EXHIBIT 4.1
-----------------------
SOUTHWEST AIRLINES CO.
AND
▇▇▇▇▇ FARGO BANK, N.A.,
TRUSTEE
-----------------------
INDENTURE
Dated as of __________, 200__
-----------------------
TABLE OF CONTENTS
Page
PARTIES 1
RECITALS:
Purpose of Indenture 1
Compliance with Legal Requirements 1
Purpose of and Consideration for Indenture 1
ARTICLE ONE
DEFINITIONS
SECTION 1.01. Certain Terms Defined 1
Affiliate 2
Bankruptcy Code 2
Board of Directors 2
Business Day 2
Commission 2
Company 2
Depositary 2
Event of Default 2
Global Security 2
Indenture 3
Interest 3
Officers' Certificate 3
Opinion of Counsel 3
Original Issue Discount Security 3
Outstanding 3
Paying Agent 4
Responsible Officer 4
Security or Securities 4
Securityholder 4
Subsidiary 4
Trustee; principal office 4
Trust Indenture Act of 1939 4
Yield to Maturity 5
SECTION 1.02. References are to Indenture 5
SECTION 1.03. Conflict with Trust Indenture Act of 1939 5
ARTICLE TWO
ISSUE, DESCRIPTION, EXECUTION, REGISTRATION
AND EXCHANGE OF SECURITIES
i
SECTION 2.01. Forms Generally 5
SECTION 2.02. Form of Trustee's Certificate of Authentication 5
SECTION 2.03. Amount Unlimited; Issuable in Series 6
SECTION 2.04. Authentication and Delivery of Securities 7
SECTION 2.05. Execution of Securities 8
SECTION 2.06. Exchange of Securities 9
SECTION 2.07. Temporary Securities 10
SECTION 2.08. Mutilated, Destroyed, Lost or Stolen Securities 11
SECTION 2.09. Cancellation of Surrendered Securities 11
SECTION 2.10. Securities in Global Form 12
ARTICLE THREE
PARTICULAR COVENANTS OF THE COMPANY
SECTION 3.01. Payment of Principal of (and Premium, if any) and Interest on
Securities 12
SECTION 3.02. Maintenance of Office or Agency for Registration of Transfer,
Exchange and Payment of Securities 13
SECTION 3.03. Appointment to Fill a Vacancy in the Office of Trustee 13
SECTION 3.04. Provision as to Paying Agent 13
SECTION 3.05. Maintenance of Corporate Existence 14
SECTION 3.06. Officers' Certificate as to Default 14
SECTION 3.07. Further Assurance 14
ARTICLE FOUR
SECURITYHOLDERS' LISTS AND REPORTS BY THE COMPANY
AND THE TRUSTEE
SECTION 4.01. Company to Furnish Trustee Information as to Names and Addresses
to Securityholders 14
SECTION 4.02. Preservation and Disclosure of Lists 15
SECTION 4.03. Reports by the Company 15
SECTION 4.04. Reports by the Trustee 16
ARTICLE FIVE
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 5.01 Events of Default Defined; Acceleration of Maturity; Waiver of
Default 17
SECTION 5.02. Payment of Securities on Default; Suit Therefor 19
SECTION 5.03. Application of Moneys Collected by Trustee 20
SECTION 5.04. Limitation on Suits by Holders of Securities 21
SECTION 5.05. Proceedings by Trustee; Remedies Cumulative and Continuing 22
SECTION 5.06. Rights of Holders of Majority in Principal Amount of Securities to
Direct Trustee and to Waive Defaults 22
ii
SECTION 5.07. Trustee to Give Notice of Defaults Known to It, But May Withhold in
Certain Circumstances 23
SECTION 5.08 Requirement of an Undertaking to Pay Costs in Certain Suits Under
this Indenture or Against the Trustee 23
ARTICLE SIX
CONCERNING THE TRUSTEE
SECTION 6.01. Duties and Responsibilities of Trustee 23
SECTION 6.02. Reliance on Documents, Opinions, etc. 25
SECTION 6.03. No Responsibility for Recitals, etc. 26
SECTION 6.04. Trustee, Paying Agent or Security Registrar May Own Securities 26
SECTION 6.05. Moneys Received by Trustee to be Held in Trust Without Interest 26
SECTION 6.06. Compensation and Expenses of Trustee 26
SECTION 6.07. Right of Trustee to Rely on Officers' Certificate Where No Other
Evidence Specifically Prescribed 27
SECTION 6.08. Conflicting Interest of Trustee 27
SECTION 6.09. Requirements for Eligibility of Trustee 27
SECTION 6.10. Resignation or Removal of Trustee 28
SECTION 6.11. Acceptance by Successor to Trustee; Notice of Succession of a
Trustee 29
SECTION 6.12. Successor to Trustee by Merger, Consolidation or Succession to
Business 30
SECTION 6.13. Limitations on Rights of Trustee as a Creditor 30
ARTICLE SEVEN
CONCERNING THE SECURITYHOLDERS
SECTION 7.01. Evidence of Action by Securityholders 30
SECTION 7.02. Proof of Execution of Instruments and of Holding of Securities 31
SECTION 7.03. Who May be Deemed Owners of Securities 31
SECTION 7.04. Securities Owned by Company or Controlled or Controlling Persons
Disregarded for Certain Purposes 31
SECTION 7.05. Record Date for Action by Securityholders 32
SECTION 7.06. Instruments Executed by Securityholders Bind Future Holders 32
ARTICLE EIGHT
SECURITYHOLDERS' MEETINGS
SECTION 8.01. Purposes for Which Meetings May be Called 33
SECTION 8.02. Manner of Calling Meetings; Record Date 33
SECTION 8.03. Call of Meeting by Company or Securityholders 34
SECTION 8.04. Who May Attend and Vote at Meetings 34
SECTION 8.05. Regulations 34
SECTION 8.06. Manner of Voting at Meetings and Record to be Kept 35
SECTION 8.07. Exercise of Rights of Trustee and Securityholders Not to be Hindered
or Delayed 35
iii
SECTION 8.08. Written Consent in Lieu of Meeting of Securityholders 36
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 9.01. Purposes for Which Supplemental Indentures May be Entered into
Without Consent of Securityholders 36
SECTION 9.02. Modification of Indenture with Consent of Holders of a Majority in
Principal Amount of Securities 37
SECTION 9.03. Effect of Supplemental Indentures 38
SECTION 9.04. Securities May Bear Notation of Changes by Supplemental Indentures 38
SECTION 9.05. Opinion of Counsel 38
ARTICLE TEN
CONSOLIDATION, MERGER AND SALE
SECTION 10.01. Company May Consolidate, etc., on Certain Terms 39
SECTION 10.02. Successor to be Substituted 39
ARTICLE ELEVEN
SATISFACTION AND DISCHARGE OF INDENTURE;
UNCLAIMED MONEYS
SECTION 11.01. Satisfaction and Discharge of Indenture 40
SECTION 11.02. Application by Trustee of Funds Deposited for Payment of Securities 41
SECTION 11.03. Repayment of Moneys Held by Paying Agent 41
SECTION 11.04. Repayment of Moneys Held by Trustee 41
SECTION 11.05. Satisfaction, Discharge and Defeasance of Securities of any Series 42
ARTICLE TWELVE
IMMUNITY OF INCORPORATORS, SHAREHOLDERS, OFFICERS
AND OTHERS
SECTION 12.01. Incorporators, Shareholders, Officers and Others Exempt from
Individual Liability 44
ARTICLE THIRTEEN
MISCELLANEOUS PROVISIONS
SECTION 13.01. Successors and Assigns of Company Bound by Indenture 44
SECTION 13.02. Acts of Board, Committee or Officer of Successor Entity Valid 44
SECTION 13.03. Required Notices or Demands May be Served by Mail; Waiver 44
SECTION 13.04. Indenture and Securities to be Construed in Accordance with the
Laws of the State of Texas 45
iv
SECTION 13.05. Evidence of Compliance with Conditions Precedent 45
SECTION 13.06. Payments Due on Saturdays, Sundays, and Holidays 46
SECTION 13.07. Provisions Required by Trust Indenture Act of 1939 to Control 46
SECTION 13.08. Provisions of this Indenture and Security for the Sole Benefit of the
Parties and the Securityholders 46
SECTION 13.09. Indenture May be Executed in Counterparts 47
SECTION 13.10. Article and Section Headings 47
SECTION 13.11. Severability 47
ARTICLE FOURTEEN
REDEMPTION OF SECURITIES AND SINKING FUNDS
SECTION 14.01. Applicability of Article 47
SECTION 14.02. Notice of Redemption; Partial Redemptions 47
SECTION 14.03. Payment of Securities Called for Redemption 48
SECTION 14.04. Exclusion of Certain Securities from Eligibility for Selection for
Redemption. 49
SECTION 14.05. Mandatory and Optional Sinking Funds 49
v
THIS INDENTURE, dated as of ____________________, 200___, between
Southwest Airlines Co., a corporation duly organized and existing under the laws
of the State of Texas (hereinafter sometimes referred to as the "Company"),
party of the first part, and ▇▇▇▇▇ Fargo Bank, N.A., a national banking
association (hereinafter sometimes referred to as the "Trustee"), party of the
second part;
WITNESSETH:
WHEREAS, for its lawful corporate purposes, the Company has duly
authorized the issue from time to time of its debentures, notes or other
unsecured evidences of indebtedness, which are to be issued in one or more
series (the "Securities"), each such series ranking pari passu with each other
series in contractual right of payment, as unsecured obligations of the Company,
up to such principal amount or amounts as may from time to time be authorized in
accordance with the terms of this Indenture; and to provide, among other things,
for the authentication, delivery and administration thereof, the Company has
duly authorized the execution of this Indenture; and
WHEREAS, all acts and things necessary to make the Securities, when
executed by the Company and authenticated and delivered by the Trustee as in
this Indenture provided, the valid, binding and legal obligations of the
Company, and to constitute these presents a valid indenture and agreement
according to its terms, have been done and performed, and the execution of this
Indenture and the issue hereunder of the Securities have in all respects been
duly authorized, and the Company, in the exercise of the legal right and power
vested in it, executes this Indenture and proposes to make, execute, issue and
deliver the Securities;
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
That in order to declare the terms and conditions upon which the
Securities are authenticated, issued, delivered and held, and in consideration
of the premises, of the purchase and acceptance of the Securities by the holders
thereof and of the sum of one dollar to it duly paid by the Trustee at the
execution of these presents, the receipt whereof is hereby acknowledged, the
Company covenants and agrees with the Trustee, for the benefit of the respective
holders from time to time of the Securities, as follows:
ARTICLE ONE
DEFINITIONS
SECTION 1.01. Certain Terms Defined. The terms defined in this Section
1.01 (except as otherwise expressly provided or unless the context otherwise
requires), for all purposes of this Indenture and of any indenture supplemental
hereto, shall have the respective meanings specified in this Section 1.01. All
other terms used in this Indenture that are defined in the Trust Indenture Act
of 1939, or that are by reference therein defined in the Securities Act of 1933,
as amended (except as herein otherwise expressly provided or unless the context
otherwise requires), shall have the meanings assigned to such terms in the Trust
Indenture Act of 1939 and in said
Securities Act as they were in force at the date of the execution of this
Indenture, unless said Trust Indenture Act of 1939 or said Securities Act
expressly provide for application of such statutes as of another date.
Affiliate: The term "Affiliate" shall mean any person directly or
indirectly controlling, controlled by, or under direct or indirect common
control with, the Company.
Bankruptcy Code: The term "Bankruptcy Code" shall mean Title 11, U.S.
Code, or any similar federal or state law for the relief of debtors.
Board of Directors: The term "Board of Directors," when used with
reference to the Company, shall mean the Board of Directors of the Company or
the Executive Committee of the Board of Directors of the Company.
Business Day: The term "Business Day" shall mean, with respect to any
Security, a day other than a Saturday, a Sunday or a day that shall be in the
city (or in any of the cities, if more than one), in which amounts are payable,
as specified on the face of the form of such Security, a day on which banking
institutions are authorized or obligated by law to close.
Commission: The term "Commission" shall mean 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 and
delivery of this Indenture such Commission is not existing and performing the
duties now assigned to it under the Trust Indenture Act of 1939, then the body
performing such duties on said date.
Company: The term "Company" shall mean Southwest Airlines Co., a Texas
corporation, and, subject to the provisions of Article Ten, shall also include
its successors and assigns.
Depositary: The term "Depositary" shall mean, with respect to the
Securities of any series issuable or issued in whole or in part in the form of
one or more Global Securities, the person designated as Depositary for such
series by the Company pursuant to Section 2.03 or otherwise appointed by the
Company as a successor to such person in the event such person is unwilling or
unable to continue to serve in such capacity.
Event of Default: The term "Event of Default" shall mean any event
specified in Section 5.01, continued for the period of time, if any, and after
the giving of notice, if any, therein designated.
Global Security: The term "Global Security" shall mean a Security
issued in accordance with Section 2.10 evidencing all or part of a series of
Securities, which in each case is issued to the Depositary for such series, or
part of a series, or its nominee and registered in the name of such Depositary
or nominee.
2
Indenture: The term "Indenture" shall mean this instrument as
originally executed, or, if amended or supplemented as herein provided, as so
amended or supplemented or both, and shall include the forms and terms of
particular series of Securities established as contemplated hereunder.
Interest: The term "interest," when used with respect to a non-interest
bearing Security, shall mean interest payable after the principal thereof has
become due and payable, whether after maturity, by declaration of acceleration,
by call for redemption pursuant to a sinking fund, or otherwise.
Officers' Certificate: The term "Officers' Certificate" shall mean a
certificate signed by the Chairman of the Board or the President or any Vice
Chairman of the Board or any Vice President and by the Treasurer or an Assistant
Treasurer or the Secretary or an Assistant Secretary of the Company. Each such
certificate shall include the statements provided for in Section 13.05, if and
to the extent required by the provisions thereof.
Opinion of Counsel: The term "Opinion of Counsel" shall mean an opinion
in writing signed by legal counsel, who may be an employee of, or of counsel to,
the Company or may be other counsel. Each such opinion shall include the
statements provided for in Section 13.05, if and to the extent required by the
provisions thereof.
Original Issue Discount Security: The term "Original Issue Discount
Security" shall mean any Security that provides for an amount less than the
principal amount thereof to be due and payable upon a declaration of
acceleration of the maturity thereof pursuant to Section 5.01.
Outstanding: The term "outstanding," when used with reference to
Securities, shall, subject to the provisions of Section 7.04, mean, as of any
particular time, all Securities authenticated and delivered by the Trustee under
this Indenture except:
(a) Securities theretofore canceled by the Trustee or
delivered to the Trustee for cancellation;
(b) Securities, or portions thereof, for the payment or
redemption of which moneys in the necessary amount shall have been
deposited in trust with the Trustee or with any Paying Agent (other
than the Company) or shall have been set aside and segregated in trust
by the Company for the holders of such Securities (if the Company shall
act as its own Paying Agent), provided that if such Securities are to
be redeemed prior to the maturity hereof, notice of such redemption
shall have been given as herein provided, or provision satisfactory to
the Trustee shall have been made for giving such notice, and, if all
such Securities are redeemed, such deposit shall be in accordance with
Article Eleven; and
(c) Securities in lieu of or in substitution for which other
Securities shall have been authenticated and delivered, or which shall
have been paid, pursuant to the terms of Section 2.08, unless proof
satisfactory to the Trustee is presented that any such Securities
3
are held by a person in whose hands such Security is a legal, valid and
binding obligation of the Company.
In determining whether the holders of the requisite principal amount of
outstanding Securities of any or all series have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, the principal
amount of an Original Issue Discount Security that shall be deemed to be
outstanding for such purposes shall be the amount of the principal thereof that
would be due and payable as of the date of such determination upon a declaration
of acceleration of the maturity thereof pursuant to Section 5.01.
Paying Agent: Any person authorized by the Company to pay the principal
of, premium, if any, or interest on any securities on behalf of the Company.
Responsible Officer: The term "Responsible Officer," when used with
respect to the Trustee, shall mean any officer within the corporate trust and
agency group or department of the Trustee, including any Vice President, any
trust officer or any other officer of the Trustee performing functions similar
to those performed by any of the above-designated officers and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of his knowledge of and familiarity with the
particular subject.
Security or Securities: The term "Security" or "Securities" shall mean
any Security or Securities, as the case may be, authenticated and delivered
under this Indenture.
Securityholder: The term "Securityholder," "holder of Securities," or
other similar term, shall mean any person who shall at the time be the
registered holder of any Security or Securities on the books of the Company kept
for that purpose in accordance with the provisions of this Indenture and shall
also mean the executors, administrators and other legal representatives of such
person.
Subsidiary: The term "Subsidiary" shall mean any corporation or other
entity at least a majority of the outstanding voting shares of which is at the
time directly or indirectly owned or controlled (either alone or through
Subsidiaries or together with Subsidiaries) by the Company or another
Subsidiary.
Trustee; principal office: The term "Trustee" shall mean ▇▇▇▇▇ Fargo
Bank, N.A., and, subject to the provisions of Article Six, shall also include
its successors. The term "principal office" of the Trustee shall mean the
principal office of the Trustee at which at any particular time its corporate
trust business may be administered, which office at the date of execution of
this Indenture is ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇.
Trust Indenture Act of 1939: The term "Trust Indenture Act of 1939"
shall mean the Trust Indenture Act of 1939, as amended, as in effect on the date
of this Indenture, except as provided in Section 9.01 or 9.02 and except to the
extent that any subsequent amendment to the Trust Indenture Act of 1939 shall
retroactively apply to this instrument.
4
Yield to Maturity: The term "Yield to Maturity" shall mean the yield to
maturity on a series of Securities, calculated at the time of the issuance of
such series, or, if applicable, at the most recent redetermination of interest
on such series, and calculated in accordance with accepted financial practice.
SECTION 1.02. References are to Indenture. Unless the context otherwise
requires, all references herein to "Articles," "Sections" and other subdivisions
refer to the corresponding Articles, Sections and other subdivisions of this
Indenture, and the words "herein," "hereof," "hereby," "hereunder" and words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision hereof.
SECTION 1.03. Conflict with Trust Indenture Act of 1939. If any
provision hereof limits, qualifies or conflicts with a provision of the Trust
Indenture Act of 1939 that is required under such Act to be part of and govern
this Indenture, the latter provision shall control. If any provision of this
Indenture modifies or excludes any provision of the Trust Indenture Act of 1939
that may be so modified or excluded, the latter provision shall be deemed to
apply to this Indenture as so modified or to be excluded, as the case may be.
ARTICLE TWO
ISSUE, DESCRIPTION, EXECUTION, REGISTRATION
AND EXCHANGE OF SECURITIES
SECTION 2.01. Forms Generally. The Securities of each series shall be
substantially in the form (not inconsistent with this Indenture) as shall be
established by the Board of Directors or in one or more indentures supplemental
hereto, in each case with such appropriate insertions, omissions, substitutions
and other variations as are required or permitted by this Indenture, and in case
such form is not established by supplemental indenture, such form shall be
approved by the Trustee if the Trustee's rights or obligations are adversely
affected thereby and may have imprinted or otherwise reproduced thereon such
legend or legends, not inconsistent with the provisions of this Indenture, as
may be required to comply with any law or with any rules or regulations pursuant
thereto, or with any rules of any securities exchange or to conform to general
usage, consistently herewith, all as my be determined by the officer executing
such Securities, as evidenced by his execution of the Securities.
The definitive Securities shall be printed, lithographed or engraved on
steel engraved borders or, with the consent of the Trustee, may be produced in
any other manner, all as determined by the officer executing such Securities, as
evidenced by his execution of such Securities.
SECTION 2.02. Form of Trustee's Certificate of Authentication. The
Trustee's certificate of authentication of all Securities shall be in
substantially the following form:
This is one of the Securities of the series designated herein referred
to in the within-mentioned Indenture.
5
▇▇▇▇▇ FARGO BANK, N.A.,
as Trustee
By: __________________________
Authorized Signatory
SECTION 2.03. Amount Unlimited; Issuable in Series. The aggregate
principal amount of Securities that may be authenticated and delivered under
this Indenture is unlimited.
The Securities may be issued in one or more series. There shall be
established by the Board of Directors and set forth in an Officers' Certificate
or established in one or more indentures supplemental hereto, prior to the
issuance of Securities of any series, the following terms, which terms shall be
approved by the Trustee if the Trustee's rights or obligations are adversely
affected thereby, and thereafter such terms shall be deemed to be a part of this
Indenture:
(1) the title of the Securities of the series (which shall
distinguish the Securities of the series from all other Securities);
(2) any limit upon the aggregate principal amount of the
Securities or the series that may be authenticated and delivered under
this Indenture (except for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other
Securities of the series pursuant to Sections 2.06, 2.07, 2.08, 5.03,
9.04 and Article Fourteen);
(3) the date or dates on which the principal of the Securities
of the series is payable;
(4) the rate or rates, or method by which the rate or rates
are determined, at which the Securities of the series shall bear
interest, if any, the date or dates from which such interest shall
accrue, the interest payment dates on which such interest shall be
payable and the record dates for the determination of Securityholders
to whom interest is payable;
(5) the offices or agencies of the Company in the United
States of America where the principal of and any interest on Securities
of the series shall be payable;
(6) the price or prices at which, the period or periods within
which and the terms and conditions upon which Securities of the series
may be redeemed, in whole or in part, at the option of the Company,
pursuant to any sinking fund or otherwise;
6
(7) the obligation, if any, of the Company to redeem, purchase
or repay Securities of the series pursuant to any sinking fund or
analogous provisions or at the option of a holder thereof and the price
or prices at which and the period or periods within which and the terms
and conditions upon which Securities of the series shall be redeemed,
purchased or repaid, in whole or in part, pursuant to such obligation;
(8) if other than denominations of $1,000 and any multiple
thereof, the denominations in which Securities of the series shall be
issuable;
(9) if other than the principal amount thereof, the portion of
the principal amount of Securities of the series that shall be payable
upon declaration of acceleration of the maturity thereof or provable in
bankruptcy;
(10) any trustees, authenticating or Paying Agents, warrant
agents, transfer agents or registrars with respect to the Securities of
such series;
(11) the applicability, if any, of Section 11.05 to such
series;
(12) whether the Securities of the series shall be issued in
whole or in part in the form of one or more Global Securities and, in
such case, the Depositary for such Global Security or Securities, which
Depositary shall be a clearing agency registered under the Securities
Exchange Act of 1934, as amended; and
(13) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture), including any
additional covenants with respect to such series.
All Securities of any one series shall be substantially identical
except as to denomination and except as may otherwise be provided by the Board
of Directors and set forth in such Officers' Certificate or as may be otherwise
provided in any such indenture supplemental hereto.
SECTION 2.04. Authentication and Delivery of Securities. At any time
and from time to time after the execution and delivery of this Indenture, the
Company may deliver Securities of any series executed by the Company to the
Trustee for authentication, and the Trustee shall thereupon authenticate and
deliver said Securities to or upon the written order of the Company, signed on
behalf of the Company by its Chairman of the Board or its President or a Vice
Chairman of the Board or a Vice President and attested to by its Secretary or an
Assistant Secretary or by its Treasurer or an Assistant Treasurer, without any
further action by the Company. In authenticating such Securities and accepting
the additional responsibilities under
7
this Indenture in relation to such Securities, the Trustee shall be entitled to
receive, and (subject to Section 6.01) shall be fully protected in relying upon:
(1) certified copies of the Articles of Incorporation and
bylaws of the Company (or an Officers' Certificate with respect to any
amendment thereto) and of any resolutions of the Board of Directors
authorizing the action taken pursuant to the resolutions delivered
pursuant to clause (2) below;
(2) a copy of any resolutions of the Board of Directors
relating to such Securities, in each case certified by the Secretary or
an Assistant Secretary of the Company;
(3) an executed supplemental indenture, if any;
(4) an Officers' Certificate setting forth the form or forms
and terms of the Securities under Sections 2.01 and 2.03, respectively,
and stating that no Event of Default then exists and, in the case of a
series of Original Issue Discount Securities, the Yield to Maturity of
such series; and
(5) an Opinion of Counsel, which shall state
(a) that the form or forms and terms of such
Securities have been established by the Board of Directors or
by a supplemental indenture as permitted by, and in conformity
with, the provisions of this Indenture;
(b) that such Securities, when authenticated and
delivered by the Trustee and issued by the Company in the
manner and subject to any conditions specified in such Opinion
of Counsel, will constitute valid, binding and enforceable
obligations of the Company, subject to customary exceptions;
and
(c) such other matters as the Trustee may reasonably
request.
The Trustee shall have the right to decline to authenticate and deliver
any Securities under this Section if the Trustee, being advised by counsel,
determines that such action may not lawfully be taken by the Company or if the
Trustee in good faith shall determine that such action would expose the Trustee
to personal liability to existing Securityholders.
SECTION 2.05. Execution of Securities. The Securities shall be signed
on behalf of the Company, manually or in facsimile, by its Chairman of the Board
or its President or a Vice Chairman of the Board or a Vice President either
under its corporate seal (which may be in facsimile) reproduced thereon and
attested, manually or in facsimile, by its Secretary or an Assistant Secretary
or its Treasurer or an Assistant Treasurer, or not under its corporate seal, as
the Company may elect. Typographical and other minor errors or defects in any
such reproduction of the seal or any such signature shall not affect the
validity or enforceability of any Security that has been duly authorized and
delivered by the Trustee.
8
In case any officer of the Company whose signature appears on any of
the Securities, manually or in facsimile, shall cease to be such officer before
such Securities so signed shall have been authenticated and delivered by the
Trustee, or disposed of by the Company, such Securities nevertheless may be
authenticated and delivered by the Trustee, or disposed of by the Company, as
though the person whose signature appears on such Securities had not ceased to
be such officer of the Company; and any Security may be signed and the corporate
seal reproduced thereon may be attested, on behalf of the Company, manually or
in facsimile, by such persons as, at the actual date of the execution of such
Security, shall be the proper officers of the Company, although at the date of
the execution of this Indenture any such person was not such officer.
Only such Securities as shall bear thereon a certificate of
authentication substantially in the form hereinbefore receipted, signed manually
by an authorized signatory of the Trustee, shall be entitled to the benefits of
this Indenture or be valid or obligatory for any purpose. Such certificate by
the Trustee upon any Security executed by the Company shall be conclusive
evidence that the Security so authenticated has been duly authenticated and
delivered hereunder and that the holder is entitled to the benefits of this
Indenture.
SECTION 2.06. Exchange of Securities. Securities of any series may be
exchanged for a like aggregate principal amount of Securities of the same series
in other authorized denominations. The Securities of any series to be exchanged
shall be surrendered at the offices or agencies to be maintained by the Company
in accordance with the provisions of Section 3.02, and the Company shall execute
and the Trustee shall authenticate and deliver in exchange therefor the Security
or Securities that the Securityholder making the exchange shall be entitled to
receive.
The Company shall keep, at one of the offices or agencies to be
maintained by the Company in accordance with the provisions of Section 3.02, a
register or registers in which, subject to such reasonable regulations as it or
the Securities registrar may prescribe, the Company shall register Securities
and shall register the transfer of Securities as in this Article Two provided.
Upon surrender for registration of transfer of any Security at such office or
agency, the Company shall execute and the Trustee shall authenticate and deliver
in the name of the transferee or transferees a new Security or Securities of the
same series that the Securityholder making the exchange shall be entitled to
receive, for a like aggregate principal amount.
All Securities presented or surrendered for exchange, registration of
transfer, redemption or payment shall, if so required by the Company or the
Trustee, be duly endorsed by, or accompanied by a written instrument or
instruments of transfer in form satisfactory to the Company and the Trustee,
duly executed by the Securityholder or by his attorney who shall be so duly
authorized in writing.
No service charge shall be made for any exchange or registration of
transfer of Securities, but the Company or the Securities registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto.
9
The Company shall not be required to exchange or register a transfer of
(i) any Securities of any series for a period of 15 days next preceding the
first mailing of notice of redemption of Securities of such series to be
redeemed, or (ii) any Securities selected, called or being called for redemption
except, in the case of any Security where public notice has been given that such
Security is to be redeemed in part, the portion thereof not so to be redeemed.
Notwithstanding the foregoing, any Global Security shall be
exchangeable pursuant to this Section 2.06 for Securities registered in the
names of persons other than the Depositary for such Security or its nominee only
if (i) such Depositary notifies the Company that it is unwilling or unable to
continue as Depositary for such Global Security or if at any time such
Depositary ceases to be a clearing agency registered under the Securities
Exchange Act of 1934, as amended, and the Company fails to appoint a successor
Depositary for such Global Security within 90 days after the Company receives
such notice or becomes aware of such event, (ii) the Company executes and
delivers to the Trustee written instructions that such Global Security shall be
so exchangeable, or (iii) there shall have occurred and be continuing an Event
of Default or an event which, with the giving of notice or lapse of time, or
both, would constitute an Event of Default with respect to the Securities. Any
Global Security that is exchangeable pursuant to the preceding sentence shall be
exchangeable for Securities registered in such names as the Depositary shall
direct.
Except as provided in the immediately preceding paragraph, a Global
Security may not be transferred except as a whole by the Depositary with respect
to such Global Security to a nominee of such Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such Depositary or by such
Depositary or any such nominee to a successor of such Depositary or a nominee of
such successor.
None of the Company, the Trustee, any Paying Agent or the Security
Registrar will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests of a Global Security or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interests.
SECTION 2.07. Temporary Securities. Pending the preparation of
definitive Securities of any series, the Company may execute and the Trustee
authenticate and deliver temporary Securities of such series (printed,
typewritten or otherwise reproduced) of any authorized denomination and
substantially in the form of the definitive Securities of such series, but with
such omission, insertions and variations as may be appropriate for temporary
Securities of such series, all as may be determined by the Company. Temporary
Securities of any series may contain reference to any provisions of this
Indenture as may be appropriate. Every such temporary Security shall be
authenticated by the Trustee upon the conditions and in substantially the same
manner, and with the same effect, as the definitive Securities of such series.
Without unnecessary delay, the Company will execute and deliver to the Trustee
definitive Securities of such series and thereupon any or all temporary
Securities of such series may be surrendered in exchange therefor, at the
offices or agencies to be maintained by the Company in accordance with the
provisions of Section 3.02, and the Trustee shall authenticate and deliver in
exchange for such temporary Securities of such series an equal aggregate
principal amount of definitive Securities of such series. Until so exchanged,
the temporary Securities of such series shall in all
10
respects be entitled to the same benefits under this Indenture as definitive
Securities of such series authenticated and delivered hereunder.
SECTION 2.08. Mutilated, Destroyed, Lost or Stolen Securities. In case
any temporary or definitive Security of any series shall become mutilated or be
destroyed, lost or stolen, the Company, in the case of any mutilated Security of
any series shall, and in the case of any destroyed, lost or stolen Security of
any series in its discretion may, execute and upon its request the Trustee shall
authenticate and deliver, a new Security of the same series bearing a number not
contemporaneously outstanding in exchange and substitution for the mutilated
Security, or in lieu of and substitution for the Security so destroyed, lost or
stolen, or, if any such Security shall have matured or shall be about to mature,
instead of issuing a substituted Security, the Company may pay the same without
surrender thereof except in the case of a mutilated Security.
In every case the applicant for a substituted Security or for such
payment shall furnish to the Company and to the Trustee such security or
indemnity as may be required by them to save each of them harmless from all
risk, however remote, and, in every case of destruction, loss or theft, the
applicant shall also furnish to the Company and to the Trustee evidence to their
satisfaction of the destruction, loss or theft of such Security and of the
ownership thereof. The Trustee may authenticate any such substituted Security
and deliver the same, or the Trustee or any Paying Agent of the Company may make
any such payment, upon the written request or authorization of any officer of
the Company, and shall incur no liability to anyone by reason of anything done
or omitted to be done by it in good faith under the provisions of this Section
2.08. Upon the issue of any substituted Security, 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 expenses connected therewith
(including the fees and expenses of the Trustee).
Every substituted Security issued pursuant to the provisions of this
Section 2.08 in substitution for any destroyed, lost or stolen Securities shall
constitute an additional contractual obligation of the Company, whether or not
the destroyed, lost or stolen Security shall be found at any time, and shall be
entitled to all the benefits of (but shall be subject to all the limitations of
rights set forth in) this Indenture equally and proportionately with any and all
other Securities duly issued hereunder.
All Securities shall be held and owned upon the express condition that
the foregoing provisions are exclusive with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities, and shall preclude
(to the extent lawful) any and all other rights or remedies, notwithstanding any
law or statute existing or hereafter enacted to the contrary with respect to the
replacement or payment of negotiable instruments or other securities without
their surrender.
SECTION 2.09. Cancellation of Surrendered Securities. All Securities
surrendered for the purpose of payment, redemption, exchange, substitution or
registration of transfer, shall, if surrendered to the Company or any Paying
Agent or registrar, be delivered to the Trustee and the same, together with
securities surrendered to the Trustee for cancellation, shall be promptly
canceled by it, and no Securities shall be issued in lieu thereof except as
expressly permitted by any of the provisions of this Indenture. The Trustee
shall destroy canceled Securities and shall deliver certificates of destruction
thereof to the Company from time to time. If the Company
11
shall purchase or otherwise acquire any of the Securities, however, such
purchase or acquisition shall not operate as a payment, redemption or
satisfaction of the indebtedness represented by such Securities unless and until
the Company, at its option, shall deliver or surrender the same to the Trustee
for cancellation.
SECTION 2.10. Securities in Global Form. If Securities of or within a
series are issuable in whole or in part in temporary or permanent global form,
as specified as contemplated by Section 2.03, then, notwithstanding clause (8)
of Section 2.03, any such Security shall represent such of the outstanding
Securities of such series as shall be specified therein and may provide that it
shall represent the aggregate amount of outstanding Securities from time to time
endorsed thereon and that the aggregate amount of outstanding Securities
represented thereby may from time to time be reduced to reflect exchanges. Any
endorsement of a Security in global form to reflect the amount, or any increase
or decrease in the amount, or changes in the rights of holders, of outstanding
Securities represented thereby, shall be made by the Trustee in such manner and
upon instructions given by such person or persons as shall be specified therein
or in the instructions by the Company to be delivered to the Trustee pursuant to
Section 2.04 or 2.07. Subject to the provisions of Section 2.04 and, if
applicable, Section 2.07, the Trustee shall deliver and redeliver any Security
in global form in the manner and upon instructions given by the person or
persons specified therein or in the applicable Company instructions. Any
instructions by the Company with respect to endorsement or delivery or
redelivery of a Security in global form shall be in writing but need not comply
with Section 13.05 hereof and need not be accompanied by an Opinion of Counsel.
ARTICLE THREE
PARTICULAR COVENANTS OF THE COMPANY
The Company covenants as follows:
SECTION 3.01. Payment of Principal of (and Premium, if any) and
Interest on Securities. The Company will duly and punctually pay or cause to be
paid the principal of (and premium, if any) and interest on each series of the
Securities at the respective times and places and in the manner provided in such
Securities and this Indenture. Each payment from the Company to the Trustee or
to the Paying Agent shall be accompanied by a written notice that designates the
series to which such payment relates. As a condition precedent to the payment of
any interest on a Security, the Company or the Paying Agent may require the
holder of such Security to furnish such evidence as will enable the Company to
determine whether it is required by law to deduct or to retain any tax or taxes
from the interest so payable. An installment of principal, premium or interest
shall be considered paid on the date it is due if the Trustee or Paying Agent
holds by 11:00 a.m., New York City time, on that date money designated for and
sufficient to pay the installment.
SECTION 3.02. Maintenance of Office or Agency for Registration of
Transfer, Exchange and Payment of Securities. So long as any of the Securities
shall remain outstanding, the Company will maintain an office or agency in the
continental United States, where the Securities may be surrendered for exchange
or registration of transfer as in this Indenture provided, and
12
where notices and demands to or upon the Company in respect of the Securities or
of this Indenture may be served, and where the Securities may be presented or
surrendered for payment. The Company will give to the Trustee prompt written
notice of the location of any such office or agency and of any change of
location thereof. In case the Company shall fail to maintain any such required
office or agency or shall fail to give such notice of the location or of any
change in the location thereof, such surrenders, presentations and demands may
be made and notices may be served at the principal office of the Trustee, and
the Company hereby appoints the Trustee its agent to receive at the aforesaid
office all such surrenders, presentations, notices and demands.
The Company may from time to time designate one or more other offices
or agencies where the Securities may be presented or surrendered for any or all
such purposes, and may from time to time rescind such designations; provided,
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 continental
United States, for such purposes as stated in this Section. The Company will
give prompt written notice to the Trustee of any such designation or rescission
and any change in the location of any such office or agency.
SECTION 3.03. Appointment to Fill a Vacancy in the Office of Trustee.
The Company, whenever necessary to avoid or fill a vacancy in the office of
Trustee, will appoint, in the manner provided in Section 6.10, a Trustee, so
that there shall at all times be a Trustee hereunder.
SECTION 3.04. Provision as to Paying Agent. (a) If the Company shall
appoint a Paying Agent other than the Trustee, it will cause such Paying Agent
to execute and deliver to the Trustee an instrument in which such agent shall
agree with the Trustee, subject to the provisions of this Section 3.04,
(1) that it will hold all sums held by it as such agent for
the payment of the principal of (and premium, if any) or interest on
any series of Securities (whether such sums have been paid to it by the
Company or by any other obligor on such series of Securities) 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,
and
(2) that it will give the Trustee written notice of any
failure by the Company (or by any other obligor on any series of
Securities) to make any payment of the principal of (and premium, if
any) or interest on such series of Securities when the same shall be
due and payable; and
(3) at any time during the continuance of an Event of Default,
upon the written request of the Trustee, forthwith pay to the Trustee
all sums so held in trust by such Paying Agent.
(b) The Company will, prior to each due date of the principal of (and
premium, if any) or interest on any series of Securities, deposit with the
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
holders of such series of Securities entitled to such principal, premium or
interest,
13
and (unless such Paying Agent is the Trustee) the Company will promptly notify
the Trustee in writing of its failure so to act.
(c) If the Company shall 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 series of Securities, set aside, segregate and hold in trust for the benefit
of the persons entitled thereto, a sum sufficient to pay such 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 in writing of any such action or failure to take such action.
(d) Anything in this Section 3.04 to the contrary notwithstanding, the
Company may, at any time, for the purpose of obtaining a satisfaction and
discharge with respect to one or more or all series of Securities hereunder, or
for any other reason, but only in accordance with Article Eleven, pay or cause
to be paid to the Trustee or any Paying Agent all sums held in trust for any
such series by it, or any Paying Agent hereunder, as required by this Section
3.04, such sums to be held by the Trustee or such Paying Agent upon the trusts
herein contained. 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.
(e) Anything in this Section 3.04 to the contrary notwithstanding, the
agreement to hold sums in trust as provided in this Section 3.04 is subject to
the provisions of Sections 11.03 and 11.04.
SECTION 3.05. Maintenance of Corporate Existence. Subject to Article
Ten, the Company will at all times do or cause to be done all things necessary
to preserve and keep in full force and effect its corporate existence and its
franchise to be a corporation.
SECTION 3.06. Officers' Certificate as to Default. The Company will, so
long as any series of Securities is outstanding, deliver to the Trustee,
forthwith upon becoming aware of any default or defaults in the performance of
any covenant, agreement or condition contained in this Indenture, an Officers'
Certificate specifying such default or defaults.
SECTION 3.07. Further Assurance. From time to time whenever reasonably
demanded by the Trustee, the Company will make, execute and deliver or cause to
be made, executed and delivered any and all such further and other instruments
and assurances as may be reasonably necessary or proper to carry out the
intention of or to facilitate the performance of the terms of this Indenture or
to secure the rights and remedies hereunder of the holders of any series of
Securities.
ARTICLE FOUR
SECURITYHOLDERS' LISTS AND REPORTS BY THE COMPANY
AND THE TRUSTEE
SECTION 4.01. Company to Furnish Trustee Information as to Names and
Addresses to Securityholders. The Company will furnish or cause to be furnished
to the Trustee a list in such
14
form as the Trustee may reasonably require containing all information in the
possession or control of the Company, or any of its Paying Agents other than the
Trustee, as to the names and addresses of the holders of the Securities of each
series obtained since the date as of which the next previous list if any, was
furnished:
(a) semi-annually, not more than 15 days after each record date
for the payment of semi-annual interest on such Securities, as hereinabove
specified, as of such record date and not less than once every six months
for non-interest bearing Securities in each year, 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, that such list need not include
information received after such date, provided, however, that so long as
the Trustee is the Security registrar, no such list shall be required to be
furnished.
SECTION 4.02. Preservation and Disclosure of Lists. (a) The Trustee
shall preserve, in as current a form as is reasonably practicable, all
information as to the names and addresses of the holders of Securities (1)
contained in the most recent list furnished to it as provided in Section 4.01
and (2) received by it in the capacity of Paying Agent (if so acting) and
Security registrar (if so acting).
The Trustee may destroy any list furnished to it as provided in Section
4.01 upon receipt of a new list so furnished.
(b) Securityholders may communicate pursuant to Section 312(b) of the
Trust Indenture Act of 1939 with other Securityholders with respect to their
rights under this Indenture or any or all series of the Securities.
(c) Each and every Securityholder, by receiving and holding the same,
agrees with the Company and the Trustee that neither the Company nor the Trustee
nor any Paying Agent nor the Security registrar shall be held accountable by
reason of the disclosure of any such information as to the names and addresses
of the holders of Securities in accordance with the provisions of subsection (b)
of this Section 4.02, 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 said subsection (b).
SECTION 4.03. Reports by the Company. (a) The Company covenants and
agrees to file with the Trustee, within 30 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) that 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, as
amended; or, if the Company is not required to file information, documents or
reports pursuant to either of such sections, then to file with the Trustee and
the Commission, in accordance with rules and regulations prescribed from time to
time by the Commission, such of the supplementary and periodic information,
documents and reports that may be required pursuant to Section 13 of the
15
Securities Exchange Act of 1934, as amended, 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.
(b) The Company covenants and agrees to file with the Trustee and the
Commission, in accordance with the 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 provided
for in this Indenture as may be required from time to time by such rules and
regulations.
(c) The Company covenants and agrees to transmit to the holders of
Securities within 30 days after the filing thereof with the Trustee, in the
manner and to the extent provided in subsection (c) of Section 4.04 with respect
to reports pursuant to subsection (a) of said Section 4.04, such summaries of
any information, documents and reports required to be filed by the Company
pursuant to subsections (a) and (b) of this Section 4.03 as may be required by
rules and regulations prescribed from time to time by the Commission.
(d) The Company covenants and agrees to furnish to the Trustee, not
less often than annually, a brief certificate from the principal executive
officer, principal financial officer or principal accounting officer of the
Company as to his or her knowledge of the Company's compliance with all
conditions and covenants under this Indenture; provided, for purposes of this
paragraph, such compliance shall be determined without regard to any period of
grace or requirement of notice provided under this Indenture.
SECTION 4.04. Reports by the Trustee. (a) On or before July 14, ______,
and on or before July 14th in every year thereafter, so long as any Securities
are outstanding hereunder, if such report is required by the Trust Indenture Act
of 1939, the Trustee shall transmit to the Securityholders of each series, as
hereinafter in this Section 4.04 provided, a brief report dated as of May 15th
of the year in which such report is made that complies with Section 313(a) of
the Trust Indenture Act of 1939.
(b) The Trustee shall also comply with Section 313(b)(2) of the Trust
Indenture Act of 1939.
(c) Reports pursuant to this Section 4.04 shall be transmitted by mail
to all Securityholders, as the names and addresses of such holders appear upon
the registry books of the Company and to all other person to whom such reports
are required to be transmitted pursuant to Section 313(c) of the Trust Indenture
Act of 1939.
(d) A copy of each such report shall, at the time of such transmission
to holders of Securities, be filed by the Trustee with each stock exchange upon
which the Securities of any applicable series are listed and also with the
Commission. The Company will notify the Trustee when and as the Securities of
such series become listed on any stock exchange.
16
ARTICLE FIVE
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 5.01 Events of Default Defined; Acceleration of Maturity;
Waiver of Default. In case one or more of the following Events of Default with
respect to Securities of any series shall have occurred and be continuing, that
is to say:
(a) default in the payment of any installment of interest upon
any of the Securities of such series as and when the same shall become
due and payable, and continuance of such default for a period of 30
days;
(b) default in the payment of the principal of (and premium,
if any, on) any of the Securities of such series as and when the same
shall become due and payable either at stated maturity, by declaration
or otherwise;
(c) failure on the part of the Company duly to observe or
perform in any material respect any other of the covenants or
agreements on the part of the Company in the Securities of such series
or contained in this Indenture for a period of 90 days after the date
on which written notice specifying such failure, stating that such
notice is a "Notice of Default" hereunder and, requiring the same to be
remedied, shall have been given to the Company by the Trustee, or to
the Company and the Trustee by the holders of at least 25% in aggregate
principal amount of the Securities of such series at the time
outstanding;
(d) default under the terms of any agreement or instrument
evidencing, or under which the Company has at the date of this
Indenture or hereafter outstanding, any indebtedness for borrowed money
and such indebtedness shall be accelerated so that the same shall be or
become due and payable prior to the date on which the same would
otherwise become due and payable and the aggregate principal amount
thereof so accelerated exceeds $50,000,000 and such acceleration is not
rescinded or annulled within ten days after there has been given, by
registered or certified mail, to the Company by the Trustee or to the
Company and the Trustee by the holders of at least 25% in aggregate
principal amount of the outstanding Securities of that series a written
notice specifying such default and stating that such notice is a
"Notice of Default" hereunder; (it being understood however, that,
subject to the provisions of Section 6.01, the Trustee shall not be
deemed to have knowledge of such default under such agreement or
instrument unless either (A) a Responsible Officer of the Trustee shall
have actual knowledge of such default or (B) a Responsible Officer of
the Trustee shall have received written notice thereof from the
Company, from any Securityholder, from the holder of any such
indebtedness or from the trustee under any such agreement or other
instrument); provided, however, that if such default under such
agreement or instrument is remedied or cured by the Company or waived
by the holders of such indebtedness, then the Event of Default
hereunder by reason thereof shall be deemed likewise to have been
thereupon
17
remedied, cured or waived without further action upon the part of
either the Trustee or any of such Securityholders;
(e) a court having jurisdiction in the premises shall enter a
decree or order for relief in respect of the Company in an involuntary
case under any applicable bankruptcy, insolvency or other similar law
now or hereafter in effect, or appointing a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar official) of the
Company or for any substantial part of its property, or ordering the
winding-up or liquidation of its affairs, and such decree or order
shall remain unstayed and in effect for a period of 60 consecutive
days; or
(f) the Company shall commence a voluntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter
in effect, or shall consent to the entry of an order for relief in an
involuntary case under any such law, or shall consent to the
appointment of, or taking possession by, a receiver, liquidator,
assignee, trustee, custodian, sequestrator (or similar official) of the
Company or for all or substantially all of its property, or shall make
any general assignment for the benefit of creditors, or shall fail
generally to pay its debts as they become due or shall take any
corporate action in furtherance of any of the foregoing,
then and in each and every such case, unless the principal of all the Securities
of such series shall have already become due and payable, either the Trustee or
the holders of not less than 25% in aggregate principal amount of the Securities
of such series then outstanding hereunder, by notice in writing to the Company
(and to the Trustee if given by Securityholders), may declare the principal of
all the Securities of such series (or, if the Securities of such series are
Original Issue Discount Securities, such portion of the principal amount as may
be specified in the terms of that series) of all Securities of such series and
the interest accrued thereon, if any, to be due and payable immediately, and
upon any such declaration the same shall become and shall be immediately due and
payable, anything in this Indenture or in the Securities contained to the
contrary notwithstanding. This provision, however, is subject to the condition
that if, at any time after the principal (or, if the Securities are Original
Issue Discount Securities, such portion of the principal as may be specified in
the terms thereof) of the Securities of any series (or of all the Securities, as
the case may be) shall have been so declared due and payable, and before any
judgment or decree for the payment of the moneys due shall have been obtained or
entered as hereinafter provided, the Company shall pay or shall deposit with the
Trustee a sum sufficient to pay all matured installments of interest upon all
the Securities of such series (or of all the Securities, as the case may be) and
the principal of (and premium, if any, on) all Securities of such series (or of
all the Securities, as the case may be) that shall have become due otherwise
than by declaration (with interest on overdue installments of interest to the
extent permitted by law, and on such principal and premium, if any, at the rate
of interest borne by the Securities or Yield to Maturity (in the case of
Original Issue Discount Securities) applicable to the Securities of such series
(or at the respective rates of interest or Yields to Maturity of all the
Securities, as the case may be) to the date of such payment or deposit) and the
expenses of the Trustee, and any and all defaults under this Indenture, other
than the nonpayment of principal of and accrued interest on Securities that
shall have become due by declaration, shall have been remedied, then and in
every such case the Securityholders of a majority in aggregate principal amount
of the
18
Securities of such series (or of all the Securities, as the case may be) then
outstanding, by written notice to the Company and to the Trustee, may waive all
defaults with respect to that series, each such series voting as a separate
class (or with respect to all Securities, as the case may be, in such case
treated as a single class) and rescind and annul such declaration and its
consequences; but no such waiver of rescission and annulment shall extend to or
shall affect any subsequent default, or shall impair any right consequent
thereon.
In case the Trustee shall have proceeded to enforce any right under
this Indenture and such proceedings shall have been discontinued or abandoned
because of such rescission or annulment or for any other reason or shall have
been determined adversely to the Trustee, then and in every such case the
Company, the Trustee and the holders of the Securities of such series shall be
restored respectively to their former positions and rights hereunder, and all
rights, remedies and powers of the Company and the Trustee shall continue as
though no such proceedings had been taken.
SECTION 5.02. Payment of Securities on Default; Suit Therefor. The
Company covenants that (1) in case default shall be made in the payment of any
installment of interest on any of the Securities of any series, as and when the
same shall become due and payable, and such default shall have continued for a
period of 30 days or (2) in case default shall be made in the payment of the
principal of (or premium, if any, on) any of the Securities of any series when
the same shall have become due and payable, whether upon maturity of the
Securities for such series or otherwise, including any sinking fund payment,
then, upon demand of the Trustee, the Company will pay to the Trustee for the
benefit of the holders of the Securities of such series (and shall designate
which series) the whole amount that then shall have become due and payable on
all Securities of such series for principal (and premium, if any) or interest,
or both, as the case may be, with interest on the overdue principal (and
premium, if any) and installments of interest (to the extent permitted by law)
at the rate of interest or Yield to Maturity (in the case of Original Issue
Discount Securities) borne by such series of Securities; and, in addition
thereto, such further amount as shall be sufficient to cover the costs and
expenses of collection, including a reasonable compensation to the Trustee, its
agents, attorneys and counsel, and any expenses or liabilities incurred by the
Trustee hereunder other than through its negligence or bad faith.
Until such demand is made by the Trustee, the Company may pay the
principal of (and premium, if any, on) and interest on the Securities of any
series to the holders thereof, whether or not the Securities of such series be
overdue.
In case the Company shall fail forthwith to pay such amounts upon such
demand, the Trustee, in its own name and as trustee of an express trust, shall
be entitled and empowered to institute any action or proceedings at law or in
equity for the collection of the sums so due and unpaid, and may prosecute any
such action or proceeding to judgment or final decree, and may enforce any such
judgment or final decree against the Company or any other obligor upon such
Securities, and collect in the manner provided by law out of the property of the
Company or any other obligor upon such Securities wherever situated the moneys
adjudged or decreed to be payable.
19
In case there shall be pending proceedings for the bankruptcy or for
the reorganization of the Company or any other obligor upon the Securities of
any series under the Bankruptcy Code or any other applicable law or in
connection with the insolvency of the Company or any other obligor upon any
Securities or in the case a receiver or trustee shall have been appointed for
its property, or in case of any other judicial proceedings relative to the
Company or any other obligor upon such series of Securities or to creditors or
property of the Company or such other obligor, the Trustee, irrespective of
whether the principal of such series of Securities shall then be due and payable
as therein expressed or by declaration or otherwise and irrespective of whether
the Trustee shall have made any demand pursuant to the provisions of this
Section 5.02, shall be entitled and empowered by intervention in such
proceedings or otherwise, to file and prove a claim or claims for the whole
amount of principal, premium, if any, and interest (or if the Securities of any
series are Original Issue Discount Securities, such portion of the principal
amount as may be specified in the terms of that series) owing and unpaid in
respect of the Securities of any series, and to file such other papers or
documents as may be necessary or advisable in order to have the claims of the
Trust and of the Securityholders allowed in any judicial proceedings relative to
the Company or any other obligor upon the Securities of any series, its
creditors, or its property, and to collect and receive any moneys or other
property payable or deliverable on any such claims, and to distribute the same
after the deduction of its charges and expenses; and any receiver, assignee or
trustee in bankruptcy or reorganization is hereby authorized by each of such
holders 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 compensation and expenses, including counsel
fees incurred by it up to the date of such distribution. To the extent that such
payment of reasonable compensation, expenses, liabilities and counsel fees out
of the estate in any such proceedings shall be denied for any reason (except as
a result of negligence or bad faith), payment of the same shall be secured by a
lien on, and shall be paid out of, any and all distributions, dividends, moneys,
securities and other property that the holders of the Securities of any series
may be entitled to receive in such proceedings, whether in liquidation or under
any plan of reorganization or arrangement or otherwise.
All rights of action and of asserting claims under this Indenture, or
under any of the Securities of any series, may be enforced by the Trustee
without the possession of any of the Securities, or the production thereof at
any trial or other proceeding relative thereto, and any such suit or proceeding
instituted by the Trustee shall be brought in its own name and as trustee of an
express trust, and any recovery of judgment shall be for the ratable benefit of
the holders of the Securities and the Trustee.
SECTION 5.03. Application of Moneys Collected by Trustee. Any moneys
collected by the Trustee pursuant to Section 5.02 with respect to any one or
more series shall be applied in the order following, at the date or dates fixed
by the Trustee for the distribution of such moneys, and, in the case of the
distribution of such moneys on account of principal or interest, upon
presentation of the several Securities of a series in respect of which moneys
have been collected, and stamping (or otherwise noting) thereon the payment, or
issuing Securities of such series in reduced principal amounts in exchange for
the presented Securities of such series if only partially paid, and upon
surrender thereof if fully paid:
20
FIRST: To the payment of costs and expenses of collection
applicable to such series, and reasonable compensation to the Trustee,
its agents, attorneys and counsel, and of all other expenses and
liabilities incurred, and all advances made, by the Trustee with
respect to such series, except as a result of its negligence or bad
faith;
SECOND: In case no principal of the outstanding Securities of
such series shall have become due and be unpaid, to the payment of
interest on the Securities of such series in default, in the order of
the maturity of the installments of such interest, with interest upon
the overdue installments of interest (so far as permitted by law and to
the extent that such interest has been collected by the Trustee) at the
rate of interest or Yield to Maturity (in the case of Original Issue
Discount Securities) borne by the Securities of such series; and in
case such moneys shall be insufficient to pay in full the whole amount
so due and unpaid upon the Securities of such series, then to the
payment of such principal (and premium, if any) and interest, without
preference or priority of principal (and premium, if any) over
interest, or of interest over principal (and premium, if any), or of
any installment of interest over any other installment of interest or
of any Security of such series over any other Security of such series,
ratably according to the aggregate of such principal (and premium, if
any) and accrued and unpaid interest; and
THIRD: To the payment of the remainder, if any, to the
Company, its successors or assigns, or to whosoever may be lawfully
entitled to receive the same or as a court of competent jurisdiction
may direct.
SECTION 5.04. Limitation on Suits by Holders of Securities. No holder
of a Security of any series shall have any right by virtue or by availing of any
provision of this Indenture to institute any suit, action or proceeding in
equity or at law or in bankruptcy or otherwise, upon or under or with respect to
this Indenture or for the appointment of a receiver, liquidating custodian,
trustee or similar official, or for any other remedy hereunder, unless such
holder previously shall have given to the Trustee written notice of default and
of the continuance thereof, as hereinabove provided, and unless also the holders
of not less than 25% in aggregate principal amount of such series of Securities
then outstanding shall have made written request upon the Trustee to institute
such action, suit or proceeding in its own name as Trustee hereunder and shall
have offered to the Trustee such reasonable indemnity as it may require against
the costs, expenses and liabilities to be incurred therein or thereby, and the
Trustee, for 60 days after its receipt of such notice, request and offer of
indemnity, shall have neglected or refused to institute any such action, suit or
proceeding and no direction inconsistent with such written request shall have
been given to the Trustee pursuant to Section 5.06; it being understood and
intended, and being expressly covenanted by the holder of every Security of a
series with every other Securityholder and the Trustee, that no one or more
holders of such series of Securities shall have any right in any manner
whatsoever by virtue or by availing of any provision of this Indenture to
affect, disturb or prejudice the rights of the holders of any other series of
Securities, or to obtain or seek to obtain priority over or preference to any
other such holder, or to enforce any right under this Indenture, except in the
manner herein provided and for the equal, ratable and common benefit of all
holders of Securities. For the protection and enforcement of the provisions of
this Section
21
5.04, each and every Securityholder and the Trustee shall be entitled to such
relief as can be given either at law or in equity.
Notwithstanding any other provisions in this Indenture, the right of
any holder of any Security to receive payment of the principal of (and premium,
if any) and interest on such Security, on or after the respective due dates
expressed in such Security, or to institute suit for the enforcement of any such
payment on or after such respective dates, shall not be impaired or affected
without the consent of such holder.
SECTION 5.05. Proceedings by Trustee; Remedies Cumulative and
Continuing. In case an Event of Default has occurred, has not been waived, and
is continuing, the Trustee may in its discretion proceed to protect and enforce
the rights vested in it by this Indenture by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect and enforce any
of such rights, either by suit in equity or by action at law or by proceeding in
bankruptcy or otherwise, whether for the specific enforcement of any covenant or
agreement contained in this Indenture or in aid of the exercise of any power
granted in this Indenture, or to enforce any other legal or equitable right
vested in the Trustee by this Indenture or by law. All powers and remedies given
by this Article Five to the Trustee or to the Securityholders shall, to the
extent permitted by law, be deemed cumulative and not exclusive of any thereof
or any other powers and remedies available to the Trustee or to the holders of
the Securities, by judicial proceedings or otherwise, to enforce the performance
or observance of the covenants and agreements contained in this Indenture, and
no delay or omission of the Trustee or of any holder of any of the Securities to
exercise any right or power accruing upon any default occurring and continuing
as aforesaid shall impair any such right or power, or shall be construed to be a
waiver of any such default or any acquiescence therein; and, subject to the
provisions of Section 5.04, every power and remedy given by this Article Five or
by law to the Trustee or to the Securityholders may be exercised from time to
time, and as often as shall be deemed expedient, by the Trustee or by the
Securityholders.
SECTION 5.06. Rights of Holders of Majority in Principal Amount of
Securities to Direct Trustee and to Waive Defaults. The holders of a majority in
aggregate principal amount of the Securities of all series affected (voting as
one class) at the time outstanding (determined as provided in Section 7.04), or,
if a record date is set in accordance with Section 7.05, as of such record date,
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 by this Indenture with respect to the Securities
of such series; provided, however, that subject to the provisions of Section
6.01, the Trustee shall have the right to decline to follow any such direction
if the Trustee being advised by counsel shall determine that the action so
directed may not lawfully be taken, or if the Trustee in good faith shall, by a
Responsible Officer or Officers of the Trustee, determine that the proceedings
so directed would be illegal or involve it in personal liability or be unjustly
prejudicial to the Securityholders not consenting, and provided further that
nothing in this Indenture shall impair the right of the Trustee in its
discretion to take any action deemed proper by the Trustee and which is not
inconsistent with such direction by the Securityholders. Prior to the
declaration of the maturity of the Securities of any series as provided in
Section 5.01, the holders of a majority in aggregate principal amount of the
Securities of such series at the time outstanding (each such series voting as a
separate class)
22
(determined as provided in Sections 7.04 and 7.05) may on behalf of the holders
of all of the Securities of such series waive any past default hereunder and its
consequences, except a default in the payment of interest or premium on, or the
principal of, any of the Securities. In the case of any such waiver the Company,
the Trustee and the holders of the Securities of such series shall be restored
to their former positions and rights hereunder, respectively; but no such waiver
shall extend to any subsequent or other default or impair any right consequent
hereon.
SECTION 5.07. Trustee to Give Notice of Defaults Known to It, But May
Withhold in Certain Circumstances. The Trustee shall, within 90 days after the
occurrence of a default hereunder, give to the Securityholders, in the manner
and to the extent provided in subsection (c) of Section 4.04 with respect to
reports pursuant to subsection (a) of Section 4.04, notice of such defaults
known to the Trustee unless such default shall have been cured or waived before
the giving of such notice (the term "defaults" for the purposes of this Section
5.07 being hereby defined to be the events specified in clauses (a), (b), (c),
(d), (e) and (f) of Section 5.01, not including any periods of grace provided
for therein, and irrespective of the giving of any required notice); provided
that, except in the case of default in the payment of the principal of (and
premium, if any) or interest on any of the Securities of such series, 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
and/or Responsible Officers of the Trustee in good faith determined that the
withholding of such notice is in the interest of the Securityholders of such
series.
SECTION 5.08. Requirement of an Undertaking to Pay Costs in Certain
Suits Under this Indenture or Against the Trustee. All parties to this Indenture
agree, and each holder of any Security by his acceptance thereof shall be deemed
to have agreed, that any court may in its discretion require, in any suit for
the enforcement or any right or remedy under this Indenture, or in any suit
against the Trustee for any action taken or omitted by it as Trustee, the filing
by any party litigant in such suit of an undertaking to pay the costs of such
suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorney's 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 5.08 shall not apply to
any suit instituted by the Trustee, to any suit instituted by any
Securityholder, or group of Securityholders of any series, holding in the
aggregate more than ten percent in aggregate principal amount of the Securities
of such series outstanding, or to any suit instituted by any Securityholder for
the enforcement of the payment of the principal of (and premium, if any) or
interest on any Security, on or after the due date expressed in such Security.
ARTICLE SIX
CONCERNING THE TRUSTEE
SECTION 6.01. Duties and Responsibilities of Trustee. The Trustee,
prior to the occurrence of an Event of Default and after the curing or waiving
of all Events of Default that may have occurred with respect to the Securities
of a series, undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture. In case an Event of Default has
occurred of which a Responsible Officer of the Trustee has actual knowledge
(which has not been cured or waived) the Trustee shall exercise such of the
rights and powers vested in it by this
23
Indenture with respect to the Securities of a series, and use the same degree of
care and skill in their exercise as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs.
No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, provided, however, that:
(a) prior to the occurrence of an Event of Default with
respect to the Securities of any series and after the curing or waiving
of all Events of default with respect to such series that may have
occurred
(1) the duties and obligations of the Trustee shall
be determined solely by the express provisions of this
Indenture, and the Trustee shall only be liable for the
performance of such duties and obligations as are specifically
set forth in this Indenture, and no implied covenants or
obligations shall be read into this Indenture against the
Trustee; and
(2) in the absence of bad faith on the part of the
Trustee, the Trustee may conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed
therein, upon any 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 that by
any provision hereof are specifically required to be furnished
to the Trustee, the Trustee shall be under a duty to examine
the same to determine whether or not they conform to the
requirements of this Indenture;
(b) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer or Officers of the Trustee,
unless it shall be proved that the Trustee was negligent in
ascertaining the pertinent facts; and
(c) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the
direction of the holders of not less than a majority in principal
amount of the Securities of all series affected (voting as a class) at
the time outstanding (determined as provided in Sections 7.04 and 7.05)
relating to the time, method and place of conducting any proceeding for
any remedy available to the Trustee, or exercising any trust or power
conferred upon the Trustee, under this Indenture.
None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties hereunder or in the exercise
of any of its rights or powers, if there is reasonable grounds for believing
that the repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.
24
SECTION 6.02. Reliance on Documents, Opinions, etc. Subject to the
provisions of Section 6.01:
(a) The Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval,
bond, 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, direction, order or demand of the Company
mentioned herein shall be sufficiently evidenced by an Officers'
Certificate (unless other evidence in respect thereof be herein
specifically prescribed); and the Trustee by a copy thereof certified
by the Secretary or any Assistant Secretary of the Company;
(c) The Trustee may consult with counsel and the advice of
such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in accordance with such
advice or Opinion of Counsel;
(d) The Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request,
order or direction of any of the Securityholders, pursuant to the
provisions of this Indenture, unless such Securityholders shall have
offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities that may be incurred therein or
thereby; but nothing herein contained shall, however, relieve the
Trustee of the obligation, upon the occurrence of an Event of Default
(which has not been cured or waived), to exercise such of the rights
and powers vested in it by this Indenture, and to 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;
(e) The Trustee shall not be liable for any action taken or
omitted by it in good faith and believed by it to be authorized or
within the discretion or rights or powers conferred upon it by this
Indenture;
(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, consent, order
approval, bond, note or other paper or document, unless requested in
writing so to do by the holders of not less than a majority in
aggregate principal amount of the Securities of all series affected
then outstanding voting as one class (determined as provided in
Sections 7.04 and 7.05); provided, however, that if the payment within
a reasonable time to the Trustee of the costs, expenses or liabilities
likely to be incurred by it in the making of such investigation is, in
the opinion of the Trustee, not reasonably assured to the Trustee by
the security afforded to it by the terms of this Indenture, the Trustee
may require reasonable indemnity against such expense or liability as a
condition to so proceeding. The reasonable expense of every such
examination shall be paid by the Company or, if paid by the Trustee,
shall be repaid by the Company upon demand; and
25
(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. The Trustee shall not be responsible for
any misconduct or negligence on the part of any agent or attorney
appointed with due care by it hereunder.
SECTION 6.03. No Responsibility for Recitals, etc. The statements and
recitals contained herein and in the Securities and in any other document in
connection with the sale of the Securities (other than the certificate of
authentication of the Securities) shall be taken as the statements of the
Company, and the Trustee assumes no responsibility for the correctness of the
same. The Trustee makes no representation as to the validity or sufficiency of
this Indenture or of the Securities. The Trustee shall not be accountable for
the use or application by the Company of any of the Securities or of the
proceeds of such Securities, or for the use or application of any moneys paid
over by the Trustee in accordance with any provision of this Indenture, or for
the use or application of any moneys received by any Paying Agent other than the
Trustee.
SECTION 6.04. Trustee, Paying Agent or Security Registrar May Own
Securities. The Trustee or any Paying Agent or Security registrar, in its
individual or any other capacity, may become the owner or pledgee of Securities
and may otherwise deal with the Company or any Affiliate of the Company with the
same rights it would have if it were not Trustee, Paying Agent or Security
registrar.
SECTION 6.05. Moneys Received by Trustee to be Held in Trust Without
Interest. Subject to the provisions of Section 11.04, all moneys received by the
Trustee shall, until used or applied as herein provided, be held in trust for
the purposes for which they were received, but need not be segregated from other
funds except to the extent required by law. The Trustee shall be under no
liability for interest on moneys received by it hereunder except such as it may
agree with the Company to pay thereon. So long as no Event of Default shall have
occurred and be continuing, all interest allowed on any such moneys shall be
paid from time to time upon the written order of the Company, signed by its
Chairman of the Board, any Vice Chairman of the Board, its President or any Vice
President or its Treasurer or any Assistant Treasurer.
SECTION 6.06. Compensation and Expenses of Trustee. The Company
covenants and agrees to pay to the Trustee from time to time, and the Trustee
shall be entitled to, reasonable compensation (which shall not be limited by any
provision of law in regard to the compensation of a Trustee of an express
trust), and the Company will promptly pay or reimburse the Trustee upon its
request for all reasonable expenses, disbursements and advances incurred or made
by the Trustee in connection with the acceptance or administration of its trust
under this Indenture (including the reasonable compensation and the expenses and
disbursements of its counsel and of all persons not regularly in its employ)
except any such expense, disbursement or advance as may arise from its
negligence or bad faith. The Company also covenants to indemnify the Trustee
for, and to hold it harmless against, any loss, liability or expense incurred
without negligence or bad faith on the part of the Trustee and arising (a) out
of or in connection with the acceptance or administration of this trust, or (b)
from any action or failure to act as authorized or within the discretion or
rights or powers conferred upon the Trustee hereunder, including the
26
costs and expenses of defending itself against any claim of liability in the
premises. The obligations of the Company under this Section 6.06 to compensate
the Trustee and to pay or reimburse the Trustee for expenses, disbursements,
losses, liabilities and advances shall constitute additional indebtedness
hereunder and shall survive the resignation or removal of the Trustee and the
satisfaction and discharge of this Indenture. Such additional indebtedness shall
be secured by a lien prior to that of the Securities upon all property and funds
held or collected by the Trustee as such, except funds held in trust for the
benefit of the holders of particular Securities.
SECTION 6.07. Right of Trustee to Rely on Officers' Certificate Where
No Other Evidence Specifically Prescribed. Subject to the provisions of Section
6.01, whenever in the administration of the provisions of this Indenture the
Trustee shall deem it necessary or desirable that a matter be proved or
established prior to taking, suffering or omitting any action hereunder, such
matter (unless other evidence in respect thereof be herein specifically
prescribed) may, in the absence of negligence or bad faith on the part of the
Trustee, be deemed to be conclusively proved and established by an Officers'
Certificate delivered to the Trustee, and such Certificate, in the absence of
negligence or bad faith on the part of the Trustee, shall be full warrant to the
Trustee for any action taken, suffered or omitted by it under the provisions of
this Indenture upon the faith thereof.
SECTION 6.08. Conflicting Interest of Trustee. (a) If, after an Event
of Default has occurred and is continuing, the Trustee has or shall acquire any
conflicting interest, as defined in this Section 6.08, it shall, within 90 days
after ascertaining that it has such conflicting interest, either eliminate such
conflicting interest or, unless the Trustee's duty to resign is stayed as
provided in Section 310(b) of the Trust Indenture Act of 1939, resign in the
manner and with the effect specified in Section 6.10, such resignation to become
effective upon the appointment of a successor trustee and such successor's
acceptance of such appointment, and the Company shall take prompt steps to have
a successor appointed in the manner provided in Section 6.10.
(b) In the event that the Trustee shall fail to comply with the
provisions of subsection (a) of this Section 6.08, the Trustee shall, within 10
days after the expiration of such 90-day period, or, if the Trustee's duty to
resign is stayed, after the end of such stay, transmit notice of such failure to
the Securityholders in the manner and to the extent provided in subsection (c)
of Section 4.04 with respect to reports pursuant to subsection (a) of Section
4.04.
(c) For the purposes of this Section 6.08, the Trustee shall be deemed
to have a conflicting interest if the Trustee has a conflict within the
provisions of Section 310(b) of the Trust Indenture Act of 1939.
SECTION 6.09. Requirements for Eligibility of Trustee. The Trustee
hereunder shall at all times be a corporation organized and doing business under
the laws of the United States or any State or territory thereof or of the
District of Columbia authorized under such laws to exercise corporate trust
powers, having a combined capital and surplus of at least five million dollars,
subject to supervision or examination by Federal, State, Territorial, or
District of Columbia authority. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then
27
for the purposes of this Section 6.09, 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. In case at any time the
Trustee shall cease to be eligible in accordance with the provisions of this
Section 6.09, the Trustee shall resign immediately in the manner and with the
effect specified in Section 6.10. Neither the Company nor any persons directly
or indirectly controlling, controlled by, or under common control with the
Company shall serve as Trustee.
SECTION 6.10. Resignation or Removal of Trustee. (a) The Trustee, or
any Trustee hereafter appointed, may at any time resign with respect to one or
more series of Securities by giving written notice of such resignation to the
Company or to the Securityholders, such notice to the Securityholders of
applicable series of Securities to be given by mailing (by first class mail) the
same. Upon receiving such notice of resignation, the Company shall promptly
appoint a successor trustee with respect to the applicable series by written
instrument, in duplicate, executed by order of the Board of Directors of the
Company, one copy of which instrument shall be delivered to the resigning
Trustee and one copy to the successor trustee. If no successor trustee shall
have been so appointed and have accepted appointment within 60 days after the
mailing of such notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor trustee, or
any Securityholder who has been a bona fide holder of a Security or Securities
for at least six months may, subject to the provisions of Section 5.08, on
behalf of himself and all others similarly situated, petition any such court for
the appointment of a successor trustee. Such court may thereupon, after such
notice, if any, as it may deem proper and prescribe, appoint a successor
trustee.
(b) In case at any time any of the following shall occur:
(1) the Trustee shall fail to comply with the provisions of
subsection (a) of Section 6.08 with respect to any series of Securities
after written request therefor by the Company or by any Securityholder
who has been a bona fide holder of a Security or Securities of such
series for at least six months, or
(2) the Trustee shall cease to be eligible in accordance with
the provisions of Section 6.09 and shall fail to resign after written
request therefor by the Company or by any such Securityholder, 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 a
substantial portion of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of a substantial
portion of its property or affairs for the purpose of rehabilitation,
conservation or liquidation,
then, in any such case, the Company may remove the Trustee with respect to the
applicable series and appoint a successor trustee for such series by written
instrument, in duplicate, executed by order of the Board of Directors of the
Company, one copy of which instrument shall be delivered to the Trustee so
removed and one copy to the successor trustee, or, subject to the provisions of
Section 5.08, any Securityholder who has been a bona fide holder of a Security
or
28
Securities of such series for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the removal of the Trustee and the appointment of a successor trustee with
respect to such series. Such court may thereupon, after such notice, if any, as
it may deem proper and prescribe, remove the Trustee and appoint a successor
trustee.
(c) The holders of a majority in aggregate principal amount of the
Securities of all series at the time outstanding voting as one class (determined
as provided in Section 7.04) may at any time remove the Trustee with respect to
Securities of all series and appoint a successor trustee with respect to
securities of all series by written instrument or instruments signed by such
holders or their attorneys-in-fact duly authorized, or by the affidavits of the
permanent chairman and secretary of a meeting of the Securityholders evidencing
the vote upon a resolution or resolutions submitted thereto with respect to such
removal and appointment (as provided in Article Eight), and by delivery thereof
to the Trustee so removed, to the successor trustee and to the Company.
(d) Any resignation or removal of the Trustee and appointment of any
successor trustee pursuant to any of the provisions of this Section 6.10 shall
become effective upon acceptance of appointment by the successor trustee as
provided in Section 6.11.
SECTION 6.11. Acceptance by Successor to Trustee; Notice of Succession
of a Trustee. Any successor trustee appointed as provided in Section 6.10 shall
execute, acknowledge and deliver to the Company and to its predecessor trustee
an instrument accepting such appointment hereunder, and thereupon the
resignation or removal of the predecessor trustee with respect to all or any
particular series shall become effective and such successor trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, duties and obligations with respect to such series of its predecessor
hereunder, with like effect as if originally named as Trustee herein; but,
nevertheless, on the written request of the Company or of the successor trustee,
the Trustee ceasing to act shall, upon payment of any amounts then due it
pursuant to the provisions of Section 6.06, pay over to the successor trustee,
subject to Section 11.04, all monies at the time held by it hereunder with
respect to such series, and execute and deliver an instrument transferring to
such successor trustee all the rights and powers of the trustee so ceasing to
act. Upon request of any such successor trustee, the Company shall execute any
and all instruments in writing for more fully and certainly vesting in and
confirming to such successor trustee all such rights and powers. Any Trustee
ceasing to act shall, nevertheless, retain a lien upon all property or funds
held or collected by such Trustee, except funds held in trust for the benefit of
the holders of particular Securities, to secure any amounts then due it pursuant
to the provisions of Section 6.06.
If a successor trustee is appointed with respect to the Securities of
one or more (but not all) series, the Company, the predecessor Trustee and each
successor trustee with respect to the Securities of any applicable series shall
execute and deliver an indenture supplemental hereto that shall contain such
provisions as shall be deemed necessary or desirable to confirm that all the
rights, powers, trusts and duties of the predecessor Trustee with respect to the
Securities of any series as to which the predecessor Trustee is not retiring
shall continue to be vested in the predecessor Trustee, and shall add to or
change any of the provisions of this Indenture as shall be
29
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, it being understood that nothing herein or
in such supplemental indenture shall constitute such Trustees as co-trustees of
the same trust and that each such Trustee shall be Trustee of a trust or trusts
under separate indentures.
No successor trustee with respect to any series of Securities shall
accept appointment as provided in this Section 6.11 unless at the time of such
acceptance such successor trustee shall be qualified under the provisions of
Section 6.08 and eligible under the provisions of Section 6.09.
Upon acceptance of appointment by a successor trustee as provided in
this Section 6.11, the Company shall mail to the holders of Securities of any
series by first-class mail notice thereof. If the Company fails to mail such
notice within 30 days after acceptance of appointment by the successor trustee,
the successor trustee shall, in its discretion, cause such notice to be mailed
at the expense of the Company.
SECTION 6.12. Successor to Trustee by Merger, 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 or conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be qualified under the provisions of Section 6.08 and eligible
under the provisions of Section 6.09, without the execution or filing of any
paper or any further act on the part of any of the parties hereto, anything
herein to the contrary notwithstanding.
In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture and the Securities of any series shall have
been authenticated but not delivered, any such successor to the Trustee may
adopt the certificate of authentication of any predecessor Trustee, and deliver
such Securities so authenticated; and in case at that time the Securities of any
series shall not have been authenticated, any successor to the Trustee may
authenticate such Securities either in the name of any predecessor hereunder or
in the name of the successor Trustee; and in all such cases such certificates
shall have the full force that it is anywhere in the Securities of such series
or in this Indenture provided that the certificate of the Trustee shall have;
provided, however, that the right to adopt the certificate of authentication of
any predecessor Trustee or authenticate Securities of any series in the name of
any predecessor Trustee shall apply only to its successor or successors by
merger, conversion or consolidation.
SECTION 6.13. Limitations on Rights of Trustee as a Creditor. The
Trustee shall comply with Section 311 of the Trust Indenture Act of 1939.
ARTICLE SEVEN
CONCERNING THE SECURITYHOLDERS
SECTION 7.01. Evidence of Action by Securityholders. Whenever in this
Indenture it is provided that the holders of a specified percentage in aggregate
principal amount of the Securities of any or all series may take any action
(including the making of any demand or
30
request, the giving of any notice, consent, or waiver or the taking of any other
action) the fact that the holders of such specified percentage, determined as of
the time such action was taken or, if a record date was set with respect thereto
pursuant to Section 7.05, as of such record date, have joined therein may be
evidenced (a) by any instrument or any number of instruments of similar tenor
executed by Securityholders in person or by agent or proxy appointed in writing,
or (b) by the record of the holders of Securities voting in favor thereof at any
meeting of Securityholders duly called and held in accordance with the
provisions of Article Eight, or (c) by a combination of such instrument or
instruments and any such record of such a meeting of Securityholders, or (d) in
the case of Securities evidenced by a Global Security, by any electronic
transmission or other message, whether or not in written format, that complies
with the Depositary's applicable procedures.
SECTION 7.02. Proof of Execution of Instruments and of Holding of
Securities. Subject to the provisions of Sections 6.01, 6.02 and 8.05, proof of
the execution of any instrument by a Securityholder or his agent or proxy shall
be sufficient if made in accordance with such reasonable rules and regulations
as may be prescribed by the Trustee or in such manner as shall be satisfactory
to the Trustee.
The ownership of Securities shall be proved by the register of such
Securities, or by a certificate of the registrar thereof.
The Trustee may accept such other proof or require such additional
proof of any matter referred to in this Section 7.02 as it shall deem
reasonable, including electronic or other messages transmitted by the Depositary
in accordance with its applicable procedures.
The record of any Securityholders' meeting shall be proved in the
manner provided in Section 8.06.
SECTION 7.03. Who May be Deemed Owners of Securities. The Company, the
Trustee, any Paying Agent and any Security registrar may deem and treat the
person in whose name any Security shall be registered upon the books of the
Company for such series on the applicable record date as the absolute owner of
such Security (whether or not such Security shall be overdue and notwithstanding
any notation of ownership or other writing thereon) for the purpose of receiving
payment of or on account of the principal of, premium, if any, and interest on
such Security and for all other purposes; and neither the Company nor the
Trustee nor any Paying Agent nor any Security registrar shall be affected by any
notice to the contrary. All such payments so made to, or upon the order of, any
such holder shall be valid, and, to the extent of the sum or sums so paid,
effectual to satisfy and discharge the liability for moneys payable upon any
such Security.
SECTION 7.04. Securities Owned by Company or Controlled or Controlling
Persons Disregarded for Certain Purposes. In determining whether the holders of
the requisite aggregate principal amount of Securities have concurred in any
demand, direction, request, notice, consent, waiver or other action under this
Indenture, Securities that are owned by the Company or any other obligor on the
Securities or by any person directly or indirectly controlling or controlled by
or under direct or indirect common control with the Company or any other obligor
on the
31
Securities shall be disregarded and deemed not to be outstanding for the purpose
of any such determination, provided that for the purposes of determining whether
the Trustee shall be protected in relying on any such demand, direction,
request, notice, consent or waiver, only Securities that the Trustee knows are
so owned shall be so disregarded. Securities so owned that have been pledged in
good faith may be regarded as outstanding for the purposes of this Section 7.04,
if the pledgee shall establish to the satisfaction of the Trustee the pledgee's
right to vote such Securities and that the pledgee is not a person directly or
indirectly controlling or controlled by or under direct or indirect common
control with the Company or any such obligor. In case of a dispute as to such
right, any decision by the Trustee taken upon the advice of counsel shall be
full protection to the Trustee.
SECTION 7.05. Record Date for Action by Securityholders. Whenever in
this Indenture it is provided that holders of a specified percentage in
aggregate principal amount of the Securities of a series may take any action
(including the making of any demand or request, the giving of any direction,
notice, consent or waiver or the taking of any action), other than any action
taken at a meeting of Securityholders called pursuant to Article Eight, the
Company, pursuant to a resolution of its Board of Directors, or the holders of
at least ten percent in aggregate principal amount of the Securities of such
series then outstanding, may request the Trustee to fix a record date for
determining Securityholders entitled to notice of and to take any such action.
In case the Company or the holders of Securities of such series in the amount
above specified shall desire to request Securityholders of such series to take
any such action and shall request the Trustee to fix a record date with respect
thereto by written notice setting forth in reasonable detail the Securityholder
action to be requested, the Trustee shall promptly (but in any event within five
days of receipt of such request) fix a record date that shall be a Business Day
not less than 15 nor more than 20 days after the date on which the Trustee
receives such request. If the Trustee shall fail to fix a record date as
hereinabove provided, then the Company or the holders of Securities of such
series in the amount above specified may fix the same by mailing written notice
thereof (the record date so fixed to be a Business Day not less than 15 nor more
than 20 days after the date on which such written notice shall be given) to the
Trustee. If a record date is fixed according to this Section 7.05, only persons
shown as Securityholders of such series on the registration books for the
Company at the close of business on the record date so fixed shall be entitled
to take the requested action and the taking of any such action by the holders on
the record date of the required percentage of the aggregate principal amount of
the Securities of such series shall be binding on all Securityholders of such
series, provided that the taking of the requested action by the holders on the
record date of the percentage in aggregate principal amount of the Securities of
such series in connection with such action shall have been evidenced to the
Trustee, as provided in Section 7.01, not later than 180 days after such record
date.
SECTION 7.06. Instruments Executed by Securityholders Bind Future
Holders. At any time prior to (but not after) the evidencing to the Trustee, as
provided in Section 7.01, of the taking of any action by the holders of the
percentage in aggregate principal amount of the Securities of any or all series
in connection with such action, any holder of a Security of such series the
serial number of which is shown by the evidence to be included in the Securities
of such series the holders of which have consented to such action may, by filing
written notice with the Trustee at its principal office and upon proof of
holding as provided in Section 7.02, revoke
32
such action so far as concerns such Security. Except as aforesaid any such
action taken by the holder of any Security of such series and any direction,
demand, request, waiver, consent, vote or other action of the holder of any
Security of such series that by any provisions of this Indenture is required or
permitted to be given shall be conclusive and binding upon such holder and upon
all future holders and owners of such Security, and of any Security issued in
lieu thereof, irrespective of whether or not any notation in regard thereto is
made upon such Security. Any action taken by the holders of the percentage in
aggregate principal amount of the Securities of such series in connection with
such action shall be conclusively binding as the act of such holders upon the
Company, the Trustee and the holders of the Securities of such series.
ARTICLE EIGHT
SECURITYHOLDERS' MEETINGS
SECTION 8.01. Purposes for Which Meetings May be Called. A meeting of
holders of Securities of any or all series, as the case may be, may be called at
any time and from time to time pursuant to the provisions of this Article Eight
for any of the following purposes:
(1) to give any notice to the Company or to the Trustee, or to
give any directions to the Trustee, or to consent to the waiving of any
default or Event of Default hereunder and its consequences, or to take
any other action authorized to be taken by Securityholders of any or
all series pursuant to any of the provisions of Article Five;
(2) to remove the Trustee and appoint a successor Trustee
pursuant to the provisions of Article Six;
(3) to consent to the execution of an indenture or indentures
supplemental hereto pursuant to the provisions of Section 9.02; or
(4) to take any other action authorized to be taken by or on
behalf of the holders of the percentage in aggregate principal amount
of the Securities of any or all series under any other provisions of
this Indenture or under applicable law.
SECTION 8.02. Manner of Calling Meetings; Record Date. The Trustee may
at any time call a meeting of Securityholders of any or all series to take any
action specified in Section 8.01, to be held at such time and at such place in
the City of Dallas, Texas, as the Trustee shall determine. Notice of every
meeting of the Securityholders of any or all series, setting forth the time and
the place of such meeting and in general terms the action proposed to be taken
at such meeting, shall be mailed nor less than thirty nor more than sixty days
prior to the date fixed for the meeting to such Securityholders at their
registered addresses. For the purpose of determining Securityholders entitled to
notice of any meeting of Securityholders, the Trustee shall fix in advance a
date as the record date for such determination, such date to be a Business Day
not more than ten days prior to the date of the mailing of such notice as
hereinabove provided. Only persons in whose name any Security shall be
registered upon the books of the Company on a Record Date fixed by the Trustee
as aforesaid, or by the Company or the Securityholders as in
33
Section 8.03 provided, shall be entitled to notice of the meeting of
Securityholders with respect to which such record date was so fixed.
SECTION 8.03. Call of Meeting by Company or Securityholders. In case at
any time the Company, pursuant to a resolution of its Board of Directors, or the
holders of at least ten percent in aggregate principal amount of the Securities
then outstanding of any or all series, as the case may be, shall have requested
the Trustee to call a meeting of such Securityholders to take any action
authorized in Section 8.01 by written request setting forth in reasonable detail
the action proposed to be taken at the meeting, and the Trustee shall not have
mailed notice of such meeting within twenty days after receipt of such request,
then the Company or the holders of such Securities in the amount above
specified, as the case may be, may fix the record date with respect to, and
determine the time and the place in said City of Dallas, Texas for, such meeting
and may call such meeting to take any action authorized in Section 8.01, by
mailing notice thereof as provided in Section 8.02. The record date fixed as
provided in the preceding sentence shall be set forth in a written notice to the
Trustee and shall be a Business Day not less than 15 nor more than 20 days after
the date on which such notice is sent to the Trustee.
SECTION 8.04. Who May Attend and Vote at Meetings. To be entitled to
vote at any meeting of Securityholders a person shall be (i) a holder of one or
more Securities of the series with respect to which the meeting is called or,
should the meeting be called with respect to the Securities of all series, a
holder of one or more of such series, or (ii) a person appointed by an
instrument in writing as proxy by a holder of one or more Securities of the
series. The only persons who shall be entitled to be present or to speak at any
meeting of Securityholders shall be the persons entitled to vote at such meeting
and their counsel and any representatives of the Trustee and its counsel and any
representatives of the Company and its counsel. When a determination of
Securityholders entitled to vote at any meeting of Securityholders has been made
as provided in this Section 8.04, such determination shall apply to any
adjournment thereof.
SECTION 8.05. Regulations. Notwithstanding any other provisions of this
Indenture, the Trustee may make such reasonable regulations as it may deem
advisable for any meeting of Securityholders, in regard to proof of the holding
of Securities of the series with respect to which the meeting is called and of
the appointment of proxies, and in regard to the appointment and duties of
inspectors of votes, the submission and examination of proxies, certificates and
other evidence of the right to vote, and such other matters concerning the
conduct of the meeting as it shall think fit. Except as otherwise permitted or
required by any such regulations, the holding of such Securities and the
appointment of any proxy shall be proved in the manner specified in Section
7.02.
The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Securityholders as provided in Section 8.03, in which case the
Company or the Securityholders calling the meeting, as the case may be, shall in
like manner appoint a temporary chairman. A permanent chairman and a permanent
secretary of the meeting shall be elected by a vote of the holders of a majority
in principal amount of the Securities represented at the meeting and entitled to
vote.
34
Subject to the provisions of Section 7.04, at any meeting each
Securityholder or proxy entitled to vote thereat shall be entitled to one vote
for each $1,000 principal amount of Securities held or represented by him;
provided, however, that no vote shall be cast or counted at any meeting in
respect of any Security challenged as not outstanding and ruled by the chairman
of the meeting to be not outstanding. The chairman of the meeting shall have no
right to vote other than by virtue of Securities held by him or instruments in
writing as aforesaid duly designating him as the person to vote on behalf of
other Securityholders. Any meeting of Securityholders duly called pursuant to
the provisions of Section 8.02 or 8.03 may be adjourned from time to time, and
the meeting may be held as so adjourned without further notice.
At any meeting of Securityholders, the presence of persons who held, or
who are acting as proxy for persons who held, an aggregate principal amount of
Securities of the series with respect to which the meeting is called on the
record date for such meeting sufficient to take action on the business for the
transaction of which such meeting was called shall constitute a quorum, but, if
less than a quorum is present, the persons holding or representing a majority in
aggregate principal amount of the Securities of the series with respect to which
the meeting is called represented at the meeting may adjourn such meeting with
the same effect, for all intents and purposes, as though a quorum had been
present.
SECTION 8.06. Manner of Voting at Meetings and Record to be Kept. The
vote upon any resolution submitted to any meeting of Securityholders shall be by
written ballots on each of which shall be subscribed the signature of the
Securityholder or proxy casting such ballot and the identifying number or
numbers of the Securities held or represented in respect of which such ballot is
cast. The permanent chairman of the meeting shall appoint two inspectors of
votes who shall count all votes cast at the meeting for or against any
resolution and who shall make and file with the secretary of the meeting their
verified written reports in duplicate of all votes cast at the meeting. A record
in duplicate of the proceedings of each meeting of Securityholders shall be
prepared by the secretary of the meeting and there shall be attached to said
record the original reports of the inspectors of votes on any vote by ballot
taken thereat and affidavits by one or more persons having knowledge of the
facts setting forth a copy of the notice of the meeting and showing that said
notice was mailed as provided in Section 8.02. The record shall show the
identifying numbers of the Securities voting in favor of or against any
resolution. Each counterpart of such record shall be signed and verified by the
affidavits of the permanent chairman and secretary of the meeting and one of the
counterparts shall be delivered to the Company and the other to the Trustee to
be preserved by the Trustee.
Any counterpart record so signed and verified shall be conclusive
evidence of the matters therein stated and shall be the record referred to in
clause (b) of Section 7.01.
SECTION 8.07. Exercise of Rights of Trustee and Securityholders Not to
be Hindered or Delayed. Nothing in this Article Eight contained shall be deemed
or construed to authorize or permit, by reason of any call of a meeting of
Securityholders or any rights expressly or impliedly conferred hereunder to make
such call, any hindrance or delay in the exercise of any right or rights
conferred upon or reserved to the Trustee or to the Securityholders under any of
the provisions of this Indenture or of the Securities of any or all series.
35
SECTION 8.08. Written Consent in Lieu of Meeting of Securityholders.
The written authorization or consent of the requisite percentage of
Securityholders herein provided, entitled to vote at any such meeting, evidenced
as provided in Article Seven and filed with the Trustee, shall be effective in
lieu of a meeting of Securityholders, with respect to any matter provided for in
this Article Eight.
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 9.01. Purposes for Which Supplemental Indentures May be Entered
into Without Consent of Securityholders. The Company, when authorized by a
resolution of its Board of Directors, and the Trustee may from time to time and
at any time enter into an indenture or indentures supplemental hereto (which
shall comply with the provisions of the Trust Indenture Act of 1939 as then in
effect) for one or more of the following purposes:
(a) to evidence the succession of another entity to the
Company, or successive successions, and the assumption by the successor
entity of the covenants, agreements and obligations of the Company
pursuant to Article Ten;
(b) to add to the covenants of the Company such further
covenants, restrictions or conditions as its Board of Directors and the
Trustee shall consider to be for the protection of the holders of all
or any series of the Securities (and, if such covenants are to be for
the benefit of less than all series of Securities stating that such
covenants are expressly being included for the benefit of such series),
and to make the occurrence, or the occurrence and continuance, of a
default in any of such additional covenants, restrictions or conditions
an Event of Default permitting the enforcement of all or any of the
several remedies provided in this Indenture as herein set forth;
provided, however, that in respect of any such additional covenant,
restriction or condition such supplemental indenture may provide for a
particular period of grace after default (which period may be shorter
or longer than that allowed in the case of other defaults) or may
provide for an immediate enforcement upon such Event of Default or may
limit the remedies available to the Trustee upon such Event of Default
or may limit the right of the holders of a majority in aggregate
principal amount of the Securities of such series to waive such an
Event of Default;
(c) to cure any ambiguity or to correct or supplement any
provision contained herein or in any supplemental indenture that may be
defective or inconsistent with any other provision contained herein or
in any supplemental indenture, or to make such other provisions in
regard to matters or questions arising under this Indenture or any
supplemental indenture as shall not adversely affect the interests of
the holders of the Securities;
(d) to provide for the issuance under this Indenture of
Securities, whether or not then outstanding, in coupon form (including
Securities registrable as to principal only)
36
and to provide for exchangeability of such Securities with Securities
issued hereunder in fully registered form and to make all appropriate
changes for such purpose;
(e) to establish the form or terms and to provide for the
issuance of Securities of any series as permitted by Sections 2.01 and
2.03; and
(f) to evidence and provide for the acceptance of appointment
hereunder by a successor trustee with respect to the Securities of one
or more series and to add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one trustee.
The Trustee is hereby authorized to join with the Company in the
execution of any such supplemental indenture, to make any further appropriate
agreements and stipulations that may be therein contained and to accept the
conveyance, transfer or assignment of any property thereunder, provided that if
any such supplemental indenture affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise, the Trustee may in its discretion,
but shall not be obligated to, enter into such supplemental indenture.
Any supplemental indenture authorized by the provisions of this Section
9.01 may be executed by the Company and the Trustee without the consent of the
holders of any of the Securities at the time outstanding, notwithstanding any of
the provisions of Section 9.02.
SECTION 9.02. Modification of Indenture with Consent of Holders of a
Majority in Principal Amount of Securities. With the consent (evidenced as
provided in Section 7.01) of the holders of not less than a majority in
aggregate principal amount of the Securities at the time outstanding of all
Securities affected by such supplement (voting as one class) (determined as
provided in Section 7.04), or, if a record date is set with respect to such
consent in accordance with Section 7.05, as of such record date, the Company,
when authorized by a resolution of its Board of Directors, and the Trustee may
from time to time and at any time enter into an indenture or indentures
supplemental hereto (which shall comply with the provisions of the Trust
Indenture Act of 1939 as then in effect) for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Indenture or of any supplemental indenture or of modifying in any manner
the rights of the holders of the Securities of each such series; provided,
however, that no such supplemental indenture shall (i) extend the stated
maturity of any Security, or reduce the rate or extend the time of payment of
interest thereon or reduce any amount payable on redemption thereof or reduce
the amount of the principal of an Original Issue Discount Security that would be
due and payable upon an acceleration of the maturity thereto pursuant to Section
5.01, or impair or affect the right of any Securityholder to institute suit for
the payment thereof or the right of repayment if any, at the option of the
Securityholder, without the consent of the holder of each Security so affected
or (ii) reduce the aforesaid percentage of Securities of any series or of all
series (voting as one class), as the case may be, the consent of the holders of
which is required for any such supplemental indenture, without the consent of
the holders of all Securities of each such series so affected.
A supplemental indenture that changes or eliminates any covenant or
other provision of this Indenture that has expressly been included solely for
the benefit of one or more particular
37
series of Securities, or that modified the rights of holders of such series with
respect to such covenant or provision, shall be deemed not to affect the rights
under this Indenture of the holders of any other series.
Upon the request of the Company, accompanied by a copy of a resolution
of its Board of Directors certified by the Secretary or an Assistant Secretary
of the Company authorizing the execution of any such supplemental indenture, and
upon the filing with the Trustee of evidence of the consent of Securityholders
as aforesaid, the Trustee shall join with the Company in the execution of such
supplemental indenture, provided that if such supplemental indenture affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise,
the Trustee may in its discretion, but shall not be obligated to, enter into
such supplemental indenture.
It shall not be necessary for the consent of the Securityholders under
this Section 9.02 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.
Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section 9.02, the
Company shall mail a notice to the Securityholders of each series affected
thereby, setting forth in general terms the substance of such supplemental
indenture. Any failure of the Company to mail such notice, or any defect
therein, shall not, however, in any way impair or affect the validity of any
such supplemental indenture.
SECTION 9.03. Effect of Supplemental Indentures. Upon the execution of
any supplemental indenture pursuant to the provisions of this Article Nine, this
Indenture shall be and be deemed to be modified and amended in accordance
therewith and the respective rights, limitation of rights, obligations, duties
and immunities under this Indenture of the Trustee, the Company and the holders
of Securities of each series affected thereby shall thereafter be determined,
exercised and enforced hereunder subject in all respects to such modifications
and amendments, and all the terms and conditions of any such supplemental
indenture shall be and be deemed to be part of the terms and conditions of this
Indenture for any and all purposes.
SECTION 9.04. Securities May Bear Notation of Changes by Supplemental
Indentures. Securities of any series authenticated and delivered after the
execution of any supplemental indenture affecting such series pursuant to the
provisions of this Article Nine, or after any action taken at a Securityholders'
meeting pursuant to Article Eight, may bear a notation in form approved by the
Trustee as to any matter provided for in such supplemental indenture or as to
any action taken at any such meeting. If the Company or the Trustee shall so
determine, new Securities of any series so modified as to conform, in the
opinion of the Trustee and the Board of Directors of the Company, to any
modification of this Indenture contained in any such supplemental indenture may
be prepared by the Company, authenticated by the Trustee and delivered in
exchange for the Securities of such series then outstanding.
SECTION 9.05. Opinion of Counsel. The Trustee, subject to the
provisions of Sections 6.01 and 6.02, may rely upon, and shall be entitled to
receive, an Opinion of Counsel as
38
conclusive evidence that any such supplemental indenture complies with the
provisions of this Article Nine.
ARTICLE TEN
CONSOLIDATION, MERGER AND SALE
SECTION 10.01. Company May Consolidate, etc., on Certain Terms. Nothing
contained in this Indenture or in any of the Securities shall prevent any
consolidation or merger of the Company with or into any other corporation,
limited partnership, limited liability company or other entity (whether or not
affiliated with the Company) or successive consolidations or mergers in which
the Company or its successor or successors shall be a party or parties, or shall
prevent any sale or conveyance of the property of the Company as an entirety, or
substantially as an entirety, to any other corporation, limited partnership,
limited liability company or other entity (whether or not affiliated with the
Company) authorized to acquire and operate the same; provided, however, and the
Company hereby covenants and agrees, that any such consolidation, merger, sale
or conveyance shall be upon the condition that (a) immediately after such
consolidation, merger, sale or conveyance no Event of Default, and no event that
upon notice or lapse of time, or both, would become an Event of Default, shall
have occurred and be continuing with respect to the entity (whether the Company
or such other entity) formed by or surviving any such consolidation or merger,
or to which such sale or conveyance shall have been made; (b) the entity (if
other than the Company) formed by or surviving any such consolidation or merger,
or to which such sale or conveyance shall have been made, shall be organized
under the laws of the United States of America or any State thereof; and (c) the
due and punctual payment of the principal of, premium, if any, and interest on
all of the Securities, according to their tenor, and the due and punctual
performance and observance of all the covenants and conditions of this Indenture
to be performed or observed by the Company, shall be expressly assumed, by
supplemental indenture complying with the requirements of Article Nine,
satisfactory in form to the Trustee, executed and delivered to the Trustee by
the entity formed by such consolidation, or into which the Company shall have
been merged, or by the entity that shall have acquired such property. If at any
time there shall be any consolidation or merger or sale or conveyance of
property to which the covenant of this Section 10.01 is applicable, then in any
such event the successor entity will promptly deliver to the Trustee:
(1) an Officers' Certificate stating that as of the time
immediately after the effective date of any such transaction the
covenants of the Company and conditions contained in this Section 10.01
have been complied with and the successor entity is not in default
under the provisions of this Indenture; and
(2) an Opinion of Counsel stating that in the opinion of such
counsel such covenants have been complied with and that any instrument
or instruments executed in the performance of such covenants comply
with the requirements thereof.
SECTION 10.02. Successor to be Substituted. In case of any such
consolidation, merger, sale or conveyance and upon the assumption by the
successor entity, in the manner hereinabove provided, of the due and punctual
payment of the principal or premium, if any, and
39
interest on all of the Securities and the due and punctual performance and
observance of all of the covenants and conditions of this Indenture to be
performed or observed by the Company, such successor entity shall succeed to and
be substituted for the Company, with the same effect as if it had been named
herein as the party of the first part. Such successor entity thereupon may cause
to be signed, and may issue either in its own name or in the name of Southwest
Airlines Co., any or all of the Securities issuable hereunder that theretofore
shall not have been signed by the Company and delivered to the Trustee; and,
upon the order of such successor entity (instead of the Company) and subject to
all the terms, conditions and limitations in this Indenture prescribed, the
Trustee shall authenticate and shall deliver any Securities that previously
shall have been signed and delivered by the officers of the Company to the
Trustee of authentication, and any Securities that such successor entity
thereafter shall cause to be signed and delivered to the Trustee for that
purpose. All the Securities so issued shall in all respects have the same legal
rank and benefit under this Indenture as the Securities theretofore or
thereafter issued in accordance with the terms of this Indenture as though all
of such Securities had been issued at the date of the execution hereof. In the
event of any such sale or conveyance and upon any such assumption, the Company
or any successor entity that shall theretofore have become such in the manner
described in this Article Ten shall be discharged from all obligations and
covenants under this Indenture and the Securities so assumed and may be
liquidated and dissolved.
In case of any such consolidation, merger, sale or conveyance such
changes in phraseology and form (but not in substance) may be made in the
Securities thereafter to be issued as may be appropriate.
ARTICLE ELEVEN
SATISFACTION AND DISCHARGE OF INDENTURE;
UNCLAIMED MONEYS
SECTION 11.01. Satisfaction and Discharge of Indenture. If at any time
(a) the Company shall have paid or caused to be paid the principal of and
interest on all the Securities of each series outstanding hereunder, as and when
the same shall have become due and payable, or (b) the Company shall have
delivered to the Trustee for cancellation (i) all securities of any series
theretofore authenticated (other than any Securities of any series that shall
have been destroyed, lost or stolen and that shall have been replaced or paid as
provided in Section 2.08) and (ii) Securities for whose payment moneys have
theretofore been deposited in trust and segregated and held in trust by the
Company and thereafter returned to the Company or discharged from such trust, as
provided in Section 11.04 or (c)(i) all such Securities not theretofore
delivered to the Trustee for cancellation shall have become due and payable, or
are by their terms to become due and payable within one year or are to be called
for redemption under arrangements satisfactory to the Trustee for the giving of
notice of redemption, and (ii) the Company shall have irrevocably deposited or
caused to be deposited with the Trustee as trust funds an amount (other than
moneys returned by the Trustee or any Paying Agent to the Company in accordance
with Section 11.04) sufficient to pay at maturity or upon redemption all such
Securities not theretofore delivered to the Trustee for cancellation, including
principal and interest due or to become due to such date of maturity or date of
redemption, as the case may be, and if, in any such case, the Company shall also
pay or cause to be paid all other sums payable
40
hereunder by the Company with respect to Securities of such series, then this
Indenture shall cease to be of further effect with respect to Securities of such
series (except as to (i) rights of registration of transfer and exchange, (ii)
substitution of apparently mutilated, defaced, destroyed, lost or stolen
Securities, (iii) the rights, obligations and immunities of the Trustee
hereunder and (iv) the rights of the Securityholders of such series as
beneficiaries hereof with respect to the property so deposited with the Trustee
payable to all or any of them), and the Trustee, on demand of the Company
accompanied by an Officers' Certificate and an Opinion of Counsel (each stating
that all conditions precedent herein provided for relating to the satisfaction
and discharge of this Indenture have been complied with) and at the cost and
expense of the Company, shall execute proper instruments acknowledging such
satisfaction of and discharging this Indenture with respect to such series;
provided that the rights of holders of the Securities of such series to receive
amounts in respect of principal of and interest on the Securities held by them
shall not be delayed longer than required by then-applicable mandatory rules or
polices of any securities exchange upon which the Securities of such series are
listed and provided further that the Company shall not be discharged from any
payment obligations in respect of any Securities, and such obligations shall be
reinstated, if the Trustee is unable to apply any money in accordance with this
Section by reason of any legal proceeding or any order or judgment of any court
or governmental authority enjoining, restraining or otherwise prohibiting such
application until such time as the Trustee is able to apply such money or the
obligations are otherwise satisfied. The Company agrees to reimburse the Trustee
of any costs or expenses thereafter reasonably and properly incurred and to
compensate the Trustee for any services thereafter reasonably and properly
rendered by the Trustee in connection with this Indenture or the Securities of
such series.
SECTION 11.02. Application by Trustee of Funds Deposited for Payment of
Securities. Subject to Section 11.04, all moneys deposited with the Trustee
pursuant to Section 11.01 shall be held in trust and applied by it to the
payment, either directly or through any Paying Agent (including the Company
acting as its own Paying Agent), to the holders of the particular Securities of
such series, for the payment or redemption of which such moneys have been
deposited with the Trustee, of all sums due and to become due thereon for
principal, interest and premium, if any.
SECTION 11.03. Repayment of Moneys Held by Paying Agent. In connection
with the satisfaction and discharge of this Indenture with respect to such
series of Securities, all moneys then held by any Paying Agent under the
provisions of this Indenture with respect to any such series of Securities
shall, upon demand of the Company or the Trustee, be paid to the Trustee and
thereupon such Paying Agent shall be released from all further liability with
respect to such moneys.
SECTION 11.04. Repayment of Moneys Held by Trustee. Unless otherwise
required by mandatory provisions of escheat or abandoned or unclaimed property
laws, any moneys deposited with the Trustee or any Paying Agent, or then held by
the Company, for the payment of the principal of, premium, if any, or interest
on any Securities of any series and not applied but remaining unclaimed by the
holders of Securities for two years after the date upon which such payment shall
have become due, shall be repaid to the Company by the Trustee or by such Paying
Agent on demand; or, if then held by the Company, shall be discharged from such
trust;
41
and thereupon the Trustee and such Paying Agent or the Company as trustee
shall be released from all further liability with respect to such moneys, and
the holder of any of the Securities of such series entitled to receive such
payment shall, unless otherwise required by mandatory provisions of applicable
escheat or abandoned or unclaimed property laws, thereafter look only to the
Company for the payment thereof; provided however, that the Trustee or Paying
Agent, before being required to make any such payment, may at the expense of the
Company cause to be published once, in a newspaper published in the English
language, customarily published on each Business Day and of general circulation
in New York City, or cause to be mailed to each Securityholder of such series,
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,
any unclaimed balance of such money then remaining will be repaid to the
Company.
SECTION 11.05. Satisfaction, Discharge and Defeasance of Securities of
any Series. If this Section 11.05 is specified, as contemplated by Section 2.03,
to be applicable to Securities of any series, the Company shall be deemed to
have paid and discharged the entire indebtedness on all the Securities of any
such series at the time outstanding, and the Trustee, at the expense of the
Company, shall execute proper instruments acknowledging satisfaction, discharge
and defeasance of such indebtedness, when
(1) either
(A) with respect to all Securities of such series at the time
outstanding,
(i) the Company has deposited or caused to be
deposited with the Trustee as trust funds in trust for the
purpose an amount sufficient to pay and discharge the entire
indebtedness on all such Securities for principal, premium, if
any, and interest, on the days on which such principal,
premium, if any, or interest, as the case may be, is due and
payable in accordance with the terms of this Indenture and
such Securities, to the date of maturity or date of redemption
thereof as contemplated by the penultimate paragraph of this
Section 11.05, as the case may be; or
(ii) the Company has deposited or caused to be
deposited with the Trustee as obligations in trust for the
purpose such amount of non-callable direct obligations of, or
obligations the principal of and interest on which are fully
guaranteed by, the United States of America as will, together
with the income to accrue thereon without consideration of any
reinvestment thereof, be sufficient to pay and discharge the
entire indebtedness on all such Securities for principal,
premium, if any, and interest, on the days on which such
principal, premium, if any, or interest, as the case may be,
is due and payable in accordance with the terms of this
Indenture and such Securities, to the date of maturity or date
of redemption thereof as contemplated by the penultimate
paragraph of this Section 11.05, as the case may be; or
42
(B) the Company has properly fulfilled such other means of
satisfaction and discharge as is specified, as contemplated by Section
2.03, to be applicable to the Securities of such series;
(2) the Company has paid or caused to be paid all other sums payable
with respect to the Securities of such series at the time outstanding and all
other amounts due under this Indenture with respect to such series;
(3) such deposit will not result in a breach or violation of, or
constitute a default under, this Indenture or any other agreement or instrument
to which the Company is a party or by which it is bound;
(4) no Event of Default or event that, after notice or lapse of time or
both, would become an Event of Default shall have occurred and be continuing on
the date of such deposit;
(5) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel to the effect that (i) the Company has received from,
or that there has been published by, the Internal Revenue Service a ruling, or
(ii) since the date of this Indenture there has been a change in applicable
federal income tax law, in either case to the effect that holders of the
Securities of such series will not recognize income, gain or loss for federal
income tax purposes as a result of such deposit, satisfaction, discharge and
defeasance and will be subject to federal income tax on the same amounts and in
the same manner and at the same times, as would have been the case if such
deposit, satisfaction, discharge and defeasance had not occurred; and
(6) 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, discharge and defeasance of the
entire indebtedness on all Securities of any such series at the time outstanding
have been complied with.
Any deposits with the Trustee referred to in Section 11.05(1)(A) above
shall be irrevocable and shall be made under the terms of an escrow trust
agreement in form and substance satisfactory to the Trustee. If any Securities
of such series at the time outstanding are to be redeemed prior to their stated
maturity, whether pursuant to any optional redemption provisions or in
accordance with any mandatory sinking fund requirement, the Company shall make
such arrangements as are satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the Company.
Upon the satisfaction of the conditions set forth in this Section 11.05
with respect to all the Securities of any series at the time outstanding, the
terms and conditions of such series, including the terms and conditions with
respect thereto set forth in this Indenture, shall no longer be binding upon, or
applicable to, the Company, provided that the Company shall not be discharged
from any payment obligations in respect of Securities of such series that are
deemed not to be outstanding under clause (c) of the definition thereof if such
obligations continue to be valid obligations in accordance with this Section by
reason of any legal proceeding or any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application.
43
ARTICLE TWELVE
IMMUNITY OF INCORPORATORS, SHAREHOLDERS, OFFICERS
AND OTHERS
SECTION 12.01. Incorporators, Shareholders, Officers and Others Exempt
from Individual Liability. No recourse under or upon any obligation, covenant or
agreement of this Indenture, or of any Security, or for any claim based thereon
or otherwise in respect thereof shall be had against any incorporator,
shareholder, officer, partner, member or director, as such, past, present or
future, of the Company or of any successor entity, either directly or through
the Company or such successor entity, whether by virtue of any constitution,
statute or rule of law, or by the enforcement of any assessment or penalty or
otherwise; it being expressly understood that this Indenture and the obligations
issued hereunder are solely corporate or similar obligations, and that no such
personal liability whatever shall attach to, or is or shall be incurred by, the
incorporators, shareholders, officers, partners, members or directors, as such,
past, present or future, of the Company or of any successor entity, or any of
them, because of the reason of the indebtedness hereby authorized, or under or
by reason of the obligations, covenants or agreements contained in this
Indenture or in any of the Securities or implied therefrom; and that any and all
such personal liability of every name and nature, either at common law or in
equity or by constitution or statute, of and any and all such rights and claims
against, every such incorporator, shareholder, officer, partner, member or
director, as such, because of the creation of the indebtedness hereby
authorized, or under or by reason of the obligations, covenants or agreements
contained in this Indenture or in any of the Securities or implied therefrom are
hereby expressly waived and released as a condition of, and as a consideration
for, the execution of this Indenture and the issue of such Securities.
ARTICLE THIRTEEN
MISCELLANEOUS PROVISIONS
SECTION 13.01. Successors and Assigns of Company Bound by Indenture.
All the covenants, stipulations, promises and agreements in this Indenture
contained by or on behalf of the Company shall bind its successors and assigns,
whether so expressed or not.
SECTION 13.02. Acts of Board, Committee or Officer of Successor Entity
Valid. Any act or proceeding by any provision of this Indenture authorized or
required to be done or performed by any board, committee or officer of the
Company shall and may be done and performed with like force and effect by the
like board, committee or officer (or persons performing similar duties) of any
entity that shall at the time be the lawful sole successor of the Company.
SECTION 13.03. Required Notices or Demands May be Served by Mail;
Waiver. Any notice, direction, request or demand that by any provisions of this
Indenture is required or permitted to be given or served by the Trustee or by
the holders of Securities to or on the Company shall be in the English language
and may be given or served by being deposited,
44
postage prepaid, certified or registered mail, addressed (until another address
is filed by the Company with the Trustee for such purpose), as follows:
Southwest Airlines Co., ▇.▇. ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention:
Treasurer. Any notice, direction, request or demand by any Securityholder to or
upon the Trustee shall be deemed to have been sufficiently given or made, for
all purposes, if given or made at the principal office of the Trustee.
Where this Indenture provides for notice to Securityholders, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing in the English language and mailed, first class, postage prepaid,
to each holder entitled thereto, at his last address as it appears in the
Security register or registers. 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.
In case, by reason of the suspension of or irregularities in regular
mail service, it shall be impracticable to mail notice to the Company or
Securityholders when such notice is required to be given pursuant to any
provision of this Indenture, then any manner of giving such notice as shall be
satisfactory to the Trustee shall be deemed to be a sufficient giving of such
notice.
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 or action relating thereto, and such waiver shall be
the equivalent of such notice. Waivers of notice by Securityholders shall be
filed with the Trustee, but such filing shall not be a condition precedent to
the validity of any action taken in reliance upon such waiver.
SECTION 13.04. Indenture and Securities to be Construed in Accordance
with the Laws of the State of Texas. This Indenture and each Security shall be
deemed to be a contract made under the laws of the State of Texas, and for all
purposes shall be construed in accordance with the laws of said State, except as
otherwise required by mandatory provisions of law.
SECTION 13.05. Evidence of Compliance with Conditions Precedent. Upon
any request or application by the Company to the Trustee to take any action
under any of the provisions as of this Indenture, the Company shall furnish to
the Trustee an Officers' Certificate stating that all conditions precedent, if
any, provided for in this Indenture relating to the proposed action have been
complied with, and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent have been complied with, except that in
the case of any such application or demand as to which the furnishing of such
documents is specifically required by any provision of this Indenture relating
to such particular application or demand, no additional certificate or opinion
need be furnished.
Each certificate or opinion provided for in this Indenture and
delivered to the Trustee with respect to compliance with a condition or covenant
provided for in this Indenture shall include (1) a statement that the person
making such certificate or opinion has read such covenant or condition; (2) a
brief statement as to the nature and scope of the examination or investigation
upon which the statements or opinions contained in such certificate or opinion
are based; (3) a statement that, in the opinion of such person, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or
45
condition has been complied with; and (4) a statement as to whether or not, in
the opinion of such person, such condition or covenant has been complied with.
Any certificate, statement or opinion of an officer of the 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 that the certificate
or opinion or representations with respect to the matters upon which his
certificate, statement or opinion may be based as aforesaid are erroneous, or in
the exercise of reasonable care should know that the same are erroneous. Any
certificate, statement or opinion of counsel may be based, insofar as it relates
to factual matters, on information that is in the possession of the Company,
upon the certificate, statement or opinion of or representations by an officer
or officers of the Company, unless such counsel knows that the certificate,
statement or opinion or representations with respect to the matters upon which
his certificate, statement or opinion may be based as aforesaid are erroneous,
or in the exercise of reasonable care should know that the same are erroneous.
Any certificate, statement or opinion of an officer of the Company or
of counsel may be based, insofar as it relates to accounting matters, upon a
certificate or opinion of or representations by an accountant or firm of
accountants unless such officer or counsel, as the case may be, knows that the
certificate or opinion or representations with respect to the accounting matters
upon which his certificate, statement or opinion may be based as aforesaid are
erroneous, or in the exercise of reasonable care should know that the same are
erroneous. Any certificate or opinion of any independent firm of public
accountants filed with the Trustee shall contain a statement that such firm is
independent.
SECTION 13.06. Payments Due on Saturdays, Sundays, and Holidays. In any
case where the date of payment of interest on or principal of the Securities of
any series, or the date fixed for redemption or repayment of any such Security,
shall not be a Business Day, then payment of interest or principal (and premium,
if any) need not be made on such date, but may be made on the next succeeding
Business Day with the same force and effect as if made on the date of payment or
the date fixed for redemption, and no interest shall accrue for the period after
such date.
SECTION 13.07. Provisions Required by Trust Indenture Act of 1939 to
Control. If and to the extent that any provision of this Indenture limits,
qualifies or conflicts with the duties imposed by operation of subsection (c) of
Section 318 of the Trust Indenture Act of 1939, the imposed duties shall
control.
SECTION 13.08. Provisions of this Indenture and Security for the Sole
Benefit of the Parties and the Securityholders. Nothing in this Indenture or in
the Securities, expressed or implied, shall give or be construed to give any
person, firm or corporation, other than the parties hereto and their successors
and the holders of the Securities, any legal or equitable right, remedy or claim
under or in respect of this Indenture, or under any covenant, condition or
provision herein contained; all its covenants, conditions and provisions being
for the sole benefit of the parties hereto and their successors and the holders
of the Securities.
46
SECTION 13.09. Indenture May be Executed in Counterparts. This
Indenture may be executed in any number of counterparts, each of which shall be
an original; but such counterparts shall together constitute but one and the
same instrument.
SECTION 13.10. Article and Section Headings. The Article and Section
heading references herein and in the Table of Contents are for convenience only
and shall not affect the construction hereof.
SECTION 13.11. Severability. If any provision hereof shall be held to
be invalid, illegal or unenforceable under applicable law, then the remaining
provisions hereof shall be construed as though such invalid, illegal or
unenforceable provision were not contained herein.
ARTICLE FOURTEEN
REDEMPTION OF SECURITIES AND SINKING FUNDS
SECTION 14.01. Applicability of Article. The provisions of this Article
shall be applicable to the Securities of any series that are redeemable before
their maturity or to any sinking fund for the retirement of Securities of a
series, in either case as specified as contemplated by Section 2.03 for
Securities of such series.
SECTION 14.02. Notice of Redemption; Partial Redemptions. Notice of
redemption to the holders of Securities of any series to be redeemed as a whole
or in part shall be given by mailing notice of such redemption by first class
mail, postage prepaid, at least 20 days and not more than 60 days prior to the
date fixed for redemption to such holders of Securities of such series at their
last addresses as they shall appear upon the Security register or registers. Any
notice that is mailed in the manner herein provided shall be conclusively
presumed to have been duly given, whether or not the holder receives the notice.
Failure to give notice by mail, or any defect in the notice to the holder of any
Security of a series designated for redemption as a whole or in part shall not
affect the validity of the proceedings for the redemption of any other Security
of such series.
The notice of redemption to each such holder shall specify the
principal amount of each Security of such series held by such holder to be
redeemed, the date fixed for redemption, the redemption price (or the method of
calculating the redemption price), the place or places of payment, that payment
will be made upon presentation and surrender of such Securities, that such
redemption is pursuant to the mandatory or optional sinking fund, or both, if
such be the case, that interest accrued to the date fixed for redemption will be
paid as specified in said notice and that on and after said date interest
thereon or on the portions thereof to be redeemed will cease to accrue. In case
any Security of a series is to be redeemed in part only the notice of redemption
shall state the portion of the principal amount thereof to be redeemed and shall
state that on and after the date fixed for redemption, upon surrender of such
Security, a new Security or Securities of such series in principal amount equal
to the unredeemed portion thereof will be issued.
47
The notice of redemption of Securities of any series to be redeemed at
the option of the Company shall be given by the Company or, at the Company's
request, by the Trustee for such series in the name and at the expense of the
Company.
No later than 11:00 a.m., New York City time, on the redemption date
specified in the notice of redemption given as provided in this Section, the
Company will deposit with the Trustee or with one or more Paying Agents (or, if
the Company is acting as its own Paying Agent, set aside, segregate and hold in
trust as provided in Section 3.04) an amount of money sufficient to redeem on
the redemption date all the Securities of such series so called for redemption
at the appropriate redemption price, together with accrued interest to the date
fixed for redemption. If less than all the outstanding Securities of a series
are to be redeemed, the Company will deliver to the Trustee at least 70 days (or
such shorter period acceptable to the Trustee) prior to the date fixed for
redemption an Officers' Certificate stating the aggregate principal amount of
Securities to be redeemed.
If less than all the Securities of a series are to be redeemed, the
Trustee shall select, in such manner as it shall deem appropriate and fair,
Securities of such series to be redeemed in whole or in part. Securities may be
redeemed in part in multiples equal to the minimum authorized denomination for
Securities of such series or any integral multiple thereof. The Trustee shall
promptly notify the Company in writing of the Securities of such series selected
for redemption and, in the case of any Securities of such series selected for
partial redemption, the principal amount of each such Security to be redeemed.
For all purposes of this Indenture, unless the context otherwise requires, all
provisions relating to the redemption of the Securities of any series shall
relate, in the case of any Security redeemed or to be redeemed only in part, to
the portion of the principal amount of such Security which has been or is to be
redeemed.
SECTION 14.03. Payment of Securities Called for Redemption. If notice
of redemption has been given as above provided, the Securities or portions of
Securities specified in such notice shall become due and payable on the date and
at the place or places stated in such notice at the applicable redemption price,
together with interest accrued to the date fixed for redemption, and on and
after said date (unless the Company shall default in the payment of such
Securities at the redemption price, together with interest accrued to said date)
interest on the Securities or portions of Securities so called for redemption
shall cease to accrue and, except as provided in Sections 6.05 and 11.04, such
Securities shall cease from and after the date fixed for redemption to be
entitled to any benefit or security under this Indenture, and the holders
thereof shall have no right in respect of such Securities except the right to
receive the redemption price thereof and unpaid interest to the date fixed for
redemption. On presentation and surrender of such Securities at a place of
payment specified in said notice, said Securities or the specified portions
thereof shall be paid and redeemed by the Company at the applicable redemption
price, together with interest accrued thereon to the date fixed for redemption;
provided that any semiannual payment of interest becoming due on the date fixed
for redemption shall be payable to the holders of such Securities registered as
such on the relevant record date subject to the terms and provisions of Section
2.03 hereof.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal shall, until paid or duly
provided for, bear interest from the date fixed
48
for redemption at the rate of interest or Yield to Maturity (in the case of an
Original Issue Discount Security) borne by the Security.
Upon presentation of any Security redeemed in part only, the Company
shall execute and the Trustee shall authenticate and deliver to or on the order
of the holder thereof, at the expense of the Company, a new Security or
Securities of such series, of authorized denominations, in principal amount
equal to the unredeemed portion of the Security so presented.
SECTION 14.04. Exclusion of Certain Securities from Eligibility for
Selection for Redemption. Securities shall be excluded from eligibility for
selection for redemption if they are identified by registration and certificate
number in a written statement signed by an authorized officer of the Company and
delivered to the Trustee at least 10 (or such lesser number as the Trustee may
permit) days prior to the last date on which notice of redemption may be given
as being owned by, and not pledged or hypothecated by, either (i) the Company or
(ii) an Affiliate specifically identified in such written statement.
SECTION 14.05. Mandatory and Optional Sinking Funds. The minimum amount
of any sinking fund payment provided for by the terms of Securities of any
series is herein referred to as a "mandatory sinking fund payment," and any
payment in excess of such minimum amount provided for by the terms of Securities
of any series is herein referred to as an "optional sinking fund payment." The
last date on which a sinking fund payment may be made in each year is herein
referred to as the "sinking fund payment date."
In lieu of making all or any part of any mandatory sinking fund payment
with respect to any series of Securities in cash, the Company may at its option
(i) deliver to the Trustee Securities of such series theretofore purchased or
otherwise acquired (except upon redemption pursuant to the mandatory sinking
fund) by the Company or receive credit for Securities of such series (not
previously so credited) theretofore purchased or otherwise acquired (except as
aforesaid) by the Company and delivered to the Trustee for cancellation pursuant
to Section 2.09, (ii) receive credit for optional sinking fund payments (not
previously so credited) made pursuant to this Section, or (iii) receive credit
for Securities of such series (not previously so credited) redeemed by the
Company through any optional redemption provisions contained in the terms of
such Securities. Securities so delivered or credited shall be received or
credited by the Trustee at the sinking fund redemption price specified in such
Securities.
On or before the sixtieth day (or such later day, no later than the
twentieth, as the Trustee may permit) next preceding each sinking fund payment
date for any series, the Company will deliver to the Trustee a written statement
(which need not contain the statements required by Section 13.05) signed by an
authorized officer of the Company (i) specifying the portion of the mandatory
sinking fund payment to be satisfied by payment of cash and the portion to be
satisfied by credit of Securities of such series, (ii) stating that none of the
Securities of such series has theretofore been so credited, (iii) stating that
no defaults in the payment of interest or Events of Default with respect to such
series have occurred (which have not been waived or cured) and are continuing
and (iv) stating whether or not the Company intends to exercise its right to
make an optional sinking fund payment with respect to such series, and, if so,
specifying the amount of such optional sinking fund payment that the Company
intends to pay on or before
49
the next succeeding sinking fund payment date. Any Securities of such series to
be credited and required to be delivered to the Trustee in order for the Company
to be entitled to credit therefor as aforesaid that have not theretofore been
delivered to the Trustee shall be delivered for cancellation pursuant to Section
2.09 to the Trustee with such written statement (or reasonably promptly
thereafter if acceptable to the Trustee). Such written statement shall be
irrevocable and upon its receipt by the Trustee the Company shall become
unconditionally obligated to make all the cash payments therein referred to, if
any, on or before the next succeeding sinking fund payment date. Failure of the
Company, on or before any such sixtieth day (or such later day as the Trustee
may have permitted), to deliver such written statement and Securities specified
in this paragraph, if any, shall not constitute a default but shall constitute,
on and as of such date, the irrevocable election of the Company (i) that the
mandatory sinking fund payment for such series due on the next succeeding
sinking fund payment date shall be paid entirely in cash without the option to
deliver or credit Securities of such series in respect thereof and (ii) that the
Company will make no optional sinking fund payment with respect to such series
as provided in this Section.
If the sinking fund payment or payments (mandatory or optional or both)
made in cash plus any unused balance of any preceding sinking fund payments made
in cash shall exceed $50,000 (or a lesser sum if the Company shall so request)
with respect to the Securities of any particular series, such cash shall be
applied on the next succeeding sinking fund payment date to the redemption of
Securities of such series at the sinking fund redemption price together with
accrued interest to the date fixed for redemption. If such amount shall be
$50,000 or less and the Company makes no such request then it shall be carried
over until a sum in excess of $50,000 is available. The Trustee shall select, in
the manner provided in Section 14.02, for redemption on such sinking fund
payment date a sufficient principal amount of Securities of such series to
absorb said cash, as nearly as may be, and shall (if requested in writing by the
Company) inform the Company or an entity known by the Trustee to be an
Affiliate, as shown by the Security register or registers, and not known to the
Trustee to have been pledged or hypothecated by the Company or any such entity
or (ii) identified in a written statement delivered to the Trustee pursuant to
Section 14.04 as being owned by, and not pledged or hypothecated by, the Company
or an Affiliate shall be excluded from Securities of such series eligible for
selection for redemption. The Trustee, in the name and at the expense of the
Company (or the Company, if it shall so request the Trustee in writing) shall
cause notice of redemption of the Securities of such series to be given in
substantially the manner provided in Section 14.02 (and with the effect provided
in Section 14.03) for the redemption of Securities of such series in part at the
option of the Company. The amount of any sinking fund payments not so applied or
allocated to the redemption of Securities of such series shall be added to the
next cash sinking fund payment and, together with such payment, shall be applied
in accordance with the provisions of this Section 14.05. Any and all sinking
fund moneys held on the stated maturity date of the Securities of any particular
series (or earlier, if such maturity is accelerated), that are not held for the
payment or redemption of particular Securities of such series shall be applied,
together with other moneys if necessary, sufficient for the purpose, to the
payment of the principal of, and interest on, the Securities of such series at
maturity.
The Trustee shall not redeem or cause to be redeemed any Securities of
a series with sinking fund moneys or mail any notice of redemption of Securities
for such series by operation
50
of the sinking funds during the continuance of a default in payment of interest
on such Securities or of any Event of Default except that, where the mailing of
notice of redemption of any Securities shall theretofore have been made, the
Trustee shall redeem or cause to be redeemed such Securities, provided that it
shall have received from the Company a sum sufficient for such redemption.
Except as aforesaid, any moneys in the sinking fund for such series at the time
when any such default or Event of Default shall occur, and any moneys thereafter
paid into the sinking fund, shall, during the continuance of such default or
Event of Default, be deemed to have been collected under Article Five and held
for the payment of all such Securities. In case such Event of Default shall have
been waived as provided in Article Five or the default cured on or before the
sixtieth day preceding the sinking fund payment date in any year, such moneys
shall thereafter be applied on the next succeeding sinking fund payment date in
accordance with this Section to the redemption of such Securities.
▇▇▇▇▇ FARGO BANK, N.A., the party of the second part, hereby accepts
the trust in this Indenture declared and provided, upon the terms and conditions
hereinabove set forth.
IN WITNESS WHEREOF, SOUTHWEST AIRLINES CO. the party of the first part,
has caused this Indenture to be signed by its Chairman of the Board, a Vice
Chairman of the Board, its President or one of its Vice Presidents; and ▇▇▇▇▇
FARGO BANK, N.A., the party of the second part, has caused this Indenture to be
signed by one of its Vice Presidents, all as of the day and year first written
above.
SOUTHWEST AIRLINES CO.
By
------------------------------------
(Title)
------------------------------------
▇▇▇▇▇ FARGO BANK, N.A.,
By
------------------------------------
(Title) Vice President
------------------------------------
51