EXHIBIT 4.1
________________________________________________________________________________
ASSISTED LIVING CONCEPTS, INC.
INDENTURE
Dated as of October 2, 1997
XXXXXX TRUST AND SAVINGS BANK,
AS TRUSTEE
Providing for Issuance of Securities in Series
_________________________________________
TABLE OF CONTENTS
Page
----
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01 Definitions................................................. 1
SECTION 1.02 Other Definitions........................................... 5
SECTION 1.03 Incorporation by Reference to Trust
Indenture Act.............................................. 6
SECTION 1.04 Rules of Construction....................................... 6
ARTICLE 2
THE SECURITIES
SECTION 2.01 Forms Generally............................................. 6
SECTION 2.02 Amount Unlimited; Issuable in Series........................ 6
SECTION 2.03 Execution and Authentication................................ 9
SECTION 2.04 Registrar and Agents........................................ 10
SECTION 2.05 Paying Agent to Hold Money in Trust......................... 10
SECTION 2.06 Transfer and Exchange....................................... 11
SECTION 2.07 Replacement Securities...................................... 14
SECTION 2.08 Outstanding Securities...................................... 14
SECTION 2.09 Temporary Securities........................................ 15
SECTION 2.10 Cancellation................................................ 15
SECTION 2.11 Defaulted Interest.......................................... 15
SECTION 2.12 Securityholder Lists........................................ 16
SECTION 2.13 Persons Deemed Owners....................................... 16
SECTION 2.14 CUSIP Number................................................ 16
SECTION 2.15 Provisions in Global Security............................... 17
ARTICLE 3
REDEMPTION
SECTION 3.01 Right of Redemption......................................... 18
SECTION 3.02 Selection of Securities to be Redeemed...................... 19
SECTION 3.03 Notice of Redemption by the Company......................... 20
SECTION 3.04 Effect of Notice of Redemption.............................. 20
SECTION 3.05 Deposit of Redemption Price................................. 21
SECTION 3.06 Securities Redeemed in Part................................. 21
ARTICLE 4
COVENANTS
SECTION 4.01 Payment of the Securities................................... 21
SECTION 4.02 Commission Reports.......................................... 21
SECTION 4.03 Waiver of Stay, Extension or Usury Laws..................... 22
SECTION 4.04 Notice of Default........................................... 22
SECTION 4.05 Compliance Certificates..................................... 22
SECTION 4.06 Limitation on Dividends and Other
Distributions.............................................. 23
ARTICLE 5
SUCCESSOR CORPORATION
SECTION 5.01 When Company May Merge, etc................................. 23
SECTION 5.02 Successor Corporation or Trust Substituted.................. 24
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01 Events of Default........................................... 24
SECTION 6.02 Acceleration................................................ 26
SECTION 6.03 Other Remedies.............................................. 27
SECTION 6.04 Waiver of Defaults and Events of Default.................... 27
SECTION 6.05 Control by Majority......................................... 27
SECTION 6.06 Rights of Holders to Receive Payment........................ 27
SECTION 6.07 Collection Suit by Trustee.................................. 28
SECTION 6.08 Trustee May File Proofs of Claim............................ 28
SECTION 6.09 Priorities.................................................. 29
SECTION 6.10 Undertaking for Costs....................................... 29
SECTION 6.11 Limitations on Suits........................................ 30
ARTICLE 7
TRUSTEE
SECTION 7.01 Duties of Trustee........................................... 30
SECTION 7.02 Rights of Trustee........................................... 32
SECTION 7.03 Individual Rights of Trustee................................ 32
SECTION 7.04 Trustee's Disclaimer........................................ 33
SECTION 7.05 Notice of Defaults.......................................... 33
SECTION 7.06 Reports by Trustee to Holders............................... 33
SECTION 7.07 Compensation and Indemnity.................................. 34
SECTION 7.08 Replacement of Trustee...................................... 34
SECTION 7.09 Successor Trustee by Merger, etc............................ 36
SECTION 7.10 Eligibility; Disqualification............................... 36
SECTION 7.11 Preferential Collection of Claims Against
Company.................................................... 36
ARTICLE 8
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 8.01 Satisfaction, Discharge and Defeasance of the
Securities.................................................. 36
SECTION 8.02 Satisfaction and Discharge of Indenture..................... 37
SECTION 8.03 Survival of Certain Obligations............................. 38
SECTION 8.04 Application of Trust Money.................................. 38
SECTION 8.05 Paying Agent to Repay Monies Held........................... 39
SECTION 8.06 Return of Unclaimed Monies.................................. 39
SECTION 8.07 Reinstatement............................................... 39
-2-
ARTICLE 9
SUPPLEMENTAL INDENTURES
SECTION 9.01 Supplemental Indentures Without Consent of
Holders..................................................... 40
SECTION 9.02 Supplemental Indentures with Consent of Holders............. 41
SECTION 9.03 Compliance with Trust Indenture Act......................... 42
SECTION 9.04 Revocation and Effect of Consents........................... 42
SECTION 9.05 Notation on or Exchange of Securities....................... 43
SECTION 9.06 Effect of Supplemental Indentures........................... 43
SECTION 9.07 Reference in Securities to Supplemental
Indentures................................................. 43
ARTICLE 10
CONVERSION OF SECURITIES
SECTION 10.01 Right of Conversion; Conversion Price....................... 44
SECTION 10.02 Issuance of Shares on Conversion............................ 45
SECTION 10.03 No Adjustment for Interest or Dividends..................... 46
SECTION 10.04 Adjustment of Conversion Price.............................. 46
SECTION 10.05 Notice of Adjustment of Conversion Price.................... 49
SECTION 10.06 Notice of Certain Corporate Action.......................... 50
SECTION 10.07 Taxes on Conversions........................................ 51
SECTION 10.08 Fractional Shares........................................... 51
SECTION 10.09 Cancellation of Converted Securities........................ 51
SECTION 10.10 Provisions in Case of Consolidation, Merger
or Sale of Assets.......................................... 52
SECTION 10.11 Disclaimer by Trustee of Responsibility for
Certain Matters............................................ 52
SECTION 10.12 Covenant to Reserve Shares.................................. 53
ARTICLE 11
SUBORDINATION; SENIORITY
SECTION 11.01 Securities Subordinated to Senior Indebtedness.............. 54
SECTION 11.02 Company Not to Make Payments with Respect to
Junior Securities in Certain Circumstances................. 55
SECTION 11.03 Subrogation of Junior Securities............................ 57
SECTION 11.04 Authorization by Holders of Junior Securities............... 58
SECTION 11.05 Notices to Trustee.......................................... 59
SECTION 11.06 Trustee's Relation to Senior Indebtedness................... 60
SECTION 11.07 No Impairment of Subordination.............................. 60
SECTION 11.08 Article 11 Not To Prevent Events of Default................. 60
SECTION 11.09 Paying Agents other than the Trustee........................ 60
SECTION 11.10 Securities Senior to Subordinated
Indebtedness............................................... 61
-3-
ARTICLE 12
SINKING FUND
SECTION 12.01 Mandatory and Optional Sinking Fund Payments............... 61
SECTION 12.02 Satisfaction of Sinking Fund Payments with
Securities................................................ 61
SECTION 12.03 Redemption of Securities for Sinking Funds................. 62
ARTICLE 13
MISCELLANEOUS
SECTION 13.01 Trust Indenture Act Controls............................... 63
SECTION 13.02 Notices.................................................... 63
SECTION 13.03 Communications by Holders with Other Holders............... 64
SECTION 13.04 Certificate and Opinion as to Conditions
Precedent................................................. 64
SECTION 13.05 Statements Required in Certificate and Opinion............. 64
SECTION 13.06 Rules by Trustee and Agents................................ 65
SECTION 13.07 Record Date................................................ 65
SECTION 13.08 Legal Holidays............................................. 65
SECTION 13.09 Governing Law.............................................. 65
SECTION 13.10 No Adverse Interpretation of Other Agreements.............. 66
SECTION 13.11 No Recourse Against Others................................. 66
SECTION 13.12 Successors................................................. 66
SECTION 13.13 Multiple Counterparts...................................... 66
SECTION 13.14 Table of Contents, Headings, etc........................... 66
SECTION 13.15 Severability............................................... 66
-4-
CROSS-REFERENCE TABLE
ASSISTED LIVING CONCEPTS, INC.
Trust Indenture
Act Section Indenture
--------------- ---------
{310(a)(1) 7.10
(a)(2) 7.10
(a)(3) Not
Applicable
(a)(4) Not
Applicable
(b) 7.08; 7.10;
13.02
(c) Not
Applicable
{311(a) 7.11
(b) 7.11
(c) Not
Applicable
{312(a) 2.12
(b) 12.03
(c) 12.03
{313(a) 7.06
(b)(1) Not
Applicable
(b)(2) 7.06
(c) 7.06; 13.02
(d) 7.06
{314(a) 4.02; 13.02
(b) Not
Applicable
(c)(1) 12.04
(c)(2) 12.04
(c)(3) Not
Applicable
(d) Not
Applicable
(e) 12.05
(f) Not
Applicable
{315(a) 7.01(b)
(b) 7.05; 13.02
(c) 7.01(a)
(d) 7.01(c)
(e) 6.10
{316(a)(last sentence) 13.06
(a)(1)(A) 6.05
(a)(1)(B) 6.04
(a)(2) Not
Applicable
(b) 6.06
{317(a)(1) 6.07
(a)(2) 6.08
(b) 2.05
{318(a) 11.01
__________
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of the Indenture.
INDENTURE dated as of October 2, 1997 between Assisted Living
Concepts, Inc., a Nevada corporation ("Company"), and Xxxxxx Trust and Savings
Bank, an Illinois banking corporation ("Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance of its securities (hereinafter called the
"Securities") evidencing its unsecured indebtedness, to be issued in one or more
fully registered series.
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
To set forth or to provide for the establishment of the terms and
conditions upon which the Securities are and are to be authenticated, issued and
delivered, and in consideration of the premises and the purchase of Securities
by the Holders thereof, it is mutually covenanted and agreed as follows, for the
equal and proportionate benefit of all Holders of the Securities or of a series
thereof, as the case may be:
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01 Definitions.
-----------
"Affiliate" means any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company. For
the purposes of this definition, "control" (including, with correlative
meanings, the terms "controlled by" and "under common control with"), as used
with respect to any Person, shall mean the possession, directly or indirectly,
of the power to direct or cause the direction of the management or policies of
such Person, whether through the ownership of voting securities or by agreement
or otherwise.
"Agent" means any Registrar, Paying Agent, Conversion Agent, co-
registrar or agent for service of notices and demands.
"Bankruptcy Law" means Title 11 of the U.S. Code or any similar
Federal or State law for the relief of debtors.
"Board of Directors of the Company" means the Board of Directors of
the Company or any committee of the Board.
"Board Resolution" means a resolution certified by the Secretary or an
Assistant Secretary of the Company to have been duly adopted by the Board of
Directors of the Company and to be in
-1-
full force and effect on the date of such certification, and delivered to the
Trustee.
"Business Day" means a day that is not a Legal Holiday.
"Capital Stock" means any and all shares or other equivalents (however
designated) of capital stock, including all common stock and all preferred
stock.
"Closing Price" means with respect to the shares of common stock of
the Company on any day, (i) the last reported sales price regular way or, in
case no such reported sale takes place on such day, the average of the reported
closing bid and asked prices regular way, in either case on the New York Stock
Exchange, or (ii) if the shares of common stock are not listed or admitted to
trading on the New York Stock Exchange, the last reported sales price regular
way, or in case no such reported sale takes place on such day, the average of
the reported closing bid and asked prices regular way, on the principal national
securities exchange on which the shares of common stock are listed or admitted
to trading, or (iii) if the shares of common stock are not listed or admitted to
trading on any national securities exchange, the average of the closing bid and
asked prices as furnished by any New York Stock Exchange member firm selected
from time to time by the Company for that purpose.
"Code" means the Internal Revenue Code of 1986, as amended.
"Company" means the party named as such in this Indenture until a
successor replaces it pursuant to this Indenture and thereafter means the
successor.
"Corporate Trust Office" means the office of the Trustee at which at
any particular time its corporate trust business shall be principally
administered, which office at the date of execution of this Indenture is located
at 000 Xxxx Xxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxx, Xxxxxxxx.
"Custodian" means any receiver, trustee, liquidator or similar
official under any Bankruptcy Law.
"Default" means any event which is, or after notice or passage of time
or both would be, an Event of Default.
"Depositary" means, with respect to the Securities of any series
issued in whole or in part in the form of a Global Security, the Person
designated as Depositary by the Company pursuant to Section 2.02 until a
successor Depositary shall have become such pursuant to the applicable
procedures 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 Depositary with respect to the Securities of any such series,
"Depositary" shall mean the Depositary with respect to the Securities of that
series.
-2-
"Dollar" or "$" means the lawful money of the United States of
America.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Global Security" means a Security in the form prescribed in Section
2.15 evidencing all or part of a Securities, issued to the Depositary for such
series or its nominee, and registered in the name of such Depositary or nominee.
"Holder" or "Securityholder" means the Person in whose name a Security
is registered on the Registrar's books.
"Indebtedness," as applied to any Person, means, without duplication
(i) all indebtedness for borrowed money whether or not evidenced by a promissory
note, draft or similar instrument, (ii) that portion of obligations with respect
to leases that is properly classified as a liability on a balance sheet in
accordance with generally accepted accounting principles, (iii) notes payable
and drafts accepted representing extensions of credit, (iv) any balance owed for
all or any part of the deferred purchase price of property or services, which
purchase price is due more than six months from the date of incurrence of the
obligation in respect thereof (except any such balance that constitutes (a) a
trade payable or an accrued liability arising in the ordinary course of business
or (b) a trade draft or note payable issued in the ordinary course of business
in connection with the purchase of goods or services), if and to the extent such
debt would appear as a liability upon a balance sheet of such Person prepared in
accordance with generally accepted accounting principles, and (v) any deferral,
amendment, renewal, extension, supplement or refunding of any of the foregoing
indebtedness; provided, however, that, in computing the "Indebtedness" of any
-------- -------
Person, there shall be excluded any particular indebtedness if, upon or prior to
the maturity thereof and at the time of determination of such indebtedness,
there shall have been deposited with a depository in trust money (or evidences
of indebtedness if permitted by the instrument creating such indebtedness) in
the necessary amount to pay, redeem or satisfy such indebtedness as it becomes
due, and the amount so deposited shall not be included in any computation of the
assets of such Person.
"Indenture" means this Indenture as originally executed or, if amended
or supplemented as provided in Article 9, as amended or supplemented from time
to time.
"Officer" means the Chairman of the Board, the President, any Vice
President, the Treasurer, the Secretary or the Controller of the Company.
"Officers' Certificate" means a certificate signed by two Officers or
by an Officer and an Assistant Treasurer, Assistant Secretary or Assistant
Controller of the Company. See
-3-
Sections 13.04 and 13.05.
"Opinion of Counsel" means a written opinion from LathamE& Xxxxxxx or
any other legal counsel who is reasonably acceptable to the Trustee. The
counsel may be an employee of or counsel to the Company or the Trustee. See
Sections 13.04 and 13.05.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"Principal" of a Security means the principal of the Security plus,
when appropriate, the premium, if any, on the Security.
"Redemption Date" when used with respect to any Security to be
redeemed, means the date fixed for such redemption pursuant to this Indenture.
"Redemption Price", when used with respect to any Security to be
redeemed, means the price fixed for such redemption pursuant to this Indenture
as specified in such Security.
"Senior Indebtedness" means the principal, premium, if any, and unpaid
interest (including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Company whether or not a claim
for post-filing interest is allowed in such proceeding), fees, charges,
expenses, reimbursement and indemnification obligations, and all other amounts
payable under or in respect of Indebtedness of the Company for money borrowed,
whether any such Indebtedness exists as of the date of this Indenture or shall
hereafter be created, incurred, assumed or guaranteed.
"Subordinated Indebtedness" means the principal, premium, if any, and
interest on any Indebtedness of the Company which by its terms is expressly
subordinated in right of payment to the Securities.
"Subsidiary" means a corporation the majority of whose voting stock is
owned by the Company or a subsidiary of the Company. Voting stock is Capital
Stock having voting power under ordinary circumstances to elect directors.
"Trust Officer", when used with respect to the Trustee, means the
chairman or any vice-chairman of the board of directors, the chairman or any
vice-chairman of the executive committee of the board of directors, the chairman
of the trust committee, the president, any vice-president, the secretary, any
assistant secretary, the treasurer, any assistant treasurer, the cashier, any
assistant cashier, any Trust Officer or assistant Trust Officer, the controller
or any assistant controller or any other officer of the Trustee customarily
performing functions similar to
-4-
those performed by any of the above designated officers and also means, with
respect to a particular corporate trust matter, any other officer of the Trustee
to whom such matter is referred because of his knowledge of and familiarity with
the particular subject.
"United States" means the United States of America.
SECTION 1.02 Other Definitions.
-----------------
Term Defined in Section
---- ------------------
"Company Order" 2.03
"Conversion Agent" 2.04
"conversion price" 10.01
"current market price" 10.04
"Event of Default" 6.01
"Junior Securities" 11.01
"Legal Holiday" 13.08
"mandatory sinking fund payments" 12.01
"Market Price" 3.01
"optional sinking fund payments" 12.01
"Paying Agent" 2.04
"Payment or Distribution" 11.01
"Redemption Price" 3.01
"Registrar" 2.04
"Rule 13e-3 Transaction" 10.06
"Securities" Recitals
"TIA" 1.03
"U.S. Government Obligations" 8.01
SECTION 1.03 Incorporation by Reference to Trust Indenture Act.
-------------------------------------------------
Whenever this Indenture refers to a provision of the Trust Indenture
Act of 1939 (the "TIA"), the provision is incorporated by reference in and made
a part of this Indenture. The following TIA terms used in this Indenture have
the following meanings:
"Commission" means the Securities and Exchange Commission.
"indenture securities" means the Securities.
"indenture security holder" means a Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Company or any other
obligor on the indenture securities.
-5-
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by Commission rules have
the meanings assigned to them therein.
SECTION 1.04 Rules of Construction.
---------------------
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with United States generally accepted accounting principles
in effect as of the time as to which such accounting principles are to be
applied;
(3) "or" is not exclusive; and
(4) words in the singular include the plural, and in the plural
include the singular.
ARTICLE 2
THE SECURITIES
SECTION 2.01 Forms Generally.
---------------
The Securities of each series shall be in substantially the form
(including any global form that is not inconsistent with this Indenture) as
shall be established from time to time by or pursuant to a Board Resolution or
in one or more indentures supplemental hereto, in each case with such variations
as are required or permitted by this Indenture (including such other provisions
as are necessary to reflect the global form of any Security, and the designation
of a Depositary for such Global Security) and may have imprinted or otherwise
reproduced thereon such legend or legends, not inconsistent with the provisions
of this Indenture, as may be required to comply with any law 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 the Securities.
SECTION 2.02 Amount Unlimited; Issuable in Series.
------------------------------------
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. There shall be
established in or pursuant to a Board Resolution, and set forth in an Officers'
Certificate, or established in one or more indentures supplemental hereto, prior
to the issuance of Securities of any series:
(1) the title of the Securities of the series (which shall
distinguish the Securities of the series from all other Securities);
-6-
(2) the limit, if any, upon the aggregate principal amount of
the Securities of the series which may be authenticated and delivered
under this Indenture (except for Securities authenticated and
delivered upon registration of transfer of, or in exchange for, or in
lieu of, other Securities of the series pursuant to this Indenture);
(3) the date or dates on which the principal of (and premium, if
any, on) the Securities of the series is payable;
(4) the rate or rates, if any, at which the Securities of the
series shall bear interest (or the method of determining such rate or
rates), the date or dates from which such interest shall accrue, date
or dates on which such interest shall be payable and the record date
or dates for the interest payable;
(5) the place or places where the principal of (and premium, if
any) and interest on Securities of the series shall be payable;
(6) the period or periods within which or the date or dates on
which, if any, the price or prices at which and the terms and
conditions upon which Securities of the series may be redeemed, in
whole or in part, at the option of the Company;
(7) the obligation, if any, of the Company to redeem, repay or
purchase Securities of the series pursuant to any sinking fund or
analogous provisions or at the option of a Securityholder thereof and
the period or periods within which, the price or prices at which and
the terms and conditions upon which Securities of the series shall be
redeemed, repaid or purchased, in whole or in part, pursuant to such
obligation;
(8) the price at which Securities of any one series are or may
be converted into shares of Capital Stock of the Company;
(9) if other than the principal amount thereof, the portion of
the principal amount of Securities of the series which shall be
payable upon declaration of acceleration of the maturity thereof;
(10) whether any Securities of the series are to be issued in
whole or in part in the form of one or more Global Securities and, if
so, the Depositary for such Global Security or Securities (which
Depositary shall be, if then required by applicable law or regulation,
a clearing agency registered under the Exchange Act and any other
applicable statute or
-7-
regulation) and whether beneficial owners of interests in such Global
Security or Securities may exchange such interests for Securities of
such series and any authorized form and denomination of such
Securities and the circumstances under which any such exchanges may
occur (if other than in the manner provided in Section 2.06);
(11) the identity of each Paying Agent, Conversion Agent and
Registrar (each as defined in Section 2.04) for the Securities of such
series; and
(12) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture).
All Securities of any one series shall be substantially identical
except as to denomination and except as may otherwise be provided in or pursuant
to such Board Resolution and set forth in such Officers' Certificate or in any
such indenture supplemental hereto.
If any of the terms of a series of Securities are established by
action taken pursuant to a Board Resolution, a copy of an appropriate record of
such action shall be certified by the Secretary or an Assistant Secretary of the
Company and delivered to the Trustee at or prior to the delivery to the Trustee
of the Officers' Certificate or supplemental indenture setting forth the terms
of the series.
SECTION 2.03 Execution and Authentication.
----------------------------
Two Officers shall sign the Securities for the Company by manual or
facsimile signature. The Company's seal shall be impressed, affixed, imprinted
or reproduced on the Securities and may be in facsimile form.
If an Officer whose signature is on a Security no longer holds that
office at the time the Trustee authenticates the Security, the Security shall
nevertheless be valid.
A Security shall not be valid until the Trustee manually signs the
certificate of authentication on the Security. Such signature shall be
conclusive evidence that the Security has been authenticated under this
Indenture.
The Trustee shall authenticate Securities for original issue upon
written order or orders of the Company signed by two Officers or by an Officer
and an Assistant Treasurer of the Company (a "Company Order").
The Trustee may appoint an authenticating agent to authenticate
Securities. An authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication
-8-
by such agent. An authenticating agent has the same rights as an Agent to deal
with the Company or an Affiliate.
The Securities may be issued in registered form without coupons. The
Securities shall be issuable only in denominations of $1,000 principal amount
and any integral multiple thereof.
The Trustee shall inform the Depositary with respect to the Securities
of any series that the Trustee has endorsed pursuant to the provisions of
Section 2.15.
SECTION 2.04 Registrar and Agents.
--------------------
The Company shall maintain an office or agency where Securities of any
series may be presented for registration of transfer or for exchange
("Registrar"), an office or agency where Securities of any series may be
presented for payment ("Paying Agent"), an office or agency where Securities of
any series may be presented for conversion ("Conversion Agent") and an office or
agency where notices and demands to or upon the Company in respect of the
Securities and this Indenture may be served. The Registrar shall keep a
register of the Securities of each series and of their transfer and exchange.
The Company may have one or more co-registrars, one or more additional Paying
Agents and one or more additional Conversion Agents. The Company or any
Subsidiary may act as Paying Agent and/or Conversion Agent. The term "Paying
Agent" includes any additional paying agent and the term "Conversion Agent"
includes any additional conversion agent.
The Company may change any Paying Agent, Registrar, Conversion Agent
or Co-Registrar on sixty (60) days' prior written notice to the Trustee. The
Company shall notify the Trustee in writing of the name and address of any such
Agent. If the Company fails to maintain a Registrar, Paying Agent, Conversion
Agent or agent for service of notices and demands, or fails to give the
foregoing notice, the Trustee shall act as such.
-9-
The Company and the Trustee initially appoint the Trustee as
Registrar, Paying Agent, Conversion Agent and agent for service of notices and
demands.
SECTION 2.05 Paying Agent to Hold Money in Trust.
-----------------------------------
Prior to each due date of the principal of, premium if any, and
interest on any Securities of any series, the Company shall deposit with each
Paying Agent a sum sufficient to pay such principal, premium, if any, and
interest so becoming due. The Company shall require each Paying Agent other
than the Trustee to agree in writing that it will hold in trust for the benefit
of Holders of Securities of any series or the Trustee all money held by the
Paying Agent for the payment of principal of, premium if any, or interest on the
Securities of such series and to notify the Trustee in writing of any default by
the Company (or any other obligor on the Securities of such series) in making
any such payment. If the Company or a Subsidiary acts as Paying Agent, it shall
on or before each due date of the principal of, premium, if any, or interest on
any Securities of any series segregate the money and hold it as a separate trust
fund. The Company at any time may require a Paying Agent to pay all money held
by it to the Trustee and the Trustee may at any time during the continuance of
any payment default, upon written request to a Paying Agent, require such Paying
Agent to forthwith pay to the Trustee all sums so held in trust by such Paying
Agent. Upon doing so, the Paying Agent (other than the Company or a Subsidiary
thereof) shall have no further liability for the money.
SECTION 2.06 Transfer and Exchange.
---------------------
(a) When a Security of any series is presented to the Registrar or a
co-registrar with a request to register the transfer, the Registrar or co-
registrar shall register the transfer as requested and when Securities of any
series are presented to the Registrar or a co-registrar with a request to
exchange them for a like aggregate principal amount of Securities of such series
in other authorized denominations, the Registrar shall make the exchange as
requested, provided that every Security presented or surrendered for
registration or transfer or exchange shall be duly endorsed, or be accompanied
by a written instrument of transfer in form satisfactory to the Company and the
Registrar duly executed by the Holder thereof or his attorney-in-fact duly
authorized in writing. To permit registrations of transfers and exchanges, the
Company shall issue and the Trustee or any authenticating agent shall
authenticate Securities of such series at the Registrar's or co-registrar's
written request. No service charge shall be made for any registration of
transfer or exchange of Securities but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto, but this provision shall not apply to any exchange pursuant to
Section 2.09, 3.06, 9.05 or 10.02 not involving any transfer.
Unless and until a Global Security is exchanged in
-10-
whole or in part for Securities in definitive form in accordance with the
provisions of this Indenture, a Global Security may not be transferred, except
as a whole, by the Depositary to a nominee of such Depositary or by a nominee of
such Depositary to such Depositary or another nominee of such Depositary or by
such Depositary or any such nominee to a successor of such Depositary or
nominee. Unless otherwise provided as contemplated by Section 2.02 of this
Indenture, the Depositary may not sell, assign, transfer or otherwise convey any
beneficial interest in a Global Security evidencing all or part of the
Securities of such series unless such beneficial interest is in an amount equal
to an authorized denomination for Securities of such series.
At the option of the Holder, Securities of any series may be exchanged
for other Securities of such series of any authorized denominations and of a
like aggregate principal amount, upon surrender to the Registrar or a co-
registrar of the Securities to be exchanged. Whenever any Securities are so
surrendered for exchange, the Company shall execute, and the Trustee shall
authenticate and make available for delivery, the Securities which the Holder
making the exchange is entitled to receive.
(b) The Registrar shall not be required (i) to issue, register the
transfer of, or exchange Securities of any series during a period beginning at
the opening of business 15 days before the day of any selection of Securities of
such series for redemption under Section 3.02 and ending at the close of
business on the day of selection, (ii) to register the transfer or exchange of
any Security of any series so selected for redemption in whole or in part,
except the unredeemed portion of any Security being redeemed in part, or (iii)
to register the transfer or exchange of any Securities of any series during a
period beginning at the opening of business 15 days before the day of any
selection of Securities of such series for redemption under Section 3.02 and
ending at the close of business on the day interest is to be paid on Securities
of such series.
(c) If at any time the Depositary for any Securities of a series
issued in the form of one or more Global Securities notifies the Company that it
is unwilling or unable to continue as Depositary for such Securities or if at
any time the Depositary for the Securities of such series shall no longer be
eligible under Section 2.02 of this Indenture, the Company shall appoint a
successor Depositary with respect to such Securities. If a successor Depositary
for such Securities is not appointed by the Company within ninety (90) days
after the Company receives such notice or becomes aware of such ineligibility,
the Company's election to issue Global Securities pursuant to Section 2.02 shall
no longer be effective with respect to such Securities and the Company will
execute, and the Trustee, upon receipt of a Company Order for the authentication
and delivery of definitive Securities of such series, will authenticate
Securities of such series in definitive form, in authorized denominations, in an
aggregate principal amount equal to the principal amount of the Global
-11-
Security or Securities in exchange for such Global Security or Securities and
deliver such definitive Securities to the Securityholders of such series.
The Company may at any time and in its sole discretion determine that
the Securities of any series issued in the form of one or more Global Securities
shall no longer be represented by such Global Security or Securities. The
Company shall notify the Depositary and the Trustee of the date and time of such
exchange in a Company Order. The Depositary shall surrender the Global
Securities to the Trustee as the Company's agent for such purpose as shall be
specified in the Company Order. The Company will execute, and the Trustee, upon
receipt of a Company Order for the authentication and delivery of definitive
Securities of such series, will authenticate and deliver, Securities of such
series in definitive form, in authorized denominations, and in an aggregate
principal amount equal to the principal amount of the Global Security or
Securities in exchange for such Global Security or Securities.
Notwithstanding the foregoing, except as otherwise specified as
contemplated by Section 2.02 of this Indenture, any Global Security shall be
exchangeable only as provided in this paragraph. If the owners of beneficial
interests in a Global Security of any series are entitled to exchange such
interests for Securities of such series, as may be specified in accordance with
Section 2.02 of this Indenture, then without unnecessary delay upon receipt of
notice therefrom so specified as contemplated by Section 2.02 of this Indenture
but in any event not later than one business day prior to the earliest date on
which such interests may be so exchanged, the Company shall deliver to the
Trustee definitive Securities of such series, in authorized denominations, and
in aggregate principal amount equal to the principal amount of such Global
Security, executed by the Company. On or after the earliest date on which such
interests may be so exchanged, such Global Security shall be surrendered by the
Depositary as shall be specified in the Company Order with respect thereto to
the Trustee, as the Company's agent for such purpose, to be exchanged, in whole
or from time to time in part, for definitive Securities of such series, without
charge, and the Trustee shall authenticate and deliver, in exchange for each
portion of such Global Securities, a like aggregate principal amount of
definitive Securities of the same series in authorized denominations as the
portion of such Global Securities to be so exchanged; provided, however, that no
such exchanges may occur for a period of 15 days immediately preceding the date
notice is received by the Company requesting such changes.
-12-
SECTION 2.07 Replacement Securities.
----------------------
If a mutilated Security of any series is surrendered to the Trustee or
if the Holder of a Security of any series presents evidence to the satisfaction
of the Company and the Trustee that the Security has been lost, destroyed or
wrongfully taken, the Company shall issue and the Trustee shall authenticate a
replacement Security of such series if the requirements of the Trustee and the
Company are met. An indemnity bond may be required by the Company or the
Trustee that is sufficient in the judgment of the Company to protect the Company
and is sufficient in the judgment of the Trustee to protect the Trustee or any
Agent from any loss which it may suffer if a Security of such series is
replaced. The Company may charge for its expense in replacing a Security.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Company in its sole discretion
may, instead of issuing a new Security, pay or authorize the payment or convert
or authorize the conversion of such Security.
Every new Security issued pursuant to this Section in lieu of any
destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities duly issued hereunder.
SECTION 2.08 Outstanding Securities.
----------------------
Securities of any series outstanding at any time are all Securities of
such series authenticated by the Trustee except for those canceled by it, those
delivered to it for cancellation and those described in this Section 2.08 as not
outstanding.
If a Security is replaced pursuant to Section 2.07, it ceases to be
outstanding until the Trustee receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser.
If the Paying Agent (other than the Company or a Subsidiary) holds on
a Redemption Date or maturity date money deposited with it by or on behalf of
the Company sufficient to pay the principal of and accrued interest on
Securities of any series payable on that date, then on and after that date such
Securities cease to be outstanding and interest on them ceases to accrue.
-13-
A Security does not cease to be outstanding because the Company or an
Affiliate holds the Security.
SECTION 2.09 Temporary Securities.
--------------------
Until definitive Securities of any series are ready for delivery, the
Company may prepare and the Trustee shall authenticate temporary Securities of
such series. Temporary Securities of any series shall be substantially in the
form of definitive Securities of such series but may have non-material
variations that the Company considers appropriate for temporary Securities.
Without unreasonable delay, the Company shall prepare and the Trustee shall
authenticate definitive Securities of any series in exchange for temporary
Securities of such series upon written order of the Company signed by two
Officers. Until so exchanged, temporary Securities of any series represent the
same rights as definitive Securities of such series. Upon request of the
Trustee, the Company shall provide a certificate to the effect that the
temporary Securities of any series meet the requirements of the second sentence
of this Section 2.09.
SECTION 2.10 Cancellation.
------------
The Company at any time may deliver Securities of any series to the
Trustee for cancellation. The Registrar, the Paying Agent and the Conversion
Agent shall forward to the Trustee any Securities surrendered to them for
transfer, exchange, payment or conversion. The Trustee shall cancel all
Securities surrendered for transfer, exchange, payment or conversion and destroy
canceled Securities in accordance with its customary destruction procedures and
deliver a certificate of such destruction to the Company unless the Company
directs the Trustee in writing prior to such destruction to deliver canceled
Securities to the Company. Subject to Sections 2.07, 3.06 and the second
paragraph of Section 10.02, the Company may not issue Securities to replace
Securities that it has previously paid or delivered to the Trustee for
cancellation or that a Securityholder has converted pursuant to Article 10
hereof.
SECTION 2.11 Defaulted Interest.
------------------
If the Company defaults in a payment of interest on Securities of any
series, it shall pay the defaulted interest to the Persons who are Holders of
the Securities of such series on a subsequent special record date. After the
deposit by the Company with the Trustee of money sufficient to pay such
defaulted interest, the Trustee shall fix the record date and payment date.
Each such special record date shall be not less than 10 days prior to such
payment date. Each such payment date shall be not more than 60 days after the
deposit by the Company of money to pay the defaulted interest. At least 15 days
before the special record date, the Company shall mail to each Holder of a
Security of such series a notice that states the special record date, the
payment date, and the amount of defaulted interest to be paid. The Company may
pay defaulted interest in any other lawful manner if,
-14-
after prior notice to the Trustee, such payment shall be deemed operationally
practicable by the Trustee.
SECTION 2.12 Securityholder Lists.
--------------------
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Holders of Securities of each series. If the Trustee is not the Registrar, the
Company or other obligor, if any, shall furnish to the Trustee at least seven
Business Days prior to each semiannual interest payment date and at such other
times as the Trustee may request in writing a list in such form and as of such
date as the Trustee may reasonably require of the names and addresses of Holders
of Securities of each series upon which the Trustee may conclusively rely. The
Trustee may destroy any such list upon receipt of a replacement list. The
Paying Agent will solicit from each Securityholder a certification of social
security number or taxpayer identification number in accordance with its
customary practice and as required by law, unless the Paying Agent is in
possession of such certification. Each Paying Agent is authorized to impose
back-up withholding with respect to payments to be made to Securityholders to
the extent required by law.
SECTION 2.13 Persons Deemed Owners.
---------------------
Prior to presentment of a Security of any series for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name such Security is registered as the owner of
such Security and neither the Company, the Trustee nor any agent of the Company
or the Trustee shall be affected by notice to the contrary.
SECTION 2.14 CUSIP Number.
------------
The Company may use a "CUSIP" number when issuing Securities of any
series, and if so, the Trustee may use the CUSIP number in notices of redemption
or exchange as a convenience to Holders of Securities of such series; provided,
that any such notice may state that no representation is made as to the
correctness or accuracy of the CUSIP number printed in the notice or on the
Securities, and that reliance may be placed only on the other identification
numbers printed on the Securities.
SECTION 2.15 Provisions in Global Security.
-----------------------------
(a) If Securities of a series are issuable in whole or in part as
Global Securities, as may be specified in accordance with Section 2.02 of this
Indenture, then in accordance with any such Global Security, such Global
Security may represent such of the outstanding Securities of such series as
shall be specified therein and may also provide that it represents the aggregate
principal amount of outstanding Securities from time to time endorsed thereon
and that the aggregate principal amount of outstanding Securities represented
thereby may from time to time
-15-
be reduced to reflect exchanges. Global Securities may be permanent or
temporary. Any endorsement of a Global Security to reflect the amount, or any
increase or decrease in the principal amount, of outstanding Securities
represented thereby shall be made by the Trustee in such manner and upon
instructions given by such Person or Persons as shall be specified therein or in
the Company Order to be delivered to the Trustee and the Depositary pursuant to
Section 2.03 or Section 2.09. Subject to the provisions of Section 2.03 and, if
applicable, Section 2.09, the Depositary shall deliver and redeliver any
permanent Global Security in the manner and upon written instructions given by
the Person or Persons specified therein or in the applicable Company Order.
(b) Notwithstanding the other provisions of this Indenture, unless
otherwise specified in accordance with Section 2.02, payment of principal of
(and premium, if any) and interest, if any, on any permanent Global Securities
shall be made directly to owners of beneficial interest of such Global Security.
(c) Notwithstanding the provisions of Section 2.13 of this Indenture,
the Company, the Trustee and any agent of the Company or the Trustee shall treat
the owners of beneficial interest of such Global Security as the Holders of such
principal amounts of outstanding Securities represented by a Global Security as
shall be specified in writing by the Depositary and delivered to the Company and
the Trustee with respect to such Global Security only for purposes of obtaining
any consents or directions required to be given by the Holders pursuant to this
Indenture.
(d) Unless otherwise provided as contemplated by Section 2.02, a
Global Security of any series shall provide, in addition to the provisions
established pursuant to Sections 2.01, 2.02 and 2.15(a) through (c), that the
Depositary will not sell, assign, transfer or otherwise convey any beneficial
interest in such Global Security unless such beneficial interest is in an amount
equal to an authorized denomination for Securities of such series, and the
Depository, by accepting such Global Security, agrees to be bound by such
provision. Any Global Security shall also contain such other provisions as are
necessary to reflect the global form of such Security and the designation of a
Depositary for such Global Security.
-16-
ARTICLE 3
REDEMPTION
SECTION 3.01 Right of Redemption.
-------------------
(a) The Company may, at its option, redeem Securities of any series
as permitted or required by the terms of such Securities, which redemption shall
be made in accordance with the terms of such Securities and this Article. The
election of the Company to redeem any Securities pursuant to this Section shall
be evidenced by a Board Resolution. The Company shall, at least 45 days prior
to the Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee of such Redemption Date and, in
the case of any redemption at the election of the Company of less than all the
Securities of any series, of the principal amount of Securities of that series
to be redeemed.
(b) If the Company wants to redeem the Securities of any series
pursuant to the redemption provisions of the Securities of such series, it shall
notify the Trustee of the Redemption Date and the principal amount of Securities
of such series to be redeemed. The notice shall be in writing and accompanied
by an Officers' Certificate stating that the redemption complies with the
provisions of this Indenture and the provisions of the applicable Board
Resolution, if any, and in the Securities of such series.
The Company shall give each notice provided for in this Section 3.01
in writing and at least 45 but not more than 90 days before the Redemption Date
or such other period as the Company and the Trustee may agree.
-17-
SECTION 3.02 Selection of Securities to be Redeemed.
--------------------------------------
If any part of a series of Securities is to be redeemed, the Trustee
shall select the Securities of such series to be redeemed pro rata or by lot or
by any other method that the Trustee considers fair and appropriate under the
circumstances. The Trustee shall promptly notify the Company of the Securities
of such series to be so called for redemption. The Trustee shall make the
selection from Securities of such series outstanding and not previously called
for redemption. The Trustee may select for redemption portions of the principal
of Securities that have denominations larger than $1,000 principal amount.
Securities and portions of them it selects shall be in principal amounts of
$1,000 or multiples thereof. Provisions of this Indenture that apply to
Securities called for redemption also apply to portions of Securities called for
redemption. The Trustee's selection of Securities for redemption by any method
authorized by this Section 3.02 shall be conclusively deemed reasonable.
SECTION 3.03 Notice of Redemption by the Company.
-----------------------------------
At least 30 days but not more than 60 days before a Redemption Date
with respect to Securities of any series, the Company shall mail a notice of
redemption by first-class mail to each Holder of Securities of such series to be
redeemed. The notice shall identify the Securities to be redeemed and shall
state:
(1) the Redemption Date;
(2) the Redemption Price;
(3) the name and address of the Paying Agent and the Conversion
Agent;
(4) that Securities called for redemption must be surrendered to
the Paying Agent to collect the redemption price;
(5) that interest on Securities called for redemption ceases to
accrue on and after the Redemption Date;
(6) if any Security is being redeemed in part, the portion of
the principal amount of such Security to be redeemed and
that, after the Redemption Date, upon surrender of such
Security, a new Security or Securities of the same series in
principal amount equal to the unredeemed portion thereof
will be issued; and
(7) any conversion rights with respect to the Securities and the
applicable procedures required to be followed in connection
with a conversion of Securities.
-18-
At the Company's written request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's expense. If a CUSIP
number is listed in such notice or printed on the Security, the notice shall
state that no representation is made as to the correctness or accuracy of such
CUSIP number.
SECTION 3.04 Effect of Notice of Redemption.
------------------------------
Once notice of redemption is mailed, Securities called for redemption
become due and payable on the applicable Redemption Date and at the applicable
Redemption Price. Upon surrender to the Paying Agent, such Securities shall be
paid at the Redemption Price, plus accrued interest to the Redemption Date.
SECTION 3.05 Deposit of Redemption Price.
---------------------------
On or before the Redemption Date with respect to any series of
Securities, the Company shall deposit with the Paying Agent (or if the Company
or a Subsidiary is the Paying Agent, shall segregate and hold in trust or cause
such Subsidiary to segregate and hold in trust) in immediately available funds
money sufficient to pay the Redemption Price of and accrued interest on all
Securities of such series to be redeemed on that date. The Trustee or the
Paying Agent shall return to the Company any money so received not required for
that purpose.
SECTION 3.06 Securities Redeemed in Part.
---------------------------
Upon surrender of a Security of any series that is redeemed in part,
the Trustee shall authenticate for the Holder, at the expense of the Company, a
new Security of such series equal in principal amount to the unredeemed portion
of the Security surrendered. If a Global Security is so surrendered, such new
Security so issued shall be a new Global Security.
ARTICLE 4
COVENANTS
SECTION 4.01 Payment of the Securities.
-------------------------
The Company shall pay the principal of, premium, if any, and interest
on the Securities of any series on the dates and in the manner provided in the
Securities of such series and this Indenture. An installment of principal,
premium, if any, or interest shall be considered paid on the date it is due if
the Trustee or Paying Agent (other than the Company or a Subsidiary) holds on
that date money designated for and sufficient to pay the installment. The
Company shall pay interest on overdue principal and premium, if any, at the rate
borne by the Security; it shall pay interest, including post-petition interest
in the event of a proceeding under the Bankruptcy Laws, on overdue installments
of interest at the same rate to the extent lawful.
-19-
SECTION 4.02 Commission Reports.
------------------
The Company shall file with the Trustee, promptly after it files them
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 by rules and regulations prescribe) which the Company is
required to file with the Commission pursuant to Section 13 or 15(d) of the
Exchange Act. The Company shall also comply with the other provisions of TIA
(S) 314(a).
So long as the Securities remain outstanding, the Company shall cause
its annual reports to shareholders (containing audited financial statements) and
any other financial reports furnished by it to shareholders to be mailed to the
Holders at their addresses appearing in the register of Securities maintained by
the Registrar.
SECTION 4.03 Waiver of Stay, Extension or Usury Laws.
---------------------------------------
The Company expressly waives (to the extent that it may lawfully do
so) any stay or extension law or any usury law or other law that would prohibit
or forgive the Company from paying all or any portion of the principal of
(premium, if any) or interest on Securities of any series as contemplated
herein, wherever enacted, now or at any time hereafter in force, or that may
affect the covenants or the performance of this Indenture.
SECTION 4.04 Notice of Default.
-----------------
The Company will, so long as any Securities of any series are
outstanding, deliver to the Trustee, within 10 days of becoming aware of any
Default or Event of Default in the performance of any covenant, agreement or
condition in this Indenture, an Officers' Certificate specifying such Default or
Event of Default, the period of existence thereof and what action the Company is
taking or proposes to take with respect thereto.
SECTION 4.05 Compliance Certificates.
-----------------------
The Company will deliver to the Trustee, within 120 days after the end
of each fiscal year of the Company (which as of the date hereof is December 31),
a written statement signed by the principal executive officer, principal
financial officer or principal accounting officer of the Company, stating, as to
each signer thereof, that
(1) a review of the activities of the Company during such year and of
performance under this Indenture has been made under his supervision and
(2) to the best of his knowledge, based on such review, the Company
has kept, observed, performed and fulfilled in all material respects each and
every condition and covenant contained in this Indenture throughout such year,
or, if there has
-20-
been a default in the fulfillment of any such condition or covenant, specifying
each such default known to him and the nature and status thereof.
The Company will give the Trustee written notice of a change in the
fiscal year of the Company, within a reasonable time after such change is
effected.
SECTION 4.06 Limitation on Dividends and Other Distributions.
-----------------------------------------------
The Company will not declare or pay any dividends or make any
distribution to holders of its Capital Stock (other than dividends or
distributions payable in Capital Stock of the Company), or purchase, redeem or
otherwise acquire or retire for value any of its Capital Stock or permit any
Subsidiary to purchase, redeem or otherwise acquire or retire for value any of
the Company's Capital Stock if at the time of any of the aforementioned actions
an Event of Default has occurred and is continuing or would exist immediately
after giving effect to such action.
-21-
Notwithstanding the foregoing, the provisions of this Section 4.06
will not prevent (i) the payment of any dividend within 60 days after the date
of declaration when the payment would have complied with the foregoing
provisions on the date of declaration and (ii) the retirement of any share of
the Company's Capital Stock by exchange for, or out of the proceeds of the
substantially concurrent sale (other than to a Subsidiary) of, other shares of
its Capital Stock.
ARTICLE 5
SUCCESSOR CORPORATION
SECTION 5.01 When Company May Merge, etc.
----------------------------
The Company shall not consolidate with or merge into, or transfer all
or substantially all of its assets to, another Person in any transaction in
which the Company is not the continuing or surviving entity unless (i) the
resulting, surviving or transferee Person is a corporation or trust which
assumes by supplemental indenture all the obligations of the Company under the
Securities of each series and this Indenture; (ii) such corporation or trust is
organized and existing under the laws of the United States, a State thereof or
the District of Columbia although it in turn may be owned by a foreign entity;
(iii)immediately after giving effect to such transaction no Default or Event of
Default shall have happened and be continuing, and the Officers' Certificate
referred to in the following clause reflects that such Officers are not aware of
any such Default or Event of Default that shall have happened and be continuing,
and (iv) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger or transfer and such supplemental indenture comply with this Indenture,
and thereafter all obligations of the Company shall terminate.
SECTION 5.02 Successor Corporation or Trust Substituted.
------------------------------------------
Upon any consolidation or merger, or any transfer of all or
substantially all of the assets of the Company in accordance with Section 5.01,
the successor corporation or trust formed by such consolidation or into which
the Company is merged or to which such transfer is made shall succeed to, and be
substituted for, and may exercise every right and power of, the Company under
this Indenture with the same effect as if such successor corporation or trust
has been named as the Company herein.
-22-
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01 Events of Default.
-----------------
An "Event of Default" occurs if, with respect to any series of
Securities:
(1) the Company defaults in the payment of interest on any
Security of such series when the same becomes due and payable and the
default continues for a period of 30 days;
(2) the Company defaults in the payment of the principal of (and
premium, if any, on) any Security of such series when the same becomes
due and payable at maturity, upon redemption or otherwise, and the
default continues for five Business Days;
(3) the Company fails to comply with any of its other agreements
in the Securities of such series or this Indenture and the default
continues for the period and after the notice specified in the last
paragraph of this Section 6.01;
(4) there shall be a default under any bond, debenture, note or
other evidence of Indebtedness or under any mortgage, indenture or
other instrument under which there may be issued or by which there may
be secured or evidenced any Indebtedness of the Company or any
Subsidiary, whether any such Indebtedness now exists or shall
hereafter be created, if (a) either (i) such event of default results
from the failure to pay any such Indebtedness at maturity or (ii) as a
result of such event of default, the maturity of such Indebtedness has
been accelerated prior to its stated maturity and such acceleration
shall not be rescinded or annulled or the accelerated amount paid
within ten days after notice to the Company of such or acceleration,
or such Indebtedness having been discharged and (b) the principal
amount of such Indebtedness, together with the principal amount of any
other such Indebtedness in default for failure to pay principal or
interest thereon, or the maturity of which has been so accelerated,
aggregates $5,000,000 or more;
(5) the Company pursuant to or within the meaning of any
Bankruptcy Law:
(A) commences a voluntary case or proceeding,
(B) consents to the entry of an order for relief against it
in an involuntary case or proceeding,
(C) consents to the appointment of a Custodian of it or for
all or substantially all of its property, or
-23-
(D) makes a general assignment for the benefit of its
creditors; or
(6) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(A) is for relief against the Company in an involuntary
case or proceeding,
(B) appoints a Custodian of the Company or for all or
substantially all of its property, or
(C) orders the liquidation of the Company,
and the order or decree remains unstayed and in effect for 90 days;
provided, however, that a default under this Section 6.01 is not an Event of
-------- -------
Default with respect to any series of Securities if a specified event is either
applicable to a particular series other than such series or it is specifically
deleted or modified in the supplemental indenture creating such series of
Securities or in the form of Security for such series.
-24-
A default under clause (3) is not an Event of Default with respect to
any series of Securities until the Trustee notifies the Company, or the Holders
of a majority in principal amount of the Securities of such series then
outstanding notify the Company and the Trustee in writing, of the default and
the Company does not cure the default within 60 days after receipt of such
notice. The notice must specify the default, demand that it be remedied and
state that the notice is a "Notice of Default." The Trustee shall give such
notice to the Company only if directed to do so in writing by the Holders of a
majority in principal amount of the Securities then outstanding. Such notice by
the Trustee shall not be deemed to be a certification by the Trustee as to
whether an Event of Default has occurred.
SECTION 6.02 Acceleration.
------------
If an Event of Default occurs and is continuing with respect to any
series of Securities, the Trustee by notice to the Company, or the Holders of a
majority in principal amount of the Securities of such series then outstanding
by notice to the Company and the Trustee, may declare to be due and payable
immediately the principal amount of the Securities of such series plus accrued
interest to the date of acceleration. Upon any such declaration, such amount
shall be due and payable immediately, and upon payment of such amount all of the
Company's obligations with respect to the Securities of such series, other than
obligations under Section 7.07, shall terminate. The Holders of a majority in
principal amount of the outstanding Securities of such series by written notice
to the Trustee may rescind an acceleration and its consequences if (x) all
existing Events of Default with respect to the Securities of such series, other
than the non-payment of the principal of the Securities of such series, which
have become due solely by such declaration of acceleration, have been cured or
waived, (y) to the extent the payment of such interest is lawful, interest on
overdue installments of interest and overdue principal which has become due
otherwise than by such declaration of acceleration, has been paid, and (z) the
rescission would not conflict with any judgment or decree of a court of
competent jurisdiction. The Trustee may rely upon such notice of rescission
without any independent investigation as to the satisfaction of conditions (x),
(y) and (z).
SECTION 6.03 Other Remedies.
--------------
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy by proceeding at law or in equity to collect the
payment of principal (and premium, if any) or interest on the Securities of such
series or to enforce the performance of any provision of the Securities of such
series or this Indenture.
-25-
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Securityholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.
SECTION 6.04 Waiver of Defaults and Events of Default.
----------------------------------------
Subject to Section 9.02, the Holders of a majority in principal amount
of the Securities of any series then outstanding, on behalf of the Holders of
the Securities of such series, by written notice to the Trustee may waive a
Default or Event of Default with respect to the Securities of such series and
its consequences. When a Default or Event of Default is waived with respect to
the Securities of any series, it is cured and ceases.
SECTION 6.05 Control by Majority.
-------------------
The Holders of a majority in principal amount of the Securities of any
series then outstanding may direct in writing the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred on it with respect to the Securities of such
series. The Trustee, however, may refuse to follow any direction that conflicts
with law or this Indenture, that the Trustee determines may be unduly
prejudicial to the rights of other Securityholders, it being understood that
(subject to Section 7.01) the Trustee shall have no duty to ascertain whether or
not such actions or forebearances are unduly prejudicial to such Securityholders
or that may involve the Trustee in personal liability or for which the Trustee
does not have adequate indemnification pursuant to Section 7.01(e); provided,
--------
that, the Trustee may take any other action deemed proper by the Trustee which
is not inconsistent with such direction.
SECTION 6.06 Rights of Holders to Receive Payment.
------------------------------------
Notwithstanding any other provision of this Indenture, the right of
any Holder of a Security of any series to receive payment of principal of,
premium, if any, and interest on such Security, on or after the respective due
dates expressed in such Security, or to bring suit for the enforcement of any
such payment on or after such respective dates, is absolute and unconditional
and shall not be impaired or affected without the consent of the Holder.
-26-
Notwithstanding any other provision of this Indenture (other than
Section 3.01), the right of any Holder of any Security to convert such Security
or to bring suit for the enforcement of such right shall not be impaired or
affected without the written consent of the Holder.
SECTION 6.07 Collection Suit by Trustee.
--------------------------
If an Event of Default with respect to any series of Securities in
payment of interest or principal (and premium, if any) specified in Section
6.01(1) or (2) occurs and is continuing, the Trustee may recover judgment in its
own name and as trustee of an express trust against the Company or any other
obligor on the Securities of such series for the whole amount of unpaid
principal (and premium, if any) and accrued interest remaining unpaid on the
Securities of such series, together with interest on overdue principal (and
premium, if any) and to the extent that payment of such interest is lawful,
interest on overdue installments of interest, in each case at the rate borne by
the Securities of such series and 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.
SECTION 6.08 Trustee May File Proofs of Claim.
--------------------------------
The Trustee may file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of Securities of any series allowed in any judicial proceedings relative
to the Company (or any other obligor upon the Securities of any series), its
creditors or its property and shall be entitled and empowered to collect and
receive any monies or other property payable or deliverable on any such claims
and to distribute the same. Any Custodian in any such judicial proceeding is
hereby authorized by each Securityholder to make such payments to the Trustee,
and in the event that the Trustee shall consent to the making of such payments
directly to the Holders of Securities of any series, 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 7.07.
-27-
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Securityholder any
plan or reorganization, arrangement, adjustment or composition affecting the
Securities of any series or the rights of any Holder thereof, or to authorize
the Trustee to vote in respect of the claim of any Securityholder in any such
proceedings.
SECTION 6.09 Priorities.
----------
If the Trustee collects any money pursuant to this Article 6 with
respect to the Securities of any series, it shall pay out the money in the
following order:
FIRST: to the Trustee for payment of costs and expenses of
collection, including all sums paid or advanced by the Trustee
hereunder and the reasonable compensation, expenses and
disbursements of the Trustee, its agents and counsel and all
other amounts due under Section 7.07;
SECOND: to holders of any Senior Indebtedness as required by
Article 11; and
THIRD: to Holders of Securities of such series for amounts due
and unpaid on the Securities of such series for principal of (and
premium, if any) and interest, ratably, without preference or
priority of any kind, according to the amounts due and payable on
the Securities of such series for principal (and premium, if any)
and interest, respectively; and
FOURTH: to the Company.
The Trustee may fix a record date and payment date for any payment to
Holders of Securities of any series pursuant to this Section 6.09.
SECTION 6.10 Undertaking for Costs.
---------------------
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorney's fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section 6.10 does not apply to a suit by the Trustee, a suit by a Holder
pursuant to Section 6.06 or a suit by Holders of more than 10% in principal
amount of the Securities of any series then outstanding or a suit by any holder
of Senior Indebtedness.
-28-
SECTION 6.11 Limitations on Suits.
--------------------
Subject to Section 6.06, a Holder of any series of Securities may not
pursue any remedy with respect to this Indenture or the Securities unless:
(1) the Holder has given the Trustee written notice of a continuing
Event of Default;
(2) the Holders of at least 25% in principal amount of such series of
Securities make a written request to the Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee indemnity
satisfactory to the Trustee against any loss, liability or expenses;
(4) The Trustee does not comply with the request within 60 days after
receipt of the notice, request and offer of indemnity; and
(5) no direction inconsistent with such written request has been
given to the Trustee during such 60 day period by the Holders of a
majority in principal amount of such series of Securities then
outstanding.
A Holder of any Security may not use this Indenture to prejudice the
rights of another Securityholder or to obtain a preference or priority over
another Securityholder.
ARTICLE 7
TRUSTEE
SECTION 7.01 Duties of Trustee.
-----------------
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise its rights and powers vested in it by this Indenture and
use the same degree of care and skill in their exercise as a prudent Person
would exercise or use under the circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default and
after the curing or waiving of all such Events of Default which may have
occurred:
(1) The Trustee need perform only those duties that are
specifically set forth in this Indenture, and the Trustee
shall not be liable except for the performance of such
duties as are specifically set forth in this Indenture, and
no others, and no implied covenants or obligation shall be
read into this Indenture against the Trustee.
-29-
(2) In the absence of bad faith on its part, the Trustee
may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon any
statements certificates or opinions furnished to the Trustee
and conforming to the requirements of this Indenture. The
Trustee, however, shall examine the certificates and
opinions to determine whether or not they conform to the
requirements of this Indenture.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) This paragraph does not limit the effect of paragraph (b) of
this Section 7.01.
(2) The Trustee shall not be liable for any error in judgment
made in good faith by a Trust Officer, unless it is proved that
the Trustee was negligent in ascertaining the pertinent facts.
(3) The Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 6.05.
(4) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder or in
the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not
reasonably assured to it.
(d) Every provision of this Indenture that in any way relates to
the Trustee is subject to paragraphs (a), (b) and (c) of this Section 7.01 and
subject to Sections 315 and 316 of the TIA.
(e) Subject to subsection (c), the Trustee may refuse to perform
any duty or exercise any right or power unless, subject to the provisions of the
TIA, it receives indemnity satisfactory to it against any loss, liability,
expense or fee.
-30-
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
SECTION 7.02 Rights of Trustee.
-----------------
(1) The Trustee may rely on and shall be protected in acting or
refraining from acting upon any document believed by it to be
genuine and to have been signed or presented by the proper
Person. The Trustee need not investigate any fact or matter
stated in the document.
(2) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel, or
both, which shall conform to Section 13.05. The Trustee shall not
be liable for any action it takes or omits to take in good faith
in reliance on such Officers' Certificate or Opinion of Counsel.
(3) The Trustee may act through agents or attorneys and shall
not be responsible for the misconduct or negligence of such
agents or attorneys appointed with due care and shall not be
responsible for their supervision.
(4) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or
within its rights or powers.
(5) The Trustee may consult with counsel and the written advice
of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action
taken, suffered or omitted by the Trustee hereunder in good faith
and reliance thereon.
-31-
(6) The Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Indenture at the
request or direction of any of the Holders of Securities of any
series pursuant to this Indenture, unless such Holders shall have
offered to the Trustee reasonable security or indemnity against
the costs, expenses and liabilities which might be incurred by it
in compliance with such request or direction.
SECTION 7.03 Individual Rights of Trustee.
----------------------------
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities of any series and may otherwise deal with the
Company or its Affiliates with the same rights it would have if it were not
Trustee. Any Agent may do the same with like rights. The Trustee, however, is
subject to Sections 7.10 and 7.11.
SECTION 7.04 Trustee's Disclaimer.
--------------------
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities of any series, it shall not be accountable for
the Company's use of the proceeds from the Securities of any series, and it
shall not be responsible for any statement of the Company in the Indenture or
any statement in the Securities of any series other than its certificate of
authentication or in any document used in the sale of the Securities of any
series other than any statement in writing provided by the Trustee expressly for
use in such document.
SECTION 7.05 Notice of Defaults.
------------------
If a Default or Event of Default occurs and is continuing and if it is
actually known to the Trustee with respect to the Securities of any series, the
Trustee shall mail to each Holder of Securities of such series notice of the
Default or Event of Default within 90 days after it occurs. Except in the case
of a default in payment of principal of, premium, if any, or interest on any
Security, the Trustee may withhold the notice if and so long as a committee of
its Trust Officers in good faith determines that withholding the notice is in
the interests of Holders of Securities of such series. Notwithstanding anything
to the contrary expressed in this Indenture, the Trustee shall not be deemed to
have knowledge of any Event of Default hereunder unless and until a Trust
Officer shall have actual knowledge thereof, or shall have received written
notice thereof from the Company at its principal Corporate Trust Office in
Chicago, Illinois. The Trustee shall not be deemed to have actual knowledge of
an Event of Default hereunder, except in the case of an Event of Default under
Sections 6.01(1) or 6.01(2) (provided that the Trustee is the Paying Agent),
until a Trust Officer receives written notice thereof from the Company or any
Securityholder that such an Event of Default has occurred.
-32-
SECTION 7.06 Reports by Trustee to Holders.
-----------------------------
Within 60 days after each May 15 beginning with May 15 of the first
year in which Securities are outstanding hereunder, the Trustee, if required by
the provisions of TIA (S) 313(a), shall mail to each Securityholder a brief
report dated as of May 15 of such year that complies with TIA (S) 313(a). The
Trustee also shall comply with TIA (S) (S) 313(b) and (S) 313(c).
A copy of each report at the time of its mailing to Securityholders
shall be filed with the Commission and each stock exchange on which the
Securities of any series are listed. The Company agrees to notify the Trustee
in writing whenever the Securities of any series become listed or delisted on or
from any stock exchange.
SECTION 7.07 Compensation and Indemnity.
--------------------------
The Company shall pay to the Trustee from time to time, and the
Trustee shall be entitled to, reasonable compensation for its services (which
compensation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust). The Company shall reimburse the
Trustee upon request for all reasonable disbursements, expenses and advances
incurred or made by it. Such expenses may include, but shall not be limited to,
the reasonable compensation, disbursements and expenses of the Trustee's agents
and counsel.
The Company shall indemnify the Trustee for, and hold it harmless
against, any loss or liability incurred by it in connection with the acceptance
or administration of this trust, including the costs and expenses of defending
itself against any claim or liability in connection with the Securities or the
exercise or performance of any of its powers or duties hereunder. The Trustee
shall notify the Company promptly of any claim asserted against the Trustee for
which it may seek indemnity and the Company may elect by written notice to the
Trustee to assume the defense of any such claim at the Company's expense with
counsel reasonably satisfactory to the Trustee; provided, however, that if the
Trustee is advised by counsel that the interests of the Company and the Trustee
conflict, the Trustee shall have the right to retain separate counsel.
-33-
The Company need not reimburse the Trustee for any expense or
indemnify it against any loss or liability incurred by it through the Trustee's
negligence or willful misconduct. The Company shall not be liable for any
settlement of any claim or action effected without the Company's consent, which
consent shall not be unreasonably withheld. To secure the Company's payment
obligations in this Section, the Trustee shall have a lien prior to the
Securities on all money or property held or collected by the Trustee.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01 occurs, the expenses and the compensation for
the services are intended to constitute expenses of administration under any
applicable bankruptcy or comparable law.
SECTION 7.08 Replacement of Trustee.
----------------------
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section 7.08.
The Trustee may resign with respect to any series of Securities by so
notifying the Company. The Holders of a majority in principal amount of the
Securities of any series then outstanding may remove the Trustee with respect to
such series of Securities by so notifying the Trustee and may appoint a
successor Trustee with respect to such series of Securities with the Company's
written consent. The Company may remove the Trustee with respect to any series
of Securities (or, if clause (4) applies, with respect to all series) if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a receiver or other public officer takes charge of the
Trustee or its property; or
(4) the Trustee otherwise becomes incapable of acting with
respect to any series of Securities.
If the Trustee resigns or is removed with respect to any series of
Securities or if a vacancy exists in the office of Trustee with respect to any
series of Securities for any reason, the Company shall promptly appoint a
successor Trustee with respect to such series.
If a successor Trustee with respect to any series of Securities does
not take office within 45 days after the retiring Trustee with respect to such
series resigns or is removed, the retiring Trustee, the Company or the Holders
of a
-34-
majority in principal amount of the Securities of such series then
outstanding may petition any court of competent jurisdiction for the appointment
of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
-35-
A successor Trustee shall deliver a written acceptance of its
appointment with respect to any series of Securities to the retiring Trustee and
to the Company. Immediately after that, the retiring Trustee shall, upon
payment of its fees and expenses, transfer all property held by it as Trustee
with respect to such series to the successor Trustee, subject to the lien
provided for in Section 7.07, the resignation or removal of the retiring Trustee
shall become effective with respect to such series, and the successor Trustee
shall have all the rights, powers and duties of the Trustee under this Indenture
with respect to such series. Notwithstanding the replacement of the Trustee
with respect to any series of Securities pursuant to this Section 7.08, the
Company's obligations under Section 7.07 shall continue for the benefit of the
retiring Trustee with respect to expenses and liabilities incurred by it and
compensation earned by it prior to such replacement or otherwise with respect to
the Securities of such series or the Indenture. A successor Trustee with
respect to any series of Securities shall mail notice of its succession to each
Holder of Securities of such series.
SECTION 7.09 Successor Trustee by Merger, etc.
---------------------------------
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust assets to, another
corporation, the successor corporation without any further act shall be the
successor Trustee.
SECTION 7.10 Eligibility; Disqualification.
-----------------------------
This Indenture shall always have a Trustee who satisfies the
requirements of TIA (S) 310(a)(1). The Trustee shall have a combined capital
and surplus of at least $50,000,000 as set forth in its most recent published
annual report of condition. The Trustee shall comply with TIA (S) 310(b),
including the optional provision permitted by the second sentence of TIA
(S) 310(b)(9).
SECTION 7.11 Preferential Collection of Claims Against Company.
-------------------------------------------------
The Trustee is subject to TIA (S) 311(a), excluding any creditor
relationship listed in TIA (S) 311(b). A Trustee who has resigned or been
removed shall be subject to TIA (S) 311(a) to the extent indicated therein.
ARTICLE 8
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 8.01 Satisfaction, Discharge and Defeasance of the
---------------------------------------------
Securities.
----------
The Company shall be deemed to have paid and discharged the entire
indebtedness on the Securities of any series
-36-
after the date of the deposit referred to in paragraph (a) below, the provisions
of this Indenture shall no longer be in effect in respect of the Securities of
such series, and the Trustee, at the expense of the Company, shall execute
proper instruments acknowledging satisfaction and discharge of such
indebtedness; provided that the following conditions shall have been satisfied:
--------
(a) the Company has deposited or caused to be deposited
with the Trustee irrevocably as trust funds in trust,
specifically pledged as security for, and dedicated solely to,
the benefit of the Holders of all Securities of such series, with
reference to this Section 8.01, (i) money or (ii) U.S. Government
Obligations or (iii) 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 and discharge the entire
indebtedness on all the Securities of such series for principal,
premium, if any, and interest, if any, to the maturity date of
such series of Securities as such principal, premium, if any, or
interest becomes due and payable in accordance with the terms of
this Indenture and the Securities;
(b) the Company has paid or caused to be paid all other
sums payable hereunder by the Company in connection with all of
the Securities of any series, including all fees and expenses of
the Trustee; and
(c) the Company has delivered to the Trustee an Officers'
Certificate stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of the
entire indebtedness on the Securities and the discharge of this
Indenture and the termination of the Company's obligations
hereunder have been complied with.
-37-
"U.S. Government Obligations" means direct, non-callable
obligations of, or non-callable obligations guaranteed by, the United States of
America for the timely payment of which obligation or guarantee the full faith
and credit of the United States of America is pledged.
SECTION 8.02 Satisfaction and Discharge of Indenture.
---------------------------------------
In addition to its rights under Section 8.01, the Company may
terminate all of its obligations under this Indenture when:
(a) All of the Securities of each series theretofore
authenticated and delivered (other than (A) Securities which have been
destroyed, lost or stolen and which have been replaced or paid as
provided in Section 2.07 hereof and (B) Securities for whose payment
money has theretofore been deposited with the Trustee or the Paying
Agent in trust or segregated and held in trust by the Company and
thereafter repaid to the Company or discharged from such trust, as
provided in Section 2.05 and Section 8.06 hereof) have been delivered
to the Trustee for cancellation; and
-38-
(b) the Company has paid or caused to be paid all other sums
payable hereunder by the Company in connection with the outstanding
Securities, including all fees and expenses of the Trustee.
SECTION 8.03 Survival of Certain Obligations.
-------------------------------
Notwithstanding the satisfaction and discharge of this Indenture
pursuant to Section 8.01, the respective obligations of the Company specified in
Sections 2.04, 2.05, 2.06, 2.07, 2.12, 4.01, 7.07, 8.05, 8.06, 8.07 and in
Article 10 shall survive until the Securities are no longer outstanding, and
after the Securities are no longer outstanding, or upon compliance with Section
8.02, only the obligations of the Company in such Sections 7.07 and 8.06 shall
survive. Nothing contained in this Article Eight shall abrogate any of the
obligations or duties of the Trustee under this Indenture.
SECTION 8.04 Application of Trust Money.
--------------------------
(a) Subject to the provisions of Section 8.06, all money and U.S.
Government Obligations deposited with the Trustee for the Securities of any
series pursuant to Section 8.01 or Section 8.02, and all money received by the
Trustee in respect of U.S. Government Obligations deposited with the Trustee for
the Securities of any series pursuant to Section 8.01 or Section 8.02 shall be
held in trust and reinvested by the Trustee in U.S. Government Obligations in
accordance with the Company's written instructions and applied by the Trustee in
accordance with the provisions of the Securities of such series and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal, premium, if any,
and interest, if any, on the Securities of such series; but such money need not
be segregated from other funds except to the extent required by law.
-39-
(b) The Trustee shall deliver or pay to the Company from time to time
upon the Company's written request any U.S. Government Obligations, or money
held by it as provided in Section 8.01 or Section 8.02 which, in the written
opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee, are then
in excess of the amount thereof which then would have been required to be
deposited for the purpose for which such U.S. Government Obligations, or money
were deposited or received.
SECTION 8.05 Paying Agent to Repay Monies Held.
---------------------------------
Upon the satisfaction and discharge of this Indenture with respect to
the Securities of any series, all monies then held by any Paying Agent for the
benefit of Securities of such series under the provisions of this Indenture
shall, upon written demand of the Company, 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 monies.
SECTION 8.06 Return of Unclaimed Monies.
--------------------------
Any monies deposited with or paid to the Trustee or any Paying Agent
for the Securities of any series, or then held by the Company in trust, for the
payment of any principal, premium, if any, and interest, if any, on the
Securities of any series and not applied but remaining unclaimed by the Holders
of the Securities of such series for two years after the date upon which the
principal of and interest, if any, on the Securities of such series, as the case
may be, shall have become due and payable, shall, unless otherwise required by
mandatory provisions of applicable escheat or abandoned or unclaimed property
law, be repaid to the Company by such Trustee or any Paying Agent on written
demand by the Company or (if then held by the Company) shall be discharged from
such trust; and the Holders of the Securities of such series entitled to receive
such payment shall thereafter look only to the Company for the payment thereof;
provided, however, that, before being required to make any such repayment, such
-------- -------
Trustee may, or shall at the written request of the Company, at the expense of
the Company, cause to be published once in an authorized newspaper in the same
city in which the place of payment with respect to the Securities of such series
shall be located and in an authorized newspaper in the City of New York, or mail
to each such Holder, a notice (in such form as may be deemed appropriate by such
Trustee) that said monies remain unclaimed and that, after a date named therein,
any unclaimed balance of said monies then remaining will be returned to the
Company.
SECTION 8.07 Reinstatement.
-------------
If the Trustee or Paying Agent is unable to apply any money or U.S.
Government Obligations with respect to the Securities of any series in
accordance with Section 8.01 by reason of any legal proceeding or by reason of
any order or judgment of
-40-
any court or governmental authority enjoining, restraining or otherwise
prohibiting such application, the Company's obligations under this Indenture and
the Securities of such series shall be revived and reinstated as though no
deposit had occurred pursuant to Section 8.01 until such time as the Trustee or
Paying Agent is permitted to apply all such money or U.S. Government Obligations
in accordance with Section 8.04; provided, however, that if the Company has made
-------- -------
any payment of interest on or principal of any Securities of any series because
of the reinstatement of its obligations, the Company shall be subrogated to the
rights of the Holders of such Securities to receive such payment from the money
or U.S. Government Obligations held by the Trustee or Paying Agent.
ARTICLE 9
SUPPLEMENTAL INDENTURES
SECTION 9.01 Supplemental Indentures Without Consent of Holders.
--------------------------------------------------
The Company, when authorized by Board Resolution, and the Trustee at
any time and from time to time, may amend this Indenture or enter into one or
more indentures supplemental hereto, to be in a form satisfactory to the Trustee
without notice to or consent of any Securityholder for any of the following
purposes:
(1) to comply with Section 5.01; or
(2) to provide for uncertificated Securities in addition to or in
place of certificated Securities; or
(3) to add to the covenants of the Company, for the benefit of the
Holders of all or any series of Securities (and if such covenants are
to be for the benefit of less than all series of Securities, stating
that such covenants are expressly being included solely for the
benefit of such series), or to surrender any right or power herein
conferred upon the Company; or
(4) to add any Events of Default (and if such Events of Default are
to be applicable to less than all series of Securities, stating that
such Events of Default are expressly being included solely to be
applicable to such series); or
(5) to change or eliminate any of the provisions of this Indenture,
provided that any such change or elimination shall become effective
only when there is no Security outstanding of any series created prior
to the execution of such supplemental indenture which is entitled to
the benefit of such provision; or
(6) to establish the form or terms of Securities of
-41-
any series as permitted by Sections 2.01 and 2.02; or
(7) to cure any ambiguity, to correct or supplement any provision
herein which may be defective or inconsistent with any other provision
herein, or to make any other provisions with respect to matters or
questions arising under this Indenture which shall not be inconsistent
with any provision of this Indenture, provided such other provisions
shall not adversely affect the interests of the Holders of Securities
of any series in any material respect.
SECTION 9.02 Supplemental Indentures with Consent of Holders.
-----------------------------------------------
With the written consent of the Holders of not less than a majority in
aggregate principal amount of the Securities of each series at the time
outstanding affected by such supplemental indenture, the Company, when
authorized by Board Resolution, and the Trustee may amend this Indenture or 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 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, except as otherwise permitted
by Section 9.01, or of modifying in any manner the rights of the Holders of the
Securities of each such series. Subject to Section 9.04, without the consent of
each Holder of Securities of any series affected, however, an amendment,
supplement or waiver, including a waiver pursuant to Section 6.04, may not:
(1) extend the fixed maturity of any Securities, or reduce the
principal amount thereof or premium, if any, or reduce the rate or
extend the time of payment of interest thereon, without the consent of
the Holder of each Security so affected;
(2) reduce the aforesaid percentage of Securities of each series, the
consent of the Holders of which is required for any such supplemental
indenture, without the consent of the Holders of all Securities then
outstanding affected thereby;
(3) waive (except, unless theretofore cured) a default in the payment
of the principal of (and premium, if any on), interest on or
redemption amounts with respect to any Security;
(4) make any Security payable in money other than that stated in the
Security;
(5) make any change in Sections 6.04, 6.06 or 9.02 (this sentence);
(6) make any change that adversely affects the right
-42-
to convert any Security; or
(7) make any change in Article 11 that adversely affects the rights
of any Securityholder.
Upon the request of the Company, accompanied by a copy of a Board
Resolution certified by the Secretary or an Assistant Secretary of the Company
authorizing the execution of any such supplemental indenture, and upon the
filing with the Trustee of evidence of the consent of Securityholders as
aforesaid, the Trustee shall join with the Company 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 in 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 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent shall approve
the substance thereof.
Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section, the Company
shall mail a notice, setting forth in general terms the substance of such
supplemental indenture, to all Holders of Securities of each series so affected
as the names and addresses of such Holders shall appear on the registry books.
Any failure of the Company so to mail such notice, or any defect therein, shall
not, however, in any way impair or affect the validity of any such supplemental
indenture.
SECTION 9.03 Compliance with Trust Indenture Act.
-----------------------------------
Every amendment or supplement to this Indenture or the Securities
shall comply with the TIA as then in effect.
SECTION 9.04 Revocation and Effect of Consents.
---------------------------------
Subject to this Indenture, each amendment, supplement or waiver
evidencing other action shall become effective in accordance with its terms.
Until an amendment, supplement or waiver becomes effective, a consent to it by a
Holder of a Security of any series is a continuing consent by the Holder even if
notation of the consent is not made on any Security. Any such Holder or
subsequent Holder, however, may revoke the consent as to his Security or portion
of a Security, if the Trustee receives the notice of revocation before the date
the amendment, waiver or other action becomes effective.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver. If a record date is fixed, then notwithstanding the
provisions of the immediately preceding paragraph, those Persons who were
Holders at such record
-43-
date (or their duly designated proxies) and only those Persons, shall be
entitled to consent to such amendment, supplement or waiver or to revoke any
consent previously given, whether or not such Persons continue to be Holders
after such record date. No consent shall be valid or effective for more than 90
days after such record date unless consent from Holders of the principal amount
of Securities of any series then outstanding required hereunder for such
amendment, supplement or waiver to be effective shall have also been given and
not revoked within such 90-day period.
-44-
After an amendment, supplement or waiver becomes effective, it shall
bind every Securityholder, unless it makes a change described in any of clauses
(1) through (6) of Section 9.02. In that case the amendment, supplement or
waiver shall only bind the Holders of a Security or portion of a Security of the
same series.
SECTION 9.05 Notation on or Exchange of Securities.
-------------------------------------
If an amendment, supplement or waiver changes the terms of a Security
of any series, the Trustee may request the Holder of the Security of such series
to deliver it to the Trustee. The Trustee may place an appropriate notation on
the Security about the changed terms and return it to the Holder.
Alternatively, if the Company or the Trustee so determine, the Company in
exchange for the Security of such series shall issue and the Trustee shall
authenticate a new Security of such series that reflects the changed terms the
cost and expense of which will be borne by the Company.
SECTION 9.06 Effect of Supplemental Indentures.
---------------------------------
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities of any applicable series theretofore or thereafter authenticated
and delivered hereunder shall be bound thereby.
SECTION 9.07 Reference in Securities to Supplemental Indentures.
--------------------------------------------------
Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may, and shall
if required by the Trustee, bear a notation in form approved by the Trustee as
to any matter provided for in such supplemental indenture. If the Company shall
so determine, new Securities of any series so modified as to conform, in the
opinion of the Trustee and the Board of Directors of the Company, to any such
supplemental indenture may be prepared and executed by the Company and
authenticated and delivered by the Trustee in exchange for Securities
outstanding of such series.
ARTICLE 10
CONVERSION OF SECURITIES
SECTION 10.01 Right of Conversion; Conversion Price.
-------------------------------------
If provided in the Board Resolution or Supplemental Indenture with
respect to such series of Securities, the Holder of any Security or Securities
of a particular series shall have the right, at his option, at any time after
such date as determined by such Board Resolution and before the close of
business on such date as determined by such Board Resolution (except that, with
-45-
respect to any Security or portion of a Security of such series which shall be
called for redemption, such right shall terminate at the close of business on
the date fixed for redemption of such Security or portion of a Security unless
the Company shall default in payment due upon redemption thereof), to convert,
subject to the terms and provisions of this Article 10, the principal of any
Security or Securities of such series or any portion thereof which is $1,000
principal amount or an integral multiple thereof into shares of common stock of
the Company or Securities of another series of Securities, initially at the
conversion price per share specified in the Securities of such series; or, in
case an adjustment of such price has taken place pursuant to the provisions of
Section 10.04, then at the price as last adjusted (such price or adjusted price
being referred to herein as the "conversion price"), upon surrender of the
Security or Securities, the principal of which is so to be converted,
accompanied by written notice of conversion duly executed, to the Company, at
any time during usual business hours at the office or agency maintained by it
for such purpose, and, if so required by the Conversion Agent or Registrar,
accompanied by a written instrument or instruments of transfer in form
satisfactory to the Conversion Agent or Registrar duly executed by the Holder or
his duly authorized representative in writing. For convenience, the conversion
of any portion of the principal of any Security or Securities into shares of
common stock of the Company or other Securities is hereinafter sometimes
referred to as the conversion of such Security or Securities.
SECTION 10.02 Issuance of Shares on Conversion.
--------------------------------
As promptly as practicable after the surrender, as herein provided, of
any Security or Securities of any series for conversion, the Company shall
deliver or cause to be delivered at its said office or agency, to or upon the
written order of the Holder of the Security or Securities so surrendered,
certificates representing the number of fully paid and nonassessable shares of
common stock of the Company or Securities of another series of the Company into
which such Security or Securities may be converted in accordance with the
provisions of this Article 10. Such conversion shall be deemed to have been
made as of the close of business on the date that such Security or Securities
shall have been surrendered for conversion by delivery thereof with a written
notice of conversion duly executed, so that the rights of the Holder of such
Security or Securities as a Securityholder shall cease at such time and, subject
to the following provisions of this paragraph, the Person or Persons entitled to
receive the shares of common stock or Securities of another series upon
conversion of such Security or Securities shall be treated for all purposes as
having become the record holder or holders of such shares of common stock or
Securities of another series at such time and such conversion shall be at the
conversion price in effect at such time; provided, however, that with respect to
-------- -------
shares of the Company's common stock, no such surrender on any date when the
stock transfer books of the Company shall be closed shall be effective to
constitute the Person or Persons entitled to
-46-
receive the shares of common stock upon such conversion as the record holder or
holders of such shares of common stock on such date, but such surrender shall be
effective to constitute the Person or Persons entitled to receive such shares of
common stock as the record holder or holders thereof for all purposes at the
close of business on the next succeeding day on which such stock transfer books
are open; such conversion shall be at the conversion price in effect on the date
that such Security or Securities shall have been surrendered for conversion by
delivery thereof, as if the stock transfer books of the Company had not been
closed. The Company shall give or cause to be given to the Trustee written
notice whenever the stock transfer books of the Company shall be closed.
-00-
Xxxx Xxxxxxxxxx of any Security of any series which is converted in
part only, the Company shall execute and the Trustee shall authenticate and
deliver to or on the order of the Holder thereof, at the expense of the Company,
a new Security or Securities of such series of authorized denominations in
principal amount equal to the unconverted portion of such Security.
SECTION 10.03 No Adjustment for Interest or Dividends.
---------------------------------------
No payment or adjustment in respect of interest on the Securities of
any series or dividends on the shares of common stock shall be made upon the
conversion of any Security or Securities; provided, however, that if a Security
-------- -------
of any series or any portion thereof shall be converted subsequent to any
regular record date and on or prior to the next succeeding interest payment
date, the interest falling due on such interest payment date shall be payable on
such interest payment date notwithstanding such conversion, and such interest
(whether or not punctually paid or duly provided for) shall be paid to the
Person in whose name such Security is registered at the close of business on
such regular record date and Securities surrendered for conversion during the
period from the close of business on any regular record date to the opening of
business on the corresponding interest payment date must be accompanied by
payment of an amount equal to the interest payable on such interest payment
date.
SECTION 10.04 Adjustment of Conversion Price.
------------------------------
(1) With respect to any series of Securities that is convertible into
shares of the Company's common stock, in case the Company shall pay or make a
dividend or other distribution on any class of Capital Stock of the Company in
shares of common stock, the conversion price for any series of Securities in
effect at the opening of business on the day following the date fixed for the
determination of shareholders entitled to receive such dividend or other
distribution shall be reduced by multiplying such conversion price by a fraction
of which the numerator shall be the number of shares of common stock outstanding
at the close of business on the date fixed for such determination and the
denominator shall be the sum of such number of shares and the total number of
shares constituting such dividend or other distribution, such reduction to
become effective immediately after the opening of business on the day following
the date fixed for such determination.
(2) With respect to any series of Securities that is convertible into
shares of the Company's common stock, in case the Company shall issue rights or
warrants to all or substantially all holders of its shares of common stock
entitling them to subscribe for or purchase shares of common stock at a price
per share (or having a conversion price per share) less than the current market
price per share (determined as provided in paragraph (6) of this Section) of the
shares of common stock on the date fixed for the determination of shareholders
entitled to receive such rights or warrants, the conversion price for any series
of Securities in
-48-
effect at the opening of business on the day following the date fixed for such
determination shall be reduced by multiplying such conversion price by a
fraction of which the numerator shall be the number of shares of common stock
outstanding at the close of business on the date fixed for such determination
plus the number of shares of common stock which the aggregate of the
subscription price of the total number of shares of common stock so offered for
subscription or purchase would purchase at such current market price and the
denominator shall be the number of shares of common stock outstanding at the
close of business on the date fixed for such determination plus the number of
shares of common stock so offered for subscription or purchase, such reduction
to become effective immediately after the opening of business on the day
following the date fixed for such determination. In the event that all of the
shares of common stock subject to such rights or warrants have not been issued
when such rights or warrants expire, then the conversion price shall promptly be
readjusted to the conversion price which would then be in effect had the
adjustment upon the issuance of such rights or warrants been made on the basis
of the actual number of shares of common stock issued upon the exercise of such
rights or warrants. For the purposes of this paragraph (2), the number of shares
of common stock at any time outstanding shall not include shares held in the
treasury of the Company but shall include shares issuable in respect of scrip
certificates issued in lieu of fractions of shares of common stock. The Company
will not issue any rights or warrants in respect of shares of common stock held
in the treasury of the Company.
(3) With respect to any series of Securities that is convertible into
shares of the Company's common stock, in case the outstanding shares of common
stock shall be subdivided into a greater number of shares, the conversion price
for any series of Securities in effect at the opening of business on the day
following the day upon which such subdivision becomes effective shall be
proportionately reduced, and, conversely, in case outstanding shares of common
stock shall each be combined into a smaller number of shares, the conversion
price for any series of Securities in effect at the opening of business on the
day following the day upon which such combination becomes effective shall be
proportionately increased, such reduction or increase, as the case may be, to
become effective immediately after the opening of business on the day following
the day upon which such subdivision or combination becomes effective.
(4) With respect to any series of Securities that is convertible into
shares of the Company's common stock, in case the Company shall, by dividend or
otherwise, distribute to all or substantially all holders of shares of common
stock evidences of indebtedness or assets (including securities, but excluding
(i) any rights or warrants referred to in paragraph (2) of this Section, (ii)
any dividend or distribution not prohibited by Section 4.06 hereof and (iii) any
dividend or distribution referred to in paragraph (1) of this Section), the
conversion price for any series of Securities shall be adjusted so that the
-49-
same shall equal the price determined by multiplying the conversion price in
effect immediately prior to the close of business on the day fixed for the
determination of shareholders entitled to receive such distribution by a
fraction of which the numerator shall be the current market price per share
(determined as provided in paragraph (6) of this Section) of the shares of
common stock on the date fixed for such determination less the then fair market
value as determined by the Board of Directors of the Company (whose
determination shall be conclusive and described in a resolution of the Board of
Directors of the Company filed with the Trustee) of the portion of the assets or
evidences of indebtedness so distributed allocable to one share of common stock
and the denominator shall be such current market price per share of the shares
of common stock, such adjustment to become effective immediately prior to the
opening of business on the day following the date fixed for the determination of
shareholders entitled to receive such distribution.
(5) With respect to any series of Securities that is convertible into
shares of the Company's common stock, in case the shares of common stock shall
be changed into the same or a different number of shares of any class or classes
of stock, whether by capital reorganization, reclassification, or otherwise
(other than a subdivision or combination of shares or a stock dividend described
in paragraph (1) or paragraph (3) of this Section, or a consolidation, merger or
sale of assets described in Section 10.10), then and in each such event the
Holders of Securities of any series shall have the right thereafter to convert
such Securities into the kind and amount of shares of stock and other securities
and property receivable upon such reorganization, reclassification or other
change, by holders of the number of shares of common stock into which such
Securities might have been converted immediately prior to such reorganization,
reclassification or change.
(6) For the purpose of any computation under paragraphs (2) and (4)
of this Section, the current market price per share of common stock on any date
shall be deemed to be the average of the Closing Prices for the 15 consecutive
Business Days selected by the Company commencing not more than 30 and not less
than 20 Business Days before the date in question.
(7) No adjustment in the conversion price for the Securities of any
series shall be required unless such adjustment (plus any adjustments not
previously made by reason of this paragraph (7)) would require an increase or
decrease of at least 1% in such price; provided, however, that any adjustments
which by reason of this paragraph (7) are not required to be made shall be
carried forward and taken into account in any subsequent adjustment. All
calculations under this paragraph (7) shall be made to the nearest cent.
(8) The Company may, but shall not be required to, make such
reductions in the conversion price for the Securities of any series, in addition
to those required by paragraph (1), (2),
-50-
(3) and (4) of this Section, as the Board of Directors of the Company considers
to be advisable in order to avoid or diminish any income tax to any holders of
shares of common stock resulting from any dividend or distribution of stock or
issuance of rights or warrants to purchase or subscribe for stock or from any
event treated as such for income tax purposes or for any other reasons. The
Company's Board of Directors of the Company shall have the power to resolve any
ambiguity or correct any error in the adjustments made pursuant to this
Section 10.04 and its actions in so doing shall be final and conclusive.
(9) The adjustments provided for in this Section 10.04 shall be made
successively whenever any event listed above shall occur.
SECTION 10.05 Notice of Adjustment of Conversion Price.
----------------------------------------
Whenever the conversion price for the Securities of any series is
adjusted as herein provided:
(a) the Company shall compute the adjusted conversion price in
accordance with Section 10.04 and shall prepare an Officers'
Certificate setting forth the adjusted conversion price and showing
the facts upon which such adjustment is based and the computation
thereof, and such certificate shall forthwith be filed at each office
or agency maintained for the purpose of conversion of Securities
pursuant to Section 2.04 and with the Trustee; and
(b) a notice stating that the conversion price has been adjusted
and setting forth the adjusted conversion price shall as soon as
practicable be mailed by the Company to all Holders of Securities of
such series at their last addresses as they shall appear in the
Security Register.
-51-
(c) If the conversion price is adjusted and the Company fails to
file an Officers' Certificate with the Trustee as provided by Section
10.05(a) and the Trustee is acting as the Conversion Agent, the
Trustee shall be entitled to rely conclusively on the conversion price
set forth in the Officer's Certificate most recently received by the
Trustee (or as set forth in this Indenture if the conversion price
shall not have been adjusted).
SECTION 10.06 Notice of Certain Corporate Action.
----------------------------------
(1) In case:
(a) the Company shall authorize the granting to holders of its
shares of common stock of rights or warrants entitling them to
subscribe for or purchase any shares of Capital Stock of any class or
of any other rights; or
(b) of an y reclassification of the shares of common stock of
the Company, or of any consolidation or merger to which the Company is
a party and for which approval of any shareholders of the Company is
required, or of the sale or transfer of all or substantially all of
the assets of the Company; or
(c) of the voluntary or involuntary dissolution, liquidation or
winding up of the Company;
then the Company shall cause to be filed at each office or agency maintained for
the purpose of conversion of Securities of any series pursuant to Section 2.04
and shall cause to be mailed to all Holders of Securities of such series that
are convertible into shares of the Company's common stock at their last
addresses as they shall appear in the Security Register, at least 20 days (or 10
days in any case specified in clause (a) or (b) above) prior to the applicable
record date hereinafter specified, a notice stating (x) the date on which a
record is to be taken for the purpose of such dividend, distribution, rights or
warrants, or, if a record is not to be taken, the date as of which the Holders
of shares of common stock of record to be entitled to such dividend,
distribution, rights or warrants are to be determined, or (y) the date on which
such reclassification, consolidation, merger, sale, transfer, dissolution,
liquidation or winding up is expected to become effective, and the date as of
which it is expected that holders of shares of common stock of record shall be
entitled to exchange their shares of common stock for securities, cash or other
property deliverable upon such reclassification, consolidation, merger, sale,
transfer, dissolution, liquidation or winding up. Such notice shall also state
whether such transaction will result in any adjustment in the conversion price
applicable to the Securities of such series and, if so, shall state what the
adjusted conversion price will be and when it will become effective. Neither
the failure to give the notice required by
-52-
this Section, nor any defect therein, to any particular Holder shall affect the
sufficiency of the notice or the legality or validity of any such dividend,
distribution, right, warrant, reclassification, consolidation, merger, sale,
transfer, liquidation, dissolution or winding-up, or the vote on any action
authorizing such with respect to the other holders.
-53-
(2) In case the Company or any Affiliate of the Company shall propose
to engage in a "Rule 13e-3 Transaction" as defined in the Commission's Rule 13e-
3 under the Exchange Act, the Company shall, no later than the date on which any
information with respect to such Rule 13e-3 Transaction is first required to be
given to the Commission or any other Person pursuant to such Rule 13e-3, cause
to be mailed to all Holders at their last addresses as they shall appear in the
Security Register, a copy of all information required to be given to the holders
of the Company's Capital Stock pursuant to such Rule 13e-3. The information
required to be given under this paragraph shall be in addition to and not in
lieu of any other information required to be given by the Company pursuant to
this Section 10.06 or any other provision of the Securities or this Indenture.
SECTION 10.07 Taxes on Conversions.
--------------------
The Company will pay any and all stamp or similar taxes that may be
payable in respect of the issuance or delivery of shares of common stock or
Securities of another series on conversion of Securities pursuant hereto. The
Company shall not, however, be required to pay any tax which may be payable in
respect of any transfer involved in the issuance and delivery of shares of
common stock in a name other than that of the Holder of the Security or
Securities to be converted, and no such issuance or delivery shall be made
unless and until the Person requesting such issuance has paid to the Company the
amount of any such tax, or has established to the satisfaction of the Company
that such tax has been paid.
SECTION 10.08 Fractional Shares.
-----------------
No fractional shares or scrip representing fractional shares shall be
issued upon any conversion of Securities. If any such conversion would
otherwise require the issuance of a fractional share an amount equal to such
fraction multiplied by the current market price per share of common stock
(determined as provided in paragraph (6) of Section 10.04) on the day of
conversion shall be paid to the Holder in cash by the Company.
SECTION 10.09 Cancellation of Converted Securities.
------------------------------------
All Securities delivered for conversion shall be delivered to the
Trustee or the Conversion Agent to be canceled by or at the direction of the
Trustee or the Conversion Agent, which shall dispose of the same as provided in
Section 2.10.
SECTION 10.10 Provisions in Case of Consolidation, Merger or Sale of Assets.
-------------------------------------------------------------
(1) In case of any consolidation of the Company with, or merger of
the Company into, any other corporation or trust, or in case of any merger of
another corporation or trust into the Company (other than a consolidation or
merger which does not result in any reclassification, conversion, exchange or
-54-
cancellation of outstanding shares of common stock of the Company), or in case
of any sale or transfer of all or substantially all of the assets of the
Company, the corporation or trust formed by such consolidation or resulting from
such merger or which acquires such assets, as the case may be, shall execute and
deliver to the Trustee a supplemental indenture providing that the Holder of
each Security of any series then outstanding shall have the right thereafter,
during the period such Security shall be convertible as specified in Section
10.01 to convert such Security only into the kind and amount of securities, cash
and other property receivable upon such consolidation, merger, sale or transfer
by a holder of the number of shares of common stock of the Company into which
such Security might have been converted immediately prior to such consolidation,
merger, sale or transfer. Such supplemental indenture shall provide for
adjustments which, for events subsequent to the effective date of such
supplemental indenture, shall be as nearly equivalent as may be practicable to
the adjustments provided for in this Article. The above provisions of this
Section shall similarly apply to successive consolidations, mergers, sales or
transfers.
-55-
(2) The Trustee shall not be under any responsibility to determine
the correctness of any provisions contained in any such supplemental indenture
relating either to the kind or amount of shares of stock or securities or
property receivable by Holders upon the conversion of their Securities after any
such reclassification, change, consolidation, merger, sale or conveyance or to
any adjustment to be made with respect thereto.
SECTION 10.11 Disclaimer by Trustee of Responsibility for Certain Matters.
-----------------------------------------------------------
The Trustee shall not at any time be under any duty or responsibility
to any Holder of Securities of any series to determine whether any facts exist
which may require any adjustment of the conversion price for such series, or
with respect to the nature or extent of any such adjustment when made, or with
respect to the method employed, or herein or in any supplemental indenture
provided to be employed, in making the same. The Trustee shall not be
accountable with respect to the validity, value, kind or amount of any shares of
common stock, or of any securities or property, which may at any time be issued
or delivered upon the conversion of any Security; and it makes no representation
with respect thereto. The Trustee shall not be responsible for any failure of
the Company to issue, transfer or deliver any shares of common stock or stock
certificates or other securities or property upon the surrender of any Security
for the purpose of conversion or, subject to Section 7.01, to comply with any of
the covenants of the Company contained in this Article.
SECTION 10.12 Covenant to Reserve Shares.
--------------------------
The Company covenants that it will at all times reserve and keep
available, free from preemptive rights, out of its authorized shares of common
stock, solely for the purpose of issuance upon conversion of Securities as
herein provided, such number of shares of common stock as shall then be issuable
upon the conversion of all outstanding Securities. The Company covenants that
all shares of common stock which shall be so issuable shall be, when issued,
duly and validly issued and fully paid and non-assessable. For purposes of this
Section 10.12, the number of shares of common stock which shall be deliverable
upon the conversion of all outstanding Securities shall be computed as if at the
time of computation all outstanding Securities were held by a single holder.
ARTICLE 11
SUBORDINATION; SENIORITY
SECTION 11.01 Securities Subordinated to Senior Indebtedness.
----------------------------------------------
(a) Securities of any series which by their terms are subordinated
and junior in right of payment of the principal of, premium, if any, and
interest (all of the foregoing, a "Payment or
-56-
Distribution") on such Securities ("Junior Securities") to the prior payment in
full of any Senior Indebtedness whether outstanding on the date hereof or
hereafter created, incurred, assumed or guaranteed, shall comply with the
provisions of this Article 11, and each Holder of Junior Securities of such
series by his acceptance thereof likewise agrees.
A Payment or Distribution shall include any asset of any kind or
character, and may consist of cash, securities or other property, by set-off or
otherwise, and shall include, without limitation, any purchase, redemption or
other acquisition of Junior Securities of the series or the making of any
deposit of funds or securities pursuant to this Indenture (including, without
limitation, any deposit pursuant to Article 8 hereof).
(b) The Senior Indebtedness of the Company shall continue to be
Senior Indebtedness and entitled to the benefit of these subordination
provisions irrespective of any amendment, modification or waiver of any term of
any instrument relating to refinancing of the Senior Indebtedness.
(c) All the provisions of this Indenture and the Junior Securities of
any series shall be subject to the provisions of this Article 11 so far as they
may be applicable thereto, except that nothing in this Article 11 shall apply to
claims for, or payments to, the Trustee under or pursuant to Section 7.07.
(d) No right of any holder of any Senior Indebtedness to enforce
subordination as herein provided shall at any time or in any way be affected or
impaired by any failure to act on the part of the Company, any Paying Agent, the
Holders of the Junior Securities of any series, the Trustee or the holders of
the Senior Indebtedness, or by any noncompliance by the Company, any Paying
Agent, the Holders of the Junior Securities of any series or the Trustee with
any of the terms, provisions and covenants of the Securities or this Indenture,
regardless of any knowledge thereof that any such holder of Senior Indebtedness
may have or be otherwise charged with.
-57-
(e) In the event that the Junior Securities of any series are
declared due and payable before their expressed maturity because of the
occurrence of a default hereunder, the Company will give prompt notice in
writing of such happening to the holders of Senior Indebtedness.
SECTION 11.02 Company Not to Make Payments with Respect to Junior Securities in
-----------------------------------------------------------------
Certain Circumstances.
---------------------
No Payment or Distribution shall be made by the Company, the Trustee
or the Paying Agent on account of principal of (or premium, if any) or interest
on the Junior Securities of any series, whether upon stated maturity, upon
redemption or acceleration, or otherwise, or on account of the purchase or other
acquisition of Junior Securities of such series, whether upon stated maturity,
upon redemption or acceleration, or otherwise, if there shall have occurred and
be continuing a default with respect to any Senior Indebtedness permitting the
acceleration thereof or with respect to the payment of any Senior Indebtedness
and (a) such default is the subject of a judicial proceeding or (b) notice of
such default in writing or by telegram has been given to the Company by any
holder or holders of any Senior Indebtedness, unless and until the Company shall
have received written notice from such holder or holders that such default or
event of default shall have been cured or waived or shall have ceased to exist.
Upon any acceleration of the principal of the Junior Securities of any
series or any payment by the Company or distribution of assets of the Company of
any kind or character, whether in cash, property or securities, to creditors
upon any dissolution or winding up or liquidation or reorganization of the
Company, whether voluntary or involuntary, or in bankruptcy, insolvency,
receivership or other proceedings, all amounts due or to become due upon all
Senior Indebtedness shall first be paid in full in cash, or payment thereof
provided for to the satisfaction of the holders thereof, before any Payment or
Distribution is made on account of the redemption price or principal of (and
premium, if any) or interest on the Junior Securities of such series; and
(subject to the power of a court of competent jurisdiction to make other
equitable provision, which shall have been determined by such court to give
effect to the rights conferred in this Article upon the Senior Indebtedness and
the holders thereof with respect to the Junior Securities of such series or the
Holders thereof or the Trustee, by a lawful plan of reorganization or
readjustment under applicable law) upon any such dissolution or winding up or
liquidation or reorganization, any Payment or Distribution by the Company or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, to which the Holders of the Junior Securities of any
series or the Trustee would be entitled except for the provisions of this
Article, shall be paid by the Company or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other Person making such Payment or Distribution
directly to the holders of Senior Indebtedness of the Company or their
representative or representatives, or to the
-58-
trustee or trustees under any indenture pursuant to which any instruments
evidencing any Senior Indebtedness may have been issued, as their respective
interests may appear, to the extent necessary to pay all Senior Indebtedness in
full in cash, after giving effect to any concurrent payment or distribution to
or for the holders of Senior Indebtedness, before any Payment or Distribution is
made to the Holders of the Securities of such series or to the Trustee, except
that the Trustee will have a lien for the payment of its fees and expenses.
In the event that, notwithstanding the foregoing, any Payment or
Distribution by the Company of any kind or character, whether such payment shall
be in cash, property or securities, prohibited by the foregoing, and the Company
shall have made payment to the Trustee or the Holders of the Junior Securities
of any series before all Senior Indebtedness is paid in full in cash, or
provision is made for such payment to the satisfaction of the holders thereof,
and if such fact shall then have been or thereafter be made known to a Trust
Officer of the Trustee or, as the case may be, such Holder, then and in such
event such Payment or Distribution shall be paid over by the Trustee (if the
Notice required by Section 11.05 has been received by the Trustee) or such
Holder or delivered to the holders of Senior Indebtedness or their
representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing any Senior Indebtedness
may have been issued, as their respective interests may appear, for application
to the payment of all Senior Indebtedness remaining unpaid to the extent
necessary to pay all Senior Indebtedness in full in cash, after giving effect to
any concurrent Payment or Distribution to or for the holders of such Senior
Indebtedness, and, until so delivered, the same shall be held in trust by any
Holder of a Junior Security as the property of the holders of Senior
Indebtedness.
The consolidation of the Company with, or the merger of the Company
into, another Person or the liquidation or dissolution of the Company following
the conveyance or transfer of its property as an entirety, or substantially as
an entirety, to another corporation upon the terms and conditions provided in
Article Five shall not be deemed a dissolution, winding up, liquidation or
reorganization for the purposes of this Section if such other Person shall, as a
part of such consolidation, merger, conveyance or transfer, comply with the
conditions stated in Article Five. Nothing in this Section shall apply to
claims of, or payments to, the Trustee under or pursuant to Section 7.07.
-59-
The holders of Senior Indebtedness may, at any time and from time to
time, without the consent of or notice to the Holders of the Junior Securities
of any series, without incurring responsibility to the Holders of the Junior
Securities of such series and without impairing or releasing the obligations of
the Holders of the Junior Securities of such series hereunder to the holders of
Senior Indebtedness: (i) change the manner, place or terms of payment or change
or extend the time of payment of, or renew or alter, Senior Indebtedness, or
otherwise amend in any manner Senior Indebtedness or any instrument evidencing
the same or any agreement under which Senior Indebtedness is outstanding; (ii)
sell, exchange, release or otherwise deal with any property pledged, mortgaged
or otherwise securing Senior Indebtedness; (iii) release any Person liable in
any manner for the collection of Senior Indebtedness; and/or (iv) exercise or
refrain from exercising any rights against the Company and any other Person.
SECTION 11.03 Subrogation of Junior Securities.
--------------------------------
Subject to the payment in full in cash of all amounts then due
(whether by acceleration of the maturity thereof or otherwise) on account of all
Senior Indebtedness at the time outstanding, the Holders of the Junior
Securities of any series shall be subrogated to the rights of the holders of
Senior Indebtedness to receive Payments or Distributions of cash, property or
securities of the Company applicable to the Senior Indebtedness until the
principal of (and premium, if any) and interest on the Securities shall be paid
in full; and, for the purposes of such subrogation, no Payments or Distributions
to the holders of Senior Indebtedness to which the Holders of the Junior
Securities of any series or the Trustee would be entitled except for the
provisions of this Article, and no payments over pursuant to the provisions of
this Article to the holders of Senior Indebtedness by Holders of the Junior
Securities of any series or the Trustee, shall, as between the Company, the
Company's creditors other than holders of Senior Indebtedness, and the Holders
of the Junior Securities of such series, be deemed to be a payment by the
Company to or on account of the Senior Indebtedness. It is understood that the
provisions of this Article are and are intended solely for the purpose of
defining the relative rights of the Holders of the Junior Securities of any
series, on the one hand, and the holders of Senior Indebtedness, on the other
hand.
Nothing contained in this Article or elsewhere in this Indenture or in
the Securities is intended to or shall impair, as among the Company, its
creditors other than the holders of Senior Indebtedness, and the Holders of the
Securities of each series, the obligation of the Company, which is absolute and
unconditional, to pay to the Holders of the Securities of any series the
principal of (and premium, if any) and interest on the Securities of such series
as and when the same shall become due and payable in accordance with their
terms, or is intended to or shall affect the relative rights of the Holders of
the Junior Securities of any series and creditors of the Company other than
-60-
the holders of Senior Indebtedness, nor shall anything herein or therein prevent
the Trustee or the Holder of any Junior Security of any series from exercising
all remedies otherwise permitted by applicable law upon default under this
Indenture, subject to the rights, if any, under this Article of the holders of
Senior Indebtedness in respect of cash, property or securities of the Company
received upon the exercise of any such remedy.
-61-
Upon any payment or distribution of assets of the Company referred to
in this Article, the Trustee, subject to the provisions of Section 7.01, and the
Holders of the Junior Securities of any series shall be entitled to rely upon
any order or decree made by any court of competent jurisdiction in which any
dissolution, winding up, liquidation or reorganization proceedings are pending,
or certificate of the receiver, trustee in bankruptcy, liquidating trustee,
agent or other Person making such payment or distribution, delivered to the
Trustee or to the Holders of the Junior Securities of such series, for the
purpose of ascertaining the Persons entitled to participate in such
distribution, the holders of Senior Indebtedness and other indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article.
SECTION 11.04 Authorization by Holders of Junior Securities.
---------------------------------------------
Each holder of a Junior Security of any series by his acceptance
thereof authorizes and directs the Trustee on his behalf to take such action as
may be necessary or appropriate to effectuate, as between the Holder of the
Junior Security and the holders of Senior Indebtedness, the subordination
provided in this Article and appoints the Trustee his attorney-in-fact for any
and all such purposes including, without limitation, to execute, verify, deliver
and file any proofs of claim which any holder of Senior Indebtedness may at any
time require in order to prove and realize upon any rights or claims pertaining
to the Securities and to effectuate the full benefit of the subordination
contained herein. Upon failure of the Trustee so to do, any such holder of
Senior Indebtedness shall be deemed to be irrevocably appointed the agent and
attorney-in-fact of the Holder to execute, verify, deliver and file any such
proofs of claim.
SECTION 11.05 Notices to Trustee.
------------------
The Company shall give prompt written notice to the Trustee of any
fact known to it which would prohibit the making of any payment of moneys to or
by the Trustee in respect of the Junior Securities of any series pursuant to the
provisions of this Article. Notwithstanding the provisions of this Article or
any other provision of this Indenture, the Trustee shall not 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 in respect of the Junior Securities of
any series pursuant to the provisions of this Article, unless and until a Trust
Officer of the Trustee shall have received at its Corporate Trust Office written
notice thereof from the Company or a holder or holders of Senior Indebtedness or
from any trustee or agent therefor; and, prior to the receipt of any such
written notice, the Trustee, subject to the provisions of Section 7.01, shall be
entitled in all respects to assume that no such facts exist; provided, however,
-------- -------
that if a Trust Officer of the Trustee shall not have received at least three
Business Days prior to the date upon which by the terms hereof any such moneys
may become payable for any
-62-
purpose (including, without limitation, the payment of the principal of
(premium, if any) or interest on any Junior Security of any series) with respect
to such moneys the notice provided for in this Section, then, anything herein
contained to the contrary notwithstanding, the Trustee shall have the full power
and authority to receive such moneys and to apply the same to the purpose for
which they were received and shall not be affected by any notice to the contrary
which may be received by it within three Business Days prior to such date.
The Trustee shall be entitled to rely conclusively on the delivery to
it of a written notice by a Person representing himself to be a holder of Senior
Indebtedness (or a trustee on behalf of such holder) to establish that such
notice has been given by a holder of Senior Indebtedness or a trustee or agent
on behalf of any such holder. In the event that the Trustee determines in good
faith that further evidence is required with respect to the right of any Person
as a holder of Senior Indebtedness to participate in any payment or distribution
pursuant to this Article, the Trustee may request such Person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of
Senior Indebtedness held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Article, 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 11.06 Trustee's Relation to Senior Indebtedness.
-----------------------------------------
The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article in respect of any Senior Indebtedness at any
time held by it, to the same extent as any other holder of Senior Indebtedness,
and nothing in Section 7.11 or elsewhere in this Indenture shall deprive the
Trustee of any of its rights as such holder.
-63-
With respect to the holders of Senior Indebtedness, the Trustee
undertakes to perform or to observe only such of its covenants and obligations
as are specifically set forth in this Article, and no implied covenants or
obligations with respect to the holders of Senior Indebtedness shall be read
into this Indenture against the Trustee. The Trustee shall not owe any
fiduciary duty to the holders of Senior Indebtedness and shall not be liable to
any such holder if it shall mistakenly pay over or distribute to Holders of the
Junior Securities of any series or the Company or any other Person money or
assets to which any holder of Senior Indebtedness shall be entitled by virtue of
this Article or otherwise.
SECTION 11.07 No Impairment of Subordination.
------------------------------
No right of any present or future holder 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 Company,
the Trustee or the Holder of any of the Securities of any series or by any act,
or failure to act, in good faith, by any such holder of Senior Indebtedness, or
by any noncompliance by the Company, the Trustee or the Holder of any of the
Securities of any series with the terms, provisions and covenants of this
Indenture, regardless of any knowledge thereof which any such holder may have or
otherwise be charged with.
SECTION 11.08 Article 11 Not To Prevent Events of Default.
-------------------------------------------
The failure to make a payment on account of principal of (premium, if
any) or interest on the Junior Securities of any series by reason of any
provision in this Article 11 shall not be construed as preventing the occurrence
of an Event of Default with respect to such series under Section 6.01.
SECTION 11.09 Paying Agents other than the Trustee.
------------------------------------
In any case at any time any Paying Agent other than the Trustee shall
have been appointed by the Company and be then acting hereunder, the term
"Trustee" as used in this Article 11 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 such Paying
Agent were named in this Article 11 in addition to or in place of the Trustee.
SECTION 11.10 Securities Senior to Subordinated Indebtedness.
----------------------------------------------
The indebtedness represented by the Securities of any series will be
senior and prior in right of payment to all Subordinated Indebtedness, to the
extent and in the manner provided in such Subordinated Indebtedness.
-64-
ARTICLE 12
SINKING FUND
SECTION 12.01 Mandatory and Optional Sinking Fund Payments.
--------------------------------------------
The provisions of this Article shall be applicable to any sinking fund
for the retirement of Securities of any series, except as otherwise permitted or
required by any form of Security of a series issued pursuant to this Indenture.
The minimum amounts of any sinking fund payments provided for by the
terms of Securities of any series are herein referred to as "mandatory sinking
fund payments", and any payments in excess of those minimum amounts provided for
by the terms of Securities of that series are herein referred to as "optional
sinking fund payments". If provided for by the terms of the Securities of any
series, the cash amount of any sinking fund payment may be subject to reduction
as provided in Section 12.02. Each sinking fund payment shall be applied to the
redemption of Securities of any series as provided for by the terms of
Securities of that series.
SECTION 12.02 Satisfaction of Sinking Fund Payments with Securities.
-----------------------------------------------------
The Company may, in satisfaction of all or any part of any sinking
fund payment with respect to the Securities of any series, as provided for by
the terms of that series (1) deliver to the Holders of outstanding Securities of
that series (other than any of such Securities previously called for redemption
or any of such Securities by mandatory sinking fund payment in respect of which
cash shall have been released to the Company), (2) apply as a credit Securities
of that series which have been redeemed either at the election of the Company
pursuant to the terms of that series of Securities or through the application of
permitted optional sinking fund payments pursuant to the terms of such
Securities, provided that no Securities of such series have been previously so
credited and (3) apply as a credit Securities of that series which have been
converted or exchanged into shares of the Company's common stock or Securities
of another series pursuant to the terms of that series of Securities, provided
that such series of Securities have not been previously so credited. Such
Securities shall be received and credited for such purpose by the Trustee at the
Redemption Price specified in such Securities for redemption through operation
of the sinking fund and the amount of such sinking fund payment shall be reduced
accordingly. If as a result of the delivery or credit of Securities of any
series in lieu of cash payments pursuant to this Section, the principal amount
of Securities of that series to be redeemed in order to exhaust the aforesaid
cash payment shall be less than $100,000, the Trustee need not call Securities
of that series for redemption, except upon the request of the Company, and such
cash payment shall be held by the Trustee or a Paying Agent and applied to the
next succeeding sinking fund payment, provided, however, that the Trustee or
such Paying Agent shall at the request of the Company from time to time pay over
and deliver to the Company any
-65-
cash payment so being held by the Trustee or such Paying Agent upon delivery by
the Company to the Trustee of Securities of that series purchase by the Company
having an unpaid principal amount equal to the cash payment requested to be
released to the Company.
SECTION 12.03 Redemption of Securities for Sinking Funds.
------------------------------------------
Not less than 60 days prior to each mandatory sinking fund payment
date for any series of Securities, the Company will deliver to the Trustee an
Officers' Certificate specifying the amount of the mandatory sinking fund
payment for that series pursuant to the terms of that series, the portion
thereof, if any, which is to be satisfied by payment of cash and the portion
thereof, if any, which is to be satisfied by delivery or credit of Securities
pursuant to Section 12.02 hereof, and the optional amount, if any, to be added
in cash to the mandatory sinking fund payment, and will also deliver to the
Trustee any Securities to be so credited and not theretofore delivered. If such
Officers' Certificate shall specify an optional amount to be added in cash to
the mandatory sinking fund payment, the Company shall thereupon be obligated to
pay the amount therein specified. Not less than 30 days before each such
sinking fund payment date the Trustee shall select the Securities to be redeemed
upon such sinking fund payment date in the manner specified in Section 3.02
hereof and cause notice of the redemption thereof to be given in the name of and
at the expense of the Company in the manner provided in Section 3.03 hereof.
ARTICLE 13
MISCELLANEOUS
SECTION 13.01 Trust Indenture Act Controls.
----------------------------
If any provision of this Indenture limits, qualifies or conflicts with
another provision which is required to be included in this Indenture by the TIA,
the required provisions shall control.
SECTION 13.02 Notices.
-------
Any notices or other communications required or permitted hereunder
shall be in writing, and shall be sufficiently given if made by hand delivery,
or first class mail, postage prepaid (except that any notice by the Trustee to
the Company of a default or an Event of Default under this Indenture shall be by
registered or certified mail, postage prepaid, return receipt requested), or by
a nationally-recognized overnight express courier service (which notices or
communications shall be deemed received the business day after the receipt
thereof by such service), addressed as follows:
-66-
if to the Company:
Assisted Living Concepts, Inc.
0000 X.X. Xxxxxxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxx 00000
Attention: President
if to the Trustee:
Xxxxxx Trust and Savings Bank
000 Xxxx Xxxxxx Xxxxxx
00xx Xxxxx
Xxxxxxx, XX 00000
Attention: Corporate Trust Department
The Company or the Trustee by notice to the other may designate additional or
different addresses as shall be furnished in writing by either party. Any
notice or communication to the Company or the Trustee shall be deemed to have
been given or made as of the date so delivered if personally delivered, and five
(5) calendar days after mailing if sent by registered or certified mail (except
that a notice of change of address shall not be deemed to have been given until
actually received by the addressee).
Any notice or communication mailed to a Securityholder shall be mailed
to the address of such Securityholder as it appears on the registration books of
the Registrar and shall be sufficiently given if so mailed within the time
prescribed.
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
In case by reason of the suspension of regular mail service, or by
reason of any other cause, it shall be impossible to mail any notice, as
required by this Indenture, then such method of notification as shall be made
with the approval of the Trustee shall constitute a sufficient mailing of such
notice.
If the Company mails any notice or communication to Securityholders,
it shall mail a copy to the Trustee and all Agents at the same time.
SECTION 13.03 Communications by Holders with Other Holders.
--------------------------------------------
Securityholders of any series may communicate pursuant to TIA
(S) 312(b) with other Securityholders of such series with respect to their
rights under this Indenture or the Securities of such series. The Company, the
Trustee, the Registrar and anyone else shall have the protection of TIA
(S) 312(c).
-67-
SECTION 13.04 Certificate and Opinion as to Conditions
----------------------------------------
Precedent.
---------
Upon any request or application by the Company to the Trustee to take
any action under this Indenture, the Company shall furnish to the Trustee:
(1) an Officers' Certificate (which shall include the statements set
forth in Section 13.05) stating that, in the opinion of the signers,
all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(2) an Opinion of Counsel (which shall include the statements set
forth in Section 13.05) stating that, in the opinion of such counsel,
all such conditions precedent have been complied with.
SECTION 13.05 Statements Required in Certificate and Opinion.
----------------------------------------------
Each Certificate and Opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in
such certificate or opinion are based;
(3) a statement that, in the opinion of such Person, he has made such
examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition
has been complied with; and
-68-
(4) a statement as to whether or not, in the opinion of such Person,
such covenant or condition has been complied with.
SECTION 13.06 Rules by Trustee and Agents.
---------------------------
The Trustee may make reasonable rules for action by or at a meeting of
Securityholders. The Registrar, Paying Agent or Conversion Agent may make
reasonable rules for its functions.
SECTION 13.07 Record Date.
-----------
Whenever the Company or the Trustee solicits an act of Securityholders
of any series, the Company or the Trustee may fix in advance of the solicitation
of such act a date as the record date for determining Securityholders of such
series entitled to perform said act. The record date shall be not more than 15
days prior to the date fixed for the solicitation of said act.
SECTION 13.08 Legal Holidays.
--------------
A "Legal Holiday" is a Saturday, a Sunday or a day on which banks or
trust companies in the city in which either the Trustee or the Company is
located are not required to be open. If a payment date is a Legal Holiday at a
place of payment, payment may be made at that place on the next succeeding day
that is not a Legal Holiday, and no interest shall accrue for the intervening
period.
-69-
SECTION 13.09 Governing Law.
-------------
THE LAWS OF THE STATE OF NEW YORK SHALL GOVERN THIS INDENTURE AND THE
SECURITIES WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.
SECTION 13.10 No Adverse Interpretation of Other Agreements.
---------------------------------------------
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company or a Subsidiary. Any such indenture, loan or debt
agreement may not be used to interpret this Indenture.
SECTION 13.11 No Recourse Against Others.
--------------------------
No shareholder, director or officer, as such, past, present or future,
of the Company or of any successor corporation or trust shall have any liability
for any obligation of the Company under the Securities or the Indenture or for
any claim based on, in respect of or by reason of, such obligations or their
creation. Each Holder of a Security of any series by accepting a Security
waives and releases all such liability. The waiver and release are part of the
consideration for the issuance of the Securities.
SECTION 13.12 Successors.
----------
All agreements of the Company in this Indenture and the Securities
shall bind its successor. All agreements of the Trustee in this Indenture shall
bind its successor.
SECTION 13.13 Multiple Counterparts.
---------------------
The parties may sign multiple counterparts of this Indenture. Each
signed counterpart shall be deemed an original, but all of them together
represent the same agreement.
SECTION 13.14 Table of Contents, Headings, etc.
--------------------------------
The table of contents, cross-reference sheet and headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.
SECTION 13.15 Severability.
------------
In case any provision in this Indenture or in the Securities of any
series shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby, and a Holder shall have no claim therefor against any party
hereto.
-70-
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, all as of the date first written above.
ASSISTED LIVING CONCEPTS, INC.
By: /s/ Xxxxxxx Xxxxxx
__________________________________
Name: Xxxxxx Xxxxxx
Title: Chief Financial Officer
and Chief Administrative
Officer
This rest of this page intentionally left blank.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, all as of the date first written above.
XXXXXX TRUST AND SAVINGS BANK,
as Trustee
By: /s/ Xxx Xxxxxxx
_______________________________
Authorized Officer
The rest of this page intentionally left blank.
