this Indenture to be duly executed, effective as of December 15,
1993.
TRITON ENERGY CORPORATION
By: \\Peter Rugg
Title: Senior Vice President
Attest:
By: \\Robert B. Holland, III
Title: Senior Vice President
UNITED STATES TRUST COMPANY OF
NEW YORK,
as Trustee
By: ________________________
Title: _____________________
Attest:
By: ________________________
Title: _____________________
FIRST SUPPLEMENTAL INDENTURE
FIRST SUPPLEMENTAL INDENTURE, dated as of December 15,
1993 (this "Supplemental Indenture"), between TRITON ENERGY
CORPORATION, a Texas corporation as issuer (the "Issuer") and
UNITED STATES TRUST COMPANY OF NEW YORK, a New York corporation
as trustee (the "Trustee").
W I T N E S S E T H:
WHEREAS, the Issuer and the Trustee are parties to the
Indenture dated as of December 15, 1993 (as amended, supplemented
or otherwise modified from time to time, the "Indenture");
WHEREAS, the Board of Directors of the Issuer has
adopted a Board Resolution authorizing the Issuer (i) to issue
$170,000,000 in aggregate principal amount of its 9-3/4% Senior
Subordinated Discount Notes due 2000 in the form attached hereto
as Exhibit A (the "Notes"), which Notes shall constitute a series
of Securities under the Indenture and (ii) in connection with
issuance of the Notes and in accordance with the terms of Section
8.1 of the Indenture, to enter into this Supplemental Indenture
without the consent of the Holders of Securities; and
WHEREAS, the Issuer has requested the Trustee and the
Trustee has agreed to join in the execution of this Supplemental
Indenture in accordance with the terms of Section 8.1 of the
Indenture and subject to the conditions set forth herein;
NOW, THEREFORE, in consideration of the promises and
mutual agreements herein contained, the Issuer and the Trustee
mutually covenant and agree for the equal and proportionate
benefit of the Holders from time to time of the Notes as follows:
SECTION 1. Amendments to the Indenture Relating to
the Notes.
1.1 Amendments to Article One of the Indenture
(Definitions). Article One of the Indenture is hereby amended in
respect of the Notes and only in respect of the Notes as follows:
(a) by adding thereto the following new definitions in
their appropriate alphabetical order:
"Accreted Amount" as of any date of determination prior
to December 15, 1996 means the sum of (a) the initial
offering price of the Notes and (b) the portion of the
original issue discount per Note which shall have been
amortized with respect to such Note through such date, such
original issue discount to be so amortized at the rate of 9-
3/4% per annum (such percentage being expressed as a
percentage of the sum of the initial offering price plus
previously amortized original issue discount) using semi-
annual compounding of such rate on each December 15 and
June 15, commencing June 15, 1994, from the date of issuance
of the Notes through the date of determination. For any
date on or after December 15, 1996, Accreted Amount shall
mean 100% of the principal amount of the Notes.
"Acquired Indebtedness" means Indebtedness of a Person
(i) existing at the time such Person becomes a Subsidiary or
(ii) assumed in connection with the acquisition of assets
from a Person, other than Indebtedness incurred in
connection with, or in contemplation of, such Person
becoming a Subsidiary or such acquisition, as the case may
be.
"Asset Sale" means any conveyance, transfer, lease or
other disposition (including, without limitation, by way of
merger or consolidation), directly or indirectly, in any
consecutive 12-month period, in one or a series of related
transactions, of (i) any of the Capital Stock of any
Subsidiary or Special Subsidiary (other than the primary
issuance and sale by a Subsidiary or Special Subsidiary of
the Capital Stock of such Subsidiary or Special Subsidiary
and other than the sale and issuance of directors'
qualifying shares), (ii) all or substantially all of the
properties and assets of any division or line of business of
the Issuer or any of its "significant subsidiaries" (as
defined in Regulation S-X promulgated by the Commission
under the Exchange Act) or (iii) any other assets of the
Issuer or any of its Subsidiaries or Special Subsidiaries
outside of the ordinary course of business; provided,
however, that with respect to a Special Subsidiary, clause
(iii) above shall only apply to the extent the Issuer
actually receives by dividend any of the net proceeds
directly attributable thereto. For the purpose of this
definition, the term "Asset Sale" shall not include any
conveyance, transfer, lease or disposition of properties or
assets of the Issuer (A) the gross proceeds of which do not
exceed $1,000,000, (B) that is permitted pursuant to Section
9.1 of the Indenture or (C) that involves any transfer of
Capital Stock, property or assets of a Subsidiary or Special
Subsidiary to the Issuer or any other Subsidiary or of the
Issuer to a Restricted Subsidiary.
"Asset Sale Amount" shall have the meaning set forth in
Section 3.9(c).
"Asset Sale Offer" shall have the meaning set forth in
Section 3.9(c).
"Asset Sale Offer Date" shall have the meaning set
forth in Section 3.9(c).
"Asset Sale Offer Notice" shall have the meaning set
forth in Section 3.9(e).
"Asset Sale Offer Price" shall have the meaning set
forth in Section 3.9(c).
"Asset Sale Purchase Date" shall have the meaning set
forth in Section 3.9(d).
"Asset Sale Purchase Notice" shall have the meaning set
forth in Section 3.9(f).
"Average Quoted Price" means, with respect to any
security, the average of the Quoted Prices of such security
for 30 consecutive trading days ending on the last full
trading day prior to the time of determination set by the
Issuer, which shall be any date no later than 10 days prior
to the proposed incurrence of Indebtedness.
"Capital Stock" means, as applied to any Person, any
and all shares, interests, participations, rights or other
equivalents (however designated) of such Person's capital
stock whether now outstanding or issued after the date of
the Indenture except for Redeemable Stock.
"Capitalized Lease Obligation" means, as applied to any
Person, any obligation relating to any property (whether
real, personal or mixed) by that Person as lessee which, in
conformity with GAAP, is required to be accounted for as a
capital lease on the balance sheet of that Person.
"Cash Equivalents" means money, checks, demand deposit
accounts, certificates of deposit or acceptances with a
maturity of 180 days or less of any financial institution
that is a member of the Federal Reserve System having
combined capital and surplus and undivided profits of not
less than $300,000,000, commercial paper with a maturity of
180 days or less issued by a corporation (except an
Affiliate of the Issuer) organized under the laws of any
state of the United States of America or the District of
Columbia and rated at least A-1 by Standard & Poor's
Corporation and at least P-1 by Moody's Investors Service,
Inc. and other instruments or investments of equivalent
liquidity and safety.
"Change in Control" of the Issuer means the occurrence
of any of the following: (i) any Person other than the
Issuer, any Subsidiary of the Issuer, any Special Subsidiary
or any employee benefit plan of either the Issuer or any
Subsidiary of the Issuer or any Special Subsidiary, files a
Schedule 13D or 14D-1 under the Exchange Act (or any
successor schedule, form or report) disclosing that such
Person has become the beneficial owner of 40% or more of the
total combined voting power of the common stock and other
voting Capital Stock of the Issuer entitled to vote
immediately in the election of directors, (ii) there shall
be consummated any consolidation or merger of the Issuer (a)
in which the Issuer is not the continuing or surviving
corporation or (b) pursuant to which the common stock of the
Issuer would be converted into cash, securities or other
property, in each case other than a consolidation or merger
of the Issuer in which the holders of the Issuer's common
stock immediately prior to the consolidation or merger have,
directly or indirectly, at least a majority of the common
equity of the continuing or surviving corporation
immediately after the consolidation or merger or (iii) all
or substantially all the Issuer's assets are sold to any
Person.
"Change in Control Notice" shall have the meaning set
forth in Section 3.14(c).
"Change in Control Offer" shall have the meaning set
forth in Section 3.14(c).
"Change in Control Purchase Date" shall have the
meaning set forth in Section 3.14(a).
"Change in Control Purchase Notice" shall have the
meaning set forth in Section 3.14(c).
"Change in Control Purchase Price" shall have the
meaning set forth in Section 3.14(a).
"Colombian Assets" means (i) the Capital Stock of
Triton Colombia, (ii) the Capital Stock of any Subsidiary of
Triton Colombia, (iii) the shares, interests,
participations, rights or other equivalent means of
ownership owned by the Issuer or a Subsidiary of the Issuer
in any Joint Venture, provided such Joint Venture owns,
directly or indirectly, oil and gas properties or other
property interests or rights to oil and gas production in
the Santiago de las Atalayas and the Tauramena contract
areas in Colombia, (iv) the Capital Stock of any Subsidiary
of the Issuer (other than Triton Colombia and its
Subsidiaries) that owns, directly or indirectly, oil and gas
properties or other property interests or rights to oil and
gas properties in the Santiago de las Atalayas and the
Tauramena contract areas in Colombia and (v) assets,
tangible and intangible, of the Issuer or any Subsidiary or
Joint Venture referred to in clauses (i) through (iv) of
this definition that are located in or pertain directly to
the operations of the Issuer or any of its Subsidiaries in
the Santiago de las Atalayas and the Tauramena contract
areas in Colombia.
"Colombian Sale Redemption Price" means (i) with
respect to any repurchase date prior to December 15, 1996, a
price equal to 100% of Accreted Amount of the Notes to be so
redeemed plus the Make-Whole Premium, (ii) with respect to
any repurchase date on or after December 15, 1996 and before
December 15, 1997, a price equal to 100% of the principal
amount of the Notes to be so redeemed plus accrued and
unpaid interest to the repurchase date plus the Make-Whole
Premium, and (iii) with respect to any repurchase date on or
after December 15, 1997, at the Redemption Price then
applicable with respect to an optional redemption pursuant
to the terms of the Indenture plus accrued and unpaid
interest to the repurchase date.
"Consolidated Net Income" of the Issuer means, for any
period taken as one accounting period, the net income (or
loss) of the Issuer on a consolidated basis for such period
determined in conformity with GAAP.
"Consolidated Net Worth" means, with respect to any
Person, as at any date of determination, the consolidated
stockholders' equity (or like balance sheet designation) of
such Person as determined in accordance with GAAP.
"Currency Agreement" means any foreign exchange
contract, currency swap agreement or other similar agreement
or arrangement designed to protect the Issuer or any of its
Subsidiaries or the Special Subsidiaries against
fluctuations in currency values.
"Default" means any event which is, or after notice or
passage of time or both would be, an Event of Default.
"Deficiency" shall have the meaning set forth in
Section 3.9(c).
"Excess Proceeds" shall have the meaning set forth in
Section 3.9(b).
"GAAP" means generally accepted accounting principles
set forth in the opinions and pronouncements of the
Accounting Principles Board of the American Institute of
Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board
or in such other statements by such other entity as approved
by a significant segment of the accounting profession, which
are applicable to the circumstances as of the date of the
Indenture.
"guarantee" means, as applied to any obligation, (i) a
guaranty (other than by endorsement of negotiable
instruments for collection in the ordinary course of
business), direct or indirect, in any manner, of any part or
all of such obligation and (ii) an agreement, direct or
indirect, contingent or otherwise, the practical effect of
which is to assure in any way the payment or performance (or
payment of damages in the event of non-performance) of any
part or all of such obligation, including, without limiting
the foregoing, the payment of amounts drawn down by letters
of credit.
"Interest Rate Agreements" means the obligations of any
Person pursuant to any interest rate swap agreement,
interest rate collar agreement or other similar agreement or
arrangement designed to protect such Person or any of its
Subsidiaries against fluctuations in interest rates.
"Investment" means any direct or indirect advance, loan
(other than advances to customers in the ordinary course of
business, which are recorded as accounts receivable on the
balance sheet of any Person) or other extension of credit or
capital contribution to (by means of any transfer of cash or
other property to others or any payment for property or
services for the account or use of others), or any purchase
or acquisition of Capital Stock, bonds, notes, debentures or
other securities issued by, any other Person.
"Intercompany Agreement" means an intercompany
agreement substantially in the form attached as an Exhibit B
to the First Supplemental Indenture, dated as of December
15, 1993, between the Issuer and the Trustee.
"Joint Venture" means a joint venture, partnership or
other similar arrangement, whether in corporate, partnership
or other legal form, provided that, as to any such
arrangement in corporate form, such corporation shall not,
as to any Person of which such corporation is a Subsidiary,
be considered to be a Joint Venture to which such Person is
a party.
"Lien" means any mortgage, lien, security interest,
charge or encumbrance of any kind (including any conditional
sale or other title retention agreement, any lease in the
nature thereof, and any agreement to give any security
interest).
"Make-Whole Premium" means, (I) at any time prior to
December 15, 1996, the greater of (i) 1.0% of the Accreted
Amount of such Note at such time and (ii) the excess of (A)
the present value at such time of the Redemption Price of
such Note as of any optional Redemption Date designated by
the Issuer and all cash interest which would be payable or
would accrue thereon through such Redemption Date, computed
using a discount rate equal to the Treasury Yield plus 100
basis points, over (B) the Accreted Amount of such Note at
such time or (II) at any time on or after December 15, 1996,
the greater of (i) 1.0% of the principal amount of such Note
plus accrued and unpaid interest to such date and (ii) the
excess of (A) the present value at such time of the
Redemption Price of such Note, computed as provided in
clause (I)(ii)(A) above, over (B) the principal amount of
such Note and accrued and unpaid interest thereon at such
time.
"Material Subsidiary" means, at the time of
determination, any Subsidiary or Special Subsidiary of the
Issuer that (a) accounted for more than five percent of the
consolidated revenues of the Issuer for the most recently
completed fiscal year of the Issuer or (b) was the owner of
more than five percent of the consolidated assets of the
Issuer as at the end of such fiscal year, all as shown on
the consolidated financial statements of the Issuer for such
fiscal year.
"Net Cash Proceeds" means, with respect to any Asset
Sale, the proceeds thereof in the form of cash or Cash
Equivalents including payments in respect of deferred
payment obligations when received in the form of cash or
Cash Equivalents (except to the extent that such obligations
are financed or sold with recourse to the Issuer or any
Subsidiary) net of (i) brokerage commissions and other
reasonable fees and expenses (including fees and expenses of
counsel and investment bankers) related to such Asset Sale,
(ii) provisions for all taxes payable as a result of such
Asset Sale, (iii) payments made to retire Indebtedness where
payment of such Indebtedness is required in connection with
such Asset Sale and (iv) appropriate amounts to be provided
by the Issuer or any Subsidiary, as the case may be, as a
reserve, in accordance with GAAP, against any liabilities
associated with such Asset Sale and retained by the Issuer
or any Subsidiary, as the case may be, after such Asset
Sale, including, without limitation, pension and other post-
employment benefit liabilities, liabilities related to
environmental matters and liabilities under any
indemnification obligations associated with such Asset Sale.
"Notes" means the Issuer's 9-3/4% Senior Subordinated
Discount Notes due 2000 in the aggregate principal amount of
$170 million.
"1997 Notes" means the Issuer's 12 1/2% Senior
Subordinated Discount Notes due 1997 in the aggregate
principal amount of $240 million.
"Oil and Gas Reserve Estimate" means, on an after-tax
basis, the standardized measure of discounted future net
cash inflows relating to proved oil and gas reserves as
calculated in accordance with Statement of Financial
Accounting Standards No. 69, as in effect on the date of
this Indenture, as adjusted for any (i) back-in interests or
interest equalization and unitization arrangements with
third parties and (ii) acquisitions, transfers or
dispositions of interests in such reserves since the date as
of which such standardized measure has been calculated (it
being understood that in the case of any acquisition, the
right to include such estimates shall be dependent upon the
availability of such estimate from a nationally recognized
engineering firm).
"Permitted Indebtedness" means (i) the Notes; (ii) the
1997 Notes; (iii) Indebtedness of the Issuer or any of its
Subsidiaries or Special Subsidiaries outstanding on the date
of the Indenture; (iv) obligations pursuant to Interest Rate
Agreements or Currency Agreements; (v) with respect to any
assets acquired or constructed after the date of this
Indenture (including unimproved real property acquired prior
to the date of this Indenture), Indebtedness under
Capitalized Lease Obligations and purchase money mortgages;
(vi) Indebtedness of the Issuer or any Subsidiary in respect
of trade letters of credit and standby letters of credit
incurred in the ordinary course of business in an aggregate
amount not to exceed $25,000,000 at any time outstanding;
(vii) loans or advances from a Subsidiary to the Issuer or
another Subsidiary, provided that the obligation of the
obliger of such Indebtedness is subject to an Intercompany
Agreement; (viii) Indebtedness of the Issuer or any
Subsidiary consisting of (A) guaranties, indemnities or
obligations in respect of purchase price adjustments in
connection with the acquisition or disposition of assets and
(B) guarantees of the Indebtedness of a Restricted
Subsidiary, provided, however, that (I) to the extent such
transaction involves an Affiliate, the obligation of the
guarantor of such guarantee is subject to an agreement
substantially in the form of the Intercompany Agreement,
(II) such guarantee is subordinated to the Notes, and the
agreement governing the guarantee shall include
subordination provisions substantially similar to those set
forth in the Indenture subordinating such guarantee to the
Notes to the same extent as if the Notes were Senior
Indebtedness, and (III) such incurrence of the guarantee is
otherwise permitted under the provisions of Section 3.7 of
the Indenture; (ix) any obligation or liability of the
Issuer or any Subsidiary in respect of leasehold interests
assigned by the Issuer or such Subsidiary to any other
Person; (x) Indebtedness of the Issuer to any Restricted
Subsidiary, provided, however, that (I) the obligation of
the obligor of such Indebtedness is subject to an
Intercompany Agreement, (II) such Indebtedness is
subordinated to the Notes, and the agreement governing such
Indebtedness shall include subordination provisions
substantially similar to those set forth in the Indenture
subordinating such Indebtedness to the Notes to the same
extent as if the Notes were Senior Indebtedness, and (III)
such incurrence of Indebtedness is otherwise permitted under
the provisions of Section 3.7 of the Indenture; (xi) any
renewals, extensions, substitutions, refinancings or
replacements of any Indebtedness, including any successive
extensions, renewals, substitutions, refinancings or
replacements so long as the aggregate amount of Indebtedness
represented thereby is not increased by such renewal,
extension, substitution, refinancing or replacement unless
otherwise permitted in the Indenture, such renewal,
extension, substitution, refinancing or replacement does not
reduce the average life to stated maturity or the stated
maturity of such Indebtedness and, if the Indebtedness being
renewed, extended, substituted, refinanced or replaced is
Indebtedness of the Issuer, such renewal, extension,
substitution, refinancing or replacement shall be
Indebtedness of the Issuer; and (xii) additional
Indebtedness (including Acquired Indebtedness) having a
principal amount outstanding at issuance or at the date of
assumption not to exceed $100 million, at any time
outstanding.
"Permitted Investments" means (i) transactions
reflected as debits and credits on the books and records of
the Issuer and entered into in the ordinary course of
business, consistent with past practices, in connection with
the Issuer's cash management system and ongoing cost and
reimbursement arrangements among the Issuer and its
Restricted Subsidiaries, all in accordance with GAAP, (ii)
Investments in Restricted Subsidiaries, and (iii)
Investments in an aggregate amount not exceeding $20 million
outstanding at any time.
"Preferred Stock" means, with respect to any Person,
any and all shares, interests, participations or other
equivalents (however designated) or such Person's preferred
or preference stock whether now outstanding or issued after
the date of the Indenture, which is preferred as to the
payment of dividends or as to the distribution of assets
upon any voluntary or involuntary liquidation of such
Person, and includes, without limitation, all classes and
series of preferred or preference stock.
"Quoted Price" with respect to any security means the
last reported sales price (or, if no sales prices are
reported, the average of the high and low bid prices on the
last preceding trading day) of such security on the New York
Stock Exchange Composite Tape or such other international,
national or regional stock exchange upon which such security
is listed, or, if such security is not listed on an
international, national or regional stock exchange, as
quoted on the National Association of Securities Dealers
Automated Quotation System or the National Quotation Bureau
Incorporated or similar quotation system. In the absence of
one or more such quotations, the Board of Directors shall be
entitled to determine the Quoted Price on the basis of such
quotations or other information as it considers appropriate.
"Redeemable Stock" means any equity security that by
its terms or otherwise is required to be redeemed prior to
the Stated Maturity of the Notes, or is redeemable at the
option of the holder thereof at any time prior to the Stated
Maturity of the Notes.
"Redemption Date" when used with respect to any Note to
be redeemed, means the date fixed for such redemption by or
pursuant to the Indenture.
"Redemption Price" when used with respect to any Note
to be redeemed, means the price at which it is to be
redeemed pursuant to the Indenture.
"Restricted Payment" shall have the meaning set forth
in Section 3.7.
"Special Subsidiaries" means Triton Europe p.l.c.,
Crusader Limited, New Zealand Petroleum Company Limited and
Aero Services International, Inc.
"Stated Maturity" when used with respect to any Note,
means the date specified in such Note as the fixed date on
which the principal of such Note is due and payable.
"Treasury Yield" means the yield to maturity at the
time of computation of United States Treasury securities
with a constant maturity (as compiled by and published in
the most recent Federal Reserve Statistical Release H.15
(519) which has become publicly available at least two
Business Days prior to the applicable repurchase date (or,
if such Statistical Release is no longer published, any
publicly available source of similar market data)) most
nearly equal to the then remaining term of the Notes to the
optional Redemption Date designated for purposes of the
calculation of the Make-Whole Premium, provided that if such
remaining term is not equal to the constant maturity of a
United States Treasury security for which a weekly average
yield is given, the Treasury Yield shall be obtained by
linear interpolation (calculated to the nearest one-twelfth
of a year) from the weekly average yields of United States
Treasury securities for which such yields are given, except
that if such remaining term is less than one year, the
weekly average yield on actually traded United States
Treasury securities adjusted to a constant maturity of one
year shall be used.
"Triton Colombia" means Triton Colombia, Inc., one of
the Issuer's Wholly-owned Subsidiaries.
"Voting Stock" means the Capital Stock of any class or
kind ordinarily (without regard to the occurrence of any
contingency) having the power to vote for the election of
directors of the Issuer.
"Wholly-owned Subsidiary" means, with respect to any
Person, any Subsidiary of such Person, all of the
outstanding shares of Capital Stock having the right to
participate in the residual equity of such Subsidiary (other
than qualifying shares required to be owned by directors) of
which are owned directly by such Person or a wholly-owned
Subsidiary of such Person.
(b) by deleting therefrom the definitions of the
following defined terms in their respective entireties and
substituting in lieu thereof the following new definitions:
"Affiliate" means, as applied to any Person, any other
Person directly or indirectly controlling, controlled by, or
under common control with, that Person, or any other Person
that owns, directly or indirectly, 5% or more of such
Person's Capital Stock. For the purposes of this
definition, "control" (including, with correlative meanings,
the terms "controlling", "controlled by" and "under common
control with"), as applied to any Person, means the
possession, directly or indirectly, of the power to direct
or cause the direction of the management and policies of
that Person, whether through the ownership of voting
securities, by contract or otherwise.
"Indebtedness" of any Person means, without
duplication, with respect to any Person, any indebtedness,
whether or not contingent, in respect of borrowed money or
evidenced by bonds, notes, debentures or similar instruments
or letters of credit (or reimbursement agreements with
respect thereto) or representing the balance deferred and
unpaid of the purchase price of any property (including
pursuant to Capitalized Lease Obligations and any
conditional sale or other title retention agreement), except
any such balance that constitutes an accrued expense or
trade payable, if and to the extent any of the foregoing
indebtedness would appear as a liability upon a balance
sheet of such Person prepared in accordance with GAAP (but
does not include contingent liabilities which appear only in
a footnote to a balance sheet), and Indebtedness shall also
include, to the extent not otherwise included, the guaranty
of items which would be included within this definition and
obligations in respect of Currency Agreements, the notional
amount with respect to Interest Rate Agreements and the
liquidation value of Preferred Stock (except that
Indebtedness shall not include Preferred Stock of the
Issuer).
"Restricted Subsidiary" means any Person of which at
least 90% of the total voting power of outstanding shares of
Capital Stock entitled (without regard to the occurrence of
any contingency which does or may suspend or dilute the
voting rights of such stock) to vote in the election of
directors, managers or trustees thereof is at such time
owned or controlled by the Issuer directly or through one or
more of the other Subsidiaries of the Issuer or a
combination thereof, provided, however, that Triton Colombia
shall be deemed a Restricted Subsidiary for all purposes of
this definition for as long as the Issuer shall retain the
beneficial ownership of any of its Capital Stock having the
right to vote on matters brought before shareholders
generally, and provided, further, that a Special Subsidiary
shall be deemed a Restricted Subsidiary at such time as it
becomes at least 90% owned in accordance with this
definition.
"Senior Indebtedness" shall mean (i) the principal of
and premium, if any, and interest on and all other monetary
obligations of every kind or nature due on or in connection
with any Indebtedness of the Issuer (other than as otherwise
provided in this definition), whether outstanding on the
date of the Indenture or thereafter created, incurred or
assumed, unless, in the case of any particular Indebtedness,
the instrument creating or evidencing the same or pursuant
to which the same is outstanding expressly provides that
such Indebtedness shall not be senior in right of payment to
the Notes, and (ii) Indebtedness outstanding or incurred
after the date of the Indenture under the Issuer's bank
agreements. Notwithstanding the foregoing, Senior
Indebtedness shall not include (a) the principal of and
premium, if any, and interest on and all other monetary
obligations of every kind or nature due on or in connection
with any Indebtedness of the Issuer to a Subsidiary or any
other Affiliate of the Issuer or any of such Affiliate's
subsidiaries, (b) Indebtedness that is subordinate or junior
in right of payment to any Indebtedness of the Issuer
(including the 1997 Notes, as to which the Notes shall rank
pari passu in right of payment), (c) Indebtedness that, when
incurred, was without recourse to the Issuer, (d) any
liability for federal, state, local or other taxes owed or
owing by the Issuer, (e) that portion of any Indebtedness
which at the time of issuance is issued in violation of the
Indenture, (f) Indebtedness that is represented by
Redeemable Stock, (g) amounts owing under leases (other than
any Capitalized Lease Obligations), or (h) all amounts owed
(except to banks and other financing institutions) for
goods, materials or services purchased in the ordinary
course of business or for compensation to employees.
"Subsidiary" means any Person of which at least 50% of
the total voting power of outstanding shares of Capital
Stock entitled (without regard to the occurrence of any
contingency which does or may suspend or dilute the voting
rights of such stock) to vote in the election of directors,
managers or trustees thereof is at such time owned or
controlled, by any Person directly or through one or more of
the other Subsidiaries of that Person or a combination
thereof, provided, however, that Triton Colombia shall be
deemed a Subsidiary of the Issuer for all purposes of this
definition and the Indenture for as long as the Issuer shall
retain the beneficial ownership of any of its Capital Stock
having the right to vote on matters brought before
shareholders generally, and provided, further, that for
purposes of this definition, the term Subsidiaries shall not
include any Special Subsidiary until such time as it becomes
a Restricted Subsidiary.
1.2 Amendments to Article Three of the Indenture
(Covenants of the Issuer). Article Three of the Indenture is
hereby amended in respect of the Notes and only in respect of the
Notes by adding thereto the following new Sections 3.6 through
3.16 in their appropriate numerical order:
"SECTION 3.6 Limitation on Indebtedness. The Issuer
will not, and will not permit any of its Subsidiaries to,
directly or indirectly, incur, create, assume, guarantee or
in any other manner become directly or indirectly liable or
responsible for the payment of, any Indebtedness (including
any Acquired Indebtedness), other than Permitted
Indebtedness, unless at the time of such event (a) (i) any
such Indebtedness (other than Senior Indebtedness) has no
sinking fund or amortization payment date or final maturity
date prior to the Stated Maturity of the Notes and (ii) in
the case of Indebtedness subordinated in right of payment to
the Notes, the instrument evidencing such Indebtedness shall
include subordination provisions substantially similar to
those set forth in Article Thirteen subordinating such
Indebtedness to the Notes to the same extent as if the Notes
were Senior Indebtedness with respect to such Indebtedness
and (b) after giving effect thereto and to any acquisition
being financed through the incurrence of such Indebtedness
(including Acquired Indebtedness) on a pro forma basis,
either (i) the ratio expressed as a percentage of (A) the
Indebtedness of the Issuer and its Restricted Subsidiaries
to (B) the sum of (1) the Oil and Gas Reserve Estimate with
respect to the Issuer and the Restricted Subsidiaries plus
(2) the value of the Issuer's direct or indirect percentage
ownership in publicly-held Subsidiaries (other than its
Restricted Subsidiaries) engaged in oil and gas exploration,
development, production or transportation and, without
duplication, the Special Subsidiaries, in each case based
upon the Average Quoted Price of the common stock of such
Subsidiaries or Special Subsidiaries, shall not be greater
than 40% or (ii) the ratio expressed as a percentage of (A)
the Indebtedness of the Issuer and its Restricted
Subsidiaries to (B) the sum of (1) the Indebtedness of the
Issuer and its Restricted Subsidiaries plus (2) the product
of the number of outstanding shares of the Issuer's common
stock as of the date of determination multiplied by the
Average Quoted Price of the Issuer's common stock, shall not
be greater than 25%. For purposes of this calculation, (i)
a Subsidiary shall be considered publicly-held if there is a
Quoted Price available for its Capital Stock and (ii) the
Oil and Gas Reserve Estimate shall include, in connection
with an acquisition, on a pro forma basis the Oil and Gas
Reserve Estimate, if any, of any acquired Person and shall
be determined as of the end of the fiscal year of the Issuer
and, if applicable, the acquired Person, most recently
concluded if then available, but if not then available, the
end of the previous fiscal year of the Issuer and, if
applicable, the acquired Person; provided, however, that the
Issuer may, at its option, make such calculation utilizing a
more recent Oil and Gas Reserve Estimate in lieu of the Oil
and Gas Reserve Estimate referred to in the preceding clause
if (a) such estimate is prepared, to the extent of at least
85% of the quantities of proven oil and gas reserves set
forth in such estimate (which shall be determined on the
basis that six thousand cubic feet of gas equal one barrel
of oil), by a nationally recognized independent petroleum
engineer, (b) such Oil and Gas Reserve Estimate is
determined on a basis consistent with the estimate prepared
at fiscal year end, except that the oil and gas prices and
currency prices utilized therein shall be as of the date of
such more recent estimate and (c) an officer authorized by
the Issuer delivers to the Trustee a certificate to the
effect that such estimate has been prepared in accordance
with the requirements of Section 3.6.
SECTION 3.7 Limitation on Restricted Payments. The
Issuer will not, and will not permit any Restricted
Subsidiary to, directly or indirectly:
(i) declare or pay any dividend on, or make any
distribution to holders of, any shares of the Issuer's
Capital Stock (other than (A) the payment of a dividend
within 60 days after the date of declaration thereof,
(B) dividends or distributions payable in shares of its
Capital Stock or in options, warrants or other rights
to purchase such Capital Stock and (C) dividends on
Preferred Stock, which Preferred Stock by its terms is
not mandatorily redeemable or redeemable at the option
of the holder thereof prior to the Stated Maturity of
the Notes, provided that the dividend rate on such
Preferred Stock on the date of its issuance shall not
exceed the yield to maturity on the Notes calculated on
the basis of the average Quoted Prices of the Notes for
the 20 consecutive trading days ending 5 days prior to
the issuance of such Preferred Stock, but excluding
dividends or distributions payable in Redeemable Stock
or in options, warrants or other rights to purchase
Redeemable Stock except for dividends on such
Redeemable Stock payable in shares of Redeemable
Stock),
(ii) purchase, redeem or otherwise acquire or
retire for value any Capital Stock of the Issuer or any
Affiliate thereof, or any options, warrants or other
rights to acquire such Capital Stock (other than
(A) redemption of Preferred Stock that is convertible
into common stock, provided that the average Quoted
Price of such common stock for the 30 consecutive
trading days ending on the last full trading day prior
to the date of the notice of such redemption equals or
exceeds 130% of the conversion price of such Preferred
Stock, (B) with respect to any Restricted Subsidiary,
purchases or redemptions pursuant to the Issuer's
Shareholders' Rights Plan or purchases or redemptions
in the ordinary course of business not to exceed
$10,000 a year, and (C) in connection with a
transaction whereby a Subsidiary or a Special
Subsidiary becomes a Restricted Subsidiary or a
Subsidiary or a Special Subsidiary is being merged with
or into the Issuer or a Restricted Subsidiary in
accordance with the terms of this Indenture),
(iii) make any principal payment on, or redeem,
repurchase, defease or otherwise acquire or retire for
value, prior to any date earlier than six months before
any scheduled principal payment, maturity, scheduled
repayment or scheduled sinking fund payment, any
Indebtedness which is subordinated in right of payment
to, the prior payment of the Notes, provided, however,
that such Indebtedness may be redeemed in connection
with any refinancing of such Indebtedness so long as
the new Indebtedness incurred in such refinancing is
pari passu with, or is subordinated in right of payment
to, the Indebtedness being refinanced and has an
average life equal to or greater than the Indebtedness
being refinanced,
(iv) declare or pay any dividend or distribution
on any Capital Stock of any Subsidiary to any Person
(other than the Issuer or a Restricted Subsidiary) or
purchase, redeem or otherwise acquire or retire for
value, any Capital Stock of any Subsidiary held by any
Person (other than the Issuer or any of its Restricted
Subsidiaries),
(v) incur, create or assume any guarantee of
Indebtedness of any Affiliate (other than guarantees of
Indebtedness of a Restricted Subsidiary by the Issuer,
guarantees of Indebtedness of the Issuer by any
Subsidiary or guarantees of Indebtedness of any
Subsidiary or Special Subsidiary of the Issuer by the
Issuer pursuant to a transaction whereby any such
Subsidiary or Special Subsidiary becomes a Restricted
Subsidiary, including, without limitation, (a) the
execution by the obligor of such obligation of an
Intercompany Agreement and (b) the inclusion of
provisions in the guarantee substantially similar to
those set forth in Article Thirteen which subordinate
such guarantee to the Notes to the same extent as if
the Notes were Senior Indebtedness with respect to such
guarantee, provided that such guarantee is not
otherwise prohibited by the terms of this Indenture),
or
(vi) make any Investment (other than as permitted
in the preceding clauses (ii) and (v) or a Permitted
Investment) in any Person, other than an Investment in
a Restricted Subsidiary or any Special Subsidiary which
becomes a Restricted Subsidiary in connection with such
Investment, provided that to the extent applicable (a)
the obligation of the obligor in any such Investment is
subject to an Intercompany Agreement and (b) the
inclusion of provisions in the agreement governing the
Investment substantially similar to those set forth in
Article Thirteen which subordinate the Investment to
the Notes to the same extent as if the Notes were
Senior Indebtedness
(such payments or other actions described in the foregoing
clauses (i) through (vi) are collectively referred to as
"Restricted Payments") unless at the time of and after
giving effect to the proposed Restricted Payment (the amount
of any such Restricted Payment, if other than cash, as
determined by the Board of Directors, whose determination
shall be evidenced by a Board Resolution) (I) no Default or
Event of Default exists or occurs as a result of such
Restricted Payment, (II) the Issuer could incur at least
$1.00 of additional Indebtedness (other than Permitted
Indebtedness) in accordance with the provisions set forth in
Section 3.6 (provided that in the case of Restricted
Payments permitted in the preceding clauses (ii), (v) and
(vi), the Issuer could incur at least $1.00 of additional
Indebtedness, including Permitted Indebtedness) and (III)
the aggregate amount expended for all Restricted Payments
(excluding any amount repaid, returned or discharged in
respect of any Restricted Payment) shall not exceed the sum
of:
(A) 50% of the aggregate cumulative Consolidated
Net Income of the Issuer (calculated to exclude net
income of Subsidiaries that are not Restricted
Subsidiaries and to exclude the after-tax effect of the
net income of any Subsidiary to the extent that such
Subsidiary is restricted or prohibited from declaring
dividends) on a cumulative basis during the period
beginning on the first day following the last fiscal
year that ended prior to the date of this Indenture and
ending on the last day of the Issuer's last fiscal
quarter ending prior to the date of such proposed
Restricted Payment (or, if such aggregate cumulative
Consolidated Net Income shall be a loss, minus 100% of
such loss) and 50% of the aggregate cumulative
dividends received by the Issuer from any Subsidiary or
Special Subsidiary (other than a Restricted Subsidiary)
during the same period, plus
(B) the aggregate net proceeds received
(including, without limitation, Indebtedness or
redemption or repurchase obligations discharged, repaid
or otherwise satisfied upon any conversion of
convertible Indebtedness or Redeemable Stock into
Capital Stock of the Issuer) after the date of this
Indenture as capital contributions from the issuance of
Capital Stock other than Redeemable Stock;
provided, however, the failure to satisfy the conditions set
forth in clauses (II) or (III) (but not (I)) above shall not
prevent the Issuer or any Restricted Subsidiary from (y)
making Restricted Payments not to exceed $5,000,000 in the
aggregate (excluding any amount repaid, returned or
discharged in respect of any Restricted Payment) which
amount shall be in addition to any amounts paid under clause
(III) above, or (z) making Restricted Payments necessary for
and directly related (as determined in good faith by the
Board of Directors and evidenced in a Board Resolution,
which determination shall be conclusive) to the development,
transportation or marketing of the oil and gas reserves of
the Issuer and its Restricted Subsidiaries located in the
Republic of Colombia, which amounts shall be in addition to
any amounts paid under clause (III) above, and that in each
case are not otherwise prohibited by the terms of this
Indenture.
SECTION 3.8 Limitation on Transactions with
Affiliates. The Issuer will not, and will not permit any of
its Subsidiaries to, directly or indirectly, enter into any
transaction or series of related transactions (including,
without limitation, the sale, purchase, exchange or lease of
assets, property or services) with any Affiliate (other than
a wholly-owned Subsidiary) of the Issuer or any Subsidiary
in an aggregate amount greater than $1,000,000 unless (i)
such transaction or series of related transactions is on
terms that are no less favorable to the Issuer or such
Subsidiary, as the case may be, than those that would have
been available in a comparable arm's-length transaction with
an unaffiliated third party and (ii) (A) with respect to any
transaction or series of related transactions involving
aggregate payments in excess of $1,000,000, but less than
$10,000,000, the Issuer delivers an Officer's Certificate to
the Trustee generally describing such transaction and
certifying that such transaction or transactions complies
with clause (i) above and (B) with respect to a transaction
or series of transactions involving aggregate payments equal
to or greater than $10,000,000, such transaction or
transactions shall have received the approval of a majority
of the disinterested directors of the Board of Directors (as
evidenced by a Board Resolution by such disinterested
directors, a certified copy of which has been delivered to
the Trustee).
SECTION 3.9 Disposition of Proceeds of Asset Sales.
(a) The Issuer will not, and will not permit any of its
Subsidiaries (excluding the Special Subsidiaries, Triton Air
Holdings, Inc. and their respective Subsidiaries) to, make
any Asset Sale unless (i) such Asset Sale is for not less
than the fair market value of the assets or shares sold (as
determined by the Board of Directors and evidenced in a
Board Resolution, which determination shall be conclusive),
(ii) at least 85% of the consideration (not including the
assumption of any Indebtedness by the purchaser in
connection with such Asset Sale) consists of cash and Cash
Equivalents and the fair market value (as determined in good
faith by the Board of Directors and evidenced in a Board
Resolution, which determination shall be conclusive) of debt
and equity securities listed on any recognized securities
exchange or traded in any recognized over-the-counter
market, except (x) in the case of an Asset Sale involving
oil and gas properties being sold to Persons other than
Subsidiaries by one or more Subsidiaries of the Issuer or
the Issuer, the consideration may consist solely or in part
of oil and gas properties having a fair market value at
least equal to the fair market value of the assets exchanged
(as determined by the Board of Directors and evidenced by a
Board Resolution, which determination shall be conclusive),
(y) in the case of an Asset Sale involving Aero Services
International, Inc., the consideration need not be for cash
and may consist in whole or in part of a promissory note not
to exceed $10,000,000, and (z) the Issuer may enter into
farm-out transactions consistent with industry standards and
otherwise in accordance with the terms of this Indenture,
including, but not limited to, Section 3.8, and (iii) as
otherwise set forth below.
(b) Within 12 months of any Asset Sale, the Issuer
shall either (i) apply or cause the application of the Net
Cash Proceeds of such Asset Sale, or a portion thereof, to
the permanent repayment or prepayment of Senior Indebtedness
or the 1997 Notes or (ii) invest, or enter into a legally
binding agreement to invest, such Net Cash Proceeds, or a
portion thereof, in properties and assets to replace the
properties and assets that were the subject of such Asset
Sale or in properties and assets that (as determined by the
Board of Directors and evidenced in a Board Resolution,
which determination shall be conclusive) will be used in the
business of the Issuer or its Subsidiaries, as the case may
be, existing on the date of this Indenture or in businesses
the principal purposes of which are related to the
exploration, development, production or transportation of
oil or gas, provided, however, that in the event the Issuer
or any Subsidiary conveys, transfers, leases or otherwise
disposes of, directly or indirectly, any of its Colombian
Assets in a transaction or series of related transactions
within any consecutive 12-month period the effect of which
is to reduce the Oil and Gas Reserve Estimate of the
Colombian Assets owned by the Issuer and/or its Subsidiaries
by 50% or more (which value shall be determined by reference
to the most recently available Oil and Gas Reserve Estimate,
or by any subsequent estimate prepared by a nationally
recognized petroleum engineering firm) or such transaction
reduces the Issuer's direct and indirect net revenue
interest in either the Santiago de las Atalayas or Tauramena
contract areas of the Llanos Basin to less than 50% of such
interest as of the date of this Indenture, calculated to
give effect to back-in interests of and equalization and
unitization arrangements with third parties, then the Issuer
or such Subsidiary shall apply the Net Cash Proceeds
resulting from such transaction and every transaction
thereafter with respect to the Colombian Assets to either
(A) permanently repay or prepay Senior Indebtedness or the
1997 Notes or (B) redeem the Notes at a price equal to the
Colombian Sale Redemption Price and otherwise in accordance
with the provisions of Article Twelve as if an optional
redemption were being made, in each case within 90 days of
such transaction. If any such legally binding agreement to
invest any Net Cash Proceeds referred to in clause (ii) of
the preceding sentence is terminated, then the Issuer may
invest such Net Cash Proceeds, prior to the end of such
12-month period or within 90 days from such termination,
whichever is later, in the business of the Issuer and its
Subsidiaries as provided in clauses (i) and (ii) above. The
amount of such Net Cash Proceeds not applied, used or
invested as set forth above constitutes "Excess Proceeds."
(c) When the aggregate amount of Excess Proceeds
equals $10,000,000 or more, the Issuer shall so notify the
Trustee in writing and shall offer to purchase from all
Holders of the Notes (an "Asset Sale Offer"), and shall
purchase from Holders accepting such Asset Sale Offer on the
date fixed for such Asset Sale Offer (the "Asset Sale Offer
Date"), the maximum amount (expressed in integral multiples
of aggregate principal amount of $1,000) of Notes that may
be purchased out of the Excess Proceeds, in accordance with
the procedures set forth in Section 3.9(e) (the "Asset Sale
Amount"), at an offer price (the "Asset Sale Offer Price")
in cash in an amount equal to 100% of the Accreted Amount
thereof on any Asset Sale Offer Date prior to December 15,
1996 or 100% of the principal amount thereof plus accrued
and unpaid interest, if any, to any Asset Sale Offer Date on
or after December 15, 1996, in accordance with the
procedures set forth in Section 3.9(e). To the extent that
the aggregate amount of Notes tendered pursuant to an Asset
Sale Offer is less than the Excess Proceeds relating thereto
(such shortfall constituting a "Deficiency"), then the
Issuer may use such Deficiency, or a portion thereof, for
general corporate purposes. Upon completion of an Asset
Sale Offer, the amount of Excess Proceeds shall be reset at
zero.
(d) If the Issuer becomes obligated to make an Asset
Sale Offer pursuant to Section 3.9(c), Notes shall be
purchased by the Issuer, at the option of the Holder
thereof, in whole or in part in integral multiples of
aggregate principal amount of $1,000, on a date that is not
earlier than 30 days nor later than 60 days from the date
the Asset Sale Offer Notice referred to in Section 3.9(e)
below is given to Holders, or such later date as may be
necessary for the Issuer to comply with requirements under
the Exchange Act (such date, or such later date, being the
"Asset Sale Purchase Date"), subject to proration in the
event the Asset Sale Amount is less than the aggregate Asset
Sale Offer Price of all Notes tendered and to satisfaction
by or on behalf of the Holder of the requirements set forth
in Section 3.9(f).
(e) Within 30 days after the date that the aggregate
amount of Excess Proceeds equals or exceeds $10,000,000, the
Issuer shall give written notice of the offer (an "Asset
Sale Offer Notice") to the Trustee and to each Holder of the
Notes, at their addresses appearing in the Note register, by
first-class mail postage prepaid. The Trustee shall be
under no obligation to ascertain whether the Issuer is
obligated to make an Asset Sale Offer. The Asset Sale Offer
Notice shall contain all instructions and materials
necessary to enable the Holders to tender Notes, shall
include a form of Asset Sale Purchase Notice (as defined in
Section 3.9(f)) to be completed by the Holder and shall
state or provide:
(i) that the Holder has the right to require the
Issuer to repurchase, subject to proration, such
Holder's Notes at the Asset Sale Offer Price and the
date by which a Holder must give an Asset Sale Purchase
Notice;
(ii) the Asset Sale Offer Price;
(iii) the Asset Sale Purchase Date;
(iv) that any Note not purchased will continue to
accrue original issue discount and interest, as
applicable;
(v) that Notes to be purchased shall, on the
Asset Sale Purchase Date, become due and payable at the
Asset Sale Offer Price and from and after such date
(unless the Issuer shall default in the payment of the
Asset Sale Offer Price) such Notes shall cease to
accrue original issue discount and interest, as
applicable;
(vi) that the Notes to be purchased are subject to
proration in the event the Asset Sale Amount is less
than the aggregate Asset Sale Offer Price of all Notes
tendered;
(vii) (A) the Issuer's most recently filed Annual
Report on Form 10-K (including audited consolidated
financial statements), the Issuer's most recent
subsequently filed Quarterly Report on Form 10-Q, as
applicable, and any Current Report on Form 8-K of the
Issuer filed subsequent to such Quarterly Report (or,
if the Issuer is not required to file any of the
foregoing forms, the comparable information required to
be prepared by the Issuer pursuant to Section 4.3), (B)
a description of any material developments in the
Issuer's business since its latest annual or quarterly
report filed with the Trustee pursuant to Section 4.3
and, if material, any appropriate pro forma financial
information (including, but not limited to, pro forma
historical income, cash flow and capitalization after
giving effect to such Asset Sale) and (C) such other
information, if any, concerning the business of the
Issuer which the Issuer in good faith believes will
enable such Holders to make an informed investment
decision; and
(viii) the procedures a Holder must follow to
exercise rights under Section 3.9(c) and a brief
description of those rights and the procedures for
withdrawing an Asset Sale Purchase Notice.
(f) A Holder may exercise its rights specified in
Section 3.9(c) upon (i) delivery to the Paying Agent
specified in the Asset Sale Offer Notice of a written notice
(an "Asset Sale Purchase Notice") at any time prior to the
close of business on the Asset Sale Purchase Date, but not
later than the close of business on the second Business Day
next preceding the Asset Sale Purchase Date, stating (A) the
certificate number of the Note that the Holder will tender
to be purchased and (B) the portion of the aggregate
principal amount of the Note that the Holder will tender to
be purchased, which portion must be $1,000 or an integral
multiple thereof, and (ii) delivery of such Note to such
Paying Agent at such office prior to or on or after the
Asset Sale Purchase Date (together with all necessary
endorsements), such delivery being a condition to receipt by
the Holder of the Asset Sale Offer Price therefor; provided
that Notes to be purchased are subject to proration in the
event the Asset Sale Amount is less than the aggregate Asset
Sale Offer Price of all Notes tendered for purchase. If a
Holder has elected to deliver to the Issuer for purchase a
portion of a Note, and if the aggregate principal amount of
such portion is $1,000 or an integral multiple thereof, the
Issuer shall, subject to proration, purchase such portion
from the Holder thereof pursuant to this Section 3.9.
Provisions of this Indenture that apply to the purchase of
all of a Note also apply to the purchase of a portion of
such Note. Each Paying Agent shall promptly notify the
Issuer of the receipt by the former of any and all Asset
Sale Purchase Notices and any and all written notices of
withdrawal thereof.
(g) Upon receipt by the Paying Agent specified in the
Asset Sale Offer Notice of an Asset Sale Purchase Notice,
the Holder of the Note in respect of which such Asset Sale
Purchase Notice was given shall (unless such Asset Sale
Purchase Notice is withdrawn pursuant to Section 3.9(k))
thereafter be entitled to receive solely the Asset Sale
Offer Price with respect to such Note. Such Asset Sale
Offer Price shall be paid to such Holder promptly following
the later of the Business Day following the Asset Sale
Purchase Date (provided the conditions in Section 3.9(f)
have been satisfied) and the time of delivery of such Note
to the relevant Paying Agent at the office of such Paying
Agent by the Holder thereof in the manner required by
Section 3.9(f).
(h) On or prior to 11:00 a.m., New York City time, on
the Asset Sale Purchase Date, the Issuer shall deposit with
the Paying Agent specified in the Asset Sale Offer Notice
(or if the Issuer is acting as its own Paying Agent,
segregate and hold in trust as provided in Section 6.5) an
amount of money in same day funds (or New York Clearing
House funds if such deposit is made prior to the Asset Sale
Purchase Date) sufficient to pay the aggregate Asset Sale
Offered Price of all the Notes or portions thereof which are
to be purchased on that date.
(i) Any Note that is to be purchased only in part
shall be surrendered to the Paying Agent specified in the
Asset Sale Offer Notice at the office of such Paying Agent
(with, if the Issuer or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form
satisfactory to the Issuer and the Trustee duly executed by,
the Holder thereof or such Holder's attorney duly authorized
in writing), and the Issuer shall execute and the Trustee
shall authenticate and deliver to the Holder of such Note,
without service charge, one or more new Notes of any
authorized denomination as requested by such Holder in an
aggregate principal amount equal to, and in exchange for,
the portion of the principal amount of the Note so
surrendered that is not purchased.
(j) The Issuer shall comply with any applicable tender
offer rules then in effect, including Section 14(e) of the
Exchange Act and Rule 14e-1 promulgated thereunder, in
connection with an Asset Sale Offer. In the event of any
conflict between such tender offer rules and the provisions
set forth in this Section 3.9, such tender offer rules shall
control.
(k) An Asset Sale Purchase Notice may be withdrawn
before or after delivery by the Holder to the relevant
Paying Agent at the office of such Paying Agent of the Note
to which such Asset Sale Purchase Notice relates, by means
of a written notice of withdrawal (by facsimile transmission
or letter) received by such Paying Agent at such office not
later than three Business Days prior to the Asset Sale
Purchase Date, specifying, as applicable:
(i) the certificate number of the Note in respect
of which such notice of withdrawal is being submitted;
(ii) the aggregate principal amount of the Notes
initially outstanding hereunder with respect to which
such notice of withdrawal is being submitted; and
(iii) the aggregate principal amount initially
outstanding hereunder of the Note that remains subject
to the original Asset Sale Purchase Notice and that has
been or will be delivered for purchase by the Issuer.
A written notice of withdrawal may be in the form set forth
in the preceding paragraph. Each Paying Agent will promptly
return to the prospective Holders thereof any Notes with
respect to which an Asset Sale Purchase Notice has been
withdrawn in compliance with this Indenture.
(l) The Issuer will not, and will not permit any
Subsidiary to, create or permit to exist or become effective
any restriction (other than restrictions existing under (i)
Indebtedness as in effect on the date of this Indenture or
(ii) any Senior Indebtedness existing on the date of this
Indenture or thereafter) that would materially impair the
ability of the Issuer to make an Asset Sale Offer to
purchase the Notes upon an Asset Sale or, if such Asset Sale
Offer is made, to pay for the Notes tendered for purchase.
SECTION 3.10 Limitation on Liens. The Issuer will
not, and will not permit any of its Subsidiaries to, create,
incur, assume or suffer to exist any Lien of any kind upon
any of their respective assets or properties now owned or
acquired after the date of this Indenture, or any income or
profits therefrom, securing any Indebtedness of the Issuer
that is expressly by its terms subordinate or junior in
right of payment to any other Indebtedness of the Issuer,
unless the Notes are equally and ratably secured, provided,
however, that if such Lien securing such junior or
subordinated Indebtedness ceases to exist, such equal and
ratable Lien for the benefit of the Holders of the Notes
shall cease to exist; provided, further, that the Lien
securing such subordinated or junior Indebtedness shall be
subordinated and junior to the Lien securing the Notes with
the same relative priority as such subordinated or junior
Indebtedness shall have with respect to the Notes.
For purposes of this Indenture, the Notes will be
considered equally and ratably secured with any other Lien
if the Lien securing the Notes is of at least equal priority
and covers the same property or assets as such other Lien.
SECTION 3.11 Limitation Upon Other Senior Subordinated
Indebtedness. The Issuer will not incur, create, assume,
guarantee or in any other manner become directly or
indirectly liable with respect to or be responsible for, or
permit to remain outstanding, any Indebtedness (other than
the Notes or the 1997 Notes) that is subordinate or junior
in right of payment to any Senior Indebtedness of the
Issuer, unless such Indebtedness is also pari passu with, or
subordinate in right of payment to, the Notes pursuant to
subordination provisions substantially similar to those set
forth in Article Thirteen.
SECTION 3.12 Limitation on Dividends and Other Payment
Restrictions Affecting Subsidiaries. The Issuer will not,
and will not permit any of its Subsidiaries to, create or
otherwise cause or suffer to exist or become effective any
consensual encumbrance or restriction on the ability of the
Issuer or any Subsidiary to (i) pay dividends or make any
other distributions on Capital Stock of any Subsidiary, (ii)
pay any Indebtedness owed to the Issuer or any Subsidiary,
(iii) make any Investment in the Issuer or any Subsidiary,
or (iv) transfer any of its property or assets to the Issuer
or any Subsidiary, except
(A) any encumbrance or restriction pursuant to an
agreement in effect at or entered into on the date of
this Indenture,
(B) any encumbrance or restriction with respect to
a Person that is not a Subsidiary of the Issuer on the
date of this Indenture, in existence at the time such
Person becomes a Subsidiary of the Issuer or created on
the date it becomes a Subsidiary and not incurred in
connection with, or in contemplation of, such Person
becoming a Subsidiary,
(C) any encumbrance or restriction on the ability
of any Subsidiary to transfer any of its real property
(and any improvements thereon) acquired after the date
of this Indenture, to the Issuer or any Subsidiary that
is required by a lender to, or purchaser of any
Indebtedness of, such Subsidiary in connection with a
financing of the acquisition of such property (and/or
construction of such improvements) by such Subsidiary
permitted under this Indenture,
(D) any encumbrance or restriction pursuant to any
agreement that extends, refinances, renews or replaces
any agreement containing any of the restrictions
described in the foregoing clauses (A) through (C),
provided, however, that the terms and conditions of any
such restrictions are not materially less favorable to
the Holders of the Notes than those under or pursuant
to the agreement evidencing the Indebtedness so
extended, refinanced, renewed or replaced,
(E) encumbrances or restrictions arising under
law,
(F) any encumbrance or restriction arising under
customary non-assignment provisions in installment
purchase contracts, and
(G) in the case of clause (iv) above, restrictions
contained in security agreements permitted by this
Indenture securing Indebtedness permitted by this
Indenture to the extent such restrictions restrict the
transfer of property subject to such security
agreements or any renewals, extensions, substitutions,
refinancings or replacements of such Indebtedness,
provided, however, that the terms and conditions of any
such restrictions shall not be materially less
favorable to the Holders of the Notes than those under
or pursuant to the agreement evidencing the
Indebtedness so renewed, extended, substituted
refinanced, or replaced.
SECTION 3.13 Limitation on Guaranties. (a) The
Issuer will not permit any Subsidiary, directly or
indirectly, to assume, guarantee or in any other manner
become liable with respect to the payment of any Senior
Indebtedness, unless (i) such Subsidiary simultaneously
executes and delivers a supplemental indenture to this
Indenture providing for the guarantee of the payment of the
Notes by such Subsidiary, which guarantee shall include
subordination provisions substantially similar to those set
forth in Article Thirteen to the same extent as the Notes
are subordinated to Senior Indebtedness; and (ii) such
Subsidiary waives and will not in any manner whatsoever
claim or take the benefit or advantage of, any rights of
reimbursement, indemnity or subrogation or any other rights
against the Issuer or any other Subsidiary as a result of
such payment by such Subsidiary under its guarantee.
Notwithstanding the foregoing, any such guarantee by a
Subsidiary of the Notes shall provide by its terms that it
shall be automatically and unconditionally released and
discharged upon the release or discharge of such guarantee
of payment of such Senior Indebtedness.
(b) The Issuer will not permit any Subsidiary,
directly or indirectly, to assume, guarantee or in any other
manner become liable with respect to the payment of any
Indebtedness which is pari passu with or subordinated to the
Notes, unless such Subsidiary simultaneously executes and
delivers a supplemental indenture to this Indenture
providing for a guarantee of the payment of the Notes by
such Subsidiary; provided, however, in the case of such
Subsidiary's assumption, guarantee or other liability with
respect to Indebtedness subordinated to the Notes, such
guarantee, assumption or other liability shall be
subordinated to such Subsidiary's guarantee of the Notes to
the same extent as such Indebtedness is subordinated to the
Notes; and provided, further, that this Section 3.13(b)
shall not be applicable to any guarantee, assumption or
other liability of any Subsidiary of the Issuer in existence
on the date of this Indenture or that (i) existed at the
time such Person became a Subsidiary of the Issuer and (ii)
was not incurred in connection with, or in contemplation of,
such Person becoming a Subsidiary of the Issuer.
Notwithstanding the foregoing, any such guarantee of the
Notes by a Subsidiary shall provide by its terms that it
shall be automatically and unconditionally released and
discharged upon the release or discharge of such guarantee
of such Indebtedness that is pari passu with or subordinated
to the Notes.
SECTION 3.14 Purchase of Notes Upon Change in Control.
(a) If there shall have occurred a Change in Control, Notes
shall be purchased by the Issuer, at the option of the
Holder thereof, in whole or in part in integral multiples of
aggregate principal amount of $1,000, on a date that is not
earlier than 45 days nor later than 60 days from the date
the Change in Control Notice referred to in paragraph (c)
below is given to Holders or such later date as may be
necessary for the Issuer to comply with requirements under
the Exchange Act (such date, or such later date, being the
"Change in Control Purchase Date"), at a purchase price in
cash (the "Change in Control Purchase Price") equal to 101%
of the Accreted Amount thereof on any Change in Control
Purchase Date prior to December 15, 1996 or 101% of the
principal amount thereof plus accrued and unpaid interest,
if any, to any Change in Control Purchase Date on or after
December 15, 1996, subject to satisfaction by or on behalf
of the Holder of the requirements set forth in Section
3.14(c).
(b) Within 30 days following a Change in Control and
prior to the mailing of the Change in Control Notice to
Holders provided for in paragraph (c) below, the Issuer
covenants to either (1) repay in full all Senior
Indebtedness the terms of which require such payment in
connection with such event or (2) obtain the requisite
consent from holders of such Senior Indebtedness not repaid
in order to permit the repurchase of the Notes as provided
for in this Section 3.14. The Issuer shall first comply
with this subsection (b) before it shall be required to
repurchase the Notes pursuant to this Section 3.14, and any
failure to comply with this subsection (b) shall constitute
a Default in the performance of a covenant for purposes of
Section 5.1(b).
(c) Within 30 days after the occurrence of a Change in
Control, the Issuer shall give written notice of such Change
in Control (a "Change in Control Notice") and of its offer
(the "Change in Control Offer") to purchase Notes as
specified herein to the Trustee and to each Holder of the
Notes at its address appearing on the Note register, by
first-class mail, postage prepaid. The Trustee shall be
under no obligation to ascertain whether the Issuer is
obligated to give a Change in Control Notice. The Change in
Control Notice shall contain all instructions and materials
necessary to enable such Holders to tender Notes, shall
include a form of written notice to be completed by Holders
electing to have Notes purchased under Section 3.14(a) (a
"Change in Control Purchase Notice") and shall state or
include:
(i) that a Change in Control has occurred and the
circumstances and events causing the Change in Control
and the date such Change in Control is deemed to have
occurred for purposes of this Section 3.14(c);
(ii) the date by which a Holder must give a Change
in Control Purchase Notice;
(iii) the Change in Control Purchase Price;
(iv) the Change in Control Purchase Date;
(v) that any Note not purchased will continue to
accrue original issue discount and interest, as
applicable;
(vi) that Notes to be purchased shall, on the
Change in Control Purchase Date, become due and payable
at the Change in Control Purchase Price and from and
after such date (unless the Issuer shall default in the
payment of the Change in Control Purchase Price) such
Notes shall cease to accrue original issue discount and
interest, as applicable;
(vii) (A) the Issuer's most recently filed Annual
Report on Form 10-K (including audited consolidated
financial statements), the Issuer's most recent
subsequently filed Quarterly Report on Form 10-Q, as
applicable, and any Current Report on Form 8-K of the
Issuer filed subsequent to such Quarterly Report (or,
if the Issuer is not required to file any of the
foregoing forms, the comparable information required to
be prepared by the Issuer pursuant to Section 4.3), (B)
a description of any material developments in the
Issuer's business since its latest annual or quarterly
report filed with the Trustee pursuant to Section 4.3
and, if material, any appropriate pro forma financial
information (including but not limited to pro forma
historical income, cash flow and capitalization after
giving effect to such Change in Control) and (C) such
other information, if any, concerning the business of
the Issuer which the Issuer in good faith believes will
enable such Holders to make an informed investment
decision; and
(viii) the procedures a holder must follow to
exercise rights under this Section 3.14(c) and a brief
description of those rights and the procedures for
withdrawing a Change in Control Purchase Notice.
(d) Holders electing to have Notes purchased under
Section 3.14(a) will be required to deliver a Change in
Control Purchase Notice and surrender such Notes to the
Paying Agent specified in the Change of Control Notice at
the address specified in the notice by the close of business
at least five Business Days prior to the Change in Control
Purchase Date. Holders will be entitled to withdraw their
election if such Paying Agent receives, at the close of
business not later than three Business Days prior to the
Change in Control Purchase Date, a telegram, telex,
facsimile transmission or letter setting forth (i) the name
of the Holder, (ii) the certificate number of the Note in
respect of which such notice of withdrawal is being
submitted, (iii) the aggregate principal amount of the
Notes delivered for purchase by the Holder as to which its
election is to be withdrawn, and (iv) a statement that such
Holder is withdrawing its election to have such Notes
purchased. Each Paying Agent will promptly return to the
prospective Holders thereof any Notes with respect to which
a Change in Control Purchase Notice has been withdrawn in
compliance herewith.
(e) Upon receipt by the Paying Agent specified in the
Change of Control Notice of a Change in Control Purchase
Notice, the Holder of the Note in respect of which such
Change in Control Purchase Notice was given shall (unless
such Change in Control Purchase Notice is withdrawn pursuant
to Section 3.14(d)) thereafter be entitled to receive solely
the Change in Control Purchase Price with respect to such
Note. Such Change in Control Purchase Price shall be paid
to such Holder promptly following the later of the Business
Day following the Change in Control Purchase Date (provided
the conditions in Section 3.14(d) have been satisfied) and
the time of delivery of such Note to the relevant Paying
Agent at the office of such Paying Agent by the Holder
thereof in the manner required by Section 3.14(c).
(f) On or prior to 11:00 a.m., New York City time, on
the Change in Control Purchase Date, the Issuer shall
deposit with the Paying Agent specified in the Change of
Control Notice (or if the Issuer is acting as its own Paying
Agent, segregate and hold in trust as provided in Section
6.5) an amount of money in same day funds (or New York
Clearing House funds if such deposit is made prior to the
Change in Control Purchase Date) sufficient to pay the
Change in Control Purchase Price of all the Notes or
portions thereof which are to be purchased on that date.
(g) Any Note that is to be purchased only in part
shall be surrendered to the Paying Agent specified in the
Change of Control Notice at the office of such Paying Agent
(with, if the Issuer or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form
satisfactory to the Issuer and the Trustee duly executed by,
the Holder thereof or such Holder's attorney duly authorized
in writing), and the Issuer shall execute and the Trustee
shall authenticate and deliver to the Holder of such Note,
without service charge, one or more new Notes of any
authorized denomination as requested by such Holder in the
aggregate principal amount of the Note so surrendered that
is not purchased.
(h) The Issuer shall comply with any applicable tender
offer rules then in effect, including Section 14(e) of the
Exchange Act and Rule 14e-1 promulgated thereunder, in
connection with a Change in Control Offer. In the event of
any conflict between such tender offer rules and the
provisions set forth in this Section 3.14, such tender offer
rules shall control.
SECTION 3.15 Payment of Taxes and Other Claims. The
Issuer will pay or discharge or cause to be paid or
discharged before the same shall become delinquent, (i) all
material taxes, assessments and governmental charges levied
or imposed upon the Issuer or any Subsidiary of the Issuer
or upon the income, profits or property of the Issuer or any
of its Subsidiaries, and (ii) all material lawful claims for
labor, materials and supplies which, if unpaid, might by law
become a Lien upon the property of the Issuer or any of its
Subsidiaries; provided, however, that the Issuer shall not
be required to pay or discharge or cause to be paid or
discharged any such tax, assessment, charge or claims the
amount, applicability or validity of which is being
contested in good faith by appropriate proceedings and for
which adequate provision has been made.
SECTION 3.16 Commission Reports and Reports to Holders
of Notes. Within 15 days after the Issuer files with the
Commission copies of its annual reports and other
information, documents and reports (or copies of such
portions of any of the foregoing as the Commission may by
rules and regulations prescribe) which it is required to
file with the Commission pursuant to Section 13 or 15(d) of
the Exchange Act, the Issuer shall file the same with the
Trustee. So long as the Notes remain outstanding, the
Issuer shall cause quarterly reports (containing unaudited
financial statements) for the first three quarters of each
fiscal year and annual reports (containing audited financial
statements and an opinion thereon by the Issuer's
independent certified public accountants) which it would be
required to file under Section 13 of the Exchange Act if it
had a class of securities listed on a national securities
exchange to be mailed to the Holders of Notes at their
addresses appearing in the register of Notes maintained by
the registrar within 15 days of when such report would have
been required to be filed under Section 13 of the Exchange
Act. The Issuer also shall comply with the other provisions
of Section 314(a) of the Trust Indenture Act of 1939."
1.3 Amendments to Article Five of the Indenture
(Remedies of the Trustee and Security Holders on Event of
Default). Article Five of the Indenture is hereby amended in
respect of the Notes and only in respect of the Notes by deleting
Sections 5.1 through 5.9 therefrom in their entireties and
substituting in lieu thereof the following new Sections 5.1
through 5.15:
"SECTION 5.1 Events of Default. "Event of Default",
wherever used herein with respect to the Notes, means any
one of the following events (whatever the reason for such
Event of Default and whether or not it shall be occasioned
or prohibited by the provisions of Article Thirteen or
otherwise):
(a) default in the payment of any installment of
interest on the Notes as and when the same becomes due
and payable, and continuance of such default for a
period of 30 days; or
(b) default in the payment of the principal of
the Notes, Redemption Price, Change in Control Purchase
Price, Colombian Sale Redemption Price or Asset Sale
Offer Price when the same becomes due and payable as
provided in this Indenture, whether at its Stated
Maturity, upon redemption, upon declaration of
acceleration, when due for purchase by the Issuer or
otherwise, whether or not such payment shall be
prohibited by this Indenture; or
(c) default in the performance, or breach, of any
covenant or agreement of the Issuer under this
Indenture (other than a default in the performance, or
breach, of a covenant or agreement that is specifically
dealt with elsewhere in this Section 5.1), 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 Issuer by the Trustee or to the
Issuer and the Trustee by the Holders of at least 25%
in principal amount of the outstanding Notes a written
notice specifying such default or breach and stating
that such notice is a "Notice of Default"; or
(d) (i) an event of default shall have occurred
under any mortgage, bond, indenture, loan agreement or
other document evidencing any issue of Indebtedness of
the Issuer or any Material Subsidiary (except for any
Special Subsidiary less than 30% of the common equity
of which is directly or indirectly owned by the Issuer
as of the date of this Indenture) for money borrowed,
which issue has an aggregate outstanding principal
amount of not less than $10,000,000, and such default
shall result in such Indebtedness becoming, whether by
declaration or otherwise, due and payable prior to the
date on which it would otherwise become due and payable
or (ii) a default in any payment when due at final
maturity of any such Indebtedness; or
(e) final judgments or orders rendered against
the Issuer or any Material Subsidiary (except for any
Special Subsidiary less than 30% of the common equity
of which is directly or indirectly owned by the Issuer
as of the date of this Indenture) which require the
payment in money, either individually or in an
aggregate amount, of more than $10,000,000 and such
judgment or order shall remain unsatisfied or unstayed
for 60 consecutive days after such judgement or order
becomes final and nonappealable; or
(f) the entry of a decree or order by a court
having jurisdiction in the premises (i) for relief in
respect of the Issuer or any Material Subsidiary
(except for any Special Subsidiary less than 30% of the
common equity of which is directly or indirectly owned
by the Issuer as of the date of this Indenture) in an
involuntary case or proceeding under the Bankruptcy
Code or any other federal or state bankruptcy,
insolvency, reorganization or similar law or (ii)
adjudging the Issuer or any such Material Subsidiary a
bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment or composition of or in respect
of the Issuer or any such Material Subsidiary under the
Bankruptcy Code or any other applicable federal or
state law; or appointing a custodian, receiver,
liquidator, assignee, trustee, sequestrator (or other
similar official) of the Issuer or any such Material
Subsidiary or of any substantial part of any of their
properties, or ordering the winding up or liquidation
of any of their affairs, and the continuance of any
such decree or order unstayed and in effect for a
period of 60 consecutive days; or
(g) the institution by the Issuer or any Material
Subsidiary (except for any Special Subsidiary less than
30% of the common equity of which is directly or
indirectly owned by the Issuer as of the date of this
Indenture) of a voluntary case or proceeding under the
Bankruptcy Code or any other applicable federal or
state law or any other case or proceedings to be
adjudicated a bankrupt or insolvent, or the consent by
the Issuer or any such Material Subsidiary to the entry
of a decree or order for relief in respect of the
Issuer or any such Material Subsidiary in any
involuntary case or proceeding under the Bankruptcy
Code or any other applicable federal or state law or to
the institution of bankruptcy or insolvency proceedings
against the Issuer or any such Material Subsidiary, or
the filing by the Issuer or any such Material
Subsidiary of a petition or answer or consent seeking
reorganization or relief under the Bankruptcy Code or
any other applicable federal or state law, or the
consent by it to the filing of any such petition or to
the appointment of or taking possession by a custodian,
receiver, liquidator, assignee, trustee, sequestrator
(or other similar official) of any of the Issuer or any
such Material Subsidiary or of any substantial part of
its property, or the making by it of an assignment for
the benefit of creditors, or the admission by it in
writing of its inability to pay its debts generally as
they become due or taking of corporate action by the
Issuer or any such Material Subsidiary in furtherance
of any such action; or
(h) default by the Issuer in the performance or
breach of the terms of Article Nine.
The Issuer shall deliver to the Trustee, immediately
after it becomes aware of the occurrence thereof, written
notice of (i) any Event of Default under this Section 5.1,
or (ii) any event which with the giving of notice or the
lapse of time or both would become an Event of Default under
clause (c) or clause (d), its status and what action the
Issuer is taking or proposes to take with respect thereto.
SECTION 5.2. Acceleration of Maturity; Rescission. If
an Event of Default with respect to the Notes (other than an
Event of Default specified in Section 5.1(f) or 5.1(g))
occurs and is continuing, the Trustee or the Holders of at
least a 25% in aggregate principal amount of the Notes then
outstanding, by written notice to the Issuer (and to the
Trustee if such notice is given by Holders), may, and the
Trustee at the request of such Holders shall, declare the
Notes and the accrued interest thereon (or, prior to
December 15, 1996, the Accreted Amount) to be immediately
due and payable, as specified below. Upon a declaration of
acceleration, such amount shall be due and payable
immediately after receipt by the Issuer of such written
notice given hereunder. If an Event of Default specified in
Section 5.1(f) or 5.1(g) occurs and is continuing, then the
Notes and the accrued interest thereon (or, prior to
December 15, 1996, the Accreted Amount) shall ipso facto
become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any
Holder. At any time after such declaration of acceleration
has been made and before a judgment or decree for payment of
the money due has been obtained by the Trustee as
hereinafter in this Article provided, the Holders of a
majority in aggregate principal amount of the Notes
outstanding, by written notice to the Issuer and the
Trustee, may rescind and annul such declaration and its
consequences if:
(a) the Issuer has paid or deposited with the Trustee
a sum sufficient to pay
(i) all sums paid or advanced by the Trustee
under Section 6.6 and the reasonable compensation,
expenses, disbursements and advances of the Trustee,
its agents and counsel, and
(ii) the amounts payable in respect of any Notes
which have become due otherwise than by such
declaration of acceleration and overdue interest
thereon (to the extent of such overdue interest at the
rate borne by the Notes); and
(b) the rescission would not conflict with any
judgment or decree and if all existing Events of Default,
other than the non-payment of the principal amount or
Accreted Amount of the Notes which have become due solely by
such declaration of acceleration, have been cured or waived.
No such rescission shall affect any subsequent Default
or impair any right consequent thereon provided in Section
5.13.
SECTION 5.3 Collection of Indebtedness and Suits for
Enforcement by Trustee. The Issuer covenants that if an
Event of Default described in Section 5.1(a) or 5.1(b)
occurs and is continuing, the Issuer will, upon demand of
the Trustee, pay to it, for the benefit of the Holders of
such Notes, the whole amount then due and payable on such
Notes, with interest upon the overdue amounts and, to the
extent that payment of such interest shall be legally
enforceable, upon overdue interest, at the rate borne by the
Notes; and, in addition thereto, such further amount as
shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and
counsel.
If the Issuer fails to pay such amounts forthwith upon
such demand, the Trustee, in its own name and as trustee of
an express trust, may institute a judicial proceeding for
the collection of the sums so due and unpaid and may
prosecute such proceeding to judgment or final decree, and
may enforce the same against the Issuer or any other obligor
upon the Notes and collect the moneys adjudged or decreed to
be payable in the manner provided by law out of the property
of the Issuer or any other obligor upon the Notes, wherever
situated.
If an Event of Default with respect to the Notes occurs
and is continuing, the Trustee may in its discretion proceed
to protect and enforce its rights and the rights of the
Holders of Notes 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 the Notes or in
aid of the exercise of any power granted herein or therein,
or to enforce any other proper remedy.
SECTION 5.4 Trustee May File Proofs of Claim. In case
of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement,
adjustment, composition or other judicial proceeding
relative to the Issuer or any other obligor upon the Notes
or the property of the Issuer or such other obligor or their
creditors, the Trustee (irrespective of whether the
principal amount of the Notes, premium, if any, accreted
original issue discount, Redemption Price, Change in Control
Purchase Price, Colombian Sale Redemption Price, Asset Sale
Offer Price, interest, if any, or any other payment required
to be made under this Indenture in connection with the Notes
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 Issuer for the
payment of any such amount) shall be entitled and empowered,
by intervention in such proceeding or otherwise,
(a) to file and prove a claim for the whole
amount, or such lesser amount as may be provided for in
the Notes, of the principal amount of the Notes,
premium, if any, accreted original issue discount,
Redemption Price, Change in Control Purchase Price,
Colombian Sale Redemption Price, Asset Sale Offer
Price, interest, if any, or any other payment required
to be made under this Indenture 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
and counsel) and of the Holders of Notes allowed in
such judicial proceeding, and
(b) 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 Notes 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 Notes, 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
6.6.
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 Note any plan of reorganization,
arrangement, adjustment or composition affecting the Notes
or the rights of any Holder thereof, or to authorize the
Trustee to vote in respect of the claim of any Holder of a
Note in any such proceeding.
SECTION 5.5 Trustee May Enforce Claims without
Possession of Notes. All rights of action and claims under
this Indenture or any of the Notes may be prosecuted and
enforced by the Trustee without the possession of any of the
Notes 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 Note in respect of which such judgment has been
recovered.
SECTION 5.6 Application of Money Collected. Any money
collected by the Trustee pursuant to this Article shall be
applied in the following order, upon presentation of the
Notes and the notation thereon of the payment if only
partially paid and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the
Trustee under Section 6.6;
SECOND: To the payment of the amounts then due
and unpaid upon the Notes for the principal amount of
the Notes, premium, if any, accreted original issue
discount, Redemption Price, Change in Control Purchase
Price, Colombian Sale Redemption Price, Asset Sale
Offer Price, interest, if any, or any other payment
required to be made under this Indenture, as the case
may be, ratably, without preference or priority of any
kind, according to the aggregate amounts due and
payable on such Notes;
THIRD: The balance, if any, to the Issuer.
SECTION 5.7 Limitations on Suits. No Holder of any
Notes 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:
(a) such Holder has previously given written
notice to the Trustee of a continuing Event of Default;
(b) the Holders of not less than 25% in aggregate
principal amount of the Notes at the time outstanding
shall have made written request to the Trustee to
institute proceedings in respect of such Event of
Default;
(c) such Holder or Holders have offered to the
Trustee reasonable indemnity against the costs,
expenses and liabilities to be incurred in compliance
with such request;
(d) the Trustee for 60 days after its receipt of
such notice, request and offer of indemnity has failed
to institute any such proceeding; and
(e) no direction inconsistent with such written
request has been given to the Trustee during such
60-day period by the Holders of a majority in aggregate
principal amount of the outstanding Notes;
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 Note to affect, disturb or prejudice the
rights of any other Holders of Notes, 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 5.8 Unconditional Right of Holders to Receive
Payment. Notwithstanding any other provision in this
Indenture, the Holder of any Note shall have the right,
which is absolute and unconditional, to receive payment of
the principal amount, premium, if any, accreted original
issue discount, Redemption Price, Change in Control Purchase
Price, Colombian Sale Redemption Price, Asset Sale Offer
Price, interest, if any, or any other payment required to be
made under this Indenture with respect to such Note, on the
respective due dates therefor specified in such Note (or, in
the case of redemption, on the Redemption Date or, in the
case of repayment at the option of such Holder as 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 such right shall not be impaired or
affected without the consent of such Holder.
SECTION 5.9 Restoration of Rights and Remedies. If
the Trustee or any Holder of a Note 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 Issuer, 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 5.10 Rights and Remedies Cumulative. Except
as otherwise provided in Section 2.9, no right or remedy
herein conferred upon or reserved to the Trustee or to each
and every Holder of a Note 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 5.11 Delay or Omission Not Waiver. No delay
or omission of the Trustee or of any Holder of any Note 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 Five
or by law to the Trustee or to any Holder of a Note 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 5.12 Control by Holders of Notes. The Holders
of a majority in aggregate principal amount of the
outstanding Notes 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, provided that
(a) such direction shall not be in conflict with
any rule of law or with this Indenture or with the
Notes, and
(b) the Trustee may take any other action deemed
proper by the Trustee which is not inconsistent with
such direction.
SECTION 5.13 Waiver of Past Defaults. The Holders of
not less than a majority in aggregate principal amount of
the outstanding Notes, by notice to the Trustee, on behalf
of the Holders of all the Notes may waive any past Default
hereunder with respect to such Notes and its consequences,
except
(a) an Event of Default described in Section
5.1(a) or 5.1(b), or
(b) a Default in respect of a covenant or
provision that under Section 8.2 cannot be modified or
amended without the consent of the Holder of each
outstanding Note 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 5.14 Waiver of Stay or Extension Laws. The
Issuer 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 Issuer expressly
waives (to the extent that it may lawfully do so) all
benefit or advantage of any such law and covenants that it
will not hinder, delay or impede the execution of any power
herein granted to the Trustee, but will suffer and permit
the execution of every such power as though no such law had
been enacted.
SECTION 5.15 Notice of Defaults. If a Default or an
Event of Default occurs and is continuing with respect to
the Notes and if it is known to the Trustee, the Trustee
shall mail to each Holder of Notes notice of the Default or
Event of Default within 30 days after it occurs and is known
to have occurred by the Trustee, unless such Default or
Event of Default has been cured."
1.4 Amendments to Article Nine of the Indenture
(Consolidation, Merger, Sale, Lease, Exchange or Other
Disposition). Article Nine of the Indenture is hereby amended in
respect of the Notes and only in respect of the Notes by deleting
Section 9.1 thereof in its entirety and substituting in lieu
thereof the following new Section 9.1:
"SECTION 9.1 Issuer May Consolidate, etc., on Certain
Terms. Subject to the provisions of Section 9.2, nothing
contained in this Indenture or in any of the Notes shall
prevent any consolidation or merger of the Issuer with or
into any other Person or Persons (whether or not affiliated
with the Issuer), or successive consolidations or mergers in
which the Issuer or its successor or successors shall be a
party or parties, or shall prevent any sale, lease, exchange
or other disposition of all or substantially all the
property and assets of the Issuer to any other Person
(whether or not affiliated with the Issuer) authorized to
acquire and operate the same; provided, however, the Issuer
hereby covenants and agrees, that any such consolidation,
merger, sale, lease, exchange or other disposition shall be
upon the conditions that (a) the Person (if other than the
Issuer) formed by or surviving any such consolidation or
merger, or to which such sale, lease, exchange or other
disposition shall have been made, shall be a corporation or
partnership organized under the laws of the United States of
America, any state thereof or the District of Columbia; (b)
the due and punctual payment of the principal of and
interest, if any, on all the Notes, according to their
tenor, and the due and punctual performance and observance
of all of the covenants and conditions of this Indenture to
be performed by the Issuer, shall be expressly assumed, by
supplemental indenture satisfactory in form to the Trustee
executed and delivered to the Trustee, by the Person (if
other than the Issuer) formed by such consolidation, or into
which the Issuer shall have been merged, or by the Person
which shall have acquired or leased such property; (c)
immediately after giving effect to such consolidation,
merger, sale, lease, exchange or other disposition, no Event
of Default, and no event which, after notice or lapse of
time or both, would become an Event of Default, shall have
occurred and be continuing; (d) the Person (whether the
Issuer or such other Person) formed by or surviving any such
consolidation or merger, or to which such sale, lease,
exchange or other disposition shall have been made, would
have a pro forma Consolidated Net Worth after giving effect
to the transaction at least equal to the Consolidated Net
Worth of the Issuer prior to the transaction; and (e) except
in the case of a transaction involving a Special Subsidiary,
the Person (whether the Issuer or such other Person) formed
by or surviving any such consolidation or merger, or to
which such sale, lease, exchange or other disposition shall
have been made, could incur an additional $1.00 of
Indebtedness (other than Permitted Indebtedness) pursuant to
Section 3.6 after giving effect to the transaction."
1.5 Amendment to Article Ten of the Indenture
(Satisfaction and Discharge of Indenture; Covenant Defeasance;
Unclaimed Moneys). Article Ten of the Indenture is hereby
amended in respect of the Notes and only in respect of the Notes
by adding thereto the following new Section 10.1(d) in its
appropriate numerical order:
"(d) In addition to the foregoing and provided the
exact amount described in subparagraph (i) below can be
determined at the time of making the deposit referred to in
such subparagraph (i), the Issuer shall be deemed to be, and
shall be, released from its obligations under the covenants
contained in Sections 3.6 through 3.14 and Articles Nine and
Thirteen hereof on the 91st day after the date of the
deposit referred to in subparagraph (i) below, and the
Issuer's obligations under all Notes and this Indenture with
respect to Sections 3.6 through 3.14 and Articles Nine and
Thirteen hereof shall thereafter be deemed to be discharged
for the purposes of any direction, waiver, consent or
declaration (and the consequences of any thereof) in
connection therewith but shall continue in full force and
effect for all other purposes hereunder, and the Trustee, on
demand of the Issuer accompanied by an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions
precedent contemplated by this provision have been complied
with, and at the cost and expense of the Issuer, shall
execute proper instruments acknowledging the same, if
(i) with reference to this provision the Issuer has
irrevocably deposited or caused to be irrevocably deposited
with the Trustee as funds in trust, specifically pledged as
security for, and dedicated solely to, the benefit of the
Holders of the Notes (A) cash in an amount, or (B) U.S.
Government Obligations, maturing as to principal and
interest, if any, at such times and in such amounts as will
insure the availability of cash, or (C) a combination
thereof, sufficient, in the opinion of a nationally
recognized firm of independent public accountants expressed
in a written certification thereof delivered to the Trustee,
to pay the principal of, accreted original issuer discount,
and interest, if any, on all Notes on each date that such
principal, accreted original issue discount or interest, if
any, is due and payable; and
(ii) such deposit will not result in a breach or
violation of, or constitute a default under, any agreement
or instrument to which the Issuer is a party or by which it
is bound; and
(iii) the Issuer has delivered to the Trustee an
Opinion of Counsel to the effect that, and such opinion
shall confirm that, the Holders of the Notes will not
recognize income, gain or loss for Federal income tax
purposes as a result of such deposit, defeasance and
discharge and will be subject to Federal income tax on the
same amount and in the same manner and at the same times, as
would have been the case if such deposit, defeasance and
discharge had not occurred."
1.6 Amendments to Article Twelve of the Indenture
(Redemption of Securities and Sinking Funds). Article Twelve of
the Indenture is hereby amended in respect of the Notes and only
in respect of the Notes by deleting Sections 12.1 through 12.5
therefrom in their entireties and substituting in lieu thereof
the following new Sections 12.1 through 12.8:
"SECTION 12.1 Right of Redemption. The Notes may be
redeemed, at the election of the Issuer, as a whole or from
time to time in part, at the Redemption Prices specified in
the form of Note.
SECTION 12.2 Applicability of Article. Redemption of
Notes at the election of the Issuer or otherwise, as
permitted or required by any provision of this Indenture,
shall be made in accordance with such provision and this
Article Twelve.
SECTION 12.3 Election to Redeem; Notice to Trustee.
The election of the Issuer to redeem any Notes pursuant to
Section 12.1 shall be evidenced by a Board Resolution, a
certified copy of which is delivered to the Trustee. In
case of any redemption at the election of the Issuer, the
Issuer shall, at least 60 days prior to the Redemption Date
fixed by it (unless a shorter notice period shall be
satisfactory to the Trustee), notify the Trustee of such
Redemption Date and of the aggregate principal amount of
Notes to be redeemed.
SECTION 12.4 Selection by Trustee of Notes to Be
Redeemed. If less than all the Notes are to be redeemed,
the particular Notes or portions thereof to be redeemed
shall be selected not more than 60 days and not less than 30
days prior to the Redemption Date by the Trustee from the
outstanding Notes not previously called for redemption,
either pro rata, by lot or by another method the Trustee
shall deem fair and reasonable, and the aggregate principal
amounts to be redeemed may be equal to $1,000 or any
integral multiple thereof.
The Trustee shall promptly notify the Issuer in writing
of the Notes selected for redemption and, in the case of any
Notes selected for partial redemption, the aggregate
principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to redemption of
Notes shall relate, in the case of any Note redeemed or to
be redeemed only in part, to the portion of the aggregate
principal amount of such Note which has been or is to be
redeemed.
SECTION 12.5 Notice of Redemption. Notice of
redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior
to the Redemption Date, to each Holder of Notes to be
redeemed, at its address appearing in the Note register.
All notices of redemption shall state:
(a) the Redemption Date;
(b) the Redemption Price;
(c) if less than all outstanding Notes are to be
redeemed, the identification (and, in the case of a
Note to be redeemed in part, the aggregate principal
amount to be redeemed) of the particular Notes to be
redeemed;
(d) that on the Redemption Date the Redemption
Price together with accrued interest to the Redemption
Date will become due and payable upon each such Note or
portion thereof, and that unless the Issuer shall
default in payment of the Redemption Price and accrued
interest, interest thereon shall cease to accrue on and
after said date;
(e) the place or places where such Notes are to
be surrendered for payment of the Redemption Price;
(f) that Notes called for redemption must be
surrendered to the Paying Agent to collect the
Redemption Price;
(g) the CUSIP number, if any, relating to such
Notes; and
(h) in the case of a Note to be redeemed in part,
the aggregate principal amount of such Note to be
redeemed and that after the Redemption Date upon
surrender of such Note, new Note or Notes in the
aggregate principal amount equal to the unredeemed
portion thereof will be issued.
Notice of redemption of Notes to be redeemed at the
election of the Issuer shall be given by the Issuer or, at
its request, by the Trustee in the name and at the expense
of the Issuer.
SECTION 12.6 Deposit of Redemption Price. On or prior
to 11:00 a.m., New York City time, on any Redemption Date,
the Issuer shall deposit with the Trustee or with a Paying
Agent (or, if the Issuer is acting as its own Paying Agent,
segregate and hold in trust) an amount of money in same day
funds (or New York Clearing House funds if such deposit is
made prior to the applicable Redemption Date) sufficient to
pay the Redemption Price of all the Notes or portions
thereof which are to be redeemed on that Redemption Date
plus accrued interest to such Redemption Date.
SECTION 12.7 Notes Payable on Redemption Date. Notice
of redemption having been given as aforesaid, the Notes so
to be redeemed shall, on the Redemption Date, become due and
payable at the Redemption Price therein specified plus
accrued interest to the Redemption Date and from and after
such date (unless the Issuer shall default in the payment of
the Redemption Price) such Notes shall cease to accrue
interest. Upon surrender of any such Note for redemption in
accordance with said notice, such Note shall be paid by the
Issuer at the Redemption Price.
If any Note called for redemption shall not be so paid
upon surrender thereof for redemption, the Redemption Price
thereof shall accrue interest at the rate of 9-3/4% per
annum.
SECTION 12.8 Notes Redeemed in Part. Any Note that is
to be redeemed only in part shall be surrendered at the
office or agency of the Issuer maintained for such purpose
pursuant to Section 3.2 (with, if the Issuer or the Trustee
so requires, due endorsement by, or a written instrument of
transfer in form satisfactory to the Issuer or the Trustee
duly executed by, the Holder thereof or its attorney duly
authorized in writing), and the Issuer shall execute, and
the Trustee shall authenticate and deliver to the Holder of
such Note without service charge, a new Note or Notes, of
any authorized denomination as requested by such Holder in
aggregate principal amount equal to and in exchange for the
unredeemed portion of the principal amount of the Note so
surrendered."
SECTION 2. MISCELLANEOUS.
2.1 The Trustee. The recitals contained herein shall
be taken as the statements of the Issuer and the Trustee shall
not assume responsibility for, or be liable in respect of, the
correctness thereof. The Trustee makes no representation as to,
and shall not be liable or responsible for, the validity or
sufficiency of this Supplemental Indenture.
2.2 Limited Effect. Except as expressly amended
hereby, all of the provisions, covenants, terms and conditions of
the Indenture are ratified and confirmed, and shall remain in
full force.
2.3 Counterparts. This Supplemental Indenture may be
executed by one or more parties hereto on any number of separate
counterparts, and all of said counterparts taken together shall
be deemed to constitute one and the same instrument.
2.4 GOVERNING LAW. THIS SUPPLEMENTAL INDENTURE SHALL
BE DEEMED TO BE A CONTRACT UNDER THE LAWS OF THE STATE OF NEW
YORK AND FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF SUCH STATE, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAWS.
IN WITNESS WHEREOF, the parties hereto have caused this
Supplemental Indenture to be duly executed, all as of the date
first above written.
TRITON ENERGY CORPORATION, as
Issuer
Attest: \\Robert B. Holland, III By: \\Peter Rugg
------------------------ --------------------
Title: Senior Vice President Title: Senior Vice President
UNITED STATES TRUST COMPANY OF
NEW YORK, as Trustee
Attest:____________________ By:___________________________
Title: Title:
EXHIBIT A
[FORM OF FACE OF SECURITY]
FOR PURPOSES OF SECTION 1271 ET SEQ. OF THE INTERNAL REVENUE CODE,
THE AMOUNT OF ORIGINAL ISSUE DISCOUNT WITH RESPECT TO EACH $1,000
OF PRINCIPAL AMOUNT OF THIS SECURITY IS $248.24, THE ISSUE DATE IS
DECEMBER 16, 1993 AND THE YIELD TO MATURITY IS 9-3/4%.
TRITON ENERGY CORPORATION
9-3/4% Senior Subordinated Discount Notes due 2000
No. ____
Issue Date: December 16, 1993
Issue Price: $751.76
(for each $1,000 principal amount)
Original Issue Discount: $248.24
(for each $1,000 principal amount)
Triton Energy Corporation, a Texas corporation (the
"Issuer"), promises to pay to ____________ or its registered
assigns, the principal amount of ___________ DOLLARS ($__________)
on December 15, 2000. This Note shall not bear interest except as
specified on the other side of this Note. Additional provisions of
this Note are set forth on the other side of this Note.
IN WITNESS WHEREOF, the Issuer has caused this instrument
to be duly executed under its facsimile corporate seal.
TRITON ENERGY CORPORATION, as
Issuer
Attest:____________________ By:___________________________
Title: Title:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated
herein referred to in the within-mentioned Indenture.
Dated: December 16, 1993 UNITED STATES TRUST COMPANY OF
NEW YORK, as Trustee
By:___________________________
Authorized Signatory
[FORM OF REVERSE SIDE OF NOTE]
9-3/4% Senior Subordinated Discount Note due 2000
1. Interest. There will be no payments of interest on
this Note prior to December 15, 1996. Commencing December 15, 1996,
interest on this Note will accrue at the rate of 9-3/4% per annum
and will be payable in cash semiannually on each December 15 and
June 15, commencing June 15, 1997, to Holders of record on the close
of business on the immediately preceding December 1 and June 1;
provided that if the principal amount hereof or any portion of such
principal amount is not paid when due (whether upon acceleration
pursuant to Section 5.2 of the Indenture, upon the date set for
payment of the Redemption Price pursuant to paragraph 6 hereof, upon
the date set for payment of the Change in Control Purchase Price or
Colombian Asset Redemption Price, or other required payments
pursuant to paragraph 8 hereof or upon the Stated Maturity of this
Note), then in each such case the overdue amount shall bear interest
at the rate of 9-3/4% per annum, compounded semiannually (to the
extent that the payment of such interest shall be legally
enforceable), which interest shall accrue from the date such overdue
amount was due to the date payment of such amount, including
interest thereon, has been made or duly provided for. All such
interest shall be payable on demand.
2. Original Issue Discount. Original issue discount
(the difference between the issue price and the principal amount of
the Note), in the period during which any of the Notes remains
outstanding, shall accrue at a rate of 9 % per annum, on a
semiannual bond equivalent basis using a 360-day year composed of
twelve 30-day months, commencing on the date of issuance of this
Note.
3. Method of Payment. Subject to the terms and
conditions of the Indenture, payments in respect of the Notes shall
be made at the office or agency of the Issuer maintained for that
purpose in the City and State of New York or, at the option of the
Issuer, payments in respect of the Notes may be made by check mailed
to the Holders of the Notes at their respective addresses set forth
in the register of Holders of Notes. The Issuer will pay cash
amounts in money of the United States that at the time of payment
is legal tender for payment of public and private debts.
4. Paying Agent and Registrar. Initially, United
States Trust Company of New York (the "Trustee"), will act as paying
agent and registrar. The Issuer may appoint and change any paying
agent or registrar without notice, other than notice to the Trustee.
The Issuer or any of its Subsidiaries or any of their Affiliates may
act as paying agent or registrar.
5. Indenture. The Issuer issued the Notes under an
Indenture, dated as of December 15, 1993, between the Issuer and the
Trustee, as supplemented by a First Supplemental Indenture, dated
as of December 15, 1993 (collectively, the "Indenture"). The terms
of the Notes include those stated in the Indenture and those made
part of the Indenture by reference to the Trust Indenture Act of
1939, as amended (the "Trust Indenture Act of 1939"). Capitalized
terms used herein and not defined herein have the meanings ascribed
thereto in the Indenture. The Notes are subject to all such terms,
and holders are referred to the Indenture and the Trust Indenture
Act of 1939 for a statement of those terms.
The Notes are general unsecured obligations of the Issuer,
limited to $170 million aggregate principal amount.
6. Subordination. The Indebtedness represented by the
Notes is expressly subordinate and junior in right of payment, in
the manner and to the extent set forth in the Indenture, to the
prior payment in full of all Senior Indebtedness of the Issuer
whether outstanding on the date of such Indenture or thereafter
created, incurred, assumed or guaranteed. Each Holder of a Note by
its acceptance hereof agrees and accepts to be bound by such
provisions.
7. Redemption at the Option of the Issuer. No sinking
fund is provided for the Notes. Commencing December 15, 1997, the
Notes will be subject to redemption at the option of the Company,
in whole or in part, at any time and from time to time, upon not
less than 30 nor more than 60 days' notice, at the redemption prices
(expressed as a percentage of principal amount) set forth below plus
accrued and unpaid interest to the redemption date, if redeemed
during the 12-month period beginning on December 15 of the years
indicated below:
<TABLE>
Year Percentage
<S> <C>
1997 . . . . . . . . . . . . . . 104.875%
1998 . . . . . . . . . . . . . . 102.438%
1999 and thereafter . . . . . . . . 100.000%
</TABLE>
8. Notice of Redemption. Notice of redemption will be
mailed at least 30 days but not more than 60 days before the
Redemption Date to each Holder of Notes to be redeemed at the
Holder's registered address. If money sufficient to pay the
Redemption Price of all Notes to be redeemed on the Redemption Date,
together with accrued interest thereon to the Redemption Date, is
deposited with the Paying Agent prior to or on the Redemption Date,
on and after such date interest ceases to accrue on such Notes or
portions thereof.
9. Offers to Repurchase the Notes by the Issuer. In
certain circumstances relating to Asset Sales and Changes in Control
described in the Indenture, the Issuer may be required to make
offers to repurchase the Notes.
10. Denominations; Transfer; Exchange. The Notes are
in registered form, without coupons, in denominations of $1,000 of
principal amount and integral multiples of $1,000. A Holder may
register the transfer of or exchange Notes in accordance with the
Indenture. The registrar may require a Holder, among other things,
to furnish appropriate endorsements and transfer documents and to
pay any taxes and fees required by law or permitted by the
Indenture. The Issuer shall not be required to exchange or register
a transfer of (a) any Notes for a period of 15 days next preceding
the first mailing or publication of notice of redemption of Notes
to be redeemed, (b) any Notes selected, called or being called for
redemption, in whole or in part, except, in the case of any Note to
be redeemed in part, the portion thereof not so to be redeemed or
(c) any Note if the Holder thereof has exercised its right, if any,
to require the Issuer to repurchase such Note in whole or in part,
except the portion of such Note not required to be repurchased.
11. Persons Deemed Owners. The registered Holder of
this Note may be treated as the owner of this Note for all purposes.
12. Unclaimed Money. The Trustee and each paying agent
shall each return to the Issuer upon written request any money held
by them for the payment of any amount with respect to the Notes that
remains unclaimed for two years. After return to the Issuer,
Holders entitled to the money must look to the Issuer for payment
as general creditors unless an applicable abandoned property law
designates another person.
13. Amendment; Waiver. Subject to certain exceptions
set forth in the Indenture, (i) the Indenture or the Notes may be
amended with the written consent of the Holders of at least a
majority in aggregate principal amount of the Notes at the time
outstanding and (ii) certain defaults or noncompliance with certain
provisions may be waived with the written consent of the Holders of
a majority in aggregate principal amount of the Notes at the time
outstanding. Subject to certain exceptions set forth in the
Indenture, without the consent of any Holder, the Issuer and the
Trustee may amend the Indenture or the Notes to cure any ambiguity,
defect or inconsistency, or to comply with Article Nine of the
Indenture, or to make any change that does not adversely affect the
rights of any Holder of Notes.
14. Defaults and Remedies. Under the Indenture, Events
of Default include, among others, (i) default in the payment of any
installment of interest on the Notes as and when the same becomes
due and payable, and continuance of such default for a period of 30
days; (ii) default in the payment of the principal amount,
Redemption Price, Change in Control Purchase Price, Colombian Sale
Redemption Price or Asset Sale Offer Price when the same becomes due
and payable; (iii) failure by the Issuer to comply with other
agreements in the Indenture or the Notes, subject to notice and
lapse of time; (iv) certain Indebtedness of the Issuer or certain
Subsidiaries of the Issuer for money borrowed in an aggregate
outstanding principal amount of $10,000,000 or more becoming due and
payable prior to final maturity thereof or default in any payment
when due at final maturity of any such Indebtedness; (v) certain
judgments or orders rendered against the Issuer or certain
Subsidiaries of the Issuer in an aggregate principal amount of more
than $10,000,000; and (vi) certain events of bankruptcy or
insolvency. If an Event of Default occurs and is continuing, the
Trustee, or the Holders of at least 25% in aggregate principal
amount of the Notes at the time outstanding, may declare all the
Notes to be due and payable immediately. Certain events of
bankruptcy or insolvency are Events of Default which will result in
the Notes becoming due and payable immediately upon the occurrence
of such Events of Default.
Holders of Notes may not enforce the Indenture or the
Notes except as provided in the Indenture. The Trustee may refuse
to enforce the Indenture or the Notes unless it receives reasonable
indemnity or security. Subject to certain limitations, Holders of
a majority in aggregate principal amount of the Notes at the time
outstanding may direct the Trustee in its exercise of any trust or
power. The Trustee may withhold from Holders of Notes notice of any
continuing Default (except a Default in payment of amounts specified
in clauses (i) and (ii) above) if it determines that withholding
notice is in their best interests.
15. Trustee Dealings with the Issuer. Subject to
certain limitations imposed by the Trust Indenture Act of 1939, the
Trustee under the Indenture, in its individual or any other
capacity, may become the owner or pledgee of Notes and may otherwise
deal with and collect obligations owed to it by the Issuer or its
Affiliates and may otherwise deal with the Issuer or its Affiliates
with the same rights it would have if it were not Trustee.
16. No Recourse Against Others. A director, officer,
employee or stockholder, as such, of the Issuer shall not have any
liability for any obligations of the Issuer under the Notes or the
Indenture or for any claim based on, in respect of or by reason of
such obligations or their creation. By accepting a Note, each Note
Holder waives and releases all such liability. The waiver and
release are part of the consideration for the issue of the Notes.
17. Authentication. This Note shall not be valid until
an authorized signatory of the Trustee manually signs the Trustee's
Certificate of Authentication on the other side of this Note.
18. Defeasance, Covenant Defeasance. The Notes are
subject to defeasance and covenant defeasance as provided in the
Indenture.
19. Abbreviations. Customary abbreviations may be used
in the name of a Holder of Notes or an assignee, such as TEN COM (=
tenants in common), TEN ENT (= tenants by the entireties), JT TEN
(= joint tenants with right of survivorship and not as tenants in
common), CUST (= custodian), and U/G/M/A (= Uniform Gift to Minors
Act).
20. GOVERNING LAW. THIS NOTE AND THE INDENTURE SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE
STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAW.
The Issuer will furnish to any Holder of Notes upon
written request and without charge a copy of the Indenture.
Requests may be made to: Triton Energy Corporation, 6688 North
Central Expressway, Suite 1400, Dallas, Texas 75206, Attention of
Corporate Secretary.
EXHIBIT B
INTERCOMPANY AGREEMENT
Dallas, Texas
_________, ____
FOR VALUE RECEIVED, the undersigned, ________________, a
___________ corporation ("Maker"), hereby unconditionally promises
to pay to the order of Triton Energy Corporation, a Texas
corporation ("Payee"), at 6688 North Central Expressway, Suite 1400,
Dallas, Texas 75206, or such other address given to Maker by Payee,
the principal sum of ________ DOLLARS ($________).
SECTION 1. Payment Obligations. Maker shall pay interest
the _____ day of _____ of each year. Interest shall accrue at the
rate of ______% above the prime rate quoted from time to time by
Morgan Guaranty Trust Company or New York with respect to loans to
its preferred customers. After maturity, this Note shall bear
interest at the highest lawful rate.
All unpaid principal of and accrued but unpaid interest
on this Note shall be payable on ___________, ____.
SECTION 2. Default Rate. All past due principal of and,
to the extent permitted by applicable law, interest upon this Note
shall bear interest at the lesser of the highest lawful rate and
____% per annum.
SECTION 3. Rights and Remedies. If Maker shall fail to
pay when due the accrued interest on this Note and such failure
shall not be cured within five days, then Payee may declare the
unpaid principal of this Note, and unpaid interest on this Note, to
be immediately due and payable, and the same shall thereupon become
due and payable, without notice, demand, presentment, notice of
dishonor, notice of acceleration, notice of intent to accelerate,
protest or other formalities of any kind, all of which are hereby
expressly waived by Maker.
SECTION 4. Waiver. Maker and each surety, endorser,
guarantor and other party ever liable for payment of any sums of
money payable upon this Note, jointly and severally waive
presentment, demand, protest, notice of protest and non-payment or
other notice of any kind, and agree that their liability under this
Note shall not be affected by any renewal or extension in the time
of payment hereof, or in any indulgences, or by any release or
change in any security for the payment of this Note, and hereby
consent to any and all renewals, extensions, indulgences, releases
or changes, regardless of the number of such renewals, extensions,
indulgences, releases or changes.
No waiver by Payee of any of its rights or remedies
hereunder or under any other document evidencing or securing this
Note or otherwise, shall be considered a waiver of any other
subsequent right or remedy of Payee; no delay or omission in the
exercise or enforcement by Payee of any rights or remedies shall
ever be construed as a waiver of any right or remedy of Payee; and
no exercise or enforcement of any such rights or remedies shall ever
be held to exhaust any right or remedy of Payee.
SECTION 5. Subsequent Advances. This Note shall
represent the unpaid principal balance of an account payable owing
by Maker to Payee on the date hereof. Payee shall have no
obligation to make any additional advances to Maker.
SECTION 6. Notice. Whenever this Note requires or permits
any notice, approval, request or demand from one party to another,
the notice, approval, request or demand must be in writing and shall
be deemed to have been given when personally served or when
deposited in the United States mails, registered or certified,
return receipt requested, addressed to the party to be notified at
the following address (or at such other address as may have been
designated by written notice):
Payee: Triton Energy Corporation
6688 North Central Expressway
Suite 1400
Dallas, Texas 75206
Maker: __________________________
__________________________
__________________________
__________________________
The foregoing is not intended and shall not be deemed under any
circumstances to require the holder hereof to give notice of any
type or nature to Maker not expressly required by other provisions
of this Note.
SECTION 7. Usury Laws. Regardless of any provisions contained
in this Note, the Payee shall never be deemed to have contracted for
or be entitled to receive, collect or apply as interest on the Note,
any amount in excess of the highest lawful rate, and, in the event
Payee ever receives, collects or applies as interest any such
excess, such amount which would be excessive interest shall be
applied to the reduction of the unpaid principal balance of this
Note, and, if the principal balance of this Note is paid in full,
any remaining excess shall forthwith be paid to Maker. In
determining whether or not the interest paid or payable under any
specific contingency exceeds the highest lawful rate, Maker and
Payee shall, to the maximum extent permitted under applicable law,
(i) characterize any non-principal payment (other than payments
which are expressly designated as interest payments hereunder) as
an expense, fee, or premium, rather than as interest, (ii) exclude
voluntary prepayments and the effects thereof and (iii) spread the
total amount of interest throughout the entire contemplated term of
this Note so that the interest rate is uniform throughout such
term.
SECTION 8. APPLICABLE LAW. THIS NOTE IS INTENDED TO BE
PERFORMED IN THE STATE OF TEXAS. EXCEPT TO THE EXTENT THAT THE LAWS
OF THE UNITED STATES MAY APPLY TO THE TERMS HEREOF, THE SUBSTANTIVE
LAWS OF THE STATE OF TEXAS SHALL GOVERN THE VALIDITY, CONSTRUCTION,
ENFORCEMENT AND INTERPRETATION OF THIS NOTE.
By:_______________________________________
TRITON ENERGY CORPORATION
RETIREMENT INCOME PLAN
as amended and restated
effective June 1, 1993
PREAMBLE
The purpose of this Plan and Trust is to provide, in accordance with its
provisions, a defined benefit pension plan providing retirement and other
related benefits for those Employees of the Employer who are eligible to
participate hereunder. This document is a complete amendment and restatement
of the Triton Energy Corporation Retirement Income Plan, which was originally
effective as of June 1, 1981.
It is intended that the Plan qualify for approval under Sections 401 and 410
through 417 of the Internal Revenue Code. It is intended that the Trust
qualify for approval under Section 501 of the Code. It is further intended
that the Plan comply with the provisions of the Employee Retirement Income
Security Act of 1974 (ERISA). In case of any ambiguity in the Plan's
language, it will be interpreted to accomplish the Plan's intent of qualifying
under the Code and complying with ERISA.
This Plan and Trust is exclusively for the benefit of the eligible Employees
and their Beneficiaries. Neither the Employer, the Plan Administrator nor the
Trustee will apply or interpret the terms of the Plan in any manner that
permits discrimination in favor of Highly Compensated Employees. All
Employees under similar circumstances will be treated alike.
The undersigned Employer and Trustee hereby adopt this restatement of the
Triton Energy Corporation Retirement Income Plan to be effective as of June 1,
1993.
TABLE OF CONTENTS
PAGE NO.
----------
ARTICLE 1 - DEFINITIONS 1-1
ARTICLE 2 - PARTICIPATION 2-1
ARTICLE 3 - RETIREMENT BENEFITS 3-1
ARTICLE 4 - DEATH BENEFIT 4-1
ARTICLE 5 - TERMINATION OF EMPLOYMENT 5-1
ARTICLE 6 - ACCRUED BENEFIT 6-1
ARTICLE 7 - LIMITATIONS ON BENEFITS 7-1
ARTICLE 8 - MISCELLANEOUS 8-1
ARTICLE 9 - ADMINISTRATION 9-1
ARTICLE 10 - AMENDMENT OR TERMINATION
OF PLAN 10-1
ARTICLE 11 - TRUSTEE AND TRUST FUND 11-1
ARTICLE 1
DEFINITIONS
As used in this document, unless otherwise defined or required by the context,
the following terms have the meanings set forth in this Article 1. Some of
the terms used in this document are not defined in Article 1, but for
convenience are defined as they are introduced in the text.
1.01 Accrued Benefit
Subject to the provisions of Article 6, the Accrued Benefit for each
Participant is determined using the same formula which is used to
compute the Participant's Normal Retirement Benefit, taking into account
the Participant's Years of Benefit Service and Average Monthly
Compensation through the date of determination.
1.02 Actuarial Equivalent
Actuarial Equivalent means a form of benefit differing in time, period
and/or manner of payment from another form of benefit but having the
same value when computed based upon the following interest and mortality
assumptions:
Interest: 8% per annum, compounded annually
Mortality: 1983 Group Annuity Mortality Table using unisex
rates which are blended using 50% male rates
and 50% female rates
The present value of any Accrued Benefit for purposes of determining the
amount of a lump sum distribution will be equal to the greater of the
present value determined using the interest rate specified above or the
present value determined using the "Applicable Interest Rate."
The Applicable Interest Rate is the rate or rates that would be used by
the Pension Benefit Guaranty Corporation for a trusteed single-employer
plan to value a Participant's or Beneficiary's benefit on the first day
of the Plan Year in which distribution is made (the "PBGC Rate"). If
the present value using the PBGC Rate exceeds $25,000, the Applicable
Interest Rate is 120% of the PBGC Rate. However, the use of 120% of the
PBGC Rate will never result in a present value less than $25,000.
1.03 Average Monthly Compensation
A Participant's Average Monthly Compensation, as of a given date, is
determined by dividing the total Compensation he received during the 5
consecutive Compensation Periods for which his Compensation was highest
by the number of months during such period for which he received
Compensation. No fractional Compensation Periods resulting from a
Participant's date of employment or date of termination will be taken
into account.
A Participant's Excess Average Monthly Compensation is that portion, if
any, of his Average Monthly Compensation which is in excess of his
monthly Integration Level.
1-1
1.04 Beneficiary
Beneficiary means the person, persons, trust or other entity who is
designated to receive any amount payable upon the death of a
Participant.
1.05 Code and ERISA
Code means the Internal Revenue Code of 1986, as it may be amended from
time to time, and all regulations issued thereunder. Reference to a
section of the Code includes that section and any comparable section or
sections of any future legislation that amends, supplements or
supersedes such section and any regulations issued thereunder.
ERISA means Public Law No. 93-406, the Employee Retirement Income
Security Act of 1974, as it may be amended from time to time, and all
regulations issued thereunder. Reference to a section of ERISA includes
that section and any comparable section or sections of any future
legislation that amends, supplements or supersedes such section and any
regulations issued thereunder.
1.06 Compensation
Except where otherwise specifically provided in this Plan, Compensation
means Aggregate Compensation as defined in Section 7.03(a), excluding
bonuses and severence pay.
Compensation also includes any amounts contributed by the Employer or
any Related Employer on behalf of any Employee which are not includable
in the gross income of the Employee due to Code Section 125, 402(a)(8),
402(h) or 403(b).
Notwithstanding the foregoing, for all purposes under this Plan,
Compensation in excess of $200,000 (as adjusted in accordance with Code
Section 401(a)(17)) will be disregarded. For purposes of applying this
compensation limit, a Family Member of a Highly Compensated Employee is
subject to the single aggregate compensation limit imposed on the Highly
Compensated Employee if the Family Member is either the Employee's
spouse or is a lineal descendant who has not attained the age of 19 by
the end of the Plan Year.
Compensation Period means the 12 month period which begins each January
1 and ends each December 31.
1.07 Effective Date
The Effective Date of the Plan is June 1, 1981.
Except as specified elsewhere in this document, the effective date of
this restatement of the Plan is June 1, 1993.
Sections 1.09, 1.32, 1.33, 1.36, 7.01, 7.02, 7.03, 7.04, and the last
two paragraphs of Section 1.02 are effective June 1, 1987.
1.08 Eligible Employee Classification
An Eligible Employee Classification is a classification of Employees,
the members of which are eligible to participate in the Plan. The Plan
covers all employee classifications except Leased Employees and members
1-2
of a legally recognized collective bargaining unit who are not expressly
granted permission to participate.
1.09 Employee
(a) In General
An Employee is any person who is employed by the Employer or a
Participating Employer.
(b) Leased Employee
A Leased Employee means any person who, pursuant to an agreement
between the Employer or any Related Employer ("Recipient Employer")
and any other person ("leasing organization"), has performed
services for the Recipient Employer on a substantially full-time
basis for a period of at least one year and such services are of a
type historically performed by employees in the business field of
the Recipient Employer.
Any Leased Employee will be treated as an Employee of the Recipient
Employer; however, contributions or benefits provided by the leasing
organization which are attributable to the services performed for
the Recipient Employer will be treated as provided by the Recipient
Employer. If all Leased Employees constitute less than 20% of the
Employer's non-highly-compensated work force within the meaning of
Code Section 414(n)(1)(C)(ii), then the preceding sentence will not
apply to any Leased Employee if such Employee is covered by a money
purchase pension plan ("Safe Harbor Plan") which provides: (1) a
nonintegrated employer contribution rate of at least 10% of
compensation, (2) immediate participation, and (3) full and
immediate vesting.
Years of Eligibility Service for purposes of eligibility to
participate in the Plan and Years of Vesting Service for purposes of
determining a Participant's Vested Percentage include service by an
Employee as a Leased Employee.
1.10 Employer
The Employer and Plan Sponsor is Triton Energy Corporation. A
Participating Employer is any organization which has adopted this Plan
and Trust in accordance with Section 8.07.
The term Predecessor Employer means any prior employer to which the
Employer is the successor, including any Predecessor Employer for which
the Employer maintains the obligations of a Predecessor Plan established
by such Predecessor Employer. Service with a Predecessor Employer will
be included as Service with the Employer for all purposes under this
Plan.
1.11 Employment Commencement Date
The date an Employee first performs an Hour of Service for the Employer
is his Employment Commencement Date.
1-3
1.12 Entry Date
Entry Date means the January 1st, April 1st, July 1st or October 1st
which coincides with or next follows an Employee's Employment
Commencement Date.
1.13 Expected Retirement Benefit
A Participant's Expected Retirement Benefit as of a given date is his
monthly Normal Retirement Benefit determined on the basis that he
continues to be an Active Participant until his Normal Retirement Date
and assuming no future changes in his Compensation.
1.14 Fiscal Year
Fiscal Year means the taxable year of the Plan Sponsor. The Fiscal Year
of the Plan Sponsor is the 12 month period beginning June 1 and ending
May 31.
1.15 Highly Compensated Definitions
(a) Compensation
For purposes of this Section, Compensation means Aggregate
Compensation as defined in Section 7.03(a) plus amounts contributed
by the Employer pursuant to a salary reduction agreement which are
excludable from the gross income of the Employee under Code Section
125, 402(a)(8), 402(h) or 403(b). Compensation in excess of
$200,000 (as adjusted by the Secretary of the Treasury under Code
Section 415(d)) is disregarded.
(b) Determination Year
Determination Year means the Plan Year for which the determination
of who is Highly Compensated is being made.
(c) Family Member
Family Member means an Employee who is the spouse, a lineal
ascendant or descendant, or the spouse of a lineal ascendant or
descendant of:
o a 5-percent owner (within the meaning of Code Section 416(i)) of
the Employer or any Related Employer who is an active or former
Employee; or
o a Highly Compensated Employee who is one of the 10 most highly
compensated employees ranked on the basis of Compensation paid
by the Employer during the Determination Year or the Lookback
Year.
For purposes of this Section, the Family Member and the Highly
Compensated Employee will be considered one Employee. A Family
Member's Compensation and benefits will be aggregated with those of
the Highly Compensated Employee irrespective of whether the Family
Member would otherwise be treated as a Highly-Compensated Employee
or is in a category of Employees which may be excluded in
determining the number of Employees in the Top-Paid Group.
If an Employee is required to be aggregated as a member of more than
1-4
one family group, all eligible employees who are members of those
family groups which include that employee will be aggregated as one
family group.
For purposes of applying the compensation limit under Code Section
401(a)(17), a Family Member is subject to the single aggregate
compensation limit imposed on the Highly Compensated Employee if the
Family Member is either the Employee's spouse or is a lineal
descendant who has not attained the age of 19 by the end of the Plan
Year.
(d) Highly Compensated Employee
Highly Compensated Employee means any individual who is a Highly
Compensated Active Employee or a Highly Compensated Former Employee
within the meaning of Code Section 414(q) and the regulations
thereunder.
(e) Highly Compensated Active Employee
Highly Compensated Active Employee means any individual who during
the Determination Year or the Lookback Year:
(1) Was at any time a 5-percent Owner (within the meaning of Code
Section 416(i)) of the Employer or any Related Employer;
(2) Received Compensation from the Employer and all Related
Employers in excess of $75,000 (or any greater amount determined
by regulations issued by the Secretary of the Treasury under
Code Section 415(d));
(3) Received Compensation from the Employer and all Related
Employers in excess of $50,000 (or any greater amount determined
by regulations issued by the Secretary of the Treasury under
Code Section 415(d)) and was in the Top-Paid Group of Employees;
or
(4) Was an Officer of the Employer or any Related Employer (as that
term is defined in the regulations under Code Section 416(i))
and received Compensation greater than 50% of the Defined
Benefit Dollar Limit described in Section 7.03(f) for the
applicable year. For this purpose, if no Officer received
enough Compensation to be a Highly Compensated Employee under
the preceding sentence, the highest-paid Officer will be treated
as a Highly Compensated Employee. The maximum number of
Officers who will be treated as Highly Compensated Active
Employees under this paragraph is equal to 10% of all Employees
determined without regard to statutory or other exclusions,
subject to a minimum of 3 Employees and a maximum of 50
Employees.
No individual described in subparagraphs (2), (3) or (4) above will
be treated as a Highly Compensated Active Employee for the
Determination Year unless he (i) was a Highly Compensated Active
Employee for the Lookback Year (or would have been except that he
was not among the 100 most highly compensated Employees of the
1-5
Employer and all Related Employers for the Lookback Year) or (ii)
was among the 100 most highly compensated Employees of the Employer
and all Related Employers for the Determination Year.
(f) Highly Compensated Former Employee
Highly Compensated Former Employee means any Former Employee who had
a Separation Year (within the meaning of Treasury Regulation Section
1.414(q)-1T Q&A-5) and was a Highly Compensated Active Employee for
either the Separation Year or any Determination Year ending on or
after the Employee's 55th birthday.
(g) Highly Compensated Group
Highly Compensated Group means all Highly Compensated Employees.
(h) Lookback Year
Lookback Year means the 12-month period immediately preceding the
Determination Year.
(i) Non-Highly Compensated Employee
Non-Highly Compensated Employee means an Employee who is neither a
Highly Compensated Employee nor a Family Member.
(j) Non-Highly Compensated Group
Non-Highly Compensated Group means all Non-Highly Compensated
Employees.
(k) Top-Paid Group
Top-Paid Group means those individuals who are among the top 20
percent of Employees of the Employer and all Related Employers when
ranked on the basis of Compensation received during the year. In
determining the number of individuals in the Top-Paid Group (but not
the identity of those individuals), the following individuals may be
excluded:
(1) Employees who have not completed 6 months of Service by the end
of the year. For this purpose, an Employee who has completed
One Hour of Service in any calendar month will be credited with
one month of Service;
(2) Employees who normally work fewer than 17 1/2 hours per week;
(3) Employees who normally work fewer than 6 months during any
year. For this purpose, an Employee who has worked on one day
of a month is treated as having worked for the whole month;
(4) Employees who have not reached age 21 by the end of the year;
(5) Nonresident aliens who received no earned income (which
constitutes income from sources within the United States) within
the year from the Employer or any Related Employer; and
(6) Employees covered by a collective bargaining agreement
negotiated in good faith between the employee representatives
and the Employer or a group of employers of which the Employer
1-6
is a member if (i) 90% or more of all employees of the Employer
and all Related Employers are covered by collective bargaining
agreements, and (ii) this Plan covers only Employees who are not
covered under a collective bargaining agreement.
1.16 Hour of Service
An Hour of Service means:
(a) Each hour for which an Employee is paid, or entitled to payment, for
the performance of duties for the Employer. These hours will be
credited to the Employee for the computation period in which the
duties are performed;
(b) Each hour for which an Employee is paid, or entitled to payment, by
the Employer on account of a period of time during which no duties
are performed (irrespective of whether the employment relationship
has terminated) due to vacation, holiday, illness, incapacity
(including disability), layoff, jury duty, military duty or leave of
absence. No more than 501 Hours of Service will be credited under
this paragraph for any 12-month period. Hours under this paragraph
will be calculated and credited pursuant to Section 2530.200b-2 of
the Department of Labor Regulations which are incorporated herein by
this reference; and
(c) Each hour for which back pay, irrespective of mitigation of damages,
is either awarded or agreed to by the Employer. The same Hours of
Service will not be credited both under paragraphs (a) or (b), as
the case may be, and under this paragraph (c). These hours will be
credited to the Employee for the computation period or periods to
which the award or agreement pertains rather than the computation
period in which the award, agreement or payment is made.
Hours of Service for all Employees will be determined on the basis of
actual hours for which an Employee is paid or is entitled to payment.
Hours of Service will be credited for employment with any Related
Employer or any Predecessor Employer. Hours of Service will be credited
for any individual considered an employee under Code Section 414(n) or
414(o) and the regulations thereunder.
Solely for purposes of determining whether a One Year Break-in-Service
has occurred, a Participant who is absent from work on an authorized
Leave of Absence or by reason of the Participant's pregnancy, birth of
the Participant's child, placement of a child with the Participant in
connection with the adoption of such child, or for the purpose of caring
for such child for a period immediately following such birth or
placement, will receive credit for the Hours of Service which otherwise
would have been credited to the Participant but for such absence. The
Hours of Service credited under this paragraph will be credited in the
Plan Year in which the absence begins if such crediting is necessary to
prevent a One Year Break-in-Service in such Plan Year; otherwise, such
Hours of Service will be credited in the following Plan Year. The Hours
of Service credited under this paragraph are those which would normally
have been credited but for such absence; in any case in which the Plan
Administrator is unable to determine such hours normally credited, 8
1-7
Hours of Service per day will be credited. No more than 501 Hours of
Service will be credited under this paragraph for any 12-month period.
The Date of Severance is the second anniversary of the date on which the
absence begins. The period between the initial date of absence and the
first anniversary of the initial date of absence is deemed to be a
period of Service. The period between the first and second
anniversaries of the initial date of absence is neither a period of
service nor a period of severance.
1.17 Integration Level
A Participant's monthly Integration Level is equal to his monthly
Average Social Security Wage Base. Average Social Security Wage Base
means the average (without indexing) of the social security taxable wage
bases in effect for each calendar year during the 35-year period ending
with the calendar year in which the Participant attains (or will attain)
social security retirement age (as defined in Code Section 415(b)). In
determining a Participant's Average Social Security Wage Base, the
taxable wage base for the current and any subsequent Plan Year will be
assumed to be equal to the taxable wage base in effect as of the first
day of the Plan Year for which the determination is being made. No
increase in a Participant's Average Social Security Wage Base will
decrease the Participant's Accrued Benefit.
1.18 Leave of Absence
An authorized Leave of Absence means a period of time of one year or
less granted to an Employee by the Employer due to illness, injury,
temporary reduction in work force, or other appropriate cause or due to
military service during which the Employee's reemployment rights are
protected by law, provided the Employee returns to the service of the
Employer on or before the expiration of such leave, or in the case of
military service, within the time his reemployment rights are so
protected or within 60 days of his discharge from military service if no
federal law is applicable. All authorized Leaves of Absence are granted
or denied by the Employer in a uniform and nondiscriminatory manner,
treating Employees in similar circumstances in a like manner.
If the Participant does not return to active service with the Employer
on or prior to the expiration of his authorized Leave of Absence he will
be considered to have had a Date of Severance as of the earlier of the
date on which his authorized Leave of Absence expired, the first
anniversary of the last date he worked at least one hour as an Active
Participant, or the date on which he resigned or was discharged.
1.19 Limitation Year
The Limitation Year is the 12 month period beginning June 1 and ending
May 31.
1.20 Reserved
1.21 Normal Retirement Age
A Participant's Normal Retirement Age is his attained age on the date
which he satisfies the following requirements:
(a) Attainment of age 65, and
1-8
(b) Attainment of the fifth anniversary of the Participant's Employment
Commencement Date.
1.22 Normal Retirement Date
A Participant's Normal Retirement Date is the first day of the month
which coincides with or next follows the date on which the Participant
attains Normal Retirement Age.
1.23 One Year Break-in-Service
One Year Break-in-Service means any 365-day period following an
Employee's Date of Severance, as defined in Section 1.42(a), in which
the Employee does not have at least one Hour of Service.
1.24 Optional Benefit Form
Any Optional Benefit Form which is provided under the Plan is described
in Section 3.07.
1.25 Participant
The term Participant means an Employee or former Employee who is
eligible to participate in this Plan and who is or who may become
eligible to receive a benefit of any type from this Plan or whose
Beneficiary may be eligible to receive any such benefit.
(a) Active Participant means a Participant who is currently an
Employee.
(b) Disabled Participant means a Participant who has terminated his
employment with the Employer and who is entitled to a Disability
Retirement Benefit under the Plan.
(c) Retired Participant means a Participant who has terminated his
employment with the Employer after meeting the requirements for a
Normal, Early or Late Retirement Benefit and who is receiving such
benefits.
(d) Vested Terminated Participant means a Participant who has terminated
his employment with the Employer and who has a nonforfeitable
right to all or a portion of his or her Accrued Benefit and who
has not received a distribution of the value of his or her Vested
Accrued Benefit.
(e) Former Participant means a Participant who has terminated his
employment with the Employer and who currently has no nonforfeitable
right to any portion of his or her Accrued Benefit.
1.26 Reserved
1.27 Reserved
1.28 Plan, Plan and Trust, Trust
The terms Plan, Plan and Trust and Trust mean Triton Energy Corporation
Retirement Income Plan. The Plan Identification Number is 005.
1-9
The term Predecessor Plan means any qualified plan previously
established and maintained by the Employer and to which this Plan is the
successor.
1.29 Plan Administrator
The Plan Administrator is the Plan Committee.
1.30 Plan Year
The Plan Year is the 12 month period beginning June 1 and ending May
31.
1.31 Reserved
1.32 Qualified Annuity Definitions
(a) Annuity Starting Date
Annuity Starting Date means (i) the first day of the first period
for which an amount is payable as an annuity, or (ii) in the case of
a benefit not payable in the form of an annuity, the first day on
which all events have occurred which entitled the Participant to the
benefit.
(b) Earliest Retirement Age
The Earliest Retirement Age under this Plan is the earliest age at
which a Participant could terminate his employment and receive a
distribution. Death and retirement of a Participant are both
treated as a termination of employment. If a Participant terminates
his employment before the Earliest Retirement Age, only his actual
years of service at the time of his termination of employment are
taken into account.
(c) Qualified Election
(1) In General
Qualified Election means a written waiver of a Qualified Joint
and Survivor Annuity or a Qualified Survivor Annuity. The
waiver must be consented to by the Participant's spouse with
such consent witnessed by a representative of the Plan
Administrator or a notary public. The spouse's consent must
include the designation of a specific Beneficiary and the form
of payment which cannot be changed without the consent of the
spouse. Such consent will not be required if the Participant
establishes to the satisfaction of the Plan Administrator that
such written consent may not be obtained because there is no
spouse, the spouse cannot be located or other circumstances that
may be prescribed by Treasury Regulations. Any consent which is
required under this Section will be valid only with respect to
the spouse who signs the consent (or in the event of a deemed
Qualified Election, the designated spouse). Additionally, a
revocation of a prior waiver may be made by a Participant
without the consent of the spouse at any time before the
commencement of benefits; however, any waiver of a Qualified
Joint and Survivor Annuity or a Qualified Survivor Annuity which
follows such revocation must be in writing and must be consented
1-10
to by the Participant's spouse in the manner described above.
The number of waivers or revocations of such waivers will not be
limited.
(2) Qualified Joint and Survivor Annuity Notices
With respect to any married Participant who does not die before
his Annuity Starting Date, within the 90-day period which ends
on a married Participant's Annuity Starting Date, the Plan
Administrator will provide the Participant with a written
explanation of:
o the terms and conditions of a Qualified Joint and Survivor
Annuity;
o the Participant's right to make and the effect of a
Qualified Election to waive the Qualified Joint and
Survivor Annuity form of benefit;
o a general description of the eligibility conditions and
other material features of the optional forms of benefit
and sufficient additional information to explain the
relative values of the optional forms of benefit
available;
o the rights of the Participant's spouse; and
o the right to make, and the effect of, a revocation of a
previous Qualified Election to waive the Qualified Joint
and Survivor Annuity.
(3) Qualified Survivor Annuity Notices
The election period to waive the Qualified Survivor Annuity will
begin on the first day of the Plan Year in which the Participant
attains age 35 and end on the date of the Participant's death.
If a Vested Terminated Participant separates from service before
the beginning of the election period, the election period will
begin on the date of separation from service.
The Plan Administrator will, within the applicable notice
period, provide each Participant a written explanation of the
Qualified Survivor Annuity containing comparable information to
that required under the provisions of Section 1.32(c)(2). For
purposes of this paragraph, the term "applicable notice period"
means whichever of the following periods ends last:
o the period beginning with the first day of the Plan Year
in which the Participant attains age 32 and ending with
the close of the Plan Year preceding the Plan Year in
which the Participant attains age 35;
o 12 months after the individual becomes a Participant;
o 12 months after the Qualified Survivor Annuity ceases to
be a fully subsidized benefit;
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o 12 months after the joint and survivor rules become
effective for the Participant; or
o 12 months after the Participant separates from service
before attaining age 35.
(d) Qualified Joint and Survivor Annuity
A Qualified Joint and Survivor Annuity means an immediate annuity
which is payable for the life of the Participant with a survivor
annuity for the life of his Surviving Spouse in an amount which is
50% of the amount payable during the joint lives of the Participant
and his spouse. The amount of the Qualified Joint and Survivor
Annuity will be the actuarial equivalent of the Normal Benefit
Form. A Participant may elect, without the consent of his Spouse,
to receive any other actuarially equivalent annuity which is payable
for the life of the Participant with a survivor annuity for the life
of his Surviving Spouse in an amount which is not less than 50% nor
more than 100% of the amount payable during the joint lives of the
Participant and his spouse, but only if such benefit is an Optional
Form of Benefit provided in Section 3.07.
(e) Qualified Life Annuity
A Qualified Life Annuity means an immediate annuity which is payable
for the lifetime of the Participant with payments terminating upon
the death of the Participant.
(f) Qualified Survivor Annuity
Qualified Survivor Annuity means the monthly benefit payable for the
remaining lifetime of a Surviving Spouse to which the Surviving
Spouse is entitled under Section 4.01. The amount of the Qualified
Survivor Annuity benefit will be the larger of the monthly benefit
provided for in Section 4.01 or the monthly benefit calculated under
this Section.
If a Participant dies on or after his Earliest Retirement Age, the
monthly Qualified Survivor Annuity benefit will be equal to 100% of
the monthly benefit which would have been paid to the Participant
and his Surviving Spouse if he had elected to retire on the day
preceding his date of death and to receive his retirement benefit as
a Qualified Joint and Survivor Annuity with 100% payable to the
Surviving Spouse.
If a Participant dies before his Earliest Retirement Age, the
monthly Qualified Survivor Annuity benefit will be deferred until
his Earliest Retirement Age unless the Surviving Spouse elects to
have payment of the Qualified Survivor Annuity begin at a later
date. If the Surviving Spouse does not survive until the
Participant's Earliest Retirement Age (or the deferred date for
beginning payments if elected), the Qualified Survivor Annuity will
be forfeited. The monthly Qualified Survivor Annuity benefit will
be computed as if the Participant had:
(1) separated from service on the earlier of date of death or the
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actual date of separation from service;
(2) survived to his Earliest Retirement Age;
(3) elected to retire on his Earliest Retirement Age and to receive
his retirement benefit as a Qualified Joint and Survivor Annuity
with 100% payable to the Surviving Spouse; and
(4) died on the date after his Earliest Retirement Age.
The Surviving Spouse may elect to receive the Actuarial Equivalent
of the Qualified Survivor Annuity in any Optional Benefit Form which
is available under Section 3.07.
However, notwithstanding anything to the contrary, if the lump sum
value of a Surviving Spouse's Qualified Survivor Annuity is $3,500
or less, the Plan Administrator will direct the immediate
distribution of the value of the Qualified Survivor Annuity to the
Surviving Spouse. If the lump sum value of a Surviving Spouse's
Qualified Survivor Annuity at the time of any distribution exceeds
$3,500, the lump sum value at any later time will be deemed to
exceed $3,500.
1.33 Related Employer
The terms Related Employer and Affiliated Employer are used
interchangeably and mean any other corporation, association, company or
entity on or after the Effective Date which is, along with the Employer,
a member of a controlled group of corporations (as defined in Code
Section 414(b)), a group of trades or businesses which are under common
control (as defined in Code Section 414(c)), an affiliated service group
(as defined in Code Section 414(m)), or any organization or arrangement
required to be aggregated with the Employer by Treasury Regulations
issued under Code Section 414(o).
1.34 Required Beginning Date
A Participant's Required Beginning Date for the commencement of benefit
payments from the Plan is the April 1 immediately following:
o the later of 1989 or the calendar year in which he attained age
70-1/2 if he attained age 70-1/2 after December 31, 1987;
o the calendar year in which he attains age 70-1/2 if he is or was a
Five Percent Owner at any time during the Plan Year ending with or
within the calendar year in which he attains age 66-1/2 or any later
Plan Year; or
o the later of the calendar year in which he attains age 70-1/2 or the
calendar year in which he retires for any other Participant.
1.35 Surviving Spouse
Surviving Spouse means a deceased Participant's spouse who was married
to the Participant on the earlier of the Annuity Starting Date or the
Participant's date of death. The Plan Administrator and the Trustee may
rely conclusively on a Participant's written statement of his marital
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status. Neither the Plan Administrator nor the Trustee is required at
any time to inquire into the validity of any marriage, the effectiveness
of a common-law relationship or the claim of any alleged spouse which is
inconsistent with the Participant's report of his marital status and the
identity of his spouse.
Wherever the consent of the Participant's spouse is required, it will be
valid only if it is in writing, acknowledges the effect of the consent,
and is witnessed by a notary public, the Plan administrator or the duly
appointed representative of the Plan Administrator. The consent will
not be required if the Participant establishes to the satisfaction of
the Plan Administrator that written consent cannot be obtained because
there is no spouse, the spouse cannot be located, or other circumstances
prescribed by Treasury Regulation Section 1.401(a)-20 Q&A 27. Any
consent necessary under this provision will be valid only with respect
to the spouse who signs the consent.
1.36 Top-Heavy Definitions
(a) Aggregate Account
Aggregate Account means, with respect to each Participant, the value
of all accounts maintained on behalf of the Participant, whether
attributable to Employer or Employee contributions, used to
determine Top-Heavy Plan status under the provisions of a defined
contribution plan. A Participant's Aggregate Account as of the
Determination Date will be the sum of:
o the balance of his Account(s) as of the most recent valuation
date occurring within a 12-month period ending on the
Determination Date (excluding any amounts attributable to
deductible voluntary employee contributions); plus
o contributions that would be allocated as of a date not later
than the Determination Date, even though those amounts are not
yet made or required to be made; plus
o any Plan Distributions made within the Plan Year that includes
the Determination Date or within the four preceding Plan Years.
(b) Aggregation Group
Aggregation Group means either a Required Aggregation Group or a
Permissive Aggregation Group as hereinafter determined.
(1) Required Aggregation Group
Each plan of the Employer in which a Key Employee is a
Participant, and each other plan of the Employer which enables
any plan in which a Key Employee participates to meet the
requirements of Code Section 401(a)(4) or 410, will be
aggregated and the resulting group will be known as a Required
Aggregation Group.
Each plan in the Required Aggregation Group will be considered a
Top-Heavy Plan if the Required Aggregation Group is a Top-Heavy
Group. No plan in the Required Aggregation Group will be
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considered a Top-Heavy Plan if the Required Aggregation Group is
not a Top-Heavy Group.
(2) Permissive Aggregation Group
The Employer may also include any other plan not required to be
included in the Required Aggregation Group, provided the
resulting group (to be known as a Permissive Aggregation Group),
taken as a whole, would continue to satisfy the provisions of
Code Sections 401(a)(4) and 410.
Only a plan that is part of the Required Aggregation Group will
be considered a Top-Heavy Plan if the Permissive Aggregation
Group is a Top-Heavy Group. No plan in the Permissive
Aggregation Group will be considered a Top-Heavy Plan if the
Permissive Aggregation Group is not a Top-Heavy Group.
Only those plans of the Employer in which the Determination
Dates fall within the same calendar year will be aggregated in
order to determine whether the plans are Top-Heavy Plans.
(c) Determination Date
Determination Date means the last day of the preceding Plan Year,
or, in the case of the first Plan Year, the last day of the first
Plan Year.
(d) Key Employee
Key Employee means any Employee or former Employee (and his
Beneficiary) who, at any time during the Plan Year or any of the
preceding four Plan Years, was:
(1) A "Five Percent Owner" of the Employer. "Five Percent Owner"
means any person who owns (or is considered as owning within the
meaning of Code Section 318) more than 5% of the value of the
outstanding stock of the Employer or stock possessing more than
5% of the total combined voting power of all stock of the
Employer. If the Employer is not a corporation, Five Percent
Owner means any person who owns more than 5% of the capital or
profits interest in the Employer. In determining percentage
ownership hereunder, Related Employers will be treated as
separate Employers; or
(2) A "One Percent Owner" of the Employer having Compensation from
the Employer of more than $150,000. "One Percent Owner" means
any person who owns (or is considered as owning within the
meaning of Code Section 318) more than 1% of the value of the
outstanding stock of the Employer or stock possessing more than
1% of the total combined voting power of all stock of the
Employer. If the Employer is not a corporation, One Percent
Owner means any person who owns more than 1% of the capital or
profits interest in the Employer. In determining percentage
ownership hereunder, Related Employers will be treated as
separate Employers. However, in determining whether an
individual has Compensation of more than $150,000, Compensation
from each Related Employer will be taken into account; or
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(3) One of the 10 Employees having Compensation not less than the
Defined Contribution Dollar Limit (as defined in Section 7.03(j)
for the Plan Year) who owns (or is considered as owning within
the meaning of Code Section 318) both greater than 1/2% interest
and the largest interests in all Employers required to be
aggregated under Code Sections 414(b), (c), (m) and (o); or
(4) An officer (within the meaning of the regulations under Code
Section 416) of the Employer having Compensation greater than
50% of the Defined Benefit Dollar Limit as defined in Section
7.03(f) for the Plan Year.
For purposes of this Section, Compensation means Aggregate
Compensation as defined in Section 7.03(a) plus any amounts
contributed by the Employer pursuant to a salary reduction agreement
which are excludible from the gross income of the Employee under
Code Section 125, 402(a)(8), 402(h) or 403(b). Compensation in
excess of $200,000 (as adjusted by the Secretary of the Treasury
under Code Section 415(d)) will be disregarded.
(e) Non-Key Employee
Non-Key Employee means any Employee (and his Beneficiaries) who is
not a Key Employee.
(f) Plan Distributions
Plan distributions include distributions made before January 1,
1984, and distributions under a terminated plan which, if it had not
been terminated, would have been required to be included in an
aggregation group. However, distributions made after the Valuation
Date and before the Determination Date are not included to the
extent that they are already included in the Participant's Single
Sum Benefit as of the Valuation Date.
With respect to "unrelated" rollovers and plan-to-plan transfers
(those which are both initiated by an employee and made from a plan
maintained by one employer to a plan maintained by another
employer), if such a rollover or plan-to-plan transfer is made from
this Plan, it will be considered as a distribution for purposes of
this Section. If such a rollover or plan-to-plan transfer is made
to this Plan, it will not be considered as part of the Participant's
Single Sum Benefit. However, an unrelated rollover or plan-to-plan
transfer accepted before January 1, 1984, will be considered as part
of the Participant's Single Sum Benefit.
With respect to "related" rollovers and plan-to-plan transfers
(those which are either not initiated by an employee or are made
from one plan to another plan maintained by the same employer), if
such a rollover or plan-to-plan transfer is made from this Plan, it
will not be considered as a distribution for purposes of this
Section. If such a rollover or plan-to-plan transfer is made to
this Plan, it will be considered as part of the Participant's Single
Sum Benefit.
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(g) Present Value of Accrued Benefit
In the case of the defined benefit plan, a Participant's Present
Value of Accrued Benefit, for Top-Heavy determination purposes, will
be determined using the following rules:
(1) The Present Value of Accrued Benefit will be determined as of
the most recent "Valuation Date" within a 12-month period ending
on the Determination Date.
(2) For the first Plan Year, the Present Value of Accrued Benefit
will be determined as if (A) the Participant terminated service
as of the Determination Date; or (B) the Participant terminated
service as of the Valuation Date, but taking into account the
estimated Present Value of Accrued Benefits as of the
Determination Date.
(3) For any other Plan Year, the Present Value of Accrued Benefit
will be determined as if the Participant terminated service as
of the Valuation Date.
(4) The Valuation Date must be the same date used for computing the
defined benefit plan minimum funding costs, regardless of
whether a calculation is performed that plan year.
(5) A Participant's Present Value of Accrued Benefit as of a
Determination Date will be the sum of:
o the present value of his Accrued Benefit determined using
the actuarial assumptions which are specified below; plus
o any Plan Distributions made within the Plan Year that
includes the Determination Date or within the four preceding
Plan Years; plus
o any employee contributions, whether voluntary or mandatory.
However, amounts attributable to qualified voluntary
employee contributions, as defined in Code Section 219(e)(2)
will not be considered to be a part of the Participant's
Present Value of Accrued Benefit.
For purposes of this Section, the present value of a
Participant's Accrued Benefit will be equal to the greater of
the present value determined using the actuarial assumptions
which are specified for Actuarial Equivalent purposes or the
present value determined using the "Applicable Interest Rate."
The Applicable Interest Rate is the rate or rates that would be
used by the Pension Benefit Guaranty Corporation for a trusteed
single-employer plan to value a Participant's or Beneficiary's
benefit on the date of distribution (the "PBGC Rate"). If the
present value using the PBGC Rate exceeds $25,000, the
Applicable Interest Rate is 120% of the PBGC Rate. However, the
use of 120% of the PBGC Rate will never result in a present
value less than $25,000.
1-17
(6) Solely for the purpose of determining if this Plan (or any other
plan included in a Required Aggregation Group of which this Plan
is a part) is Top- Heavy, the Accrued Benefit of any Employee
other than a Key Employee will be determined under
(A) the method, if any, that uniformly applies for accrual
purposes under all plans maintained by the Employer or any
Related Employer, or
(B) if there is no such method, as if the benefit accrued no
more rapidly than the slowest accrual rate permitted under
the fractional accrual rate of Code Section 411(b)(1)(C).
(h) Single Sum Benefit
The Single Sum Benefit for any Participant in a defined benefit
pension plan will be equal to his Present Value of Accrued Benefit.
The Single Sum Benefit for any Participant in a defined contribution
plan will be equal to his Aggregate Account.
(i) Top-Heavy Group
Top-Heavy Group means an Aggregation Group in which, as of the
Determination Date, the Single Sum Benefits of all Key Employees
under all plans included in the group exceeds 60% of a similar sum
determined for all Participants.
Super Top-Heavy Group means an Aggregation Group in which, as of the
Determination Date, the sum of (1) the Single Sum Benefits of all
Key Employees under all defined benefit plans included in the group,
plus (2) the Single Sum Benefit of all Key Employees under all
defined contribution plans included in the group exceeds 90% of a
similar sum determined for all Participants.
(j) Top-Heavy Plan
This Plan will be a Top-Heavy Plan for any Plan Year beginning after
December 31, 1983, in which, as of the Determination Date, the
Single Sum Benefits of all Key Employees exceed 60% of the Single
Sum Benefits of all Participants under this Plan.
This Plan will be a Super Top-Heavy Plan for any Plan Year beginning
after December 31, 1983, in which, as of the Determination Date, the
Single Sum Benefits of all Key Employees exceed 90% of the Single
Sum Benefits of all Participants under this Plan.
If any Participant is a Non-Key Employee for a given Plan Year, but
was a Key Employee for any prior Plan Year, the Participant's Single
Sum Benefit will not be taken into account for purposes of
determining whether this Plan is a Top-Heavy or Super Top-Heavy Plan
(or whether any Aggregation Group which includes this Plan is a
Top-Heavy or Super Top-Heavy Group).
If an individual has performed no services for the Employer at any
time during the 5-year period ending on the Determination Date, any
Single Sum Benefit of such individual will not be taken into account
for purposes of determining whether this Plan is a Top-Heavy or
1-18
Super Top-Heavy Plan (or whether any Aggregation Group which
includes this Plan is a Top-Heavy Group or Super Top-Heavy Group).
1.37 Trust Fund, Trust
These terms mean the total cash, securities, real property, insurance
contracts and any other property held by the Trustee.
1.38 Trustee
The Trustee is Smith Barney Shearson Trust Company or any successor Trus
tee.
1.39 Vested Accrued Benefit
A Participant's Vested Accrued Benefit as of a given date will be equal
to the product of his Accrued Benefit multiplied by his Vested
Percentage as of that same date.
A Participant's Vested Percentage as of a given date will be that
percentage determined in accordance with the Vesting Schedule.
Notwithstanding the preceding, an Active Participant will be 100% vested
upon reaching the earlier of (a) his Normal Retirement Age or (b) the
later of the date upon which the Participant attains age 65 or reaches
the 5th anniversary of the date he commenced participation in the Plan.
1.40 Vesting Schedule
A Participant's Vested Percentage will be 100% upon the completion of 5
Years of Vesting Service. Prior to the completion of 5 Years of Vesting
Service, a Participant's Vested Percentage is zero.
Notwithstanding the foregoing, in any Plan Year in which the Plan is
determined to be a Top-Heavy Plan, the following Vesting Schedule will
apply in lieu of the Vesting Schedule provided for above:
Years of Vesting Service Vested Percentage
----------------------------- -----------------
Less than 2 Years 0%
2 Years 20%
3 Years 40%
4 Years 60%
5 Years 80%
6 Years or more 100%
If in any subsequent Plan Year the Plan ceases to be a Top-Heavy Plan,
the above Vesting Schedule will continue to apply unless the Employer
elects, by Written Resolution, to resume the Vesting Schedule specified
at the beginning of this Section. Any such resolution will be treated
as a Plan Amendment and be subject to the restrictions contained in
Section 10.06.
Notwithstanding the foregoing, a Participant's Vested Percentage will be
100% if a "Change in Control" of Triton Energy Corporation occurs. For
purposes of this Section, Change in Control means the occurrence of any
of the following events:
(a) The consummation of (i) any consolidation or merger of the Employer
1-19
in which the Employer is not the continuing or surviving corporation
or pursuant to which shares of the Employer's common stock would be
converted into cash, securities or other property, other than a
merger of the Employer in which the holders of the Employer's common
stock immediately prior to the merger have the same proportionate
ownership of common stock of the surviving corporation immediately
after the merger, or (ii) any sale, lease, exchange or other
transfer (excluding transfer by way of ledge or hypothecation), in
one transaction or a series of related transactions, of all, or
substantially all, of the assets of the Employer;
(b) The shareholders of the Employer approve any plan or proposal for
the liquidation or dissolution of the Employer;
(c) Any "person" (as such term is defined in Section 3(a)(9) or Section
13(d)(3) under the Securities Exchange Act of 1934) or any "group"
(as such term is used in Rule 13d-5 promulgated under the Securities
Exchange Act of 1934), other than the Employer or any successor of
the Employer or any Subsidiary of the Employer or any employee
benefit plan of the Employer or any subsidiary (including such
plan's trustee), becomes, without the prior approval of the
Directors of the Employer, a beneficial owner for purposes of
Rule13d-3 promulgated under the Securities Exchange Act of 1934,
directly or indirectly, of securities of the Employer representing
25% or more of the Employer's then outstanding securities having the
right to vote in the election of Directors of the Employer; or
(d) During any period of two consecutive years, individuals who, at the
beginning of such period constituted the entire Board of Directors
of the Employer, cease for any reason (other than death) to
constitute a majority of the Directors of the Employer, unless the
election, or the nomination for election, by the Employer's
shareholders, of each new Director of the Employer was approved by a
vote of at least two-thirds of the Directors of the Employer then
still in office who were Directors of the Employer at the beginning
of the period.
1.41 Written Resolution
The terms Written Resolution and Written Consent are used
interchangeably and reflect decisions, authorizations, etc. by the
Employer. A Written Resolution will be evidenced by a resolution of the
Board of Directors of the Employer.
1.42 Year of Service
(a) Crediting Years of Service
Years of Service are determined under the Elapsed Time Method.
Under the Elapsed Time Method, Years of Service are based upon an
Employee's Elapsed Time of employment irrespective of the number of
hours actually worked during such period; a Year of Service
(including a fraction thereof) will be credited for each completed
365 days of Elapsed Time which need not be consecutive. The
following terms are used in determining Years of Service under the
Elapsed Time Method:
1-20
(1) Date of Severance (Termination) - means the earlier of (A) the
actual date an Employee resigns, is discharged, dies or retires,
or (B) the first anniversary of the date an Employee is absent
from work (with or without pay) for any other reason, e.g.,
disability, vacation, leave of absence, layoff, etc.
Notwithstanding the above, Date of Severance will mean the date
specifically designated as such in any severance of employment
agreement.
(2) Elapsed Time - means the total period of service which has
elapsed between a Participant's Employment Commencement Date and
Date of Termination including Periods of Severance where a One
Year Break-in-Service does not occur.
(3) Employment Commencement Date - means the date an Employee first
performs one Hour of Service for the Employer.
(4) One Year Break-in-Service - means any 12-month period following
an Employee's Date of Termination as defined above in which the
Employee does not have at least one Hour of Service.
(5) Period of Severance - is the time between the actual Date of
Severance as defined above and the subsequent date, if any, on
which the Employee performs an Hour of Service.
All periods of employment will be aggregated including Periods of
Severance unless there is a One Year Break-in-Service.
Years of Eligibility Service for purposes of determining eligibility
to participate in the Plan and Years of Vesting Service for purposes
of determining a Participant's Vested Percentage include service
with any organization which is a Related Employer with respect to
the Employer.
(b) For Benefit Purposes
Years of Service for purposes of computing a Participant's Normal
Retirement Benefit are referred to as Years of Benefit Service and
are determined using the Elapsed Time Method.
All of a Participant's Years of Benefit Service are taken into
account in determining his Normal Retirement Benefit except:
o Service while the Employee declined participation in this Plan
or any Predecessor Plan;
o Service while the Employee was not in an Eligible Employee
Classification;
o Service while the Employee was an employee of a Related Employer
which is not an Employer or a Participating Employer under this
Plan; and
1-21
o Service for which the Employee was not entitled to receive
Compensation.
(c) For Vesting Purposes
Years of Service for purposes of computing a Participant's Vested
Percentage are referred to as Years of Vesting Service and are
determined using the Elapsed Time Method.
All of a Participant's Years of Vesting Service are taken into
account in determining his Vested Percentage.
1-22
ARTICLE 2
PARTICIPATION
2.01 Participation
An Employee who is a member of an Eligible Employee Classification will
become a Participant in the Plan on the Entry Date which coincides with
or next follows his or her Employment Commencement Date.
An Employee who is eligible to participate as of the Effective Date or
as of a given Entry Date will automatically become a Participant as of
such date. An Employee who is otherwise eligible to participate may
irrevocably elect not to participate in the Plan. Any election under
this paragraph must be in writing and according to guidelines
established by the Plan Administrator.
2.02 Participation After Reemployment
An Employee who terminates employment prior to his Entry Date will
participate in the Plan immediately upon returning to the employ of the
Employer.
A Participant or Former Participant who has terminated employment will
participate as an Active Participant in the Plan immediately upon
returning to the employ of the Employer.
2.03 Change in Employment Classification
If a Participant becomes ineligible to participate because he is no
longer a member of an Eligible Employee Classification, the Participant
will participate immediately upon his return to an Eligible Employee
Classification.
If an Employee who is not a member of an Eligible Employee
Classification becomes a member of such a classification, the Employee
will begin to participate immediately if he has satisfied the
eligibility requirements which are specified in Section 2.01.
2-1
ARTICLE 3
RETIREMENT BENEFITS
3.01 Normal Retirement
When an Active Participant reaches his Normal Retirement Date, he may
elect to retire and he will begin to receive the Normal Retirement
Benefit to which he is entitled hereunder. Upon attainment of his
Normal Retirement Age, an Active Participant's Normal Retirement Benefit
will become nonforfeitable. The form of benefit payment will be
governed by the provisions of Section 3.06.
(a) Normal Retirement Benefit
With respect to any Participant who completes at least one Hour of
Service on or after June 1, 1993, the Participant's Normal
Retirement Benefit is the monthly pension benefit commencing on his
Normal Retirement Date payable in the Normal Benefit Form in an
amount equal to:
0.8% of his Average Monthly Compensation plus 0.65%
of his Excess Average Monthly Compensation, each
multiplied by his Years of Benefit Service not to
exceed 30 years.
Effective for the period from June 1, 1989 through May 31, 1993, the Normal
Retirement Benefit for any Participant who completed at least one Hour of
Service on or after June 1, 1993 and before May 31, 1993 is the monthly
pension benefit commencing on his Normal Retirement Date payable in the Normal
Benefit Form in an amount equal to:
0.4% of his Average Monthly Compensation plus 0.4%
of his Excess Average Monthly Compensation, each
multiplied by his Years of Benefit Service not to
exceed 30 years.
(b) Normal Benefit Form
Lifetime Pension - Monthly pension benefit payable for the lifetime
of the Participant with payments terminating upon the death of the
Participant.
3.02 Early Retirement
The form of payment of a Participant's Early Retirement Benefit will be
governed by the provisions of Section 3.06.
(a) Early Retirement Date
A Participant's Early Retirement Date is the date which is so
elected by the Participant for the commencement of monthly pension
benefits prior to his Normal Retirement Date. A Participant may
select an Early Retirement Date as the first day of the month which
coincides with or next follows the date upon which he satisfies the
following requirements:
(1) Attainment of age 55; and
3-1
(2) Completion of 5 Years of Vesting Service.
(b) Early Retirement Benefit
A Participant's Early Retirement Benefit is equal to the Actuarial
Equivalent of his Accrued Benefit determined as of his Early
Retirement Date.
3.03 Late Retirement
If a Participant continues as an Employee or is re-employed after his
Normal Retirement Date, payment of his benefit will be withheld until
his Late Retirement Date, which is the earlier of the following:
o the date the Participant retires or resumes retirement; or
o the Participant's Required Beginning Date.
As of his Late Retirement Date, a Participant will begin to receive his
Late Retirement Benefit which will be equal to the greater of the
following:
o the amount which can be provided by the Actuarial Equivalent of the
single sum value of his Normal Retirement Benefit determined as of
his Normal Retirement Date and accumulated with Actuarial Equivalent
interest from his Normal Retirement Date to his Late Retirement
Date, reduced (but not below zero) by the Actuarial Equivalent
(interest only) of any earlier benefit payments; or
o the amount which is based on the Normal Retirement Benefit formula
using his Years of Benefit Service and Compensation through his Late
Retirement Date, reduced (but not below zero) by the Actuarial
Equivalent (interest only) of any earlier benefit payments.
If a Participant continues as an Employee or is re-employed after the
end of the calendar year immediately preceding his Required Beginning
Date, his benefit will be payable as required by Section 3.08 of this
Plan. As of each later January 1st that the Participant continues to be
employed, and upon his later termination of employment, the amount of
his Late Retirement Benefit will be recomputed in accordance with the
formula described above.
3.04 Disability Retirement
(a) Disability Retirement Date
A Participant's Disability Retirement Date is the first day of the
month coincident with or next following the date of termination of
his employment due to disability provided the Participant has been
found to be eligible for a Disability Retirement Benefit.
An Active Participant will be eligible for a Disability Retirement
Benefit under the Plan upon the occurrence of Permanent Disability
coincident with or following the Participant's completion of 2 Years
of Benefit Service.
3-2
(b) Disability Retirement Benefit
An eligible Participant's Disability Retirement Benefit is equal to
the Normal Retirement Benefit to which the Participant would have
been entitled if he had continued to be an Employee until his Normal
Retirement Date with such benefit calculated on the basis of his
Average Monthly Compensation determined as of his Disability
Retirement Date. Such benefit will begin on his Normal Retirement
Date. Such Disability Retirement Benefit is nonforfeitable except
by reason of death or recovery from disability.
Notwithstanding the above, if a Participant satisfies the
requirements for a Disability Retirement Benefit and, in accordance
with the provisions of Section 5.02, also satisfies the requirements
for a Vested Accrued Benefit, the portion of his Disability
Retirement Benefit which is the Actuarial Equivalent of his Vested
Accrued Benefit will be payable in a form which is subject to the
provisions of Section 3.06. The remaining portion, if any, of the
Actuarial Equivalent of the Participant's Disability Retirement
Benefit will be payable as a Lifetime Pension with a monthly benefit
payable for the Participant's lifetime with payments terminating
upon his death.
(c) Permanent Disability
A Participant will be considered permanently disabled if, in the
opinion of the Plan Administrator,
(1) he is prevented from performing each of the material duties
of any occupation for which he is reasonably suited based on
education and experience;
(2) such disability is likely to be both continuous and
permanent;
(3) such disability occurs on or after the Effective Date of the
Plan but prior to the Participant's Normal Retirement Date;
and
(4) such disability is not the result of injury or disease
sustained by the Participant subsequent to the date his
employment terminated.
(d) Proof of Disability
The Plan Administrator, before approving the payment of a Disability
Retirement Benefit, may require satisfactory proof, in the form of a
certificate from a duly licensed physician selected or approved by
the Plan Administrator, that the Participant has become permanently
disabled as provided herein. Periodically, after the commencement
of the Disability Retirement Benefit, the Plan Administrator may
similarly require proof of the continued disability of the
Participant.
(e) Recovery from Disability
If the Plan Administrator finds that a Disabled Participant is, at
any time prior to his eligibility for Early Retirement, no longer
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disabled as provided herein, the Disabled Participant's right to a
Disability Retirement Benefit will terminate as of the date that the
Plan Administrator determines that he has recovered from
disability.
(1) Disabled Participant Reemployed - If the Disabled Participant is
reemployed by the Employer upon his recovery from disability, he
will immediately become an Active Participant in the Plan upon
his return to employment. All Service earned prior to the date
of his termination of employment due to disability will be
restored in full. In addition, he will also receive Service
credit for the period beginning on his date of termination of
employment due to disability and ending on the date he is
reemployed by the Employer. However, any benefit to which he
later becomes entitled under the Plan will be reduced on an
Actuarially Equivalent basis in recognition of any Disability
Retirement Benefit which he may have received under the Plan.
(2) Participant Not Reemployed - If the Participant is not
reemployed by the Employer upon his recovery from disability and
if he had a Vested Accrued Benefit as of his date of termination
of employment due to disability, he will be entitled to the
benefits described in Article 5. However, such benefits will be
reduced on an Actuarially Equivalent basis in recognition of any
Disability Retirement Benefit which he may have received under
the Plan.
3.05 Miscellaneous
The provisions contained in this Article 3 must meet the requirements of
Code Section 401(l) and all regulations issued thereunder. If either
the annual or the cumulative overall permitted disparity limit as
defined in Treasury Regulation 1.401(l)-5 would otherwise be exceeded at
any time, then the benefit otherwise payable to a Participant under this
Plan will be limited to the extent necessary to prevent such limits from
being exceeded.
Any changes in the Social Security Act after the date of a Participant's
termination of employment will not affect his benefit under this Plan.
3.06 Form of Benefit Payment
The Plan Administrator will direct the Trustee to make the payment of
any benefit provided under this Plan upon the event giving rise to such
benefit within the time prescribed by this Article. The form of benefit
will be determined as follows:
(a) a Participant who is not married on his Annuity Starting Date will
be provided a Qualified Life Annuity unless he elects the Normal
Benefit Form or an Optional Benefit Form in writing within the
90-day period which ends on his Annuity Starting Date. The
Qualified Life Annuity will be the Actuarial Equivalent of the
Normal Benefit Form.
(b) a Participant who is married on his Annuity Starting Date will be
provided a Qualified Joint and Survivor Annuity unless he makes a
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Qualified Election to receive an Optional Benefit Form or the Normal
Benefit Form. The Qualified Joint and Survivor Annuity will be the
Actuarial Equivalent of the Normal Benefit Form.
However, notwithstanding anything to the contrary, if the present value
of a Participant's Vested Accrued Benefit does not exceed $3,500, the
Plan Administrator will direct the immediate distribution of the present
value of the Vested Accrued Benefit to the Participant. This paragraph
will not apply after the Annuity Starting Date.
3.07 Optional Benefit Forms
Optional forms of benefit distribution are available subject to a
written request by the Participant (or, upon the Participant's death,
the Participant's Surviving Spouse or Beneficiary). The Optional
Benefit Forms are available and equal to the Actuarial Equivalent of the
Normal Benefit Form and may be in an amount more than or less than that
provided by the Normal Benefit Form depending on the option selected.
Such distribution may be in one or more of the following forms:
o Joint & 50% Contingent Survivor Pension - monthly pension
benefit payable during the joint lifetime of the Participan
t and
the Joint Annuitant; reduces to 50% of the original amount
upon the death of the Participant.
o Joint & 75% Contingent Survivor Pension - monthly pension
benefit payable during the joint lifetime of the Participan
t and
the Joint Annuitant; reduces to 75% of the original amount
upon the death of the Participant.
o Joint & Survivor Pension - monthly pension benefit payable
for as long as either the Participant or the Joint Annuitan
t
is alive.
In the case of an Optional Benefit Form that is not payable as a level
annuity over a period of at least the Participant's lifetime, the
Optional Benefit Form must satisfy the maximum permitted disparity
requirement of Treasury Regulation 1.401(l)-3(b)(4)(iii)(C).
If the Participant's entire interest is to be distributed in other than
a lump-sum or a life annuity (with or without a period certain), then
the amount to be distributed each year must be at least an amount equal
to the quotient obtained by dividing the Participant's entire interest
by the life expectancy of the Participant or joint and last survivor
expectancy of the Participant and the Participant's designated
Beneficiary. Life expectancy and joint and last survivor expectancy are
computed by the use of the return multiples contained in Section 1.72-9
of the Income Tax Regulations. For purposes of this computation, a
Participant's life expectancy will be recalculated no more frequently
than annually; however, the life expectancy of a non-spouse Beneficiary
may not be recalculated.
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If the Participant's spouse is not the designated Beneficiary, the
method of distribution selected must comply with the minimum
distribution incidental benefit rule set forth in Section 1.401(a)(9)-2
of the Treasury Regulations.
3.08 Commencement of Benefit
Subject to the provisions of this Article, commencement of a benefit
will, unless the Participant elects otherwise in writing, begin not
later than the 60th day after the later of the close of the Plan Year in
which the Participant attains Normal Retirement Age or the close of the
Plan Year which contains the date the Participant terminates his service
with the Employer.
For purposes of this Section, life expectancy and joint and last
survivor expectancy are to be computed by the use of the return
multiples contained in Section 1.72-9 of the Income Tax Regulations.
Payment of a Participant's benefits must begin no later than his
Required Beginning Date.
If the Participant dies after distribution of his interest has begun,
the remaining portion of the interest will continue to be distributed at
least as rapidly as under the method of distribution being used before
the Participant's death.
All distributions required under this Section will be determined and
made in accordance with the regulations issued under Code Section
401(a)(9), including those dealing with minimum distribution
requirements.
3.09 Directed Transfer of Eligible Rollover Distributions
(a) General
This Section applies to distributions made on or after January 1,
1993. Notwithstanding any provision of the Plan to the contrary
that would otherwise limit a Distributee's election under this
Section, a Distributee may elect, at the time and in the manner
prescribed by the Plan Administrator, to have any portion of an
Eligible Rollover Distribution paid directly to an Eligible
Retirement Plan specified by the Distributee in a Direct Rollover.
(b) Eligible Rollover Distribution
An Eligible Rollover Distribution is any distribution of all or any
portion of the balance to the credit of the Distributee, except that
an Eligible Rollover Distribution does not include: any distribution
that is one of a series of substantially equal periodic payments
(not less frequently than annually) made for the life (or life
expectancy) of the Distributee or the joint lives (or joint life
expectancies) of the Distributee and the Distributee's designated
beneficiary, or for a specified period of ten years or more; any
distribution to the extent such distribution is required under
section 401(a)(9) of the Code; and the portion of any distribution
that is not includible in gross income (determined without regard to
the exclusion for net unrealized appreciation with respect to
3-6
employer securities).
(c) Eligible Retirement Plan
An Eligible Retirement Plan is an individual retirement account
described in section 408(a) of the Code, an individual retirement
annuity described in section 408(b) of the Code, or a qualified
trust described in section 401(a) of the Code, that accepts the
Distributee's Eligible Rollover Distribution. However, in the case
of an Eligible Rollover Distribution to the surviving spouse, an
Eligible Retirement Plan is an individual retirement account or
individual retirement annuity.
(d) Distributee
A Distributee includes an Employee or former Employee. In addition,
the Employee's or former Employee's surviving spouse and the
Employee's or former Employee's spouse or former spouse who is the
alternate payee under a qualified domestic relations order, as
defined in section 414(p) of the Code, are Distributees with regard
to the interest of the spouse or former spouse.
(e) Direct Rollover
A Direct Rollover is a payment by the Plan to the Eligible
Retirement Plan specified by the Distributee.
(f) Waiver of 30-Day Notice
If a distribution is one to which Code Sections 401(a)(11) and 417
do not apply, such distribution may commence less than 30 days after
the notice required under Section 1.411(a)-11(c) of the Income Tax
Regulations is given, provided that:
o the Plan Administrator clearly informs the Participant that the
Participant has a right to a period of at least 30 days after
receiving the notice to consider the decision of whether or not
to elect a distribution (and, if applicable, a particular
distribution option); and
o the Participant, after receiving the notice, affirmatively
elects to receive a distribution.
3-7
ARTICLE 4
DEATH BENEFIT
4.01 Pre-Retirement Death Benefit
A Participant's Surviving Spouse will be entitled to receive a death
benefit if the Participant dies before his Annuity Starting Date.
If the Participant had not otherwise met the age and service
requirements outlined in Section 3.02 with respect to an Early
Retirement Benefit, the Participant's Surviving Spouse, if any, will be
entitled to receive a monthly pension benefit equal to 50% of the
monthly pension benefit which would have been payable had the
Participant retired on the day before his death and elected a Joint and
50% Contingent Survivor Pension as defined in Section 3.07. Such
benefit will commence on the date the Participant would have otherwise
first been eligible to receive an Early Retirement Benefit.
If the Participant had otherwise met the age and service requirements
outlined in Section 3.02 with respect to an Early Retirement Benefit,
the Participant's Surviving Spouse, if any, will be entitled to receive
a monthly pension benefit equal to the monthly pension benefit which
would have been payable had the Participant retired on the day before
his death and elected a Joint and Survivor Pension as defined in Section
3.07.
4.02 Post-Retirement Death Benefit
In the event of the death of a Retired Participant or a Disabled
Participant receiving a benefit, a benefit will be paid to the
Participant's Beneficiary or Surviving Spouse in accordance with the
form of benefit payment elected under the Plan.
4.03 Effect of Death on Benefit Rights
The death of a Participant will result in the forfeiture of all benefits
(other than those described in this Article) to which he would have been
entitled if he had survived.
4-1
ARTICLE 5
TERMINATION OF EMPLOYMENT
5.01 Termination of Employment
If the employment of a Participant terminates for any reason other than
death, disability or retirement, the Participant will become entitled to
receive a Normal Retirement Benefit commencing on his Normal Retirement
Date equal to his Vested Accrued Benefit. If he is entitled to receive
a monthly retirement benefit, he will be considered a Vested Terminated
Participant.
5.02 Payment of Vested Accrued Benefit
The monthly retirement benefit payable to a Vested Terminated
Participant will be subject to the same terms and conditions in respect
to time, manner and form of payment as any other Normal Retirement
Benefit. A Vested Terminated Participant may elect to begin to receive
his Vested Accrued Benefit at any time after he satisfies the
requirements for Early Retirement, in which case his benefit will be in
the same amount and subject to the same terms and conditions as an Early
Retirement Benefit. If the Participant has satisfied the service
requirement but not the age requirement for Early Retirement, he will be
entitled to receive an Early Retirement Benefit upon later satisfaction
of the age requirement.
5.03 Cash-Out Distribution
If the present value of a terminated Participant's Vested Accrued
Benefit does not exceed $3,500, the Plan Administrator will direct the
immediate distribution to the Participant of the present value of his
Vested Accrued Benefit.
If a terminated Participant receives a complete distribution of his
Vested Accrued Benefit, a Cash-Out Distribution will be deemed to have
occurred as of the date of distribution. If a Participant who is zero
percent vested in his Accrued Benefit terminates employment, a Cash-Out
Distribution will be deemed to have occurred as of the Participant's
date of termination of employment.
5.04 Forfeitures
If a Participant, who is less than 100% vested, terminates employment
and either receives a Cash-Out Distribution or incurs five consecutive
One Year Breaks-in-Service, he will forfeit the non-vested portion of
his Accrued Benefit. If the Participant subsequently returns to an
Eligible Employee Classification, he will immediately become completely
reinstated with his previously credited Years of Service.
5.05 Reemployment
If a Participant (a) terminates employment, (b) receives a distribution
of all or a portion of his Vested Accrued Benefit and (c) is later
reemployed, the Participant's Normal Retirement Benefit (and therefore
his Accrued Benefit) will be reduced by the Actuarial Equivalent value
of the benefit which was previously distributed.
5-1
ARTICLE 6
ACCRUED BENEFIT
6.01 Accrued Benefit
A Participant's Accrued Benefit represents the amount of monthly
retirement pension benefit which has been earned as of any given date.
Prior to a Participant's Normal Retirement Date, his Accrued Benefit is
determined in accordance with Section 1.01 and is payable in the Normal
Benefit Form commencing on his Normal Retirement Date. For such
purposes, the Participant's Normal Retirement Benefit will be determined
based on his Average Monthly Compensation at the time his Accrued
Benefit is determined.
A Participant's Accrued Benefit at his Normal Retirement Age will be
equal to his Normal Retirement Benefit. If a Participant continues as
an Employee after his Normal Retirement Date, his Accrued Benefit will
be equal to his Late Retirement Benefit determined in accordance with
Section 3.03.
A Participant's Accrued Benefit will not be reduced on account of any
increase in the Participant's age or service.
6.02 Minimum Benefit Requirement for Top-Heavy Plan
(a) General
For any Plan Year in which this Plan is determined to be Top-Heavy,
a Participant who is a Non-Key Employee (including any Employee who
is excluded from the Plan because his Compensation is less than a
stated amount) will be entitled to a monthly benefit equal to the
greater of the Accrued Benefit provided under Section 1.01 or a
monthly benefit in the form of a straight life annuity (with no
ancillary benefits) commencing at Normal Retirement Date equal to
the product of the Participant's average monthly compensation (which
will mean the average rate of Aggregate Compensation during the 5
consecutive years, as defined for purposes of determining Average
Monthly Compensation, in which the Participant had the highest
Aggregate Compensation) multiplied by the lesser of (1) 2% for each
Year of Benefit Service performed while actually participating in
the Plan during a Plan Year in which the Plan is determined to be
Top-Heavy, or (2) 20%.
A Participant will not be required to be employed on the last day of
a Plan Year in order to be entitled to benefit provided by this
Section 6.02(a). The Plan may not satisfy the requirements of this
Section 6.02(a) through Employer contributions to Social Security.
(b) Non-Application
Notwithstanding the provisions of Section 6.02(a), if a Non-Key
Employee who is a participant in this Plan, is also participating in
a defined contribution plan maintained by the Employer or a Related
Employer in which, for a given Plan Year, the allocation of employer
contributions plus allocated forfeitures is not less than 5% of the
6-1
Non-Key Employee's Aggregate Compensation, the Participant will not
be entitled to the minimum benefit provided for in Section 6.02(a)
for the Plan Year.
6-2
ARTICLE 7
LIMITATIONS ON BENEFITS
7.01 Limitation on Benefits
(a) In General
The annual benefit otherwise payable to a Participant under this
Plan will not at any time exceed the Defined Benefit Limit. The
limitation described in this Section will be deemed satisfied as to
any Participant if the annual benefit otherwise payable under this
Plan to the Participant does not exceed $1,000 multiplied by the
Participant's number of Years of Service or parts thereof (not to
exceed 10) with the Employer, and the Employer has not at any time
maintained a defined contribution plan, as defined in Section 7.02,
in which the Participant participated.
If the annual benefit which is payable to a Participant who has
separated from service with a nonforfeitable right to an Accrued
Benefit is limited by the Defined Benefit Dollar Limit, such annual
benefit will be increased on January 1 of each calendar year to the
extent that the Defined Benefit Dollar Limit is increased in
accordance with Code Section 415(b)(1)(A) as provided for in Section
7.03(f); however, the annual benefit will not be increased above the
amount which would be payable without regard to the Defined Benefit
Dollar Limit.
If the Employer maintains one or more qualified defined benefit
plans in addition to this Plan, the sum of the Annual Benefits
payable under each plan will be treated as a single Annual Benefit
for the purposes of applying the limitations hereunder. If the sum
of the Annual Benefits exceeds, in the aggregate, the Defined
Benefit Limit, the Annual Benefit of each plan will be reduced
ratably until the sum of the reduced Annual Benefits satisfies the
limitations under this paragraph.
(b) Preservation of Pre-TRA '86 Accrued Benefit
Any Participant's Annual Benefit payable under the Plan will be not
less than the Participant's Accrued Benefit determined as if he had
separated from service as of the close of the last Limitation Year
beginning before January 1, 1987, disregarding any change in the
terms and conditions of the Plan after May 5, 1986 and any cost of
living adjustments occurring after May 5, 1986.
7.02 Where Employer Maintains a Qualified Defined Contribution Plan
(a) In General
If the Employer maintains (or has ever maintained), in addition to
this Plan, one or more qualified defined contribution plans, one or
more welfare benefit funds (as defined in Code Section 419(e)), or
one or more individual medical accounts (as defined in Code Section
415(l)(2)), all of which are referred to in this Article 7 as
"qualified defined contribution plans", then the limitation
7-1
described in Section 7.01 will be further limited by this Section
7.02. For any Limitation Year, the sum of the Defined Benefit Plan
Fraction plus the Defined Contribution Plan Fraction will not exceed
1.0. If, in any Limitation Year, the sum of the Defined Benefit
Plan Fraction and the Defined Contribution Plan Fraction for a
Participant would exceed 1.0 without adjustment to the amount of the
annual benefit that can be paid to the Participant under the Plan,
then the amount of annual benefit that would otherwise be paid to
the Participant under this Plan will be reduced to the extent
necessary to reduce the sum of the Defined Benefit Plan Fraction and
the Defined Contribution Plan Fraction for the Participant to 1.0.
(b) Transition Rule under TRA '86
In the case of a plan which met the limitation of Section 415 of the
Code for the last Limitation Year beginning before January 1, 1987,
the numerator of the Defined Contribution Plan Fraction will be
reduced (to not less than zero) as prescribed by the Secretary of
the Treasury by subtracting the amount required to decrease the sum
of the Defined Contribution Plan Fraction plus the Defined Benefit
Plan Fraction to 1.0. Such amount is determined (as of the first
day of the first Limitation Year beginning on or after January 1,
1987) as the product of:
(1) The amount by which, without this adjustment, the sum of the
Defined Contribution Plan Fraction plus the Defined Benefit Plan
Fraction exceeds 1.0; multiplied by
(2) The denominator of the Defined Contribution Plan Fraction, as
computed through the last Limitation Year beginning before
January 1, 1987, disregarding any changes in the terms and
conditions of the plan after May 5, 1986.
This subparagraph applies only if the defined benefit plans
individually and in the aggregate satisfied the requirements of
Code Section 415 for all Limitation Years beginning before
January 1, 1987.
(c) Transitional Rule under TEFRA
In the case of a plan which met the limitation of Section 415 of the
Code for the last Limitation Year beginning before January 1, 1983,
the numerator of the Defined Contribution Plan Fraction will be
reduced by the amount required to decrease the sum of the Defined
Contribution Plan Fraction plus the Defined Benefit Plan Fraction to
1.0. Such amount is determined (as of the first day of the first
Limitation Year beginning on or after January 1, 1983) as the
product of:
(1) The amount by which, without this adjustment, the sum of the
Defined Contribution Plan Fraction plus the Defined Benefit Plan
Fraction exceeds 1.0; multiplied by
(2) The denominator of the Defined Contribution Plan Fraction, as
computed through the last Limitation Year beginning before
January 1, 1983.
7-2
7.03 Definitions Applicable to Article 7
(a) Aggregate Compensation
Aggregate Compensation means a Participant's earned income, wages,
salaries, and fees for professional services, and other amounts
received for personal services actually rendered in the course of
employment with the employer maintaining the plan (including, but
not limited to, commissions paid to salesmen, compensation for
services on the basis of a percentage of profits, commissions on
insurance premiums, tips and bonuses), and excluding the following:
o Employer contributions to a plan of deferred compensation which
are not included in the employee's gross income for the taxable
year in which contributed or employer contributions under a
simplified employee pension plan to the extent the contributions
are deductible by the employee, or any distributions from a plan
of deferred compensation;
o Amounts realized from the exercise of a nonqualified stock
option, or when restricted stock (or property) held by the
employee either becomes freely transferable or is no longer
subject to a substantial risk of forfeiture;
o Amounts realized from the sale, exchange or other disposition of
stock acquired under a qualified stock option; and
o Other amounts which received special tax benefits, or
contributions made by the employer (whether or not under a
salary reduction agreement) toward the purchase of an annuity
described in Code Section 403(b) (whether or not the amounts are
actually excludable from the gross income of the employee).
Aggregate Compensation excludes any amounts contributed by the
Employer or any Related Employer on behalf of any Employee pursuant
to a salary reduction agreement which are not includible in the
gross income of the Employee due to Code Section 125, 402(a)(8),
402(h) or 403(b).
Aggregate Compensation in excess of $200,000 (as adjusted in
accordance with Code Section 401(a)(17)) is disregarded.
Aggregate Compensation for any Limitation Year is the Aggregate
Compensation actually paid or includible in gross income in such
year.
(b) Allocation Date, Valuation Date
These terms are used interchangeably and mean the date with respect
to which all or a portion of employer contributions, employee
contributions or forfeitures or both are allocated to participant
accounts under a defined contribution plan.
7-3
(c) Annual Additions
For Plan Years beginning after December 31, 1986, Annual Additions
are the sum of the following amounts allocated to any defined
contribution plan maintained by the Employer (including voluntary
contributions to any defined benefit plan maintained by the
Employer) on behalf of a Participant for a Limitation Year:
o All Employee and Employer contributions;
o All reallocated forfeitures;
o Amounts allocated after March 31, 1984, to an individual medical
account, as defined in Code Section 415(l)(2) which is part of a
pension or annuity plan maintained by the Employer, and amounts
derived from contributions paid or accrued after December 31,
1985, in taxable years ending after that date, which are
attributable to post-retirement medical benefits required by
Code Section 401(h)(6) to be allocated to the separate account
of a Key Employee under a welfare benefit plan (as defined in
Code Section 419(e)) maintained by the Employer.
Contributions or forfeitures will be treated as Annual Additions
regardless of whether they constitute Excess Deferrals, Excess
Contributions or Excess Aggregate Contributions within the meaning
of the regulations under Code Section 401(k) or 401(m) and
regardless of whether they are corrected through distribution or
recharacterization. The Annual Addition for any Limitation Year
beginning before January 1, 1987, will not be recomputed to treat
all Employee contributions as Annual Additions.
(d) Annual Benefit
Annual Benefit means a benefit payable annually in the form of a
straight life annuity (with no ancillary benefits) under a plan to
which employees do not contribute and under which no rollover
contributions are made.
(e) Defined Benefit Compensation Limit
The Defined Benefit Compensation Limit is equal to 100% of the
Participant's average Aggregate Compensation for the three
consecutive calendar years (or other twelve consecutive month
periods adopted by the Employer pursuant to a Written Resolution and
applied on a uniform and consistent basis) of service during which
the Participant had the greatest Aggregate Compensation.
Where the annual benefit is payable to a Participant in a form other
than a straight life annuity or a Qualified Joint and Survivor
Annuity, the Defined Benefit Compensation Limit will be the
Actuarial Equivalent of a straight life annuity beginning at the
same age. No adjustment is required for the following:
pre-retirement disability benefits, pre-retirement death benefits
and post-retirement medical benefits. For purposes of this
paragraph, the interest rate used in adjusting the Defined Benefit
Compensation Limit will be the greater of (1) 5%, or (2) the
post-retirement interest rate specified in the plan for Actuarial
7-4
Equivalent purposes.
Where the annual benefit is payable to a Participant who has fewer
than 10 years of service with the Employer or any Related or
Predecessor Employer, the Defined Benefit Compensation Limit will be
multiplied by a fraction, the numerator of which is the
Participant's number of years of service with the Employer or
Related or Predecessor Employer, and the denominator of which is
10.
With regard to a Participant who has separated from service with a
nonforfeitable right to an Accrued Benefit, the Defined Benefit
Compensation Limit will be adjusted effective January 1 of each
Calendar year. For any Limitation Year beginning after the
separation occurs, the Defined Benefit Compensation Limit will be
equal to the Defined Benefit Compensation Limit which was applicable
to the Participant in the Limitation Year in which he separated from
service multiplied by a fraction, the numerator of which is the
Defined Benefit Dollar Limit for the Limitation Year in which the
Defined Benefit Compensation Limit is being adjusted and the
denominator of which is the Defined Benefit Dollar Limit for the
Limitation Year in which the Participant separated from service.
(f) Defined Benefit Dollar Limit
The Defined Benefit Dollar Limit is equal to $90,000 for calendar
years 1984 through 1987. As of January 1, 1988 and as of January 1
of each subsequent calendar year, the dollar limitation (described
in Code Section 415(b)(1)(A)) as determined by the Secretary of the
Treasury for that calendar year will become effective as the Defined
Benefit Dollar Limit for the calendar year. For calendar years
between 1976 and 1983, the Defined Benefit Dollar Limit is $75,000
as adjusted by the Secretary of the Treasury under Code Section
415(d) for that calendar year. The Defined Benefit Dollar Limit for
a calendar year applies to Limitation Years ending with or within
that calendar year.
Where the annual benefit is payable to a Participant in a form other
than a straight life annuity or a Qualified Joint and Survivor
Annuity, the Defined Benefit Dollar Limit will be the Actuarial
Equivalent of a straight life annuity beginning at the same age. No
adjustment is required for the following: pre-retirement disability
benefits, pre-retirement death benefits, and post-retirement medical
benefits. For purposes of this paragraph, the interest rate used
for adjusting the Defined Benefit Dollar Limit will be the greater
of (1) 5%, or (2) the post-retirement interest rate specified for
Actuarial Equivalent purposes.
Where the annual benefit is payable to a Participant who has fewer
than 10 years of participation in the Plan, the Defined Benefit
Dollar Limit will be multiplied by a fraction, the numerator of
which is the Participant's number of years (or part thereof) of
participation in the Plan, and the denominator of which is 10. To
the extent provided by the Secretary of the Treasury, this paragraph
will be applied to each change in the benefit structure of the
7-5
Plan.
For a benefit commencing before a Participant's Social Security
Retirement Age but at or after age 62, the Defined Benefit Dollar
Limit will be adjusted in a manner which is consistent with the
reduction for old-age insurance benefits commencing before Social
Security Retirement Age under the Social Security Act. The
reduction will be 5/9 of 1% for each of the first 36 months and 5/12
of 1% for each additional month (up to 24 months) by which benefits
commence before the month of the Participant's Social Security
Retirement Age. The Defined Benefit Dollar Limit for a benefit
commencing before age 62 will be adjusted to the Actuarial
Equivalent of the Defined Benefit Dollar Limit for a benefit
commencing at age 62 based on an interest rate equal to the greater
of (1) 5%, or (2) the interest rate specified in the plan for
determining actuarial equivalence for early retirement.
For a benefit commencing after a Participant's Social Security
Retirement Age, the Defined Benefit Dollar Limit will be adjusted to
the actuarial equivalent of the Defined Benefit Dollar Limit for a
benefit commencing at the Participant's Social Security Retirement
Age. For purposes of this paragraph, the interest rate used for
adjusting the Defined Benefit Dollar Limit will be the lesser of (1)
5%, or (2) the interest rate specified in the plan for determining
actuarial equivalence for early retirement.
(g) Defined Benefit Limit
The Defined Benefit Limit is the lesser of the Defined Benefit
Dollar Limit or the Defined Benefit Compensation Limit.
(h) Defined Benefit Plan Fraction Denominator
The Defined Benefit Plan Fraction Denominator with respect to any
Participant is the lesser of (1) the product of the Defined Benefit
Dollar Limit multiplied by 1.25, or (2) the product of the Defined
Benefit Compensation Limit multiplied by 1.4. However, for purposes
of determining the Defined Benefit Plan Fraction Denominator, "years
of service with the Employer or any Related or Predecessor Employer"
will be substituted for "years of participation in the Plan"
wherever it appears in Section 7.03(f).
(i) Defined Benefit Plan Fraction
The Defined Benefit Plan Fraction is a fraction determined as of the
close of a Limitation Year, the numerator of which is the Projected
Annual Benefit payable to a Participant under this Plan and the
denominator of which is the Defined Benefit Fraction Denominator.
If a Participant has participated in more than one defined benefit
plan maintained by the Employer, the numerator of the Defined
Benefit Plan Fraction is the sum of the projected annual benefits
payable to the Participant under all of the defined benefit plans,
whether or not terminated.
(j) Defined Contribution Limit
The Defined Contribution Limit for a given Limitation Year is equal
to the lesser of (1) the Defined Contribution Compensation Limit,
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which is 25% of Aggregate Compensation applicable to the Limitation
Year, or (2) the Defined Contribution Dollar Limit, which, for
calendar years after 1983 is the greater of $30,000 or one-fourth of
the Defined Benefit Dollar Limit for the Limitation Year, and for
calendar years between 1976 and 1983 is one-third of the Defined
Benefit Dollar Limit. If a short Limitation Year is created because
of an amendment changing the Limitation Year to a different 12
consecutive month period, the Defined Contribution Dollar Limit is
multiplied by a fraction, the numerator of which is equal to the
number of months in the short Limitation Year and the denominator of
which is 12.
(k) Defined Contribution Plan Fraction
The Defined Contribution Plan Fraction is a fraction determined as
of the close of a Limitation Year, the numerator of which is the sum
of the Annual Additions to the Participant's Accounts under all
defined contribution plans of the Employer for the current and all
prior Limitation Years and the denominator of which is the sum of
the Annual Additions which would have been made for the Participant
for the current and all prior Limitation Years (for all prior years
of service with the Employer or any predecessor Employer) if in each
Limitation year the Annual Additions equaled the lesser of (1) the
product of the Defined Contribution Compensation Limit for the
Limitation Year multiplied by 1.4, or (2) the product of the Defined
Contribution Dollar Limit for the Limitation Year multiplied by
1.25. The aggregate amount in the numerator of this fraction due to
years beginning before January 1, 1976 may not exceed the aggregate
amount in the denominator of this fraction for all such years.
For purposes of this Section 7.03(k), the Annual Addition for any
Limitation Year beginning before January 1, 1987 will not be
recomputed to treat all Employee contributions as Annual Additions.
(l) Employer
The Employer is the Employer that adopts this Plan together with all
Related Employers. For this purpose, the definition of Related
Employer in Section 1.33 of this Plan is modified by Code Section
415(h).
(m) Limitation Year
The Limitation Year will be the 12 consecutive month period which is
specified in Article 1 of this Plan and which is adopted for all
qualified plans maintained by the Employer pursuant to a Written
Resolution adopted by the Employer. In the event of a change in the
Limitation Year, the additional limitations of Treasury Regulation
Section 1.415-2(b)(4)(iii) will also apply.
(n) Projected Annual Benefit
For purposes of this Section, a Participant's Projected Annual
Benefit is equal to the annual benefit to which a Participant in a
defined benefit Plan would be entitled under the terms of the plan
based on the following assumptions:
o The Participant will continue employment until reaching normal
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retirement age as determined under the terms of the plan (or
current age, if that is later);
o The Participant's compensation for the Limitation Year under
consideration will remain the same for all future years;
o All other relevant factors used to determine benefits under the
plan for the Limitation Year under consideration will remain
constant for all future Limitation Years; and
o The benefits resulting from any Participant Contributions or
Rollover Contributions are disregarded.
(o) Social Security Retirement Age
Social Security Retirement Age means age 65 for a Participant born
before January 1, 1938; age 66 for a Participant born after December
31, 1937, but before January 1, 1955; and age 67 for a Participant
born after December 31, 1954.
7.04 Effect of Top-Heavy Status
Notwithstanding the provisions of Section 7.03, "1.0" will be
substituted for "1.25" wherever it appears in Sections 7.03(h) and
7.03(k) for any Limitation Year in which the Plan is found to be
Top-Heavy for the Plan Year which coincides with or ends within the
Limitation Year.
7-8
ARTICLE 8
MISCELLANEOUS
8.01 Employment Rights of Parties Not Restricted
The adoption and maintenance of this Plan will not be deemed a contract
between the Employer and any Employee. Nothing in this Plan will give
any Employee or Participant the right to be retained in the employ of
the Employer or to interfere with the right of the Employer to discharge
any Employee or Participant at any time, nor will it give the Employer
the right to require any Employee or Participant to remain in its
employ, or to interfere with any Employee's or Participant's right to
terminate his employment at any time.
8.02 Alienation
(a) General
No person entitled to any benefit under this Plan will have any
right to sell, assign, transfer, hypothecate, encumber, commute,
pledge, anticipate or otherwise dispose of his interest in the
benefit, and any attempt to do so will be void. No benefit under
this Plan will be subject to any legal process, levy, execution,
attachment or garnishment for the payment of any claim against such
person.
(b) Exceptions
Section 8.02(a) will not apply to a qualified domestic relations
order (QDRO) as defined in Code Section 414(p), and those other
domestic relations orders permitted to be so treated by the Plan
Administrator under the provisions of the Retirement Equity Act of
1984. The Plan Administrator will establish a written procedure to
determine the qualified status of domestic relations orders and to
administer distributions under such qualified orders. Further, to
the extent provided under a QDRO, a former spouse of a Participant
will be treated as the spouse or Surviving Spouse for all purposes
under the Plan. Where, however, because of a QDRO, more than one
individual is to be treated as a Surviving Spouse, the total amount
to be paid in the form of a Qualified Survivor Annuity or the
survivor portion of a Qualified Joint and Survivor Annuity may not
exceed the amount that would be paid if there were only one
Surviving Spouse. All rights and benefits, including elections,
provided to a Participant under this Plan will be subject to the
rights afforded to any alternate payee as such term is defined in
Code Section 414(p).
8.03 Qualification of Plan
The Employer will have the sole responsibility for obtaining and
retaining qualification of the Plan under the Code with respect to the
Employer's individual circumstances.
8.04 Construction
To the extent not preempted by ERISA, this Plan will be construed
according to the laws of the state in which the Employer's principal
place of business is located. Words used in the singular will include
8-1
the plural, the masculine gender will include the feminine, and vice
versa, whenever appropriate.
8.05 Named Fiduciaries
(a) Allocation of Functions
The authority to control and manage the operation and administration
of the Plan and Trust created by this instrument will be allocated
between the Plan Sponsor, the Trustee, and the Plan Administrator,
all of whom are designated as Named Fiduciaries with respect to the
Plan and Trust as provided for by Section 402(a)(2) of ERISA. The
Plan Sponsor reserves the right to allocate the various
responsibilities for the present execution of the functions of the
Plan, other than the Trustees' responsibilities, among its Named
Fiduciaries. Any person or group of persons may serve in more than
one fiduciary capacity with regard to the Plan.
(b) Responsibilities of the Plan Sponsor
The Plan Sponsor, in its capacity as a Named Fiduciary, will have
only the following authority and responsibility:
o To appoint or remove the Plan Administrator and furnish the
Trustee with certified copies of any resolutions of the Plan
Sponsor with regard thereto;
o To appoint and remove the Trustee;
o To appoint a successor Trustee or additional Trustees;
o To communicate information to the Plan Administrator and the
Trustee as needed for the proper performance of the duties of
each;
o To appoint an investment manager (or to refrain from such
appointment), to monitor the performance of the investment
manager so appointed, and to terminate such appointment (more
than one investment manager may be appointed and in office at
any time); and
o To establish and communicate to the Trustee a funding policy for
the Plan.
(c) Limitation on Obligations of Named Fiduciaries
No Named Fiduciary will have authority or responsibility to deal
with matters other than as delegated to it under this Plan or by
operation of law. A Named Fiduciary will not in any event be liable
for breach of fiduciary responsibility or obligation by another
fiduciary (including Named Fiduciaries) if the responsibility or
authority of the act or omission deemed to be a breach was not
within the scope of the Named Fiduciary's authority or delegated
responsibility.
(d) Standard of Care and Skill
The duties of each fiduciary will be performed with the care, skill,
8-2
prudence and diligence under the circumstances then prevailing that
a prudent person acting in a like capacity and familiar with such
matters would use in the conduct of an enterprise of like character
and with like objectives.
8.06 Status of Insurer
The term Insurer refers to any legal reserve life insurance company
licensed to do business in the state within which the Employer maintains
its principal office. The Insurer will file such returns, keep such
records, make such reports and supply such information as required by
applicable law or regulation.
8.07 Adoption and Withdrawal by Other Organizations
(a) Procedure for Adoption
Subject to the provisions of this Section 8.07, any organization now
in existence or hereafter formed or acquired, which is not already a
Participating Employer under this Plan and which is otherwise
legally eligible may, in the future, with the consent and approval
of the Plan Sponsor, by formal Written Resolution (referred to in
this Section as an Adoption Resolution), adopt the Plan and Trust
hereby created for all or any classification of persons in its
employment and thereby, from and after the specified effective date,
become a Participating Employer under this Plan. Such consent will
be effected by and evidenced by a formal Written Resolution of the
Plan Sponsor. The Adoption Resolution may contain such specific
changes and variations in Plan terms and provisions applicable to
the adopting Participating Employer and its Employees as may be
acceptable to the Plan Sponsor and the Trustee. However, the sole,
exclusive right of any other amendment of whatever kind or extent to
the Plan is reserved to the Plan Sponsor. The Adoption Resolution
will become, as to the adopting organization and its Employees, a
part of this Plan as then amended or thereafter amended. It will
not be necessary for the adopting organization to sign or execute
the original or then amended Plan and Trust Agreement or any future
amendment to the Plan and Trust Agreement. The effective date of
the Plan for any adopting organization will be that stated in the
Adoption Resolution and from and after such effective date the
adopting organization will assume all the rights, obligations and
liabilities as a Participating Employer under this Plan. The
administrative powers of and control by the Plan Sponsor as provided
in the Plan, including the sole right of amendment or termination of
the Plan, of appointment and removal of the Plan Administrator and
the Trustee, and of appointment and removal of an investment manager
will not be diminished by reason of the participation of the
adopting organization in the Plan.
(b) Withdrawal
Any Participating Employer may withdraw from the Plan at any time,
without affecting the Plan Sponsor or other Participating Employers
not withdrawing, by complying with the provisions of the Plan. A
withdrawing Participating Employer may arrange for the continuation
by itself or its successor of this Plan in separate forms for its
own employees, with such amendments, if any, as it may deem proper,
8-3
and may arrange for continuation of the Plan by merger with an
existing plan and transfer of plan assets. The Plan Sponsor may, it
its absolute discretion, terminate a Participating Employer's
participation at any time when in its judgment the Participating
Employer fails or refuses to discharge its obligations under the
Plan.
(c) Adoption Contingent Upon Initial and Continued Qualifications
The adoption of this Plan by an organization as provided is hereby
made contingent and subject to the condition precedent that said
adopting organization meets all the statutory requirements for
qualified plans, including, but not limited to, Sections 401(a) and
501(a) of the Internal Revenue Code for its Employees. If the Plan
or the Trust, in its operation, becomes disqualified, for any
reason, as to the adopting organization and its Employees, the
portion of the Plan assets allocable to them will be segregated as
soon as is administratively feasible, pending either the prompt (1)
requalification of the Plan as to the organization and its employees
to the satisfaction of the Internal Revenue Service so as not to
affect the continued qualified status thereof as to other Employers,
(2) withdrawal of the organization from this Plan and a continuation
by itself or its successor of its plan separately from this Plan, or
by merger with another existing plan, with a transfer of its said
segregated portion of Plan assets, or (3) termination of the Plan as
to itself and its Employees.
8.08 Employer Contributions
The Employer (and any Participating Employers) will make contributions
to the Plan at its discretion, except that contributions will not be
less than the minimum contribution required by any applicable sections
of the Code, including Section 412, and with any other applicable
federal statute.
Employer contributions made to the Plan are made and will be held for
the sole purpose of providing benefits to Participants and their
Beneficiaries. In no event will any contribution made by the Employer
to the Plan or income therefrom revert to the Employer or otherwise be
used or diverted to purposes other than for the exclusive benefit of
Participants and their Beneficiaries (including costs of maintaining and
administering the Plan). Notwithstanding the foregoing, Employer
contributions may be refunded to the Employer on written demand within
one year of the event giving rise to the right to refund and upon
presentation to the Trustee of evidence of the right to and amount of
the refund, but only to the extent that the refunds do not, in
themselves, deprive the Plan of its qualified status, under the
following circumstances and subject to the following limitations:
(a) Any contribution which is made in whole or in part by reason of a
mistake of fact (for example, incorrect information as to the
eligibility or compensation of a Participant, or a mathematical or
actuarial error), will be returned to the Employer.
(b) Notwithstanding any other provision of the Plan, if the Internal
Revenue Service determines initially that the Plan, as adopted by
8-4
the Employer, does not qualify under applicable sections of the Code
and applicable Treasury Department Regulations, and the Employer
declines either to amend this Plan so that it meets the objections
of the Internal Revenue Service or to contest the determination of
the Internal Revenue Service in court, the value of all assets will
be distributed by the Trustee to the Employer. Thereafter, the
Employer's participation in this Plan will be considered rescinded
and of no force or effect.
(c) Any contribution made by the Employer will be conditioned on the
deductibility of such contribution and may be refunded to the
Employer, to the extent the contribution is determined not to be
deductible, within one year after such determination is made.
(d) In the event of termination of the Plan, funds may revert to the
Employer as provided in Section 10.02.
8-5
ARTICLE 9
ADMINISTRATION
9.01 Plan Administrator
The Plan Administrator will have the responsibility for the general
supervision and administration of the Plan and will be a fiduciary of
the Plan. The Employer may, by Written Resolution, appoint one or more
individuals to serve as Plan Administrator. If the Employer does not
appoint an individual or individuals as Plan Administrator, the Employer
will function as Plan Administrator. The Employer may at any time, with
or without cause, remove an individual as Plan Administrator or
substitute another individual therefor.
9.02 Powers and Duties of the Plan Administrator
The Plan Administrator will be charged with and will have delegated to
it the power, duty, authority and discretion to interpret and construe
the provisions of this Plan, to determine its meaning and intent and to
make application thereof to the facts of any individual case; to
determine in its discretion the rights and benefits of Participants or
the eligibility of Employees; to give necessary instructions and
directions to the Trustee and the Insurer as herein provided or as may
be requested by the Trustee and the Insurer from time to time; to
resolve all questions of fact relating to any of the foregoing; and to
generally direct the administration of the Plan according to its terms.
All decisions of the Plan Administrator in matters properly coming
before it according to the terms of this Plan, and all actions taken by
the Plan Administrator in the proper exercise of its administrative
powers, duties and responsibilities, will be final and binding upon all
Employees, Participants and Beneficiaries and upon any person having or
claiming any rights or interest in this Plan. The Employer and the Plan
Administrator will make and receive any reports and information, and
retain any records necessary or appropriate to the administration of
this Plan or to the performance of duties hereunder or to satisfy any
requirements imposed by law. In the performance of its duties, the Plan
Administrator will be entitled to rely on information duly furnished by
any Employee, Participant or Beneficiary or by the Employer or Trustee.
9.03 Actions of the Plan Administrator
The Plan Administrator may adopt such rules as it deems necessary,
desirable or appropriate with respect to the conduct of its affairs and
the administration of the Plan. Whenever any action to be taken in
accordance with the terms of the Plan requires the consent or approval
of the Plan Administrator, or whenever an interpretation is to be made
of the terms of the Plan, the Plan Administrator will act in a uniform
and non-discriminatory manner, treating all Employees and Participants
in similar circumstances in a like manner. If the Plan Administrator is
a group of individuals, all of its decisions will be made by a majority
vote. The Plan Administrator will have the authority to employ one or
more persons to render advice or services with regard to the
responsibilities of the Plan Administrator, including but not limited to
attorneys, actuaries, and accountants. Any persons employed to render
advice or services will have no fiduciary responsibility for any
ministerial functions performed with respect to this Plan.
9-1
9.04 Reliance on Plan Administrator and Employer
Until the Employer gives notice to the contrary, the Trustee and any
persons employed to render advice or services will be entitled to rely
on the designation of Plan Administrator that has been furnished to
them. In addition, the Trustee and any persons employed to render
advice or services will be fully protected in acting upon the written
directions and instructions of the Plan Administrator made in accordance
with the terms of this Plan. If the Plan Administrator is a group of
individuals, unless otherwise specified, any one of such individuals
will be authorized to sign documents on behalf of the Plan Administrator
and such authorized signatures will be recognized by all person dealing
with the Plan Administrator. The Trustee and any persons employed to
render advice or services may take cognizance of any rules established
by the Plan Administrator and rely upon them until notified to the
contrary. The Trustee and any persons employed to render advice or
services will be fully protected in taking any action upon any paper or
document believed to be genuine and to have been properly signed and
presented by the Plan Administrator, Employer or any agent of the Plan
Administrator acting on behalf of the Plan Administrator.
9.05 Reports to Participants
The Plan Administrator will report in writing to a Participant his
Accrued Benefit under the Plan and the Vested Percentage of such benefit
when the Participant terminates his employment or requests such a report
in writing from the Plan Administrator. To the extent required by law
or regulation, the Plan Administrator will annually furnish to each
Participant, and to each Beneficiary receiving benefits, a report which
fairly summarizes the Plan's most recent report.
9.06 Bond
The Plan Administrator and other fiduciaries of the Plan will be bonded
to the extent required by ERISA or other applicable law. No additional
bond or other security for the faithful performance of any duties under
this Plan will be required.
9.07 Compensation of Plan Administrator
The Compensation of the Plan Administrator will be left to the
discretion of the Plan Sponsor; no person who is receiving full pay from
the Employer will receive compensation for services as Plan
Administrator. All reasonable and necessary expenses incurred by the
Plan Administrator in supervising and administering the Plan will be
paid from the Plan assets by the Trustee at the direction of the Plan
Administrator to the extent not paid by the Plan Sponsor.
9.08 Claims Procedure
The Plan Administrator will make all determinations as to the rights of
any Employee, Participant, Beneficiary or other person under the terms
of this Plan. Any Employee, Participant or Beneficiary, or person
claiming under them, may make claim for benefit under this Plan by
filing written notice with the Plan Administrator setting forth the
substance of the claim. If a claim is wholly or partially denied, the
claimant will have the opportunity to appeal the denial upon filing with
the Plan Administrator a written request for review within 60 days after
9-2
receipt of notice of denial. In making an appeal the claimant may
examine pertinent Plan documents and may submit issues and comments in
writing. Denial of a claim or a decision on review will be made in
writing by the Plan Administrator delivered to the claimant within 60
days after receipt of the claim or request for review, unless special
circumstances require an extension of time for processing the claim or
review, in which event the Plan Administrator's decision must be made as
soon as possible thereafter but not beyond an additional 60 days. If no
action on an initial claim is taken within 120 days, the claims will be
deemed denied for purposes of permitting the claimant to proceed to the
review stage. The denial of a claim or the decision on review will
specify the reasons for the denial or decision and will make reference
to the pertinent Plan provisions upon which the denial or decision is
based. The denial of a claim will also include a description of any
additional material or information necessary for the claimant to perfect
the claim and an explanation of the claim review procedure herein
described. The Plan Administrator will serve as an agent for service of
legal process with respect to the Plan unless the Employer, through
written resolution, appoints another agent.
If a Participant or Beneficiary is entitled to a distribution from the
Plan, the Participant or Beneficiary will be responsible for providing
the Plan Administrator with his current address. If the Plan
Administrator notifies the Participant or Beneficiary by registered mail
(return receipt requested) at his last known address that he is entitled
to a distribution and also notifies him of the provisions of this
paragraph, and the Participant or Beneficiary fails to claim his
benefits under the Plan or provide his current address to the Plan
Administrator within one year after such notification, the distributable
amount will be forfeited and used to reduce the cost of the Plan. If
the Participant or Beneficiary is subsequently located, such benefit
will be restored. If this Plan is terminated in accordance with Section
10.01, then any unrestored benefits which were previously forfeited in
accordance with this paragraph will be restored prior to the application
of Section 10.02.
9.09 Liability of Fiduciaries
Except for a breach of fiduciary responsibility due to gross negligence
or willful misconduct, the Plan Administrator will not incur any
individual liability for any decision, act, or failure to act
hereunder. The Plan Administrator may engage agents to assist it and
may engage legal counsel who may be counsel for the Employer. The Plan
Administrator will not be responsible for any action taken or omitted to
be taken on the advice of counsel.
If there is more than one person serving as a fiduciary in any capacity
(for example, co-Trustees), each will use reasonable care to prevent the
other or others from committing a breach of this Plan. Nothing
contained in this Section will preclude any agreement allocating
specific responsibilities or obligations among the co-fiduciaries
provided that the agreement does not violate any of the terms and
provisions of this Plan. In those instances where any duties have been
allocated between co-fiduciaries, a fiduciary will not be liable for any
loss resulting to the Plan arising from any act or omission on the part
9-3
of another co-fiduciary to whom responsibilities or obligations have
been allocated except under the following circumstances:
o If he participates knowingly in, or knowingly undertakes to conceal,
an act or omission of a co-fiduciary knowing the act or omission is
a breach; or
o If by his failure to comply with his specific responsibilities which
give rise to his status as a fiduciary, he has enabled the other
fiduciary to commit a breach; or
o If he has knowledge of a breach by a co-fiduciary, unless he makes
reasonable efforts under the circumstances to remedy the breach.
9.10 Expenses of Administration
The Employer does not and will not guarantee the Plan assets against
loss. The Employer may in its sole discretion, but will not be
obligated to, pay the ordinary expenses of establishing the Plan,
including the fees of consultants, accountants and attorneys in
connection therewith. The Employer may, in its sole discretion (but
will not be obligated to), pay other costs and expenses of administering
the Plan, the taxes imposed upon the Plan, if any, and the fees, charges
or commissions with respect to the purchase and sale of Plan assets.
Unless paid by the Employer, such costs and expenses, taxes (if any),
and fees, charges and commissions will be a charge upon Plan assets and
deducted by the Trustee.
9.11 Distribution Authority
If any person entitled to receive payment under this Plan is a minor,
declared incompetent or is under other legal disability, the Plan
Administrator may, in its sole discretion, direct the Trustee to:
o Distribute directly to the person entitled to the payment;
o Distribute to the legal guardian or, if none, to a parent of the
person entitled to payment or to a responsible adult with whom the
person entitled to payment maintains his residence;
o Distribute to a custodian for the person entitled to payment under
the Uniform Gifts to Minors Act if permitted by the laws of the
state in which the person entitled to payment resides; or
o Withhold distribution of the amount payable until a court of
competent jurisdiction determines the rights of the parties thereto
or appoints a guardian of the estate of the person entitled to
payment.
If there is any dispute, controversy or disagreement between any
Beneficiary or person and any other person as to who is entitled to
receive the benefits payable under this Plan, or if the Plan
Administrator is uncertain as to who is entitled to receive benefits, or
if the Plan Administrator is unable to locate the person who is entitled
to benefits, the Plan Administrator may with acquittance interplead the
funds into a court of competent jurisdiction in the judicial district in
9-4
which the Employer maintains its principal place of business and, upon
depositing the funds with the clerk of the court, be released from any
further responsibility for the payment of the benefits. If it is
necessary for the Plan Administrator to retain legal counsel or incur
any expense in determining who is entitled to receive the benefits,
whether or not it is necessary to institute court action, the Plan
Administrator will be entitled to reimbursement from the benefits for
the amount of its reasonable costs, expenses and attorneys' fees
incurred.
9.12 Funding Policy
The Employer will establish a funding policy upon which contributions
will be based bearing in mind both the short-run and long-run needs and
goals of the Plan. The Plan Administrator will periodically review the
funding policy for its appropriateness under the circumstances then
prevailing and recommend to the Employer any changes in the funding
policy which the Plan Administrator considers appropriate. As an aid to
the Plan Administrator in reviewing the funding policy, the Actuary
appointed by the Plan Administrator will make periodic actuarial
valuations of the assets and liabilities of the Plan and will advise the
Plan Administrator of the results of the valuations.
9-5
ARTICLE 10
AMENDMENT OR TERMINATION OF PLAN
10.01 Right of Plan Sponsor to Amend or Terminate
The Plan Sponsor reserves the right to alter, amend, revoke or
terminate this Plan. No amendment will deprive any Participant or
Beneficiary of any vested right nor will it reduce the present value
(determined upon an Actuarial Equivalent basis) of any Accrued Benefit
to which he is then entitled with respect to Employer contributions
previously made, except as may be required to maintain the Plan as a
qualified plan under the Code. No amendment will change the duties or
responsibilities of the Trustee without its express written consent
thereto.
A plan amendment which has the effect of (a) eliminating or reducing an
early retirement benefit or a retirement-type subsidy, or (b)
eliminating an optional benefit form, will, with respect to benefits
attributable to service before the amendment be treated as reducing
Accrued Benefits. In the case of a retirement-type subsidy, the
preceding sentence will apply only with respect to a Participant who
satisfies (either before or after the amendment) the preamendment
conditions for the subsidy. In general, a retirement-type subsidy is a
subsidy that continues after retirement but does not include a
disability retirement benefit, a medical benefit, a social security
supplement, a pre-retirement death benefit, or a plant shutdown benefit
(that does not continue after retirement).
A minimum Accrued Benefit value will apply if this Plan is or becomes a
successor to a profit sharing plan, a defined contribution pension
plan, a target benefit plan, or a defined benefit pension plan which
was fully insured, or any plan under which the accrued benefit of a
Participant was determined as a lump sum or account balance. The
Actuarial Equivalent value of a Participant's Accrued Benefit will not
be less than the Actuarial Equivalent value of his Accrued Benefit on
the Effective Date of the Plan.
10.02 Allocation of Assets Upon Termination of Plan
If this Plan is revoked or terminated (in whole or in part) the rights
of each Participant with respect to benefits accrued to the date of
revocation, termination or partial termination will become
nonforfeitable (to the extend funded). The Employer will comply with
any legal requirements to notify the Internal Revenue Service (IRS)
and, if this Plan is covered by Plan Termination Insurance under
Federal law, the Pension Benefit Guaranty Corporation (PBGC). The
Employer will then arrange for allocation of all assets among
Participants in accordance with an actuarial valuation meeting the
requirements of all applicable law and the regulations and requirements
of the IRS and the PBGC. Allocation of assets among Participants will
be in the following order of priority:
(a) first, to any Deductible Voluntary Account, Nondeductible Voluntary
Account or Rollover Account;
10-1
(b) second, to that portion, if any, of each Participant's accrued
benefit which is derived from the Participant's mandatory
contributions.
(c) third, to retirement benefits which were in pay status or were
available to a Participant 3 years before the date of termination
of the Plan based on Plan provisions in effect 5 years before the
date of termination;
(d) fourth, to all other benefits guaranteed by the PBGC (determined
without regard to Section 4022(b)(5) of ERISA and as if Section
4022(b)(6) of ERISA did not apply);
(e) fifth, to all other vested benefits; and
(f) sixth, to all other benefits.
If Plan assets are not sufficient to provide the total amount required
in any classification, the allocation will be proportionately reduced
for all Participants for benefits in such classification. Any part of
a vested benefit not guaranteed by PBGC will take precedence after all
benefits which are guaranteed. The allocation procedure and methods
used will be subject to requirements of law and to any modification
required by either the PBGC or the IRS.
After all required allocations have been made so that all liabilities
of the Plan to Participants and other persons have been satisfied and
all expenses of terminating the Plan and distributing the Plan Assets
have been paid, any residual assets which remain will be returned to
the Employer if the distribution does not contravene any provision of
law. The rights of the Participants or, in the case of a partial
termination, the rights of the Participants affected by the partial
termination will be nonforfeitable as to benefits accrued to the date
of termination, to the extent funded. All allocated amounts will be
retained in the Plan to the credit of the individual Participants until
distribution as directed by the Employer. Distribution to Participants
may be in the form of Policies, cash, other Plan assets,
nontransferable annuity contracts, or partly in each.
In the event of the termination of the Plan, the benefit of any Highly
Compensated Employee (and any Highly Compensated Former Employee) will
be limited to a benefit which is nondiscriminatory in accordance with
the provisions of Code Section 401(a)(4).
10.03 Exclusive Benefit
At no time will any part of the principal or income of the Plan assets
be used or diverted for purposes other than the exclusive benefit of
Participants in the Plan and their Beneficiaries, nor may any portion
of the Plan assets revert to the Employer except as provided in Section
8.08.
10.04 Failure to Qualify
Notwithstanding any of the foregoing provisions, if this Plan, upon
adoption by the Employer, is submitted to the Internal Revenue Service
10-2
which then determines that the Plan as initially adopted by the
Employer is not a qualified plan under the Code, the Employer may elect
to terminate this Plan by giving written notice thereof. Such
termination will have the same effect as if the Plan were never
adopted, all policies and contracts will be canceled, and all
contributions, to the extent recoverable from the Trustee, will be
returned to their source. If any amendment to this Plan is submitted
to the Internal Revenue Service within the period allowed under Code
Section 401(b) which then determines that the Plan as amended is not a
qualified plan under the Code, the Employer may cancel or modify any or
all provisions of the amendment retroactive to the effective date of
the amendment in order to maintain the qualified status of the Plan,
whereupon written notice thereof will be furnished to all affected
Employees, Participants and Beneficiaries.
10.05 Mergers, Consolidations or Transfers of Plan Assets
In the event this Plan is merged or consolidated with another plan
which is qualified under Code Sections 401(a) (and 501(a) if
applicable), or in the event of a transfer of the assets or liabilities
of this Plan to another plan which is qualified under Code Sections
401(a) (and 501(a) if applicable), the benefit which each Participant
would be entitled to receive under the successor plan or other plan if
it were terminated immediately after the merger, consolidation or
transfer will be equal to or greater than the benefit which the
Participant would have received immediately before the merger,
consolidation or transfer if this Plan had then terminated.
Any transfer of assets and/or liabilities to (or from) this Plan from
(or to) another plan qualified under Code Sections 401(a) (and 501(a)
if applicable) will be evidenced by a Written Resolution by the Plan
Sponsor of each affected plan which specifically authorizes such
transfer of assets and/or liabilities.
10.06 Effect of Plan Amendment on Vesting Schedule
No amendment to the Vesting Schedule will deprive a Participant of his
nonforfeitable right to his Vested Accrued Benefit as of the date of
the amendment. Further, if the Vesting Schedule of the Plan is
amended, or if the Plan is amended in any way that directly or
indirectly affects the computation of a Participant's non-forfeitable
percentage, each Participant with at least 3 Years of Vesting Service
as of the last day of the election period described below may elect,
within a reasonable period after the adoption of the amendment, to have
his Vested Percentage computed under the Plan without regard to such
amendment. The period during which such election may be made will
commence with the date the amendment is adopted and will end 60 days
after the latest of:
(a) the date the amendment is adopted;
(b) the date the amendment becomes effective; or
(c) the date the Participant is issued written notice of the amendment
by the Employer.
10-3
10.07 Early Termination of Plan
The provisions of this Section will apply only with respect to
Participants who are Highly Compensated Employees and Highly
Compensated Former Employees (herein called Restricted Participants).
In any one year, the total number of Restricted Participants is limited
to a total of the 25 Highly Compensated Employees and Highly
Compensated Former Employees with the greatest Compensation in the
current or any prior Plan Year.
The annual benefit to which a Restricted Participant will be entitled
is limited to:
o a straight life annuity which is the actuarial equivalent of the
Participant's Accrued Benefit and other benefits to which the
Participant is entitled under the provisions of the Plan (other
than a social security supplement); plus
o the amount of payments the Participant is entitled to receive under
a social security supplement.
Notwithstanding the foregoing, the restrictions of this Section do not
apply if any one of the following requirements is satisfied:
o After the payment to a Restricted Participant of all benefits
payable under the Plan, the market value of Plan assets is not less
than 110% of the value of current liabilities as defined in Code
Section 412(l)(7);
o The value of benefits payable to a Restricted Participant is less
than 1% of the current liabilities before such distribution; or
o The value of benefits payable to a Restricted Participant does not
exceed the amount described in Code Section 411(a)(11)(A)
concerning restrictions on certain mandatory distributions.
For purposes of the above calculations, the market value of plan assets
and the value of current liabilities are to be determined in a manner
which is consistent with Treasury Regulation 1.401(a)(4)-5(b).
10-4
ARTICLE 11
TRUSTEE AND TRUST FUND
11.01 Acceptance of Trust
The Trustee, by signing this Agreement, accepts this Trust and agrees
to perform the duties of the Trustee in accordance with the terms and
conditions set forth herein.
11.02 Trust Fund
(a) Purpose and Nature
The Trustee will establish and maintain a Trust Fund for purposes
of providing a means of accumulating the assets necessary to
provide the benefits which become payable under the Plan. The
Trustee will receive, hold and invest all contributions made by the
Employer, any Participating Employers, and the Participants,
including the investment earnings thereon. The Trust Fund arising
from such contributions and earnings will consist of all assets
held by the Trustee under the Plan and Trust. All benefits payable
under the Plan will be paid by the Trustee from the Trust Fund.
Any person having any claim under the Plan will look solely to the
assets of the Trust Fund for satisfaction. In no event will the
Plan Administrator, the Employer, any Employees, any officer of the
Employer or any agents of the Employer or the Plan Administrator be
liable in their individual capacities to any person whomsoever,
under the provisions of this Plan and Trust, except as provided by
law.
The Trust Fund will be used and applied only in accordance with the
provisions of the Plan and Trust, to provide the benefits thereof,
and no part of the corpus or income of the Trust Fund will be used
for, or diverted to, purposes other than for the exclusive benefit
of the Participants or their Beneficiaries entitled to benefits
under the Plan, except to the extent specifically provided
elsewhere herein.
(b) Investments
The Trustee will invest the Trust Fund in accordance with the
investment policy for the Trust Fund considering the fiduciary
requirements of law, the objectives of the Plan, and the liquidity
needs of the Plan.
(c) Investment Policy
The Plan Sponsor (or the Plan Administrator or an Investment
Committee appointed by the Plan Sponsor) will have the right to
periodically provide the Trustee with a written investment policy
which, in consideration of the needs of the Plan, sets forth the
investment objectives, policies, and guidelines which the Plan
Sponsor judges to be appropriate and prudent.
If a written investment policy is not so provided, then the Trustee
will set forth the investment policy for the Plan. In doing so,
11-1
the Trustee may consult with the Plan Sponsor (or the Plan
Administrator or an Investment Committee appointed by the Plan
Sponsor) to secure information with regard to Plan Sponsor
investment objectives and general investment policy.
(d) Operation of Trust Fund
The Trust Fund will be maintained in accordance with the accounting
requirements of the Plan. No Participant will have any right to
any specific asset or any specific portion of the Trust Fund prior
to distribution of benefits. Withdrawals from the Trust Fund will
be made to provide benefits to Participants and Beneficiaries in
the amounts specified by the Plan, and to pay expenses authorized
by the Plan Administrator.
(e) Plan Sponsor Direction of Investment
The Plan Sponsor will have the right to direct the Trustee with
respect to the investment and reinvestment of assets comprising the
Trust Fund. The Trustee and the Plan Sponsor (or the Plan
Administrator or an Investment Committee appointed by the Plan
Sponsor) will execute a letter of agreement as a part of this Plan
containing such conditions, limitations and other provisions they
deem appropriate before the Trustee will follow any Plan Sponsor
direction with respect to the investment or reinvestment of any
part of the Trust Fund.
11.03 Receipt of Contributions
The Trustee will be accountable to the Employer for the funds
contributed to it, but will have no duty to see that the contributions
received comply with the provisions of the Plan. The Trustee will not
be obligated to collect any contributions from the Employer or the
Participants.
11.04 Powers of the Trustee
Subject to the provisions and limitations contained elsewhere in this
Plan, the Trustee will have full discretion and authority with regard
to the investment of the Trust Fund. The Trustee is authorized and
empowered, but not by way of limitation, with the following powers,
rights and duties:
(a) To invest any part or all of the Trust Fund in any common or
preferred stocks, open-end or closed-end mutual funds, United
States retirement plan bonds, corporate bonds, debentures,
convertible debentures, commercial paper, U.S. Treasury bills,
book entry deposits with the United States Federal Reserve Bank or
System, Master Notes or similar arrangements sponsored by the
Trustee or any other financial institution as permitted by law,
improved or unimproved real estate situated in the United States,
mortgages, notes or other property of any kind, real or personal,
as a prudent man would so invest under like circumstances with due
regard for the purposes of this Plan;
(b) To maintain any part of the assets of the Trust Fund in cash, or in
demand or short-term time deposits bearing a reasonable rate of
interest (including demand or short-term time deposits of or with
11-2
the Trustee), or in a short-term investment fund or in other cash
equivalents having ready marketability, including, but not limited
to, U.S. Treasury Bills, commercial paper, certificates of deposit
(including such certificates of deposit of or with the Trustee),
and similar types of short-term securities, as may be deemed
necessary by the Trustee in its sole discretion;
(c) To manage, sell, contract to sell, grant options to purchase,
convey, exchange, transfer, abandon, improve, repair, insure, lease
for any term even though commencing in the future or extending
beyond the term of the Trust, and otherwise deal with all property,
real or personal, in such manner, for such considerations and on
such terms and conditions as the Trustee will decide;
(d) To credit and distribute the Trust as directed by the Plan
Administrator or any agent of the Plan Administrator. The Trustee
will not be obliged to inquire as to whether any payee or
distributee is entitled to any payment or whether the distribution
is proper or within the terms of the Plan, or as to the manner of
making any payment or distribution. The Trustee will be
accountable only to the Plan Administrator for any payment or
distribution made by it in good faith on the order or direction of
the Plan Administrator or any agent of the Plan Administrator;
(e) To borrow money, assume indebtedness, extend mortgages and encumber
by mortgage or pledge;
(f) To compromise, contest, arbitrate, or abandon claims and demands,
in its discretion;
(g) To have with respect to the Trust all of the rights of an
individual owner, including the power to give proxies, to
participate in any voting trusts, mergers, consolidations or
liquidations, and to exercise or sell stock subscriptions or
conversion rights;
(h) To hold any securities or other property in the name of the Trustee
or its nominee, or in another form as it may deem best, with or
without disclosing the trust relationship;
(i) To perform any and all other acts in its judgment necessary or
appropriate for the proper and advantageous management, investment
and distribution of the Trust;
(j) To retain any funds or property subject to any dispute without
liability for the payment of interest, and to decline to make
payment or delivery of the funds or property until final
adjudication is made by a court of competent jurisdiction;
(k) To file all tax forms or returns required of the Trustee;
(l) To begin, maintain or defend any litigation necessary in connection
with the administration of the Plan, except that the Trustee will
not be obligated to or required to do so unless indemnified to its
11-3
satisfaction; and
(m) To keep any or all of the Trust property at any place or places
within the United States or abroad, or with a depository or
custodian at such place or places; provided, however, that the
Trustee may not maintain the indicia of ownership of any assets of
the Plan outside the jurisdiction of the District Courts of the
United States, except as may be expressly authorized in U.S.
Treasury or U.S. Department of Labor regulations.
11.05 Investment in Common or Collective Trust Funds
Notwithstanding the provisions of Section 11.04, the Plan Sponsor
specifically authorizes the Trustee to invest all or any portion of the
assets comprising the Trust Fund in any common or collective trust fund
which at the time of the investment provides for the pooling of the
assets of plans qualified under Code Section 401(a). The authorization
applies only if such common or collective trust fund: (a) is exempt
from taxation under Code Section 584 or 501(a); (b) if exempt under
Code Section 501(a), expressly limits participation to pension and
profit sharing trusts which are exempt under Code Section 501(a) by
reason of qualifying under Code Section 401(a); (c) prohibits that part
of its corpus or income which equitably belongs to any participating
trust from being used for or diverted to any purposes other than for
the exclusive benefit of the Employees or their Beneficiaries who are
entitled to benefits under such participating trust; (d) prohibits
assignment by participating trust of any part of its equity or interest
in the group trust; and (e) the sponsor of the group trust created or
organized the group trust in the United States and maintains the group
trust at all times as a domestic trust in the United States. The
provisions of the common or collective trust fund agreement, as amended
by the Trustee from time to time, are by this reference incorporated
within this Plan and Trust. The provisions of the common or collective
trust fund will govern any investment of Plan assets in that fund.
This provision constitutes the express permission required by Section
408(b)(8) of ERISA.
11.06 Investment in Insurance Company Contracts
The Trustee may invest any portion of the Trust Fund in a deposit
administration, guaranteed investment or similar type of investment
contract (hereinafter referred to as Contract); provided, however, that
no such Contract may provide for an optional form of benefit which
would not be provided for under the provisions hereof. The Trustee
will be the complete and absolute owner of Contracts held in the Trust
Fund.
The Trustee may convert from one form to another any Contract held in
the Trust Fund; designate any mode of settlement; sell or assign any
Contract held in the Trust Fund; surrender for cash any Contract held
in the Trust Fund; agree with the insurance company issuing any
Contract to any release, reduction, modification or amendment thereof;
and, without limitation of any of the foregoing, exercise any and all
of the rights, options and privileges that belong to the absolute owner
of any Contract held in the Trust Fund that are granted by the terms of
any such Contract or by the terms of this Agreement.
11-4
The Trustee will hold in the Trust Fund the proceeds of any sale,
assignment or surrender of any Contract held in the Trust Fund and any
and all dividends and other payments of any kind received in respect to
any Contract held in the Trust Fund.
No insurance company which may issue any Contract based upon the
application of the Trustee will be responsible for the validity of this
Plan, be required to look into the terms of this Plan, be required to
question any act of the Plan Administrator or the Trustee hereunder or
be required to verify that any action of the Trustee is authorized by
this Plan. If a conflict should arise between the terms of the Plan
and any such Contract, the terms of the Plan will govern.
11.07 Fees and Expenses from Fund
The Trustee will be entitled to receive reasonable annual compensation
as may be mutually agreed upon from time to time between the Plan
Sponsor and the Trustee. The Trustee will pay all expenses reasonably
incurred by it in its administration and investment of the Trust Fund
from the Trust Fund unless the Plan Sponsor pays the expenses. No
person who is receiving full pay from the Plan Sponsor will receive
compensation for services as Trustee.
11.08 Records and Accounting
The Trustee will keep full and complete records of the administration
of the Trust Fund which the Employer and the Plan Administrator may
examine at any reasonable time. As soon as practical after the end of
each Plan Year and at such other reasonable times as the Employer may
direct, the Trustee will prepare and deliver to the Employer and the
Plan Administrator an accounting of the administration of the Trust,
including a report on the valuation of all assets of the Trust Fund,
such valuation to be based upon the fair market value on the valuation
date.
11.09 Distribution Directions
If no one claims a payment or distribution made from the Trust, the
Trustee will notify the Plan Administrator and will dispose of the
payment in accordance with the subsequent direction of the Plan
Administrator.
11.10 Third Party
No person dealing with the Trustee will be obligated to see to the
proper application of any money paid or property delivered to the
Trustee, or to inquire whether the Trustee has acted pursuant to any of
the terms of the Plan. Each person dealing with the Trustee may act
upon any notice, request or representation in writing by the Trustee,
or by the Trustee's duly authorized agent, and will not be liable to
any person whomsoever in so doing. The certification of the Trustee
that it is acting in accordance with the Plan will be conclusive in
favor of any person relying on the certification.
11.11 Professional Agents
The Trustee may employ and pay from the Trust Fund reasonable
compensation to agents, attorneys, accountants and other persons to
11-5
advise the Trustee as in its opinion may be necessary. The Trustee may
delegate to any agent, attorney, accountant or other person selected by
it any non-Trustee power or duty vested in it by the Plan; the Trustee
may act or refrain from acting on the advice or opinion of any agent,
attorney, accountant or other person so selected.
11.12 Valuation of Trust
The Trustee will value the Trust Fund as of the last day of each Plan
Year to determine the fair market value of the Trust, and the Trustee
will value the Trust Fund on such other date(s) as may be necessary to
carry out the provisions of the Plan.
11.13 Liability of Trustee
The Trustee will be liable only for the safeguarding and administration
of the assets of this Trust Fund in accordance with the provisions
hereof and any amendments hereto and no other duties or
responsibilities will be implied. The Trustee will not be required to
pay any interest on funds paid to or deposited with it or to its credit
under the provisions of this Trust, unless pursuant to a written
agreement between the Employer and the Trustee. The Trustee will not
be responsible for the adequacy of the Trust Fund to meet and discharge
any liabilities under the Plan and will not be required to make any
payment of any nature except from funds actually received as Trustee.
The Trustee may consult with legal counsel (who may be legal counsel
for the Employer) selected by the Trustee and will be fully protected
for any action taken, suffered or omitted in good faith in accordance
with the opinion of said legal counsel. It will not be the duty of the
Trustee to determine the identity or mailing address of any Participant
or any other person entitled to benefits hereunder, such identity and
mailing addresses to be furnished by the Employer, the Plan
Administrator or an agent of the Plan Administrator. The Trustee will
be under no liability in making payments in accordance with the terms
of this Plan and the certification of the Plan Administrator or an
agent of the Plan Administrator who has been granted such powers by the
Plan Administrator.
Except to the extent required by any applicable law, no bond or other
security for the faithful performance of duty hereunder will be
required of the Trustee.
11.14 Removal or Resignation and Successor Trustee
A Trustee may resign at any time upon giving 30 days prior written
notice to the Plan Sponsor or, with the consent of the Plan Sponsor, a
Trustee may resign with less than 30 days prior written notice.
The Plan Sponsor may remove a Trustee by giving at least 30 days prior
written notice to the Trustee.
Upon the removal or resignation of a Trustee, the Plan Sponsor will
appoint and designate a successor Trustee which will be one or more
individual successor Trustees or a corporate Trustee organized under
the laws of the United Sates or of any state thereof with authority to
accept and execute trusts. Any successor Trustee must accept and
acknowledge in writing its appointment as a successor Trustee before it
11-6
can act in such capacity.
Title to all property and records or true copies of such records
necessary to the current operation of the Trust Fund held by the
Trustee hereunder will vest in any successor Trustee acting pursuant to
the provisions hereof, without the execution or filing of any further
instrument. Any resigning or removed Trustee will execute all
instruments and do all acts necessary to vest such title in any
successor Trustee of record. Each successor Trustee will have,
exercise and enjoy all the powers, both discretionary and ministerial,
herein conferred upon his predecessor. No successor Trustee will be
obligated to examine the accounts, records and acts of any previous
Trustee or Trustees, and each successor Trustee in no way or manner
will be responsible for any action or omission to act on the part of
any previous Trustee.
Any corporation which results from any merger, consolidation or
purchase to which the Trustee may be a party, or which succeeds to the
trust business of the Trustee, or to which substantially all the trust
assets of the Trustee may be transferred, will be the successor to the
Trustee hereunder without any further act or formality with like effect
as if the successor Trustee had originally been named Trustee herein;
and in any such event it will not be necessary for the Trustee or any
successor Trustee to give notice thereof to any person, and any
requirement, statutory or otherwise, that notice will be given is
hereby waived.
11.15 Appointment of Investment Manager
One or more Investment Managers may be appointed by the Plan Sponsor
(or the Plan Administrator) to exercise full investment management
authority with respect to all or a portion of the Trust assets.
Authorized payment of the fees and expenses of the Investment
Manager(s) may be made from the Trust assets. For purposes of this
agreement, any Investment Manager so appointed will, during the period
of his appointment, possess fully and absolutely those powers, rights
and duties of the Trustee (to the extent delegated by the Plan Sponsor
or the Plan Administrator) with respect to the investment or
reinvestment of that portion of the Trust assets over which the
Investment Manager has investment management authority. The Investment
Manager must be one of the following:
(a) Registered as an investment advisor under the Investment Advisors
Act of 1940;
(b) A bank, as defined in the Investment Advisors Act of 1940; or
(c) An insurance company qualified to manage, acquire, or dispose of
such Plan assets under the laws of more than one state.
Any Investment Manager will acknowledge in writing to the Plan Sponsor
or the Plan Administrator and to the Trustee that he or it is a
fiduciary with respect to the Plan. During any period of time when the
Investment Manager is so appointed and serving, and with respect to
those assets in the Plan over which the Investment Manager exercises
11-7
investment management authority, the Trustee's responsibility will be
limited to holding such assets as a custodian, providing accounting
services, disbursing benefits as authorized, and executing such
investment instructions only as directed by the Investment Manager.
The Trustee will not be responsible for any acts or omissions of the
Investment Manager. Any certificates or other instruments duly signed
by the Investment Manager (or the authorized representative of the
Investment Manager), purporting to evidence any instruction, direction
or order of the Investment Manager with respect to the investment of
those assets of the Plan over which the Investment Manager has
investment management authority, will be accepted by the Trustee as
conclusive proof thereof. The Trustee will also be fully protected in
acting in good faith upon any notice, instruction, direction, order,
certificate, opinion, letter, telegram or other document believed by
the Trustee to be genuine and from the Investment Manager (or the
authorized representative of the Investment Manager). The Trustee will
not be liable for any action taken or omitted by the Investment Manager
or for any mistakes of judgment or other action made, taken or omitted
by the Trustee in good faith upon direction of the Investment Manager.
11-8
IN WITNESS WHEREOF, this instrument has been executed by the duly authorized
and empowered officers of the Employer, this 1st day of January, 1994.
Triton Energy Corporation
By: //Robert B. Holland, III
------------------------
Robert B. Holland, III
Sr. Vice President, General Counsel
and Secretary
The Trustee agrees to continue to serve as Trustee under the terms of this
instrument.
Smith Barney Shearson Trust Company
By: _________________________________
Triton Energy Corporation
Supplemental Executive Retirement Plan
As Amended and Restated Effective
January 1, 1994
Table of Contents
Page
Article 1. . . . . . . . . . . . . . . . . . . .Definitions 1
Article 2. . . . . . . . . . . . . . . . . . .Participation 5
Article 3. . . . . . . . . . . . . . . .Retirement Benefits 6
Article 4. . . . . . . . . . . . . . . . . . Administration 7
Article 5. . . . . . . . . . . . . . . . . Other Provisions 9
The purpose of the Triton Energy Corporation Supplemental
Executive Retirement Plan (the "Plan") is to provide deferred
compensation to a select group of management and highly
compensated employees who contribute materially to the continued
growth, development and future business success of Triton Energy
Corporation (the "Corporation") and its subsidiaries, and to
provide a retirement benefit package that will assist the Corpo-
ration in attracting, retaining and motivating the best available
talent to enter its employ.
Article 1
Definitions
As used in this document, unless otherwise defined or required by
the context, the following terms have the meanings set forth in
this Article 1.
1.01 Accrued Benefit
The Accrued Benefit of any Participant who is or was em-
ployed by the Corporation at any time on or after January
1, 1994 is determined using the formula used to
compute the Participant's Normal Retirement Benefit, multi-
plied by the Participant's accrual percentage determined
according to the following schedule on the basis of the
Participant's completed Years of Service:
Years of Service Percentage of Benefit Accrued
- ---------------- ----------------------------
Less than 1 0%
1 10%
2 20%
3 30%
4 40%
5 50%
6 60%
7 70%
8 80%
9 90%
10 or More 100%
The Accrued Benefit for any other Participant is determined
based upon the provisions of the Plan in effect on the date
of the Participant's termination of employment with the
Corporation.
1.02 Average Monthly Compensation
A Participant's Average Monthly Compensation, as of a given
date, is determined by dividing the total Compensation he
received during the five (5) consecutive calendar years for
which his Compensation was highest by the number of months
during such period for which he received Compensation. No
fractional calendar years resulting from a Participant's
date of employment or date of termination will be taken
into account.
1.03 Beneficiary
Beneficiary is the person, persons, trust or other entity
designated to receive any amount payable upon the death of
a Participant.
1.04 Board of Directors
Board of Directors means the Board of Directors of the Cor-
poration.
1.05 Change in Control
Change in Control means the occurrence of any of the fol-
lowing:
(a) The consummation of:
(1) Any consolidation or merger of the Employer in
which the Employer is not the continuing or sur-
viving corporation or pursuant to which shares of
the Employer's common stock would be converted
into cash, securities or other property, other
than a merger of the Employer in which the holders
of the Employer's common stock immediately prior
to the merger have the same proportionate owner-
ship of common stock of the surviving corporation
immediately after the merger, or
(2) Any sale, lease, exchange or other transfer (ex-
cluding transfer by way of
hypothecation), in one transaction or a series of
related transactions, of all, or substantially
all, of the assets of the Employer;
(b) The shareholders of the Employer approve any plan
or proposal for the liquidation or dissolution of
the Employer;
(c) Any "person" [as such term is defined in Section
3(a)(9) or Section 13(d)(3) under the Securities
and Exchange Act of 1934] or any "group" (as such
term is used in Rule 13d-5 promulgated under the
Securities and Exchange Act of 1934), other than
the Employer or any successor of the Employer or
any Subsidiary of the
Employer or any employee benefit plan of the Employer
or any subsidiary (including such plan's trustee), be-
comes, without the prior approval of the Directors of
the Employer, a beneficial owner for purposes of Rule
13d-3 promulgated under the Securities and Exchange Act
of 1934, directly or indirectly, of securities of the
Employer representing 25% or more of the Employer's
then outstanding securities having the right to vote in
the election of Directors of the Employer; or
(d) During any period of two consecutive years, indi-
viduals who, at the beginning of such period con-
stituted the entire Board of Directors of the Em-
ployer, cease for any reason (other than death) to
constitute a majority of the Directors of the
Employer, unless the election, or the nomination for
election, by the Employer's shareholders, of each new
Director of the Employer was approved by a vote of at
least two-thirds of the Directors of the Employer then
still in office who were Directors of the Employer at
the beginning of the period.
1.06 Compensation
Compensation means the base salary subject to FICA paid by
the Corporation or any of its subsidiaries to an Eligible
Employee during the Plan Year, excluding any bonuses,
commissions, expense allowances, overtime, severance pay,
overrides, royalties, or other extraordinary compensation.
Compensation also includes any amounts of base salary which
(i) are deferred into the Triton Energy Corporation De-
ferred Compensation Plan or (ii) are not otherwise
includable in the gross income of the Employee due to Code
Section 125, 402(a)(8), 402(h) or 403(b).
1.07 Corporation
Corporation means Triton Energy Corporation.
1.08 Early Retirement Date
A Participant's Early Retirement Date is the first day of
the month that coincides with or next follows the date on
which the Participant retires prior to his Normal Retire-
ment Date but after satisfying the following requirements:
(a) Attainment of age 55; and
(b) Completion of ten Years of Service.
1.09 Effective Date
The Effective Date of the Plan is September 1, 1990. The
Effective Date of the amendments of the Plan effected by
this restatement of the Plan is January 1, 1994.
1.10 Eligible Employee
Eligible Employees are those employees of Triton Energy
Corporation who are officers and key management personnel
and who are selected by the Board of Directors to be eligi-
ble to participate in the Plan.
1.11 Employment Commencement Date
The date on which an Employee first performs an Hour of
Service for the Employer is his Employment Commencement
Date.
1.12 Monthly Social Security Benefit
Monthly Social Security Benefit means the amount of monthly
benefits which an
Employee would be entitled to receive as his "primary in-
surance amount" determined under the provisions of the
Social Security Act as in effect on the January 1st coinci-
dent with or immediately preceding the earlier of (a) his
date of retirement or termination or (b) his Normal Re-
tirement Date. Such amount will be determined assuming (a)
that he has made or will make appropriate application for
such benefit, (b) that no event occurs to delay or forfeit
any part of such benefit, (c) that if he dies or retires
(except for Disability Retirement) before his Normal Re-
tirement Date, he will continue to receive until his Normal
Retirement Date, remuneration (which would be treated as
taxable wages for purposes of the Social Security Act) at
the same rate as at the time of retirement or death, and
(d) that if he retires under the Plan on account of Dis-
ability, his Monthly Social Security Benefit, as herein
defined, will be the benefit payable if his Social Security
disability insurance benefit were to be approved at the
same time as his Disability Retirement Benefit. As used in
this Section, the term "primary insurance amount" has the
meaning ascribed to it in the federal Social Security Act,
as amended, and in effect on the affected Employee's date
of retirement, death, severance, or Normal Retirement Date,
as the case may be.
A Participant's Monthly Social Security Benefit will be
determined based upon
estimated compensation histories in accordance with the
rules in this paragraph. The pre-separation or
pre-retirement compensation history is estimated by apply-
ing a salary scale, projected backwards, to the
Participant's compensation (as defined in Section 3.03 of
Revenue Ruling 71-446) at separation or retirement. The
salary scale represents the actual change in the average
wages from year to year as used by the Social Security Ad-
ministration to determine earnings index factors for Social
Security Average Indexed Monthly Earnings.
The determination of the amount of a Participant's Monthly
Social Security Benefit will be made by the SERP Adminis-
trative Committee.
1.13 Hour of Service
An Hour of Service is each hour for which an Employee is
paid, or entitled to payment, for the performance of duties
for the Employer.
1.14 Normal Retirement Date
A Participant's Normal Retirement Date is the first day of
the month that coincides with or next follows the date on
which the Participant retires after satisfying the follow-
ing:
(a) Attainment of age 65, and
(b) Completion of ten Years of Service.
1.15 Participant
The term "Participant" means an Eligible Employee or former
Eligible Employee who is participating in the Plan and who
is or who may become eligible to receive a benefit of any
type from the Plan or whose Beneficiary may be eligible to
receive any such
benefit.
1.16 Participation Agreement
Participation Agreement means the agreement, in the form
attached hereto and made a part hereof as Exhibit A, exe-
cuted by the Corporation and the Eligible
Employee, pursuant to which, among other things, the Eligi-
ble Employee elects to become a Participant in the Plan,
and agrees to be bound by the terms and conditions thereof.
1.17 Pension Plan Offset
Pension Plan Offset means the annual amount of retirement
income commencing at age 65 which is payable to a Partici-
pant under the Triton Energy Corporation Retirement Income
Plan. For married Participants, such benefit will be in
the form of a 50% joint and survivor annuity, and for a
single Participant, in the form of a life only benefit as
determined in accordance with the assumptions and methods
set forth in the Triton
Energy Corporation Retirement Income Plan.
1.18 Plan Year
Plan Year means the fiscal year of the Corporation.
1.19 SERP Administrative Committee
The SERP Administrative Committee will mean the person or
persons appointed by the Board of Directors to administer
the Plan in accordance with Article 4.
1.20 Years of Service
Years of Service are based upon an Employee's elapsed time
of employment during which the Employee is entitled to re-
ceive Compensation. A Year of Service (including a frac-
tion thereof) will be credited for each completed 365 days
of such elapsed time which need not be consecutive. Years
of Service with any subsidiaries will be recognized if so
approved by the Board of Directors.
Article 2
Participation
2.01 Participation
The Board of Directors will, from time-to-time, select
those officers and key management personnel of the Corpora-
tion to be Eligible Employees. Any Eligible
Employee will become a Participant in the Plan by executing
a Participation Agreement.
Article 3
Retirement Benefits
3.01 Normal Retirement
Subject to provisions of Section 5.03, a Participant who
retires on his Normal Retirement Date will begin to receive
the Normal Retirement Benefit to which he is entitled.
(a) Normal Retirement Benefit
A Participant's Normal Retirement Benefit is the month-
ly pension benefit commencing on his Normal Retirement
Date payable in the Normal Benefit Form in an amount
equal to:
(1) 50% of his Average Monthly Compensation, minus
(2) The sum of his Monthly Social Security Benefit
plus his Pension Plan Offset.
(b) Normal Benefit Form
15 Years Certain - Monthly pension benefit payable for
a period of 15 years.
3.02 Early Retirement
Subject to the provisions of Section 5.03, a Participant
who retires on his Early Retirement Date will begin to re-
ceive the Early Retirement Benefit to which he is entitled.
A Participant's Early Retirement Benefit is a monthly pen-
sion benefit commencing on his Early Retirement Date equal
to his Normal Retirement Benefit, reduced by 1/2% for each
of the first 60 months and by 1/3% for each of the next 60
months that his Early Retirement Date precedes his Normal
Retirement Date.
A Participant's Early Retirement Benefit will be payable in
the Normal Benefit Form.
3.03 Other Severance of Employment
Subject to the provisions of Section 5.03, a Participant
who terminates employment for any reason (including death)
prior to his Early Retirement Date will be entitled to
receive a monthly pension benefit from the Plan. Such
monthly pension benefit will begin on the first day of the
month following the later of the Participant's termination
of employment or attainment of age 55 and will be equal to
the Participant's Accrued Benefit, reduced by 1/2% for each
of the first 60 months and by 1/3% for each of the next 60
months that the Participant's benefit commencement date
precedes his Normal Retirement Date.
This monthly pension benefit will be paid in the Normal
Benefit Form.
3.04 Pre-Retirement Death Benefit
Subject to the provisions of Section 5.03, if a Participant
dies before terminating
employment, the Participant's designated Beneficiary will
be entitled to receive the Participant's monthly pension
benefit determined in accordance with Sections 1.01, 3.02
or 3.03 above as if the Participant had terminated employ-
ment on the day before he died.
If the Participant had not attained age 55 at the time of
his death, he will be treated as having attained age 55 and
retired on the day before his death. The death of a Par-
ticipant will not cause an acceleration in accrual.
The benefits will be payable in the Normal Benefit Form and
will commence on the first day of the month following the
Participant's date of death.
3.05 Reemployment
If a Participant (a) terminates employment, (b) receives a
distribution of all or a portion of his Accrued Benefit and
(c) is later reemployed, the Participant's Normal Retire-
ment Benefit (and therefore his Accrued Benefit) will be
reduced by the actuarial equivalent value of the benefit
which was previously distributed using the definition of
actuarial equivalence as set forth in the first paragraph
of Section 1.02 of the Triton Energy
Retirement Income Plan.
Article 4
Administration
4.01 SERP Administrative Committee
(a) The Board of Directors will appoint a SERP Admin-
istrative Committee consisting of one or more per-
sons and may increase or decrease the number of
persons serving on the SERP Administrative Commit-
tee at any time and from time to time. Any member
of the SERP Administrative Committee may resign
upon ten days prior to written notice to the Board
of Directors. The Board of Directors may remove
any such member at any time by notifying such per-
son in writing and may appoint a successor.
(b) The SERP Administrative Committee will be respon-
sible for the management, operation and adminis-
tration of the Plan. The SERP Administrative Com-
mittee will have all powers necessary to adminis-
ter the Plan in accordance with its terms. The
SERP Administrative Committee will have the power,
exercisable as its sole and absolute discretion,
to construe the Plan and determine all questions
that may arise thereunder and to establish rules,
forms and procedures for the administration of the
Plan. In addition, the SERP Administrative Com-
mittee will establish and maintain a claims proce-
dure similar to that set forth in Section 503 of
the
Employee Retirement Income Security Act of 1974 and the
regulations thereunder.
(c) The SERP Administrative Committee may engage or
appoint such assistants or representatives as it
deems necessary for the effective exercise of its
duties in
administering the Plan. The SERP Administrative Com-
mittee may delegate to such assistants and representa-
tives any powers and duties, both ministerial and dis-
cretionary, as seem expedient or appropriate. The SERP
Administrative Committee also may engage accountants,
actuaries, attorneys, and such other personnel as it
deems necessary or advisable.
(d) All actions of the SERP Administrative Committee
will require the consent of a majority of the then
members of the SERP Administrative Committee. All
actions taken by the SERP Administrative Committee
will be final, conclusive and binding on all par-
ties.
(e) In the event the SERP Administrative Committee
exercises any discretionary
authority under the Plan with respect to a Participant
who is a member of the SERP Administrative Committee,
such discretionary authority will be exercised solely
and exclusively by those members of the SERP Adminis-
trative Committee other than the Participant. In the
event the remaining members of the SERP Administrative
Committee cannot reach a majority conclusion, or, if
such Participant is the sole member of the SERP Admin-
istrative Committee, the Board of Directors of the Cor-
poration will appoint a temporary substitute SERP Ad-
ministrative Committee member to exercise all the pow-
ers of a qualified SERP Administrative Committee member
concerning the matter in which such Participant cannot
so act or for which there is a deadlock.
4.02 Costs and Expenses
All costs and expenses with respect to the adoption, imple-
mentation, interpretation, and administration of the Plan
will be borne by the Corporation.
4.03 Liability of SERP Administrative Committee
Unless resulting from his own fraud or willful misconduct,
no member of the SERP Administrative Committee will be lia-
ble for any loss arising out of any action taken or failure
to act by the SERP Administrative Committee or a member
thereof in connection with this Plan. The SERP Administra-
tive Committee and any individual member of the SERP Admin-
istrative Committee and any agent thereof will be fully
protected in relying upon the advice of professional con-
sultants or advisers employed by the Employer or the SERP
Administrative Committee.
4.04 Indemnification
The Employers hereby jointly and severally indemnify and
agree to hold harmless the members of the SERP Administra-
tive Committee and all directors, officers and
employees of an Employer against any loss, claim, cost,
expense (including attorneys' fees), judgment or liability
arising out of any action taken or failure to act by the
SERP Administrative Committee or such individual in connec-
tion with this Plan; provided, however, that this indemnity
will not apply to an individual if such loss, claim, cost,
expense, judgment, or liability is due to such individual's
fraud or willful misconduct.
Article 5
Other Provisions
5.01 Construction
This Plan will be construed in accordance with and governed
by the laws of the State of Texas. Words used in the sin-
gular will include the plural, the masculine gender will
include the feminine, and vice versa, whenever appropriate.
5.02 Acceleration of Accrual Upon Change in Control
In the event of a Change in Control of the Corporation,
notwithstanding any other provision in the Plan to the con-
trary, those Participants who are employed by the Corpora-
tion on the date of the Change in Control will become fully
accrued notwithstanding the accrual schedule in Section
1.01, and the Corporation may fully fund in trust its obli-
gations hereunder.
The benefits payable to a Participant under Article 3 will
be distributed to the Participant in a single lump-sum pay-
ment within ninety (90) days of the date of the
Participant's termination of employment following a Change
in Control. Such single lump sum value will be computed
using the definition of actuarial equivalence as set forth
in the first paragraph of Section 1.02 of the Triton Energy
Corporation Retirement Income Plan and will be based upon
the assumption that the Participant had completed at least
10 Years of Service prior to his termination of employment.
In no event may the SERP Administrative Committee change
the discount rate to adversely affect any rights or bene-
fits of a Participant on or after the occurrence of a
Change in Control.
5.03 Forfeiture of Benefits Under the Plan
(a) Notwithstanding any other provisions of this Plan,
in the event any Participant's employment with the
Corporation or any of its subsidiaries is termi-
nated for cause (as herein defined), such Partici-
pant or his Beneficiary will not be entitled to
receive any benefits under this Plan.
(b) Termination for cause as used in Section 5.03
above will mean termination of
employment for:
(1) Proven or admitted dishonest acts against the Cor-
poration or any of its subsidiaries which substan-
tially injures the Corporation or any of its sub-
sidiaries or the Participant's fellow employees;
or
(2) Conviction for a felony or crime of moral turpi-
tude.
(c) In the event any Participant terminates employment
with the Corporation or any of its subsidiaries
for any reason, neither such Participant nor his
or her Beneficiary will be entitled to receive any
further benefits under this Plan if, at any time
within the two-year period following such termina-
tion, such Participant:
(1) Communicates or divulges, to or for the benefit of
any competitor or rival of the Corporation, any of
the trade secrets or advertising processes used by
the Corporation or any of its subsidiaries;
(2) Reveals, divulges or makes known, directly or in-
directly, to any person or entity, the name or any
other information concerning any client, customer
or account of the Corporation or any of its sub-
sidiaries, or any details concerning the relation-
ship between the Corporation or any of its subsid-
iaries and such clients, customers and accounts;
or
(3) Reveals, divulges or makes known, directly or in-
directly, to any person or
entity any information concerning any prospective
client, customer or
account of the Corporation or any of its subsid-
iaries, or any details
concerning the relationship between the Corpora-
tion or any of its
subsidiaries any such prospective clients, custom-
ers and accounts which would interfere with such
relationship.
For purposes of this Section 5.03(c), the term
"prospective client" will mean any individual,
association, firm, corporation, organization, or
other entity whose advertising business has been
solicited by the Corporation or any of its subsid-
iaries at any time within one (1) year preceding
the Participant's date of employment termination.
5.04 Source of Payment of Benefits
The Corporation will pay all benefits owing under this Plan
out of its general assets, and no Participant or Beneficia-
ry will have any claim or right to any particular assets of
the Corporation as a result of participation in this Plan.
Each Participant is an unsecured creditor of the Corpora-
tion with no greater rights than any other general unse-
cured creditor of the Corporation. The Plan is totally
unfunded and represents only the Corporation's unsecured
promise to pay benefits as provided hereunder. The Corpo-
ration may, but will not be obligated to, purchase one or
more life insurance or annuity policies or contracts for
the purpose of providing for its obligations hereunder.
Any such policies or contracts, if so purchased, will name
the Corporation as beneficiary and sole owner, with all
incidents of ownership therein, including (but not limited
to) the right to cash and loan values, dividends (if any),
death benefits, and the right of termination thereof. Any
such policies or contracts that may be purchased hereunder
will
remain a general unrestricted asset of the Corporation.
Neither the Participant nor any Beneficiary will have any
rights with respect to, or claim against, any such policy
or contract, and such policy or contract will not be deemed
to be held in trust for the benefit of any Participant or
any Beneficiary.
5.05 Employment Rights of Parties Not Restricted
The adoption and maintenance of this Plan will not be
deemed a contract between the Employer and any Employee.
Nothing in this Plan will give any Employee or Participant
the right to be retained in the employ of the Employer or
to interfere with the right of the Employer to discharge
any Employee or Participant at any time, nor will it give
the Employer the right to require any Employee or Partici-
pant to remain in its employ, or to interfere with any
Employee's or Participant's right to terminate his employ-
ment at any time.
5.06 Designation of Beneficiary
Each Participant will be given the opportunity to designate
a Beneficiary or Beneficiaries, and, from time-to-time, the
Participant may file with the SERP Administrative Committee
a new or revised designation on the form provided by the
SERP Administrative Committee. If a Participant is mar-
ried, the Participant's spouse will be the Participant's
designated Beneficiary.
If a Participant dies without designating a Beneficiary, or
if the Participant is predeceased by all designated Benefi-
ciaries, the SERP Administrative Committee will distribute
to the Participant's estate all benefits that are payable
in the event of the Participant's death.
5.07 Amendment or Termination of the Plan
The Plan and any Participation Agreement may be altered,
amended, suspended, or
terminated in whole or in part, at any time and from time-
to-time, by the Board of
Directors, in its sole discretion, upon 30 days' prior
written notice delivered to each Participant affected by
any such action, but no such action will adversely affect
or alter any accrued benefit, right or obligation with re-
spect to any Participant who has terminated, retired or
died and who has become entitled to or has commenced to
receive benefits hereunder.
5.08 Alienation
No person entitled to any benefit under this Plan will have
any right to sell, assign, transfer, hypothecate, encumber,
commute, pledge, anticipate, or otherwise dispose of his
interest in the benefit, and any attempt to do so will be
void. No benefit under this Plan will be subject to any
legal process, levy, execution, attachment, or garnishment
for the payment of any claim against such person.
5.09 Distribution in the Event Participation Is Disallowed
Notwithstanding any provision herein to the contrary, in
the event the SERP Administrative Committee, in its sole
discretion, determines that the participation of any Par-
ticipant in this Plan may cause this Plan to fail to be
exempt from the requirements of Parts 2, 3, and 4 of Subti-
tle B of Title I of ERISA as an unfunded plan of deferred
compensation for a select group of management or highly
compensated employees, such Participant will cease to be a
Participant in this Plan as of the date such determination
is made by the SERP Administrative Committee, and as soon
as administratively practicable the single-sum value of the
benefit that he has accrued as of the date of such determi-
nation under this Plan will be paid to such Participant (or
to his beneficiary or beneficiaries in the event of his
death) in a single-cash payment in lieu of and in full sat-
isfaction of all of his rights and interests under this
Plan. Such single-sum value will be computed using the
definition of actuarial equivalence as set forth in the
first paragraph of Section 1.02 of the Triton Energy Re-
tirement Income Plan.
5.10 Binding on Employer, Employees, and Their Successors
This Plan will be binding upon and inure to the benefit of
the Company and to any other Employer participating in this
Plan, their successors and assigns, and the employee and
his heirs, executors, administrators, and duly appointed
legal representatives.
EXECUTED this ________ day of ___________________, 1994, effec-
tive as of January 1, 1994.
Triton Energy Corporation
By: // Robert B. Holland, III
---------------------------
Robert B. Holland, III
Sr. Vice President, General Counsel
and Secretary
AMENDMENT NO. 3 TO THE
1981 EMPLOYEE NONQUALIFIED
STOCK OPTION PLAN
OF
TRITON ENERGY CORPORATION
WHEREAS, Triton Energy Corporation (the "Corporation") adopted
the 1981 Employee Nonqualified Stock Option Plan of Triton
Energy Corporation (the "1981 Plan") on April 9, 1981; and
WHEREAS, Section 13 of the 1981 Plan authorizes the Board of
Directors of the Corporation to amend the 1981 Plan; and
WHEREAS, the 1981 Plan was amended by action of the Board of
Directors of the Corporation effective December 30, 1981 and
April 16, 1992; and
WHEREAS, the Board of Directors deems it advisable and in the
best interest of the Corporation to further amend the 1981 Plan,
to clarify certain provisions thereof;
NOW, THEREFORE, the Board of Directors hereby amends the 1981
Plan, as follows:
I.
Section 8 of the 1981 Plan is amended to read as follows:
"8. ACCELERATION UPON CHANGE OF CONTROL.
In the event of a Change in Control of the Company, then,
notwithstanding any other provision in the Plan to the contrary,
all unmatured installments of options outstanding shall
thereupon automatically be accelerated and exercisable in full.
As used herein, the term "Change in Control" shall mean the
occurrence of any of the following events: (i) there shall be
consummated (x) any consolidation or merger of the Company in
which the Company is not the continuing or surviving corporation
or pursuant to which shares of the Company's Common Stock would
be converted into cash, securities or other property, other than
a merger of the Company in which the holders of the Company's
Common Stock immediately prior to the merger have the same
proportionate ownership of common stock of the surviving
corporation immediately after the merger, or (y) any sale,
lease, exchange or other transfer (excluding transfer by way of
pledge or hypothecation), in one transaction or a series of
related transactions, of all, or substantially all, of the
assets of the Company, (ii) the shareholders of the Company
approve any plan or proposal for the liquidation or dissolution
of the Company, (iii) any "person" (as such term is defined in
Section 3(a)(9) or Section 13(d)(3) under the Securities
Exchange 1934 Act of 1934, as amended (the "Exchange Act")) or
any "group" (as such term is used in Rule 13d-5 promulgated
under the Exchange Act), other than the Company or any successor
of the Company or any Subsidiary of the Company or any employee
benefit plan of the Company or any Subsidiary (including such
plan's trustee), becomes, without the prior approval of the
Board, a beneficial owner for purposes of Rule 13d-3 promulgated
under the Exchange Act, directly or indirectly, of securities of
the Company representing 25.0% or more of the Company's then
outstanding securities having the right to vote in the election
of directors of the Company, or (iv) during any period of two
consecutive years, individuals who, at the beginning of such
period constituted the entire Board, cease for any reason (other
than death) to constitute a majority of the directors of the
Company, unless the election, or the nomination for election, by
the Company's shareholders, of each new director of the Company
was approved by a vote of at least two-thirds of the directors
of the Company then still in office who were directors of the
Company at the beginning of the period."
IN WITNESS WHEREOF, the Corporation has caused this instrument
to be executed as of the _____ day of ____________, 1994.
TRITON ENERGY CORPORATION
By: // Robert B. Holland, III
---------------------------
Robert B. Holland, III
Sr. Vice President, General Counsel
and Secretary
Attest:
// Tamera D. Gibson
- ---------------------------------
Tamera D. Gibson, Asst. Secretary
AMENDMENT NO. 2 TO THE
1985 STOCK OPTION PLAN
OF
TRITON ENERGY CORPORATION
WHEREAS, Triton Energy Corporation (the "Corporation") adopted
the 1985 Employee Nonqualified Stock Option Plan of Triton
Energy Corporation (the "1985 Plan") on November 13, 1984; and
WHEREAS, Section 13 of the 1985 Plan authorizes the Board of
Directors of the Corporation to amend the 1985 Plan; and
WHEREAS, the 1985 Plan was amended by action of the Board of
Directors of the Corporation effective April 16, 1992; and
WHEREAS, the Board of Directors deems it advisable and in the
best interest of the Corporation to further amend the 1985 Plan,
to clarify certain provisions thereof;
NOW, THEREFORE, the Board of Directors hereby amends the 1985
Plan, as follows:
I.
Section 8 of the 1985 Plan is amended to read as follows:
"8. ACCELERATION UPON CHANGE OF CONTROL.
In the event of a Change in Control of the Company, then,
notwithstanding any other provision in the Plan to the contrary,
all unmatured installments of options outstanding shall
thereupon automatically be accelerated and exercisable in full.
As used herein, the term "Change in Control" shall mean the
occurrence of any of the following events: (i) there shall be
consummated (x) any consolidation or merger of the Company in
which the Company is not the continuing or surviving corporation
or pursuant to which shares of the Company's Common Stock would
be converted into cash, securities or other property, other than
a merger of the Company in which the holders of the Company's
Common Stock immediately prior to the merger have the same
proportionate ownership of common stock of the surviving
corporation immediately after the merger, or (y) any sale,
lease, exchange or other transfer (excluding transfer by way of
pledge or hypothecation), in one transaction or a series of
related transactions, of all, or substantially all, of the
assets of the Company, (ii) the shareholders of the Company
approve any plan or proposal for the liquidation or dissolution
of the Company, (iii) any "person" (as such term is defined in
Section 3(a)(9) or Section 13(d)(3) under the Securities
Exchange Act of 1934, as amended (the "Exchange Act")) or any
"group" (as such term is used in Rule 13d-5 promulgated under
the Exchange Act), other than the Company or any successor of
the Company or any Subsidiary of the Company or any employee
benefit plan of the Company or any Subsidiary (including such
plan's trustee), becomes, without the prior approval of the
Board, a beneficial owner for purposes of Rule 13d-3 promulgated
under the Exchange Act, directly or indirectly, of securities of
the Company representing 25.0% or more of the Company's then
outstanding securities having the right to vote in the election
of directors of the Company, or (iv) during any period of two
consecutive years, individuals who, at the beginning of such
period constituted the entire Board, cease for any reason (other
than death) to constitute a majority of the directors of the
Company, unless the election, or the nomination for election, by
the Company's shareholders, of each new director of the Company
was approved by a vote of at least two-thirds of the directors
of the Company then still in office who were directors of the
Company at the beginning of the period."
IN WITNESS WHEREOF, the Corporation has caused this instrument
to be executed as of the _____ day of ____________, 1994.
TRITON ENERGY CORPORATION
By: // Robert B. Holland, III
----------------------------
Robert B. Holland, III
Sr. Vice President, General Counsel
and Secretary
Attest:
// Tamera D. Gibson
------------------------------
Tamera D. Gibson, Asst. Secretary
TRITON ENERGY CORPORATION
AMENDED AND RESTATED
1986 CONVERTIBLE DEBENTURE PLAN
1. Purpose. This plan, which will be known as the Triton
Energy Corporation Amended and Restated 1986 Convertible
Debenture Plan (the "Plan"), is intended to promote the
interests of Triton Energy Corporation (the "Company") and its
stockholders by allowing certain senior key executives
(including directors who are employees) and consultants
(individually, a "Purchaser" and collectively, the "Purchasers")
of the Company and its subsidiaries the opportunity to acquire
an equity interest in the Company by means of investing in the
Company's variable interest rate subordinated Debentures (the
"Debentures") which are convertible into shares of common stock
of the Company (the "Common Stock"), thereby giving such senior
key executives and consultants added incentive to work toward
the continued growth and success of the Company. The Company's
Board of Directors (the "Board") also contemplates that the Plan
will enable the Company and its subsidiaries to continue to
compete effectively for the services of management personnel
needed for the continued growth and success of the Company.
2. Administration. The Plan shall be administered by the
Compensation Committee of the Board (the "Committee"), which
shall consist of not fewer than three members, each of whom
shall qualify as a "disinterested person" within the meaning of
Rule 16b-3 ("Rule 16b-3"), under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), if and as such Rule is
then in effect. Debentures may not be sold to any member of the
Committee during the term of his membership on the Committee.
Subject to the provisions of the Plan and to the provisions of
an Indenture, the Committee shall interpret the Plan and the
Debentures sold under the Plan, shall make such rules as it
deems necessary for the proper administration of the Plan, shall
make all other determinations necessary or advisable for the
administration of the Plan and shall correct any defect or
supply any omission or reconcile any inconsistency in the Plan
or in the Debentures in the manner and to the extent the
Committee deems desirable to administer the Plan or the
Debentures.
With respect to persons subject to Section 16 of the Exchange
Act, transactions under the Plan are intended to comply with all
applicable conditions of Rule 16b-3 or its successors under the
Exchange Act. To the extent that any provision of the Plan or
action by the Committee fails to so comply, it shall be deemed
null and void, to the extent permitted by law and deemed
advisable by the Committee.
3. Issuance of the Debentures. The Debentures are to be issued
pursuant to an Indenture and any supplemental Indenture thereto
(collectively, an "Indenture"). The Debentures are to be issued
in series; each series may be issued under a separate Indenture,
or two or more series may be issued under a single Indenture.
Each series will be due not earlier than seven years from the
date of issuance, or such earlier date as the Company redeems a
series of Debentures or prepays an individual Debenture (with
respect to such series or individual Debenture, the "Due Date").
The Committee may extend the term of a series for any period of
time from seven years up to ten years as determined by the
Committee without shareholder approval, as set forth in the
Indenture for that series. The Debentures shall be issuable in
such form and denominations as the Committee may from time to
time approve.
4. General Terms and Conditions of the Debentures. The
Debentures will be convertible into fully paid and nonassessable
shares of Common Stock of the Company at any time after a date
set by the Committee (the "Conversion Date") from the date of
issuance until the close of business on the Due Date, at the
conversion price in effect at the time of conversion.
Individual Debentures may have Conversion Dates which vary from
one to three years from the date of issuance. The Committee may
at any time, or from time to time, accelerate (but not delay)
the Conversion Date.
If a Purchaser's employment or association with the Company is
terminated for any reason other than death, disability,
retirement or for cause, the Purchaser's Debenture may be
converted (to the extent convertible on the date of such
termination or, if the Committee, in its discretion, has
accelerated the Conversion Date, to the extent convertible
following such acceleration) at any time within three months
after such termination, unless the Committee agrees, in its sole
discretion, to further extend the Conversion Date of such
Debenture; provided that the term of any such Debenture shall
not be extended beyond its initial term. If a Purchaser's
employment or association with the Company is terminated due to
death, disability or retirement, the Purchaser's Debenture may
be converted (to the extent convertible on the date of death,
disability or retirement or, if the convertibility of such
Debenture has been accelerated, to the extent convertible
following such acceleration) at any time within one year from
the date of termination, unless the Committee agrees, in its
sole discretion, to further extend the Conversion Date of such
Debenture; provided that the term of any Debenture shall not be
extended beyond its initial term. If the Purchaser is
discharged from the Company for cause, he may not convert the
Debenture after discharge. The Company will prepay any
Debenture, the conversion privilege of which so terminates.
The Committee may, in its discretion, agree that Debentures are
transferable by the Purchaser to members of his immediately
family (i.e., parents, children, grandchildren or spouse),
trusts for the benefit of such immediate family members and
partnerships in which such immediate family members are the only
partners, provided that there cannot be any consideration for
the transfer.
Except as may be agreed upon by the Committee in accordance
with the immediately preceding paragraph, a Debenture may not be
sold, assigned, transferred, pledged (except as provided below)
or otherwise hypothecated other than (i) by will or the laws of
descent and distribution or (ii) pursuant to the terms of a
qualified domestic relations order as defined by the Internal
Revenue Code of 1986, as amended (the "Code"), or Title I of the
Employee Retirement Income Security Act of 1974 as amended.
Notwithstanding the provisions of the previous two paragraphs,
in certain cases Purchasers may pledge Debentures as security
for loans which will provide all or part of the financing
necessary to purchase the Debentures, and such pledges may be
made without the Company's consent by providing the Company with
written notice of the pledge. The conversion right of any
Debenture shall be exercisable only by the Purchaser, his estate
or the beneficiaries of such estate.
If a Purchaser pledges a Debenture in the permitted manner
described above, the conversion privilege will not be
exercisable during such time as the Debenture is pledged. Upon
notice from the Purchaser and the lender to which the Debenture
was pledged that the obligation has been discharged, the
conversion privilege will again be exercisable. If a Purchaser
sells, assigns, transfers, pledges (except pledges requiring
only written notice to the Company) or otherwise hypothecates a
Debenture without the Company's consent, the conversion right
will permanently cease to exist. Should the conversion right of
a Debenture so terminate, the Company has the option, but not
the obligation, to prepay that Debenture.
5. Authorized Amount of Debentures. The Company may issue an
unlimited aggregate principal amount of all Debentures;
provided, however, that the number of shares of Common Stock
into which such Debentures may be converted shall not exceed
1,000,000 shares (subject to appropriate adjustment in the event
of stock dividends, split-ups, recapitalizations, combinations,
exchanges of shares or the like).
6. Effective Date. The Plan, as originally adopted, became
effective as of November 6, 1986, subject to approval by the
holders of a majority of the shares of voting stock of the
Company represented at the Annual Meeting of Shareholders of the
Company held during 1986. The Plan, as amended and restated, is
subject to approval by the holders of a majority of the shares
of voting stock of the Company represented at the Annual Meeting
of Shareholders of the Company to be held during 1993, and shall
expire when all of the Company's obligations with respect to all
of the outstanding Debentures have been discharged.
7. Eligible Employees. The Committee shall have authority to
sell Debentures to senior key executives (which may include
directors who are employees) of and consultants to the Company
or any subsidiary of the Company who have a material and direct
effect upon the Company's operations as may be selected by the
Committee. As used in the Plan, (i) the term "subsidiary" shall
have the meaning ascribed to it in Section 424 of the Code and
(ii) the term "consultant" shall mean any person performing
services for the Company or any subsidiary of the Company, with
or without compensation, to whom the Committee chooses to sell
Debentures in accordance with the Plan, provided that bona fide
services must be rendered by such person and such services shall
not be rendered in connection with the offer or sale of
securities in a capital-rasing transaction.
8. Sales Price of Debentures. The Debentures shall be sold by
the Company at face value plus any accrued interest to the date
of sale. The Committee shall make a good faith determination
that the fair value of a Debenture at the time of sale is equal
to its face value. In the event that the Internal Revenue
Service determines that the value of a Debenture at the time of
sale exceeded its face value and if (a) the Company receives a
tax benefit as a result of that determination and (b) the
Purchaser is taxed to the extent of the excess, then the Company
will pay to the Purchaser as compensation the lesser of the
Company's tax benefit with respect to the Purchaser or the
Purchaser's tax liability resulting from such determination,
provided the Purchaser has contested the imposition of such
liability in a manner which the Company determines to be
appropriate under the circumstances.
9. Conversion Price. The price at which shares of Common Stock
shall be delivered upon conversion of a series of Debentures
(the "conversion price") shall be set by the Committee (and
thereafter adjusted as provided in the Indenture); provided,
however, that the conversion price shall not be less than 100%
of the last reported sales price of the Company's Common Stock
on the date prior to the date the Committee authorizes the
issuance of such series of Debentures, as shown on the New York
Stock Exchange Composite Transactions.
10. Amendment and Discontinuance. The Committee may amend,
suspend or terminate the Plan; provided, however, that no
amendment, suspension or termination of the Plan may, without
the consent of the holder of a Debenture, terminate his
Debenture or adversely affect his rights under the Debenture in
any material respect.
11. Delivery of Promissory Notes in Payment of Debentures. The
Committee may authorize Purchasers to purchase Debentures by
delivery of a promissory note to the Company in payment of all
or a part of the purchase price of the Debentures. Such
promissory notes shall provide for full recourse against the
Purchaser and shall have provisions for collateral, which may
include the Debentures, payment of interest, repayment of
principal and such other terms and conditions as the Committee
deems advisable.
12. Other Provisions.
12.1 The Purchaser of a Debenture shall not be entitled to
any rights as a stockholder of the Company until such Purchaser
has exercised the conversion privilege contained in the
Debenture.
12.2 No Debenture shall be construed as limiting any right
which the Company or any subsidiary of the Company may have to
terminate at any time, with or without cause, the employment of
a Purchaser to whom a Debenture has been sold.
12.3 Notwithstanding any provision of the Plan, the Indenture
or the terms of any Debenture sold pursuant to the Plan, (i) the
Company shall not be required to issue any Debentures hereunder
if such issuance would, in the judgment of the Board or the
Committee, constitute a violation of any state or Federal Law,
or of the rules or regulations of any governmental regulatory
body and (ii) any amount of interest paid or payable on a
Debenture which exceeds the amount legally payable to a
Purchaser under the applicable usury laws will be paid by the
Company as compensation to the Purchaser.
12.4 Each Debenture purchased under this Plan shall be
granted on the condition that the purchase of said Debenture and
the conversion thereof into Common Stock of the Company by the
holder of said Debenture shall be for the investment purposes
and not with a view to resale or distribution. The Company may
require the Debentures and any shares of the Company's Common
Stock received upon conversion thereof to bear such restrictive
legends as the Company and its counsel deem appropriate.
12.5 The Company will not voluntarily claim the benefit of
any usury law against Debentureholders and will resist any
effort to compel it to do so.
13. Registration of Common Stock. The Company shall use its
best efforts to register the offering of the Common Stock
issuable upon conversion of the Debentures pursuant to the
Securities Act of 1933, as amended, and appropriate state blue
sky laws prior to the time the Debentures become convertible
into Common Stock.
IN WITNESS WHEREOF, the Company has caused this instrument to
be executed as of the _______ day of ____________, 1994.
TRITON ENERGY CORPORATION
By: // Robert B. Holland, III
----------------------------
Robert B. Holland, III
Sr. Vice President, General Counsel
and Secretary
ATTEST:
// Tamera D. Gibson
- ---------------------------------
Tamera D. Gibson, Asst. Secretary
AMENDMENT NO. 2 TO THE
1989 STOCK OPTION PLAN
OF
TRITON ENERGY CORPORATION
WHEREAS, Triton Energy Corporation (the "Corporation") adopted
the 1989 Stock Option Plan of Triton Energy Corporation (the
"1989 Plan") on November 10, 1988; and
WHEREAS, Section 12 of the 1989 Plan authorizes the Board of
Directors of the Corporation to amend the 1989 Plan; and
WHEREAS, the 1989 Plan was amended by action of the Board of
Directors of the Corporation on April 16, 1992; and
WHEREAS, the Board of Directors deems it advisable and in the
best interest of the Corporation to further amend the 1989 Plan,
to clarify certain provisions thereof;
NOW, THEREFORE, the Board of Directors hereby amends the 1989
Plan, as follows:
I.
Paragraph 1 of Section 2 of the 1989 Plan is amended in its
entirety to read as follows:
"The Plan shall be administered by the Board of Directors of
the Company (the "Board"), a majority of the members of which
are "disinterested persons." The Board may delegate, at any
time and from time to time, any or all of its authority under
the Plan to a committee of three or more directors appointed by
the Board, all of whom are "disinterested persons." As used in
this Plan, a director shall be deemed a "disinterested person"
if he qualifies as a "disinterested person" under Rule 16b-3 of
the Securities Exchange Act of 1934, as amended (the "Exchange
Act)."
II.
Section 8 of the 1989 Plan is amended in its entirety to read
as follows:
"8. Change of Control.
In the event of a Change in Control of the Company, then,
notwithstanding any other provision in the Plan to the contrary,
all unmatured installments of options outstanding shall
thereupon automatically be accelerated and exercisable in full.
As used herein, the term "Change in Control" shall mean the
occurrence of any of the following events: (i) there shall be
consummated (x) any consolidation or merger of the Company in
which the Company is not the continuing or surviving corporation
or pursuant to which shares of the Company's Common Stock would
be converted into cash, securities or other property, other than
a merger of the Company in which the holders of the Company's
Common Stock immediately prior to the merger have the same
proportionate ownership of common stock of the surviving
corporation immediately after the merger, or (y) any sale,
lease, exchange or other transfer (excluding transfer by way of
pledge or hypothecation), in one transaction or a series of
related transactions, of all, or substantially all, of the
assets of the Company, (ii) the shareholders of the Company
approve any plan or proposal for the liquidation or dissolution
of the Company, (iii) any "person" (as such term is defined in
Section 3(a)(9) or Section 13(d)(3) under the Exchange Act) or
any "group" (as such term is used in Rule 13d-5 promulgated
under the Exchange Act), other than the Company or any successor
of the Company or any Subsidiary of the Company or any employee
benefit plan of the Company or any Subsidiary (including such
plan's trustee), becomes, without the prior approval of the
Board, a beneficial owner for purposes of Rule 13d-3 promulgated
under the Exchange Act, directly or indirectly, of securities of
the Company representing 25.0% or more of the Company's then
outstanding securities having the right to vote in the election
of directors of the Company, or (iv) during any period of two
consecutive years, individuals who, at the beginning of such
period constituted the entire Board, cease for any reason (other
than death) to constitute a majority of the directors of the
Company, unless the election, or the nomination for election, by
the Company's shareholders, of each new director of the Company
was approved by a vote of at least two-thirds of the directors
of the Company then still in office who were directors of the
Company at the beginning of the period."
IN WITNESS WHEREOF, the Corporation has caused this instrument
to be executed as of the _____ day of ____________, 1994.
TRITON ENERGY CORPORATION
By: // Robert B. Holland, III
------------------------------
Robert B. Holland, III
Sr. Vice President, General Counsel
and Secretary
Attest:
// Tamera D. Gibson
Tamera D. Gibson, Asst. Secretary
TRITON ENERGY CORPORATION
AMENDED AND RESTATED
1992 STOCK OPTION PLAN
Purpose
The purpose of the Plan is to help the Company and its
Subsidiaries attract and retain Employees, Directors and
Advisors and to provide such persons with a proprietary interest
in the Company through the granting of Incentive Stock Options
and Nonqualified Stock Options which will:
(a) increase the interest of the Employees, Directors and
Advisors in the Company's welfare;
(b) furnish an incentive to the Employees, Directors and
Advisors to continue their services for the Company or its
Subsidiaries; and
(c) provide a means through which the Company or its
Subsidiaries may attract able persons to enter its employ or
serve as Directors or Advisors.
With respect to persons subject to Section 16 of the 1934 Act,
transactions under the Plan are intended to comply with all
applicable conditions of Rule 16b-3 or its successors under the
1934 Act. To the extent that any provision of the Plan or
action by the Committee fails to so comply, it shall be deemed
null and void, to the extent permitted by law and deemed
advisable by the Committee.
ARTICLE I
Definitions
For the purpose of this Plan, unless the context requires
otherwise, the following terms shall have the meanings indicated:
1.1 "Advisor" means any person performing services for the
Company or any Subsidiary of the Company, with or without
compensation, to whom the Company chooses to grant Stock Options
in accordance with the Plan, provided that bona fide services
must be rendered by such person and such services shall not be
rendered in connection with the offer or sale of securities in a
capital-raising transaction.
1.2 "Board" means the board of directors of the Company.
1.3 "Cause" means an act or acts involving a felony, fraud,
willful misconduct, the commission of any act that causes or
reasonably may be expected to cause substantial injury to the
Company, or other good cause. The term "other good cause" shall
include, but shall not be limited to, habitual impertinence, a
pattern of conduct that tends to hold the Company up to ridicule
in the community, conduct disloyal to the Company, conviction of
any crime of moral turpitude, and substantial dependence, as
judged by the Committee, on alcohol or any controlled substance.
1.4 "Change in Control" means the occurrence of any of the
following events: (i) there shall be consummated (x) any
consolidation or merger of the Company in which the Company is
not the continuing or surviving corporation or pursuant to which
shares of the Company's Common Stock would be converted into
cash, securities or other property, other than a merger of the
Company in which the holders of the Company's Common Stock
immediately prior to the merger have the same proportionate
ownership of common stock of the surviving corporation
immediately after the merger, or (y) any sale, lease, exchange
or other transfer (excluding transfer by way of pledge or
hypothecation), in one transaction or a series of related
transactions, of all, or substantially all, of the assets of the
Company, (ii) the shareholders of the Company approve any plan
or proposal for the liquidation or dissolution of the Company,
(iii) any "person" (as such term is defined in Section 3(a)(9)
or Section 13(d)(3) under the 1934 Act) or any "group" (as such
term is used in Rule 13d-5 promulgated under the 1934 Act),
other than the Company or any successor of the Company or any
Subsidiary of the Company or any employee benefit plan of the
Company or any Subsidiary (including such plan's trustee),
becomes, without the prior approval of the Board, a beneficial
owner for purposes of Rule 13d-3 promulgated under the 1934 Act,
directly or indirectly, of securities of the Company
representing 25.0% or more of the Company's then outstanding
securities having the right to vote in the election of Directors
of the Company, or (iv) during any period of two consecutive
years, individuals who, at the beginning of such period
constituted the entire Board, cease for any reason (other than
death) to constitute a majority of the Directors of the Company,
unless the election, or the nomination for election, by the
Company's shareholders, of each new Director of the Company was
approved by a vote of at least two-thirds of the Directors of
the Company then still in office who were Directors of the
Company at the beginning of the period.
1.5 "Code" means the Internal Revenue Code of 1986, as amended.
1.6 "Committee" means the Committee appointed in accordance
with Article II. Provided that the requirements set forth in
Article II are met, the Compensation Committee of the Board may
serve as the Committee.
1.7 "Common Stock" means the common stock which the Company is
currently authorized to issue or may in the future be authorized
to issue.
1.8 "Company" means Triton Energy Corporation, a Texas
corporation.
1.9 "Controlled substance" means a drug, immediate precursor,
or other substance listed in Schedules I-V of the Federal
Comprehensive Drug Abuse Prevention and Control Act of 1970, as
amended.
1.10 "Date of Grant" means the effective date on which a Stock
Option is awarded to an Employee, Director or Advisor as set
forth in the Stock Option Agreement.
1.11 "Director" means a member of the Board of Directors of the
Company or any Subsidiary of the Company.
1.12 "Disability" of a Participant shall be deemed to occur
whenever a Participant is rendered unable to engage in any
substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected
to result in death or which has lasted or can be expected to
last for a continuing period of not less than 12 months.
1.13 "Employee" means an employee of the Company, or of any
Subsidiary, the Board of Directors of which adopts the Plan, as
defined under Section 3401(c) of the Code and the regulations
thereunder. Unless the context otherwise indicates, the term
"Employee" shall include any Officers and Directors who are not
Non-Employee Directors.
1.14 "ERISA" means the Employee Retirement Income Security Act
of 1974, as amended.
1.15 "Fair Market Value" of the Company's shares of Common
Stock means (i) the closing price per share on any stock
exchange on which the Common Stock is traded, or (ii) the mean
between the closing or average (as the case may be) bid and
asked prices per share of Common Stock on the over-the-counter
market, whichever is applicable.
1.16 "Incentive Stock Option" means an option to purchase
shares of Common Stock granted to a Participant and which is
intended to qualify as an incentive stock option under Section
422 of the Code.
1.17 "1934 Act" means the Securities Exchange Act of 1934, as
amended.
1.18 "Non-discretionary Stock Option" means a Nonqualified
Stock Option granted to a Non-Employee Director under Article IV.
1.19 "Non-Employee Director" means a Director of the Company
who is not an Officer or Employee.
1.20 "Nonqualified Stock Option" means an option to purchase
shares of Common Stock granted to a Participant and which is not
intended to qualify as an incentive stock option under Section
422 of the Code.
1.21 "Officer" means an officer of the Company or any
Subsidiary of the Company.
1.22 "Participant" means any Employee, Director or Advisor who
is, or who is proposed to be, a recipient of a Stock Option.
1.23 "Plan" means the Triton Energy Corporation Amended and
Restated 1992 Stock Option Plan.
1.24 "Retirement" of a Participant shall be deemed to be
retirement after reaching (i) age 65 or (ii) age 55 and having
completed at least 10 years of service with the Company.
1.25 "Stock Options" means any and all Incentive Stock Options
and Nonqualified Stock Options granted pursuant to the Plan.
1.26 "Stock Option Agreement" means an agreement between the
Company and a Participant with respect to one or more of the
Stock Options.
1.27 "Subsidiary" means any corporation in an unbroken chain of
corporations beginning with the Company if, at the time of
granting of the Stock Option, each of the corporations other
than the last corporation in the unbroken chain owns stock
possessing 50% or more of the total combined voting power of all
classes of stock in one of the other corporations in the chain,
and "Subsidiaries" means more than one of any such corporations.
ARTICLE II
Administration
Subject to the terms of this Article II, the Plan shall be
administered by the Committee, which shall consist of not fewer
than three members, who shall be Non-Employee Directors of the
Company. Any member of the Committee may be removed at any
time, with or without cause, by resolution of the Board. Any
vacancy occurring in the membership of the Committee may be
filled by appointment by the Board. Each member of the
Committee, at the time of his appointment to the Committee and
while he is a member thereof, must be "disinterested," as
defined in Rule 16b-3 promulgated under the 1934 Act or any
predecessor provision thereto, as applicable.
The Committee shall select one of its members to act as its
Chairman, and shall make such rules and regulations for its
operation as it deems appropriate. A majority of the Committee
shall constitute a quorum and the act of a majority of the
members of the Committee present at a meeting at which a quorum
is present shall be the act of the Committee. Subject to the
terms hereof, the Committee shall have complete authority to
designate from time to time the Employees and Advisors to whom
Stock Options will be granted, to interpret the Plan, to
prescribe, amend, and rescind any rules and regulations
necessary or appropriate for the administration of the Plan, to
determine the details and provisions of each Stock Option
Agreement, to modify or amend any Stock Option Agreement or
waive any conditions or restrictions applicable to any Stock
Option or the exercise thereof, and to make such other
determinations and, subject to the terms of the Plan, take such
other action as it deems necessary or advisable. In this
regard, the Committee shall consider and give appropriate weight
to input from representatives of management of the Company
regarding the contributions or potential contributions to the
Company of certain of the Employees and Advisors or potential
Employees and Advisors of the Company. Except as provided
below, any interpretation, determination, or other action made
or taken by the Committee shall be final, binding, and
conclusive on all interested parties, including the Company and
all Participants.
ARTICLE III
Shares Subject to Plan
The Committee may not grant Stock Options under the Plan for
more than 3,700,000 shares of Common Stock of the Company (as
may be adjusted in accordance with Article XI or XII hereof),
and no Participant shall be eligible to receive more than 50% of
such shares. Shares to be distributed and sold may be made
available from either authorized but unissued Common Stock or
Common Stock held by the Company in its treasury. Shares that
by reason of the expiration or unexercised termination of a
Stock Option are no longer subject to purchase may be reoffered
under the Plan.
ARTICLE IV
Non-Employee Directors' Stock Options
The following provisions of this Article IV shall apply only to
Stock Options granted under the Plan to Non-Employee Directors
of the Company.
4.1 Eligibility. Only Non-Employee Directors of the Company
shall be eligible to receive grants of the Stock Options
provided under this Article IV.
4.2 Grant of Stock Options. Throughout the term of this Plan,
on November 15 of each year, the Committee shall grant to each
Non-Employee Director of the Company, a Nonqualified Stock
Option to purchase 15,000 shares of Common Stock. The grant of
Stock Options under this Article IV shall be evidenced by Stock
Option Agreements setting forth the total number of shares
subject to the Stock Option, the option exercise price, the term
of the Stock Option and such other terms and provisions as are
consistent with the Plan.
4.3 Option Exercise Price. The exercise price for a Stock
Option granted under this Article IV shall be equal to 100% of
the Fair Market Value per share of Common Stock on the Date of
Grant. The Committee shall determine the Fair Market Value per
share of the Common Stock on the Date of Grant and shall set
forth the determination in its minutes. Notwithstanding
anything to the contrary in this Section 4.3, the exercise price
of each Stock Option granted pursuant to this Article IV shall
not be less than the par value per share of the Common Stock.
4.4 Option Period. The option period for each Stock Option
granted under this Article IV will terminate ten years from the
Date of Grant. No Stock Option granted under this Article IV
may be exercised at any time after its term.
4.5 Payment. Full payment for shares purchased upon exercise
of a Stock Option granted under this Article IV shall be made
either in (i) cash, (ii) by certified or cashier's check, (iii)
if permitted by the Committee, by shares of Common Stock, (iv)
if permitted by the Committee, and if permitted under the laws
of the State of Texas, by cash or certified or cashier's check
for the par value of the shares plus a promissory note for the
balance of the purchase price, which note shall provide for full
personal liability of the maker and shall contain such other
terms and provisions as the Committee may determine, including
without limitation the right to repay the note partially or
wholly with Common Stock, or (v) by delivery of a copy of
irrevocable instructions from the Participant to a broker or
dealer, reasonably acceptable to the Company, to sell certain of
the shares purchased upon exercise of the Stock Option or to
pledge them as collateral for a loan and promptly deliver to the
Company the amount of sale or loan proceeds necessary to pay
such purchase price. If any portion of the purchase price or a
note given at the time of exercise is paid in shares of Common
Stock, those shares shall be valued at the then Fair Market
Value.
4.6 Exercise of Stock Option. Except only as specifically
provided elsewhere in this Plan, each Stock Option granted under
this Article IV shall be exercisable in the following cumulative
installments:
First installment. Up to 33-1/3% of the total optioned shares
at any time after one (1) year following the Date of Grant.
Second installment. Up to an additional 33-1/3% of the total
optioned shares at any time after two (2) years following the
Date of Grant.
Third installment. Up to an additional 33-1/3% of the total
optioned shares at any time after three (3) years following the
Date of Grant.
If an installment covers a fractional share, such installment
will be rounded off to the next highest share, except for the
final installment, which will be for the balance of the total
optioned shares. No Stock Option granted under the Plan may be
exercised at any time after ten years from the Date of Grant.
Notwithstanding the foregoing paragraph, Stock Options shall
not be exercisable at any time during the six month period which
begins on the Date of Grant. Except as otherwise contained
herein (see Section 14.7 hereof), Stock Options may not be
exercised, nor may shares be issued under a Stock Option (i)
until the Plan has been approved by the shareholders of the
Company, if necessary to comply with Rule 16b-3 promulgated
under the 1934 Act or with the applicable rules or regulations
of any stock exchange or inter-dealer quotation system on which
the Common Stock is listed or quoted or (ii) if any necessary
listing of the shares on a stock exchange or any registration
under state or federal securities laws required under the
circumstances has not been accomplished.
ARTICLE V
Employees' and Advisors' Stock Options
The following provisions of this Article V shall apply only to
Stock Options granted under the Plan to Employees and Advisors
of the Company or any of its Subsidiaries.
5.1 Eligibility. The Committee shall, from time to time,
select the particular Employees and Advisors of the Company and
its Subsidiaries to whom the Stock Options provided under this
Article V are to be granted and/or distributed in recognition of
each such Employee's or Advisor's contribution to the Company's
success.
5.2 Grant of Stock Options. All grants of Stock Options to
Employees and Advisors under this Article V shall be awarded by
the Committee at such times and for such amounts as the
Committee may determine; in the discretion of the Committee, any
grant to an Employee may be in the form of an Incentive Stock
Option. The grant of Stock Options shall be evidenced by Stock
Option Agreements setting forth the total number of shares
subject to each Stock Option, the option exercise price, the
term of the Stock Option, and such other terms and provisions as
are consistent with the Plan.
5.3 Option Exercise Price. The exercise price for a Stock
Option granted under this Article V shall be determined by the
Committee and shall be an amount not less than 100% of the Fair
Market Value per share of the Common Stock on the Date of Grant;
the Committee shall determine the Fair Market Value of the
Common Stock on the Date of Grant, and shall set forth the
determination in its minutes. Notwithstanding anything to the
contrary in this Section 5.3, the exercise price of each Stock
Option granted under the Plan shall not be less than the par
value per share of the Common Stock.
5.4 Option Period. The option period for each Stock Option
granted under this Article V will begin and terminate on the
respective dates specified by the Committee but may not
terminate later than ten years from the Date of Grant. No Stock
Option granted under the Plan may be exercised at any time after
its term. The Committee may provide that Stock Options granted
under this Article V may be exercised in installments and upon
such terms, conditions and restrictions as it may determine.
5.5 Payment. Full payment for shares purchased upon exercise
of a Stock Option shall be made in (i) cash, (ii) by certified
or cashier's check, (iii) if permitted by the Committee, by
shares of Common Stock, (iv) if permitted by the Committee, and
if permitted under the laws of the State of Texas, by cash or
certified or cashier's check for the par value of the shares
plus a promissory note for the balance of the purchase price,
which note shall provide for full personal liability of the
maker and shall contain such other terms and provisions as the
Committee may determine, including without limitation the right
to repay the note partially or wholly with Common Stock, or (v)
by delivery of a copy of irrevocable instructions from the
Participant to a broker or dealer, reasonably acceptable to the
Company, to sell certain of the shares purchased upon exercise
of the Stock Option or to pledge them as collateral for a loan
and promptly deliver to the Company the amount of sale or loan
proceeds necessary to pay such purchase price. If any portion
of the purchase price or a note given at the time of exercise is
paid in shares of Common Stock, those shares shall be valued at
the then Fair Market Value.
5.6 Exercise of Stock Option. Stock Options granted under the
Plan may be exercised during the option period, at such times
and in such amounts, in accordance with the terms and conditions
and subject to such restrictions as are set forth herein and in
the applicable Stock Option Agreements; provided, however, Stock
Options shall not be exercisable at any time during the six
month period which begins on the Date of Grant. Except as
otherwise contained herein (see Section 14.7 hereof), Stock
Options may not be exercised, nor may shares be issued under a
Stock Option (i) until the Plan has been approved by the
shareholders of the Company, if necessary to comply with Rule
16b-3 promulgated under the 1934 Act or with the applicable
rules or regulations of any stock exchange or inter-dealer
quotation system on which the Common Stock is listed or quoted
or (ii) if any necessary listing of the shares on a stock
exchange or any registration under state or federal securities
laws required under the circumstances has not been accomplished.
Subject to the provisions of the foregoing paragraph and unless
the Committee determines otherwise, the Stock Options granted
hereunder shall be exercisable in the following cumulative
installments:
First installment. Up to 25% of the total optioned shares at
any time after one (1) year following the Date of Grant.
Second installment. Up to an additional 25% of the total
optioned shares at any time after two (2) years following the
Date of Grant.
Third installment. Up to an additional 25% of the total
optioned shares at any time after three (3) years following the
Date of Grant.
Fourth installment. Up to an additional 25% of the total
optioned shares at any time after four (4) years following the
Date of Grant.
Notwithstanding the foregoing, the Committee shall have the
right to accelerate the time at which any Stock Option granted
to an Employee or Advisor shall become exercisable. If an
installment covers a fractional share, such installment will be
rounded off to the next highest share, except the final
installment, which will be for the balance of the total optioned
shares. No Stock Option granted under the Plan may be exercised
at any time after ten years from the Date of Grant.
ARTICLE VI
Limitations on Incentive Stock Options
Notwithstanding the terms of Article V hereof, the following
provisions of this Article VI shall apply to all Incentive Stock
Options granted under the Plan to Employees of the Company or
any of its Subsidiaries.
6.1 Stock Ownership Limitation. In the case of an Incentive
Stock Option, the Stock Option Agreement shall include
provisions that may be necessary to assure that the option is an
incentive stock option under the Code. No Incentive Stock
Option may be granted to an Employee who owns more than 10% of
the total combined voting power of all classes of stock of the
Company or its Subsidiaries. This limitation will not apply if
the option price is at least 110% of the fair market value of
the Common Stock on the Date of Grant and the option is not
exercisable more than five years from the Date of Grant.
6.2 Option Period. Notwithstanding the provisions of Sections
4.4 and 5.4 hereof, if an Employee owns or is deemed to own (by
reason of the attribution rules of Section 424(d) of the Code)
more than 10% of the combined voting power of all classes of
stock of the Company (or any Subsidiary of the Company) and an
Incentive Stock Option is granted to such Employee, the term of
such Incentive Stock Option (to the extent required by the Code
at the time of grant) shall be no more than five years from the
Date of Grant.
6.3 Limitation on Exercise of Incentive Stock Options. To the
extent required by the Code for incentive stock options, the
exercise of Incentive Stock Options granted under the Plan shall
be subject to the $100,000 calendar year limit as set forth in
Section 422(d) of the Code.
ARTICLE VII
Termination of Employment or Service
In the event a Participant who is an Employee of the Company
or any Subsidiary shall cease to be employed by the Company or a
Subsidiary, or a Participant who is a Director or Advisor, shall
cease to serve as a Director or Advisor, for any reason other
than death, retirement, Disability or for cause, (i) the
Committee shall have the ability to accelerate the vesting of
the Participant's Stock Option (other than a Non-discretionary
Stock Option) in its sole discretion, and (ii) such
Participant's Stock Option shall be exercisable (to the extent
exercisable on the date of termination of employment or service
as a Director or Advisor, or, if the Committee, in its
discretion, has accelerated the vesting of such Stock Option, to
the extent exercisable following such acceleration) (a) if such
Stock Option is an Incentive Stock Option or a Non-discretionary
Stock Option, at any time within three months after the date of
termination of employment or service as a Non-Employee Director,
unless by its terms the Stock Option expires earlier; or (b) if
such Stock Option is a Nonqualified Stock Option other than a
Non-discretionary Stock Option, at any time within one year
after the date of termination of employment or service as a
Director or Advisor, unless by its terms the Stock Option
expires earlier or unless the Committee agrees, in its sole
discretion, to further extend the term of such Nonqualified
Stock Option; provided that the term of any such Nonqualified
Stock Option shall not be extended beyond its initial term. In
addition, a Participant's Stock Option may be exercised as
follows in the event such Participant ceases to serve as an
Employee, Director or Advisor due to death, disability,
retirement or for cause:
(a) Death. Except as otherwise limited by the Committee at the
time of the grant of a Stock Option, if a Participant dies while
employed by the Company or a Subsidiary, or while serving as a
Director or Advisor, or within three months after ceasing to be
an Employee, Director or Advisor, his Stock Option shall become
fully exercisable on the date of his death and shall expire 12
months thereafter, unless by its terms it expires sooner or the
Committee agrees, in its sole discretion, to further extend the
term of such Stock Option (other than an Incentive Stock Option
or a Non-discretionary Stock Option); provided that the term of
any such Stock Option shall not be extended beyond its initial
term. During such period, the Stock Option may be fully
exercised, to the extent that it remains unexercised on the date
of death, by the Participant's personal representative or by the
distributees to whom the Participant's rights under the Stock
Option shall pass by will or by the laws of descent and
distribution.
(b) Retirement. If a Participant ceases to be employed by the
Company or a Subsidiary, or ceases to serve as a Director or
Advisor, as a result of retirement, (i) the Committee shall have
the ability to accelerate the vesting of the Participant's Stock
Option (other than a Non-discretionary Stock Option, which shall
automatically be accelerated) in its sole discretion, and (ii)
the Participant's Stock Option shall be exercisable (to the
extent exercisable on the effective date of such retirement or,
if the vesting of such Stock Option has been accelerated, to the
extent exercisable following such acceleration) (a) if such
Stock Option is an Incentive Stock Option or a Non-discretionary
Stock Option, at any time three months after the effective date
of such retirement, unless by its terms the Stock Option expires
earlier, and (b) if such Stock Option is a Nonqualified Stock
Option other than a Non-discretionary Stock Option, at any time
within one year after the effective date of such retirement,
unless by its terms the Stock Option expires sooner or the
Committee agrees, in its sole discretion, to further extend the
term of such Nonqualified Stock Option; provided that the term
of any such Nonqualified Stock Option shall not be extended
beyond its initial term.
(c) Disability. If a Participant ceases to be employed by the
Company or a Subsidiary, or ceases to serve as a Director or
Advisor, as a result of Disability, the Participant's Stock
Option shall become fully exercisable and shall expire 12 months
thereafter, unless by its terms it expires sooner or, unless the
Committee agrees, in its sole discretion, to extend the term of
such Stock Option (other than an Incentive Stock Option or
Non-discretionary Stock Option); provided that the term of any
Stock Option shall not be extended beyond its initial term.
(d) Cause. If a Participant ceases to be employed by the
Company or a Subsidiary, or ceases to serve as a Director or
Advisor, because the Participant is terminated for Cause, the
Participant's Stock Option shall automatically expire.
ARTICLE VIII
Amendment or Discontinuance
Subject to the limitations set forth in this Article VIII, the
Board may, without the consent of the Participants, alter,
amend, revise, suspend, or discontinue the Plan. The Board may
not amend the provisions of Article IV more than once during any
six month period unless to comply with changes in the Code or
ERISA, or any rules or regulations promulgated thereunder. The
Board may not alter, amend, revise, suspend or discontinue the
Plan without obtaining approval of the Company's shareholders if
such action would (i) materially increase the benefits accruing
to Participants under the Plan, (ii) materially increase the
number of securities which may be issued under the Plan, or
(iii) materially modify the requirements as to eligibility for
participation in the Plan. Subject to the foregoing
limitations, the Board may amend the Plan or modify the
agreements evidencing same in order to comply with any exemption
from the operation of Section 16(b) of the 1934 Act. The
Committee may also substitute new Stock Options for previously
granted Stock Options, including previously granted Stock
Options having higher exercise prices.
ARTICLE IX
Effect of the Plan
Neither the adoption of this Plan nor any action of the Board
or the Committee shall be deemed to give any Officer or Employee
any right to be granted a Stock Option to purchase or receive
Common Stock of the Company or any other rights except as may be
evidenced by a Stock Option Agreement, or any amendment thereto,
duly authorized by the Committee and executed on behalf of the
Company and then only to the extent and upon the terms and
conditions expressly set forth therein.
ARTICLE X
Term
The Plan shall be submitted to the Company's shareholders for
their approval; however, Stock Options may be granted under the
Plan prior to the time of shareholder approval. Unless sooner
terminated by action of the Board, the Plan will terminate on
the 15th day of September, 2003. Stock Options under the Plan
may not be granted after that date, but Stock Options granted
before that date will continue to be effective in accordance
with their terms and conditions.
ARTICLE XI
Capital Adjustments
If at any time while the Plan is in effect or unexercised Stock
Options are outstanding there shall be any increase or decrease
in the number of issued and outstanding shares of Common Stock
through the declaration of a stock dividend or through any
recapitalization resulting in a stock split-up, combination, or
exchange of shares of Common Stock, then and in such event:
(i) An appropriate adjustment shall be made in the maximum
number of shares of Common Stock then subject to being awarded
under grants pursuant to the Plan, to the end that the same
proportion of the Company's issued and outstanding shares of
Common Stock shall continue to be subject to being so awarded;
(ii) An appropriate adjustment shall be made in the number
of shares of Common Stock subject to being awarded to each
Non-Employee Director of the Company under Article IV, to the
end that the same proportion of the Company's issued and
outstanding shares of Common Stock shall continue to be subject
to being so awarded; and
(iii) Appropriate adjustments shall be made in the number of
shares of Common Stock and the exercise price per share thereof
then subject to purchase pursuant to each such Stock Option
previously granted and unexercised, to the end that the same
proportion of the Company's issued and outstanding shares of
Common Stock in each instance shall remain subject to purchase
at the same aggregate exercise price.
Any fractional shares resulting from any adjustment made
pursuant to this Article XI shall be eliminated for the purposes
of such adjustment. Except as otherwise expressly provided
herein, the issuance by the Company of shares of its capital
stock of any class, or securities convertible into shares of
capital stock of any class, either in connection with direct
sale or upon the exercise of rights or warrants to subscribe
therefor, or upon conversion of shares or obligations of the
Company convertible into such shares or other securities, shall
not affect, and no adjustment by reason thereof shall be made
with respect to, the number of or exercise price of shares of
Common Stock then subject to outstanding Stock Options granted
under the Plan.
ARTICLE XII
Recapitalization, Merger and Consolidation
(a) The existence of this Plan and Stock Options granted
hereunder shall not affect in any way the right or power of the
Company or its shareholders to make or authorize any or all
adjustments, recapitalizations, reorganizations or other changes
in the Company's capital structure or its business, or any
merger, share exchange or consolidation of the Company, or any
issue of bonds, debentures, preferred or prior preference stocks
ranking prior to or otherwise affecting the Common Stock or the
rights thereof (or any rights, options or warrants to purchase
same), or the dissolution or liquidation of the Company, or any
sale or transfer of all or any part of its assets or business,
or any other corporate act or proceeding, whether of a similar
character or otherwise.
(b) Subject to any required action by the shareholders, if the
Company shall be the surviving or resulting corporation in any
merger, share exchange or consolidation, any outstanding Stock
Option granted hereunder shall pertain to and apply to the
securities or rights (including cash, property or assets) to
which a holder of the number of shares of Common Stock subject
to the Stock Option would have been entitled.
(c) In the event of any merger, share exchange or
consolidation pursuant to which the Company is not the surviving
or resulting corporation, there shall be substituted for each
share of Common Stock subject to the unexercised portions of
such outstanding Stock Option that number of shares of each
class of stock or other securities or that amount of cash,
property or assets of the surviving or consolidated company
which were distributed or distributable to the shareholders of
the Company in respect of each share of Common Stock held by
them, such outstanding Stock Options to be thereafter
exercisable for such stock, securities, cash or property in
accordance with their terms. Notwithstanding the foregoing,
however, all such Stock Options may be cancelled by the Board as
of the effective date of any such reorganization, merger or
consolidation, or of any proposed sale of substantially all of
the assets of the Company, or of any dissolution or liquidation
of the Company, by giving notice to each holder thereof or his
personal representative of its intention to do so and by
permitting the purchase during the thirty (30) day period next
preceding such effective date of any or all of the shares
subject to such outstanding Stock Options, including shares as
to which such Stock Option would not otherwise be exercisable.
(d) In the event of a Change in Control of the Company, then,
notwithstanding any other provision in the Plan to the contrary,
all unmatured installments of Stock Options outstanding shall
thereupon automatically be accelerated and exercisable in full.
(e) In case the Company shall, at any time while any Stock
Option under this Plan shall be in force and remain unexpired,
(i) sell all or substantially all of its property, or (ii)
dissolve, liquidate, or wind up its affairs, then each
Participant may thereafter receive upon exercise hereof (in lieu
of each share of Common Stock of the Company which such
Participant would have been entitled to receive) the same kind
and amount of any securities or assets as may be issuable,
distributable or payable upon any such sale, dissolution,
liquidation, or winding up with respect to each share of Common
Stock of the Company. In the event that the Company shall, at
any time prior to the expiration of any Stock Option make any
partial distribution of its assets in the nature of a partial
liquidation, whether payable in cash or in kind (but excluding
the distribution of a cash dividend payable out of retained
earnings or earned surplus and designated as such), then in such
event the exercise prices then in effect with respect to each
option shall be reduced, as of the payment date of such
distribution, in proportion to the percentage reduction in the
tangible book value of the shares of the Company's Common Stock
(determined in accordance with generally accepted accounting
principles) resulting by reason of such distribution; provided,
that in no event shall any adjustment of exercise prices in
accordance with the terms of the Plan result in any exercise
prices being reduced below the par value per share of the Common
Stock.
(f) Upon the occurrence of each event requiring an adjustment
of the exercise price and/or the number of shares purchasable
pursuant to Stock Options granted pursuant to the terms of this
Plan, the Committee shall mail forthwith to each Participant a
copy of its computation of such adjustment which shall be
conclusive and shall be binding upon each such Participant.
ARTICLE XIII
Options in Substitution for Stock Options
Granted by Other Corporations
Stock Options may be granted under the Plan from time to time
in substitution for stock options held by employees of a
corporation who become or are about to become Employees of the
Company or a Subsidiary as the result of a merger or
consolidation of the employing corporation with the Company or a
Subsidiary, the acquisition by either of the foregoing of stock
of the employing corporation as the result of which it becomes a
Subsidiary or a sale of substantially all of the assets of the
employing corporation. The terms and conditions of the
substitute options so granted may vary from the terms and
conditions set forth in this Plan to such extent as the
Committee at the time of grant may deem appropriate to conform,
in whole or in part, to the provisions of the options in
substitution for which they are granted.
ARTICLE XIV
Miscellaneous Provisions
14.1 Non-Assignability. The Committee may, in its discretion,
agree that Nonqualified Stock Options, other than
Non-discretionary Stock Options, granted hereunder are
transferable by the Participant to members of his immediate
family (i.e., parents, children, grandchildren or spouse),
trusts for the benefit of such immediate family members and
partnerships in which such immediate family members are the only
partners, provided that there cannot be any consideration for
the transfer.
Except as may be agreed upon by the Committee in accordance
with the immediately preceding paragraph, a Stock Option granted
to a Participant may not be transferred or assigned, other than
(i) by will or the laws of descent and distribution or (ii)
pursuant to the terms of a qualified domestic relations order as
defined by the Code or Title I of ERISA, provided that in the
case of an Incentive Stock Option, such transfer or assignment
may occur only to the extent it will not result in disqualifying
such option as an incentive stock option under Section 422 of
the Code, or any other successor provision. Subject to the
foregoing, during a Participant's lifetime, Stock Options
granted to a Participant may be exercised only by the
Participant or, subject to the terms hereof and to the extent
such exercise would not result in disqualifying such Stock
Option as an Incentive Stock Option under Section 422 of the
Code (or any other successor provision), by the Participant's
guardian or legal representative, and each Stock Option
Agreement shall so provide. The designation by a Participant of
a beneficiary shall not constitute a transfer of the Stock
Option.
14.2 Investment Intent. The Company may require that there be
presented to and filed with it by any Participant(s) under the
Plan, such evidence as it may deem necessary to establish that
the Stock Options granted or the shares of Common Stock to be
purchased or transferred are being acquired for investment and
not with a view to their distribution.
14.3 No Right to Continue Employment. Nothing in the Plan or
the grant of any Stock Option confers upon any Employee the
right to continue in the employ of the Company or interferes
with or restricts in any way the right of the Company to
discharge any Employee at any time (subject to any contract
rights of such Employee).
14.4 Shareholders' Rights. The holder of a Stock Option shall
have none of the rights or privileges of a shareholder except
with respect to shares which have been actually issued.
14.5 Tax Withholding.
(a) Whenever shares of Common Stock are to be issued in
satisfaction of a Stock Option granted hereunder, the Company
shall have the right to require the Participant to remit to the
Company an amount sufficient to satisfy federal, state, local or
other withholding tax requirements (whether so required to
secure for the Company an otherwise available tax deduction or
otherwise) prior to the delivery of any certificate or
certificates for such shares.
(b) When an Employee or Advisor participating in the Plan who
is not subject to Section 16 of the 1934 Act is required to pay
to the Company an amount required to be withheld under
applicable income tax laws in connection with the exercise of a
Stock Option, such payment may be made in cash or by check, or
the Employee or Advisor may satisfy the obligation, in whole or
in part, by electing to (i) have the Company withhold a portion
of the shares of Common Stock acquired upon the exercise of the
Stock Option and having a Fair Market Value on the date on which
the amount of tax to be withheld is determined equal to the
amount required to be withheld or (ii) deliver to the Company
shares of Common Stock already owned by the Employee or Advisor
and having a Fair Market Value on the date on which the amount
of tax to be withheld is determined equal to the amount required
to be withheld.
(c) When an Officer or Director participating in the Plan who
is subject to Section 16 of the 1934 Act is required to pay the
Company an amount required to be withheld under applicable
income tax laws in connection with the exercise of a Stock
Option, the withholding obligation may be satisfied, at the
option of the Committee, by the Company withholding a portion of
the shares acquired upon the exercise of the Stock Option having
a Fair Market Value on the date on which the amount of tax to be
withheld is determined equal to the amount required to be
withheld.
(d) As a condition to the issuance of shares of Common Stock
covered by any Incentive Stock Option, the party exercising such
Stock Option shall give a written representation to the Company,
which is satisfactory in form and substance to its counsel and
upon which the Company may reasonably rely, that he or she will
report to the Company any disposition of such shares prior to
the expiration of the holding periods specified by Section
422(a)(1) of the Code. If and to the extent that the
realization of income in such a disposition imposes upon the
Company federal, state, local or other withholding tax
requirements, or any such withholding is required to secure for
the Company an otherwise available tax deduction, the Company
shall have the right to require that the recipient remit to the
Company an amount sufficient to satisfy those requirements; and
the Company may require as a condition to the issuance of shares
of Common Stock covered by an Incentive Stock Option that the
party exercising such Stock Option give a satisfactory written
representation promising to make such a remittance.
14.6 Indemnification of Board and Committee. No member of the
Board or the Committee, nor any Officer or Employee of the
Company acting on behalf of the Board or the Committee, shall be
personally liable for any action, determination, or
interpretation taken or made in good faith with respect to the
Plan, and all members of the Board or the Committee and each and
any Officer or Employee of the Company acting on their behalf
shall, to the extent permitted by law, be fully indemnified and
protected by the Company in respect of any such action,
determination or interpretation.
14.7 Government Regulations. Notwithstanding any of the
provisions hereof, or of any written agreements evidencing Stock
Options granted hereunder, the obligation of the Company to sell
and deliver shares shall be subject to all applicable laws,
rules and regulations and to such approvals by any government
agencies or national securities exchanges as may be required.
The Participant shall agree not to exercise any Stock Option,
and the Company shall not be obligated to issue any shares, if
the exercise thereof or if the issuance of shares shall
constitute a violation by the Participant or the Company of any
provision of any law or regulation of any governmental authority.
ARTICLE XV
Effective Date
The effective date of the Plan, as amended and restated, shall
be September 16, 1993, that is, the date on which it was
approved and adopted by the Board; provided that any grants to
Participants hereunder are conditioned upon approval of the Plan
by the shareholders of the Company; and provided further that no
Incentive Stock Option may be exercised unless this Plan is
approved by a vote of the holders of a majority of the
outstanding shares of the Company's Common Stock at a meeting of
shareholders of the Company held within twelve (12) months
following the date of the Plan's adoption by the Board.
IN WITNESS WHEREOF, the Company has caused this instrument to
be executed as of the _______ day of ____________, 1994.
TRITON ENERGY CORPORATION
By: // Robert B. Holland, III
-------------------------
Robert B. Holland, III
Sr. Vice President, General Counsel
and Secretary
Attest:
// Tamera D. Gibson
- --------------------------------
Tamera D. Gibson, Asst.Secretary
THIS AGREEMENT CONTAINS PROVISIONS
WHICH ARE SUBJECT TO ARBITRATION UNDER THE
TEXAS GENERAL ARBITRATION ACT (ARTICLE 224
THROUGH 238-6, REVISED CIVIL STATUTES OF TEXAS)
EMPLOYMENT AGREEMENT
THIS AGREEMENT made and entered into by and between TRITON
ENERGY CORPORATION (the "Company"), having a business address at
6688 N. Central Expressway, Suite 1400, Dallas, Texas 75206 and
_________________________________ ("Employee"), having a mailing
address at __________________________________.
W I T N E S S E T H:
WHEREAS, the Company considers the establishment and
maintenance of a sound and vital management to be essential to
protecting and enhancing the best interests of the Company and its
shareholders;
WHEREAS, the Company recognizes that, as is the case with many
publicly held corporations, the possibility of a change in control
may exist and that such possibility, and the uncertainty and
questions which it may raise among management, may result in the
departure or distraction of management personnel to the detriment
of the Company and its shareholders;
WHEREAS, the Company's Board of Directors has determined that
appropriate steps should be taken to reinforce and encourage the
continued attention and dedication of members of the Company's
management, including Employee, to their assigned duties without
distraction in the face of the potentially disturbing circumstances
arising from the possibility of a change in control of the Company;
and
WHEREAS, in order to induce Employee to remain in the employ
of the Company, the Company is willing to agree to provide certain
severance benefits to Employee in the event Employee's employment
is terminated subsequent to a "change in control of the Company" (as
defined in Section 2 hereof) under the circumstances described
below;
NOW, THEREFORE, in consideration of the mutual premises and
conditions contained herein, the parties hereto agree as follows:
1. TERM
1.1 Contract Term. This Agreement shall commence on the
date hereof, shall continue until December 31, 19 ;
provided, however, that commencing January 1, 19 and each
January 1st thereafter the term of this Agreement shall
automatically be extended for an additional year unless (i)
there has been no change of control and (ii) no fewer than
thirty (30) days prior to such January 1st date, the Company
shall have given notice that it does not wish to extend this
Agreement.
1.2 Consideration by Employee. In consideration of the
Company's entering into this Agreement, Employee hereby agrees
that, for the period commencing on the date hereof and
extending through December 31, 19 , Employee will not
voluntarily terminate employment with the Company, except in
the event of (i) a "change in control" of the Company as
provided herein, (ii) a substantial change in Employee's
position, duties, compensation or benefits which would be
deemed "Good Reason" for Employee to terminate his employment
in accordance with Section 3.3 if there were a change of
control, or (iii) the Company's consenting to such
termination.
2. CHANGE IN CONTROL. No benefits shall be payable hereunder
unless there shall have been a change in control of the Company, as
set forth below, and Employee's employment by the Company shall
thereafter have been terminated within two (2) years of the date of
such change in control in accordance with Section 3 below. For
purposes of this Agreement, a "change in control of the Company"
shall mean the occurrence of any of the following events: (i) there
shall be consummated (x) any consolidation or merger of the Company
in which the Company is not the continuing or surviving corporation
or pursuant to which shares of the Company's Common Stock would be
converted into cash, securities or other property, other than a
merger of the Company in which the holders of the Company's Common
Stock immediately prior to the merger have the same proportionate
ownership of common stock of the surviving corporation immediately
after the merger, or (y) any sale, lease, exchange or other transfer
(excluding transfer by way of pledge or hypothecation), in one
transaction or a series of related transactions, of all, or
substantially all, of the assets of the Company, (ii) the
shareholders of the Company approve any plan or proposal for the
liquidation or dissolution of the Company, (iii) any "person" (as
such term is defined in Section 3(a)(9) or Section 13(d)(3) under
the 1934 Act) or any "group" (as such term is used in Rule 13d-5
promulgated under the 1934 Act), other than the Company or any
successor of the Company or any Subsidiary of the Company or any
employee benefit plan of the Company or any Subsidiary (including
such plan's trustee), becomes, without the prior approval of the
Board, a beneficial owner for purposes of Rule 13d-3 promulgated
under the 1934 Act, directly or indirectly, of securities of the
Company representing 25.0% or more of the Company's then outstanding
securities having the right to vote in the election of Directors of
the Company, or (iv) during any period of two consecutive years,
individuals who, at the beginning of such period constituted the
entire Board, cease for any reason (other than death) to constitute
a majority of the Directors of the Company, unless the election, or
the nomination for election, by the Company's shareholders, of each
new Director of the Company was approved by a vote of at least two-
thirds of the Directors of the Company then still in office who were
Directors of the Company at the beginning of the period.
3. TERMINATION OF EMPLOYMENT FOLLOWING CHANGE IN CONTROL. If
any of the events described in Section 2 hereof constituting a
change in control of the Company shall have occurred, Employee shall
be entitled to the benefits provided in Section 4 hereof upon the
subsequent termination of his employment, provided that such
termination occurs within two (2) years of a change in control of
the Company and unless such termination is (a) because of his death,
"Disability" or "Retirement" (as defined in Section 3.1 below), (b)
by the Company for "Cause" (as defined in Section 3.2 below), or (c)
by Employee other than for "Good Reason" (as defined in Section 3.3
hereof).
3.1 Disability; Retirement
3.1-1 If, as a result of Employee's incapacity due
to physical or mental illness, Employee shall have been absent
from his duties with the Company on a full-time basis for 120
consecutive business days, and within thirty (30) days after
written notice of termination is given Employee shall not have
returned to the full-time performance of his duties, the
Company may terminate this Agreement for "Disability."
3.1-2 Termination by the Company or Employee of his
employment based on "Retirement" shall mean termination in
accordance with the Company's retirement policy, including
early retirement, generally applicable to its salaried
employees or in accordance with any retirement arrangement
established with Employee's consent with respect to him.
3.2 Cause. The Company may terminate Employee's
employment for "Cause." For the purposes of this Agreement,
the Company shall have "Cause" to terminate Employee's
employment hereunder upon (A) the willful and continued
failure by Employee to perform his duties with the Company
(other than any such failure resulting from incapacity due to
physical or mental illness), after a demand for substantial
performance is delivered to Employee by the Board which
specifically identifies the manner in which the Board believes
that he has not substantially performed his duties, or (B) the
willful engaging by Employee in gross misconduct materially
and demonstrably injurious to the Company. For purposes of
this paragraph, no act, or failure to act, on Employee's part
shall be considered "willful" unless done, or omitted to be
done, by him not in good faith and without reasonable belief
that his action or omission was not in the best interest of
the Company. Notwithstanding the foregoing, Employee shall
not be deemed to have been terminated for Cause unless and
until there shall have been delivered to him a copy of a
resolution duly adopted by the affirmative vote of not less
than two-thirds (2/3d's) of the entire authorized membership
of the Board at a meeting of the Board called and held for the
purpose (after reasonable notice and an opportunity for
Employee, together with counsel, to be heard before the
Board), finding that in the good faith opinion of the Board he
was guilty of conduct set forth above in clauses (A) or (B) of
the first sentence of this paragraph and specifying the
particulars thereof in detail.
3.3 Good Reason. Employee may terminate his employment
for Good Reason. For purposes of this Agreement, "Good
Reason" shall mean:
3.3-1 Without his express written consent, the
assignment to Employee of any duties inconsistent with
his positions, duties, responsibilities and status with
the Company immediately prior to a change in control, or
a change in his reporting responsibilities, titles or
offices as in effect immediately prior to a change in
control, or any removal of Employee from or any failure
to re-elect Employee to any of such positions, except in
connection with the termination of his employment for
Cause, Disability or Retirement or as a result of his
death or by Employee other than for Good Reason;
3.3-2 A reduction by the Company in Employee's base
salary as in effect on the date hereof or as the same may
be increased from time to time;
3.3-3 The Company's requiring Employee to be based
anywhere other than the Company's offices at which he was
based immediately prior to a change in control except for
required travel on the Company's business to an extent
substantially consistent with his present business travel
obligations, or, in the event Employee consents to any
relocation, the failure by the Company to pay (or
reimburse Employee) for all reasonable moving expenses
incurred by him relating to a change of his principal
residence in connection with such relocation and to
indemnify Employee against any loss (defined as the
difference between the actual sale price of such
residence and the higher of (a) his aggregate investment
in such residence or (b) the fair market value of such
residence as determined by a real estate appraiser
designated by Employee and reasonably satisfactory to the
Company) realized on the sale of Employee's principal
residence in connection with any such change of
residence;
3.3-4 The failure by the Company to continue in
effect any benefit or compensation plan (including but
not limited to the Company's Employee Stock Option Plan,
pension plan, life insurance plan, health and accident
plan or disability plan) in which Employee is
participating at the time of a change in control of the
Company (or plans providing substantially similar
benefits), the taking of any action by the Company which
would adversely affect Employee's participation in or
materially reduce his benefits under any of such plans or
deprive him of any material fringe benefit enjoyed by him
at the time of the change in control, or the failure by
the Company to provide Employee with the number of paid
vacation days to which he is then entitled on the basis
of years of service with the Company in accordance with
the Company's normal vacation policy in effect on the
date hereof;
3.3-5 Any failure of the Company to obtain the
assumption of the agreement to perform this Agreement by
any successor as contemplated in Section 5 hereof; or
3.3-6 Any purported termination of Employee's
employment which is not effected pursuant to a Notice of
Termination satisfying the requirements of Section 3.4
below (and, if applicable, Section 3.2 above); and for
purposes of this Agreement, no such purported termination
shall be effective.
3.4 Notice of Termination. Any termination by the
Company pursuant to Sections 3.1 and 3.2 above or by Employee
pursuant to Section 3.3 above shall be communicated by written
Notice of Termination to the other party hereto. For purposes
of this Agreement, a "Notice of Termination" shall mean a
notice which shall indicate the specific termination provision
in this Agreement relied upon and shall set forth in
reasonable detail the facts and circumstances claimed to
provide a basis for termination of Employee's employment under
the provision so indicated. In the event that Employee seeks
to terminate his employment with the Company pursuant to
Section 3.3 above, he must communicate his written Notice of
Termination to the Company within sixty (60) days of being
notified of such action or actions by the Company which
constitute Good Reasons for termination.
3.5 Date of Termination. "Date of Termination" shall
mean (i) if this Agreement is terminated for Disability,
thirty (30) days after Notice of Termination is given
(provided that Employee shall not have returned to the
performance of his duties on a full-time basis during such
thirty (30) day period); (ii) if Employee's employment is
terminated pursuant to Section 3.3 above, the date is
specified in the Notice of Termination; and (iii) if
Employee's employment is terminated for any other reason, the
date on which a Notice of Termination is given; provided that,
if within thirty (30) days after any Notice of Termination is
given the party receiving such Notice of Termination notifies
the other party that a dispute exists concerning the
termination, the Date of Termination shall be the date on
which the dispute is finally determined, either by mutual
written agreement of the parties, by a binding and final
arbitration award or by a final judgment, order or decree of
a court of competent jurisdiction (the time for appeal
therefrom having expired and no appeal having been perfected).
4. COMPENSATION UPON TERMINATION OR DURING DISABILITY.
4.1 Disability. During any period that Employee fails
to perform his duties hereunder as a result of incapacity due
to physical or mental illness, he shall continue to receive
his full base salary at the rate then in effect and any
installments of deferred portions of awards under the Plan
paid during such period until this Agreement is terminated
pursuant to Section 3 hereof. Thereafter, Employee's benefits
shall be determined in accordance with the Company's Long-Term
Disability Income Insurance Plan, or a substitute plan then in
effect.
4.2 Termination for Cause. If Employee's employment
shall be terminated for Cause, the Company shall pay Employee
his full base salary through the Date of Termination at the
rate in effect at the time Notice of Termination is given and
the Company shall have no further obligations to Employee
under this Agreement.
4.3 Termination Without Cause. If the Company shall
terminate Employee's employment other than pursuant to
Sections 3.1 or 3.2 hereof or if Employee shall terminate his
employment for Good Reason, then the Company shall pay to
Employee as severance pay in a lump sum not later than the
tenth (10th) day following the Date of Termination, the
following amounts:
4.3-1 Employee's full base salary through the Date
of Termination at the rate in effect at the time of
Notice of Termination is given;
4.3-2 In lieu of any further salary payments to
Employee for periods subsequent to the Date of
Termination, an amount equal to the product of (a)
Employee's annual base salary at the rate in effect as of
the Date of Termination multiplied by (b) the number two
(2);
4.3-3 In lieu of shares of common stock of the
Company, par value $1 per share ("Company Shares")
issuable upon exercise of options ("Options"), if any,
granted to Employee under the Company's Non-Qualified
Stock Option Plans (which Options shall be canceled upon
the making of the payment referred to below), Employee
shall receive an amount in cash equal to the aggregate
spread between the exercise prices of all Options held by
Employee whether or not then fully exercisable, and the
highest price per Company Share of Common Stock actually
paid in connection with any change in control of the
Company (such price being hereinafter referred to as
"Termination Price"); and
4.3-4 The Company shall also pay all relocation and
indemnity payments as set forth in Section 3.3-4 hereof,
and all legal fees and expenses incurred by Employee as
a result of such termination (including all such fees and
expenses, if any, incurred in contesting or disputing any
such termination or in seeking to obtain or enforce any
right or benefit provided by this Agreement).
4.3-5 In the event the Employee is subject to the
excise tax imposed by Section 4999 of the Internal
Revenue Code of 1986, as amended (the "Code") as a result
of a "change in control of the Company," an amount equal
to the product of (a) 25% multiplied by (b) the amount of
any "excess parachute payment" received or receivable by
the Employee under this Agreement, under any stock option
agreement, or under any other agreement, arrangement, or
plan in which the Employee participates; for purposes of
this Agreement, "excess parachute payment" has the
meaning given to such term by Section 280G(b) of the
Code.
4.4 Benefit Plans. Unless Employee is terminated for
Cause, the Company shall maintain in full force and effect for
the continued benefit of Employee, for a two-year period after
the Date of Termination, all employee benefit plans and
programs or arrangements in which Employee was entitled to
participate immediately prior to the Date of Termination
provided that his continued participation is possible under
the general terms and provisions of such plans and programs.
In the event that Employee's participation in any such plan or
program is barred, the Company shall arrange to provide
Employee with benefits substantially similar to those which he
is entitled to receive under such plans and programs. At the
end of the period of coverage, Employee shall have the option
to have assigned to him at no cost and with no appointment of
prepaid premiums, any assignable insurance policy owned by the
Company and relating specifically to him.
4.5 Additional Benefits. If the Company shall terminate
Employee's employment other than pursuant to Section 3.1 or
3.2 hereof or if Employee shall terminate his employment for
Good Reason, then in addition to the benefits to which
Employee is entitled under the retirement plans or programs in
which Employee participates or any successor plans or programs
in effect on the date of termination of his employment
hereunder, the Company shall pay Employee in one sum in case
at his normal retirement age (or earlier retirement age should
Employee so elect) as defined in the retirement plans or
programs in which Employee participates or any successor plans
or programs in effect on the Date of Termination hereunder, an
amount equal to the actuarial equivalent of the retirement
pension to which Employee would have been entitled under the
terms of such retirement plans or programs without regard to
"vesting" thereunder, had he accumulated three (3) additional
years of continuous service (after any termination pursuant to
Section 3) at his base salary rate in effect on the Date of
Termination (including subsequent Annual Salary Adjustments)
under such retirement plans or programs reduced by the single
sum actuarial equivalent of any amounts to which he is
entitled pursuant to the provisions of said retirement plans
and programs. For purposes of this Section 4.5, "actuarial
equivalent" shall be determined using the same methods and
assumptions utilized under the Company's retirement plans and
programs immediately prior to the change in control.
4.6 Automobiles. Upon Employee's termination for any
reason, the Company shall enable Employee to purchase the
automobile, if any, which the Company was providing for
Employee's use at the time Notice of Termination was given at
the wholesale value of such automobile at such time.
4.7 Mitigation of Amounts Payable Hereunder. Employee
shall not be required to mitigate the amount of any payment
provided for in this Section 4 by seeking other employment or
otherwise, nor shall the amount of any payment provided for in
this Section 4 be reduced by any compensation earned by
Employee as the result of employment by another employer after
the Date of Termination, or otherwise.
5. SUCCESSORS; BINDING AGREEMENT.
5.1 Successors of the Company. The Company will require
any successor (whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all or substantially
all of the business and/or assets of the Company, by agreement
in form and substance satisfactory to Employee, expressly to
assume and agree to perform this Agreement in the same manner
and to the same extent that the Company would be required to
perform it if no such succession had taken place. Failure of
the Company to obtain such agreement prior to the
effectiveness of any such succession shall be a breach of this
Agreement and shall entitle Employee to compensation from the
Company in the same amount and on the same terms as Employee
would be entitled hereunder if Employee terminated his
employment for Good Reason, except that for purposes of
implementing the foregoing, the date on which any such
succession becomes effective shall be deemed the Date of
Termination. As used in this Agreement, "Company" shall mean
the Company as hereinbefore defined and any successor to its
business and/or assets as aforesaid which executes and
delivers the agreement provided for in this Section 5 or which
otherwise becomes bound by all the terms and provisions of
this Agreement by operation of law.
5.2 Employee's Heirs, etc. This Agreement shall inure
to the benefit of and be enforceable by Employee's personal or
legal representatives, executors, administrators, successors,
heirs, distributees, devisees and legatees. If Employee
should die while any amounts would still be payable to him
hereunder as if he had continued to live, all such amounts,
unless otherwise provided herein, shall be paid in accordance
with the terms of this Agreement to his devisee, legatee, or
other designee or, if there be no such designee, to his
estate.
6. NOTICE. For the purposes of this Agreement, notices and
all other communications provided for in the Agreement shall be in
writing and shall be deemed to have been duly given when delivered
or mailed by United States registered mail, return receipt
requested, postage prepaid, addressed to the respective addresses
set forth on the first page of this Agreement, provided that all
notices to the Company shall be directed to the attention of the
Chief Executive Officer of the Company with a copy to the Secretary
of the Company, or to such other in writing in accordance herewith,
except that notices of change of address shall be effective only
upon receipt.
7. MISCELLANEOUS. No provisions of this Agreement may be
modified, waived or discharged unless such waiver, modification or
discharge is agreed to in writing signed by Employee and such
officer as may be specifically designated by the Board of Directors
of the Company (which shall in any event include the Company's Chief
Executive Officer). No waiver by either party hereto at any time
of any breach by the other party hereto of, or compliance with, any
condition or provision of this Agreement to be performed by such
other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent
time. No agreements or representations, oral or otherwise, express
or implied, with respect to the subject matter hereof have been made
by either party which are not set forth expressly in this Agreement.
8. VALIDITY. The invalidity or unenforceability of any
provisions of this Agreement shall not effect the validity or
enforceablity of any other provision of this Agreement, which shall
remain in full force and effect.
9. COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original
but all of which together will constitute one and the same
instrument.
10. GOVERNING LAW. This Agreement shall be governed by and
construed under the laws of the State of Texas.
11. ARBITRATION. Any dispute or controversy arising under or
in connection with this Agreement shall be settled exclusively by
arbitration in Dallas, Texas (in accordance with the rules of the
American Arbitration Association then in effect). Notwithstanding
the pendency of any such dispute or controversy, the Company will
continue to pay Employee his full compensation in effect when the
notice giving rise to the dispute was given (including, but not
limited to, base salary and installments under the Plan) and
continue Employee as a participant in all compensation, benefit and
insurance plans in which he was participating when the notice giving
rise to the dispute was given, until the dispute is finally resolved
in accordance with Section 3.5 hereof. Amounts paid under this
paragraph are in addition to all other amounts due under this
Agreement and shall not be offset against or reduce any other
amounts due under this Agreement. Judgment may be entered on the
arbitrator's award in any court having jurisdiction; provided,
however, that Employee shall be entitled to seek specific
performance of his right to be paid until the Date of Termination
during the pendency of any dispute or controversy arising under or
in connection with this Agreement.
12. CAPTIONS AND GENDER. The use of captions and Section
headings herein is for the purposes of convenience only and shall
not effect the interpretation or substance of any provisions
contained herein. Similarly, the use of the masculine gender with
respect to pronouns in this Agreement is for purposes of convenience
and includes either sex who may be a signatory.
IN WITNESS WHEREOF, the parties hereto have signed this
Agreement as of the _____ day of ______________________, 19___.
TRITON ENERGY CORPORATION
By:______________________________________
Name:____________________________________
Title:___________________________________
(EMPLOYEE)
_________________________________________
TRITON ENERGY CORPORATION
AMENDED AND RESTATED
RESTRICTED STOCK PLAN
PURPOSES OF THE PLAN
The Plan is intended to provide a method whereby Employees of the
Company and its subsidiaries who are largely responsible for the
management, growth and protection of the business, and who are
presently making and are expected to continue making substantial
contributions to the successful growth of the Company, may be
offered additional incentives and may be stimulated by personal
involvement in the success of the Company to continue in the service
of the Company. The Plan is intended to encourage ownership of
Common Stock by Employees of the Company and its designated
subsidiaries and to provide additional incentives for the employees
to promote the success of the business of the Company and its
designated subsidiaries.
In order to maintain flexibility in the award of benefits under the
Plan, the Plan is comprised of two parts: the Restricted Plan and
the Purchase Plan. The Purchase Plan is intended to qualify as an
employee stock purchase plan within the meaning of Section 423 of
the Code.
The Plan and all transactions under the Plan are intended to comply
with all applicable conditions of Rule 16b-3 or its successors under
the Exchange Act. To the extent that any provision of the Plan or
action by the Board fails to so comply, it will be deemed null and
void, to the extent permitted by law and deemed advisable by the
Board.
Capitalized terms used herein are defined below in Section 1.2.
ARTICLE I
GENERAL PROVISIONS OF PLAN
Section 1.1 Applicability of General Provisions. Unless
otherwise expressly provided, the Restricted Plan and the Purchase
Plan shall be subject to the General Provisions of the Plan set
forth below.
Section 1.2 Definitions. As used in this Plan, the following
terms will have the meanings respectively assigned to them below:
a. "Board" shall mean the Board of Directors of the Company.
b. "Code" shall mean the Internal Revenue Code of 1986, as
amended.
c. "Common Stock" shall mean the common stock, $1.00 par
value per share, of the Company.
d. "Company" shall mean Triton Energy Corporation, a Texas
corporation.
e. "Committee" shall mean the Compensation Committee of the
Board, which shall consist of at least three members of
the Board, none of whom shall be an Employee and each of
whom shall qualify as a "disinterested person," as
defined in Rule 16b-3 promulgated under Section 16 of the
Exchange Act.
f. "Employee" shall mean an employee (including a director
who is also an employee) of the Company or any subsidiary
of the Company.
g. "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended.
h. "Option" shall mean an option to purchase shares of
Common Stock granted under the Purchase Plan.
i. "Plan" shall mean the Triton Energy Corporation Amended
and Restated Restricted Stock Plan.
j. "Purchase Plan" shall mean the portion of the Plan as it
relates to the grants of Options, as more fully described
in Article III of the Plan.
k. "Restricted Plan" shall mean the portion of the Plan as
it relates to the grants of Restricted Stock, as more
fully described in Article II of the Plan.
l. "Restricted Stock" shall mean Common Stock granted under
the Restricted Plan.
Section 1.3 Administration of the Plan. This Plan shall be
administered by the Committee. The Committee will have authority
to interpret the Plan, to prescribe, amend, and rescind rules and
regulations relating to the Plan, to determine the terms of Options
and Restricted Stock granted under the Plan, and to make all other
determinations necessary or advisable for the administration of the
Plan. All questions arising under the Plan and the determination
of such questions shall be made by the Committee and shall be final.
Section 1.4 Stock Subject to the Plan. The maximum aggregate
number of shares of Common Stock subject to the Plan shall be
50,000, subject to adjustments made in accordance with Section 1.9
and Section 3.10 of the Plan. Shares of Common Stock to be
distributed and sold under the Plan may be made available from
either authorized but unissued Common Stock or Common Stock held by
the Company in its treasury. If any Option expires or terminates
for any reason without having been exercised in full or if shares
of Restricted Stock are reacquired by the Company pursuant to the
provisions of Section 2.2 of the Plan, the shares not purchased or
distributed will again be available for issuance under the Plan.
Section 1.5 Effective Date of Plan. The Plan, as originally
adopted, became effective on August 21, 1984. The Plan, as amended
and restated, shall be effective on September 16, 1993, subject to
its approval by: (i) unanimous written consent of the shareholders
of the Company, or (ii) a majority of the shareholders of the
Company voting in person or by proxy at a meeting of shareholders,
which approval shall be obtained within twelve months of the such
date.
Section 1.6 Term of the Plan. Unless earlier terminated
pursuant to the provisions of Section 1.7, the Plan shall terminate
on September 15, 2003.
Section 1.7 Amendment, Suspension or Termination of the Plan in
Whole or in Part. The Board may amend, suspend or terminate the
Plan in whole or in part at any time; provided that no such
amendment, suspension or modification shall, without approval by the
holders of a majority of the outstanding shares of stock voting on
the question, increase the maximum number of shares purchasable and
reserved under Section 1.4 or extend the term of the Plan; and
provided further that without such shareholder approval, no
amendment to the Plan shall be effective that materially increases
the benefits accruing to participants in the Plan, materially
increases the number of securities that may be issued under the Plan
or materially modifies the requirements as to eligibility for
participation in the Plan, all within the meaning of Rule 16b-3
promulgated under the Exchange Act. No amendment, suspension or
termination of the Plan shall, without the consent of the Employee
who has received Restricted Stock or an Option, alter or impair any
of that Employee's shares of Restricted Stock or Options or the
Company's obligations with respect to any shares of Restricted Stock
or Options granted under the Plan prior to that amendment,
suspension or termination.
Section 1.8 Government Regulations. The Company may postpone
the issuance and delivery of shares of Common Stock under the Plan
in the event any applicable governmental actions, statutory or
otherwise, prohibit or make inadvisable such issuance and delivery.
As a condition to the exercise of any right given under the Plan,
the Company may require the person exercising such right to
represent and agree, by investment letter or other document in form
prescribed by the Committee, that he is acquiring the shares in
question for his own account for investment and not with a view to
or in connection with any distribution thereof. The Plan shall be
governed by the laws of the State of Texas.
Section 1.9 Adjustments. If the outstanding shares of Common
Stock of the Company are increased, decreased, changed into or
exchanged for a different number or kind of shares or securities
through merger, consolidation, combination, exchange of shares,
other reorganization, recapitalization, reclassification, stock
dividend, stock split or reverse stock split, an appropriate and
proportionate adjustment shall be made in the maximum number and
kind of shares as to which Restricted Stock and Options may be
granted under the Plan.
Section 1.10 Expenses of Administration. All costs and expenses
incurred in the operation and administration of the Plan shall be
borne by the Company.
Section 1.11 No Agreement to Employ. Nothing in the Plan shall
be construed as giving any Employee of the Company an agreement or
understanding, express or implied, that the Company shall continue
to employ any individual whether or not a participating Employee in
the Plan.
ARTICLE II
RESTRICTED PLAN
Section 2.1 Eligibility of Recipients. Shares of Restricted
Stock will be issued under this Restricted Plan only to persons who
are Employees on the date of issue. Subject to the terms,
provisions and conditions of this Restricted Plan, the Committee
shall have exclusive jurisdiction to select the Employees to whom
shares of Restricted Stock shall be issued under this Restricted
Plan, to determine the number of shares to be issued to each person
at each time, to determine the time or times when shares shall be
issued, and to prescribe the form, which shall be consistent with
this Restricted Plan, of the instruments evidencing any issuance
under this Restricted Plan and the legend, if any, to be affixed to
the stock certificates representing shares of Common Stock issued
under the Restricted Plan. Restricted Stock may be issued to the
same person on more than one occasion.
Section 2.2 Transfer Restrictions. Shares of Restricted Stock
issued to an Employee under this Restricted Plan shall not be sold,
transferred or otherwise disposed of and shall not be pledged or
otherwise hypothecated (any such sale, transfer or other
disposition, pledge or other hypothecation being referred to as "to
dispose of" or a "disposition"), and in the event of termination of
employment for any reason, such shares shall be returned to and
become the property of the Company, except as follows:
a. The obligation not to dispose of shares of Restricted
Stock acquired under this Restricted Plan and the right
of the Company to receive such shares pursuant to this
Section 2.2 (such obligation and right being referred to
collectively as the "restrictions") shall lapse as to 1/3
of such shares on the second anniversary date of the
effective date of issuance and as to an additional 1/3 of
the original amount of such shares on the third and
fourth anniversaries of the effective date of issuance of
such shares.
b. In the event of termination of employment by reason of
death, the restrictions shall lapse as of the date of an
Employee's death as to any shares that have not been
released in accordance with subsection a.
c. Termination of employment by reason of retirement (at
early, normal, or late retirement or for reasons of dis-
ability) under the Triton Energy Corporation Retirement
Income Plan (and its successors) with the consent of the
Company or the subsidiary by which the Employee is
employed shall not be considered a termination of
employment requiring a return of any shares to the
Company, and the restrictions on the shares shall lapse
as of the date of an Employee's retirement as to any
shares that have not been released from the restrictions
in accordance with subsection a.
d. In the event of termination of employment for any reason
other than death or retirement as specified in
subsections b. and c. above, the Committee may, in its
sole discretion, waive the restrictions set forth in this
Section 2.2 with respect to any or all of the restricted
shares if the Committee determines such waiver to be in
the best interest of the Company.
e. Notwithstanding the preceding provisions of this Section
2.2, all restrictions discussed herein shall lapse
automatically prior to the expiration of the restrictions
upon the occurrence of any of the following events: (i)
there shall be consummated (x) any consolidation or
merger of the Company in which the Company is not the
continuing or surviving corporation or pursuant to which
shares of the Company's Common Stock would be converted
into cash, securities or other property, other than a
merger of the Company in which the holders of the
Company's Common Stock immediately prior to the merger
have the same proportionate ownership of common stock of
the surviving corporation immediately after the merger,
or (y) any sale, lease, exchange or other transfer
(excluding transfer by way of pledge or hypothecation),
in one transaction or a series of related transactions,
of all or substantially all of the assets of the Company,
(ii) the shareholders of the Company approve any plan or
proposal for the liquidation or dissolution of the
Company, (iii) any "person" (as such term is defined in
Section 3(a)(9) or Section 13(d)(3) of the Exchange Act)
or any "group" (as such term is used in Rule 13d-5
promulgated under the Exchange Act), other than the
Company or any successor of the Company or any subsidiary
of the Company or any employee benefit plan of the
Company or any subsidiary (including such plan's
trustee), becomes, without the prior approval of the
Board, a beneficial owner for purposes of Rule 13d-3
promulgated under the Exchange Act, directly or
indirectly, of securities of the Company representing
25.0 percent or more of the Company's then outstanding
securities having the right to vote in the election of
directors of the Company, or (iv) during any period of
two consecutive years, individuals who, at the beginning
of such period constituted the entire Board, cease for
any reason (other than death) to constitute a majority of
the directors of the Company, unless the election, or the
nomination for election, by the Company's shareholders,
of each new director of the Company was approved by a
vote of at least two-thirds of the directors of the
Company then still in office who were directors of the
Company at the beginning of the period.
The Committee may require any Employee to whom shares of Restricted
Stock are issued to execute and deliver to the Company a stock power
in blank with respect to the shares issued and may require that the
Company retain possession of the certificates for shares with
respect to which the restrictions have not lapsed. Notwithstanding
retention of certificates by the Company, the Employee in whose name
certificates are issued shall have all rights (including dividend
and voting rights) with respect to the shares represented by such
certificates, subject to the terms, conditions and restrictions
specified under this Restricted Plan.
Section 2.3 Notice to Company of Employee's Election. Any
Employee who exercises the election under Section 83(b) of the Code
to have his receipt of shares of Restricted Stock taxed currently
without regard to the restrictions shall give notice to the Company
of such election immediately upon making the election. Such an
election must be made within thirty days of the effective date of
issuance and cannot be revoked except with the consent of the
Internal Revenue Service, as required by the Treasury Regulations.
A Statement of Election form is available from the Company.
Section 2.4 Issuance. The effective date of issuance and the
number of shares to be issued shall be specified in a letter from
the Company to each Employee to whom shares are issued.
Section 2.5 Withholding. The Company is authorized to withhold
any tax required to be withheld from the amount considered as
taxable compensation to the Employee. In the event that funds are
not otherwise available to cover any required withholding tax, the
Employee shall be required to provide such funds before shares shall
be issued to him.
ARTICLE III
PURCHASE PLAN
Section 3.1 Definitions. As used in this Purchase Plan, the
following terms will have the meanings respectively assigned to them
below:
a. "Base Compensation" shall mean annual or annualized base
compensation of an Eligible Employee, exclusive of
commissions, overtime pay, cash bonuses, contributions to
employee benefit plans, or other fringe benefits.
b. "Beneficiary" shall mean, in the event of the death of
the Optionee, the person or persons designated as
beneficiary in the Optionee's Payroll Deduction
Authorization or, if no such beneficiary is named, the
person or persons to whom the Option is transferred by
will or under the applicable laws of descent and
distribution.
c. "Compensation" shall mean Base Compensation or Gross
Compensation, as appropriate.
d. "Eligible Employee" shall mean a person who is eligible
under the provisions of Section 3.2 to receive an Option
as of a particular Offering Commencement Date.
e. "Gross Compensation" shall means Base Compensation plus
commissions, overtime pay and cash bonuses.
f. "Market Value" shall mean, as of a particular date, the
closing price of the Common Stock on the New York Stock
Exchange.
g. "Offering Commencement Date" shall mean the first Trading
Day of an Offering Period.
h. "Offering Period" shall mean a semi-annual period, either
January 1 to June 30 or July 1 to December 31.
i. "Offering Termination Date" shall mean the last Trading
Day of an Offering Period.
j. "Optionee" shall mean an Eligible Employee to whom an
Option is granted.
k. "Option Shares" shall mean shares of Common Stock
purchasable under an Option.
l. "Participating Employer" shall mean the Company or any
Related Corporations that have been designated by the
Board as corporations whose Eligible Employees may
receive Options. The following corporations have been
designated as Participating Employers for purposes of the
Plan: Triton Energy Corporation.
m. "Payroll Deduction Authorization" shall mean the
instrument by which an Optionee authorizes a
Participating Employer to withhold payroll deductions
from his Compensation and makes certain other elections
as provided therein.
n. "Related Corporation" shall mean any corporation that is
or during the term of the Purchase Plan becomes a parent
corporation of the Company, as defined in Section 424(e)
of the Code, or a subsidiary corporation of the Company,
as defined in Section 424(f) of the Code.
o. "Trading Day" shall mean a day on which the Common Stock
is traded on the New York Stock Exchange.
Section 3.2 Persons Eligible to Receive Options. Each Employee
of a Participating Employer will be granted an Option on each
Offering Commencement Date on which such Employee meets all of the
following requirements:
a. The Employee is customarily employed by a Participating
Employer for more than twenty hours per week and for more
than five months per calendar year and has been employed
by one or more Participating Employers for at least six
months (consecutive or nonconsecutive) prior to the
applicable Offering Commencement Date.
b. The Employee will not, after grant of the Option, own
stock possessing five percent or more of the total
combined voting power or value of all classes of stock of
the Company or of any Related Corporation. For purposes
of this subsection b., the rules of Section 424(d) of the
Code will apply in determining the stock ownership of the
Employee and Option Shares that the Employee may purchase
under outstanding Options will be treated as stock owned
by the Employee.
c. Upon grant of the Option, the Employee's rights to
purchase stock under all employee stock purchase plans
(as defined in Section 423(b) of the Code) of the Company
and all Related Corporations will not accrue at a rate
that exceeds $25,000 of fair market value of the Common
Stock (determined as of the grant date) for each calendar
year in which such Option is outstanding at any time.
The accrual of rights to purchase Common Stock will be
determined in accordance with Section 423(b)(8) of the
Code.
Section 3.3 Terms and Conditions of Options. All Options
granted on a particular Offering Commencement Date will comply with
the terms and conditions set forth in Sections 3.4 through 3.14 of
the Plan. Subject to subsection 3.2 c. and Section 3.12, each
Option granted on a particular Offering Commencement Date will
entitle the Optionee to purchase that number of Option Shares equal
to the result of $12,500 divided by the Market Value of one Option
Share on the Offering Commencement Date and then rounded down, if
necessary, to the nearest whole number.
Section 3.4 Purchase Price. The purchase price of Option Shares
will be 85 percent of the lesser of the following: (i) the Market
Value of the shares as of the Offering Commencement Date, or (ii)
the Market Value of the shares as of the Offering Termination Date.
Section 3.5 Restrictions on Transfer. Options may not be
transferred otherwise than by will or under the laws of descent and
distribution. An Option may not be exercised by anyone other than
the Optionee during the lifetime of the Optionee. Option Shares may
be sold or otherwise transferred by the Optionee without
restriction. The Optionee will agree in the Payroll Deduction
Authorization to notify the Company of any sale of the Option Shares
within two years after the Offering Commencement Date for those
Option Shares.
Section 3.6 Expiration. Each Option will expire at the close of
business on the applicable Offering Termination Date or on such
earlier date as may result from the operation of Section 3.7, below.
Section 3.7 Termination of Employment of Optionee. If an
Optionee ceases for any reason other than retirement or death to be
continuously employed by a Participating Employer, whether due to
voluntary severance, involuntary severance, transfer or
disaffiliation of a Related Corporation with the Company, his Option
will immediately expire and the Optionee's accumulated payroll
deductions will be returned by the Company. For purposes of this
Section 3.7, an Optionee will be deemed to be employed throughout
any leave of absence for military service, illness or other bona
fide purpose that does not exceed the longer of ninety days or the
period during which the Optionee's reemployment rights are
guaranteed by statute or by contract. If the Optionee does not
return to active employment prior to the termination of such period,
his employment will be deemed to have ended on the ninety-first day
of such leave of absence.
Section 3.8 Retirement of Optionee. If an Optionee retires
within three months after an Offering Commencement Date, the
Optionee's Option will immediately expire and the Optionee's
accumulated payroll deductions will be returned by the Company. If
an Optionee retires more than three months after an Offering
Commencement Date, the Optionee will be entitled to: (i) withdraw
the Optionee's accumulated payroll deductions, or (ii) purchase
Option Shares on the Offering Termination Date to the extent that
the Optionee would be so entitled had the Optionee continued to be
employed by a Participating Employer. The number of Option Shares
purchasable will be limited by the amount of the Optionee's
accumulated payroll deductions as of the date of the Optionee's
retirement.
Section 3.9 Death of Optionee. If an Optionee dies, the
Optionee's Beneficiary will be entitled to: (i) withdraw the
Optionee's accumulated payroll deductions, or (ii) purchase Option
Shares on the Offering Termination Date to the extent that the
Optionee would be so entitled had the Optionee continued to be
employed by a Participating Employer. The number of Option Shares
purchasable will be limited by the amount of the Optionee's
accumulated payroll deductions as of the date of the Optionee's
death. An Option will be deemed exercised only if the Beneficiary
submits to the Participating Employer a written request that the
Option be exercised. Accumulated payroll deductions not withdrawn
or applied to the purchase of Option Shares as of an Offering
Termination Date will be delivered by the Company to the Beneficiary
within a reasonable time after the Offering Termination Date.
Section 3.10 Capital Changes Affecting the Common Stock. In the
event that, between the Offering Commencement Date and the Offering
Termination Date of an Option, a stock dividend is paid or becomes
payable in respect of the Common Stock or there occurs a split-up
or contraction in the number of shares of Common Stock, the number
of shares for which the Option may thereafter be exercised and the
price to be paid for each such share will be proportionately
adjusted. In the event that, after the Offering Commencement Date,
there occurs a reclassification or change of outstanding shares of
Common Stock or a consolidation or merger of the Company with or
into another corporation or a sale or conveyance, substantially as
a whole, of the property of the Company, the Optionee will be
entitled on the Offering Termination Date to receive shares of stock
or other securities equivalent in kind and value to the shares of
stock he would have held if he had exercised the Option in full
immediately prior to such reclassification, change, consolidation,
merger, sale or conveyance and had continued to hold such shares
(together with all other shares and securities thereafter issued in
respect thereof) until the Offering Termination Date. In the event
that there is to occur a recapitalization involving an increase in
the par value of the Common Stock that would result in a par value
exceeding the exercise price under an outstanding Option, the
Company will notify the Optionee of such proposed recapitalization
immediately upon its being recommended by the Board to the Company's
stockholders, after which the Optionee will have the right to
exercise his Option prior to such recapitalization; if the Optionee
fails to exercise the Option prior to recapitalization, the exercise
price under the Option will be appropriately adjusted. In the event
that, after the Offering Commencement Date, there occurs a
dissolution or liquidation of the Company, except pursuant to a
transaction to which Section 424(a) of the Code applies, each Option
will terminate, but the Optionee will have the right to exercise his
Option prior to such dissolution or liquidation.
Section 3.11 Payroll Deductions. An Optionee may purchase Option
Shares under an Option during any particular Offering Period by
completing and returning to the Human Resources Department of the
Company at least ten days prior to the beginning of such Offering
Period a Payroll Deduction Authorization indicating a percentage
(which will be a full integer between one and fifteen) of either his
Gross Compensation or his Base Compensation that is to be withheld
each pay period; provided that once a Payroll Deduction
Authorization is received by the Human Resources Department it will
continue to be effective for all Offering Periods until it is
changed or terminated by submitting an additional Payroll Deduction
Authorization. The Optionee will not be permitted to change the
percentage of Compensation withheld during an Offering Period. The
Optionee may withdraw any or all of his accumulated payroll
deductions by submitting a written request to the Human Resources
Department of the Company no later than two weeks prior to the
Offering Termination Date. The percentage of Compensation withheld
may be changed from one Offering Period to another.
Section 3.12 Exercise of Options. On the Offering Termination
Date, the Optionee will purchase the number of Option Shares
purchasable by his accumulated payroll deductions, or, if less, the
maximum number of Option Shares subject to the Option as provided
in Section 3.3; provided, that:
a. If the total number of Option Shares that all Optionees
elect to purchase, together with any Option Shares
already purchased under the Purchase Plan, exceeds the
total number of Option Shares that may be purchased under
the Purchase Plan pursuant to the Plan, the number of
Option Shares that each Optionee is permitted to purchase
will be decreased pro rata based on the Optionee's
accumulated payroll deductions in relation to all
accumulated payroll deductions withheld under the
Purchase Plan during the Offering Period.
b. If the number of Option Shares purchasable includes a
fraction, such number may be adjusted to the next smaller
whole number and the purchase price may be adjusted
accordingly or the Option Shares may be purchased in
fractional shares as determined by the Committee.
Subject to Section 3.9, accumulated payroll deductions not withdrawn
prior to the Offering Termination Date pursuant to Section 3.11 will
be applied automatically by the Company toward the purchase of
Option Shares or, to the extent in excess of the aggregate purchase
price of the Option Shares then purchasable by the Optionee,
refunded to the Optionee.
Section 3.13 Delivery of Common Stock. Within a reasonable time
after the Offering Termination Date, the Company will deliver or
cause to be delivered to or for the account of the Optionee a
certificate or certificates for the number of Option Shares
purchased by the Optionee as of such Offering Termination Date. A
stock certificate representing the number of Option Shares purchased
will be issued in the name or for the account of the Optionee (or
in the event of the death of the Optionee, in the name or for the
account of the Beneficiary), or if the Optionee's Payroll Deduction
Authorization so specifies, in the name or for the account of the
Optionee and another person of legal age as joint tenants with right
of survivorship. If any law or applicable regulation of the
Securities and Exchange Commission or other body having jurisdiction
requires that the Company or the Optionee take any action in
connection with the Option Shares being purchased under the Option,
delivery of the certificate or certificates for such Option Shares
will be postponed until the necessary action has been completed,
which action will be taken by the Company at its own expense,
without unreasonable delay. The Optionee will have no rights as a
stockholder in respect of Option Shares for which he has not
received a certificate. At the direction of the Committee,
certificates representing Option Shares may be held in "street name"
by the agent selected by the Committee to assist with the
administration of the Plan. Any shares so held shall be deemed to
have been received by the Optionee at the time such shares are
reflected on the books and records of the Committee's agent.
Section 3.14 Return of Accumulated Payroll Deductions. In the
event that the Optionee or the Beneficiary is entitled to the return
of accumulated payroll deductions, whether by reason of voluntary
withdrawal, termination of employment, retirement, death or in the
event that accumulated payroll deductions exceed the price of Option
Shares purchased, such amount will be returned within a reasonable
time by the Company to the Optionee or the Beneficiary, as the case
may be. Accumulated payroll deductions held by the Company will not
bear interest.
GUARANTY
For value received the undersigned ("Guarantor")
unconditionally and absolutely guarantees payment to Comerica
Bank-Texas of the City of Dallas, State of Texas, and its
assigns (the "Noteholder"), the certain indebtedness in the
amount of $1,300,000.00 evidenced by the Promissory Note
("Note") dated December 10, 1993, with Thomas G. Finck and
Carole C. Finck being the Maker and all amounts to become due
and owing thereunder, including, but not limited to, principal,
interest and attorneys' fees.
Guarantor waives diligence on the part of Noteholder and its
assigns in the collection of said indebtedness and agrees that
said Noteholder shall be under no obligation to notify Guarantor
of the acceptance hereof or any renewals or extensions of said
indebtedness. Guarantor further expressly waives all notices,
demands for payment, presentations for payment, notices of
intention to accelerate the maturity, notices of the election to
accelerate the maturity, protests and notices of protests, as to
the indebtedness covered hereby and as to each, every and all
installments thereof, whether before or after such installments
are due.
This Guaranty is in addition to such other security, if any, as
Noteholder now or hereafter may have. Noteholder may surrender
or release all or any part of such other security without in any
way affecting Guarantor's liability hereunder. It shall not be
necessary for Noteholder in order to enforce payment by
Guarantor of said indebtedness, to first institute suit or
pursue or exhaust its remedies against Maker, or against any
other security which Noteholder may have.
Guarantor agrees that this Guaranty shall continue in full
force and effect notwithstanding the death, release by agreement
or by operation of law, or the extension of time to any other
Guarantor or Guarantors. This Guaranty shall also be binding on
Guarantor, Guarantor's successors and assigns.
If Noteholder enforces payment by Guarantor under this Guaranty
by suit or through bankruptcy or probate, or in any court,
either before or after maturity of the Note, then in any of said
events, a reasonable amount will be added and collected as
attorney and collection fees, which upon accrual will bear the
same rate of interest as called for in the Note hereby
guaranteed.
If either Guarantor or Maker makes an assignment for the
benefit of creditors, or if a receiver is appointed for any port
of the Mortgaged Premises, or if either Guarantor or Maker is
adjudicated a bankrupt, or if Guarantor or Maker institute any
proceedings under the Federal Bankruptcy Laws of the United
States, then on the happening of one of these events the whole
of said debt hereby guaranteed shall immediately become due and
payable, at the option of Noteholder and Noteholder may proceed
to enforce the terms hereof. Bankruptcy of Maker shall not
affect the liability of Guarantor for the full amount of the
indebtedness then due plus interest and attorneys' fees as
provided in the Note and in this Guaranty.
This agreement is to be performed in the County of Dallas,
State of Texas, and any suit hereon or for any breach hereof,
may be brought and prosecuted in the courts of said county.
It is understood and agreed that in no event and upon no
contingency shall the Guarantor be considered Maker of the Note
hereby guaranteed and it is further agreed that the Guarantor
shall not be required to pay interest in excess of the rate for
which parties may contract under the laws of the State of Texas
or of the United States of America, whichever is controlling.
If said laws are ever revised, repealed or judicially
interpreted so as to render usurious any amount contracted for,
charged or received as a result of this Guaranty or if the
Noteholder's acceleration of the maturity of the Note results in
the Guarantor having paid interest in excess of hat permitted by
law, then it is both the Guarantor's and Noteholder's express
intent that all excess amounts be credited to last maturing
installments of principal due ad the rate of interest called for
in the Note be reduced to highest allowable rate permitted under
the then applicable law.
Guarantor understands and agrees that without notice to or
further assent by Guarantor, the obligation of Maker may be
renewed, extended, modified, accelerated, or released by
Noteholder as Noteholder may deem advisable in its sole
discretion and Guarantor hereby gives its consent to any such
change stated hereinabove and that any security, security
interest or collateral other than this Guaranty which Noteholder
may hold or in which Noteholder may have an interest may be
exchanged, sold, released or surrendered by Noteholder as it may
deem advisable in its sole discretion without impairing or
affecting the obligation of Guarantor hereunder in any way
whatsoever.
Each guarantor also hereby waives any claims, right or remedy
which such guarantor may now have or hereafter acquire against
Thomas G. Finck or Carole C. Finck that arises hereunderand/or
from the performance by any guarantor hereunder including,
without limitation, any claim, remedy or right of subrogation,
reimbursement, exoneration, contribution, indemnification, or
participation in any claim, right or remedy arises in equity,
under contract, by statute, under common law or otherwise.
EXECUTED this 10th day of December 1993.
TRITON ENERGY CORPORATION, a Texas
corporation
By: \s\ Robert B. Holland, III
TRITON ENERGY CORPORATION
401(K) SAVINGS PLAN
as amended and restated
effective January 1, 1994
PREAMBLE
The purpose of this Plan and Trust is to provide, in accordance with its
provisions, a defined contribution plan providing retirement and other related
benefits for those Employees of the Employer who are eligible to participate
hereunder. This document is a complete amendment and restatement of the
Triton Energy Corporation Employee Stock Ownership Plan which was originally
effective as of May 31, 1976.
It is intended that the Plan qualify for approval under Sections 401 and 410
through 417 of the Internal Revenue Code. It is intended that the Trust
qualify for approval under Section 501 of the Code. It is further intended
that the Plan comply with the provisions of the Employee Retirement Income
Security Act of 1974 (ERISA). In case of any ambiguity in the Plan's
language, it will be interpreted to accomplish the Plan's intent of qualifying
under the Code and complying with ERISA.
This Plan and Trust is exclusively for the benefit of the eligible Employees
and their Beneficiaries. Neither the Employer, the Plan Administrator nor the
Trustee will apply or interpret the terms of the Plan in any manner that
permits discrimination in favor of Highly Compensated Employees. All
Employees under similar circumstances will be treated alike.
The undersigned Employer and Trustee hereby adopt this restatement of the
Triton Energy Corporation 401(k) Savings Plan to be effective as of January 1,
1994.
TABLE OF CONTENTS
PAGE NO.
--------
ARTICLE 1 - DEFINITIONS 1-1
ARTICLE 2 - PARTICIPATION 2-1
ARTICLE 3 - PARTICIPANT ACCOUNTS 3-1
ARTICLE 4 - ACCOUNTING AND VALUATION 4-1
ARTICLE 5 - RETIREMENT BENEFITS 5-1
ARTICLE 6 - DEATH BENEFIT 6-1
ARTICLE 7 - LIMITATIONS ON BENEFITS 7-1
ARTICLE 8 - MISCELLANEOUS 8-1
ARTICLE 9 - ADMINISTRATION 9-1
ARTICLE 10 - AMENDMENT OR TERMINATION
OF PLAN 10-1
ARTICLE 11 - TRUSTEE AND TRUST FUND 11-1
ARTICLE 1
DEFINITIONS
As used in this document, unless otherwise defined or required by the context,
the following terms have the meanings set forth in this Article 1. Some of
the terms used in this document are not defined in Article 1, but for
convenience are defined as they are introduced in the text.
1.01 Account
Account means a separate account maintained for each Participant
reflecting applicable contributions, applicable forfeitures, investment
income (loss) allocated to the account and distributions.
1.02 Accounting Date, Valuation Date
The terms Accounting Date and Valuation Date are used interchangeably
and mean the last day of each Accounting Period and any other days
within the Accounting Period upon which, consistent with established
methods and guidelines, the Plan Administrator applies the accounting
procedures specified in Section 4.02.
1.03 Accounting Period, Valuation Period
The terms Accounting Period and Valuation Period are used
interchangeably and mean each month.
1.04 Accrued Benefit
A Participant's Accrued Benefit means the total value, as of a given
date, of his Accounts determined as of the Valuation Date immediately
preceding the date of determination plus any other amounts withheld from
the Participant's Compensation subsequent to such Valuation Date
pursuant to a Payroll Withholding Agreement. A Participant's Accrued
Benefit will not be reduced solely on account of any increase in such
Participant's age or service or on account of an amendment to the Plan.
A Participant's Vested Accrued Benefit is equal to his Vested Percentage
of that portion of his Accrued Benefit which is subject to the Vesting
Schedule plus 100% of the remaining portion of his Accrued Benefit.
1.05 Beneficiary
Beneficiary means the person, persons, trust or other entity who is
designated to receive any amount payable upon the death of a
Participant.
1.06 Cash-Out Distribution
Cash-Out Distribution means, as described in Article 5, a distribution
to a Participant upon termination of employment of his Vested Accrued
Benefit.
1.07 Code and ERISA
Code means the Internal Revenue Code of 1986, as it may be amended from
time to time, and all regulations issued thereunder. Reference to a
section of the Code includes that section and any comparable section or
sections of any future legislation that amends, supplements or
supersedes such section and any regulations issued thereunder.
1-1
ERISA means Public Law No. 93-406, the Employee Retirement Income
Security Act of 1974, as it may be amended from time to time, and all
regulations issued thereunder. Reference to a section of ERISA includes
that section and any comparable section or sections of any future
legislation that amends, supplements or supersedes such section and any
regulations issued thereunder.
1.08 Compensation
Except where otherwise specifically provided in this Plan, Compensation
means Aggregate Compensation as defined in Section 7.03(a), excluding
bonuses and severance pay.
Compensation also includes any amounts contributed by the Employer or
any Related Employer on behalf of any Employee pursuant to a salary
reduction agreement which are not includable in the gross income of the
Employee due to Code Section 125, 402(a)(8), 402(h) or 403(b).
Notwithstanding the foregoing, for all purposes under this Plan,
Compensation in excess of $200,000 (as adjusted in accordance with Code
Section 401(a)(17)) will be disregarded. For purposes of applying this
compensation limit, a Family Member of a Highly Compensated Employee is
subject to the single aggregate compensation limit imposed on the Highly
Compensated Employee if the Family Member is either the Employee's
spouse or is a lineal descendant who has not attained the age of 19 by
the end of the Plan Year.
1.09 Effective Date
The Effective Date of the Plan is May 31, 1976.
Except as specified elsewhere in this document, the effective date of
this restatement of the Plan is January 1, 1994.
Sections 1.12, 1.18, 1.32, 1.33, 1.36, and Article 7 are effective
January 1, 1987.
1.10 Eligible Employee Classification
An Eligible Employee Classification is a classification of Employees,
the members of which are eligible to participate in the Plan. The Plan
covers all employee classifications except Leased Employees, Temporary
Employees and members of a legally recognized collective bargaining unit
who are not expressly granted permission to participate.
1.11 Eligible Participant
All Participants are Eligible Participants with respect to the receipt
of Triton Matching Contributions.
1.12 Employee
(a) In General
An Employee is any person who is employed by the Employer or a
Participating Employer.
(b) Leased Employee
1-2
A Leased Employee means any person who, pursuant to an agreement
between the Employer or any Related Employer ("Recipient Employer")
and any other person ("leasing organization"), has performed
services for the Recipient Employer on a substantially full-time
basis for a period of at least one year and such services are of a
type historically performed by employees in the business field of
the Recipient Employer.
Any Leased Employee will be treated as an Employee of the Recipient
Employer; however, contributions or benefits provided by the leasing
organization which are attributable to the services performed for
the Recipient Employer will be treated as provided by the Recipient
Employer. If all Leased Employees constitute less than 20% of the
Employer's non-highly-compensated work force within the meaning of
Code Section 414(n)(1)(C)(ii), then the preceding sentence will not
apply to any Leased Employee if such Employee is covered by a money
purchase pension plan ("Safe Harbor Plan") which provides: (1) a
nonintegrated employer contribution rate of at least 10% of
compensation, (2) immediate participation, and (3) full and
immediate vesting.
Years of Service for purposes of eligibility to participate in the
Plan and Years of Vesting Service for purposes of determining a
Participant's Vested Percentage include service by an Employee as a
Leased Employee.
1.13 Employer
The Employer and Plan Sponsor is Triton Energy Corporation. A
Participating Employer is any organization which has adopted this Plan
and Trust in accordance with Section 8.07.
The term Predecessor Employer means any prior employer to which the
Employer is the successor, including any Predecessor Employer for which
the Employer maintains the obligations of a Predecessor Plan established
by the Predecessor Employer. Service with a Predecessor Employer will
be included as Service with the Employer for all purposes under this
Plan.
1.14 Employment Commencement Date
The date an Employee first performs an Hour of Service for the Employer
is his Employment Commencement Date.
1.15 Entry Date
Entry Date means the January 1st, April 1st, July 1st or October 1st
which coincides with or next follows an Employee's Employment
Commencement Date.
1.16 Fiscal Year
Fiscal Year means the taxable year of the Plan Sponsor. The Fiscal Year
of the Plan Sponsor is the 12 month period beginning June 1 and ending
May 31.
1-3
1.17 Forfeiture
The term Forfeiture refers to that portion, if any, of a Participant's
Accrued Benefit which is in excess of his Vested Accrued Benefit
following the termination of the Participant's employment.
A Forfeiture is considered to occur as of the earlier of (a) the date of
the occurrence of the fifth of 5 consecutive One Year Breaks-in-Service
or (b) the date a Cash-Out Distribution occurs in accordance with the
provisions of Article 5.
1.18 Highly Compensated Definitions
(a) Compensation
For purposes of this Section, Compensation means Aggregate
Compensation as defined in Section 7.03(a) plus amounts contributed
by the Employer pursuant to a salary reduction agreement which are
excludable from the gross income of the Employee under Code Section
125, 402(a)(8), 402(h) or 403(b). Compensation in excess of
$200,000 (as adjusted by the Secretary of the Treasury under Code
Section 415(d)) is disregarded.
(b) Determination Year
Determination Year means the Plan Year for which the determination
of who is Highly Compensated is being made.
(c) Family Member
Family Member means an Employee who is the spouse, a lineal
ascendant or descendant, or the spouse of a lineal ascendant or
descendant of:
o a 5-percent owner (within the meaning of Code Section 416(i)) of
the Employer or any Related Employer who is an active or former
Employee; or
o a Highly Compensated Employee who is one of the 10 most highly
compensated employees ranked on the basis of Compensation paid
by the Employer during the Determination Year or the Lookback
Year.
For purposes of this Section, the Family Member and the Highly
Compensated Employee will be considered one Employee. A Family
Member's Compensation and benefits will be aggregated with those of
the Highly Compensated Employee irrespective of whether the Family
Member would otherwise be treated as a Highly-Compensated Employee
or is in a category of Employees which may be excluded in
determining the number of Employees in the Top-Paid Group.
If an Employee is required to be aggregated as a member of more than
one family group, all eligible employees who are members of those
family groups which include that employee will be aggregated as one
family group.
For purposes of applying the compensation limit under Code Section
401(a)(17), a Family Member is subject to the single aggregate
1-4
compensation limit imposed on the Highly Compensated Employee if the
Family Member is either the Employee's spouse or is a lineal
descendant who has not attained the age of 19 by the end of the Plan
Year.
(d) Highly Compensated Employee
Highly Compensated Employee means any individual who is a Highly
Compensated Active Employee or a Highly Compensated Former Employee
within the meaning of Code Section 414(q) and the regulations
thereunder.
(e) Highly Compensated Active Employee
Highly Compensated Active Employee means any individual who during
the Determination Year or the Lookback Year:
(1) Was at any time a 5-percent Owner (within the meaning of Code
Section 416(i)) of the Employer or any Related Employer;
(2) Received Compensation from the Employer and all Related
Employers in excess of $75,000 (or any greater amount determined
by regulations issued by the Secretary of the Treasury under
Code Section 415(d));
(3) Received Compensation from the Employer and all Related
Employers in excess of $50,000 (or any greater amount determined
by regulations issued by the Secretary of the Treasury under
Code Section 415(d)) and was in the Top-Paid Group of Employees;
or
(4) Was an Officer of the Employer or any Related Employer (as that
term is defined in the regulations under Code Section 416(i))
and received Compensation greater than 50% of the Defined
Benefit Dollar Limit described in Section 7.03(f) for the
applicable year. For this purpose, if no Officer received
enough Compensation to be a Highly Compensated Employee under
the preceding sentence, the highest-paid Officer will be treated
as a Highly Compensated Employee. The maximum number of
Officers who will be treated as Highly Compensated Active
Employees under this paragraph is equal to 10% of all Employees
determined without regard to statutory or other exclusions,
subject to a minimum of 3 Employees and a maximum of 50
Employees.
No individual described in subparagraphs (2), (3) or (4) above will
be treated as a Highly Compensated Active Employee for the
Determination Year unless he (i) was a Highly Compensated Active
Employee for the Lookback Year (or would have been except that he
was not among the 100 most highly compensated Employees of the
Employer and all Related Employers for the Lookback Year) or (ii)
was among the 100 most highly compensated Employees of the Employer
and all Related Employers for the Determination Year.
1-5
(f) Highly Compensated Former Employee
Highly Compensated Former Employee means any Former Employee who had
a Separation Year (within the meaning of Treasury Regulation Section
1.414(q)-1T Q&A-5) and was a Highly Compensated Active Employee for
either the Separation Year or any Determination Year ending on or
after the Employee's 55th birthday.
(g) Highly Compensated Group
Highly Compensated Group means all Highly Compensated Employees.
(h) Lookback Year
Lookback Year means the 12-month period immediately preceding the
Determination Year.
(i) Non-Highly Compensated Employee
Non-Highly Compensated Employee means an Employee who is neither a
Highly Compensated Employee nor a Family Member.
(j) Non-Highly Compensated Group
Non-Highly Compensated Group means all Non-Highly Compensated
Employees.
(k) Top-Paid Group
Top-Paid Group means those individuals who are among the top 20
percent of Employees of the Employer and all Related Employers when
ranked on the basis of Compensation received during the year. In
determining the number of individuals in the Top-Paid Group (but not
the identity of those individuals), the following individuals may be
excluded:
(1) Employees who have not completed 6 months of Service by the end
of the year. For this purpose, an Employee who has completed
One Hour of Service in any calendar month will be credited with
one month of Service;
(2) Employees who normally work fewer than 17 1/2 hours per week;
(3) Employees who normally work fewer than 6 months during any
year. For this purpose, an Employee who has worked on one day
of a month is treated as having worked for the whole month;
(4) Employees who have not reached age 21 by the end of the year;
(5) Nonresident aliens who received no earned income (which
constitutes income from sources within the United States) within
the year from the Employer or any Related Employer; and
(6) Employees covered by a collective bargaining agreement
negotiated in good faith between the employee representatives
and the Employer or a group of employers of which the Employer
is a member if (i) 90% or more of all employees of the Employer
and all Related Employers are covered by collective bargaining
agreements, and (ii) this Plan covers only Employees who are not
covered under a collective bargaining agreement.
1-6
1.19 Hour of Service
An Hour of Service means:
(a) Each hour for which an Employee is paid, or entitled to payment, for
the performance of duties for the Employer. These hours will be
credited to the Employee for the computation period in which the
duties are performed;
(b) Each hour for which an Employee is paid, or entitled to payment, by
the Employer on account of a period of time during which no duties
are performed (irrespective of whether the employment relationship
has terminated) due to vacation, holiday, illness, incapacity
(including disability), layoff, jury duty, military duty or leave of
absence. No more than 501 Hours of Service will be credited under
this paragraph for any 12-month period. Hours under this paragraph
will be calculated and credited pursuant to Section 2530.200b-2 of
the Department of Labor Regulations which are incorporated herein by
this reference; and
(c) Each hour for which back pay, irrespective of mitigation of damages,
is either awarded or agreed to by the Employer. The same Hours of
Service will not be credited both under paragraphs (a) or (b), as
the case may be, and under this paragraph (c). These hours will be
credited to the Employee for the computation period or periods to
which the award or agreement pertains rather than the computation
period in which the award, agreement or payment is made.
Hours of Service for all Employees will be determined on the basis of
actual hours for which an Employee is paid or is entitled to payment.
Hours of Service will be credited for employment with any Related
Employer or any Predecessor Employer. Hours of Service will be credited
for any individual considered an employee under Code Section 414(n) or
414(o) and the regulations thereunder.
Solely for purposes of determining whether a One Year Break-in-Service
has occurred, a Participant who is absent from work on an authorized
Leave of Absence or by reason of the Participant's pregnancy, birth of
the Participant's child, placement of a child with the Participant in
connection with the adoption of such child, or for the purpose of caring
for such child for a period immediately following such birth or
placement, will receive credit for the Hours of Service which otherwise
would have been credited to the Participant but for such absence. The
Hours of Service credited under this paragraph will be credited in the
Plan Year in which the absence begins if such crediting is necessary to
prevent a One Year Break-in-Service in such Plan Year; otherwise, such
Hours of Service will be credited in the following Plan Year. The Hours
of Service credited under this paragraph are those which would normally
have been credited but for such absence; in any case in which the Plan
Administrator is unable to determine such hours normally credited, 8
Hours of Service per day will be credited. No more than 501 Hours of
Service will be credited under this paragraph for any 12-month period.
The Date of Severance is the second anniversary of the date on which the
absence begins. The period between the initial date of absence and the
1-7
first anniversary of the initial date of absence is deemed to be a
period of Service. The period between the first and second
anniversaries of the initial date of absence is neither a period of
service nor a period of severance.
1.20 Investment Fund
An Investment Fund means any portion of the assets of the Trust Fund
which the Plan Administrator designates as an Investment Fund and for
which the Plan Administrator maintains a set of accounts separate from
the remaining assets of the Trust Fund.
(a) Specific Investment Fund means an Investment Fund which is
designated as a Specific Investment Fund by the Plan Administrator
in a manner and form acceptable to the Trustee.
(b) General Investment Fund means all assets of the Trust Fund excluding
the assets of any Specific Investment Funds.
1.21 Leave of Absence
An authorized Leave of Absence means a period of time of one year or
less granted to an Employee by the Employer due to illness, injury,
temporary reduction in work force, or other appropriate cause or due to
military service during which the Employee's reemployment rights are
protected by law, provided the Employee returns to the service of the
Employer on or before the expiration of such leave, or in the case of
military service, within the time his reemployment rights are so
protected or within 60 days of his discharge from military service if no
federal law is applicable. All authorized Leaves of Absence are granted
or denied by the Employer in a uniform and nondiscriminatory manner,
treating Employees in similar circumstances in a like manner.
If the Participant does not return to active service with the Employer
on or prior to the expiration of his authorized Leave of Absence he will
be considered to have had a Date of Severance as of the earlier of the
date on which his authorized Leave of Absence expired, the first
anniversary of the last date he worked at least one hour as an Active
Participant, or the date on which he resigned or was discharged.
1.22 Reserved
1.23 Normal Retirement Age
A Participant's Normal Retirement Age is his attained age on the date
which he satisfies the following requirements:
(a) Attainment of age 65, and
(b) Attainment of the fifth anniversary of the Participant's Employment
Commencement Date.
1.24 Normal Retirement Date
A Participant's Normal Retirement Date is the first day of the month
which coincides with or next follows the date on which the Participant
attains Normal Retirement Age.
1-8
1.25 One Year Break-in-Service
One Year Break-in-Service means any 365-day period following a
Participant's Date of Termination in which an Employee does not complete
at least one Hour of Service.
1.26 Participant
The term Participant means an Employee or former Employee who is
eligible to participate in this Plan and who is or who may become
eligible to receive a benefit of any type from this Plan or whose
Beneficiary may be eligible to receive any such benefit.
(a) Active Participant means a Participant who is currently an Employee
in an Eligible Employee Classification.
(b) Disabled Participant means a Participant who has terminated his
employment with the Employer due to his Disability and who is
receiving or is entitled to receive benefits from the Plan.
(c) Retired Participant means a Participant who has terminated his
employment with the Employer after meeting the requirements for his
Normal Retirement Date and who is receiving or is entitled to
receive benefits from the Plan.
(d) Vested Terminated Participant means a Participant who has terminated
his employment with the Employer and who has a nonforfeitable right
to all or a portion of his or her Accrued Benefit and who has not
received a distribution of the value of his or her Vested Accrued
Benefit.
(e) Inactive Participant means a Participant who has (i) interrupted his
status as an Active Participant without becoming a Disabled, Retired
or Vested Terminated Participant and (ii) has a non-forfeitable
right to all or a portion of his Accrued Benefit and has not
received a complete distribution of his benefit.
(f) Former Participant means a Participant who has terminated his
employment with the Employer and who currently has no nonforfeitable
right to any portion of his or her Accrued Benefit.
1.27 Payroll Withholding Agreement
If a written Payroll Withholding Agreement is required pursuant to the
provisions of Article 3, then each Participant who elects to participate
in the Plan will file such agreement on or before the first day of the
payroll period for which the agreement is applicable (or at some other
time as specified by the Plan Administrator). Such agreement will be
effective for each payroll period thereafter until modified or amended.
The terms of such agreement will provide that the Participant agrees to
have the Employer withhold, each payroll period, any whole percentage of
his Compensation (or such other amount as allowed by the Plan
Administrator under rules applied on a uniform and nondiscriminatory
basis), not to exceed the limitations of Article 7. In consideration of
such agreement, the Employer periodically will make a contribution to
the Participant's proper Account(s) in an amount equal to the total
1-9
amount by which the Participant's Compensation from the Employer was
reduced during applicable payroll periods pursuant to the Payroll
Withholding Agreement.
Notwithstanding the above, Payroll Withholding Agreements will be
governed by the following general guidelines:
(a) A Payroll Withholding Agreement will apply to each payroll period
during which an effective agreement is on file with the Employer.
Upon termination of employment, such agreement will become void.
(b) The Plan Administrator will establish and apply guidelines
concerning the frequency and timing of amendments or changes to
Payroll Withholding Agreements. Notwithstanding the foregoing, a
Participant may revoke his Payroll Withholding Agreement at any time
and discontinue all future withholding.
(c) The Plan Administrator may amend or revoke its Payroll Withholding
Agreement with any Participant at any time, if the Employer
determines that such revocation or amendment is necessary to insure
that a Participant's Annual Additions for any Plan Year will not
exceed the limitations of Article 7 or to insure that the
requirements of Sections 401(k) and 401(m) of the Code have been
satisfied with respect to the amount which may be withheld and
contributed on behalf of the Highly Compensated Group.
(d) Except as provided above, a Payroll Withholding Agreement may not be
revoked or amended by the Participant or the Employer.
1.28 Plan, Plan and Trust, Trust
The terms Plan, Plan and Trust and Trust mean Triton Energy Corporation
401(k) Savings Plan. The Plan Identification Number is 001. The Plan
is a profit sharing plan.
The term Predecessor Plan means any qualified plan previously
established and maintained by the Employer and to which this Plan is the
successor.
1.29 Plan Administrator
The Plan Administrator is the Plan Committee.
1.30 Plan Year
The Plan Year is the 12 month period beginning January 1 and ending
December 31.
Prior to December 31, 1993, Plan Year means the 12 month period
beginning June 1 and ending May 31. The period beginning June 1, 1993
and ending December 31, 1993 is a short Plan Year.
The Limitation Year is the 12 month period beginning January 1 and
ending December 31.
1.31 Reserved
1-10
1.32 Qualified Election
Qualified Election means the designation of a specific Beneficiary other
than the Participant's Surviving Spouse. Such Qualified Election must
be in writing and must be consented to by the Participant's spouse. The
spouse's written consent to a Qualified Election must be witnessed by a
representative of the Plan Administrator or a notary public. Such
consent will not be required if the Participant establishes to the
satisfaction of the Plan Administrator that such written consent may not
be obtained because there is no spouse, the spouse cannot be located or
other circumstances that may be prescribed by Treasury Regulations. Any
consent necessary under this provision will be valid only with respect
to the spouse who signs the consent (or in the event of a deemed
Qualified Election, the designated spouse). Additionally, a revocation
of a prior Qualified Election may be made by a Participant without the
consent of the spouse at any time before the commencement of benefits;
however, any Qualified Election which follows such revocation must be in
writing and must be consented to by the Participant's spouse. The
number of Qualified Elections or revocations of such Qualified Elections
will not be limited.
1.33 Related Employer
The terms Related Employer and Affiliated Employer are used
interchangeably and mean any other corporation, association, company or
entity on or after the Effective Date which is, along with the Employer,
a member of a controlled group of corporations (as defined in Code
Section 414(b)), a group of trades or businesses which are under common
control (as defined in Code Section 414(c)), an affiliated service group
(as defined in Code Section 414(m)), or any organization or arrangement
required to be aggregated with the Employer by Treasury Regulations
issued under Code Section 414(o).
1.34 Required Beginning Date
A Participant's Required Beginning Date for the commencement of benefit
payments from the Plan is the April 1 immediately following:
o the later of 1989 or the calendar year in which he attained age
70-1/2 if he attained age 70-1/2 after December 31, 1987;
o the calendar year in which he attains age 70-1/2 if he is or was a
Five Percent Owner at any time during the Plan Year ending with or
within the calendar year in which he attains age 66-1/2 or any later
Plan Year; or
o the later of the calendar year in which he attains age 70-1/2 or the
calendar year in which he retires for any other Participant.
1.35 Surviving Spouse
Surviving Spouse means a deceased Participant's spouse who was married
to the Participant on the Participant's date of death. The Plan
Administrator and the Trustee may rely conclusively on a Participant's
written statement of his marital status. Neither the Plan Administrator
nor the Trustee is required at any time to inquire into the validity of
any marriage, the effectiveness of a common-law relationship or the
claim of any alleged spouse which is inconsistent with the Participant's
1-11
report of his marital status and the identity of his spouse.
1.36 Top-Heavy Definitions
(a) Aggregate Account
Aggregate Account means, with respect to each Participant, the value
of all accounts maintained on behalf of the Participant, whether
attributable to Employer or Employee contributions, used to
determine Top-Heavy Plan status under the provisions of a defined
contribution plan. A Participant's Aggregate Account as of the
Determination Date will be the sum of:
o the balance of his Account(s) as of the most recent valuation
date occurring within a 12-month period ending on the
Determination Date (excluding any amounts attributable to
deductible voluntary employee contributions); plus
o contributions that would be allocated as of a date not later
than the Determination Date, even though those amounts are not
yet made or required to be made; plus
o any Plan Distributions made within the Plan Year that includes
the Determination Date or within the four preceding Plan Years.
(b) Aggregation Group
Aggregation Group means either a Required Aggregation Group or a
Permissive Aggregation Group as hereinafter determined.
(1) Required Aggregation Group
Each plan of the Employer in which a Key Employee is a
Participant, and each other plan of the Employer which enables
any plan in which a Key Employee participates to meet the
requirements of Code Section 401(a)(4) or 410, will be
aggregated and the resulting group will be known as a Required
Aggregation Group.
Each plan in the Required Aggregation Group will be considered a
Top-Heavy Plan if the Required Aggregation Group is a Top-Heavy
Group. No plan in the Required Aggregation Group will be
considered a Top-Heavy Plan if the Required Aggregation Group is
not a Top-Heavy Group.
(2) Permissive Aggregation Group
The Employer may also include any other plan not required to be
included in the Required Aggregation Group, provided the
resulting group (to be known as a Permissive Aggregation Group),
taken as a whole, would continue to satisfy the provisions of
Code Sections 401(a)(4) and 410.
Only a plan that is part of the Required Aggregation Group will
be considered a Top-Heavy Plan if the Permissive Aggregation
Group is a Top-Heavy Group. No plan in the Permissive
Aggregation Group will be considered a Top-Heavy Plan if the
Permissive Aggregation Group is not a Top-Heavy Group.
1-12
Only those plans of the Employer in which the Determination
Dates fall within the same calendar year will be aggregated in
order to determine whether the plans are Top-Heavy Plans.
(c) Determination Date
Determination Date means the last day of the preceding Plan Year,
or, in the case of the first Plan Year, the last day of the first
Plan Year.
(d) Key Employee
Key Employee means any Employee or former Employee (and his
Beneficiary) who, at any time during the Plan Year or any of the
preceding four Plan Years, was:
(1) A "Five Percent Owner" of the Employer. "Five Percent Owner"
means any person who owns (or is considered as owning within the
meaning of Code Section 318) more than 5% of the value of the
outstanding stock of the Employer or stock possessing more than
5% of the total combined voting power of all stock of the
Employer. If the Employer is not a corporation, Five Percent
Owner means any person who owns more than 5% of the capital or
profits interest in the Employer. In determining percentage
ownership hereunder, Related Employers will be treated as
separate Employers; or
(2) A "One Percent Owner" of the Employer having Compensation from
the Employer of more than $200,000. "One Percent Owner" means
any person who owns (or is considered as owning within the
meaning of Code Section 318) more than 1% of the value of the
outstanding stock of the Employer or stock possessing more than
1% of the total combined voting power of all stock of the
Employer. If the Employer is not a corporation, One Percent
Owner means any person who owns more than 1% of the capital or
profits interest in the Employer. In determining percentage
ownership hereunder, Related Employers will be treated as
separate Employers. However, in determining whether an
individual has Compensation of more than $150,000, Compensation
from each Related Employer will be taken into account.
(3) One of the 10 Employees having Compensation not less than the
Defined Contribution Dollar Limit (as defined in Section 7.03(j)
for the Plan Year) who owns (or is considered as owning within
the meaning of Code Section 318) both greater than 1/2% interest
and the largest interests in all Employers required to be
aggregated under Code Sections 414(b), (c), (m) and (o);
(4) An officer (within the meaning of the regulations under Code
Section 416) of the Employer having Compensation greater than
50% of the Defined Benefit Dollar Limit as defined in Section
7.03(f) for the Plan Year;
For purposes of this Section, Compensation means Aggregate
Compensation as defined in Section 7.03(a) plus any amounts
1-13
contributed by the Employer pursuant to a salary reduction agreement
which are excludable from the gross income of the Employee under
Code Section 125, 402(a)(8), 402(h) or 403(b). Compensation in
excess of $150,000 (as adjusted by the Secretary of the Treasury
under Code Section 415(d)) will be disregarded.
(e) Non-Key Employee
Non-Key Employee means any Employee (and his Beneficiaries) who is
not a Key Employee.
(f) Plan Distributions
Plan distributions include distributions made before January 1,
1984, and distributions under a terminated plan which, if it had not
been terminated, would have been required to be included in an
aggregation group. However, distributions made after the Valuation
Date and before the Determination Date are not included to the
extent that they are already included in the Participant's Single
Sum Benefit as of the Valuation Date.
With respect to "unrelated" rollovers and plan-to-plan transfers
(those which are both initiated by an employee and made from a plan
maintained by one employer to a plan maintained by another
employer), if such a rollover or plan-to-plan transfer is made from
this Plan, it will be considered as a distribution for purposes of
this Section. If such a rollover or plan-to-plan transfer is made
to this Plan, it will not be considered as part of the Participant's
Single Sum Benefit. However, an unrelated rollover or plan-to-plan
transfer accepted before January 1, 1984, will be considered as part
of the Participant's Single Sum Benefit.
With respect to "related" rollovers and plan-to-plan transfers
(those which are either not initiated by an employee or are made
from one plan to another plan maintained by the same employer), if
such a rollover or plan-to-plan transfer is made from this Plan, it
will not be considered as a distribution for purposes of this
Section. If such a rollover or plan-to-plan transfer is made to
this Plan, it will be considered as part of the Participant's Single
Sum Benefit.
(g) Present Value of Accrued Benefit
In the case of the defined benefit plan, a Participant's Present
Value of Accrued Benefit, for Top-Heavy determination purposes, will
be determined using the following rules:
(1) The Present Value of Accrued Benefit will be determined as of
the most recent "Valuation Date" within a 12-month period ending
on the Determination Date.
(2) For the first Plan Year, the Present Value of Accrued Benefit
will be determined as if (A) the Participant terminated service
as of the Determination Date; or (B) the Participant terminated
service as of the Valuation Date, but taking into account the
estimated Present Value of Accrued Benefits as of the
Determination Date.
1-14
(3) For any other Plan Year, the Present Value of Accrued Benefit
will be determined as if the Participant terminated service as
of the Valuation Date.
(4) The Valuation Date must be the same date used for computing the
defined benefit plan minimum funding costs, regardless of
whether a calculation is performed that plan year.
(5) A Participant's Present Value of Accrued Benefit as of a
Determination Date will be the sum of:
o the present value of his Accrued Benefit determined using
the actuarial assumptions which are specified below; plus
o any Plan Distributions made within the Plan Year that
includes the Determination Date or within the four preceding
Plan Years; plus
o any employee contributions, whether voluntary or mandatory.
However, amounts attributable to qualified voluntary
employee contributions, as defined in Code Section 219(e)(2)
will not be considered to be a part of the Participant's
Present Value of Accrued Benefit.
For purposes of this Section, the present value of a
Participant's Accrued Benefit will be equal to the greater of
the present value determined using the actuarial assumptions
which are specified for Actuarial Equivalent purposes or the
present value determined using the "Applicable Interest Rate."
The Applicable Interest Rate is the rate or rates that would be
used by the Pension Benefit Guaranty Corporation for a trusteed
single-employer plan to value a Participant's or Beneficiary's
benefit on the date of distribution (the "PBGC Rate"). If the
present value using the PBGC Rate exceeds $25,000, the
Applicable Interest Rate is 120% of the PBGC Rate. However, the
use of 120% of the PBGC Rate will never result in a present
value less than $25,000.
(6) Solely for the purpose of determining if this Plan (or any other
plan included in a Required Aggregation Group of which this Plan
is a part) is Top- Heavy, the Accrued Benefit of any Employee
other than a Key Employee will be determined under
(A) the method, if any, that uniformly applies for accrual
purposes under all plans maintained by the Employer or any
Related Employer, or
(B) if there is no such method, as if the benefit accrued no
more rapidly than the slowest accrual rate permitted under
the fractional accrual rate of Code Section 411(b)(1)(C).
1-15
(h) Single Sum Benefit
The Single Sum Benefit for any Participant in a defined benefit
pension plan will be equal to his Present Value of Accrued Benefit.
The Single Sum Benefit for any Participant in a defined contribution
plan will be equal to his Aggregate Account.
(i) Top-Heavy Group
Top-Heavy Group means an Aggregation Group in which, as of the
Determination Date, the Single Sum Benefits of all Key Employees
under all plans included in the group exceeds 60% of a similar sum
determined for all Participants.
Super Top-Heavy Group means an Aggregation Group in which, as of the
Determination Date, the sum of (1) the Single Sum Benefits of all
Key Employees under all defined benefit plans included in the group,
plus (2) the Single Sum Benefit of all Key Employees under all
defined contribution plans included in the group exceeds 90% of a
similar sum determined for all Participants.
(j) Top-Heavy Plan
This Plan will be a Top-Heavy Plan for any Plan Year beginning after
December 31, 1983, in which, as of the Determination Date, the
Single Sum Benefits of all Key Employees exceed 60% of the Single
Sum Benefits of all Participants under this Plan.
This Plan will be a Super Top-Heavy Plan for any Plan Year beginning
after December 31, 1983, in which, as of the Determination Date, the
Single Sum Benefits of all Key Employees exceed 90% of the Single
Sum Benefits of all Participants under this Plan.
If any Participant is a Non-Key Employee for a given Plan Year, but
was a Key Employee for any prior Plan Year, the Participant's Single
Sum Benefit will not be taken into account for purposes of
determining whether this Plan is a Top-Heavy or Super Top-Heavy Plan
(or whether any Aggregation Group which includes this Plan is a
Top-Heavy or Super Top-Heavy Group).
If an individual has performed no services for the Employer at any
time during the 5-year period ending on the Determination Date, any
Single Sum Benefit of such individual will not be taken into account
for purposes of determining whether this Plan is a Top-Heavy or
Super Top-Heavy Plan (or whether any Aggregation Group which
includes this Plan is a Top-Heavy Group or Super Top-Heavy Group).
1.37 Trust Fund, Trust
These terms mean the total cash, securities, real property, insurance
contracts and any other property held by the Trustee.
1.38 Trustee
The Trustee is SBS Trust Company or any successor Trustee.
1.39 Vested Percentage
A Participant's Vested Percentage as of a given date will be that
percentage determined in accordance with the Vesting Schedule.
1-16
Notwithstanding the preceding, a Participant will be 100% vested upon
reaching the earlier of (a) his Normal Retirement Age or (b) the later
of the date upon which the Participant attains age 65 or reaches the 5th
anniversary of the date he commenced participation in the Plan.
1.40 Vesting Schedule
The Vested Percentage of any Participant who is not actively employed on
January 1, 1994 is determined under the prior vesting schedule. The
Vested Percentage of any other Participant will be determined in
accordance with the following table:
Years of Vesting Service Vested Percentage
------------------------ -----------------
Less than 1 Year 0%
1 Year 20%
2 Years 40%
3 Years 60%
4 Years 80%
5 Years or more 100%
Notwithstanding the foregoing, a Participant's Vested Percentage will be
100% if a "Change in Control" of Triton Energy Corporation occurs. For
purposes of this Section, Change in Control means the occurrence of any
of the following events:
(a) The consummation of (i) any consolidation or merger of the Employer
in which the Employer is not the continuing or surviving corporation
or pursuant to which shares of the Employer's common stock would be
converted into cash, securities or other property, other than a
merger of the Employer in which the holders of the Employer's common
stock immediately prior to the merger have the same proportionate
ownership of common stock of the surviving corporation immediately
after the merger, or (ii) any sale, lease, exchange or other
transfer (excluding transfer by way of ledge or hypothecation), in
one transaction or a series of related transactions, of all, or
substantially all, of the assets of the Employer;
(b) The shareholders of the Employer approve any plan or proposal for
the liquidation or dissolution of the Employer;
(c) Any "person" (as such term is defined in Section 3(a)(9) or Section
13(d)(3) under the Securities Exchange Act of 1934) or any "group"
(as such term is used in Rule 13d-5 promulgated under the Securities
Exchange Act of 1934), other than the Employer or any successor of
the Employer or any Subsidiary of the Employer or any employee
benefit plan of the Employer or any subsidiary (including such
plan's trustee), becomes, without the prior approval of the
Directors of the Employer, a beneficial owner for purposes of
Rule13d-3 promulgated under the Securities Exchange Act of 1934,
directly or indirectly, of securities of the Employer representing
25% or more of the Employer's then outstanding securities having the
right to vote in the election of Directors of the Employer; or
1-17
(d) During any period of two consecutive years, individuals who, at the
beginning of such period constituted the entire Board of Directors
of the Employer, cease for any reason (other than death) to
constitute a majority of the Directors of the Employer, unless the
election, or the nomination for election, by the Employer's
shareholders, of each new Director of the Employer was approved by a
vote of at least two-thirds of the Directors of the Employer then
still in office who were Directors of the Employer at the beginning
of the period.
1.41 Written Resolution
The terms Written Resolution and Written Consent are used
interchangeably and reflect decisions, authorizations, etc. by the
Employer. A Written Resolution will be evidenced by a resolution of the
Board of Directors of the Employer.
1.42 Year of Service
(a) Crediting Years of Service
Years of Service are determined under the Elapsed Time Method.
Under the Elapsed Time Method, Years of Service are based upon an
Employee's Elapsed Time of employment irrespective of the number of
hours actually worked during such period; a Year of Service
(including a fraction thereof) will be credited for each completed
365 days of Elapsed Time which need not be consecutive. The
following terms are used in determining Years of Service under the
Elapsed Time Method:
(1) Date of Severance (Termination) - means the earlier of (A) the
actual date an Employee resigns, is discharged, dies or retires,
or (B) the first anniversary of the date an Employee is absent
from work (with or without pay) for any other reason, e.g.,
disability, vacation, leave of absence, layoff, etc.
Notwithstanding the above, Date of Severance will mean the date
specifically designated as such in any severance of employment
agreement.
(2) Elapsed Time - means the total period of service which has
elapsed between a Participant's Employment Commencement Date and
Date of Termination including Periods of Severance where a One
Year Break-in-Service does not occur.
(3) Employment Commencement Date - means the date an Employee first
performs one Hour of Service for the Employer.
(4) One Year Break-in-Service - means any 365-day period following
an Employee's Date of Termination as defined above in which the
Employee does not complete at least one Hour of Service.
(5) Period of Severance - is the time between the actual Date of
Severance as defined above and the subsequent date, if any, on
which the Employee performs an Hour of Service.
1-18
All periods of employment will be aggregated including Periods of
Severance unless there is a One Year Break-in-Service.
Years of Service for purposes of determining eligibility to
participate in the Plan and Years of Vesting Service for purposes of
determining a Participant's Vested Percentage include service with
any organization which is a Related Employer with respect to the
Employer.
(b) For Vesting Purposes
Years of Service for purposes of computing a Participant's Vested
Percentage are referred to as Years of Vesting Service and are
determined using the Elapsed Time Method.
All of a Participant's Years of Vesting Service are taken into
account in determining his Vested Percentage.
1-19
ARTICLE 2
PARTICIPATION
2.01 Participation
An Employee who is a member of an Eligible Employee Classification will
become eligible to participate in the Plan on the Entry Date which
coincides with or next follows his or her Employment Commencement Date.
An Employee who is eligible to participate as of the Effective Date or
as of a given Entry Date will automatically become a Participant as of
such date. An Employee who is otherwise eligible to participate may
irrevocably elect not to participate in the Plan. Any election under
this paragraph must be in writing and according to guidelines
established by the Plan Administrator.
2.02 Participation After Reemployment
An Employee who terminates employment prior to his Entry Date will
participate in the Plan immediately upon returning to the employ of the
Employer.
A Participant or Former Participant who has terminated employment will
participate as an Active Participant in the Plan immediately upon
returning to the employ of the Employer.
2.03 Change in Employment Classification
In the event a Participant becomes ineligible to participate because he
is no longer a member of an Eligible Employee Classification, the
Participant will participate immediately upon his return to an Eligible
Employee Classification.
In the event an Employee who is not a member of an Eligible Employee
Classification becomes a member of such a classification, such Employee
will begin to participate immediately if he has satisfied the
eligibility requirements which are specified in Section 2.01.
2-1
ARTICLE 3
PARTICIPANT ACCOUNTS
3.01 Employee Account
Employee Account means the Account of a Participant reflecting
applicable contributions, investment income or loss allocated thereto
and distributions. A Participant's Employee Account is 100% vested at
all times.
(a) Employee Contributions
(1) Amount of Contribution
Each Participant will be entitled to make an Employee
Contribution each Accounting Period equal to a minimum of 1% of
the Participant's Compensation not to exceed 12% of the
Participant's Compensation. Such contribution will be
designated as a percentage of Compensation and will be equal to
an even multiple of 1% or such other amount as allowed by the
Plan Administrator.
(2) Payroll Withholding
All Employee Contributions will be made pursuant to a Payroll
Withholding Agreement in accordance with Section 1.27.
(3) Nondiscrimination Requirements
All Employee Contributions are Elective Contributions within the
meaning of Section 4.05(a) and must satisfy the
Nondiscrimination Requirements of Section 4.05.
(4) Excess Deferrals
The maximum amount of Employee Contribution which can be made
under the Plan on behalf of any Participant during any calendar
year will be limited to that amount which would not constitute
an Excess Deferral as defined in Section 4.05. The Plan
Administrator will distribute any Excess Deferral, together with
the income allocable to it, to the Participant no later than
April 15 of the calendar year immediately following the year of
the Excess Deferral. If a Participant notifies the Plan
Administrator before March 1 of any calendar year that Excess
Deferrals have been made on his account for the previous
calendar year by reason of participation in a Cash or Deferred
Arrangement maintained by another employer or employers, and if
the Participant requests that the Plan Administrator distribute
a specific amount to him on account of Excess Deferrals and
certifies that the requested amount is an Excess Deferral, the
Plan Administrator will designate the amount requested together
with the income allocable to it as a distribution of Excess
deferrals and distribute such amount no later than April 15 of
that calendar year. The amount of Excess Deferrals to be
distributed will be reduced by any Excess Contributions
previously distributed or recharacterized with respect to the
3-1
Plan Year beginning with or within the calendar year. The
amount of income allocable to the Excess Deferral will be
determined as described in Section 4.05.
(5) Timing of Deposits
The Employer will deposit all Employee Contributions no later
than 90 days after the date on which the amounts withheld would
otherwise have been paid to the Participant in cash.
(b) Distributions
No distribution may be made from the Participant's Employee Account
or any account comprised of Matching Contributions or Nonelective
Contributions which are treated as Elective Contributions in
accordance with the provisions of Section 4.05(h) except under one
of the following circumstances:
o the Participant's retirement, death, disability or termination
of employment;
o the Participant's attaining of age 59 1/2;
o the avoidance or alleviation of a Financial Hardship;
o the termination of this Plan without the establishment of a
successor plan within the meaning of Treasury Regulation Section
1.401(k)-1(d)(3);
o the sale or other disposition by the Employer of at least 85
percent of the assets used by the Employer in a trade or
business to an unrelated corporation which does not maintain the
plan, but only if the Participant continues employment with the
corporation acquiring the assets and only if the Employer
continues to maintain this Plan; or
o the sale or other disposition by the Employer of its interest in
a subsidiary to an unrelated entity which does not maintain the
plan, but only if the Participant continues employment with the
subsidiary and only if the Employer continues to maintain this
Plan.
This paragraph does not apply to distributions of Excess Deferrals,
Excess Contributions, or excess Annual Additions.
(c) Financial Hardship Withdrawals
A Participant may file with the Plan Administrator a written request
to withdraw, in order to avoid or alleviate a Financial Hardship,
any amount not to exceed that portion of his Employee Account which
represents his total Employee Contributions.
The Plan Administrator will allow Financial Hardship withdrawals
only if they are necessary to satisfy a Participant's immediate and
heavy financial need.
3-2
(1) Immediate and Heavy Financial Need
A withdrawal will be deemed to be made due to an immediate and
heavy financial need of the Participant if it is made because
of:
o Expenses for medical care described in Code Section 213(d)
previously incurred by the Participant, his spouse or any of
his dependents (as defined in Code Section 152) or necessary
for these persons to obtain medical care described in Code
Section 213(d);
o Costs directly related to the purchase (excluding mortgage
payments) of a principal residence for the Participant;
o Payment of tuition or educational fees for the next 12
months of post-secondary education for the Participant, his
spouse, children or dependents (as defined in Code Section
152);
o Prevention of the eviction of the Participant from his
principal residence or foreclosure on the mortgage of the
Participant's principal residence.
(2) Necessary To Satisfy Financial Need
No withdrawal may exceed the amount necessary to satisfy the
Participant's immediate and heavy financial need. However, the
amount of an immediate and heavy financial need may include any
amounts necessary to pay any federal, state or local income
taxes or penalties reasonably anticipated to result from the
distribution. The Plan Administrator will allow the withdrawal
if it determines, after a full review of the Participant's
written request and evidence presented by the Participant
showing immediate and heavy financial need as well as the
Participant's lack of other reasonably available resources, that
the withdrawal is necessary to satisfy the need. No withdrawal
will be treated as necessary to the extent it can be satisfied
from other resources which are reasonably available to the
Participant, including those of the Participant's spouse and
minor children. A withdrawal will be treated as necessary to
the extent the Participant demonstrates to the satisfaction of
the Plan Administrator that the need cannot be relieved by any
of the following:
o Reimbursement or compensation by insurance or otherwise;
o Reasonable liquidation of assets to the extent the
liquidation would not itself cause an immediate and heavy
financial need;
o Cessation of Employee Contributions or Employee
Contributions (as defined in Section 4.05(a)) or both under
any plan maintained by any employer;
o Other distributions or nontaxable (at the time of the loan)
3-3
loans from plans maintained by any employer;
o Borrowing from commercial sources on reasonable commercial
terms.
Unless the Plan Administrator has evidence to the contrary, it
may rely upon the Participant's written representation that the
need cannot be relieved by any of the foregoing.
(3) Safe Harbor
The Plan Administrator will not allow any withdrawal until the
Participant has obtained all distributions, other than hardship
distributions, and all nontaxable loans currently available to
the Participant under all plans maintained by the Employer.
Upon the withdrawal of any portion of a Participant's Employee
Account, the Participant will become ineligible for any Elective
Contribution to this Plan or any other plan maintained by the
Employer, or to make any contribution to this Plan or any other
plan maintained by the Employer until the first day of the first
Accounting Period which begins not less than 12 months following
the date of withdrawal. For this purpose the phrase "any other
plan maintained by the Employer" means all qualified and
nonqualified plans of deferred compensation maintained by the
Employer. The phrase includes stock option, stock purchase, or
similar plans, or a cash or deferred arrangement that is part of
a cafeteria plan within the meaning of Code Section 125. It
does not include the mandatory employee contribution portion of
a defined benefit plan, nor does it include a health or welfare
benefit plan (including one that is part of a cafeteria plan
within the meaning of Code Section 125). Furthermore, the
maximum amount of Employee Contributions which can be made under
the Plan on behalf of any Participant during the calendar year
which follows the calendar year in which the withdrawal was made
will be limited to the amount which would not be treated as an
Excess Deferral for that year reduced by the amount of Employee
Contributions made on behalf of the Participant in the calendar
year of withdrawal.
3.02 Triton Matching Account
Triton Matching Account means the Account of a Participant reflecting
applicable contributions, forfeitures, investment income or loss
allocated thereto and distributions. A Participant's Triton Matching
Account is subject to the Vesting Schedule.
(a) Triton Matching Contributions
Each Accounting Period, the Employer will, within the time
prescribed by law for making a deductible contribution, make a
Triton Matching Contribution to each Eligible Participant's Triton
Matching Account in an amount which is determined in accordance with
this Section subject to the limitations of Article 7.
The amount of Triton Matching Contribution to be made to an Eligible
Participant's Triton Matching Account is equal to 100% of that
3-4
portion of the Participant's Employee Contribution which is not in
excess of 6% of the Participant's Compensation.
Each calendar year, the Employer may, within the time prescribed by
law for making a deductible contribution, make an additional Triton
Matching Contribution to the Trust. For a given calendar year, the
total additional Triton Matching Contribution, if any, made by the
Employer will be an amount determined and authorized by the Employer
for such calendar year. The additional Triton Matching Contribution
for a calendar year will be allocated to all Participants who are
actively employed as of the last day of such calendar year in
proportion to the total amount of Triton Matching Contribution
otherwise made to the Participant's Triton Matching Account during
the calendar year.
All Triton Matching Contributions are Matching Contributions within
the meaning of Section 4.05(a) and must satisfy the
Nondiscrimination Requirements of Section 4.05.
(b) Application of Forfeitures
Forfeitures from a Participant's Triton Matching Account will be
used to reduce Triton Matching Contributions in the Plan Year in
which the Forfeitures are determined to occur.
(c) Withdrawals
A Participant may not withdraw any portion of his Triton Matching
Account prior to the time when benefits otherwise become payable in
accordance with the provisions of Article 5.
3.03 Prior Plan Account
Prior Plan Account means the Account of a Participant reflecting
applicable contributions, forfeitures, investment income or loss
allocated thereto and distributions. A Participant's Prior Plan Account
is subject to the Vesting Schedule.
(a) ESOP Contributions
Effective June 1, 1993, ESOP contributions to the Prior Plan Account
ceased. The last contribution to any Participant's Prior Plan
Account was for the Plan Year ending May 31, 1993.
(b) Application of Forfeitures
Forfeitures from a Participant's Prior Plan Account will be used to
reduce Triton Matching Contributions in the Plan Year in which the
Forfeitures are determined to occur.
(c) Withdrawals
A Participant may not withdraw any portion of his Prior Plan Account
prior to the time when benefits otherwise become payable in
accordance with the provisions of Article 5.
3-5
3.04 Rollover Account
Rollover Account means the Account of a Participant reflecting
applicable contributions, investment income or loss allocated thereto
and distributions. A Participant's Rollover Account is 100% vested at
all times.
(a) Rollover Contributions
Rollover Contribution means a contribution to the Plan by a
Participant where such contribution is the result of a prior
distribution from an Individual Retirement Account, an Individual
Retirement Annuity or another qualified plan. Such prior
contribution must be a rollover amount described in Section
402(c)(4) of the Code or a contribution described in Section
408(d)(3) of the Code.
Each Employee who is a member of an Eligible Employee
Classification, regardless of whether he is a Participant in the
Plan, will have the right to make a Rollover Contribution of cash
into the Plan from another qualified plan. If the Employee is not a
Participant hereunder, his Rollover Account will constitute his
entire interest in the Plan. In no event will the existence of a
Rollover Account entitle the Employee to participate in any other
benefit provided by the Plan.
If specifically provided for in a Written Resolution, Rollover
Contribution will also mean the amount of assets transferred,
pursuant to Section 10.05, to this Plan from another plan which is
qualified under Code Sections 401(a) and 501(a).
(b) Withdrawals
A Participant may withdraw all or any portion of his Rollover
Account at any time. However, if a Participant makes such a
withdrawal, he may not make another withdrawal from his Rollover
Account until three months have elapsed.
3-6
ARTICLE 4
ACCOUNTING AND VALUATION
4.01 General Powers of the Plan Administrator
The Plan Administrator will have the power to establish rules and
guidelines, which will be applied on a uniform and non-discriminatory
basis, as it deems necessary, desirable or appropriate with regard to
accounting procedures and to the timing and method of contributions to
and/or withdrawals from the Plan.
4.02 Accounting Procedure
As of each Valuation Date, the Plan Administrator will determine from
the Trustee the fair market value of Trust assets and will, subject to
the provisions of this Article, determine the allocation of such value
among the Accounts of the Participants; in doing so, the Plan
Administrator will in the following order:
(a) Credit or charge, as appropriate, to the proper Accounts all
transfers, payments, forfeitures, withdrawals or other distributions
made to or from such Accounts during the current Accounting Period
that have not been previously credited or charged.
(b) Credit or charge, as applicable, each Account that is in existence
on the Valuation Date with its pro rata portion of the appreciation
or depreciation in the fair market value of the Trust Fund since the
prior Valuation Date. Such appreciation or depreciation will
reflect investment income, realized and unrealized gains and losses,
other investment transactions and expenses paid from the Trust
Fund. Such pro rata crediting or charging will be based upon the
current amounts of the Accounts as adjusted by the above step (a).
The Plan Administrator will establish the guidelines under which any
appreciation or depreciation is allocated to the various Accounts as
of the first Valuation Date for the Plan.
(c) Credit to the proper Accounts all contributions and reallocated
forfeitures which are to be credited for the current Accounting
Period.
4.03 Assumed Timing of Credits and Charges
Notwithstanding the provisions of Section 4.02, for purposes of
determining each Account's pro rata portion of the appreciation or
depreciation in the fair market value of the Trust Fund under Section
4.02(b), the following timing will be reflected:
o Employee Account - Contributions to such Account are
assumed to occur in the middle of an Accounting Period.
o Triton Matching Account - Contributions to such Account are
assumed to occur in the middle of an Accounting Period.
4-1
4.04 Participant Direction of Investment
(a) Application of this Section
Subject to the provisions of this Section, each Participant will
have the right to direct the investment of all of his Accounts among
the Specific Investment Funds which are made available by the Plan
Administrator.
(b) General Powers of the Plan Administrator
The Plan Administrator will have the power to establish rules and
guidelines as it deems necessary, desirable or appropriate with
regard to the directed investment of contributions in accordance
with this Section. Included in such powers, but not by way of
limitation, are the following powers and rights.
(1) To direct the Trustee to temporarily invest those contributions
which are pending directed investment in a Specific Investment
Fund, in the General Investment Fund or in some other manner as
determined by the Plan Administrator.
(2) To establish rules with regard to the transfer of all or any
part of the balance of an Account or Accounts of a given
Participant from one Investment Fund to another.
(3) To direct the Trustee to maintain any part of the assets of any
Investment Fund in cash, or in demand or short-term time
deposits bearing a reasonable rate of interest, or in a
short-term investment fund that provides for the collective
investment of cash balances or in other cash equivalents having
ready marketability, including, but not limited to, U.S.
Treasury Bills, commercial paper, certificates of deposit, and
similar types of short-term securities.
(c) Accounting
The Plan Administrator will maintain a set of accounts for each
Investment Fund. The accounts of the Plan Administrator for each
Investment Fund will indicate separately the dollar amounts of all
contributions made to such Investment Fund by or on behalf of each
Participant from time to time. The Plan Administrator will compute
the net income from investments; net profits or losses arising from
the sale, exchange, redemption, or other disposition of assets, and
the prorata share attributable to each Investment Fund of the
expenses of the administration of the Plan and Trust and will debit
or credit, as the case may be, such income, profits or losses, and
expenses to the unsegregated balance in each Investment Fund from
time to time. To the extent that the expenses of the administration
of the Plan and Trust are not directly attributable to a given
Investment Fund, such expenses, as of a given Valuation Date, will
be prorated among each Investment Fund; such allocation of expenses
will, in general, be performed in accordance with the guidelines
which are specified in this Article.
4-2
(d) Future Contributions
Each Participant who elects to participate in the Plan will
designate, in writing, the particular percentage of those
contributions (which are subject to Participant direction of
investment) which is to be deposited in the various available
Investment Funds. Written designations will be made not later than
15 days before the first day of each Accounting Period (or at some
other time as specified by the Plan Administrator) and will be
effective for such Accounting Period and each Accounting Period
thereafter until modified. Designations will be limited to
multiples of 10% (or such other reasonable increments as determined
by the Plan Administrator). If any Participant fails to make a
designation by the appropriate date, he will be deemed to have
designated an Investment Fund(s) as determined by the Plan
Administrator.
(e) Change in Investment of Past Contributions
A Participant may file a written election with the Plan
Administrator to shift the aggregate amount or reasonable increments
(as determined by the Plan Administrator) of the balance of his
existing Account or Accounts which are subject to Participant
direction of investment among the various available Investment Funds
as of the first day of each Accounting Period (or such other time or
times as determined by the Plan Administrator). The form of such
written election will be specified by the Plan Administrator and
will be filed not later than 15 days before the effective date of
the shift (or at such other time as determined by the Plan
Administrator).
(f) Addition and Deletion of Specific Investment Funds
Specific Investment Funds may be deleted or added from time to time
at the direction of the Plan Administrator. The Plan Administrator
will establish guidelines for the proper administration of affected
Accounts when a Specific Investment Fund is added or deleted.
4.05 Nondiscrimination Requirements
(a) Definitions Applicable to the Nondiscrimination Requirements
The following definitions apply to this Section:
(1) Aggregate Limit
With respect to a given Plan Year, Aggregate Limit means the
greater of the sum of [(A) + (B)] or the sum of [(C) + (D)]
where:
(A) is equal to 125% of the greater of DP or CP;
(B) is equal to 2 percentage points plus the lesser of DP or
CP, not to exceed 2 times the lesser of DP or CP;
(C) is equal to 125% of the lesser of DP or CP;
(D) is equal to 2 percentage points plus the greater of DP or
CP, not to exceed 2 times the greater of DP or CP;
4-3
DP represents the Deferral Percentage for the Non-highly
Compensated Group eligible under the Cash or Deferred
Arrangement for the Plan Year; and
CP represents the Contribution Percentage for the Non-highly
Compensated Group eligible under the plan providing for
the Employee Contributions or Employer Matching
Contributions for the Plan Year beginning with or within
the Plan Year of the Cash or Deferred Arrangement.
(2) Cash or Deferred Arrangement (CODA)
A Cash or Deferred Election is any election (or modification of
an earlier election) by an Employee to have the Employer either:
o provide an amount to the Employee in the form of cash or
some other taxable benefit that is not currently
available, or
o contribute an amount to the Plan (or provide an accrual
or other benefit) thereby deferring receipt of
Compensation.
A Cash or Deferred Election will only be made with respect to an
amount that is not currently available to the Employee on the
date of election. Further, a Cash or Deferred Election will
only be made with respect to amounts that would have (but for
the Cash or Deferred Election) become currently available after
the later of the date on which the Employer adopts the Cash or
Deferred Arrangement or the date on which the arrangement first
becomes effective.
A Cash or Deferred Election does not include a one-time
irrevocable election upon the Employee's commencement of
employment or first becoming an Eligible Employee.
(3) Compensation
For purposes of this Section, Compensation means Aggregate
Compensation as defined in Section 7.03(a) plus amounts
contributed by the Employer pursuant to a salary reduction
agreement which are excludable from the gross income of the
Employee under Code Section 125, 402(a)(8), 402(h) or 403(b).
Compensation in excess of $200,000 (as adjusted by the Secretary
of the Treasury under Code Section 415(d)) is disregarded.
The period used to determine an Employee's Compensation for a
Plan Year may be limited to that portion of the Plan Year in
which the Employee was an Eligible Employee, provided that this
method is applied uniformly to all Eligible Employees under the
Plan for the Plan Year.
(4) Contribution Percentage
Contribution Percentage means, for any specified group, the
average of the ratios calculated (to the nearest one-hundredth
4-4
of one percent) separately for each Participant in the group, of
the amount of Employee Contributions and Matching Contributions
which are made by or on behalf of each Participant for a Plan
Year to each Participant's Compensation for the Plan Year.
For purposes of determining the Contribution Percentage, each
Employee who is eligible under the terms of the Plan to make or
to have contributions made on his behalf is treated as a
Participant. The Contribution Percentage of an eligible
Employee who makes no Employee Contribution and receives no
Matching Contribution is zero.
For purposes of determining the Contribution Percentage of a
Participant who is a Highly Compensated Employee, the
Compensation of and all Employee Contributions and Matching
Contributions for the Participant include, in accordance with
the provisions of Section 4.05(d), the Compensation of and all
Employee Contributions and Matching Contributions for any Family
Member of the Participant.
The Contribution Percentage of a Participant who is a Highly
Compensated Employee for the Plan Year and who is eligible to
make Employee Contributions or receive an allocation of Matching
Contributions (including Elective Contributions and Nonelective
Contributions which are treated as Employee or Matching
Contributions for purposes of the Contribution Percentage Test)
allocated to his accounts under two or more plans which are
sponsored by the Employer will be determined as if the Employee
and Matching Contributions were made under a single plan. For
purposes of this paragraph, if a Highly Compensated Employee
participates in two or more such plans which have different Plan
Years, all plans ending with or within the same calendar year
will be treated as a single plan.
(5) Contribution Percentage Test
The Contribution Percentage Test is a test applied on a Plan
Year basis to determine whether a plan meets the requirements of
Code Section 401(m). The Contribution Percentage Test may be
met by either satisfying the General Contribution Percentage
Test or the Alternative Contribution Percentage Test.
The General Contribution Percentage Test is satisfied if the
Contribution Percentage for the Highly Compensated Group does
not exceed 125% of the Contribution Percentage for the
Non-highly Compensated Group.
The Alternative Contribution Percentage Test is satisfied if the
Contribution Percentage for the Highly Compensated Group does
not exceed the lesser of:
o the Contribution Percentage for the Non-highly
Compensated Group plus 2 percentage points, or
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o the Contribution Percentage for the Non-highly
Compensated Group multiplied by 2.0.
If (i) one or more Highly Compensated Employees of the Employer
or any Related Employer are eligible to participate in both a
Cash or Deferred Arrangement and a plan which provides for
Employee Contributions or Matching Contributions, (ii) the
Deferral Percentage for the Highly Compensated Group does not
satisfy the General Deferral Percentage Test, and (iii) the
Contribution Percentage for the Highly Compensated Group does
not satisfy the General Contribution Percentage Test, then the
Contribution Percentage Test will be deemed to be satisfied only
if the sum of the Deferral Percentage and the Contribution
Percentage for the Highly Compensated Group does not exceed the
Aggregate Limit.
The Plan will not fail to satisfy the Contribution Percentage
test merely because all of the Eligible Employees under the Plan
for a Plan Year are Highly Compensated Employees.
(6) Deferral Percentage
Deferral Percentage means, for any specified group, the average
of the ratios calculated (to the nearest one-hundredth of one
percent) separately for each Participant in the group, of the
amount of Elective Contributions which are made on behalf of
each Participant for a Plan Year to each Participant's
Compensation for the Plan Year.
For purposes of determining the Deferral Percentage, each
Employee who is eligible under the terms of the Plan to have
contributions made on his behalf is treated as a Participant.
The Deferral Percentage of an eligible Employee who makes no
Elective Contribution is zero.
For purposes of determining the Deferral Percentage of a
Participant who is a Highly Compensated Employee, the
Compensation of and Elective Contributions for the Participant
include, in accordance with the provisions of Section 4.05(d),
the Compensation and all Elective Contributions for any Family
Member of the Participant.
The Deferral Percentage of a Participant who is a Highly
Compensated Employee for the Plan Year and who is eligible to
have Elective Contributions (including Nonelective Contributions
or Matching Contributions which are treated as Elective
Contributions for purposes of the Deferral Percentage Test)
allocated to his accounts under two or more Cash or Deferred
Arrangements which are maintained by the Employer will be
determined as if the Elective Contributions were made under a
single Arrangement. For purposes of this paragraph, if a Highly
Compensated Employee participates in two or more Cash or
Deferred Arrangements which have different Plan Years, all Cash
or Deferred Arrangements ending with or within the same calendar
year will be treated as a single Arrangement.
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(7) Deferral Percentage Test
The Deferral Percentage Test is a test applied on a Plan Year
basis to determine whether a plan meets the requirements of Code
Section 401(k). The Deferral Percentage Test may be met by
either satisfying the General Deferral Percentage Test or the
Alternative Deferral Percentage Test.
The General Deferral Percentage Test is satisfied if the
Deferral Percentage for the Highly Compensated Group does not
exceed 125% of the Deferral Percentage for the Non-highly
Compensated Group.
The Alternative Deferral Percentage Test is satisfied if the
Deferral Percentage for the Highly Compensated Group does not
exceed the lesser of:
o the Deferral Percentage for the Non-highly Compensated
Group plus 2 percentage points, or
o the Deferral Percentage for the Non-highly Compensated
Group multiplied by 2.0.
If (i) one or more Highly Compensated Employees of the Employer
or any Related Employer are eligible to participate in both a
Cash or Deferred Arrangement and a plan which provides for
Employee Contributions or Matching Contributions, (ii) the
Deferral Percentage for the Highly Compensated Group does not
satisfy the General Deferral Percentage Test, and (iii) the
Contribution Percentage for the Highly Compensated Group does
not satisfy the General Contribution Percentage Test, then the
Deferral Percentage Test will be deemed to be satisfied only if
the sum of the Deferral Percentage and the Contribution
Percentage for the Highly Compensated Group does not exceed the
Aggregate Limit.
The Plan will not fail to satisfy the Deferral Percentage test
merely because all of the Eligible Employees under the Plan for
a Plan Year are Highly Compensated Employees.
(8) Elective Contribution
Elective Contribution means any contribution made by the
Employer to a Cash or Deferred Arrangement on behalf of and at
the election of an Employee. An Elective Contribution will be
taken into account for a given Plan Year only if:
o The Elective Contribution is allocated to the
Participant's Account as of a date within the Plan Year
to which it relates;
o The allocation is not contingent upon the Employee's
participation in the Plan or performance of services on
any date after the allocation date;
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o The Elective Contribution is actually paid to the trust
no later than 12 months after the end of the Plan Year
to which the Elective Contribution relates; and
o The Elective Contribution relates to Compensation which
either (i) but for the Participant's election to defer,
would have been received by the Participant in the Plan
Year or (ii) is attributable to services performed by
the Participant in the Plan Year and, but for the
Participant's election to defer, would have been
received by the Participant within two and one-half
months after the close of the Plan Year.
Elective Contributions will be treated as Employer Contributions
for purposes of Code Sections 401(a), 401(k), 402(a), 404, 409,
411, 412, 415, 416, and 417.
(9) Elective Deferral
Elective Deferral means the sum of the following:
o Any Elective Contribution to any Cash or Deferred
Arrangement to the extent it is not includable in the
Participant's gross income for the taxable year of
contribution;
o Any employer contribution to a simplified employee
pension as defined in Code Section 408(k) to the extent
not includable in the Participant's gross income for the
taxable year of contribution;
o Any employer contribution to an annuity contract under
Code Section 403(b) under a salary reduction agreement
to the extent not includable in the Participant's gross
income for the taxable year of contribution; plus
o Any employee contribution designated as deductible under
a trust described in Code Section 501(c)(18) for the
taxable year of contribution.
(10) Eligible Employee
Eligible Employee means an Employee who is directly or
indirectly eligible to make a Cash or Deferred Election under
the Plan for all or a portion of the Plan Year. An Employee who
is unable to make a Cash or Deferred Election because the
Employee has not contributed to another plan is also an Eligible
Employee. An Employee who would be eligible to make Elective
Contributions but for a suspension due to a distribution, a
loan, or an election not to participate in the Plan, is treated
as an Eligible Employee for purposes of Code Section 401(k)(3)
and 401(m) for a Plan Year even though the Employee may not make
a Cash or Deferred Election due to the suspension. Also, an
Employee will not fail to be treated as an Eligible Employee
merely because the employee may receive no additional Annual
Additions because of Code Section 415(c)(1) or 415(e).
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(11) Employee Contribution
Employee Contribution means any contribution made by an Employee
to any plan maintained by the Employer or any Related Employer
which is other than an Elective Contribution and which is
designated or treated at the time of contribution as an
after-tax contribution. Employee Contributions include amounts
attributable to Excess Contributions which are recharacterized
as Employee Contributions.
(12) Excess Contribution
Excess Contribution means, for each member of the Highly
Compensated Group, the amount of Elective Contribution
(including any Qualified Nonelective Contributions and Qualified
Matching Contributions which are treated as Elective
Contributions) which exceeds the maximum contribution which
could be made if the Deferral Percentage Test were to be
satisfied.
(13) Excess Aggregate Contribution
Excess Aggregate Contribution means, for each member of the
Highly Compensated Group, the amount of Employee and Matching
Contributions (including any Qualified Nonelective Contributions
and Elective Contributions which are treated as Matching
Contributions) which exceeds the maximum contribution which
could be made if the Contribution Percentage Test were to be
satisfied.
(14) Excess Deferral
Excess Deferral means, for a given calendar year, that amount by
which each Participant's total Elective Deferrals under all
plans of all employers exceed the dollar limit in effect under
Code Section 402(g) for the calendar year.
(15) Matching Contribution
Matching Contribution means any contribution made by the
Employer to any plan maintained by the Employer or any Related
Employer which is based on an Elective Contribution or an
Employee Contribution together with any forfeiture allocated to
the Participant's Account on the basis of Elective
Contributions, Employee Contributions or Matching
Contributions. A Matching Contribution will be taken into
account for a given Plan Year only if:
o The Matching Contribution is allocated to a
Participant's Account as of a date within the Plan Year
to which it relates;
o The allocation is not contingent upon the Employee's
participation in the Plan or performance of services on
any date after the allocation date;
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o The Matching Contribution is actually paid to the Trust
no later than 12 months after the end of the Plan Year
to which the Matching Contribution relates; and
o The Matching Contribution is based on an Elective or
Employee Contribution for the Plan Year.
Any contribution or allocation, other than a Qualified
Nonelective Contribution, which is used to meet the minimum
contribution or benefit requirement of Code Section 416 is not
treated as being based on Elective Contributions or Employee
Contributions and therefore is not treated as a Matching
Contribution.
Qualified Matching Contribution means a Matching Contribution
which is 100% vested and may be withdrawn or distributed only
under the conditions described in Treasury Regulation
1.401(k)-1(d).
(16) Nonelective Contribution
Nonelective Contribution means any Employer Contribution, other
than a Matching Contribution, which meets all of the following
requirements:
o The Nonelective Contribution is allocated to a
Participant's Account as of a date within the Plan Year
to which it relates;
o The allocation is not contingent upon the Employee's
participation in the Plan or performance of services on
any date after the allocation date;
o The Nonelective Contribution is actually paid to the
Trust no later than 12 months after the end of the Plan
Year to which the Nonelective Contribution relates; and
o The Employee may not elect to have the Nonelective
Contribution paid in cash in lieu of being contributed
to the Plan.
Qualified Nonelective Contribution means a Nonelective
Contribution which is 100% vested and may be withdrawn or
distributed only under the conditions described in Treasury
Regulation 1.401(k)-1(d).
(b) Application of Deferral Percentage Test
All Elective Contributions, including any Elective Contributions
which are treated as Employee or Matching Contributions with respect
to the Contribution Percentage Test, must satisfy the Deferral
Percentage Test. Furthermore, any Elective Contributions which are
not treated as Employee or Matching Contributions with respect to
the Contribution Percentage Test must satisfy the Deferral
Percentage Test. The Plan Administrator will determine as soon as
administratively feasible after the end of the Plan Year whether the
4-10
Deferral Percentage Test has been satisfied. If the Deferral
Percentage Test is not satisfied, the Employer may elect to make an
additional contribution to the Plan on account of the Non-highly
Compensated Group. The additional contribution will be treated as a
Nonelective Contribution.
If the Deferral Percentage Test is not satisfied after any
Nonelective Contributions, the Plan Administrator may, in its sole
discretion, recharacterize all or any portion of the Excess
Contribution of each Highly Compensated Employee as an Employee
Contribution if Employee Contributions are otherwise allowed by the
Plan. If so, the Plan Administrator will notify all affected
Participants and the Internal Revenue Service of the amount
recharacterized no later than the 15th day of the third month
following the end of the Plan Year in which the Excess Contribution
was made. Excess Contributions will be includable in the
Participant's gross income on the earliest date any Elective
Contribution made on behalf of the Participant during the Plan Year
would have been received by the Participant had the Participant
elected to receive the amount in cash. Recharacterized Excess
Contributions will continue to be treated as Employer Contributions
that are Elective Contributions for all other purposes under the
Code, including Code Sections 401(a) (other than 401(a)(4) and
401(m)), 404, 409, 411, 412, 415, 416, 417 and 401(k)(2). With
respect to the Plan Year for which the Excess Contribution was made,
the Plan Administrator will treat the recharacterized amount as an
Employee Contribution for purposes of the Deferral Percentage Test
and the Contribution Percentage Test and for purposes of determining
whether the Plan meets the requirements of Code Section 401(a)(4),
but not for any other purposes under this Plan. Therefore,
recharacterized amounts will remain subject to the nonforfeiture
requirements and distribution limitations which apply to Elective
Contributions.
If the Deferral Percentage Test is still not satisfied, then after
the close of the Plan Year in which the Excess Contribution arose
but within 12 months after the close of that Plan Year, the Plan
Administrator will distribute the Excess Contributions, together
with allocable income, to the affected Participants of the Highly
Compensated Group to the extent necessary to satisfy the Deferral
Percentage Test. Failure to do so will cause the Plan to not
satisfy the requirements of Code Section 401(a)(4) for the Plan Year
for which the Excess Contribution was made and for all subsequent
Plan Years for which the Excess Contribution remains uncorrected.
The amount of Excess Contribution to be distributed to a Highly
Compensated Employee for a Plan Year will be reduced by any Excess
Deferrals previously distributed to the Participant for the calendar
year ending with or within the Plan Year in accordance with Code
Section 402(g)(2).
Excess Contributions will be treated as Employer Contributions for
purposes of Code Sections 404 and 415 even if distributed from the
Plan.
4-11
(c) Application of Contribution Percentage Test
Employee Contributions and Matching Contributions, disregarding any
Matching Contributions which are treated as Elective Contributions
with respect to the Deferral Percentage Test, must satisfy the
Contribution Percentage Test. The Plan Administrator will determine
as soon as administratively feasible after the end of the Plan Year
whether the Contribution Test has been satisfied. If the
Contribution Percentage Test is not satisfied, the Employer may
elect to make an additional contribution to the Plan for the benefit
of the Non-Highly Compensated Group. The additional contribution
will be treated as a Nonelective Contribution.
If the Contribution Percentage Test is still not satisfied, then
after the close of the Plan Year in which the Excess Aggregate
Contribution arose but within 12 months after the close of that Plan
Year, the Plan Administrator will distribute (or forfeit, to the
extent not vested) the Excess Aggregate Contributions, together with
allocable income, to the affected Participants of the Highly
Compensated Group to the extent necessary to satisfy the
Contribution Percentage Test. Failure to do so will cause the Plan
to not satisfy the requirements of Code Section 401(a)(4) for the
Plan Year for which the Excess Aggregate Contribution was made and
for all subsequent Plan Years for which the Excess Aggregate
Contribution remains uncorrected.
The determination of any Excess Aggregate Contributions will be made
after the recharacterization of any Excess Contributions as Employee
Contributions.
Excess Aggregate Contributions, including forfeited Matching
Contributions, will be treated as Employer Contributions for
purposes of Code Sections 404 and 415 even if they are distributed
from the Plan.
Forfeited Matching Contributions that are reallocated to the
Accounts of other Participants are treated as Annual Additions under
Code Section 415 for the Participant whose Accounts they are
reallocated to and for the Participants from whose Accounts they are
forfeited.
(d) Family Aggregation
The Deferral Percentage or the Contribution Percentage (the
"Relevant Percentage") for any Highly Compensated Employee who is
subject to the family aggregation rules of Section 1.18(c) will be
determined by combining the Elective Contributions, Employee
Contributions, Matching Contribution, amounts treated as Elective or
Matching Contributions and Compensation of all the eligible Family
Members.
The determination and correction of Excess Contributions and Excess
Aggregate Contributions of a Highly Compensated Employee whose
Relevant Percentage is determined under the family aggregation rules
is accomplished by reducing the Relevant Percentage as provided for
4-12
in Sections 4.05(b) and 4.05(c) and Excess Contributions or Excess
Aggregate Contributions for the family group are allocated among the
Family Members whose contributions were combined to determine the
Relevant Percentage in proportion to the Elective Contributions or
Nonelective and Matching Contributions of each Family Member.
For all purposes under this Section, the contributions and
compensation of eligible Family Members who are not Highly
Compensated Employees without regard to family aggregation are
disregarded when determining the Relevant Percentage for the
Non-highly Compensated Group.
(e) Reduction of Excess Amounts
The total Excess Contribution or total Excess Aggregate Contribution
will be reduced in a manner so that the Deferral Percentage or the
Contribution Percentage (Relevant Percentage) of the affected
Participant(s) with the highest Relevant Percentage will first be
lowered to a point not less than the level of the affected
Participant(s) with the next highest Relevant Percentage. If
further overall reductions are required to satisfy the relevant
test, each of the above Participants' (or groups of Participants')
Relevant Percentage will be lowered to a point not less than the
level of the affected Participant(s) with the next highest Relevant
Percentage, and so on continuing until sufficient total reductions
have occurred to achieve satisfaction of the relevant test.
(f) Priority of Reductions
The Plan Administrator will determine the method and order of
correcting Excess Contributions and Excess Aggregate Contributions.
The method of correcting Excess Contributions and Excess Aggregate
Contributions must meet the requirements of Code Section 401(a)(4).
The determination of whether a rate of Matching Contribution
discriminates under Code Section 401(a)(4) will be made after making
any corrective distributions of Excess Deferrals, Excess
Contributions and Excess Aggregate Contributions.
Excess Aggregate Contributions (and any attributable income) will be
corrected first, by distributing any excess Employee Contributions
(and any attributable income); then by distributing vested excess
Matching Contributions (and any attributable income); and finally,
by forfeiting or distributing non-vested Matching Contributions (and
any attributable income). The Plan will not distribute Employee
Contributions while the Matching Contributions based upon those
Employee Contributions remain allocated.
(g) Income
The income allocable to any Excess Contribution made to a given
Account for a given Plan Year will be equal to the total income
allocated to the Account for the Plan Year, multiplied by a
fraction, the numerator of which is the amount of the Excess
Contribution and the denominator of which is equal to the sum of the
balance of the Account at the beginning of the Plan Year plus the
Participant's Elective Contributions and amounts treated as Elective
Contributions for the Plan Year.
4-13
The income allocable to any Excess Aggregate Contribution made to a
given Account for a given Plan Year will be equal to the total
income allocated to the Account for the Plan Year, multiplied by a
fraction, the numerator of which is the amount of the Excess
Aggregate Contribution and the denominator of which is equal to the
sum of the balance of the Account at the beginning of the Plan Year
plus the Participant's Employee and Matching Contributions and
amounts treated as Employee and Matching Contributions for the Plan
Year.
Notwithstanding the foregoing, the Plan may use any reasonable
method for computing the income allocable to any Excess Contribution
or Excess Aggregate Contribution provided the method does not
violate Code Section 401(a)(4), is used consistently for all
corrective distributions under the Plan for the Plan Year, and is
used by the Plan for allocating income to the Participants'
Accounts.
Income includes all earnings and appreciation, including interest,
dividends, rents, royalties, gains from the sale of property, and
appreciation in the value of stocks, bonds, annuity and life
insurance contracts and other property, regardless of whether the
appreciation has been realized.
(h) Treatment as Elective Contributions
The Plan Administrator may, in its discretion, treat all or any
portion of Qualified Nonelective Contributions or Qualified Matching
Contributions or both, whether to this Plan or to any other
qualified plan which has the same Plan Year and is maintained by the
Employer or a Related Employer, as Elective Contributions for
purposes of satisfying the Deferral Percentage Test if they meet all
of the following requirements:
o All Nonelective Contributions, including the Qualified
Nonelective Contributions treated as Elective Contributions for
purposes of the Deferral Percentage Test, satisfy the
requirements of Code Section 401(a)(4);
o Any Nonelective Contributions which are not treated as Elective
Contributions for purposes of the Deferral Percentage Test or as
Matching Contributions for purposes of the Contribution
Percentage Test satisfy the requirements of Code Section
401(a)(4);
o The Qualified Matching Contributions which are treated as
Elective Contributions for purposes of the Deferral Percentage
Test are not taken into account in determining whether any
Employee Contributions or other Matching Contributions satisfy
the Contribution Percentage Test;
o Any Matching Contributions which are not treated as Elective
Contributions for purposes of the Deferral Percentage Test
satisfy the requirements of Code Section 401(m); and
4-14
o The plan which includes the Cash or Deferred Arrangement and the
plan or plans to which the Qualified Nonelective Contributions
and Qualified Matching Contributions are made could be
aggregated for purposes of Code Section 410(b).
(i) Treatment as Matching Contributions
The Plan Administrator may, in its discretion, treat all or any
portion of Qualified Nonelective Contributions or Elective
Contributions or both, whether to this Plan or to any other
qualified plan which has the same Plan Year and is maintained by the
Employer or a Related Employer, as Matching Contributions for
purposes of satisfying the Contribution Percentage Test if they meet
all of the following requirements:
o All Nonelective Contributions, including the Qualified
Nonelective Contributions treated as Matching Contributions for
purposes of the Contribution Percentage Test, satisfy the
requirements of Code Section 401(a)(4);
o Any Nonelective Contributions which are not treated as Elective
Contributions for purposes of the Deferral Percentage Test or as
Matching Contributions for purposes of the Contribution
Percentage Test satisfy the requirements of Code Section
401(a)(4);
o The Elective Contributions which are treated as Matching
Contributions for purposes of the Contribution Percentage Test
are not taken into account in determining whether any other
Elective Contributions satisfy the Deferral Percentage Test;
o The Qualified Nonelective Contributions and Elective
Contributions which are treated as Matching Contributions for
purposes of the Contribution Percentage Test are not taken into
account in determining whether any other contributions or
benefits satisfy Code Section 401(a); and
o All Elective Contributions, including those treated as Matching
Contributions for purposes of the Contribution Percentage Test,
satisfy the requirements of Code Section 401(k)(3); and
o The plan that takes Qualified Nonelective Contributions and
Elective Contributions into account in determining whether
Employee and Matching Contributions satisfy the requirements of
Code Section 401(m)(2)(A) and the plan or plans to which the
Qualified Nonelective Contributions and Elective Contributions
are made could be aggregated for purposes of Code Section
410(b).
(j) Aggregation of Plans
If the Employer or a Related Employer sponsors one or more other
plans which include a Cash or Deferred Arrangement, the Employer may
elect to treat any two or more of such plans as an aggregated single
plan for purposes of satisfying Code Sections 401(a)(4), 401(k) and
4-15
410(b). The Cash of Deferred Arrangements included in such
aggregated plans will be treated as a single Arrangement for
purposes of this Section. However, only those plans that have the
same plan year may be so aggregated.
If the Employer or a Related Employer sponsors one or more other
plans to which Employee Contributions or Matching Contributions are
made, the Employer may elect to treat any two or more of such plans
as an aggregated single plan for purposes of satisfying Code
Sections 401(a)(4), 401(m) and 410(b). However, only those plans
that have the same plan year may be so aggregated.
Any such aggregation must be made in accordance with Treasury
Regulation 1.401(k)-1(b)(3). For example, contributions and
allocations under the portion of a plan described in Code Section
4975(e)(7) (an ESOP) may not be aggregated with the portion of a
plan not described in Code Section 4975(e)(7) (a non-ESOP) for
purposes of determining whether the ESOP or non-ESOP satisfies the
requirements of Code Sections 401(a)(4), 401(k), 401(m) and 410(b).
Plans that could be aggregated under Code Section 410(b) but that
are not actually aggregated for a Plan Year for purposes of Code
Section 410(b) may not be aggregated for purposes of Code Sections
401(k) and 401(m).
4-16
ARTICLE 5
RETIREMENT BENEFITS
5.01 Valuation of Accounts
For purposes of this Article, the value of a Participant's Accrued
Benefit will be determined as of the Valuation Date coincident with or
immediately preceding the date that benefits are to be distributed.
5.02 Normal Retirement
After an Active Participant reaches his Normal Retirement Date, he may
elect to retire. Upon such retirement he will become a Retired
Participant and his Accrued Benefit will become distributable to him. A
Participant's Accrued Benefit will become nonforfeitable no later than
the date upon which he attains his Normal Retirement Age. The form of
benefit payment will be governed by the provisions of Section 5.05.
5.03 Disability Retirement
In the event of a Participant's termination due to Disability, he will
be entitled to begin to receive a distribution of his Accrued Benefit
which will become nonforfeitable as of his date of termination. The
form of benefit payment will be governed by the provisions of Section
5.05.
Disability means the determination by the Plan Administrator that a
Participant is unable by reason of any medically determinable physical
or mental impairment to perform the usual duties of his employment or of
any other employment for which he is reasonably qualified based upon his
education, training and experience.
5.04 Termination of Employment
(a) In General
If a Participant's employment terminates for any reason other than
retirement, death, or disability, his Vested Accrued Benefit will
become distributable to him as of the Valuation Date which coincides
with or next follows his date of termination of employment (or as of
such earlier date as determined by the Plan Administrator in a
uniform and nondiscriminatory manner). The form of benefit payment
will be governed by the provisions of Section 5.05.
(b) Cash-Out Distribution
If a Participant terminates employment and receives a distribution
equal to the Vested Percentage of his Accounts which are subject to
the Vesting Schedule (such Accounts are hereinafter referred to as
Employer Contribution Accounts), a Cash-Out Distribution will be
deemed to have occurred if the following conditions are met:
(1) The Participant was less than 100% vested in his Employer
Contribution Accounts; and
(2) The entire distribution is made before the last day of the
second Plan Year following the Plan Year in which the
5-1
Participant terminated employment.
(c) Restoration of Employer Contribution Accounts
If, following the date of a Cash-Out Distribution, a Participant
returns to an Eligible Employee Classification prior to incurring 5
consecutive One Year Breaks-in-Service, then the Participant will
have the right to repay to the Trustee, within 5 years after his
return date, the portion of the Cash-Out Distribution which was
attributable to his Employer Contribution Accounts which were less
than 100% vested in order to restore such Accounts to their value as
of the date of the Cash-Out Distribution.
The Plan Administrator will restore an eligible Participant's
Employer Contribution Accounts as of the Valuation Date coincident
with or immediately following the complete repayment of the Cash-Out
Distribution. To restore the Participant's Employer Contribution
Accounts, the Plan Administrator, to the extent necessary, will,
under rules and guidelines applied in a uniform and
nondiscriminatory manner, allocate to the Participant's Employer
Contribution Accounts:
o First, the amount, if any, of Forfeitures which would otherwise
be allocated under Article 3;
o Second, the amount, if any, of the Trust Fund net income or gain
for the Accounting Period.
To the extent the amounts available for restoration for a particular
Accounting Period are insufficient to enable the Plan Administrator
to make the required restoration, the Employer will contribute such
additional amount as is necessary to enable the Plan Administrator
to make the required restoration. The Plan Administrator will not
take into account the allocation under this Section in applying the
limitation on allocations under Article 7.
Until the Plan Administrator restores a Participant's Employer
Contribution Accounts, the Trustee will invest any amount the
Participant has repaid in a segregated account maintained solely for
that Participant. The Trustee will invest the amount in the
Participant's segregated account in an interest-bearing savings
account, time deposit, or similar type of account. Until commingled
with the balance of the Trust Fund on the date the Plan
Administrator restores the Participant's Employer Contribution
Accounts, the Participant's segregated account will remain a part of
the Trust, but it alone will share in any income it earns and it
alone will bear any expense or loss it incurs.
(d) Non-Vested Participant
If a Participant who is zero percent vested in his Employer
Contribution Accounts terminates employment, a Cash-Out Distribution
will be deemed to have occurred as of the Participant's date of
termination of employment.
If the Participant subsequently returns to an Eligible Employee
5-2
Classification prior to incurring five consecutive One Year
Breaks-in-Service, then the Participant will immediately become
entitled to a complete restoration of his Employer Contribution
Accounts as of the Valuation Date coincident with or next following
his date of re-employment. Such restoration will be made in
accordance with the provisions of Section 5.04(c).
5.05 Form of Benefit Payment
The Plan Administrator will direct the Trustee to make the payment of
any benefit provided under this Plan upon the event giving rise to such
benefit within the time prescribed by this Article. The form of benefit
will be a lump sum payment, unless the Participant elects a direct
transfer pursuant to Section 5.07.
If a Participant's Vested Accrued Benefit is in excess of $3,500, any
payment of benefits prior to the Participant's Normal Retirement Date
will be subject to the Participant's written consent. If the value of
his Vested Accrued Benefit at the time of any distribution exceeds
$3,500, the value of his Vested Accrued Benefit at any later time will
be deemed to also exceed $3,500.
5.06 Commencement of Benefit
Subject to the provisions of this Article, commencement of a benefit
will, unless the Participant elects otherwise in writing, begin not
later than the 60th day after the later of the close of the Plan Year in
which the Participant attains Normal Retirement Age or the close of the
Plan Year which contains the date the Participant terminates his service
with the Employer.
For purposes of this Section, life expectancy and joint and last
survivor expectancy are to be computed by the use of the return
multiples contained in Section 1.72-9 of the Income Tax Regulations.
Payment of a Participant's benefits must begin no later than his
Required Beginning Date.
If the Participant dies after distribution of his interest has begun,
the remaining portion of the interest will continue to be distributed at
least as rapidly as under the method of distribution being used before
the Participant's death.
All distributions required under this Section will be determined and
made in accordance with the regulations issued under Code Section
401(a)(9), including those dealing with minimum distribution
requirements.
5.07 Directed Transfer of Eligible Rollover Distributions
(a) General
This Section applies to distributions made on or after January 1,
1993. Notwithstanding any provision of the Plan to the contrary
that would otherwise limit a Distributee's election under this
Section, a Distributee may elect, at the time and in the manner
prescribed by the Plan Administrator, to have any portion of an
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Eligible Rollover Distribution paid directly to an Eligible
Retirement Plan specified by the Distributee in a Direct Rollover.
(b) Eligible Rollover Distribution
An Eligible Rollover Distribution is any distribution of all or any
portion of the balance to the credit of the Distributee, except that
an Eligible Rollover Distribution does not include: any distribution
that is one of a series of substantially equal periodic payments
(not less frequently than annually) made for the life (or life
expectancy) of the Distributee or the joint lives (or joint life
expectancies) of the Distributee and the Distributee's designated
beneficiary, or for a specified period of ten years or more; any
distribution to the extent such distribution is required under
section 401(a)(9) of the Code; and the portion of any distribution
that is not includible in gross income (determined without regard to
the exclusion for net unrealized appreciation with respect to
employer securities).
(c) Eligible Retirement Plan
An Eligible Retirement Plan is an individual retirement account
described in section 408(a) of the Code, an individual retirement
annuity described in section 408(b) of the Code, or a qualified
trust described in section 401(a) of the Code, that accepts the
Distributee's Eligible Rollover Distribution. However, in the case
of an Eligible Rollover Distribution to the surviving spouse, an
Eligible Retirement Plan is an individual retirement account or
individual retirement annuity.
(d) Distributee
A Distributee includes an Employee or Former Employee. In addition,
the Employee's or Former Employee's surviving spouse and the
Employee's or Former Employee's spouse or former spouse who is the
alternate payee under a qualified domestic relations order, as
defined in section 414(p) of the Code, are Distributees with regard
to the interest of the spouse or former spouse.
(e) Direct Rollover
A Direct Rollover is a payment by the Plan to the Eligible
Retirement Plan specified by the Distributee.
(f) Waiver of 30-Day Notice
If a distribution is one to which Code Sections 401(a)(11) and 417
do not apply, such distribution may commence less than 30 days after
the notice required under Section 1.411(a)-11(c) of the Income Tax
Regulations is given, provided that:
o the Plan Administrator clearly informs the Participant that the
Participant has a right to a period of at least 30 days after
receiving the notice to consider the decision of whether or not
to elect a distribution (and, if applicable, a particular
distribution option); and
o the Participant, after receiving the notice, affirmatively
elects to receive a distribution.
5-4
ARTICLE 6
DEATH BENEFIT
6.01 Valuation of Accounts
For purposes of this Article, the value of a Participant's Accrued
Benefit will be determined as of the Valuation Date coincident with or
immediately preceding the date that benefits are to be distributed.
6.02 Death Benefit
In the event of the death of a Participant prior to the date on which he
receives a complete distribution of his benefit under the Plan, the
Participant's Beneficiary will be entitled to receive the value of the
Participant's Accrued Benefit.
6.03 Designation of Beneficiary
Each Participant will be given the opportunity to designate a
Beneficiary or Beneficiaries, and from time to time the Participant may
file with the Plan Administrator a new or revised designation on the
form provided by the Plan Administrator. If a Participant is married,
any designation of a Beneficiary other than the Participant's spouse
must be consented to by the Participant's spouse pursuant to a Qualified
Election.
If a Participant dies without designating a Beneficiary, or if the
Participant is predeceased by all designated Beneficiaries and
contingent Beneficiaries, the Plan Administrator will distribute all
benefits which are payable in the event of the Participant's death in
the following manner and to the first of the following (who are listed
in order of priority) who survive the Participant by at least 30 days:
o All to the Participant's Surviving Spouse;
o Equally among the then living children of the Participant (by birth
or adoption);
o Among the Participant's then living lineal descendants, by right of
representation; or
o The Participant's estate.
6-1
ARTICLE 7
LIMITATIONS ON BENEFITS
7.01 Limitation on Annual Additions
The amount of the Annual Addition which may be allocated under this Plan
to any Participant's Account as of any Valuation Date will not exceed
the Defined Contribution Limit (based upon his Aggregate Compensation up
to such Valuation Date) reduced by the sum of any allocations of annual
additions made to Participant's Accounts under this Plan as of any
preceding Valuation Date within the Limitation Year.
If the Annual Addition under this Plan on behalf of a Participant is to
be reduced as of any Valuation Date as a result of the next preceding
paragraph, the reduction will be, to the extent required, effected by
first reducing Participant contributions (which increase the annual
addition), then Forfeitures (if any), and then Employer contributions to
be allocated under this Plan on behalf of the Participant as of the
Valuation Date.
Any necessary reduction will be made as follows:
(a) The amount of the reduction consisting of nondeductible Participant
contributions will be paid to the Participant as soon as
administratively feasible.
(b) The amount of the reduction consisting of any other Participant
contributions will be paid to the Participant as soon as
administratively feasible.
(c) The amount of the reduction consisting of Forfeitures will be
allocated and reallocated to other Accounts in accordance with the
Plan formula for allocating Forfeitures to the extent that such
allocations do not cause the additions to any other Participant's
Accounts to exceed the lesser of the Defined Contribution Limit or
any other limitation provided in the Plan.
(d) The amount of the reduction consisting of Employer contributions
will be allocated and reallocated to other Accounts in accordance
with the Plan formula for Employer Contributions to the extent that
such allocations do not cause the additions to any other
Participant's Accounts to exceed the lesser of the Defined
Contribution Limit or any other limitation provided in the Plan.
(e) To the extent that the reductions described in paragraph (d) cannot
be allocated to other Participant's Accounts, the reductions will be
allocated to a suspense account as Forfeitures and held therein
until the next succeeding Valuation Date on which Forfeitures could
be applied under the provisions of the Plan. All amounts held in a
suspense account must be applied as Forfeitures before any
additional contributions, which would constitute annual additions,
may be made to the Plan. If the Plan terminates, the suspense
account will revert to the Employer to the extent it may not be
7-1
allocated to any Participant's Accounts.
(f) If a suspense account is in existence at any time during a
Limitation Year pursuant to this Section, it will not participate in
the allocation of the Trust Fund's investment gains and losses.
7.02 Where Employer Maintains Another Qualified Plan
(a) Where Employer Maintains Another Qualified Defined Contribution Plan
If the Employer maintains this Plan and one or more other qualified
defined contribution plans, one or more welfare benefit funds (as
defined in Code Section 419(e)), or one or more individual medical
accounts (as defined in Code Section 415(l)(2)), all of which are
referred to in this Article 7 as "qualified defined contribution
plans", the annual additions allocated under this Plan to any
Participant's Accounts will be limited in accordance with the
allocation provisions of this Section 7.02(a).
The amount of the Annual Additions which may be allocated under this
Plan to any Participant's Accounts as of any Valuation Date will not
exceed the Defined Contribution Limit (based upon Aggregate
Compensation up to the allocation date) reduced by the sum of any
allocations of Annual Additions made to the Participant's Accounts
under this Plan and any other qualified defined contribution plans
maintained by the Employer as of any earlier Valuation Date within
the Limitation Year.
If a Valuation Date of this Plan coincides with a Valuation Date of
any other plan described in the above paragraph, the amount of
Annual Additions to be allocated on behalf of a Participant under
this Plan as of such date will be an amount equal to the product of
the amount described in the next preceding paragraph multiplied by a
fraction (not to exceed 1.0), the numerator of which is the amount
to be allocated under this Plan without regard to this Article
during the Limitation Year and the denominator of which is the
amount that would otherwise be allocated on this Valuation Date
under all plans without regard to this Article 7.
If the Annual Addition under this Plan on behalf of a Participant is
to be reduced as of any Valuation Date as a result of the next
preceding two paragraphs, the reduction will be, to the extent
required, effected by first reducing Participant contributions
(which increase the annual addition), then Forfeitures (if any), and
then any Employer contributions, to be allocated under this Plan on
behalf of the Participant as of the Valuation Date.
If as a result of the first four paragraphs of this Section 7.02 the
allocation of additions is reduced, the reduction will be treated in
the manner described in the third paragraph of Section 7.01.
7-2
(b) Where Employer Maintains a Qualified Defined Benefit Plan
(1) In General
If the Employer maintains (or has ever maintained), in addition
to this Plan, one or more qualified defined benefit plans, then
for any Limitation Year, the sum of the Defined Benefit Plan
Fraction and the Defined Contribution Plan Fraction will not
exceed 1.0. If, in any Limitation Year, the sum of the Defined
Benefit Plan Fraction and the Defined Contribution Plan Fraction
for a Participant would exceed 1.0 without adjustment to the
amount of the annual benefit that can be paid to the Participant
under the defined benefit plan, then the amount of annual
benefit that would otherwise be paid to the Participant under
the defined benefit plan will be reduced to the extent necessary
to reduce the sum of the Defined Benefit Plan Fraction and the
Defined Contribution Plan Fraction for the Participant to 1.0.
(2) Transition Rule under TRA '86
If a plan was in existence on May 6, 1986, the numerator of the
Defined Contribution Plan Fraction will be reduced (to not less
than zero) as prescribed by the Secretary of the Treasury by
subtracting the amount required to decrease the sum of the
Defined Contribution Plan Fraction plus the Defined Benefit Plan
Fraction to 1.0. Such amount is determined (as of the first day
of the first Limitation Year beginning on or after January 1,
1987) as the product of:
(A) The amount by which, without this adjustment, the sum of the
Defined Contribution Plan Fraction plus the Defined Benefit
Plan Fraction exceeds 1.0, multiplied by
(B) The denominator of the Defined Contribution Plan Fraction,
as computed through the last Limitation Year beginning
before January 1, 1987, disregarding any changes in the
terms and conditions of the plan after May 5, 1986.
This subparagraph applies only if the defined benefit plans
individually and in the aggregate satisfied the requirements of
Code Section 415 for all Limitation Years beginning before
January 1, 1987.
(3) Transition Rule under TEFRA
In the case of a plan which met the limitation of Section 415 of
the Code for the last Limitation Year beginning before January
1, 1983, the numerator of the Defined Contribution Plan Fraction
will be reduced (to not less than zero) as prescribed by the
Secretary of the Treasury by subtracting the amount required to
decrease the sum of the Defined Contribution Plan Fraction plus
the Defined Benefit Plan Fraction to 1.0. Such amount is
determined (as of the first day of the first Limitation Year
beginning on or after January 1, 1983) as the product of:
(A) The amount by which, without this adjustment, the sum of the
Defined Contribution Plan Fraction plus the Defined Benefit
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Plan Fraction exceeds 1.0, multiplied by
(B) The denominator of the Defined Contribution Plan Fraction,
as computed through the last Limitation Year beginning
before January 1, 1983.
7.03 Definitions Applicable to Article 7
(a) Aggregate Compensation
Aggregate Compensation means a Participant's earned income, wages,
salaries, and fees for professional services, and other amounts
received for personal services actually rendered in the course of
employment with the employer maintaining the plan (including, but
not limited to, commissions paid to salesmen, compensation for
services on the basis of a percentage of profits, commissions on
insurance premiums, tips and bonuses), and excluding the following:
o Employer contributions to a plan of deferred compensation which
are not included in the employee's gross income for the taxable
year in which contributed or employer contributions under a
simplified employee pension plan to the extent the contributions
are deductible by the employee, or any distributions from a plan
of deferred compensation;
o Amounts realized from the exercise of a nonqualified stock
option, or when restricted stock (or property) held by the
employee either becomes freely transferable or is no longer
subject to a substantial risk of forfeiture;
o Amounts realized from the sale, exchange or other disposition of
stock acquired under a qualified stock option; and
o Other amounts which received special tax benefits, or
contributions made by the employer (whether or not under a
salary reduction agreement) toward the purchase of an annuity
described in Code Section 403(b) (whether or not the amounts are
actually excludable from the gross income of the employee).
Aggregate Compensation excludes any amounts contributed by the
Employer or any Related Employer on behalf of any Employee pursuant
to a salary reduction agreement which are not includable in the
gross income of the Employee due to Code Section 125, 402(a)(8),
402(h) or 403(b).
Aggregate Compensation in excess of $200,000 (as adjusted in
accordance with Code Section 401(a)(17)) is disregarded.
Aggregate Compensation for any Limitation Year is the Aggregate
Compensation actually paid or includable in gross income in such
year.
(b) Allocation Date, Valuation Date
These terms are used interchangeably and mean the date with respect
to which all or a portion of employer contributions, employee
7-4
contributions or forfeitures or both are allocated to participant
accounts under a defined contribution plan.
(c) Annual Additions
For Plan Years beginning after December 31, 1986, Annual Additions
are the sum of the following amounts allocated to any defined
contribution plan maintained by the Employer (including voluntary
contributions to any defined benefit plan maintained by the
Employer) on behalf of a Participant for a Limitation Year:
o All Employee and Employer contributions;
o All reallocated forfeitures;
o Amounts allocated after March 31, 1984, to an individual medical
account, as defined in Code Section 415(l)(2) which is part of a
pension or annuity plan maintained by the Employer, and amounts
derived from contributions paid or accrued after December 31,
1985, in taxable years ending after that date, which are
attributable to post-retirement medical benefits required by
Code Section 401(h)(6) to be allocated to the separate account
of a Key Employee under a welfare benefit plan (as defined in
Code Section 419(e)) maintained by the Employer.
Contributions or forfeitures will be treated as Annual Additions
regardless of whether they constitute Excess Deferrals, Excess
Contributions or Excess Aggregate Contributions within the meaning
of the regulations under Code Section 401(k) or 401(m) and
regardless of whether they are corrected through distribution or
recharacterization. The Annual Addition for any Limitation Year
beginning before January 1, 1987, will not be recomputed to treat
all Employee contributions as Annual Additions.
(d) Annual Benefit
Annual Benefit means a benefit payable annually in the form of a
straight life annuity (with no ancillary benefits) under a plan to
which employees do not contribute and under which no rollover
contributions are made.
(e) Defined Benefit Compensation Limit
The Defined Benefit Compensation Limit is equal to 100% of the
Participant's average Aggregate Compensation for the three
consecutive calendar years (or other twelve consecutive month
periods adopted by the Employer pursuant to a Written Resolution and
applied on a uniform and consistent basis) of service during which
the Participant had the greatest Aggregate Compensation.
Where the annual benefit is payable to a Participant in a form other
than a straight life annuity or a Qualified Joint and Survivor
Annuity, the Defined Benefit Compensation Limit will be the
Actuarial Equivalent of a straight life annuity beginning at the
same age. No adjustment is required for the following:
pre-retirement disability benefits, pre-retirement death benefits
and post-retirement medical benefits. For purposes of this
7-5
paragraph, the interest rate used in adjusting the Defined Benefit
Compensation Limit will be the greater of (1) 5%, or (2) the
post-retirement interest rate specified in the plan for Actuarial
Equivalent purposes.
Where the annual benefit is payable to a Participant who has fewer
than 10 years of service with the Employer or any Related or
Predecessor Employer, the Defined Benefit Compensation Limit will be
multiplied by a fraction, the numerator of which is the
Participant's number of years of service with the Employer or
Related or Predecessor Employer, and the denominator of which is
10.
With regard to a Participant who has separated from service with a
nonforfeitable right to an Accrued Benefit, the Defined Benefit
Compensation Limit will be adjusted effective January 1 of each
Calendar year. For any Limitation Year beginning after the
separation occurs, the Defined Benefit Compensation Limit will be
equal to the Defined Benefit Compensation Limit which was applicable
to the Participant in the Limitation Year in which he separated from
service multiplied by a fraction, the numerator of which is the
Defined Benefit Dollar Limit for the Limitation Year in which the
Defined Benefit Compensation Limit is being adjusted and the
denominator of which is the Defined Benefit Dollar Limit for the
Limitation Year in which the Participant separated from service.
(f) Defined Benefit Dollar Limit
The Defined Benefit Dollar Limit is equal to $90,000 for calendar
years 1984 through 1987. As of January 1, 1988 and as of January 1
of each subsequent calendar year, the dollar limitation (described
in Code Section 415(b)(1)(A)) as determined by the Secretary of the
Treasury for that calendar year will become effective as the Defined
Benefit Dollar Limit for the calendar year. For calendar years
between 1976 and 1983, the Defined Benefit Dollar Limit is $75,000
as adjusted by the Secretary of the Treasury under Code Section
415(d) for that calendar year. The Defined Benefit Dollar Limit for
a calendar year applies to Limitation Years ending with or within
that calendar year.
Where the annual benefit is payable to a Participant in a form other
than a straight life annuity or a Qualified Joint and Survivor
Annuity, the Defined Benefit Dollar Limit will be the Actuarial
Equivalent of a straight life annuity beginning at the same age. No
adjustment is required for the following: pre-retirement disability
benefits, pre-retirement death benefits, and post-retirement medical
benefits. For purposes of this paragraph, the interest rate used
for adjusting the Defined Benefit Dollar Limit will be the greater
of (1) 5%, or (2) the post-retirement interest rate specified for
Actuarial Equivalent purposes.
Where the annual benefit is payable to a Participant who has fewer
than 10 years of participation in the Plan, the Defined Benefit
Dollar Limit will be multiplied by a fraction, the numerator of
which is the Participant's number of years (or part thereof) of
7-6
participation in the Plan, and the denominator of which is 10. To
the extent provided by the Secretary of the Treasury, this paragraph
will be applied to each change in the benefit structure of the
Plan.
For a benefit commencing before a Participant's Social Security
Retirement Age but at or after age 62, the Defined Benefit Dollar
Limit will be adjusted in a manner which is consistent with the
reduction for old-age insurance benefits commencing before Social
Security Retirement Age under the Social Security Act. The
reduction will be 5/9 of 1% for each of the first 36 months and 5/12
of 1% for each additional month (up to 24 months) by which benefits
commence before the month of the Participant's Social Security
Retirement Age. The Defined Benefit Dollar Limit for a benefit
commencing before age 62 will be adjusted to the Actuarial
Equivalent of the Defined Benefit Dollar Limit for a benefit
commencing at age 62 based on an interest rate equal to the greater
of (1) 5%, or (2) the interest rate specified in the plan for
determining actuarial equivalence for early retirement.
For a benefit commencing after a Participant's Social Security
Retirement Age, the Defined Benefit Dollar Limit will be adjusted to
the actuarial equivalent of the Defined Benefit Dollar Limit for a
benefit commencing at the Participant's Social Security Retirement
Age. For purposes of this paragraph, the interest rate used for
adjusting the Defined Benefit Dollar Limit will be the lesser of (1)
5%, or (2) the interest rate specified in the plan for determining
actuarial equivalence for early retirement.
(g) Defined Benefit Limit
The Defined Benefit Limit is the lesser of the Defined Benefit
Dollar Limit or the Defined Benefit Compensation Limit.
(h) Defined Benefit Plan Fraction Denominator
The Defined Benefit Plan Fraction Denominator with respect to any
Participant is the lesser of (1) the product of the Defined Benefit
Dollar Limit multiplied by 1.25, or (2) the product of the Defined
Benefit Compensation Limit multiplied by 1.4. However, for purposes
of determining the Defined Benefit Plan Fraction Denominator, "years
of service with the Employer or any Related or Predecessor Employer"
will be substituted for "years of participation in the Plan"
wherever it appears in Section 7.03(f).
(i) Defined Benefit Plan Fraction
The Defined Benefit Plan Fraction is a fraction determined as of the
close of a Limitation Year, the numerator of which is the Projected
Annual Benefit payable to a Participant under this Plan and the
denominator of which is the Defined Benefit Fraction Denominator.
If a Participant has participated in more than one defined benefit
plan maintained by the Employer, the numerator of the Defined
Benefit Plan Fraction is the sum of the projected annual benefits
payable to the Participant under all of the defined benefit plans,
whether or not terminated.
7-7
(j) Defined Contribution Limit
The Defined Contribution Limit for a given Limitation Year is equal
to the lesser of (1) the Defined Contribution Compensation Limit,
which is 25% of Aggregate Compensation applicable to the Limitation
Year, or (2) the Defined Contribution Dollar Limit, which, for
calendar years after 1983 is the greater of $30,000 or one-fourth of
the Defined Benefit Dollar Limit for the Limitation Year, and for
calendar years between 1976 and 1983 is one-third of the Defined
Benefit Dollar Limit. If a short Limitation Year is created because
of an amendment changing the Limitation Year to a different 12
consecutive month period, the Defined Contribution Dollar Limit is
multiplied by a fraction, the numerator of which is equal to the
number of months in the short Limitation Year and the denominator of
which is 12.
(k) Defined Contribution Plan Fraction
The Defined Contribution Plan Fraction is a fraction determined as
of the close of a Limitation Year, the numerator of which is the sum
of the Annual Additions to the Participant's Accounts under all
defined contribution plans of the Employer for the current and all
prior Limitation Years and the denominator of which is the sum of
the Annual Additions which would have been made for the Participant
for the current and all prior Limitation Years (for all prior years
of service with the Employer or any predecessor Employer) if in each
Limitation year the Annual Additions equaled the lesser of (1) the
product of the Defined Contribution Compensation Limit for the
Limitation Year multiplied by 1.4, or (2) the product of the Defined
Contribution Dollar Limit for the Limitation Year multiplied by
1.25. The aggregate amount in the numerator of this fraction due to
years beginning before January 1, 1976 may not exceed the aggregate
amount in the denominator of this fraction for all such years.
For purposes of this Section 7.03(k), the Annual Addition for any
Limitation Year beginning before January 1, 1987 will not be
recomputed to treat all Employee contributions as Annual Additions.
(l) Employer
The Employer is the Employer that adopts this Plan together with all
Related Employers. For this purpose, the definition of Related
Employer in Section 1.33 of this Plan is modified by Code Section
415(h).
(m) Limitation Year
The Limitation Year will be the 12 consecutive month period which is
specified in Article 1 of this Plan and which is adopted for all
qualified plans maintained by the Employer pursuant to a Written
Resolution adopted by the Employer. In the event of a change in the
Limitation Year, the additional limitations of Treasury Regulation
Section 1.415-2(b)(4)(iii) will also apply.
(n) Projected Annual Benefit
For purposes of this Section, a Participant's Projected Annual
Benefit is equal to the annual benefit to which a Participant in a
defined benefit Plan would be entitled under the terms of the plan
7-8
based on the following assumptions:
o The Participant will continue employment until reaching normal
retirement age as determined under the terms of the plan (or
current age, if that is later);
o The Participant's compensation for the Limitation Year under
consideration will remain the same for all future years;
o All other relevant factors used to determine benefits under the
plan for the Limitation Year under consideration will remain
constant for all future Limitation Years; and
o The benefits resulting from any Participant Contributions or
Rollover Contributions are disregarded.
(o) Social Security Retirement Age
Social Security Retirement Age means age 65 for a Participant born
before January 1, 1938; age 66 for a Participant born after December
31, 1937, but before January 1, 1955; and age 67 for a Participant
born after December 31, 1954.
(p) Transition Rule Under TRA '86
If at the beginning of the first Limitation Year beginning after
December 31, 1986, an Employee was a Participant in a defined
benefit plan of the Employer or any Related Employer that was in
existence on May 6, 1986, the Defined Benefit Dollar Limit for that
Participant is the greater of the Defined Benefit Dollar Limit
described above or the Participant's Current Accrued Benefit on that
date determined without regard to changes in the terms and
conditions of the Plan or cost-of-living increases occurring after
May 5, 1986. This Section 7.03(p) applies only if all defined
benefit plans maintained by the Employer and all Related Employers,
individually and in the aggregate, satisfied the requirements of
Code Section 415 for all Limitation Years beginning before January
1, 1987.
(q) Transition Rule Under TEFRA
The Defined Benefit Dollar Limit for a Participant in a defined
benefit plan of the Employer or any Related Employer that was in
existence on July 1, 1982, will not be less than the protected
current accrued benefit, payable annually, provided under question
T-3 of Internal Revenue Service Notice 83-10.
7.04 Effect of Top-Heavy Status
(a) General
Notwithstanding the provisions of Section 7.03, "1.0" will be
substituted for "1.25" wherever it appears in Sections 7.03(h) and
7.03(k) for any Limitation Year in which the Plan is found to be
Top-Heavy for the Plan Year which coincides with or ends within such
Limitation Year.
7-9
(b) Non-application
Section 7.04(a) will not apply for any Limitation Year in which, for
the Plan Year which coincides with or ends within such Limitation
Year, (1) the Plan is not determined to be Super Top-Heavy and (2)
for any Non-Key Employee who is a Participant in both this Plan and
a defined benefit plan maintained by the Employer or a Related
Employer, the annual allocation of Employer contributions plus
Forfeitures under this Plan is not less than 7.5% of the Non-Key
Employee's Aggregate Compensation.
7-10
ARTICLE 8
MISCELLANEOUS
8.01 Employment Rights of Parties Not Restricted
The adoption and maintenance of this Plan will not be deemed a contract
between the Employer and any Employee. Nothing in this Plan will give
any Employee or Participant the right to be retained in the employ of
the Employer or to interfere with the right of the Employer to discharge
any Employee or Participant at any time, nor will it give the Employer
the right to require any Employee or Participant to remain in its
employ, or to interfere with any Employee's or Participant's right to
terminate his employment at any time.
8.02 Alienation
(a) General
No person entitled to any benefit under this Plan will have any
right to sell, assign, transfer, hypothecate, encumber, commute,
pledge, anticipate or otherwise dispose of his interest in the
benefit, and any attempt to do so will be void. No benefit under
this Plan will be subject to any legal process, levy, execution,
attachment or garnishment for the payment of any claim against such
person.
(b) Exceptions
Section 8.02(a) will not apply to the extent a Participant or
Beneficiary is indebted to the Plan under the provisions of the
Plan. At the time a distribution is to be made to or for a
Participant's or Beneficiary's benefit, the portion of the amount
distributed which equals the indebtedness will be withheld by the
Trustee to apply against or discharge the indebtedness. Before
making a payment, however, the Participant or Beneficiary must be
given written notice by the Plan Administrator that the indebtedness
is to be so paid in whole or part from his Participant's Accrued
Benefit. If the Participant or Beneficiary does not agree that the
indebtedness is a valid claim against his Vested Accrued Benefit, he
will be entitled to a review of the validity of the claim in
accordance with procedures established by the Plan Administrator.
Section 8.02(a) will not apply to a qualified domestic relations
order (QDRO) as defined in Code Section 414(p), and those other
domestic relations orders permitted to be so treated by the Plan
Administrator under the provisions of the Retirement Equity Act of
1984. The Plan Administrator will establish a written procedure to
determine the qualified status of domestic relations orders and to
administer distributions under such qualified orders. Further, to
the extent provided under a QDRO, a former spouse of a Participant
will be treated as the spouse or Surviving Spouse for all purposes
under the Plan. Where, however, because of a QDRO, more than one
individual is to be treated as a Surviving Spouse, the total amount
to be paid in the form of a Qualified Survivor Annuity or the
survivor portion of a Qualified Joint and Survivor Annuity may not
exceed the amount that would be paid if there were only one
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Surviving Spouse. All rights and benefits, including elections,
provided to a Participant under this Plan will be subject to the
rights afforded to any alternate payee as such term is defined in
Code Section 414(p).
This Plan specifically permits distribution to an alternate payee
under a QDRO (without regard to whether the Participant has attained
his or her earliest retirement age as that term is defined under
Code Section 414(p)) in the same manner that is provided for a
Vested Terminated Participant.
8.03 Qualification of Plan
The Employer will have the sole responsibility for obtaining and
retaining qualification of the Plan under the Code with respect to the
Employer's individual circumstances.
8.04 Construction
To the extent not preempted by ERISA, this Plan will be construed
according to the laws of the state in which the Employer's principal
place of business is located. Words used in the singular will include
the plural, the masculine gender will include the feminine, and vice
versa, whenever appropriate.
8.05 Named Fiduciaries
(a) Allocation of Functions
The authority to control and manage the operation and administration
of the Plan and Trust created by this instrument will be allocated
between the Plan Sponsor and the Plan Administrator, each of whom
are designated as Named Fiduciaries with respect to the Plan and
Trust as provided for by Section 402(a)(2) of ERISA. The Plan
Sponsor reserves the right to allocate the various responsibilities
for the present execution of the functions of the Plan, other than
the Trustees' responsibilities, among its Named Fiduciaries. Any
person or group of persons may serve in more than one fiduciary
capacity with regard to the Plan.
(b) Responsibilities of the Plan Sponsor
The Plan Sponsor, in its capacity as a Named Fiduciary, will have
only the following authority and responsibility:
o To appoint or remove the Plan Administrator and furnish the
Trustee with certified copies of any resolutions of the Plan
Sponsor with regard thereto;
o To appoint and remove the Trustee;
o To appoint a successor Trustee or additional Trustees;
o To communicate information to the Plan Administrator and the
Trustee as needed for the proper performance of the duties of
each;
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o To appoint an investment manager (or to refrain from such
appointment), to monitor the performance of the investment
manager so appointed, and to terminate such appointment (more
than one investment manger may be appointed and in office at any
time); and
o To establish and communicate to the Trustee a funding policy for
the Plan.
(c) Limitation on Obligations of Named Fiduciaries
No Named Fiduciary will have authority or responsibility to deal
with matters other than as delegated to it under this Plan or by
operation of law. A Named Fiduciary will not in any event be liable
for breach of fiduciary responsibility or obligation by another
fiduciary (including Named Fiduciaries) if the responsibility or
authority of the act or omission deemed to be a breach was not
within the scope of the Named Fiduciary's authority or delegated
responsibility.
(d) Standard of Care and Skill
The duties of each fiduciary will be performed with the care, skill,
prudence and diligence under the circumstances then prevailing that
a prudent person acting in a like capacity and familiar with such
matters would use in the conduct of an enterprise of like character
and with like objectives.
8.06 Status of Insurer
The term Insurer refers to any legal reserve life insurance company
licensed to do business in the state within which the Employer maintains
its principal office. The Insurer will file such returns, keep such
records, make such reports and supply such information as required by
applicable law or regulation.
8.07 Adoption and Withdrawal by Other Organizations
(a) Procedure for Adoption
Subject to the provisions of this Section 8.07, any organization now
in existence or hereafter formed or acquired, which is not already a
Participating Employer under this Plan and which is otherwise
legally eligible may, in the future, with the consent and approval
of the Plan Sponsor, by formal Written Resolution (referred to in
this Section as an Adoption Resolution), adopt the Plan and Trust
hereby created for all or any classification of persons in its
employment and thereby, from and after the specified effective date,
become a Participating Employer under this Plan. Such consent will
be effected by and evidenced by a formal Written Resolution of the
Plan Sponsor. The Adoption Resolution may contain such specific
changes and variations in Plan terms and provisions applicable to
the adopting Participating Employer and its Employees as may be
acceptable to the Plan Sponsor and the Trustee. However, the sole,
exclusive right of any other amendment of whatever kind or extent to
the Plan is reserved to the Plan Sponsor. The Adoption Resolution
will become, as to the adopting organization and its Employees, a
part of this Plan as then amended or thereafter amended. It will
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not be necessary for the adopting organization to sign or execute
the original or then amended Plan and Trust Agreement or any future
amendment to the Plan and Trust Agreement. The effective date of
the Plan for the adopting organization will be that stated in the
Adoption Resolution and from and after such effective date the
adopting organization will assume all the rights, obligations and
liabilities as a Participating Employer under this Plan. The
administrative powers of and control by the Plan Sponsor as provided
in the Plan, including the sole right of amendment or termination of
the Plan, of appointment and removal of the Plan Administrator and
the Trustee, and of appointment and removal of an investment manager
will not be diminished by reason of the participation of the
adopting organization in the Plan.
(b) Withdrawal
Any Participating Employer may withdraw from the Plan at any time,
without affecting the Plan Sponsor or other Participating Employers
not withdrawing, by complying with the provisions of the Plan. A
withdrawing Participating Employer may arrange for the continuation
by itself or its successor of this Plan in separate forms for its
own employees, with such amendments, if any, as it may deem proper,
and may arrange for continuation of the Plan by merger with an
existing plan and transfer of plan assets. The Plan Sponsor may, it
its absolute discretion, terminate a Participating Employer's
participation at any time when in its judgment the Participating
Employer fails or refuses to discharge its obligations under the
Plan.
(c) Adoption Contingent Upon Initial and Continued Qualifications
The adoption of this Plan by an organization as provided is hereby
made contingent and subject to the condition precedent that said
adopting organization meets all the statutory requirements for
qualified plans, including, but not limited to, Sections 401(a) and
501(a) of the Internal Revenue Code for its Employees. If the Plan
or the Trust, in its operation, becomes disqualified, for any
reason, as to the adopting organization and its Employees, the
portion of the Plan assets allocable to them will be segregated as
soon as is administratively feasible, pending either the prompt (1)
requalification of the Plan as to the organization and its employees
to the satisfaction of the Internal Revenue Service so as not to
affect the continued qualified status thereof as to other Employers,
(2) withdrawal of the organization from this Plan and a continuation
by itself or its successor of its plan separately from this Plan, or
by merger with another existing plan, with a transfer of its said
segregated portion of Plan assets, or (3) termination of the Plan as
to itself and its Employees.
8.08 Employer Contributions
Employer contributions made to the Plan and Trust are made and will be
held for the sole purpose of providing benefits to Participants and
their Beneficiaries.
In no event will any contribution made by the Employer to the Plan and
Trust or income therefrom revert to the Employer except as provided in
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Section 7.01(e) or as provided below.
(a) Any contribution made to the Plan and Trust by the Employer because
of a mistake of fact may be returned to the Employer within one year
of such contribution.
(b) Notwithstanding any other provision of the Plan and Trust, if the
Internal Revenue Service determines initially that the Plan, as
adopted by the Employer, does not qualify under applicable sections
of the Code and applicable Treasury Department Regulations, and the
Employer does not wish to amend this Plan and Trust so that it does
qualify, the value of all assets will be distributed by the Trustee
to the Employer within one year after the date such initial
qualification is denied. Thereafter, the Employer's participation
in this Plan and Trust will be considered rescinded and of no force
or effect.
(c) Any contribution made by the Employer will be conditioned on the
deductibility of such contribution and may be refunded to the
Employer, to the extent the contribution is determined not to be
deductible, within one year after such determination is made.
8-5
ARTICLE 9
ADMINISTRATION
9.01 Plan Administrator
The Plan Administrator will have the responsibility for the general
supervision and administration of the Plan and will be a fiduciary of
the Plan. The Employer may, by Written Resolution, appoint one or more
individuals to serve as Plan Administrator. If the Employer does not
appoint an individual or individuals as Plan Administrator, the Employer
will function as Plan Administrator. The Employer may at any time, with
or without cause, remove an individual as Plan Administrator or
substitute another individual therefor.
9.02 Powers and Duties of the Plan Administrator
The Plan Administrator will be charged with and will have delegated to
it the power, duty, authority and discretion to interpret and construe
the provisions of this Plan, to determine its meaning and intent and to
make application thereof to the facts of any individual case; to
determine in its discretion the rights and benefits of Participants or
the eligibility of Employees; to give necessary instructions and
directions to the Trustee and the Insurer as herein provided or as may
be requested by the Trustee and the Insurer from time to time; to
resolve all questions of fact relating to any of the foregoing; and to
generally direct the administration of the Plan according to its terms.
All decisions of the Plan Administrator in matters properly coming
before it according to the terms of this Plan, and all actions taken by
the Plan Administrator in the proper exercise of its administrative
powers, duties and responsibilities, will be final and binding upon all
Employees, Participants and Beneficiaries and upon any person having or
claiming any rights or interest in this Plan. The Employer and the Plan
Administrator will make and receive any reports and information, and
retain any records necessary or appropriate to the administration of
this Plan or to the performance of duties hereunder or to satisfy any
requirements imposed by law. In the performance of its duties, the Plan
Administrator will be entitled to rely on information duly furnished by
any Employee, Participant or Beneficiary or by the Employer or Trustee.
9.03 Actions of the Plan Administrator
The Plan Administrator may adopt such rules as it deems necessary,
desirable or appropriate with respect to the conduct of its affairs and
the administration of the Plan. Whenever any action to be taken in
accordance with the terms of the Plan requires the consent or approval
of the Plan Administrator, or whenever an interpretation is to be made
of the terms of the Plan, the Plan Administrator will act in a uniform
and non-discriminatory manner, treating all Employees and Participants
in similar circumstances in a like manner. If the Plan Administrator is
a group of individuals, all of its decisions will be made by a majority
vote. The Plan Administrator will have the authority to employ one or
more persons to render advice or services with regard to the
responsibilities of the Plan Administrator, including but not limited to
attorneys, actuaries, and accountants. Any persons employed to render
advice or services will have no fiduciary responsibility for any
ministerial functions performed with respect to this Plan.
9-1
9.04 Reliance on Plan Administrator and Employer
Until the Employer gives notice to the contrary, the Trustee and any
persons employed to render advice or services will be entitled to rely
on the designation of Plan Administrator that has been furnished to
them. In addition, the Trustee and any persons employed to render
advice or services will be fully protected in acting upon the written
directions and instructions of the Plan Administrator made in accordance
with the terms of this Plan. If the Plan Administrator is a group of
individuals, unless otherwise specified, any one of such individuals
will be authorized to sign documents on behalf of the Plan Administrator
and such authorized signatures will be recognized by all person dealing
with the Plan Administrator. The Trustee and any persons employed to
render advice or services may take cognizance of any rules established
by the Plan Administrator and rely upon them until notified to the
contrary. The Trustee and any persons employed to render advice or
services will be fully protected in taking any action upon any paper or
document believed to be genuine and to have been properly signed and
presented by the Plan Administrator, Employer or any agent of the Plan
Administrator acting on behalf of the Plan Administrator.
9.05 Reports to Participants
The Plan Administrator will report in writing to a Participant his
Accrued Benefit under the Plan and the Vested Percentage of such benefit
when the Participant terminates his employment or requests such a report
in writing from the Plan Administrator. To the extent required by law
or regulation, the Plan Administrator will annually furnish to each
Participant, and to each Beneficiary receiving benefits, a report which
fairly summarizes the Plan's most recent report.
9.06 Bond
The Plan Administrator and other fiduciaries of the Plan will be bonded
to the extent required by ERISA or other applicable law. No additional
bond or other security for the faithful performance of any duties under
this Plan will be required.
9.07 Compensation of Plan Administrator
The Compensation of the Plan Administrator will be left to the
discretion of the Plan Sponsor; no person who is receiving full pay from
the Employer will receive compensation for services as Plan
Administrator. All reasonable and necessary expenses incurred by the
Plan Administrator in supervising and administering the Plan will be
paid from the Plan assets by the Trustee at the direction of the Plan
Administrator to the extent not paid by the Plan Sponsor.
9.08 Claims Procedure
The Plan Administrator will make all determinations as to the rights of
any Employee, Participant, Beneficiary or other person under the terms
of this Plan. Any Employee, Participant or Beneficiary, or person
claiming under them, may make claim for benefit under this Plan by
filing written notice with the Plan Administrator setting forth the
substance of the claim. If a claim is wholly or partially denied, the
claimant will have the opportunity to appeal the denial upon filing with
the Plan Administrator a written request for review within 60 days after
9-2
receipt of notice of denial. In making an appeal the claimant may
examine pertinent Plan documents and may submit issues and comments in
writing. Denial of a claim or a decision on review will be made in
writing by the Plan Administrator delivered to the claimant within 60
days after receipt of the claim or request for review, unless special
circumstances require an extension of time for processing the claim or
review, in which event the Plan Administrator's decision must be made as
soon as possible thereafter but not beyond an additional 60 days. If no
action on an initial claim is taken within 120 days, the claims will be
deemed denied for purposes of permitting the claimant to proceed to the
review stage. The denial of a claim or the decision on review will
specify the reasons for the denial or decision and will make reference
to the pertinent Plan provisions upon which the denial or decision is
based. The denial of a claim will also include a description of any
additional material or information necessary for the claimant to perfect
the claim and an explanation of the claim review procedure herein
described. The Plan Administrator will serve as an agent for service of
legal process with respect to the Plan unless the Employer, through
written resolution, appoints another agent.
If a Participant or Beneficiary is entitled to a distribution from the
Plan, the Participant or Beneficiary will be responsible for providing
the Plan Administrator with his current address. If the Plan
Administrator notifies the Participant or Beneficiary by registered mail
(return receipt requested) at his last known address that he is entitled
to a distribution and also notifies him of the provisions of this
paragraph, and the Participant or Beneficiary fails to claim his
benefits under the Plan or provide his current address to the Plan
Administrator within one year after such notification, the distributable
amount will be forfeited and used to reduce the cost of the Plan. If
the Participant or Beneficiary is subsequently located, such benefit
will be restored.
9.09 Liability of Fiduciaries
Except for a breach of fiduciary responsibility due to gross negligence
or willful misconduct, the Plan Administrator will not incur any
individual liability for any decision, act, or failure to act
hereunder. The Plan Administrator may engage agents to assist it and
may engage legal counsel who may be counsel for the Employer. The Plan
Administrator will not be responsible for any action taken or omitted to
be taken on the advice of counsel.
The Trustee will be solely responsible for its own acts or omissions.
The Trustee will have no duty to question any other fiduciary's
performance of duties allocated to such other fiduciary pursuant to the
Plan.
If there is more than one person serving as a fiduciary in any capacity,
each will use reasonable care to prevent the other or others from
committing a breach of this Plan. Nothing contained in this Section
will preclude any agreement allocating specific responsibilities or
obligations among the co-fiduciaries provided that the agreement does
not violate any of the terms and provisions of this Plan. In those
instances where any duties have been allocated between co-fiduciaries, a
9-3
fiduciary will not be liable for any loss resulting to the Plan arising
from any act or omission on the part of another co-fiduciary to whom
responsibilities or obligations have been allocated except under the
following circumstances:
o If he participates knowingly in, or knowingly undertakes to conceal,
an act or omission of a co-fiduciary knowing the act or omission is
a breach; or
o If by his failure to comply with his specific responsibilities which
give rise to his status as a fiduciary, he has enabled the other
fiduciary to commit a breach; or
o If he has knowledge of a breach by a co-fiduciary, unless he makes
reasonable efforts under the circumstances to remedy the breach.
9.10 Expenses of Administration
The Employer does not and will not guarantee the Plan assets against
loss. The Employer may in its sole discretion, but will not be
obligated to, pay the ordinary expenses of establishing the Plan,
including the fees of consultants, accountants and attorneys in
connection therewith. The Employer may, in its sole discretion (but
will not be obligated to), pay other costs and expenses of administering
the Plan, the taxes imposed upon the Plan, if any, and the fees, charges
or commissions with respect to the purchase and sale of Plan assets.
Unless paid by the Employer, such costs and expenses, taxes (if any),
and fees, charges and commissions will be a charge upon Plan assets and
deducted by the Trustee.
9.11 Distribution Authority
If any person entitled to receive payment under this Plan is a minor,
declared incompetent or is under other legal disability, the Plan
Administrator may, in its sole discretion, direct the Trustee to:
o Distribute directly to the person entitled to the payment;
o Distribute to the legal guardian or, if none, to a parent of the
person entitled to payment or to a responsible adult with whom the
person entitled to payment maintains his residence;
o Distribute to a custodian for the person entitled to payment under
the Uniform Gifts to Minors Act if permitted by the laws of the
state in which the person entitled to payment resides; or
o Withhold distribution of the amount payable until a court of
competent jurisdiction determines the rights of the parties thereto
or appoints a guardian of the estate of the person entitled to
payment.
If there is any dispute, controversy or disagreement between any
Beneficiary or person and any other person as to who is entitled to
receive the benefits payable under this Plan, or if the Plan
Administrator is uncertain as to who is entitled to receive benefits, or
if the Plan Administrator is unable to locate the person who is entitled
9-4
to benefits, the Plan Administrator may with acquittance interplead the
funds into a court of competent jurisdiction in the judicial district in
which the Employer maintains its principal place of business and, upon
depositing the funds with the clerk of the court, be released from any
further responsibility for the payment of the benefits. If it is
necessary for the Plan Administrator to retain legal counsel or incur
any expense in determining who is entitled to receive the benefits,
whether or not it is necessary to institute court action, the Plan
Administrator will be entitled to reimbursement from the benefits for
the amount of its reasonable costs, expenses and attorneys' fees
incurred.
9-5
ARTICLE 10
AMENDMENT OR TERMINATION OF PLAN
10.01 Right of Plan Sponsor to Amend or Terminate
The Plan Sponsor reserves the right to alter, amend, revoke or
terminate this Plan. No amendment will deprive any Participant or
Beneficiary of any vested right nor will it reduce the present value
(determined upon an actuarial equivalent basis) of any Accrued Benefit
to which he is then entitled with respect to Employer contributions
previously made, except as may be required to maintain the Plan as a
qualified plan under the Code. No amendment will change the duties or
responsibilities of the Trustee without its express written consent
thereto.
A plan amendment which has the effect of (a) eliminating or reducing an
early retirement benefit or a retirement-type subsidy, or (b)
eliminating an optional benefit form, will, with respect to benefits
attributable to service before the amendment be treated as reducing
Accrued Benefits. In the case of a retirement-type subsidy, the
preceding sentence will apply only with respect to a Participant who
satisfies (either before or after the amendment) the preamendment
conditions for the subsidy. In general, a retirement-type subsidy is a
subsidy that continues after retirement but does not include a
disability retirement benefit, a medical benefit, a social security
supplement, a pre-retirement death benefit, or a plant shutdown benefit
(that does not continue after retirement).
A minimum Accrued Benefit value will apply if this Plan is or becomes a
successor to a profit sharing plan, a defined contribution pension
plan, a target benefit plan, or a defined benefit pension plan which
was fully insured, or any plan under which the accrued benefit of a
Participant was determined as a lump sum or account balance. The
actuarial equivalent value of a Participant's Accrued Benefit will not
be less than the actuarial equivalent value of his Accrued Benefit on
the Effective Date of the Plan.
10.02 Allocation of Assets Upon Termination of Plan
If this Plan is revoked or terminated (in whole or in part) or if
contributions are completely discontinued the Accounts of all affected
Participants will become non-forfeitable. The Employer will then
arrange for allocation of all assets among Participants so affected by
the total or partial termination in accordance with the requirements of
all applicable law and the regulations and requirements of the Internal
Revenue Service. All allocated amounts will be retained in the Plan to
the credit of the individual Participants until distribution as
directed by the Employer. Distribution to Participants may be in the
form of cash or other Plan assets or partly in each.
10.03 Exclusive Benefit
At no time will any part of the principal or income of the Plan assets
be used or diverted for purposes other than the exclusive benefit of
Participants in the Plan and their Beneficiaries, nor may any portion
10-1
of the Plan assets revert to the Employer except as provided in
Sections 7.01(e) and 8.08.
10.04 Failure to Qualify
Notwithstanding any of the foregoing provisions, if this Plan, upon
adoption by the Employer, is submitted to the Internal Revenue Service
which then determines that the Plan as initially adopted by the
Employer is not a qualified plan under the Code, the Employer may elect
to terminate this Plan by giving written notice thereof. Such
termination will have the same effect as if the Plan were never
adopted, all policies and contracts will be cancelled, and all
contributions, to the extent recoverable from the Trustee, will be
returned to their source. If any amendment to this Plan is submitted
to the Internal Revenue Service within the period allowed under Code
Section 401(b) which then determines that the Plan as amended is not a
qualified plan under the Code, the Employer may cancel or modify any or
all provisions of the amendment retroactive to the effective date of
the amendment in order to maintain the qualified status of the Plan,
whereupon written notice thereof will be furnished to all affected
Employees, Participants and Beneficiaries.
10.05 Mergers, Consolidations or Transfers of Plan Assets
In the event this Plan is merged or consolidated with another plan
which is qualified under Code Sections 401(a) (and 501(a) if
applicable), or in the event of a transfer of the assets or liabilities
of this Plan to another plan which is qualified under Code Sections
401(a) (and 501(a) if applicable), the benefit which each Participant
would be entitled to receive under the successor plan or other plan if
it were terminated immediately after the merger, consolidation or
transfer will be equal to or greater than the benefit which the
Participant would have received immediately before the merger,
consolidation or transfer if this Plan had then terminated.
Any transfer of assets and/or liabilities to (or from) this Plan from
(or to) another plan qualified under Code Sections 401(a) (and 501(a)
if applicable) will be evidenced by a Written Resolution by the Plan
Sponsor of each affected plan which specifically authorizes such
transfer of assets and/or liabilities.
Any transfer of assets to this Plan will be allowed under the
provisions of this Section if such transferred assets are not required
to be paid in the form of a qualified joint & survivor annuity or a
qualified survivor annuity in accordance with Code Section 401(a)(11).
10.06 Effect of Plan Amendment on Vesting Schedule
No amendment to the Vesting Schedule will deprive a Participant of his
nonforfeitable right to his Vested Accrued Benefit as of the date of
the amendment. Further, if the Vesting Schedule of the Plan is
amended, or if the Plan is amended in any way that directly or
indirectly affects the computation of a Participant's non-forfeitable
percentage, each Participant with at least 3 Years of Vesting Service
as of the last day of the election period described below may elect,
within a reasonable period after the adoption of the amendment, to have
his Vested Percentage computed under the Plan without regard to such
10-2
amendment. The period during which such election may be made will
commence with the date the amendment is adopted and will end 60 days
after the latest of:
(a) the date the amendment is adopted;
(b) the date the amendment becomes effective; or
(c) the date the Participant is issued written notice of the amendment
by the Employer.
10-3
ARTICLE 11
TRUSTEE AND TRUST FUND
11.01 Acceptance of Trust
The Trustee, by signing this Agreement, accepts this Trust and agrees
to perform the duties of the Trustee in accordance with the terms and
conditions set forth herein.
11.02 Trust Fund
(a) Purpose and Nature
The Trustee will establish and maintain a Trust Fund for purposes
of providing a means of accumulating the assets necessary to
provide the benefits which become payable under the Plan. The
Trustee will receive, hold and invest all contributions made by the
Employer, any Participating Employers, and the Participants,
including the investment earnings thereon. The Trust Fund arising
from such contributions and earnings will consist of all assets
held by the Trustee under the Plan and Trust. All benefits payable
under the Plan will be paid by the Trustee from the Trust Fund.
Any person having any claim under the Plan will look solely to the
assets of the Trust Fund for satisfaction. In no event will the
Plan Administrator, the Employer, any Employees, any officer of the
Employer or any agents of the Employer or the Plan Administrator be
liable in their individual capacities to any person whomsoever,
under the provisions of this Plan and Trust, except as provided by
law.
The Trust Fund will be used and applied only in accordance with the
provisions of the Plan and Trust, to provide the benefits thereof,
and no part of the corpus or income of the Trust Fund will be used
for, or diverted to, purposes other than for the exclusive benefit
of the Participants or their Beneficiaries entitled to benefits
under the Plan, except to the extent specifically provided
elsewhere herein.
(b) Investments
The Trustee will invest the Trust Fund in accordance with the
proper directions of the Plan Administrator or Investment Manager.
(c) Investment Policy
The Plan Sponsor (or the Plan Administrator or an Investment
Committee appointed by the Plan Sponsor) will have the right to
periodically provide the Trustee with a written investment policy
which, in consideration of the needs of the Plan, sets forth the
investment objectives, policies, and guidelines which the Plan
Sponsor judges to be appropriate and prudent.
(d) Operation of Trust Fund
The Trust Fund will be maintained in accordance with the accounting
requirements of the Plan. No Participant will have any right to
11-1
any specific asset or any specific portion of the Trust Fund prior
to distribution of benefits. Withdrawals from the Trust Fund will
be made to provide benefits to Participants and Beneficiaries in
the amounts specified by the Plan, and to pay expenses authorized
by the Plan Administrator.
(e) Plan Sponsor Direction of Investment
The Plan Sponsor will have the right to direct the Trustee with
respect to the investment and reinvestment of assets comprising the
Trust Fund. The Trustee and the Plan Sponsor (or the Plan
Administrator or an Investment Committee appointed by the Plan
Sponsor) will execute a letter of agreement as a part of this Plan
containing such conditions, limitations and other provisions they
deem appropriate before the Trustee will follow any Plan Sponsor
direction with respect to the investment or reinvestment of any
part of the Trust Fund.
11.03 Receipt of Contributions
The Trustee will be accountable to the Employer for the funds
contributed to it, but will have no duty to see that the contributions
received comply with the provisions of the Plan. The Trustee will not
be obligated to collect any contributions from the Employer or the
Participants.
11.04 Powers of the Trustee
Subject to the provisions and limitations contained elsewhere in this
Plan, the Trustee will have full discretion and authority with regard
to the investment of the Trust Fund; provided, however, that the
Trustee's authority and discretion with respect to the Trust Fund shall
at all times be subject to the proper written directions of the Plan
Administrator or Investment Manager. The Trustee is authorized and
empowered, but not by way of limitation, with the following powers,
rights and duties:
(a) To invest any part or all of the Trust Fund in any common or
preferred stocks, open-end or closed-end mutual funds, United
States retirement plan bonds, corporate bonds, debentures,
convertible debentures, commercial paper, U.S. Treasury bills,
book entry deposits with the United States Federal Reserve Bank or
System, Master Notes or similar arrangements sponsored by the
Trustee or any other financial institution as permitted by law,
improved or unimproved real estate situated in the United States,
mortgages, notes or other property of any kind, real or personal,
as a prudent man would so invest under like circumstances with due
regard for the purposes of this Plan;
(b) To maintain any part of the assets of the Trust Fund in cash, or in
demand or short-term time deposits bearing a reasonable rate of
interest (including demand or short-term time deposits of or with
the Trustee), or in a short-term investment fund or in other cash
equivalents having ready marketability, including, but not limited
to, U.S. Treasury Bills, commercial paper, certificates of deposit
(including such certificates of deposit of or with the Trustee),
and similar types of short-term securities, as may be deemed
11-2
necessary by the Trustee in its sole discretion;
(c) To manage, sell, contract to sell, grant options to purchase,
convey, exchange, transfer, abandon, improve, repair, insure, lease
for any term even though commencing in the future or extending
beyond the term of the Trust, and otherwise deal with all property,
real or personal, in such manner, for such considerations and on
such terms and conditions as the Trustee will decide;
(d) To credit and distribute the Trust as directed by the Plan
Administrator or any agent of the Plan Administrator. The Trustee
will not be obliged to inquire as to whether any payee or
distributee is entitled to any payment or whether the distribution
is proper or within the terms of the Plan, or as to the manner of
making any payment or distribution. The Trustee will be
accountable only to the Plan Administrator for any payment or
distribution made by it in good faith on the order or direction of
the Plan Administrator or any agent of the Plan Administrator;
(e) To borrow money, assume indebtedness, extend mortgages and encumber
by mortgage or pledge;
(f) To compromise, contest, arbitrate, or abandon claims and demands,
in its discretion;
(g) To have with respect to the Trust all of the rights of an
individual owner, including the power to give proxies, to
participate in any voting trusts, mergers, consolidations or
liquidations, and to exercise or sell stock subscriptions or
conversion rights;
(h) To hold any securities or other property in the name of the Trustee
or its nominee, or in another form as it may deem best, with or
without disclosing the trust relationship;
(i) To perform any and all other acts in its judgment necessary or
appropriate for the proper and advantageous management, investment
and distribution of the Trust;
(j) To retain any funds or property subject to any dispute without
liability for the payment of interest, and to decline to make
payment or delivery of the funds or property until final
adjudication is made by a court of competent jurisdiction;
(k) To file all tax forms or returns required of the Trustee;
(l) To begin, maintain or defend any litigation necessary in connection
with the administration of the Plan, except that the Trustee will
not be obligated to or required to do so unless indemnified to its
satisfaction; and
(m) To keep any or all of the Trust property at any place or places
within the United States or abroad, or with a depository or
custodian at such place or places; provided, however, that the
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Trustee may not maintain the indicia of ownership of any assets of
the Plan outside the jurisdiction of the District Courts of the
United States, except as may be expressly authorized in U.S.
Treasury or U.S. Department of Labor regulations.
11.05 Investment in Common or Collective Trust Funds
Notwithstanding the provisions of Section 11.04, the Plan Sponsor
specifically authorizes the Trustee to invest all or any portion of the
assets comprising the Trust Fund in any common or collective trust fund
which at the time of the investment provides for the pooling of the
assets of plans qualified under Code Section 401(a). The authorization
applies only if such common or collective trust fund: (a) is exempt
from taxation under Code Section 584 or 501(a); (b) if exempt under
Code Section 501(a), expressly limits participation to pension and
profit sharing trusts which are exempt under Code Section 501(a) by
reason of qualifying under Code Section 401(a); (c) prohibits that part
of its corpus or income which equitably belongs to any participating
trust from being used for or diverted to any purposes other than for
the exclusive benefit of the Employees or their Beneficiaries who are
entitled to benefits under such participating trust; (d) prohibits
assignment by participating trust of any part of its equity or interest
in the group trust; and (e) the sponsor of the group trust created or
organized the group trust in the United States and maintains the group
trust at all times as a domestic trust in the United States. The
provisions of the common or collective trust fund agreement, as amended
by the Trustee from time to time, are by this reference incorporated
within this Plan and Trust. The provisions of the common or collective
trust fund will govern any investment of Plan assets in that fund.
This provision constitutes the express permission required by Section
408(b)(8) of ERISA.
11.06 Investment in Insurance Company Contracts
The Trustee may invest any portion of the Trust Fund in a deposit
administration, guaranteed investment or similar type of investment
contract (hereinafter referred to as Contract); provided, however, that
no such Contract may provide for an optional form of benefit which
would not be provided for under the provisions hereof. The Trustee
will be the complete and absolute owner of Contracts held in the Trust
Fund.
The Trustee may convert from one form to another any Contract held in
the Trust Fund; designate any mode of settlement; sell or assign any
Contract held in the Trust Fund; surrender for cash any Contract held
in the Trust Fund; agree with the insurance company issuing any
Contract to any release, reduction, modification or amendment thereof;
and, without limitation of any of the foregoing, exercise any and all
of the rights, options and privileges that belong to the absolute owner
of any Contract held in the Trust Fund that are granted by the terms of
any such Contract or by the terms of this Agreement.
The Trustee will hold in the Trust Fund the proceeds of any sale,
assignment or surrender of any Contract held in the Trust Fund and any
and all dividends and other payments of any kind received in respect to
any Contract held in the Trust Fund.
11-4
No insurance company which may issue any Contract based upon the
application of the Trustee will be responsible for the validity of this
Plan, be required to look into the terms of this Plan, be required to
question any act of the Plan Administrator or the Trustee hereunder or
be required to verify that any action of the Trustee is authorized by
this Plan. If a conflict should arise between the terms of the Plan
and any such Contract, the terms of the Plan will govern.
11.07 Fees and Expenses from Fund
The Trustee will be entitled to receive reasonable annual compensation
as may be mutually agreed upon from time to time between the Plan
Sponsor and the Trustee. The Trustee will pay all expenses reasonably
incurred by it in its administration and investment of the Trust Fund
from the Trust Fund unless the Plan Sponsor pays the expenses. No
person who is receiving full pay from the Plan Sponsor will receive
compensation for services as Trustee.
11.08 Records and Accounting
The Trustee will keep full and complete records of the administration
of the Trust Fund which the Employer and the Plan Administrator may
examine at any reasonable time. As soon as practical after the end of
each Plan Year and at such other reasonable times as the Employer may
direct, the Trustee will prepare and deliver to the Employer and the
Plan Administrator an accounting of the administration of the Trust,
including a report on the valuation of all assets of the Trust Fund,
such valuation to be based upon the fair market value on the valuation
date.
11.09 Distribution Directions
If no one claims a payment or distribution made from the Trust, the
Trustee will notify the Plan Administrator and will dispose of the
payment in accordance with the subsequent direction of the Plan
Administrator.
11.10 Third Party
No person dealing with the Trustee will be obliged to see to the proper
application of any money paid or property delivered to the Trustee, or
to inquire whether the Trustee has acted pursuant to any of the terms
of the Plan. Each person dealing with the Trustee may act upon any
notice, request or representation in writing by the Trustee, or by the
Trustee's duly authorized agent, and will not be liable to any person
whomsoever in so doing. The certification of the Trustee that it is
acting in accordance with the Plan will be conclusive in favor of any
person relying on the certification.
11.11 Professional Agents
The Trustee may employ and pay from the Trust Fund reasonable
compensation to agents, attorneys, accountants and other persons to
advise the Trustee as in its opinion may be necessary. The Trustee may
delegate to any agent, attorney, accountant or other person selected by
it any non-Trustee power or duty vested in it by the Plan; the Trustee
may act or refrain from acting on the advice or opinion of any agent,
attorney, accountant or other person so selected.
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11.12 Valuation of Trust
The Trustee will value the Trust Fund as of the last day of each Plan
Year to determine the fair market value of the Trust, and the Trustee
will value the Trust Fund on such other date(s) as may be necessary to
carry out the provisions of the Plan.
11.13 Liability of Trustee
The Trustee shall discharge its duties under the Plan solely in the
interests of Plan Participants and their Beneficiaries and for the
exclusive purpose of providing benefits to Plan Participants and their
Beneficiaries and defraying reasonable expenses of administering the
Trust Fund. The Trustee shall discharge its duties hereunder with the
care, skill, prudence and diligence under the circumstances then
prevailing that a prudent man acting in like capacity and familiar with
such matters would use in the conduct of an enterprise of a like
character and with like aims. The duties of the Trustee shall be
limited to the assets held in the Trust Fund, and the Trustee shall
have no duties with respect to assets held by any other person
including, without limitation, any other trustee for the Plan. The
duties of the Trustee are subject to and limited by the second
paragraph of Section 9.09.
The Plan Sponsor agrees to hold the Trustee harmless from and against
any liability that the Trustee may incur in the administration of the
Trust Fund including, without limitation, liability for legal and other
professional fees, unless arising from the Trustee's own negligence or
misconduct, or except as may be prohibited by ERISA.
The Trustee will be liable only for the safeguarding and administration
of the assets of this Trust Fund in accordance with the provisions
hereof and any amendments hereto and no other duties or
responsibilities will be implied. The Trustee will not be required to
pay any interest on funds paid to or deposited with it or to its credit
under the provisions of this Trust, unless pursuant to a written
agreement between the Employer and the Trustee. The Trustee will not
be responsible for the adequacy of the Trust Fund to meet and discharge
any liabilities under the Plan and will not be required to make any
payment of any nature except from funds actually received as Trustee.
The Trustee may consult with legal counsel (who may be legal counsel
for the Employer) selected by the Trustee and will be fully protected
for any action taken, suffered or omitted in good faith in accordance
with the opinion of said legal counsel. It will not be the duty of the
Trustee to determine the identity or mailing address of any Participant
or any other person entitled to benefits hereunder, such identity and
mailing addresses to be furnished by the Employer, the Plan
Administrator or an agent of the Plan Administrator. The Trustee will
be under no liability in making payments in accordance with the terms
of this Plan and the certification of the Plan Administrator or an
agent of the Plan Administrator who has been granted such powers by the
Plan Administrator.
Except to the extent required by any applicable law, no bond or other
security for the faithful performance of duty hereunder will be
11-6
required of the Trustee.
11.14 Removal or Resignation and Successor Trustee
A Trustee may resign at any time upon giving 30 days prior written
notice to the Plan Sponsor or, with the consent of the Plan Sponsor, a
Trustee may resign with less than 30 days prior written notice.
The Plan Sponsor may remove a Trustee by giving at least 30 days prior
written notice to the Trustee.
Upon the removal or resignation of a Trustee, the Plan Sponsor will
appoint and designate a successor Trustee which will be one or more
individual successor Trustees or a corporate Trustee organized under
the laws of the United Sates or of any state thereof with authority to
accept and execute trusts. Any successor Trustee must accept and
acknowledge in writing its appointment as a successor Trustee before it
can act in such capacity.
Title to all property and records or true copies of such records
necessary to the current operation of the Trust Fund held by the
Trustee hereunder will vest in any successor Trustee acting pursuant to
the provisions hereof, without the execution or filing of any further
instrument. Any resigning or removed Trustee will execute all
instruments and do all acts necessary to vest such title in any
successor Trustee of record. Each successor Trustee will have,
exercise and enjoy all the powers, both discretionary and ministerial,
herein conferred upon his predecessor. No successor Trustee will be
obligated to examine the accounts, records and acts of any previous
Trustee or Trustees, and each successor Trustee in no way or manner
will be responsible for any action or omission to act on the part of
any previous Trustee.
Any corporation which results from any merger, consolidation or
purchase to which the Trustee may be a party, or which succeeds to the
trust business of the Trustee, or to which substantially all the trust
assets of the Trustee may be transferred, will be the successor to the
Trustee hereunder without any further act or formality with like effect
as if the successor Trustee had originally been named Trustee herein;
and in any such event it will not be necessary for the Trustee or any
successor Trustee to give notice thereof to any person, and any
requirement, statutory or otherwise, that notice will be given is
hereby waived.
11.15 Appointment of Investment Manager
One or more Investment Managers may be appointed by the Plan Sponsor
(or the Plan Administrator) to exercise full investment management
authority with respect to all or a portion of the Trust assets.
Authorized payment of the fees and expenses of the Investment
Manager(s) may be made from the Trust assets. For purposes of this
agreement, any Investment Manager so appointed will, during the period
of his appointment, possess fully and absolutely those powers, rights
and duties of the Trustee (to the extent delegated by the Plan Sponsor
or the Plan Administrator) with respect to the investment or
reinvestment of that portion of the Trust assets over which the
11-7
Investment Manager has investment management authority. The Investment
Manager must be one of the following:
(a) Registered as an investment advisor under the Investment Advisors
Act of 1940;
(b) A bank, as defined in the Investment Advisors Act of 1940; or
(c) An insurance company qualified to manage, acquire, or dispose of
such Plan assets under the laws of more than one state.
Any Investment Manager will acknowledge in writing to the Plan Sponsor
or the Plan Administrator and to the Trustee that he or it is a
fiduciary with respect to the Plan. During any period of time when the
Investment Manager is so appointed and serving, and with respect to
those assets in the Plan over which the Investment Manager exercises
investment management authority, the Trustee's responsibility will be
limited to holding such assets as a custodian, providing accounting
services, disbursing benefits as authorized, and executing such
investment instructions only as directed by the Investment Manager.
The Trustee will not be responsible for any acts or omissions of the
Investment Manager. Any certificates or other instruments duly signed
by the Investment Manager (or the authorized representative of the
Investment Manager), purporting to evidence any instruction, direction
or order of the Investment Manager with respect to the investment of
those assets of the Plan over which the Investment Manager has
investment management authority, will be accepted by the Trustee as
conclusive proof thereof. The Trustee will also be fully protected in
acting in good faith upon any notice, instruction, direction, order,
certificate, opinion, letter, telegram or other document believed by
the Trustee to be genuine and from the Investment Manager (or the
authorized representative of the Investment Manager). The Trustee will
not be liable for any action taken or omitted by the Investment Manager
or for any mistakes of judgment or other action made, taken or omitted
by the Trustee in good faith upon direction of the Investment Manager.
11.16 Loans to Participants
The Plan Administrator may authorize the Trustee to lend on a
nondiscriminatory basis to a Participant an amount from the Plan as
specified herein; provided, a reasonable rate of interest will be
charged on the loan, the loan will be secured by the Participant's
Vested Accrued Benefit in the Plan, and provision for repayment will be
made. All loans will be subject to the approval of the Plan
Administrator which will investigate each application for a loan. The
Plan Administrator will prescribe such rules as may be necessary to
provide guidelines as to under which circumstances and for what purpose
loans will be permitted.
The Plan Administrator will prescribe guidelines as to which Account or
Accounts loans may be made from. Each loan made to a Participant will
be made from the Participant's allowable Account or Accounts. All
interest and principal repayments will be credited to the Participant's
Account from which the loan was made.
11-8
In addition to any additional rules and regulations as the Plan
Administrator may adopt all loans will comply with the following terms
and conditions:
(a) Only Active and Inactive Participants will be eligible to apply for
a loan. Each application for a loan will be made in writing to the
Plan Administrator, whose action thereon will be final.
(b) Each loan will be made against collateral being the assignment of
the borrower's entire right, title and interest in and to the Trust
Fund, supported by the borrower's promissory note for the amount of
the loan, including interest payable to the order to the Trustee,
and any additional security deemed necessary to adequately secure
the Loan. If a person fails to make a required payment within 90
days of the due date set forth in the loan agreement, the loan will
be in default. There will be no foreclosure against a
Participant's Accrued Benefit prior to his becoming entitled to a
distribution of benefits in accordance with the terms of this
Plan. All loans will become due and payable in full upon the
termination of a Participant's employment. If a Participant with
an outstanding loan terminates employment and becomes entitled to a
distribution of benefits from the Plan, then the outstanding
balance of the unpaid loan plus any accrued interest thereon will
be deducted from the amount of otherwise distributable benefits and
the Participant's promissory note will be distributed to the
Participant.
(c) The principal repayment will be amortized over the fixed life of a
loan with installments of principal and interest to be paid not
less often than quarterly. The period of repayment for each loan
will be arrived at by mutual agreement between the Plan
Administrator and the borrower, but in no event will such period
exceed a reasonable period of time. The period of repayment will
in no event exceed 5 years unless the loan is to be used to
acquire, construct, reconstruct or substantially rehabilitate any
dwelling unit which, within a reasonable period of time, is to be
used as a principal residence of the Participant or a member of the
family (spouse, brother, sister, ancestor, or lineal descendants)
of the Participant.
(d) The minimum amount of any loan is equal to $1,000.
(e) The maximum amount of any loan is such that when the amount of the
loan is added to the outstanding balance of all other loans made to
the Participant from the Plan (and any other plans maintained by
the Employer or any Related Employer) the total does not exceed the
lesser of:
(1) 50% of the Participant's Vested Accrued Benefit; or
(2) $50,000, reduced by the amount, if any, of the highest balance
of all outstanding loans to the Participant during the one-year
period ending on the day prior to the day on which the loan in
question is made.
11-9
(f) Each loan will bear interest at a rate equal to the prime rate
which is published in the Wall Street Journal as being
representative of the base rate on corporate loans at large U.S.
money center commercial banks on the date on which the loan is
made, plus 2 percentage points.
(g) A Participant may have only one loan outstanding at any time and
may make a new loan no more frequently than once per year.
(h) Each loan will require the Participant (and, if the Participant is
married, the Participant's spouse) to consent to the loan and the
possible reduction in the Participant's Accrued Benefit. Such
consent must be made in writing within the 90-day period before the
making of the loan.
(i) No loan will be permitted to a Participant in a year in which he is
either an Owner-Employee or Shareholder-Employee as defined in Code
Section 4975(d).
11-10
IN WITNESS WHEREOF, this instrument has been executed by the duly authorized
and empowered officers of the Employer, this 1st day of January, 1994.
Triton Energy Corporation
By: // Robert B. Holland, III
___________________________
Robert B. Holland, III
Sr. Vice President, General Counsel
and Secretary
The Trustee agrees to serve as Trustee under the terms of this instrument.
SBS Trust Company
By:_________________________
EXHIBIT 15.1
January 10, 1994
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D. C. 20549
Dear Sirs:
We are aware that Triton Energy Corporation has
included our report dated January 10, 1994 (issued
pursuant to the provisions of Statement on Auditing
Standards No. 71) in the Registration Statements on
Form S-3 (Nos. 33-11920, 33-15793, 33-17614, 33-21984,
33-23058, 33-25634, 33-31319, 33-45847, 33-46292) and
Form S-8 (Nos. 2-80978, 33-4042, 33-27203, 33-29498,
33-46968, 33-51691 and 33-69230). We are also aware of
our responsibilities under the Securities Act of 1933.
Yours very truly,
\\ Price Waterhouse
PRICE WATERHOUSE
