===============================================================================
AOL TIME WARNER INC.,
AMERICA ONLINE, INC.,
as Guarantor
TIME WARNER INC.,
as Guarantor
TIME WARNER COMPANIES, INC.,
as Guarantor
▇▇▇▇▇▇ BROADCASTING SYSTEM, INC.,
as Guarantor
and
THE CHASE MANHATTAN BANK,
Trustee
INDENTURE
Dated as of , 2001
-----------------
Providing for Issuance of Senior Securities in Series
===============================================================================
Table Showing Reflection in Indenture of Certain Provisions
of Trust Indenture Act of 1939,
as amended by the Trust Indenture Reform Act of 1990
--------------------
Reflected in Indenture
TIA Section
'SS' 310(a)(1)............................................................ 6.09
(a)(2)............................................................ 6.09
(a)(3)............................................................ Not Applicable
(a)(4)............................................................ Not Applicable
(a)(5)............................................................ 6.09
(b)............................................................... 6.08
'SS' 311(a)............................................................... 6.13(a)
(b)............................................................... 6.13(b)
(b)(2)............................................................ 7.03(a)
.................................................................. 7.03(b)
'SS' 312(a)............................................................... 7.01
.................................................................. 7.02(a)
(b)............................................................... 7.03(b)
(c)............................................................... 7.02(c)
'SS' 313 (a)............................................................... 7.03(a)
(b)............................................................... 7.03(b)
(c)............................................................... 7.03(a)
.................................................................. 7.03(b)
(d)............................................................... 7.03(c)
'SS' 314(a)(1)............................................................ 7.04
(a)(2)............................................................ 7.04
(a)(3)............................................................ 7.04
(a)(4)............................................................ 10.04
(b)............................................................... Not Applicable
(c)(1)............................................................ 1.02
(c)(2)............................................................ 1.02
(c)(3)............................................................ Not Applicable
(d)............................................................... Not Applicable
(e)............................................................... 1.02
'SS' 315(a)............................................................... 6.01(a)
.................................................................. 6.01(c)
(b)............................................................... 6.02
.................................................................. 7.03(a)
(c)............................................................... 6.01(b)
(d)............................................................... 6.01
2
(d)(1)............................................................ 6.01(a)
(d)(2)............................................................ 6.01(c)(2)
(d)(3)............................................................ 6.01(c)(3)
(e)............................................................... 5.14
'SS' 316(a)............................................................... 1.01
(a)(1)(A)......................................................... 5.02
.................................................................. 5.12
(a)(1)(B)......................................................... 5.13
(a)(2)............................................................ Not Applicable
(b)............................................................... 5.08
(c)............................................................... 1.04(d)
'SS' 317(a)(1)............................................................ 5.03
(a)(2)............................................................ 5.04
(b)............................................................... 10.03
'SS' 318(a)............................................................... 1.07
TABLE OF CONTENTS
Page
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Recitals of the Company............................................................. 1
Agreements of the Parties........................................................... 1
ARTICLE I
Definitions and Other Provisions of General Application
-------------------------------------------------------
SECTION 1.01. Definitions........................................................ 1
SECTION 1.02. Compliance Certificates and
Opinions........................................................ 13
SECTION 1.03. Form of Documents Delivered to
Trustee......................................................... 14
SECTION 1.04. Acts of Securityholders............................................ 15
SECTION 1.05. Notices, etc., to Trustee and
Company......................................................... 17
SECTION 1.06. Notices to Securityholders; Waiver................................. 17
SECTION 1.07. Conflict with Trust Indenture Act.................................. 18
SECTION 1.08. Effect of Headings and Table of
Contents........................................................ 18
SECTION 1.09. Successors and Assigns............................................. 18
SECTION 1.10. Separability Clause................................................ 18
SECTION 1.11. Benefits of Indenture.............................................. 18
SECTION 1.12. Governing Law...................................................... 19
SECTION 1.13. Counterparts....................................................... 19
SECTION 1.14. Judgment Currency.................................................. 19
ARTICLE II
Security Forms
--------------
SECTION 2.01. Forms Generally.................................................... 20
SECTION 2.02. Forms of Securities................................................ 20
SECTION 2.03. Form of Trustee's Certificate of
Authentication.................................................. 20
SECTION 2.04. Securities Issuable in the Form of a
Global Security................................................. 21
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Page
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ARTICLE III
The Securities
--------------
SECTION 3.01. General Title; General Limitations;
Issuable in Series; Terms of
Particular Series............................................... 23
SECTION 3.02. Denominations...................................................... 27
SECTION 3.03. Execution, Authentication and
Delivery and Dating............................................. 27
SECTION 3.04. Temporary Securities............................................... 29
SECTION 3.05. Registration, Transfer and
Exchange........................................................ 30
SECTION 3.06. Mutilated, Destroyed, Lost and Stolen
Securities...................................................... 31
SECTION 3.07. Payment of Interest; Interest Rights
Preserved....................................................... 32
SECTION 3.08. Persons Deemed Owners.............................................. 34
SECTION 3.09. Cancelation........................................................ 34
SECTION 3.10. Computation of Interest............................................ 35
SECTION 3.11. Delayed Issuance of Securities..................................... 35
ARTICLE IV
Satisfaction and Discharge
--------------------------
SECTION 4.01. Satisfaction and Discharge of
Indenture....................................................... 36
SECTION 4.02. Application of Trust Money......................................... 37
SECTION 4.03. Defeasance Upon Deposit of Funds or
Government Obligations.......................................... 38
SECTION 4.04. Reinstatement...................................................... 40
ARTICLE V
Remedies
--------
SECTION 5.01. Events of Default.................................................. 41
SECTION 5.02. Acceleration of Maturity; Rescission
and Annulment................................................... 43
SECTION 5.03. Collection of Indebtedness and Suits
for Enforcement by Trustee...................................... 45
SECTION 5.04. Trustee May File Proofs of Claim................................... 46
SECTION 5.05. Trustee May Enforce Claims Without
Possession of Securities........................................ 47
SECTION 5.06. Application of Money Collected..................................... 47
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Page
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SECTION 5.07. Limitation on Suits................................................ 48
SECTION 5.08. Unconditional Right of Securityholders
To Receive Principal, Premium and
Interest........................................................ 48
SECTION 5.09. Restoration of Rights and Remedies................................. 49
SECTION 5.10. Rights and Remedies Cumulative..................................... 49
SECTION 5.11. Delay or Omission Not Waiver....................................... 49
SECTION 5.12. Control by Securityholders......................................... 49
SECTION 5.13. Waiver of Past Defaults............................................ 50
SECTION 5.14. Undertaking for Costs.............................................. 50
SECTION 5.15. Waiver of Stay or Extension Laws................................... 51
ARTICLE VI
The Trustee
-----------
SECTION 6.01. Certain Duties and Responsibilities................................ 51
SECTION 6.02. Notice of Defaults................................................. 53
SECTION 6.03. Certain Rights of Trustee.......................................... 53
SECTION 6.04. Not Responsible for Recitals or
Issuance of Securities.......................................... 55
SECTION 6.05. May Hold Securities................................................ 55
SECTION 6.06. Money Held in Trust................................................ 55
SECTION 6.07. Compensation and Reimbursement..................................... 55
SECTION 6.08. Disqualification; Conflicting
Interests....................................................... 56
SECTION 6.09. Corporate Trustee Required;
Eligibility..................................................... 56
SECTION 6.10. Resignation and Removal............................................ 57
SECTION 6.11. Acceptance of Appointment by
Successor.......................................................... 59
SECTION 6.12. Merger, Conversion, Consolidation or
Succession to Business.......................................... 60
SECTION 6.13. Preferential Collection of Claims
Against Company................................................. 61
SECTION 6.14. Appointment of Authenticating Agent................................ 61
ARTICLE VII
Securityholders' Lists and Reports by Trustee and Company
---------------------------------------------------------
SECTION 7.01. Company To Furnish Trustee Names and
Addresses of Securityholders.................................... 63
SECTION 7.02. Preservation of Information;
Communications to Securityholders............................... 64
SECTION 7.03. Reports by Trustee................................................. 65
SECTION 7.04. Reports by Company................................................. 66
iii
Page
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ARTICLE VIII
Consolidation, Merger, Conveyance or Transfer
---------------------------------------------
SECTION 8.01. Consolidation, Merger, Conveyance or
Transfer on Certain Terms....................................... 66
SECTION 8.02. Successor Person Substituted....................................... 67
ARTICLE IX
Supplemental Indentures
-----------------------
SECTION 9.01. Supplemental Indentures Without
Consent of Securityholders...................................... 68
SECTION 9.02. Supplemental Indentures with Consent
of Securityholders.............................................. 69
SECTION 9.03. Execution of Supplemental Indentures............................... 71
SECTION 9.04. Effect of Supplemental Indentures.................................. 71
SECTION 9.05. Conformity with Trust Indenture Act................................ 72
SECTION 9.06. Reference in Securities to
Supplemental Indentures......................................... 72
ARTICLE X
Covenants
---------
SECTION 10.01. Payment of Principal, Premium and
Interest........................................................ 72
SECTION 10.02. Maintenance of Office or Agency.................................... 72
SECTION 10.03. Money for Security Payments To Be Held
in Trust........................................................ 73
SECTION 10.04. Statement as to Compliance......................................... 74
SECTION 10.05. Legal Existence.................................................... 75
SECTION 10.06. Limitation on Liens................................................ 75
SECTION 10.07. Waiver of Certain Covenants........................................ 78
ARTICLE XI
Redemption of Securities
------------------------
SECTION 11.01. Applicability of Article........................................... 78
SECTION 11.02. Election To Redeem; Notice to
Trustee............................................................ 79
SECTION 11.03. Selection by Trustee of Securities To
Be Redeemed..................................................... 79
iv
Page
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SECTION 11.04. Notice of Redemption............................................... 80
SECTION 11.05. Deposit of Redemption Price........................................ 81
SECTION 11.06. Securities Payable on Redemption Date.............................. 82
SECTION 11.07. Securities Redeemed in Part........................................ 82
SECTION 11.08. Provisions with Respect to Any Sinking
Funds........................................................... 82
SECTION 11.09. Rescission of Redemption........................................... 84
ARTICLE XII
Conversion
----------
SECTION 12.01. Conversion Privilege............................................... 85
SECTION 12.02. Conversion Procedure; Rescission of
Conversion; Conversion Price;
Fractional Shares............................................... 86
SECTION 12.03. Adjustment of Conversion Price for
Common Stock or Marketable
Securities...................................................... 89
SECTION 12.04. Consolidation or Merger of the
Company............................................................ 93
SECTION 12.05. Notice of Adjustment............................................... 94
SECTION 12.06. Notice in Certain Events........................................... 94
SECTION 12.07. Company To Reserve Stock or other
Marketable Securities; Registration;
Listing......................................................... 95
SECTION 12.08. Taxes on Conversion................................................ 96
SECTION 12.09. Conversion After Record Date....................................... 96
SECTION 12.10. Corporate Action Regarding Par Value
of Common Stock................................................. 97
SECTION 12.11. Company Determination Final........................................ 97
SECTION 12.12. Trustee's Disclaimer............................................... 97
ARTICLE XIII
Guarantees
----------
SECTION 13.01. Guarantees......................................................... 98
v
1
THIS INDENTURE between AOL TIME WARNER
INC., a Delaware corporation (hereinafter
called the "Company") having its principal
office at ▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, AMERICA ONLINE, INC., a Delaware
corporation ("America Online"), TIME WARNER
INC., a Delaware corporation ("Time Warner"),
TIME WARNER COMPANIES, INC., a Delaware
corporation ("TWC"), ▇▇▇▇▇▇ BROADCASTING
SYSTEM, INC., a Georgia corporation ("TBS"
and together with America Online, Time Warner
and TWC, the "Guarantors"), and THE CHASE
MANHATTAN BANK, a New York banking
corporation, trustee (hereinafter called the
"Trustee"), is made and entered into as of
the day of , 2001.
------- --------
Recitals of the Company
The Company has duly authorized the execution and delivery of
this Indenture to provide for the issuance of its debentures, notes, bonds or
other evidences of indebtedness, to be issued in one or more fully registered
series.
All things necessary to make this Indenture a valid agreement
of the Company, America Online, Time Warner, TWC and TBS in accordance with its
terms, have been done.
Agreements of the Parties
To set forth or to provide for the establishment of the terms
and conditions upon which the Securities are and are to be authenticated, issued
and delivered, and in consideration of the premises and the purchase of
Securities by the Holders thereof, it is mutually covenanted and agreed as
follows, for the equal and proportionate benefit of all Holders of the
Securities or of a series thereof, as the case may be:
ARTICLE I
Definitions and Other Provisions
of General Application
SECTION 1.01. Definitions. For all purposes of this
Indenture and of any indenture supplemental hereto,
2
except as otherwise expressly provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings
assigned to them in this Article, and include the plural as well as the
singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act or by Commission rule under the Trust Indenture Act,
either directly or by reference therein, have the meanings assigned to
them herein;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP and, except as
otherwise herein expressly provided, the term "generally accepted
accounting principles" with respect to any computation required or
permitted hereunder shall mean such accounting principles and any
accounting rules or interpretations promulgated by the Commission as
are generally accepted in the United States of America at the date of
this Indenture; and
(4) all references in this instrument to designated
"Articles", "Sections" and other subdivisions are to the designated
Articles, Sections and other subdivisions of this instrument as
originally executed. The words "herein", "hereof" and "hereunder" and
other words of similar import refer to this Indenture as a whole and
not to any particular Article, Section or other subdivision.
Certain terms, used principally in Article VI, are defined in
that Article.
"Act", when used with respect to any Securityholder, has the
meaning specified in Section 1.04.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
3
"America Online" means America Online, Inc., a Delaware
corporation and wholly owned subsidiary of the Company, until a successor shall
have become such pursuant to the applicable provisions of this Indenture, and
thereafter "America Online" shall mean such successor.
"Authenticating Agent" means any Person authorized by the
Company to authenticate Securities under Section 6.14.
"Board of Directors" means (i) the board of directors of the
Company, (ii) any duly authorized committee of such board, (iii) any committee
of officers of the Company or (iv) any officer of the Company acting, in the
case of (iii) or (iv), pursuant to authority granted by the board of directors
of the Company or any committee of such board.
"Board Resolution" means a copy of a resolution certified by
the Secretary or an Assistant Secretary of the Company to have been duly adopted
by the Board of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"Business Day" means, with respect to any series of
Securities, unless otherwise specified in a Board Resolution and an Officer's
Certificate with respect to a particular series of Securities, each day which is
not a Saturday, Sunday or other day on which banking institutions in the
pertinent Place or Places of Payment or the city in which the Corporate Trust
Office is located are authorized or required by law or executive order to be
closed.
"Closing Price" of the Common Stock or other Marketable
Security, as the case may be, shall mean the last reported sale price of such
stock or other Marketable Security (regular way) as shown on the Composite Tape
of the NYSE (or, if such stock or other Marketable Security is not listed or
admitted to trading on the NYSE, on the principal national securities exchange
on which such stock or other Marketable Security is listed or admitted to
trading), or, in case no such sale takes place on such day, the average of the
closing bid and asked prices on the NYSE (or, if such stock or other Marketable
Security is not listed or admitted to trading on the NYSE, on the principal
national securities exchange on which such stock or other Marketable Security is
listed or admitted to trading), or, if it is not listed or admitted to trading
on any national securities exchange, the average of the closing bid and asked
prices as reported by the National Association of Securities Dealers Automated
Quotation System (NASDAQ), or if such stock or other
4
Marketable Security is not so reported, the average of the closing bid and asked
prices as furnished by any member of the National Association of Securities
Dealers, Inc., selected from time to time by the Company for that purpose.
"Commission" means the Securities and Exchange Commission, as
from time to time constituted, created under the Securities Exchange Act of
1934, or, if at any time after the execution of this instrument such Commission
is not existing and performing the duties now assigned to it under the Trust
Indenture Act, then the body performing such duties at such time.
"Common Stock" shall mean the class of Common Stock, par value
$.01 per share, of the Company authorized at the date of this Indenture as
originally signed, or any other class of stock resulting from successive changes
or reclassifications of such Common Stock, and in any such case including any
shares thereof authorized after the date of this Indenture.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor shall have become such pursuant
to the applicable provisions of this Indenture, and thereafter "Company" shall
mean such successor.
"Company Request", "Company Order" and "Company Consent" mean
a written request, order or consent, respectively, signed in the name of the
Company by its Chairman of the Board, Chief Executive Officer, Co-Chief
Operating Officer or a Vice President, and by its Treasurer, an Assistant
Treasurer, Controller, an Assistant Controller, Secretary or an Assistant
Secretary, and delivered to the Trustee.
"Consolidated Net Worth" means, with respect to any Person, at
the date of any determination, the consolidated stockholders' or owners' equity
of the holders of capital stock or partnership interests of such Person and its
subsidiaries, determined on a consolidated basis in accordance with GAAP
consistently applied.
"Conversion Agent" means any Person authorized by the Company
to receive Securities to be converted into Common Stock or other Marketable
Securities on behalf of the Company. The Company initially authorizes the
Trustee to act as Conversion Agent for the Securities on its behalf. The Company
may at any time and from time to time authorize one or more Persons to act as
Conversion Agent in addition to or in place of the Trustee with respect to any
series of Securities issued under this Indenture.
5
"Conversion Price" means, with respect to any series of
Securities which are convertible into Common Stock or other Marketable
Securities, the price per share of Common Stock or the price per designated unit
of other Marketable Security at which the Securities of such series are so
convertible as set forth in the Board Resolution with respect to such series (or
in any supplemental indenture entered into pursuant to Section 9.01(9) with
respect to such series), as the same may be adjusted from time to time in
accordance with Section 12.03 (or such supplemental indenture).
"Converting Holder" shall have the meaning specified in
Section 12.02(c) of this Indenture.
"Corporate Trust Office" means the office of the Trustee at
which at any particular time its corporate trust business shall be principally
administered, which office at the date hereof is located at ▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
"Current Market Price" on any date shall mean the average of
the daily Closing Prices per share of Common Stock or of such other Marketable
Securities for any thirty (30) consecutive Trading Days selected by the Company
prior to the day in question, which thirty (30) consecutive Trading Day period
shall not commence more than forty-five (45) Trading Days prior to the day in
question; provided that with respect to Section 12.03(3), the "Current Market
Price" of the Common Stock or of such other Marketable Securities shall mean the
average of the daily Closing Prices per share of common Stock or of such other
Marketable Securities for the five (5) consecutive Trading Days ending on the
date of the distribution referred to in Section 12.03(3) (or if such date shall
not be a Trading Day, on the Trading Day immediately preceding such date).
"Defaulted Interest" has the meaning specified in Section
3.07.
"Depository" means, unless otherwise specified by the Company
pursuant to either Section 2.04 or 3.01, with respect to Securities of any
series issuable or issued as a Global Security, The Depository Trust Company,
New York, New York, or any successor thereto registered as a clearing agency
under the Securities Exchange Act of 1934, as amended, or other applicable
statute or regulation.
"Discharged" has the meaning specified in Section 4.03.
6
"Event of Default" has the meaning specified in Article V.
"Federal Bankruptcy Act" has the meaning specified in Section
5.01(5).
"GAAP" means generally accepted accounting principles as such
principles are in effect as of the date of this Indenture.
"Global Security", when used with respect to any series of
Securities issued hereunder, means a Security which is executed by the Company
and authenticated and delivered by the Trustee to the Depository or pursuant to
the Depository's instruction, all in accordance with this Indenture and an
indenture supplemental hereto, if any, or Board Resolution and pursuant to a
Company Request, which shall be registered in the name of the Depository or its
nominee and which shall represent, and shall be denominated in an amount equal
to the aggregate principal amount of, all of the Outstanding Securities of such
series or any portion thereof, in either case having the same terms, including,
without limitation, the same original issue date, date or dates on which
principal is due, and interest rate or method of determining interest.
"Guarantee" means the guarantees specified in Section
13.01(a) and (b).
"Guarantors" means America Online, Time Warner,
TBS and TWC.
"Holder", when used with respect to any Security, means a
Securityholder.
"Indenture" or "this Indenture" means this instrument as
originally executed or as it may from time to time be supplemented or amended by
one or more indentures supplemental hereto entered into pursuant to the
applicable provisions hereof and shall include the terms of particular series of
Securities established as contemplated by Section 3.01.
"Interest", when used with respect to an Original Issue
Discount Security which by its terms bears interest only after Maturity, means
interest payable after Maturity.
"Interest Payment Date", when used with respect to any series
of Securities, means the Stated Maturity of any installment of interest on those
Securities.
7
"Marketable Security" means any common stock, debt security or
other security of a Person which is (or will, upon distribution thereof, be)
listed on the NYSE, the American Stock Exchange or any national securities
exchange registered under Section 6 of the Securities Exchange Act of 1934, as
amended, or approved for quotation in the National Market System of the National
Association of Securities Dealers, Inc. Automated Quotations System or any
similar system of automated dissemination of quotations of securities prices in
the United States or for which there is a recognized market maker or trading
market.
"Material Subsidiary" means any Person that is a Subsidiary if
at the end of the most recent fiscal quarter of the Company, the aggregate
amount, determined in accordance with GAAP consistently applied, of securities
of, loans and advances to, and other investments in, such Person held by the
Company and its other Subsidiaries exceeded 10% of the Company's Consolidated
Net Worth.
"Material U.S. Subsidiary" means any Material Subsidiary that
is organized under the laws of the United States of America or any political
subdivision thereof (including any State thereof or the District of Columbia).
"Maturity", when used with respect to any Securities, means
the date on which the principal of any such Security becomes due and payable as
therein or herein provided, whether on a Repayment Date, at the Stated Maturity
or by declaration of acceleration, call for redemption or otherwise.
"NYSE" shall mean the New York Stock Exchange,
Inc.
"Officers' Certificate" means a certificate signed by the
Chairman of the Board, the Chief Executive Officer, a Co-Chief Operating Officer
or a Vice President, and by the Treasurer, an Assistant Treasurer, the
Controller, an Assistant Controller, the Secretary or an Assistant Secretary
of the Company, and delivered to the Trustee. Wherever this Indenture requires
that an Officers' Certificate be signed also by an engineer or an accountant
or other expert, such engineer, accountant or other expert (except as otherwise
expressly provided in this Indenture) may be in the employ of the Company, and
shall be acceptable to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who
may (except as otherwise expressly provided in this Indenture) be an employee of
or of counsel to the Company, which is delivered to the Trustee. Such counsel
8
shall be acceptable to the Trustee, whose acceptance shall not be unreasonably
withheld.
"Original Issue Discount Security" means (i) any Security
which provides for an amount less than the principal amount thereof to be due
and payable upon a declaration of acceleration of the Maturity thereof, and (ii)
any other security which is issued with "original issue discount" within the
meaning of Section 1273(a) of the Internal Revenue Code of 1986, as amended, and
the regulations thereunder.
"Outstanding", when used with respect to Securities or
Securities of any series, means, as of the date of determination, all such
Securities theretofore authenticated and delivered under this Indenture, except:
(i) such Securities theretofore canceled by the
Trustee or delivered to the Trustee for cancelation;
(ii) such Securities for whose payment or redemption money in
the necessary amount has been theretofore deposited with the Trustee or
any Paying Agent in trust for the Holders of such Securities; provided
that, if such Securities are to be redeemed, notice of such redemption
has been duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made; and
(iii) such Securities in exchange for or in lieu of which
other Securities have been authenticated and delivered pursuant to this
Indenture, or which shall have been paid pursuant to the terms of
Section 3.06 (except with respect to any such Security as to which
proof satisfactory to the Trustee is presented that such Security is
held by a Person in whose hands such Security is a legal, valid and
binding obligation of the Company).
In determining whether the Holders of the requisite principal amount of such
Securities Outstanding have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, (i) the principal amount of any Original
Issue Discount Security that shall be deemed to be Outstanding shall be the
amount of the principal thereof that would be due and payable as of the date of
the taking of such action upon a declaration of acceleration of the Maturity
thereof, and (ii) Securities owned by the Company or any other obligor upon the
Securities or any Affiliate of the Company or of such other obligor shall be
disregarded and deemed not to be Outstanding. In determining whether
9
the Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Securities which a
Responsible Officer assigned to the Corporate Trust Department of the Trustee
knows to be owned by the Company or any other obligor upon the Securities or any
Affiliate of the Company or such other obligor shall be so disregarded.
Securities so owned which have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right to act as owner with respect to such Securities and that the
pledgee is not the Company or any other obligor upon the Securities or any
Affiliate of the Company or such other obligor.
"Paying Agent" means any Person authorized by the Company to
pay the principal of (and premium, if any) or interest on any Securities on
behalf of the Company. The Company initially authorizes the Trustee to act as
Paying Agent for the Securities on its behalf. The Company may at any time and
from time to time authorize one or more Persons to act as Paying Agent in
addition to or in place of the Trustee with respect to any series of Securities
issued under this Indenture.
"Person" means any individual, corporation, limited liability
company, partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Place of Payment" means with respect to any series of
Securities issued hereunder the city or political subdivision so designated with
respect to the series of Securities in question in accordance with the
provisions of Section 3.01.
"Predecessor Securities" of any particular Security means
every previous Security evidencing all or a portion of the same debt as that
evidenced by such particular Security; and, for the purposes of this definition,
any Security authenticated and delivered under Section 3.06 in lieu of a lost,
destroyed or stolen Security shall be deemed to evidence the same debt as the
lost, destroyed or stolen Security.
"Redemption Date", when used with respect to any Security to
be redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", when used with respect to any
Security to be redeemed, means the price specified in the
10
Security at which it is to be redeemed pursuant to this Indenture.
"Redemption Rescission Event" shall mean the occurrence of (a)
any general suspension of trading in, or limitation on prices for, securities on
the principal national securities exchange on which shares of Common Stock or
Marketable Securities are registered and listed for trading (or, if shares of
Common Stock or Marketable Securities are not registered and listed for trading
on any such exchange, in the over-the-counter market) for more than
six-and-one-half (6-1/2) consecutive trading hours, (b) any decline in either
the Dow ▇▇▇▇▇ Industrial Average or the S&P's Index of 400 Industrial Companies
(or any successor index published by Dow ▇▇▇▇▇ & Company, Inc. or S&P) by either
(i) an amount in excess of 10%, measured from the close of business on any
Trading Day to the close of business on the next succeeding Trading Day during
the period commencing on the Trading Day preceding the day notice of any
redemption of Securities is given (or, if such notice is given after the close
of business on a Trading Day, commencing on such Trading Day) and ending at the
time and date fixed for redemption in such notice or (ii) an amount in excess of
15% (or if the time and date fixed for redemption is more than 15 days following
the date on which such notice of redemption is given, 20%), measured from the
close of business on the Trading Day preceding the day notice of such redemption
is given (or, if such notice is given after the close of business on a Trading
Day, from such Trading Day) to the close of business on any Trading Day at or
prior-to the time and date fixed for redemption, (c) a declaration of a banking
moratorium or any suspension of payments in respect of banks by Federal or state
authorities in the United States or (d) the commencement of a war or armed
hostilities or other national or international calamity directly or indirectly
involving the United States which in the reasonable judgment of the Company
could have a material adverse effect on the market for the Common Stock or
Marketable Securities.
"Regular Record Date" for the interest payable on any Security
on any Interest Payment Date means the date specified in such Security as the
Regular Record Date.
"Repayment Date", when used with respect to any Security to be
repaid, means the date fixed for such repayment pursuant to such Security.
"Repayment Price", when used with respect to any Security to
be repaid, means the price at which it is to be repaid pursuant to such
Security.
11
"Required Currency", when used with respect to any Security,
has the meaning set forth in Section 1.14.
"Responsible Officer", when used with respect to the Trustee,
means any officer of the Trustee with direct responsibility for the
administration of this Indenture 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.
"S&P" means Standard & Poor's Ratings Service or any successor
to the rating agency business thereof.
"Security" or "Securities" means any note or notes, bond or
bonds, debenture or debentures, or any other evidences of indebtedness, as the
case may be, of any series authenticated and delivered from time to time under
this Indenture.
"Security Register" shall have the meaning specified in
Section 3.05.
"Security Registrar" means the Person who keeps the Security
Register specified in Section 3.05. The Company initially appoints the Trustee
to act as Security Registrar for the Securities on its behalf. The Company may
at any time and from time to time authorize any Person to act as Security
Registrar in place of the Trustee with respect to any series of Securities
issued under this Indenture.
"Securityholder" means a Person in whose name a security is
registered in the Security Register.
"Special Record Date" for the payment of any Defaulted
Interest means a date fixed by the Trustee pursuant to Section 3.07.
"Stated Maturity" when used with respect to any Security or
any installment of principal thereof or interest thereon means the date
specified in such Security as the fixed date on which the principal of such
Security or such installment of principal or interest is due and payable.
"Subsidiary" means, with respect to any Person, any
corporation more than 50% of the voting stock of which is owned directly or
indirectly by such Person, and any partnership, association, joint venture or
other entity in which such Person owns more than 50% of the equity interests
12
or has the power to elect a majority of the board of directors or other
governing body.
"TBS" means ▇▇▇▇▇▇ Broadcasting System, Inc., a Georgia
corporation and wholly owned subsidiary of Time Warner, until a successor shall
have become such pursuant to the applicable provisions of this Indenture, and
thereafter "TBS" shall mean such successor.
"Time Warner" means Time Warner Inc., a Delaware corporation
and wholly owned subsidiary of the Company, until a successor shall have been
such pursuant to the applicable provisions of this Indenture, and thereafter
"Time Warner" shall mean such successor.
"Trading Day" shall mean, with respect to the Common Stock or
a Marketable Security, so long as the common stock or such Marketable Security,
as the case may be, is listed or admitted to trading on the NYSE, a day on which
the NYSE is open for the transaction of business, or, if the Common Stock or
such Marketable Security, as the case may be, is not listed or admitted to
trading on the NYSE, a day on which the principal national securities exchange
on which the Common Stock or such Marketable Security, as the case may be, is
listed is open for the transaction of business, or, if the Common Stock or such
Marketable Security, as the case may be, is not so listed or admitted for
trading on any national securities exchange, a day on which NASDAQ is open for
the transaction of business.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act
of 1939 as in force at the date as of which this instrument was executed;
provided, however, that, in the event the Trust Indenture Act of 1939 is amended
after such date, "Trust Indenture Act" or "TIA" means, to the extent required by
any such amendment, the Trust Indenture Act of 1939 as so amended.
"Trustee" means the Person named as the Trustee in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean and include each Person who is then a Trustee hereunder. If
at any time there is more than one such Person, "Trustee" as used with respect
to the Securities of any series shall mean the Trustee with respect to
Securities of that series.
"TWC" means Time Warner Companies, Inc., a Delaware
corporation and wholly owned subsidiary of Time Warner, until a successor shall
have become such pursuant to
13
the applicable provisions of this Indenture, and thereafter "TWC" shall mean
such successor.
"TWE" means Time Warner Entertainment Company, L.P., a
Delaware limited partnership and subsidiary of TWC.
"Vice President" when used with respect to the Company or the
Trustee means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president", including,
without limitation, an assistant vice president.
"Voting Stock", as applied to the stock of any corporation,
means stock of any class or classes (however designated) having by the terms
thereof ordinary voting power to elect a majority of the members of the board of
directors (or other governing body) of such corporation other than stock having
such power only by reason of the happening of a contingency.
"Works" means motion pictures, video, television, interactive
or multi-media programming, audio-visual works, sound recordings, books and
other literary or written material, any software, copyright or other
intellectual property related thereto, acquired directly or indirectly after the
date of this Indenture by purchase, business combination, production, creation
or otherwise, any component of the foregoing or rights with respect thereto, and
all improvements thereon, products and proceeds thereof and revenues derived
therefrom.
"Yield to Maturity" means the yield to maturity on a series of
Securities, calculated by the Company at the time of issuance of such series of
Securities, or, if applicable, at the most recent redetermination of interest on
such series, in accordance with accepted financial practice.
SECTION 1.02. Compliance Certificates and Opinions. Upon any
application or request by the Company to the Trustee to take any action under
any provision of this Indenture, the Company shall furnish to the Trustee an
Officers' Certificate stating that all conditions precedent, if any (including
any covenants compliance with which constitutes a condition precedent), provided
for in this Indenture relating to the proposed action have been complied with
and an Opinion of Counsel stating that in the opinion of such Counsel all such
conditions precedent, if any (including any covenants compliance with which
constitutes a condition precedent), have been complied with, except that in the
case of any such application or request as to which
14
the furnishing of such documents is specifically required by any provision of
this Indenture relating to such particular application or request, no additional
certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than annual
statements of compliance provided pursuant to Section 10.04) shall include:
(1) a statement that each individual signing such certificate
or opinion has read such covenant or condition and the definitions
herein relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such individual,
he has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
SECTION 1.03. Form of Documents Delivered to Trustee. In any
case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons may certify or give an opinion as to the other matters, and any such
Person may certify or give an opinion as to such matters in one or several
documents.
Any certificate or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an
15
officer or officers of the Company stating that the information with respect to
such factual matters is in the possession of the Company, unless such Counsel
knows, or in the exercise of reasonable care should know, that the certificate
or opinion or representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
SECTION 1.04. Acts of Securityholders. (a) Any request,
demand, authorization, direction, notice, consent, waiver or other action
provided by this Indenture to be given or taken by Securityholders or
Securityholders of any series may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Securityholders in
person or by an agent duly appointed in writing or may be embodied in or
evidenced by an electronic transmission which identifies the documents
containing the proposal on which such consent is requested and certifies such
Securityholders' consent thereto and agreement to be bound thereby; and, except
as herein otherwise expressly provided, such action shall become effective when
such instrument or instruments are delivered to the Trustee, and, where it is
hereby expressly required, to the Company. If any Securities are denominated in
coin or currency other than that of the United States, then for the purposes of
determining whether the Holders of the requisite principal amount of Securities
have taken any action as herein described, the principal amount of such
Securities shall be deemed to be that amount of United States dollars that could
be obtained for such principal amount on the basis of the spot rate of exchange
into United States dollars for the currency in which such Securities are
denominated (as evidenced to the Trustee by an Officers' Certificate) as of the
date the taking of such action by the Holders of such requisite principal amount
is evidenced to the Trustee as provided in the immediately preceding sentence.
If any Securities are Original Issue Discount Securities, then for the purposes
of determining whether the Holders of the requisite principal amount of
Securities have taken any action as herein described, the principal amount of
such Original Issue Discount Securities shall be deemed to be the amount of the
principal thereof that would be due and payable upon a declaration of
acceleration of the Maturity thereof as of the date the taking of such action by
the Holders of such requisite principal amount is evidenced to the Trustee as
provided in the first sentence of this
16
Section 1.04(a). Such instrument or instruments (and the action embodied therein
and evidenced thereby) are herein sometimes referred to as the "Act" of the
Securityholders signing such instrument or instruments. Proof of execution of
any such instrument or of a writing appointing any such agent shall be
sufficient for any purpose of this Indenture and (subject to Section 6.01)
conclusive in favor of the Trustee and the Company, if made in the manner
provided in this Section.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved by the affidavit of a witness to such
execution or by the certificate of any notary public or other officer authorized
by law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by an officer of a corporation or a member of a partnership, on
behalf of such corporation or partnership, such certificate or affidavit shall
also constitute sufficient proof of his authority. The fact and date of the
execution of any such instrument or writing, or the authority of the person
executing the same, may also be proved in any other manner which the Trustee
deems sufficient.
(c) The ownership of Securities shall be proved
by the Security Register.
(d) If the Company shall solicit from the Holders any request,
demand, authorization, direction, notice, consent, waiver or other action, the
Company may, at its option, by Board Resolution, fix in advance a record date
for the determination of Holders entitled to give such request, demand,
authorization, direction, notice, consent, waiver or other action, but the
Company shall have no obligation to do so. Such record date shall be the later
of 10 days prior to the first solicitation of such action or the date of the
most recent list of Holders furnished to the Trustee pursuant to Section 7.01.
If such a record date is fixed, such request, demand, authorization, direction,
notice, consent, waiver or other action may be given before or after the record
date, but only the Holders of record at the close of business on the record date
shall be deemed to be Holders for the purposes of determining whether Holders of
the requisite proportion of Securities outstanding have authorized or agreed or
consented to such request, demand, authorization, direction, notice, consent,
waiver or other action, and for that purpose the Securities outstanding shall be
computed as of the record date; provided that no such authorization, agreement
or consent by the Holders on the record date shall be deemed effective unless it
shall
17
become effective pursuant to the provisions of this Indenture not later than six
months after the record date, and that no such authorization, agreement or
consent may be amended, withdrawn or revoked once given by a Holder, unless the
Company shall provide for such amendment, withdrawal or revocation in
conjunction with such solicitation of authorizations, agreements or consents or
unless and to the extent required by applicable law.
(e) Any request, demand, authorization, direction, notice,
consent, waiver or other action by the Holder of any Security shall bind the
Holder of every Security issued upon the registration of transfer thereof or in
exchange therefor or in lieu thereof, in respect of anything done or suffered to
be done by the Trustee or the Company in reliance thereon whether or not
notation of such action is made upon such Security.
SECTION 1.05. Notices, etc., to Trustee and Company. Any
request, demand, authorization, direction, notice, consent, waiver or Act of
Securityholders or other document provided or permitted by this Indenture to be
made upon, given or furnished to, or filed with:
(1) the Trustee by any Securityholder or by the
Company shall be sufficient for every purpose hereunder
if made, given, furnished or filed in writing to or
with the Trustee at its Corporate Trust Office,
Attention: Institutional Trust Services; or
(2) the Company by the Trustee or by any Securityholder shall
be sufficient for every purpose hereunder (except as provided in
Section 5.01(4) or, in the case of a request for repayment, as
specified in the Security carrying the right to repayment) if in
writing and mailed, first-class postage prepaid, to the Company
addressed to it at the address of its principal office specified in the
first paragraph of this instrument, Attention: Treasurer, or at any
other address previously furnished in writing to the Trustee by the
Company.
SECTION 1.06. Notices to Securityholders; Waiver. Where this
Indenture or any Security provides for notice to Securityholders of any event,
such notice shall be sufficiently given (unless otherwise herein or in such
Security expressly provided) if in writing and mailed, first-class postage
prepaid, to each Securityholder affected by such event, at his address as it
appears in the Security Register, not later than the latest date, and not
earlier than the earliest date, prescribed for the giving of such
18
notice. In any case where notice to Securityholders is given by mail, neither
the failure to mail such notice, nor any defect in any notice so mailed, to any
particular Securityholder shall affect the sufficiency of such notice with
respect to other Securityholders. Where this Indenture or any Security provides
for notice in any manner, such notice may be waived in writing by the Person
entitled to receive such notice, either before or after the event, and such
waiver shall be the equivalent of such notice. Waivers of notice by
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.
In case, by reason of the suspension of regular mail service
as a result of a strike, work stoppage or otherwise, it shall be impractical to
mail notice of any event to any Securityholder when such notice is required to
be given pursuant to any provision of this Indenture, then any method of
notification as shall be satisfactory to the Trustee and the Company shall be
deemed to be a sufficient giving of such notice.
SECTION 1.07. Conflict with Trust Indenture Act. If and to the
extent that any provision hereof limits, qualifies or conflicts with the duties
imposed by, or with another provision (an "incorporated provision") included in
this Indenture by operation of, any of Sections 310 to 318, inclusive, of the
Trust Indenture Act, such imposed duties or incorporated provision shall
control.
SECTION 1.08. Effect of Headings and Table of Contents. The
Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
SECTION 1.09. Successors and Assigns. All covenants and
agreements in this Indenture by the Company and the Guarantors shall bind their
respective successors and assigns, whether so expressed or not.
SECTION 1.10. Separability Clause. In case any provision in
this Indenture or in the Securities shall be invalid, illegal or unenforceable,
the validity, legality and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby.
SECTION 1.11. Benefits of Indenture. Nothing in this Indenture
or in any Securities, express or implied, shall give to any Person, other than
the parties hereto and their successors hereunder, any Authenticating Agent or
19
Paying Agent, the Security Registrar and the Holders of Securities (or such of
them as may be affected thereby), any benefit or any legal or equitable right,
remedy or claim under this Indenture.
SECTION 1.12. Governing Law. This Indenture shall be construed
in accordance with and governed by the laws of the State of New York.
SECTION 1.13. Counterparts. This instrument may be executed in
any number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument.
SECTION 1.14. Judgment Currency. The Company agrees, to the
fullest extent that it may effectively do so under applicable law, that (a) if
for the purpose of obtaining judgment in any court it is necessary to convert
the sum due in respect of the principal of, or premium or interest, if any, on
the Securities of any series (the "Required Currency") into a currency in which
a judgment will be rendered (the "Judgment Currency"), the rate of exchange used
shall be the rate at which in accordance with normal banking procedures the
Trustee could purchase in the City of New York the Required Currency with the
Judgment Currency on the New York Banking Day preceding that on which a final
unappealable judgment is given and (b) its obligations under this Indenture to
make payments in the Required Currency (i) shall not be discharged or satisfied
by any tender, or any recovery pursuant to any judgment (whether or not entered
in accordance with subsection (a)), in any currency other than the Required
Currency, except to the extent that such tender or recovery shall result in the
actual receipt, by the payee, of the full amount of the Required Currency
expressed to be payable in respect of such payments, (ii) shall be enforceable
as an alternative or additional cause of action for the purpose of recovering in
the Required Currency the amount, if any, by which such actual receipt shall
fall short of the full amount of the Required Currency so expressed to be
payable and (iii) shall not be affected by judgment being obtained for any other
sum due under this Indenture. For purposes of the foregoing, "New York Banking
Day" means any day except a Saturday, Sunday or a legal holiday in the City of
New York or a day on which banking institutions in the City of New York are
authorized or required by law or executive order to close.
20
ARTICLE II
Security Forms
SECTION 2.01. Forms Generally. The Securities shall have such
appropriate insertions, omissions, substitutions and other variations as are
required or permitted by this Indenture and may have such letters, numbers or
other marks of identification and such legends or endorsements placed thereon,
as may be required to comply with the rules of any securities exchange, or as
may, consistently herewith, be determined by the officers executing such
Securities, as evidenced by their execution of the Securities. Any portion of
the text of any Security may be set forth on the reverse thereof, with an
appropriate reference thereto on the face of the Security.
The definitive Securities shall be printed, lithographed or
engraved or produced by any combination of these methods on steel engraved
borders or may be produced in any other manner, all as determined by the
officers executing such Securities, as evidenced by their execution of such
Securities, subject, with respect to the Securities of any series, to the rules
of any securities exchange on which such Securities are listed.
SECTION 2.02. Forms of Securities. Each Security shall be in
one of the forms approved from time to time by or pursuant to a Board
Resolution, or established in one or more indentures supplemental hereto. Prior
to the delivery of a Security to the Trustee for authentication in any form
approved by or pursuant to a Board Resolution, the Company shall deliver to the
Trustee the Board Resolution by or pursuant to which such form of Security has
been approved, which Board Resolution shall have attached thereto a true and
correct copy of the form of Security which has been approved thereby or, if a
Board Resolution authorizes a specific officer or officers to approve a form of
Security, a certificate of such officer or officers approving the form of
Security attached thereto. Any form of Security approved by or pursuant to a
Board Resolution must be acceptable as to form to the Trustee, such acceptance
to be evidenced by the Trustee's authentication of Securities in that form or a
certificate signed by a Responsible Officer of the Trustee and delivered to the
Company.
SECTION 2.03. Form of Trustee's Certificate of Authentication.
The form of Trustee's Certificate of
21
Authentication for any Security issued pursuant to this Indenture shall be
substantially as follows:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
THE CHASE MANHATTAN BANK, as
Trustee
by
-------------------------
Authorized Officer
SECTION 2.04. Securities Issuable in the Form of a Global
Security. (a) If the Company shall establish pursuant to Sections 2.02 and 3.01
that the Securities of a particular series are to be issued in whole or in part
in the form of one or more Global Securities, then the Company shall execute and
the Trustee or its agent shall, in accordance with Section 3.03 and the Company
Order delivered to the Trustee or its agent thereunder, authenticate and
deliver, such Global Security or Securities, which (i) shall represent, and
shall be denominated in an amount equal to the aggregate principal amount of,
the Outstanding Securities of such series to be represented by such Global
Security or Securities, or such portion thereof as the Company shall specify in
a Company Order, (ii) shall be registered in the name of the Depository for such
Global Security or Securities or its nominee, (iii) shall be delivered by the
Trustee or its agent to the Depository or pursuant to the Depository's
instruction and (iv) shall bear a legend substantially to the following effect:
"Unless this certificate is presented by an authorized representative of the
Depository to Issuer or its agent for registration of transfer, exchange, or
payment, and any certificate issued is registered in the name of the nominee of
the Depository or in such other name as is requested by an authorized
representative of the Depository (and any payment is made to the nominee of the
Depository or to such other entity as is requested by an authorized
representative of the Depository), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered
owner hereof, the nominee of the Depository, has an interest herein."
(b) Notwithstanding any other provision of this
Section 2.04 or of Section 3.05, and subject to the
22
provisions of paragraph (c) below, unless the terms of a Global Security
expressly permit such Global Security to be exchanged in whole or in part for
individual Securities, a Global Security may be transferred, in whole but not in
part and in the manner provided in Section 3.05, only to a nominee of the
Depository for such Global Security, or to the Depository, or a successor
Depository for such Global Security selected or approved by the Company, or to a
nominee of such successor Depository.
(c) (i) If at any time the Depository for a Global Security
notifies the Company that it is unwilling or unable to continue as Depository
for such Global Security or if at any time the Depository for the Securities for
such series shall no longer be eligible or in good standing under the Securities
Exchange Act of 1934, as amended, or other applicable statute or regulation, the
Company shall appoint a successor Depository with respect to such Global
Security. If a successor Depository for such Global Security is not appointed by
the Company within 90 days after the Company receives such notice or becomes
aware of such ineligibility, the Company will execute, and the Trustee or its
agent, upon receipt of a Company Request for the authentication and delivery of
individual Securities of such series in exchange for such Global Security, will
authenticate and deliver, individual Securities of such series of like tenor and
terms in an aggregate principal amount equal to the principal amount of the
Global Security in exchange for such Global Security.
(ii) The Company may at any time and in its sole discretion
determine that the Securities of any series or portion thereof issued or
issuable in the form of one or more Global Securities shall no longer be
represented by such Global Security or Securities. In such event the Company
will execute, and the Trustee, upon receipt of a Company Request for the
authentication and delivery of individual Securities of such series in exchange
in whole or in part for such Global Security, will authenticate and deliver
individual Securities of such series of like tenor and terms in definitive form
in an aggregate principal amount equal to the principal amount of such Global
Security or Securities representing such series or portion thereof in exchange
for such Global Security or Securities.
(iii) If specified by the Company pursuant to Sections 2.02
and 3.02 with respect to Securities issued or issuable in the form of a Global
Security, the Depository for such Global Security may surrender such Global
Security in exchange in whole or in part for individual Securities of such
series of like tenor and terms in definitive form on
23
such terms as are acceptable to the Company and such Depository. Thereupon the
Company shall execute, and the Trustee or its agent shall authenticate and
deliver, without service charge, (1) to each Person specified by such Depository
a new Security or Securities of the same series of like tenor and terms and of
any authorized denomination as requested by such Person in aggregate principal
amount equal to and in exchange for such Person's beneficial interest as
specified by such Depository in the Global Security; and (2) to such Depository
a new Global Security of like tenor and terms and in an authorized denomination
equal to the difference, if any, between the principal amount of the surrendered
Global Security and the aggregate principal amount of Securities delivered to
Holders thereof.
(iv) In any exchange provided for in any of the preceding
three paragraphs, the Company will execute and the Trustee or its agent will
authenticate and deliver individual Securities in definitive registered form in
authorized denominations. Upon the exchange of the entire principal amount of a
Global Security for individual Securities, such Global Security shall be
canceled by the Trustee or its agent. Except as provided in the preceding
paragraph, Securities issued in exchange for a Global Security pursuant to this
Section shall be registered in such names and in such authorized denominations
as the Depository for such Global Security, pursuant to instructions from its
direct or indirect participants or otherwise, shall instruct the Trustee or the
Security Registrar. The Trustee or the Security Registrar shall deliver at its
Corporate Trust Office such Securities to the Persons in whose names such
Securities are so registered.
ARTICLE III
The Securities
SECTION 3.01. General Title; General Limitations; Issuable in
Series; Terms of Particular Series. The aggregate principal amount of Securities
which may be authenticated and delivered and Outstanding under this Indenture is
not limited.
The Securities may be issued in one or more series as from
time to time may be authorized by the Board of Directors. There shall be
established in or pursuant to a Board Resolution or in a supplemental indenture,
subject to
24
Section 3.11, prior to the issuance of Securities of any such series:
(1) the title of the Securities of such series (which shall
distinguish the Securities of such series from Securities of any other
series);
(2) the Person to whom any interest on a Security of such
series shall be payable, if other than the Person in whose name that
Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest;
(3) the date or dates on which the principal of
the Securities of such series is payable;
(4) the rate or rates at which the Securities of such series
shall bear interest, if any, the date or dates from which such interest
shall accrue, the Interest Payment Dates on which any such interest
shall be payable and the Regular Record Date for any interest payable
on any Interest Payment Date;
(5) the place or places where the principal of and
any premium and interest on Securities of such series
shall be payable;
(6) the period or periods within which, the Redemption Price
or Prices or the Repayment Price or Prices, as the case may be, at
which and the terms and conditions upon which Securities of such series
may be redeemed or repaid (including the applicability of Section
11.09), as the case may be, in whole or in part, at the option of the
Company or the Holder;
(7) the obligation, if any, of the Company to purchase
Securities of such series pursuant to any sinking fund or analogous
provisions or at the option of a Holder thereof and the period or
periods within which, the price or prices at which and the terms and
conditions upon which Securities of such series shall be purchased, in
whole or in part, pursuant to such obligation;
(8) if other than denominations of $1,000 and any integral
multiple thereof, the denominations in which Securities of such series
shall be issuable;
(9) provisions, if any, with regard to the conversion or
exchange of the Securities of such series, at the option of the
Holders thereof or the
25
Company, as the case may be, for or into new Securities of a different
series, Common Stock or other securities and, if the Securities of such
series are convertible into common stock or other Marketable
Securities, the Conversion Price therefor;
(10) if other than U.S. dollars, the currency or currencies or
units based on or related to currencies in which the Securities of such
series shall be denominated and in which payments of principal of, and
any premium and interest on, such Securities shall or may be payable;
(11) if the principal of (and premium, if any) or interest, if
any, on the Securities of such series are to be payable, at the
election of the Company or a Holder thereof, in a coin or currency
(including a composite currency) other than that in which the
Securities are stated to be payable, the period or periods within
which, and the terms and conditions upon which, such election may be
made;
(12) if the amount of payments of principal of (and premium,
if any) or interest, if any, on the Securities of such series may be
determined with reference to an index based on a coin or currency
(including a composite currency) other than that in which the
Securities are stated to be payable, the manner in which such amounts
shall be determined;
(13) any limit upon the aggregate principal amount of the
Securities of such series which may be authenticated and delivered
under this Indenture (except for Securities authenticated and delivered
upon registration of transfer of, or in exchange for, or in lieu of,
other Securities of such series pursuant to Section 3.04, 3.05, 3.06,
9.06, 11.07 and 12.02 and except for any Securities which, pursuant to
Section 3.03, are deemed never to have been authenticated and delivered
hereunder);
(14) provisions, if any, with regard to the exchange of
Securities of such series, at the option of the Holders thereof, for
other Securities of the same series of the same aggregate principal
amount or of a different authorized series or different authorized
denomination or denominations, or both;
(15) provisions, if any, with regard to the appointment by the
Company of an Authenticating Agent in one or more places other than the
location of the
26
office of the Trustee with power to act on behalf of the Trustee and
subject to its direction in the authentication and delivery of the
Securities of any one or more series in connection with such
transactions as shall be specified in the provisions of this Indenture
or in or pursuant to such Board Resolution or supplemental indenture;
(16) the portion of the principal amount of Securities of the
series, if other than the principal amount thereof, which shall be
payable upon declaration of acceleration of the Maturity thereof
pursuant to Section 5.02 or provable in bankruptcy pursuant to Section
5.04;
(17) any Event of Default with respect to the Securities of
such series, if not set forth herein, and any additions, deletions or
other changes to the Events of Default set forth herein that shall be
applicable to the Securities of such series;
(18) any covenant solely for the benefit of the Securities of
such series and any additions, deletions or other changes to the
provisions of Article X or Section 1.01 or any definitions relating to
such Article that would otherwise be applicable to the Securities of
such series;
(19) if Section 4.03 of this Indenture shall not be applicable
to the Securities of such series and if Section 4.03 shall be
applicable to any covenant or Event of Default established in or
pursuant to a Board Resolution or in a supplemental indenture as
described above that has not already been established herein;
(20) if the Securities of such series shall be issued in whole
or in part in the form of a Global Security or Securities, the terms
and conditions, if any, upon which such Global Security or Securities
may be exchanged in whole or in part for other individual Securities;
and the Depository for such Global Security or Securities; and
(21) any other terms of such series.
all upon such terms as may be determined in or pursuant to such Board Resolution
or supplemental indenture with respect to such series.
The form of the Securities of each series shall be
established pursuant to the provisions of this Indenture in
27
or pursuant to the Board Resolution or in the supplemental indenture creating
such series. The Securities of each series shall be distinguished from the
Securities of each other series in such manner, reasonably satisfactory to the
Trustee, as the Board of Directors may determine.
Unless otherwise provided with respect to Securities of a
particular series, the Securities of any series may only be issuable in
registered form, without coupons.
Any terms or provisions in respect of the Securities of any
series issued under this Indenture may be determined pursuant to this Section by
providing for the method by which such terms or provisions shall be determined.
SECTION 3.02. Denominations. The Securities of each series
shall be issuable in such denominations and currency as shall be provided in the
provisions of this Indenture or in or pursuant to the Board Resolution or the
supplemental indenture creating such series. In the absence of any such
provisions with respect to the Securities of any series, the Securities of that
series shall be issuable only in fully registered form in denominations of
$1,000 and any integral multiple thereof.
SECTION 3.03. Execution, Authentication and Delivery and
Dating. The Securities shall be executed on behalf of the Company by its
Chairman of the Board, its Chief Executive Officer, one of its Co-Chief
Operating Officers, one of its Vice Presidents or its Treasurer under its
corporate seal reproduced thereon and attested by its Secretary or one of its
Assistant Secretaries. The signature of any of these officers on the Securities
may be manual or facsimile.
Securities bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind
the Company, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Securities or
did not hold such offices at the date of such Securities.
At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities executed by the
Company to the Trustee for authentication; and the Trustee shall, upon Company
Order, authenticate and deliver such Securities as in this Indenture provided
and not otherwise.
28
Prior to any such authentication and delivery, the Trustee
shall be entitled to receive, in addition to any Officers' Certificate and
Opinion of Counsel required to be furnished to the Trustee pursuant to Section
1.02, and the Board Resolution and any certificate relating to the issuance of
the series of Securities required to be furnished pursuant to Section 2.02, an
Opinion of Counsel stating that:
(1) all instruments furnished to the Trustee conform to the
requirements of the Indenture and constitute sufficient authority
hereunder for the Trustee to authenticate and deliver such Securities;
(2) the form and terms of such Securities have been
established in conformity with the provisions of this Indenture;
(3) all laws and requirements with respect to the execution
and delivery by the Company of such Securities have been complied with,
the Company has the corporate power to issue such Securities and such
Securities have been duly authorized and delivered by the Company and,
assuming due authentication and delivery by the Trustee, constitute
legal, valid and binding obligations of the Company enforceable in
accordance with their terms (subject, as to enforcement of remedies, to
applicable bankruptcy, reorganization, insolvency, moratorium or other
laws and legal principles affecting creditors' rights generally from
time to time in effect and to general equitable principles, whether
applied in an action at law or in equity) and entitled to the benefits
of this Indenture, equally and ratably with all other Securities, if
any, of such series Outstanding;
(4) the Indenture is qualified under the Trust Indenture
Act; and
(5) such other matters as the Trustee may reasonably request;
and, if the authentication and delivery relates to a new series of Securities
created by an indenture supplemental hereto, also stating that all laws and
requirements with respect to the form and execution by the Company of the
supplemental indenture with respect to that series of Securities have been
complied with, the Company has corporate power to execute and deliver any such
supplemental indenture and has taken all necessary corporate action for those
purposes and any such supplemental indenture has been
29
executed and delivered and constitutes the legal, valid and binding obligation
of the Company enforceable in accordance with its terms (subject, as to
enforcement of remedies, to applicable bankruptcy, reorganization, insolvency,
moratorium or other laws and legal principles affecting creditors' rights
generally from time to time in effect and to general equitable principles,
whether applied in an action at law or in equity).
The Trustee shall not be required to authenticate such
Securities if the issue thereof will adversely affect the Trustee's own rights,
duties or immunities under the Securities and this Indenture.
Unless otherwise provided in the form of Security for any
series, all Securities shall be dated the date of their authentication.
No Security shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there appears on such
Security a certificate of authentication substantially in the form provided for
herein executed by the Trustee by manual signature, and such certificate upon
any Security shall be conclusive evidence, and the only evidence, that such
Security has been duly authenticated and delivered hereunder. Notwithstanding
the foregoing, if any Security shall have been authenticated and delivered
hereunder but never issued and sold by the Company, and the Company shall
deliver such Security to the Trustee for cancelation as provided in Section
3.09, for all purposes of this Indenture such Security shall be deemed never to
have been authenticated and delivered hereunder and shall never be entitled to
the benefits of this Indenture.
SECTION 3.04. Temporary Securities. Pending the preparation of
definitive Securities of any series, the Company may execute, and, upon receipt
of the documents required by Section 3.03, together with a Company Order, the
Trustee shall authenticate and deliver, temporary Securities which are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any authorized
denomination, substantially of the tenor of the definitive Securities in lieu of
which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Securities may
determine, as evidenced by their execution of such Securities.
If temporary Securities of any series are issued, the Company
will cause definitive Securities of such series to be prepared without
unreasonable delay. After the preparation of definitive Securities, the
temporary
30
Securities of such series shall be exchangeable for definitive Securities of
such series upon surrender of the temporary Securities of such series at the
office or agency of the Company in a Place of Payment, without charge to the
Holder; and upon surrender for cancelation of any one or more temporary
Securities the Company shall execute and the Trustee shall authenticate and
deliver in exchange therefor a like principal amount of definitive Securities of
such series of authorized denominations and of like tenor and terms. Until so
exchanged the temporary Securities of such series shall in all respects be
entitled to the same benefits under this Indenture as definitive Securities of
such series.
SECTION 3.05. Registration, Transfer and Exchange. The Company
shall keep or cause to be kept a register or registers (herein sometimes
referred to as the "Security Register") in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for the registration
of Securities, or of Securities of a particular series, and of transfers of
Securities or of Securities of such series. Any such register shall be in
written form or in any other form capable of being converted into written form
within a reasonable time. At all reasonable times the information contained in
such register or registers shall be available for inspection by the Trustee at
the office or agency to be maintained by the Company as provided in Section
10.02. There shall be only one Security Register per series of Securities.
Subject to Section 2.04, upon surrender for registration of
transfer of any Security of any series at the office or agency of the Company
maintained for such purpose in a Place of Payment, the Company shall execute,
and the Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Securities of such series of any
authorized denominations, of a like aggregate principal amount and Stated
Maturity and of like tenor and terms.
Subject to Section 2.04, at the option of the Holder,
Securities of any series may be exchanged for other Securities of such series of
any authorized denominations, of a like aggregate principal amount and Stated
Maturity and of like tenor and terms, upon surrender of the Securities to be
exchanged at such office or agency. Whenever any Securities are so surrendered
for exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Securities which the Securityholder making the exchange is entitled
to receive.
31
All Securities issued upon any registration of transfer or
exchange of Securities shall be the valid obligations of the Company, evidencing
the same debt, and entitled to the same benefits under this Indenture, as the
Securities surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration of
transfer or exchange shall (if so required by the Company or the Trustee) be
duly endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Trustee duly executed, by the Holder thereof
or his attorney duly authorized in writing.
Unless otherwise provided in the Security to be registered for
transfer or exchanged, no service charge shall be made on any Securityholder for
any registration of transfer or exchange of Securities, but the Company may
(unless otherwise provided in such Security) require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Securities, other than
exchanges pursuant to Section 3.04, 9.06 or 11.07 not involving any transfer.
The Company shall not be required (i) to issue, register the
transfer of or exchange any Security of any series during a period beginning at
the opening of business 15 days before the day of the mailing of a notice of
redemption of Securities of such series selected for redemption under Section
11.03 and ending at the close of business on the date of such mailing, or (ii)
to register the transfer of or exchange any Security so selected for redemption
in whole or in part.
None of the Company, the Trustee, any agent of 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 3.06. Mutilated, Destroyed, Lost and Stolen
Securities. If (i) any mutilated Security is surrendered to the Trustee, or the
Company and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Security, and (ii) there is delivered to the
Company and the Trustee such Security or indemnity as may be required by them to
save each of them harmless, then,
32
in the absence of notice to the Company or the Trustee that such Security has
been acquired by a protected purchaser, the Company shall execute and upon its
written request the Trustee shall authenticate and deliver, in exchange for or
in lieu of any such mutilated, destroyed, lost or stolen Security, a new
Security of like tenor, series, Stated Maturity and principal amount, bearing a
number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security
has become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security issued pursuant to this Section in lieu of
any destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities of the same series duly issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities.
SECTION 3.07. Payment of Interest; Interest Rights Preserved.
Unless otherwise provided with respect to such Security pursuant to Section
3.01, interest on any Security which is payable, and is punctually paid or duly
provided for, on any Interest Payment Date shall be paid to the Person in whose
name that Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest.
Any interest on any Security which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the
registered Holder on the relevant Regular Record Date by virtue of his having
been such Holder; and, except as hereinafter provided, such Defaulted Interest
may be paid by the Company, at its
33
election in each case, as provided in Clause (1) or Clause (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names any such Securities (or their
respective Predecessor Securities) are registered at the close of
business on a Special Record Date for the payment of such Defaulted
Interest, which shall be fixed in the following manner. The Company
shall notify the Trustee in writing of the amount of Defaulted Interest
proposed to be paid on each such Security and the date of the proposed
payment, and at the same time the Company shall deposit with the
Trustee an amount of money equal to the aggregate amount proposed to be
paid in respect of such Defaulted Interest or shall make arrangements
satisfactory to the Trustee for such deposit prior to the date of the
proposed payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in this
Clause provided. Thereupon the Trustee shall fix a Special Record Date
for the payment of such Defaulted Interest which shall be not more than
15 nor less than 10 days prior to the date of the proposed payment and
not less than 10 days after the receipt by the Trustee of the notice of
the proposed payment. The Trustee shall promptly notify the Company of
such Special Record Date and, in the name and at the expense of the
Company, shall cause notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor to be mailed, first class
postage prepaid, to the Holder of each such Security at his address as
it appears in the Security Register, not less than 10 days prior to
such Special Record Date. Notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor having been
mailed as aforesaid, such Defaulted Interest shall be paid to the
Persons in whose names such Securities (or their respective Predecessor
Securities) are registered on such Special Record Date and shall no
longer be payable pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest in
any other lawful manner not inconsistent with the requirements of any
securities exchange on which such Securities may be listed, and upon
such notice as may be required by such exchange, if, after notice given
by the Company to the Trustee of the proposed payment pursuant to this
Clause, such manner of payment shall be deemed practicable by the
Trustee.
34
If any installment of interest the Stated Maturity of which is
on or prior to the Redemption Date for any Security called for redemption
pursuant to Article XI is not paid or duly provided for on or prior to the
Redemption Date in accordance with the foregoing provisions of this Section,
such interest shall be payable as part of the Redemption Price of such
Securities.
Subject to the foregoing provisions of this Section, each
Security delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Security shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Security.
SECTION 3.08. Persons Deemed Owners. The Company, the Trustee
and any agent of the Company or the Trustee may treat the Person in whose name
any Security is registered as the owner of such Security for the purpose of
receiving payment of principal of (and premium, if any), and (subject to Section
3.07) interest on, such Security and for all other purposes whatsoever, whether
or not such Security be overdue, and neither the Company, the Trustee nor any
agent of the Company or the Trustee shall be affected by notice to the contrary.
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 in a Global Security or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interests.
SECTION 3.09. Cancelation. All Securities surrendered for
payment, conversion, redemption, registration of transfer, exchange or credit
against a sinking fund shall, if surrendered to any Person other than the
Trustee, be delivered to the Trustee and, if not already canceled, shall be
promptly canceled by it. The Company may at any time deliver to the Trustee for
cancelation any Securities previously authenticated and delivered hereunder
which the Company may have acquired in any manner whatsoever, and all Securities
so delivered shall be promptly canceled by the Trustee. No Security shall be
authenticated in lieu of or in exchange for any Securities canceled as provided
in this Section, except as expressly permitted by this Indenture. The Trustee
shall dispose of all canceled Securities in accordance with its standard
procedures and deliver a certificate of such disposition to the Company.
35
SECTION 3.10. Computation of Interest. Unless otherwise
provided as contemplated in Section 3.01, interest on the Securities shall be
calculated on the basis of a 360- day year of twelve 30-day months.
SECTION 3.11. Delayed Issuance of Securities. Notwithstanding
any contrary provision herein, if all Securities of a series are not to be
originally issued at one time, it shall not be necessary for the Company to
deliver to the Trustee an Officers' Certificate, Board Resolution, supplemental
indenture, opinion of counsel or Company Order otherwise required pursuant to
Sections 1.02, 2.02, 3.01 and 3.03 at or prior to the time of authentication of
each Security of such series if such documents are delivered to the Trustee or
its agent at or prior to the authentication upon original issuance of the first
Security of such series to be issued; provided that any subsequent request by
the Company to the Trustee to authenticate Securities of such series upon
original issuance shall constitute a representation and warranty by the Company
that as of the date of such request, the statements made in the Officers'
Certificate or other certificates delivered pursuant to Sections 1.02 and 2.02
shall be true and correct as if made on such date.
A Company Order, Officers' Certificate or Board Resolution or
supplemental indenture delivered by the Company to the Trustee in the
circumstances set forth in the preceding paragraph may provide that Securities
which are the subject thereof will be authenticated and delivered by the Trustee
or its agent on original issue from time to time in the aggregate principal
amount, if any, established for such series pursuant to such procedures
acceptable to the Trustee as may be specified from time to time by Company Order
upon the telephonic, electronic or written order of Persons designated in such
Company Order, Officers' Certificate, supplemental indenture or Board Resolution
(any such telephonic or electronic instructions to be promptly confirmed in
writing by such Persons) and that such Persons are authorized to determine,
consistent with such Company Order, Officers' Certificate, supplemental
indenture or Board Resolution, such terms and conditions of said Securities as
are specified in such Company Order, Officers' Certificate, supplemental
indenture or Board Resolution.
36
ARTICLE IV
Satisfaction and Discharge
SECTION 4.01. Satisfaction and Discharge of Indenture. This
Indenture shall cease to be of further effect with respect to any series of
Securities (except as to any surviving rights of conversion or registration of
transfer or exchange of Securities of such series expressly provided for herein
or in the form of Security for such series), and the Trustee, on receipt of a
Company Request and at the expense of the Company, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture as to
such series, when:
(1) either
(A) all Securities of that series theretofore
authenticated and delivered (other than (i) Securities of such
series which have been destroyed, lost or stolen and which
have been replaced or paid as provided in Section 3.06, and
(ii) Securities of such series for whose payment money in the
Required Currency has theretofore been deposited in trust or
segregated and held in trust by the Company and thereafter
repaid to the Company or discharged from such trust, as
provided in Section 10.03) have been delivered to the Trustee
canceled or for cancelation; or
(B) all such Securities of that series not
theretofore delivered to the Trustee canceled or for
cancelation:
(i) have become due and payable, or
(ii) will become due and payable at
their Stated Maturity within one year, or
(iii) are to be called for redemption within
one year under arrangements satisfactory to the
Trustee for the giving of notice of redemption by the
Trustee in the name, and at the expense, of the
Company,
and the Company, in the case of (i), (ii) or (iii) above, has
irrevocably deposited or caused to be deposited with the Trustee as
trust funds in trust for the purpose an amount in the Required Currency
sufficient to pay and discharge the entire indebtedness on such
Securities not theretofore delivered to the
37
Trustee canceled or for cancelation, for principal (and premium, if
any) and interest to the date of such deposit (in the case of
Securities which have become due and payable), or to the Stated
Maturity or Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all
other sums payable hereunder by the Company with
respect to the Securities of such series; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel each stating that all conditions
precedent herein provided for relating to the satisfaction and
discharge of this Indenture with respect to the Securities of such
series have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture with respect to
any series of Securities, the obligations of the Company to the Trustee with
respect to that series under Section 6.07 shall survive and the obligations of
the Company and the Trustee under Sections 3.05, 3.06, 4.02, 10.02 and 10.03
shall survive.
SECTION 4.02. Application of Trust Money. Subject to the
provisions of the last paragraph of Section 10.03, all money deposited with the
Trustee pursuant to Section 4.01 or Section 4.03 shall be held in trust and
applied by it, in accordance with the provisions of the series of Securities in
respect of which it was deposited and this Indenture, to the payment, either
directly or through any Paying Agent (including the Company acting as its own
Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of
the principal (and premium, if any) and interest for whose payment such money
has been deposited with the Trustee; but such money need not be segregated from
other funds except to the extent required by law.
Anything herein to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon Company Request any
money or securities deposited with and held by it as provided in Section 4.03
and this Section 4.02 which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof which would then
be required to be deposited to effect an equivalent satisfaction and discharge,
Discharge or covenant defeasance, provided that the Trustee shall not be
required
38
to liquidate any securities in order to comply with the provisions of this
paragraph.
SECTION 4.03. Defeasance Upon Deposit of Funds or Government
Obligations. Unless pursuant to Section 3.01 provision is made that this Section
shall not be applicable to the Securities of any series, at the Company's
option, either (a) the Company shall be deemed to have been Discharged (as
defined below) from its obligations with respect to any series of Securities
after the applicable conditions set forth below have been satisfied or (b) the
Company shall cease to be under any obligation to comply with any term,
provision or condition set forth in Sections 10.05, and 10.06 and Article VIII
(and any other Sections or covenants applicable to such Securities that are
determined pursuant to Section 3.01 to be subject to this provision), and clause
(4) of Section 5.01 of this Indenture (and any other Events of Default
applicable to such Securities that are determined pursuant to Section 3.01 to be
subject to this provision) shall be deemed not to be an Event of Default, with
respect to any series of Securities at any time after the applicable conditions
set forth below have been satisfied:
(1) the Company shall have deposited or caused to be deposited
irrevocably with the Trustee as trust funds in trust, specifically
pledged as security for, and dedicated solely to, the benefit of the
Holders of the Securities of such series (i) money in an amount, or
(ii) the equivalent in securities of the government which issued the
currency in which the Securities are denominated or government agencies
backed by the full faith and credit of such government which through
the payment of interest and principal in respect thereof in accordance
with their terms will provide freely available funds on or prior to the
due date of any payment, money in an amount, or (iii) a combination of
(i) and (ii), sufficient, in the opinion (with respect to (ii) and
(iii)) of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered to
the Trustee, to pay and discharge each installment of principal
(including mandatory sinking fund payments) and any premium of,
interest on and any repurchase or redemption obligations with respect
to the outstanding Securities of such series on the dates such
installments of interest or principal or repurchase or redemption
obligations are due (before such a deposit, if the Securities of such
series are then redeemable or may be redeemed in the future pursuant to
the terms thereof, in either case at the option of the Company, the
39
Company may give to the Trustee, in accordance with Section 11.02, a
notice of its election to redeem all of the Securities of such series
at a future date in accordance with Article XI);
(2) no Event of Default or event (including such deposit)
which with notice or lapse of time would become an Event of Default
with respect to the Securities of such series shall have occurred and
be continuing on the date of such deposit;
(3) the Company shall have delivered to the Trustee (A) an
Opinion of Counsel 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 the Company's exercise of its option under this
Section 4.03 and will be subject to Federal income tax on the same
amount and in the same manner and at the same times as would have been
the case if such option had not been exercised, and, in the case of
Securities being Discharged, accompanied by a ruling to that effect
from the Internal Revenue Service, unless, as set forth in such Opinion
of Counsel, there has been a change in the applicable federal income
tax law since the date of this Indenture such that a ruling from the
Internal Revenue Service is no longer required and (B) an Opinion of
Counsel, subject to such qualifications, exceptions, assumptions and
limitations as are reasonably deemed necessary by such counsel and are
reasonably satisfactory to counsel for the Trustee, to the effect that
the trust resulting from the deposit referred to in paragraph (1) above
does not violate the Investment Company Act of 1940;
(4) the Company shall have delivered to the Trustee an
Officers' Certificate stating that the deposit referred to in paragraph
(1) above was not made by the Company with the intent of preferring the
Holders over other creditors of the Company or with the intent of
defeating, hindering, delaying or defrauding creditors of the Company
or others; and
(5) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel each stating that all
conditions precedent herein provided for relating to the satisfaction
and discharge of this Indenture with respect to the Securities of such
series have been complied with.
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If the Company, at its option, with respect to a series of
Securities, satisfies the applicable conditions pursuant to either clause (a) or
(b) of the first sentence of this Section, then (x), in the event the Company
satisfies the conditions to clause (a) and elects clause (a) to be applicable,
each of America Online, Time Warner, TBS and TWC shall be deemed to have paid
and discharged the entire indebtedness represented by, and obligations under,
its respective guarantee of the Securities of such series and to have satisfied
all the obligations under this Indenture relating to the Securities of such
series and (y) in either case, each of America Online, Time Warner, TBS and TWC
shall cease to be under any obligation to comply with any term, provision or
condition set forth in Article Eight (and any other covenants applicable to such
Securities that are determined pursuant to Section 3.01 to be subject to this
provision), and clause (4) of Section 5.01 (and any other Events of Default
applicable to such series of Securities that are determined pursuant to Section
3.01 to be subject to this provision) shall be deemed not to be an Event of
Default with respect to such series of Securities at any time thereafter.
"Discharged" means that the Company shall be deemed to have
paid and discharged the entire indebtedness represented by, and obligations
under, the Securities of such series and to have satisfied all the obligations
under this Indenture relating to the Securities of such series (and the Trustee,
on receipt of a Company Request and at the expense of the Company, shall execute
proper instruments acknowledging the same), except (A) the rights of Holders of
Securities to receive, from the trust fund described in clause (1) above,
payment of the principal and any premium of and any interest on such Securities
when such payments are due; (B) the Company's obligations with respect to such
Securities under Sections 3.05, 3.06, 4.02, 6.07, 10.02 and 10.03; (C) the
Company's right of redemption, if any, with respect to any Securities of such
series pursuant to Article XI, in which case the Company may redeem the
Securities of such series in accordance with Article XI by complying with such
Article and depositing with the Trustee, in accordance with Section 11.05, an
amount of money sufficient, together with all amounts held in trust pursuant to
Section 4.02 with respect to Securities of such series, to pay the Redemption
Price of all the Securities of such series to be redeemed; and (D) the rights,
powers, trusts, duties and immunities of the Trustee hereunder.
SECTION 4.04. Reinstatement. If the Trustee or Paying Agent
is unable to apply any money or securities in accordance with Section 4.02 of
this Indenture, by reason of
41
any legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, the Company's and, if applicable, the Guarantors' obligations under
this Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to Section 4.01 or 4.03 of this Indenture, as the
case may be, until such time as the Trustee or Paying Agent is permitted to
apply all such money or securities in accordance with Section 4.02 of this
Indenture; provided that, if the Company has made any payment of principal of or
interest on any Securities because of the reinstatement of its obligations, the
Company shall be subrogated to the rights of the Holders of such Securities to
receive such payment from the money or securities held by the Trustee or Paying
Agent.
ARTICLE V
Remedies
SECTION 5.01. Events of Default. "Event of Default", wherever
used herein, means with respect to any series of Securities any one of the
following events (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary or be effected by operation of law or pursuant
to any judgment, decree or order of any court or any order, rule or regulation
of any administrative or governmental body), unless such event is either
inapplicable to a particular series or it is specifically deleted or modified in
or pursuant to the supplemental indenture or Board Resolution creating such
series of Securities or in the form of Security for such series:
(1) default in the payment of any interest upon any Security
of that series when it becomes due and payable, and continuance of such
default for a period of 30 days; or
(2) default in the payment of the principal of (or premium,
if any, on) any Security of that series at its Maturity; or
(3) default in the payment of any sinking or purchase fund or
analogous obligation when the same becomes due by the terms of the
Securities of such series; or
42
(4) default in the performance, or breach, of any covenant or
warranty of the Company, America Online, Time Warner, TWC or TBS in
this Indenture in respect of the Securities of such series (other than
a covenant or warranty in respect of the Securities of such series a
default in the performance of which or the breach of which is elsewhere
in this Section specifically dealt with), all of such covenants and
warranties in the Indenture which are not expressly stated to be for
the benefit of a particular series of Securities being deemed in
respect of the Securities of all series for this purpose, and
continuance of such default or breach for a period of 90 days after
there has been given, by registered or certified mail, to the Company
(or, if applicable, America Online, Time Warner, TWC or TBS) by the
Trustee or to the Company (or, if applicable, America Online, Time
Warner, TWC or TBS) and the Trustee by the Holders of at least 25% in
aggregate principal amount of the Outstanding Securities of such
series, a written notice specifying such default or breach and
requiring it to be remedied and stating that such notice is a "Notice
of Default" hereunder; or
(5) the entry of an order for relief against the Company or
any Material U.S. Subsidiary thereof under ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Code
(the "Federal Bankruptcy Act") by a court having jurisdiction in the
premises or a decree or order by a court having jurisdiction in the
premises adjudging the Company or any Material U.S. Subsidiary thereof
a bankrupt or insolvent under any other applicable Federal or State
law, or the entry of a decree or order approving as properly filed a
petition seeking reorganization, arrangement, adjustment or composition
of or in respect of the Company or any Material U.S. Subsidiary thereof
under the Federal Bankruptcy Act or any other applicable Federal or
State law, or appointing a receiver, liquidator, assignee, trustee,
sequestrator (or other similar official) of the Company or any Material
U.S. Subsidiary thereof or of any substantial part of its property, or
ordering the winding up or liquidation of its affairs, and the
continuance of any such decree or order unstayed and in effect for a
period of 90 consecutive days; or
(6) the consent by the Company or any Material U.S. Subsidiary
thereof to the institution of bankruptcy or insolvency proceedings
against it, or the filing by it of a petition or answer or consent
seeking reorganization or relief under the Federal Bankruptcy Act or
any other applicable Federal or State law, or
43
the consent by it to the filing of any such petition or to the
appointment of a receiver, liquidator, assignee, trustee, sequestrator
(or other similar official) of the Company or any Material U.S.
Subsidiary thereof or of any substantial part of its property, or the
making by it of an assignment for the benefit of creditors, or the
admission by it in writing of its inability to pay its debts generally
as they become due, or the taking of corporate action by the Company or
any Material U.S. Subsidiary thereof in furtherance of any such action;
(7) any Guarantee shall for any reason cease to be, or be
asserted in writing by any Guarantor or the Company not to be, in full
force and effect, enforceable in accordance with its terms, except to
the extent contemplated by this Indenture and any such Guarantee; or
(8) any other Event of Default provided in the supplemental
indenture or Board Resolution under which such series of Securities is
issued or in the form of Security for such series.
SECTION 5.02. Acceleration of Maturity; Rescission and
Annulment. If an Event of Default described in paragraph (1), (2), (3), (4), (7)
or (8) (if the Event of Default under paragraph (4) or (8) is with respect to
less than all series of Securities then Outstanding) of Section 5.01 occurs and
is continuing with respect to any series, 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 (each such series acting as a separate class), by notice in writing to
the Company (and to the Trustee if given by Holders), may declare the principal
amount (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 the Securities of such series and all accrued
interest thereon 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 of such series contained to the
contrary notwithstanding. If an Event of Default described in paragraph (4) or
(8) (if the Event of Default under paragraph (4) or (8) is with respect to all
series of Securities then Outstanding), of Section 5.01 occurs and is
continuing, then and in each and every such case, unless the principal of all
the Securities shall have already become due and payable, either the
44
Trustee or the Holders of not less than 25% in aggregate principal amount of all
the Securities then Outstanding hereunder (treated as one class), by notice in
writing to the Company (and to the Trustee if given by Holders), may declare the
principal amount (or, if any Securities are Original Issue Discount Securities,
such portion of the principal amount as may be specified in the terms thereof)
of all the Securities then Outstanding and all accrued interest thereon 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. If an Event of Default of
the type set forth in paragraph (5) or (6) of Section 5.01 occurs and is
continuing, the principal of and any interest on the Securities then outstanding
shall become immediately due and payable.
At any time after such a declaration of acceleration has been
made with respect to the Securities of any or all series, as the case may be,
and before a judgment or decree for payment of the money due has been obtained
by the Trustee as hereinafter in this Article provided, the Holders of a
majority in principal amount of the outstanding Securities of such series, by
written notice to the Company and the Trustee, may rescind and annul such
declaration and its consequences if:
(1) the Company has paid or deposited with the
Trustee a sum sufficient to pay:
(A) all overdue installments of interest on
the Securities of such series;
(B) the principal of (and premium, if any, on) any
Securities of such series which have become due otherwise than
by such declaration of acceleration, and interest thereon at
the rate or rates prescribed therefor by the terms of the
Securities of such series, to the extent that payment of such
interest is lawful;
(C) interest upon overdue installments of interest at
the rate or rates prescribed therefor by the terms of the
Securities of such series to the extent that payment of such
interest is lawful; and
(D) all sums paid or advanced by the Trustee
hereunder and the reasonable compensation,
expenses, disbursements and advances of the
45
Trustee, its agents and counsel and all other amounts due the
Trustee under Section 6.07; and
(2) all Events of Default with respect to such series of
Securities, other than the nonpayment of the principal of the
Securities of such series which have become due solely by such
acceleration, have been cured or waived as provided in Section 5.13.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
SECTION 5.03. Collection of Indebtedness and Suits for
Enforcement by Trustee. The Company covenants that if:
(1) default is made in the payment of any installment of
interest on any Security of any series when such interest becomes due
and payable; or
(2) default is made in the payment of the principal of (or
premium, if any, on) any Security at the Maturity thereof; or
(3) default is made in the payment of any sinking or purchase
fund or analogous obligation when the same becomes due by the terms of
the Securities of any series;
and any such default continues for any period of grace provided with respect to
the Securities of such series, the Company will, upon demand of the Trustee, pay
to it, for the benefit of the Holder of any such Security (or the Holders of any
such series in the case of Clause (3) above), the whole amount then due and
payable on any such Security (or on the Securities of any such series in the
case of Clause (3) above) for principal (and premium, if any) and interest, with
interest, to the extent that payment of such interest shall be legally
enforceable, upon the overdue principal (and premium, if any) and upon overdue
installments of interest, at such rate or rates as may be prescribed therefor by
the terms of any such Security (or of Securities of any such series in the case
of Clause (3) above); and, in addition thereto, such further amount as shall be
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel and all other amounts due the Trustee under Section 6.07.
If the Company fails to pay such amounts forthwith upon such
demand, the Trustee, in its own name and as
46
trustee of an express trust, may institute a judicial proceeding for the
collection of the sums so due and unpaid, and may prosecute such proceeding to
judgment or final decree, and may enforce the same against the Company or any
other obligor upon the Securities of such series and collect the money adjudged
or decreed to be payable in the manner provided by law out of the property of
the Company or any other obligor upon such Securities, wherever situated.
If an Event of Default with respect to any series of
Securities occurs and is continuing, the Trustee may in its discretion proceed
to protect and enforce its rights and the rights of the Holders of Securities of
such series by such appropriate judicial proceedings as the Trustee shall deem
most effectual to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.
SECTION 5.04. Trustee May File Proofs of Claim. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Company or any other obligor upon the Securities or
the property of the Company or of such other obligor or their creditors, the
Trustee (irrespective of whether the principal of the Securities shall then be
due and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Trustee shall have made any demand on the Company
for the payment of overdue principal or interest) shall be entitled and
empowered, by intervention in such proceedings or otherwise:
(i) to file and prove a claim for the whole amount of
principal (or portion thereof determined pursuant to Section 3.01(16)
to be provable in bankruptcy) (and premium, if any) and interest owing
and unpaid in respect of the Securities and to file such other papers
or documents as may be necessary and advisable in order to have the
claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel and all other amounts due the Trustee under Section
6.07) and of the Securityholders allowed in such judicial proceeding;
and
(ii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;
47
and any receiver, assignee, trustee, liquidator, sequestrator (or other similar
official) in any such judicial proceeding is hereby authorized by each
Securityholder to make such payment to the Trustee and in the event that the
Trustee shall consent to the making of such payments directly to the
Securityholders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 6.07.
Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any
Securityholder, any plan of reorganization, arrangement, adjustment or
composition affecting the Securities or the rights of any Holder thereof, or to
authorize the Trustee to vote in respect of the claim of any, Securityholder in
any such proceeding.
SECTION 5.05. Trustee May Enforce Claims Without Possession of
Securities. All rights of action and claims under this Indenture or the
Securities of any series may be prosecuted and enforced by the Trustee without
the possession of any of the Securities of such series or the production thereof
in any proceeding relating thereto, and any such proceeding instituted by the
Trustee shall be brought in its own name as trustee of an express trust, and any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agent and
counsel and any other amounts due the Trustee under Section 6.07, be for the
ratable benefit of the Holders of the Securities of the series in respect of
which such judgment has been recovered.
SECTION 5.06. Application of Money Collected. Any money
collected by the Trustee with respect to a series of Securities pursuant to this
Article shall be applied in the following order, at the date or dates fixed by
the Trustee and, in case of the distribution of such money on account of
principal (or premium, if any) or interest, upon presentation of the Securities
of such series and the notation thereon of the payment if only partially paid
and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under
Section 6.07.
SECOND: To the payment of the amounts then due and unpaid upon
the Securities of that series for principal (and premium, if any) and interest,
in respect of which or
48
for the benefit of which such money has been collected, ratably, without
preference or priority of any kind, according to the amounts due and payable on
such Securities for principal (and premium, if any) and interest, respectively.
SECTION 5.07. Limitation on Suits. No Holder of any Security
of any series shall have any right to institute any proceeding, judicial or
otherwise, with respect to this Indenture, or for the appointment of a receiver
or trustee, or for any other remedy hereunder, unless:
(1) such Holder has previously given written notice to the
Trustee of, a continuing Event of Default with respect to Securities of
such series;
(2) the Holders of not less than 25% in principal amount of
the outstanding Securities of such series shall have made written
request to the Trustee to institute proceedings in respect of such
Event of Default in its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to be
incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such
proceeding; and
(5) no direction inconsistent with such written request has
been given to the Trustee during such 60- day period by the Holders of
a majority in principal amount of the Outstanding Securities of such
series;
it being understood and intended that no one or more Holders of Securities of
such series shall have any right in any manner whatever by virtue of, or by
availing of, any provision of this Indenture to affect, disturb or prejudice the
rights of any other Holders of Securities of such series, or to obtain or to
seek to obtain priority or preference over any other such Holders or to enforce
any right under this Indenture, except in the manner herein provided and for the
equal and proportionate benefit of all the Holders of all Securities of such
series.
SECTION 5.08. Unconditional Right of Securityholders To
Receive Principal, Premium and Interest. Notwithstanding any other provisions in
this Indenture, the Holder of any Security shall have the right, which is
49
absolute and unconditional, to receive payment of the principal of (and premium,
if any) and (subject to Section 3.07) interest on such Security on the
respective Stated Maturities expressed in such Security (or, in the case of
redemption or repayment, on the Redemption Date or Repayment Date, as the case
may be) and to institute suit for the enforcement of any such payment, and such
right shall not be impaired without the consent of such Holder.
SECTION 5.09. Restoration of Rights and Remedies. If the
Trustee or any Securityholder has instituted any proceeding to enforce any right
or remedy under this Indenture and such proceeding has been discontinued or
abandoned for any reason, then and in every such case the Company, the Trustee
and the Securityholders shall, subject to any determination in such proceeding,
be restored severally and respectively to their former positions hereunder, and
thereafter all rights and remedies of the Trustee and the Securityholders shall
continue as though no such proceeding had been instituted.
SECTION 5.10. Rights and Remedies Cumulative. No right or
remedy herein conferred upon or reserved to the Trustee or to the
Securityholders is intended to be exclusive of any other right or remedy, and
every right and remedy shall, to the extent permitted by law, be cumulative and
in addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 5.11. Delay or Omission Not Waiver. No delay or
omission of the Trustee or of any Holder of any Security to exercise any right
or remedy accruing upon any Event of Default shall impair any such right or
remedy or constitute a waiver of any such Event of Default or an acquiescence
therein. Every right and remedy given by this Article or by law to the Trustee
or to the Securityholders may be exercised from time to time, and as often as
may be deemed expedient, by the Trustee or by the Securityholders, as the case
may be.
SECTION 5.12. Control by Securityholders. The Holders of a
majority in principal amount of the Outstanding Securities of any series shall
have the right to direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee or exercising any trust or
50
power conferred on the Trustee with respect to the Securities of such series,
provided that:
(1) the Trustee shall have the right to decline to follow any
such direction if the Trustee, being advised by counsel, determines
that the action so directed may not lawfully be taken or would conflict
with this Indenture or if the Trustee in good faith shall, by a
Responsible Officer, determine that the proceedings so directed would
involve it in personal liability or be unjustly prejudicial to the
Holders not taking part in such direction, and
(2) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
SECTION 5.13. Waiver of Past Defaults. The Holders of not less
than a majority in principal amount of the Outstanding Securities of any series
may on behalf of the Holders of all the Securities of such series waive any past
default hereunder with respect to such series and its consequences, except a
default not theretofore cured:
(1) in the payment of the principal of (or premium, if any) or
interest on any Security of such series, or in the payment of any
sinking or purchase fund or analogous obligation with respect to the
Securities of such series, or
(2) in respect of a covenant or provision hereof which under
Article IX cannot be modified or amended without the consent of the
Holder of each Outstanding Security of such series.
Upon any such waiver, such default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other default or impair any right consequent thereon.
SECTION 5.14. Undertaking for Costs. All parties to this
Indenture agree, and each Holder of any Security by his acceptance thereof shall
be deemed to have agreed, that any court may in its discretion require, in any
suit for the enforcement of any right or remedy under this Indenture, or in any
suit against the Trustee for any action taken or omitted by it as Trustee, the
filing by any party litigant in such suit of an undertaking to pay the costs of
such suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees,
51
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Securityholder, or group of
Securityholders, holding in the aggregate more than lot in principal amount of
the Outstanding Securities of any series to which the suit relates, or to any
suit instituted by any Securityholder for the enforcement of the payment of the
principal of (or premium, if any) or interest on an Security on or after the
respective Stated Maturities expressed in such Security (or, in the case of
redemption or repayment, on or after the Redemption Date or Repayment Date, as
the case may be).
SECTION 5.15. Waiver of Stay or Extension Laws. The Company
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law wherever enacted, now or at
any time hereafter in force, which may affect the covenants or the performance
of this Indenture; and the Company (to the extent that it may lawfully do so)
hereby expressly waives all benefit or advantage of any such law, and covenants
that it will not hinder, delay or impede the execution of any power herein
granted to the Trustee, but will suffer and permit the execution of every such
power as though no such law had been enacted.
ARTICLE VI
The Trustee
SECTION 6.01. Certain Duties and Responsibilities. (a) Except
during the continuance of an Event of Default with respect to any series of
Securities:
(1) the Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture with
respect to the Securities of such series, and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may,
with respect to Securities of such series, conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture; but in the case of
any such certificates or opinions
52
which by any provision hereof are specifically required to be furnished
to the Trustee, the Trustee shall be under a duty to examine the same
to determine whether or not they conform to the requirements of this
Indenture.
(b) In case an Event of Default with respect to any series of
Securities has occurred and is continuing, the Trustee shall exercise with
respect to the Securities of such series such of the rights and powers vested in
it by this Indenture, and use the same degree of care and skill in their
exercise, as a prudent man would exercise or use under the circumstances in the
conduct of his own affairs.
(c) No provision of this Indenture shall be construed to
relieve the Trustee from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that:
(1) this Subsection shall not be construed to limit the
effect of Subsection (a) of this Section;
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it shall be proved
that the Trustee was negligent in ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the
direction of the Holders of a majority in principal amount of the
Outstanding Securities of any series 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 with respect to the Securities of such series; and
(4) no provision of this Indenture shall require the Trustee
to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder, or in the
exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to
it.
(d) Whether or not therein expressly so provided, every
provision of this Indenture relating to the conduct or affecting the liability
of or affording protection to the Trustee shall be subject to the provisions of
this Section.
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SECTION 6.02. Notice of Defaults. Within 90 days after the
occurrence of any default hereunder with respect to Securities of any series,
the Trustee shall transmit by mail to all Securityholders of such series, as
their names and addresses appear in the Security Register, notice of such
default hereunder known to the Trustee, unless such default shall have been
cured or waived; provided, however, that, except in the case of a default in the
payment of the principal of (or premium, if any) or interest on any Security of
such series or in the payment of any sinking or purchase fund installment or
analogous obligation with respect to 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 determine that the withholding
of such notice is in the interests of the Securityholders of such series; and
provided, further, that in the case of any default of the character specified in
Section 5.01(4) with respect to Securities of such series no such notice to
Securityholders of such series shall be given until at least 90 days after the
occurrence thereof. For the purpose of this Section, the term "default", with
respect to Securities of any series, means any event which is, or after notice
or lapse of time or both would become, an Event of Default with respect to
Securities of such series.
SECTION 6.03. Certain Rights of Trustee. Except as otherwise
provided in 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, direction, consent,
order, bond, debenture or other paper or document believed by it to be
genuine and to have been signed or presented by the proper party or
parties;
(b) any request or direction of the Company mentioned herein
shall be sufficiently evidenced by a Company Request or Company Order
and any resolution of the Board of Directors may be sufficiently
evidenced by a Board Resolution;
(c) whenever in the administration of this Indenture the
Trustee shall deem it desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder, the
Trustee (unless other evidence be herein specifically prescribed) may,
in the absence of bad faith on its part, rely upon an Officers'
Certificate;
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(d) the Trustee may consult with counsel and the written
advice of such counsel or and Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in reliance
thereon;
(e) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request
or direction of any of the Securityholders pursuant to this Indenture,
unless such Securityholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such
request or direction;
(f) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture or other paper or document, but the
Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such further inquiry or investigation,
it shall be entitled to examine the books, records and premises of the
Company, personally or by agent or attorney;
(g) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys and the Trustee shall not be responsible
for any misconduct or negligence on the part of any agent or attorney
appointed with due care by it hereunder;
(h) the Trustee shall not be charged with knowledge of any
default (as defined in Section 6.02) or Event of Default with respect
to the Securities of any series for which it is acting as Trustee
unless either (1) a Responsible Officer of the Trustee assigned to the
Corporate Trust Department of the Trustee (or any successor division or
department of the Trustee) shall have actual knowledge of such default
or Event of Default or (2) written notice of such default or Event of
Default shall have been given to the Trustee by the Company or any
other obligor on such Securities or by any Holder of such Securities;
and
(i) the Trustee shall not be liable for any action taken,
suffered or omitted by it in good faith and believed by it to be
authorized or within the
55
discretion or rights or powers conferred upon it by this Indenture.
SECTION 6.04. Not Responsible for Recitals or Issuance of
Securities. The recitals contained herein and in the Securities, except the
certificates of authentication, shall be taken as the statements of the Company,
and the Trustee assumes no responsibility for their correctness. The Trustee
makes no representations as to the validity or sufficiency of this Indenture or
of the Securities. The Trustee shall not be accountable for the use or
application by the Company of Securities or the proceeds thereof.
SECTION 6.05. May Hold Securities. The Trustee, any
Authenticating Agent, any Paying Agent, the Security Registrar, any Conversion
Agent or any other agent of the Company, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to Sections
6.08 and 6.13, may otherwise deal with the Company or any Guarantor with the
same rights it would have if it were not Trustee, Authenticating Agent, Paying
Agent, Security Registrar, Conversion Agent or such other agent.
SECTION 6.06. Money Held in Trust. Subject to the provisions
of Section 10.03 hereof, all moneys in any currency or currency 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 any money received by it hereunder except as otherwise
agreed in writing with the Company.
SECTION 6.07. Compensation and Reimbursement. The Company
agrees:
(1) to pay to the Trustee from time to time reasonable
compensation for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to
reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Indenture (including the
reasonable compensation and the expenses and disbursements of its
agents and counsel), except any such expense,
56
disbursement or advance as may be attributable to its negligence or bad
faith; and
(3) to indemnify the Trustee for, and to hold it harmless
against, any loss, liability or expense incurred without negligence or
bad faith on its part, arising out of or in connection with the
acceptance or administration of this trust, including the costs and
expenses of defending itself against any claim or liability in
connection with the exercise or performance of any of its powers or
duties hereunder.
As security for the performance of the obligations of the
Company under this Section the Trustee shall have a lien prior to the Securities
upon all property and funds held or collected by the Trustee as such, except
funds held in trust for the payment of principal of (and premium, if any) or
interest on particular Securities.
When the Trustee incurs expenses or renders services in
connection with an Event of Default specified in Section 5.01(5) or (6), the
expenses and the compensation for the services are intended to constitute
expenses of administration under any bankruptcy law.
The Company's obligations under this Section 6.07 and any lien
arising hereunder shall survive the resignation or removal of any Trustee, the
discharge of the Company's obligations pursuant to Article IV of this Indenture
and/or the termination of this Indenture.
SECTION 6.08. Disqualification; Conflicting Interests. The
Trustee for the Securities of any series issued hereunder shall be subject to
the provisions of Section 310(b) of the Trust Indenture Act during the period of
time provided for therein. In determining whether the Trustee has a conflicting
interest as defined in Section 310(b) of the Trust Indenture Act with respect to
the Securities of any series, there shall be excluded this Indenture with
respect to Securities of any particular series of Securities other than that
series. Nothing herein shall prevent the Trustee from filing with the Commission
the application referred to in the second to last paragraph of Section 310(b) of
the Trust Indenture Act.
SECTION 6.09. Corporate Trustee Required; Eligibility. There
shall at all times be a Trustee
57
hereunder with respect to each series of Securities, which shall be
either:
(i) a corporation organized and doing business under the laws
of the United States of America or of any State, authorized under such
laws to exercise corporate trust powers and subject to supervision or
examination by Federal or State authority, or
(ii) a corporation or other Person organized and doing
business under the laws of a foreign government that is permitted to
act as Trustee pursuant to a rule, regulation or order of the
Commission, authorized under such laws to exercise corporate trust
powers, and subject to supervision or examination by authority of such
foreign government or a political subdivision thereof substantially
equivalent to supervision or examination applicable to United States
institutional trustees;
in either case having a combined capital and surplus of at least $50,000,000. If
such corporation publishes reports of condition at least annually, pursuant to
law or to the requirements of the aforesaid supervising or examining authority,
then for the purposes of this Section, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. Neither the Company nor any
Person directly or indirectly controlling, controlled by, or under common
control with the Company shall serve as trustee for the Securities of any series
issued hereunder. If at any time the Trustee with respect to any series of
Securities shall cease to be eligible in accordance with the provisions of this
Section, it shall resign immediately in the manner and with the effect specified
in Section 6.10.
SECTION 6.10. Resignation and Removal. (a) No resignation or
removal of the Trustee and no appointment of a successor Trustee pursuant to
this Article shall become effective until the acceptance of appointment by the
successor Trustee under Section 6.11.
(b) The Trustee may resign with respect to any series of
Securities at any time by giving written notice thereof to the Company. If an
instrument of acceptance by a successor Trustee shall not have been delivered to
the Trustee within 30 days after the giving of such notice of resignation, the
resigning Trustee may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
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(c) The Trustee may be removed with respect to any series of
Securities at any time by Act of the Holders of a majority in principal amount
of the outstanding Securities of that series, delivered to the Trustee and to
the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 310(b) of
the Trust Indenture Act pursuant to 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 of
that series for at least six months, unless the Trustee's duty to
resign is stayed in accordance with the provisions of Section 310(b) of
the Trust Indenture Act, or
(2) the Trustee shall cease to be eligible under Section 6.09
with respect to any series of Securities 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 with respect
to any series of Securities, or
(4) the Trustee shall be adjudged a bankrupt or insolvent or a
receiver of the Trustee or of its property shall be appointed or any
public officer shall take charge or control of the Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation,
then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee, with respect to the series, or in the case of Clause (4), with respect
to all series, or (ii) subject to Section 5.14, any Securityholder who has been
a bona fide Holder of a Security of such series for at least six months may, on
behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee with respect to the series, or, in the case of Clause (4),
with respect to all series.
(e) If the Trustee shall resign, be removed or become
incapable of acting with respect to any series of Securities, or if a vacancy
shall occur in the office of the Trustee with respect to any series of
Securities for any cause, the Company, by Board Resolution, shall promptly
appoint a successor Trustee for that series of Securities.
59
If, within one year after such resignation, removal or incapacity, or the
occurrence of such vacancy, a successor Trustee with respect to such series of
Securities shall be appointed by Act of the Holders of a majority in principal
amount of the Outstanding Securities of such series delivered to the Company and
the retiring Trustee, the successor Trustee so appointed shall, forthwith upon
its acceptance of such appointment, become the successor Trustee with respect to
such series and supersede the successor Trustee appointed by the Company with
respect to such series. If no successor Trustee with respect to such series
shall have been so appointed by the Company or the Securityholders of such
series and accepted appointment in the manner hereinafter provided, subject to
Section 5.14, any Securityholder who has been a bona fide Holder of a Security
of that series for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Trustee with respect to such series.
(f) The Company shall give notice of each resignation and each
removal of the Trustee with respect to any series and each appointment of a
successor Trustee with respect to any series by mailing written notice of such
event by first-class mail, postage prepaid, to the Holders of Securities of that
series as their names and addresses appear in the Security Register. Each notice
shall include the name of the successor Trustee and the address of its principal
Corporate Trust Office.
SECTION 6.11. Acceptance of Appointment by Successor. Every
successor Trustee appointed hereunder shall execute, acknowledge and deliver to
the Company and to the predecessor Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the predecessor Trustee
shall become effective with respect to any series as to which it is resigning or
being removed as Trustee, and such successor Trustee, without any further act,
deed or conveyance, shall become vested with all the rights, powers, trusts and
duties of the predecessor Trustee with respect to any such series; but, on
request of the Company or the successor Trustee, such predecessor Trustee shall,
upon payment of its reasonable charges, if any, execute and deliver an
instrument transferring to such successor Trustee all the rights, powers and
trusts of the predecessor Trustee, and shall duly assign, transfer and deliver
to such successor Trustee all property and money held by such predecessor
trustee hereunder with respect to all or any such series, subject nevertheless
to its lien, if any, provided for in Section 6.07. Upon request of any such
60
successor Trustee, the Company shall execute any and all instruments for more
fully and certainly vesting in and confirming to such successor Trustee all such
rights, powers and trusts.
In case of the appointment hereunder of a successor Trustee
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 which shall contain such provisions as shall be deemed
necessary or desirable to confirm that all the rights, powers, trusts and duties
of the predecessor Trustee with respect to the Securities of any series as to
which the predecessor Trustee is not being succeeded shall continue to be vested
in the predecessor Trustee, and shall add to or change any of the provisions of
this Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one Trustee, it being
understood that nothing herein or in such supplemental indenture shall
constitute such Trustees co-trustees of the same trust and that each such
Trustee shall be Trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Trustee.
No successor Trustee with respect to any series of Securities
shall accept its appointment unless at the time of such acceptance such
successor Trustee shall be qualified and eligible with respect to that series
under this Article.
SECTION 6.12. Merger, Conversion, Consolidation or Succession
to Business. Any corporation into which the Trustee may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto. In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.
61
SECTION 6.13. Preferential Collection of Claims Against
Company. The Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated.
SECTION 6.14. Appointment of Authenticating Agent. At any time
when any of the Securities remain Outstanding the Trustee, with the approval of
the Company, may appoint an Authenticating Agent or Agents with respect to one
or more series of Securities which shall be authorized to act on behalf of the
Trustee to authenticate Securities of such series issued upon original issuance,
exchange, registration of transfer or partial redemption thereof or pursuant to
Section 3.06, and Securities so authenticated shall be entitled to the benefits
of this Indenture and shall be valid and obligatory for all purposes as if
authenticated by the Trustee hereunder. Wherever reference is made in this
Indenture to the authentication and delivery of Securities by the Trustee or the
Trustee's certificate of authentication, such reference shall be deemed to
include authentication and delivery on behalf of
62
the Trustee by an Authenticating Agent and a certificate of authentication
executed on behalf of the Trustee by an Authenticating Agent. Each
Authenticating Agent shall be acceptable to the Company and shall at all times
be a corporation organized and doing business under the laws of the United
States of America, any State thereof or the District of Columbia, authorized
under such laws to act as an Authenticating Agent, having a combined capital and
surplus of not less than $50,000,000 and, if other than the Company itself,
subject to supervision or examination by Federal or State authority. If such
Authenticating Agent publishes reports of condition at least annually, pursuant
to law or to the requirements of said supervising or examining authority, then
for the purposes of this Section, the combined capital and surplus of such
Authenticating Agent shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time an
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, such Authenticating Agent shall resign immediately
in the manner and with the effect specified in this Section.
Any corporation into which an Authenticating Agent may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which such
Authenticating Agent shall be a party, or any corporation succeeding to the
corporate agency or corporate trust business of an Authenticating Agent, shall
continue to be an Authenticating Agent, provided such corporation shall be
otherwise eligible under this Section, without the execution or filing of any
paper or any further act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving
written notice thereof to the Trustee and, if other than the Company, to the
Company. The Trustee may at any time terminate the agency of an Authenticating
Agent by giving written notice thereof to such Authenticating Agent and, if
other than the Company, to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee, with the approval of the Company, may
appoint a successor Authenticating Agent which shall be acceptable to the
Company and shall mail written notice of such appointment by first-class mail,
postage prepaid, to all Holders of Securities of the series with respect to
which such Authenticating Agent will serve, as their names and addresses appear
in the Security
63
Register. Any successor Authenticating Agent upon acceptance of its appointment
hereunder shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as if originally named as an
Authenticating Agent. No successor Authenticating Agent shall be appointed
unless eligible under the provisions of this Section.
The Company agrees to pay to each Authenticating Agent from
time to time reasonable compensation for its services under this Section.
If an appointment with respect to one or more series is made
pursuant to this Section, the Securities of such series may have endorsed
thereon, in addition to the Trustee's certificate of authentication, an
alternate certificate of authentication in the following form:
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
THE CHASE MANHATTAN BANK,
as Trustee
by
-------------------------
As Authenticating Agent
by
-------------------------
As Authorized Agent
ARTICLE VII
Securityholders' Lists and Reports by
Trustee and Company
SECTION 7.01. Company To Furnish Trustee Names and Addresses
of Securityholders. The Company will furnish or cause to be furnished to the
Trustee:
(1) semi-annually, not more than 15 days after December 15 and
June 15 in each year in such form as the Trustee may reasonably
require, a list of the names and addresses of the Holders of Securities
of each
64
series as of such December 15 and June 15, as applicable, and
(2) at such other times as the Trustee may request in writing,
within 30 days after the receipt by the Company of any such request, a
list of similar form and content as of a date not more than 15 days
prior to the time such list is furnished;
provided, however, that if and so long as the Trustee shall be the Security
Registrar for Securities of a series, no such list need be furnished with
respect to such series of Securities.
SECTION 7.02. Preservation of Information; Communications to
Securityholders. (a) The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders of Securities
contained in the most recent list furnished to the Trustee as provided in
Section 7.01 and the names and addresses of Holders of Securities received by
the Trustee in its capacity as Security Registrar, if so acting. The Trustee may
destroy any list furnished to it as provided in Section 7.01 upon receipt of a
new list so furnished.
(b) If three or more Holders of Securities of any series
(hereinafter referred to as "applicants") apply in writing to the Trustee, and
furnish to the Trustee reasonable proof that each such applicant has owned a
Security of such series for a period of at least six months preceding the date
of such application, and such application states that the applicants desire to
communicate with other Holders of Securities of such series or with the Holders
of all Securities with respect to their rights under this Indenture or under
such Securities and is accompanied by a copy of the form of proxy or other
communication which such applicants propose to transmit, then the Trustee shall,
within five Business Days after the receipt of such application, at its
election, either:
(i) afford such applicants access to the information
preserved at the time by the Trustee in accordance with Section
7.02(a), or
(ii) inform such applicants as to the approximate number of
Holders of Securities of such series or all Securities, as the case may
be, whose names and addresses appear in the information preserved at
the time by the Trustee in accordance with Section 7.02(a), and as to
the approximate cost of mailing to such
65
Securityholders the form of proxy or other communication, if any,
specified in such application.
If the Trustee shall elect not to afford such applicants
access to such information, the Trustee shall, upon the written request of such
applicants, mail to each Holder of a Security of such series or to all
Securityholders, as the case may be, whose names and addresses appear in the
information preserved at the time by the Trustee in accordance with Section
7.02(a), a copy of the form of proxy or other communication which is specified
in such request, with reasonable promptness after a tender to the Trustee of the
material to be mailed and of payment, or provision for the payment, of the
reasonable expenses of mailing, unless, within five days after such tender, the
Trustee shall mail to such applicants and file with the Commission, together
with a copy of the material to be mailed, a written statement to the effect
that, in the opinion of the Trustee, such mailing would be contrary to the best
interests of the Holders of Securities of such series or all Securityholders, as
the case may be, or would be in violation of applicable law. Such written
statement shall specify the basis of such opinion. If the Commission, after
opportunity for a hearing upon the objections specified in the written statement
so filed, shall enter an order refusing to sustain any of such objections or if,
after the entry of an order sustaining one or more of such objections, the
Commission shall find, after notice and opportunity for hearing, that all the
objections so sustained have been met and shall enter an order so declaring, the
Trustee shall mail copies of such material to all Securityholders of such series
or all Securityholders, as the case may be, with reasonable promptness after the
entry of such order and the renewal of such tender; otherwise the Trustee shall
be relieved of any obligation or duty to such applicants respecting their
application.
(c) Every Holder of Securities, by receiving and holding the
same, agrees with the Company and the Trustee that neither the Company nor the
Trustee shall be held accountable by reason of the disclosure of any such
information as to the names and addresses of the Holders of Securities in
accordance with Section 7.02(b), regardless of the source from which such
information was derived, and that the Trustee shall not be held accountable by
reason of mailing any material pursuant to a request made under Section 7.02(b).
SECTION 7.03. Reports by Trustee. (a) Within 60 days after
May 15 of each year commencing with the first May 15 after the issuance of
Securities, the Trustee shall
66
transmit by mail, at the Company's expense, to all Holders as their names and
addresses appear in the Security Register, as provided in Trust Indenture Act
313(c), a brief report dated as of May 15 in accordance with and with respect to
the matters required by Trust Indenture Act Section 313(a).
(b) The Trustee shall transmit by mail, at the Company's
expense, to all Holders as their names and addresses appear in the Security
Register, as provided in Trust Indenture Act 313(c), a brief report in
accordance with and with respect to the matters required by Trust Indenture Act
Section 313(b).
(c) A copy of each such report shall, at the time of such
transmission to Holders, be furnished to the Company and, in accordance with
Trust Indenture Act Section 313(d), be filed by the Trustee with each stock
exchange upon which the Securities are listed, and also with the Commission.
SECTION 7.04. Reports by Company. The Company shall file with
the Trustee, and transmit to Holders, such information, documents and other
reports, and such summaries thereof, as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided pursuant to such Act;
provided that any such information, documents or reports required to be filed
with the Commission pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 shall be filed with the Trustee within 15 days after the same is so
required to be filed with the Commission. The Company also shall comply with the
other provisions of Trust Indenture Act Section 314(a).
ARTICLE VIII
Consolidation, Merger, Conveyance or Transfer
SECTION 8.01. Consolidation, Merger, Conveyance or Transfer on
Certain Terms. None of the Company, America Online, Time Warner, TBS or TWC
shall consolidate with or merge into any other Person or convey or transfer its
properties and assets substantially as an entirety to any Person, unless:
(1)(a) in the case of the Company, the Person formed by such
consolidation or into which the Company is merged or the Person which
acquires by conveyance or transfer the properties and assets of the
Company substantially as an entirety shall be organized and existing
under the laws of the United States of America
67
or any State thereof or the District of Columbia, and shall expressly
assume, by an indenture supplemental hereto, executed and delivered to
the Trustee, in form satisfactory to the Trustee, the due and punctual
payment of the principal of (and premium, if any) and interest on all
the Securities and the performance of every covenant of this Indenture
(as supplemented from time to time) on the part of the Company to be
performed or observed; (b) in the case of any Guarantor, the Person
formed by such consolidation or into which such Guarantor is merged or
the Person which acquires by conveyance or transfer the properties and
assets of such Guarantor substantially as an entirety shall be either
(i) the Company or another Guarantor or (ii) a Person organized and
existing under the laws of the United States of America or any State
thereof or the District of Columbia, and in the case of clause (ii),
shall expressly assume, by an indenture supplemental hereto, executed
and delivered to the Trustee, in form satisfactory to the Trustee, the
performance of every covenant of this Indenture (as supplemented from
time to time) on the part of such Guarantor to be performed or
observed;
(2) immediately after giving effect to such transaction, no
Event of Default, and no event which, after notice or lapse of time, or
both, would become an Event of Default, shall have happened and be
continuing; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel each stating that such
consolidation, merger, conveyance or transfer and such supplemental
indenture comply with this Article and that all conditions precedent
herein provided for relating to such transaction have been complied
with.
SECTION 8.02. Successor Person Substituted. Upon any
consolidation or merger, or any conveyance or transfer of the properties and
assets of the Company or any Guarantor substantially as an entirety in
accordance with Section 8.01, the successor Person formed by such consolidation
or into which the Company or such Guarantor is merged or to which such
conveyance or transfer is made shall succeed to, and be substituted for, and may
exercise every right and power of, the Company or such Guarantor, as the case
may be, under this Indenture with the same effect as if such successor had been
named as the Company or such Guarantor herein. In the event of any such
conveyance or transfer, the Company or such Guarantor, as the case may be,
68
as the predecessor shall be discharged from all obligations and covenants under
this Indenture and the Securities and may be dissolved, wound up or liquidated
at any time thereafter.
ARTICLE IX
Supplemental Indentures
SECTION 9.01. Supplemental Indentures Without Consent of
Securityholders. Without the consent of the Holders of any Securities, the
Company, when authorized by a Board Resolution, and the Trustee, at any time and
from time to time, may enter into one or more indentures supplemental hereto, in
form satisfactory to the Trustee, for any of the following purposes:
(1) to evidence the succession of another corporation or
Person to the Company or any Guarantor, and the assumption by any such
successor of the respective covenants of the Company or any Guarantor
herein and in the Securities contained; or
(2) to add to the covenants of the Company or any Guarantor,
or to surrender any right or power herein conferred upon the Company or
any Guarantor, for the benefit of the Holders of the Securities of any
or all series (and if such covenants or the surrender of such right or
power are to be for the benefit of less than all series of Securities,
stating that such covenants are expressly being included or such
surrenders are expressly being made solely for the benefit of one or
more specified series); or
(3) to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other provision
herein, or to make any other provisions with respect to matters or
questions arising under this Indenture; or
(4) to add to this Indenture such provisions as may be
expressly permitted by the TIA, excluding, however, the provisions
referred to in Section 316(a)(2) of the TIA as in effect at the date as
of which this instrument was executed or any corresponding provision in
any similar federal statute hereafter enacted; or
(5) to establish any form of Security, as provided
in Article II, to provide for the issuance of any
69
series of Securities as provided in Article III and to set forth the
terms thereof, and/or to add to the rights of the Holders of the
Securities of any series; or
(6) to evidence and provide for the acceptance of appointment
by another corporation as a successor Trustee hereunder with respect to
one or more series of Securities and to add to or change any of the
provisions of this Indenture as shall be necessary to provide for or
facilitate the administration of the trusts hereunder by more than one
Trustee, pursuant to Section 6.11; or
(7) to add any additional Events of Default in respect of the
Securities of any or all series (and if such additional Events of
Default are to be in respect of less than all series of Securities,
stating that such Events of Default are expressly being included solely
for the benefit of one or more specified series); or
(8) to provide for the issuance of Securities in coupon as
well as fully registered form; or
(9) to provide for the terms and conditions of conversion into
Common Stock or other Marketable Securities of the Securities of any
series which are convertible into Common Stock or other Marketable
Securities, if different from those set forth in Article XII; or
(10) to secure the Securities of any series pursuant to
Section 10.06 or otherwise.
No supplemental indenture for the purposes identified in
Clauses (2), (3), (5) or (7) above may be entered into if to do so would
adversely affect the rights of the Holders of Outstanding Securities of any
series in any material respect.
SECTION 9.02. Supplemental Indentures with Consent of
Securityholders. With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities of all series affected by such
supplemental indenture or indentures (acting as one class), by Act of said
Holders delivered to the Company and the Trustee (in accordance with Section
1.04 hereof), the Company, when authorized by a Board Resolution, and the
Trustee may enter into an indenture or indentures supplemental hereto for the
purpose of adding any provisions
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to or changing in any manner or eliminating any of the provisions of this
Indenture or of modifying in any manner the rights of the Holders of the
Securities of each such series under this Indenture; provided, however, that no
such supplemental indenture shall, without the consent of the Holder of each
Outstanding Security affected thereby:
(1) change the Maturity of the principal of, or the Stated
Maturity of any premium on, or any installment of interest on, any
Security, or reduce the principal amount thereof or the interest or any
premium thereon, or change the method of computing the amount of
principal thereof or interest thereon on any date or change any Place
of Payment where, or the coin or currency in which, any Security or any
premium or interest thereon is payable, or impair the right to
institute suit for the enforcement of any such payment on or after the
Maturity or the Stated Maturity, as the case may be, thereof (or, in
the case of redemption or repayment, on or after the Redemption Date or
the Repayment Date, as the case may be), or alter the provisions of
this Indenture so as to affect adversely the terms, if any, of
conversion of any Securities into Common Stock or other securities; or
(2) reduce the percentage in principal amount of the
Outstanding Securities of any series, the consent of whose Holders is
required for any such supplemental indenture, or the consent of whose
Holders is required for any waiver of compliance with certain
provisions of this Indenture or certain defaults hereunder and their
consequences, provided for in this Indenture; or
(3) modify any of the provisions of this Section, Section 5.13
or Section 10.07, except to increase any such percentage or to provide
that certain other provisions of this Indenture cannot be modified or
waived without the consent of the Holder of each Outstanding Security
affected thereby;
(4) impair or adversely affect the right of any Holder to
institute suit for the enforcement of any payment on, or with respect
to, the Securities of any series on or after the Stated Maturity of
such Securities (or in the case of redemption, on or after the
Redemption Date);
(5) amend or modify Section 13.01 of this Indenture in any
manner adverse to the rights of the Holders of the Outstanding
Securities of any series.
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For purposes of this Section 9.02, if the Securities of any
series are issuable upon the exercise of warrants, each holder of an unexercised
and unexpired warrant with respect to such series shall be deemed to be a Holder
of Outstanding Securities of such series in the amount issuable upon the
exercise of such warrant. For such purposes, the ownership of any such warrant
shall be determined by the Company in a manner consistent with customary
commercial practices. The Trustee for such series shall be entitled to rely on
an Officers' Certificate as to the principal amount of Securities of such series
in respect of which consents shall have been executed by holders of such
warrants.
A supplemental indenture which changes or eliminates any
covenant or other provision of this Indenture which has expressly been included
solely for the benefit of one or more particular series of Securities, or which
modifies the rights of the Holders of Securities of such with respect to such
covenant or other provision, shall be deemed not to affect the rights under this
Indenture of Holders of Securities of any other series.
It shall not be necessary for any Act of Securityholders under
this Section to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such Act shall approve the substance
thereof.
SECTION 9.03. Execution of Supplemental Indentures. In
executing, or accepting the additional trusts created by, any supplemental
indenture permitted by this Article or the modifications thereby of the trusts
created by this Indenture, the Trustee shall be entitled to receive, and
(subject to Section 6.01) shall be fully protected in relying upon, an Opinion
of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Trustee may, but shall not be
obligated to, enter into any such supplemental indenture which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.
SECTION 9.04. Effect of Supplemental Indentures. Upon the
execution of any supplemental indenture under this Article, this Indenture shall
be modified in accordance therewith, and such supplemental indenture shall form
a part of this Indenture for all purposes; and every Holder of Securities
theretofore or thereafter authenticated and delivered hereunder shall be bound
thereby to the extent provided therein.
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SECTION 9.05. Conformity with Trust Indenture Act. Every
supplemental indenture executed pursuant to this Article shall conform to the
requirements of TIA as then in effect.
SECTION 9.06. Reference in Securities to Supplemental
Indentures. Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and shall if required by
the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities so modified as to conform, in the opinion of the Trustee and the
Board of Directors, to any such supplemental indenture may be prepared and
executed by the Company and authenticated and delivered by the Trustee in
exchange for Outstanding Securities.
ARTICLE X
Covenants
SECTION 10.01. Payment of Principal, Premium and Interest.
With respect to each series of Securities, the Company will duly and punctually
pay the principal of (and premium, if any) and interest on such Securities in
accordance with their terms and this Indenture, and will duly comply with all
the other terms, agreements and conditions contained in, or made in the
Indenture for the benefit of, the Securities of such series.
SECTION 10.02. Maintenance of Office or Agency. The Company
will maintain an office or agency in each Place of Payment where Securities may
be presented or surrendered for payment, where Securities may be surrendered for
registration of transfer or exchange, where notices and demands to or upon the
Company in respect of the Securities and this Indenture may be served and where
any Securities with conversion privileges may be presented and surrendered for
conversion. The Company will give prompt written notice to the Trustee of the
location, and of any change in the location, of such office or agency. If at any
time the Company shall fail to maintain such office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee, and the Company hereby appoints the Trustee its agent to receive all
such presentations, surrenders, notices and demands.
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Unless otherwise set forth in, or pursuant to, a Board
Resolution or Indenture supplemental hereto with respect to a series of
Securities, the Company hereby initially designates as the Place of Payment for
each series of Securities, the Borough of Manhattan, the City and State of New
York, and initially appoints the Trustee at its Corporate Trust Office as the
Company's office or agency for each such purpose in such city.
SECTION 10.03. Money for Security Payments To Be Held in
Trust. If the Company shall at any time act as its own Paying Agent for any
series of Securities, it will, on or before each due date of the principal of
(and premium, if any) or interest on, any of the Securities of such series,
segregate and hold in trust for the benefit of the Persons entitled thereto a
sum sufficient to pay the principal (and premium, if any) or interest so
becoming due until such sums shall be paid to such Persons or otherwise disposed
of as herein provided, and will promptly notify the Trustee of its action or
failure to act.
Whenever the Company shall have one or more Paying Agents for
any series of Securities, it will, on or prior to each due date of the principal
of (and premium, if any) or interest on, any Securities of such series, deposit
with a Paying Agent a sum sufficient to pay the principal (and premium, if any)
or interest so becoming due, such sum to be held in trust for the benefit of the
Persons entitled to such principal (and premium, if any) or interest, and
(unless such Paying Agent is the Trustee) the Company will promptly notify the
Trustee of its action or failure so to act.
The Company will cause each Paying Agent other than the
Trustee for any series of Securities to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will:
(1) hold all sums held by it for the payment of principal of
(and premium, if any) or interest on Securities of such series in trust
for the benefit of the Persons entitled thereto until such sums shall
be paid to such Persons or otherwise disposed of as herein provided;
(2) give the Trustee notice of any default by the Company (or
any other obligor upon the Securities of such series) in the making of
any such payment of principal (and premium, if any) or interest on the
Securities of such series; and
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(3) at any time during the continuance of any such default,
upon the written request of the Trustee, forthwith pay to the Trustee
all sums so held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture with respect to any series of
Securities or for any other purpose, pay, or by Company Order direct any Paying
Agent to pay, to the Trustee all sums held in trust by the Company or such
Paying Agent in respect of each and every series of Securities as to which it
seeks to discharge this Indenture or, if for any other purpose, all sums so held
in trust by the Company in respect of all Securities, such sums to be held by
the Trustee upon the same trusts as those upon which such sums were held by the
Company or such Paying Agent; and, upon such payment by any Paying Agent to the
Trustee, such Paying Agent shall be released from all further liability with
respect to such money.
Any money deposited with the Trustee or any Paying Agent, or
then held by the Company, in trust for the payment of the principal of (and
premium, if any) or interest on any Security of any series and remaining
unclaimed for two years after such principal (and premium, if any) or interest
has become due and payable shall be paid to the Company on Company Request, or
(if then held by the Company) shall be discharged from such trust; and the
Holder of such Security shall thereafter as an unsecured general creditor, look
only to the Company for payment thereof, and all liability of the Trustee or
such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease. The Trustee or such Paying
Agent, before being required to make any such repayment, may at the expense of
the Company mail to the Holders of the Securities as to which the money to be
repaid was held in trust, as their names and addresses appear in the Security
Register, a notice that such moneys remain unclaimed and that, after a date
specified in the notice, which shall not be less than 30 days from the date on
which the notice was first mailed to the Holders of the Securities as to which
the money to be repaid was held in trust, any unclaimed balance of such moneys
then remaining will be paid to the Company free of the trust formerly impressed
upon it.
SECTION 10.04. Statement as to Compliance. The Company and
each Guarantor will deliver to the Trustee, within 120 days after the end of
each fiscal year, a written statement signed by the principal executive officer,
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principal financial officer or principal accounting officer of the Company or
such Guarantor, as applicable, stating that:
(1) a review of the activities of the Company or such
Guarantor, as applicable, during such year and of performance under
this Indenture and under the terms of the Securities has been made
under his supervision; and
(2) to the best of his knowledge, based on such review, the
Company or such Guarantor, as applicable, has fulfilled all its
obligations under this Indenture and has complied with all conditions
and covenants on its part contained in this Indenture through such
year, or, if there has been a default in the fulfillment of any such
obligation, covenant or condition, specifying each such default known
to him and the nature and status thereof.
For the purpose of this Section 10.04, default and compliance
shall be determined without regard to any grace period or requirement of notice
provided pursuant to the terms of this Indenture.
SECTION 10.05. Legal Existence. Subject to Article VIII the
Company will do or cause to be done all things necessary to preserve and keep in
full force and effect its legal existence.
SECTION 10.06. Limitation on Liens. Neither the Company nor
any Material Subsidiary of the Company shall incur, create, issue, assume,
guarantee or otherwise become liable for any indebtedness for money borrowed
that is secured by a lien on any asset now owned or hereafter acquired by it
unless the Company makes or causes to be made effective provisions whereby the
Securities issued under this Indenture will be secured by such lien equally and
ratably with (or prior to) all other indebtedness thereby secured so long as any
such indebtedness shall be secured. The foregoing restriction does not apply to
the following:
(i) liens existing as of the date this Indenture;
(ii) liens created by Subsidiaries of the Company to secure
indebtedness of such Subsidiaries to the Company or to one or more
other Subsidiaries of the Company;
(iii) liens affecting property of a Person existing at the
time it becomes a Subsidiary of the Company or at the time it merges
into or consolidates
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with the Company or a Subsidiary of the Company or at the time of a
sale, lease or other disposition of all or substantially all of the
properties of such Person to the Company or its Subsidiaries;
(iv) liens on property existing at the time of the acquisition
thereof or incurred to secure payment of all or a part of the purchase
price thereof or to secure indebtedness incurred prior to, at the time
of, or within 18 months after the acquisition thereof for the purpose
of financing all or part of the purchase price thereof;
(v) liens on any property to secure all or part of the cost of
improvements or construction thereon or indebtedness incurred to
provide funds for such purpose in a principal amount not exceeding the
cost of such improvements or construction;
(vi) liens consisting of or relating to the sale, transfer or
financing of motion pictures, video and television programs, sound
recordings, books or rights with respect thereto to or with so-called
tax shelter groups or other third-party investors in connection with
the financing of such motion pictures, video and television
programming, sound recordings or books in the ordinary course of
business and the granting to the Company or any of its Subsidiaries of
rights to distribute such motion pictures, video and television
programming, sound recordings or books; provided, however, that no such
lien shall attach to any asset or right of the Company or its
Subsidiaries (other than (1) the motion pictures, video and television
programming, sound recordings, books or rights which were sold,
transferred to or financed by the tax shelter group or third-party
investors in question or the proceeds arising therefrom and (2) the
stock or other equity interests of a Subsidiary substantially all of
the assets of which consist of such motion pictures, video and
television programming, sound recordings, books or rights and related
proceeds);
(vii) liens on shares of stock, indebtedness or other
securities of a Person that is not a Subsidiary of the Company;
(viii) liens on Works which either (1) existed in such Works
before the time of their acquisition and were not created in
anticipation thereof, or (2) were created solely for the purpose of
securing obligations to financiers, producers, distributors,
exhibitors,
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completion guarantors, inventors, copyright holders, financial
institutions or other participants incurred in the ordinary course of
business in connection with the acquisition, financing, production,
completion, distribution or exhibition of Works;
(ix) any lien on the office building and hotel complex located
in Atlanta, Georgia known as the CNN Center Complex, including the
parking decks for such complex (to the extent such parking decks are
owned or leased by the Company or its Subsidiaries), or any portion
thereof and all property rights therein and the products, revenues and
proceeds therefrom created as part of any mortgage financing or
sale-leaseback of the CNN Center Complex;
(x) liens on satellite transponders and all property rights
therein and the products, revenues and proceeds therefrom which secure
obligations incurred in connection with the acquisition, utilization or
operation of such satellite transponders or the refinancing of any such
obligations;
(xi) restrictions on the Atlanta National League Baseball
Club, Inc., Atlanta Hawks, Ltd. and the Atlanta Hockey Club, Inc. and
their respective assets imposed by Major League Baseball or the
Commissioner of Baseball, the National Basketball Association and the
National Hockey League, respectively, including, without limitation,
restrictions on the transferability of the Company's or any of its
Subsidiary's interests therein;
(xii) liens on capital leases entered into after the date of
this Indenture provided that such liens extend only to the property or
assets that are the subject of such capital leases;
(xiii) liens resulting from progress payments or partial
payments under United States government contracts or subcontracts;
(xiv) any extensions, renewal or replacement of any lien
referred to in the foregoing clauses (i) through (xiii) inclusive, or
of any indebtedness secured thereby; provided, however, that the
principal amount of indebtedness secured thereby shall not exceed the
principal amount of indebtedness so secured at the time of such
extension, renewal or replacement, or at the time the lien was issued,
created or assumed or otherwise permitted, and that such extension,
renewal
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or replacement lien shall be limited to all or part of substantially
the same property which secured the lien extended, renewed or replaced
(plus improvements on such property); and
(xv) other liens arising in connection with indebtedness of
the Company and its Subsidiaries in an aggregate principal amount for
the Company and its Subsidiaries not exceeding at the time such lien is
issued, created or assumed the greater of (A) 15% of the Consolidated
Net Worth of the Company and (B) $500 million.
SECTION 10.07. Waiver of Certain Covenants. The Company may
omit in respect of any series of Securities, in any particular instance, to
comply with any covenant or condition set forth in Sections 10.05 or 10.06 or
set forth in a Board Resolution or supplemental indenture with respect to the
Securities of such series, unless otherwise specified in such Board Resolution
or supplemental indenture, if before or after the time for such compliance the
Holders of not less than a majority in principal amount of the Outstanding
Securities of all series affected by such waiver (voting as one class) shall, by
Act of such Securityholders delivered to the Company and the Trustee (in
accordance with Section 1.04 hereof), either waive such compliance in such
instance or generally waive compliance with such covenant or condition, but no
such waiver shall extend to or affect such covenant or condition except to the
extent so expressly waived, and, until such waiver shall become effective, the
obligations of the Company and the duties of the Trustee in respect of any such
covenant or condition shall remain in full force and effect. Nothing in this
Section 10.07 shall permit the waiver of compliance with any covenant or
condition set forth in such Board Resolution or supplemental indenture which, if
in the form of an indenture supplemental hereto, would not be permitted by
Section 9.02 without the consent of the Holder of each Outstanding Security
affected thereby.
ARTICLE XI
Redemption of Securities
SECTION 11.01. Applicability of Article. The Company may
reserve the right to redeem and pay before Stated Maturity all or any part of
the Securities of any series, either by optional redemption, sinking or purchase
fund or analogous obligation or otherwise, by provision therefor in the form of
Security for such series established and approved pursuant to Section 2.02 and
on such terms as
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are specified in such form or in the indenture supplemental hereto with respect
to Securities of such series as provided in Section 3.01. Redemption of
Securities of any series shall be made in accordance with the terms of such
Securities and, to the extent that this Article does not conflict with such
terns, the succeeding Sections of this Article. Notwithstanding anything to the
contrary in this Indenture, except in the case of redemption pursuant to a
sinking fund, the Trustee shall not make any payment in connection with the
redemption of Securities until the close of business on the Redemption Date.
SECTION 11.02. Election To Redeem; Notice to Trustee. The
election of the Company to redeem any Securities redeemable at the election of
the Company shall be evidenced by, or pursuant to authority granted by, a Board
Resolution. In case of any redemption at the election of the Company of less
than all of the Securities of any series, the Company shall, at least 45 days
prior to the Redemption Date fixed by the Company (unless a shorter notice shall
be satisfactory to the Trustee), notify the Trustee of such Redemption Date and
of the principal amount of Securities of such series and the Tranche (as defined
in Section 11.03) to be redeemed.
In the case of any redemption of Securities (i) prior to the
expiration of any restriction on such redemption provided in the terms of such
Securities or elsewhere in this Indenture, or (ii) pursuant to an election of
the Company which is subject to a condition specified in the terms of such
Securities, the Company shall furnish the Trustee with an Officers' Certificate
evidencing compliance with such restriction or condition.
SECTION 11.03. Selection by Trustee of Securities To Be
Redeemed. If less than all the Securities of like tenor and terms of any series
(a "Tranche") are to be redeemed, the particular Securities to be redeemed shall
be selected not more than 45 days prior to the Redemption Date by the Trustee,
from the Outstanding Securities of such Tranche not previously called for
redemption, by such method as the Trustee shall deem fair and appropriate and
which may include provision for the selection for redemption of portions of the
principal of Securities of such Tranche of a denomination larger than the
minimum authorized denomination for Securities of that series. Unless otherwise
provided in the terms of a particular series of Securities, the portions of the
principal of Securities so selected for partial redemption shall be equal to the
minimum authorized denomination of the Securities of such series, or an integral
multiple thereof, and the principal amount which
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remains outstanding shall not be less than the minimum authorized denomination
for Securities of such series. If less than all the Securities of unlike tenor
and terms of a series are to be redeemed, the particular Tranche of Securities
to be redeemed shall be selected by the Company.
If any convertible Security selected for partial redemption is
converted in part before the termination of the conversion right with respect to
the portion of the Security so selected, the converted portion of such Security
shall be deemed (so far as may be) to be the portion selected for redemption.
Upon any redemption of fewer than all the Securities of a
series or Tranche, the Company and the Trustee may treat as Outstanding any
Securities surrendered for conversion during the period of fifteen days next
preceding the mailing of a notice of redemption, and need not treat as
Outstanding any Security authenticated and delivered during such period in
exchange for the unconverted portion of any Security converted in part during
such period.
The Trustee shall promptly notify the Company in writing of
the Securities selected for redemption and, in the case of any Security selected
for partial redemption, the principal amount thereof to be redeemed.
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 45 days prior to the Redemption Date as being owned of
record and beneficially by, and not pledged or hypothecated by either, (a) the
Company or (b) an entity specifically identified in such written statement as
being an Affiliate of the Company.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Securities
shall relate, in the case of any Security redeemed or to be redeemed only in
part, to the portion of the principal of such Security which has been or is to
be redeemed.
SECTION 11.04. Notice of Redemption. Notice of redemption
shall be given by first-class mail, postage prepaid, mailed not less than 15
(unless otherwise provided in the Board Resolution establishing the relevant
series) nor more than 45 days prior to the Redemption Date, to each
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holder of Securities to be redeemed, at his address appearing in the Security
Register.
All notices of redemption shall state:
(1) the Redemption Date;
(2) the Redemption Price;
(3) if less than all Outstanding Securities of any series are
to be redeemed, the identification (and, in the case of partial
redemption, the respective principal amounts) of the Securities to be
redeemed;
(4) that on the Redemption Date the Redemption Price will
become due and payable upon each such Security, and that interest, if
any, thereon shall cease to accrue from and after said date;
(5) the place where such Securities are to be surrendered for
payment of the Redemption Price, which shall be the office or agency of
the Company in the Place of Payment;
(6) that the redemption is on account of a sinking
or purchase fund, or other analogous obligation, if
that be the case;
(7) if such Securities are convertible into Common Stock or
other securities, the Conversion Price or other conversion price and
the date on which the right to convert such Securities into Common
Stock or other securities will terminate; and
(8) if applicable, that the redemption may be rescinded by the
Company, at its sole option, pursuant to Section 11.09 of this
Indenture upon the occurrence of a Redemption Rescission Event.
Notice of redemption of Securities to be redeemed at the
election of the Company shall be given by the Company or, at the Company's
request, by the Trustee in the name and at the expense of the Company.
SECTION 11.05. Deposit of Redemption Price. On or prior to any
Redemption Date and subject to Section 11.09, the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 10.03) an amount of
money sufficient to pay the Redemption Price of all the Securities which are to
be
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redeemed on that date. If any Security to be redeemed is converted into Common
Stock or other securities, any money so deposited with the Trustee or a Paying
Agent shall be paid to the Company upon Company Request or, if then so
segregated and held in trust by the Company, shall be discharged from such
trust.
SECTION 11.06. Securities Payable on Redemption Date. Notice
of redemption having been given as aforesaid, the Securities so to be redeemed
shall, subject to Section 11.09, on the Redemption Date, become due and payable
at the Redemption Price therein specified and from and after such date (unless
the Company shall default in the payment of the Redemption Price) such
Securities shall cease to bear interest and any rights to convert such
Securities shall terminate. Upon surrender of such Securities for redemption in
accordance with the notice and subject to Section 11.09, such Securities shall
be paid by the Company at the Redemption Price. Unless otherwise provided with
respect to such Securities pursuant to Section 3.01, installments of interest
the Stated Maturity of which is on or prior to the Redemption Date shall be
payable to the Holders of such Securities registered as such on the relevant
Regular Record Dates according to their terms and the provisions of Section
3.07.
If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal shall, until paid, bear
interest from the Redemption Date at the rate borne by the Security, or as
otherwise provided in such Security.
SECTION 11.07. Securities Redeemed in Part. Any Security which
is to be redeemed only in part shall be surrendered at the office or agency of
the Company in the Place of Payment with respect to that series (with, if the
Company or the Trustee so requires, due endorsement by, or a written instrument
of transfer in form satisfactory to the Company and the Trustee duly executed
by, the Holder thereof or his attorney duly authorized in writing) and the
Company shall execute and the Trustee shall authenticate and deliver to the
Holder of such Security without service charge, a new Security or Securities of
the same series and Stated Maturity and of like tenor and terms, of any
authorized denomination as requested by such Holder in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of
the Security so surrendered.
SECTION 11.08. Provisions with Respect to Any Sinking Funds.
Unless the form or terms of any series of Securities shall provide otherwise, in
lieu of making all or
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any part of any mandatory sinking fund payment with respect to such series of
Securities in cash, the Company may at its option (1) deliver to the Trustee for
cancelation any Securities of such series theretofore acquired by the Company or
converted by the Holder thereof into Common Stock or other securities, or (2)
receive credit for any Securities of such series (not previously so credited)
acquired by the Company (including by way of optional redemption (pursuant to
the sinking fund or otherwise but not by way of mandatory sinking fund
redemption) or converted by the Holder thereof into Common Stock or other
securities and theretofore delivered to the Trustee for cancelation, and if it
does so then (i) Securities so delivered or credited shall be credited at the
applicable sinking fund Redemption Price with respect to Securities of such
series, and (ii) on or before the 60th day next preceding each sinking fund
Redemption Date with respect to such series of Securities, the Company will
deliver to the Trustee (A) an Officers' Certificate specifying the portions of
such sinking fund payment to be satisfied by payment of cash and by delivery or
credit of Securities of such series acquired by the Company or converted by the
Holder thereof, and (B) such Securities, to the extent not previously
surrendered. Such Officers' Certificate shall also state the basis for such
credit and that the Securities for which the Company elects to receive credit
have not been previously so credited and were not acquired by the Company
through operation of the mandatory sinking fund, if any, provided with respect
to such Securities and shall also state that no Event of Default with respect to
Securities of such series has occurred and is continuing. All Securities so
delivered to the Trustee shall be canceled by the Trustee and no Securities
shall be authenticated in lieu thereof.
If the sinking fund payment or payments (mandatory or
optional) with respect to any series of Securities made in cash plus any unused
balance of any preceding sinking fund payments with respect to Securities of
such series made in cash shall exceed $50,000 (or a lesser sum if the Company
shall so request), unless otherwise provided by the terms of such series of
Securities, that cash shall be applied by the Trustee on the sinking fund
Redemption Date with respect to Securities of such series next following the
date of such payment to the redemption of Securities of such series at the
applicable sinking fund Redemption Price with respect to Securities of such
series, together with accrued interest, if any, to the date fixed for
redemption, with the effect provided in Section 11.06. The Trustee shall select,
in the manner provided in Section 11.03, for redemption on such sinking fund
Redemption Date a sufficient principal amount of Securities of such series to
utilize that cash and shall
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thereupon cause notice of redemption of the Securities of such series for the
sinking fund to be given in the manner provided in Section 11.04 (and with the
effect provided in Section 11.06) for the redemption of Securities in part at
the option of the Company. Any sinking fund moneys not so applied or allocated
by the Trustee to the redemption of Securities of such series shall be added to
the next cash sinking fund payment with respect to Securities of such series
received by the Trustee and, together with such payment, shall be applied in
accordance with the provisions of this Section 11.08. Any and all sinking fund
moneys with respect to Securities of any series held by the Trustee at the
Maturity of Securities of such series, and not held for the payment or
redemption of particular Securities of such series, shall be applied by the
Trustee, together with other moneys, if necessary, to be deposited sufficient
for the purpose, to the payment of the principal of the Securities of such
series at Maturity.
On or before each sinking fund Redemption Date provided with
respect to Securities of any series, the Company shall pay to the Trustee in
cash a sum equal to all accrued interest, if any, to the date fixed for
redemption on Securities to be redeemed on such sinking fund Redemption Date
pursuant to this Section 11.08.
SECTION 11.09. Rescission of Redemption. In the event that
this Section 11.09 is specified to be applicable to a series of Securities
pursuant to Section 3.01 and a Redemption Rescission Event shall occur following
any day on which a notice of redemption shall have been given pursuant to
Section 11.04 hereof but at or prior to the time and date fixed for redemption
as set forth in such notice of redemption, the Company may, at its sole option,
at any time prior to the earlier of (i) the close of business on that day which
is two Trading Days following such Redemption Rescission Event and (ii) the time
and date fixed for redemption as set forth in such notice, rescind the
redemption to which such notice of redemption shall have related by making a
public announcement of such rescission (the date on which such public
announcement shall have been made being hereinafter referred to as the
"Rescission Date"). The Company shall be deemed to have made such announcement
if it shall issue a release to the Dow ▇▇▇▇▇ New Service, Reuters Information
Services or any successor news wire service. From and after the making of such
announcement, the Company shall have no obligation to redeem Securities called
for redemption pursuant to such notice of redemption or to pay the Redemption
Price therefor and all rights of Holders of Securities shall be restored as if
such notice of redemption had not been given. As promptly as
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practicable following the making of such announcement, the Company shall
telephonically notify the Trustee and the Paying Agent of such rescission. The
Company shall give notice of any such rescission by first-class mail, postage
prepaid, mailed as promptly as practicable but in no event later than the close
of business on that day which is five Trading Days following the Rescission Date
to each Holder of Securities at the close of business on the Rescission Date, to
any other Person that was a Holder of Securities and that shall have surrendered
Securities for conversion following the giving of notice of the subsequently
rescinded redemption and to the Trustee and the Paying Agent. Each notice of
rescission shall (w) state that the redemption described in the notice of
redemption has been rescinded, (x) state that any Converting Holder shall be
entitled to rescind the conversion of Securities surrendered for conversion
following the day on which notice of redemption was given but on or prior to the
date of the mailing of the Company's notice of rescission, (y) be accompanied by
a form prescribed by the Company to be used by any Converting Holder rescinding
the conversion of Securities so surrendered for conversion (and instructions for
the completion and delivery of such form, including instructions with respect to
any payment that may be required to accompany such delivery) and (z) state that
such form must be properly completed and received by the Company no later than
the close of business on a date that shall be 15 Trading Days following the
date of the mailing of such notice of rescission.
ARTICLE XII
Conversion
SECTION 12.01. Conversion Privilege. In the event that this
Article XII is specified to be applicable to a series of Securities pursuant to
Section 3.01, the Holder of a Security of such series shall have the right, at
such Holder's option, to convert, in accordance with the terms of such series of
Securities and this Article XII, all or any part (in a denomination of, unless
otherwise specified in a Board Resolution or supplemental indenture with Respect
to Securities of such series, $1,000 in principal amount or any integral
multiple thereof) of such Security into shares of Common Stock or other
Marketable Securities specified in such Board Resolution at any time or, as to
any Securities called for redemption, at any time prior to the time and date
fixed for such redemption (unless the Company shall default in the payment of
the Redemption Price, in which case such right shall not terminate at such time
and date).
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SECTION 12.02. Conversion Procedure; Rescission of Conversion;
Conversion Price; Fractional Shares. (a) Each Security to which this Article is
applicable shall be convertible at the office of the Conversion Agent, and at
such other place or places, if any, specified in a Board Resolution with respect
to the Securities of such series, into fully paid and nonassessable shares
(calculated to the nearest 1/100th of a share) of Common Stock or other
Marketable Securities. The Securities will be converted into shares of Common
Stock or such other Marketable Securities at the Conversion Price therefor. No
payment or adjustment shall be made in respect of dividends on the Common Stock
or such other Marketable Securities, or accrued interest on a converted Security
except as described in Section 12.09. The Company may, but shall not be
required, in connection with any conversion of Securities, to issue a fraction
of a share of Common Stock or of such other Marketable Security, and, if the
Company shall determine not to issue any such fraction, the Company shall,
subject to Section 12.03(4), make a cash payment (calculated to the nearest
cent) equal to such fraction multiplied by the Closing Price of the Common Stock
or such other Marketable Security on the last Trading Day prior to the date of
conversion.
(b) Before any Holder of a Security shall be entitled to
convert the same into Common Stock or other Marketable Securities, such Holder
shall surrender such Security duly endorsed to the Company or in blank, at the
office of the Conversion Agent or at such other place or places, if any,
specified in a Board Resolution with respect to the Securities of such series,
and shall give written notice to the Company at said office or place that he
elects to convert the same and shall state in writing therein the principal
amount of Securities to be converted and the name or names (with addresses) in
which he wishes the certificate or certificates for Common Stock or for such
other Marketable Securities to be issued; provided, however, that no Security or
portion thereof shall be accepted for conversion unless the principal amount of
such Security or such portion, when added to the principal amount of all other
Securities or portions thereof then being surrendered by the Holder thereof for
conversion, exceeds the then effective Conversion Price with respect thereto. If
more than one Security shall be surrendered for conversion at one time by the
same Holder, the number of full shares of Common Stock or such other Marketable
Securities which shall be deliverable upon conversion shall be computed on the
basis of the aggregate principal amount of the Securities (or specified portions
thereof to the extent permitted thereby) so surrendered. Subject to the next
succeeding sentence,
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the Company will, as soon as practicable thereafter, issue and deliver at said
office or place to such Holder of a Security, or to his nominee or nominees,
certificates for the number of full shares of Common Stock or other Marketable
Security to which he shall be entitled as aforesaid, together, subject to the
last sentence of paragraph (a) above, with cash in lieu of any fraction of a
share to which he would otherwise be entitled. The Company shall not be required
to deliver certificates for shares of Common Stock or other Marketable
Securities while the stock transfer books for such stock or the transfer books
for such Marketable Securities, as the case may be, or the Security Register are
duly closed for any purpose, but certificates for shares of Common Stock or
other Marketable Securities shall be issued and delivered as soon as practicable
after the opening of such books or Security Register. A Security shall be deemed
to have been converted as of the close of business on the date of the surrender
of such Security for conversion as provided above, and the person or persons
entitled to receive the Common Stock or other Marketable Securities issuable
upon such conversion shall be treated for all purposes as the record Holder or
Holders of such Common Stock or other Marketable Securities as of the close of
business on such date. In case any Security shall be surrendered for partial
conversion, the Company shall execute and the Trustee shall authenticate and
deliver to or upon the written order of the Holder of the Securities so
surrendered, without charge to such Holder (subject to the provisions of Section
12.08), a new Security or Securities in authorized denominations in an aggregate
principal amount equal to the unconverted portion of the surrendered Security.
(c) Notwithstanding anything to the contrary contained herein,
in the event the Company shall have rescinded a redemption of Securities
pursuant to Section 11.09 hereof, any Holder of Securities that shall have
surrendered Securities for conversion following the day on which notice of the
subsequently rescinded redemption shall have been given but prior to the later
of (a) the close of business on the Trading Day next succeeding the date on
which public announcement of the rescission of such redemption shall have been
made and (b) the date of the mailing of the notice of rescission required by
Section 11.09 hereof (a "Converting Holder") may rescind the conversion of such
Securities surrendered for conversion by (i) properly completing a form
prescribed by the Company and mailed to Holders of Securities (including
Converting Holders) with the Company's notice of rescission, which form shall
provide for the certification by any Converting Holder rescinding a conversion
on behalf of any beneficial owner
88
(within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934) of
Securities that the beneficial ownership (within the meaning of such Rule) of
such Securities shall not have changed from the date on which such Securities
were surrendered for conversion to the date of such certification and (ii)
delivering such form to the Company no later than the close of business on that
date which is fifteen Trading Days following the date of the mailing of the
Company's notice of rescission. The delivery of such form by a Converting Holder
shall be accompanied by (x) any certificates representing shares of Common Stock
or other securities issued to such Converting Holder upon a conversion of
Securities that shall be rescinded by the proper delivery of such form (the
"Surrendered Securities"), (y) any securities, evidences of indebtedness or
assets (other than cash) distributed by the Company to such Converting Holder by
reason of such Converting Holder being a record holder of Surrendered Securities
and (z) payment in New York Clearing House funds or other funds acceptable to
the Company of an amount equal to the sum of (I) any cash such Converting Holder
may have received in lieu of the issuance of fractional Surrendered Securities
and (II) any cash paid or payable by the Company to such Converting Holder by
reason of such Converting Holder being a record holder of Surrendered
Securities. Upon receipt by the Company of any such form properly completed by a
Converting Holder and any certificates, securities, evidences of indebtedness,
assets or cash payments required to be returned by such Converting Holder to the
Company as set forth above, the Company shall instruct the transfer agent or
agents for shares of Common Stock or other securities to cancel any certificates
representing Surrendered Securities (which Surrendered Securities shall be
deposited in the treasury of the Company) and shall instruct the Registrar to
reissue certificates representing Securities to such Converting Holder (which
Securities shall be deemed to have been outstanding at all times during the
period following their surrender for conversion). The Company shall, as promptly
as practicable, and in no event more than five Trading Days following the
receipt of any such properly completed form and any such certificates,
securities, evidences of indebtedness, assets or cash payments required to be so
returned, pay to the Holder of Securities surrendered to the Company pursuant to
a rescinded conversion or as otherwise directed by such Holder any interest paid
or other payment made to Holders of Securities during the period from the time
such Securities shall have been surrendered for conversion to the rescission of
such conversion. All questions as to the validity, form, eligibility (including
time of receipt) and acceptance of any form submitted to the Company to rescind
the conversion
89
of Securities, including questions as to the proper completion or execution of
any such form or any certification contained therein, shall be resolved by the
Company, whose determination shall be final and binding.
SECTION 12.03. Adjustment of Conversion Price for Common Stock
or Marketable Securities. The Conversion Price with respect to any Security
which is convertible into Common Stock or other Marketable Securities shall be
adjusted from time to time as follows:
(1) In case the Company shall, at any time or from time to
time while any of such Securities are outstanding, (i) pay a dividend
in shares of its Common Stock or other Marketable Securities, (ii)
combine its outstanding shares of Common Stock or other Marketable
Securities into a smaller number of shares or securities, (iii)
subdivide its outstanding shares of Common Stock or other Marketable
Securities or (iv) issue by reclassification of its shares of Common
Stock or other Marketable Securities any shares of stock or other
Marketable Securities of the Company, then the Conversion Price in
effect immediately before such action shall be adjusted so that the
Holders of such Securities, upon conversion thereof into Common Stock
or other Marketable Securities immediately following such event, shall
be entitled to receive the kind and amount of shares of capital stock
of the Company or other Marketable Securities which they would have
owned or been entitled to receive upon or by reason of such event if
such Securities had been converted immediately before the record date
(or, if no record date, the effective date) for such event. An
adjustment made pursuant to this Section 12.03(1) shall become
effective retroactively immediately after the record date in the case
of a dividend or distribution and shall become effective retroactively
immediately after the effective date in the case of a subdivision,
combination or reclassification. For the purposes of this Section
12.03(1), each Holder of Securities shall be deemed to have failed to
exercise any right to elect the kind or amount of securities receivable
upon the payment of any such dividend, subdivision, combination or
reclassification (provided that if the kind or amount of securities
receivable upon such dividend, subdivision, combination or
reclassification is not the same for each nonelecting share, then the
kind and amount of securities or other property receivable upon such
dividend, subdivision, combination or reclassification for each
nonelecting share shall be
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deemed to be the kind and amount so receivable per share by a plurality
of the nonelecting shares).
(2) In case the Company shall, at any time or from time to
time while any of such Securities are outstanding, issue rights or
warrants to all holders of shares of its Common Stock or other
Marketable Securities entitling them (for a period expiring within 45
days after the record date for such issuance) to subscribe for or
purchase shares of Common Stock or other Marketable Securities (or
securities convertible into shares of Common Stock or other Marketable
Securities) at a price per share less than the Current Market Price of
the Common Stock or other Marketable Securities at such record date
(treating the price per share of the securities convertible into Common
Stock or other Marketable Securities as equal to (x) the sum of (i) the
price for a unit of the security convertible into Common Stock or other
Marketable Securities plus (ii) any additional consideration initially
payable upon the conversion of such security into Common Stock or other
Marketable Securities divided by (y) the number of shares of Common
Stock or other Marketable Securities initially underlying such
convertible security), the Conversion Price with respect to such
Securities shall be adjusted so that it shall equal the price
determined by dividing the Conversion Price in effect immediately prior
to the date of issuance of such rights or warrants by a fraction, the
numerator of which shall be the number of shares of Common Stock or
other Marketable Securities outstanding on the date of issuance of such
rights or warrants plus the number of additional shares of Common Stock
or other Marketable Securities offered for subscription or purchase (or
into which the convertible securities so offered are initially
convertible), and the denominator of which shall be the number of
shares of Common Stock or other Marketable Securities outstanding on
the date of issuance of such rights or warrants plus the number of
shares or securities which the aggregate offering price of the total
number of shares or securities so offered for subscription or purchase
(or the aggregate purchase price of the convertible securities so
offered plus the aggregate amount of any additional consideration
initially payable upon conversion of such Securities into Common Stock
or other Marketable Securities) would purchase at such Current Market
Price of the Common Stock or other Marketable Securities. Such
adjustment shall become effective retroactively immediately after the
record date for the determination of stockholders entitled to receive
such rights or warrants.
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(3) In case the Company shall, at any time or from time to
time while any of such Securities are outstanding, distribute to all
holders of shares of its Common Stock or other Marketable Securities
(including any such distribution made in connection with a
consolidation or merger in which the Company is the continuing
corporation and the Common Stock or other Marketable Securities are not
changed or exchanged) cash, evidences of its indebtedness, securities
or assets (excluding (i) regular periodic cash dividends in amounts, if
any, determined from time to time by the Board of Directors, (ii)
dividends payable in shares of Common Stock or other Marketable
Securities for which adjustment is made under Section 12.03(1) or (iii)
rights or warrants to subscribe for or purchase securities of the
Company (excluding those referred to in Section 12.03(2)), then in each
such case the Conversion Price with respect to such Securities shall be
adjusted so that it shall equal the price determined by dividing the
Conversion Price in effect immediately prior to the date of such
distribution by a fraction, the numerator of which shall be the Current
Market Price of the Common Stock or other Marketable Securities on the
record date referred to below, and the denominator of which shall be
such Current Market Price of the Common Stock or other Marketable
Securities less the then fair market value (as determined by the Board
of Directors of the Company, whose determination shall be conclusive)
of the portion of the cash or assets or evidences of indebtedness or
securities so distributed or of such subscription rights or warrants
applicable to one share of Common Stock or one other Marketable
Security (provided that such denominator shall never be less than 1.0);
provided, however, that no adjustment shall be made with respect to any
distribution of rights to purchase securities of the Company if a
Holder of Securities would otherwise be entitled to receive such rights
upon conversion at any time of such Securities into Common Stock or
other Marketable Securities unless such rights are subsequently
redeemed by the Company, in which case such redemption shall be treated
for purposes of this Section as a dividend on the Common Stock or other
Marketable Securities. Such adjustment shall become effective
retroactively immediately after the record date for the determination
of stockholders or holders of Marketable Securities entitled to receive
such distribution; and in the event that such distribution is not so
made, the Conversion Price shall again be adjusted to the Conversion
Price which would then be in effect if such record date had not been
fixed.
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(4) The Company shall be entitled to make such additional
adjustments in the Conversion Price, in addition to those required by
subsections 12.03(1), 12.03(2) and 12.03(3), as shall be necessary in
order that any dividend or distribution of Common Stock or other
Marketable Securities, any subdivision, reclassification or combination
of shares of Common Stock or other Marketable Securities or any
issuance of rights or warrants referred to above shall not be taxable
to the holders of Common Stock or other Marketable Securities for
United States Federal income tax purposes.
(5) In any case in which this Section 12.03 shall require that
any adjustment be made effective as of or retroactively immediately
following a record date, the Company may elect to defer (but only for
five (5) Trading Days following the filing of the statement referred to
in Section 12.05) issuing to the Holder of any Securities converted
after such record date the shares of Common Stock and other capital
stock of the Company or other Marketable Securities issuable upon such
conversion over and above the shares of Common Stock and other capital
stock of the Company or other Marketable Securities issuable upon such
conversion on the basis of the Conversion Price prior to adjustment;
provided, however, that the Company shall deliver to such Holder a due
▇▇▇▇ or other appropriate instrument evidencing such Holder's right to
receive such additional shares upon the occurrence of the event
requiring such adjustment.
(6) All calculations under this Section 12.03 shall be made to
the nearest cent or one-hundredth of a share or security, with one-half
cent and .005 of a share, respectively, being rounded upward.
Notwithstanding any other provision of this Section 12.03, the Company
shall not be required to make any adjustment of the Conversion Price
unless such adjustment would require an increase or decrease of at
least 1% of such price. Any lesser adjustment shall be carried forward
and shall be made at the time of and together with the next subsequent
adjustment which, together with any adjustment or adjustments so
carried forward, shall amount to an increase or decrease of at least 1%
in such price. Any adjustments under this Section 12.03 shall be made
successively whenever an event requiring such an adjustment occurs.
(7) In the event that at any time, as a result of an
adjustment made pursuant to this Section 12.03, the
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Holder of any Security thereafter surrendered for conversion shall
become entitled to receive any shares of stock of or other Marketable
Securities of the Company other than shares of Common Stock or
Marketable Securities into which the Securities originally were
convertible, the Conversion Price of such other shares or Marketable
Securities so receivable upon conversion of any such Security shall be
subject to adjustment from time to time in a manner and on terms as
nearly equivalent as practicable to the provisions with respect to
Common Stock and Marketable Securities contained in subparagraphs (1)
through (6) of this Section 12.03, and the provision of Sections 12.01,
12.02 and 12.04 through 12.09 with respect to the Common Stock or other
Marketable Securities shall apply on like or similar terms to any such
other shares or Marketable Securities and the determination of the
Board of Directors as to any such adjustment shall be conclusive.
(8) No adjustment shall be made pursuant to this Section (i)
if the effect thereof would be to reduce the Conversion Price below the
par value (if any) of the Common Stock or other Marketable Security, if
any, or (ii) subject to 12.03(5) hereof, with respect to any Security
that is converted prior to the time such adjustment otherwise would be
made.
SECTION 12.04. Consolidation or Merger of the Company. In case
of either (a) any consolidation or merger to which the Company is a party, other
than a merger or consolidation in which the Company is the surviving or
continuing corporation and which does not result in a reclassification of, or
change (other than a change in par value or from par value to no par value or
from no par value to par value, as a result of a subdivision or combination) in,
outstanding shares of Common Stock or other Marketable Securities or (b) any
sale or conveyance of all or substantially all of the property and assets of the
Company to another Person, then each Security then Outstanding shall be
convertible from and after such merger, consolidation, sale or conveyance of
property and assets into the kind and amount of shares of stock or other
securities and property (including cash) receivable upon such consolidation,
merger, sale or conveyance by a holder of the number of shares of Common Stock
or other Marketable Securities into which such Securities would have been
converted immediately prior to such consolidation, merger, sale or conveyance,
subject to adjustments which shall be as nearly equivalent as may be practicable
to the adjustments provided for in this Article XII (and assuming such holder of
Common Stock or
94
other Marketable Securities failed to exercise his rights of election, if any,
as to the kind or amount of securities, cash or other property (including cash)
receivable upon such consolidation, merger, sale or conveyance (provided that,
if the kind or amount of securities, cash or other property (including cash)
receivable upon such consolidation, merger, sale or conveyance is not the same
for each nonelecting share, then the kind and amount of securities, cash or
other property (including cash) receivable upon such consolidation, merger, sale
or conveyance for each nonelecting share, shall be deemed to be the kind and
amount so receivable per share by a plurality of the nonelecting shares or
securities)). The Company shall not enter into any of the transactions referred
to in clause (a) or (b) of the preceding sentence unless effective provision
shall be made so as to give effect to the provisions set forth in this Section
12.04. The provisions of this Section 12.04 shall apply similarly to successive
consolidations, mergers, sales or conveyances.
SECTION 12.05. Notice of Adjustment. Whenever an adjustment in
the Conversion Price with respect to a series of Securities is required:
(1) the Company shall forthwith place on file with the Trustee
and any Conversion Agent for such Securities a certificate of the
Treasurer of the Company, stating the adjusted Conversion Price
determined as provided herein and setting forth in reasonable detail
such facts as shall be necessary to show the reason for and the manner
of computing such adjustment, such certificate to be conclusive
evidence that the adjustment is correct; and
(2) a notice stating that the Conversion Price has been
adjusted and setting forth the adjusted Conversion Price shall
forthwith be mailed, first class postage prepaid, by the Company to the
Holders of record of such Outstanding Securities.
SECTION 12.06. Notice in Certain Events. In case:
(1) of a consolidation or merger to which the Company is a
party and for which approval of any stockholders of the Company is
required, or of the sale or conveyance to another person or entity or
group of persons or entities acting in concert as a partnership,
limited partnership, syndicate or other group (within the meaning of
Rule 13d-3 under the Securities Exchange
95
Act of 1934) of all or substantially all of the property and assets of
the Company; or
(2) of the voluntary or involuntary dissolution, liquidation
or winding up of the Company; or
(3) of any action triggering an adjustment of the Conversion
Price pursuant to this Article XII;
then, in each case, the Company shall cause to be filed with the Trustee and the
Agent for the applicable Securities, and shall cause to be mailed, first class
postage prepaid, to the Holders of record of applicable Securities, at least
fifteen (15) days prior to the applicable date hereinafter specified, a notice
stating (x) the date on which a record is to be taken for the purpose of any
distribution or grant of rights or warrants triggering an adjustment to the
Conversion Price pursuant to this Article XII, or, if a record is not to be
taken, the date as of which the holders of record of Common Stock or other
Marketable Securities entitled to such distribution, rights or warrants are to
be determined, or (y) the date on which any reclassification, consolidation,
merger, sale, conveyance, dissolution, liquidation or winding up triggering an
adjustment to the Conversion Price pursuant to this Article XII is expected to
become effective, and the date as of which it is expected that holders of Common
Stock or other Marketable Securities of record shall be entitled to exchange
their Common Stock or other Marketable Securities for securities or other
property deliverable upon such reclassification, consolidation, merger, sale,
conveyance, dissolution, liquidation or winding up.
Failure to give such notice or any defect therein shall not
affect the legality or validity of the proceedings described in clause (1), (2)
or (3) of this Section.
SECTION 12.07. Company To Reserve Stock or other Marketable
Securities; Registration; Listing. (a) The Company shall at all times reserve
and keep available, free from preemptive rights, out of its authorized but
unissued shares of Common Stock or other Marketable Securities, for the purpose
of effecting the conversion of the Securities, such number of its duly
authorized shares of Common Stock or number or principal amount of other
Marketable Securities as shall from time to time be sufficient to effect the
conversion of all applicable outstanding Securities into such Common Stock or
other Marketable Securities at any time (assuming that, at the time of the
computation of such number of shares or securities, all such Securities would be
held by a single Holder); provided, however, that nothing
96
contained herein shall preclude the Company from satisfying its obligations in
respect of the conversion of the Securities by delivery of purchased shares of
Common Stock or other Marketable Securities which are held in the treasury of
the Company. The Company shall from time to time, in accordance with the laws of
the State of Delaware, use its best efforts to cause the authorized amount of
the Common Stock or other Marketable Securities to be increased if the aggregate
of the authorized amount of the Common Stock or other Marketable Securities
remaining unissued and the issued shares of such Common Stock or other
Marketable Securities in its treasury (other than any such shares reserved for
issuance in any other connection) shall not be sufficient to permit the
conversion of all Securities.
(b) If any shares of Common Stock or other Marketable
Securities which would be issuable upon conversion of Securities hereunder
require registration with or approval of any governmental authority before such
shares or securities may be issued upon such conversion, the Company will in
good faith and as expeditiously as possible endeavor to cause such shares or
securities to be duly registered or approved, as the case may be. The Company
will endeavor to list the shares of Common Stock or other Marketable Securities
required to be delivered upon conversion of the Securities prior to such
delivery upon the principal national securities exchange upon which the
outstanding Common Stock or other Marketable Securities is listed at the time of
such delivery.
SECTION 12.08. Taxes on Conversion. The Company shall pay any
and all documentary, stamp or similar issue or transfer taxes that may be
payable in respect of the issue or delivery of shares of Common Stock or other
Marketable Securities on conversion of Securities pursuant hereto. The Company
shall not, however, be required to pay any such tax which may be payable in
respect of any transfer involved in the issue or delivery of shares of Common
Stock or other Marketable Securities or the portion, if any, of the Securities
which are not so converted in a name other than that in which the Securities so
converted were registered, and no such issue or delivery shall be made unless
and until the person requesting such issue has paid to the Company the amount of
such tax or has established to the satisfaction of the Company that such tax has
been paid.
SECTION 12.09. Conversion After Record Date. If any Securities
are surrendered for conversion subsequent to the record date preceding an
Interest Payment Date but on or prior to such Interest Payment Date (except
Securities called for redemption on a Redemption Date between such
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record date and Interest Payment Date), the Holder of such Securities at the
close of business on such record date shall be entitled to receive the interest
payable on such securities on such Interest Payment Date notwithstanding the
conversion thereof. Securities surrendered for conversion during the period from
the close of business on any record date next preceding any Interest Payment
Date to the opening of business on such Interest Payment Date shall (except in
the case of Securities which have been called for redemption on a Redemption
Date within such period) be accompanied by payment in New York Clearing House
funds or other funds acceptable to the Company of an amount equal to the
interest payable on such Interest Payment Date on the Securities being
surrendered for conversion. Except as provided in this Section 12.09, no
adjustments in respect of payments of interest on Securities surrendered for
conversion or any dividends or distributions or interest on the Common Stock or
other Marketable Securities issued upon conversion shall be made upon the
conversion of any Securities.
SECTION 12.10. Corporate Action Regarding Par Value of Common
Stock. Before taking any action which would cause an adjustment reducing the
applicable Conversion Price below the then par value (if any) of the shares of
Common Stock or other Marketable Securities deliverable upon conversion of the
Securities, the Company will take any corporate action which may, in the opinion
of its counsel, be necessary in order that the Company may validly and legally
issue fully paid and nonassessable shares of Common Stock or other Marketable
Securities at such adjusted Conversion Price.
SECTION 12.11. Company Determination Final. Any determination
that the Company or the Board of Directors must make pursuant to this Article is
conclusive.
SECTION 12.12. Trustee's Disclaimer. The Trustee has no duty
to determine when an adjustment under this Article should be made, how it should
be made or what it should be. The Trustee makes no representation as to the
validity or value of any securities or assets issued upon conversion of
Securities. The Trustee shall not be responsible for the Company's failure to
comply with this Article. Each Conversion Agent other than the Company shall
have the same protection under this Section as the Trustee.
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ARTICLE XIII
Guarantees
SECTION 13.01. Guarantees. (a) Each of America Online and Time
Warner, as primary obligor and not merely as surety, will fully, irrevocably and
unconditionally guarantee (each, a "Guarantee"), to each Holder of Securities
(including each Holder of Securities issued under the Indenture after the date
of this Indenture) and to the Trustee and its successors and assigns (i) the
full and punctual payment of principal of and interest on the Securities when
due, whether at maturity, by acceleration, by redemption or otherwise, and all
other monetary obligations of the Company under this Indenture (including
obligations to the Trustee) and the Securities and (ii) the full and punctual
performance within applicable grace periods of all other obligations of the
Company under this Indenture and the Securities.
(b) Each of TBS and TWC, as primary obligor and not merely as
surety, will fully, irrevocably and unconditionally Guarantee, to each Holder of
Securities (including each Holder of Securities issued under the Indenture after
the date of this Indenture) and to the Trustee and its successors and assigns
(i) the full and punctual payment of all monies due under the Guarantee of Time
Warner, and all other monetary obligations of Time Warner under this Indenture
(including obligations to the Trustee) and (ii) the full and punctual
performance within applicable grace periods of all other obligations of Time
Warner under this Indenture and its Guarantee.
(c) Each of the Guarantors further agrees that its obligations
hereunder shall be unconditional irrespective of the absence or existence of any
action to enforce the same, the recovery of any judgment against the Company or
any other Guarantor (except to the extent such judgment is paid) or any waiver
or amendment of the provisions of this Indenture or the Securities to the extent
that any such action or any similar action would otherwise constitute a legal or
equitable discharge or defense of a guarantor (except that each such waiver or
amendment shall be effective in accordance with its terms).
(d) Each of the Guarantors further agrees that each Guarantee
constitutes a guarantee of payment, performance and compliance and not merely of
collection.
(e) Each of the Guarantors further agrees to waive presentment
to, demand of payment from and protest to
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the Company or any other Person, and also waives diligence, notice of acceptance
of its Guarantee, presentment, demand for payment, notice of protest for
nonpayment, the filing of claims with a court in the event of merger or
bankruptcy of the Company or any other Person and any right to require a
proceeding first against the Company or any other Person. The obligations of the
Guarantors shall not be affected by any failure or policy on the part of the
Trustee to exercise any right or remedy under this Indenture or the Securities
of any series.
(f) The obligation of each Guarantor to make any payment
hereunder may be satisfied by causing the Company or any other Person to make
such payment. If any Holder of any Security or the Trustee is required by any
court or otherwise to return to the Company or any Guarantor, or any custodian,
trustee, liquidator or other similar official acting in relation to any of the
Company or any Guarantor, any amount paid by any of them to the Trustee or such
Holder, the Guarantee of such Guarantor, to the extent theretofore discharged,
shall be reinstated in full force and effect.
(g) Each Guarantor also agrees to pay any and all reasonable
costs and expenses (including reasonable attorneys' fees) incurred by the
Trustee or any Holder of Securities in enforcing any of their respective rights
under its Guarantees.
(h) Any term or provision of this Indenture to the contrary
notwithstanding, the maximum aggregate amount of each of the Guarantees shall
not exceed the maximum amount that can be guaranteed by the relevant Guarantor
without rendering the relevant Guarantee under this Indenture voidable under
applicable law relating to fraudulent conveyance or fraudulent transfer or
similar laws affecting the rights of creditors generally.
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IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed as of the day and year first above written.
AOL TIME WARNER INC.,
by
---------------------------------
Name:
Title:
Attest:
---------------------------
Name:
Title:
AMERICA ONLINE, INC.,
by
-----------------------------------
Name:
Title:
Attest:
-----------------------------
Name:
Title:
TIME WARNER INC.,
by
-----------------------------------
Name:
Title:
Attest:
-----------------------------
Name:
Title:
101
TIME WARNER COMPANIES, INC.,
by
-----------------------------------
Name:
Title:
Attest:
-------------------------------
Name:
Title:
▇▇▇▇▇▇ BROADCASTING SYSTEM, INC.,
by
-----------------------------------
Name:
Title:
Attest:
----------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK, as
Trustee
by
-----------------------------------
Name:
Title:
Attest:
----------------------------------
Name:
Title: