1
Exhibit 4.4
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THE FEDERATED GROUP, INC.
TO
SECURITY PACIFIC
NATIONAL BANK
Trustee
----------------
INDENTURE
Dated as of April 15, 1985
----------------
7 1/2% Convertible Subordinated Debentures
due April 15, 2010
2
THE FEDERATED GROUP, INC.
RECONCILIATION AND TIE BETWEEN TRUST INDENTURE ACT OF 1939 AND
INDENTURE, DATED AS OF APRIL 15, 1985
TRUST INDENTURE
ACT SECTION INDENTURE SECTION
Section 310(a)(1) . . . . . . . . . . . . . . . . . . . . . . 609
(a)(2) . . . . . . . . . . . . . . . . . . . . . . 609
(a)(3) . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(a)(4) . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(b) . . . . . . . . . . . . . . . . . . . . . . . 608
610
Section 311(a) . . . . . . . . . . . . . . . . . . . . . . . 613(a)
(b) . . . . . . . . . . . . . . . . . . . . . . . 613( b)
(b)(2) . . . . . . . . . . . . . . . . . . . . . . 703(a)(2)
703(b)
Section 312(a) . . . . . . . . . . . . . . . . . . . . . . . 701
702(a)
(b) . . . . . . . . . . . . . . . . . . . . . . . 702(b)
(c) . . . . . . . . . . . . . . . . . . . . . . . 702(c)
Section 313(a) . . . . . . . . . . . . . . . . . . . . . . . 703(a)
(b) . . . . . . . . . . . . . . . . . . . . . . . 703(b)
(c) . . . . . . . . . . . . . . . . . . . . . . . 703(a).703(b)
(d) . . . . . . . . . . . . . . . . . . . . . . . 703(c)
Section 314(a) . . . . . . . . . . . . . . . . . . . . . . . 704
(b) . . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(c)(1) . . . . . . . . . . . . . . . . . . . . . . 102
(c)(2) . . . . . . . . . . . . . . . . . . . . . . 102
(c)(3) . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(d) . . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(e) . . . . . . . . . . . . . . . . . . . . . . . 102
Section 315(a) . . . . . . . . . . . . . . . . . . . . . . . 601(a)
(b) . . . . . . . . . . . . . . . . . . . . . . . 602
703(a)(6)
(c) . . . . . . . . . . . . . . . . . . . . . . . 601(b)
(d) . . . . . . . . . . . . . . . . . . . . . . . 601(c)
(d)(1) . . . . . . . . . . . . . . . . . . . . . . 601(a)(1)
(d)(2) . . . . . . . . . . . . . . . . . . . . . . 601(c)(2)
(d)(3) . . . . . . . . . . . . . . . . . . . . . . 601(c)(3)
(e) . . . . . . . . . . . . . . . . . . . . . . . 514
Section 316(a) . . . . . . . . . . . . . . . . . . . . . . . 101
(a)(1)(A) . . . . . . . . . . . . . . . . . . . . 502
512
(a)(1)(B). . . . . . . . . . . . . . . . . . . . . 513
(a)(2) . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(b) . . . . . . . . . . . . . . . . . . . . . . . 508
Section 317(a)(1) . . . . . . . . . . . . . . . . . . . . . . 503
(a)(2) . . . . . . . . . . . . . . . . . . . . . . 504
(b) . . . . . . . . . . . . . . . . . . . . . . . 1003
Section 318(a) . . . . . . . . . . . . . . . . . . . . . . . 107
NOTE: This reconciliation and tie shall not, for any purpose, be deemed to
be a part of the Indenture.
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TABLE OF CONTENTS
PAGE
PARTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
RECITALS OF THE COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Affiliate; control . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Authenticating Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Board of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Board Resolution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Business Day . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Closing Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Commission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Company Request; Company Order . . . . . . . . . . . . . . . . . . . . . . 4
Corporate Trust Office . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Debenture Register, Debenture Registrar . . . . . . . . . . . . . . . . . 4
Defaulted Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Event of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Holder . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Interest Payment Date . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Officers' Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Opinion of Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Paying Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Person . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Predecessor Debenture . . . . . . . . . . . . . . . . . . . . . . . . . . 6
NOTE: This table of contents shall not, for any purpose, be deemed to
be a part of the Indenture.
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PAGE
Redemption Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Redemption Notice Date . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Redemption Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Regular Record Date . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Responsible Officer . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Senior Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Special Record Date . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Stated Maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Trust Indenture Act . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Vice President . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
SECTION 102. Compliance Certificates and Opinions . . . . . . . . . . . . . . . . . . . 8
SECTION 103. Form of Documents Delivered to Trustee . . . . . . . . . . . . . . . . . . 8
SECTION 104. Acts of Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 105. Notices, Etc., to Trustee and Company . . . . . . . . . . . . . . . . . . 10
SECTION 106. Notice to Holders; Waiver . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 107. Conflict with Trust Indenture Act . . . . . . . . . . . . . . . . . . . . 11
SECTION 108. Effect of Headings and Table of Contents . . . . . . . . . . . . . . . . . 11
SECTION 109. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 110. Separability Clause . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 111. Benefits of Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 112. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 113. Legal Holidays . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
ARTICLE TWO
DEBENTURE FORM
SECTION 201. Form Generally . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 202. Form of Face of Debenture . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 203. Form of Reverse of Debenture . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 204. Form of Trustee's Certificate of Authentication . . . . . . . . . . . . . . 19
SECTION 205. Form of Notice of Election to Convert . . . . . . . . . . . . . . . . . . . 19
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ARTICLE THREE
THE DEBENTURES
PAGE
SECTION 301. Title and Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 302. Denominations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 303. Execution, Authentication, Delivery and Dating . . . . . . . . . . . . . . 22
SECTION 304. Temporary Debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 305. Registration, Registration of Transfer and Exchange . . . . . . . . . . . 23
SECTION 306. Mutilated, Destroyed, Lost and Stolen Debentures . . . . . . . . . . . . . 24
SECTION 307. Payment of Interest; Interest Rights Preserved . . . . . . . . . . . . . . 25
SECTION 308. Persons Deemed Owners . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 309. Cancellation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 310. Computation of Interest . . . . . . . . . . . . . . . . . . . . . . . . . 28
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture . . . . . . . . . . . . . . . . . . 28
SECTION 402. Application of Trust Money . . . . . . . . . . . . . . . . . . . . . . . . 29
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 502. Acceleration of Maturity, Rescission and Annulment . . . . . . . . . . . . 32
SECTION 503. Collection of Indebtedness and Suits for Enforcement by
Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 504. Trustee May File Proofs of Claim . . . . . . . . . . . . . . . . . . . . . 34
SECTION 505. Trustee May Enforce Claims Without Possession of Debentures . . . . . . . 35
SECTION 506. Application of Money Collected . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 507. Limitation on Suits . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
SECTION 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest and to Convert . . . . . . . . . . . . . . . . . . 37
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PAGE
SECTION 509. Restoration of Rights and Remedies . . . . . . . . . . . . . . . . . . . . 37
SECTION 510. Rights and Remedies Cumulative . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 511. Delay or Omission Not Waiver . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 512. Control by Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 513. Waiver of Past Defaults . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 514. Undertaking for Costs . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 515. Waiver of Stay or Extension Laws . . . . . . . . . . . . . . . . . . . . . 39
ARTICLE SIX
THE TRUSTEE
SECTION 601. Certain Duties and Responsibilities . . . . . . . . . . . . . . . . . . . 40
SECTION 602. Notice of Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
SECTION 603. Certain Rights of Trustee . . . . . . . . . . . . . . . . . . . . . . . . 41
SECTION 604. Not Responsible for Recitals or Issuance of Debentures . . . . . . . . . . 43
SECTION 605. May Hold Debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 606. Money Held in Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 607. Compensation and Reimbursement . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 608. Disqualification; Conflicting Interests . . . . . . . . . . . . . . . . . 44
(a) Elimination of Conflicting Interest or Resignation . . . . . . . . . 44
(b) Notice of Failure to Eliminate Conflicting Interest . . . . . . . . 44
(c) "Conflicting Interest" Defined . . . . . . . . . . . . . . . . . . . 44
(d) Definitions of Certain Terms Used in This Section . . . . . . . . . 48
(e) Calculation of Percentages of Securities . . . . . . . . . . . . . . 49
SECTION 609. Corporate Trustee Required. Eligibility . . . . . . . . . . . . . . . . . 50
SECTION 610. Resignation and Removal; Appointment of Successor . . . . . . . . . . . . 50
SECTION 611. Acceptance of Appointment by Successor . . . . . . . . . . . . . . . . . . 52
SECTION 612. Merger, Conversion, Consolidation or Succession to Business . . . . . . . 53
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PAGE
SECTION 613. Preferential Collection of Claims Against Company . . . . . . . . . . . . 53
(a) Segregation and Apportionment of Certain Collections by Trustee;
Certain Exceptions . . . . . . . . . . . . . . . . . . . . . . . 53
(b) Certain Creditor Relationships Excluded from Segregation and
Apportionment . . . . . . . . . . . . . . . . . . . . . . . . . . 56
(c) Definitions of Certain Terms Used in This Section. . . . . . . . . . 57
SECTION 614. Appointment of Authenticating Agent . . . . . . . . . . . . . . . . . . . 58
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Company to Furnish Trustee Names and Addresses of Holders. . . . . . . . . 60
SECTION 702. Preservation of information; Communications to Holders . . . . . . . . . . 61
SECTION 703. Reports by Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 704. Reports by Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company May Consolidate, Etc., Only on Certain Terms . . . . . . . . . . . 65
SECTION 802. Successor Corporation Substituted . . . . . . . . . . . . . . . . . . . . 65
ARTICLE NINE
SUPPLEMENTAL INDENTURE
SECTION 901. Supplemental Indentures Without Consent of Holders . . . . . . . . . . . . 66
SECTION 902. Supplemental Indentures with Consent of Holders . . . . . . . . . . . . . 66
SECTION 903. Execution of Supplemental Indentures . . . . . . . . . . . . . . . . . . . 68
SECTION 904. Effect of Supplemental Indentures . . . . . . . . . . . . . . . . . . . . 68
SECTION 905. Conformity with Trust Indenture Act . . . . . . . . . . . . . . . . . . . 68
SECTION 906. Reference in Debentures to Supplemental Indentures . . . . . . . . . . . . 68
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium and Interest . . . . . . . . . . . . . . . . 69
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PAGE
SECTION 1002. Maintenance of Office or Agency . . . . . . . . . . . . . . . . . . . . . 69
SECTION 1003. Money for Debenture Payments to be Held in Trust . . . . . . . . . . . . . 70
SECTION 1004. Corporate Existence . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
SECTION 1005. Statement by Officers as to Default . . . . . . . . . . . . . . . . . . . 71
SECTION 1006. Payment of Taxes and Other Claims . . . . . . . . . . . . . . . . . . . . 72
SECTION 1007. Statement by Officers as to Default . . . . . . . . . . . . . . . . . . . 72
ARTICLE ELEVEN
REDEMPTION OF DEBENTURES
SECTION 1101. Right of Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
SECTION 1102. Applicability of Article . . . . . . . . . . . . . . . . . . . . . . . . . 73
SECTION 1103. Election to Redeem; Notice to Trustee . . . . . . . . . . . . . . . . . . 73
SECTION 1104. Selection by Trustee of Debentures to be Redeemed . . . . . . . . . . . . 74
SECTION 1105. Notice of Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
SECTION 1106. Deposit of Redemption Price . . . . . . . . . . . . . . . . . . . . . . . 75
SECTION 1107. Debentures Payable on Redemption Date . . . . . . . . . . . . . . . . . . 75
SECTION 1108. Debentures Redeemed in Part . . . . . . . . . . . . . . . . . . . . . . . 76
ARTICLE TWELVE
SINKING FUND
SECTION 1201. Sinking Fund Payments . . . . . . . . . . . . . . . . . . . . . . . . . . 76
SECTION 1202. Satisfaction of Sinking Fund Payments with Debentures . . . . . . . . . . 77
SECTION 1203. Redemption of Debentures for Sinking Fund . . . . . . . . . . . . . . . . 77
ARTICLE THIRTEEN
CONVERSION OF DEBENTURES
SECTION 1301. Conversion Privilege and Conversion Price . . . . . . . . . . . . . . . . 78
SECTION 1302. Exercise of Conversion Privileges . . . . . . . . . . . . . . . . . . . . 78
SECTION 1303. Fractions of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
SECTION 1304. Adjustment of Conversion Price . . . . . . . . . . . . . . . . . . . . . . 80
SECTION 1305. Notice of Adjustments of Conversion Price . . . . . . . . . . . . . . . . 83
SECTION 1306. Notice of Certain Corporate Action . . . . . . . . . . . . . . . . . . . . 83
SECTION 1307. Company to Reserve Common Stock . . . . . . . . . . . . . . . . . . . . . 84
SECTION 1308. Taxes on Conversion . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
SECTION 1309. Covenant as to Common Stock . . . . . . . . . . . . . . . . . . . . . . . 85
SECTION 1310. Cancellation of Converted Debentures . . . . . . . . . . . . . . . . . . . 85
SECTION 1311. Provisions in Case of Consolidation. Merger, or Sale of Assets . . . . . . 85
SECTION 1312. Disclaimer by Trustee for Responsibility for Certain Matters . . . . . . . 86
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ARTICLE FOURTEEN
SUBORDINATION OF DEBENTURES
PAGE
SECTION 1401. Agreement to Subordinate . . . . . . . . . . . . . . . . . . . . . . . . . 86
SECTION 1402. Payment Prohibited If Senior Indebtedness in Default . . . . . . . . . . . 87
SECTION 1403. Priority of Senior Indebtedness . . . . . . . . . . . . . . . . . . . . . 87
SECTION 1404. Subrogation of Holders of Debentures . . . . . . . . . . . . . . . . . . . 88
SECTION 1405. Subordination of Debentures Not Affected by Changes in
Provisions of Senior Indebtedness . . . . . . . . . . . . . . . . . . . 89
SECTION 1406. Subordination Provisions for Benefit of Holders of Senior Indebtedness . . 89
SECTION 1407. Rights of Trustee as Holder of Senior Indebtedness . . . . . . . . . . . . 89
SECTION 1408. Obligation of Company to Holders of Debentures Not impaired . . . . . . . 89
SECTION 1409. Reliance Upon Court Order or Decree . . . . . . . . . . . . . . . . . . . 90
SECTION 1410. Subordination Rights Not Impaired by Acts or Omissions of
Company or Holders of Senior Indebtedness . . . . . . . . . . . . . . . 90
SECTION 1411. Trustee to Effectuate Subordination . . . . . . . . . . . . . . . . . . . 91
SECTION 1412. Trustee Not Charged With Knowledge of Senior Indebtedness . . . . . . . . 91
SECTION 1413. Events of Default Not Prevented . . . . . . . . . . . . . . . . . . . . . 91
TESTIMONIUM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
SIGNATURES AND SEALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
ACKNOWLEDGMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
10
INDENTURE, dated as of April 15, 1985, between The Federated Group,
Inc., a Delaware corporation (hereinafter called the "Company"), having its
principal office at 5655 E. Union Pacific Avenue, City of Commerce, California
90022, and Security Pacific National Bank, a national banking association with
its principal offices in Los Angeles, California (hereinafter called the
"Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an issue of its 7 1/2%
Convertible Subordinated Debentures (hereinafter called the "Debentures") of
substantially the tenor and amount hereinafter set forth, and to provide
therefor the Company has duly authorized the execution and delivery of this
Indenture.
All things necessary to make the Debentures, when executed by the
Company and authenticated and delivered hereunder and duly issued by the
Company, the valid obligations of the Company, and to make this Indenture a
valid agreement of the Company, in accordance with their and its terms, have
been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Debentures by the Holders thereof, it is mutually covenanted and agreed, for
the equal and proportionate benefit of all Holders of the Debentures, as
follows:
ARTICLE ONE
DEFINITIONS, AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 101. Definitions.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as the
singular:
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(2) all other terms used herein which are defined in the
Trust Indenture Act either directly or by reference therein, have the
meanings assigned to them therein:
(3) all accounting terms not otherwise defined herein
have the meanings assigned to them in accordance with generally
accepted accounting principles and, except as otherwise herein
expressly provided, the term "generally accepted accounting
principles" with respect to any computation required or permitted
hereunder shall mean such accounting principles as are generally
accepted at the date of such computation; and
(4) the words "herein", "hereof" and "hereunder" and
other words of similar import refer to this Indenture as a whole and
not to any particular Article, Section or other subdivision.
Certain terms, used principally in Article Six, are defined in that
Article.
"Act" when used with respect to any Holder has the meaning specified
in Section 104.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise:
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Authenticating Agent" means any Person authorized by the Trustee to
act on behalf of the Trustee to authenticate Debentures.
"Board of Directors" means either the board of directors of the
Company or any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted
by the Board of Directors and to be in full force and effect on the date of
such certification, and delivered to the Trustee.
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"Business Day" means each Monday, Tuesday, Wednesday, Thursday and
Friday which is not a day on which banking institutions in the City of Los
Angeles, California are authorized or obligated by law or executive order to
close.
"Closing Price" means with respect to the 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,
Inc. or (ii) if the Common Stock is not listed or admitted to trading on such
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 Common Stock is Listed or admitted to trading, or (iii) if the Common
Stock is 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.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Securities Exchange Act of 1934,
or, if at any time after the execution of this instrument such Commission is
not existing and performing the duties now assigned to it under the Trust
Indenture Act, then the body performing such duties at such time.
"Common Stock" means any stock of any class of the Company which has
no preference in respect of dividends or of amounts payable in the event of any
voluntary or involuntary liquidation, dissolution or winding up of the Company
and which is not subject to redemption by the Company. However, subject to the
provisions of Section 1311, shares issuable on conversion of Debentures shall
include only shares of the class designated as Common Stock of the Company at
the date of this Indenture or shares of any class or classes resulting from any
reclassification or reclassifications thereof and which have no preference in
respect of dividends or of amounts payable in the event of any voluntary or
involuntary liquidation, dissolution or winding up of the Company and which are
not subject to redemption by the Company; provided that if at any time there
shall be more than one such resulting class, the shares of each such class then
so issuable shall be
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substantially in the proportion which the total number of shares of such class
resulting from all such reclassifications bears to the total number of shares
of all such classes resulting from all such reclassifications.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor corporation shall have become
such pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor corporation.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its Chairman of the Board, its President
or a Vice President, and by its Senior Financial Officer, its Secretary or an
Assistant Secretary, and delivered to the Trustee.
"Corporate Trust Office" means the office of the Trustee at which at
any particular time its corporate trust business shall be principally
administered; said principal office at the date of the execution of this
Indenture is located at 333 South Hope Street, Los Angeles, California, 90071.
"Corporation" includes corporations, associations, companies and
business trusts.
"Debenture Register" and "Debenture Registrar" have the respective
meanings specified in Section 305.
"Defaulted Interest" has the meaning specified in Section 307.
"Event of Default" has the meaning specified in Section 501.
"Holder" means a Person in whose name a Debenture is registered in the
Debenture Register.
"Indenture" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof.
"Interest Payment Date" means the Stated Maturity of an Installment of
interest on the Debentures.
"Maturity" when used with respect to any Debenture means the date on
which the principal of such Debenture becomes due and payable as therein or
herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.
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"Officers' Certificate" means a certificate signed by the Chairman of
the Board, the President or a Vice President, and by the Senior Financial
Officer, the Secretary or an Assistant Secretary, of the Company, and delivered
to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company, and who shall be acceptable to the Trustee.
"Outstanding" when used with respect to Debentures means, as of the
date of determination, all Debentures theretofore authenticated and delivered
under this Indenture, except:
(i) Debentures theretofore cancelled by the Trustee or
delivered to the Trustee for cancellation:
(ii) Debentures or portion thereof for whose payment or
redemption money in the necessary amount has been theretofore
deposited with the Trustee or any Paying Agent (other than the
Company) in trust or set aside and segregated in trust by the Company
(if the Company shall act as its own Paying Agent) for the Holders of
such Debentures; provided that, if such Debentures are to be redeemed,
notice of such redemption has been duly given pursuant to this
Indenture or provision therefor satisfactory to the Trustee has been
made; and
(iii) Debentures in exchange for or in lieu of which other
Debentures have been authenticated and delivered pursuant to this
Indenture:
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Debentures have given any request, demand,
authorization, direction, notice, consent or waiver hereunder. Debentures
owned by the Company or any other obligor upon the Debentures or any Affiliate
of the Company or of such other obligor shall be disregarded and deemed not to
be Outstanding, except that, in determining whether the Trustee shall be
protected in relying upon any such request, demand, authorization, direction,
notice, consent or waiver, only Debentures which the Trustee knows to be so
owned shall be so disregarded. Debentures so owned which have been pledged in
good faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right so to act with respect to such
Debentures and that the pledgee is not the Company or any other obligor upon
the Debentures or any Affiliate of the Company or of such other obligor.
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"Paying Agent" means any Person authorized by the Company to pay the
principal of (and premium, if any) or interest on any Debentures on behalf of
the Company.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization
or government or any agency or political subdivision thereof.
" Predecessor Debenture" of any particular Debenture means every
previous Debenture evidencing all or a portion of the same debt as that
evidenced by such particular Debenture; and, for the purposes of this
definition, any Debenture authenticated and delivered under Section 306 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Debenture
shall be deemed to evidence the same debt as the mutilated, destroyed, lost or
stolen Debenture.
"Redemption Date", when used with respect to any Debenture to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Notice Date", when used with respect to any Debenture to
be redeemed, means the date on which the notice of such redemption is mailed.
"Redemption Price", when used with respect to any Debenture to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Regular Record Date" for the interest payable on any Interest Payment
Date means the April 1 or October 1 (whether or not a Business Day), as the
case may be, next preceding such Interest Payment Date.
"Responsible 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 those performed by any of the above
designated officers and also means, with respect to a particular
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corporate trust matter, any other officer to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.
"Senior Indebtedness" has the meaning specified in Section 1401.
"Special Record Date" for the payment of any Defaulted Interest means
a date fixed by the Trustee pursuant to Section 307.
"Stated Maturity", when used with respect to any Debenture or any
installment of interest thereon, means the date specified in such Debenture as
the fixed date on which the principal of such Debenture or such installment of
interest is due and payable.
"Subsidiary" means a corporation more than 50% of the outstanding
voting stock of which is owned, directly or indirectly, by the Company or by
one or more other Subsidiaries, or by the Company and one or more other
Subsidiaries. For the purposes of this definition, "voting stock" means stock
which ordinarily has voting power for the election of directors, whether at all
times or only so long as no senior class of stock has such voting power by
reason of any contingency.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in
force at the date as of which this instrument was executed, except as provided
in Section 905.
"Vice President", when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president".
SECTION 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee to take
any action under any provision of this Indenture, the Company shall furnish to
the Trustee an Officers' Certificate stating that all conditions precedent, if
any, provided for in this Indenture relating to the proposed action have been
complied with and an Opinion of Counsel stating that in the opinion of such
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counsel all such conditions precedent, if any, have been complied with, except
that in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate
or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that each individual signing such
certificate or opinion has read such covenant or condition and the
definitions herein relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such
individual, he has made such examination or investigation as is
necessary to enable him to express an informed opinion as to whether
or not such covenant or condition has been complied with; and
(4) a statement as to whether, in the opinion of each
such individual, such condition or covenant has been complied with.
SECTION 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such. Person may certify or give an opinion with respect to some matters and
one or more other such Persons as to other matters, and any such Person may
certify or give an opinion as to such matters to one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be
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based, insofar as it relates to factual matters, upon a certificate or opinion
of, or representations by, an officer or officers of the Company stating that
the information with respect to such factual matters is in the possession of
the Company, unless such counsel knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
SECTION 104. Acts of Holders.
(a) Any request demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agent duty
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the Company.
Such instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or
of a writing appointing any such agent shall be sufficient for any purpose of
this Indenture and (subject to Section 601 ) conclusive in favor of the Trustee
and the Company, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by any reasonable method. The fact and
date of the execution of any such instrument or writing, or the authority of
the Person executing the same, may also be proved in any reasonable manner.
(c) The ownership of Debentures shall be proved by the Debenture
Register.
(d) Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Debenture shall bind every
future Holder of the same Debenture and the Holder of every Debenture issued
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upon the registration of transfer thereof or in exchange therefor or in lieu
thereof in respect of anything done, omitted or suffered to be done by the
Trustee any Debenture Registrar, any Paying Agent or the Company in reliance
thereon, whether or not notation of such action is made upon such Debenture.
SECTION 105. Notices, Etc., to Trustee and Company.
Any request, demand, authorization, direction, notice, consent, waiver
or Act of Holders or other document provided or permitted by this Indenture to
be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be
sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Trustee at its Corporate Trust Office,
Attention: Corporate Trust Department, or
(2) the Company by the Trustee or by any Holder shall be
sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage
prepaid, to the Company addressed to it at the address of its
principal office specified in the first paragraph of this instrument
or at any other address previously furnished in writing to the Trustee
by the Company.
SECTION 106. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event at his address as it appears in the Debenture Register, not later
than the latest date, and not earlier than the earliest date, prescribed for the
giving of such notice. In any case where notice to Holders is given by mail,
neither the failure to mail such notice, nor any defect in any notice so mailed,
to any particular Holder shall affect the sufficiency of such notice with
respect to other Holders. Where this Indenture provides for notice in any
manner, such notice may be waived in writing by the Person entitled to receive
such notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Holders shall be filed with the
Trustee, but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such waiver.
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In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by
mail, then such notification as shall be made with the approval of the Trustee
shall constitute a sufficient notification for every purpose hereunder.
SECTION 107. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with another
provision hereof which is required to be included in this Indenture by any of
the provisions of the Trust Indenture Act, such required provision shall
control.
SECTION 108. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
SECTION 109. Successors and Assigns.
All covenants and agreements in this Indenture by the Company shall
bind its successors and assigns, whether so expressed or not.
SECTION 110. Separability Clause.
In case any provision in this Indenture or in the Debentures shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
SECTION 111. Benefits of Indenture.
Nothing In this Indenture or in the Debentures, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder, the holders of Senior Indebtedness and the Holders of Debentures,
any benefit or any legal or equitable right, remedy or claim under this
Indenture.
SECTION 112. Governing Law.
This indenture and the Debentures shall be governed by and construed
in accordance with the laws of the State of California.
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SECTION 113. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Debenture or any date on which a payment is required to be made
to the sinking fund or the last date on which a Holder has the right to convert
his Debentures shall not be a Business Day, then (notwithstanding any other
provision of this Indenture or of the Debentures) payment of interest or
principal (and premium, if any) or conversion of the Debentures need not be
made on such date, but may be made on the next succeeding Business Day with the
same force and effect as if made on the Interest Payment Date or Redemption
Date, or at the Stated Maturity, or on such last day for conversion, provided
that no interest shall accrue for the period from and after such Interest
Payment Date, Redemption Date or Stated Maturity, or sinking fund payment date,
or on such last day for conversion as the case may be.
ARTICLE TWO
DEBENTURE FORM
SECTION 201. Form Generally.
The Debentures and the Trustee's certificates of authentication shall
be in substantially the form set forth in this Article, with such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture and may have such letters, numbers or other marks
of identification and such legends or endorsements placed thereon as may be
required to comply with the rules of any securities exchange or as may,
consistently herewith, be determined by the officers executing such Debentures,
as evidenced by their execution of the Debentures.
The definitive Debentures shall be printed, lithographed or engraved
or produced by any combination of these methods on steel engraved borders or
may be produced in any other manner permitted by the rules of any securities
exchange on which the Debentures may be listed, all as determined by the
officers executing such Debentures, as evidenced by their execution of such
Debentures.
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SECTION 202. Form of Face of Debenture.
THE FEDERATED GROUP, INC.
7 1/2% CONVERTIBLE SUBORDINATED DEBENTURE DUE APRIL 15, 2010
No. $
------------------- ----------------
THE FEDERATED GROUP, INC., a Delaware corporation (herein called the
"Company"), for value received, hereby promises to pay to or
registered assigns, the principal sum of DOLLARS on April 15,
2010 and to pay interest thereon from April 15, 1985, or from the most recent
Interest Payment Date to which interest has been paid or duly provided for,
semiannually on April 15 and October 15 in each year, commencing October 15,
1985, at the rate of 7 1/2% per annum (computed on the basis of a 360-day year
consisting of 12 30-day months), until the principal hereof is paid or duly
provided for. The interest so payable, and punctually paid or duly provided
for, on any Interest Payment Date will, as provided in such Indenture
hereinafter referred to, be paid to the Person in whose name this Debenture (or
one or more Predecessor Debentures) is registered at the close of business on
the Regular Record Date for such interest, which shall be the April 1 or October
1 (whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date. Any such interest not so punctually paid or duly
provided for will forthwith cease to be payable to the Holder on such Regular
Record Date and may either be paid to the Person in whose name this Debenture
(or one or more Predecessor Debentures) is registered at the close of business
on a Special Record Date for the payment of such Defaulted Interest to be fixed
by the Trustee, notice whereof shall be given to Holders of Debentures not less
than 10 days prior to such Special Record Date, or be paid at any time in any
other lawful manner not inconsistent with the requirements of any securities
exchange on which the Debentures may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in said Indenture. Payment
of the principal of (and premium, if any) on this Debenture will be made at the
office or agency of the Company maintained for that purpose in the Borough of
Manhattan, The City and State of New York, or in the City of Los Angeles,
California or at any other office or agency maintained by the Company for such
purpose. Payment of interest on the Debentures will be made by the Trustee in
Los
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Angeles, California by check or draft mailed to the address of the Person
entitled thereto as such address shall appear in the Debenture Register.
Payment will be made in such currency of the United States of America as at the
time of payment is legal tender for payment of public and private debts. The
term "Company" under the Indenture includes any successor corporation.
Reference is hereby made to the further provisions of this Debenture
set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if sat forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof (directly or through an
Authenticating Agent) by manual signature, this Debenture shall not be entitled
to any benefit under the Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated:
[SEAL]
THE FEDERATED GROUP, INC.
Attest: By
--------------------------------
[Title]
- ---------------------------------
[Title]
SECTION 203. Form of Reverse of Debenture.
This Debenture is one of a duly authorized issue of Debentures of the
Company designated as its 7 1/2% Convertible Subordinated Debentures due April
15, 2010 (herein called the "Debentures"), limited in aggregate principal
amount to $40,000,000, issued and to be issued under an Indenture, dated as of
April 15, 1985 (herein called the "Indenture"), between the Company and
Security Pacific National Bank (herein called the "Trustee", which term
includes any successor trustee under the Indenture), to which Indenture and all
indentures supplemental thereto reference is hereby made for a statement of the
respective rights, limitations of rights, duties and immunities thereunder of
the Company, the Trustee, the Holders of Senior Indebtedness and the Holders of
the Debentures and of the terms upon which the Debentures are, and are to be,
authenticated and delivered.
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Subject to and upon compliance with the provisions of the Indenture,
the Holder of this Debenture is entitled at his option, at any time on or
before the close of business on April 15, 2010, or in case this Debenture or a
portion hereof is called for redemption, then in respect of this Debenture or
such portion hereof until and including, but (unless the Company defaults in
making the payment due upon redemption) not after, the close of business on the
fifth day prior to the Redemption Date, to convert this Debenture (or any
portion of the principal amount hereof which is $1,000 or an integral multiple
thereof), at the principal amount hereof, or of such portion, into fully paid
and nonassessable shares (calculated as to each conversion to the nearest 1/100
of a share) of Common Stock, $.10 par value ("Common Stock") of the Company at
a conversion price equal to $35 aggregate principal amount of Debentures for
each share of Common Stock (or at the current adjusted conversion price if an
adjustment has been made as provided in the Indenture) by surrender of this
Debenture, duly endorsed or assigned to the Company or in blank, to the Company
at its office or agency maintained for such purpose in the Borough of
Manhattan, The City and State of New York, or the City of Los Angeles,
California, accompanied by written notice to the Company that the Holder hereof
elects to convert this Debenture, or if less than the entire principal amount
hereof is to be converted, the portion hereof to be converted, and, in case
such surrender shall be made during the period from the close of business on
any Regular Record Date next preceding any Interest Payment Date to the opening
of business on such Interest Payment Date (unless this Debenture or the portion
thereof being converted has been called for redemption during such period),
also accompanied by payment in New York clearing house funds or Los Angeles
clearing house funds, as the case may be, or other funds acceptable to the
Company and the Trustee of an amount equal to the interest payable on such
Interest Payment Date on the principal amount of this Debenture then being
converted. Subject to the aforesaid requirement for payment and, in the case
of a conversion after the Regular Record Date next preceding any Interest
Payment Date and on or before such Interest Payment Date, to the right of the
Holder of this Debenture (or any Predecessor Debenture) of record at such
Regular Record Date to receive an installment of interest (with certain
exceptions provided in the Indenture), no payment or adjustment is to be made
on conversion for interest accrued hereon or for dividends on the Common Stock
issued on conversion. No fractions of shares or scrip representing fractions
of shares will be issued on conversion, but instead of any fractional interest
the Company shall pay a
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cash adjustment as provided in the Indenture. The conversion price is subject
to adjustment as provided in the Indenture. In addition, the Indenture provides
that in case of certain consolidations or mergers to which the Company is a
party or the sale or transfer of all or substantially all of the assets of the
Company, the Indenture shall be amended, without the consent of any Holders of
Debentures, so that this Debenture, if then outstanding, will be convertible
thereafter, during the period this Debenture shall be convertible as specified
above, only into the kind and amount of securities, cash and other property
receivable upon the consolidation, merger, sale or transfer by a holder of the
number of shares of Common Stock of the Company into which this Debenture might
have been converted immediately prior to such consolidation, merger, sale or
transfer. Any Holder of a Debenture who surrenders his Debenture or any portion
thereof for conversion prior to the close of business on May 2, 1985 shall
receive a due bill representing the right to receive on or after May 3, 1985 the
additional number of shares which such Holder would have been entitled to
receive if such Debenture or portion thereof were surrendered for conversion on
May 3, 1985, computed in accordance with the third paragraph of Section 1301 of
the Indenture.
The Debentures are not redeemable on or prior to April 15, 1987, unless
the last reported sale price for the Common Stock on each of any 20 trading days
within the period of 30 consecutive trading days ending within five Business
Days of the date on which the notice of such redemption is given, equals or
exceeds 140% of the conversion price then in effect as provided in the
Indenture. With respect to redemptions in that event on or prior to April 15,
1987, and with respect to redemptions after April 15, 1987, Debentures are
subject to redemption upon not less than 30 nor more than 60 days notice by
first-class mail, postage prepaid. The redemption may be made in whole, or from
time to time in part, at the option of the Company at a redemption price equal
to the percentage of the principal amount set forth below if redeemed during the
twelve-month period beginning April 15 in each of the years indicated, plus
accrued interest to the date fixed for redemption (provided that, if the date
fixed for redemption (including through the operation of the Sinking Fund
hereinafter provided for) is an Interest Payment Date, the interest payable on
such date shall, subject to exceptions provided in the Indenture, be paid to the
person in whose name this Debenture, or the Debenture or Debentures in exchange
or substitution for which this Debenture shall have been issued, shall have been
registered at the close of business on the April 1 or October 1, as the case may
be, next
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preceding such Interest Payment Date, whether or not such April 1 or October 1
is a Business Day), all as provided in the Indenture:
Year Percentage Year Percentage
1985 . . . . . . . . 107.50 1991 . . . . . . . . . 103.00
1986 . . . . . . . . 106.75 1992 . . . . . . . . . 102.25
1987 . . . . . . . . 106.00 1993 . . . . . . . . . 101.50
1988 . . . . . . . . 105.25 1994 . . . . . . . . . 100.75
1989 . . . . . . . . 104.50 1995 or thereafter . . 100.00
1990 . . . . . . . . 103.75
Notice to the holders of Debentures to be redeemed shall be given by
mailing to such holders a notice of such redemption at their last addresses as
they shall appear on the books maintained for the registration of the
Debentures, all as provided in the Indenture. Any notice which is mailed in the
manner provided in the Indenture shall be conclusively presumed to have been
duly given, whether or not the holder receives such notice, and failure duly to
give such notice by mail, or any defect in such notice, to the holder of any
Debenture designated for redemption as a whole or in part shall not affect the
validity of the proceedings for the redemption of any other Debenture.
The sinking fund provides for the redemption on April 15 in each year
beginning with the year 1996 to and including the year 2009 of $2,000,000
aggregate principal amount of the Debentures. Debentures acquired by the
Company or redeemed otherwise than through the sinking fund or converted may be
credited against subsequent sinking fund requirements.
In the event of redemption or conversion of this Debenture in part
only, a new Debenture or Debentures for the unredeemed or unconverted portion
hereof will be issued in the name of the Holder hereof upon the cancellation
hereof.
The indebtedness evidenced by the Debentures is, to the extent and in
the manner provided in the Indenture, expressly subordinate and subject in right
of payment to the prior payment in full of any Senior Indebtedness of the
Company or provision for such payment, whether outstanding at the date of the
indenture or thereafter incurred, and each Holder of this Debenture, by his
acceptance hereof, agrees to and shall be bound by such
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provisions of the Indenture and authorizes and directs the Trustee in his
behalf to take such action as may be necessary or appropriate to effectuate such
subordination and appoints the Trustee his attorney-in-fact for any and all
such purposes.
If an Event of Default shall occur and be continuing, the principal of
all the Debentures may be declared due and payable in the manner and with the
effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Debentures under the Indenture at
any time by the Company and the Trustee with the consent of the Holders of 66
2/3% in aggregate principal amount of the Debentures at the time Outstanding.
The Indenture also contains provisions permitting the Holders of specified
percentages in aggregate principal amount of the Debentures at the time
Outstanding, on behalf of the Holders of all the Debentures, to waive certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Debenture shall be conclusive and binding upon
such Holder and upon all future Holders of this Debenture and of any Debenture
issued upon the registration of transfer hereof or in exchange herefor or in
lieu hereof, whether or not notation of such consent or waiver is made upon
this Debenture.
No reference herein to the Indenture and no provision of this
Debenture or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of (and
premium, if any) and interest on this Debenture at the times, place and rate,
and in the coin or currency, herein prescribed or to convert this Debenture at
the rate and upon the terms provided in the Indenture.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Debenture is registrable in the
Debenture Register upon surrender of this Debenture for registration of
transfer at the office or agency of the Company maintained for that purpose in
the Borough of Manhattan. The City and State of New York or the City of Los
Angeles, California duty endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Debenture Registrar duly
executed by, the Holder hereof or his attorney duly authorized in writing, and
thereupon one or move new Debentures, of authorized denominations and for the
same aggregate principal amount, will be issued to the designated transferee or
transferees.
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The Debentures are issuable only in registered form without coupons in
denominations of $1,000 and any integral multiple thereof, As provided in the
Indenture and subject to certain limitations therein set forth, Debentures are
exchangeable for a like aggregate principal amount of Debentures of a different
authorized denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Debenture for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Debenture is registered as the owner
hereof for all purposes, whether or not this Debenture be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
All terms used in this Debenture which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
SECTION 204. Form of Trustee's Certificate of Authentication.
This is one of the Debentures referred to in the within mentioned
Indenture.
SECURITY PACIFIC NATIONAL BANK,
as Trustee
By
------------------------------------
Authorized Officer
SECTION 205. Form of Notice of Election to Convert.
TO THE FEDERATED GROUP, INC.:
The undersigned owner of this Debenture hereby: (i) irrevocably
exercises the option to convert this Debenture, or the portion hereof below
designated (which shall be $1,000 or an integral multiple thereof) into
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shares of Common Stock of the Company, in accordance with the terms of the
Indenture referred to in this Debenture, and (ii) directs that the shares and
any due bills issuable and deliverable upon conversion, together with any check
in payment for fractional shares and any Debenture(s) representing any
unconverted principal amount hereof, be issued in the name of and delivered to
the undersigned, unless a different name has been indicated below. If shares or
other securities are to be issued in the name of a person other than the
undersigned, the undersigned will pay all transfer taxes payable with respect
thereto. Any amount required to be paid by the undersigned on account of
interest accompanies this Debenture.
Dated:
-------------------------------
----------------------------------------
Signature
Fill in for registration of shares of Common Stock and Debentures if to be
issued otherwise than to and in the name of the registered holder.
- ---------------------------------------
(Name)
- --------------------------------------- -----------------------------------
(Address) Social Security or Other
Taxpayer Identifying Number
- ---------------------------------------
Please print name and address
(including zip code)
Principal Amount to be Converted:
$
-------------------
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ARTICLE THREE
THE DEBENTURES
SECTION 301. Title and Terms.
The aggregate principal amount of Debentures which may be
authenticated and delivered under this Indenture is limited to $40,000,000,
except for Debentures authenticated and delivered upon registration of transfer
of or in exchange for, or in lieu of, other Debentures pursuant to Section 304,
305, 306, 906, 1108 or 1302.
The Debentures shall be known and designated as the "7 1/2%
Convertible Subordinated Debentures due April 15, 2010," of the Company. Their
Stated Maturity shall be April 15, 2010, and they shall bear interest at the
rate of 7 1/2% per annum, from April 15, 1985 or from the most recent Interest
Payment Date to which interest has been paid or duly provided for, as the case
may be, payable semi-annually on April 15 and October 15, commencing October
15, 1985, until the principal thereof is paid or made available for payment.
The principal of, and premium (if any) on the Debentures shall be
payable at the office or agency of the Company maintained for such purpose in
the Borough of Manhattan, The City and State of New York or the City of Los
Angeles, California and at any other office or agency maintained by the Company
for such purpose. Payment of interest on the Debentures will be made by the
Trustee in Los Angeles, California by check or draft mailed to the address of
the Person entitled thereto as such address shall appear in the Debenture
Register.
The Debentures shall be redeemable as provided in Article Eleven.
The Debentures shall be entitled to the benefits, and be redeemable
through operation, of the sinking fund as provided in Article Twelve.
The Debentures shall be convertible into shares of Common Stock as
provided in Article Thirteen.
The Debentures shall be subordinated in right of payment to Senior
Indebtedness as provided in Article Fourteen.
SECTION 302. Denominations.
The Debentures shall be issuable only in registered form without
coupons and only in denominations of $1,000 and any integral multiple thereof.
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SECTION 303. Execution, Authentication, Delivery and Dating.
The Debentures shall be executed on behalf of the Company by one or
more of its Chairman of the Board, its President or its Vice Presidents, under
its corporate seal reproduced thereon attested by its Secretary or one of its
Assistant Secretaries. The signature of any of these officers on the
Debentures may be manual or facsimile.
Debentures bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Debentures or did not
hold such offices at the dates of such Debentures.
At any time and from time to time after the execution and delivery of
this Indenture. the Company may deliver Debentures executed by the Company to
the Trustee for authentication.
Each Debenture shall be dated the date of its authentication.
No Debenture shall be entitled to any benefit under this Indenture or
be valid or obligatory for any purpose unless there appears on such Debenture a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature of one of its authorized officers
and such certificate upon any Debenture shall be conclusive evidence, and the
only evidence, that such Debenture has been duly authenticated and delivered
hereunder.
SECTION 304. Temporary Debentures.
Pending the preparation of definitive Debentures, the Company may
execute, and upon Company Order the Trustee shall authenticate and deliver,
temporary Debentures which are printed, lithographed, typewritten, mimeographed
or otherwise produced, in any authorized denomination, substantially of the
tenor of the definitive Debentures in lieu of which they are issued and with
such appropriate insertions, omissions, substitutions and other variations as
the officers executing such Debentures may determine, as evidenced by their
execution of such Debentures.
If temporary Debentures are issued, the Company will cause definitive
Debentures to be prepared without unreasonable delay. After the prepara-
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tion, of definitive Debentures, the temporary Debentures shall be exchangeable
for definitive Debentures upon surrender of the temporary Debentures at any
office or agency of the Company designated pursuant to Section 1002, without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Debentures, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like principal amount of
definitive Debentures of authorized denominations. Until so exchanged the
temporary Debentures shall in all respects be entitled to the same benefits
under this Indenture as definitive Debentures.
SECTION 305. Registration, Registration of Transfer and Exchange.
The Company shall cause to be kept at one of its offices or agencies
designated pursuant to Section 1002 (initially such office shall be the
Corporate Trust Office) a register (the register maintained in such office or
agency being herein sometimes collectively referred to as the "Debenture
Register") in which, subject to such reasonable regulations as it may
prescribe, the Company shall provide for the registration of Debentures and of
transfers of Debentures. Said office or agency is hereby initially appointed
"Debenture Registrar" For the purpose of registering Debentures and transfers
of Debentures as herein provided.
Upon surrender for registration of transfer of any Debenture at an
office or agency of the Company designated pursuant to Section 1002 for such
purpose, the Company shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees. one or more
now Debentures of any authorized denominations, of a like aggregate principal
amount.
At the option of the Holder, Debentures may be exchanged for other
Debentures of any authorized denominations, of a like aggregate principal
amount, upon surrender of the Debentures to be exchanged at such office or
agency. Whenever any Debentures are so surrendered For exchange, the Company
shall execute, and the Trustee shall authenticate and deliver, the Debentures
which the Holder making the exchange is entitled to receive.
All Debentures issued upon any registration of transfer or exchange of
Debentures shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Debentures
surrendered upon such registration of transfer or exchange.
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Every Debenture presented or surrendered for registration of transfer
or for exchange shall (if so required by the Company or the Trustee) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Debenture Registrar duly executed, by the
Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Debentures, but the Company may require payment of a sum sufficient
to cover any tax or other governmental, charge that may be imposed in
connection with any registration of transfer or exchange of Debentures, other
than exchanges pursuant to Section 304, 906, 1108 or 1302 not involving any
transfer.
The Company shall not be required (i) to issue, register the transfer
of or exchange any Debenture during a period beginning at the opening of
business IS days before the day of the mailing of a notice of redemption of
Debentures selected for redemption under Section 1104 and ending at the dose of
business on the day of such mailing, or (ii) to register the transfer of or
exchange any Debenture so selected for redemption in whole or in part, except
the unredeemed portion of any Debenture being redeemed in part.
SECTION 306. Mutilated, Destroyed, Lost and Stolen Debentures.
If any mutilated Debenture is surrendered to the Trustee, the Company
shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Debenture of like tenor and principal amount and bearing a
number not contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any
Debenture and (d) such security or indemnity as may be required by them to save
each of them and any agent of either of them harmless, then, in the absence of
notice to the Company or the Trustee chat such Debenture has been acquired by a
bona fide purchaser, the Company shall execute and upon its request the Trustee
shall authenticate and deliver, in lieu of any such destroyed, lost or stolen
Debenture, a new Debenture of like tenor and principal amount and bearing a
number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Debenture has
become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Debenture, pay such Debenture.
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Upon the issuance of any new Debenture under this Section, the Company
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Debenture issued pursuant to this Section in lieu of any
destroyed, lost or stolen Debenture shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Debenture 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 Debentures duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Debentures.
SECTION 307. Payment of Interest, Interest Rights Preserved.
Interest on any Debenture which is payable, and is punctually paid or
duly provided for, on any Interest Payment Date shall be paid to the Person in
whose name that Debenture (or one or more Predecessor Debentures) is registered
at the close of business on the Regular Record Date for such interest.
Any interest on any Debenture which is payable, but is not punctually
paid or duly provided for, on any Interest Payment Date (herein called
"Defaulted Interest) shall forthwith cease to be payable to the Holder on the
relevant Regular Record Date by virtue of having been such Holder, and such
Defaulted Interest may be paid by the Company, at its election in each case, as
provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Debentures (or their
respective Predecessor Debentures) are registered at the close of
business on a Special Record Date for the payment of such Defaulted
Interest, which shall be fixed in the following manner. The Company
shall notify the Trustee in writing of the amount of Defaulted Interest
proposed to be paid on each Debenture and the method of calculation
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thereof and the date of the proposed payment, and at the same time the
Company shall deposit with the Trustee an amount of money equal to the
aggregate amount proposed to be paid in respect of such Defaulted
Interest or shall make arrangements satisfactory to the Trustee for
such deposit prior to the date of the proposed payment, such money when
deposited to be held in trust for the benefit of the Persons entitled
to such Defaulted Interest as in this Clause provided. Thereupon the
Trustee shall fix a Special Record Date for the payment of such
Defaulted Interest which shall be not more than 15 days and not less
than 10 days prior to the date of the proposed payment and not less
than 10 days after the receipt by the Trustee of the notice of the
proposed payment. The Trustee shall promptly notify the Company of
such Special Record Date and, in the name and at the expense of the
Company, shall cause notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor to be mailed, first-class
postage prepaid, to each Holder at his address as it appears in the
Debenture Register, not less than 10 days prior to such Special Record
Date. Notice of the proposed payment of such Defaulted Interest and
the Special Record Date therefor having been so mailed, such Defaulted
Interest shall be paid to the Persons in whose names the Debentures (or
their respective Predecessor Debentures) are registered at the close of
business on such Special Record Date and shall no longer be payable
pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest
in any other lawful manner not inconsistent with the requirements of
any securities exchange on which the Debentures may be listed, and upon
such notice as may be required by such exchange, if, after notice given
by the Company to the Trustee of the proposed payment pursuant to this
Clause, such manner of payment shall be deemed practicable by the
Trustee.
Subject to the foregoing provisions of this Section, each Debenture
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Debenture shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Debenture.
In the case of any Debenture which is converted after any Regular
Record Date and on or prior to the next succeeding Interest Payment Date
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(other than any Debenture whose Maturity is prior to such Interest Payment
Date), interest whose Stated Maturity is 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 that Debenture (or one or more Predecessor Debentures)
is registered at the close of business on such Regular Record Date.
SECTION 308. Persons Deemed Owners.
Prior to due presentment of a Debenture 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 Debenture is registered as the owner of such
Debenture for the purpose of receiving payment of principal of (and premium, if
any) and (subject to Section 307) interest on such Debenture, for the purpose of
the conversion thereof and for all other purposes whatsoever, whether or not
such Debenture be overdue, and neither the Company, the Trustee, nor any agent
Of the Company, or the Trustee shall be affected by notice to the contrary.
SECTION 309. Cancellation.
All Debentures surrendered for payment, redemption, exchange,
registration of transfer or conversion or for credit against any sinking fund
payment pursuant to Section 1202 shall, if surrendered to any Person other than
the Trustee, be delivered to the Trustee and shall be promptly cancelled by it.
The Company may at any time deliver to the Trustee for cancellation any
Debentures previously authenticated and delivered hereunder which the Company
may have acquired in any manner whatsoever, and all Debentures so delivered
shall be promptly cancelled by the Trustee. No Debentures shall be
authenticated in lieu of or in exchange for any Debentures cancelled as provided
in this Section, except as expressly permitted by this Indenture. All cancelled
Debentures held by the Trustee shall be destroyed and certification of their
destruction delivered to [he Company unless by a Company Order the Company shall
direct that canceled Debentures be returned to it.
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SECTION 310. Computation of Interest.
Interest on the Debentures shall be computed on the basis of a 360-day
year consisting of twelve 30-day months.
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture.
This Indenture shall cease to be of further effect (except as to any
surviving rights of conversion of Debentures herein expressly provided for), and
the Trustee, on demand of and at the expense of the Company, shall execute
proper instruments acknowledging satisfaction and discharge of this Indenture,
when
(1) either
(A) all Debentures theretofore authenticated and
delivered (other than (i) Debentures which have been destroyed,
lost or stolen and which have been replaced or paid as provided
in Section 306 and (ii) Debentures for whose payment money has
theretofore been deposited in Trust or segregated and held in
trust by the Company and thereafter repaid to the Company or
Discharged from such trust, as provided in Section 1003) have
been delivered to the Trustee for cancellation or
(B) all such Debentures not theretofore delivered
to the Trustee for cancellation.
(i) have become due and payable, or
(ii) will become due and payable at their
Stated Maturity within one year, or
(iii) are to be called for redemption
within one year under arrangements satisfactory to
the Trustee for the giving of notice of redemption by
the Trustee in the name, and at the expense, of the
Company,
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and the Company, in the case of (i), (ii) or (iii)
above, has deposited or caused to be deposited with
the Trustee as trust funds (which shall be immediately
due and payable) in trust for the purpose an amount
sufficient to pay and discharge the entire
indebtedness on such Debentures not theretofore
delivered to the Trustee for cancellation, for
principal (and premium, if any) and interest to the
date of such deposit (in the case of Debentures which
have become due and payable) or to the Stated Maturity
or Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all other
sums payable hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to the satisfaction and
discharge of this Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 607 and the obligations
of the Trustee to any Authenticating Agent under Section 614 shall survive.
SECTION 402. Application of Trust Money.
All money deposited with the Trustee pursuant to Section 401 shall be
held in trust and applied by it, in accordance with the provisions of the
Debentures and this Indenture, to the payment, either directly or through any
Paying Agent (including the Company acting as its own Paying Agent) as the
Trustee may determine, to the Persons entitled thereto, of the principal (and
premium, if any) and interest for whose payment such money has been deposited
with the Trustee; but such money need not be segregated from other funds except
to the extent required by law. All moneys deposited with the Trustee pursuant
to Section 401 (and held by it or any Paying Agent) for the payment of
Debentures subsequently converted shall be returned to the Company upon Company
Request.
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ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default.
"Event of Default", wherever used herein, means any one of the
Following events (whatever the reason for such Event of Default and whether it
shall be occasioned by the provisions of Article Fourteen or be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(1) default in the payment of any interest upon any
Debenture when it becomes due and payable, and continuance of such
default for a period of 30 days; or
(2) default in the payment of the principal of (or
premium, if any, on) any Debenture at its Maturity; or
(3) default in the deposit of any sinking fund payment,
when and as due by the terms of Article Twelve; or
(4) default in the performance, or breach, of any
covenant or warranty of the Company in this Indenture (other than a
covenant or warranty a default in whose performance or whose breach is
elsewhere in this Section specifically dealt with), and continuance of
such default or breach for a period of 60 days after there has been
given, by registered or certified mail, to the Company by the Trustee
or to the Company and the Trustee by the Holders of at least 10% in
principal amount of the Outstanding Debentures a written notice
specifying such default or breach and requiring it to be remedied and
stating that such notice is a "Notice of Default" hereunder, or
(5) one or more defaults under any bond, debenture, note
or other evidence of indebtedness for money borrowed by the Company or
under any mortgage, indenture or instrument under which there may be
issued or by which there may be secured or evidenced any indebtedness
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for money borrowed by the Company, whether such indebtedness now
exists or shall hereafter be created, which default or defaults shall
have resulted in indebtedness, aggregating $1,000,000 or more,
becoming or being declared due and payable prior to the date on which
it would otherwise have become due and payable, without such
acceleration having been rescinded or annulled, or such indebtedness
having been discharged, within a period of 10 days after there shall
have been given, by registered or certified mail to the Company by the
Trustee or to the Company and the Trustee by the Holders of at least
10% in principal amount of the Outstanding Debentures a written notice
specifying such default and requiring the Company to cause such
acceleration to be rescinded or annulled or cause such indebtedness to
be discharged and stating that such notice is a "Notice of Default"
hereunder, provided, however, that, subject to the provisions of
Sections 601 and 602, the Trustee shall not be deemed to have
knowledge of such default unless either (A) a Responsible Officer of
the Trustee assigned to its Corporate Trust Department shall have
actual knowledge of such default or (B) the Trustee shall have
received written notice thereof from the Company, from any Holder,
from the holder of any such indebtedness or from the trustee under any
such mortgage, indenture or other instruments; or
(6) the entry by a court having jurisdiction in the
premises of (A) a decree or order for relief in respect of the Company
in an involuntary case or proceeding under any applicable Federal or
State bankruptcy, insolvency, reorganization or other similar law or
(B) a decree or order adjudging the Company a bankrupt or insolvent,
or approving as properly filed a petition seeking reorganization,
arrangement, adjustment or composition of or in respect of the
Company under any applicable Federal or State law, or appointing a
custodian, receiver, liquidator, assignee, trustee, sequestrator or
other similar official of the Company or of any substantial part of
its property, or ordering the winding up or liquidation of its
affairs, and the continuance of any such decree or order for relief or
any such other decree or order unstayed and in effect for a period of
90 consecutive days; or
(7) the commencement by the Company of a voluntary case
or proceeding under any applicable Federal or State bankruptcy,
insolvency, reorganization or other similar law or of any other case
or
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proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to
the entry of a decree or order for relief in respect of the Company in an
involuntary case or proceeding under any applicable Federal or State
bankruptcy, insolvency, reorganization or other similar law or to the
commencement of any bankruptcy or insolvency case or proceeding against it, or
the filing by it of a petition or answer or consent seeking reorganization or
relief under any applicable Federal or State law, or the consent by it to the
filing of such petition or to the appointment of or taking possession by a
custodian, receiver, liquidator, assignee, trustee, sequestrator or similar
official of the Company or of any substantial part of its property, or the
making by it of an assignment for the benefit of creditors, or the admission
by it in writing of its inability to pay its debts generally as they become
due, or the taking of corporate action by the Company in furtherance of any
such action.
SECTION 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default occurs and is continuing then and in every such
case the Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Debentures may declare the principal of all the Debentures to be
due and payable immediately, by a notice in writing to the Company (and to the
Trustee if given by Holders), and upon any such declaration such principal,
plus interest, if any, accrued on such Debentures to the date of such
declaration, shall become immediately due and payable. Upon payment (i) of (A)
such aggregate principal amount and (B) interest and (ii) of interest on any
overdue principal and overdue interest (in each case to the extent that the
payment of such interest shall be legally enforceable), all of the Company's
obligations in respect of the payment of the principal of (and premium, if any)
and interest on the Debentures shall terminate.
At any time after such a declaration of acceleration has been made and
before a judgment or decree for payment of the money due has been obtained by
the Trustee as hereinafter in this Article provided, the Holders of a majority
in principal amount of the Outstanding Debentures, by written notice to the
Company and the Trustee, may rescind and annul such declaration and its
consequences if
(1) the Company has paid or deposited with the Trustee a
sum sufficient to pay
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(A) all overdue installments of interest on all
Debentures.
(B) the principal of (and premium, if any, on)
any Debentures which have become due otherwise than by such
declaration of acceleration and interest thereon at the rate
borne by the Debentures,
(C) to the extent that payment of such interest
is lawful, interest upon overdue installments of interest at
the rate borne by the Debentures, and
(D) all sums paid or advanced by the Trustee
hereunder and the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and
counsel;
and
(2) all Events of Default, other than the non-payment of
the principal of Debentures which have become due solely by such
declaration of acceleration, have been cured or waived as provided in
Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
SECTION 503. Collection of Indebtedness and Suits for Enforcement by Trustee.
The Company covenants that if
(1) default is made in the payment of any installment of
interest on any Debenture when such interest becomes due and payable
and such default continues for a period of 30 days,
(2) default is made in the payment of the principal of
(or premium, if any, on) any Debenture at the Maturity thereof, or
(3) default is made in the deposit of any sinking fund
payment when and as due by the terms of Article Twelve,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Debentures, the whole amount then due and payable on such
Debentures for principal (and premium, if any) and interest, with interest upon
the overdue principal (and premium, if any) and, to the extent that payment of
such interest shall be legally enforceable, upon overdue
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installments of interest, at the rate borne by the Debentures; and, in addition
thereto, such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
If the Company fails to pay such amounts forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust, may institute
a judicial proceeding for the collection of the sums so due and unpaid, may
prosecute such proceeding to judgment or final decree and may enforce the same
against the Company or any other obligor upon the Debentures and collect the
moneys adjudged or decreed to be payable in the manner provided by law out of
the property of the Company or any other obligor upon the Debentures, wherever
situated.
If an Event of Default occurs and is continuing, the Trustee may in
its discretion proceed to protect and enforce its rights and the rights of the
Holders by such appropriate judicial proceedings as the Trustee shall deem most
effectual to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.
SECTION 504. Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Debentures or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the Debentures
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company for the payment of overdue principal or interest) shall be entitled
and empowered, by intervention in such proceeding or otherwise.
(i) to file and prove a claim for the whole amount of
principal (and premium, if any) and interest owing and unpaid in
respect of the Debentures and to file such other papers or documents
as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation,
expenses,
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disbursements and advances of the Trustee, its agents and counsel) and
of the Holders allowed in such judicial proceeding, and
(ii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;
and any receiver, assignee, trustee, liquidator, sequestrator or other similar
official in any such judicial proceeding is hereby authorized by each Holder to
make such payments to the Trustee and, in the event that the Trustee shall
consent to the making of such payments directly to the Holders, to pay to the
Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any
other amounts due the Trustee under Section 607.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Debentures
or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
SECTION 505. Trustee May Enforce Claims Without Possession of Debentures.
All rights of action and claims under this Indenture or the Debentures
may be prosecuted and enforced by the Trustee without the possession of any of
the Debentures or the production thereof in any proceeding relating thereto,
and any such proceeding instituted by the Trustee shall be brought in its own
name as trustee of an express trust, and any recovery of judgment shall, after
provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Debentures in respect of which such
judgment has been recovered.
SECTION 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal (or premium,
if any) or interest, upon presentation of the Debentures and the notation
thereon of the payment if only partially paid and upon surrender thereof if
fully paid:
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FIRST: To the payment of all amounts due the Trustee under
Sections 607;
SECOND: Subject to Article 14, to the payment of the amounts
then due and unpaid for principal of (and premium, if any) and
interest on the Debentures in respect of which or for the benefit of
which such money has been collected, ratably, without preference or
priority of any kind, according to the amounts due and payable on such
Debentures for principal (and premium, if any) and interest,
respectively; and
THIRD: Subject to Article 14, the remainder, if any, to the
Company, its successors or assigns, or to whomsoever may be lawfully
entitled to receive such remainder or as a court of competent
jurisdiction shall direct.
SECTION 507. Limitation on Suits.
No Holder of any Debenture shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture, or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless
(1) such Holder has previously given written notice to
the Trustee of a continuing Event of Default:
(2) the Holders of not less than 25% in principal amount
of the Outstanding Debentures shall have made written request to the
Trustee to institute proceedings in respect of such Event of Default
in its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to be
incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of such
notice, request and offer, of indemnity has failed to institute any
such proceeding; and
(5) no direction inconsistent with such written request
has been given to the Trustee during such 60-day period by the Holders
of a majority in principal amount of the Outstanding Debentures;
it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any
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provision of this Indenture to affect, disturb or prejudice the rights of any
other Holders, or to obtain or to seek to obtain priority or preference over
any other Holders or to enforce any right under this Indenture, except in the
manner herein provided and for the equal and ratable benefit of all the
Holders.
SECTION 508. Unconditional Right of Holders to Receive Principal, Premium and
Interest and to Convert.
Notwithstanding any other provision in this Indenture, the Holder of
any Debenture shall have the right, which is absolute and unconditional, to
receive payment of the principal of (and premium, if any) and (subject to
Section 307) interest on such Debenture on the respective Stated Maturities
expressed in such Debenture (or, in the case of redemption, on the Redemption
Date) and to convert such Debenture in accordance with Article Thirteen and to
institute suit for the enforcement of any such payment and right to exchange,
and such rights shall nor be impaired without the consent of such Holder.
SECTION 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders
shall be restored severally and respectively to their former positions
hereunder and thereafter all rights and remedies of the Trustee and the Holders
shall continue as though no such proceeding had been instituted.
SECTION 510. Rights and Remedies Cumulative.
No right or remedy herein conferred upon or reserved to the Trustee or
to the Holders is intended to be exclusive of any other right or remedy, and
every right and remedy shall, to the extent permitted by law, be cumulative and
in addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
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SECTION 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Debenture
to exercise any right or remedy accruing upon any Event of Default shall impair
any such right or remedy or constitute a waiver of any such Event of Default or
an acquiescence therein. Every right and remedy given by this Article or by
law to the Trustee or to the Holders may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Holders, as the case
may be.
SECTION 512. Control by Holders.
The Holders of a majority in principal amount of the Outstanding
Debentures shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee, provided that
(1) such direction shall not be in conflict with any rule
of law or with this Indenture, and
(2) the Trustee may take any other action deemed proper
by the Trustee which is not inconsistent with such direction, and
(3) the Trustee shall have the right to decline to follow
such direction if the Trustee in good faith shall determine that such
would be prejudicial to the Holders not joining in such direction or
would involve the Trustee in personal liability.
SECTION 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Debentures may on behalf of the Holders of all the Debentures waive
any past default hereunder and its consequences, except a default
(1) in the payment of the principal of (or premium, if
any) or interest on any Debenture, or
(2) in respect of a covenant or provision hereof which
under Article Nine cannot be modified or amended without the consent
of the Holder of each Outstanding Debenture affected.
Upon any such waiver, such default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured, for every
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purpose of this Indenture, but no such waiver shall extend to any subsequent or
other default or impair any right consequent thereon.
SECTION 514. Undertaking for Costs.
All parties to this Indenture agree, and each Holder of any Debenture
by his acceptance thereof shall be deemed to have agreed, that any court may in
its discretion require, in any suit for the enforcement of any right or remedy
under this Indenture, or in any suit against the Trustee for any action taken,
suffered or omitted by it as Trustee, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may
in its discretion assess reasonable costs, including reasonable attorneys'
fees, against any party litigant in such suit, having due regard to the merits
and good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to any suit instituted by the
Company, to any suit instituted by the Trustee, to any suit instituted by any
Holder, or group of Holders, holding in the aggregate more than 10% in
principal amount of the Outstanding Debentures, or to any suit instituted by
any Holder for the enforcement of the payment of the principal of (or premium,
if any) or interest on any Debenture on or after the respective Stated
Maturities expressed in such Debenture (or, in, the case of redemption, on or
after the Redemption Date) or for the enforcement of the right to convert any
Debenture in accordance with Article Thirteen.
SECTION 515. Waiver of Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay or extension law wherever
enacted, now or at any time hereafter la force, which may affect the covenants
or the performance of this Indenture, and the Company (to the extent that it
may lawfully do so) hereby expressly waives all benefit or advantage of any
such law and covenants that it will not hinder, delay or impede the execution
of any power herein granted to the Trustee, but will suffer and permit the
execution of every such power as though no such law had been enacted.
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ARTICLE SIX
THE TRUSTEE
SECTION 601. Certain Duties and Responsibilities.
(a) Except during the continuance of an Event of Default,
(1) The Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture, and no
implied covenants or obligations shall be read into this Indenture
against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee
may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements
of this Indenture: but in the case of any such certificates or
opinions which by any provision hereof are specifically required to be
furnished to the Trustee, the Trustee shall be under a duty to examine
the same to determine whether or not they conform to the requirements
of this Indenture.
(b) In case an Event of Default has occurred and is continuing,
the Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their exercise, as a
prudent man would exercise or use under the circumstances in the conduct of his
own affairs.
(c) No provision of this Indenture shall be construed to relieve
The Trustee from liability for its own negligent action, its own negligent
failure to act, or its own wilful misconduct, except that
(1) this Subsection shall not be construed to limit the
effect of Subsection (a) of this Section,
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it shall be proved
that the Trustee was negligent in ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in accordance
with the direction of the Holders of a majority in principal amount of
the
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Outstanding Debentures relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this
Indenture; and
(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) Whether or not therein expressly so provided, every provision
of this Indenture relating to the conduct or affecting, the liability of or
affording protection to the Trustee shall be subject to the provisions of this
Section.
SECTION 602. Notice of Defaults.
Within 90 days after the occurrence of any default hereunder, the
Trustee shall transmit by mail to all Holders, as their names and addresses
appear in the Debenture Register, notice of such default hereunder known to the
Trustee, unless such default shall have been cured or waived; provided,
however, that, except in the case of a default in the payment of the principal
of (or premium, if any) or interest on any Debenture or in the payment of any
sinking fund installment, the Trustee shall be protected in withholding such
notice if and so long, as the board of directors, the executive committee or a
trust committee of directors or Responsible Officers of the Trustee in good
faith determine that the withholding of such notice is in the interest of the
Holders; and provided, further, that in the case of any default of the
character specified in Section 501(4), no such notice to Holders shall be given
until at least 30 days after the occurrence thereof. For the purpose of this
Section, the term "default" means any event which is, or after notice or lapse
of time or both would become, an Event of Default.
SECTION 603. Certain Rights of Trustee.
Except as otherwise provided in Section 601:
(a) the Trustee may rely and shall be protected in acting
or refraining from acting upon any resolution, certificate, statement,
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instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note or other paper or document believed by it
to be genuine and to have been signed or presented by the proper party
or parties;
(b) any request or direction of the Company mentioned
herein shall be sufficiently evidenced by a Company Request or Company
Order and any resolution of the Board of Directors may be sufficiently
evidenced by a Board Resolution;
(c) whenever in the administration of this Indenture the
Trustee shall deem it desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder, the
Trustee (unless other evidence be herein specifically prescribed) may,
in the absence of bad faith on its part, rely upon an Officers'
Certificate;
(d) the Trustee may consult with counsel and the written
advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in reliance
thereon;
(e) the Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Indenture at the
request or direction of any of the Holders pursuant to this Indenture,
unless such Holders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities
which might be incurred by it in compliance with such request or
direction;
(f) the Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note or other paper or
document but the Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit,
and, if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and
premises of the Company, personally or by agent or attorney; and
(g) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys and the Trustee shall not be responsible
for any misconduct
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or negligence on the part of any agent or attorney appointed with due
care by it hereunder.
SECTION 604. Not Responsible for Recitals or Issuance of Debentures.
The recitals contained herein and in the Debentures, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Indenture or of the Debentures. The Trustee shall not be accountable for the
use or application by the Company of Debentures or the proceeds thereof.
SECTION 605. May Hold Debentures.
The Trustee, any Authenticating Agent, any Paying Agent, any Debenture
Registrar or any other agent of the Company, in its individual or any other
capacity, may become the owner or pledgee of Debentures and, subject to
Sections 608 and 613, may otherwise deal with the Company with the same rights
it would have if it were not Trustee, Authenticating Agent, Paying Agent,
Debenture Registrar or such other agent.
SECTION 606. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
otherwise agreed with the Company.
SECTION 607. Compensation and Reimbursement.
The Company agrees
(1) to pay to the Trustee from time to time reasonable
compensation for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to
reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in
accordance with any
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provision of this Indenture (including the reasonable compensation and
the expenses and disbursements of its agents and counsel), except any
such expense, disbursement or advance as may be attributable to its
negligence or bad faith; and
(3) to indemnify the Trustee for, and to hold it harmless
against, any loss, liability or expense incurred without negligence or
bad faith on its part, arising out of or in connection with the
acceptance or administration of this trust, including the costs and
expenses of defending itself against any claim or liability in
connection with the exercise or performance of any of its powers or
duties hereunder.
The obligations of the Company under this Section shall not be
subordinated to the payment of Senior Indebtedness pursuant to Article 14. As
security for the performance of those obligations the Trustee shall have a lien
prior to the Debentures upon all property and funds held or collected by the
Trustee as such, except funds held in trust for the payment of principal of
(and premium, if any) or interest on particular Debentures.
SECTION 608. Disqualification; Conflicting Interests.
(a) If the Trustee has or shall acquire any conflicting interest,
as defined in this Section, it shall, within 90 days after ascertaining that it
has such conflicting interest, either eliminate such conflicting interest or
resign in the manner and with the effect hereinafter specified in this Article.
(b) In the event that the Trustee shall fail to comply with the
provisions of Subsection (a) of this Section, the Trustee shall, within 10 days
after the expiration of such 90-day period, transmit by mail to all Holders, as
their names and addresses appear in the Debenture Register, notice of such
failure.
(c) For the purposes of this Section, the Trustee shall be deemed
to have a conflicting interest if
(1) the Trustee is trustee under another indenture under
which any other securities, or certificates of interest or
participation in any other securities, of the Company are outstanding,
unless such other indenture is a collateral trust indenture under
which the only collateral consists of Debentures issued under this
Indenture, provided that there shall be excluded from the operation of
this paragraph any indenture or
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indentures under which other securities, or certificates of interest
or participation in other securities, of the Company are outstanding,
if
(i) this Indenture and such other indenture or
indentures are wholly unsecured and such other indenture or
indentures are hereafter qualified under the Trust Indenture
Act, unless the Commission shall have found and declared by
order pursuant to Section 305(b) or Section 307(c) of the
Trust Indenture Act that differences exist between the
provisions of this Indenture and the provisions of such other
indenture or indentures which are so likely to involve a
material conflict of interest as to make it necessary in the
public interest or for the protection of investors to
disqualify the Trustee from acting as such under this
Indenture and such other indenture or indentures, or
(ii) the Company shall have sustained the burden
of proving, on application to the Commission and after
opportunity for hearing thereon, that trusteeship under this
Indenture and such other indenture or indentures is not so
likely to involve a material conflict of interest as to make
it necessary in the public interest or for the protection of
investors to disqualify the Trustee from acting as such under
one of such indentures:
(2) the Trustee or any of its directors or executive
officers is an obligor upon the Debentures or an underwriter for the
Company;
(3) the Trustee directly or indirectly controls or is
directly or indirectly controlled by or is under direct or indirect
common control with the Company or an underwriter for the Company;
(4) the Trustee or any of its directors or executive
officers is a director, officer, partner, employee, appointee or
representative of the Company, or of an underwriter (other than the
Trustee itself) for the Company who is currently engaged in the
business of underwriting, except that (i) one individual may be a
director or an executive officer, or both, of the Trustee and a
director or an executive officer, or both, of the Company but may not
be at the same time an executive officer of both the Trustee and the
Company; (ii) if and so long as the number of directors of the Trustee
in office is more than nine, one additional individual may be a
director or an executive officer, or both, of the Trustee and a
director of the Company; and (iii) the Trustee may be
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designated by the Company or by any underwriter for the Company to act
in the capacity of transfer agent, registrar, custodian, paying agent,
fiscal agent, escrow agent or depositary, or in any other similar
capacity, or, subject to the provisions of paragraph (1) of this
Subsection, to act as trustee, whether under an indenture or
otherwise;
(5) 10% or more of the voting securities of the Trustee
is beneficially owned either by the Company or by any director,
partner or executive officer thereof, or 20% or more of such voting
securities is beneficially owned, collectively, by any two or more of
such persons; or 10% or more of the voting securities of the Trustee
is beneficially owned either by an underwriter for the Company or by
any director, partner or executive officer thereof, or is beneficially
owned, collectively, by any two or more such persons;
(6) the Trustee is the beneficial owner of, or holds as
collateral security for an obligation which is in default (as
hereinafter in this Subsection defined), (i) 5% or more of the voting
securities, or 10% or more of any other class of security, of the
Company not including the Debentures issued under this Indenture and
securities issued under any other indenture under which the Trustee is
also trustee, or (ii) 10% or more of any class of security of an
underwriter for the Company;
(7) the Trustee is the beneficial owner of, or holds as
collateral security for an obligation which is in default (as
hereinafter in this Subsection defined), 5% or more of the voting
securities of any person who, to the knowledge of the Trustee, owns
10% or more of the voting securities of, or controls directly or
indirectly or is under direct or indirect common control with, the
Company;
(8) the Trustee is the beneficial owner of, or holds as
collateral security for an obligation which is in default (as
hereinafter in this Subsection defined), 10% or more of any class of
security of any person who, to the knowledge of the Trustee, owns 50%
or more of the voting securities of the Company; or
(9) the Trustee owns, on May 15 in any calendar year, in
the capacity of executor, administrator, testamentary or inter vivos
trustee, guardian, committee or conservator, or in any other similar
capacity, an aggregate of 25% or more of the voting securities, or of
any class of
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security, of any person, the beneficial, ownership of a specified
percentage of which would have constituted a conflicting interest under
paragraph (6), (7) or (8) of this Subsection. As to any such
securities of which the Trustee acquired ownership through becoming
executor, administrator or testamentary trustee of an estate which
included them, the provisions of the preceding sentence shall not
apply, for a period of two years from the date of such acquisition, to
the extent that such securities included in such estate do not exceed
25% of such voting securities or 25% of any such class of security.
Promptly after May 15 in each calendar year, the Trustee shall make a
check of its holdings of such securities in any of the above-mentioned
capacities as of such May 15. If the Company fails to make payment in
full of the principal of (or premium, if any) or interest on any of
the Debentures when and as the same becomes due and payable, and such
failure continues for 30 days thereafter, the Trustee shall make a
prompt check of its holdings of such securities in any of the
above-mentioned capacities as of the date of the expiration of such
30-day period, and after such date, notwithstanding the foregoing
provisions of this paragraph, all such securities so held by the
Trustee, with sole or joint control over such securities vested in it,
shall, but only so long as such failure shall continue, be considered
as though beneficially owned by the Trustee for the purposes of
paragraphs (6), (7) and (8) of this Subsection.
The specification of percentages in paragraphs (5) to (9), inclusive,
of this Subsection shall not be construed as indicating that the ownership of
such percentages of the securities of a person is or is not necessary or
sufficient to constitute direct or indirect control for the purposes of
paragraph (3) or (7) of this Subsection.
For the purposes of paragraphs (6), (7), (8) and (9) of this
Subsection only, (i) the terms "security" and "securities" shall include only
such securities as are generally known as corporate securities, but shall not
include any note or other evidence of indebtedness issued to evidence an
obligation to repay moneys lent to a person by one or more banks, trust
companies or banking firms, or any certificate of interest or participation in
any such note or evidence of indebtedness; (ii) an obligation shall be deemed
to be "in default" when a default in payment of principal shall have continued
for 30 days or more and shall not have been cured; and (iii) the Trustee shall
not be deemed to be the owner or holder of (A) any security
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which it holds as collateral security, as trustee or otherwise, for an
obligation which is not in default as defined in clause (ii) above, or (B) any
security which it holds as collateral security under this Indenture,
irrespective of any default hereunder, or (C) any security which it holds as
agent for collection, or as custodian, escrow agent or depositary, or in any
similar representative capacity.
(d) For the purposes of this Section:
(1) The term "underwriter", when used with reference to
the Company, means every person who, within three years prior to the
time as of which the determination is made, has purchased from the
Company with a view to, or has offered or sold for the Company in
connection with, the distribution of any security of the Company
outstanding at such time, or has participated or has had a direct or
indirect participation in any such undertaking, or has participated or
has had a participation in the direct or indirect underwriting of any
such undertaking, but such term shall not include a person whose
interest was limited to a commission from an underwriter or dealer not
in excess of the usual and customary distributors' or sellers'
commission.
(2) The term "director" means any director of a
corporation or any individual performing similar functions with
respect to any organization, whether incorporated or unincorporated.
(3) The term "person" means an individual, a corporation,
a partnership, an association, a joint-stock company, a trust, an
unincorporated organization or a government or political subdivision
thereof. As used in this paragraph, the term "trust" shall include
only a trust where the interest or interests of the beneficiary or
beneficiaries are evidenced by a security.
(4) The term "voting security" means any security
presently entitling the owner or holder thereof to vote in the
direction or management of the affairs of a person, or any security
issued under or pursuant to any trust agreement or arrangement whereby
a trustee or trustees or agent or agents for the owner or holder of
such security are presently entitled to vote in the direction or
management of the affairs of a person.
(5) The term "Company" means any obligor upon the
Debentures.
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(6) The term "executive officer" means the president,
every vice president, every trust officer, the cashier, the
secretary and the treasurer of a corporation, and any individual
customarily performing similar functions with respect to any
organization whether incorporated or unincorporated, but shall not
include the chairman of the board of directors.
(e) The percentages of voting securities and other securities
specified in this Section shall be calculated in accordance with the following
provisions:
(1) A specified percentage of the voting securities of
the Trustee, the Company or any other person referred to in this
Section (each of whom is referred to as a "person" in this paragraph)
means such amount of the outstanding voting securities of such person
as entitles the holder or holders thereof to cast such specified
percentage of the aggregate votes which the holders of all the
outstanding voting securities of such person are entitled to cast in
the direction or management of the affairs of such person.
(2) A specified percentage of a class of securities of a
person means such percentage of the aggregate amount of securities of
the class outstanding.
(3) The term "amount", when used in regard to securities,
means the principal amount if relating to evidences of indebtedness,
the number of shares if relating to capital shares and the number of
units i relating to any other kind of security.
(4) The term "outstanding" means issued and not held by
or for the account of the issuer. The following securities shall not
be deemed outstanding within the meaning of this definition:
(i) securities of an issuer held in a sinking
fund relating to securities of the issuer of the same class;
(ii) securities of an issuer held in a sinking
fund relating to another class of securities of the issuer, if
the obligation evidenced by such other class of securities is
not in default as to principal or interest or otherwise;
(iii) securities pledged by the issuer thereof as
security for an obligation of the issuer not in default as to
principal or interest or otherwise; and
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(iv) securities held in escrow if placed in escrow
by the issuer thereof;
provided, however, that any voting securities of an issuer shall be
deemed outstanding if any person other than the issuer is entitled to
exercise the voting rights thereof.
(5) A security shall be deemed to be of the same class as
another security if both securities confer upon the holder or holders
thereof substantially the same rights and privileges; provided,
however, that, in the case of secured evidences of indebtedness, all
of which are issued under a single indenture, differences in the
interest rates or maturity dates of various series thereof shall not
be deemed sufficient to constitute such series different classes and
provided, further, that, in the case of unsecured evidences of
indebtedness, differences in the interest rates or maturity dates
thereof shall not be deemed sufficient to constitute them securities
of different classes, whether or not they are issued under a single
indenture.
SECTION 609. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America, any State thereof or the District of Columbia, authorized under such
laws to exercise corporate trust powers, having a combined capital and surplus
of at least $25,000,000 and subject to supervision or examination by Federal,
State or District of Columbia authority. If such corporation publishes reports
of condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
condition so published. If at any time the Trustee shall cease to be eligible
in accordance with the provisions of this Section, it shall resign immediately
in the manner and with the effect hereinafter specified in this Article.
SECTION 610. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 611.
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(b) The Trustee may resign at any time by giving written notice
thereof to the Company. If an instrument of acceptance by a successor Trustee
shall not have been delivered to the Trustee within 30 days after the giving of
such notice of resignation, the resigning Trustee may petition any court of
competent jurisdiction for the appointment of a successor Trustee.
(c) The Trustee may be removed at any time by Act of the Holders
of a majority in principal amount of the Outstanding Debentures, delivered to
the Trustee and to the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 608(a) after
written request therefor by the Company or by any Holder who has been
a bona fide Holder of a Debenture for at least six months, or
(2) the Trustee shall cease to be eligible under Section
609 and shall fail to resign after written request therefor by the
Company or by any such Holder, or
(3) the Trustee shall become incapable of acting or shall
be adjudged a bankrupt or insolvent or a receiver of the Trustee or of
its property shall be appointed or any public officer shall take
charge or control of the Trustee or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation.
then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee, or (ii) subject to Section 514, any Holder who has been a bona fide
Holder of a Debenture for at least six months may, on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee.
(e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, the
Company, by a Board Resolution, shall promptly appoint a successor Trustee.
If, within one year after such resignation, removal or incapability, or the
occurrence of such vacancy, a successor Trustee shall be appointed by Act of
the Holders of a majority in principal amount of the Outstanding Debentures
delivered to the Company and the retiring Trustee, the successor Trustee so
appointed shall, forthwith upon its acceptance of such appoint-
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ment, become the successor Trustee and supersede the successor Trustee
appointed by the Company. If no successor Trustee shall have been so appointed
by the Company or the Holders and accepted appointment in the manner
hereinafter provided, any Holder who has been a bona fide Holder of a Debenture
for at least six months may, on behalf of himself and all others similarly
situated, petition any court of competent jurisdiction for the appointment of a
successor Trustee.
(f) The Company shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor Trustee by mailing
written notice of such event by first-class mail postage prepaid, to all
Holders as their names and addresses appear in the Debenture Register. Each
notice shall include the name of the successor Trustee and the address of its
Corporate Trust Office.
SECTION 611. Acceptance of Appointment by Successor.
Every successor Trustee appointed hereunder shall execute, acknowledge
and deliver to the Company and to the retiring Trustee an instrument accepting
such appointment, and thereupon the resignation or removal of the retiring
Trustee shall become effective and such successor Trustee, without any further
act, deed or conveyance, shall become vested with all the rights, powers,
trusts and duties of the retiring Trustee; but, on request of the Company or
the successor Trustee, such retiring Trustee shall, upon payment of its
charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee and shall
duly assign, transfer and deliver to such successor Trustee all property and
money held by such retiring Trustee hereunder, subject nevertheless to its
lien, if any, provided for in Section 607. Upon request of any such successor
Trustee, the Company shall execute any and all instruments for more fully and
certainly vesting in and confirming to such successor Trustee all such rights,
powers and trusts.
No successor Trustee shall accept its appointment unless at the time
of such acceptance such successor Trustee shall be qualified and eligible under
this Article.
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SECTION 612. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation succeeding to all or substantially all the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto. In case any Debentures shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Debentures so authenticated with the same
effect as if such successor Trustee had itself authenticated such Debentures.
SECTION 613. Preferential Collection of Claims Against Company.
(a) Subject to Subsection (b) of this Section, if the Trustee
shall be or shall become a creditor, directly or indirectly, secured or
unsecured, of the Company within four months prior to a default, as defined in
Subsection (c) of this Section, or subsequent to such a default, then, unless
and until such default shall be cured, the Trustee shall set apart and hold in
a special account for the benefit of the Trustee individually, the Holders of
the Debentures and the holders of other indenture securities, as defined in
Subsection (c) of this Section:
(1) an amount equal to any and all reductions in the
amount due and owing upon any claim as such creditor in respect of
principal or interest, effected after the beginning of such four
months' period and valid as against the Company and its other
creditors, except any such reduction resulting from the receipt or
disposition of any property described in paragraph (2) of this
Subsection, or from the exercise of any right of set-off which the
Trustee could have exercised if a petition in bankruptcy had been filed
by or against the Company upon the date of such default; and
(2) all property received by the Trustee in respect of
any claims as such creditor, either as security therefor, or in
satisfaction or composition thereof, or otherwise, after the beginning
of such four months'
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period, or an amount equal to the proceeds of any such property, if
disposed of, subject, however, to the rights, if any, of the Company
and its other creditors in such property or such proceeds.
Nothing herein contained, however, shall affect the right of the Trustee:
(A) to retain for its own account (i) payments made on
account of any such claim by any Person (other than the Company) who
is liable thereon, and (ii) the proceeds of the bona fide sale of any
such claim by the Trustee to a third Person, and (iii) distributions
made in cash, securities or other property in respect of claims filed
against the Company in bankruptcy or receivership or in proceedings
for reorganization pursuant to the Federal Bankruptcy Code or
applicable State law;
(B) to realize, for its own account, upon any property
held by it as security for any such claim, if such property was so
held prior to the beginning of such four months' period;
(C) to realize, for its own account, but only to the
extent of the claim hereinafter mentioned, upon any property held by
it as security for any such claim, if such claim was created after the
beginning of such four months' period and such property was received
as security therefor simultaneously with the creation thereof, and if
the Trustee shall sustain the burden of proving that at the time such
property was so received the Trustee had no reasonable cause to
believe that a default, as defined in Subsection (c) of this Section,
would occur within four months; or
(D) to receive payment on any claim referred to in
paragraph (B) or (C), against the release of any property held as
security for such claim as provided in paragraph (B) or (C), as the
case may be, to the extent of the fair value of such property.
For the purposes of paragraphs (B), (C) and (D), property substituted
after the beginning of such four months' period for property held as security
at the time of such substitution shall, to the extent of the fair value of the
property released, have the same status as the property released, and, to the
extent that any claim referred to in any of such paragraphs is created in
renewal of or in substitution for or for the purpose of repaying or refunding
any pre-existing claim of the Trustee as such creditor, such claim shall have
the same status as such pre-existing claim.
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If the Trustee shall be required to account, the funds and property
held in such special account and the proceeds thereof shall be apportioned
among the Trustee, the Holders and the holders of other indenture securities in
such manner that the Trustee, the Holders and the holders of other indenture
securities realize, as a result of payments from such special account and
payments of dividends on claims filed against the Company in bankruptcy or
receivership or in proceedings for reorganization pursuant to the Federal
Bankruptcy Act or applicable State law, the same percentage of their respective
claims, figured before crediting to the claim of the Trustee anything on
account of the receipt by it from the Company of the funds and property in such
special account and before crediting to the respective claims of the Trustee
and the Holders and the holders of other indenture securities dividends on
claims filed against the Company in bankruptcy or receivership or in proceedings
for reorganization pursuant to the Federal Bankruptcy Code or applicable State
law, but after crediting thereon receipts on account of the indebtedness
represented by their respective claims from all sources other than from such
dividends and from the funds and property so held in such special account. As
used in this paragraph, with respect to any claim, the term "dividends" shall
include any distribution with respect to such claim, in bankruptcy or
receivership or proceedings for reorganization pursuant to the Federal
Bankruptcy Code or applicable State law, whether such distribution is made in
cash, securities or other property, but shall not include any such distribution
with respect to the secured portion, if any, of such claim. The court in which
such bankruptcy, receivership or proceedings for reorganization is pending
shall have jurisdiction (i) to apportion among the Trustee, the Holders and the
holders of other indenture securities, in accordance with the provisions of
this paragraph, the funds and property held in such special account and
proceeds thereof, or (ii) in lieu of such apportionment, in whole or in part,
to give to the provisions of this paragraph due consideration in determining the
fairness of the distributions to be made to the Trustee and the Holders and the
holders of other indenture securities with respect to their respective claims,
in which event it shall not be necessary to liquidate or to appraise the value
of any securities or other property held in such special account or as security
for any such claim, or to make a specific allocation of such distributions as
between the secured and unsecured portions of such claims, or otherwise to
apply the provisions of this paragraph as a mathematical formula.
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Any Trustee which has resigned or been removed after the beginning of
such four months' period shall be subject to the provisions of this Subsection
as though such resignation or removal had not occurred. If any Trustee has
resigned or been removed prior to the beginning of such four months' period, it
shall be subject to the provisions of this Subsection if and only if the
following conditions exist:
(i) the receipt of property or reduction of claim, which
would have given rise to the obligation to account, if such Trustee
had continued as Trustee, occurred after the beginning of such four
months' period: and
(ii) such receipt of property or reduction of claim
occurred within four months after such resignation or removal.
(b) There shall be excluded from the operation of Subsection (a)
of this Section a creditor relationship arising from:
(1) the ownership or acquisition of securities issued under
any indenture, or any security or securities having a maturity of one
year or more at the time of acquisition by the Trustee,
(2) advances authorized by a receivership or bankruptcy
court of competent jurisdiction or by this Indenture, for the purpose
of preserving any property which shall at any time be subject to the
lien of this Indenture or of discharging tax liens or other prior
liens or encumbrances thereon, if notice of such advances and of the
circumstances surrounding the making thereof is given to the Holders
at the time and in the manner provided in this Indenture;
(3) disbursements made in the ordinary course of business
in the capacity of trustee under an indenture, transfer agent,
registrar, custodian, paying agent, fiscal agent or depositary, or
other similar capacity;
(4) an indebtedness created as a result of services
rendered or premises rented, or an indebtedness created as a result of
goods or securities sold in a cash transaction, as defined in
Subsection (c) of this Section;
(5) the ownership of stock or of other securities of a
corporation organized under the provisions of Section 25(a) of the
Federal Reserve
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Act, as amended which is directly or indirectly a creditor of the
Company; or
(6) the acquisition, ownership, acceptance or negotiation
of any drafts, bills of exchange, acceptances or obligations which
fall within the classification of self-liquidating paper, as defined
in Subsection (c) of this Section.
(c) For the purposes of this Section only:
(1) the term "default" means any failure to make payment in
full of the principal of or interest on any of the Debentures or upon
the other indenture securities when and as such principal or interest
becomes due and payable;
(2) the term "other indenture securities" means
securities upon which the Company is an obligor outstanding under any
other indenture (i) under which the Trustee is also trustee, (ii)
which contains provisions substantially similar to the provisions of
this Section, and (iii) under which a default exists at the time of
the apportionment of the funds and property held in such special
account;
(3) the term "cash transaction" means any transaction in
which full payment for goods or securities sold is made within seven
days after delivery of the goods or securities in currency or in
checks or other orders drawn upon banks or bankers and payable upon
demand;
(4) the term "self-liquidating paper" means any draft,
bill of exchange, acceptance or obligation which is made, drawn,
negotiated or incurred by the Company for the purpose of financing the
purchase, processing, manufacturing, shipment, storage or sale of
goods, wares or merchandise and which is secured by documents
evidencing title to, possession of, or a lien upon, the goods, wares
or merchandise or the receivables or proceeds arising from the sale of
the goods, wares or merchandise previously constituting the security,
provided the security is received by the Trustee simultaneously with
the creation of the creditor relationship with the Company arising
from the making, drawing, negotiating or incurring of the draft, bill
of exchange, acceptance or obligation;
(5) the term "Company" means any obligor upon the
Debentures; and
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(6) the term "Federal Bankruptcy Code" means Title 11 of
the United States Code as amended from time to time.
SECTION 614. Appointment of Authenticating Agent.
At any time when any of the Debentures remain Outstanding the Trustee
may appoint an Authenticating Agent or Agents which shall be authorized to act
on behalf of the Trustee to authenticate Debentures issued upon exchange,
except for authentication upon original issue pursuant to Section 303 and in
connection with lost, stolen or destroyed Debentures pursuant to Section 306,
registration of transfer or partial redemption or exchange thereof. Debentures
so authenticated shall be entitled to the benefits of this Indenture and shall
be valid and obligatory for all purposes as if authenticated by the Trustee
hereunder. Wherever reference is made in this Indenture to the authentication
and delivery of Debentures by the Trustee or the Trustee's certificate of
authentication such reference shall be deemed to include authentication and
delivery on behalf of the Trustee by an Authenticating Agent and a certificate
of authentication executed on behalf of the Trustee by an Authenticating Agent.
Each Authenticating Agent shall be acceptable to the Company and shall at all
times be a corporation organized and doing business under the laws of the
United States of America, any State thereof or the District of Columbia,
authorized under such laws to act as Authenticating Agent, having a combined
capital and surplus of not less than $25,000,000 and subject to supervision or
examination by Federal, State or District of Columbia authority. If such
Authenticating Agent publishes reports of condition at least annually, pursuant
to law or to the requirements of said supervising or examining authority, then
for the purposes of this Section, the combined capital and surplus of such
Authenticating Agent shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time
an Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, such Authenticating Agent shall resign immediately
in the manner and with the effect specified in this Section.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate
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agency or corporate trust business of an Authenticating Agent, shall continue
to be an Authenticating Agent, provided such corporation shall be otherwise
eligible under this Section, without the execution or filing of any paper or
any further act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written
notice thereof to the Trustee and to the Company. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice
thereof to such Authenticating Agent and to the Company. Upon receiving such a
notice of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall mail written notice of
such appointment by first-class mail, postage prepaid, to all Holders as their
names and addresses appear in the Debenture Register in accordance with Section
106. Any successor Authenticating Agent upon acceptance of its appointment
hereunder shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as if originally named as an
Authenticating Agent herein. No successor Authenticating Agent shall be
appointed unless eligible under the provisions of this Section.
The Trustee agrees
(1) to pay to each Authenticating Agent from time to time
reasonable compensation for all services rendered by it hereunder;
(2) except as otherwise expressly provided herein, to
reimburse the Authenticating Agent upon its request for all reasonable
expenses, disbursements and advances incurred or made by the
Authenticating Agent in accordance with any provision of this
Indenture (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or
bad faith; and
(3) to indemnify the Authenticating Agent for, and to
hold it harmless against, any loss, liability or expense incurred
without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of this trust,
including the costs and expenses of defending itself against any claim
or liability in connection with the exercise or performance of any of
its powers or duties hereunder.
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Such payments by the Trustee shall be reimbursable expenses, Subject
to the provisions of Section 607.
If an appointment is made pursuant to this Section, the Debentures may
have endorsed thereon, in addition to the Trustee's certificate of
authentication, an alternate certificate of authentication in the following
form:
This is one of the Debentures described in the within-mentioned
Indenture.
-------------------------------
As Trustee
By
-----------------------------
As Authenticating Agent
By
-----------------------------
Authorized Officer
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee
(a) semi-annually, not more than 15 days after each
Regular Record Date, a list, in such form as the Trustee may
reasonably require, of the names and addresses of the Holders as of
such Regular Record Date, and
(b) at such other times as the Trustee may request in
writing, within 30 days after the receipt by the Company of any such
request, a list of similar form and content as of a date not more than
15 days prior to the time such list is furnished;
provided no such list need be furnished if the Trustee shall be the Debenture
Registrar.
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SECTION 702. Preservation of Information; Communications to Holders.
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders contained in the
most recent list furnished to the Trustee as provided in Section 701 and the
names and addresses of Holders received by the Trustee in its capacity as
Debenture Registrar. The Trustee may destroy any list furnished to it as
provided in Section 701 upon receipt of a new list so furnished.
(b) If three or more Holders (herein referred to as "applicants")
apply in writing to the Trustee, and furnish to the Trustee reasonable proof
that each such applicant has owned a Debenture for a period of at least six
months preceding the date of such application, and such application states that
the applicants desire to communicate with other Holders with respect to their
rights under this Indenture or under the Debentures and is accompanied by a
copy of the form of proxy or other communication which such applicants propose
to transmit, then the Trustee shall, within five Business Days after the receipt
of such application, at its election, either
(i) afford such applicants access to the information
preserved at the time by the Trustee in accordance with Section
702(a), or
(ii) inform such applicants as to the approximate number
of Holders whose names and addresses appear in the information
preserved at the time by the Trustee in accordance with Section
702(a), and as to the approximate cost of mailing to such Holders the
form of proxy or other communication, if any, specified in such
application.
If the Trustee shall elect not to afford such applicants access to
such information the Trustee shall, upon the written request of such
applicants, mail to each Holder whose name and address appear in the information
preserved at the time by the Trustee in accordance with Section 702(a) a copy
of the form of proxy or other communication which is specified in such request,
with reasonable promptness after a tender to the Trustee of the material to be
mailed and of payment, or provision for the payment, of the reasonable expenses
of mailing, unless within five days after such tender the Trustee shall mail to
such applicants and file with the Commission, together with a copy of the
material to be mailed, a written statement to the effect that, in the opinion
of the Trustee, such mailing would be contrary to the best interest of the
Holders or would be in violation of applicable law. Such
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written statement shall specify the basis of such opinion. If the Commission,
after opportunity for a hearing upon the objections specified in the written
statement so filed, shall enter an order refusing to sustain any of such
objections or if, after the entry of an order sustaining one or more of such
objections, the Commission shall find, after notice and opportunity for
hearing, that all the objections so sustained have been met and shall enter an
order so declaring, the Trustee shall mail copies of such material to all such
Holders with reasonable promptness after the entry of such order and the
renewal of such tender, otherwise the Trustee shall be relieved of any
obligation or duty to such applicants respecting their application.
(c) Every Holder of Debentures, by receiving and holding the same,
agrees with the Company and the Trustee that neither the Company nor the
Trustee nor any agent of either of them shall be held accountable by reason of
the disclosure of any such information as to the names and addresses of the
Holders in accordance with Section 702(b), regardless of the source from which
such information was derived, and that the Trustee shall not be held
accountable by reason of mailing any material pursuant to a request made under
Section 702(b).
SECTION 703. Reports by Trustee.
(a) Within 60 days after May 15 of each year commencing with the
year 1986, the Trustee shall transmit by mail to all Holders, as their names
and addresses appear in the Debenture Register, a brief report dated as of such
May 1 with respect to:
(1) its eligibility under Section 609 and its
qualifications under Section 608, or in lieu thereof, if to the best
of its knowledge it has continued to be eligible and qualified under
said Sections, a written statement to such effect;
(2) the character and amount of any advances (and if the
Trustee elects so to state, the circumstances surrounding the making
thereof) made by the Trustee (as such) which remain unpaid on the date
of such report, and for the reimbursement of which it claims or may
claim a lien or charge, prior to that of the Debentures, on any
property or funds held or collected by it as Trustee, except that the
Trustee shall not be required (but may elect) to report such advances
if such advances so remaining unpaid aggregate not more than 1/2 of 1%
of the principal amount of the Debentures Outstanding on the date of
such report;
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(3) the amount, interest rate and maturity date of all
other indebtedness owing by the Company (or by any other obligor on
the Debentures) to the Trustee in its individual capacity, on the date
of such report, with a brief description of any property held as
collateral security therefor, except an indebtedness based upon a
creditor relationship arising any manner described in Section
613(b)(2), (3), (4) or (6);
(4) the property and funds, if any, physically in the
possession of the Trustee as such on the date of such report;
(5) any additional issue of Debentures which the Trustee
has not previously reported; and
(6) any action taken by the Trustee in the performance of
its duties hereunder which it has not previously reported and which in
its opinion materially affects the Debentures, except action in
respect of a default, notice of which has been or is to be withheld by
the Trustee in accordance with Section 602.
(b) The Trustee shall transmit by mail to all Holders, as their
names and addresses appear in the Debenture Register, a brief report with
respect to the character and amount of any advances (and if the Trustee elects
so to state, the circumstances surrounding the making thereof) made by the
Trustee (as such) since the date of the last report transmitted pursuant to
Subsection (a) of this Section (or if no such report has yet been so
transmitted, since the date of execution of this instrument for the
reimbursement of which it claims or may claim a lien or charge, prior to that of
the Debentures, on property or funds held or collected by it as Trustee and
which it has not previously reported pursuant to this Subsection, except that
the Trustee shall not be required (but may elect) to report such advances if
such advances remaining unpaid at any time aggregate 10% or less of the
principal amount of the Debentures Outstanding at such time, such report to be
transmitted within 90 days after such time.
(c) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each stock exchange upon
which the Debentures are listed, with the Commission and with the Company. The
Company, will notify the Trustee when the Debentures are listed on any stock
exchange.
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(d) Notwithstanding paragraphs (a)-(c) of this Section, if
subsequent to the date hereof, Section 313 of the Trust Indenture Act is
amended to eliminate the requirement of such report, no such report need be
mailed or filed.
SECTION 704. Reports by Company.
The Company shall:
(1) file with the Trustee, within 15 days after the
Company is required to file the same with the Commission, copies of
the annual reports and of the information, documents and other reports
(or copies of such portions of any of the foregoing as the Commission
may from time to time by rules and regulations prescribe) which the
Company may be required to file with the Commission pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934,
or, if the Company is not required to file information, documents or
reports pursuant to either of said Sections, then it shall file with
the Trustee and the Commission, in accordance with rules and
regulations prescribed from time to time by the Commission, such of
the supplementary and periodic information documents and reports which
may be required pursuant to Section 13 of the Securities Exchange Act
of 1934 in respect of a security listed and registered on a national
securities exchange as may be prescribed from time to time in such
rules and regulations;
(2) file with the Trustee and the Commission, in
accordance with rules and regulations prescribed from time to time by
the Commission, such additional information, documents and reports
with respect to compliance by the Company with the conditions and
covenants of this Indenture as may be required from time to time by
such rules and regulations; and
(3) transmit by mail to all Holders, as their names and
addresses appear in the Debenture Register, within 30 days after the
filing thereof with the Trustee, such summaries of any information,
documents and reports required to be filed by the Company pursuant to
paragraphs (1) and (2) of this Section as may be required by rules and
regulations prescribed from time to time by the Commission.
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ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company May Consolidate, Etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any other
corporation or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, unless:
(1) the corporation formed by such consolidation or into which
the Company is merged or the Person which acquires by conveyance or,
transfer, or which leases, the properties and assets of the Company
substantially as an entirety shall be a corporation organized and
existing under the laws of the United States of America, any State
thereof or the District of Columbia and shall expressly assume, by an
indenture supplemental hereto, executed and delivered to the Trustee,
in form satisfactory to the Trustee, the due and punctual payment of
the principal of (and premium, if any) and interest on all the
Debentures and the performance of every covenant of this Indenture on
the part of the Company to be performed or observed and shall have
provided for conversion rights in accordance with Section 1311;
(2) immediately after giving effect to such transaction
and creating any indebtedness which becomes an obligation of the
Company or a Subsidiary as a result of such transaction as having been
by the Company or such Subsidiary at the time of such transaction, no
Event of Default, and no event which, after notice or lapse of time or
both, would become an Event of Default, shall have happened and be
continuing; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance, transfer or lease and such
supplemental indenture comply with this Article and that all
conditions precedent herein provided for relating to such transaction
have been complied with.
SECTION 802. Successor Corporation Substituted.
Upon any consolidation or merger or any conveyance, transfer or lease
of the properties and assets of the Company substantially as an entirety to
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any Person in accordance with Section 801, the successor corporation formed by
such consolidation or into which the Company is merged or to which such
conveyance, transfer or lease is made shall succeed to, and be substituted for,
and may exercise every right and power of, the Company under this Indenture
with the same effect as if such successor corporation had been named as the
Company herein, and thereafter, except in the case of a lease to another
Person, the predecessor corporation shall be relieved of all obligations and
covenants under this Indenture and the Debentures.
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may enter
into one or more indentures supplemental hereto, in form satisfactory to the
Trustee, for any of the following purposes:
(1) to evidence the succession of another corporation to
the Company and the assumption by any such successor of the covenants
of the Company herein and in the Debentures; or
(2) to add to the covenants of the Company for the
benefit of the Holders, or to surrender any right or power herein
conferred upon the Company; or
(3) to comply with the requirements of Section 1311; or
(4) 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 the provisions of this Indenture, provided such
other provisions shall not adversely affect the interests of the
Holders in any material respect.
SECTION 902. Supplemental Indentures with Consent of Holders.
With the consent of the Holders of not less than 66 2/3% in principal
amount of the Outstanding Debentures, by Act of said Holders delivered to
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the Company and the Trustee, the Company, when authorized by a Board
Resolution, and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of
modifying in any manner the rights of the Holders under this Indenture;
provided, however, that no such supplemental indenture shall without the
consent of the Holder of each Outstanding Debenture affected thereby,
(1) change the Stated Maturity of the principal of, or
any installment of interest on, any Debenture, or reduce the principal
amount thereof or the rate of interest thereon or any premium payable
upon the redemption thereof, or change the place of payment where, or
the coin or currency in which, any Debenture or any premium or the
interest thereon is payable, or impair the right to institute suit for
the enforcement of any such payment on or after the Stated Maturity
thereof (or, in the case of redemption, on or after the Redemption
Date), or adversely affect the right to convert any Debenture as
provided in Article Thirteen or modify the provisions of this
Indenture with respect to the subordination of the Debentures in a
manner adverse to the Holders, or
(2) reduce the percentage in principal amount of the
Outstanding Debentures, the consent of whose Holders is required for
any such supplemental indenture, or the consent of whose Holders is
required for any waiver (of compliance with certain provisions of this
Indenture or certain defaults hereunder and their consequences)
provided for in this Indenture, or
(3) modify any of the provisions of this Section or
Section 513, except to increase any such percentage or to provide that
certain other provisions of this Indenture cannot be modified or
waived without the consent of the Holder of each Outstanding Debenture
affected thereby.
It shall not be necessary For any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it
shall be sufficient if such Act shall approve the substance thereof.
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SECTION 903. Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby
of the trusts created by this Indenture, the Trustee shall be entitled to
receive, and (subject to Section 601) shall be fully protected in relying upon,
an Opinion of Counsel stating that the execution of such supplemental indenture
is authorized or permitted by this Indenture. The Trustee may, but shall not
be obligated to, enter into any such supplemental indenture which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.
SECTION 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith and such supplemental
indenture shall form a part of this Indenture for all purposes; and every
Holder of Debentures theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby.
SECTION 905. Conformity with Trust indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act as then in effect.
SECTION 906. Reference in Debentures to Supplemental Indentures.
Debentures 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 Debentures so modified as to conform, in the opinion of the
Trustee and the Board of Directors, to any such supplement indenture may be
prepared and executed by the Company and authenticated and delivered by the
Trustee in exchange for Outstanding Debentures.
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ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium and Interest.
The Company will duly and punctually pay the principal of (and
premium, if any) and interest on the Debentures in accordance with the terms of
the Debentures and this Indenture.
SECTION 1002. Maintenance of Office or Agency.
The Company will maintain in the Borough of Manhattan, The City and
State of New York, and the City of Los Angeles, California, an office or agency
where Debentures may be presented or surrendered for payment, where Debentures
may be surrendered for registration of transfer or exchange for other
Debentures, where Debentures may be surrendered for conversion, where due bills
issued pursuant to Section 1301 may be presented for exchange for shares of
Common Stock and where notices and demands to or upon the Company in respect of
the Debentures and this Indenture may be served. The Company hereby initially
appoints the Trustee, its office or agency, for each of such purposes. The
Company will give prompt written notice to the Trustee of the location, and any
change in the location, of such office or agency. If at any time the Company
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee, and the Company hereby appoints the Trustee as its agent to receive
all such presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more other
offices or agencies (in or outside the Borough of Manhattan, The City and
State of New York and the City of Los Angeles, California) where the
Debentures may be presented or surrendered for any or all such purposes and may
from time to time rescind such designations provided, however, that no such
designation or rescission shall in any manner relieve the Company of its
obligation to maintain an office or agency in the Borough of Manhattan, The
City and State of New York and the City of Los Angeles, California for such
purposes. The Company will give prompt written notice to the Trustee of any
such designation or rescission and of any change in the location of any such
other office or agency.
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SECTION 1003. Money for Debenture Payments to Be Held in Trust.
If the Company shall at any time act as its own paying agent, it will,
on or before each due date of the principal of (and premium, if any) or
interest on any of the Debentures, segregate and hold in trust for the benefit
of the Persons entitled thereto a sum sufficient to pay the principal (and
premium, if any) or interest so becoming due until such sums shall be paid to
such Persons or otherwise disposed of as herein provided and will promptly
notify the Trustee of its action or failure so to act.
Whenever the Company shall have one or more Paying Agents, it will,
prior to each due date of the principal of (and premium, if any) or interest on
any Debentures, deposit with a Paying Agent a sum sufficient to pay the
principal (and premium, if any) or interest so becoming due, such sum to be
held in trust for the benefit of the Persons entitled to such principal,
premium or interest, and (unless such Paying Agent is the Trustee) the Company
will promptly notify the Trustee of its action or failure so to act.
The Company will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent will:
(1) hold all sums held by it for the payment of the
principal of (and premium, if any) or interest on Debentures in trust
for the benefit of the Persons entitled thereto until such sums shall
be paid to such Persons or otherwise disposed of as herein provided;
(2) give the Trustee notice of any default by the Company
(or any other obligor upon the Debentures) in the making of any
payment of principal (and premium, if any) or interest; and
(3) at any time during the continuance of any such
default, upon the written request of the Trustee, forthwith pay to the
Trustee all sums so held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held
in trust by the Company or such Paying Agent, such sums to be held by the
Trustee upon the same trusts as those upon which such sums were held
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by the Company or such Paying Agent; and, upon such payment by any Paying Agent
to the Trustee, such Paying Agent shall be released from all further liability
with respect to such money.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of (and premium, if
any) or interest on any Debenture and remaining unclaimed for two years after
such principal (and premium, if any) or interest has become due and payable
shall be paid to the Company on Company Request, or (if then held by the
Company) shall be discharged from such trust; and the Holder of such Debenture
shall thereafter, as an unsecured general creditor, look only to the Company
for payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; provided, however, that the Trustee or such
Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be mailed to Holders at last known address, or
to be published once, in a newspaper published in the English language,
customarily published on each Business Day and of general circulation in The
Borough of Manhattan, The City of New York, or mailed to each Holder, or both,
notice that such money remains unclaimed and that, after a date specified
therein, which shall not be less than 30 days from the date of such
publication, or mailing, any unclaimed balance of such money then remaining
will be repaid to the Company.
SECTION 1004. Corporate Existence.
Subject to Article Eight, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its corporate
existence and rights (charter and statutory).
SECTION 1005. Maintenance of Properties.
The Company will cause all properties used or useful in the conduct of
its business or the business of any Subsidiary, in each case which are material
to the Company and its Subsidiaries taken as a whole, to be maintained and kept
in good condition, repair and working order and supplied with all necessary
equipment and will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements
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thereof, all as in the judgment of the Company may be necessary so that the
business carried on in connection therewith may be properly and advantageously
conducted at all times; provided, however, that nothing in this Section shall
prevent the Company from discontinuing the operation or maintenance of any of
such properties if such discontinuance is, in the judgment of the Company,
desirable in the conduct of its business or the business of any Subsidiary and
not disadvantageous in any material respect to the Holders.
SECTION 1006. Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (1) all taxes, assessments and
governmental charges levied or imposed upon the Company or any Subsidiary or
upon the income, profits or property of the Company or any Subsidiary, and (2)
all lawful claims for labor, materials and supplies which, if unpaid, might by
law become a lien with respect to the Company and its Subsidiaries taken as a
whole; provided, however, that the Company shall not be required to pay or
discharge or cause to be paid or discharged any such tax or claim whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings or other appropriate action.
SECTION 1007. Statement by Officers as to Default.
The Company shall notify the Trustee within 5 days after the
occurrence thereof of any acceleration which with the giving of notice and the
lapse of Lime could become an Event of Default under Section 501(5). The
Company will deliver to the Trustee, within 120 days after the end of each
fiscal year of the Company ending after the date hereof, an Officers'
Certificate, stating whether or not to the best knowledge of the signers
thereof the Company is in default in the performance and observance of any of
the terms, provisions and conditions of this indenture, and if the Company
shall be in default, specifying all such defaults and the nature and status
thereof of which they may have knowledge.
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ARTICLE ELEVEN
REDEMPTION OF DEBENTURES
SECTION 1101. Right of Redemption.
The Debentures are not redeemable on or prior to April 15, 1987,
unless the last reported sale price for the Common Stock on each of any 20
trading days within the period of 30 consecutive trading days ending within
five business days of the date on which the notice of such redemption is given
to the Trustee equals or exceeds 140% of the conversion price then in effect as
provided in Sections 1301 and 1304. With respect to redemptions in that event
on or prior to April 15, 1987, and with respect to redemptions after April 15,
1987, the redemption may be made in whole, or from time to time in part, at the
option of the Company at the Redemption Price then applicable thereto as
specified in the form of Debenture hereinabove recited together with accrued
interest to the date fixed for redemption; provided, that if the date fixed for
redemption (including through the operation of the Sinking Fund hereinafter
provided for) is an Interest Payment Date, the interest payable on such date
shall, subject to exceptions provided in this Indenture, be paid to the person
in whose name the Debenture shall have been registered at the close of business
on the April 1 or October 1, as the case may be, next preceding such Interest
Payment Date, whether or not such April or October 1 is a Business Day.
SECTION 1102. Applicability of Article.
Redemption of Debentures at the election of the Company or otherwise,
as permitted or required by any provision of this Indenture, shall be made in
accordance with such provision and this Article.
SECTION 1103. Election to Redeem; Notice to Trustee.
The election of The Company to redeem any Debentures pursuant to
Section 1101 shall be evidenced by a Board Resolution. In case of any
redemption at the election of the Company of less than all of the Debentures,
the Company shall, at least 60 days prior to the Redemption Date fixed by the
Company (unless a shorter notice shall be satisfactory to the Trustee), notify
the Trustee of such Redemption Date and of the principal amount of Debentures
to be redeemed.
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SECTION 1104. Selection by Trustee of Debentures to Be Redeemed.
If less than all the Debentures are to be redeemed, the particular
Debentures to be redeemed shall be selected not more than 60 days prior to the
Redemption Date by the Trustee, from the Outstanding Debentures not previously
called for redemption, by such method as the Trustee shall deem fair and
appropriate and which may provide for the selection for redemption of portions
(equal to $1,000 or any integral multiple thereof) of the principal amount of
Debentures of a denomination larger than $1,000.
If any Debenture selected for partial redemption is converted in part
before termination of the conversion right with respect to the portion of the
Debenture so selected, the converted portion of such Debenture shall be deemed
(so far as may be) to be the portion selected for redemption. Debentures which
have been converted during a selection of Debentures to be redeemed shall be
treated by the Trustee as Outstanding for the purpose of such selection.
The Trustee shall promptly notify the Company and the Debenture
Registrar in writing of the Debentures selected for redemption and, in the case
of any Debenture selected for partial redemption, the principal amount thereof
to be redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Debentures shall relate,
in the case of any Debenture redeemed or to be redeemed only in part, to the
portion of the principal amount of such Debenture which has been or is to be
redeemed.
SECTION 1105. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption
Date, to each Holder of Debentures to be redeemed, at his address appearing in
the Debenture Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the Outstanding Debentures are to be
redeemed, the identification (and, in the case of partial redemption,
the principal amounts) of the particular Debentures to be redeemed,
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(4) that on the Redemption Date the Redemption Price will
become due and payable upon each such Debenture to be redeemed and
that interest thereon will cease to accrue on and after said date,
(5) the conversion price, the date on which the right to
convert the principal of the Debentures to be redeemed will terminate
and the place or places where such Debentures may be surrendered for
conversion,
(6) the place or places where such Debentures are to be
surrendered for payment of the Redemption Price, and
(7) that the redemption is for the sinking fund, if such
is the case.
Notice of redemption of Debentures to be redeemed at the election of
the Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company.
SECTION 1106. Deposit of Redemption Price.
Prior to any Redemption Date, the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 1003) an amount of
money sufficient to pay the Redemption Price of, and (except if the Redemption
Date shall be an Interest Payment Date) accrued interest on, all the Debentures
which are to be redeemed on that date other than any Debentures called for
redemption on that date which have been converted prior to the date of such
deposit.
If any Debenture called for redemption is so converted, any money
deposited with the Trustee or with any Paying Agent or so segregated and held
in trust for the redemption of such Debenture shall (subject to any right of
the Holder of such Debenture or any Predecessor Debenture to receive interest
as provided in the last paragraph of Section 307) be paid to the Company upon
Company Request or, if then held by the Company, shall be discharged from such
trust.
SECTION 1107. Debentures Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Debentures so
to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified and from and after such date
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(unless the Company shall default in the payment of the Redemption Price and
accrued interest) such Debentures shall cease to bear interest. Upon surrender
of any such Debenture for redemption in accordance with said notice, such
Debenture shall be paid by the Company at the Redemption Price, together with
accrued interest to the redemption date; provided, however, that installments
of interest whose Stated Maturity is on or prior to the Redemption Date shall be
payable to the Holders of such Debentures, or one or more Predecessor
Debentures, registered as such at the close of business on the relevant Record
Dates according to their terms and the provisions of Section 307.
If any Debenture called for redemption shall not be so paid upon
surrender thereof for redemption, the principal (and premium, if any) shall,
until paid, bear interest from the Redemption Date at the rate borne by the
Debenture.
SECTION 1108. Debentures Redeemed in Part.
Any Debenture which is to be redeemed only in part shall be
surrendered at the office or agency of the Company designated for that purpose
pursuant to Section 1002 (with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing), and the Company shall execute and the Trustee
shall authenticate and deliver to the Holder of such Debenture, without service
charge, a new Debenture or Debentures, of any authorized denomination as
requested by such Holder, in aggregate principal amount equal to and in
exchange for the unredeemed portion of the principal of the Debentures so
surrendered.
ARTICLE TWELVE
SINKING FUND
SECTION 1201. Sinking Fund Payments.
As and for a sinking fund for the retirement of the Debentures, the
Company will until all Debentures are paid or payment thereof provided for,
deposit in accordance with Section 1106, on or prior to April 15 in each
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year, commencing in 1996 and ending in 2009, an amount in cash sufficient to
redeem on such April 15 $2,000,000 in aggregate principal amount of Debentures
in each case at the Redemption Price specified in the form of Debenture
hereinbefore set forth for redemption through operation of the sinking fund.
The amount of the sinking fund payment as specified in this Section is herein
referred to as a "mandatory sinking fund payment." The cash amount of any
mandatory sinking fund payment is subject to reduction as provided in Section
1202 and the Company shall specify the amount of such reduction in the
Officers' Certificate delivered pursuant to Section 1203. Each sinking fund
payment shall be applied to the redemption of Debentures on such April 15, as
herein provided.
SECTION 1202. Satisfaction of Sinking Fund Payments with Debentures.
The Company (1) may deliver Outstanding Debentures (other than any
previously called for redemption) for a mandatory sinking fund payment and (2)
may apply as a credit Debentures which have been redeemed at the election of
the Company pursuant to Section 1101, or converted or otherwise acquired and
not previously credited in each case in satisfaction of all or any part of any
mandatory sinking fund payment required to be made pursuant to Section 1201,
provided that such Debentures have not been previously so credited. Each such
Debenture shall be received and credited for such purpose by the Trustee at the
Redemption Price specified in the form of Debenture hereinbefore set forth for
redemption through operation of the sinking fund and the amount of such
mandatory sinking fund payment shall be reduced accordingly.
SECTION 1203. Redemption of Debentures for Sinking Fund.
On or before March 1 in each year commencing with the year 1996 and
ending in 2009, the Company will deliver to the Trustee an Officers'
Certificate specifying the amount of the next ensuing sinking fund payment
pursuant to Section 1201, the portion thereof, if any, which is to be satisfied
by payment of cash and the portion thereof, if any, which is to be satisfied by
delivering and crediting Debentures pursuant to Section 1202 and will also
deliver to the Trustee any Debentures to be so delivered. Before March 15 in
each such year the Trustee shall select the Debentures to be redeemed upon the
next ensuing April 15 in the manner specified in Section 1104 and cause notice
of the redemption thereof to be given in the name of and at the
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expense of the Company in the manner provided in Section 1105. Such notice
having been duly given, the redemption of such Debentures shall be made upon
the terms and in the manner stated in Sections 1107 and 1108.
ARTICLE THIRTEEN
CONVERSION OF DEBENTURES
SECTION 1301. Conversion Privilege and Conversion Price.
Subject to and upon compliance with the provisions of this Article, at
the option of the Holder thereof, any Debenture or any portion of the principal
amount thereof which is $1,000 or an integral multiple of $1,000 may be
converted at the principal amount thereof, or of such portion thereof, into
fully paid and nonassessable shares (calculated as to each conversion to the
nearest 1/100 of a share) of Common Stock of the Company, at the conversion
price, determined as hereinafter provided, in effect at the time of conversion.
Such conversion right shall expire at the close of business on April 15, 2010.
In case a Debenture or portion thereof is called for redemption, such
conversion right in respect of the Debenture or portion so called shall expire
at the close of business on the fifth day prior to the Redemption Date, unless
the Company defaults in making the payment due upon redemption.
The price at which shares of Common Stock shall be delivered upon
conversion (herein called the "conversion price") shall be initially $35 per
share of Common Stock. The conversion price shall be adjusted in certain
instances as provided in paragraphs (1), (2), (3), (4), (7), (8) and (9) of
Section 1304.
Notwithstanding the foregoing, in addition to the shares of Common
Stock issued in connection with the conversion of any Debenture or portion
thereof surrendered prior to the close of business on May 2, 1985, the Trustee
shall deliver to the holder of such Debenture a due bill evidencing such
Holder's right to receive on May 3, 1985 a number of shares of Common Stock
equal to the number of additional shares of Common Stock which such Holder
would be entitled to receive if such Debenture or portion thereof were
converted on May 3, 1985 (without giving effect to any adjustment of the
conversion price pursuant to this Article other than the adjustment referred to
in paragraph (9) of Section 1304). Any such due bill may be presented at any
office or agency of the Company maintained for that purpose pursuant to Section
1002 on or after May 3, 1985 for exchange for the shares of Common Stock
covered thereby.
SECTION 1302. Exercise of Conversion Privilege.
In order to exercise the conversion privilege, the Holder of any
Debenture to be converted shall surrender such Debenture, duly endorsed or
assigned to the Company or in blank, at any office or agency of the Company
maintained for that purpose pursuant to Section 1002, accompanied by written
notice to the Company at such office or agency that the Holder elects to
convert such Debenture or, if less than the entire principal amount thereof is
to be converted, the portion thereof to be converted. Such notice shall also
state the name or names (with address and social security number or other
taxpayer identification number) in which said certificate or certificates
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are to be issued. Debentures surrendered for conversion during the period from
the close of business on any Regular Record Date next preceding any Interest
Payment Date to the opening of business on such Interest Payment Date shall
(except in the case of Debentures or portions thereof which have been called
for redemption on a Redemption Date within such period) be accompanied by
payment in New York clearing house funds or other funds acceptable to the
Company of an amount equal to the interest payable on such Interest Payment
Date on the principal amount of Debentures being surrendered for conversion.
Except as provided in the preceding sentence and subject to the fourth
paragraph of Section 307, no payment or adjustment shall be made upon any
conversion on account of any interest accrued on the Debentures surrendered for
conversion or on account of any dividends on the Common Stock issued upon
conversion.
Debentures shall be deemed to have been converted immediately prior to
the close of business on the day of surrender of such Debentures for conversion
in accordance with the foregoing provisions, and at such time the rights of the
Holders of such Debentures as Holders shall cease, and the person or persons
entitled to receive the Common Stock or due bills referred to in Section 1301
issuable upon conversion shall be treated for all purposes as the record holder
or holders of such Common Stock or due bills, as the case may be, at such time.
As promptly as practicable on or after the conversion date, the Company shall
issue and shall deliver at such office or agency to or upon the written order
of the Holder of the Debenture or Debentures surrendered a certificate or
certificates for the number of full shares of Common Stock issuable upon
conversion (but excluding any shares issuable in respect of any such due bill),
together with payment in lieu of any fraction of a share, as provided in
Section 1303. On May 3, 1985, or as promptly thereafter as possible the
Company shall issue and shall deliver at such office or agency, to or upon the
written order of the holder of the due bills surrendered, a certificate or
certificates for the number of full shares of Common Stock issuable upon
exchange for such due bill or due bills, together with payment in lieu of any
fraction of a share as provided in Section 1303.
In the case of any Debenture which is converted in part only, upon
such conversion the Company shall execute and the Trustee shall authenticate
and deliver to the Holder thereof, at the expense of the Company, a new
Debenture or Debentures of authorized denominations in aggregate principal
amount equal to the unconverted portion of the principal amount of such
Debenture.
SECTION 1303. Fractions of Shares.
No fractional shares of Common Stock shall be issued upon conversion
of Debentures. If more than one Debenture shall be surrendered for conversion
at one time by the same Holder, the number of full shares which shall be
issuable upon conversion thereof shall be computed on the basis of
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the aggregate principal amount of the Debentures (or specified portions
thereof) so surrendered. Instead of any fractional share of Common Stock which
would otherwise be issuable upon conversion of any Debenture or Debentures (or
specified portions thereof), the Company shall pay a cash adjustment in respect
of such fraction in an amount equal to the same fraction of the market price
per share of Common Stock (as determined by the Board of Directors or in any
manner prescribed by the Board of Directors) at the close of business on the day
of conversion.
SECTION 1304. Adjustment of Conversion Price.
(1) In case the Company shall pay or make a dividend or other
distribution on any class of capital stock of the Company in Common Stock
(other than the dividend referred to in paragraph (9) of this Section 1304),
the conversion price in effect at the opening of business on the day following
the date fixed for the determination of stockholders 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. For the purposes of
this paragraph (1) and paragraph (9) of this Section 1304, 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 pay any dividend or make any distribution on shares of Common
Stock held in the treasury of the Company.
(2) In case the Company shall issue rights or warrants to all
holders of its Common Stock entitling them to subscribe for or purchase shares
of Common Stock at a price per share less than the current market price per
share (determined as provided in paragraph (6) of this Section) of the Common
Stock on the date fixed for the determination of stockholders entitled to
receive such rights or warrants, the conversion price in 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
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determination plus the number of shares of Common Stock which the aggregate of
the offering 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. 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) In case outstanding shares of Common Stock shall be subdivided
into a greater number of shares of Common Stock, the conversion price 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 of Common Stock, the conversion price 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) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock evidences of its indebtedness or
assets (including securities, but excluding any rights or warrants referred to
in paragraph (2) of this Section, any dividend or distribution paid in cash out
of the retained earnings of the Company and any dividend or distribution
referred to in paragraph (1) or paragraph (9) of this Section), the conversion
price shall be adjusted so that the same shall equal the price determined by
multiplying the conversion price in effect immediately prior to the close of
business on the date fixed for the determination of stockholders 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 Common Stock on the
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date fixed for such determination less the then fair market value (as
determined by the Board of Directors, whose determination shall be conclusive
and described in a Board Resolution filed with the Trustee) of the portion of
the assets or evidences of indebtedness so distributed applicable to one share
of Common Stock and the denominator shall be such current market price per
share of the 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 stockholders entitled to receive such distribution.
(5) The reclassification of Common Stock into securities other
than Common Stock (other than any reclassification upon a consolidation or
merger to which Section 1311 applies) shall be deemed to involve (a) a
distribution of such securities other than Common Stock to all holders of
Common Stock (and the effective date of such reclassification shall be deemed to
be "the date fixed for the determination of stockholders entitled to receive
such distribution" and "the date fixed for such determination" within the
meaning of paragraph (4) of this Section), and (b) a subdivision or
combination, as the case may be, of the number of shares of Common Stock
outstanding immediately prior to such reclassification into the number of
shares of Common Stock outstanding immediately thereafter (and the effective
date of such reclassification shall be deemed to be "the day upon which such
subdivision becomes effective" or "the day upon which such combination becomes
effective", as the case may be, and "the day upon which such subdivision or
combination becomes effective" within the meaning of paragraph (3) of this
Section).
(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 less than 20
nor more than 30 Business Days before the day in question.
(7) No adjustment in the conversion price shall be required unless
such adjustment would require an increase or decrease of at least 1% in such
price; provided, however, that any adjustment which by reason of this paragraph
(7) is not required to be made shall be carried forward and taken into account
in any subsequent adjustment; and provided, further, that adjustment shall be
required and shall be made in accordance with the provisions of this Section
(other than this paragraph (7)) not later than
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such time as may be required in order to preserve the tax-free nature of a
distribution to the Holder of any Debenture. All calculations under this
paragraph (7) shall be made to the nearest cent.
(8) The Company may make such reductions in the conversion price,
in addition to those required by paragraphs (1), (2), (3) and (4) of this
Section, as it considers to be advisable in order than any event created for
Federal income tax purposes as a dividend of stock or stock rights shall not be
taxable to the recipients.
(9) As of the opening of business on May 3, 1985, the conversion
price will be reduced by multiplying such conversion price by 2/3 to reflect a
three-for-two stock split in the form of a fifty percent stock dividend on each
share of outstanding Common Stock of the Company payable on May 3, 1985 to all
stockholders of record on April 10, 1985.
SECTION 1305. Notice of Adjustments of Conversion Price.
Whenever the conversion price is adjusted as herein provided:
(a) the Company shall compute the adjusted conversion
price in accordance with Section 1304 and shall prepare a certificate
signed by the Treasurer of the Company setting forth the adjusted
conversion price and showing in reasonable detail the facts upon which
such adjustment is based, and such certificate shall forthwith be
filed at each office or agency maintained for the purpose of
conversion of Debentures pursuant to Section 1002; and
(b) a notice stating that the conversion price has been
adjusted and setting forth the adjusted conversion price shall
forthwith be required, and as soon as practicable after it is
required, such notice shall be mailed by the Company to the Trustee
and all Holders at their last addresses as they shall appear in the
Debenture Register.
SECTION 1306. Notice of Certain Corporate Action.
In case:
(a) the Company shall declare a dividend (or any other
distribution) on its Common Stock payable otherwise than in cash out
of its earned surplus (other than the dividend referred to in
paragraph (9) of Section 1304); or
(b) the Company shall authorize the granting to the
holders of its Common Stock of rights or warrants to subscribe for or
purchase any shares of capital stock of any class or of any other
rights; or
(c) of any reclassification of the Common Stock of the
Company (other than a subdivision or, combination of its outstanding
shares of
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Common Stock), or of any consolidation or merger to which the Company
is a party and for which approval of any stockholders of the Company
is required, or of the sale or transfer of all or substantially all of
the assets of the Company; or
(d) 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 Debentures pursuant to Section 1002, and shall
cause to be mailed to all Holders at their last addresses as they shall appear
in the Debenture 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 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
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.
SECTION 1307. Company to Reserve Common Stock.
The Company shall at all times reserve and keep available, free from
pre-emptive rights, out of its authorized but unissued Common Stock, for the
purpose of effecting the conversion of Debentures, the full number of shares of
Common Stock then issuable upon the conversion of all Outstanding Debentures
including shares issuable upon presentation of any due bill issued pursuant to
Section 1301.
SECTION 1308. Taxes on Conversions.
The Company will pay any and all taxes that may be payable in respect
of the issue or delivery of shares of Common Stock on conversion of Debentures
or in exchange for any due bills pursuant hereto. The Company shall nor
however, be required to pay any tax which may be payable in respect of any
transfer involved in the issue and delivery of shares of
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Common Stock a name other than that of the Holder of the Debenture or
Debentures to be converted, and no such issue or delivery shall be made unless
and until the person requesting such issue 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 1309. Covenant as to Common Stock.
The Company covenants that all shares of Common Stock which may be
issued upon conversion of Debentures or in exchange for any due bills will upon
issue be fully paid and, nonassessable and, except as provided in Section 1308,
the Company will pay all taxes, liens and charges with respect to the issue
thereof.
SECTION 1310. Cancellation of Converted Debentures.
All Debentures delivered for conversion shall be delivered to The
Trustee to be cancelled by or at the direction of the Trustee, which shall
dispose of the same as provided in Section 309.
SECTION 1311. 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 in case of any merger of another
corporation into the Company (other than a merger which does not result in any
reclassification, conversion, exchange or 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 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 Debenture then outstanding shall
have the right thereafter, during the period such Debenture shall be
convertible as specified in Section 1301, to convert such Debenture 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 Debenture 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
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Article. The above provisions of this Section shall similarly apply to
successive consolidations, mergers, sales or transfers.
(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 Debentures after
any such reclassification, change, consolidation, merger, sale or conveyance or
to any adjustment to be made with respect thereto.
SECTION 1312. 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 Debentures to determine whether any facts exist which may
require any adjustment of the conversion price, 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 Debenture: 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 Debenture for the
purpose of conversion or, subject to Section 601, to comply with any of the
covenants of the Company contained in this Article.
ARTICLE FOURTEEN
SUBORDINATION OF DEBENTURES
SECTION 1401. Agreement to Subordinate.
The Company covenants and agrees, and each Holder of Debentures, by
his acceptance thereof, likewise covenants and agrees, that the indebtedness
represented by the Debentures and the payment of the principal of (and premium,
if any) and interest on each and all of the Debentures is hereby expressly
subordinated and subject in right of payment, to the extent and in the manner
hereinafter set forth, to the prior payment in full of all Senior Indebtedness,
or provision for such payment.
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For the purposes of this Article the term "Senior Indebtedness" means
principal of (and premium, if any) and unpaid interest on (a) indebtedness
(secured or unsecured) incurred, assumed or guaranteed by the Company either
before, on or after the date of this Indenture and which is for money borrowed,
or which is evidenced by notes, debentures, bonds or other similar securities
whether or not for money borrowed, and (b) renewals, extensions or refundings
of any such indebtedness, unless it is provided by the instrument creating,
evidencing, renewing, extending or refunding the same or pursuant to which the
same is outstanding, that such indebtedness is not senior in right of payment
to the Debentures.
SECTION 1402. Payment Prohibited If Senior Indebtedness in Default.
No payment on account of principal, premium (if any) or interest on,
or sinking fund payments for, the Debentures shall be made, nor shall any
property or assets be applied to the purchase or other acquisition or
retirement of the Debentures, unless full payment of amounts due for principal,
premium (if any), sinking funds, and interest on Senior Indebtedness has been
made or duly provided for in money or money's worth, provided, however, that
nothing in this Article Fourteen shall prevent the conversion of Debentures or
the giving of any notice of redemption of Debentures required pursuant to
Section 1203 or the credit of Debentures against any sinking fund payment
pursuant to Section 1202.
SECTION 1403. Priority of Senior Indebtedness.
Upon any payment 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 total or partial liquidation, rehabilitation or
reorganization of the Company, whether voluntary or involuntary or in
bankruptcy, insolvency, rehabilitation, receivership or other proceedings, all
principal premium (if any) and interest due upon all Senior Indebtedness shall
first be paid in full, or payment thereof provided for in money or money's
worth, before the Holders of the indebtedness evidenced by the Debentures or
the Trustee on their behalf shall be entitled to receive or retain any assets
so paid or distributed in respect thereof (for principal, premium (if any) or
interest) or of this Indenture; and upon any such dissolution or winding up or
liquidation, rehabilitation or reorganization, any payment or distribution of
assets of the Company of any kind or
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character, whether in cash, property or securities, to which the Holders of the
Debentures or the Trustee on their behalf 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, or by the Holders of the Debentures or by the Trustee
on their behalf if received by them or it, direct to the holders of Senior
Indebtedness (pro rata to each such holder on the basis of the respective
amounts of Senior Indebtedness held by such holder) or their representatives,
to the extent necessary to pay all Senior Indebtedness in full, in money or
money's worth, 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 indebtedness evidenced by the Debentures or to
the Trustee on their behalf.
SECTION 1404. Subrogation of Holders of Debentures.
No payment or distribution of assets of the Company to which the
Holders of the Debentures or the Trustee on their behalf would have been
entitled except for the provisions of this Article and which shall have been
received by the holders of Senior Indebtedness or their representative or
representatives, or by the trustee or trustees under any indenture pursuant to
which any instruments evidencing any of such Senior Indebtedness may have been
issued, shall, as between the Company, its creditors, and the Holders of
Debentures, be deemed to be a payment by the Company to holders of the Senior
Indebtedness or on account thereof, and, subject to the payment in full of all
Senior Indebtedness, or provisions for payment thereof in cash, the Holders of
the Debentures shall be subrogated to the rights of the Holders of Senior
indebtedness to receive payments or distributions of assets of tile Company
applicable to Senior Indebtedness until the principal of (and premium if any)
and interest on the Debentures shall be paid in full, and no such payments or
distributions to the Holders of the Debentures of cash, property or securities,
which otherwise would be payable or distributable to holders of Senior
Indebtedness shall, as between the Company, its creditors other than the
holders of Senior Indebtedness, and the Holders of Debentures, be deemed to be
a payment by the Company to the Holders of Debentures or on account of the
Debentures.
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SECTION 1405. Subordination of Debentures Not Affected by Changes in
Provisions of Senior Indebtedness.
The subordination of the Debentures in accordance with this Article
shall not be affected or released by any amendment, modification, change,
consent or waiver with respect to any Senior Indebtedness or any agreement
under which any Senior Indebtedness may be issued, or by any extension or
indulgence or surrender, substitution, alteration, or discharge of any
security.
SECTION 1406. Subordination Provisions for Benefit of Holders of Senior
Indebtedness.
The foregoing provisions are solely for the purpose of defining the
relative rights of the holders of Senior Indebtedness on the one hand and the
Holders of Debentures on the other hand, and such provisions shall be for the
benefit of such Persons and may be enforced directly by them against the
Holders of Debentures or the Trustee; provided, however, that the Trustee,
shall not be deemed to owe any fiduciary duty to holders of Senior
Indebtedness, and shall not be liable to any such Person if it shall mistakenly
pay over or distribute to Holders of Debentures or the Company or any other
Person moneys or assets to which any such holder of Senior Indebtedness shall
be entitled by virtue of this Article or otherwise.
SECTION 1407. Rights of Trustee as Holder of Senior Indebtedness.
The Trustee shall be entitled to all of the rights set forth in this
Article in respect of any Senior Indebtedness which may be at any time held by
it to the same extent as any other holder of Senior Indebtedness and nothing in
Section 613 or elsewhere in this Indenture shall be construed to deprive the
Trustee of any of its rights as such holder.
SECTION 1408. Obligation of the Company to Holders of Debentures Not Impaired.
Nothing contained in this Article or elsewhere in this Indenture or in
the Debentures is intended to or shall impair, as between the Company, its
creditors, other than holders of Senior Indebtedness, and the Holders of the
Debentures, the obligation of the Company, which is absolute and unconditional
to pay to the Holders of the Debentures the principal of (and premium if any)
and interest on the Debentures as and when the same shall
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become due and payable in accordance with their terms, or is intended to or
shall affect the relative rights of the Holders of the Debentures and creditors
of the Company, other than holders of Senior Indebtedness, nor shall anything
herein or therein prevent the Trustee or the Holder of any Debenture from
exercising all remedies otherwise permitted by applicable law upon default
under this Indenture, subject to the rights, if any, under this Article of
holders of Senior Indebtedness in respect of cash, property or securities of
the Company received upon the exercise of any such remedy.
SECTION 1409. Reliance Upon Court Order or Decree.
Upon any distribution of assets of the Company referred to in this
Article, the Trustee, subject to the provisions of Section 601, and the Holders
of the Debentures shall be entitled to rely upon any order or decree made by
any court of competent jurisdiction in which such dissolution, winding up,
liquidation, rehabilitation or reorganization proceedings are pending, or a
certificate of the liquidating trustee or agent or other Person making such
distribution, delivered to the Trustee or to the Holders of the Debentures, for
the purpose of ascertaining the Persons entitled to participate in such
distribution, including 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 1410. Subordination Rights Not Impaired by Acts or Omissions of
Company or Holders of Senior Indebtedness.
No right of any present or future holder of 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
or by any act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Company with the terms, provisions and covenants of this
Indenture, regardless of any knowledge thereof which any such older may have or
be otherwise charged with.
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SECTION 1411. Trustee to Effectuate Subordination.
Each Holder of the Debentures by his acceptance thereof authorizes and
directs the Trustee in his behalf to take such action as may be necessary or
appropriate to effectuate the subordination provided in this Article and
appoints the Trustee his attorney-in-fact for any and all such purposes.
SECTION 1412. Trustee Not Charged With Knowledge of Senior Indebtedness.
Subject to the provisions of Section 601, the Trustee shall not be
charged with knowledge of the existence of any facts or conditions which would
prohibit the making of any payment of moneys to or by the Trustee, unless and
until the Trustee shall have received written notice thereof from the Company
or from one or more holders of Senior Indebtedness, or from a representative
for such holder, nor shall the Trustee be charged with knowledge of the curing
of any such default or of the elimination of the fact or condition preventing
any such payment unless and until the Trustee shall have received an Officers'
Certificate to such effect, provided, that, if prior to the opening of business
on the Business Day next prior to the date upon which by the terms hereof any
such moneys may become payable for any purpose (including, without limitation,
the payment of either the principal (or premium, if any) or interest on any
Debenture) the Trustee shall not have received with respect to such moneys the
notice provided for in this Section 1412, then, anything herein contained to
the contrary notwithstanding, the Trustee shall have 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 on or after such date.
SECTION 1413. Events of Default Not Prevented.
The provisions of this Article, and reference in the Debentures to the
subordination provisions herein contained, shall not be construed as preventing
the occurrence of any Event of Default under Section 501.
* * * *
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
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[OFFICIAL SEAL]
State of California )
) ss.:
County of Los Angeles )
On the 24th day of April, 1985, before me personally came Merrill Lyons,
to me known, who, being by me duly sworn, did depose and say that he is a Senior
Vice President, Secretary and Chief Financial Officer of The Federated Group
Inc., one of the corporations described in and which executed the foregoing
instrument; that he knows the seal of said corporation; that the seal affixed to
said instrument is such corporate seal; that it was so affixed by authority of
the Board of Directors of said corporation, and that he signed his name thereto
by like authority.
/s/ DONNA M. SIEFERT
-----------------------
Notary Public
[OFFICIAL SEAL]
State of California )
) ss.:
County of Los Angeles )
On the 25th day of April, 1985, before me personally came Cynthia
Dillard, to me known, who, being by me duly sworn, did depose and say that she
is Assistant Vice President of Security Pacific National Bank, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation, and that he signed his name thereto by like
authority.
/s/ SHARON L. JACOBSON
-------------------------
Notary Public
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
THE FEDERATED GROUP, INC.
By /s/ Merrill Lyons
--------------------------------
Senior Vice President Finance
Attest:
SECURITY PACIFIC NATIONAL BANK
AS TRUSTEE
By /s/ Cynthia Dillard
--------------------------------
Assistant Vice President