(CONFORMED)
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CALFED INC.
TO
MANUFACTURERS HANOVER TRUST COMPANY
TRUSTEE
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INDENTURE
DATED AS OF FEBRUARY 15, 1986
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U.S. $125,000,000
6 1/2% Convertible Subordinated Debentures
Due 2001
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TABLE OF CONTENTS
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Parties......................................................................1
Recitals of the Company......................................................1
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 101. Definitions:
Act.............................................................1
Affiliate; control..............................................1
Authorized Newspaper............................................2
Bearer Security.................................................2
Board of Directors..............................................2
Board Resolution................................................2
Business Day....................................................2
California Federal..............................................2
Closing Market Price Per Share..................................2
Common Stock....................................................2
Company.........................................................3
Company Request; Company Order..................................3
Conversion Agent................................................3
Conversion Price................................................3
Converted Securities............................................3
Corporate Trust Office..........................................3
corporation.....................................................3
coupon..........................................................3
Defaulted Interest..............................................3
Dollar, U.S.$...................................................3
Event of Default................................................3
Exchange Date...................................................3
Global Security.................................................3
Holder..........................................................3
Indenture.......................................................3
Interest Payment Date...........................................3
Maturity........................................................3
Officers' Certificate...........................................4
Opinion of Counsel..............................................4
Outstanding.....................................................4
Paying Agent....................................................4
Person..........................................................4
Place of Conversion.............................................4
Place of Payment................................................4
Predecessor Security............................................4
Principal Subsidiary............................................5
Redemption Date.................................................5
Redemption Price................................................5
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Note: This table of contents shall not, for any purpose, be deemed part of the
Indenture.
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Registered Security.............................................5
Regular Record Date.............................................5
Responsible Officer.............................................5
Security Register; Security Registrar...........................5
Senior Indebtedness.............................................5
Special Record Date.............................................5
Stated Maturity.................................................5
Subsidiary......................................................6
Transfer Agent..................................................6
Trustee.........................................................6
United States...................................................6
United States Alien.............................................6
Vice President..................................................6
Section 102. Form of Documents Delivered to Trustee..........................6
Section 103. Acts of Holders of Securities...................................6
Section 104. Notices, Etc., to Trustee and Company...........................8
Section 105. Notice to Holders of Securities; Waiver.........................8
Section 106. Effect of Headings and Table of Contents........................9
Section 107. Successors and Assigns..........................................9
Section 108. Separability Clause.............................................9
Section 109. Benefits of Indenture...........................................9
Section 110. Governing Law...................................................9
Section 111. Legal Holidays..................................................9
Section 112. Appointment of Agent for Service...............................10
ARTICLE TWO
SECURITY FORMS
Section 201. Forms Generally................................................10
Section 202. Forms of Definitive Securities.................................11
Section 203. Form of Temporary Global Security..............................21
Section 204. Form of Coupon.................................................23
Section 205. Form of Trustee's Certificate of Authentication................24
Section 206. Forms of Conversion Notice.....................................25
ARTICLE THREE
THE SECURITIES
Section 301. Title and Terms................................................26
Section 302. Denominations..................................................26
Section 303. Execution, Authentication, Delivery and Dating.................27
Section 304. Temporary Global Security; Exchange of Temporary
Global Security for Definitive Securities.............27
Section 305. Registration, Registration of Transfer and
Exchange..............................................29
Section 306. Mutilated, Destroyed, Lost or Stolen Securities
and Coupons...........................................31
Section 307. Payment of Interest; Interest Rights Preserved.................32
Section 308. Persons Deemed Owners..........................................33
Section 309. Cancellation...................................................34
Section 310. Computation of Interest........................................34
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ARTICLE FOUR
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SATISFACTION AND DISCHARGE
Section 401. Satisfaction and Discharge of Indenture........................34
Section 402. Application of Trust Money.....................................35
ARTICLE FIVE
REMEDIES
Section 501. Events of Default..............................................35
Section 502. Acceleration of Maturity; Rescission and Assignment............37
Section 503. Collection of Indebtedness and Suits for
Enforcement by Trustee................................38
Section 504. Trustee May File Proofs of Claim...............................38
Section 505. Trustee May Enforce Claims Without Possession
of Securities or Coupons..............................39
Section 506. Application of Money Collected.................................39
Section 507. Limitation on Suits............................................39
Section 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest and to Convert...................40
Section 509. Restoration of Rights and Remedies.............................40
Section 510. Rights and Remedies Cumulative.................................40
Section 511. Delay or Omission Not Waiver...................................41
Section 512. Control by Holders of Securities...............................41
Section 513. Waiver of Past Defaults........................................41
Section 514. Undertaking for Costs..........................................41
Section 515. Waiver of Stay or Extension Laws...............................42
ARTICLE SIX
THE TRUSTEE
Section 601. Certain Duties and Responsibilities............................42
Section 602. Certain Rights of Trustee......................................43
Section 603. Not Responsible for Recitals or Issuance
of Securities.........................................44
Section 604. May Hold Securities, Act as Trustee Under
Other Indentures......................................44
Section 605. Money Held in Trust............................................44
Section 606. Compensation and Reimbursement.................................44
Section 607. Corporate Trustee Required; Eligibility........................45
Section 608. Resignation and Removal; Appointment of Successor..............45
Section 609. Acceptance of Appointment by Successor.........................45
Section 610. Merger, Conversion, Consolidation or Succession
to Business...........................................46
ARTICLE SEVEN
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
Section 701. Company May Consolidate, Etc., Only
on Certain Terms......................................47
Section 702. Successor Substituted..........................................47
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ARTICLE EIGHT
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SUPPLEMENTAL INDENTURES
Section 801. Supplemental Indentures Without Consent
of Holders............................................47
Section 802. Supplemental Indentures With Consent of Holders
of Securities.........................................48
Section 803. Execution of Supplemental Indentures...........................49
Section 804. Effect of Supplemental Indentures..............................49
Section 805. Reference in Securities to Supplemental
Indentures............................................49
Section 806. Notice of Supplemental Indentures..............................49
ARTICLE NINE
MEETINGS OF HOLDERS OF SECURITIES
Section 901. Purposes for Which Meetings May Be Called......................50
Section 902. Call, Notice and Place of Meetings.............................50
Section 903. Persons Entitled to Vote at Meetings...........................50
Section 904. Quorum; Action.................................................50
Section 905. Determination of Voting Rights; Conduct and
Adjournment of Meetings...............................51
Section 906. Counting Votes and Recording Action of Meetings................52
ARTICLE TEN
COVENANTS
Section 1001. Payment of Principal, Premium and Interest....................52
Section 1002. Maintenance of Offices or Agencies............................52
Section 1003. Money for Security Payments to Be Held in Trust...............54
Section 1004. Additional Amounts............................................55
Section 1005. Corporate Existence...........................................55
Section 1006. Maintenance of Properties.....................................55
Section 1007. Payment of Taxes and Other Claims.............................56
Section 1008. Limitation on Debt Secured by Stock of
California Federal...................................56
Section 1009. Limitation on Disposition of Stock of
California Federal...................................56
Section 1010. Statement by Officers as to Default...........................56
Section 1011. Waiver of Certain Covenants...................................56
ARTICLE ELEVEN
REDEMPTION OF SECURITIES AT OPTION OF COMPANY
Section 1101. Right of Redemption...........................................57
Section 1102. Applicability of Article......................................57
Section 1103. Election to Redeem; Notice to Trustee.........................57
Section 1104. Selection by Trustee of Securities to Be
Redeemed.............................................57
Section 1105. Notice of Redemption..........................................58
Section 1106. Deposit of Redemption Price...................................58
Section 1107. Securities Payable on Redemption Date.........................59
Section 1108. Securities Redeemed in Part...................................59
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ARTICLE TWELVE
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REDEMPTION OF SECURITIES AT OPTION OF HOLDERS
Section 1201. Redemption at Option of Holders...............................60
Section 1202. Applicability of Article......................................60
Section 1203. Notice of Redemption Date.....................................60
Section 1204. Deposit of Redemption Price...................................61
Section 1205. Securities Payable on Redemption Date.........................61
Section 1206. Securities Redeemed in Part...................................62
ARTICLE THIRTEEN
CONVERSION OF SECURITIES
Section 1301. Conversion Privilege and Conversion Price.....................62
Section 1302. Exercise of Conversion Privilege..............................62
Section 1303. Fractions of Shares...........................................63
Section 1304. Adjustment of Conversion Price................................63
Section 1305. Notice of Adjustments of Conversion Price.....................65
Section 1306. Notice of Certain Corporate Action............................66
Section 1307. Company to Reserve Common Stock...............................66
Section 1308. Taxes on Conversions..........................................67
Section 1309. Covenant as to Common Stock...................................67
Section 1310. Cancellation of Converted Securities..........................67
Section 1311. Provisions in Case of Consolidation, Merger
or Sale of Assets....................................67
Section 1312. Responsibility of Trustee for
Conversion Provisions................................68
ARTICLE FOURTEEN
SUBORDINATION OF SECURITIES
Section 1401. Securities Subordinate to Senior Indebtedness.................68
Section 1402. Payment Over of Proceeds Upon Dissolution, Etc................68
Section 1403. Prior Payment to Senior Indebtedness
Upon Acceleration of Securities......................69
Section 1404. No Payment When Senior Indebtedness in Default................69
Section 1405. Payment Permitted If No Default...............................70
Section 1406. Subrogation to Rights of Holders of
Senior Indebtedness..................................70
Section 1407. Provisions Solely to Define Relative Rights...................70
Section 1408. Trustee to Effectuate Subordination...........................71
Section 1409. No Waiver of Subordination Provisions.........................71
Section 1410. Notice to Trustee.............................................71
Section 1411. Reliance on Judicial Order or Certificate
of Liquidating Agent.................................72
Section 1412. Trustee Not Fiduciary for Holders of Senior
Indebtedness.........................................72
Section 1413. Rights of Trustee as Holder of Senior Indebtedness;
Preservation of Trustee's Rights.....................72
Section 1414. Article Applicable to Paying Agents...........................73
Section 1415. Certain Conversions Deemed Payment............................73
TESTIMONIUM.................................................................74
SIGNATURES AND SEALS........................................................74
ACKNOWLEDGEMENTS............................................................75
v
INDENTURE, dated as of February 15, 1986, between CALFED INC., a
corporation duly organized and existing under the laws of the State of
Delaware (herein called the "Company"), having its principal office at ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and MANUFACTURERS HANOVER
TRUST COMPANY, a corporation duly organized and existing under the laws of the
State of New York, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an issue of its 6
1/2% Convertible Subordinated Debentures Due 2001 (herein called the
"Securities") and the coupons, if any, thereto appertaining, of substantially
the tenor and amount hereinafter set forth, and to provide therefor the
Company has duly authorized the execution and delivery of this Indenture.
All things necessary to make the Securities and the coupons, if any,
thereto appertaining, when the Securities are executed by the Company and
authenticated and delivered hereunder and duly issued by the Company, the
valid obligations of the Company, and to make this Indenture a valid agreement
of the Company, in accordance with their and its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually covenanted and agreed, for
the equal and proportionate benefit of all Holders of the Securities and the
coupons, if any, thereto appertaining, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 101. Definitions.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as
the singular;
(2) all accounting terms not otherwise defined herein have
the meanings assigned to them in accordance with generally accepted
accounting principles in the United States of America, and, except as
otherwise herein expressly provided, the term "generally accepted
accounting principles" with respect to any computation required or
permitted hereunder shall mean such accounting principles as are
generally accepted in the United States of America at the date of
such computation; and
(3) 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.
"Act", when used with respect to any Holder of a Security, has the
meaning specified in Section 103.
"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.
"Authorized Newspaper" means a newspaper, in an official language of
the country of publication or in the English language, customarily published
on each Business Day, whether or not published on Saturdays, Sundays or
holidays, and of general circulation in the place in connection with which the
term is used or in the financial community of such place. Where successive
publications are required to be made in Authorized Newspapers, the successive
publications may be made in the same or in different newspapers in the same
city meeting the foregoing requirements and in each case on any Business Day.
"Bearer Security" means any Security in the form for Bearer
Securities set forth in Section 202 payable to bearer.
"Board of Directors" means either the board of directors of the
Company or any duly authorized committee of that board.
"Board Resolution" means a resolution duly adopted by the Board of
Directors, a copy of which, certified by the Secretary or an Assistant
Secretary of the Company to be in full force and effect on the date of such
certification, shall have been delivered to the Trustee.
"Business Day", when used with respect to any Place of Payment or
Place of Conversion, means each Monday, Tuesday, Wednesday, Thursday and
Friday which is not a day on which banking institutions in that Place of
Payment or Place of Conversion, as the case may be, are authorized or
obligated by law to close.
"California Federal" means California Federal Savings and Loan
Association or any successor corporation by merger, conversion, consolidation
or other combination or any transferee of all or substantially all the assets
of California Federal as an entirety.
"Closing Market Price Per Share" means, for any day, the last
reported sales price regular way of the Common Stock or, in case no such
reported sale takes place on such day, the average of the reported closing bid
and asked prices regular way of the Common Stock, in either case on the New
York Stock Exchange or, if the Common Stock is not listed or admitted to
trading on such Exchange, on the principal national securities exchange within
the United States on which the Common Stock is listed or admitted to trading
or, if not listed or admitted to trading on any national securities exchange
within the United States, the average of the closing bid and asked prices of
the Common Stock in the over-the-counter market as reported by National
Association of Securities Dealers' Automated Quotation System ("NASDAQ") or,
if not so reported by NASDAQ, the average of the closing bid and asked prices
of the Common Stock as furnished by any leading New York Stock Exchange member
firm selected from time to time by the Company for that purpose.
"Common Stock" includes any stock of any class of the Company which
has no preference in respect of dividends or of amounts payable in the event
of any voluntary or involuntary liquidation, dissolution or winding up of the
Company and which is not subject to redemption by the Company. However,
subject to the provisions of Section 1811, shares issuable on conversion of
Securities shall include only shares of the class designated as Common Stock
of the Company at the date of this instrument or shares of any class or
classes resulting from any reclassification or reclassifications thereof and
which have no preference in respect of dividends or of amounts payable in the
event of any voluntary or involuntary liquidation, dissolution or winding
2
up of the Company and which are not subject to redemption by the Company;
provided that if at any time there shall be more than one such resulting
class, the shares of each such class then so issuable shall be substantially
in the proportion which the total number of shares of such class resulting
from all such reclassifications bears to the total number of shares of all
such classes resulting from all such reclassifications.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by the Chairman of the Board, the President
or a Vice President, and by the Treasurer, an Assistant Treasurer, the
Secretary or an Assistant Secretary, of the Company, and delivered to the
Trustee.
"Conversion Agent" means any Person authorized by the Company to
convert Securities in accordance with Article Thirteen.
"Conversion Price" has the meaning specified in Section 1301.
"Converted Securities" means all Securities which have been converted
pursuant to Article Thirteen.
"Corporate Trust Office" means the principal office of the Trustee in
the Borough of Manhattan, The City of New York, at which at any particular
time its corporate trust business shall be administered.
"corporation" includes corporations, associations, companies and
business trusts.
"coupon" means any interest coupon appertaining to a Bearer Security.
"Defaulted Interest" has the meaning specified in Section 307.
"Dollar" or "U.S.$" means a dollar or other equivalent unit in such
coin or currency of the United States of America as at the time shall be legal
tender for the payment of public and private debts.
"Event of Default" has the meaning specified in Section 501.
"Exchange Date" means the date 90 days after the completion of the
distribution of the Securities established as contemplated by Section 304.
"Global Security" means a temporary security in the form set forth in
Section 203.
"Holder", when used with respect to any Security, means in the case
of a Registered Security the Person in whose name the Security is registered
in the Security Register and in the case of a Bearer Security or the Global
Security the bearer thereof and, when used with respect to any coupon, means
the bearer thereof.
"Indenture" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof.
"Interest Payment Date" means the Stated Maturity of an instalment of
interest on the Securities.
"Maturity", when used with respect to any Security, means the date on
which the principal of such Security becomes due and payable as therein or
herein provided, whether at the Stated
3
Maturity or by declaration of acceleration, call for redemption, redemption at
the option of the Holder thereof or otherwise.
"Officers' Certificate" means a certificate signed by the Chairman of
the Board, the President or a Vice President, and by the Treasurer, an
Assistant Treasurer, the Secretary or an Assistant Secretary, of the Company,
and delivered to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company, and who shall be acceptable to the Trustee.
"Outstanding", when used with respect to Securities, means, as of the
date of determination, all Securities theretofore authenticated and delivered
under this Indenture, except:
(i) Securities theretofore cancelled by the Trustee or
delivered to the Trustee for cancellation;
(ii) Securities for whose payment or redemption money in the
necessary amount has been theretofore deposited with the Trustee or
any Paying Agent (other than the Company) in trust or set aside and
segregated in trust by the Company (if the Company shall act as its
own Paying Agent) for the Holders of such Securities and any coupons
thereto appertaining; 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) Securities which have been paid pursuant to Section
306 or in exchange for or in lieu of which other Securities have been
authenticated and delivered pursuant to this Indenture, other than
any such Securities in respect of which there shall have been
presented to the Trustee proof satisfactory to it that such
Securities are held by a bona fide purchaser in whose hands such
Securities are valid obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities are present at a meeting of
Holders of Securities for quorum purposes or have given any request, demand,
authorization, direction, notice, consent or waiver hereunder. Securities
owned by the Company or any other obligor upon the Securities or any Affiliate
of the Company or such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be
protected in relying upon any such determination as to the presence of a
quorum or upon any such request, demand, authorization, direction, notice,
consent or waiver, only Securities which the Trustee knows to be so owned
shall be so disregarded. Securities so owned which have been pledged in good
faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right so to act with respect to such
Securities and that the pledgee is not the Company or any other obligor upon
the Securities or any Affiliate of the Company or of 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.
"Person" means any individual, corporation, partnership, joint
venture, trust, unincorporated organization or government or any agency or
political subdivision thereof.
"Place of Conversion" has the meaning specified in Section 301.
"Place of Payment" has the meaning specified in Section 301.
"Predecessor Security" 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
4
purposes of this definition, any Security authenticated and delivered under
Section 306 in exchange for or in lieu of a mutilated, destroyed, lost or
stolen Security shall be deemed to evidence the same debt as the mutilated,
destroyed, lost or stolen Security.
"Principal Subsidiary" means any present or future consolidated
Subsidiary of the Company whose consolidated assets constitute 10% or more of
the consolidated assets of the Company.
"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 at which it is to be redeemed pursuant to this
Indenture.
"Registered Security" means any Security in the form for Registered
Securities set forth in Section 202 registered in the Security Register.
"Regular Record Date" for the interest payable on any Interest
Payment Date means the February 5 (whether or not a Business Day) next
preceding such Interest Payment Date.
"Responsible Officer", when used with respect to the Trustee, means
the chairman or any vice-chairman of the board of directors, the chairman or
any vice-chairman of the executive committee of the board of directors, the
chairman of the trust committee, the president, any vice president, the
secretary, any assistant secretary, the treasurer, any assistant treasurer,
the cashier, any assistant cashier, any trust officer or assistant trust
officer, the controller or any assistant controller, or any other employee of
the Trustee customarily performing functions similar to those performed by any
of the above designated officers and also means, with respect to a particular
corporate trust matter, any other employee to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 305.
"Senior Indebtedness" means the principal of (and premium, if any)
and interest on (a) all indebtedness of the Company (including indebtedness of
others guaranteed by the Company) other than the Securities, whether
outstanding on the date of this Indenture or thereafter created, incurred or
assumed, which is (i) for money borrowed or (ii) evidenced by a note or
similar instrument given in connection with the acquisition of any businesses,
properties or assets of any kind, except in the ordinary course of business,
(b) obligations of the Company as lessee under leases required to be
capitalized on the balance sheet of the lessee under generally accepted
accounting principles and leases of property or assets made as part of any
sale and lease-back transaction to which the Company is a party and (c)
amendments, renewals, extensions, modifications or refundings of any such
indebtedness or obligation, unless in any case in the instrument creating or
evidencing any such indebtedness or obligation or pursuant to which the same
is outstanding it is provided that such indebtedness or obligation is not
superior in right of payment to the Securities.
"Special Record Date" for the payment of any Defaulted Interest means
a date fixed by the Trustee pursuant to Section 307.
"Stated Maturity", when used with respect to any Security or any
instalment of interest thereon, means the date specified in such Security or a
coupon representing such instalment of interest at the fixed date on which the
principal of such Security or such instalment of interest is due and payable.
5
"Subsidiary" means a corporation more than 50% of the outstanding
voting stock of which is owned, directly or indirectly, by the Company or by
one or more other Subsidiaries, or by the Company and one or more other
Subsidiaries. For the purposes of this definition, "voting stock" means stock
which ordinarily has voting power for the election of directors, whether at
all times or only so long as no senior class of stock has such voting power by
reason of any contingency.
"Transfer Agent" means any Person, which may be the Company,
authorized by the Company to exchange or register the transfer of Securities.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.
"United States" has the meaning set forth in the forms of Definitive
Securities contained in Section 202.
"United States Alien" has the meaning set forth in the forms of
Definitive Securities contained in Section 202.
"Vice President", when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president".
SECTION 102. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and
one or more other such Persons as to other matters, and any such Person may
certify or give an opinion as to such matters 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 such 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 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 103. Acts of Holders of Securities.
(a) Any request, demand, authorization, direction, notice, consent,
election, waiver or other action provided by this Indenture to be given or
taken by Holders of Securities may be embodied in and evidenced by (1) one or
more instruments of substantially similar tenor signed by such Holders in
person or by agent or proxy duly appointed in writing, (2) the record of
Holders of Securities voting in favor thereof, either in person or by proxies
duly appointed in
6
writing, at any meeting of Holders of Securities duly called and held in
accordance with the provisions of Article Nine, or (3) a combination of such
instruments and any such record. Except as herein otherwise expressly
provided, such action shall become effective when such instrument or
instruments or record or both are delivered to the Trustee and, where it is
hereby expressly required, to the Company. Such instrument or instruments and
record (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Holders of Securities signing such
instrument or instruments and so voting at such meeting. Proof of execution of
any such instrument or of a writing appointing any such agent or proxy, or of
the holding by any Person of a Security, shall be sufficient for any purpose
of this Indenture and (subject to Section 601) conclusive in favor of the
Trustee and the Company if made in the manner provided in this Section. The
record of any meeting of Holders of Securities shall be proved in the manner
provided in Section 906.
(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 of such
execution or by a certificate of a 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 a signer acting in a capacity other than his
individual capacity, 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 principal amount and serial numbers of Bearer Securities held
by any Person, and the date of his holding the same, may be proved by the
production of such Bearer Securities or by a certificate executed, as
depositary, by any trust company, bank, banker or other depositary, wherever
situated, if such certificate shall be deemed by the Trustee to be
satisfactory, showing that at the date therein mentioned such Person had on
deposit with such depositary, or exhibited to it, the Bearer Securities
therein described; or such facts may be proved by the certificate or affidavit
of the Person holding such Bearer Securities, if such certificate or affidavit
is deemed by the Trustee to be satisfactory. The Trustee and the Company may
assume that such ownership of any Bearer Security continues until (1) another
certificate or affidavit bearing a later date issued in respect of the same
Bearer Security is produced, or (2) such Bearer Security is produced to the
Trustee by some other Person, or (3) such Bearer Security is surrendered in
exchange for a Registered Security; or (4) such Bearer Security is no longer
Outstanding.
(d) The fact and date of execution of any such instrument or writing,
the authority of the Person executing the same and the principal amount and
serial numbers of Bearer Securities held by the Person so executing such
instrument or writing and the date of holding the same may also be proved in
any other manner which the Trustee deems sufficient; and the Trustee may in
any instance require further proof with respect to any of the matters referred
to in this Section.
(e) The principal amount and serial numbers of Registered Securities
held by any Person, and the date of his holding the same, shall be proved by
the Security Register.
(f) Any request, demand, authorization, direction, notice, consent,
election, waiver or other Act of the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Security issued
upon the registration or transfer thereof or in exchange therefor or in lieu
thereof in respect of anything done, omitted 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.
7
SECTION 104. Notices, Etc. to Trustee and Company
Any request, demand, authorization, direction, notice, consent,
election, waiver or Act of Holders of Securities or other document provided or
permitted by this Indenture to be made upon, given or furnished to, or filed
with,
(1) the Trustee by any Holder of Securities 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 (which at the date hereof is located at ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ 10020), Attention: Corporate Trust
Department, or
(2) the Company by the Trustee or by any Holder of
Securities shall be sufficient for every purpose hereunder (unless
otherwise herein expressly provided) if in writing, mailed,
first-class postage prepaid, or telexed or telecopied and confirmed
by mail, first-class postage prepaid, addressed to it at the address
of its principal office specified in the first paragraph of this
instrument to the attention of its Secretary, or at any other address
previously furnished in writing to the Trustee by the Company.
Any request, demand, authorization, direction, notice, consent, election or
waiver required or permitted under this Indenture shall be in the English
language, except that any published notice (other than a notice published in
Luxembourg) may be in an official language of the country of publication.
SECTION 105. Notice to Holders of Securities; Waiver.
Except as otherwise expressly provided herein, where this Indenture
provides for notice to Holders of Securities of any event (the expense for
which shall be borne by the Company),
(1) such notice shall be sufficiently given to Holders of
Bearer Securities if published in an Authorized Newspaper in London
and, so long as the Securities are listed on the Luxembourg Stock
Exchange and such stock exchange shall so require, in Luxembourg or,
if not practicable, in Europe, on a Business Day at least twice, the
first such publication to be not earlier than the earliest date and
not later than the latest date prescribed for the giving of such
notice; and
(2) such notice shall be sufficiently given to Holders of
Registered Securities if in writing and mailed, first-class postage
prepaid, to each Holder of a Registered Security affected by such
event, at the address of such Holder as it appears in the Security
Register, not earlier than the earliest date, and not later than the
latest date, prescribed for the giving of such notice.
Neither failure to give notice by publication to Holders of Bearer
Securities as provided above, nor any defect in any notice so published, shall
affect the sufficiency of any notice mailed to Holders of Registered
Securities as provided above. In case by reason of the suspension of
publication of any Authorized Newspaper or Authorized Newspapers or by reason
of any other cause it shall be impracticable to publish any notice to Holders
of Bearer Securities as provided above, then such notification to Holders of
Bearer Securities as shall be given with the approval of the Trustee shall
constitute sufficient notice to such Holders for every purpose hereunder.
In any case where notice to Holders of Registered Securities is given
by mail, neither the failure to mail such notice, nor any defect in any notice
so mailed, to any particular Holder of a Registered Security shall affect the
sufficiency of such notice with respect to other Holders of Registered
Securities or the sufficiency of any notice by publication to Holders of
Bearer
8
Securities given as provided above. In case by reason of the suspension of
regular mail service or by reason of any other cause it shall be impracticable
to give such notice by mail, then such notification to Holders of Registered
Securities as shall be made with the approval of the Trustee shall constitute
a sufficient notification to such Holders for every purpose hereunder.
Where this Indenture provides for notice in any manner, such notice
may be waived in writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders shall be filed with the Trustee, but such
filing shall not be a condition precedent to the validity of any action taken
in reliance upon such waiver.
SECTION 106. 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 107. Successors and Assigns.
All covenants and agreements in this Indenture by the Company shall
bind its successors and assigns, whether so expressed or not.
SECTION 108. Separability Clause.
In case any provision in this Indenture or in the Securities or
coupons 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 109. Benefits of Indenture.
Nothing in this Indenture or in the Securities or coupons, express or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder, the holders of Senior Indebtedness and the Holders of
Securities and coupons, any benefit or any legal or equitable right, remedy or
claim under this Indenture.
SECTION 110. Governing Law.
This Indenture and each of the Securities and coupons shall be
governed by and construed in accordance with the laws of the State of New
York.
SECTION 111. Legal Holidays.
In any case where any Interest Payment Date, any Redemption Date or
the Stated Maturity of any Security or the last day on which a Holder of a
Security has the right to convert his Security shall not be a Business Day at
any Place of Payment or Place of Conversion, then (notwithstanding any other
provision of this Indenture or of the Securities or coupons) payment of
interest or principal (and premium, if any) or conversion of the Securities
need not be made at such Place of Payment or Place of Conversion on such day,
but may be made on the next succeeding Business Day at such Place of Payment
or Place of Conversion with the same force and effect as if made on the
Interest Payment Date or Redemption Date, or at the Stated Maturity or on such
last day for conversion, provided that, in the case of payment, no interest
shall accrue on the amount so payable for the period from and after such
Interest Payment Date, Redemption Date or Stated Maturity, as the case may be.
9
SECTION 112. Appointment of Agent for Service.
By the execution and delivery of this Indenture, the Company hereby
appoints the Trustee as its agent upon which process may be served in any
legal action or proceeding which may be instituted in any Federal or State
court in the Borough of Manhattan, The City of New York, arising out of or
relating to the Securities, the coupons or this Indenture. Service of process
upon such agent at the office of such agent at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trust Department (or such other address in
the Borough of Manhattan, The City of New York, as may be the Corporate Trust
Office of the Trustee), and written notice of said service to the Company by
the Person serving the same addressed as provided in Section 104, shall be
deemed in every respect effective service of process upon the Company in any
such legal action or proceeding, and the Company hereby submits to the
jurisdiction of any such court in which any such legal action or proceeding is
so instituted. Such appointment shall be irrevocable so long as the Holders of
Securities or coupons shall have any rights pursuant to the terms thereof or
of this Indenture until the appointment of a successor by the Company with the
consent of the Trustee and such successor's acceptance of such appointment.
The Company further agrees to take any and all action, including the execution
and filing of any and all such documents and instruments, as may be necessary
to continue such designation and appointment of such agent or successor.
By the execution and delivery of this Indenture, the Trustee hereby
agrees to act as such agent and undertakes promptly to notify the Company of
receipt by it of service of process in accordance with this Section.
ARTICLE TWO
SECURITY FORMS
SECTION 201. Forms Generally.
The Securities and the coupons shall be in substantially the forms
set forth in this Article, with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this
Indenture, and may have such letters, numbers or other marks of identification
and such legends or endorsements placed thereon as may be required to comply
with the rules of any securities exchange or as may, consistently herewith, be
determined by the officers executing such Securities and coupons, as evidenced
by their execution of the Securities.
The Trustee's certificates of authentication shall be in
substantially the form set forth in this Article.
Conversion notices shall be in substantially the form set forth in
this Article.
The definitive Securities and coupons 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 and coupons, as evidenced by their
execution of such Securities.
10
SECTION 202. Forms of Definitive Securities.
[Form of Face]
[If Bearer Security:
ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO
LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS, INCLUDING THE LIMITATIONS
PROVIDED IN SECTIONS 165(J) AND 1287(A) OF THE INTERNAL REVENUE CODE.
CALFED INC.
6 1/2% CONVERTIBLE SUBORDINATED DEBENTURE DUE 2001
No. B- U.S.$5,000
CALFED INC., a corporation duly organized and existing under the laws
of the State of Delaware (herein called the "Company", which term includes any
successor corporation under the Indenture referred to on the reverse hereof),
for value received, hereby promises to pay to bearer upon presentation and
surrender of this Security the principal sum of Five Thousand United States
Dollars on February 20, 2001 and to pay interest thereon, from the date
hereof, annually in arrears on February 20 in each year ("Interest Payment
Date"), commencing February 20, 1987, at the rate of 6 1/2% per annum, until
the principal hereof is paid or made available for payment. Such payments
(including premium, if any) shall be made, subject to any laws or regulations
applicable thereto and to the rights of the Company (limited as provided in
the Indenture) to terminate the appointment of any such Paying Agent, at the
main offices of Manufacturers Hanover Bank/Belgium S.A. in Brussels,
Manufacturers Hanover Bank Luxembourg S.A. in Luxembourg and Manufacturers
Hanover Trust Company in Frankfurt/Main, London and Zurich, or at such other
offices or agencies outside the United States (as defined below) as the
Company may designate and notify the Holder as provided on the reverse hereof,
by United States dollar check drawn on a bank in The City of New York, or by
transfer to a United States dollar account maintained by the payee with a bank
located in a European city. Interest on this Security due on or before
maturity (but not any additional amounts which may be payable as provided
below) shall be payable only upon presentation and surrender at such an office
or agency of the interest coupons hereto attached as they severally mature. No
payment of principal, premium or interest with respect to this Security shall
be made at the Corporate Trust Office of the Trustee under the Indenture or at
any other office or agency of the Company in the United States or by check
mailed to an address in the United States or by transfer to an account
maintained with a bank located in the United States. Notwithstanding the
foregoing, payment of principal of and premium, if any, and interest on this
Security and payment of any such additional amounts may be made at the Paying
Agent in the Borough of Manhattan, The City of New York if (but only if)
payment of the full amount of such principal, premium, interest or additional
amounts, as the case may be, at all offices outside the United States
maintained for the purpose by the Company in accordance with the Indenture is
illegal or effectively precluded by exchange controls or other similar
restrictions.]
11
[If Registered Security:
CALFED INC.
6 1/2% CONVERTIBLE SUBORDINATED DEBENTURE DUE 2001
No. R- U.S.$
CALFED, INC., a corporation duly organized and existing under the
laws of the State of Delaware (herein called the "Company", which term
includes any successor corporation under the Indenture referred to on the
reverse hereof), for value received, hereby promises to pay to ,
or registered assigns, the principal sum of Thousand United
States Dollars on February 20, 2001 and to pay interest thereon, from
February 20, 1986 or from the most recent Interest Payment Date to which
interest has been paid or duly provided for, annually in arrears on February 20
in each year ("Interest Payment Date"), commencing February 20, 1987, at the
rate of 6 1/2% per annum, until the principal hereof is paid or made available
for payment. The interest so payable, and punctually paid or duly provided for,
on any Interest Payment Date will, as provided in the Indenture, be paid to the
Person in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such
interest, which shall be the February 5 (whether or not a Business Day) next
preceding such Interest Payment Date. Except as otherwise provided in the
Indenture, any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Holder on such Regular Record Date and may
either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities not less than
10 days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities may be listed, and upon such notice as may be required
by such exchange, all as more fully provided in the Indenture. Payments of
principal of and premium, if any, on this Security shall be made at the option
of the Holder (a) at the Corporate Trust Office of the Trustee, or at such
other office or agency of the Company as may be designated by it for such
purpose in the Borough of Manhattan, The City of New York, in such coin or
currency of the United States of America as at the time of payment shall be
legal tender for the payment of public and private debts of (b) subject to any
laws or regulations applicable thereto and to the right of the Company (limited
as provided in the Indenture) to terminate the appointment of any such Paying
Agent, at the main offices of Manufacturers Hanover Bank/Belgium S.A. in
Brussels and Manufacturers Hanover Bank Luxembourg S.A. in Luxembourg or at
such other offices or agencies which are both Paying and Transfer Agents as
the Company may designate and notify the Holder as provided on the reverse
hereof, by United States dollar check drawn on, or by transfer to a United
States dollar account maintained by the payee with, a bank in The City of New
York. Payment of interest on this Security shall be made by United States
dollar check drawn on a bank in The City of New York and mailed to the address
of the Person entitled thereto as such address shall appear in the Security
Register, or upon application by the Holder hereof to the Security Registrar
not later than the Regular Record Date in the year the payment is to be
received, by transfer to a United States dollar account maintained by the
payee with a bank in The City of New York.]
The Company will pay to the holder of this Security [If Bearer
Security or of any coupon appertaining hereto] who is a United States Alien
(as defined below) such additional amounts as may be necessary in order that
every net payment of the principal of (and premium, if any)
12
and interest on this Security after deduction or withholding for or on account
of any present or future tax, assessment or other governmental charge imposed
upon or as a result of such payment by the United States [If Registered
Security -- (as defined below)] or any political subdivision or taxing
authority thereof or therein, will not be less than the amount provided for in
this Security [If Bearer Security - or in such coupon] to be then due and
payable; provided, however, that the foregoing obligation to pay additional
amounts will not apply to any one or more of the following:
(a) any tax, assessment or other governmental charge which
would not have been so imposed but for (i) the existence of any
present or former connection between such Holder (or between a
fiduciary, settlor, beneficiary or member of such Holder, if such
Holder is an estate, a trust or a partnership) and the Untied States,
including, without limitation, such Holder (or such fiduciary,
settlor, beneficiary or member) being or having been a citizen or
resident or treated as a resident thereof, or being or having been
engaged in trade or business or present therein, or having or having
had a permanent establishment therein, or (ii) such Holder's present
or former status as a personal holding company, a foreign personal
holding company, or a controlled foreign corporation for United
States tax purposes or a corporation which accumulates earnings to
avoid United States federal income tax;
(b) any tax, assessment or other governmental charge which
would not have been imposed but for the presentation by the Holder of
this Security [If Bearer Security -- or any coupon appertaining
hereto] for payment on a date more than 15 days after the date on
which such payment became due and payable or the date on which payment
thereof is duly provided for, whichever occurs later;
(c) any estate, inheritance, gift, sales, transfer,
personal property or any similar tax, assessment or governmental
charge;
(d) any tax, assessment or other governmental charge which
would not have been imposed but for the failure to comply with any
certification, identification or other reporting requirements
concerning the nationality, residence, identity or connection with
the United States of the Holder or beneficial owner of this Security
[If Bearer Security -- or any coupon appertaining hereto], if
compliance is required by statute or by regulation of the United
States Treasury Department as a precondition to exemption from such
tax, assessment or other governmental charge;
(e) any tax, assessment or other governmental charge which
is payable otherwise than by deduction or withholding from payments
of principal of (and premium, if any) or interest on this Security;
or
(f) any tax, assessment or other governmental charge imposed
on interest received by a person holding, actually or constructively,
10% or more of the total combined voting power of all classes of
stock of the Company entitled to vote;
nor will additional amounts be paid with respect to any payment of principal
of (and premium, if any) or interest on this Security to any United States
Alien who is a fiduciary or partnership or other than the sole beneficial
owner of any such payment to the extent that a beneficiary or settlor with
respect to such fiduciary, a member of such a partnership or the beneficial
owner would not have been entitled to the additional amounts had such
beneficiary, settlor, member or beneficial owner been the Holder of this
Security [If Bearer Security -- or any coupon appertaining hereto]. The term
"United States Alien" means any person who, for United States
13
federal income tax purposes, is a foreign corporation, a nonresident alien
individual, a nonresident alien fiduciary of a foreign estate or trust, or a
foreign partnership one or more of the members of which is, for United States
federal income tax purposes, a foreign corporation, a nonresident alien
individual or a nonresident alien fiduciary of a foreign estate or trust, and
the term "United States" means the United States of America, its territories
and possessions.
Notwithstanding the foregoing, if and so long as a certification,
identification or other information reporting requirement referred to in the
fourth paragraph on the reverse hereof would be fully satisfied by payment of
a backup withholding tax or similar charge, the Company may elect, by so
stating in the Determination Notice (as defined on the reverse hereof), to
have the provisions of this paragraph apply in lieu of the provisions of such
paragraph. In such event, the Company will pay as additional amounts such
amounts as may be necessary so that every net payment made following the
effective date of such requirements outside the United States by the Company
or any of its Paying Agents of principal (premium, if any) or interest due in
respect of any Bearer Security or any coupon appertaining thereto of which the
beneficial owner is a United States Alien (but without any requirement that
the nationality, residence or identity of such beneficial owner be disclosed
to the Company, any Paying Agent or any governmental authority), after
deduction or withholding for or on account of such backup withholding tax or
similar charge other than a backup withholding tax or similar charge which is
(i) the result of a certification, identification or information reporting
requirement described in the second parenthetical clause of such paragraph, or
(ii) imposed as a result of the fact that the Company or any of its Paying
Agents has actual knowledge that the beneficial owner of such Bearer Security
or coupon is within the category of persons described in clause (a) of the
preceding paragraph, or (iii) imposed as a result of presentation of such
Bearer Security or coupon for payment more than 15 days after the date on
which such payment becomes due and payable or on which payment thereof is duly
provided for, whichever occurs later, will not be less than the amount
provided for in such Bearer Security or coupon to be then due and payable.
Except as specifically provided herein and in the indenture, the
Company shall not be required to make any payment with respect to any tax,
assessment or other governmental charge imposed by any government or any
political subdivision or taxing authority thereof or therein.
Reference is hereby made to the further provisions of this Security
set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
[If Bearer Security:
Unless the certificate of authentication hereon has been executed by
the Trustee by the manual signature of one of its authorized officers, neither
this Security, nor any coupon appertaining hereto, shall be entitled to any
benefit under the Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this Security to be duly
executed under its corporate seal and coupons bearing the facsimile signature
of its Treasurer to be annexed hereto.
Dated as of February 20, 1986]
14
[If Registered Security:
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by the manual signature of one
of its authorized officers, this Security shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this Security to be duly
executed under its corporate seal.
Dated: ]
CALFED INC.
By _________________________________
Chairman of the Board
Attest:
-------------------------------
Secretary
[Form of Reverse]
This Security is one of a duly authorized issue of Securities of the
Company designated as its 6 1/2% Convertible Subordinated Debentures Due 2001
(herein called the "Securities"), limited (except as otherwise provided in the
Indenture) in aggregate principal amount to U.S.$125,000,000, issued and to be
issued under an Indenture, dated as of February 15, 1986 (herein called the
"Indenture"), between the Company and Manufacturers Hanover Trust Company, as
Trustee (herein called the "Trustee", which term includes any successor
trustee under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the
respective rights, limitations of rights, duties and immunities thereunder of
the Company, the Trustee, the holders of Senior Indebtedness and the Holders
of the Securities and any coupons appertaining thereto and of the terms upon
which the Securities are, and are to be, authenticated and delivered. The
Securities are issuable as Bearer Securities, with interest coupons attached,
in the denomination of U.S.$5,000 and as Registered Securities, without
coupons, in denominations of U.S.$5,000 and integral multiples thereof. As
provided in the Indenture and subject to certain limitations therein set
forth, [If Bearer Security -- Bearer Securities and] Registered Securities are
exchangeable for a like aggregate principal amount of Registered Securities of
any authorized denominations as requested by the Holder surrendering the same
upon surrender of the Security or Securities to be exchanged, [If Bearer
Security -- with all unmatured coupons and all matured coupons in default
thereto appertaining, except as provided below,] at the office or agency of
the Company in the Borough of Manhattan, The City of New York or, subject to
any laws or regulations applicable thereto and to the right of the Company to
terminate the appointment of any such Transfer Agent, at the main offices of
Manufacturers Hanover Bank/Belgium S.A. in Brussels and Manufacturers Hanover
Bank Luxembourg S.A. in Luxembourg, or at such other offices or agencies as
the Company may designate. [If Bearer Security -- Bearer Securities
surrendered in exchange for Registered Securities between a Regular Record
Date and the relevant Interest Payment Date will not be required to be
surrendered with the coupon relating to such Interest Payment Date.]
Registered Securities may not be surrendered in exchange for Bearer
Securities.
15
The Securities are subject to redemption at the option of the Company
(1) at any time after the expiration of 30 days following the Exchange Date,
as a whole or in part, at the following Redemption Prices (expressed as
percentages of the principal amount). If redeemed during the 12-month period
beginning February 20 of the years indicated.
REDEMPTION REDEMPTION
YEAR PRICE YEAR PRICE
---- ---------- ---- ----------
1986............. 106% 1989............. 103%
1987............. 105% 1990............. 102%
1988............. 104% 1991............. 101%
and thereafter at a Redemption Price equal to 100% of the principal amount,
and (2) under the circumstances described in the next two succeeding
paragraphs at a Redemption Price equal to 100% of the principal amount,
together in the case of any such redemption under clause (1) or (2) of this
sentence with accrued interest to the Redemption Date; provided, however, that
interest instalments on Bearer Securities whose Stated Maturity is on or prior
to such Redemption Date will be payable only upon presentation and surrender
of coupons for such interest (at an office or agency outside the United States
except as herein provided otherwise), and provided, further, that interest
instalments on Registered Securities whose Stated Maturity is on or prior to
such Redemption Date will be payable to the Holders of such Securities, or one
or more Predecessor Securities, of record at the close of business on the
relevant Regular Record Date referred to on the face hereof, all as provided
in the Indenture. Notwithstanding the foregoing, the Company may not, prior to
February 20, 1993, redeem any Securities pursuant to clause (1) of the next
preceding sentence unless the Closing Market Price Per Share (as defined in
the Indenture) of the Common Stock on each day on which there was such a price
within the 30 days immediately preceding the fifteenth day prior to the
initial publication of the notice of such redemption is at least 130% of the
Conversion Price is effect at the close of business on such day. Partial
redemptions must be in an amount not less than U.S.$1,000,000 principal amount
of Securities.
The Securities may be redeemed, as a whole but not in part, at the
option of the Company, upon notice given in the manner provided below, at a
redemption price equal to 100% of their principal amount, together with
interest accrued to the date fixed for redemption, if, as a result of any
amendment to, or change in, the laws or regulations of the United States or
any political subdivision or taxing authority thereof or therein affecting
taxation, or any amendment to or change in an official interpretation or
application of such laws or regulations by a taxing authority, court or
administrative agency, which amendment or change is effective on or after
February 20, 1986, the Company will become obligated to pay additional
amounts, as described in the second paragraph of the face of this Security, on
the next succeeding Interest Payment Date; provided, however, that, at the
time such notice is given, such obligation to pay such additional amounts
remains in effect.
In addition, if the Company determines, based upon a written opinion
of independent counsel, that any payment made outside the United States by the
Company or any of its Paying Agents of the full amount of principal (and
premium, if any) or interest due with respect to any Bearer Security or coupon
would, under any present or future laws or regulations of the United States,
be subject to any certification, identification or other information reporting
requirement of any kind, the effect of which requirement is the disclosure to
the Company, any Paying Agent or any United States governmental authority of
the nationality, residence or identity of a beneficial owner of such Bearer
Security or coupon who is a United States Alien (other than such a requirement
(a) which would not be applicable to a payment made by the Company or any one
of its Paying Agents (i) directly to the beneficial owner or (ii) to any
custodian,
16
nominee or other agent of the beneficial owner, or (b) which can be satisfied
by the custodian, nominee or other agent certifying that the beneficial owner
is a United States Alien, provided that in each case referred to in clauses
(a)(ii) and (b) payment by such custodian, nominee or other agent to such
beneficial owner is not otherwise subject to any such requirement), the
Company at its election will either (x) redeem the Securities, as a whole but
not in part, upon notice given in the manner provided below, at a redemption
price equal to 100% of their principal amount, together with interest accrued
to the date fixed for redemption, or (y) if and as long as the conditions set
forth in the third paragraph of the face of this Security are satisfied, pay
the additional amounts specified in such paragraph. The Company will make such
determination and election and notify the Trustee thereof as soon as
practicable, and the Trustee will promptly give notice of such determination
in the manner provided below (the "Determination Notice"), in each case
stating the effective date of such certification, identification or
information reporting requirement, whether the Company will redeem the
Securities or will pay the additional amounts specified is such paragraph and
(if applicable) the last date by which the redemption of the Securities must
take place. If the Company elects to redeem the Securities, such redemption
shall take place on such date, not later than one year after publication of
the Determination Notice, as the Company elects by notice to the Trustee at
least 75 days before such date, unless shorter notice is acceptable to the
Trustee. Notwithstanding the foregoing, the Company will not so redeem the
Securities if the Company, based upon an opinion of independent counsel,
subsequently determines, not less than 30 days prior to the date fixed for
redemption, that subsequent payments would not be subject to any such
requirement, in which case the Company will notify the Trustee, which will
promptly give notice of that determination in the manner provided below and
any earlier redemption notice will thereupon be revoked and of no further
effect. If the Company elects as provided in clause (y) above to pay
additional amounts, and as long as the Company is obligated to pay such
additional amounts, the Company may subsequently redeem the Securities, at any
time, as a whole but not in part, upon notice given in the manner provided
below, at 100% of these principal amount, together with interest accrued to
the date fixed for redemption, but without reduction for applicable United
States withholding taxes.
Subject to and upon compliance with the provisions of the Indenture
(unless previously redeemed by the Company and notwithstanding any prior call
for redemption at the election of the Company on a Redemption Date on or after
February 20, 1993), this Security is subject to redemption on February 20,
1993, at the election of the Holder, exercisable on or before January 20,
1993, but not prior to December 20, 1992, at a Redemption Price equal to 123%
of the principal amount to be redeemed, plus accrued interest, to the
Redemption Date. For this Security to be redeemed at the election of the
Holder hereof, the Company must receive at the office of one of the Paying and
Conversion Agents appointed by the Company on or after December 20, 1992 until
and including, but not after, the close of business on January 20, 1993, this
Security [If Bearer Security -- , together with all coupons maturing after the
Redemption Date,] accompanied by written notice to the Company (which shall be
substantially in the form of optional redemption notice hereon) that the
Holder hereof instructs the Company to redeem this Security [If Registered
Security -- , or if less than the entire amount hereof is to be redeemed, the
portion hereof to be redeemed]. The Holder of a Registered Security may elect
redemption by the Company of such Security in the principal amount of
U.S.$5,000 or an integral multiple thereof. The Holder of a Bearer Security
may elect redemption by the Company of such Security as a whole but not in
part. Such form of notice duly received shall be irrevocable; provided,
however, that Holders of Securities who provide such optional notice of
redemption shall retain the right to require such Securities to be converted
into Common Stock
17
on or prior to February 20, 1993, provided that notice of conversion and the
Holder's nontransferable receipt of deposit from the Paying and Conversion
Agent representing such Securities are delivered on or prior to the close of
business on such conversion date to the Paying and Conversion Agent holding
such Securities. In the event such Securities are converted on (but not prior
to) February 20, 1993, the Holders of the appurtenant coupons the Stated
Maturity of which is February 20, 1993 shall be entitled to receive the
interest payable on such Securities on such date. The Company shall give the
Holders of the Securities not less than 75 days nor more than 100 days notice
prior to February 20, 1993 advising such Holders of the Redemption Date for
redemption at the election of Holders.
Notice of redemption at the option of the Company and of the
Redemption Date for redemption at the election of Holders will be given by
publication in Authorized Newspapers in The City of New York, in London and,
so long as the Securities are listed on the Luxembourg Stock Exchange and such
stock exchange shall so require, in Luxembourg, or, if not practicable, in
Europe, and by mail to Holders of Registered Securities. In the case of a
redemption in whole at the election of the Company, notice will be given not
less than 30 days nor more than 60 days prior to the Redemption Date and in
the case of partial redemption at the election of the Company,notice will be
given twice, the first notice to be given not more than 75 nor less than 60
days prior to the Redemption Date and the second notice at least 20 days
thereafter but not less than 30 days prior to the Redemption Date, all as
provided in the Indenture.
In the event of a redemption in part at the option of the Company,
the Company shall not be required (i) to register the transfer of or exchange
Registered Securities or to exchange Bearer Securities for Registered
Securities for a period of 15 days immediately preceding the date notice is
given identifying the serial numbers of the Securities called for such
redemption; (ii) to register the transfer of or exchange any Registered
Security, or portion thereof, called for redemption; or (iii) to exchange any
Bearer Security called for redemption, provided, however, that a Bearer
Security called for redemption may be exchanged for a Registered Security
which is simultaneously surrendered to the Security Registrar or Transfer
Agent making such exchange with written instruction for payment consistent
with the provisions of the Indenture.
Subject to an upon compliance with the provisions of the Indenture,
the Holder of this Security is entitled, at his option, at any time on or
after the opening of business on the Exchange Date and on or before the close
of business on February 20, 2001, or in case this Security [If Registered
Security -- or a portion hereof] is called for redemption, then in respect of
this Security [If Registered Security -- or such portion hereof] until and
including, but (unless the Company defaults in making the payment due upon
redemption] not after, the close of business on the Redemption Date, to
convert this Security [If Registered Security -- (or any portion of the
principal amount hereof which is U.S.$5,000 or an integral multiple thereof)],
at the principal amount hereof [If Registered Security -- or of such portion],
into fully paid and nonassessable shares (calculated as to each conversion to
the nearest 1/100 of a share) of Common Stock of the Company at a Conversion
Price equal to U.S.$35.25 aggregate principal amount of Securities for each
share of Common Stock (or at the current adjusted Conversion Price if an
adjustment has been made as provided in the Indenture) by surrender of this
Security together with [If Bearer Security -- all unmatured coupons and any
matured coupons in default appertaining hereto] [If Registered Security -- (if
so required by the Company or the Trustee) instruments of transfer in form
satisfactory to the Company and the Security Registrar, duly executed by the
registered Holder or by his duly authorized attorney and, in case such
surrender shall be made during the period from the close of business on any
Regular Record Date next preceding any Interest Payment Date to the opening of
business on such
18
Interest Payment Date (unless this Security or the portion thereof being
converted has been called for redemption on a Redemption Date within such
period), also accompanied by payment in funds acceptable to the Company of an
amount equal to the interest payable on such interest Payment Date on the
principal amount of the Security then being converted (or, if such Registered
Security was issued in exchange for a Bearer Security after the close of
business on such Regular Record Date, by surrender of one or more coupons
relating to such Interest Payment Date or by both payment in such funds and
surrender of such coupon or coupons, in either case, in an amount equal to the
interest payable on such Interest Payment Date on the principal amount of the
Security then being converted)] and the conversion notice hereon duly executed
(a) at the Corporate Trust Office of the Trustee, or at such other office or
agency of the Company as may be designated by it for such purpose in the
Borough of Manhattan, The City of New York, or (b) subject to any laws or
regulations applicable thereto and subject to the right of the Company to
terminate the appointment of any such Conversion Agent, at the main offices of
Manufacturers Hanover Bank/Belgium S.A. in Belgium, Manufacturers Hanover Bank
Luxembourg S.A. in Luxembourg and Manufacturers Hanover Trust Company in
Frankfurt/Main and London, or at such other offices or agencies as the Company
may designate. [If Registered Security -- Subject to the aforesaid requirement
for payment and, in the case of a conversion after the Regular Record Date
next preceding any Interest Payment Date and on or before such Interest
Payment Date, to the right of the Holder of this Security (or any Predecessor
Security) of record at such Regular Record Date to receive as instalment of
interest (with certain exceptions provided in the Indenture),] [no--No]
payment or adjustment is to be made on conversion for interest secured hereon
or for dividends on the Common Stock delivered on conversion. No fractions of
shares or scrip representing fractions of shares will be issued or delivered
on conversion, but instead of any fractional interest the Company shall pay a
cash adjustment as provided in the Indenture. The Conversion Price is subject
to adjustment as provided in the Indenture. In addition, the Indenture
provides that in case of certain consolidations or mergers to which the
Company is a party or the transfer of substantially all of the assets of the
Company, the Indenture shall be amended, without the consent of any Holders of
Securities, so that this Security, if then outstanding, will be convertible
thereafter, during the period this Security shall be convertible as specified
above, only into the kind and amount of securities, cash and other property
receivable upon such consolidation, merger or transfer by a holder of the
number of shares of Common Stock into which this Security might have been
converted immediately prior to such consolidation, merger or transfer
(assuming such holder of Common Stock failed to exercise any rights of
election and received per share the kind and amount received per share by the
plurality of the non-electing shares) assuming, if such consolidation, merger
or transfer is prior to the Exchange Date, that this Security were convertible
at the time of such consolidation, merger or transfer at the initial
Conversion Price specified above as adjusted from February 20, 1986 to such
time pursuant to the Indenture.
[If Registered Security -- In the event of redemption or conversion
of this Security in part only, a new Security or Securities for the unredeemed
or unconverted portion hereof will be issued in the name of the Holder hereof
upon the cancellation hereof.]
The indebtedness evidenced by this Security and any coupons
appertaining hereto is, to the extent provided in the Indenture, subordinate
and subject in right of payment to the prior payment in full of all Senior
Indebtedness, and this Security is issued subject to the provisions of the
Indenture with respect thereto. Each Holder of this Security or any coupon
appertaining to this Security, by accepting the same, (a) agrees to and shall
be bound by such provisions of the Indenture, (b) authorizes and directs the
Trustee on his behalf to take such action as may
19
be necessary or appropriate to effectuate the subordination of this Security
as provided in the Indenture and (c) appoints the Trustee his attorney-in-fact
for any and all such purposes.
If an Event of Default shall occur and be continuing, the principal
of all the Securities may be declared due and payable in the manner and with
the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of
the Company and the rights of the Holders of the Securities and coupons under
the Indenture at any time by the Company and the Trustee with the consent of
the Holders of a majority in aggregate principal amount of the Securities at
the time Outstanding (or such lesser amount as shall have acted at a meeting
pursuant to the provisions of the Indenture). The Indenture also contains
provisions permitting the Holders of specified percentages in aggregate
principal amount of the Securities at the time Outstanding, on behalf of the
Holders of all the Securities and coupons, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and any coupon appertaining hereto and of any
Security issued [If Registered Security -- upon registration of transfer
hereof or] in exchange herefor or in the lien hereof, whether or not notation
of such consent or waiver is made upon this Security or such other Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of (and
premium, if any) and interest (including additional amounts, as described on
the face hereof) on this Security at the times, places and rate, and in the
coin or currency, herein prescribed or to convert this Security as provided in
the Indenture.
Title to Bearer Securities and coupons shall pass by delivery. As
provided in the Indenture and subject to certain limitations therein set
forth, the transfer of Registered Securities is registrable on the Security
Register upon surrender of a Registered Security for registration of transfer
at the Corporate Trust Office of Manufacturers Hanover Trust Company, as
Security Registrar, in the Borough of Manhattan, The City of New York or,
subject to any laws or regulations applicable thereto and to the right of the
Company to terminate the appointment of any such Transfer Agent, at the main
offices of Manufacturers Hanover Bank/Belgium S.A. in Brussels and
Manufacturers Hanover Bank Luxembourg S.A. in Luxembourg, or at such other
offices or agencies as the Company may designate, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar or any such Transfer Agent, as the case may
be, duly executed by, the Holder thereof or his attorney duly authorized in
writing, and thereupon one or more new Registered Securities, of authorized
denominations and for the same aggregate principal amount, will be issued to
the designated transferee or transferees. No service charge shall be made for
any such registration of transfer or exchange, but the Company may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
The Company, the Trustee and any agent of the Company or the Trustee
may treat the bearer of a Bearer Security and any coupon appertaining thereto
and, prior to due presentment for registration of transfer, the Person in
whose name a Registered Security is registered as the owner thereof for all
purposes, whether or not the Security or coupon be overdue, and neither the
Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
20
The Indenture, the Securities and any coupons appertaining thereto
shall be governed by and construed in accordance with the laws of the State of
New York.
All terms used in this Security which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
[FORM OF NOTICE OF REDEMPTION AT HOLDER'S OPTION]
To: CALFED INC.
The undersigned Holder of this Security hereby irrevocably instructs
the Company to redeem this Security [If Registered Security --, or portion
hereof in the principal amount below designated,] in accordance with the terms
of the Indenture referred to in this Security [If Registered Security --, and
directs that any Registered Securities representing any principal amount
hereof which is not to be redeemed in accordance with these instructions be
issued and delivered to the registered Holder hereof unless a different name
has been indicated below].
Dated: ____________________________
[If Registered Security -- ___________________________________
Fill in for registration of Registered Signature
Securities if to be issued otherwise
than to the registered Holder. [If Registered Security --
Principal amount to be redeemed (in
___________________________________ an integral multiple of U.S.$5,000,
Name if less than all):
-----------------------------------
Address $____________]
-----------------------------------
(Please print name and address,
including zip code number)]
Note: Exercise of the option to elect redemption is irrevocable,
except that Holders who provide the foregoing notice retain
the right to require the Securities tendered herewith to be
converted, provided that notice to such effect and the
Holder's nontransferable receipt from a Paying and
Conversion Agent representing such Securities are delivered
on or prior to February 20, 1993, to the Paying and
Conversion Agent holding the tendered Securities to be
converted. In the event tendered Securities are converted on
(but not prior to) February 20, 1993, the Holder [If Bearer
Security-- of the coupon the Stated Maturity of which is
such date] will be entitled to receive the interest payable
[If Registered Security-- on such Securities] on that date.
SECTION 203. Form of Temporary Global Security.
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933. NEITHER THIS SECURITY NOR ANY PORTION HEREOF MAY BE
OFFERED OR SOLD DIRECTLY OR INDIRECTLY IN THE UNITED STATES OF AMERICA, ITS
TERRITORIES OR POSSESSIONS ("UNITED STATES") OR TO NATIONALS OR RESIDENTS
THEREOF, TO ANY CORPORATION, PARTNERSHIP OR OTHER ENTITY CREATED OR ORGANIZED
IN OR UNDER THE LAWS OF THE UNITED STATES OR ANY POLITICAL SUBDIVISION THEREOF
OR TO ANY ESTATE OR TRUST WHICH IS SUBJECT TO UNITED STATES FEDERAL INCOME
TAXATION REGARDLESS OF THE SOURCE OF ITS INCOME ("UNITED STATES PERSONS").
21
CALFED INC.
6 1/2% CONVERTIBLE SUBORDINATED DEBENTURE DUE 2001
TEMPORARY GLOBAL SECURITY
CALFED INC., a corporation duly organized and existing under the laws
of the State of Delaware (herein called the "Company", which term includes any
successor corporation under the Indenture hereinafter referred to), for value
received, hereby promises to pay to bearer upon presentation and surrender of
this Global Security the principal sum of ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ Dollars on February 20, 2001 and to pay interest thereon, from
the date hereof, annually in arrears on February 20 in each year, commencing
February 20, 1987, at the rate of 6 1/2% per annum, until principal hereof is
paid or made available for payment; provided, however, that interest on this
Global Security shall be payable only after the issuance of the definitive
Securities for which this Global Security is exchangeable and, in the case of
definitive Securities in bearer form, only upon presentation and surrender (at
an office or agency outside the United States, except as otherwise provided in
the Indenture referred to below) of the interest coupons thereto attached as
they severally mature.
This Global Security is one of a duly authorized issue of Securities
of the Company designated as specified in the title hereof, issued and to be
issued under the Indenture, dated as of February 15, 1986 (herein called the
"Indenture"), between the Company and Manufacturers Hanover Trust Company, as
Trustee (herein called the "Trustee", which term includes any successor
trustee under the Indenture). It is a temporary security and is exchangeable
in whole or from time to time in part without charge upon request of the
Holder hereof for definitive Securities in bearer form, with interest coupons
attached, or in registered form, without coupons, of authorized denominations,
(a) not earlier than 90 days after the date on which the distribution of the
Securities has been completed as Credit Suisse First Boston Limited shall have
advised the Trustee in writing and (b) as promptly as practicable following
presentation of certification, in the form set forth in the Indenture for such
purpose, that the beneficial owner or owners of this Global Security (or, if
such exchange is only for a part of this Global Security, of such part) are
not United States Persons. Definitive Securities in bearer form to be
delivered in exchange for any part of this Global Security shall be delivered
only outside the United States. Upon any exchange of a part of this Global
Security for definitive Securities, the portion of the principal amount hereof
so exchanged shall be endorsed by the Trustee on the Schedule hereto, and the
principal amount hereof shall be reduced for all purposes by the amount so
exchanged.
Until exchanged in full for definitive Securities, this Global
Security shall in all respects be entitled to the same benefits under, and
subject to the same terms and conditions of, the Indenture as definitive
Securities authenticated and delivered thereunder, except that neither the
Holder hereof nor the beneficial owners of this Global Security shall be
entitled to receive payment of interest hereon or to convert this Global
Security into Common Stock of the Company or any other security, cash or other
property.
This Global Security shall be governed by and construed in accordance
with the laws of the State of New York.
All terms used in this Global Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
Unless the certificate of authentication hereon has been executed by
the Trustee by the manual signature of one of its authorized officers, this
Global Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
22
IN WITNESS WHEREOF, the Company has caused this Global Security to be
duly executed under its corporate seal.
Dated as of February 20, 1986
CALFED INC.
By __________________________________
Chairman of the Board
Attest:
-------------------------------------
Secretary
SCHEDULE OF EXCHANGES
REMAINING
PRINCIPAL PRINCIPAL
AMOUNT AMOUNT NOTATION MADE
DATE EXCHANGED FOR FOLLOWING ON BEHALF OF THE
MADE DEFINITIVE SECURITIES SUCH EXCHANGE TRUSTEE
-------- --------------------- ------------- ----------------
======== ===================== ================ =============
======== ===================== ================ =============
======== ===================== ================ =============
======== ===================== ================ =============
======== ===================== ================ =============
======== ===================== ================ =============
SECTION 204. Form of Coupon.
[FORM OF FACE]
ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO
LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS, INCLUDING THE LIMITATIONS
PROVIDED IN SECTIONS 165(j) AND 1287(a) OF THE INTERNAL REVENUE CODE.
23
NO.
CALFED INC. U.S.$
DUE
6 1/2% CONVERTIBLE SUBORDINATED DEBENTURE DUE 2001
Unless the Security to which this coupon appertains shall have been
called for previous redemption and payment thereof duly provided for or
converted on the date set forth hereon. CALFED INC. (herein called the
"Company") will pay to bearer, upon surrender hereof, the amount shown hereon
(together with any additional amounts in respect thereof which the Company may
be required to pay according to the terms of said Security and the Indenture
referred to therein) at the Paying Agents set out on the reverse hereof or at
such other places (which, except as otherwise provided in the Security to
which this coupon appertains, shall be located outside the United States of
America, its territories and possessions) as the Company may determine from
time to time, by United States dollar check drawn on a bank in The City of New
York, or by transfer to a United States dollar account maintained by the payee
with a bank located in a European city, being one year's interest then payable
on said Security.
By __________________________________
Treasurer
[Reverse of Coupon]
Manufacturers Hanover Manufacturers Hanover Bank
Bank/Belgium S.A. Luxembourg ▇.▇.
▇▇▇ ▇▇ ▇▇▇▇▇, ▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
B-1000 Brussels Luxembourg
Belgium
Manufacturers Hanover Manufacturers Hanover Trust
Trust Company Company
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇-▇▇ ▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇/▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
Federal Republic of Germany England
Manufacturers Hanover Trust Company
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇
▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇
SECTION 205. Form of Trustee's Certificate of Authentication.
This is one of the Securities referred to in the within-mentioned
Indenture.
MANUFACTURERS HANOVER TRUST COMPANY
as Trustee
By __________________________________
Authorized Officer
24
SECTION 206. Forms of Conversion Notice.
CONVERSION NOTICE
[If Bearer Security --
The undersigned Holder of this Security hereby irrevocably exercises
the option to convert this Security into shares of Common Stock in accordance
with the terms of the Indenture referred to in this Security and directs that
such shares be registered in the name of and delivered, together with a check
in payment for any fractional share, to the undersigned unless a different
name has been indicated below. If shares are to be registered in the name of a
Person other than the undersigned, the undersigned will pay all transfer taxes
payable with respect thereto.
Dated: ________________________
-------------------------------------
Signature
If shares are to be registered in HOLDER
the name of and delivered to a Person
other than the Holder, please print
such Person's name & address: Please print name & address of Holder:
------------------------------------- -------------------------------------
------------------------------------- -------------------------------------
------------------------------------- -------------------------------------]
[If Registered Security --
The undersigned Holder of this Security hereby irrevocably exercises
the option to convert this Security, or portion hereof (which is U.S.$5,000 or
an integral multiple thereof) below designated, into shares of Common Stock in
accordance with the terms of the Indenture referred to in this Security,
delivers herewith the amount of interest payable on the next Interest Payment
Date if this conversion is made between the Regular Record Date for such
Interest Payment Date and such Interest Payment Date, and directs that such
shares, together with a check is payment for any fractional share and any
Securities representing any unconverted principal amount hereof, be delivered
to and be registered in the name of the undersigned unless a different name
has been indicated below. If shares or Securities are to be registered in the
name of a Person other than the undersigned, the undersigned will pay all
transfer taxes payable with respect thereto.
Dated: __________________
-------------------------------------
Signature
25
If shares or Securities are to be If only a portion of the Securities
registered in the name of a Person is to a converted, please indicate:
other than the Holder, please print
such Person's name & address: 1. Principal Amount to be
converted: U.S.$_____________
____________________________________ 2. Amount and denomination of
____________________________________ Registered Securities
____________________________________ representing unconverted
principal amount to be issued:
Amount: U.S.$________________
Denominations: U.S.$_________
(U.S.$5,000 or an integral multiple
thereof)]
ARTICLE THREE
THE SECURITIES
SECTION 301. Title and Terms.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is limited to
U.S.$125,000,000 except for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of other
Securities pursuant to Section 304, 305, 306, 405, 1108, 1296 or 1802.
The Securities shall be known and designated as the "6 1/2%
Convertible Subordinated Debentures Due 2001" of the Company. Their Stated
Maturity shall be February 20, 2001, and they shall bear interest at the rate
of 6 1/2% per annum from February 20, 1986 payable annually in arrears on
February 20 in each year, commencing February 20, 1987, until the principal
thereof is paid or made available for payment.
The principal of (and premium, if any) and interest on the Securities
shall be payable as provided in the forms of Securities set forth in Section
202 (any city in which any Paying Agent is located being herein called a
"Place of Payment").
The Securities shall be redeemable at the option of the Company as
provided in Article Eleven.
The Securities shall be redeemable at the option of the Holders as
provided in Article Twelve.
The Securities shall be convertible as provided in Article Thirteen
(any city in which any Conversion Agent is located being herein called a
"Place of Conversion").
The Securities shall be subordinated in right of payment to Senior
Indebtedness as provided in Article Fourteen.
SECTION 302. Denominations.
The definitive Securities shall be issuable in bearer form, with
interest coupons attached, in the denomination of U.S.$5,000 and in fully
registered form, without coupons, in the denominations of U.S.$5,000 and
integral multiples thereof.
26
SECTION 303. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by its
Chairman of the Board, its President or one of its Vice Presidents, under its
corporate seal reproduced thereon attested by its Secretary or one of its
Assistant Secretaries. The signature of any of these officers on the
Securities may be manual or facsimile. Coupons shall bear the facsimile
signature of the Treasurer or any Assistant Treasurer of the Company.
Securities and coupons bearing the manual or facsimile signature of
any Person who was at any time a proper officer of the Company shall bind the
Company, notwithstanding that such Person has ceased to hold such office prior
to the authentication and delivery of such Securities or did not hold such
office at the date of such Securities.
At any time and from time to time after the execution and delivery of
the Indenture, the Company may deliver Securities executed by the Company to
the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities; and the Trustee in accordance
with the Company Order shall authenticate and deliver such Securities as in
this Indenture provided and not otherwise.
Each Bearer Security and the Global Security shall be dated as of the
date of this Indenture. Each Registered Security shall be dated the date of
its authentication.
No Security or coupon 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. Except as permitted by Section 304, 306 or 307, the Trustee shall
not authenticate and deliver any Bearer Security unless all appurtenant
coupons for interest then matured have been detached and cancelled.
SECTION 304. Temporary Global Security Exchange of Temporary Global
Security for Definitive Securities.
The Securities shall be issued initially in the form of one temporary
Global Security, which temporary Global Security shall be deposited on behalf
of the subscribers for the Securities with the London office of The Chase
Manhattan Bank (National Association), as common depositary (the "Common
Depositary"), for credit to their respective accounts (or to such other
accounts as they may direct) at ▇▇▇▇▇▇ Guaranty Trust Company of New York,
Brussels Office, as operator of the Euro-clear System ("Euro-clear") or CEDEL
S.A.
Without unnecessary delay but in any event not more than 90 days
after the date on which the distribution of the Securities has been completed,
as Credit Suisse First Boston Limited shall have advised the Trustee in
writing, the Company shall deliver to the Trustee definitive Securities in
aggregate principal amount equal to the principal amount of the Global
Security, executed by the Company. Such definitive Securities shall be in the
form of Bearer Securities or Registered Securities, or any combination
thereof, as may be specified by the Trustee. On or after the Exchange Date the
Global Security shall be surrendered by the Common Depositary to the Trustee,
as the Company's agent for such purpose, to be exchanged, in whole or from
time to time in part, for definitive Securities without charge and the Trustee
shall authenticate and deliver in exchange for the Global Security or the
portions thereof to be exchanged, an equal aggregate principal amount of
definitive Securities in the form of Bearer Securities or Registered
Securities, or any combination thereof, as shall be specified by the
beneficial owner
27
thereof, provided, however, that upon such presentation by the Common
Depositary, the Global Security is accompanied by a certificate dated the
Exchange Date or a subsequent date and signed by Euro-clear as to the portion
of the Global Security held for its account then to be exchanged and a
certificate dated the Exchange Date or a subsequent date and signed by CEDEL
S.A. as to the portion of the Global Security held for its account then to be
exchanged, each to the effect hereinafter provided. The Company hereby
appoints the main office of the Trustee in London as its agent outside the
United States where Bearer Securities may be delivered in exchange for the
Global Security or portions thereof. Notwithstanding any other provision
hereof or of the Securities, no Bearer Security will be mailed to or otherwise
delivered in connection with its original issuance to any location within the
United States.
Each certificate to be provided by Euro-clear and CEDEL S.A. upon
exchange of a portion of the Global Security shall be substantially to the
following effect or with such changes therein as shall be approved by the
Company and Credit Suisse First Boston Limited.
[Form of certificate to be given by Euro-clear and CEDEL S.A.]
CERTIFICATE
CALFED INC.
6 1/2% CONVERTIBLE SUBORDINATED DEBENTURES DUE 2001
This is to certify with respect to U.S.$ principal amount of the
above-captioned Securities (i) that we have received from each of the persons
appearing in our records as persons entitled to a portion of such principal
amount (our "Qualified Account Holders") a certificate with respect to each
portion substantially in the form set out below, and (ii) that we are not
submitting herewith for exchange any portion of the Global Security
representing the above-captioned Securities excepted in such certificates.
We further certify that as of the date hereof we have not received
any notification from any of our Qualified Account Holders to the effect that
the statements made by such Qualified Account Holders with respect to any
portion of the part submitted herewith for exchange are no longer true and
cannot be relied upon as of the date hereof.
Dated: , 19 *
[▇▇▇▇▇▇ GUARANTY TRUST COMPANY OF NEW
YORK, BRUSSELS OFFICE, AS OPERATOR OF
THE EURO-CLEAR CLEARANCE SYSTEM]
[CEDEL, S.A.]
By __________________________________
-------------
* To be dated no earlier than the Exchange Date.
Each certificate received by Euro-clear and CEDEL S.A. from persons
appearing in their records as persons entitled to a portion of the Global
Security shall be substantially to the following offset or with such changes
therein as shall be approved by the Company and Credit Suisse First Boston
Limited.
28
[Form of certificate to be given by Qualified Account Holders]
CERTIFICATE
CALFED INC.
6 1/2% CONVERTIBLE SUBORDINATED DEBENTURES DUE 2001
This is to certify that as of the date hereof and except as provided
in the third paragraph hereof, none of the above-captioned Securities held by
you for our account is beneficially owned by nationals or residents of the
United States, by any corporation, partnership or other entity created or
organized in or under the laws of the United States or any political
subdivision thereof or by any estate or trust which is subject to United
States Federal income taxation regardless of the source of its income. As used
herein, "United States" means the United States of America, its territories
and possessions.
We undertake to advise you by telex if the above statement as to
beneficial ownership is not correct on [Insert a date which is the Exchange
Date] as to all of the above-captioned Securities then appearing in your books
as being held for our account.
This certificate excepts and does not relate to U.S.$ principal
amount of the above-captioned Securities appearing in your books as being held
for our account but which we have sold or as to which we are not yet able to
certify and as to which we understand exchange and delivery of definitive
Securities cannot be made until we are able so to certify.
We understand that this certificate is required in connection with
certain securities and tax legislation in the United States. If administrative
or legal proceedings are commenced or threatened in connection with which this
certificate is or would be relevant, we irrevocably authorize you to produce
this certificate or a copy thereof to any interested party in such
proceedings.
-------------------------------------
Account Holder
Dated
------------
* To be dated on or after the 15th day before the Exchange Date.
Upon any such exchange of a portion of the Global Security for definitive
Securities, the Global Security shall be endorsed to reflect the reduction of
the principal amount evidenced thereby. Until so exchanged in full, the Global
Security shall in all respects be entitled to the same benefits under, and
subject to the same terms and conditions of, this Indenture as definitive
Securities authenticated and delivered hereunder, except that none of
Euro-clear, CEDEL, S.A. or the beneficial owners of the Global Security shall
be entitled to receive payment of interest thereon or to convert the Global
Security into Common Stock of the Company or any other security, cash or other
property.
SECTION 305. Registration, Registration of Transfer and Exchange.
The Company shall come to be kept at the Corporate Trust Office of
the Trustee a register (the register maintained in such office and in any
other office or agency designated pursuant to Section 1002 as a Transfer Agent
being herein sometimes collectively 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 Registered Securities and of transfers
of
29
Registered Securities. The Trustee and each Transfer Agent are hereby
appointed "Security Registrars" for the purpose of registering Registered
Securities and transfers of Registered Securities as herein provided.
Upon surrender for registration of transfer of any Registered
Security at an office or agency of the Company designated pursuant to Section
1002 for such purpose, the Company shall execute, and the Trustee shall
authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Registered Securities of any authorized
denominations and of a like aggregate principal amount.
At the option of the Holder, Bearer Securities may be exchanged for
Registered Securities of any authorized denominations and of a like aggregate
principal amount, upon surrender of the Bearer Securities to be exchanged at
any such office or agency, with all unmatured coupons and all matured coupons
in default thereto appertaining. If the Holder of a Bearer Security is unable
to produce any such unmatured coupon or coupons or matured coupon or coupons
in default, such exchange may be effected if the Bearer Securities are
accompanied by payment in funds acceptable to the Company in an amount equal
to the face amount of such missing coupon or coupons or the surrender of such
missing coupon or coupons may be waived by the Company and the Trustee, if
there be furnished to them such maturity or indemnity as they may require to
have each of them and any Paying Agent harmless. If thereafter the Holder of
such Security shall surrender to any Paying Agent any such missing coupon in
respect of which such a payment shall have been made, such Holder shall be
entitled to receive the amount of such payment; provided, however, that,
except as otherwise provided in the forms of Security set forth in Section
202, interest represented by coupons shall be payable only upon presentation
and surrender of those coupons at an office or agency outside the United
States. Notwithstanding the foregoing, in case a Bearer Security is
surrendered in exchange for a Registered Security at an office or agency
designated pursuant to Section 1002 after the close of business at such office
or agency on (i) any Regular Record Date and before the opening of business at
such office or agency on the next succeeding Interest Payment Date, or (ii)
any Special Record Date and before the opening of business at such office or
agency on the related date for payment of Defaulted Interest, such Bearer
Security shall be surrendered without the coupon relating to such Interest
Payment Date or proposed date of payment, as the case may be.
At the option of the Holder, Registered Securities may be exchanged
for other Registered Securities of any authorized denominations and of a like
aggregate principal amount, upon surrender of the Securities to be exchanged
at any such office or agency. Whenever any Registered Securities are so
surrendered for exchange, the Company shall execute, and the Trustee shall
authenticate and deliver, the Registered Securities which the Holder making
the exchange is entitled to receive, Registered Securities may not be
surrendered in exchange for Bearer Securities.
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 Registered Security presented or surrendered for registration
of transfer or for exchange shall (if so required by the Company or the
Trustee) be duly endorsed, or be accompanied by a written instrument of
transfer in form satisfactory to the Company and the Security Registrar duly
executed, by the Holder thereof or his attorney duly authorized in writing.
30
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed
in connection with any registration of transfer or exchange of Securities,
other than exchanges pursuant to Section 304, 305, 1108, 1206, 1302 not
involving any transfer.
The Company shall not be required (i) to register the transfer of or
exchange Registered Securities or to exchange Bearer Securities for Registered
Securities for a period of 15 days immediately preceding the date notice is
given identifying the serial numbers of the Securities called for such
redemption, or (ii) to register the transfer of or exchange any Registered
Security, or portion thereof, called for redemption, or (iii) to exchange any
Bearer Security called for redemption, provided, however, that a Bearer
Security called for redemption may be exchanged for a Registered Security
which is simultaneously surrendered to the Security Registrar or Transfer
Agent making such exchange with written instruction for payment consistent
with the provisions of this Indenture.
SECTION 306. Mutilated, Destroyed, Lost or Stolen Securities and
Coupons.
If any mutilated Security or a Security with a mutilated coupon
appertaining to it is surrendered to the Trustee, the Company shall execute
and the Trustee shall authenticate and deliver in exchange therefor a new
Security of like tenor and principal amount and bearing a number not
contemporaneously outstanding, with coupons corresponding to the coupons, if
any, appertaining to the surrendered Security.
If there shall be delivered to the Company and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any
Security or coupon, and (ii) such security or indemnity as may be required by
them to save each of them and any agent of either of them harmless, then, in
the absence of notice to the Company or the Trustee that such Security or
coupon has been acquired by a bona fide purchaser, the Company shall execute
and upon Company Request the Trustee shall authenticate and deliver, in lieu
of any such destroyed, lost or stolen Security or in exchange for the Security
to which such coupon appertains (with all appurtenant coupons not destroyed,
lost or stolen), a new Security of like tenor and principal amount and bearing
a number not contemporaneously outstanding, with coupons corresponding to the
coupons, if any, appertaining to such destroyed, lost or stolen Security or to
the Security to which such destroyed, lost or stolen coupon appertains.
In case any such mutilated, destroyed, lost or stolen Security or
coupon 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 or
coupon; provided, however, that, except as otherwise provided in the forms of
Security set forth in Section 202, the principal of (and premium, if any) and
interest on Bearer Securities shall be payable only at an office or agency
outside the United States and, in the case of interest (but not in the case of
any additional amounts payable as provided in Section 1004), only upon
presentation and surrender of the coupons appertaining thereto.
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 with its coupons, if any, issued pursuant to this
Section in lieu of any destroyed, lost or stolen Security, or in exchange for
a Security to which a destroyed, lost or
31
stolen coupon appertains, shall constitute an original additional contractual
obligation of the Company, whether or not the destroyed, lost or stolen
Security and its coupons, if any, or the destroyed, lost or stolen coupon
shall be at any time enforceable by anyone, and such new Security and coupons,
if any, shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Securities and coupons 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 or
coupons.
SECTION 307. Payment of Interest; Interest Rights Preserved.
Interest on any Registered 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. In case a Bearer Security is surrendered in exchange for a
Registered Security at an office or agency of the Company designated pursuant
to Section 1002 for the purpose after the close of business (at such office or
agency) on any Regular Record Date and before the opening of business (at such
office or agency) on the next succeeding Interest Payment Date, such Bearer
Security shall be surrendered without the coupon relating to such Interest
Payment Date and interest will not be payable on such Interest Payment Date in
respect of the Registered Security issued in exchange for such Bearer Security,
but will be payable only to the Holder of such coupon when due.
Any interest on any Registered 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 Holder
on the relevant Regular Record Date by virtue of having been such Holder, and
such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in Clause (1) or (3) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Registered 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 Registered 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 days and
not less than 10 days prior to the date of the proposed payment and
not less then 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 the
mailed, first-class postage prepaid, to each Holder of Registered
Securities at the address of such Holder 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 so mailed, such
Defaulted Interest shall be paid to the Persons
32
in whose names the Registered Securities (or their respective
Predecessor Securities) are registered at the close of business on
such Special Record Date and shall no longer be payable pursuant to
the following Clause (2). in case a Bearer Security is surrendered in
exchange for a Registered Security at an office or agency of the
Company designated pursuant to Section 1002 for the purpose after the
close of business (at such office or agency) on any Special Record
Date and before the opening of business (at such office or agency) on
the related proposed date for payment of Defaulted Interest, such
Bearer Security shall be surrendered without the coupon relating to
such proposed date of payment and Defaulted Interest will not be
payable on such proposed date of payment in respect of the
Registered Security issued in exchange for such Bearer Security, but
will be payable only to the Holder of such coupon.
(2) The Company may make payment of any Defaulted Interest
in any other lawful manner not inconsistent with the requirements of
any securities exchange on which the 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.
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
secured and unpaid, and to accrue, which were carried by such other Security.
In the case of any Registered Security which is converted after any
Regular Record Date and on or prior to the next succeeding Interest Payment
Date (other than any Registered Security whose Maturity is prior to such
Interest Payment Date), interest whose Stated Maturity is on such Interest
Payment Date shall be payable on such Interest Payment Date notwithstanding
such conversion, and such interest (whether or not punctually paid or duly
provided for) shall be paid to the Person in whose name that Registered
Security (or one or more Predecessor Securities) is registered at the close of
business on such Regular Record Date. Except as otherwise expressly provided
in the immediately preceding sentence, in the case of any Security which is
converted, interest whose Stated Maturity is after the date of conversion of
such Security shall not be payable.
SECTION 308. Persons Deemed Owners.
The Company, the Trustee and any agent of the Company or the Trustee
may treat the bearer of any Bearer Security or the Global Security and the
bearer of any coupon as the absolute owner of such Security or coupon for the
purpose of receiving payment thereof or on account thereof and for all other
purposes whatsoever, whether or not such Security or coupon 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. Prior to due presentment of a
Registered Security for registration of transfer, the Company, the Trustee and
any agent of the Company or the Trustee may treat the Person in whose name
such Security is registered as the owner of such Security for the purpose of
receiving payment of principal of (and premium, if any) and (subject to
Section 307) 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.
33
SECTION 209. Cancellation.
All Securities and coupons surrendered for payment, redemption,
conversion, registration of transfer or exchange shall if surrendered to any
Person other than the Trustee, be delivered to the Trustee. All Registered
Securities and matured coupons so delivered shall be cancelled promptly by the
Trustee. All Bearer Securities and unmatured coupons so delivered shall be
held by the Trustee and, upon instruction by a Company Order, shall be
cancelled or held for reissuance. Bearer Securities and unmatured coupons held
for reissuance may be reissued only in replacement of mutilated, lost, stolen
or destroyed Securities or coupons pursuant to Section 306. All Bearer
Securities and unmatured coupons held by the Trustee pending such cancellation
or reissuance shall be deemed to be delivered for cancellation for all
purposes of this Indenture and the Securities. The Company may at any time
deliver to the Trustee for cancellation 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
cancelled or held for reissuance as hereinabove provided. No Securities shall
be authenticated in lieu of or in exchange for any Securities cancelled as
provided in this Section, except as expressly permitted by this Indenture. All
cancelled Securities and coupons held by the Trustee shall be destroyed and
the Trustee shall furnish to the Company a certificate with respect to such
destruction, except that the cancelled Global Security and certificates
referred to in Section 304 shall not be destroyed but shall be delivered to
the Company.
SECTION 310. Computation of Interest.
Interest on the Securities shall be computed on the basis of a year
of twelve 30-day months.
ARTICLE FOUR
SATISFACTION AND DISCHARGE
Section 401. Satisfaction and Discharge of Indenture.
This Indenture shall cease to be of further effect (except as to any
surviving rights of conversion, registration of transfer or exchange of
Securities herein expressly provided for, and any right to receive additional
amounts under the second or third paragraph on the face of the forms of
Securities set forth in Section 202), and the Trustee, on demand of and at the
expense of the Company, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered
and all coupons appertaining thereto (other than (i) coupons
appertaining to Bearer Securities surrendered for exchange for
Registered Securities and maturing after such exchange, whose
surrender is not required or has been waived as provided in ▇▇▇▇▇▇▇
▇▇▇, (▇▇) Securities and coupons which have been destroyed, lost or
stolen and which have been replaced or paid as provided in ▇▇▇▇▇▇▇
▇▇▇, (▇▇▇) coupons appertaining to Securities called for redemption
and maturing after the relevant Redemption Date, whose surrender has
been waived as provided in Section 1107 or Section 1205, and (iv)
Securities and coupons for whose payment money has theretofore been
deposited in trust or segregated and held in trust by the Company and
thereafter repaid to the Company or discharged from such trust, as
provided in Section 1003) have been delivered to the Trustee for
cancellation; or
34
(B) all such Securities not theretofore delivered to the
Trustee for cancellation
(i) have become due and payable or
(ii) will become due and payable at their Stated
Maturity within one year, or
(iii) are to be called for redemption within one year
under arrangements satisfactory to the Trustee for the
giving of notice of redemption by the Trustee in the name,
and at the expense, of the Company;
and the Company, in the case of (i), (ii) or (iii) above, has
deposited or caused to be deposited with the Trustee as trust funds
in trust for the purpose an amount sufficient to pay and discharge
the entire indebtedness, on such Securities and coupons not
theretofore delivered to the Trustee for cancellation, for principal
(and premium, if any) and interest to the date of such deposit (in
the case of 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; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to the satisfaction
and discharge of this Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 606 shall survive and,
if money shall have been deposited with the Trustee pursuant to Clause (1)(B)
of this Section, the obligations of the Trustee under Section 402 and the last
paragraph of Section 1003 shall survive.
SECTION 402. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 1003, all
money deposited with the Trustee pursuant to Section 401 shall be held in
trust and applied by it, in accordance with the provisions of the Securities,
the coupons 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. All moneys deposited with the Trustee pursuant to Section
401 (and held by it or any Paying Agent) for the payment of Securities
subsequently converted shall be returned to the Company upon Company Request.
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default.
"Event of Default", wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
shall be occasioned by the provisions of Article Fourteen or be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
35
(1) default in the payment of any interest upon any Security
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 at its Maturity; or
(3) default in the performance, or breach of any covenant or
warranty of the Company in this Indenture (other than a covenant or
warranty a default in whose performance or whose breach is elsewhere
in this Section specifically dealt with), and continuance of such
default or breach for a period of 60 days after there has been given,
by registered or certified mail, to the Company by the Trustee or to
the Company and the Trustee by the Holders of at least 25% in
principal amount of the Outstanding Securities 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
(4) default under any bond, debenture, note or other
evidence of indebtedness for money borrowed by the Company or any
Principal Subsidiary or under any mortgage, indenture or instrument
under which there may be issued or by which there may be secured or
evidenced any indebtedness for money borrowed by the Company or any
Principal Subsidiary, whether such indebtedness now exists or shall
hereafter be created, which default shall constitute a failure to pay
any portion of the principal of such indebtedness when due and
payable after the expiration of any applicable grace period with
respect thereto or shall have resulted in such indebtedness becoming
or being declared due and payable prior to the date on which it would
otherwise have become due and payable, and the aggregate amount of
any and all issues of such indebtedness exceeds U.S.$10,000,000
without such indebtedness having been discharged, or such
acceleration having been rescinded or annulled, within a period of 10
days after there shall have been given, by registered or certified
mail, to the Company by the Trustee or to the Company and the Trustee
by the Holders of at least 25% in principal amount of the Outstanding
Securities a written notice specifying such default and requiring the
Company to cause such indebtedness to be discharged or cause such
acceleration to be rescinded or annulled and stating that such notice
is a "Notice of Default" hereunder; or
(5) the entry by a court having jurisdiction in the premises
of (A) a decree or order for relief in respect of the Company or any
Principal Subsidiary in an involuntary case or proceeding under any
applicable United States Federal or State bankruptcy, insolvency,
reorganization or other similar law or (B) a decree or order
adjudging the Company or any Principal Subsidiary a bankrupt or
insolvent, or approving as properly filed a petition seeking
reorganization, arrangement, adjustment or composition of or in
respect of the Company or any Principal Subsidiary under any
applicable United States Federal or State law, or appointing a
custodian, receiver, liquidator, assignee, trustee, sequestrator or
other similar official of the Company or any Principal Subsidiary or
of any substantial part of its property, or ordering the winding up
or liquidation of its affairs, and the continuance of any such decree
or order for relief or any such other decree or order unstayed and in
effect for a period of 60 consecutive days; or
(6) the commencement by the Company or any Principal
Subsidiary of a voluntary case or proceeding under any applicable
United States Federal or State bankruptcy, insolvency, reorganization
or other similar law or of any other case or proceeding to be
adjudicated a bankrupt or insolvent, or the consent by the Company or
any Principal Subsidiary to the entry of a decree or order for relief
in respect of the Company or any
36
Principal Subsidiary in an involuntary case or proceeding under any
applicable United States Federal or State bankruptcy, insolvency,
reorganization or other similar law or to the commencement of any
bankruptcy or insolvency case or proceeding against the Company or
any Principal Subsidiary, or the filing by the Company or any
Principal Subsidiary of a petition or answer or consent seeking
reorganization or relief under any applicable United States Federal
or State law, or the consent by the Company or any Principal
Subsidiary to the filing of such petition or to the appointment of or
the taking possession by a custodian, receiver, liquidator, assignee,
trustee, sequestrator or similar official of the Company or any
Principal Subsidiary or of any substantial part of its property, or
the making by the Company or any Principal Subsidiary of an
assignment for the benefit of creditors, or the admission by the
Company or any Principal Subsidiary 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 Principal Subsidiary in
furtherance of any such action.
SECTION 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default occurs and is continuing, then and in every
such case the Trustee or the Holders of not less than 25% in principal amount
of the Outstanding Securities may declare the principal of all the Securities
to be due and payable immediately, by a notice in writing to the Company (and
to the Trustee if given by Holders), and upon any such declaration such
principal amount shall become immediately due and payable.
At any time after such a declaration of acceleration has been made
and before a judgment or decree for payment of the money due has been obtained
by the Trustee as hereinafter in this Article provided, the Holders of a
majority in principal amount of the Outstanding Securities (or such lesser
amount as shall have acted at a meeting pursuant to the provisions of this
Indenture, provided that such lesser amount is more than the principal amount,
if any, of the Outstanding Securities whose Holders shall have given written
notice of such declaration), 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 interest on all Securities,
(B) the principal of (and premium, if any, on) any
Securities which have become due otherwise than by such
declaration of acceleration and interest thereon at the rate
borne by the Securities,
(C) to the extent that payment of such interest is
lawful, interest upon overdue interest at the rate borne by
the Securities, and
(D) all sums paid or advanced by the Trustees
hereunder and the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and
counsel;
and
(2) All Events of Default, other than the non-payment of the
principal of Securities which have become due solely by such
declaration of acceleration, have been cured or waived as provided in
Section 513.
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No such rescission or annulment shall affect any subsequent default or impair
any right consequent thereon.
SECTION 503. Collection of Indebtedness and Suits for Enforcement by
Trustee.
The Company covenants that if
(1) default is made in the payment of any interest on any
Security when such interest becomes due and payable and such default
continues for a period of 30 days, or
(2) default is made in the payment of the principal of (or
premium, if any, on) any Security at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of
the Holders of such Securities and coupons, the whole amount then due and
payable on such Securities and coupons for principal (and premium, if any) and
interest and, to the extent that payment of such interest shall be legally
enforceable, interest on any overdue principal (and premium, if any) and on
any overdue interest, at the rate borne by the Securities, and, in addition
thereto, such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
If the Company fails to pay such amounts forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust, may initiate
a judicial proceeding for the collection of the sums so due and unpaid, may
prosecute such proceeding to judgment or final decree and may enforce the same
against the Company or any other obligor upon the Securities and collect the
moneys adjudged or decreed to be payable in the manner provided by law out of
the property of the Company or any other obligor upon the Securities, wherever
situated.
If an Event of Default occurs and is continuing, the Trustee may in
its discretion proceed to protect and enforce its rights and the rights of the
Holders of Securities and coupons by such appropriate judicial proceedings as
the Trustee shall deem most effectual to protect and enforce any such rights,
whether for the specific enforcement of any covenant or agreement in this
Indenture or in aid of the exercise of any power granted herein, or to enforce
any other proper remedy.
SECTION 504. Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or 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 proceeding
or otherwise.
(i) to file and prove a claim for the whole amount of
principal (and premium, if any) and interest owing and unpaid in
respect of the Securities and to file such other papers or documents
as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and
counsel) and of the Holders of Securities and coupons allowed in such
judicial proceeding; and
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(ii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder of Securities and coupons to make such payments to the Trustee
and, in the event that the Trustee shall consent to the making of such
payments directly to the Holders of Securities and coupons, 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 606.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept, or adopt on behalf of any Holder of a
Security or coupon, any plan or reorganization, arrangement, adjustment or
composition affecting the Securities or the coupons or the rights of any
Holder thereof or to authorize the Trustee to vote in respect of the claim of
any Holder of a Security or coupon in any such proceeding.
Section 505. Trustee May Enforce Claims Without Possession of
Securities or Coupons.
All rights of action and claims under this Indenture or the
Securities or coupons may be prosecuted and enforced by the Trustee without
the possession of any of the Securities or coupons or the production thereof
in any proceeding relating thereto, and any such proceeding instituted by the
Trustee shall be brought in its own name as trustee of an express trust, and
any recovery of judgment shall, after provision for the payment of the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel, be for the ratable benefit of the Holder of the
Securities and coupons in respect of which such judgment has been recovered.
SECTION 506. Application of Money Collected.
Subject to Article Fourteen, any money collected by the Trustee
pursuant to this Article shall be applied in the following order, at the date
or dates fixed by the Trustee and, in case of the distribution of such money
on account of principal (or premium, if any) or interest, upon presentation
of the Securities or coupons, or both, as the case may be, 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 606;
SECOND: To the payment of the amounts then due and unpaid for
principal of (and premium, if any) and interest on the Securities and
coupons in respect of which or for the benefit of which such money
has been collected, ratably, without preference or priority of any
kind, according to the amounts due and payable on such Securities and
coupons for principal (and premium, if any) and interest,
respectively; and
THIRD: The balance, if any, to the Person or Persons entitled
thereto.
SECTION 507. Limitation on Suits.
No Holder of any Security or coupon 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;
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(2) the Holders of not less than 25% in principal amount of
the Outstanding Securities 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 (or such
lesser amount as shall have acted at a meeting pursuant to the
provisions of this Indenture, provided that such lesser amount is
more than the principal amount of the Outstanding Securities whose
Holders shall have made such written request);
it being understood and intended that no one or more of such Holders shall
have any right in any manner whatever by virtue of, or by availing of, any
provision of this Indenture to affect, disturb or prejudice the rights of any
other of such Holders, or to obtain or seek to obtain priority or preference
over any others of such Holders or to enforce any right under this Indenture,
except in the manner herein provided and for the equal and ratable benefit of
all of such Holders.
SECTION 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest and to Convert.
Notwithstanding any other provision in this Indenture, the Holder of
any Security or coupon shall have the right, which is absolute and
unconditional, to receive payment of the principal of (and premium, if any)
and (subject to Section 307) interest on such Security or payment of such
coupon on the respective Stated Maturities expressed in such Security or
coupon (or, in the case of redemption at the option of the Company or the
Holder, on the Redemption Date) and to convert such Security in accordance
with Article Thirteen, and to institute suit for the enforcement of any such
payment and right to convert, and such rights shall not be impaired without
the consent of such Holder.
SECTION 509. Restoration of Rights and Remedies.
If the Trustee or any Holder of a Security or coupon has instituted
any proceeding to enforce any right or remedy under this Indenture and such
proceeding has been discontinued or abandoned for any reason, or has been
determined adversely to the Trustee or to such Holder, then and in every such
case, subject to any determination in such proceeding, the Company, the
Trustee and the Holder of Securities and coupons shall be rendered severally
and respectively to their former positions hereunder, and thereafter all
rights and remedies of the Trustee and the Holders shall continue as though no
such proceeding had been instituted.
SECTION 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities or coupons in the
last paragraph of Section 306, no right or remedy herein conferred upon or
reserved to the Trustee or to the Holders of Securities or coupons 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
40
assertion or employment of any right or remedy hereunder, otherwise, shall not
prevent the concurrent assertion or employment of any other appropriate right
or remedy.
SECTION 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of a Security or
coupon 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 as acquiescence therein. Every right and remedy given by this
Article or by law to the Trustee or to the Holders of Securities or coupons
may be exercised from time to time, and as often as may be deemed expedient,
by the Trustee or by the Holders of Securities or coupons, as the case may be.
SECTION 512. Control by Holders of Securities.
The Holders of a majority in principal amount of the Outstanding
Securities (or such lesser amount as shall have acted at a meeting pursuant to
the provisions of this Indenture) shall have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee or exercising any trust or power conferred on the Trustee, provided
that
(1) such direction shall not be in conflict with any rule of
law or with this Indenture, including, but not limited to Sections
507 and 602(e) hereof, and
(2) the Trustee may take any other action deemed proper by
the Trustee which is not inconsistent with such direction.
SECTION 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Securities (or such lesser amount as shall have acted at a meeting
pursuant to the provisions of this Indenture) may on behalf of the Holder of
all the Securities and coupons waive any past default hereunder and its
consequences, except a default
(1) in the payment of the principal of (or premium, if any)
or interest on any Security, or
(2) in respect of a covenant or provision hereof which under
Article Eight cannot be modified or amended without the consent of
the Holder of each Outstanding Security affected.
Upon any such waiver, such default shall cease to exist, and any
Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other default or impair any right consequent thereon.
SECTION 514. Undertaking for Costs.
All parties to this Indenture agree, and each Holder of any Security
or coupon by his acceptance thereof shall be deemed to have agreed, that any
court may in its discretion require, in any suit for the enforcement of any
right or remedy under this Indenture, or in any suit against the Trustee for
any action taken, suffered or omitted by it as Trustee, the filing by any
party litigant in such suit of an undertaking to pay the costs of such suit,
and that such court may in its discretion assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in such suit, having
due regard to the merits and good faith of the claims or defenses made by such
party litigant; but the provisions of this Section shall not apply to any
suit instituted by the Company, to any suit instituted by the Trustee, to any
suit instituted by any Holder, or group of Holders, holding in the aggregate
more than 10% in principal amount of
41
the Outstanding Securities, or to any suit instituted by any Holder of any
Security or coupon for the enforcement of the payment of the principal of (or
premium, if any) or interest on any Security or the payment of any coupon on
or after the respective Stated Maturities expressed in such Security or coupon
(or, in the case of redemption at the option of the Company or the Holder, on
or after the Redemption Date) or for the enforcement of the right to convert
any Security in accordance with Article Thirteen.
SECTION 515. Waiver of Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay or extension law wherever
enacted, now or at any time hereafter 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 SIX
THE TRUSTEE
SECTION 601. Certain Duties and Responsibilities.
(a) Except during the continuance of an Event of Default,
(1) the Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture, and no
implied covenants or obligations shall be read into this Indenture
against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements
of this Indenture; but in the case of any such certificates or
opinions which by any provision hereof are specifically required to
be furnished to the Trustee, the Trustee shall be under a duty to
examine the same to determine whether or not they conform to the
requirements of this Indenture.
(b) In case an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their exercise, as a
prudent man would exercise or use under the circumstances in the conduct of
his own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, it own negligent failure
to act, or its own wilful misconduct, except that
(1) this Subsection shall not be construed to limit the
effect of Subsection (a) of this Section;
(2) the Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless it shall
be proved that the Trustee was negligent in ascertaining the
pertinent facts;
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(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 (or such lesser amount as shall have
acted at a meeting pursuant to the provisions of this Indenture)
relating to the time, method and place of conducting any proceeding
for any remedy available to the Trustee, or exercising any trust or
power conferred upon the Trustee, under this Indenture; and
(4) no provision of this Indenture shall require the Trustee
to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder, or in
the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably
assured to it.
(d) Whether or not therein expressly so provided, every provision of
this Indenture relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of this
Section.
SECTION 602. Certain Rights of Trustee.
Subject to the provisions of Section 601:
(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, note, coupon, other evidence of indebtedness
or other paper or document believed by it to be genuine and to have
been signed or presented by the proper party or parties;
(b) any request or direction of the Company mentioned herein
shall be sufficiently evidenced by a Company Request or Company Order
and any resolution of the Board of Directors may be sufficiently
evidenced by a Board Resolution;
(c) whenever in the administration of this Indenture the
Trustee shall deem it desirable that a matter be proved or
established prior to taking, suffering or omitting any action
hereunder, the Trustee (unless other evidence be herein specifically
prescribed) may, in the absence of bad faith on its part, rely upon
an Officers' Certificate;
(d) the Trustee may consult with counsel and the written
advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in reliance
thereon;
(e) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request
or direction of any of the Holders of Securities or coupons pursuant
to this Indenture, unless such Holders shall have offered to the
Trustee reasonable security or indemnity against the costs, expenses
and liabilities which might be incurred by it in compliance with such
request or direction;
(f) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, coupon, other evidence of
indebtedness or other paper or document, but the Trustee, in its
discretion, may make such further inquiry or investigation into such
facts or matters as it may see fit, and, if the Trustee shall
determine to make such further inquiry or investigation, it shall be
entitled to examine the books, records and premises of the Company,
personally or by agent or attorney; and
43
(g) the Trustee may execute any of the trusts or powers
hereunder or perform 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.
SECTION 603. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities (except the
Trustee's certificates of authentication) and in the coupons shall be taken at
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 or coupons. The Trustee
shall not be accountable for the use or application by the Company of
Securities or the proceeds thereof.
SECTION 604. May Hold Securities, Act as Trustee Under Other
Indentures.
The Trustee, any Paying Agent, any Transfer Agent, any Conversion
Agent, any Security Registrar or any other agent of the Company, in its
individual or any other capacity, may become the owner pledgee of Securities
and coupons and may otherwise deal with the Company with the same rights it
would have if it were not Trustee, Paying Agent, Transfer Agent, Conversion
Agent, Security Registrar or such other agent.
The Trustee may become and act as trustee under other indentures
under which other securities, or certificates of interest or participation in
other securities, of the Company are outstanding in the same manner as if it
were not Trustee.
SECTION 605. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on money received by it hereunder except as
otherwise agreed with the Company.
SECTION 606. 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, 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.
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As security for the performance of the obligations of the Company
under this Section, the Trustee shall have a claim prior to the Securities
upon all property and funds held or collected by the Trustee as such, except
funds held in trust (whether or not segregated) for the payment of principal
of (and premium, if any) or interest on Securities.
SECTION 607. Corporate Trustee Required: Eligibility.
There shall at all times be a Trustee hereunder which shall be a
corporation organized and doing business under the laws of the United States
of America, any State thereof or the District of Columbia, authorized under
such laws to exercise corporate trust powers, having a combined capital and
surplus of at least U.S.$50,000,000, subject to supervision or examination by
Federal or State authority and having its Corporate Trust Office in the
Borough of Manhattan, The City of New York. If such corporation publishes
reports of condition at least annually, pursuant to law or to the requirements
of said supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such corporation shall be deemed
to be its combined capital and surplus as set forth in its most recent report
of condition so published. If at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article.
SECTION 608. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 609.
(b) The Trustee may resign at any time by giving written notice
thereof to the Company. If the instrument of acceptance by a successor Trustee
required by Section 609 shall not have been delivered to the Trustee within 30
days after the giving of such notice of resignation, the resigning Trustee may
petition any court of competent jurisdiction for the appointment of a
successor Trustee.
(c) The Trustee may be removed at any time by Act of the Holders of a
majority in principal amount of the Outstanding Securities (or such lesser
amount as shall have acted at a meeting pursuant to the provisions of this
Indenture), delivered to the Trustee and the Company.
(d) If at any time:
(1) the trustee shall cease to be eligible under Section 607
and shall fail to resign after written request therefor by the
Company or by any Holder of a Security who has been a bona fide
Holder of a Security for at least six months, or
(2) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of
its property shall be appointed or any public officer shall take
charge or control of the Trustee or of its property or affairs for
the purpose of rehabilitation, conservation or liquidation,
then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee, or (ii) subject to Section 514, any Holder of a Security who has been
a bona fide Holder of a Security 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.
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(e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause,
the Company, by a Board Resolution, shall promptly appoint a successor Trustee
and shall comply with the applicable requirements of Section 609. If, within
one year after such resignation, removal or incapability, or the occurrence of
such vacancy, a successor Trustee shall be appointed by Act of the Holders of
a majority in principal amount of the Outstanding Securities (or such lesser
amount as shall have acted at a meeting pursuant to the provisions of this
Indenture) delivered to the Company and the retiring Trustee, the successor
Trustee so appointed shall, forthwith upon its acceptance of such appointment
in accordance with the applicable requirements of Section 609, become the
successor Trustee and supersede the successor Trustee appointed by the
Company. If no successor Trustee shall have been so appointed by the Company
or the Holders of Securities and accepted appointment in the manner required
by Section 609, any Holder of a Security who has been a bona fide Holder of a
Security for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Trustee.
(f) The Company shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor Trustee to the
Holders of Securities in the manner provided in Section 105. Each notice shall
include the name of the successor Trustee and the address of its Corporate
Trust Office.
SECTION 609. Acceptance of Appointment by Successor.
Every successor Trustee appointed hereunder shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an
instrument accepting such appointment, and thereupon the resignation or
removal of the retiring Trustee shall become effective and such successor
Trustee, without any further act, deed or conveyance, shall become vested with
all the rights, powers, trusts and duties of the retiring Trustee; but, on
request of the Company or the successor Trustee, such retiring Trustee shall,
upon payment of its charges, execute and deliver an instrument transferring to
such successor Trustee all the rights, powers and trusts of the retiring
Trustee and shall duly assign, transfer and deliver to such successor Trustee
all property and money held by such retiring Trustee hereunder. Upon request
of any such successor Trustee, the Company shall execute any and all
instruments for more fully and certainly vesting in and confirming to such
successor Trustee all such rights, powers and trusts.
No successor Trustee shall accept its appointment unless at the time
of such acceptance such successor Trustee shall be eligible under this
Article.
SECTION 610. Merger, Conversion, Consolidation or Succession to
Business.
Any corporation into which the Trustee may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party,
or any corporation succeeding to all or substantially all the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise 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.
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ARTICLE SEVEN
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 701. Company May Consolidate, Etc. Only on Certain Terms.
The Company shall not consolidate with or merge into any other Person
or convey, transfer or lease its properties and assets substantially as an
entirety to any Person, unless:
(1) the Person formed by such consolidation or into which
the Company is merged or the Person which acquires by conveyance or
transfer, or which leases, the properties and assets of the Company
substantially as an entirety shall be a corporation, organized and
validly existing under the laws of the United States of America, any
State thereof or the District of Columbia and shall expressly assume,
by an indenture supplemental hereto, executed and delivered to the
Trustee, in form satisfactory to the Trustee, the due and punctual
payment of the principal of (and premium, if any) and interest
(including all additional amounts payable pursuant to Section 1004),
on all the Securities and the performance of every covenant of this
Indenture on the part of the Company to be performed or observed and
shall have provided for conversion rights in accordance with Section
1311;
(2) immediately after giving effect to such transaction, 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 shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that
such consolidation, merger, conveyance, transfer or lease and, if a
supplemental indenture is required in connection with such
transaction, such supplemental indenture comply with this Article and
that all conditions precedent herein provided for relating to such
transaction have been complied with.
SECTION 702. Successor Substituted.
Upon any consolidation of the Company with, or merger of the Company
into, any other Person or any conveyance, transfer or lease of the properties
and assets of the Company substantially as an entirety in accordance with
Section 701, the successor corporation formed by such consolidation or into
which the Company is merged or to which such conveyance, transfer or lease is
made shall succeed to, and be substituted for, and may exercise every right
and power of, the Company under this Indenture with the same effect as if such
successor corporation had been named as the Company herein, and thereafter,
except in the case of a lease, the predecessor corporation had been named as
the Company herein, and thereafter, except in the case of a lease, the
predecessor corporation shall be relieved of all obligations and covenants
under this Indenture and the Securities and coupons.
ARTICLE EIGHT
SUPPLEMENTAL INDENTURES
SECTION 801. Supplemental Indentures With Consent of Holders.
Without the consent of any Holders of Securities or coupons, the
Company, when authorized by a Board Resolution, and the Trustee at any time
and from time to time, may enter
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into one or more indentures supplemental hereto, in form satisfactory to the
Trustee, or for any of the following purposes:
(1) to evidence the succession of another corporation to the
Company and the assumption by any such successor of the covenants of
the Company herein in the Securities and in the coupons; or
(2) to add to the covenants of the Company for the benefit
of the Holders of Securities or coupons, or to surrender any right or
power herein conferred upon the Company; or
(3) to secure the Securities pursuant to the requirements of
Section 1008 or otherwise; or
(4) to permit Registered Securities to be exchanged for
Bearer Securities or to relax or eliminate the restrictions on
payment of principal of (and premium, if any) or interest on Bearer
Securities in the United States; or
(5) to make provision with respect to the conversion rights
of Holders of Securities pursuant to Section 1311; or
(6) 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, provided such action pursuant
to this clause (6) shall not adversely affect the interests of the
Holders of Securities or coupons in any material respect.
SECTION 802. Supplemental Indenture with Consent of Holders of
Securities.
With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities (or such lesser amount as shall
have acted at a meeting pursuant to the provisions of this Indenture), by Act
of said Holders delivered to the Company and the Trustee, the Company, when
authorized by a Board Resolution, and the Trustee may enter into an indenture
or indentures supplemental hereto for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions of this
Indenture or of modifying in any manner the rights of the Holders of the
Securities or coupons under this Indenture; provided, however, that no such
supplemental indenture shall, without the consent of the Holder of each
Outstanding Security or coupon affected thereby.
(1) change the Stated Maturity of the principal of, or any
instalment of interest on, any Security, or reduce the principal
amount thereof or the rate of interest thereon or any premium payable
upon the redemption thereof, or change the obligation of the Company
to pay additional amounts pursuant to Section 1004 (except as
contemplated by Section 701(l) and permitted by Section 801(l)), or
change the coin or currency in which any Security or any premium or
the interest thereon is payable, or impair the right to institute
suit for the enforcement of any such payment on or after the Stated
Maturity thereof (or, in the case of redemption at the option of the
Company or the Holders, on or after the Redemption Date), or
adversely affect the right to convert any Securities as provided in
Article Thirteen or modify the provisions of this Indenture with
respect to the subordination of the Securities in a manner adverse to
the Holders, or
(2) reduce the requirements of Section 904 for quorum or
voting, or reduce the percentage in principal amount of the
Outstanding Securities the consent of whose Holders
48
is required for any 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) change the obligation of the Company to maintain an
office or agency in the Borough of Manhattan, The City of New York,
and in a European city pursuant to Section 1002, or
(4) modify any of the provisions of this Section, Section
513 or Section 1011, 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.
It shall not be necessary for any Act of Holders of Securities 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 803. Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modification thereby
of the trusts created by this Indenture, the Trustee shall be entitled to
receive, and (subject to Section 601) shall be fully protected in relying
upon, an Opinion of Counsel stating that the execution of such supplemental
indenture is authorized or permitted by this Indenture. The Trustee may, but
shall not be obligated to, enter into any such supplemental indenture which
affects the Trustee's own rights, duties or immunities under this Indenture or
otherwise.
SECTION 804. Effect of Supplemental Indenture.
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 and of any coupons appertaining thereto shall be bound
thereby.
SECTION 805. 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
Company and the Trustee, 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.
SECTION 806. Notice of Supplemental Indentures.
Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of Section 802, the Company
shall give notice, setting forth in general terms the substance of such
supplemental indenture, in the manner provided in Section 106. Any failure of
the Company to give such notice, or any defect therein, shall not in any way
impair or affect the validity of any such supplemental indenture.
49
ARTICLE NINE
MEETINGS OF HOLDERS OF SECURITIES
SECTION 901. Purposes for Which Meetings May Be Called.
A meeting of Holders of Securities may be called at any time and from
time to time pursuant to this Article to make, give or take any request,
demand, authorization, direction, notice, consent, election, waiver or other
action provided by this Indenture to be made, given or taken by Holders of
Securities.
SECTION 902. Call, Notice and Place of Meetings.
(a) The Trustee may at any time call a meeting of Holders of
Securities for any purpose specified in Section 901, to be held at such time
and at such place in the Borough of Manhattan, The City of New York, or in
London as the Trustee shall determine. Notice of every meeting of Holders of
Securities, setting forth the time and the place of such meeting and in
general terms the action proposed to be taken at such meeting, shall be given,
in the manner provided in Section 105, not less than 21 nor more than 180 days
prior to the date fixed for the meeting.
(b) In case at any time the Company, pursuant to a Board Resolution,
or the Holders of at least 10% in principal amount of the Outstanding
Securities shall have requested the Trustee to call a meeting of the Holders
of Securities for any purpose specified in Section 901, by written request
setting forth in reasonable detail the action proposed to be taken at the
meeting, and the Trustee shall not have made the first publication of the
notice of such meeting within 21 days after receipt of such request or shall
not thereafter proceed to cause the meeting to be held as provided herein, then
the Company or the Holders of Securities in the amount above specified, as the
case may be, may determine the time and the place in the Borough of Manhattan,
The City of New York, or in London for such meeting and may call such meeting
for such purposes by giving notice thereof as provided in subsection (a) of
this Section.
SECTION 903. Persons Entitled to Vote at Meetings.
To be entitled to vote at any meeting of Holders of Securities, a
Person shall be (1) a Holder of one or more Outstanding Securities, or (2) a
Person appointed by an instrument in writing as proxy for a Holder or Holders
of one or more Outstanding Securities by such Holder or Holders. The only
Persons who shall be entitled to be present or to speak at any meeting of
Holders shall be the Persons entitled to vote at such meeting and their
counsel, any representatives of the Trustee and its counsel and any
representatives of the Company and its counsel.
SECTION 904. Quorum; Action.
The Persons entitled to vote a majority in principal amount of the
Outstanding Securities shall constitute a quorum. In the absence of a quorum
within 30 minutes of the time appointed for any such meeting, the meeting
shall, if convened at the request of Holders of Securities, be dissolved. In
any other case the meeting may be adjourned for a period of not less than 10
days as determined by the chairman of the meeting prior to the adjournment of
such meeting. In the absence of a quorum at any such adjourned meeting, such
adjourned meeting may be further adjourned for a period of not less than 10
days as determined by the chairman of the meeting prior to the adjournment of
such adjourned meeting. Notice of the reconvening of any adjourned meeting
shall be given as provided in Section 902(a), except that such notice need be
given only
50
once not less than five days prior to the date on which the meeting is
scheduled to be reconvened. Notice of the reconvening of an adjourned meeting
shall state expressly the percentage of the principal amount of the
Outstanding Securities which shall constitute a quorum.
Subject to the foregoing, at the reconvening of any meeting adjourned
for a lack of a quorum the Persons entitled to vote 25% in principal amount of
the Outstanding Securities at the time shall constitute a quorum for the
taking of any action set forth in the notice of the original meeting.
At a meeting or an adjourned meeting duly reconvened and at which a
quorum is present as aforesaid, any resolution and all matters (except as
limited by the proviso to Section 802) shall be effectively passed and decided
if passed or decided by the Persons entitled to vote 66 2/3% in principal
amount of Outstanding Securities represented and voting at such meeting.
Any resolution passed or decision taken at any meeting of Holders of
Securities duly held in accordance with this Section shall be binding on all
the Holders of Securities and coupons, whether or not present or represented
at the meeting.
SECTION 905. Determination of Voting Rights; Conduct and Adjournment
of Meetings.
(a) Notwithstanding any other provisions of this Indenture, the
Trustee may make such reasonable regulations as it may deem advisable for any
meeting of Holders of Securities in regard to proof of the holding of
Securities and of the appointment of proxies and in regard to the appointment
and duties of inspectors of votes, the submission and examination of proxies,
certificates and other evidence of the right to vote, and such other matters
concerning the conduct of the meeting as it shall deem appropriate. Except as
otherwise permitted or required by any such regulations, the holding of
Securities shall be proved in the manner specified 103 and the appointment of
any proxy shall be proved in the manner specified in Section 103 or by having
the signature of the person executing the proxy witnessed or guaranteed by any
trust company, bank or banker authorized by Section 103 to certify to the
holding of Bearer Securities. Such regulations may provide that written
instruments appointing proxies, regular on their face, may be presumed valid
and genuine without the proof specified in Section 103 or other proof.
(b) The Trustee shall, by an instrument in writing, appoint a
temporary chairman of the meeting, unless the meeting shall have been called
by the Company or by Holders of Securities as provided in Section 902(b), in
which case the Company or the Holders of Securities calling the meeting, as the
case may be, shall in like manner appoint a temporary chairman. A permanent
chairman and a permanent secretary of the meeting shall be elected by vote of
the Persons entitled to vote a majority in principal amount of the Outstanding
Securities represented at the meeting.
(c) At any meeting each Holder of a Security or proxy shall be
entitled to one vote for each U.S.$5,000 principal amount of Securities held
or represented by him; provided, however, that no vote shall be cast or
counted at any meeting in respect of any Security challenged as not
Outstanding and ruled by the chairman of the meeting to be not Outstanding.
The chairman of the meeting shall have no right to vote, except as a Holder of
a Security or proxy.
(d) Any meeting of Holders of Securities duly called pursuant to
Section 902 at which a quorum is present may be adjourned from time to time by
Persons entitled to vote a majority in
51
principal amount of the Outstanding Securities represented at the meeting, and
the meeting may be held as so adjourned without further notice.
SECTION 906. Counting Votes and Recording Action of Meetings.
The vote upon any resolution submitted to any meeting of Holders of
Securities shall be by written ballots on which shall be subscribed the
signatures of the Holders of Securities or of their representatives by proxy
and the principal amounts and serial numbers of the Outstanding Securities
held or represented by them. The permanent chairman of the meeting shall
appoint two inspectors of votes who shall count all votes cast at the meeting
for or against any resolution and who shall make and file with the secretary
of the meeting their verified written reports in duplicate of all votes cast
at the meeting. A record, at least in duplicate, of the proceedings of each
meeting of Holders of Securities shall be prepared by the secretary of the
meetings and there shall be attached to said record the original reports of
the inspectors of votes on any vote by ballot taken thereat and affidavits by
one or more persons having knowledge of the facts setting forth a copy of the
notice of the meeting and showing that said notice was given as provided in
Section 902 and, if applicable, Section 904. Each copy shall be signed and
verified by the affidavits of the permanent chairman and secretary of the
meeting and one such copy shall be delivered to the Company and another to the
Trustee to be preserved by the Trustee, the latter to have attached thereto
the ballots voted at the meeting. Any record so signed and verified shall be
conclusive evidence of the matters therein stated.
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium and Interest.
The Company will duly and punctually pay the principal of (and
premium, if any) and interest on the Securities in accordance with the terms
of the Securities, the coupons appertaining thereto and this Indenture. The
interest due on the Bearer Securities on or before Maturity, other than
additional amounts payable as provided in Section 1004 in respect of principal
of (or premium, if any, on) such a Security, shall be payable only upon
presentation and surrender of the several coupons for such interest
instalments as are evidenced thereby as they severally mature.
SECTION 1002. Maintenance of Offices or Agencies.
The Company hereby appoints (1) the Corporate Trust Office of the
Trustee as its agent in the Borough of Manhattan, The City of New York, where
Registered Securities may be presented or surrendered for payment, where
Bearer Securities and coupons may be presented or surrendered for payment in
the circumstances described below (and not otherwise), where Securities may be
surrendered for registration of transfer or exchange, where Securities may be
surrendered for conversion and where notices and demands to or upon the
Company in respect of the Securities and coupons and this Indenture may be
served and (2) the main office of the Trustee in London as its agent outside
of the United States where, subject to any applicable laws or regulations,
Bearer Securities and coupons may be presented and surrendered for payment.
As provided in the forms of Security set forth in Section 202, payment of
principal of and premium, if any, and interest on Bearer Securities and
payment of any additional amounts payable on Bearer Securities pursuant to
Section 1004 may be made at the Paying Agent in the
▇▇
▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇, The City of New York, if (but only if) payment of the
full amount of such principal, premium, interest or additional amounts, as the
case may be, at offices outside the United States maintained for the purpose
by the Company in accordance with this Indenture is illegal or effectively
precluded by exchange controls or other similar restrictions.
In addition, the Company hereby appoints (1) the main offices of
Manufacturers Hanover Bank/Belgium S.A. in Brussels, Manufacturers Hanover
Bank Luxembourg S.A. in Luxembourg and Manufacturers Hanover Trust Company in
Frankfurt/Main, London and Zurich as additional Paying Agents for the payment
of principal of (and premium, if any) and interest on the Securities, (2) the
main offices of Manufacturers Hanover Bank/Belgium S.A. in Brussels,
Manufacturers Hanover Bank Luxembourg S.A. in Luxembourg and Manufacturers
Hanover Trust Company in Frankfurt/Main and London as additional Conversion
Agents for the conversion of the Securities in accordance with Article
Thirteen, and (3) the main offices of Manufacturers Hanover Bank/Belgium S.A.
in Brussels and Manufacturers Hanover Bank Luxembourg S.A. in Luxembourg as
additional Transfer Agents where Securities may be surrendered for registration
of transfer or exchange.
The Company may at any time and from time to time vary or terminate
the appointment of any such agent or appoint any additional agents for any or
all of such purposes; provided, however, that until the Securities have been
delivered to the Trustee for cancellation, or moneys sufficient to pay the
principal of and premium, if any, and interest on the Securities have been made
available for payment and either paid or returned to the Company pursuant to
the provisions of Section 1003, the Company will maintain (1) in the Borough
of Manhattan, The City of New York, an office or agency where Registered
Securities may be presented or surrendered for payment, where Bearer
Securities and coupons may be presented or surrendered for payment in the
circumstances described in the last sentence of the first paragraph of this
Section (and not otherwise), where Securities may be surrendered for
registration of transfer or exchange, where Securities may be surrendered for
conversion and where notices and demands to or upon the Company in respect of
the Securities and coupons and this Indenture may be served and (3) subject to
any laws or regulations applicable thereto, in a European city an office or
agency where Bearer Securities and coupons may be presented or surrendered for
payment and where Securities may be presented for registration of transfer or
exchange and surrendered for conversion; and provided, further, that so long as
the Securities are listed on the Luxembourg Stock Exchange and such stock
exchange shall so require, the Company will maintain a Paying Agent and
Conversion Agent in Luxembourg. The Company will give prompt written notice to
the Trustee and the Holders of the appointment or termination of any such
agent and of the location and any change in the location of any such office or
agency.
If at any time the Company shall fail to maintain any such required
office or agency in the Borough of Manhattan, The City of New York, or in a
European city, or shall fail to furnish the Trustee with the address thereof,
presentations and surrenders may be made (subject to the limitations described
in the preceding paragraph) at and notices and demands may be served on and
Securities may be surrendered for conversion to the Corporate Trust Office of
the Trustee, and Securities and coupons may be presented and surrendered for
payment to the Trustee at its main office in London, and the Company hereby
appoints the same as its agent to receive such presentations, surrenders,
notices and demands.
53
SECTION 1003. Money For Security Payments to Be Held in Trust.
If the Company shall act as a Paying Agent, it will, on or before
each due date of the principal of (and premium, if any) or interest on any of
the Securities, 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 the Company will promptly notify
the Trustee of its action or failure so to act.
Whenever the Company shall have one or more Paying Agents, it will,
prior to each due date of the principal of (and premium, if any) or interest on
any Securities, 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,
premiums or interest, and (unless such Paying Agent is the Trustee) the Company
will promptly notify the Trustee of its action or failure so to act.
The Company will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent will:
(1) hold all sums held by it for the payment of the
principal of (and premium, if any) or interest on Securities in trust
for the benefit of the Persons entitled thereto until such sums shall
be paid to such Persons or otherwise disposed of as herein provided;
(2) give the Trustee notice of any default by the Company
(or any other obligor upon the Securities) in the making of any
payment of principal (and premium, if any) or interest; and
(3) at any time during the continuance of any such default,
upon the written request of the Trustee, forthwith pay to the Trustee
all sums so held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held
in trust by the Company or such Paying Agent, such sums to be held by the
Trustee upon the same trusts as those upon which such sums were held 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 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 or any coupon appertaining thereto 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
cause; provided, however, that the Trustee or such Paying Agent, before being
required to make any such repayment, may at the expense of the Company cause
notice to be given as provided in Section 105, except that such notice need be
given only once, that such money remains unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the latest date
of such notice, any unclaimed balance of such money then remaining will be
repaid to the Company.
54
SECTION 1004. Additional Amounts.
The Company will pay to the Holder of any Security or any coupon
appertaining thereto additional amounts as provided in the second paragraph on
the face of the forms of Securities set forth in Section 202 and any
additional amounts which may become payable as provided in the third paragraph
on the face of the forms of Securities set forth in Section 202. Whenever in
this Indenture there is mentioned, in any context, the payment of the
principal of (or premium, if any) or interest on, or in respect of, any
Security or any coupon, such mention shall be deemed to include mention of the
payment of additional amounts provided for in this Section to the extent that,
in such context, additional amounts are, were or would be payable in respect
thereof pursuant to the provisions of this Section and express mention of the
payment of additional amounts (if applicable) in any provisions hereof shall
not be construed as excluding additional amounts in those provisions hereof
where such express mention is not made.
At least 10 days prior to February 20, 1987 (and at least 10 days
prior to each date of payment of principal (and premium, if any) or
interest after February 20, 1987 if there has been any change with respect to
the matters set forth in the below-mentioned Officers' Certificate) the
Company will furnish the Trustee and the Company's Paying Agent in the Borough
of Manhattan, The City of New York, if other than the Trustee, with an
Officers' Certificate instructing the Trustee and such Paying Agent whether
such payment of principal of (and premium, if any) or interest on the
Securities shall be made to Holders of Securities or coupons who are United
States Aliens without withholding for or on account of any tax, assessment or
other governmental charge described in the second paragraph on the face of the
forms of Securities set forth in Section 202. If any such withholding shall be
required, then such Officers' Certificate shall specify by country the amount,
if any, required to be withheld on such payments to such Holders of Securities
or coupons and the Company will pay to the Trustee or such Paying Agent the
additional amounts required by this Section to be paid in the event of any
such withholding. The Company covenants to indemnify the Trustee and any
Paying Agent for, and to hold them harmless against, any loss, liability or
expense reasonably incurred without negligence or bad faith on their part
arising out of or in connection with actions taken or omitted by any of them
in reliance on any Officers' Certificate furnished pursuant to this Section.
SECTION 1005. Corporate Existence.
Subject to Article Seven, the Company will do or cause to be done
all things necessary to preserve and keep in full force and effect its
corporate existence, rights (charter and statutory) and franchises; provided,
however, that the Company shall not be required to preserve any such right or
franchise if the Board of Directors shall determine that the preservation
thereof is no longer desirable in the conduct of the business of the Company
and that the loss thereof is not disadvantageous in any material respect to
the Holders.
SECTION 1006. Maintenance of Properties.
The Company will cause all properties used or useful in the conduct
of its business or the business of any Subsidiary to be maintained and kept in
good condition, repair and working order and supplied with all necessary
equipment and will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of
the Company may be necessary so that the business carried on in connection
therewith may be properly and advantageously conducted at all times; provided,
however, that nothing in this Section shall prevent the Company from
discontinuing the operation or maintenance of any of
55
such properties if such discontinuance is, in the judgment of the Company,
desirable in the conduct of its business or the business of any Subsidiary and
not disadvantageous in any material respect to the Holders.
SECTION 1007. Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid or discharged
before the same shall become delinquent, (1) all taxes, assessments and
governmental charges levied or imposed upon the Company or any Subsidiary or
upon the income, profits or property of the Company or any Subsidiary, and (2)
all lawful claims for labor, materials and supplies which, if unpaid, might by
law become a lien upon the property of the Company or any Subsidiary;
provided, however, that the Company shall not be required to pay or discharge
or cause to be paid or discharged any such tax, assessment, charge or claim
whose amount, applicability or validity is being contested in good faith by
appropriate proceedings.
SECTION 1008. Limitation on Debt Secured by Stock of California
Federal.
The Company will not agree to secure any indebtedness for borrowed
money (or any guarantee or indemnity in respect thereof) by any mortgage,
lien, pledge or other security interest upon, or with respect to, any of the
capital stock of California Federal, unless the Company shall, simultaneously
therewith or prior thereto, take any and all action necessary effectively to
secure the Securities equally and ratably with (or prior to), or by security
not materially less beneficial than that securing, such other indebtedness,
guarantee or indemnity.
SECTION 1009. Limitation on Disposition of Stock of California
Federal.
Except in a transaction under Section 701, the Company (which term
shall include any successor by merger, assumption or otherwise) will own
directly or indirectly more than 80% of the outstanding shares of capital
stock having voting power for the election of directors (except for directors'
qualifying shares) of California Federal.
SECTION 1010. Statement by Officers as to Default.
The Company will deliver to the Trustee, within 120 days after the
end of each fiscal year (which on the date hereof end on December 31) of the
Company ending after the date hereof, an Officers' Certificate, stating
whether or not to the best knowledge of the signers thereof the Company is in
default in the performance and observance of any of the terms, provisions and
conditions of this Indenture, and if the Company shall be in default,
specifying all such defaults and the nature and status thereof of which they
may have knowledge.
SECTION 1011. Waiver of Certain Covenants.
The Company may omit in any particular instance to comply with any
term, provision or condition set forth in Sections 1006 to 1009, inclusive, if
before the time for such compliance the Holders of at least a majority in
principal amount of the Outstanding Securities (or such lesser amount as
shall have acted at a meeting pursuant to the provisions of this Indenture)
shall, by Act of such Holders, either waive such compliance in such instance
or generally waive compliance with such term, provision or condition, but no
such waiver shall extend to or affect such term, provision 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 term, provision or condition shall remain in full force
and effect.
56
ARTICLE ELEVEN
REDEMPTION OF SECURITIES AT OPTION OF COMPANY
SECTION 1101. Right of Redemption.
The Securities may be redeemed subject to the conditions, at the times
and at the Redemption Prices specified in the forms of Securities set forth in
Section 202, together with accrued interest to the Redemption Date; provided,
however, that until the expiration of the thirtieth day after the Exchange
Date, the Company may not redeem the Securities other than under the
circumstances described in the third paragraph on the reverse side of such
forms (involving United States taxes) or in the fourth paragraph on the reverse
side of such forms (involving certification requirements).
SECTION 1102. Applicability of Article.
Redemption of Securities at the election of the Company, as permitted
or required by any provision of the Securities or this Indenture, shall be
made in accordance with such provision and this Article.
SECTION 1103. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be
evidenced by a Board Resolution. In case of any redemption at the election of
the Company of all of the Securities, the Company shall, at least 60 days
prior to the Redemption Date fixed by the Company (unless a shorter notice
shall be satisfactory to the Trustee), notify the Trustee of such Redemption
Date. In case of any redemption at the election of the Company of less than all
the Securities, the Company shall, at least 75 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 to be redeemed. If the Securities are to be redeemed
pursuant to an election of the Company which is subject to a condition
specified in the forms of Securities set forth in Section 202, the Company
shall furnish the Trustee with an Officers' Certificate stating that the
Company is entitled to effect such redemption and setting forth a statement of
facts demonstrating the same.
SECTION 1104. Selection by Trustee of Securities to Be Redeemed.
If less than all the Securities are to be redeemed, the particular
Securities to be redeemed shall be selected not more than 60 days prior to the
Redemption Date by the Trustee, from the Outstanding Securities not previously
called for redemption, by such method as the Trustee shall deem fair and
equitable and which may provide for the selection for redemption of portions
(equal to U.S.$5,000 or any integral multiple thereof) of the principal amount
of Registered Securities of a denomination larger than U.S.$5,000. Partial
redemptions must be in an amount not less than U.S.$1,000,000 principal amount
of Securities.
If any Registered Security selected for partial redemption is
converted in part before 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. Securities which have been converted during a selection of
Securities to be redeemed may be treated by the Trustee as Outstanding for the
purpose of such selection.
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The Trustee shall promptly notify the Company and each Security
Registrar in writing of the Securities selected for redemption and, in the
case of any Registered Securities selected for partial redemption, the
principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise
requires all provisions relating to the redemption of Securities shall
relate, in the case of any Securities redeemed or to be redeemed only in part,
to the portion of the principal amount of such Securities which has been or is
to be redeemed.
SECTION 1105. Notice of Redemption.
Notice of redemption shall be given in the manner provided in Section
105 to the Holders of Securities to be redeemed. If all of the Outstanding
Securities are to be redeemed, notice shall be given not less than 30 nor more
than 60 days prior to the Redemption Date. If less than all the Outstanding
Securities are to be redeemed, notice shall be given twice, the first such
notice to be given not more than 75 nor less than 60 days prior to the
Redemption Date and the second notice to be given at least 20 days after the
first such notice but not less than 30 days prior to the Redemption Date.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the Outstanding Securities are to be redeemed,
the aggregate principal amount of Securities to be redeemed and the aggregate
principal amount of Securities which will be Outstanding after such partial
redemption,
(4) that on the Redemption Date the Redemption Price will become due
and payable upon each such Security to be redeemed, and that interest thereon
shall cease to accrue on and after said date,
(5) the Conversion Price, the date on which the right to convert the
principal of the Securities to be redeemed will terminate and the place or
places where such Securities may be surrendered for conversion, and
(6) the place or places where such Securities, together in the case
of Bearer Securities with all coupons appertaining thereto, if any, maturing
after the Redemption Date, are to be surrendered for payment of the Redemption
Price.
In case of a partial redemption, the first notice given shall specify
the last date on which exchanges or transfers of Securities may be made
pursuant to Section 305, and the second notice shall specify the serial
numbers of the Bearer Securities called for redemption and, in the case of
Registered Securities, the serial numbers and the portions thereof called for
redemption.
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 of and at the expense of the Company.
SECTION 1006. Deposit of Redemption Price.
Prior to any Redemption Date, the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
Agent, aggregate and hold in trust as provided in Section 1003) an amount of
money sufficient to pay the Redemption Price of, and
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(except if the Redemption Date shall be an Interest Payment Date) accrued
interest on all the Securities which are to be redeemed on that date other
than any Securities called for redemption on that date which have been
converted prior to the date of such deposit.
If any Security called for redemption is converted, any money
deposited with the Trustee or with any Paying Agent or so segregated and held
in trust for the redemption of such Security shall (subject to any right of
the Holder of such Security or any Predecessor Security to receive interest as
provided in the last paragraph of Section 307) be paid to the Company upon
Company Request or, if then held by the Company, shall be discharged from such
trust.
SECTION 1107. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities
so to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cause to bear interest and the coupons for
such interest appertaining to Bearer Securities shall, except to the extent
provided below, be void. Upon surrender of any such Security for redemption in
accordance with said notice, together with all coupons, if any, appertaining
thereto maturing after the Redemption Date, such Security shall be paid by the
Company at the Redemption Price together with accrued interest to the
Redemption Date, provided, however, that instalments of interest on Bearer
Securities whose State Maturity is on or prior to the Redemption Date shall be
payable only upon presentation and surrender of coupons for such interest (at
an office or agency outside the United States except, as otherwise provided in
the forms of Security set forth in Section 202); and provided, further, that
instalments of interest on Registered Securities whose Stated Maturity is on
or prior to the Redemption Date shall be payable to the Holders of such
Securities, or one or more Predecessor Securities, registered as such at the
close of business on the relevant Record Date according to their terms and the
provisions of Section 307.
If any Security called for redemption shall not be paid upon
surrender thereof for redemption, the principal (and premium, if any) shall,
until paid, bear interest from the Redemption Date at the rate prescribed
therefor in the Security.
If any Bearer Security surrendered for redemption shall not be
accompanied by all appurtenant coupons maturing after the Redemption Date,
such Security may be paid after deducting from the Redemption Price as amount
equal to the face amount of all such missing coupons or the surrender of such
missing coupon or coupons may be waived by the Company and the Trustee, if
there be furnished to them such security or indemnity as they may require to
save each of them and any Paying Agent harmless. If thereafter the Holder of
such Security shall surrender to any Paying Agent any such missing coupon in
respect of which a deduction shall have been made from the Redemption Price,
such Holder shall be entitled to receive the amount so deducted, provided,
however, that interest represented by coupons shall be payable only upon
presentation and surrender of these coupons at an office or agency located
outside of the United States (except, as otherwise provided in the forms of
Security set forth in Section 202).
SECTION 1108. Securities Redeemed in Part.
Any Registered Security which is to be redeemed only in part shall be
surrendered at an office or agency of the Company designated for that purpose
pursuant to Section 1002 (with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to
the Company and the Trustee duly executed by, the Holder
59
thereof or the 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 Registered Security or Securities, 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.
ARTICLE TWELVE
REDEMPTION OF SECURITIES AT OPTION OF HOLDERS
SECTION 1201. Redemption at Option of Holders.
The Securities shall be redeemed by the Company at the option of the
Holders thereof, as a whole or in part, under the conditions and at the
Redemption Price for redemption at the option of Holders specified in the
forms of Securities set forth in Section 202 together with accrued interest to
the Redemption Date. Upon the deposit of any Security with a Paying and
Conversion Agent together with a duly signed and completed Notice of
Redemption at Holder's Option, all in accordance with the provisions contained
in the forms of Securities set forth in Section 202, the Holder of such
Security shall be entitled to receive from such Paying and Conversion Agent a
nontransferable receipt of deposit evidencing such deposit. Provided that such
Securities are surrendered for redemption at the option of the Holder in
accordance with the terms hereof, such Securities shall be redeemed on the
Redemption Date and at the Redemption Price specified for redemption at the
option of the Holder, notwithstanding the fact that such Securities have been
called for redemption at the option of the Company on a Redemption Date on or
after (but not before) February 20, 1993.
SECTION 1202. Applicability of Article.
Redemption of Securities at the election of the Holders thereof, as
required by any provision of this Indenture, shall be made in accordance with
such provision and this Article.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities at the
option of the Holders thereof shall relate, in the case of any Registered
Security redeemed or to be redeemed only in part, to the portion of the
principal amount of such Registered Security which has been or is to be
redeemed.
SECTION 1203. Notice of Redemption Date.
Notice of the February 20, 1993 Redemption Date shall be given by the
Company not less than 75 nor more than 100 days prior to the February 20, 1993
Redemption Date to each Holder of Securities in accordance with Section 105.
The notice as to the Redemption Date shall state:
(1) the Redemption Date;
(2) the Redemption Price and accrued interest to the
Redemption Date;
(3) the place or places where such Securities, together in
the case of Bearer Securities with all coupons appertaining thereto
maturing after February 20, 1993 are to be surrendered for payment of
the Redemption Price and such accrued interest and the date by which
Securities must be so surrendered in order to be redeemed;
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(4) that exercise of the option to elect redemption is
irrevocable, except that Holders who provide the option notice will
retain the right to require tendered Securities to be converted,
provided that notice to such effect and the Holder's nontransferable
receipt from the Paying and Conversion Agent representing such
Securities are delivered on or prior to February 20, 1993 to the
Paying and Conversion Agent holding the tendered Securities to be
converted and the other requirements of Article Thirteen are met:
(5) that in the event tendered Securities are converted on
(but not prior to) February 20, 1993, such Holders shall be entitled
to received the interest payable on such Securities on such date; and
(6) the Conversion Price for conversion of Securities.
SECTION 1204. Deposit of Redemption Price.
Prior to the February 20, 1993 Redemption Date, the Company shall
deposit with the Trustee or with a Paying Agent (or, if the Company is acting
as its own Paying Agent, segregate and hold in trust as provided in Section
1003) an amount of money sufficient to pay the Redemption Price of and accrued
interest on all of the Securities which are to be redeemed on that date. If
any Security tendered for a redemption is converted, any money deposited with
the Trustee or with the Paying Agent or so segregated and held in trust for
the redemption of such Security shall (subject to any right of the Holder of
such Security or any Predecessor Security to receive interest as provided in
the last paragraph of Section 307) be paid to the Company on Company Request,
or, if then held by the Company shall be discharged from such trust.
SECTION 1205. Securities Payable on Redemption Date.
Notice of election to redeem having been given as specified in the
forms of Securities set forth in Section 202, the Securities so to be redeemed
shall, as the Redemption Date, become due and payable at the Redemption Price
applicable thereto and from and after such date (unless the Company shall
default in the payment of the Redemption Price and accrued interest) such
Securities shall cease to bear interest and the coupons for such interest
appertaining to Bearer Securities shall, except to the extent provided below,
be void. Upon surrender of any such Security for redemption in accordance with
said notice, together with all coupons, if any, appertaining thereto maturing
after the Redemption Date, such Security shall be paid by the Company at the
Redemption Price together with accrued interest to the Redemption Date.
If any Security shall not be paid upon surrender thereof for
redemption, the principal (and premium, if any) shall, until paid, bear
interest from the Redemption Date at the rate prescribed therefor in such
Security.
If any Bearer Security surrendered for redemption shall not be
accompanied by all appurtenant coupons maturing after the Redemption Date,
such Security may be paid after deducting from the Redemption Price an amount
equal to the face amount of all such missing coupons or the surrender of such
missing coupon or coupons may be waived by the Company and the Trustee, if
there be furnished to them such security or indemnity as they may require to
save each of them and any Paying Agent harmless. If thereafter the Holder of
such Security shall surrender to any Paying Agent any such missing coupon in
respect of which a deduction shall have been made from the Redemption Price,
such Holder shall be entitled to receive the amount so deducted; provided,
however, that interest represented by coupons shall be payable only upon
61
presentation and surrender of those coupons at an office or agency located
outside of the United States (except as otherwise provided in the forms of
Securities set forth in Section 202)
SECTION 1206. Securities Redeemed in Part.
Any Registered Security which is to be redeemed only in part shall be
surrendered at any office or agency of the Company designated for that purpose
pursuant to Section 1002 (with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to
the Company and the Trustee duly executed by the Holder thereof or his
attorney duly authorized in writing), and the Company shall execute and the
Trustee shall authenticate and deliver to the Holder of such Security without
service charge, a new Registered Security or Securities, 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.
ARTICLE THIRTEEN
CONVERSION OF SECURITIES
SECTION 1301. Conversion Privilege and Conversion Price.
Subject to and upon compliance with the provisions of this Article,
at the option of the Holder thereof, any definitive Security or, in the case
of any Registered Security, any portion of the principal amount thereof which
is U.S$5,000 or an integral multiple of U.S.$5,000 may be converted at the
principal amount thereof, or of such portion thereof, into fully paid and
nonassessable shares (calculated as to each conversion to the nearest 1/100 of
a share) of Common Stock, at the Conversion Price, determined as hereinafter
provided, in effect at the time of conversion. Such conversion right shall
commence at the opening of business on the Exchange Date and expire at the
close of business on February 20, 2001. In case a Security or portion thereof
is called for redemption or tendered by the Holder thereof for redemption, such
conversion right in respect of the Security or portion so called or tendered
shall expire at the close of business on the Redemption Date, unless the
Company defaults in making the payment due upon redemption.
The price at which shares of Common Stock shall be delivered upon
conversion (herein called the "Conversion Price") shall be initially
U.S.$85.25 per share of Common Stock. The Conversion Price shall be adjusted
in certain instances as provided in paragraphs (1), (2), (3), (4) and (7) of
Section 1304.
SECTION 1302. Exercise of Conversion Privilege.
In order to exercise the conversion privilege, the Holder of any
definitive Security to be converted shall surrender such Security, together in
the case of Bearer Securities with all unmatured coupons and any matured
coupons in default appertaining thereto, duly endorsed or assigned to the
Company or in blank, at any office or agency of the Company maintained for
that purpose pursuant to Section 1002, accompanied by written notice to the
Company at such office or agency that the Holder elects to convert such
Security or, if less than the entire principal amount thereof is to be
converted, the portion thereof to be converted. Registered Securities
surrendered for conversion during the period from the close of business on any
Regular Record Date next preceding any Interest Payment Date to the opening of
business on such Interest Payment Date shall (except in the case of Registered
Securities or portions thereof which have
62
been called for redemption on a Redemption Date within such period) be
accompanied by payment in funds acceptable to the Company of an amount equal
to the interest payable on such Interest Payment Date on the principal amount
of Registered Securities being surrendered for conversion (or, if such
Registered Security was issued in exchange for a Bearer Security after the
close of Business on such Regular Record Date, by surrender of the coupon
relating to such Interest Payment Date or by payment in such funds in an
amount equal to the interest payable on such Interest Payment Date on the
principal amount of the Registered Security then being converted). Except as
provided in the preceding sentence and subject to the last paragraph of
Section 307, no payment or adjustment shall be made upon any conversion on
account or any interest accrued on the Securities surrendered for conversion
or on account of any dividends on the Common Stock issued upon conversion.
Securities shall be deemed to have been converted immediately prior
to the close of business on the day of surrender of such Securities for
conversion in accordance with the foregoing provisions, and at such time the
rights of the Holders of such Securities as Holders shall cease, and the
Person or Persons entitled to receive the Common Stock issuable upon
conversion shall be treated for all purposes as the record holder or holders
of such Common Stock at such time. As promptly as practicable on or after the
conversion date, the Company shall issue and shall deliver at such office or
agency a certificate or certificates for the number of full shares of Common
Stock issuable upon conversion, together with payment in lieu of any fraction
of a share, as provided in Section 1303.
In the case of any Registered Security which is converted in part
only, upon such conversion the Company shall execute and the Trustee shall
authenticate and deliver to the Holder thereof, at the expense of the Company,
a new Registered Security or Registered Securities of authorized denominations
in aggregate principal amount equal to the unconverted portion of the
principal amount of such Registered Securities.
SECTION 1303. Fractions of Shares.
No fractional shares of Common Stock shall be issued upon conversion
of Securities. If more than one Security shall be surrendered for conversion at
one time by the same Holder, the number of full shares which shall be issuable
upon conversion thereof shall be computed on the basis of the aggregate
principal amount of the Securities (or, in the case of Registered Securities,
specified portions thereof) so surrendered. Instead of any fractional share of
Common Stock which would otherwise be issuable upon the conversion of any
Security or Securities (or in the case of Registered Securities, specified
portions thereof), the Company shall pay a cash adjustment in respect of such
fraction in an amount equal to the current market value of such fractional
interest computed to the nearest cost on the basis of the Closing Market Price
Per Share of the Common Stock on the last day prior to the day of conversion
on which there is such a Closing Market Price Per Share.
SECTION 1304. Adjustment of Conversion Price.
(1) In case at any time after February 20, 1986 the Company shall pay
or make a dividend or other distribution on any class or series of capital
stock of the Company in Common Stock, the Conversion Price in effect at the
opening of business on the day following the date fixed for the determination
of stockholders entitled to receive such dividend or other distribution shall
be reduced by multiplying such Conversion Price by a fraction of which the
numerator shall be the number of shares of Common Stock outstanding at the
close of business on the date fixed for such determination and the denominator
shall be the sum of such number of shares and the total
63
number of shares constituting such dividend or other distribution, such
reduction to become effective immediately after the opening of business on
the day following the date fixed for such determination. For the purpose of
this paragraph (1), the number of shares of Common Stock at any time
outstanding shall not include shares held in the treasury of the Company but
shall include shares issuable in respect of scrip certificates issued in lieu
of fractions of shares of Common Stock. The Company will not pay any dividend
or make any distribution on shares of Common Stock held in the treasury of the
Company.
(2) In case at any time after February 20, 1986 the Company shall
issue rights or warrants to holders of any class or series of its capital
stock entitling them to subscribe for or purchase shares of Common Stock at a
price per share less than the current market price per share (determined as
provided in paragraph (6) of this Section) of the Common Stock on the date
fixed for the determination of stockholders entitled to receive such rights or
warrants, the Conversion Price in effect at the opening of business on the day
following the date fixed for such determination shall be reduced by
multiplying such Conversion Price by a fraction of which the numerator shall
be the number of shares of Common Stock outstanding at the close of business
on the date fixed for such determination plus the number of shares of Common
Stock which the aggregate of the offering price of the total number of shares
of Common Stock so offered for subscription or purchase would purchase at such
current market price and the denominator shall be the number of shares of
Common Stock outstanding at the close of business on the date fixed for such
determination plus the number of shares of Common Stock so offered for
subscription or purchase, such reduction to become effective immediately after
the opening of business on the day following the date fixed for such
determination. For the purposes of this paragraph (2), the number of shares of
Common Stock at any time outstanding shall not include shares held in the
treasury of the Company but shall include shares issuable in respect of scrip
certificates issued in lieu of fractions of shares of Common Stock. The
Company will not issue any rights or warrants in respect of shares of Common
Stock held in the treasury of the Company.
(3) In case at any time after February 20, 1986 outstanding shares of
Common Stock shall be subdivided into a greater number of shares of Common
Stock, the Conversion Price in effect at the opening of business on the day
following the day upon which such subdivision becomes effective shall be
proportionately reduced, and, conversely, in case at any time after
February 20, 1986 outstanding shares of Common Stock shall each be combined
into a smaller number of shares of Common Stock, the Conversion Price in
effect at the opening of business on the day following the day upon which such
combination becomes effective shall be proportionately increased, such
reduction or increase, as the case may be, to become effective immediately
after the opening of business on the day following the day upon which such
subdivision or combination becomes effective.
(4) In case at any time after February 20, 1986 the Company shall, by
dividend or otherwise, distribute to all holders of its Common Stock evidence
of its indebtedness or assets (including securities, but excluding any rights
or warrants referred to in paragraph (2) of this Section, any dividend or
distribution paid in cash out of the earned surplus of the Company and any
dividend or distribution referred to in paragraph (1) of this Section), the
Conversion Price shall be adjusted so that the same shall equal the price
determined by multiplying the Conversion Price in effect immediately prior to
the close of business on the date fixed for the determination of stockholders
entitled to receive such distribution by a fraction of which the numerator
shall be the current market price per share (determined as provided in
paragraph (6) of this Section) of the Common Stock on the date fixed for such
determination less the then
64
fair market value (as determined by the Board of Directors, whose
determination shall be conclusive and described in a Board Resolution) of the
portion of the assets or evidences of indebtedness so distributed applicable
to one share of Common Stock and the denominator shall be such current market
price per share of the Common Stock, such adjustment to become effective
immediately prior to the opening of business on the day following the date
fixed for the determination of stockholders entitled to receive such
distribution.
(5) The reclassification of Common Stock into securities other than Common
Stock (other than any reclassification upon a consolidation or merger to
which Section 1311 applies) shall be deemed to involve (a) a distribution of
such securities other than Common Stock to all holders of Common Stock (and
the effective date of such reclassification shall be deemed to be "the date
fixed for the determination of stockholders entitled to receive such
distribution" and "the date fixed for such determination" within the meaning
of paragraph (4) of this Section), and (b) a subdivision or combination, as
the case may be, of the number of shares of Common Stock outstanding
immediately prior to such reclassification into the number of shares of Common
Stock outstanding immediately thereafter (and the effective date of such
reclassification shall be deemed to be "the day upon which such subdivision
becomes effective" or "the day upon which such combination becomes
effective", as the case may be, and "the day upon which such subdivision or
combination becomes effective" within the meaning of paragraph (3) of this
Section).
(6) For the purpose of any computation under paragraphs (2) and (4) of
this Section, the current market price per share of Common Stock on any date
shall be deemed to be the average of the Closing Market Prices Per Share for
30 consecutive trading days selected by the Company commencing 30 trading
days before the day in question.
(7) The Company may make such reductions in the Conversion Price, in
addition to those required by paragraphs (1), (2), (3) and (4) of this
Section, as it considers to be advisable in order that any event treated for
United States Federal income tax purposes as a dividend of stock or stock
rights shall not be taxable to the recipients.
(8) No adjustment in the Conversion Price shall be required unless such
adjustment would require an increase or decrease of at least 1% in the
Conversion Price; provided, however, that any adjustments which by reason of
this paragraph (3) are not required to be made shall be carried forward and
taken into account in any subsequent adjustment. All calculations shall be
made to the nearest cent or to the nearest one-thousandth of a share, as the
case may be.
SECTION 1305. Notice of Adjustments of Conversion Price.
Whenever the Conversion Price is adjusted as herein provided:
(a) the Company shall compute the Conversion Price in accordance with
Section 1304 and shall prepare a certificate signed by the Treasurer of the
Company setting forth the adjusted Conversion Price and showing in
reasonable detail the facts upon which such adjustment is based, and such
certificate shall forthwith be filed at each office or agency maintained
for the purpose of conversion of Securities pursuant to Section 1002; and
(b) a notice stating that the Conversion Price has been adjusted and
setting forth the adjusted Conversion Price shall as soon as practicable
after the effectiveness of such adjustment be mailed by the Company to all
Registered Holders at their last addresses as
65
they shall appear in the Security Register and shall be published (but only
once) in accordance with Section 105.
SECTION 1306. Notice of Certain Corporate Action.
In case at any time after February 20, 1986:
(a) the Company shall declare a dividend (or any other distribution) on
its Common Stock payable otherwise than in cash out of its earned surplus;
or
(b) the Company shall authorize the granting to the holders of its Common
Stock of rights or warrants to subscribe for or purchase any shares of
capital stock of any class or of any other rights; or
(c) there shall occur any reclassification of the Common Stock of the
Company (other than a subdivision or combination of its outstanding shares
of Common Stock), or any consolidation or merger to which the Company is a
party and for which approval of any stockholders of the Company is required,
or the sale or transfer of all or substantially all of the assets of the
Company; or
(d) there shall occur the voluntary or involuntary dissolution,
liquidation or winding up of the Company;
then the Company shall cause to be filed at each office or agency maintained
for the purpose of conversion of Securities pursuant to Section 1002, and
shall cause to be mailed to all Registered Holders at their last addresses as
they shall appear in the Security Register and shall publish (but only once)
in accordance with Section 106, in each case, at least 20 days (or 10 days in
any case specified in clause (a) or (b) above) prior to the applicable record
date hereinafter specified, a notice stating (x) the date on which a record
is to be taken for the purpose of such dividend, distribution, rights or
warrants, or, if a record is not to be taken, the date as of which the
holders of Common Stock of record to be entitled to such dividend,
distribution, rights or warrants are to be determined, or (y) the date on
which such reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding up is expected to become effective, and
the date as of which it is expected that holders of Common Stock of record
shall be entitled to exchange their shares of Common Stock for securities,
cash or other property deliverable upon such reclassification, consolidation,
merger, sale, transfer, dissolution, liquidation or winding up.
SECTION 1307. Company to Reserve Common Stock.
The Company shall at all times reserve and keep available, free from
pre-emptive rights, out of its authorized but unissued Common Stock, for the
purpose of effecting the conversion of Securities, the full number of shares
of Common Stock then issuable upon the conversion of all Outstanding
Securities.
The Company shall in good faith and as promptly as possible after the
issuance of the Global Security endeavor (i) to cause all registrations with,
and to obtain any approval by, any governmental authority under any Federal
or state law of the United States that may be required before the shares of
Common Stock may be lawfully issued or transferred and delivered pursuant to
this Article and (ii) to list the shares of Common Stock required to be
issued or delivered upon conversion of Securities prior to such issue or
delivery on each national securities exchange on which the outstanding Common
Stock is listed at the time of such delivery.
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SECTION 1308. Taxes on Conversions.
The Company will pay and all stamp, excise or similar taxes or duties that
may be payable in respect of the issue or delivery of shares of Common Stock
on conversion of Securities pursuant hereto. The Company shall not, however,
be required to pay any tax or duty which may be payable in respect of any
transfer involved in the issue and delivery or shares of Common Stock in a
name other than that of the Holder of the Security or Securities to be
converted, and no such issue or delivery shall be made unless and until the
person requesting such issue has paid to the Company the amount of any such
tax or duty, or has established to the satisfaction of the Company that such
tax or duty has been paid.
SECTION 1309. Covenant as to Common Stock.
The Company covenants that all shares of Common Stock which may be issued
upon conversion of Securities will upon issue be fully paid and nonassessable
and, except as provided in Section 1308, the Company will pay all taxes or
duties, liens and charges with respect to the issue thereof.
SECTION 1310. Cancellation of Converted Securities.
All Securities delivered for conversion shall be delivered to the Trustee
to be cancelled by or at the direction of the Trustee, which shall dispose of
the same as provided in Section 309.
SECTION 1311. Provisions in Case of Consolidation, Merger or Sale of
Assets.
In case of any consolidation of the Company with, or merger of the Company
into, any other corporation, or in case of any merger of another corporation
into the Company (other than a merger which does not result in any
reclassification, conversion, exchange or cancellation of outstanding shares
of Common Stock of the Company), or in case of any sale or transfer of all or
substantially all of the assets of the Company, the corporation formed by
such consolidation or resulting from such merger or which acquires such
assets, as the case may be, shall execute and deliver to the Trustee a
supplemental indenture providing that the Holder of each Security then
outstanding shall have the right thereafter, during the period such Security
shall be convertible as specified in Section 1301, to convert such Security
only into the kind and amount of securities, cash and other property
receivable upon such consolidation, merger, sale or transfer by a holder of
the number of shares of Common Stock into which such Security might have been
converted immediately prior to such consolidation, merger, sale or transfer,
assuming such holder of Common Stock failed to exercise his rights of
election, if any, as to the kind or amount of securities, cash or other
property receivable upon such consolidation, merger, sale or transfer
(provided that if the kind or amount of securities, cash and other property
receivable upon such consolidation, merger, sale or transfer is not the same
for each share of Common Stock in respect of which such rights of election
shall not have been exercised ("non-electing share"), then for the purpose of
this Section the kind and amount of securities, cash and other property
receivable upon such consolidation, merger, sale or transfer by each
non-electing share shall be deemed to be the kind and amount so receivable
per share by a plurality of the non-electing shares), and assuming, if such
consolidation, merger, sale or transfer is prior to the Exchange Date, that
the Securities were convertible at the time of such consolidation, merger,
sale or transfer at the initial Conversion Price specified in Section 1301 as
adjusted from February 20, 1986 to such time pursuant to Section 1304. Such
supplemental indenture shall provide for adjustments which shall be as nearly
equivalent as may be practicable to the
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adjustments provided for in this Article. The above provisions of this
Section shall similarly apply to successive consolidations, mergers, sales or
transfers.
SECTION 1312. Responsibility of Trustee for Conversion Provisions.
The Trustee, subject to the provisions of Section 601, and any Conversion
Agent shall not at any time be under any duty or responsibility to any Holder
to determine whether any facts exist which may require any adjustment of the
Conversion Price, or with respect to the nature or extent of any such
adjustment when made, or with respect to the method employed, or herein or in
any supplemental indenture provided to be employed in making the same.
Neither the Trustee, subject to the provisions of Section 601, nor any
Conversion Agent shall be accountable with respect to the validity or value
(or the kind or amount) of any shares of Common Stock, or of any other
securities or property, which may at any time be issued or delivered upon the
conversion of any Security; and it or they do not make any representation
with respect thereto. Neither the Trustee, subject to the provisions of
Section 601, nor any Conversion Agent shall be responsible for any failure of
the Company to make any cash payment or to issue, transfer or deliver any
shares of stock or stock certificates or other securities or property upon
the surrender of any Security for the purpose of conversion; and the Trustee,
subject to the provisions of Section 601, and any Conversion Agent shall not
be responsible for any failure of the Company to comply with any of the
covenants of the Company contained in this Article.
ARTICLE FOURTEEN
SUBORDINATION OF SECURITIES
SECTION 1401. Securities Subordinate to Senior Indebtedness.
The Company covenants and agrees, and each Holder of a Security, by his
acceptance thereof, likewise covenants and agrees, that, to the extent and in
the manner hereinafter set forth in this Article, the indebtedness
represented by the Securities and the payment of the principal of (and
premium, if any) and interest on each and all of the Securities are hereby
expressly made subordinate and subject in right of payment to the prior
payment in full of all Senior Indebtedness.
SECTION 1402. Payment Over of Proceeds Upon Dissolution, Etc.
In the event of (a) any insolvency or bankruptcy case or proceeding, or
any receivership, liquidation, reorganization or other similar case or
proceeding in connection therewith, relative to the Company or to its
creditors, as such, or to its assets, or (b) any liquidation, dissolution or
other winding up of the Company, whether voluntary or involuntary and whether
or not involving insolvency or bankruptcy, or (c) any assignment for the
benefit of creditors or any other marshalling of assets and liabilities of
the Company, then and in any such event, the holders of Senior Indebtedness
shall be entitled to receive payment in full of all amounts due or to become
due on or in respect of all Senior Indebtedness, or provision shall be made
for such payment in money or money's worth, before the Holders of the
Securities are entitled to receive any payment on account of principal of (or
premium, if any) or interest on the Securities, and to that end the holders
of Senior Indebtedness shall be entitled to receive, for application to the
payment thereof, any payment or distribution of any kind or character,
whether in cash, property or securities, which may be payable or deliverable
in respect of the Securities in any such case, proceeding, dissolution,
liquidation or other winding up or event.
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In the event that, notwithstanding the foregoing provisions of this
Section, the Trustee or the Holder of any Security shall have received any
payment or distribution of assets of the Company of any kind or character,
whether in cash, property of securities, before all Senior Indebtedness is
paid in full or payment thereof provided for, and if such facts shall, at or
prior to the time of such payment or distribution, have been made known to
the Trustee or, as the case may be, such Holder, then and in such event such
payment or distribution shall be paid over or delivered forthwith to the
trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee,
agent or other Person making payment or distribution of assets of the Company
for application to the payment of all Senior Indebtedness remaining unpaid,
to the extent necessary to pay all Senior Indebtedness in full, after giving
effect to any concurrent payment or distribution to or for the holders of
Senior Indebtedness.
The consolidation of the Company with, or the merger of the Company into,
another corporation or the liquidation or dissolution of the Company
following the conveyance or transfer of its properties and assets
substantially as an entirety to another corporation upon the terms and
conditions set forth in Article Seven shall not be deemed a dissolution,
winding up, liquidation, reorganization, assignment for the benefit of
creditors or marshalling of assets and liabilities of the Company for the
purposes of this Section if the corporation formed by such consolidation or
into which the Company is merged or which acquires by conveyance or transfer
such properties and assets substantially as an entirety, as the case may be,
shall, as a part of such consolidation, merger, conveyance or transfer,
comply with the conditions set forth in Article Seven.
SECTION 1403. Prior Payment to Senior Indebtedness Upon Acceleration of
Securities.
In the event that any Securities are declared due and payable before their
Stated Maturity, then and in such event the holders of Senior Indebtedness
shall be entitled to receive payment in full of all amounts due or to become
due on or in respect of all Senior Indebtedness, or provision shall be made
for such payment in money or money's worth, before the Holders of the
Securities or coupons appertaining thereto are entitled to receive any
payment by the Company on account of the principal of (or premium, if any) or
interest on the Securities or such coupons or on account of the purchase or
other acquisition of Securities or such coupons.
In the event that, notwithstanding the foregoing, the Company shall make
any payment to the Trustee or the Holder of any Security prohibited by the
foregoing provision of this Section, and if such fact shall, at or prior to
the time of such payment, have been made known to the Trustee or, as the case
may be, such Holder, then and in such event such payment shall be paid over
and delivered forthwith to the Company.
The provisions of this Section shall not apply to any payment with respect
to which Section 1402 would be applicable.
SECTION 1404. No Payment When Senior Indebtedness in Default.
(a) In the event and during the continuation of any default in the payment
of principal of (or premium, if any) or interest on any Senior Indebtedness
beyond any applicable grace period with respect thereto, or in the event that
any event of default with respect to any Senior Indebtedness shall have
occurred and be continuing permitting the holders of such Senior Indebtedness
(or a trustee on behalf of the holders thereof) to declare such Senior
Indebtedness due and payable prior to the date on which it would otherwise
have become due and payable, unless and until such event of default shall
have been cured or waived or shall have
69
ceased to exist and such acceleration shall have been rescinded or annulled,
or in the event any judicial proceeding shall be pending with respect to
any such default in payment or event of default, then no payment shall be
made by the Company on account of principal of (or premium, if any) or
interest on the Securities or on account of the purchase or other acquisition
of Securities.
In the event that, notwithstanding the foregoing, the Company shall make
any payment to the Trustee or the Holder of any Security prohibited by the
foregoing provisions of this Section, and if such fact shall then have been
made known to the Trustee or, as the case may be, such Holder, then and in
such event such payment shall be paid over and delivered forthwith to the
Company.
The provisions of this Section shall not apply to any payment with respect
to which Section 1402 would be applicable.
SECTION 1405. Payment Permitted If No Default.
Nothing contained in this Article or elsewhere in this Indenture or in any
of the Securities shall prevent (a) the Company, at any time except during
the pendency of any case, proceeding, dissolution, liquidation or other
winding up, assignment for the benefit of creditors or other marshalling of
assets and liabilities of the Company referred to in Section 1402 or under
the conditions described in Section 1403 or 1404, from making payments at any
time of principal of (and premium, if any) or interest on the Securities, or
(b) the application by the Trustee of any money deposited with it hereunder
to the payment of or on account of the principal of (and premium, if any) or
interest on the Securities or the retention of such payment by the Holders of
the Securities, if, one day prior to the time of such application by the
Trustee, the Trustee did not have knowledge that such payment would have been
prohibited by the provisions of this Article.
SECTION 1406. Subrogation to Rights of Holders of Senior Indebtedness.
Subject to the payment in full of all Senior Indebtedness, the Holders of
the Securities shall be subrogated to the extent of the payments or
distributions made to the Holders of such Senior Indebtedness pursuant to the
provisions of this Article (equally and ratably with the holders of all
indebtedness of the Company which by its express terms is subordinated to
indebtedness of the Company to substantially the same extent as the
Securities are subordinated and is entitled to like rights of subrogation) to
the rights of the holders of such Senior Indebtedness to receive payments and
distributions of cash, property and securities applicable to the Senior
Indebtedness until the principal of (and premium, if any) and interest on the
Securities shall be paid in full. For purposes of such subrogation, no
payments or distributions to the holders of the Senior Indebtedness of any
cash, property or securities to which the Holders of the Securities or the
Trustee would be entitled except for the provisions of this Article, and no
payments over pursuant to the provisions of this Article to the holders of
Senior Indebtedness by Holders of the Securities or the Trustee, shall, as
among the Company, its creditors other than holders of Senior Indebtedness
and the Holders of the Securities, be deemed to be a payment or distribution
by the Company to or on account of the Senior Indebtedness.
SECTION 1407. Provisions Solely to Define Relative Rights.
The provisions of this Article are and are intended solely for the purpose
of defining the relative rights of the Holders of the Securities on the one
hand and the holders of Senior
70
Indebtedness on the other hand. Nothing contained in this Article or
elsewhere in this Indenture or in the Securities is intended to or shall (a)
impair, as among the Company, its creditors other than holders of Senior
Indebtedness and the Holders of the Securities, the obligation of the Company,
which is absolute and unconditional, to pay to the Holders of the Securities
the principal of (and premium, if any) and interest on the Securities as and
when the same shall become due and payable in accordance with their terms; or
(b) affect the relative rights against the Company of the Holders of the
Securities and creditors of the Company other than the holders of Senior
Indebtedness; or (c) prevent the Trustee or the Holder of any Security from
exercising all remedies otherwise permitted by applicable law upon default
under this Indenture, subject to the rights, if any, under this Article of the
holders of Senior Indebtedness to receive cash, property and securities
otherwise payable or deliverable to the Trustee or such Holder.
SECTION 1408. Trustee to Effectuate Subordination.
Each Holder of a Security by his acceptance thereof authorizes and directs
the Trustee on his behalf to take such action as may be necessary or
appropriate to effectuate the subordination provided in this Article and
appoints the Trustee his attorney-in-fact for any and all such purposes.
SECTION 1409. No Waiver of Subordination Provisions.
No right of any present or future holder of any Senior Indebtedness to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the
Company or by any act or failure to act, in good faith, by any such holder,
or by any non-compliance by the Company with the terms, provisions and
covenants of this Indenture, regardless of any knowledge thereof any such
holder may have or be otherwise charged with.
Without in any way limiting the generality of the foregoing paragraph, the
holders of Senior Indebtedness may, at any time and from time to time,
without the consent of or notice to the Trustee or the Holders of the
Securities, without incurring responsibility to the Holders of the Securities
and without impairing or releasing the subordination provided in this Article
or the obligations hereunder of the Holders of the Securities to the holders
of Senior Indebtedness, do any one or more of the following: (i) change the
manner, place or terms of payment or extend the time of payment of, or renew
or alter, Senior Indebtedness, or otherwise amend or supplement in any manner
Senior Indebtedness or any instrument evidencing the same or any agreement
under which Senior Indebtedness is outstanding; (ii) sell, exchange, release
or otherwise deal with any property pledged, mortgaged or otherwise securing
Senior Indebtedness; (iii) release any Person liable in any manner for the
collection of Senior Indebtedness; and (iv) exercise or refrain from
exercising any rights against the Company and any other Person.
SECTION 1430. Notice to Trustee.
The Company shall give prompt written notice to the Trustee of any fact
known to the Company which would prohibit the making of any payment to or by
the Trustee in respect of the Securities. Notwithstanding the provisions of
this Article or any other provision of this Indenture, the Trustee shall not
be charged with knowledge of the existence of any facts which would prohibit
the making of any payment to or by the Trustee in respect of the Securities,
unless and until the Trustee shall have received written notice thereof from
the Company or a
71
holder of Senior Indebtedness or from any trustee therefor; and, prior to the
receipt of any such written notice, the Trustee, subject to the provisions of
Section 601, shall be entitled in all respects to assume that no such facts
exist.
Subject to the provisions of Sections 601, the Trustee shall be entitled
to rely on the delivery to it of a written notice by a Person representing
himself to be a holder of Senior Indebtedness (or a trustee therefor) to
establish that such notice has been given by a holder of Senior Indebtedness
(or a trustee therefor). In the event that the Trustee determines in good
faith that further evidence is required with respect to the right of any
Person as a holder of Senior Indebtedness to participate in any payment or
distribution pursuant to this Article, the Trustee may request such Person to
furnish evidence to the reasonable satisfaction of the Trustee as to the
amount of Senior Indebtedness held by such Person, the extent to which such
Person is entitled to participate in such payment or distribution and any
other facts pertinent to the rights of such Person under this Article, and if
such evidence is not furnished, the Trustee may defer any payment to such
Person pending judicial determination as to the right of such Person to
receive such payment.
SECTION 1411. Reliance on Judicial Order or Certificate of Liquidating
Agent.
Upon any payment or distribution of assets of the Company referred to in
this Article, the Trustee, subject to the provisions of Section 601, and the
Holders of the Securities shall be entitled to rely upon any order or decree
entered by any court of competent jurisdiction in which such insolvency,
bankruptcy, receivership, liquidation, reorganization, dissolution, winding up
or similar case or proceeding is pending, or a certificate of the trustee in
bankruptcy, liquidating trustee, custodian, receiver, assignee for the benefit
of creditors, agent or other Person making such payment or distribution,
delivered to the Trustee or to the Holders of Securities, for the purpose of
ascertaining the Persons entitled to participate in such payment or
distribution, the holders of the Senior Indebtedness and other indebtedness
of the Company, the amount thereof or payable thereon, the amount or amounts
paid or distributed thereon and all other facts pertinent thereto or to this
Article.
SECTION 1412. Trustee Not Fiduciary for Holders of Senior Indebtedness.
The Trustee shall not be deemed to owe any fiduciary duty to the holders of
Senior Indebtedness and shall not be liable to any such holders if it shall
in good faith mistakenly pay over or distribute to Holders of Securities or
to the Company or to any other Person cash, property or securities to which
any holders of Senior Indebtedness shall be entitled by virtue of this
Article or otherwise.
SECTION 1413. Rights of Trustees as Holder of Senior Indebtedness;
Preservation of Trustee's Rights.
The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article with respect to any Senior Indebtedness
which may at any time be held by it, to the same extent as any other holder
of Senior Indebtedness, and nothing in this Indenture shall deprive the
Trustee of any of its rights as such holder.
Nothing in this Article shall apply to claims of, or payments to, the
Trustee under or pursuant to Section 606.
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SECTION 1414. Article Applicable to Paying Agents.
In case at any time any Paying Agent other than the Trustee shall have
been appointed by the Company and be then acting hereunder, the term
"Trustee" as used in this Article shall in such case (unless the context
otherwise requires) be construed as extending to and including such Paying
Agent within its meaning as fully for all intents and purposes as if such
Paying Agent were named in this Article in addition to or in place of the
Trustee; provided, however, that Section 1413 shall not apply to the Company
or any Affiliate of the Company if it or such Affiliate acts as Paying
Agent.
SECTION 1415. Certain Conversions Deemed Payment.
For the purposes of this Article only, (1) the issuance and delivery of
junior securities upon conversion of Securities in accordance with Article
Thirteen shall not be deemed to constitute a payment or distribution on
account of the principal of or premium or interest on Securities or on
account of the purchase or other acquisition of Securities, and (2) the
payment issuance or delivery of cash, property or securities (other than
junior securities) upon conversion of a Security shall be deemed to
constitute payment on account of principal of such Security. For the
purposes of this Section, the term "junior securities" means (a) shares of
any stock of any class of the Company and (b) securities of the Company which
are subordinated in right of payment to all Senior Indebtedness which may be
outstanding at the time of issuance or delivery of such securities to
substantially the same extent as, or to a greater extent than, the Securities
are so subordinated as provided in this Article. Nothing contained in this
Article or elsewhere is this Indenture or in the Securities is intended to or
shall impair, as among the Company, its creditors other than holders of
Senior Indebtedness and the Holders of the Securities, the right, which is
absolute and unconditional, of the Holder of any Security to convert such
Security in accordance with Article Thirteen.
This instrument may be executed in any number of counterparts, each of
which when so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
73
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, and their respective corporate seal to be hereunto affixed and
attested, all as of the day and year first above written.
CALFED INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------
President and
Chief Executive Officer
Attest:
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
----------------------------
Secretary
[SEAL]
MANUFACTURERS HANOVER TRUST COMPANY
By: /s/ ▇. ▇. ▇▇▇▇▇▇
----------------------------------------
Vice President
Attest:
/s/ ▇. ▇▇▇▇▇▇▇
----------------------------
Trust Officer
[SEAL]
74
STATE OF CALIFORNIA
} ss:
COUNTY OF LOS ANGELES
On the 19th day of February, 1986, before me personally came ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, to me known, who, being by me duly sworn, did depose and may say
that he is President and Chief Executive Officer of CALFED INC., one of the
corporations described in and which executed the foregoing instrument; that
he knows the seal of said corporation; that the seal affixed to said
instrument is such corporate seal; that it was so affixed by authority of the
Board of Directors of said corporation, and that he signed his name thereto
by like authority.
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇
Notary Public--California
Principal Office in Los Angeles County
My Commission Expires October 28, 1988
STATE OF NEW YORK
} ss:
COUNTY OF NEW YORK
On the 19th day of February, 1986, before me personally came ▇.▇. ▇▇▇▇▇▇,
to me known, who, being by me duly sworn, did depose and may say that he is
Vice President of MANUFACTURERS HANOVER TRUST COMPANY, one of the
corporations described in and which executed the foregoing instrument; that
he knows the seal of said corporation; that the seal affixed to said
instrument is such corporate seal; that it was so affixed by authority of the
Board of Directors of said corporation, and that he signed his name thereto
by like authority.
/s/ ▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------
▇▇▇▇▇ ▇▇▇▇▇
Notary Public, State of New York
No. ▇▇-▇▇▇▇▇▇▇
Qualified in New York County
Commission Expires March 30, 1986
75
