-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, SuXrgUFf+8S2lkfYgb/XBq9y9X4AdrFfoqOTktvDjiRZVj3FSF9RnklV2CWAphma /Q7Mw+ENndkRqPalcMTEYw== 0000950134-98-006095.txt : 19980723 0000950134-98-006095.hdr.sgml : 19980723 ACCESSION NUMBER: 0000950134-98-006095 CONFORMED SUBMISSION TYPE: S-3/A PUBLIC DOCUMENT COUNT: 8 FILED AS OF DATE: 19980722 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: ASSOCIATES FIRST CAPITAL CORP CENTRAL INDEX KEY: 0000007974 STANDARD INDUSTRIAL CLASSIFICATION: PERSONAL CREDIT INSTITUTIONS [6141] IRS NUMBER: 060876639 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3/A SEC ACT: SEC FILE NUMBER: 333-55851 FILM NUMBER: 98669951 BUSINESS ADDRESS: STREET 1: 250 E CARPENTER FWY CITY: IRVING STATE: TX ZIP: 75062 BUSINESS PHONE: 2145414000 MAIL ADDRESS: STREET 1: P O BOX 660237 CITY: DALLAS STATE: TX ZIP: 75266-0237 FORMER COMPANY: FORMER CONFORMED NAME: ASSOCIATES FIRST NATIONAL CORP DATE OF NAME CHANGE: 19720518 S-3/A 1 AMENDMENT NO. 1 TO FORM S-3 1 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 22, 1998 REGISTRATION NO. 333-55851 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ------------------------ AMENDMENT NO. 1 TO FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------------------ ASSOCIATES FIRST CAPITAL CORPORATION (Exact name of registrant as specified in charter) DELAWARE 06-0876639 (State or other jurisdiction (I.R.S. Employer of incorporation or organization) Identification No.)
CHESTER D. LONGENECKER, ESQ. 250 EAST CARPENTER FREEWAY EXECUTIVE VICE PRESIDENT IRVING, TX 75062-2729 AND GENERAL COUNSEL 972-652-4000 250 EAST CARPENTER FREEWAY (Address, including zip code, and telephone number, IRVING, TX 75062-2729 including 972-652-4000 area code, or registrant's principal executive (Name, address, including zip code, and telephone offices) number, including area code, of agent for service)
------------------------ Copies to: DAVID P. BICKS, ESQ. TIMOTHY M. HAYES, ESQ. LEBOEUF, LAMB, GREENE & MACRAE, L.L.P. 250 EAST CARPENTER FREEWAY 125 WEST 55TH STREET IRVING, TX 75062-2729 NEW YORK, NY 10019
------------------------ APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC: From time to time after the effective date of this registration statement as determined by market conditions. ------------------------ If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. [ ] If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, please check the following box. [X] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. [ ] ------------------------ CALCULATION OF REGISTRATION FEE
- --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- TITLE OF EACH AMOUNT PROPOSED MAXIMUM PROPOSED MAXIMUM CLASS OF SECURITIES TO BE OFFERING AGGREGATE AMOUNT OF TO BE REGISTERED(1) REGISTERED(2)(3) PRICE PER UNIT(2)(3) OFFERING PRICE(2)(3) REGISTRATION FEE - --------------------------------------------------------------------------------------------------------------------------------- Class A Common Stock, par value $.01 per share and Warrants to purchase Class A Common Stock(4); Debt Securities and Warrants to purchase Debt Securities(5)(6); Preferred Stock, par value $.01 per share.... $1,000,000,000 $1,000,000,000 $295,000(7) - --------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------
(1) Securities registered hereunder (the "Securities") may be sold separately, together or as units with other Securities registered hereunder. The Securities registered hereunder include such indeterminate number of shares of Class A Common Stock or Preferred Stock which may be issued upon conversion of convertible debt securities or convertible Preferred Stock. (2) Estimated in accordance with Rule 457(o) under the Securities Act of 1933, as amended, solely for the purpose of determining the registration fee. Accordingly, the table does not specify by each class information as to the amount to be registered, proposed maximum offering price per unit or the proposed maximum aggregate offering price. (3) Not applicable pursuant to General Instruction IID of Form S-3 under the Securities Act of 1933, as amended. (4) Includes rights associated with and traded with the Class A Common Stock. The value, if any, attributed to the rights is reflected in the price of the Class A Common Stock. (5) Any offering of Debt Securities or Warrants to purchase Debt Securities denominated in any foreign currency or foreign currency units will be treated as the equivalent in U.S. dollars based on the exchange rate applicable to the purchase of such Securities from the Registrant. (6) If any Debt Securities are issued at original issue discount, such greater amount as may result in the initial offering prices for Securities aggregating $1,000,000,000. (7) Previously paid. THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 2 INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE. SUBJECT TO COMPLETION DATED JULY 22, 1998 PROSPECTUS [ASSOCIATES FIRST CAPITAL CORPORATION LOGO] $1,000,000,000 DEBT SECURITIES, DEBT WARRANTS, PREFERRED STOCK, CLASS A COMMON STOCK AND STOCK WARRANTS ------------------------ Associates First Capital Corporation, a Delaware corporation (the "Company"), may offer and sell from time to time, together or separately, (i) its unsecured debt securities ("Debt Securities"), which may either be senior (the "Senior Debt Securities") or subordinated (the "Subordinated Debt Securities") in priority of payment, (ii) warrants ("Debt Warrants") to purchase Debt Securities, (iii) shares of its preferred stock, par value $.01 per share (the "Preferred Stock"), (iv) shares of its Class A Common Stock, par value $.01 per share (the "Class A Common Stock"), or (v) warrants ("Stock Warrants") to purchase shares of Class A Common Stock (the Debt Securities, the Debt Warrants, the Preferred Stock, the Class A Common Stock and the Stock Warrants are collectively referred to herein as the "Securities"), in amounts, at prices and on terms to be determined at the time of the offering thereof. The Debt Securities and Debt Warrants may be sold for U.S. dollars, foreign currencies or foreign currency units, and the principal of and any interest on the Debt Securities may be payable in U.S. dollars, foreign currencies or foreign currency units. The Securities offered pursuant to this Prospectus by the Company may be issued in one or more series or issuances, the aggregate offering price of which will not exceed $1,000,000,000 (or the equivalent thereof if Debt Securities or Debt Warrants are denominated in one or more foreign currencies or foreign currency units). The specific terms of the Securities in respect of which this Prospectus is being delivered will be set forth in the accompanying Prospectus Supplement ("Prospectus Supplement") including, where applicable, (i) in the case of Debt Securities, the specific designation, priority, aggregate principal amount, the currency or currency unit for which the Debt Securities may be purchased, the currency or currency unit in which the principal and any interest is payable, the rate (or method of calculation) and time of payment or deferral of payment of any interest, authorized denominations, maturity, offering price, any redemption provisions, any conversion or exchange provisions or other specific terms, (ii) in the case of Preferred Stock, the specific title, number of shares or fractional interests therein, any dividend, liquidation, redemption, exchange, voting, conversion and other rights, preferences and privileges, (iii) in the case of Class A Common Stock, the aggregate number of shares offered and (iv) in the case of Debt Warrants and Stock Warrants, the Debt Securities and Class A Common Stock, respectively, for which each such warrant is exercisable, the exercise price, duration, detachability and other terms of the warrants. The Prospectus Supplement will also contain information, where applicable, about certain United States federal income tax considerations relating to the Securities described in the Prospectus Supplement. All or a portion of the Securities may be issued in permanent or temporary global form. No Securities may be sold without delivery of the applicable Prospectus Supplement describing the method and terms of the offering of the Securities. The Securities may be sold through underwriters or dealers or may be sold by the Company directly or through agents designated from time to time. The names of any underwriters or agents involved in the sale of the Securities in respect to which this Prospectus is being delivered and their compensation will be set forth in the Prospectus Supplement. ------------------------ THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. ------------------------ The date of this Prospectus is July , 1998 3 NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS OR THE ACCOMPANYING PROSPECTUS SUPPLEMENT AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR ANY UNDERWRITER. THIS PROSPECTUS AND THE ACCOMPANYING PROSPECTUS SUPPLEMENT DO NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION. NEITHER THE DELIVERY OF THIS PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT NOR ANY SALE MADE HEREUNDER OR THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF. ------------------------ AVAILABLE INFORMATION The Company is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance therewith files reports and other information with the Securities and Exchange Commission (the "Commission"). Such reports and other information can be inspected and copied at the offices of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549; 500 West Madison Street, Chicago, Illinois 60661; and Seven World Trade Center, New York, New York 10048. Copies of such material can be obtained from the Public Reference Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 at prescribed rates. In addition, the Commission maintains a Website that contains reports, and other information regarding registrants that file electronically, such as the Company. The address of the Commission's Website is http://www.sec.gov. The Company's Class A Common Stock is listed on the New York Stock Exchange (the "Exchange"), and the aforementioned reports and other information concerning the Company may be inspected at the offices of the Exchange, 20 Broad Street, New York, New York 10005. This Prospectus does not contain all information set forth in the Registration Statement and Exhibits thereto which the Company has filed with the Commission under the Securities Act of 1933, as amended, (the "Securities Act"), and to which reference is hereby made. DOCUMENTS INCORPORATED BY REFERENCE The Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1997, its Quarterly Report for the period ended March 31, 1998, its Current Reports on Form 8-K dated January 20, 1998, February 10, 1998, February 12, 1998, March 2, 1998, March 3, 1998, March 19, 1998, April 8, 1998, April 13, 1998, April 14, 1998, April 20, 1998, June 18, 1998 and July 14, 1998 and the description of its Class A Common Stock in its Registration Statement on Form 8-A dated February 23, 1996, filed with the Commission pursuant to the Exchange Act, are hereby incorporated by reference. All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date hereof and prior to the termination of the offering of the Securities offered hereby shall be deemed to be incorporated by reference herein and to be a part hereof from the date of filing such documents. THE COMPANY WILL FURNISH WITHOUT CHARGE TO EACH PERSON TO WHOM THIS PROSPECTUS IS DELIVERED, UPON WRITTEN OR ORAL REQUEST BY SUCH PERSON, A COPY OF ANY OR ALL OF THE DOCUMENTS DESCRIBED ABOVE, OTHER THAN EXHIBITS TO SUCH DOCUMENTS. REQUESTS SHOULD BE ADDRESSED TO: ASSOCIATES FIRST CAPITAL CORPORATION, P.O. BOX 660237, DALLAS, TX 75266-0237, ATTENTION: SECRETARY (TEL. 972-652-4000). 2 4 THE COMPANY Associates First Capital Corporation (the "Company"), a Delaware corporation, is a leading, diversified consumer and commercial finance organization which provides finance, leasing and related services to individual consumers and businesses in the United States and internationally. Associates Corporation of North America ("ACONA"), a wholly-owned subsidiary, is the principal U.S.-based operating subsidiary of the Company. Unless the context otherwise requires, reference to the Company includes the Company and all its subsidiaries. In October 1989, Ford Motor Company ("Ford") acquired the Company. In May 1996, the Company made an initial public offering of 67 million shares of its Class A Common Stock, representing a 19.3% interest in the Company. In connection with the initial public offering, the Company issued 23,603,669 shares of Class A Common Stock to Ford in consideration for the Company's acquisition of the Company's foreign operations, which the Company had previously managed but not owned. In addition, the Company recharacterized the remaining shares of common stock Ford owned into 255,881,180 shares of Class B Common Stock, par value $.01 per share (the "Class B Common Stock") (the Class A Common Stock and the Class B Common Stock is collectively referred to herein as the "Common Stock"). Ford continued to own this controlling interest in the Company's Common Stock until April 1998, when Ford converted its holdings of Class B Common Stock into Class A Common Stock and distributed its entire interest in the Company in the form of a dividend to its stockholders (the "Spin Off"). Accordingly, the Company is no longer a subsidiary of Ford. The Company's consumer finance operations consist of a variety of specialized consumer financing products and services, including home equity lending, personal lending, retail sales finance and credit cards. The Company's commercial finance operations primarily provide retail financing, leasing and wholesale financing for heavy-duty and medium-duty trucks and truck trailers, construction, material handling and other industrial and communications equipment, manufactured housing, recreational vehicle, and auto fleet leasing and other commercial products and services. As part of its consumer finance and commercial finance activities, the Company makes available to its customers credit-related and other insurance products. At December 31, 1997, the Company had aggregate net finance receivables of $55.2 billion, approximately 91% of which were dispersed across the United States and the remaining 9% of which were in foreign countries. The Company's operations outside the United States are conducted principally in Canada and Japan, but also include operations in the United Kingdom, Puerto Rico, Mexico, Costa Rica and Taiwan. At December 31, 1997, the Company had 2,265 offices worldwide. The principal executive offices of the Company are located at 250 East Carpenter Freeway, Irving, TX 75062-2729, and its mailing address is P.O. Box 660237, Dallas, TX 75266-0237 (tel. 972-652-4000). RATIO OF EARNINGS TO FIXED CHARGES The following table sets forth the historical ratios of earnings to fixed charges of the Company for the periods indicated:
THREE MONTHS ENDED YEAR ENDED DECEMBER 31 MARCH 31, - -------------------------------- ------------------ 1993 1994 1995 1996 1997 1998 - ---- ---- ---- ---- ---- ------------------ 1.57 1.61 1.55 1.57 1.59 1.58
For purposes of computing the ratio of earnings to fixed charges, the term "earnings" represents earnings before provision for income taxes, and cumulative effect of changes in accounting principles, plus fixed charges. "Fixed charges" represent interest expense and a portion of rentals representative of an implicit interest factor for such rentals. 3 5 APPLICATION OF PROCEEDS Unless otherwise specified in the Prospectus Supplement which accompanies this Prospectus, the net proceeds from the sale of the Securities will be added to the general funds of the Company to be applied to fund investments in, or extensions of credit to, its subsidiaries; to reduce other outstanding indebtedness (which may include indebtedness owed to its subsidiaries); to fund acquisitions by the Company and its subsidiaries of other companies or finance receivables; or for such other purposes as may be set forth in the Prospectus Supplement. Pending such application, such net proceeds may be temporarily invested or applied to the reduction of short-term debt. The Company expects from time to time to continue to incur short-term and long-term debt and to effect other financings, the amounts of which cannot now be determined. DESCRIPTION OF THE DEBT SECURITIES GENERAL The Debt Securities will constitute either senior or subordinated debt of the Company. The Debt Securities will be issued under one or more separate indentures described below for Senior Debt Securities (each, a "Senior Indenture") or for Subordinated Debt Securities (each, a "Subordinated Indenture"), in each case between the Company and a banking institution organized under the laws of the United States of America or of any State thereof (each, a "Trustee"). The Senior Indentures and the Subordinated Indentures are hereinafter collectively referred to as the "Indentures". The following summary of certain provisions of the Indentures does not purport to be complete and is qualified in its entirety by reference to the applicable Indenture, which is filed as an exhibit to the Registration Statement. All article and section references appearing herein are to articles and sections of the applicable Indenture, and all capitalized terms have the meanings specified in such Indenture. The Company is principally a holding company whose primary sources of funds are cash received from subsidiaries in the form of dividends and other intercompany transfers of funds. Dividend distributions to the Company from ACONA are currently subject to a restriction contained in one public issue of debt maturing on March 15, 1999, which generally limits payments of cash dividends on ACONA's common stock in any year to not more than 50% of consolidated net earnings for such year, subject to certain exceptions. As a holding company, the rights of any creditors of the Company to participate in the assets of any subsidiary upon the latter's liquidation or recapitalization will be subject to the prior claims of the subsidiary's creditors, except to the extent that the Company may itself be a creditor with recognized claims against the subsidiary. Accordingly, all Debt Securities will effectively be subordinated to all existing and future obligations of the Company's subsidiaries. At March 31, 1998, such liabilities of the Company's subsidiaries aggregated $49.7 billion, representing 95.6% of the aggregate indebtedness of the Company and its consolidated subsidiaries. In addition, as of March 31, 1998, approximately $2.3 billion of existing indebtedness of the Company would have ranked pari passu with the Senior Debt Securities and senior to the Subordinated Debt Securities. None of the Indentures limits the amount of Debt Securities which may be issued thereunder, and each Indenture provides that Debt Securities may be issued thereunder up to the aggregate principal amount authorized from time to time by the Company and may be denominated in any currency or currency unit designated by the Company. The Indentures do not restrict the amount of debt that may be incurred by the Company or any subsidiary. The Indentures do not contain any covenant or other provision that is specifically intended to afford any Holder special protection in the event of highly leveraged transactions or any other transactions resulting in a decline in the ratings or credit quality of the Company. Reference is made to the Prospectus Supplement which accompanies this Prospectus for the following terms and other information to the extent applicable with respect to the Debt Securities being offered thereby: (i) the designation, aggregate principal amount, authorized denominations and priority of such Debt Securities; (ii) the percentage of the principal amount at which such Debt Securities will be issued; (iii) the currency, currencies or currency units for which the Debt Securities may be purchased and the currency, currencies or currency units in which the principal of and any interest on such Debt Securities may be payable; (iv) the date on which such Debt 4 6 Securities will mature; (v) the rate per annum at which such Debt Securities will bear interest, if any, or the method of determination of such rate; (vi) the dates on which such interest, if any, will be payable; (vii) the deferral of payment of any interest, (viii) any conversion or exchange provisions; (ix) whether such Debt Securities are to be issued in whole or in part in the form of one or more global securities (each a "Global Security") and, if so, the identity of a depositary (the "Depositary") for such Global Security or Securities; (x) any redemption or sinking fund provisions; and (xi) any additional or other rights, preferences, privileges, limitations and restrictions relating to such Debt Securities. If any of the Securities are sold for foreign currencies or foreign currency units or if the principal of or any interest on any series of Debt Securities is payable in foreign currencies or foreign currency units, the restrictions, elections, tax consequences, specific terms and other information with respect to such issue of Securities and such currencies or currency units will be set forth in the Prospectus Supplement relating thereto. The Debt Securities may be issued in fully registered form without coupons ("Fully Registered Securities"), or in a form registered as to principal only with coupons or in bearer form with coupons. Unless otherwise specified in the Prospectus Supplement, the Debt Securities will be only Fully Registered Securities (sec.sec.3.01, 3.02). In addition, Debt Securities of a series may be issuable in the form of one or more Global Securities, which will be denominated in an amount equal to all or a portion of the aggregate principal amount of such Debt Securities (sec.2.04). See "Global Securities" below. One or more series of Debt Securities may be sold at a substantial discount below their stated principal amount, bearing no interest or interest at a rate which at the time of issuance is below market rates. United States federal income tax consequences and special considerations applicable to any such series will be described in the Prospectus Supplement relating thereto. CONVERSION AND EXCHANGE The terms, if any, on which Debt Securities of any series will be convertible into or exchangeable for Class A Common Stock or Preferred Stock, other securities, property, cash or obligations, or a combination of any of the foregoing, will be summarized in the Prospectus Supplement relating to such series. Such terms may include provisions for conversion or exchange, either on a mandatory basis, at the option of the holder or at the option of the Company. The number of shares of Class A Common Stock or Preferred Stock, other securities, or the property, cash or obligations, to be received by the holders of the Debt Securities upon conversion or exchange, will be calculated according to the factors and at such time as are summarized in the related Prospectus Supplement. GLOBAL SECURITIES The Debt Securities of a series may be issued in whole or in part in the form of one or more Global Securities that will be deposited with, or on behalf of, the Depositary identified in the Prospectus Supplement relating to such series. Unless and until it is exchanged in whole or in part for Debt Securities in individually certificated form, a Global Security may not be transferred except as a whole to a nominee of the Depositary for such Global Security, or by a nominee of such Depositary to such Depositary, or to a successor of such Depositary or a nominee of such successor (sec.2.04). The specific terms of the depositary arrangement with respect to any series of Debt Securities and the rights of and limitations on owners of beneficial interests in a Global Security representing all or a portion of a series of Debt Securities will be described in the Prospectus Supplement relating to such series. CERTAIN RESTRICTIVE PROVISIONS None of the Indentures limits the amount of other debt which may be issued by the Company or the amount of dividends or other payments which may be paid with respect to, or the redemption or acquisition of, its equity securities by the Company or its subsidiaries, but each Indenture contains a covenant that neither the Company nor any Finance Subsidiary or Insurance Subsidiary will create or incur any mortgage, pledge, or 5 7 charge of any kind on any of its properties unless effective provision has been made for securing payments on the Debt Securities equally and ratably with the obligations so secured, except for: intercompany mortgages or pledges from subsidiary to parent corporation or to any other Finance Subsidiary or Insurance Subsidiary; purchase money liens or leases; acquisitions of subsidiaries, the physical properties or assets of which are subject to liens; liens created in the ordinary course of business by subsidiaries for money borrowed if such subsidiaries operate in foreign countries or prior to becoming a subsidiary had borrowed on a secured basis; sale and leaseback arrangements upon any real property; renewals or refundings of any of the foregoing; and certain other minor exceptions. Notwithstanding the foregoing, the Company or any such subsidiary may incur mortgages, pledges, encumbrances, liens or charges on indebtedness that would be otherwise prohibited if the aggregate amount of indebtedness secured by such mortgages, pledges, encumbrances, liens or charges, together with all other indebtedness of, or guaranteed by, the Company and any such subsidiaries existing at such time and secured by mortgages, pledges, encumbrances, liens or charges not expressly excepted, does not at the time exceed 15% of the Company's consolidated net worth. Each Indenture also contains a covenant restricting certain transactions by the Company or its subsidiaries with any Controlling Person or Controlling Person Subsidiary (sec.6.02). MODIFICATION OF INDENTURES Each Indenture, the rights and obligations of the Company and the rights of the Holders may be modified with respect to one or more series of Debt Securities issued under such Indenture with the consent of the Holders of not less than 66 2/3% in principal amount of the Outstanding Debt Securities of each such series affected by the modification or amendment. No modification of the terms of payment of principal or interest, and no modification reducing the percentage required for modification is effective against any Holder without his consent. No modification of the Senior Indentures subordinating the indebtedness evidenced by any series of Senior Debt Securities issued thereunder to any other indebtedness of the Company is effective against any Holder of a Senior Security issued thereunder without his consent, and no modification of the Subordinated Indenture subordinating the indebtedness evidenced by any series of Subordinated Debt Securities issued thereunder to any indebtedness of the Company other than Superior Indebtedness is effective against any Holder of Subordinated Debt Securities without his consent. For the purpose of these provisions, a holder of an unexpired Warrant shall be deemed to be the Holder of the principal amount of Debt Securities issuable upon exercise of such Warrant (sec.sec.6.03, 12.01). EVENTS OF DEFAULT Each Indenture provides that the following are Events of Default with respect to any series of Debt Securities issued thereunder: default in the payment of the principal of any Debt Security of such series when and as the same shall be due and payable; default in making a sinking fund payment, if any, when and as the same shall be due and payable by the terms of the Debt Securities of such series; default for 30 days in the payment of any installment of interest on any Debt Security of such series; default for 60 days after notice in the performance of any other covenant in respect of the Debt Securities of such series contained in the Indenture; certain events of bankruptcy, insolvency or reorganization, or court appointment of a receiver, liquidator or trustee of the Company or its property; default for 30 days in the payment of any installment of interest on any evidence of indebtedness (including any other series of Debt Securities issued under the same Indenture) issued, assumed or guaranteed by the Company or default in the payment of any principal of any such evidence of indebtedness; and any other Event of Default provided in the applicable Board Resolution or supplemental indenture under which such series of Debt Securities is issued (sec.8.01). An Event of Default with respect to a particular series of Debt Securities issued under an Indenture does not necessarily constitute an Event of Default with respect to any other series of Debt Securities issued under such Indenture. The appropriate Trustee may withhold notice to the Holders of any series of Debt Securities of any default with respect to such series (except in the payment of principal or interest) if it considers such withholding in the interests of such Holders. If an Event of Default with respect to any series of Debt Securities shall have occurred and be continuing, the appropriate Trustee or the Holders of not less than 25% in aggregate principal amount of the Debt Securities of such series may declare the principal, or in the case of discounted Debt Securities, such portion 6 8 thereof as may be described in the Prospectus Supplement accompanying this Prospectus, of all the Debt Securities of such series to be due and payable immediately (sec.8.01). Within four months after the close of each fiscal year, the Company must file with each Trustee a certificate, signed by specified officers, stating whether or not such officers have knowledge of any default, and, if so, specifying each such default and the nature thereof (sec.6.02). Subject to provisions relating to its duties in case of default, a Trustee shall be under no obligation to exercise any of its rights or powers under the applicable Indenture at the request, order or direction of any Holders, unless such Holders shall have offered to such Trustee reasonable indemnity (sec.9.03). Subject to such provisions for indemnification, the Holders of a majority in principal amount of the Debt Securities of any series may direct the time, method and place of conducting any proceeding for any remedy available to the appropriate Trustee, or exercising any trust or power conferred upon such Trustee, with respect to the Debt Securities of such series (sec.8.06). PAYMENT AND TRANSFER Principal of, premium, if any, and interest, if any, on Fully Registered Securities are to be payable at the Corporate Trust Office of the Trustee under the applicable Indenture or any other office maintained by the Company for such purposes, provided that payment of interest, if any, will be made, unless otherwise provided in the applicable Prospectus Supplement, by check mailed to the persons in whose names such Securities are registered at the close of business on the day or days specified in the Prospectus Supplement accompanying this Prospectus (sec.sec.3.08, 3.11). The principal of, premium, if any, and interest, if any, on Debt Securities in other forms will be payable in such manner and at such place or places as may be designated by the Company and specified in the applicable Prospectus Supplement (sec.3.11). Fully Registered Securities may be transferred or exchanged at the Corporate Trust Office of the Trustee under the applicable Indenture or at any other office or agency maintained by the Company for such purposes, subject to the limitations in the applicable Indenture, without the payment of any service charge except for any tax or governmental charge incidental thereto. Provisions with respect to the transfer and exchange of Debt Securities in other forms will be set forth in the applicable Prospectus Supplement (sec.3.05). SENIOR DEBT SECURITIES -- SUPERIOR INDEBTEDNESS The Senior Debt Securities will constitute part of the Superior Indebtedness of the Company and will rank pari passu with all outstanding senior debt. The outstanding Subordinated Indebtedness and Capital Indebtedness have been subordinated, as to payment of principal, premium, if any, and interest, if any, to all other liabilities of the Company, including the Senior Debt Securities. SUBORDINATED DEBT SECURITIES -- SUBORDINATION The Subordinated Debt Securities will be subordinate and junior in right of payment in all respects to all Superior Indebtedness of the Company, whether outstanding at the date of the Subordinated Indenture or incurred after such date. The term "Superior Indebtedness" is defined to mean (i) all obligations of the Company which in accordance with generally accepted accounting principles are classified as liabilities on the Company's balance sheet and (ii) guaranties of, endorsements and other contingent obligations in respect of, or to purchase or otherwise acquire, indebtedness of others, except other Subordinated Indebtedness and Capital Indebtedness (sec.15.01 of the Subordinated Indenture). "Subordinated Indebtedness" is defined to mean all Indebtedness of the Company which is subordinate and junior in right of payment to Superior Indebtedness, but does not include "Capital Indebtedness", which is defined to be Indebtedness subordinate and junior to Subordinated Indebtedness and Superior Indebtedness (sec.1.01 of the Subordinated Indenture). At March 31, 1998, Superior Indebtedness aggregated approximately $45.0 billion. The amount of additional Superior Indebtedness which the Company may issue is not subject to any limitation. Upon any distribution of assets of the Company in connection with any dissolution, winding up, liquidation or reorganization of the Company, the holders of all Superior Indebtedness will first be entitled to 7 9 receive payment in full of principal of and interest, if any, on such Superior Indebtedness before the Holders of Subordinated Debt Securities are entitled to receive any payment on Subordinated Debt Securities. In the event that any Subordinated Security is declared due and payable because of the occurrence of an Event of Default, under circumstances when the provisions of the foregoing sentence are not applicable, the Trustee under the Subordinated Indenture or the Holders of Subordinated Debt Securities shall be entitled to payment only after there shall first have been paid in full the Superior Indebtedness outstanding at the time such Subordinated Security so becomes due and payable because of such Event of Default (Article Fifteen of the Subordinated Indenture). CONCERNING THE TRUSTEES Business and other relationships (including other trusteeships) between the Company and its affiliates and each Trustee under any Indenture pursuant to which any of the Debt Securities to which the Prospectus Supplement accompanying this Prospectus are described in such Prospectus Supplement. In the event Subordinated Debt Securities are issued pursuant to a Subordinated Indenture with a Trustee which is also a Trustee for Senior Debt Securities pursuant to a Senior Indenture, the occurrence of any default under such Subordinated Indenture or such Senior Indenture could create a conflicting interest for the respective Trustee under the Trust Indenture Act of 1939, as amended (the "1939 Act"). If such default has not been cured or waived within 90 days after such Trustee has or acquires a conflicting interest, such Trustee generally is required by the 1939 Act to eliminate such conflicting interest or resign as Trustee with respect to the Debt Securities issued under such Senior Indenture or such Subordinated Indenture. In the event of the Trustee's resignation, the Company shall promptly appoint a successor trustee with respect to the affected securities. DESCRIPTION OF THE DEBT WARRANTS The following statements with respect to the Debt Warrants are summaries of, and subject to, the detailed provisions of a Debt Warrant Agreement (the "Debt Warrant Agreement") to be entered into by the Company and a warrant agent to be selected at the time of issue (the "Debt Warrant Agent"), a form of which will be filed as an exhibit to a Current Report on Form 8-K relating to any offering of Debt Warrants. GENERAL The Debt Warrants, evidenced by Debt Warrant certificates (the "Debt Warrant Certificates"), may be issued under the Debt Warrant Agreement independently or together with any Securities offered by any Prospectus Supplement and may be attached to or separate from such Securities. If Debt Warrants are offered, the Prospectus Supplement will describe the terms of the Debt Warrants, including the following: (i) the offering price, if any; (ii) the designation, aggregate principal amount, and terms of the Debt Securities purchasable upon exercise of the Debt Warrants; (iii) if applicable, the designation and terms of the Securities with which the Debt Warrants are issued and the number of Debt Warrants issued with each such Security; (iv) if applicable, the date on and after which the Debt Warrants and the related Debt Securities will be separately transferable; (v) the principal amount of Debt Securities purchasable upon exercise of one Debt Warrant and the price at which such principal amount of Debt Securities may be purchased upon such exercise; (vi) the date on which the right to exercise the Debt Warrants shall commence and the date on which such right shall expire; (vii) federal income tax consequences; (viii) whether the Debt Warrants represented by the Debt Warrant Certificates will be issued in registered or bearer form; and (ix) any other terms of the Debt Warrants. Debt Warrant Certificates may be exchanged for new Debt Warrant Certificates of different denominations and may (if in registered form) be presented for registration of transfer at the corporate trust office of the Debt Warrant Agent or any Co-Debt Warrant Agent, which will be identified in the Prospectus Supplement, or at such other office as may be set forth therein. Holders of Debt Warrants do not have any of the rights of Holders of Debt Securities (except to the extent that the consent of holders of Debt Warrants may be required for certain modifications of the terms of the Indenture and the series of Debt Securities issuable upon exercise 8 10 of the Debt Warrants) and are not entitled to payments of principal of and interest, if any, on such Debt Securities. EXERCISE OF DEBT WARRANTS Debt Warrants may be exercised by surrendering the Debt Warrant Certificate at the corporate trust office of the Debt Warrant Agent or at the corporate trust office of the Co-Debt Warrant Agent, if any, with the form of election to purchase on the reverse side of the Debt Warrant Certificate properly completed and executed, and by payment in full of the exercise price, as set forth in the Prospectus Supplement. Upon the exercise of Debt Warrants, the Debt Warrant Agent or Co-Debt Warrant Agent, if any, will, as soon as practicable, deliver the Debt Securities in authorized denominations in accordance with the instructions of the holder exercising the Debt Warrant and at the sole cost and risk of such holder. If less than all of the Debt Warrants evidenced by the Debt Warrant Certificate are exercised, a new Debt Warrant Certificate will be issued for the remaining amount of Debt Warrants. DESCRIPTION OF THE PREFERRED STOCK The following description is a summary of certain provisions of the authorized series of Preferred Stock and does not purport to be complete and is subject to, and is qualified in its entirety by reference to, the Company's bylaws, the Company's Restated Certificate of Incorporation, as amended from time to time, and the Certificate of Designations with respect to each such series adopted by the board of directors (or a duly authorized committee thereof) of the Company, which will be filed with the Commission in connection with the offering of such series of Preferred Stock. The Prospectus Supplement relating to an offering of Preferred Stock (or securities convertible into Preferred Stock) will describe terms relevant thereto including, without limitation, the number of shares offered, the initial offering price and market price and dividend information. GENERAL Pursuant to the Company's Restated Certificate of Incorporation, the Company is authorized to issue up to 50,000,000 shares of Preferred Stock, of which 49,650,000 shares are available for issuance as of the date of this Prospectus. The Preferred Stock is issuable from time to time in one or more series and with such designations and preferences for each series as shall be stated in the Certificate of Designations providing for the designation and issue of each such series adopted by the board of directors of the Company. The board of directors is authorized by the Company's Restated Certificate of Incorporation to determine the voting, dividend, redemption and liquidation preferences and limitations pertaining to such series. The board of directors, without shareholder approval, may issue Preferred Stock with voting and other rights that could adversely affect the voting power of the holders of the Common Stock and could have certain antitakeover effects. The ability of the board of directors to issue Preferred Stock without stockholder approval could have the effect of delaying, deferring or preventing a change in control of the Company or the removal of existing management. See "Certain Matters that may have an Anti-Takeover Effect -- Provisions of the Company's Restated Certificate of Incorporation and Bylaws" below. Any Preferred Stock offered hereby will have the dividend, liquidation and voting rights set forth below unless otherwise provided in the Certificate of Designations, and described in the Prospectus Supplement, relating to a particular series of Preferred Stock. Reference is made to the Prospectus Supplement relating to the particular series of Preferred Stock offered thereby for specific terms, including: (i) the designation and stated value per share of such Preferred Stock and the number of shares offered; (ii) the amount of liquidation preference per share; (iii) the price at which such Preferred Stock will be issued; (iv) the dividend rate (or method of calculation), the dates on which dividends will be payable, whether such dividends will be cumulative or noncumulative and, if cumulative, the dates from which dividends will accrue; (v) any redemption or sinking fund provisions; (vi) any conversion or exchange provisions; and (vii) any additional or other rights, preferences, privileges, limitations and restrictions relating to such series of Preferred Stock. The Company does not currently have any shares of Preferred Stock outstanding. However, the board of directors has reserved 350,000 shares of Series A Preferred Stock for issuance in connection with the Rights 9 11 Plan described below. See "Certain Matters That May Have an Anti-Takeover Effect -- Rights Plan." The Preferred Stock offered hereby will be issued in one or more series. The holders of Preferred Stock will have no preemptive rights. Preferred Stock will be fully paid and nonassessable upon issuance against full payment of the purchase price therefor. Unless otherwise specified in the Certificate of Designations, and described in the Prospectus Supplement, relating to a particular series of Preferred Stock, each series of Preferred Stock will, with respect to dividend rights and rights on liquidation, dissolution and winding up of the Company, rank prior to the Common Stock (the "Junior Stock") and on a parity with each other series of Preferred Stock offered hereby (the "Parity Stock"). DIVIDEND RIGHTS Holders of the Preferred Stock may be entitled to receive, when, as and if declared by the board of directors (or a duly authorized committee thereof) of the Company, out of funds legally available therefor, cash dividends at such rates and on such dates as are set forth in the Certificate of Designations, and described in the Prospectus Supplement, relating to such series of Preferred Stock. Such rate may be fixed or variable or both. Each such dividend will be payable to the holders of record as they appear on the stock record books of the Company on such record dates as may be fixed by the board of directors (or a duly authorized committee thereof) of the Company. Dividends on any series of the Preferred Stock may be cumulative or noncumulative, as provided in the Certificate of Designations, and described in the Prospectus Supplement, relating thereto. If the board of directors of the Company fails to declare a dividend payable on a dividend payment date on any series of Preferred Stock for which dividends are noncumulative, then the right to receive a dividend in respect of the dividend period ending on such dividend payment date will be lost, and the Company will have no obligation to pay the dividend accrued for such period, whether or not dividends on such series are declared for any future period. Dividends on shares of each series of Preferred Stock for which dividends are cumulative will accrue from the date set forth in the Certificate of Designations, and described in the applicable Prospectus Supplement, relating to such series. The Preferred Stock of each series may include customary provisions (i) restricting the payment of dividends or the making of other distributions on, or the redemption, purchase or other acquisition of, Junior Stock unless full dividends, including, in the case of cumulative Preferred Stock, accruals, if any, in respect of prior dividend periods, on the shares of such series of Preferred Stock have been paid and (ii) providing for the pro rata payment of dividends on such series and other Parity Stock when dividends have not been paid in full upon such series and other Parity Stock. VOTING RIGHTS The holders of Preferred Stock of a series offered hereby will not be entitled to vote except as provided in the Certificate of Designations and indicated in the Prospectus Supplement relating to such series of Preferred Stock, or as required by applicable law. REDEMPTION The Company will have such rights, if any, to redeem shares of Preferred Stock, and the holders of Preferred Stock will have such rights, if any, to cause the Company to redeem shares of Preferred Stock, as may be set forth in the Certificate of Designations, and described in the Prospectus Supplement, relating to a series of Preferred Stock. CONVERSION OR EXCHANGE The terms, if any, on which Preferred Stock of a series will be convertible into or exchangeable for Class A Common Stock, other securities, property, cash or obligations, or a combination of any of the foregoing, will be summarized in the Prospectus Supplement relating to such series. Such terms may include provisions for conversion or exchange, either on a mandatory basis, at the option of the holder or at the option of the Company. The number of shares of Class A Common Stock, other securities, or the property, cash or 10 12 obligations, to be received by the holders of a series of Preferred Stock upon conversion or exchange will be calculated according to the factors and at such time as is summarized in the related Prospectus Supplement. RIGHTS UPON LIQUIDATION In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, the holders of each series of Preferred Stock will be entitled to receive out of assets of the Company available for distribution to stockholders, before any distribution of assets is made to holders of Junior Stock, liquidating distributions in the amount set forth in the Certificate of Designations, and described in the Prospectus Supplement, relating to such series of Preferred Stock plus an amount equal to accrued and unpaid dividends. If, upon any voluntary or involuntary liquidation, dissolution or winding up of the Company, the amounts payable with respect to the Preferred Stock of any series are not paid in full, the holders of the Preferred Stock of such series will share ratably in any such distribution of assets of the Company in proration to the full respective preferential amounts (which may include accumulated dividends) to which they are entitled. After payment of the full amount of the liquidating distribution to which they are entitled, the holders of such series of Preferred Stock will have no right or claim to any of the remaining assets of the Company. Neither the sale of all or a portion of the Company's assets nor the merger or consolidation of the Company into or with any other corporation shall be deemed to be a dissolution, liquidation or winding up, voluntarily or involuntarily, of the Company. DESCRIPTION OF THE COMMON STOCK The following description is a summary of certain provisions of the Common Stock and does not purport to be complete and is subject to, and is qualified in its entirety by reference to, the Company's bylaws and Amended and Restated Certificate of Incorporation. The Prospectus Supplement relating to any offering of Class A Common Stock (or securities convertible into Class A Common Stock) will describe terms relevant thereto including, without limitation, the number of shares offered, the initial offering price and market price and dividend information. CLASS A COMMON STOCK Pursuant to the Company's Amended and Restated Certificate of Incorporation, the Company is authorized to issue up to 1,150,000,000 shares of Class A Common Stock. As of June 30, 1998, 346,472,907 shares of Class A Common Stock were issued and outstanding. All shares of Class A Common Stock currently outstanding are, and shares of Class A Common Stock to be issued in connection with any offering will be, fully paid and nonassessable. CLASS B COMMON STOCK Pursuant to the Company's Amended and Restated Certificate of Incorporation, the Company is authorized to issue up to 400,000,000 shares of Class B Common Stock. Prior to the Spin-Off of the Company by Ford, Ford owned 255,881,180 shares of Class B Common Stock, constituting all of the outstanding Class B Common Stock. Immediately prior to the Spin-Off, Ford converted all such shares of Class B Common Stock into Class A Common Stock. Therefore, as of June 30, 1998, no shares of Class B Common Stock were issued and outstanding. The Company's Restated Certificate of Incorporation provides that the Company may not reissue any shares of Class B Common Stock after such Class B Common Stock has been converted into Class A Common Stock. Consequently, the Company has 144,118,820 shares of Class B Common Stock available for issuance. The Company has not registered any shares of Class B Common Stock for issuance under this Prospectus. VOTING RIGHTS The holders of Class A Common Stock and Class B Common Stock generally have identical rights except that holders of Class A Common Stock are entitled to one vote per share while holders of Class B Common Stock are entitled to five votes per share on all matters to be voted on by stockholders. Holders of shares of Class A Common Stock and Class B Common Stock are not entitled to cumulate their votes in the 11 13 election of directors. Generally, all matters to be voted on by stockholders must be approved by a majority (or, in the case of election of directors, by a plurality) of the votes entitled to be cast by all shares of Class A Common Stock and Class B Common Stock present in person or represented by proxy, voting together as a single class, subject to any voting rights granted to holders of any Preferred Stock. Except as otherwise provided by law, and subject to any voting rights granted to holders of any outstanding Preferred Stock, amendments to the Company's Restated Certificate of Incorporation must be approved by a majority of the combined voting power of all of Class A Common Stock and Class B Common Stock, voting together as a single class. However, amendments to the Company's Restated Certificate of Incorporation that would alter or change the powers, preferences or special rights of the Class A Common Stock or the Class B Common Stock so as to affect them adversely also must be approved by a majority of the votes entitled to be cast by the holders of the shares affected by the amendment, voting as a separate class. Notwithstanding the foregoing, any amendment to the Company's Restated Certificate of Incorporation to increase or decrease the authorized shares of any class must be approved upon the affirmative vote of the holders of a majority of the Class A Common Stock and Class B Common Stock, voting together as a single class. DIVIDENDS Holders of Common Stock will share ratably in dividends when, as and if declared by the board of directors out of funds legally available therefor, subject to the rights of holders of any outstanding shares of Preferred Stock. The Company has paid regular quarterly dividends on its Common Stock of $.10 per share in each quarter since the completion of the initial public offering of the Company's Common Stock in May 1996. There can be no assurance that the Company will continue to pay quarterly dividends or that, if paid, the amount of any dividend payments will not decrease. OTHER RIGHTS In the event of any merger or consolidation of the Company with or into another company in connection with which shares of Common Stock are converted into or exchangeable for shares of stock, other securities or property (including cash), all holders of Common Stock, regardless of class, will be entitled to receive the same kind and amount of shares of stock and other securities and property (including cash). On liquidation, dissolution or winding up of the Company, after payment in full of the amounts required to be paid to holders of Preferred Stock, all holders of Common Stock will be entitled to share ratably in any assets available for distribution to holders of shares of Common Stock. No shares of Common Stock are subject to redemption or have preemptive rights to purchase additional shares of Common Stock. TRANSFER AGENT AND REGISTRAR The transfer agent and registrar for the Class A Common Stock is First Chicago Trust Company of New York. DESCRIPTION OF THE STOCK WARRANTS The following statements with respect to the Stock Warrants are summaries of, and subject to, the detailed provisions of a Stock Warrant Agreement (the "Stock Warrant Agreement") to be entered into by the Company and a warrant agent to be selected at the time of issue (the "Stock Warrant Agent"), a form of which will be filed as an exhibit to a Current Report on Form 8-K relating to any offering of Stock Warrants. GENERAL The Stock Warrants, evidenced by Stock Warrant certificates (the "Stock Warrant Certificates"), may be issued under the Stock Warrant Agreement independently or together with any Securities offered by any Prospectus Supplement and may be attached to or separate from such Securities. If Stock Warrants are offered, the Prospectus Supplement will describe the terms of the Stock Warrants, including the following: 12 14 (i) the offering price, if any; (ii) the number of shares of Class A Common Stock purchasable upon exercise of each Stock Warrant and the initial price at which such shares may be purchased upon exercise; (iii) if applicable, the designation and terms of the Securities with which the Stock Warrants are issued and the number of Stock Warrants issued with each such Security; (iv) if applicable, the date on and after which the Stock Warrants and the related Class A Common Stock will be separately transferable; (v) the date on which the right to exercise the Stock Warrants shall commence and the date on which such right shall expire; (vi) federal income tax consequences;(vii) call provisions of such Stock Warrants, if any; (viii) whether the Stock Warrants represented by the Stock Warrant Certificates will be issued in registered or bearer form; and (ix) any additional or other rights, preferences, privileges, limitations and restrictions relating to the Stock Warrants. The shares of Class A Common Stock issuable upon the exercise of the Stock Warrants will, when issued in accordance with the Stock Warrant Agreement, be fully paid and nonassessable. Stock Warrant Certificates may be exchanged for new Stock Warrant Certificates of different denominations and may (if in registered form) be presented for registration of transfer at the corporate trust office of the Stock Warrant Agent or any Co-Stock Warrant Agent, which will be identified in the Prospectus Supplement, or at such other office as may be set forth therein. Holders of Stock Warrant do not have any of the rights of holders of Class A Common Stock (except to the extent that the consent of holders of Stock Warrant may be required for certain modifications of the terms of the Class A Common Stock issuable upon exercise of the Stock Warrants) and are not entitled to dividend payments on the Class A Common Stock purchasable upon such exercise. EXERCISE OF STOCK WARRANTS Stock Warrants may be exercised by surrendering the Stock Warrant Certificate at the corporate trust office of the Stock Warrant Agent or at the corporate trust office of the Co-Stock Warrant Agent, if any, with the form of election to purchase on the reverse side of the Stock Warrant Certificate properly completed and executed, and by payment in full of the exercise price, as set forth in the Prospectus Supplement. Upon the exercise of Stock Warrants, the Stock Warrant Agent or Co-Stock Warrant Agent, if any, will, as soon as practicable, forward a certificate representing the number of shares of Class A Common Stock purchasable upon such exercise in accordance with the instructions of the holder exercising the Stock Warrant and at the sole cost and risk of such holder. If less than all of the Stock Warrants evidenced by the Stock Warrant Certificate are exercised, a new Stock Warrant Certificate will be issued for the remaining amount of Stock Warrants. ANTI-DILUTION PROVISIONS Unless otherwise specified in the applicable Prospectus Supplement, the exercise price payable and the number of shares purchasable upon the exercise of each Stock Warrant will be subject to adjustment in certain events, including (i) the issuance of a stock dividend to holders of Common Stock or a combination, subdivision or reclassification of the Common Stock; (ii) the issuance of rights, warrants or options to all holders of Common Stock entitling the holders thereof to subscribe for or purchase Common Stock for an aggregate consideration per share less than the current market price per share of the Common Stock; or (iii) any distribution by the Company to the holders of its Common Stock of evidences of indebtedness of the Company or of assets (excluding cash dividends or distributions payable out of capital surplus and dividends and distributions referred to in (i) above). No fractional shares will be issued upon exercise of Stock Warrants, but the Company will pay the cash value of any fractional shares otherwise issuable. CERTAIN MATTERS THAT MAY HAVE AN ANTI-TAKEOVER EFFECT PROVISIONS OF THE COMPANY'S RESTATED CERTIFICATE OF INCORPORATION AND BYLAWS Certain provisions of the Company's Restated Certificate of Incorporation and bylaws summarized below may be deemed to have an anti-takeover effect and may delay, deter or prevent a tender offer or takeover 13 15 attempt that a holder of Common Stock might consider to be in its best interest, including attempts that might result in a premium being paid over the market price for shares held by holders of Common Stock. The Company's Restated Certificate of Incorporation and bylaws provide that, subject to any rights of holders of Preferred Stock to elect additional directors under specified circumstances, the number of directors of the Company will not be more than 12 nor less than three, with the exact number of directors of the Company to be fixed from time to time as provided in the bylaws. The bylaws provide that, subject to the rights of holders of Preferred Stock to elect additional directors under specified circumstances, the number of directors will be fixed from time to time exclusively by resolution of the board of directors adopted by the affirmative vote of directors constituting not less than a majority of the total number of directors that the Company would have if there were no vacancies on the Company's board of directors. In addition, the Restated Certificate of Incorporation and bylaws provide that, subject to any rights of holders of Preferred Stock, and unless the Company's board of directors otherwise determines, any vacancies will be filled by the affirmative vote of a majority of the remaining members of the board of directors, though less than a quorum, or by a sole remaining director; except as otherwise provided by law, and such vacancy may not be filled by the stockholders. As of the date of this Prospectus, the Board of Directors has set the number of directors at seven. The Company's bylaws provide for an advance notice procedure for the nomination, other than by or at the direction of the board of directors, of candidates for election as directors as well as for other stockholder proposals to be considered at annual meetings of stockholders. In general, notice of intent to nominate a director or raise matters at such meetings will have to be received in writing by the Company not less than 60 or more than 90 days prior to the anniversary of the previous year's annual meeting of stockholders, and must contain certain information concerning the person to be nominated or the matters to be brought before the meeting and concerning the stockholder submitting the proposal. The Company's Restated Certificate of Incorporation and bylaws also provide that special meetings of stockholders may be called only by certain specified officers of the Company or by any such officer at the request in writing of a majority of the board of directors; special meetings of stockholders cannot be called by stockholders. In addition, the Company's Restated Certificate of Incorporation provides that any action required or permitted to be taken by stockholders may be effected only at a duly called annual or special meeting of stockholders and may not be effected by a written consent by stockholders in lieu of such a meeting. The Company's Restated Certificate of Incorporation also provides that the affirmative vote of the holders of at least 75% of the voting power of all classes of outstanding capital stock, voting together as a single class, is required to amend, repeal or adopt any provision inconsistent with the provisions of the Restated Certificate of Incorporation discussed above. The Restated Certificate of Incorporation and bylaws further provide that the bylaws may be altered, amended or repealed by the affirmative vote of directors constituting not less than a majority of the entire board of directors (if effected by action of the board of directors) or by the affirmative vote of the holders of at least 75% of the total voting power of all classes of outstanding capital stock, voting together as a single class. RIGHTS PLAN On April 8, 1998, the board of directors of the Company declared a dividend of one preferred stock purchase right (a "Right") for each outstanding share of Class A Common Stock. The Company paid the dividend on April 20, 1998 (the "Record Date"), to the stockholders of record on that date. Each Right entitles the registered holder to purchase from the Company one one-thousandth of a share of Series A Junior Participating Preferred Stock, par value $.01 per share (the "Series A Preferred Shares"), of the Company at a price of $400 per one one-thousandth of a Series A Preferred Share (the "Purchase Price"), subject to adjustment. The description and terms of the rights are set forth in a Rights Agreement, dated as of April 13, 1998 (the "Rights Agreement"), between the Company and First Chicago Trust Company of New York, as Rights Agent (the "Rights Agent"), a copy of which is incorporated as an exhibit to the registration statement to which this Prospectus forms a part. Until the earlier to occur of (i) 10 days following a public announcement that a person or group of affiliated or associated persons (an "Acquiring Person") has acquired beneficial ownership of 15% or more of 14 16 the outstanding Class A Common Stock or (ii) 10 business days (or such later date as may be determined by action of the board of directors prior to such time as any person or group of affiliated persons becomes an Acquiring Person) following the commencement of, or announcement of an intention to make, a tender offer or exchange offer the consummation of which would result in the beneficial ownership by a person or group of 15% or more of the outstanding shares of Class A Common Stock (the earlier of such dates being called the "Distribution Date"), the Rights will be evidenced, with respect to any of the Class A Common Stock certificates outstanding as of the Record Date, by such Class A Common Stock certificates together with a copy of the Summary of Rights to Purchase Shares of Preferred Stock, a copy of which is attached as an exhibit to the Rights Agreement ("Summary of Rights"). The Rights Agreement provides that, until the Distribution Date (or earlier redemption or expiration of the Rights), the Rights will be transferred with and only with the shares of Class A Common Stock. Until the Distribution Date (or earlier redemption or expiration of the Rights), new Class A Common Stock certificates issued after the Record Date upon transfer or new issuances of Class A Common Stock will contain a notation incorporating the Rights Agreement by reference. Until the Distribution date (or earlier redemption or expiration of the Rights), the surrender for transfer of any certificates for Class A Common Stock outstanding as of the Record Date, even without such notation or a copy of the Summary of Rights, will also constitute the transfer of the Rights associated with the shares of Class A Common Stock represented by such certificate. As soon as practicable following the Distribution Date, separate certificates evidencing the Rights ("Right Certificates") will be mailed to holders of record of the Class A Common Stock as of the close of business on the Distribution Date and such separate Right Certificates alone will evidence the Rights. The Rights are not exercisable until the Distribution Date. The Rights will expire on April 13, 2008 (the "Final Expiration Date"), unless the Final Expiration Date is extended or unless the Rights are earlier redeemed by the Company, in each case, as described below. The Purchase Price payable, and the number of Series A Preferred Shares or other securities or property issuable, upon exercise of the Rights are subject to adjustment from time to time to prevent dilution (i) in the event of a stock dividend on, or a subdivision, combination or reclassification of, the Series A Preferred Shares, (ii) upon the grant to holders of the Series A Preferred Shares of certain rights or warrants to subscribe for or purchase Series A Preferred Shares at a price, or securities convertible into Series A Preferred Shares with a conversion price, less than the then-current market price of the Series A Preferred Shares or (iii) upon the distribution to holders of the Series A Preferred Shares of evidences of indebtedness or assets (excluding regular periodic cash dividends paid out of earnings or retained earnings or dividends payable in Series A Preferred Shares) or of subscription rights or warrants (other than those referred to above). The number of outstanding Rights is also subject to adjustment in the event of a stock split of the Class A Common Stock or a stock dividend on the Class A Common Stock payable in Class A Common Stock or subdivisions, consolidations or combinations of the Class A Common Stock occurring, in any such case, prior to the Distribution Date. Series A Preferred Shares purchasable upon exercise of the Rights will not be redeemable. Each Preferred Share will be entitled, when, as and if declared to a minimum preferential quarterly dividend payment of $1 per share but will be entitled to an aggregate dividend of 1,000 times the dividend declared per share of Class A Common Stock. In the event of liquidation, the holders of the Series A Preferred Shares will be entitled to a minimum preferential liquidation payment of $1,000 per share (plus any accrued but unpaid dividends) but will be entitled to an aggregate payment of 1,000 times the payment made per share of Class A Common Stock. Each Series A Preferred Share will have 1,000 votes, voting together with the Class A Common Stock. Finally, in the event of any merger, consolidation or other transaction in which shares of Class A Common Stock are exchanged, each Series A Preferred Share will be entitled to receive 1,000 times the amount received per share of Class A Common Stock. These rights are protected by customary antidilution provisions. Because of the nature of the Series A Preferred Shares' dividend, liquidation and voting rights, the value of the one one-thousandth interest in a Series A Preferred Share purchasable upon exercise of each Right should approximate the value of one share of Class A Common Stock. 15 17 In the event that any person or group of affiliated or associated persons becomes an Acquiring Person, the Rights Agreement provides that proper provision shall be made so that each holder of a Right (other than Rights beneficially owned by the Acquiring Person, which will thereafter be void) will thereafter have the right to receive upon exercise of the Right at the then current exercise price of the Right, that number of shares of Class A Common Stock having a market value of two times the exercise price of the Right. In the event that, after a person or group has become an Acquiring Person, the Company is acquired in a merger or other business combination transaction or 50% or more of its consolidated assets or earning power are sold, the Rights Agreement provides that proper provision will be made so that each holder of a Right (other than Rights beneficially owned by an Acquiring Person or certain other transferees, which will have become void) will thereafter have the right to receive, upon the exercise thereof of the Right at the then current exercise price of the Right, that number of shares of common stock of the person with whom the Company has engaged in the foregoing transaction which number of shares at the time of such transaction will have a market value of two times the exercise price of the Right. At any time after any person or group becomes an Acquiring Person and prior to the acquisition by such person or group of 50% or more of the outstanding Class A Common Stock or the occurrence of any event described in the preceding paragraph, the board of directors of the Company may exchange the Rights (other than Rights owned by such person or group which will have become void), in whole or in part, at an exchange ratio of one share of Class A Common Stock, or one one-thousandth of a Series A Preferred Share (or of a share of a class or series of the Company's Preferred Stock having equivalent rights, preferences and privileges), per Right (subject to adjustment). With certain exceptions, no adjustment in the Purchase Price will be required until cumulative adjustments require an adjustment of at least 1% in such Purchase Price. No fractional Series A Preferred Shares will be issued (other than fractions which are integral multiples of one one-thousandth of a Series A Preferred Share, which may, at the election of the Company, be evidenced by depositary receipts) and in lieu thereof, an adjustment in cash will be made based on the market price of the Series A Preferred Shares on the last trading day prior to the date of exercise. At any time prior to the time an Acquiring Person becomes such, the board of directors of the Company may redeem the Rights in whole, but not in part, at a price of $.01 per Right (the "Redemption Price"). The redemption of the Rights may be made effective at such time, on such basis and with such conditions as the Board of Directors in its sole discretion may establish. Immediately upon any redemption of the Rights, the right to exercise the Rights will terminate and the only right of the holders of Rights will be to receive the Redemption Price. For so long as Rights are then redeemable, the Company may, except with respect to the Redemption Price, amend the Rights in any manner. After the Rights are no longer redeemable the Company may, except with respect to the Redemption Price, amend the Rights in any manner that does not adversely affect the interests of holders of the Rights. Until a Right is exercised, the holder thereof, as such, will have no rights as a stockholder of the Company, including, without limitation, the right to vote or to receive dividends. THE DELAWARE GENERAL CORPORATION LAW The Company is a Delaware corporation subject to Section 203 of the Delaware Law General Corporation Law (the "Delaware Law"). Section 203 provides that, subject to certain exceptions specified therein, a corporation shall not engage in any business combination with any "interested stockholder" for a three-year period following the date that such stockholder becomes an interested stockholder unless (i) prior to such time, the board of directors of the corporation approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder, (ii) upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced (excluding certain shares) or (iii) on or subsequent to such time, the business combination is 16 18 approved by the board of directors of the corporation and by the affirmative vote of at least 66 2/3% of the outstanding voting stock which is not owned by the interested stockholder. Except as specified in Section 203 of the Delaware Law, an interested stockholder is defined to include (x) any person that is the owner of 15% or more of the outstanding voting stock of the corporation, or is an affiliate or associate of the corporation and was the owner of 15% or more of the outstanding voting stock of the corporation, at any time within three years immediately prior to the relevant date and (y) the affiliates and associates of any such person. Under certain circumstances, Section 203 of the Delaware Law makes it more difficult for an "interested stockholder" to effect various business combinations with a corporation for a three-year period, although the stockholders may elect to exclude a corporation from the restrictions imposed thereunder. REGULATORY MATTERS Because of the nature of the businesses in which the Company operates, the acquisition of various amounts of its equity securities may not be permitted without regulatory approvals. While the information below is not meant to be complete, below are certain principal regulatory thresholds. The Company indirectly owns all of the capital stock of insurance companies domiciled in the states of Delaware, Indiana, Nevada, Tennessee and Texas. The respective insurance laws of these states require prior approval by the state's insurance commissioner of any acquisition of control of a domestic insurance company or of any company which controls a domestic insurance company. "Control" is presumed to exist through the ownership of 10% or more of the voting securities of a domestic insurance company or of any company which controls a domestic insurance company. Therefore, any person owning 10% or more of the value of the outstanding Common Stock may be presumed to have acquired control of the Company's insurance subsidiaries unless the insurance commissioners of Delaware, Indiana, Nevada, Tennessee and Texas, following application by such purchaser in each such state, determine otherwise. The United Kingdom's Insurance Companies Act 1982 requires the prior approval by the Department of Trade and Industry of anyone proposing to become a "controller" of an insurance company regulated under such Act. Any company or individual that directly or indirectly exercises 10% or more of the voting power at a general meeting of a regulated insurance company is considered a "controller". Therefore, any person owning 10% or more of the value of the outstanding Common Stock will be a controller of the Company's U.K. subsidiaries, Cumberland Insurance Company Limited and Cumberland Life Insurance Co. Limited. The Company directly owns all of the capital stock of Associates National Bank (Delaware) ("ANB") and indirectly owns all of the capital stock of Associates Capital Bank, Inc. ("ACB") the deposits of which are insured by the Federal Deposit Insurance Corporation. The federal Change in Bank Control Act and the regulations issued thereunder require that a person (including an individual) file a notice with the appropriate federal bank regulatory agency prior to acquiring 10% or more of any class of voting securities of a company that controls an insured depository institution such as ANB or ACB. The Company indirectly owns all of the shares of stock of licensed lenders in the states of Georgia, Hawaii, Nevada, New York, Texas and Virginia and in the Commonwealth of Puerto Rico. The lender licensing laws of these states and Puerto Rico require approval by the appropriate regulatory agency prior to any acquisition of control of any company which controls a license. "Control" is presumed to exist through the ownership of 10% or more (25% in Georgia and Virginia) of the voting securities of a licensee or a company that controls a licensee. Therefore any person owning 10% or more (25% in Georgia and Virginia) of the value of the outstanding Common Stock will be presumed to have acquired control of the Company's licensed lenders in these jurisdictions unless the appropriate regulatory agency determines otherwise. LIMITATIONS ON DIRECTORS' LIABILITY The Company's Restated Certificate of Incorporation provides that no director of the Company shall be liable to the Company or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director's duty of loyalty to the Company or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) in respect of certain unlawful dividend payments or stock redemptions or repurchases or (iv) for any 17 19 transaction from which the director derived an improper personal benefit. The effect of these provisions will be to eliminate the rights of the Company and its stockholders (through stockholders' derivative suits on behalf of the Company) to recover monetary damages against a director for breach of fiduciary duty as a director (including breaches resulting from grossly negligent behavior), except in the situations described above. PLAN OF DISTRIBUTION The Company may sell the Securities: (i) through underwriters or dealers; (ii) directly to one or more purchasers; or (iii) through agents. The Prospectus Supplement with respect to the Securities being offered thereby sets forth the terms of the offering of such Securities, including the name or names of any underwriters, the purchase price of such Securities and the proceeds to the Company from such sale, any underwriting discounts and other items constituting underwriters' compensation, any initial public offering price, any discounts or concessions allowed or reallowed or paid to dealers, and any securities exchange on which such Securities may be listed. Only underwriters so named in the Prospectus Supplement are deemed to be underwriters in connection with the Securities offered thereby. If underwriters are used in the sale, the Securities will be acquired by the underwriters for their own account and may be resold from time to time in one or more transactions, including negotiated transactions, at a fixed public offering price or at varying prices determined at the time of sale. The obligations of the underwriters to purchase such Securities will be subject to certain conditions precedent, and the underwriters will be obligated to purchase all the Securities of the series offered by the Company's Prospectus Supplement if any of such Securities are purchased. Any initial public offering price and any discounts or concessions allowed or reallowed or paid to dealers may be changed from time to time. Securities may also be offered and sold, if so indicated in the Prospectus Supplement, in connection with a remarketing upon their purchase, in accordance with a redemption or repayment pursuant to their terms, by one or more firms ("remarketing firms") acting as principals for their own accounts or as agents for the Company. Any remarketing firm will be identified and the terms of its agreement, if any, with the Company and its compensation will be described in the Prospectus Supplement. Remarketing firms may be deemed to be underwriters in connection with the Securities remarketed thereby. Securities may also be sold directly by the Company or through agents designated by the Company from time to time. Any agent involved in the offering and sale of the Securities in respect of which this Prospectus is delivered is named, and any commissions payable by the Company to such agent are set forth, in the Prospectus Supplement. Unless otherwise indicated in the Prospectus Supplement, any such agent is acting on a best efforts basis for the period of its appointment. If so indicated in the Prospectus Supplement, the Company will authorize agents, underwriters or dealers to solicit offers by certain institutional investors to purchase Securities providing for payment and delivery on a future date specified in the Prospectus Supplement. There may be limitations on the minimum amount which may be purchased by any such institutional investor or on the portion of the aggregate principal amount of the particular Securities which may be sold pursuant to such arrangements. Institutional investors to which such offers may be made, when authorized, include commercial and savings banks, insurance companies, pension funds, investment companies, educational and charitable institutions and such other institutions as may be approved by the Company. The obligations of any such purchasers pursuant to such delayed delivery and payment arrangements will not be subject to any conditions except (i) the purchase by an institution of the particular Securities shall not at the time of delivery be prohibited under the laws of any jurisdiction in the United States to which such institution is subject, and (ii) if the particular Securities are being sold to underwriters, the Company shall have sold to such underwriters the total principal amount of such Securities less the principal amount thereof covered by such arrangements. Underwriters will not have any responsibility in respect of the validity of such arrangements or the performance of the Company or such institutional investors thereunder. If any underwriter or any selling group member intends to engage in stabilizing, syndicate short covering transactions, penalty bids or any other transaction in connection with the offering of Securities that may 18 20 stabilize, maintain, or otherwise affect the price of such Securities, such intention and a description of such transactions will be described in the Prospectus Supplement. Agents and underwriters may be entitled under agreements entered into with the Company to indemnification by the Company against certain civil liabilities, including liabilities under the Securities Act of 1933, or to contribution with respect to payments which the agents or underwriters may be required to make in respect thereof. Agents and underwriters may engage in transactions with, or perform services for, the Company in the ordinary course of business. LEGAL OPINIONS The legality of the Securities will be passed upon for the Company by Timothy M. Hayes or Frederic C. Liskow, each an Assistant General Counsel, 250 East Carpenter Freeway, Irving, TX 75062-2729, and for any underwriters by LeBoeuf, Lamb, Greene & MacRae, L.L.P., a limited liability partnership including professional corporations, 125 West 55th Street, New York, New York 10019. Mr. Hayes and Mr. Liskow each own shares of the Company's Class A Common Stock and have options to purchase additional shares of such Class A Common Stock. EXPERTS The consolidated balance sheets as of December 31, 1997 and 1996 and the consolidated statements of earnings, changes in stockholders' equity, and cash flows for each of the three years in the period ended December 31, 1997, incorporated by reference in this Prospectus, have been incorporated herein in reliance on the report of Coopers & Lybrand L.L.P., independent accountants, given on the authority of that firm as experts in accounting and auditing. 19 21 PART II. INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION Filing Fee -- Securities and Exchange Commission............ $ 295,000 Accounting Fees............................................. 100,000 Legal Fees.................................................. None Printing and Engraving...................................... 50,000* Trustees' and Warrant Agent's Charges....................... 25,000* Rating Agency Fees.......................................... 750,000 Blue Sky Fees and Expenses.................................. 100,000 Stock Exchange Listing Fee.................................. 100,000 Miscellaneous............................................... 80,000 ---------- Total............................................. $1,500,000 ==========
- --------------- * Estimated subject to future contingencies ITEM 15. INDEMNIFICATION OF DIRECTOR AND OFFICERS Section 145 of the General Corporation Law of the State of Delaware (the "Delaware Law") empowers a Delaware corporation to indemnify any persons who are, or are threatened to be made, parties to any threatened, pending or completed legal action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of such corporation), by reason of the fact that such person was an officer or director of such corporation, or is or was serving at the request of such corporation as a director, officer, employee or agent of another corporation or enterprise. The indemnity may include expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding, provided that such officer or director acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the corporation's best interests, and, for criminal proceedings, had no reasonable cause to believe his or her conduct was illegal. A Delaware corporation may indemnify officers and directors against expenses (including attorneys' fees) in connection with the defense or settlement of an action by or in the right of the corporation under the same conditions, except that no indemnification is permitted without judicial approval if the officer or director is adjudged to be liable to the corporation. Where an officer or director is successful on the merits or otherwise in the defense of any action referred to above, the corporation must indemnify his or her against the expenses which such officer or director actually and reasonably incurred. In accordance with the Delaware Law, the Restated Certificate of Incorporation of the Company contains a provision to limit the personal liability of the directors of the Company for violations of their fiduciary duty. This provision eliminates each director's liability to the Company for violations of their fiduciary duty. This provision eliminates each director's liability to the Company or its stockholders for monetary damages except (i) for any breach of the director's duty of loyalty to the Company or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the Delaware Law providing for liability of directors for unlawful payment of dividends or unlawful stock purchases or redemptions, or (iv) for any transaction from which a director derived an improper personal benefit. The effect of this provision is to eliminate the personal liability of directors for monetary damages for actions involving a breach of their fiduciary duty of care, including any such actions involving gross negligence. Pursuant to underwriting agreements filed as exhibits to registration statements relating to underwritten offerings of securities, the underwriters parties thereto have agreed to indemnify each officer and director of the Company and each person, if any, who controls the Company within the meaning of the Securities Act of 1933, against certain liabilities, including liabilities under said Act. The directors and officers of the Company are covered by directors' and officers' insurance policies relating to the Company and its subsidiaries. 20 22 The Restated Certificate of Incorporation of the Company provides for indemnification of the officers and directors of the Company to the full extent permitted by applicable law. ITEM 16. EXHIBITS
EXHIBIT NO. DESCRIPTION OF INSTRUMENT ------- ------------------------- 1.1++ -- Form of Underwriting Agreement for dollar denominated Debt Securities and Debt Warrants to be distributed in the United States. Any Underwriting Agreement relating to Debt Securities to be distributed outside the United States or for Securities denominated in foreign currencies or foreign currency units or any modified Underwriting Agreement for dollar denominated Debt Securities to be distributed in the United States and any selling agency or distribution agreement with any agent will be filed as an exhibit to a Current Report on Form 8-K and incorporated herein by reference. 1.2++ -- Form of Underwriting Agreement for Equity Securities. Any Underwriting Agreement relating to Equity Securities to be distributed outside the United States or any modified Underwriting Agreement for Equity Securities to be distributed in the United States will be filed as an exhibit to a Current Report on Form 8-K and incorporated herein by reference. 4.1++ -- Associates First Capital Corporation Standard Multiple-Series Indenture Provisions dated as of June 1, 1998. 4.2++ -- Form of Indenture for Senior Securities dated as of June 1, 1998 between the Company and The Chase Manhattan Bank, as Trustee. The form or forms of Subordinated Securities with respect to each particular offering will be filed as an exhibit to a Current Report on Form 8-K and incorporated herein by reference. 4.3++ -- Form of Indenture for Subordinated Securities date as of June 1, 1998 between the Company and The Chase Manhattan Bank, as Trustee. The form or forms of Subordinated Securities with respect to each particular offering will be filed as an exhibit to a Current Report on Form 8-K and incorporated herein by reference. 4.4* -- Form of Indenture for Senior Securities between the Company and one or more banking institutions to be qualified as Trustee pursuant to Section 305(b)(2) of the Trust Indenture Act of 1939. The form or forms of Senior Securities with respect to each particular offering will be filed as an exhibit to a Current Report on Form 8-K and incorporated herein by reference. 4.5** -- Form of Indenture for Subordinated Securities between the Company and one or more banking institutions to be qualified as Trustee pursuant to Section 305(b)(2) of the Trust Indenture Act of 1939. The form or forms of such Senior Securities with respect to each particular offering will be filed as an exhibit to a Current Report on Form 8-K and incorporated herein by reference. 4.6 -- The form of Warrant Agreement for Debt Securities to be entered into between the Company and the Warrant Agent (including form of Warrant Certificate) will be filed as an exhibit to a Current Report on Form 8-K and incorporated herein by reference. 4.7 -- The form of Warrant Agreement for Class A Common Stock to be entered into between the Company and the Warrant Agent (including form of Warrant Certificate) will be filed as an exhibit to a Current Report on Form 8-K and incorporated herein by reference. 4.8+ -- Rights Agreement, dated as of April 13, 1998, between the Company and First Chicago Trust Company of New York as Rights Agent. 5*** -- Opinion and consent of Timothy M. Hayes.
21 23
EXHIBIT NO. DESCRIPTION OF INSTRUMENT ------- ------------------------- 12 -- The computation of ratio of earnings to fixed charges for the five fiscal years ended December 31, 1997 is incorporated by reference to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1997. The computation of ratio of earnings to fixed charges for the three-month period ended March 31, 1998 is incorporated by reference to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 1998. 23*** -- Consent of Coopers & Lybrand L.L.P. The consents of Timothy M. Hayes and Frederic C. Liskow are included in the opinion referred to in Exhibit 5 above. 24*** -- Powers of Attorney. 25.1++ -- Form T-1, Statement of Eligibility under the Trust Indenture Act of 1939 of The Chase Manhattan Bank, Trustee, under the Indenture dated as of June 1, 1998, pursuant to which Senior Securities may be issued. 25.2++ -- Form T-1, Statement of Eligibility under the Trust Indenture Act of 1939 of The Chase Manhattan Bank, Trustee, under the Indenture dated as of June 1, 1998, pursuant to which Subordinated Securities may be issued.
- --------------- * Incorporated by reference to exhibit 4.2, except for name of Trustee. ** Incorporated by reference to exhibit 4.3, except for name of Trustee. *** Previously filed. + Incorporated by reference to be the Company's Current Report on Form 8-K dated April 8, 1998. ++ Filed herewith. ITEM 17. UNDERTAKINGS. The undersigned registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933 (the "Act"); (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represents a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to 424(b) of the Act if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; and (iii) to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the registration statement is on Form S-3, Form S-8 or Form F-3, and the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Commission by the registrant pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement. 22 24 (2) That, for the purpose of determining any liability under the Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered to which remain unsold at the termination of the offering. (4) That, for the purposes of determining any liability under the Act, each filing of the registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 that is incorporated by reference in this registration statement shall be deemed to be a new registration statement relating to the securities being offered herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (5) To file an application for the purpose of determining the eligibility of the trustee to act under subsection (a) of Section 310 of the Trust Indenture Act in accordance with the rules and regulations prescribed by the Commission under Section 305(b)(2) of the Act. Insofar as indemnification for liabilities arising under the Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the provisions described under Item 15 above, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. 23 25 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Amendment No. 1 to this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Irving, Texas, on the 22nd day of July, 1998. ASSOCIATES FIRST CAPITAL CORPORATION By: /s/ JOHN F. STILLO ------------------------------------ Title: Senior Vice President Pursuant to the requirements of the Securities Act of 1933, this Amendment No. 1 to this Registration Statement has been signed below by the following persons in the capacities and on the date indicated.
SIGNATURE TITLE DATE --------- ----- ---- KEITH W. HUGHES* Chairman of the Board, Chief - --------------------------------------------------- Executive Officer and a (Keith W. Hughes) Director HAROLD D. MARSHALL* President, Chief Operating - --------------------------------------------------- Officer and a Director (Harold D. Marshall) J. CARTER BACOT* Director - --------------------------------------------------- (J. Carter Bacot) ERIC S. DOBKIN* Director - --------------------------------------------------- (Eric S. Dobkin) ROY A. GUTHRIE* Executive Vice President, Chief - --------------------------------------------------- Financial Officer and a (Roy A. Guthrie) Director WILLIAM M. ISAAC* Director - --------------------------------------------------- (William M. Isaac) H. JAMES TOFFEY* Director - --------------------------------------------------- (H. James Toffey) /s/ JOHN F. STILLO Senior Vice President, - --------------------------------------------------- Comptroller and Principal (John F. Stillo) Accounting Officer
- --------------- * By signing his name hereto, John F. Stillo signs this document on behalf of each persons indicated above pursuant to powers of attorney duly executed by such persons. By: /s/ JOHN F. STILLO ---------------------------------- Attorney-in-fact July 22, 1998 24 26 INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION OF INSTRUMENT ------- ------------------------- 1.1++ -- Form of Underwriting Agreement for dollar denominated Debt Securities and Debt Warrants to be distributed in the United States. Any Underwriting Agreement relating to Debt Securities to be distributed outside the United States or for Securities denominated in foreign currencies or foreign currency units or any modified Underwriting Agreement for dollar denominated Debt Securities to be distributed in the United States and any selling agency or distribution agreement with any agent will be filed as an exhibit to a Current Report on Form 8-K and incorporated herein by reference. 1.2++ -- Form of Underwriting Agreement for Equity Securities. Any Underwriting Agreement relating to Equity Securities to be distributed outside the United States or any modified Underwriting Agreement for Equity Securities to be distributed in the United States will be filed as an exhibit to a Current Report on Form 8-K and incorporated herein by reference. 4.1++ -- Associates First Capital Corporation Standard Multiple-Series Indenture Provisions dated as of June 1, 1998. 4.2++ -- Form of Indenture for Senior Securities dated as of June 1, 1998 between the Company and The Chase Manhattan Bank, as Trustee. The form or forms of Senior Securities with respect to each particular offering will be filed as an exhibit to a Current Report on Form 8-K and incorporated herein by reference. 4.3++ -- Form of Indenture for Subordinated Securities date as of June 1, 1998 between the Company and The Chase Manhattan Bank, as Trustee. The form or forms of Subordinated Securities with respect to each particular offering will be filed as an exhibit to a Current Report on Form 8-K and incorporated herein by reference. 4.4* -- Form of Indenture for Senior Securities between the Company and one or more banking institutions to be qualified as Trustee pursuant to Section 305(b)(2) of the Trust Indenture Act of 1939. The form or forms of Senior Securities with respect to each particular offering will be filed as an exhibit to a Current Report on Form 8-K and incorporated herein by reference. 4.5** -- Form of Indenture for Subordinated Securities between the Company and one or more banking institutions to be qualified as Trustee pursuant to Section 305(b)(2) of the Trust Indenture Act of 1939. The form or forms of such Senior Securities with respect to each particular offering will be filed as an exhibit to a Current Report on Form 8-K and incorporated herein by reference. 4.6 -- The Form of Warrant Agreement for Debt Securities to be entered into between the Company and the Warrant Agent (including form of Warrant Certificate) will be filed as an exhibit to a Current Report on Form 8-K and incorporated herein by reference. 4.7 -- The Form of Warrant Agreement for Class A Common Stock to be entered into between the Company and the Warrant Agent (including form of Warrant Certificate) will be filed as an exhibit to a Current Report on Form 8-K and incorporated herein by reference. 4.8+ -- Rights Agreement dated as of April 13, 1998 between the Company and First Chicago Trust Company of New York as Rights Agent. 5*** -- Opinion and consent of Timothy M. Hayes.
25 27
EXHIBIT NO. DESCRIPTION OF INSTRUMENT ------- ------------------------- 12 -- The computation of ratio of earnings to fixed charges for the five fiscal years ended December 31, 1997 is incorporated by reference to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1997. The computation of ratio of earnings to fixed charges for the three-month period ended March 31, 1998 is incorporated by reference to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 1998. Hayes and Frederic C. Liskow are included in the opinion referred to in Exhibit 5 above. 23*** -- Consent of Coopers & Lybrand L.L.P. The consents of Timothy M. Hayes and Frederic C. Liskow are included in the opinion referred to in Exhibit 5 above. 24*** -- Powers of Attorney. 25.1++ -- Form T-1, Statement of Eligibility under the Trust Indenture Act of 1939 of The Chase Manhattan Bank, Trustee, under the Indenture dated as of June 1, 1998, pursuant to which Senior Securities may be issued. 25.2++ -- Form T-1, Statement of Eligibility under the Trust Indenture Act of 1939 of The Chase Manhattan Bank, Trustee, under the Indenture dated as of June 1, 1998, pursuant to which Subordinated Securities may be issued.
- --------------- * Incorporated by reference to exhibit 4.2, except for name of Trustee. ** Incorporated by reference to exhibit 4.3, except for name of Trustee. *** Previously filed. + Incorporated by reference to the Company's Current Report on Form 8-K dated April 8, 1998. ++ Filed herewith. 26 EX-1.1 2 FORM OF UNDERWRITING AGREEMENT (DEBT) 1 EXHIBIT 1.1 ASSOCIATES FIRST CAPITAL CORPORATION DEBT SECURITIES UNDERWRITING AGREEMENT ________, 19__ To the Representative or Representatives named in Schedule A hereto of the Underwriters named in Schedule B hereto Gentlemen: The undersigned Associates First Capital Corporation, a Delaware corporation (the "Company"), confirms its agreement with the several underwriters named in Schedule B hereto (the "Underwriters"), as set forth below. If the firm or firms listed in Schedule B hereto include only the firm or firms listed in Schedule A hereto (the "Representatives"), then the terms "Underwriters" and "Representatives", as used herein, shall each be deemed to refer to such firm or firms. 1. Description of Securities. The Company proposes to issue and sell debt securities of the title and amount set forth in Schedule A hereto (the "Securities"), to be issued under the indenture identified in Schedule A hereto (the "Indenture") between the Company and the trustee named therein (the "Trustee"). If so indicated in Schedule A hereto, the Company also proposes to issue warrants (the "Warrants") to purchase the aggregate principal amount listed in Schedule A hereto of the debt securities listed in Schedule A hereto (the "Warrant Securities") to be issued pursuant to the provisions of the Indenture. The Warrants, if any, are to be issued pursuant to the provisions of the Warrant Agreement listed in Schedule A hereto (the "Warrant Agreement") between the Company and the Warrant Agent named in Schedule A hereto (the "Warrant Agent"). In addition, if so indicated in Schedule A hereto, the Company also proposes to issue certain securities into which the Securities or Warrant Securities may convert, upon such terms and conditions set forth in Schedule A hereto (the "Converted Securities"). 2. Representations and Warranties of the Company. The Company represents and warrants to, and agrees with, each Underwriter that: (a) A registration statement on Form S-3 (with the file numbers set forth in Schedule A hereto), including a prospectus, relating to the Securities, the Warrants, the Warrant Securities and the Converted Securities has been carefully prepared by the Company in conformity with the requirements of the Securities Act of 1933, as amended (the "Act"), the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"), and the rules and regulations (the "Rules and Regulations") of the Securities and Exchange Commission (the "Commission") thereunder, has been filed with the Commission and has become effective. Such registration statement and prospectus may have been amended or supplemented from time to time prior to the date of this Agreement; any such amendment or supplement was so prepared and filed and any such amendment has become effective. A prospectus supplement (the "Prospectus Supplement") relating to the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, has been so prepared and will be filed pursuant to Rule 424 under the Act. Copies of such registration statement and prospectus, any such amendment or supplement, the Prospectus Supplement and all documents incorporated by reference therein which were filed with the Commission on or prior to the date of this Agreement (including one fully executed copy of the registration statement and of each 2 amendment thereto for each of you and for counsel for the Underwriters) have been delivered to you. Such registration statement and prospectus, as amended or supplemented to the date of this Agreement and as supplemented by the Prospectus Supplement, are herein referred to as the "Registration Statement" and the "Prospectus". Any reference herein to the Registration Statement or Prospectus shall be deemed to refer to and include the documents incorporated by reference therein which were filed with the Commission on or prior to the date of this Agreement, and any reference to the terms "amend", "amendment" or "supplement" with respect to the Registration Statement or Prospectus shall be deemed to refer to and include the filing of any document with the Commission deemed to be incorporated by reference therein after the date of this Agreement. (b) When each part of the registration statement became effective such part conformed in all material respects to the requirements of the Act, the Trust Indenture Act and the Rules and Regulations and did not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; and on the date of this Agreement, upon the effectiveness of any amendment to the Registration Statement or the filing of any supplement to the Prospectus and at the Closing Date (as hereinafter defined), the Registration Statement and Prospectus and any amendment or supplement thereto will conform in all material respects to the requirements of the Act, the Trust Indenture Act and the Rules and Regulations and will not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; except that the foregoing shall not apply to statements in or omissions from any such document made in reliance upon, and in conformity with, written information furnished to the Company by you, or by any Underwriter through you, specifically for use in the preparation thereof. (c) The documents incorporated by reference in the Registration Statement or Prospectus, when they became effective or were filed with the Commission, as the case may be, under the Securities Exchange Act of 1934 (the "Exchange Act"), conformed, and any documents so filed and incorporated by reference after the date of this Agreement will, when they are filed with the Commission, conform, in all material respects to the requirements of the Act and the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder. (d) The financial statements of the Company and its subsidiaries included in the Registration Statement and Prospectus fairly present the financial condition of the Company and its subsidiaries as of the dates indicated and the results of operations and changes in financial position for the periods therein specified in conformity with generally accepted accounting principles consistently applied throughout the periods involved (except as otherwise stated therein). Coopers & Lybrand LLP, which has examined certain of such financial statements, as set forth in their report included in the Registration Statement and Prospectus, are independent public accountants with respect to the Company and its subsidiaries as required by the Act and the Rules and Regulations. (e) The Company has been duly incorporated and is an existing corporation in good standing under the laws of its jurisdiction of incorporation; the Company's subsidiaries have been duly incorporated and are existing corporations in good standing under the laws of their respective jurisdictions of incorporation; each of the Company and its subsidiaries has full power and authority (corporate and other) to conduct its business as described in the Registration Statement and Prospectus; each of the Company and its subsidiaries is duly qualified to do business in each jurisdiction in which it owns or leases real property or in which the conduct of its business requires 2 3 such qualification, except to the extent that the failure to so qualify would not have a material adverse effect on the financial condition or results of operations of the Company and its subsidiaries taken as a whole; and all of the outstanding shares of capital stock of each such subsidiary have been duly authorized and validly issued, are fully paid and non-assessable and the Company owns all outstanding shares of capital stock of each significant subsidiary (as defined in Rule 405 under the Act) (except as otherwise stated in the Registration Statement) in each such case subject to no security interest, other encumbrance or adverse claim. (f) The Indenture, the Warrant Agreement, if any, the Securities, the Warrants, if any, and the Warrant Securities, if any, have been duly authorized, the Indenture has been duly qualified under the Trust Indenture Act, executed and delivered, and the Indenture and the Warrant Agreement, if any, constitute, and the Securities, the Warrants, if any, and the Warrant Securities, if any, when duly executed, authenticated, issued and delivered as contemplated hereby, by the Indenture, by the Delayed Delivery Contracts (as hereinafter defined), if any, and by the Warrant Agreement, if any, will constitute valid and legally binding obligations of the Company in accordance with their terms subject, as to enforcement, to bankruptcy, insolvency, reorganization and other laws of general applicability relating to or affecting creditors' rights and to general equity principles; if the Converted Securities are shares of the capital stock of the Company, such shares of capital stock issuable upon conversion of the Securities or Warrant Securities, as applicable, have been duly authorized by the Company, have been duly reserved for issuance upon conversion of the Securities and, when issued upon conversion of the Securities, will be duly and validly issued, fully paid and non-assessable. (g) Except as contemplated in the Prospectus, subsequent to the respective dates as of which information is given in the Registration Statement and the Prospectus, neither the Company nor any of its subsidiaries has incurred any liabilities or obligations, direct or contingent, or entered into any transactions, not in the ordinary course of business, which are material to the Company and its subsidiaries, taken as a whole, and there has not been any material adverse change, on a consolidated basis, in the capital stock, short-term debt or long-term debt of the Company and its subsidiaries, or any material adverse change, or any development involving a prospective material adverse change, in the condition (financial or other), business, prospects, net worth or results of operations of the Company and its subsidiaries taken as a whole. (h) Except as set forth in the Prospectus, there is not pending or, to the knowledge of the Company, threatened, any action, suit or proceeding to which the Company or any of its subsidiaries is a party before or by any court or governmental agency or body, in which there is a reasonable possibility of an adverse decision which could result in any material adverse change in the condition (financial or other), business, prospects, net worth or results of operations of the Company and its subsidiaries, taken as a whole, or might materially and adversely affect the properties or assets thereof; and there are no contracts or documents of the Company or any of its subsidiaries which are required to be filed as exhibits to the Registration Statement by the Act or by the Rules and Regulations which have not been so filed or which will not be so filed prior to the date of any Prospectus Supplement. (i) The Company and its subsidiaries hold good and marketable title in fee simple, except as otherwise stated in the Prospectus, to all of the real property referred to therein as being owned by them, free and clear of all liens and encumbrances, except liens and encumbrances referred to in 3 4 the Prospectus (or reflected in the financial statements included therein) and liens and encumbrances which are not material in the aggregate and do not materially interfere with the conduct of the business of the Company and its subsidiaries taken as a whole; and the properties referred to in the Prospectus as held under lease by the Company or any of its subsidiaries are held by them under valid and enforceable leases with such exceptions as do not materially interfere with the conduct of the business of the Company and its subsidiaries taken as a whole. (j) This Agreement has been duly authorized, executed and delivered; the performance of this Agreement and of any Delayed Delivery Contracts and the consummation of the transactions herein contemplated (including, without limitation, the issuance of the Securities, the Warrant Securities, if any, upon the exercise of the Warrants, if any, and the Converted Securities, if any) will not result in a breach or violation of any of the terms and provisions of, or constitute a default under, any statute, any agreement or instrument to which the Company or any of its subsidiaries is a party or by which any of them is bound or to which any of the property of the Company or any of its subsidiaries is subject, the Company's charter or by-laws, or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Company or any of its properties; no consent, approval, authorization or order of, or filing with, any court or governmental agency or body is required for the consummation of the transactions contemplated by this Agreement and any Delayed Delivery Contracts in connection with the issuance or sale of the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, or the Converted Securities, if any, by the Company, except such as may be required under the Act, the Trust Indenture Act or state securities laws; and the Company has full power and authority to authorize, issue and sell the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, as contemplated by this Agreement. 3. Purchase, Sale and Delivery of Securities. On the basis of the representations, warranties and agreements herein contained, but subject to the terms and conditions herein set forth, the Company agrees to issue and sell to each Underwriter, and each Underwriter agrees, severally and not jointly, to purchase from the Company, at the purchase price set forth in Schedule A hereto, the amount of Securities, and the amount of Warrants, if any, set forth opposite the name of such Underwriter in Schedule B hereto reduced by such Underwriter's portion of any Contract Securities, determined as provided below. If so authorized in Schedule A hereto, the Underwriters may solicit offers from investors of the types set forth in the Prospectus to purchase Securities, and Warrants, if any, from the Company pursuant to delayed delivery contracts ("Delayed Delivery Contracts"). Such contracts shall be substantially in the form of Exhibit I hereto but with such changes therein as the Company may approve. Securities, and Warrants, if any, to be purchased pursuant to Delayed Delivery Contracts are herein called "Contract Securities". When Delayed Delivery Contracts are authorized in Schedule A, the Company will enter into a Delayed Delivery Contract in each case where a sale of Contract Securities arranged through you has been approved by the Company but, except as the Company may otherwise agree, such Delayed Delivery Contracts must be for at least the minimum amount of Contract Securities set forth in Schedule A hereto, and the aggregate amount of Contract Securities may not exceed the amount set forth in such Schedule. The Company will advise you not later than 10:00 A.M., New York City time, on the third full business day preceding the Closing Date (or at such later time as you may otherwise agree) of the sales of the Contract Securities which have been so approved. You and the other Underwriters will not have any responsibility in respect of the validity or performance of Delayed Delivery Contracts. 4 5 The amount of Securities, and Warrants, if any, to be purchased by each Underwriter as set forth in Schedule B hereto shall be reduced by an amount which shall bear the same proportion to the total amount of Contract Securities as the amount of Securities, and Warrants, if any, set forth opposite the name of such Underwriter bears to the total amount of Securities, and Warrants, if any, set forth in Schedule B hereto, except to the extent that you determine that such reduction shall be otherwise than in such proportion and so advise the Company; provided, however, that the total amount of Securities, and Warrants, if any, to be purchased by all Underwriters shall be the total amount of Securities, and Warrants, if any, set forth in Schedule B hereto less the aggregate amount of Contract Securities. The Securities, and the Warrants, if any, to be purchased by the Underwriters will be delivered by the Company to you for the accounts of the several Underwriters at the office specified in Schedule A hereto against payment of the purchase price therefor by wire or interbank transfer of immediately available funds to an account specified by the Company (or, if so specified in Schedule A hereto, by certified or official bank check or checks in immediately available funds payable to the order of the Company at the office specified in Schedule A hereto) on the date and at the time specified in such Schedule A, or at such other time not later than eight full business days thereafter as you and the Company determine, such time being herein referred to as the "Closing Date". Such Securities, and Warrants, if any, will be prepared in definitive form and in such authorized denominations and registered in such names as you may require upon at least two business days' prior notice to the Company and will be made available for checking and packaging at the office at which they are to be delivered on the Closing Date (or such other office as may be specified for that purpose in Schedule A) at least one business day prior to the Closing Date. It is understood that you, acting individually and not in a representative capacity, may (but shall not be obligated to) make payment to the Company on behalf of any other Underwriter for Securities, and Warrants, if any, to be purchased by such Underwriter. Any such payment by you shall not relieve any such Underwriter of any of its obligations hereunder. The Company will pay to you on the Closing Date for the accounts of the Underwriters any fee, commission or other compensation which is specified in Schedule A hereto. Such payment will be made by wire or interbank transfer of immediately available funds to an account that you specify (or, if so specified in Schedule A hereto, by certified or official bank check or checks in New York Clearing House funds to your order at the office specified in Schedule A hereto). 4. Covenants. The Company covenants and agrees with each Underwriter that: (a) The Company will cause the Prospectus Supplement to be filed pursuant to Rule 424 under the Act and will notify you promptly of such filing. During the period in which a prospectus relating to the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, is required to be delivered under the Act, the Company will notify you promptly of the time when any amendment to the Registration Statement has become effective or any subsequent supplement to the Prospectus has been filed and of any request by the Commission for any amendment of or supplement to the Registration Statement or Prospectus or for additional information; it will prepare and file with the Commission, promptly upon your request, any amendments or supplements to the Registration Statement or Prospectus which, in your opinion, may be necessary or advisable in connection with the distribution of the Securities, and the Warrants, if any, by the Underwriters; it will file no amendment or supplement to the Registration Statement or Prospectus (other than any prospectus supplement relating to the offering of securities 5 6 other than the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, registered under the Registration Statement or any document required to be filed under the Exchange Act which upon filing is deemed to be incorporated by reference therein) to which you shall reasonably object by notice to the Company after having been furnished a copy a reasonable time prior to the filing; and it will furnish to you a reasonable time prior to the filing thereof a copy of any such prospectus supplement or any document which upon filing is deemed to be incorporated by reference in the Registration Statement or Prospectus. (b) The Company will advise you, promptly after it shall receive notice or obtain knowledge thereof, of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement, of the suspension of the qualification of the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, for offering or sale in any jurisdiction, or of the initiation or threatening of any proceeding for any such purpose; and it will promptly use its best efforts to prevent the issuance of any stop order or to obtain its withdrawal if such a stop order should be issued. (c) Within the time during which a prospectus relating to the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, is required to be delivered under the Act, the Company will comply as far as it is able with all requirements imposed upon it by the Act, as now and hereafter amended, and by the Rules and Regulations, as from time to time in force, so far as necessary to permit the continuance of sales of or dealings in the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, as contemplated by the provisions hereof and the Prospectus. If during such period any event occurs as a result of which the Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances then existing, not misleading, or if during such period it is necessary to amend or supplement the Registration Statement or Prospectus to comply with the Act, the Company will promptly notify you in writing and will amend or supplement the Registration Statement or Prospectus (at the expense of the Company) so as to correct such statement or omission or effect such compliance. (d) The Company will use its best efforts to qualify the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, for sale under the securities laws of such jurisdictions as you reasonably designate and to continue such qualifications in effect so long as required for the distribution of the Securities, the Warrants, if any, and the Warrant Securities, if any, except that the Company shall not be required in connection therewith to qualify as a foreign corporation or to execute a general consent to service of process in any state. The Company will also arrange for the determination of the eligibility for investment for the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, under the laws of such jurisdictions as you may reasonably request. (e) The Company will furnish to the Underwriters copies of the Registration Statement and Prospectus (including all documents incorporated by reference therein), and all amendments and supplements to the Registration Statement or Prospectus which are filed with the Commission during the period in which a prospectus relating to the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, is required to be delivered under the Act (including all documents filed with the Commission during such period which are deemed to be 6 7 incorporated by reference therein), in each case in such quantities as you may from time to time reasonably request. (f) So long as any of the Securities, the Warrant Securities, if any, and the Converted Securities, if any, are outstanding, the Company agrees to furnish to you as soon as available, copies of all financial reports to the Company's security holders generally (other than Associates First Capital Corporation or other affiliated corporations) and all reports and financial statements filed by or on behalf of the Company with the Commission and the New York Stock Exchange. (g) The Company will make generally available to its security holders as soon as practicable, but in any event not later than 15 months after the end of the Company's current fiscal quarter, an earnings statement (which need not be audited) covering a 12-month period beginning after the date upon which the Prospectus Supplement is filed pursuant to Rule 424 under the Act which shall satisfy the provisions of Section 11(a) of the Act. (h) The Company, whether or not the transactions contemplated hereunder are consummated or this Agreement is terminated, will pay all expenses incident to the performance of its obligations hereunder, will pay the expenses of printing all documents relating to the offering, and will reimburse the Underwriters for any expenses (including fees and disbursements of counsel) incurred by them in connection with the matters referred to in Section 4(d) hereof and the preparation of memoranda relating thereto, for any filing fee of the National Association of Securities Dealers, Inc. relating to the Securities, the Warrants, if any, and the Warrant Securities, if any, and for any fees charged by investment rating agencies for rating the Securities, and the Warrant Securities, if any. If the sale of the Securities, and the Warrants, if any, provided for in this Agreement is not consummated by reason of any failure, refusal or inability on the part of the Company to perform any agreement on its part to be performed, or because any other condition of the Underwriters' obligations hereunder required to be fulfilled by the Company is not fulfilled, the Company will reimburse the Underwriters for all reasonable out-of-pocket disbursements (including fees and disbursements of counsel) incurred by the Underwriters in connection with their preparing to market and marketing the Securities, and the Warrants, if any, or in contemplation of performing their obligations hereunder. The Company shall not in any event be liable to any of the Underwriters for loss of anticipated profits from the transactions covered by this Agreement. (i) The Company will apply the net proceeds of the sale of the Securities, the Warrants, if any, and the Warrant Securities, if any, as set forth in the Prospectus. (j) The Company will not, without your consent, (i) offer or sell, or publicly announce its intention to offer or sell, any debt securities issued by the Company within the United States that are denominated in the same currency as, and are otherwise substantially similar to, the Securities and having a maturity of more than one year (except under prior contractual commitments or pursuant to bank credit agreements) until after the expiration of four consecutive business days beginning with and including the date of this Agreement, and (ii) if the Converted Securities would be shares of the capital stock of the Company, (A) offer for sale, sell or otherwise dispose of, directly or indirectly, any shares of capital stock of the Company of the same class and with the same terms as the converted Securities or permit the registration under the Securities Act of any shares of the capital stock of the Company (other than shares issued pursuant to employee benefit plans, qualified stock option plans or other employee compensation plans), (B) sell or grant options, rights or 7 8 warrants with respect to any shares of the capital stock of the Company (other than the grant of options pursuant to employee benefit plans), or (C) offer for sale, sell or otherwise dispose of, directly or indirectly, any securities convertible into or, exchangeable or exercisable for shares of capital stock of the Company of the same class and with the same terms as the Converted Securities (other than the Securities), in each case until after the date specified in Schedule A hereto; provided, however, that the Company may, without such consent, offer and sell shares of such capital stock of the Company in transactions exempt from the registration requirements of the Securities Act, provided that the purchasers in such transactions are prohibited from offering for sale, selling or otherwise disposing of, directly or indirectly, any of the shares of such capital stock of the Company so acquired by them until after the date specified in Schedule A hereto. 5. Conditions of the Underwriters' Obligations. The obligations of the Underwriters to purchase and pay for the Securities, and Warrants, if any, as provided herein shall be subject to the accuracy, as of the date hereof and the Closing Date (as if made at the Closing Date), of the representations and warranties of the Company herein, to the performance by the Company of its obligations hereunder and to the following additional conditions: (a) No stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceeding for that purpose shall have been instituted or, to the knowledge of the Company or any Underwriter, threatened by the Commission, and any request of the Commission for additional information (to be included in the Registration Statement or the Prospectus or otherwise) shall have been complied with to your reasonable satisfaction. (b) No Underwriter shall have advised the Company that the Registration Statement or Prospectus, or any amendment or supplement thereto, contains an untrue statement of fact which in your opinion is material, or omits to state a fact which in your opinion is material and is required to be stated therein or is necessary to make the statements therein not misleading. (c) Except as contemplated in the Prospectus, subsequent to the respective dates as of which information is given in the Registration Statement and the Prospectus, there shall not have been any material adverse change, on a consolidated basis, in the capital stock, short-term debt or long-term debt of the Company and its subsidiaries, or any material adverse change, or any development involving a prospective material adverse change in the condition (financial or other), business, net worth or results of operations of the Company and its subsidiaries, taken as a whole, or a downgrade in the rating assigned to any securities of the Company, which, in any such case, is, in your reasonable judgment, so material and adverse as to make it impracticable or inadvisable to proceed with the completion of the sale of and payment for the Securities, and the Warrants, if any, on the terms and in the manner contemplated in the Prospectus. (d) You shall have received the opinion of the General Counsel or an Assistant General Counsel to the Company, dated the Closing Date, to the effect that: (i) The Company has been duly incorporated and is an existing corporation in good standing under the laws of its jurisdiction of incorporation; the Company's subsidiaries have been duly incorporated and are existing corporations in good standing under the laws of their respective jurisdictions of incorporation; each of the Company and its subsidiaries has full power and authority (corporate and other) to conduct its business as described in the 8 9 Registration Statement and Prospectus; and each of the Company and its subsidiaries is duly qualified to do business in each jurisdiction in which it owns or leases real property or in which the conduct of its business requires such qualification, except to the extent that the failure to so qualify would not have a material adverse effect on the financial condition or results of operations of the Company and its subsidiaries taken as a whole; and all of the outstanding shares of capital stock of each of the Company's subsidiaries have been duly authorized and validly issued, are fully paid and non-assessable and the Company owns all outstanding shares of capital stock of each significant subsidiary (as defined in Rule 405 under the Act) (except as otherwise stated in the Registration Statement) in each such case subject to no security interest, other encumbrance, or adverse claim; (ii) The Indenture, and the Warrant Agreement, if any, have been duly authorized, executed, delivered, and the Indenture has been qualified under the Trust Indenture Act; the Indenture, and the Warrant Agreement, if any, constitute valid and legally binding instruments in accordance with their terms; the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, have been duly authorized, and the Securities, and Warrants, if any, delivered on the Closing Date have been duly executed, authenticated, issued and delivered; the Securities, and Warrants, if any, delivered on the Closing Date constitute, any Contract Securities when executed, authenticated, issued and delivered in accordance with the Delayed Delivery Contracts, if any, the Warrant Agreement, if any, and the Indenture will constitute, and the Warrant Securities, if any, when executed, authenticated, issued and delivered pursuant to the Warrant Agreement, if any, and the Indenture will constitute, valid and legally binding obligations of the Company in accordance with their terms and the terms of the Indenture, and the Warrant Agreement, if any, subject, as to enforcement, to bankruptcy, insolvency, reorganization and other laws of general applicability relating to or affecting creditors' rights and to general equity principles; if the Converted Securities are shares of capital stock of the Company, such Converted Securities have been duly authorized by the Company, have been duly reserved for issuance upon conversion of the Securities and, when issued upon conversion of the Securities, will be duly and validly issued, fully paid and non-assessable; and the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, conform to the description thereof in the Prospectus; (iii) The Registration Statement has become effective under the Act and, to the best knowledge of such counsel, no stop order suspending the effectiveness of the Registration Statement has been issued and no proceeding for that purpose has been instituted or, to the knowledge of such counsel, threatened by the Commission; (iv) Each part of the registration statement, when such part became effective, and the Registration Statement and the Prospectus, and any amendment or supplement thereto, complied as to form in all material respects with the requirements of the Act, the Trust Indenture Act and the Rules and Regulations; such counsel has no reason to believe that either any part of the registration statement when such part became effective, or the Registration Statement and the Prospectus or any amendment or supplement thereto contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading; and the documents incorporated by reference in the Registration Statement or Prospectus, when they 9 10 became effective under the Act or were filed with the Commission under the Exchange Act, as the case may be, complied as to form in all material respects with the requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder; it being understood that such counsel need express no opinion as to the financial statements or other financial data included in any of the documents mentioned in this clause; (v) The descriptions in the Registration Statement and Prospectus of statutes, legal and governmental proceedings, contracts and other documents are accurate and fairly present the information required to be shown; and such counsel does not know of any statutes or legal or governmental proceedings required to be described in the Prospectus which are not described as required, or of any contracts or documents of a character required to be described in the Registration Statement or Prospectus (or then required to be filed under the Exchange Act if upon such filing they would be incorporated by reference therein) or to be filed as exhibits to the Registration Statement which are not described and filed as required; and (vi) This Agreement and any Delayed Delivery Contracts have been duly authorized, executed and delivered by the Company; the performance thereof and the consummation of the transactions therein contemplated (including, without limitation, the issuance of the Warrant Securities, if any, upon the exercise of the Warrants, if any, or the issuance of the Converted Securities, if any, upon conversion of the Securities or Warrant Securities) will not result in a breach or violation of any of the terms and provisions of, or constitute a default under, any statute, any agreement or instrument known to such counsel to which the Company or any of its subsidiaries is a party or by which it is bound or to which any of the property of the Company or any of its subsidiaries is subject, the Company's charter or by-laws, or any order, rule or regulation known to such counsel of any court or governmental agency or body having jurisdiction over the Company or any of its properties; and no consent, approval, authorization or order of, or filing with, any court or governmental agency or body is required for the consummation of the transactions contemplated by this Agreement and any Delayed Delivery Contracts in connection with the issuance or sale of the Securities (including the Contract Securities, if any), the Warrants, if any, or the Warrant Securities, if any, by the Company, except such as have been obtained under the Act and the Trust Indenture Act and such as may be required under state securities laws in connection with the sale of the Securities, the Warrants, if any, and the Warrant Securities, if any, and the Converted Securities, if any. (e) You shall have received from LeBoeuf, Lamb, Greene & MacRae, L.L.P., counsel for the Underwriters, such opinion or opinions, dated the Closing Date, with respect to the incorporation of the Company, the validity of the Securities, the Warrants, if any, the Warrant Securities, if any, the Converted Securities, if any, the Registration Statement, the Prospectus and other related matters as you reasonably may request, and such counsel shall have received such papers and information as they request to enable them to pass upon such matters. In rendering their opinion, such counsel may rely on certificates of the Trustee under the Indenture as to the execution and authentication of the Securities. (f) You shall have received, on the Closing Date, a letter from Coopers & Lybrand LLP, dated the Closing Date, confirming that they are independent auditors with respect to the Company 10 11 within the meaning of the Act and the applicable published rules and regulations thereunder, and stating, as of the date of such letter (or, with respect to matters involving changes or developments since the respective dates as of which specified financial information is given in the Registration Statement and Prospectus, as of a date not more than three business days prior to the date of such letter), the conclusions and findings of such firm with respect to the financial information and other matters concerning the Company covered by its draft letter reviewed by the Representatives prior to the execution of this Agreement, and affirming, in form and substance satisfactory to the Representatives and in all material respects, the conclusions and findings set forth in such draft letter. (g) You shall have received from the Company a certificate, signed by the Chairman of the Board, a Vice Chairman, the President or a Vice President, and by the principal financial or accounting officer, dated the Closing Date, to the effect that, to the best of their knowledge based upon reasonable investigation: (i) The representations and warranties of the Company in this Agreement are true and correct, as if made at and as of the Closing Date, and the Company has complied with all the agreements and satisfied all the conditions on its part to be performed or satisfied at or prior to the Closing Date; (ii) No stop order suspending the effectiveness of the Registration Statement has been issued, and no proceeding for that purpose has been instituted or is threatened by the Commission; and (iii) Since the date of this Agreement, there has occurred no event required to be set forth in an amendment or supplement to the Registration Statement or Prospectus which has not been so set forth, and there has been no document required to be filed under the Exchange Act and the rules and regulations thereunder that upon such filing would be deemed to be incorporated by reference in the Prospectus that has not been so filed. (h) The Company shall have furnished to you such further certificates and documents as you shall have reasonably requested. All such opinions, certificates, letters and other documents will be in compliance with the provisions hereof only if they are in form and substance reasonably satisfactory to you. The Company will furnish you with such conformed copies of such opinions, certificates, letters and other documents as you shall reasonably request. 6. Indemnification and Contribution. (a) The Company will indemnify and hold harmless each Underwriter against any losses, claims, damages or liabilities, joint or several, to which such Underwriter may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any part of the registration statement when such part became effective, or in the Registration Statement, the Prospectus, or any amendment or supplement thereto, or any related preliminary prospectus supplement, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading; and will reimburse each Underwriter, as incurred, for any legal or other expenses reasonably incurred by it in 11 12 connection with investigating or defending against such loss, claim, damage, liability or action; provided, however, that the Company shall not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made therein in reliance upon and in conformity with written information furnished to the Company by you, or by any Underwriter through you specifically for use in the preparation thereof and provided further that the Company shall not be liable to any Underwriter under the indemnity agreement in this subsection (a) with respect to any preliminary prospectus to the extent that any loss, claim, damage or liability of such Underwriter results from the fact that such Underwriter sold Securities or Warrants, if any, to a person as to whom it is established that there was not sent or given, at or prior to written confirmation of such sale, a copy of the Prospectus (excluding documents incorporated by reference) or of the Prospectus as then amended or supplemented (excluding documents incorporated by reference) in any case where such delivery is required by the Act if the Company notified you in writing in accordance with Section 4(c) hereof and previously furnished copies of the Prospectus (excluding documents incorporated by reference) or of the Prospectus as then amended or supplemented (excluding documents incorporated by reference) in the quantity requested in accordance with Section 4(e) hereof to such Underwriter and the loss, claim, damage or liability of such Underwriter results from an untrue statement or omission of a material fact contained in the preliminary prospectus and corrected in the Prospectus or the Prospectus as then amended or supplemented. (b) Each Underwriter will indemnify and hold harmless the Company against any losses, claims, damages or liabilities to which the Company may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any part of the registration statement when such part became effective, or in the Registration Statement, the Prospectus or any amendment or supplement thereto, or any related preliminary prospectus supplement, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made therein in reliance upon and in conformity with written information furnished to the Company by you, or by such Underwriter through you, specifically for use in the preparation thereof; and will reimburse the Company for any legal or other expenses reasonably incurred by the Company in connection with investigating or defending against any such loss, claim, damage, liability or action. (c) Promptly after receipt by an indemnified party under subsection (a) or (b) above of notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under such subsection, notify the indemnifying party in writing of the commencement thereof; but the omission so to notify the indemnifying party shall not relieve it from any liability which it may have to any indemnified party otherwise than under such subsection. In case any such action shall be brought against any indemnified party, and it shall notify the indemnifying party of the commencement thereof, the indemnifying party shall be entitled to participate in, and, to the extent that it shall wish, jointly with any other indemnifying party, similarly notified, to assume the defense thereof, with counsel satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the indemnifying party), and after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof, the indemnifying party shall not be liable to such indemnified party under such subsection for any legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof other than reasonable costs of investigation. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement 12 13 of any pending or threatening proceeding in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding and does not include a statement as to, or an admission of, fault, culpability or a failure to act by or on behalf of any indemnified party. (d) If the indemnification provided for in this Section 6 is unavailable or insufficient to hold harmless an indemnified party under subsection (a) or (b) above, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of the losses, claims, damages or liabilities referred to in subsection (a) or (b) above, (i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters on the other from the offering of the Securities, and the Warrants, if any, or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company on the one hand and the Underwriters on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Underwriters on the other shall be deemed to be in the same proportion as the total net proceeds from the offering of the Securities (before deducting expenses) received by the Company bear to the total compensation or profit (before deducting expenses) received or realized by the Underwriters from the purchase and resale, or underwriting, of the Securities, and the Warrants, if any. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or the Underwriters and the parties' relative intent, knowledge, access to information and opportunity, and actions and inaction, to correct or prevent such untrue statement or omission. The Company and the Underwriters agree that it would not be just and equitable if contributions pursuant to this subsection (d) were to be determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to in the first sentence of this subsection (d). The amount paid by an indemnified party as a result of the losses, claims, damages or liabilities referred to in the first sentence of this subsection (d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any action or claim (which shall be limited as provided in subsection (c) above if the indemnifying party has assumed the defense of any such action in accordance with the provisions thereof) which is the subject of this subsection (d). Notwithstanding the provisions of this subsection (d), no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Securities, and the Warrants, if any, underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Underwriters' obligations in this subsection (d) to contribute shall be several in proportion to their respective underwriting obligations and not joint. Promptly after receipt by an indemnified party under this subsection (d) of notice of the commencement of any action against such party in respect of which a claim for contribution may be made against an indemnifying party under this subsection (d), such indemnified party shall notify the indemnifying party in writing of the commencement thereof if the notice specified in subsection (c) above has not been given with respect to such action; but the omission so to notify the indemnifying party shall not relieve it from any liability which it may have to any indemnified party otherwise than under this subsection (d). 13 14 (e) The obligations of the Company under this Section 6 shall be in addition to any liability which the Company may otherwise have and shall extend, upon the same terms and conditions, to each person, if any, who controls any Underwriter within the meaning of the Act or the Exchange Act; and the obligations of the Underwriters under this Section 6 shall be in addition to any liability which the respective Underwriters may otherwise have and shall extend, upon the same terms and conditions, to each director of the Company (including any person who, with his consent, is named in the Registration Statement as about to become a director of the Company), to each officer of the Company who has signed the Registration Statement and to each person, if any, who controls the Company within the meaning of the Act or the Exchange Act. 7. Representations and Agreements to Survive Delivery. All representations, warranties, and agreements of the Company herein or in certificates delivered pursuant hereto, and the agreements of the several Underwriters contained in Section 6 hereof, shall remain operative and in full force and effect regardless of any investigation made by or on behalf of any Underwriter or any controlling persons, or the Company or any of its officers, directors or any controlling persons, and shall survive delivery of and payment for the Securities, and Warrants, if any. 8. Substitution of Underwriters. (a) If any Underwriter or Underwriters shall fail to take up and pay for the principal amount of Securities, and Warrants, if any, agreed by such Underwriter or Underwriters to be purchased hereunder, upon tender of such Securities, and Warrants, if any, in accordance with the terms hereof, and the principal amount of Securities, and Warrants, if any, not purchased does not aggregate more than 10% of the total principal amount of Securities, and Warrants, if any, set forth in Schedule B hereto, the remaining Underwriters shall be obligated to take up and pay for (in proportion to their respective underwriting obligations hereunder as set forth in Schedule B, except as may otherwise be determined by you) the Securities, and the Warrants, if any, which the withdrawing or defaulting Underwriter or Underwriters agreed but failed to purchase. (b) If any Underwriter or Underwriters shall fail to take up and pay for the principal amount of Securities, and Warrants, if any, agreed by such Underwriter or Underwriters to be purchased hereunder, upon tender of such Securities, and Warrants, if any, in accordance with the terms hereof, and the principal amount of Securities, and Warrants, if any, not purchased aggregates more than 10% of the total principal amount of Securities, and Warrants, if any, set forth in Schedule B hereto, and arrangements satisfactory to you and the Company for the purchase of such Securities, and Warrants, if any, by other persons are not made within 36 hours thereafter, this Agreement shall terminate. In the event of a default by any Underwriter as set forth in this Section 8, the Closing Date shall be postponed for such period, not to exceed seven full business days, as you shall determine in order that the required changes in the Registration Statement and the Prospectus or in any other documents or arrangements may be effected. In the event of any such termination, the Company shall not be under any liability to any Underwriter (except to the extent provided in Section 4(h) and Section 6) nor shall any Underwriter (other than an Underwriter who shall have failed, otherwise than for some reason permitted under this Agreement, to purchase the principal amount of Securities, and Warrants, if any, agreed by such Underwriter to be purchased under this Agreement) be under any liability to the Company (except to the extent provided in Section 6 hereof). Nothing contained in this Agreement shall relieve any defaulting Underwriter of its liability, if any, to the Company and any non-defaulting Underwriter for damages occasioned by its default hereunder. 9. Termination. You shall have the right to terminate this Agreement by giving notice as hereinafter specified at any time at or prior to the Closing Date if (i) trading generally on the New York Stock Exchange, 14 15 the American Stock Exchange or the NASDAQ National Market shall have been suspended or materially limited, (ii) trading in the Company's securities on the New York Stock Exchange has been suspended or materially limited, (iii) a banking moratorium shall have been declared by Federal or New York authorities, or (iv) there shall have occurred since the execution of this Agreement an outbreak or material escalation of major hostilities in which the United States is involved, a declaration of war by Congress or other calamity or crisis and, in the case of any such event specified in clauses (i) through (iv) above, the effect of such event, in your reasonable judgment, makes it impractical or inadvisable to proceed with the completion of the sale of and payment for the Securities, and the Warrants, if any, on the terms and in the manner contemplated in the Prospectus. Any such termination shall be without liability of any party to any other party except that the provisions of Section 4(h) and Section 6 shall at all times be effective. If you elect to terminate this Agreement as provided in this Section, the Company shall be notified promptly by you by telephone or telegram, confirmed by letter. 10. Notices. All notices or communications hereunder shall be in writing and if sent to you shall be mailed, delivered or telegraphed and confirmed to you at your address set forth for that purpose in Schedule A hereto, or if sent to the Company, shall be mailed, delivered or sent by facsimile transmission and confirmed to the Company at 250 East Carpenter Freeway, Irving, Texas 75062-2729. Notices to any Underwriter pursuant to Section 6 hereof shall be mailed, delivered or sent by facsimile transmission and confirmed to such Underwriter's address furnished to the Company in writing for the purpose of communications hereunder. Any party to this Agreement may change such address for notices by sending to the parties to this Agreement written notice of a new address for such purpose. 11. Parties. This Agreement shall inure to the benefit of and be binding upon the Company and the Underwriters and their respective successors and the controlling persons, officers and directors referred to in Section 6 and no other person will have any right or obligation hereunder. In all dealings with the Company under this Agreement, you shall act on behalf of each of the several Underwriters, and any action under this Agreement taken by you or by any one of you designated in Schedule A hereto will be binding upon all the Underwriters. 12. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. 15 16 13. Counterparts. This Agreement may be executed by one or more of you in one or more counterparts, each of which shall constitute an original and all of which taken together shall constitute one and the same Agreement. If the foregoing correctly sets forth our agreement, please so indicate in the space provided below for that purpose, whereupon this letter shall constitute a binding agreement between the Company and the several Underwriters. Alternatively, the execution of this Agreement by the Company and its acceptance by or on behalf of the Underwriters may be evidenced by an exchange of telegraphic or other written communications. Very truly yours, ASSOCIATES FIRST CAPITAL CORPORATION By: ------------------------------------- Title: Senior Vice President ACCEPTED at New York, New York as of the date first above written on behalf of ourselves and as Representatives of the other Underwriters, if any, named in Schedule B hereto. - ---------------------------------- By: ------------------------------ Title: 16 17 EXHIBIT I ASSOCIATES FIRST CAPITAL CORPORATION ------------------------------------ {Insert specific title of securities*} DELAYED DELIVERY CONTRACT * ---------------------------------- {Insert date of initial public offering} ASSOCIATES FIRST CAPITAL CORPORATION c/o* Ladies and Gentlemen: The undersigned hereby agrees to purchase from Associates First Capital Corporation (hereinafter called the "Company"), and the Company agrees to sell to the undersigned, {If one delayed closing, insert -- as of the date hereof, for delivery on , 19 (the "Delivery Date")} {$} principal amount of the Company's {title of Securities and related Warrants, if any} (the "Securities"), offered by the Company's Prospectus relating thereto, receipt of a copy of which is hereby acknowledged, at a purchase price of % of the principal amount thereof plus accrued interest, if any, and on the further terms and conditions set forth in this contract. {If two or more delayed closings, insert the following: The undersigned will purchase from the Company as of the date hereof, for delivery on the dates set forth below, Securities in the principal amounts set forth below: Delivery Date Principal Amount Each of such delivery dates is hereinafter referred to as a "Delivery Date".} Payment for the Securities which the undersigned has agreed to purchase for delivery on {the} {each} Delivery Date shall be made to the Company or its order by certified or official bank check in New York Clearing House funds at the office of at .M., time, on such Delivery Date upon delivery to the undersigned of the Securities to be purchased by the undersigned for delivery on such Delivery Date in definitive form and in such denominations and registered in such names as the undersigned may designate by written or telegraphic communication addressed to the Company not less than five full business days prior to such Delivery Date. If no designation is received, the Securities will be registered in the name of the undersigned and issued in a denomination equal to the aggregate principal amount of Securities to be purchased by the undersigned on such Delivery Date. - ---------- * To be completed when the Underwriting Agreement is executed by the parties thereto. 18 The obligation of the undersigned to take delivery of and make payment for, Securities on {the} {each} Delivery Date shall be subject only to the conditions that (1) investment in the Securities shall not at such Delivery Date be prohibited under the laws of any jurisdiction in the United States to which the undersigned is subject, which investment the undersigned represents is not prohibited on the date hereof, and (2) the Company shall have delivered to the Underwriters the principal amount of the Securities to be purchased by them pursuant to the Underwriting Agreement referred to in the Prospectus mentioned above and received payment therefor. Promptly after completion of the sale to the Underwriters the Company will mail or deliver to the undersigned at its address set forth below notice to such effect, accompanied by a copy of the opinion of counsel for the Company delivered to the Underwriters in connection therewith. This contract will inure to the benefit of and be binding upon the parties hereto and their respective successors, but will not be assignable by either party hereto without the written consent of the other. It is understood that the acceptance of this contract and any other similar contracts is in the Company's sole discretion and, without limiting the foregoing, need not be on a first-come, first-serve basis. If this contract is acceptable to the Company, it is requested that the Company sign the form of acceptance below and mail or deliver one of the counterparts hereof to the undersigned at its address set forth below. This will become a binding contract between the Company and the undersigned when such counterpart is mailed or delivered. This contract shall be governed by, and construed in accordance with, the laws of the State of New York. Very truly yours, ----------------------------------------- (Name of Purchaser) By -------------------------------------- ----------------------------------------- (Title of Signatory) ----------------------------------------- ----------------------------------------- (Address of Purchaser) Accepted, as of the above date. ASSOCIATES FIRST CAPITAL CORPORATION By ------------------------------- Vice President 19 SCHEDULE A Underwriting Agreement dated: Registration Statement No.: Representatives: Title of Securities: Indenture: Indenture dated as of June 1, 1998, with The Chase Manhattan Bank, as Trustee Amount of Securities: Price to Public: Purchase Price: ________% plus accrued interest, if any, from ________, 199__, payable by wire transfer in immediately available funds Final Maturity: Redemption: Repayment at Option of Holder: Conversion: Date Designated pursuant to Section 4(j)(ii): Other Terms: Title of Warrant Securities: Amount of Warrant Securities: Title of Warrant Agreement: Warrant Agent: Number of Warrants: per each $ principal amount of Warrant Securities] CONVERTED SECURITIES: Title of Converted Securities: Amount of Converted Securities: Voting Rights: Dividends: Redemption Sinking Fund: Liquidation Preference: Other Terms: Market of Exchange: Date Designated Pursuant to Section 4(j)(ii): Delayed Delivery: 20 Fee: Minimum principal amount of each Contract: Maximum aggregate principal amount of all Contracts: Closing: Office for delivery of Securities, and Warrants, if any: Office for payment for Securities, and Warrants, if any: LeBoeuf, Lamb, Greene & MacRae, L.L.P. Date and time of Closing: at 10:00 A.M. Office for checking Securities, and Warrants, if any: The Chase Manhattan Bank Address for notices per Section 10: Name of Underwriter to act per Section 11: 21 SCHEDULE B
Principal Amount of Securities (with Warrants, if any) UNDERWRITER to be purchased ------------------------------ ............................. $ ------------------- $ ===================
EX-1.2 3 FORM OF UNDERWRITING AGREEMENT (EQUITY) 1 EXHIBIT 1.2 ASSOCIATES FIRST CAPITAL CORPORATION EQUITY SECURITIES UNDERWRITING AGREEMENT ________, 19__ To the Representative or Representatives named in Schedule A hereto of the Underwriters named in Schedule B hereto Gentlemen: The undersigned Associates First Capital Corporation, a Delaware corporation (the "Company"), confirms its agreement with the several underwriters named in Schedule B hereto (the "Underwriters"), as set forth below. If the firm or firms listed in Schedule B hereto include only the firm or firms listed in Schedule A hereto (the "Representatives"), then the terms "Underwriters" and "Representatives", as used herein, shall each be deemed to refer to such firm or firms. 1. Description of Securities. The Company proposes to issue and sell preferred stock or common stock of the title and amount set forth in Schedule A hereto (the "Registered Securities"). Preferred stock will be issued in one or more series, which series may vary as to voting rights, dividends, redemption provisions, liquidation preferences, conversion provisions and other terms, with all such terms for any particular series or issue of preferred stock being determined at the time of sale. If so indicated in Schedule A hereto, the Company also proposes to issue certain securities into which the Securities or Warrant Securities may convert upon such terms and conditions set forth in Schedule A hereto (the "Converted Securities"). If so indicated in Schedule A hereto, the Company also proposes to issue warrants (the "Warrants") to purchase the aggregate number of shares of common stock, if any, listed in Schedule A hereto (the "Warrant Securities"). The Warrants, if any, are to be issued pursuant to the provisions of the Warrant Agreement listed in Schedule A hereto (the "Warrant Agreement") between the Company and the Warrant Agent named in Schedule A hereto (the "Warrant Agent"). If so indicated in Schedule A hereto, the Company has granted the Underwriters the option to purchase up to the amount of Registered Securities, if any, specified in Schedule A hereto (the "Option Securities" and, together with the Registered Securities, the "Securities"). 2. Representations and Warranties of the Company. The Company represents and warrants to, and agrees with, each Underwriter that: (a) A registration statement on Form S-3 (with the file numbers set forth in Schedule A hereto), including a prospectus, relating to the Securities, the Warrants, the Warrant Securities and the Converted Securities has been carefully prepared by the Company in conformity with the requirements of the Securities Act of 1933, as amended (the "Act"), the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"), and the rules and regulations (the "Rules and Regulations") of the Securities and Exchange Commission (the "Commission") thereunder, has been filed with the Commission and has become effective. Such registration statement and prospectus may have been amended or supplemented from time to time prior to the date of this Agreement; any such amendment or supplement was so prepared and filed and any such amendment has become effective. A prospectus supplement (the "Prospectus Supplement") relating to the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, has been so prepared and 2 will be filed pursuant to Rule 424 under the Act. Copies of such registration statement and prospectus, any such amendment or supplement, the Prospectus Supplement and all documents incorporated by reference therein which were filed with the Commission on or prior to the date of this Agreement (including one fully executed copy of the registration statement and of each amendment thereto for each of you and for counsel for the Underwriters) have been delivered to you. Such registration statement and prospectus, as amended or supplemented to the date of this Agreement and as supplemented by the Prospectus Supplement, are herein referred to as the "Registration Statement" and the "Prospectus". Any reference herein to the Registration Statement or Prospectus shall be deemed to refer to and include the documents incorporated by reference therein which were filed with the Commission on or prior to the date of this Agreement, and any reference to the terms "amend", "amendment" or "supplement" with respect to the Registration Statement or Prospectus shall be deemed to refer to and include the filing of any document with the Commission deemed to be incorporated by reference therein after the date of this Agreement. (b) When each part of the registration statement became effective such part conformed in all material respects to the requirements of the Act, the Trust Indenture Act and the Rules and Regulations and did not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; and on the date of this Agreement, upon the effectiveness of any amendment to the Registration Statement or the filing of any supplement to the Prospectus and at the Closing Date (as hereinafter defined), the Registration Statement and Prospectus and any amendment or supplement thereto will conform in all material respects to the requirements of the Act, the Trust Indenture Act and the Rules and Regulations and will not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; except that the foregoing shall not apply to statements in or omissions from any such document made in reliance upon, and in conformity with, written information furnished to the Company by you, or by any Underwriter through you, specifically for use in the preparation thereof. (c) The documents incorporated by reference in the Registration Statement or Prospectus, when they became effective or were filed with the Commission, as the case may be, under the Securities Exchange Act of 1934 (the "Exchange Act"), conformed, and any documents so filed and incorporated by reference after the date of this Agreement will, when they are filed with the Commission, conform, in all material respects to the requirements of the Act and the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder. (d) The financial statements of the Company and its subsidiaries included in the Registration Statement and Prospectus fairly present the financial condition of the Company and its subsidiaries as of the dates indicated and the results of operations and changes in financial position for the periods therein specified in conformity with generally accepted accounting principles consistently applied throughout the periods involved (except as otherwise stated therein). Coopers & Lybrand LLP, which has examined certain of such financial statements, as set forth in their report included in the Registration Statement and Prospectus, are independent public accountants with respect to the Company and its subsidiaries as required by the Act and the Rules and Regulations. (e) The Company has been duly incorporated and is an existing corporation in good standing under the laws of its jurisdiction of incorporation; the Company's subsidiaries have been duly incorporated and are existing corporations in good standing under the laws of their respective 2 3 jurisdictions of incorporation; each of the Company and its subsidiaries has full power and authority (corporate and other) to conduct its business as described in the Registration Statement and Prospectus; each of the Company and its subsidiaries is duly qualified to do business in each jurisdiction in which it owns or leases real property or in which the conduct of its business requires such qualification, except to the extent that the failure to so qualify would not have a material adverse effect on the financial condition or results of operations of the Company and its subsidiaries taken as a whole; and all of the outstanding shares of capital stock of each such subsidiary have been duly authorized and validly issued, are fully paid and non-assessable and the Company owns all outstanding shares of capital stock of each significant subsidiary (as defined in Rule 405 under the Act) (except as otherwise stated in the Registration Statement) in each such case subject to no security interest, other encumbrance or adverse claim. (f) The Warrant Agreement, if any, the Securities, the Warrants, if any, and the Warrant Securities, if any, have been duly authorized, and the Warrant Agreement, if any, constitutes, and the Securities, the Warrants, if any, and the Warrant Securities, if any, when duly executed, issued and delivered as contemplated hereby, by the Delayed Delivery Contracts (as hereinafter defined), if any, and by the Warrant Agreement, if any, will constitute valid and legally binding obligations of the Company in accordance with their terms subject, as to enforcement, to bankruptcy, insolvency, reorganization and other laws of general applicability relating to or affecting creditors' rights and to general equity principles; the Warrant Securities, if any, have been duly reserved for issuance upon the exercise of the Warrants, if any, and, when issued, will be duly and validly issued, fully-paid and non-assessable; the common stock, if any, and the preferred stock, if any, described herein, when issued, will be duly and validly issued, fully-paid and non-assessable and will not be subject to any preemptive or similar rights; and, if the Converted Securities, if any, are shares of the capital stock of the Company, such shares of Converted Securities have been duly authorized by the Company, have been duly reserved for issuance upon conversion of the Securities and, when issued upon conversion of the Securities, will be duly and validly issued, fully paid and non-assessable and will not be subject to any preemptive or similar rights. (g) Except as contemplated in the Prospectus, subsequent to the respective dates as of which information is given in the Registration Statement and the Prospectus, neither the Company nor any of its subsidiaries has incurred any liabilities or obligations, direct or contingent, or entered into any transactions, not in the ordinary course of business, which are material to the Company and its subsidiaries, taken as a whole, and there has not been any material adverse change, on a consolidated basis, in the capital stock, short-term debt or long-term debt of the Company and its subsidiaries, or any material adverse change, or any development involving a prospective material adverse change, in the condition (financial or other), business, prospects, net worth or results of operations of the Company and its subsidiaries taken as a whole. (h) Except as set forth in the Prospectus, there is not pending or, to the knowledge of the Company, threatened, any action, suit or proceeding to which the Company or any of its subsidiaries is a party before or by any court or governmental agency or body, in which there is a reasonable possibility of an adverse decision which could result in any material adverse change in the condition (financial or other), business, prospects, net worth or results of operations of the Company and its subsidiaries, taken as a whole, or might materially and adversely affect the properties or assets thereof; and there are no contracts or documents of the Company or any of its subsidiaries which are 3 4 required to be filed as exhibits to the Registration Statement by the Act or by the Rules and Regulations which have not been so filed or which will not be so filed prior to the date of any Prospectus Supplement. (i) The Company and its subsidiaries hold good and marketable title in fee simple, except as otherwise stated in the Prospectus, to all of the real property referred to therein as being owned by them, free and clear of all liens and encumbrances, except liens and encumbrances referred to in the Prospectus (or reflected in the financial statements included therein) and liens and encumbrances which are not material in the aggregate and do not materially interfere with the conduct of the business of the Company and its subsidiaries taken as a whole; and the properties referred to in the Prospectus as held under lease by the Company or any of its subsidiaries are held by them under valid and enforceable leases with such exceptions as do not materially interfere with the conduct of the business of the Company and its subsidiaries taken as a whole. (j) This Agreement has been duly authorized, executed and delivered; the performance of this Agreement and of any Delayed Delivery Contracts and the consummation of the transactions herein contemplated (including, without limitation, the issuance of the Securities and the Warrant Securities, if any, upon the exercise of the Warrants, if any) will not result in a breach or violation of any of the terms and provisions of, or constitute a default under, any statute, any agreement or instrument to which the Company or any of its subsidiaries is a party or by which any of them is bound or to which any of the property of the Company or any of its subsidiaries is subject, the Company's charter or by-laws, or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Company or any of its properties; no consent, approval, authorization or order of, or filing with, any court or governmental agency or body is required for the consummation of the transactions contemplated by this Agreement and any Delayed Delivery Contracts in connection with the issuance or sale of the Securities, the Warrants, if any, the Warrant Securities, if any, or the Converted Securities, if any, by the Company, except such as may be required under the Act or state securities laws; and the Company has full power and authority to authorize, issue and sell the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, as contemplated by this Agreement. (k) Upon issuance, the common stock, if any, of the Company described herein will be listed on the New York Stock Exchange. 3. Purchase, Sale and Delivery of Securities. On the basis of the representations, warranties and agreements herein contained, but subject to the terms and conditions herein set forth, the Company agrees to issue and sell to each Underwriter, and each Underwriter agrees, severally and not jointly, to purchase from the Company, at the purchase price set forth in Schedule A hereto, the amount of Registered Securities, and the amount of Warrants, if any, set forth opposite the name of such Underwriter in Schedule B hereto reduced by such Underwriter's portion of any Contract Securities, determined as provided below. If so specified in Schedule A hereto, on the basis of the representations, warranties and covenants contained herein, but subject to the terms and conditions herein set forth, the Company grants an option to the several Underwriters to purchase, severally and not jointly, up to that amount of the Option Securities as is specified in Schedule A hereto from the Company at the same price as the Underwriters shall pay for the Registered Securities. Said option may be exercised only to cover over-allotments in the sale of the Registered Securities by the Underwriters and may be exercised in whole or in part at any time on or before 4 5 the thirtieth day after the date hereof upon written or facsimile notice by the Representatives to the Company setting forth the amount of the Option Securities as to which the several Underwriters are exercising the option. The amount of Option Securities to be purchased by each Underwriter shall be the same percentage of the total amount of the Option Securities to be purchased by the several Underwriters as such Underwriter is purchasing of the Registered Securities, as adjusted by the Representatives in such manner as the Representatives deem advisable to avoid fractional shares/units. If so authorized in Schedule A hereto, the Underwriters may solicit offers from investors of the types set forth in the Prospectus to purchase Securities, and Warrants, if any, from the Company pursuant to delayed delivery contracts ("Delayed Delivery Contracts"). Such contracts shall be substantially in the form of Exhibit I hereto but with such changes therein as the Company may approve. Securities and Warrants, if any, to be purchased pursuant to Delayed Delivery Contracts are herein called "Contract Securities". When Delayed Delivery Contracts are authorized in Schedule A, the Company will enter into a Delayed Delivery Contract in each case where a sale of Contract Securities arranged through you has been approved by the Company but, except as the Company may otherwise agree, such Delayed Delivery Contracts must be for at least the minimum amount of Contract Securities set forth in Schedule A hereto, and the aggregate amount of Contract Securities may not exceed the amount set forth in such Schedule. The Company will advise you not later than 10:00 A.M., New York City time, on the third full business day preceding the Closing Date (or at such later time as you may otherwise agree) of the sales of the Contract Securities which have been so approved. You and the other Underwriters will not have any responsibility in respect of the validity or performance of Delayed Delivery Contracts. The amount of Securities, and Warrants, if any, to be purchased by each Underwriter as set forth in Schedule B hereto shall be reduced by an amount which shall bear the same proportion to the total amount of Contract Securities as the amount of Securities, and Warrants, if any, set forth opposite the name of such Underwriter bears to the total amount of Securities, and Warrants, if any, set forth in Schedule B hereto, except to the extent that you determine that such reduction shall be otherwise than in such proportion and so advise the Company; provided, however, that the total amount of Securities, and Warrants, if any, to be purchased by all Underwriters shall be the total amount of Securities, and Warrants, if any, set forth in Schedule B hereto less the aggregate amount of Contract Securities. The Securities, and the Warrants, if any, to be purchased by the Underwriters will be delivered by the Company to you for the accounts of the several Underwriters at the office specified in Schedule A hereto against payment of the purchase price therefor by wire or interbank transfer of immediately available funds to an account specified by the Company (or, if so specified in Schedule A hereto, by certified or official bank check or checks in immediately available funds payable to the order of the Company at the office specified in Schedule A hereto) on the date and at the time specified in such Schedule A, or at such other time not later than eight full business days thereafter as you and the Company determine, such time being herein referred to as the "Closing Date". Schedule A may specify a Closing Date for any Option Securities to be different than the Closing Date for the Registered Securities, in which case references herein to "Closing Date" shall refer to each such date as the context requires. Such Securities, and Warrants, if any, will be prepared in definitive form and in such authorized denominations and registered in such names as you may require upon at least two business days' prior notice to the Company and will be made available for checking and packaging at the office at which they are to be delivered on the Closing Date (or such other office as may be specified for that purpose in Schedule A) at least one business day prior to the Closing Date. It is understood that you, acting individually and not in a representative capacity, may (but shall not 5 6 be obligated to) make payment to the Company on behalf of any other Underwriter for Securities, and Warrants, if any, to be purchased by such Underwriter. Any such payment by you shall not relieve any such Underwriter of any of its obligations hereunder. The Company will pay to you on the Closing Date for the accounts of the Underwriters any fee, commission or other compensation which is specified in Schedule A hereto. Such payment will be made by wire or interbank transfer of immediately available funds to an account that you specify (or, if so specified in Schedule A hereto, by certified or official bank check or checks in New York Clearing House funds to your order at the office specified in Schedule A hereto). 4. Covenants. The Company covenants and agrees with each Underwriter that: (a) The Company will cause the Prospectus Supplement to be filed pursuant to Rule 424 under the Act and will notify you promptly of such filing. During the period in which a prospectus relating to the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, is required to be delivered under the Act, the Company will notify you promptly of the time when any amendment to the Registration Statement has become effective or any subsequent supplement to the Prospectus has been filed and of any request by the Commission for any amendment of or supplement to the Registration Statement or Prospectus or for additional information; it will prepare and file with the Commission, promptly upon your request, any amendments or supplements to the Registration Statement or Prospectus which, in your opinion, may be necessary or advisable in connection with the distribution of the Securities, and the Warrants, if any, by the Underwriters; it will file no amendment or supplement to the Registration Statement or Prospectus (other than any prospectus supplement relating to the offering of securities other than the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, registered under the Registration Statement or any document required to be filed under the Exchange Act which upon filing is deemed to be incorporated by reference therein) to which you shall reasonably object by notice to the Company after having been furnished a copy a reasonable time prior to the filing; and it will furnish to you a reasonable time prior to the filing thereof a copy of any such prospectus supplement or any document which upon filing is deemed to be incorporated by reference in the Registration Statement or Prospectus. (b) The Company will advise you, promptly after it shall receive notice or obtain knowledge thereof, of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement, of the suspension of the qualification of the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, for offering or sale in any jurisdiction, or of the initiation or threatening of any proceeding for any such purpose; and it will promptly use its best efforts to prevent the issuance of any stop order or to obtain its withdrawal if such a stop order should be issued. (c) Within the time during which a prospectus relating to the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, is required to be delivered under the Act, the Company will comply as far as it is able with all requirements imposed upon it by the Act, as now and hereafter amended, and by the Rules and Regulations, as from time to time in force, so far as necessary to permit the continuance of sales of or dealings in the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, as contemplated by the provisions hereof and the Prospectus. If during such period any event occurs as a result of which 6 7 the Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances then existing, not misleading, or if during such period it is necessary to amend or supplement the Registration Statement or Prospectus to comply with the Act, the Company will promptly notify you in writing and will amend or supplement the Registration Statement or Prospectus (at the expense of the Company) so as to correct such statement or omission or effect such compliance. (d) The Company will use its best efforts to qualify the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, for sale under the securities laws of such jurisdictions as you reasonably designate and to continue such qualifications in effect so long as required for the distribution of the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, except that the Company shall not be required in connection therewith to qualify as a foreign corporation or to execute a general consent to service of process in any state. The Company will also arrange for the determination of the eligibility for investment for the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, under the laws of such jurisdictions as you may reasonably request. (e) The Company will furnish to the Underwriters copies of the Registration Statement and Prospectus (including all documents incorporated by reference therein), and all amendments and supplements to the Registration Statement or Prospectus which are filed with the Commission during the period in which a prospectus relating to the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, is required to be delivered under the Act (including all documents filed with the Commission during such period which are deemed to be incorporated by reference therein), in each case in such quantities as you may from time to time reasonably request. (f) So long as any of the Securities, the Warrant Securities, if any, and the Converted Securities, if any, are outstanding, the Company agrees to furnish to you as soon as available, copies of all financial reports to the Company's security holders generally (other than Associates First Capital Corporation or other affiliated corporations) and all reports and financial statements filed by or on behalf of the Company with the Commission and the New York Stock Exchange. (g) The Company will make generally available to its security holders as soon as practicable, but in any event not later than 15 months after the end of the Company's current fiscal quarter, an earnings statement (which need not be audited) covering a 12-month period beginning after the date upon which the Prospectus Supplement is filed pursuant to Rule 424 under the Act which shall satisfy the provisions of Section 11(a) of the Act. (h) The Company, whether or not the transactions contemplated hereunder are consummated or this Agreement is terminated, will pay all expenses incident to the performance of its obligations hereunder, will pay the expenses of printing all documents relating to the offering, and will reimburse the Underwriters for any expenses (including fees and disbursements of counsel) incurred by them in connection with the matters referred to in Section 4(d) hereof and the preparation of memoranda relating thereto, for any filing fee of the National Association of Securities Dealers, Inc. relating to the Securities, the Warrants, if any, and the Warrant Securities, if any, and for any fees charged by investment rating agencies for rating the Securities, and the Warrant Securities, if any. 7 8 If the sale of the Securities, and the Warrants, if any, provided for in this Agreement is not consummated by reason of any failure, refusal or inability on the part of the Company to perform any agreement on its part to be performed, or because any other condition of the Underwriters' obligations hereunder required to be fulfilled by the Company is not fulfilled, the Company will reimburse the Underwriters for all reasonable out-of-pocket disbursements (including fees and disbursements of counsel) incurred by the Underwriters in connection with their preparing to market and marketing the Securities, and the Warrants, if any, or in contemplation of performing their obligations hereunder. The Company shall not in any event be liable to any of the Underwriters for loss of anticipated profits from the transactions covered by this Agreement. (i) The Company will apply the net proceeds of the sale of the Securities, the Warrants, if any, and the Warrant Securities, if any, as set forth in the Prospectus. (j) The Company will not, without your consent, (i) offer for sale, sell or otherwise dispose of, directly or indirectly, any shares of the common stock of the Company or permit the registration under the Securities Act of any shares of the common stock of the Company (other than the Securities and shares issued pursuant to employee benefit plans, qualified stock option plans or other employee compensation plans), (ii) sell or grant options, rights or warrants with respect to any shares of the common stock of the Company (other than the Securities and the grant of options pursuant to employee benefit plans), or (iii) offer for sale, sell or otherwise dispose of, directly or indirectly, any securities convertible into or, exchangeable or exercisable for shares of the common stock of the Company (other than the Securities), in each case until after the date specified in Schedule A hereto; provided, however, that the Company may, without such consent, offer and sell shares of the common stock of the Company in transactions exempt from the registration requirements of the Securities Act, provided that the purchasers in such transactions are prohibited from offering for sale, selling or otherwise disposing of, directly or indirectly, any of the shares of the common stock of the Company so acquired by them until after the date specified in Schedule A hereto. 5. Conditions of the Underwriters' Obligations. The obligations of the Underwriters to purchase and pay for the Securities, and the Warrants, if any, as provided herein shall be subject to the accuracy, as of the date hereof and the Closing Date (as if made at the Closing Date), of the representations and warranties of the Company herein, to the performance by the Company of its obligations hereunder and to the following additional conditions: (a) No stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceeding for that purpose shall have been instituted or, to the knowledge of the Company or any Underwriter, threatened by the Commission, and any request of the Commission for additional information (to be included in the Registration Statement or the Prospectus or otherwise) shall have been complied with to your reasonable satisfaction. (b) No Underwriter shall have advised the Company that the Registration Statement or Prospectus, or any amendment or supplement thereto, contains an untrue statement of fact which in your opinion is material, or omits to state a fact which in your opinion is material and is required to be stated therein or is necessary to make the statements therein not misleading. (c) Except as contemplated in the Prospectus, subsequent to the respective dates as of which information is given in the Registration Statement and the Prospectus, there shall not have been any 8 9 material adverse change, on a consolidated basis, in the capital stock, short-term debt or long-term debt of the Company and its subsidiaries, or any material adverse change, or any development involving a prospective material adverse change in the condition (financial or other), business, net worth or results of operations of the Company and its subsidiaries, taken as a whole, or a downgrade in the rating assigned to any securities of the Company, which, in any such case, is, in your reasonable judgment, so material and adverse as to make it impracticable or inadvisable to proceed with the completion of the sale of and payment for the Securities, and the Warrants, if any, on the terms and in the manner contemplated in the Prospectus. (d) You shall have received the opinion of the General Counsel or an Assistant General Counsel to the Company, dated the Closing Date and any later date, if any, on which Option Securities are purchased, to the effect that: (i) The Company has been duly incorporated and is an existing corporation in good standing under the laws of its jurisdiction of incorporation; the Company's subsidiaries have been duly incorporated and are existing corporations in good standing under the laws of their respective jurisdictions of incorporation; each of the Company and its subsidiaries has full power and authority (corporate and other) to conduct its business as described in the Registration Statement and Prospectus; and each of the Company and its subsidiaries is duly qualified to do business in each jurisdiction in which it owns or leases real property or in which the conduct of its business requires such qualification, except to the extent that the failure to so qualify would not have a material adverse effect on the financial condition or results of operations of the Company and its subsidiaries taken as a whole; and all of the outstanding shares of capital stock of each of the Company's subsidiaries have been duly authorized and validly issued, are fully paid and non-assessable and the Company owns all outstanding shares of capital stock of each significant subsidiary (as defined in Rule 405 under the Act) (except as otherwise stated in the Registration Statement) in each such case subject to no security interest, other encumbrance, or adverse claim; (ii) The Warrant Agreement, if any, the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any, have been duly authorized, and the Warrant Agreement, if any, constitutes, and the Securities, the Warrants, if any, and the Warrant Securities, if any, when duly executed, issued and delivered as contemplated hereby, by the Delayed Delivery Contracts (as hereinafter defined), if any, and by the Warrant Agreement, if any, will constitute valid and legally binding obligations of the Company in accordance with their terms subject, as to enforcement, to bankruptcy, insolvency, reorganization and other laws of general applicability relating to or affecting creditors' rights and to general equity principles; the Warrant Securities, if any, have been duly reserved for issuance upon the exercise of the Warrants, if any, and, when issued, will be duly and validly issued, fully-paid and non-assessable; the common stock, if any, and the preferred stock, if any, described in the Agreement, when issued, will be duly and validly issued, fully-paid and non-assessable and will not be subject to any preemptive or similar rights; if the Converted Securities, if any, are shares of capital stock of the Company, such shares of Converted Securities have been duly authorized by the Company, have been duly reserved for issuance upon conversion of the Securities and, when issued upon conversion of the Securities, will be duly and validly issued, fully paid and non-assessable and will not be subject to any preemptive or similar rights; and the Securities, the Warrants, if any, the 9 10 Warrant Securities, if any, and the Converted Securities, if any, conform to the description thereof in the Prospectus; (iii) The Registration Statement has become effective under the Act and, to the best knowledge of such counsel, no stop order suspending the effectiveness of the Registration Statement has been issued and no proceeding for that purpose has been instituted or, to the knowledge of such counsel, threatened by the Commission; (iv) Each part of the registration statement, when such part became effective, and the Registration Statement and the Prospectus, and any amendment or supplement thereto, complied as to form in all material respects with the requirements of the Act, the Trust Indenture Act and the Rules and Regulations; such counsel has no reason to believe that either any part of the registration statement when such part became effective, or the Registration Statement and the Prospectus or any amendment or supplement thereto contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading; and the documents incorporated by reference in the Registration Statement or Prospectus, when they became effective under the Act or were filed with the Commission under the Exchange Act, as the case may be, complied as to form in all material respects with the requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder; it being understood that such counsel need express no opinion as to the financial statements or other financial data included in any of the documents mentioned in this clause; (v) The descriptions in the Registration Statement and Prospectus of statutes, legal and governmental proceedings, contracts and other documents are accurate and fairly present the information required to be shown; and such counsel does not know of any statutes or legal or governmental proceedings required to be described in the Prospectus which are not described as required, or of any contracts or documents of a character required to be described in the Registration Statement or Prospectus (or then required to be filed under the Exchange Act if upon such filing they would be incorporated by reference therein) or to be filed as exhibits to the Registration Statement which are not described and filed as required; and (vi) This Agreement and any Delayed Delivery Contracts have been duly authorized, executed and delivered by the Company; the performance thereof and the consummation of the transactions therein contemplated (including, without limitation, the issuance of the Warrant Securities, if any, upon the exercise of the Warrants, if any, or the issuance of the Converted Securities, if any, upon conversion of the Securities or Warrant Securities) will not result in a breach or violation of any of the terms and provisions of, or constitute a default under, any statute, any agreement or instrument known to such counsel to which the Company or any of its subsidiaries is a party or by which it is bound or to which any of the property of the Company or any of its subsidiaries is subject, the Company's charter or by-laws, or any order, rule or regulation known to such counsel of any court or governmental agency or body having jurisdiction over the Company or any of its properties; and no consent, approval, authorization or order of, or filing with, any court or governmental agency or body is required for the consummation of the transactions contemplated by this Agreement and any Delayed Delivery Contracts in connection with the issuance or sale of 10 11 the Securities (including the Contract Securities, if any), the Warrants, if any, or the Warrant Securities, if any, by the Company, except such as have been obtained under the Act and such as may be required under state securities laws in connection with the sale of the Securities, the Warrants, if any, the Warrant Securities, if any, and the Converted Securities, if any. (e) You shall have received from LeBoeuf, Lamb, Greene & MacRae, L.L.P., counsel for the Underwriters, such opinion or opinions, dated the Closing Date, with respect to the incorporation of the Company, the validity of the Securities, the Warrants, if any, the Warrant Securities, if any, the Converted Securities, if any, the Registration Statement, the Prospectus and other related matters as you reasonably may request, and such counsel shall have received such papers and information as they request to enable them to pass upon such matters. (f) You shall have received, on the Closing Date, a letter from Coopers & Lybrand LLP, dated the Closing Date, confirming that they are independent auditors with respect to the Company within the meaning of the Act and the applicable published rules and regulations thereunder, and stating, as of the date of such letter (or, with respect to matters involving changes or developments since the respective dates as of which specified financial information is given in the Registration Statement and Prospectus, as of a date not more than three business days prior to the date of such letter), the conclusions and findings of such firm with respect to the financial information and other matters concerning the Company covered by its draft letter reviewed by the Representatives prior to the execution of this Agreement, and affirming, in form and substance satisfactory to the Representatives and in all material respects, the conclusions and findings set forth in such draft letter. (g) You shall have received from the Company a certificate, signed by the Chairman of the Board, a Vice Chairman, the President or a Vice President, and by the principal financial or accounting officer, dated the Closing Date and on any later date, if any, on which Option Securities are purchased, to the effect that, to the best of their knowledge based upon reasonable investigation: (i) The representations and warranties of the Company in this Agreement are true and correct, as if made at and as of the Closing Date, and the Company has complied with all the agreements and satisfied all the conditions on its part to be performed or satisfied at or prior to the Closing Date; (ii) No stop order suspending the effectiveness of the Registration Statement has been issued, and no proceeding for that purpose has been instituted or is threatened by the Commission; and (iii) Since the date of this Agreement, there has occurred no event required to be set forth in an amendment or supplement to the Registration Statement or Prospectus which has not been so set forth, and there has been no document required to be filed under the Exchange Act and the rules and regulations thereunder that upon such filing would be deemed to be incorporated by reference in the Prospectus that has not been so filed. (h) The Company shall have furnished to you such further certificates and documents as you shall have reasonably requested. 11 12 All such opinions, certificates, letters and other documents will be in compliance with the provisions hereof only if they are in form and substance reasonably satisfactory to you. The Company will furnish you with such conformed copies of such opinions, certificates, letters and other documents as you shall reasonably request. 6. Indemnification and Contribution. (a) The Company will indemnify and hold harmless each Underwriter against any losses, claims, damages or liabilities, joint or several, to which such Underwriter may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any part of the registration statement when such part became effective, or in the Registration Statement, the Prospectus, or any amendment or supplement thereto, or any related preliminary prospectus supplement, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading; and will reimburse each Underwriter, as incurred, for any legal or other expenses reasonably incurred by it in connection with investigating or defending against such loss, claim, damage, liability or action; provided, however, that the Company shall not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made therein in reliance upon and in conformity with written information furnished to the Company by you, or by any Underwriter through you specifically for use in the preparation thereof and provided further that the Company shall not be liable to any Underwriter under the indemnity agreement in this subsection (a) with respect to any preliminary prospectus to the extent that any loss, claim, damage or liability of such Underwriter results from the fact that such Underwriter sold Securities or Warrants, if any, to a person as to whom it is established that there was not sent or given, at or prior to written confirmation of such sale, a copy of the Prospectus (excluding documents incorporated by reference) or of the Prospectus as then amended or supplemented (excluding documents incorporated by reference) in any case where such delivery is required by the Act if the Company notified you in writing in accordance with Section 4(c) hereof and previously furnished copies of the Prospectus (excluding documents incorporated by reference) or of the Prospectus as then amended or supplemented (excluding documents incorporated by reference) in the quantity requested in accordance with Section 4(e) hereof to such Underwriter and the loss, claim, damage or liability of such Underwriter results from an untrue statement or omission of a material fact contained in the preliminary prospectus and corrected in the Prospectus or the Prospectus as then amended or supplemented. (b) Each Underwriter will indemnify and hold harmless the Company against any losses, claims, damages or liabilities to which the Company may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any part of the registration statement when such part became effective, or in the Registration Statement, the Prospectus or any amendment or supplement thereto, or any related preliminary prospectus supplement, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made therein in reliance upon and in conformity with written information furnished to the Company by you, or by such Underwriter through you, specifically for use in the preparation thereof; and will reimburse the Company for any legal or other expenses reasonably incurred by the Company in connection with investigating or defending against any such loss, claim, damage, liability or action. 12 13 (c) Promptly after receipt by an indemnified party under subsection (a) or (b) above of notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under such subsection, notify the indemnifying party in writing of the commencement thereof; but the omission so to notify the indemnifying party shall not relieve it from any liability which it may have to any indemnified party otherwise than under such subsection. In case any such action shall be brought against any indemnified party, and it shall notify the indemnifying party of the commencement thereof, the indemnifying party shall be entitled to participate in, and, to the extent that it shall wish, jointly with any other indemnifying party, similarly notified, to assume the defense thereof, with counsel satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the indemnifying party), and after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof, the indemnifying party shall not be liable to such indemnified party under such subsection for any legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof other than reasonable costs of investigation. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatening proceeding in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding and does not include a statement as to, or an admission of, fault, culpability or a failure to act by or on behalf of any indemnified party. (d) If the indemnification provided for in this Section 6 is unavailable or insufficient to hold harmless an indemnified party under subsection (a) or (b) above, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of the losses, claims, damages or liabilities referred to in subsection (a) or (b) above, (i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters on the other from the offering of the Securities, and the Warrants, if any, or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company on the one hand and the Underwriters on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Underwriters on the other shall be deemed to be in the same proportion as the total net proceeds from the offering of the Securities (before deducting expenses) received by the Company bear to the total compensation or profit (before deducting expenses) received or realized by the Underwriters from the purchase and resale, or underwriting, of the Securities, and the Warrants, if any. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or the Underwriters and the parties' relative intent, knowledge, access to information and opportunity, and actions and inaction, to correct or prevent such untrue statement or omission. The Company and the Underwriters agree that it would not be just and equitable if contributions pursuant to this subsection (d) were to be determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to in the first sentence of this subsection (d). The amount paid by an indemnified party as a result of the losses, claims, damages or liabilities referred to in the first sentence of this subsection (d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any action or claim (which shall be limited as provided in subsection (c) above if the indemnifying party has assumed the defense of any such action in accordance with the provisions thereof) which is the subject of this subsection (d). 13 14 Notwithstanding the provisions of this subsection (d), no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Securities, and the Warrants, if any, underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Underwriters' obligations in this subsection (d) to contribute shall be several in proportion to their respective underwriting obligations and not joint. Promptly after receipt by an indemnified party under this subsection (d) of notice of the commencement of any action against such party in respect of which a claim for contribution may be made against an indemnifying party under this subsection (d), such indemnified party shall notify the indemnifying party in writing of the commencement thereof if the notice specified in subsection (c) above has not been given with respect to such action; but the omission so to notify the indemnifying party shall not relieve it from any liability which it may have to any indemnified party otherwise than under this subsection (d). (e) The obligations of the Company under this Section 6 shall be in addition to any liability which the Company may otherwise have and shall extend, upon the same terms and conditions, to each person, if any, who controls any Underwriter within the meaning of the Act or the Exchange Act; and the obligations of the Underwriters under this Section 6 shall be in addition to any liability which the respective Underwriters may otherwise have and shall extend, upon the same terms and conditions, to each director of the Company (including any person who, with his consent, is named in the Registration Statement as about to become a director of the Company), to each officer of the Company who has signed the Registration Statement and to each person, if any, who controls the Company within the meaning of the Act or the Exchange Act. 7. Representations and Agreements to Survive Delivery. All representations, warranties, and agreements of the Company herein or in certificates delivered pursuant hereto, and the agreements of the several Underwriters contained in Section 6 hereof, shall remain operative and in full force and effect regardless of any investigation made by or on behalf of any Underwriter or any controlling persons, or the Company or any of its officers, directors or any controlling persons, and shall survive delivery of and payment for the Securities, and the Warrants, if any. 8. Substitution of Underwriters. (a) If any Underwriter or Underwriters shall fail to take up and pay for the amount of Securities, and Warrants, if any, agreed by such Underwriter or Underwriters to be purchased hereunder, upon tender of such Securities, and Warrants, if any, in accordance with the terms hereof, and the amount of Securities, and Warrants, if any, not purchased does not aggregate more than 10% of the total amount of Securities, and Warrants, if any, set forth in Schedule B hereto, the remaining Underwriters shall be obligated to take up and pay for (in proportion to their respective underwriting obligations hereunder as set forth in Schedule B, except as may otherwise be determined by you) the Securities, and the Warrants, if any, which the withdrawing or defaulting Underwriter or Underwriters agreed but failed to purchase. (b) If any Underwriter or Underwriters shall fail to take up and pay for the amount of Securities, and Warrants, if any, agreed by such Underwriter or Underwriters to be purchased hereunder, upon tender of such Securities, and Warrants, if any, in accordance with the terms hereof, and the amount of Securities, and Warrants, if any, not purchased aggregates more than 10% of the total amount of Securities, and Warrants, if any, set forth in Schedule B hereto, and arrangements satisfactory to you and the Company for the 14 15 purchase of such Securities, and Warrants, if any, by other persons are not made within 36 hours thereafter, this Agreement shall terminate. In the event of a default by any Underwriter as set forth in this Section 8, the Closing Date shall be postponed for such period, not to exceed seven full business days, as you shall determine in order that the required changes in the Registration Statement and the Prospectus or in any other documents or arrangements may be effected. In the event of any such termination, the Company shall not be under any liability to any Underwriter (except to the extent provided in Section 4(h) and Section 6) nor shall any Underwriter (other than an Underwriter who shall have failed, otherwise than for some reason permitted under this Agreement, to purchase the amount of Securities, and Warrants, if any, agreed by such Underwriter to be purchased under this Agreement) be under any liability to the Company (except to the extent provided in Section 6 hereof). Nothing contained in this Agreement shall relieve any defaulting Underwriter of its liability, if any, to the Company and any non-defaulting Underwriter for damages occasioned by its default hereunder. 9. Termination. You shall have the right to terminate this Agreement by giving notice as hereinafter specified at any time at or prior to the Closing Date if (i) trading generally on the New York Stock Exchange, the American Stock Exchange or the NASDAQ National Market shall have been suspended or materially limited, (ii) trading in the Company's securities on the New York Stock Exchange has been suspended or materially limited, (iii) a banking moratorium shall have been declared by Federal or New York authorities, or (iv) there shall have occurred since the execution of this Agreement an outbreak or material escalation of major hostilities in which the United States is involved, a declaration of war by Congress or other calamity or crisis and, in the case of any such event specified in clauses (i) through (iv) above, the effect of such event, in your reasonable judgment, makes it impractical or inadvisable to proceed with the completion of the sale of and payment for the Securities, and the Warrants, if any, on the terms and in the manner contemplated in the Prospectus. Any such termination shall be without liability of any party to any other party except that the provisions of Section 4(h) and Section 6 shall at all times be effective. If you elect to terminate this Agreement as provided in this Section, the Company shall be notified promptly by you by telephone or telegram, confirmed by letter. 10. Notices. All notices or communications hereunder shall be in writing and if sent to you shall be mailed, delivered or telegraphed and confirmed to you at your address set forth for that purpose in Schedule A hereto, or if sent to the Company, shall be mailed, delivered or sent by facsimile transmission and confirmed to the Company at 250 East Carpenter Freeway, Irving, Texas 75062-2729. Notices to any Underwriter pursuant to Section 6 hereof shall be mailed, delivered or sent by facsimile transmission and confirmed to such Underwriter's address furnished to the Company in writing for the purpose of communications hereunder. Any party to this Agreement may change such address for notices by sending to the parties to this Agreement written notice of a new address for such purpose. 11. Parties. This Agreement shall inure to the benefit of and be binding upon the Company and the Underwriters and their respective successors and the controlling persons, officers and directors referred to in Section 6 and no other person will have any right or obligation hereunder. In all dealings with the Company under this Agreement, you shall act on behalf of each of the several Underwriters, and any action under this Agreement taken by you or by any one of you designated in Schedule A hereto will be binding upon all the Underwriters. 12. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. 15 16 13. Counterparts. This Agreement may be executed by one or more of you in one or more counterparts, each of which shall constitute an original and all of which taken together shall constitute one and the same Agreement. If the foregoing correctly sets forth our agreement, please so indicate in the space provided below for that purpose, whereupon this letter shall constitute a binding agreement between the Company and the several Underwriters. Alternatively, the execution of this Agreement by the Company and its acceptance by or on behalf of the Underwriters may be evidenced by an exchange of telegraphic or other written communications. Very truly yours, ASSOCIATES FIRST CAPITAL CORPORATION By: --------------------------------------------- Title: Senior Vice President ACCEPTED at New York, New York as of the date first above written on behalf of ourselves and as Representatives of the other Underwriters, if any, named in Schedule B hereto. - ------------------------- By: -------------------------------------------- Title: 16 17 EXHIBIT I ASSOCIATES FIRST CAPITAL CORPORATION ------------------------------------ {Insert specific title of securities*} DELAYED DELIVERY CONTRACT * -------------------- {Insert date of initial public offering} ASSOCIATES FIRST CAPITAL CORPORATION c/o* Ladies and Gentlemen: The undersigned hereby agrees to purchase from Associates First Capital Corporation (hereinafter called the "Company"), and the Company agrees to sell to the undersigned, {If one delayed closing, insert -- as of the date hereof, for delivery on , 19 (the "Delivery Date")} shares ---------- of the Company's {title of Securities and related Warrants, if any} (the "Securities"), offered by the Company's Prospectus relating thereto, receipt of a copy of which is hereby acknowledged, at a purchase price of ________ per share and on the further terms and conditions set forth in this contract. {If two or more delayed closings, insert the following: The undersigned will purchase from the Company as of the date hereof, for delivery on the dates set forth below, Securities in the amounts set forth below: Delivery Date Shares ------------- ------ Each of such delivery dates is hereinafter referred to as a "Delivery Date".} Payment for the Securities which the undersigned has agreed to purchase for delivery on {the} {each} Delivery Date shall be made to the Company or its order by certified or official bank check in New York Clearing House funds at the office of at . M., time, on such Delivery Date upon delivery to the undersigned of the Securities to be purchased by the undersigned for delivery on such Delivery Date in definitive form and in such denominations and registered in such names as the undersigned may designate by written or telegraphic communication addressed to the Company not less than five full business days prior to such Delivery Date. If no designation is received, the Securities will be registered in the name of the undersigned and issued in a denomination equal to the aggregate amount of Securities to be purchased by the undersigned on such Delivery Date. - -------------- * To be completed when the Underwriting Agreement is executed by the parties thereto. 18 The obligation of the undersigned to take delivery of and make payment for, Securities on {the} {each} Delivery Date shall be subject only to the conditions that (1) investment in the Securities shall not at such Delivery Date be prohibited under the laws of any jurisdiction in the United States to which the undersigned is subject, which investment the undersigned represents is not prohibited on the date hereof, and (2) the Company shall have delivered to the Underwriters the amount of the Securities to be purchased by them pursuant to the Underwriting Agreement referred to in the Prospectus mentioned above and received payment therefor. Promptly after completion of the sale to the Underwriters the Company will mail or deliver to the undersigned at its address set forth below notice to such effect, accompanied by a copy of the opinion of counsel for the Company delivered to the Underwriters in connection therewith. This contract will inure to the benefit of and be binding upon the parties hereto and their respective successors, but will not be assignable by either party hereto without the written consent of the other. It is understood that the acceptance of this contract and any other similar contracts is in the Company's sole discretion and, without limiting the foregoing, need not be on a first-come, first-serve basis. If this contract is acceptable to the Company, it is requested that the Company sign the form of acceptance below and mail or deliver one of the counterparts hereof to the undersigned at its address set forth below. This will become a binding contract between the Company and the undersigned when such counterpart is mailed or delivered. This contract shall be governed by, and construed in accordance with, the laws of the State of New York. Very truly yours, ------------------------------------------------ (Name of Purchaser) By --------------------------------------------- ------------------------------------------------ (Title of Signatory) ------------------------------------------------ ------------------------------------------------ (Address of Purchaser) Accepted, as of the above date. ASSOCIATES FIRST CAPITAL CORPORATION By ----------------------------- Vice President 2 19 SCHEDULE A Underwriting Agreement dated: Registration Statement No.: Representatives: Title of Securities including par value, if any: Number of Shares to be Issued: FOR PREFERRED STOCK: Voting Rights: Dividend: Redemption: Sinking fund: Liquidation Preference: Conversion: Other Terms: Market or Exchange: Date Designated pursuant to Section 4(j): Price to Public: Underwriting Discounts and Commissions: Proceeds to Company Over-allotment Option: FOR COMMON STOCK: Other Terms: Market or Exchange: Date Designated pursuant to Section 4(j): Price to Public: Underwriting Discounts and Commissions: Proceeds to Company: Over-allotment Option: FOR WARRANT SECURITIES: Title of Warrant Securities: Amount of Warrant Securities: Title of Warrant Agreement: Warrant Agent: Number of Warrants: per each $ principal amount of Warrant Securities 20 FOR CONVERTED SECURITIES: Title of Converted Securities: Amount of Converted Securities Voting Rights: Dividends: Redemption: Sinking Fund: Liquidation Preference: Conversion: Other Terms: Market or Exchange: Date Designated pursuant to Section 4(j): Delayed Delivery: Fee: Minimum principal amount of each Contract: Maximum aggregate principal amount of all Contracts: Closing: Office for delivery of Securities, and Warrants, if any: Office for payment for Securities, and Warrants, if any: LeBoeuf, Lamb Greene & MacRae, L.L.P. Date and time of Closing at 10:00 A.M. Office for checking Securities, and Warrants, if any: The Chase Manhattan Bank Address for notices per Section 10: Name of Underwriter to act per Section 11: 21 SCHEDULE B
Number of Shares (with Warrants, if any) UNDERWRITER .......................................... to be purchased --------------------------------------------- -------------- ==============
EX-4.1 4 STANDARD MULTIPLE-SERIES INDENTURE PROVISIONS 1 EXHIBIT 4.1 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- ASSOCIATES FIRST CAPITAL CORPORATION STANDARD MULTIPLE-SERIES INDENTURE PROVISIONS Dated as of June 1, 1998 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 2 ASSOCIATES FIRST CAPITAL CORPORATION CROSS REFERENCE SHEET* Showing the Location in the Associates First Capital Corporation Standard Multiple-Series Indenture Provisions of the Provisions Inserted Pursuant to Sections 310 to 318(a) inclusive of the Trust Indenture Act of 1939. PROVISION OF TRUST INDENTURE ACT OF 1939 INDENTURE PROVISION sec. 310(a) (1), (2).......................... sec. 9.09 (3)............................... Not applicable (4)............................... Not applicable (b) .................................. sec. 9.08; sec. 9.10(b) (c) .................................. Not applicable sec. 311(a) .................................. sec. 9.13(a) (b) .................................. sec. 9.13(b) (c) .................................. Not applicable sec. 312(a) .................................. sec.sec. 7.01, 7.02(a) (b) .................................. sec. 7.02(b) (c) .................................. sec. 7.02(c) sec. 313(a) .................................. sec. 7.04(a) (b) (1)............................... Not applicable (2)............................... sec. 7.04(b) (c) .................................. sec. 7.04(c) (d) .................................. sec. 7.04(d) sec. 314(a) .................................. sec. 7.03 (b) .................................. Not applicable (c) .................................. sec. 1.03 (d) .................................. Not applicable (e) .................................. sec. 1.03 (f) .................................. Not applicable sec. 315(a) (1)............................... sec. 9.01(a)(1) (2)............................... sec. 9.01(a)(2) (b) .................................. sec. 9.02 (c) .................................. sec. 9.01(b) (d) .................................. sec. 9.01(c) (e) .................................. sec. 8.07 sec. 316(a) .................................. sec. 8.01; sec. 8.06 (b) .................................. sec. 8.04; (c) .................................. sec. 10.01 sec. 317(a) (1), (2).......................... sec. 8.02 (b) .................................. sec. 6.02(9), (10) sec. 318(a) .................................. sec. 14.08
- --------------- * This Cross-Reference Sheet is not part of the Standard Multiple-Series Indenture Provisions. 3 ASSOCIATES FIRST CAPITAL CORPORATION --------------------- STANDARD MULTIPLE-SERIES INDENTURE PROVISIONS --------------------- TABLE OF CONTENTS* ARTICLE ONE. DEFINITIONS.
PAGE sec. 1.01. Certain terms defined; other terms defined in Trust Indenture Act of 1939, as amended, or by reference therein in Securities Act of 1933, as amended, to have meanings therein assigned.................... 1 Affiliate........................................... 1 Authenticating Agent................................ 1 Authorized Newspaper................................ 1 Board of Directors.................................. 2 Board Resolution.................................... 2 Business Day........................................ 2 Capital Indebtedness................................ 2 Company............................................. 2 Company Order and Company Request................... 2 Component Currency.................................. 3 Consolidated Subsidiary............................. 3 Controlling Person.................................. 3 Controlling Person Subsidiary....................... 3 Conversion Date..................................... 3 Conversion Rate..................................... 3 Corporate Trust Office.............................. 3 Coupon.............................................. 4 Coupon Security..................................... 4 Depositary.......................................... 4
- --------------- * This Table of Contents does not constitute part of the Standard Multiple- Series Indenture Provisions or have any bearing upon the interpretation of any of its terms and provisions. 4 ii
PAGE Dollar.............................................. 4 Dollar Determination Agent.......................... 4 Dollar Equivalent of the Currency Unit.............. 4 Dollar Equivalent of the Foreign Currency........... 4 ECU................................................. 5 European Communities................................ 5 Event of Default.................................... 5 Exchange Rate Officer's Certificate................. 5 Finance Business.................................... 5 Finance Subsidiary.................................. 6 Foreign Currency.................................... 6 Fully Registered Security........................... 6 Global Security..................................... 6 Holder.............................................. 6 Indebtedness........................................ 6 Indenture........................................... 7 Insurance Business.................................. 7 Insurance Subsidiary................................ 7 Interest............................................ 7 Interest Payment Date............................... 7 Market Exchange Rate................................ 7 Maturity............................................ 7 Officers' Certificate............................... 7 Official Currency Unit Exchange Rate................ 8 Opinion of Counsel.................................. 8 Original Issue Discount Security.................... 8 Outstanding (with reference to Securities).......... 8 Overdue Rate........................................ 9 Paying Agent........................................ 9 Person.............................................. 10 Place of Payment.................................... 10 Predecessor Security................................ 10 Receivables......................................... 10 Redemption Date..................................... 10 Redemption Price.................................... 10 Registered Holder................................... 11 Registered Security................................. 11 Responsible Officer................................. 11
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PAGE Securities Register and Securities Registrar........ 11 Security............................................ 11 Specified Amount.................................... 11 Stated Maturity..................................... 11 Subordinated Indebtedness........................... 12 Subsidiary.......................................... 12 Superior Indebtedness............................... 12 Trustee............................................. 12 Trust Indenture Act................................. 12 Unregistered Security............................... 12 Valuation Date...................................... 12 sec. 1.02. Other Defined Terms................................. 13 sec. 1.03. Compliance Certificates and Opinions................ 13 ARTICLE TWO. SECURITY FORMS. sec. 2.01. Form Generally...................................... 13 sec. 2.02. Form of Trustee's Certificate of Authentication..... 14 sec. 2.03. Form of Trustee's Certificate of Authentication by an Authenticating Agent........................ 15 sec. 2.04. Securities Issuable in the Form of a Global Security.......................................... 15 ARTICLE THREE. THE SECURITIES. sec. 3.01. Amount Unlimited; Issuable in Series................ 17 sec. 3.02. Form and Denominations.............................. 20 sec. 3.03. Authentication and Dating........................... 20 sec. 3.04. Execution of Securities and Coupons................. 22 sec. 3.05. Registration; Registration of Transfer and Exchange.......................................... 23 sec. 3.06. Mutilated, Destroyed, Lost or Stolen Securities or Coupons........................................ 25 sec. 3.07. Temporary Securities................................ 26
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PAGE sec. 3.08. Payment of Interest; Interest Rights Preserved...... 27 sec. 3.09. Cancellation........................................ 28 sec. 3.10. Computation of Interest............................. 28 sec. 3.11. Currency and Manner of Payments in Respect of Securities............................. 29 sec. 3.12. Compliance with Certain Laws and Regulations........ 34 ARTICLE FOUR. REDEMPTION OF SECURITIES. sec. 4.01. Applicability of Article............................ 34 sec. 4.02. Notice of Redemption; Selection of Securities....... 34 sec. 4.03. Payment of Securities Called for Redemption......... 36 ARTICLE FIVE. SINKING FUNDS. sec. 5.01. Applicability of Article............................ 37 sec. 5.02. Satisfaction of Mandatory Sinking Fund Payments with Securities........................................ 37 sec. 5.03. Redemption of Securities for Sinking Fund........... 38 ARTICLE SIX. CERTAIN COVENANTS OF THE COMPANY. sec. 6.01. Payment of Securities............................... 41 sec. 6.02. Other Covenants..................................... 41 (1) Office or Agency................................ 41 (2) Maintenance of Corporate Existence.............. 42 (3) Taxes, etc...................................... 43 (4) Books of Account................................ 43 [(5) Liens, etc..................................... 43] (6) Consolidations, Mergers, etc.................... 45
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PAGE (7) Other Instruments, etc.......................... 46 (8) Permit no Vacancy in Office of Trustee.......... 46 (9) Agreement with Paying Agent..................... 46 (10) Money for Securities Payments to be Held in Trust............................................ 47 (11) Financial Statements, etc...................... 48 (12) Transactions with Controlling Persons.......... 49 sec. 6.03. Waiver.............................................. 49 ARTICLE SEVEN. HOLDERS' LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE. sec. 7.01. Semi-Annual Lists of Holders........................ 49 sec. 7.02. Preservation of Information, etc.................... 50 sec. 7.03. Periodic Reports by Company......................... 52 sec. 7.04. Trustee's Reports to Holders........................ 53 sec. 7.05. Delivery of Reports by the Trustee.................. 55 ARTICLE EIGHT. REMEDIES OF THE TRUSTEE AND HOLDERS ON EVENT OF DEFAULT. sec. 8.01. Events of Default; Effect Thereof................... 55 sec. 8.02. Collection of Indebtedness by Trustee............... 58 sec. 8.03. Application of Moneys Collected by Trustee.......... 60 sec. 8.04. Limitation on Suits on Indenture; No Limitation on Suits on Securities................................. 62 sec. 8.05. Remedies Cumulative; Delay not to Impair Rights..... 63 sec. 8.06. Directions by Holders of Securities................. 63 sec. 8.07. Undertakings for Costs.............................. 63 sec. 8.08. Waiver of Stay or Extension Laws.................... 64 sec. 8.09. Judgment Currency................................... 64
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PAGE ARTICLE NINE. CONCERNING THE TRUSTEE. sec. 9.01. Certain Duties and Responsibilities................. 65 sec. 9.02. Notice of Defaults.................................. 66 sec. 9.03. Certain Rights of Trustee........................... 67 sec. 9.04. Not Responsible for Recitals or Issuance of Securities....................................... 68 sec. 9.05. May Hold Securities................................. 68 sec. 9.06. Money Held in Trust................................. 68 sec. 9.07. Compensation and Reimbursement...................... 69 sec. 9.08. Disqualification; Conflicting Interests............. 69 sec. 9.09. Corporate Trustee Required; Eligibility............. 70 sec. 9.10. Resignation and Removal; Appointment of Successor... 70 sec. 9.11. Acceptance of Appointment by Successor.............. 72 sec. 9.12. Merger, Conversion, Consolidation or Succession to Business....................................... 73 sec. 9.13. Preferential Collection of Claims Against Company... 74 (a) Segregation and Apportionment of Certain Collections by Trust; Certain Exceptions............ 74 (b) Certain Creditor Relationships Excluded From Segregation and Apportionment....................... 77 (c) Definitions of Certain Terms Used in this Section..................................... 78 sec. 9.14. Appointment of Authenticating Agent................. 79 ARTICLE TEN. CONCERNING THE HOLDERS OF SECURITIES. sec. 10.01. Action by Holders................................... 80 sec. 10.02. Proof of Execution of Instruments by Holders of Securities..................................... 81 sec. 10.03. Persons Deemed Owners............................... 82 sec. 10.04. Revocation of Consents; Future Holders Bound........ 82
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PAGE ARTICLE ELEVEN. HOLDERS' MEETINGS. sec. 11.01. Purposes of Meetings................................ 83 sec. 11.02. Call of Meetings by Trustee......................... 83 sec. 11.03. Call of Meetings by Company or Holders.............. 83 sec. 11.04. Qualifications for Voting........................... 84 sec. 11.05. Regulations......................................... 84 sec. 11.06. Voting.............................................. 85 sec. 11.07. No Delay of Rights by Meeting....................... 86 ARTICLE TWELVE. SUPPLEMENTAL INDENTURES. sec. 12.01. Supplemental Indentures............................. 86 sec. 12.02. Notice of Supplemental Indenture.................... 89 sec. 12.03. Effect of Supplemental Indenture.................... 89 sec. 12.04. Notation on Securities and Coupons.................. 89 sec. 12.05. Issuance of Securities by Successor Corporation..... 90 ARTICLE THIRTEEN. SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED MONEYS. sec. 13.01. Satisfaction and Discharge.......................... 91 sec. 13.02. Application of Moneys............................... 92 sec. 13.03. Repayment of Moneys by Paying Agents................ 92 sec. 13.04. Unclaimed Moneys.................................... 92 ARTICLE FOURTEEN. MISCELLANEOUS PROVISIONS. sec. 14.01. Limitation of Individual Liability.................. 93 sec. 14.02. Successors.......................................... 93 sec. 14.03. Notice to Holders; Waiver........................... 93 sec. 14.04. Addresses for Notices............................... 94 sec. 14.05. Cross References.................................... 95 sec. 14.06. Counterparts........................................ 95 sec. 14.07. Headings Not to Affect Construction................. 95
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PAGE sec. 14.08. Trust Indenture Act to Govern....................... 95 sec. 14.09. Legal Holidays...................................... 95 sec. 14.10. Applicable Law...................................... 95 ARTICLE FIFTEEN. SUBORDINATION OF SECURITIES. sec. 15.01. Subordination....................................... 96 sec. 15.02. Securities May Be Paid Prior to Dissolution, etc.... 98 sec. 15.03. Rights of the Holders of Superior Indebtedness Not to be Impaired................................ 98 sec. 15.04. Authorization to Trustee to Take Action to Effectuate Subordination.......................... 99
11 ARTICLE ONE. DEFINITIONS. sec. 1.01 Certain Definitions. The terms defined in this sec. 1.01 (except as herein otherwise expressly provided or unless the context otherwise requires) for all purposes of this Indenture and of any indenture supplemental hereto shall have the respective meanings specified in this sec. 1.01 (such definitions to be applicable to both the singular and the plural form of the terms defined). All other terms used in this Indenture which are defined in the Trust Indenture Act, or which are by reference in such Act defined in the Securities Act of 1933, as amended (except as herein otherwise expressly provided or unless the context otherwise requires), shall have the meanings assigned to such terms in said Trust Indenture Act and in such Securities Act as in force at the date of the execution of this Indenture. Affiliate: "Affiliate" of the Company or any other obligor on the Securities shall mean any person or corporation directly or indirectly controlling, controlled by, or under direct or indirect common control with, the Company or such obligor on the Securities. Authenticating Agent: "Authenticating Agent" shall mean any authenticating agent appointed by the Trustee pursuant to sec. 9.14. Authorized Newspaper: "Authorized Newspaper" shall mean a newspaper in an official language of the country of publication customarily published at least once a day, and customarily published for at least five days in each calendar week, and of general circulation in such city or cities as may be provided elsewhere in this Indenture or specified as contemplated by sec. 3.01 with respect to the Securities of any series the terms of which permit Unregistered Securities or Coupon Securities. 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 in such city. 12 2 Board of Directors: "Board of Directors" shall mean either the board of directors of the Company or any duly authorized committee of that board. Board Resolution: "Board Resolution" shall mean a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company to have been duly adopted by the Board of Directors and to be in full force and effect on the date of such certification, and delivered to the Trustee. Business Day: "Business Day", when used in conjunction with the name of a city, shall mean any day other than a day on which banking institutions in such city are authorized or required by law to close, and shall otherwise mean each day of the week which is not a day on which banking institutions at the place where any specified act pursuant to this Indenture is to occur are authorized or required by law to close. Capital Indebtedness: "Capital Indebtedness" shall mean all Indebtedness of the Company which is subordinate and junior in right of payment to Superior Indebtedness and Subordinated Indebtedness. Company: "Company" shall mean Associates First Capital Corporation, a Delaware corporation, until a successor corporation shall have become such pursuant to the applicable provisions of this Indenture, and thereafter "Company" shall mean such successor corporation. Company Order and Company Request: "Company Order" and "Company Request" shall mean a written order or written request, respectively, signed in the name of the Company, by its Chairman or a Vice Chairman of the Board, President or a Vice President, and by its Treasurer, Assistant Treasurer, Comptroller, an Assistant Comptroller, Secretary or an Assistant Secretary, and delivered to the Trustee. Component Currency: "Component Currency": See sec. 3.11(i). 13 3 Consolidated Net Worth: "Consolidated Net Worth": See sec. 6.02(5) Consolidated Subsidiary: "Consolidated Subsidiary" shall mean every Subsidiary except any Subsidiary the accounts of which are, with the approval of the independent accountants who regularly audit the books of the Company, excluded from the consolidated financial statements regularly released by the Company to the public, but any such Subsidiary shall be deemed not to constitute a Consolidated Subsidiary only during any period or periods for which its accounts are so excluded. Controlling Person: "Controlling Person" shall mean any Person who, to the knowledge of the Company, is directly or indirectly in control of the Company, said control being the power to direct or cause the direction of the management or policies of the Company (whether through the ownership of voting securities, by contract or otherwise), or is an officer, director, partner or manager of such a Person. Controlling Person Subsidiary: "Controlling Person Subsidiary" shall mean any corporation (other than the Company and its Subsidiaries) of which a Controlling Person at the time owns or controls, directly and/or through any intervening medium, more than fifty percent (50%) of the outstanding stock having ordinary voting power. Conversion Date: "Conversion Date": See sec. 3.11(e). Conversion Rate: "Conversion Rate": See sec. 8.09. Corporate Trust Office: "Corporate Trust Office" shall mean the principal office of the Trustee at which at any particular time its corporate trust business shall be administered, except that with respect to presentation of Registered Securities for payment or for registration of transfer and exchange, presentation of Unregistered Securities for registration and the location of the Securities Register, such term shall 14 4 mean the office or agency of the Trustee at which at any particular time, its corporate agency business shall be conducted. Coupon: "Coupon" shall mean any interest coupon appertaining to any Security. Coupon Security: "Coupon Security" shall mean any Security authenticated and delivered with one or more Coupons appertaining thereto. Depositary: "Depositary" shall mean, unless otherwise specified by the Company pursuant to either sec. 2.04 or sec. 3.01, with respect to Securities of any series issuable or issued as a Global Security, The Depository Trust Company, New York, New York, or any successor thereto registered under the Securities and Exchange Act of 1934, as amended, or other applicable statute or regulation. Dollar: "Dollar" shall mean the coin or currency of the United States of America as at the time of payment is legal tender for the payment of public and private debts. Dollar Determination Agent: "Dollar Determination Agent" shall mean the New York clearing house bank, if any, from time to time selected by the Trustee for purposes of sec. 3.11. Dollar Equivalent of the Currency Unit: "Dollar Equivalent of the Currency Unit": See sec. 3.11(h). Dollar Equivalent of the Foreign Currency: "Dollar Equivalent of the Foreign Currency": See sec. 3.11(g). ECU: "ECU" shall mean the European Currency Unit as defined and revised from time to time by the Council of the European Communities. 15 5 European Communities: "European Communities" shall mean the European Economic Community, the European Coal and Steel Community and the European Atomic Energy Community. Event of Default: "Event of Default": See sec. 8.01. Exchange Rate Officer's Certificate: "Exchange Rate Officer's Certificate" shall mean a telex or a certificate setting forth (i) the applicable Official Currency Unit Exchange Rate and (ii) the Dollar or Foreign Currency amounts of principal, premium, if any, and interest, if any, respectively (on an aggregate basis and on the basis of a Security having a principal amount of 1,000 in the relevant currency unit), payable on the basis of such Official Currency Unit Exchange Rate, sent (in the case of a telex) or signed (in the case of a certificate) by the Treasurer or any Assistant Treasurer of the Company. Finance Business: "Finance Business" shall mean the business of making loans, extending credit, or providing financial accommodations to any person, firm or corporation and such activities as may be incidental thereto, including, but not limited to: the purchase of obligations growing out of the sale or lease of all types of consumer, commercial and industrial property; the making of loans to individuals and business enterprises, including the extension of wholesale or floor plan accommodations to permit distributors and dealers to carry inventories of durable goods for resale; factoring; leasing of tangible personal property to others; mortgage brokerage and servicing; and other business of a similar character to the extent that other companies similarly situated, within the limits of sound trade practice, may have heretofore engaged or may hereafter engage in such other business. Finance Business as herein defined shall not include the business of a federally insured deposit-taking institution. Finance Subsidiary: "Finance Subsidiary" shall mean a Subsidiary primarily engaged in the Finance Business. Foreign Currency: "Foreign Currency" shall mean a currency issued by the government of any country other the United States. 16 6 Fully Registered Security: "Fully Registered Security" shall mean any Security registered as to principal and interest, if any. Global Security: "Global Security" shall mean a Security issued to evidence all or a part of any series of Securities which is executed by the Company and authenticated and delivered by the Trustee to the Depositary or pursuant to the Depositary's instruction, all in accordance with this Indenture and pursuant to a Company Order, which shall be registered as to principal and interest in the name of the Depositary or its nominee. Holder: "Holder" shall mean, with respect to a Registered Security, any person whose name at the time a particular Registered Security is registered in the Securities Register; with respect to an Unregistered Security, the bearer of such Unregistered Security; and, with respect to a Coupon, the bearer thereof. Indebtedness: "Indebtedness" of any corporation shall include all obligations of such corporation which in accordance with generally accepted accounting practice shall be classified upon a balance sheet of such corporation as liabilities of such corporation, and guaranties (whether by discount or otherwise) of, endorsements (other than endorsements of checks and drafts for deposits in the ordinary course of business) and other contingent obligations (other than obligations revocable by the obligor, to purchase or otherwise acquire from dealers notes, receivables or other obligations of their customers) in respect of, or to purchase or otherwise acquire, indebtedness of others. In computing the amount of Indebtedness at any date, there shall be included an amount equal to adequate reserves in accordance with generally accepted accounting principles at such date in respect of any contested debts or other similar monetary obligations of such corporation, either direct or guaranteed, not otherwise required to be reflected pursuant to the preceding sentence. Indenture: "Indenture" shall mean this instrument as originally executed, or as it may be amended or supplemented from time to time as herein provided, and shall include the form and terms of particular series of Securities established as contemplated hereunder, regardless of the currency or currency unit in which such series is denominated. 17 7 Insurance Business: "Insurance Business" shall mean the business of issuing fire, casualty, inland marine, ocean marine, credit, fidelity, mortgage, title, life, health or accident insurance contracts, or other contracts authorized to be written by an insurance company, and businesses incidental thereto. Insurance Subsidiary: "Insurance Subsidiary" shall mean a Subsidiary primarily engaged in the Insurance Business. Interest: The term "interest" when used with respect to non-interest bearing Securities, means interest payable after Maturity. Interest Payment Date: "Interest Payment Date" shall mean the Stated Maturity of an installment of interest on the Securities of any series. Market Exchange Rate: "Market Exchange Rate": See sec. 3.11(i). Maturity: "Maturity", when used with respect to any Security, shall mean the date on which the principal of such Security becomes due and payable as therein or herein provided, whether at the Stated Maturity or by declaration of acceleration, call for redemption or otherwise. Officers' Certificate: "Offficers' Certificate" shall mean a certificate signed by the Chairman or a Vice Chairman of the Board, the President or a Vice President, and by the Treasurer, an Assistant Treasurer, the Comptroller, an Assistant Comptroller, the Secretary or an Assistant Secretary of the Company, and delivered to the Trustee. Official Currency Unit Exchange Rate: "Official Currency Unit Exchange Rate" shall mean, with respect to any payment to be made hereunder, the exchange rate between the relevant currency unit and the Dollar calculated by the agency specified pursuant to 18 8 sec. 3.01 for the Securities of the relevant series (in the case of the ECU, calculated by the Commission of the European Communities, and currently based on the rates in effect at 2:30 p.m., Brussels time, on the exchange markets of the Component Currencies of the ECU), on the second Business Day (in the city of which such agency has its principal office) immediately preceding the applicable payment date. Opinion of Counsel: "Opinion of Counsel" shall mean an opinion in writing signed by legal counsel, who may be an employee of or of counsel to the Company. Original Issue Discount Security: "Original Issue Discount Security" shall mean any Security which provides for an amount less than the principal amount thereof to be due and payable upon a declaration of acceleration of the maturity thereof pursuant to sec. 8.01. Outstanding: "Outstanding", when used with reference to Securities, shall mean, as of any particular time, all Securities authenticated and delivered by the Trustee under this Indenture, except (a) Securities theretofore cancelled by the Trustee or delivered to the Trustee for cancellation; (b) Securities, or portions thereof, for the payment or redemption of which moneys in the necessary amount and in the required currency or currency unit shall have been deposited in trust with the Trustee or with any Paying Agent (other than the Company or any other obligor on the Securities) or shall have been set aside and segregated in trust by the Company or any other obligor on the Securities (if the Company or any other obligor on the Securities shall act as its own Paying Agent) for the Holders of such Securities and any Coupons appertaining thereto, provided that if such Securities are to be redeemed prior to the maturity thereof, notice of such redemption shall have been given as in Article Four provided, or provision satisfactory to the Trustee shall have been made for giving such notice; and (c) Securities in lieu of and in substitution for which other Securities shall have been authenticated and delivered pursuant to sec. 3.06, other than any such Securities in respect of which there shall have been presented to 19 9 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 Securities Outstanding 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 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 such other obligor. In determining whether the Holders of the requisite principal amount of Outstanding Securities have given any request, demand, authorization, direction, notice, consent or waiver hereunder, the principal amount of an Original Issue Discount Security that shall be deemed to be Outstanding for such purposes shall be the amount of the principal thereof that would be due and payable as of the date of such determination upon a declaration of acceleration of the Maturity thereof pursuant to sec. 8.01. Overdue Rate: "Overdue Rate" with respect to any series of Securities shall mean the rate designated as such in or pursuant to the resolution of the Board of Directors or the supplemental indenture, as the case may be, relating to such series as contemplated by sec. 3.01. Paying Agent: "Paying Agent" shall mean any person authorized by the Company to pay the principal of, or premium or interest on, any Securities on behalf of the Company. Person: "Person" shall mean any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof. 20 10 Place of Payment: "Place of Payment", when used with respect to the Securities of any series, shall mean the place or places where the principal of, premium, if any, and interest, if any, on the Securities of such series are payable as specified pursuant to sec. 3.01. Predecessor Security: "Predecessor Security" of any particular Security shall mean every previous Security evidencing all or a portion of the same debt as that evidenced by such particular Security; and, for the purposes of this definition, any Security authenticated and delivered under sec. 3.06 in lieu of a lost, destroyed or stolen Security shall be deemed to evidence the same debt as the lost, destroyed or stolen Security. Receivables: "Receivables" shall mean, without duplication, at any time, all notes and accounts receivable (whether represented by open accounts, notes, mortgages, factoring receivables, direct loan receivables, trade accounts receivable, lease obligations or otherwise) at the time held by the Company and its Consolidated Subsidiaries, as shown on a consolidated balance sheet of the Company and its Consolidated Subsidiaries, other than notes and accounts receivable which have arisen from the Insurance Business, any manufacturing business or any other business which is not the Finance Business. Redemption Date: "Redemption Date" when used with respect to any Security to be redeemed shall mean the date fixed for such redemption by or pursuant to this Indenture. Redemption Price: "Redemption Price" when used with respect to any Security to be redeemed shall mean the price, in the currency or currency unit in which such Security is denominated or which is otherwise provided for pursuant to this Indenture, at which it is to be redeemed pursuant to this Indenture. Registered Holder: "Registered Holder" shall mean, with respect to a Registered Security, the Person in whose name such Security is registered in the Securities Register. 21 11 Registered Security: "Registered Security" shall mean any Security registered as to principal. Responsible Officer: "Responsible Officer" when used with respect to the Trustee shall mean the chairman of the board of directors, a vice chairman of the board of directors, the chairman of the executive committee, the president, any vice president, the secretary, the treasurer, any trust officer, or any other officer or assistant officer of the Trustee customarily performing functions similar to those performed by the persons who at the time shall be such officers, respectively, or to whom any corporate trust matter is referred because of his knowledge of and familiarity with the particular subject. Securities Register and Securities Registrar: "Securities Register" and "Securities Registrar": See sec. 3.05. Security: "Security" or "Securities" shall have the meaning stated in the recitals of this Indenture and more particularly shall mean any Registered or Unregistered Securities authenticated and delivered under this Indenture. Special Committee: "Special Committee" shall mean a committee consisting of members of the Board of Directors of the Company as duly authorized and established by the Board of Directors. Special Committee Resolution: "Special Committee Resolution" shall mean a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company to have been duly adopted by the Special Committee and to such full form and effect on the date of such certificates, and delivered to the Trustee. Specified Amount: "Specified Amount": See sec. 3.11(i). Stated Maturity: "Stated Maturity" when used with respect to any Security or any installment of interest thereon shall mean the date specified in such Security or 22 12 the Coupon, if any, representing such installment of interest as the fixed date on which the principal of, premium, if any, or interest, if any, on such Security is due and payable. Subordinated Indebtedness: "Subordinated Indebtedness" shall mean all Indebtedness of the Company which is subordinate and junior in right of payment to Superior Indebtedness. The term "Subordinated Indebtedness" shall not include Capital Indebtedness of the Company. Subsidiary: "Subsidiary" shall mean any corporation of which the Company at the time owns or controls, directly and/or through any intervening medium, more than fifty percent (50%) of the outstanding stock having ordinary voting power. Superior Indebtedness: "Superior Indebtedness": See sec. 15.01. Trustee: "Trustee" shall mean the Person named as the "Trustee" in the first paragraph of this instrument and, subject to the provisions of Article Nine, shall also include its successors and assigns. If there shall be more than one Trustee at any one time, "Trustee" shall mean each such Trustee and shall apply to each such Trustee only with respect to those series of Securities with respect to which it is serving as Trustee. Trust Indenture Act: Except as provided in sec. 12.01, "Trust Indenture Act" shall mean the Trust Indenture Act of 1939, as amended by the Trust Indenture Reform Act of 1990 and in force at the date of execution of this Indenture. Unregistered Security: "Unregistered Security" means any Security that is not registered as to principal. Valuation Date: "Valuation Date": See sec. 3.11(e). 23 13 sec. 1.02. Other Defined Terms. Certain other terms are defined in Article Nine. sec. 1.03. Compliance Certificates and Opinions. Upon any application or request by the Company to the Trustee to take any action under any provision of this Indenture, the Company shall furnish to the Trustee an Officers' Certificate stating that all conditions precedent (including any covenants compliance with which constitutes a condition precedent), if any, provided for in this Indenture relating to the proposed action have been complied with and an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent (including any covenants compliance with which constitutes a condition precedent), if any, have been complied with, except that in the case of any such application or request as to which the furnishing of such documents is specifically required by any provision of this Indenture relating to such particular application or request, no additional certificate or opinion need be furnished. Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture (other than annual certificates provided pursuant to sec. 6.02(ll)) shall include (1) a statement that each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto; (2) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based; (3) a statement that, in the opinion of each such individual, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and (4) a statement as to whether, in the opinion of each such individual, such condition or covenant has been complied with. 24 14 ARTICLE TWO. SECURITY FORMS. sec. 2.01. Forms Generally. The Securities of each series, and the Coupons if any, to be attached thereto, shall be in substantially the form or forms as shall be established pursuant to sec. 3.01 in each case 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 any law or with any rules made pursuant thereto or with any rules of any securities exchange or as may, consistently herewith, be determined by the officers executing such Securities, and Coupons, if any, as evidenced by their execution of the Securities and Coupons, if any. The definitive Securities, and Coupons, if any, of each series shall be printed, lithographed or engraved on steel engraved borders or may be produced in any other manner, all as determined by the officers executing such Securities, and Coupons, if any, as evidenced by their execution of such Securities, and Coupons, if any, subject, with respect to the Securities of any series, to the rules of any securities exchange on which the Securities of such series are listed. sec. 2.02. Form of Trustee's Certificate of Authentication. The Trustee's Certificate of Authentication on all Securities shall be in substantially the following form: This is one of the Securities of the series provided for under the within- mentioned Indenture. [NAME OF TRUSTEE] as Trustee By Authorized Officer 25 15 sec. 2.03. Form of Trustee's Certificate of Authentication by an Authenticating Agent. If at any time there shall be an Authenticating Agent appointed with respect to any series of Securities, then the Trustee's Certificate of Authentication by such Authenticating Agent on all Securities of each such series shall be in substantially the following form: [NAME OF TRUSTEE] as Trustee By [NAME OF AUTHENTICATING AGENT], Authenticating Agent By Authorized Officer sec. 2.04. Securities Issuable in the Form of a Global Security. (a) If the Company shall establish pursuant to sec. 3.01 that the Securities of a particular series are to be issued in whole or in part in the form of one or more Global Securities, then the Company shall execute and the Trustee shall, in accordance with sec. 3.03 and the Company Order delivered to the Trustee thereunder, authenticate and deliver, such Global Security or Securities, which (i) shall represent, and shall be denominated in an amount equal to the aggregate principal amount of, the Outstanding Securities of such series to be represented by such Global Security or Securities, (ii) shall be registered in the name of the Depositary for such Global Security or Securities or its nominee, (iii) shall be delivered by the Trustee to the Depositary or pursuant to the Depositary's instruction and (iv) shall bear a legend substantially to the following effect: "Unless and until it is exchanged in whole or in part for the individual Securities represented hereby, this Global Security may not be transferred except as a whole by the Depositary to a nominee of the Depositary or by a nominee of the Depositary to the Depositary or another nominee of the Depositary or by the Depositary or any such nominee to a successor Depositary or a nominee of such successor Depositary." (b) Notwithstanding any other provision of this sec. 2.04 or of sec. 3.05, unless the terms of a Global Security expressly permit such Global Security to be exchanged in whole or in part for individual Securities, a Global Security may be transferred, in whole but not in part and in the manner provided in sec. 3.05, 26 16 only to the Depositary or another nominee of the Depositary for such Global Security, or to a successor Depositary for such Global Security selected or approved by the Company or to a nominee of such successor Depositary. (c)(i) If at any time the Depositary for a Global Security notifies the Company that it is unwilling or unable to continue as Depositary for such Global Security or if at any time the Depositary for the Securities for such series shall no longer be eligible or in good standing under the Securities Exchange Act of 1934, as amended, or other applicable statute or regulation, the Company shall appoint a successor Depositary with respect to such Global Security. If a successor Depositary for such Global Security is not appointed by the Company within 90 days after the Company receives such notice or becomes aware of such ineligibility, the Company's election pursuant to sec. 3.01(17) shall no longer be effective with respect to such Global Security and the Company will execute, and the Trustee, upon receipt of a Company Order for the authentication and delivery of individual Securities of such series in exchange for such Global Security, will authenticate and deliver individual Securities of such series of like tenor and terms in definitive form in an aggregate principal amount equal to the principal amount of the Global Security in exchange for such Global Security. (ii) The Company may at any time and in its sole discretion determine that the Securities of any series issued or issuable in the form of one or more Global Securities shall no longer be represented by such Global Security or Securities. In such event the Company will execute, and the Trustee, upon receipt of a Company Order for the authentication and delivery of individual Securities of such series in exchange in whole or in part for such Global Security, will authenticate and deliver individual Securities of such series of like tenor and terms in definitive form in an aggregate principal amount equal to the principal amount of such Global Security or Securities representing such series in exchange for such Global Security or Securities. (iii) If specified by the Company pursuant to sec. 3.01 with respect to Securities issued or issuable in the form of a Global Security, the Depositary for such Global Security may surrender such Global Security in exchange in whole or in part for individual Securities of such series of like tenor and terms in definitive form on such terms as are acceptable to the Company and such Depositary. Thereupon the Company shall execute, and the Trustee shall authenticate and deliver, without service charge, (1) to each Person specified by such Depositary a new Security or Securities of the same series of like tenor and terms and of any authorized denominations as requested by such Person or the Depositary in aggregate principal amount equal to and in exchange for such Person's beneficial interest in the Global Security; and (2) to such Depositary 27 17 a new Global Security of like tenor and terms and in a denomination equal to the difference, if any, between the principal amount of the surrendered Global Security and the aggregate principal amount of Securities delivered to Holders thereof. (iv) In any exchange provided for in any of the preceding three paragraphs, the Company will execute and the Trustee will authenticate and deliver individual Fully Registered Securities in authorized denominations. Upon the exchange of a Global Security for individual Securities, such Global Security shall be cancelled by the Trustee. Securities issued in exchange for a Global Security pursuant to this sec. 2.04 shall be registered in such names and in such authorized denominations as the Depositary for such Global Security, pursuant to instructions from its direct or indirect participants or otherwise, shall instruct the Trustee. The Trustee shall deliver such Securities to the persons in whose names such Securities are so registered. ARTICLE THREE. THE SECURITIES. sec. 3.01. Amount Unlimited; Issuable in Series. The aggregate principal amount of Securities which may be authenticated and delivered under this Indenture is unlimited. The Securities may be issued in one or more series. There shall be established in or pursuant to the authority granted in a Board Resolution or a Special Committee Resolution or established in one or more indentures supplemental hereto, prior to the issuance of any Securities of any series: (1) the title of the Securities of such series (which shall distinguish the Securities of such series from all other series of Securities); (2) any limit upon the aggregate principal amount of the Securities of such series which may be authenticated and delivered under this Indenture (except for Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Securities of such series pursuant to sec.sec. 2.04, 3.05, 3.06, 3.07, 4.03, or 12.04); (3) the date or dates on which such Securities may be issued; (4) the date or dates, which may be serial, on which the principal and premium, if any, of the Securities of such series is payable; (5) the rate or rates, or the method of determination thereof, at which the Securities of such series shall bear interest, if any, the date or 28 18 dates from which such interest shall accrue, the Interest Payment Dates on which such interest shall be payable and, in the case of Registered Securities, the record dates, if other than as set forth in sec. 3.08, for the determination of Holders to whom interest is payable, and whether any special terms and conditions relating to the payment of additional amounts in respect of payments on the Securities of such series shall in the event of certain changes in the United States Federal income tax laws apply to Unregistered Securities of such series or to Registered Securities of such series; (6) the place or places where the principal of, and premium, if any, and interest, if any, on Securities of such series shall be payable; (7) the provisions, if any, establishing the price or prices at which, the period or periods within which and the terms and conditions upon which Securities of such series may be redeemed, in whole or in part, at the option of the Company, pursuant to any sinking fund or otherwise, and whether any special terms and conditions of redemption shall apply to Unregistered Securities of such series or to Registered Securities of such series; (8) the obligation, if any, of the Company to redeem, purchase or repay Securities of such series pursuant to any sinking fund or analogous provisions or at the option of a Holder thereof and the price or prices, in the currency or currency unit in which the Securities of such series are payable, at which and the period or periods within which and the terms and conditions upon which Securities of such series shall be redeemed, purchased or repaid, in whole or in part, pursuant to such obligation; (9) if other than denominations of 1,000 and any integral multiple thereof, in the currency or currency unit in which the Securities of such series are denominated, the denominations in which Securities of such series shall be issuable; (10) if other than the principal amount thereof, the portion of the principal amount of Securities of such series which shall be payable upon declaration of acceleration of the maturity thereof pursuant to sec. 8.01 or provable in bankruptcy pursuant to sec. 8.02; (11) whether payment of the principal of, premium, if any, and interest, if any, on the Securities of such series shall be with or without deduction for taxes, assessments or governmental charges, and with or without reimbursement of taxes, assessments or governmental charges paid by Holders; 29 19 (12) any Events of Default with respect to the Securities of such series, if not set forth herein; (13) if other than the rate of interest stated in the title of the Securities of such series, the applicable Overdue Rate; (14) in case the Securities of such series do not bear interest, the applicable dates for the purpose of clause (i) of sec. 7.01; (15) whether the Securities of such series are to be issued as Registered Securities (with or without Coupons) or Unregistered Securities or both, and, if Unregistered Securities or Coupon Securities are issued, whether Unregistered Securities or Coupon Securities of such series may be exchanged for Registered Securities or Fully Registered Securities of such series and whether Registered Securities or Fully Registered Securities of such series may be exchanged for Unregistered Securities of such series and the circumstances under which and the place or places where any such exchanges, if permitted, may be made; (16) the currency or currencies, or currency unit or currency units, whether Dollars or otherwise, in which the Securities of such series or any interest or other amounts payable with respect thereto, including, without limitation, Coupons, are to be denominated, payable, redeemable or repurchasable, as the case may be; (17) whether the Securities of the series shall be issued in whole or in part in the form of a Global Security or Securities; the terms and conditions, if any, upon which such Global Security or Securities may be exchanged in whole or in part for other individual Securities; and the Depositary for such Global Security or Securities; and (18) if and the terms and conditions upon which the Securities of such series may or must be converted into securities, property, cash or obligations of the Company or exchanged for securities, property, cash or obligations of the Company or another enterprise; and (19) any other terms of such series (which terms shall not be inconsistent with the provisions of this Indenture). All Securities of any one series shall be substantially identical except as to denomination and except as may otherwise be provided in or pursuant to the authority granted in such resolution of the Board of Directors or in any such indenture supplemental thereto. 30 20 sec. 3.02. Form and Denominations. In the absence of any specification pursuant to sec. 3.01 with respect to the Securities of any series, the Securities of such series shall be issuable as Fully Registered Securities in denominations of $1,000 and any integral multiple thereof, and shall be payable in Dollars. sec. 3.03. Authentication and Dating. At any time and from time to time after the execution and delivery of this Indenture, the Company may deliver Securities of any series, with appropriate Coupons, if any, attached thereto, executed by the Company to the Trustee for authentication. Except as otherwise provided in this Article Three, the Trustee shall thereupon authenticate and deliver, or cause to be authenticated and delivered, said Securities to or upon Company Order, without any further action by the Company. In authenticating such Securities, and accepting the additional responsibilities under this Indenture in relation to such Securities, the Trustee shall be entitled to receive, prior to the initial authentication of such Securities, and (subject to sec. 9.01) shall be fully protected in relying upon: (1) a Board Resolution or Special Committee Resolution relating thereto and, if applicable, an appropriate record of any action taken pursuant to such Resolution, in each case certified by the Secretary or an Assistant Secretary of the Company; (2) an executed supplemental indenture, if any, relating thereto; (3) an Officers' Certificate, which shall state that all conditions precedent provided for in this Indenture relating to the issuance of such Securities have been complied with, that no Event of Default with respect to any series of Securities has occurred and is continuing and that the issuance of such Securities does not constitute and will not result in (i) any Event of Default or any event or condition, which, upon the giving of notice or the lapse of time or both, would become an Event of Default or (ii) any default under the provisions of any other instrument or agreement by which the Company is bound; and (4) an Opinion of Counsel, which shall state (a) that the form of such Securities and Coupons, if any, has been established by or pursuant to the authority granted in a resolution of the Board of Directors delivered to the Trustee pursuant to subparagraph (1) above or by a supplemental indenture as permitted by sec. 2.01 in conformity with the provisions of this Indenture; 31 21 (b) that the terms of such Securities and Coupons, if any, have been established by or pursuant to sec. 3.01 in conformity with the provisions of this Indenture; (c) that such Securities, when authenticated and delivered by the Trustee and issued by the Company in the manner and subject to any conditions specified in such Opinion of Counsel, will constitute (together with the Coupons, if any, appertaining thereto) legal, valid and binding obligations of the Company, enforceable in accordance with their terms, subject to bankruptcy, insolvency, reorganization and other laws of general applicability relating to or affecting the enforcement of creditors' rights and to general equity principles; (d) that the Company has the corporate power to issue such Securities and Coupons, if any, and has duly taken all necessary corporate action with respect to such issuance; (e) that the issuance of such Securities and Coupons, if any, will not contravene the charter or by-laws of the Company or result in any violation of any of the terms or provisions of any law or regulation or of any indenture, mortgage or other agreement known to such Counsel by which the Company or any of its subsidiaries is bound; and (f) that all laws and requirements in respect of the execution and delivery by the Company of such Securities and Coupons, if any, and the related supplemental indenture, if any, have been complied with and that authentication and delivery of such Securities and Coupons, if any, and the execution and delivery of the related supplemental indenture, if any, by the Trustee will not violate the terms of the Indenture. The Trustee shall have the right to decline to authenticate and deliver any Securities together with any Coupons appertaining thereto under this Section if the Trustee, being advised by counsel, determines that such action may not lawfully be taken or if the Trustee in good faith by its Board of Directors or trustees, executive committee, or a trust committee of directors or trustees and/or vice presidents shall determine that such action would expose the Trustee to personal liability to existing Holders. Each Registered Security shall be dated the date of its authentication. Each Unregistered Security of any series shall be dated the date of its authentication, except as otherwise provided pursuant to sec. 3.01 with respect to the Securities of such series. 32 22 sec. 3.04. Execution of Securities and Coupons. The Securities and the Coupons, if any, appertaining thereto shall be signed in the name and on behalf of the Company by the manual or facsimile signatures of the Chairman of the Board, any Vice Chairman, the President or any Vice President and additionally, in the case of each Security, under its corporate seal (which may be printed, engraved or otherwise reproduced thereon, by facsimile or otherwise) and attested to by the Secretary or any Assistant Secretary, the signatures of whom may be manual or facsimile. No Security or Coupon appertaining thereto shall be entitled to the benefits of this Indenture or be valid or obligatory for any purpose, unless there appears on such Security a certificate of authentication substantially in the form hereinbefore recited, executed by or on behalf of the Trustee by manual signature. Such certificate by or on behalf of the Trustee upon any Security executed by the Company shall be conclusive evidence that the Security so authenticated has been duly authenticated and delivered hereunder and that the Holder is entitled to the benefits of this Indenture. In case any officer of the Company who shall have signed any of the Securities or Coupons, if any, shall cease to be such officer before the Securities or Coupons, if any, so signed shall have been authenticated (in the case of the Securities) and delivered by or on behalf of the Trustee, or disposed of by the Company, such Securities and Coupons, if any, appertaining thereto nevertheless may be authenticated (in the case of the Securities) and delivered or disposed of as though the person who signed such Securities or Coupons, if any, had not ceased to be such officer of the Company; and any Security or Coupon, if any, may be signed on behalf of the Company by such persons as, at the actual date of the execution of such Security or Coupon, if any, shall be the proper officers of the Company, although at the date of the execution of this Indenture any such person was not such an officer. The Trustee shall not authenticate or deliver any Coupon Security until any matured Coupons appertaining thereto have been detached and cancelled, except as otherwise provided or permitted by this Indenture. sec. 3.05. Registration; Registration of Transfer and Exchange. Subject to the conditions set forth below and to sec. 2.04, Securities of any series may be exchanged for a like aggregate principal amount of Securities of the same series and having the same terms of other authorized denominations. Securities to be exchanged shall be surrendered together, in the case of Coupon Securities, with all unmatured Coupons and matured Coupons in default appertaining thereto, at the offices or agencies to be maintained by the Company for such purposes as provided in sec. 6.02(1), and the Company shall execute and register and the Trustee or any Authenticating Agent shall 33 23 authenticate and deliver in exchange therefor the Security or Securities which the Holder making the exchange shall be entitled to receive. The Company shall keep or cause to be kept, at one of said offices or agencies, a register for each series of Securities issued hereunder which may include Registered Securities (hereinafter collectively referred to as the "Securities Register") in which, subject to such reasonable regulations as it may prescribe, the Company shall provide for the registration of Registered Securities of such series and shall register the transfer of Registered Securities of such series as in this Article Three provided. The Securities Register shall be in written form or in any other form capable of being converted into written form within a reasonable time. The Trustee and the Authenticating Agent are hereby appointed "Securities Registrars" for the purpose of registering Registered Securities and registering transfers of Registered Securities as herein provided. Upon due presentment for registration of transfer of any Security of any series at any such office or agency, the Company shall execute and register and the Trustee or any Authenticating Agent shall authenticate and deliver in the name of the transferee or transferees a new Registered Security or Securities of the same series for an equal aggregate principal amount. At the option of the Holder thereof, Securities of any series, whether Registered Securities or Unregistered Securities, which by their terms are registrable as to principal only or as to principal and interest, may, to the extent and under the circumstances specified pursuant to sec. 3.01, be exchanged for such Registered Securities with Coupons or Fully Registered Securities of such series, as may be issued by the terms thereof. Securities of any series, whether Registered Securities or Unregistered Securities, which by their terms provide for the issuance of Unregistered Securities, may not, except to the extent and under the circumstances specified pursuant to sec. 3.01, be exchanged for Unregistered Securities of such series. Securities so issued in exchange for other Securities shall be of like Stated Maturity. Unregistered Securities of any series issued in exchange for Registered Securities of such series between the record date for such Registered Securities and the next Interest Payment Date will be issued without the Coupon relating to such Interest Payment Date, and Unregistered Securities surrendered in exchange for Registered Securities between such dates shall be surrendered without the Coupon relating to such Interest Payment Date. Upon presentation for registration of any Unregistered Security of any series which by its terms is registrable as to principal, at the office or agency of the Company to be maintained as provided in sec. 6.02(1), such Security shall be registered as to principal in the name of the Holder thereof, and such registration shall be noted on such Security. Any Security so registered shall be 34 24 transferable on the Securities Register of the Company upon presentation of such Security at such office or agency for similar notation thereon, but, to the extent permitted by law, such Security may be discharged from registration by being in a like manner transferred to bearer, whereupon transferability by delivery shall be restored. To the extent permitted by law, Unregistered Securities shall continue to be subject to successive registrations and discharges from registration at the option of the Holders thereof. Unregistered Securities and Coupons shall be transferred by delivery. All Securities presented for registration of transfer or for exchange, redemption or payment shall (if so required by the Company or the Securities Registrar) be duly endorsed by, or be accompanied by a written instrument or instruments of transfer in form satisfactory to the Company and the Securities Registrar duly executed by, the Holder thereof or his attorney duly authorized in writing. Each Security issued upon registration of transfer or exchange of Securities pursuant to this sec. 3.05 shall be the valid obligation of the Company, evidencing the same indebtedness and entitled to the same benefits under this Indenture as the Security or Securities surrendered upon registration of such transfer or exchange. 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 sec. 3.07, sec. 4.03, or sec. 12.04 not involving any transfer. The Company shall not be required (a) to issue, exchange or register the transfer of any Securities of any series during a period beginning at the opening of business 15 days before the day of the mailing of a notice of redemption of Securities of such series and ending at the close of business on the day of such mailing, or (b) to exchange or register the transfer of any Securities selected, called or being called for redemption except, in the case of any Security to be redeemed in part, the portion thereof not to be so redeemed. None of the Company, the Trustee, any Paying Agent or the Securities Registrar will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests in a Global Security or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests. sec. 3.06. Mutilated, Destroyed, Lost or Stolen Securities or Coupons. In case any temporary or definitive Security or Coupon shall become mutilated or be destroyed, lost or stolen, and in the absence of notice to the Company or the 35 25 Trustee that such Security or Coupon has been acquired by a bona fide purchaser, the Company in the case of a mutilated Security or Coupon shall, and in the case of a lost, stolen or destroyed Security or Coupon may in its discretion, execute, and upon a Company Request the Trustee shall authenticate and deliver, or cause to be authenticated and delivered, a new Security (with Coupons, if any, attached to the mutilated, destroyed, lost or stolen Security so that neither gain or loss in interest shall result) of the same series, tenor and principal amount, bearing a number, letter or other distinguishing symbol not contemporaneously outstanding, or a new Coupon, as appropriate, in exchange and substitution for the mutilated Security or Coupon, or in lieu of and in substitution for the Security or Coupon so destroyed, lost or stolen, or if any such Security or Coupon shall have matured or shall be about to mature, instead of issuing a substituted Security or Coupon, the Company may pay or authorize the payment of the same without surrender thereof (except in the case of a mutilated Security or Coupon); provided, however, that interest represented by Coupons shall be payable only upon presentation and surrender of those Coupons at an office or agency located outside of the United States, unless otherwise provided pursuant to sec. 3.01. In every case the applicant for a substituted Security or Coupon shall furnish to the Company and to the Trustee such security or indemnity as may be required by them to save each of them harmless, and, in every case of destruction, loss or theft, the applicant shall also furnish to the Company and to the Trustee evidence to their satisfaction of the destruction, loss or theft of such Security or Coupon and of the ownership thereof. Upon the issuance of any substituted Security or Coupon under this sec. 3.06, 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 and any Authenticating Agent) connected therewith. Every substituted Security or Coupon issued pursuant to the provisions of this sec. 3.06 by virtue of the fact that any Security is destroyed, lost or stolen shall constitute an additional contractual obligation of the Company, whether or not the destroyed, lost or stolen Security or Coupon shall be at any time enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Securities and Coupons of the same series duly issued hereunder. All Securities and Coupons shall be held and owned upon the express condition that the foregoing provisions of this sec. 3.06 are exclusive with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities and Coupons and shall preclude (to the extent lawful) any and all other rights or remedies with respect to the 36 26 replacement or payment of negotiable instruments or other securities without their surrender. sec. 3.07. Temporary Securities. Pending the preparation of definitive Securities of any series the Company may execute and the Trustee shall authenticate and deliver temporary Securities (printed, lithographed or typewritten). Temporary Securities shall be issuable in any authorized denomination and substantially in the form of the definitive Securities in lieu of which they are issued but with such omissions, insertions and variations as may be appropriate for temporary Securities, all as may be determined by the Company. Every such temporary Security shall be executed by the Company and shall be authenticated by the Trustee upon the same conditions and in substantially the same manner, and with the same effect, as the definitive Securities in lieu of which they are issued. Temporary Securities may be issued as Registered Securities or Unregistered Securities, with or without one or more Coupons attached. Without unreasonable delay the Company will execute and deliver to the Trustee definitive Securities of such series and thereupon any or all temporary Securities of such series may be surrendered in exchange therefor, at the Corporate Trust Office of the Trustee, or, in the case of temporary Securities issued in respect of Unregistered Securities of any series, at the corporate trust office of the Trustee located in a city specified elsewhere in this Indenture or pursuant to sec. 3.01, and the Trustee shall authenticate and deliver in exchange for such temporary Securities an equal aggregate principal amount of definitive Securities of the same series with appropriate Coupons, if any, attached. Such exchange shall be made by the Company at its own expense and without any charge therefor except that in case of any such exchange involving any registration of transfer the Company may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto. Until so exchanged, the temporary Securities of any series shall in all respects be entitled to the same benefits under this Indenture as definitive Securities of such series authenticated and delivered hereunder. sec. 3.08. Payment of Interest; Interest Rights Preserved. The Holder of any Fully Registered Securities at the close of business on any record date with respect to any Interest Payment Date shall be entitled to receive the interest, if any, payable on such Interest Payment Date notwithstanding the cancellation of such Securities upon any transfer or exchange subsequent to the record date and prior to such Interest Payment Date. In the case of Coupon Securities, the Holder of any Coupon shall be entitled to receive the interest, if any, payable on such Interest Payment Date, upon surrender on such Interest Payment Date of the Coupon appertaining thereto in respect of such interest. Except as 37 27 otherwise specified as contemplated by sec. 3.01, for Fully Registered Securities of a particular series the term "record date" as used in this sec. 3.08 with respect to any Interest Payment Date shall mean the close of business on the last day of the calendar month preceding such Interest Payment Date if such Interest Payment Date is the fifteenth day of a calendar month and shall mean the close of business on the fifteenth day of the calendar month preceding such Interest Payment Date if such Interest Payment Date is the first day of a calendar month, whether or not such day shall be a New York Business Day. If and to the extent the Company shall default in the payment of the interest due on such Interest Payment Date, in respect of any Fully Registered Securities such defaulted interest shall be paid by the Company, at its election in each case, as provided in clause (1) or (2) below: (1) The Company may make payment of any defaulted interest to the Holder of Fully Registered Securities at the close of business on a subsequent record date established by notice given by mail by or on behalf of the Company to such Holder not less than 15 days preceding such subsequent record date, such record date to be not less than ten days preceding the date of payment of such defaulted interest. (2) The Company may make payment of any defaulted interest on the Fully Registered Securities of any series in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities of such series 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. Any defaulted interest payable in respect of a Coupon Security of any series shall be payable pursuant to such procedures as may be satisfactory to the Trustee in such manner that there is no discrimination between the Holders of Fully Registered Securities and Coupon Securities of such series, and notice of the payment date therefor shall be given by the Trustee, in the name and at the expense of the Company, in the manner provided in sec. 14.03. Subject to the foregoing provisions of this sec. 3.08, each Security delivered under this Indenture upon registration of transfer of or in exchange for or in lieu of any other Security shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Security. sec. 3.09. Cancellation. All Securities surrendered for the purpose of payment, redemption, exchange or registration of transfer or for credit against any sinking fund, and all Coupons surrendered for payment or exchange, shall, if 38 28 surrendered to the Company or any Paying Agent or any Securities Registrar, be surrendered to the Trustee and promptly cancelled by it, or, if surrendered to the Trustee, shall be promptly cancelled by it, and no Securities or Coupons shall be issued in lieu thereof except as expressly permitted by any of the provisions of this Indenture. The Trustee may destroy cancelled Securities and Coupons and deliver a certificate of such destruction to the Company or, at the written request of the Company, shall deliver such cancelled Securities and Coupons to the Company. If the Company shall acquire any of the Securities, however, such acquisition shall not operate as a redemption or satisfaction of the indebtedness represented by such Securities or Coupons unless and until the same are surrendered to the Trustee for cancellation. sec. 3.10. Computation of Interest. Except as otherwise specified as contemplated by sec. 3.01 for Securities of any series, interest on the Securities of each series shall be computed on the basis of a 360-day year of twelve 30-day months. sec. 3.11. Currency and Manner of Payments in Respect of Securities. (a) With respect to Registered Securities of any series denominated in Dollars or Foreign Currency and with respect to Registered Securities of any series denominated in any currency unit, including, without limitation, ECU with respect to which the Holders of Securities of such series have not made the election provided for in paragraph (b) below, the following payment provisions shall apply: (1) Except as provided in subparagraph (a)(2) or in paragraph (e) below, payment of the principal of and premium, if any, on any Registered Security will be made at the Place of Payment by delivery of a check in the currency or currency unit in which the Security is payable on the payment date against surrender of such Registered Security, and any interest on any Fully Registered Security will be paid at the Place of Payment by mailing a check in the currency or currency unit in which such interest is payable to the Person entitled thereto at the address of such Person appearing on the Securities Register. (2) Payment of the principal of, premium, if any, and (with respect to Fully Registered Securities only) interest on such Security may also, subject to applicable laws and regulations, be made at such other place or places as may be designated by the Company by any appropriate method. (b) With respect to Registered Securities of any series denominated in any currency unit, including, without limitation, ECU, the following payment 39 29 provisions shall apply, except as otherwise provided in paragraphs (e) and (f) below: (1) It may be provided pursuant to sec. 3.01 with respect to the Securities of such series that Holders shall have the option to receive payments of principal of, premium, if any, and (with respect to Fully Registered Securities only) interest, if any, on such Securities in any of the currencies which may be designated for such election in such Securities by delivering to the Trustee a written election, to be in form and substance satisfactory to the Trustee, not later than the close of business on the record date immediately preceding the applicable payment date. Such election will remain in effect for such Holder until changed by the Holder by written notice to the Trustee (but any such change must be made not later than the close of business on the record date immediately preceding the next payment date to be effective for the payment to be made on such payment date and no such change may be made with respect to payments to be made on any Security of such series with respect to which notice of redemption has been given by the Company pursuant to Article Four). Any Holder of any such Security who shall not have delivered any such election to the Trustee not later than the close of business on the applicable record date will be paid the amount due on the applicable payment date in the relevant currency unit as provided in paragraph (a) of this sec. 3.11. Payment of principal of and premium, if any, shall be made on the payment date against surrender of such Security. Payment of principal of, premium, if any, and (with respect to Fully Registered Securities only) interest, if any, shall be made at the Place of Payment by mailing at such location a check, in the applicable currency or currency unit to the Person entitled thereto at the address of such Person appearing on the Securities Register. (2) Payment of the principal of, premium, if any, and (with respect to Fully Registered Securities only) interest, if any, on such Security may also, subject to applicable laws and regulations, be made at such other place or places as may be designated by the Company by any appropriate method. (c) Payment of the principal of and premium, if any, on any Unregistered Security and of interest on any Coupon Security will be made unless otherwise specified pursuant to sec. 3.01 or sec. 12.01(e) at such place or places outside the United States as may be designated by the Company pursuant to any applicable laws or regulations by any appropriate method in the currency or currency unit in which the Security is payable (except as provided in paragraph 40 30 (e) below) on the payment date against surrender of the Unregistered Security, in the case of payment of principal and premium, if any, or the relevant Coupon, in the case of payment of interest, if any. Except as provided in paragraph (e) below, payment with respect to Unregistered Securities and Coupons will be made by check, subject to any limitations on the methods of effecting such payment as shall be specified in the terms of the Security established as provided in sec. 3.01 and sec. 12.01(e) and as shall be required under applicable laws and regulations. (d) Not later than the fourth Business Day after the record date for each payment date, the Trustee will deliver to the Company a written notice specifying, in the currency or currency unit in which each series of the Securities are payable, the respective aggregate amounts of principal of, premium, if any, and interest, if any, on the Securities to be made on such payment date, specifying the amounts so payable in respect of Fully Registered Securities, Registered Securities with Coupons and Unregistered Securities and in respect of the Registered Securities as to which the Holders of Securities denominated in any currency unit shall have elected to be paid in another currency as provided in paragraph (b) above. If the election referred to in paragraph (b) above has been provided for pursuant to sec. 3.01 and if at least one Holder has made such election, then, not later than the eighth Business Day following each record date the Company will deliver to the Trustee an Exchange Rate Officer's Certificate in respect of the Dollar or Foreign Currency payments to be made on such payment date. The Dollar or Foreign Currency amount receivable by Holders of Registered Securities denominated in a currency unit who have elected payment in such currency as provided in paragraph (b) above shall be determined by the Company on the basis of the applicable Official Currency Unit Exchange Rate set forth in the applicable Exchange Rate Officer's Certificate. (e) If a Foreign Currency in which any of the Securities are denominated or payable ceases to be used both by the government of the country which issued such currency and for the settlement of transactions by public institutions of or within the international banking community, or if the ECU ceases to be used both within the European Monetary System and for the settlement of transactions by public institutions of or within the European Communities, or if any other currency unit in which a Security is denominated or payable ceases to be used for the purposes for which it was established, then with respect to each date for the payment of principal of, premium, if any, and interest, if any, on the applicable Securities denominated or payable in such Foreign Currency, the ECU or such other currency unit occurring after the last date on which such Foreign Currency, the ECU or such other currency unit was so used (the 41 31 "Conversion Date"), the Dollar shall be the currency of payment for use on each such payment date. The Dollar amount to be paid by the Company to the Trustee and by the Trustee or any Paying Agent to the Holders of such Securities with respect to such payment date shall be the Dollar Equivalent of the Foreign Currency or, in the case of a currency unit, the Dollar Equivalent of the Currency Unit as determined by the Trustee or the Dollar Determination Agent, if any, as of the record date (the "Valuation Date") in the manner provided in paragraphs (g) or (h) below. (f) If the Holder of a Registered Security denominated in a currency unit elects payment in a specified Foreign Currency as provided for by paragraph (b) and such Foreign Currency ceases to be used both by the government of the country which issued such currency and for the settlement of transactions by public institutions of or within the international banking community, such Holder shall receive payment in such currency unit, and if ECU ceases to be used both within the European Monetary System and for the settlement of transactions by public institutions of or within the European Communities, or if any other such currency unit ceases to be used for the purposes for which it was established, such Holder shall receive payment in Dollars. (g) The "Dollar Equivalent of the Foreign Currency" shall be determined by the Trustee or the Dollar Determination Agent, if any, as of each Valuation Date and shall be obtained by converting the specified Foreign Currency into Dollars at the Market Exchange Rate on the Valuation Date. (h) The "Dollar Equivalent of the Currency Unit" shall be determined by the Trustee or the Dollar Determination Agent, if any, as of each Valuation Date and shall be the sum obtained by adding together the results obtained by converting the Specified Amount of each Component Currency into Dollars at the Market Exchange Rate on the Valuation Date for such Component Currency. (i) For purposes of this sec. 3.11 the following terms shall have the following meanings: A "Component Currency" shall mean any currency which, on the Conversion Date, was a component currency of the relevant currency unit, including, but not limited to, the ECU. A "Specified Amount" of a Component Currency shall mean the number of units or fractions thereof which such Component Currency represented in the relevant currency unit, including, but not limited to, the ECU, on the Conversion Date. If after the Conversion Date the official unit of any Component Currency is altered by way of combination or subdivision, the 42 32 Specified Amount of such Component Currency shall be divided or multiplied in the same proportion. If after the Conversion Date two or more Component Currencies are consolidated into a single currency, the respective Specified Amounts of such Component Currencies shall be replaced by an amount in such single currency equal to the sum of the respective Specified Amounts of such consolidated Component Currencies expressed in such single currency, and such amount shall thereafter be a Specified Amount and such single currency shall thereafter be a Component Currency. If after the Conversion Date any Component Currency shall be divided into two or more currencies, the Specified Amount of such Component Currency shall be replaced by specified amounts of such two or more currencies, the sum of which, at the Market Exchange Rate of such two or more currencies on the date of such replacement, shall be equal to the Specified Amount of such former Component Currency divided by the number of currencies into which such Component Currency was divided, and such amounts shall thereafter be Specified Amounts and such currencies shall thereafter be Component Currencies. "Market Exchange Rate" shall mean for any currency the noon Dollar buying rate for that currency for cable transfers quoted in New York City on the Valuation Date as certified for customs purposes by the Federal Reserve Bank of New York. If such rates are not available for any reason with respect to one or more currencies for which an Exchange Rate is required, the Trustee or the Dollar Determination Agent, if any, shall use, in its sole discretion and without liability on its part, such quotation of the Federal Reserve Bank of New York as of the most recent available date, or quotations from one or more major banks in New York City or in the country of issue of the currency in question, or such other quotations as the Trustee or the Dollar Determination Agent, if any, shall deem appropriate. Unless otherwise specified by the Trustee or the Dollar Determination Agent, if any, if there is more than one market for dealing in any currency by reason of foreign exchange regulations or otherwise, the market to be used in respect of such currency shall be that upon which a nonresident issuer of securities designated in such currency would purchase such currency in order to make payments in respect of such securities. All decisions and determinations of the Trustee or the Dollar Determination Agent, if any, regarding the Dollar Equivalent of the Foreign Currency, the Dollar Equivalent of the Currency Unit and the Market Exchange Rate shall be in its sole discretion and shall, in the absence of manifest error, be conclusive for all purposes and irrevocably binding upon the Company and all Holders of the Securities and Coupons, denominated or payable in the relevant currency or currency units. In the event that a Foreign Currency ceases to be 43 33 used both by the government of the country which issued such currency and for the settlement of transactions by public institutions of or within the international banking community, the Company, after learning thereof, will immediately give notice thereof to the Trustee (and the Trustee will promptly thereafter give notice in the manner provided in sec. 14.03 to the Holders) specifying the Conversion Date. In the event the ECU ceases to be used both within the European Monetary System and for the settlement of transactions by public institutions of or within the European Communities, or any other currency unit in which Securities or Coupons are denominated or payable, ceases to be used for the purposes for which it was established, the Company, after learning thereof, will immediately give notice thereof to the Trustee (and the Trustee will promptly thereafter give notice in the manner provided in sec. 14.03 to the Holders) specifying the Conversion Date and the Specified Amount of each Component Currency on the Conversion Date. In the event of any subsequent change in any Component Currency as set forth in the definition of Specified Amount above, the Company, after learning thereof, will similarly give notice to the Trustee. The Trustee shall be fully justified and protected in relying and acting upon information received by it from the Company and the Dollar Determination Agent, if any, and shall not otherwise have any duty or obligation to determine such information independently. sec. 3.12 Compliance with Certain Laws and Regulations. If any Unregistered Securities or Coupon Securities are to be issued in any series of Securities, the Company will use reasonable efforts to provide for arrangements and procedures designed pursuant to then applicable laws and regulations, if any, to ensure that such Unregistered Securities or Coupon Securities are sold or resold, exchanged, transferred and paid only in compliance with such laws and regulations and without adverse consequences to the Company. ARTICLE FOUR. REDEMPTION OF SECURITIES. sec. 4.01. Applicability of Article. The provisions of this Article shall be applicable to the Securities of any series which are redeemable before their maturity except as otherwise specified as contemplated by sec. 3.01 for Securities of such series. sec. 4.02. Notice of Redemption; Selection of Securities. In case the Company shall desire to exercise the right to redeem all, or, as the case may be, any part of the Securities of any series (or all or any part of the Unregistered Securities of such series or all or any part of the Registered Securities of such series, if the terms and conditions of redemption shall differ with respect to 44 34 Unregistered Securities and Registered Securities of such series as specified in the terms of such Securities established pursuant to sec. 3.01) in accordance with their terms, it shall fix a Redemption Date and shall provide notice of such redemption at least 30 and not more than 60 days prior to such Redemption Date to the Trustee and to the Holders of Securities of such series so to be redeemed as a whole or in part in the manner provided in sec. 14.03. The notice provided in the manner herein specified shall be conclusively presumed to have been duly given, whether or not the Holder receives such notice. In any case, failure to give such notice or any defect in the notice to the Holder of any Security of a series designated for redemption as a whole or in part shall not affect the validity of the proceedings for the redemption of any other Security of such series. Each such notice of redemption shall specify the Redemption Date, the Redemption Price, the Place or Places of Payment, that the Securities of such series are being redeemed at the option of the Company pursuant to provisions contained in the terms of the Securities of such series or in a supplemental indenture establishing such series, if such be the case, together with a brief statement of the facts permitting such redemption, that payment will be made upon presentation and surrender of the applicable Securities, that, unless otherwise specified in such notice, Coupon Securities of any series, if any, surrendered for payment must be accompanied by all Coupons, if any, maturing subsequent to the date fixed for redemption, failing which the amount of any such missing Coupon or Coupons will be deducted from the sum due for payment, that any interest accrued to the Redemption Date will be paid as specified in said notice, and that on and after said Date any interest thereon or on the portions thereof to be redeemed will cease to accrue. If less than all the Securities of any series are to be redeemed the notice of redemption shall specify the numbers of the Securities of such series to be redeemed, and, if only Unregistered Securities of any series are to be redeemed, and if such Unregistered Securities may be exchanged for Registered Securities, the last date on which exchanges of Unregistered Securities for Registered Securities not subject to redemption may be made. In case any Security of any series is to be redeemed in part only, the notice of redemption shall state the portion of the principal amount thereof to be redeemed and shall state that on and after the Redemption Date, upon surrender of such Security and any Coupons appertaining thereto, a new Security or Securities of such series in principal amount equal to the unredeemed portion thereof and with appropriate Coupons will be issued, or, in the case of Securities providing appropriate space for such notation, at the option of the Holders the Trustee, in 45 35 lieu of delivering a new Security or Securities as aforesaid, may make a notation on such Security of the payment of the redeemed portion thereof. On or before (but at least one New York Business Day before, in the case of payments made in a currency or currency unit other than Dollars) the Redemption Date with respect to the Securities of any series stated in the notice of redemption given as provided in this sec. 4.02, the Company will deposit with the Trustee or with one or more Paying Agents an amount of money in the currency or currency unit in which the Securities of such series and any Coupons appertaining thereto are payable (except as otherwise specified as contemplated by sec. 3.01 for the Securities of such series and except as provided in sec.sec. 3.11(b), 3.11(e) and 3.11(f) of this Indenture) sufficient to redeem on such Redemption Date all the Securities or portions thereof so called for redemption at the applicable Redemption Price, together with accrued interest to such Redemption Date. If the Company is acting as its own Paying Agent, it will segregate such amount and hold it in trust as provided in sec. 6.02 (10). If fewer than all the Securities of a series are to be redeemed (except in the case of a redemption in whole of the Unregistered Securities, the Coupon Securities, the Registered Securities or the Fully Registered Securities of such series), the Company will give the Trustee written notice not less than 45 days prior to the Redemption Date as to the aggregate principal amount of Securities to be redeemed and the Trustee shall select, not more than 60 days prior to the Redemption Date and in such manner as in its sole discretion it shall deem appropriate and fair, the Securities of such series or portions thereof (in multiples of 1,000 in the currency or currency unit in which the Securities of such series are denominated, except as otherwise set forth in the applicable form of Security) to be redeemed. sec. 4.03. Payment of Securities Called for Redemption. If notice of redemption has been given as provided in sec. 4.02 or sec. 5.03, the Securities or portions of Securities of the series with respect to which such notice has been given shall become due and payable on the Redemption Date and at the place or places stated in such notice at the applicable Redemption Price, together with any interest accrued to such Redemption Date, and on and after said Redemption Date (unless the Company shall default in the payment of such Securities at the applicable Redemption Price, together with any interest accrued to said Redemption Date) any interest on the Securities or portions of Securities of any series so called for redemption shall cease to accrue. On presentation and surrender of such Securities and all Coupons, if any, appertaining thereto at a Place of Payment in such notice specified, such Securities and Coupons or the specified portions thereof shall be paid and redeemed by the Company at the applicable Redemption Price, together with any interest 46 36 accrued thereon to the applicable Redemption Date in the currency or currency unit in which the Securities of such series and the Coupons, if any, appertaining thereto are payable (except as otherwise specified as contemplated by sec. 3.01 for the Securities of such series and except as provided in sec.sec. 3.11(b), 3.11(e) and 3.11(f) of this Indenture). If any Coupon Security surrendered for redemption shall not be accompanied by all appurtenant Coupons maturing on or 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, unless otherwise provided pursuant to sec. 3.01 or sec. 12.01(e), interest represented by Coupons shall be payable only upon presentation and surrender of those Coupons at an office or agency located outside of the United States. Upon presentation of any Security redeemed in part only and the Coupons, if any, appertaining thereto, the Company shall execute and the Trustee shall authenticate and deliver to the Holder thereof, at the expense of the Company, a new Security or Securities of the same series and the Coupons, if any, appertaining thereto, of authorized denominations, in aggregate principal amount equal to the unredeemed portion of the Security so presented. ARTICLE FIVE. SINKING FUNDS. sec. 5.01. Applicability of Article. The provisions of this Article shall be applicable to any sinking fund for the retirement of Securities of a series except as otherwise specified as contemplated by sec. 3.01 for Securities of such series. The minimum amount of any sinking fund payment provided for by the terms of Securities of any series is herein referred to as a "mandatory sinking fund payment", and any payment in excess of such minimum amount provided for by the terms of Securities of any series is herein referred to as an "optional sinking fund payment". sec. 5.02. Satisfaction of Mandatory Sinking Fund Payments with Securities. In lieu of making all or any part of any mandatory sinking fund payment 47 37 with respect to any Securities of a series in cash, the Company may at its option, at any time no more than sixteen months and no less than 45 days prior to the date on which such sinking fund payment is due, deliver to the Trustee Securities of such series (together with the unmatured Coupons, if any, appertaining thereto) theretofore purchased or otherwise acquired by the Company, except Securities of such series which have been redeemed through the application of mandatory or optional sinking fund payments pursuant to the terms of the Securities of such series, accompanied by a Company Order instructing the Trustee to credit such obligations and stating that the Securities of such series were originally issued by the Company by way of bona fide sale or other negotiation for value; provided that such Securities have not been previously so credited. Such Securities shall be received and credited for such purpose by the Trustee at the Redemption Price specified in such Securities for redemption through operation of the sinking fund and the amount of such mandatory sinking fund payment shall be reduced accordingly. sec. 5.03. Redemption of Securities for Sinking Fund. Not less than 60 days prior to each sinking fund payment date for any series of Securities, the Company will deliver to the Trustee a certificate signed by the Treasurer or any Assistant Treasurer of the Company specifying the amount of the next ensuing sinking fund payment for such series pursuant to the terms of such series, the portion thereof, if any, which is to be satisfied by payment of cash in the currency or currency unit in which the Securities of such series and the Coupons, if any, appertaining thereto, are payable (except as otherwise specified as contemplated by sec. 3.01 for the Securities of such series and except as provided in sec.sec. 3.11(b), 3.11(e) and 3.11(f) of this Indenture) and the portion thereof, if any, which is to be satisfied by delivering and crediting Securities of such series pursuant to sec. 5.02 and whether the Company intends to exercise its rights to make a permitted optional sinking fund payment with respect to such series. Such certificate shall be irrevocable and upon its delivery the Company shall be obligated to make the cash payment or payments (in the currency or currency unit described above) therein referred to, if any, on or before the next succeeding sinking fund payment date. In the case of the failure of the Company to deliver such certificate (or to deliver the Securities and Coupons, if any, specified in such certificate within the time period specified in sec. 5.02), the sinking fund payment due on the next succeeding sinking fund payment date for such series shall be paid entirely in cash (in the currency or currency unit described above) and shall be sufficient to redeem the principal amount of the Securities of such series subject to a mandatory sinking fund payment without the right to deliver or credit Securities as 48 38 provided in sec. 5.02 and without the right to make any optional sinking fund payment, if any, with respect to such series. Any sinking fund payment or payments (mandatory or optional) made in cash (in the currency or currency unit described above) plus any unused balance of any preceding sinking fund payments made with respect to the Securities of any particular series shall be applied by the Trustee (or by the Company if the Company is acting as its own Paying Agent) on the sinking fund payment date on which such payment is made (or, if such payment is made before a sinking fund payment date, on the sinking fund payment date following the date of such payment) to the redemption of Securities of such series at the Redemption Price specified in such Securities with respect to the sinking fund together with accrued interest, if any, to the applicable Redemption Date. Any sinking fund moneys not so applied or allocated by the Trustee (or by the Company if the Company is acting as its own Paying Agent) to the redemption of Securities shall be added to the next sinking fund payment received by the Trustee (or if the Company is acting as its own Paying Agent, segregated and held in trust as provided in sec. 6.02(10)) for such series and, together with such payment (or such amount so segregated) shall be applied in accordance with the provisions of this sec. 5.03. Any and all sinking fund moneys with respect to the Securities of any particular series held by the Trustee (or if the Company is acting as its own Paying Agent, segregated and held in trust as provided in sec. 6.02(10)) on the last sinking fund payment date with respect to Securities of such series and not held for the payment of redemption of particular Securities of such series shall be applied by the Trustee (or by the Company if the Company is acting as its own Paying Agent), together with other moneys, if necessary, to be deposited (or segregated) sufficient for the purpose, to the payment of the principal of the Securities of such series at Maturity. The Trustee shall not convert any currency or currency unit in which the Securities of such series are payable for the purposes of such sinking fund application unless specifically requested to do so by the Company, and any such conversion agreed to by the Trustee in response to such request shall be for the account and at the expense of the Company and shall not affect the Company's obligation to pay the Holders in the currency or currency unit to which such Holder may be entitled. The Trustee shall select or cause to be selected the Securities to be redeemed upon such sinking fund payment date in the manner specified in the last paragraph of sec. 4.02 and the Company shall cause notice of the redemption thereof to be given in the manner provided in sec. 4.02 except that the notice of redemption shall also state that the Securities are being redeemed by operation of the sinking fund and whether the sinking fund payment is mandatory or 49 39 optional, or both, as the case may be. Such notice having been duly given, the redemption of such Securities shall be made upon the terms and in the manner stated in sec. 4.03. On or before (but at least one New York Business Day before, in the case of payments made in a currency or currency unit other than Dollars) each sinking fund payment date, the Company shall pay to the Trustee (or, if the Company is acting as its own Paying Agent, will segregate and hold in trust as provided in sec. 6.02(10)) in cash (in the currency or currency unit described in the first paragraph of this sec. 5.03) a sum equal to the principal and any interest accrued to the Redemption Date for Securities or portions thereof to be redeemed on such sinking fund payment date pursuant to this Section. Neither the Trustee nor the Company shall redeem any Securities of a series with sinking fund moneys or mail any notice of redemption of Securities of such series by operation of the sinking fund for such series during the continuance of a default in payment of interest, if any, on any Securities of such series or of any Event of Default (other than an Event of Default occurring as a consequence of this paragraph) with respect to the Securities of such series, except that if the notice of redemption shall have been provided in accordance with the provisions hereof, the Trustee (or the Company if the Company is acting as its own Paying Agent) shall redeem such Securities if cash (in currency or currency unit described in the first paragraph of this sec. 5.03) sufficient for that purpose shall be deposited with the Trustee (or segregated by the Company) for that purpose in accordance with the terms of this Article. Except as aforesaid, any moneys (in the currency or currency unit described in the first paragraph of this sec. 5.03) in the sinking fund for such series at the time when any such default or Event of Default shall occur and any moneys (in the currency or currency unit described in the first paragraph of this sec. 5.03) thereafter paid into such sinking fund shall, during the continuance of such default or Event of Default, be held as security for the payment of the Securities of such series and the Coupons, if any, appertaining thereto; provided, however, that in case such Event of Default or default shall have been cured or waived as provided herein, such moneys (in the currency or currency unit described in the first paragraph of this sec. 5.03) shall thereafter be applied on the next sinking fund payment date for the Securities of such series on which such moneys (in the currency or currency unit described in the first paragraph of this sec. 5.03) may be applied pursuant to the provisions of this Section. 50 40 ARTICLE SIX. CERTAIN COVENANTS OF THE COMPANY. The Company covenants and agrees for the benefit of each series of Securities that on and after the date of execution of this Indenture and so long as any of the Securities of such series remain outstanding: sec. 6.01. Payment of Securities. The Company will duly and punctually pay or cause to be paid (in the currency or currency unit in which the Securities of such series and Coupons, if any, appertaining thereto are payable, except as otherwise specified as contemplated by sec. 3.01 for the Securities of such series and except as provided in sec.sec. 3.11(b), 3.11(e) and 3.11(f) of this Indenture) the principal of, the premium, if any, and the interest, if any, on the Securities of such series at the times and places and in the manner provided in such Securities, any Coupons appertaining thereto, and in the Indenture. The interest on Coupon Securities shall be payable only upon presentation and surrender of the several Coupons for such interest installments as are evidenced thereby as they severally mature. The interest, if any, on any temporary Unregistered Security shall be paid, as to any installment of interest evidenced by a Coupon attached thereto, if any, only upon presentation and surrender of such Coupon, and, as to other installments of interest, if any, only upon presentation of such Security for notation thereon of the payment of such interest. sec. 6.02. Other Covenants. The Company -- Office or Agency: (1) Will maintain in the Borough of Manhattan, The City of New York, an office or agency where Registered Securities of such series may be presented or surrendered for payment, where Securities of such series may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Company in respect of the Securities of such series and this Indenture may be served, which office or agency shall initially be the Corporate Trust Office of the Trustee or, if the Corporate Trust Office of the Trustee is not located in the Borough of Manhattan, The City of New York, such office or agency shall be the principal corporate trust office of the Authenticating Agent designated pursuant to sec. 9.14 hereof. So long as any Coupon Securities or Unregistered Securities of any series remain outstanding, the Company will (except as specified pursuant to sec. 3.01 or sec. 12.01(e)) maintain one or more offices or agencies outside the United States in such city or cities as may be specified elsewhere in this Indenture or as contemplated by sec. 3.01, with respect 51 41 to such series where Coupons appertaining to Securities of such series or Unregistered Securities of such series may be surrendered or presented for payment, or surrendered for exchange pursuant to sec. 3.05 and where notices and demands to or upon the Company in respect of Coupons appertaining to Securities of such series or the Unregistered Securities of such series or of this Indenture may be served. The Company will give prompt written notice to the Trustee 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 such required office or agency or shall fail to furnish the Trustee with the address thereof, presentations, surrenders, notices and demands in respect of Registered Securities may be made or served at the Corporate Trust Office of the Trustee and the corporate trust office of any Authenticating Agent appointed hereunder, and presentations, surrenders, notices and demands in respect of Coupons appertaining to Securities of any series and Unregistered Securities may be made or served at the corporate trust office of the Trustee in the other city or cities referred to above; and the Company hereby appoints the Trustee and any Authenticating Agent appointed hereunder its agents to receive all such presentations, surrenders, notices and demands. The Company may also from time to time designate one or more other offices or agencies (in or outside The City of New York) where the Securities of such series may be presented or surrendered for any or all of such purposes, and may from time to time rescind such designation; provided, however, that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain for such purposes an office or agency in the Borough of Manhattan, The City of New York, and, except as otherwise specified pursuant to sec. 3.01 or sec. 12.01(e), so long as any Unregistered Securities or Coupon Securities remain outstanding, one or more offices or agencies outside the United States. Maintenance of Corporate Existence: (2) Will at all times take or cause to be taken all such action as may from time to time be necessary to maintain, preserve or renew its corporate existence and the corporate existence of its Subsidiaries; provided, however, that nothing in this sec. 6.02(2) shall prevent any merger or consolidation permitted by sec. 6.02(6) or any termination of the existence of any Subsidiary if such termination is, in the judgment of the Company, in the interest of the Company and not disadvantageous to the Holders of the Securities of any series. 52 42 Taxes, etc.: (3) Will promptly pay and discharge or cause to be paid and discharged all lawful taxes, assessments and governmental charges or levies imposed upon the Company or any of its Subsidiaries or upon the income or profits of the Company or any or its Subsidiaries, or upon any property, real, personal or mixed, belonging to the Company or any of its Subsidiaries, or upon any part thereof, before the same shall become in default, as well as all lawful claims for labor, materials and supplies which, if unpaid, might become a lien or charge upon such properties or any part thereof; provided, however, that the Company shall not be required to pay and discharge or cause to be paid and discharged any such tax, assessment, charge, levy or claim so long as the validity thereof shall be contested in good faith by appropriate proceedings and the Company or such Subsidiary, as the case may be, shall set aside on its books such reserves, if any, as shall be deemed by it adequate with respect to any such tax, assessment, charge, levy or claim so contested. Books of Account: (4) And its Subsidiaries will keep true books of record and account in which full, true and correct entries in accordance with sound accounting practice will be made of all dealings or transactions in relation to their respective businesses and activities. Liens, etc.: (5) Will not itself and will not permit any Finance Subsidiary or any Insurance Subsidiary to (a) create or permit to continue in existence any mortgage, pledge, encumbrance, lien, or charge of any kind upon any of its property or other assets, whether owned at the date hereof or hereafter acquired, or (b) transfer any of such property or other assets for the purpose of subjecting the same to the payment of certain obligations in priority to payment of other obligations, or (c) acquire any property or other assets upon any conditional sale, lease-purchase or other title retention agreement unless in any such case under clauses (a), (b) or (c), effective provision has been made for securing payment of the principal of, and interest on, the Securities equally and ratably with any and all other indebtedness or other obligation which is, or in any event may be, secured by such mortgage, pledge, encumbrance, lien or charge, so long as any such indebtedness or other obligations shall be so secured (it being understood that the foregoing restrictions shall not apply to any arrangement involving the transfer of property or other assets where such transfer is accounted for as a sale in accordance with generally accepted 53 43 accounting principles): provided, however, that the foregoing restrictions shall not prevent: (i) Any such Subsidiary from mortgaging or pledging all or part of its property to the Company, or to any Finance Subsidiary or Insurance Subsidiary; (ii) The Company or any such Subsidiary from creating or incurring, or suffering to exist purchase money mortgages or other purchase money liens, or conditional sale, lease-purchase, or other title retention agreements upon any physical property or physical assets hereafter acquired by the Company or such Subsidiary, or from hereafter acquiring physical property or physical assets subject to mortgages or liens existing thereon at the date of acquisition thereof, provided that no such mortgage or lien shall extend to or cover any other property of the Company or of such Subsidiary; or the Company or any such Subsidiary from replacing, extending or renewing any mortgage or lien permitted hereby upon the same property theretofore subject thereto or replacing, extending, or renewing the indebtedness secured thereby, provided that in any such case the principal amount of such indebtedness so replaced, extended or renewed shall not be increased; (iii) The Company or any such Subsidiary from acquiring a majority of the voting stock of any corporation, all or any part of the physical properties or physical assets of which at the date of acquisition of such voting stock are subject to a mortgage, pledge, or other lien; or the Company or any such Subsidiary from replacing, extending, or renewing any such mortgage, pledge, or lien permitted hereby, or replacing, extending, or renewing the indebtedness secured thereby, provided that in any such case the principal amount of such indebtedness so replaced, extended, or renewed shall not be increased; (iv) Any such Subsidiary organized under the laws of, and operating principally in, a country other than the United States of America, from creating, incurring or suffering to exist any mortgage, pledge or other lien upon any of its property of any character to secure any indebtedness for money borrowed, in an aggregate principal amount (for each such Subsidiary) which will not cause the aggregate amount of the indebtedness of such Subsidiary to exceed the value of the assets of such Subsidiary at such time; (v) Any such Subsidiary from creating, or incurring, or suffering to exist any mortgage, pledge, or other lien upon any of its property of any character to secure, in the ordinary course of business, its indebtedness for 54 44 money borrowed, if as a matter of practice, prior to the time it became a Subsidiary it had borrowed on the basis of secured loans or had customarily deposited collateral to secure any or all of its obligations; (vi) The Company or any such Subsidiary from mortgaging, entering into lease-purchase or other title retention agreements, or otherwise creating, incurring or suffering to exist liens upon, any real property acquired or constructed by the Company or any such Subsidiary primarily for use in the conduct of its business; (vii) The Company or any such Subsidiary from permitting to exist any liens or encumbrances for taxes or assessments, or other governmental charges or levies, if payment of the same is not at the time required to be made under the other terms and provisions of this Indenture; (viii) The Company or any such Subsidiary from making any deposit with or giving security to any governmental agency or quasi-governmental agency as a condition to the transaction of business or the exercise of a privilege or license, or in order to entitle the Company, or any such Subsidiary, to maintain self-insurance or to participate in any fund in connection with workmen's compensation, disability benefits, unemployment insurance, old age pensions or other types of social benefits, or to join in any other provisions or benefits available to companies participating in any such arrangements; or depositing assets with any Clerk of any Court, or any surety company, or in escrow, as collateral in connection with, or in lieu of, any bond or appeal by the Company, or any such Subsidiary, from any judgment or decree against it, or in connection with any other proceedings before any Court by or against the Company or any such Subsidiary; or (ix) The Company or any such Subsidiary from creating, permitting or suffering to exist other liens, charges and encumbrances incidental to the conduct of its business, or the ownership of its properties and other assets, and securing liabilities not incurred in connection with the borrowing of money or the obtaining of advances or credit. Notwithstanding the foregoing, the Company or any such Subsidiary may incur mortgages, pledges, encumbrances, liens or charges on indebtedness that would be otherwise prohibited under this sec. 6.02(5), if the aggregate amount of indebtedness secured by such mortgages, pledges, encumbrances, liens or charges, together with all other indebtedness of, or guaranteed by, the Company and any such Subsidiaries existing at such time and secured by mortgages, pledges, encumbrances, liens or charges not excepted by (i) through 55 45 (ix) above, does not at the time exceed 15% of the Company's Consolidated Net Worth. As used herein, "Consolidated Net Worth" shall mean the difference between the Company's consolidated assets and consolidated liabilities as shown on the Company's most recent audited consolidated financial statements prepared in accordance with United States generally accepted accounting principles. Consolidations, Mergers, etc.: (6) Will not lease, sell, transfer or otherwise dispose of all or substantially all of its assets to, or consolidate with, or merge into, any other person, firm or corporation, or permit any other person, firm or corporation to merge into the Company, unless the person, firm or corporation to which such assets shall have been leased, sold, transferred or otherwise disposed of or the corporation formed by such consolidation or the corporation into which the Company shall have been merged, as the case may be (any such person, firm or corporation, other than the Company, being herein called the "New Company"), shall be a corporation incorporated within the United States of America which shall expressly assume the due and punctual payment of the principal of, and premium, if any, and interest, if any, on all of the Securities of each series and the due and punctual performance of all of the covenants and conditions of the Indenture and the Securities of each series, and unless immediately after any such transaction, no default shall exist in the performance of any of the covenants and conditions of the Indenture or the Securities of any series, and no liens shall exist upon assets of the Company or the New Company other than as permitted by sec. 6.02(5). In case of any such consolidation, merger, sale or conveyance and upon any such assumption by the New Company, the New Company shall succeed to and be substituted for the Company, with the same effect as if it had been named herein as the party of the first part and the predecessor corporation shall be relieved of any further obligation under the Indenture. Other Instruments, etc.: (7) From time to time, upon the written request of the Trustee (which the Trustee, subject to sec. 9.01, shall be under no obligation to make), will execute, acknowledge and deliver all such further and additional instruments and take all such further action as may be reasonable or may be required to carry out the intention of the Indenture, and to provide for the payment of the Securities of each series, according to the intent and purposes expressed in the Indenture and in the Securities of such series. 56 46 Permit no Vacancy in Office of Trustee: (8) Whenever necessary to avoid or fill a vacancy in the office of the Trustee, will appoint a Trustee in the manner provided in sec. 9.10, so that there shall be at all times a Trustee with respect to each series of Securities hereunder. Agreement with Paying Agent: (9) If it shall appoint a Paying Agent other than the Trustee with respect to the Securities of any series, it will cause such Paying Agent to execute and deliver to the Trustee, an instrument in which such Paying Agent shall agree with the Trustee subject to the provisions of sec. 6.02(10), (a) that it will hold all sums held by it as such Paying Agent for the payment of the principal of, premium, if any, and interest, if any, on the Securities of such series (whether such sums have been paid to it by the Company or by any other obligor on the Securities of such series) in trust for the benefit of the Holders of the Securities of such series, and the Coupons, if any, appertaining thereto or the Trustee, (b) that it will give the Trustee notice of any default by the Company (or by any other obligor on the Securities of such series) in the making of any payment of the principal of, premium, if any, or interest, if any, on the Securities of such series when the same shall be due and payable, and (c) 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. Money for Securities Payments to be Held in Trust: (10) If it shall act as its own Paying Agent with respect to the Securities of any series, on or before the due date of the principal of, premium, if any, or interest, if any, on the Securities of such series and the Coupons, if any, appertaining thereto, will set aside, segregate and hold in trust for the benefit of the Holders of the Securities of such series and the Coupons, if any, appertaining thereto, or the Trustee, a sum (in the currency or currency unit in which the Securities of such series are denominated, except as otherwise specified as contemplated by sec. 3.01 for the Securities of such series and except as provided in sec.sec. 3.11(b), 3.11(e) and 3.11(f) of this Indenture) sufficient to pay such principal, premium, if any, or interest, if any, so becoming due and will notify the Trustee of such action, or any failure (by it or any other obligor on the 57 47 Securities of such series and the Coupons, if any, appertaining thereto) to take such action. Whenever the Company shall have one or more Paying Agents with respect to the Securities of any series, it will, prior to the due date of the principal of, premium, if any, or interest, if any, on the Securities of such series and the Coupons, if any, appertaining thereto, deposit with a designated Paying Agent a sum (in the currency or currency unit described in the preceding paragraph) sufficient to pay the principal, premium, if any, or interest, if any, so becoming due, such sum to be held in trust for the benefit of the Persons entitled to such principal, premium, if any, or interest, if any, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee at its Corporate Trust Office of its failure so to act, provided that, anything in Subdivisions (9) and (10) of this sec. 6.02 to the contrary notwithstanding, the agreement to hold sums in trust as provided therein is subject to the provisions of sec. 12.04. Financial Statements, etc.: (11) Will, beginning with the first April 30 which occurs no less than 60 days following the first date of issuance of any series of Securities under this Indenture, (a) file with the Trustee within four months after the close of each fiscal year (which, until the Company shall otherwise notify the Trustee, shall be deemed to be the twelve months ending December 31 in each year) a consolidated income statement, a consolidated surplus statement and a consolidated balance sheet as of the end of such fiscal year, of the Company and its Subsidiaries, all certified by independent public or certified accountants selected by the Company (who may be the accountants who regularly audit the books of the Company and its Subsidiaries), accompanied by any report or comments by said accountants made in connection with the certification of such statements; (b) file with the Trustee concurrently with the filing of the foregoing financial statements, a certificate of the principal executive officer, the principal financial officer or the principal accounting officer of the Company, stating whether or not, to the knowledge of the signer, the Company has complied with all conditions and covenants on its part contained in this Indenture, and if the signer has obtained knowledge of any default by the Company in the performance, observance or fulfillment of any such condition or covenant, specifying each such default and the nature thereof (provided that, for purposes of this subsection (b), compliance shall be 58 48 determined without regard to any grace period or requirement of notice provided pursuant to the terms of this Indenture); and (c) file with the Trustee concurrently with the filing of such financial statements, a written statement of the firm of public or certified accountants who shall have certified such financial statements, addressed to the Company, to the effect that in making the audit necessary to said certification, they have obtained no knowledge of any default which is continuing at the date of such written statement under the Securities or under sec. 6.02(3), (4), (5), (6) or (12) of this Indenture, except as specifically indicated, provided, however, that such accountants shall not be liable to anyone by reason of any failure to obtain knowledge of any such default. All of the financial statements required by paragraph (11) of this sec. 6.02 to be filed with the Trustee shall be open to inspection during business hours by Holders of Securities. Transactions with Controlling Persons: (12) Will not itself and will not permit any Subsidiary (i) directly or indirectly to make any loan or otherwise extend credit to any Controlling Person or Controlling Person Subsidiary, or (ii) directly or indirectly to enter into any other transaction with a Controlling Person or Controlling Person Subsidiary, in either case on terms and conditions which the Company shall determine to be less favorable to the Company or such Subsidiary than the terms and conditions which would apply in a similar transaction with a Person other than a Controlling Person or Controlling Person Subsidiary, provided that this covenant shall not apply to transactions involving the Company and its Subsidiaries exclusively. sec. 6.03. Waiver. The observance of any provision of this Article Six (except sec. 6.01, sec. 6.02(8), (9) and (10) and sec. 6.03) may be waived with respect to any series of the Securities (either generally or in a particular instance and either before or after the time for such observance) if the Company shall have obtained the consent of the holders of at least sixty-six and two-thirds percent (66 2/3%) in aggregate principal amount of all Outstanding Securities of such series. 59 49 ARTICLE SEVEN. HOLDERS' LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE. sec. 7.01. Semi-Annual Lists of Holders. The Company covenants and agrees that it will furnish or cause to be furnished to the Trustee for the Securities of each series (i) semi-annually, not more than fifteen days after each record date for the payment of interest, if any, in respect of Securities of such series and on dates in each year to be determined pursuant to sec. 3.01 if the Securities of such series do not bear interest and (ii) at such other times as the Trustee may request in writing, within thirty days after receipt by the Company of any such request, a list, in such form as the Trustee may reasonably require, of the names and addresses of the Holders of the Registered Securities of such series, as of the respective record dates therefor (and on dates to be determined pursuant to sec. 3.01 if the Securities of such series do not bear interest); provided, however, that no such list need be furnished so long as the Trustee is the Securities Registrar for such series. Any such list may be dated as of a date not more than fifteen days prior to the time such information is furnished or caused to be furnished and need not include information received after such date. The Company shall also be required to furnish such information which is known to it concerning the Holders of Coupons and Unregistered Securities; provided however, that the Company shall have no obligation to investigate any matter relating to any Holder of an Unregistered Security or any Holder of a Coupon. sec. 7.02. Preservation of Information, etc. (a) The Trustee shall preserve, in as current a form as is reasonably practicable, all information as to the names and addresses of the Holders of Securities of each series (1) contained in the most recent list furnished to it as provided in sec. 7.01, (2) received by it in the capacity of Paying Agent for such series (if so acting) hereunder and of Securities Registrar for such series, and (3) filed with it within two preceding years pursuant to the provisions of paragraph (2) of Subsection (c) of sec. 7.04. The Trustee for any series of the Securities may (1) destroy any list furnished to it as provided in sec. 7.01 upon receipt of a new list so furnished, (2) destroy any information received by it as Paying Agent for such series (if so acting) hereunder upon delivering to itself as Trustee a list containing the names and addresses of the Holders of Securities of such series obtained from such information since the delivery of the next previous list, if any, (3) destroy any list delivered to itself as Trustee which was compiled from information received by it as Paying Agent (if so acting) hereunder upon the receipt of a new list so delivered, and (4) destroy any information filed with it by Holders 60 50 of Securities of such series for the purpose of receiving reports pursuant to the provisions of paragraph (2) of subsection (c) of sec. 7.04, but not until two years after such information has been filed with it. (b) In case three or more Holders of Securities of any series (hereinafter referred to as "applicants") apply in writing to the Trustee for such series, and furnish to the Trustee reasonable proof that each such applicant has owned a Security of such series for a period of at least six months preceding the date of such application, and such application states that the applicants desire to communicate with other Holders of Securities of such series or with Holders of Securities of all series for which the Trustee is serving as Trustee with respect to their rights under this Indenture or under such Securities, and is accompanied by a copy of the form of proxy or other communication which such applicants propose to transmit, then the Trustee shall, within five Business Days after the receipt of such application, at its election, either (1) afford to such applicants access to the information preserved at the time by the Trustee in accordance with the provisions of subsection (a) of this sec. 7.02, or (2) inform such applicants as to the approximate number of Holders of Securities of such series or of all series, as the case may be, whose names and addresses appear in the information preserved at the time by the Trustee, in accordance with the provisions of subsection (a) of this sec. 7.02, and as to the approximate cost of mailing to such Holders the form of proxy or other communication, if any, specified in such application. If the Trustee shall elect not to afford such applicants access to such information, the Trustee shall, upon the written request of such applicants, mail to each Holder of a Security of such series or all Holders of Securities of series for which it is Trustee, as the case may be, whose names and addresses appear in the information preserved at the time by the Trustee in accordance with the provisions of subsection (a) of this sec. 7.02 a copy of the form of proxy or other communication which is specified in such request, with reasonable promptness after a tender to the Trustee of the material to be mailed and of payment, or provision for the payment, of the reasonable expenses of mailing, unless within five days after such tender, the Trustee shall mail to such applicants and file with the Securities and Exchange Commission, together with a copy of the material to be mailed, a written statement to the effect that, in the opinion of the Trustee, such mailing would be contrary to the best interest of the Holders of Securities of such series or of the Holders of Securities of all series for which it is Trustee, as the case may be, or would be in violation of applicable law. Such written statement shall specify the basis of 61 51 such opinion. If said Commission, after opportunity for a hearing upon the objections specified in the written statements so filed, shall enter an order refusing to sustain any of such objections or if, after the entry of an order sustaining one or more of such objections, said Commission shall find, after notice and opportunity for hearing, that all the objections so sustained have been met and shall enter an order so declaring, the Trustee shall mail copies of such material to all Holders of Securities of such series or to all Holders of Securities of all series for which it is Trustee, as the case may be, with reasonable promptness after the entry of such order and the renewal of such tender; otherwise the Trustee shall be relieved of any obligation or duty to such applicants respecting their application. (c) Each and every Holder of the Securities, by receiving and holding the same, agrees with the Company and the Trustee that neither the Company nor the Trustee nor any Paying Agent shall be held accountable by reason of the disclosure of any such information as to the names and addresses of the Holders of Securities in accordance with the provisions of subsection (b) of this sec. 7.02, regardless of the source from which such information was derived, and that the Trustee shall not be held accountable by reason of mailing any material pursuant to a request made under said subsection (b). sec. 7.03. Periodic Reports by Company. (a) The Company covenants and agrees to file with the Trustee for each series of the Securities, within fifteen days after the Company is required to file the same with the Securities and Exchange Commission, copies of the annual reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as said Commission may from time to time by rules and regulations prescribe) which the Company may be required to file with said Commission pursuant to Section 13 or Section 15 (d) of the Securities Exchange Act of 1934, as amended; or, if the Company is not required to file information, documents or reports pursuant to either of such sections, then to file with the Trustee and said Commission, in accordance with rules and regulations prescribed from time to time by said Commission, such of the supplementary and periodic information, documents and reports which may be required pursuant to Section 13 of the Securities Exchange Act of 1934, as amended, in respect of a security listed and registered on a national securities exchange as may be prescribed from time to time in such rules and regulations. (b) The Company covenants and agrees to file with the Trustee for each series of the Securities and the Securities and Exchange Commission, in accordance with the rules and regulations prescribed from time to time by said Commission, such additional information, documents and reports with respect to compliance by the Company with the conditions and covenants provided for 62 52 in this Indenture as may be required from time to time by such rules and regulations. (c) The Company covenants and agrees to transmit to all Holders of Securities within thirty days after the filing thereof with the Trustee for each series of the Securities, in the manner and to the extent provided in subsection (c) of sec. 7.04 with respect to reports pursuant to subsection (a) of said sec. 7.04, such summaries of any information, documents and reports required to be filed by the Company pursuant to subsections (a) and (b) of this sec. 7.03 as may be required by rules and regulations prescribed from time to time by the Securities and Exchange Commission. sec. 7.04. Trustee's Reports to Holders. (a) Within 60 days after the first occurrence of the date provided therefor elsewhere in this Indenture, and within 60 days after such date in every year thereafter, so long as any Securities are outstanding hereunder, the Trustee for each series of the Securities shall transmit to all Holders of Securities of such series as hereinafter in this sec. 7.04 provided a brief report dated as of such date with respect to any of the following events which may have occurred during the twelve months preceding the date of such report (but if no such event has occurred within such period, no report need be transmitted): (1) any change to its eligibility under sec. 9.09, and its qualifications under sec. 9.08, or in lieu thereof, if to the best of its knowledge, it has continued to be eligible and qualified under such Sections, a written statement to such effect; (2) the creation of or any material change to a relationship specified in Section 310(b)(1) through Section 310(b)(10) of the Trust Indenture Act; (3) the character and amount of any advances (and if the Trustee elects so to state, the circumstances surrounding the making thereof) made by the Trustee (as such) which remain unpaid on the date of such report, and for the reimbursement of which it claims or may claim a lien or charge, prior to that of the Securities of any series, on any property or funds held or collected by it as Trustee if such advances so remaining unpaid aggregate more that one-half of one per cent of the principal amount of the Securities of any series outstanding on the date of such report; (4) any change to the amount, interest rate, and maturity date of all other indebtedness owing by the Company (or by any other obligor on the Securities of any series) to the Trustee in its individual capacity, on the 63 53 date of such report, with a brief description of any property held as collateral security therefor, except an indebtedness based upon a creditor relationship arising in any manner described in paragraphs (2), (3), (4) or (6) of Subsection (b) of sec. 9.13; (5) any change to the property and funds, if any, physically in the possession of the Trustee as such on the date of such report; (6) any additional issue of Securities of any series for which it is Trustee which the Trustee has not previously reported; and (7) any action taken by the Trustee in the performance of its duties under this Indenture which it has not previously reported and which in its opinion materially affects the Securities of any series, except action in respect of a default, notice of which has been or is to be withheld by it in accordance with the provisions of sec. 9.02. (b) The Trustee for each series of the Securities shall transmit to all Holders of Securities of such series, as hereinafter provided, a brief report with respect to the character and amount of any advances (and if the Trustee elects so to state, the circumstances surrounding the making thereof) made by the Trustee as such since the date of the last report transmitted pursuant to the provisions of Subsection (a) of this sec. 7.04 (or if no such report has yet been so transmitted, since the date of execution of this Indenture), for the reimbursement of which it claims or may claim a lien or charge prior to that of the Securities of any series on property or funds held or collected by it as Trustee, and which it has not previously reported pursuant to this subsection if such advances remaining unpaid at any time aggregate more than ten per cent (10%) of the principal amount of Securities of such series Outstanding at such time, such report to be transmitted within ninety days after such time. (c) Reports pursuant to this sec. 7.04 shall be transmitted by mail: (1) to all registered Holders of Registered Securities, as the names and addresses of such Holders appear in the applicable Securities Register; (2) to such Holders of Securities of any series as have, within two years preceding such transmission, filed their names and addresses with the Trustee for such series for that purpose; and (3) except in the cases of reports pursuant to subsection (b) of this sec. 7.04, to each Holder of a Security of any series whose name and address is preserved at the time by the Trustee for such series, as provided in subsection (a) of sec. 7.02. 64 54 (d) A copy of each such report shall, at the time of such transmission to Holders of Securities of any series, be filed by the Trustee for such series with each stock exchange upon which such Securities are listed and also with the Securities and Exchange Commission. The Company agrees to notify the Trustee for each series when and as any Securities become listed on any stock exchange. sec. 7.05 Delivery of Reports by the Trustee. The date referred to in sec. 7.04 hereof, 60 days after which the Trustee is required to transmit the reports referred to in such sec. 7.04, shall be the first January 1 which occurs not less than 60 days following the first date of issuance of the Securities of any series under this Indenture. ARTICLE EIGHT. REMEDIES OF THE TRUSTEE AND HOLDERS ON EVENT OF DEFAULT. sec. 8.01. Events of Default; Effect Thereof. "Event of Default" whenever used herein with respect to Securities of any series means any one of the following events and such other events as may be established with respect to the Securities of such series as contemplated by sec. 3.01 hereof (whatever the reason for such Event of Default and whether it shall be occasioned by the provisions of Article Fifteen 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), continued for the period of time, if any, and after the giving of notice, if any, designated herein or therein, as the case may be, unless it is either inapplicable to a particular series or it is specifically deleted or modified in the applicable resolution of the Board of Directors or in the supplemental indenture under which such series of Securities is issued, as the case may be, as contemplated by sec. 3.01: (1) default shall occur in the punctual payment of the principal of and premium, if any, of any Security of such series when and as the same shall become due and payable, at its Maturity, or default in the making or satisfaction of any sinking fund payment or analogous obligation as and when the same shall become due and payable by the terms of the Securities of such series, or (2) default shall occur in the payment of any installment of interest on any Security of such series as and when the same shall become due and payable, and such default shall continue for thirty days, or 65 55 (3) default shall occur in the due observance or performance of any other covenant, condition or agreement on the part of the Company in respect of the Securities of such series contained in this Indenture (other than a covenant or agreement in respect of the Securities of such series a default in whose observance is elsewhere in this Section specifically dealt with), and any such default shall continue for sixty days after written notice thereof, specifying such default and requiring the same to be remedied, shall have been given to the Company by the Trustee for such series, which may, in its discretion, give such notice and shall do so at the request pursuant to sec. 10.01 of the Holders of at least a majority in principal amount of the Securities of such series at the time Outstanding, or (4) by the order of a court of competent jurisdiction a receiver or liquidator or trustee of the Company or of any of the property of the Company shall be appointed and such receiver or liquidator or trustee shall not have been discharged within a period of sixty days, or, by decree of such a court, the Company shall be adjudicated bankrupt or insolvent or any substantial part of the property of the Company shall have been sequestered and such decree shall have continued undischarged and unstayed for a period of sixty days after the entry thereof, or a petition to declare bankrupt or to reorganize the Company pursuant to any of the provisions of the Federal Bankruptcy Code, as it now exists, or as it may hereafter be amended, or pursuant to any other similar statute applicable to the Company, as now or hereafter in effect, shall be filed against the Company (and, in the case of any such petition filed pursuant to any provision of a statute which requires the approval of such petition by a court, shall be approved by such a court) and shall not be dismissed within sixty days after such filing, or (5) the Company shall file a petition in voluntary bankruptcy under any provision of any bankruptcy law or shall consent to the filing of any bankruptcy or reorganization petition against it under any similar law, or (without limitation of the generality of the foregoing) the Company shall file a petition or answer or consent seeking relief or assisting in seeking relief for the Company in a proceeding under any of the provisions of the Federal Bankruptcy Code, as it now exists or as it may hereafter be amended, or pursuant to any other similar statute applicable to the Company, as now or hereafter in effect, or an answer admitting the material allegations of a petition filed against it in such a proceeding, or the Company or its directors or stockholders shall take action looking to the dissolution or liquidation of the Company (except in connection with a 66 56 consolidation, merger, sale or conveyance pursuant to Article Six hereof), or the Company shall make an assignment for the benefit of its creditors, or shall admit in writing its inability to pay its debts generally as they become due, or shall consent to the appointment of a receiver or receivers, or trustee or trustees, or liquidator or liquidators, of it or of all or any part of its property, or (6) a default shall occur in the payment of any installment of interest, when the same shall become due and payable, on any other series of Securities issued or hereafter issued pursuant to this Indenture or on any other bond, debenture, note or other evidence of indebtedness issued, assumed or guaranteed by the Company and such default shall continue for a period of thirty days, or default shall be made in the payment of the principal of any such other series of Securities or any such other bond, debenture, note or evidence of indebtedness when the same shall become due and payable whether at Maturity, by declaration, by call for prepayment, by call for redemption, or otherwise, and the time for payment of such interest or principal shall not have been effectively extended, or (7) any other Event of Default provided in the applicable resolution of the Board of Directors or in the supplemental indenture under which such series of Securities is issued, as the case may be, as contemplated by sec. 3.01. If an Event of Default with respect to Securities of any series at the time outstanding shall have occurred and be continuing, then and in each and every such case, unless the principal of all the Securities of such series shall have already become due and payable, either the Trustee for such series or the Holders of not less than 25% in aggregate principal amount of the Securities of such series then Outstanding hereunder, by notice in writing to the Company (and to the Trustee if given by the Holders), may declare the principal amount (or, if the Securities of such series are Original Issue Discount Securities, such portion of the principal amount as may be specified in the terms of that series) of all the Securities of such series to be due and payable immediately, and upon any such declaration the same shall become and shall be immediately due and payable, anything in this Indenture or in the Securities of such series contained to the contrary notwithstanding. This provision, however, is subject to the condition that if, at any time after the principal amount (or if the Securities of such series are Original Issue Discount Securities, such portion of the principal amount as may be specified in the terms of such series) of the Securities of any series shall have been so declared due and payable, and before any judgment or decree for the payment of the moneys due shall have been obtained or entered as hereinafter provided, the Company shall pay or shall 67 57 deposit with the Trustee for such series a sum sufficient to pay in the currency or currency unit in which the Securities of such series are payable (except as otherwise specified as contemplated by sec.3.01 for the Securities of such series and except as provided in sec.sec.3.11(b), 3.11(e) and 3.11(f) of this Indenture), all matured installments of interest, if any, upon all the Securities of such series and (in the currency or currency unit described above) the principal of (and premium, if any, on) any and all Securities of such series which shall have become due otherwise than by acceleration (with interest on such principal and premium, if any, and, so far as payment of the same is enforceable under applicable law, on overdue installments of interest, at the Overdue Rate applicable to such series to the date of such payment or deposit) and in Dollars all amounts payable to the Trustee pursuant to the provisions of sec. 9.07, and any and all defaults under this Indenture with respect to such series of Securities, other than the nonpayment of principal of and accrued interest on Securities of such series which shall have become due by acceleration, shall have been remedied or cured or waived or provision shall have been made therefor to the satisfaction of the Trustee -- then and in every such case the Holders of a majority in aggregate principal amount of the Securities of such series then Outstanding, by written notice to the Company and to the Trustee, may waive all defaults and its consequences; but no such waiver or rescission and annulment shall extend to or shall affect any subsequent default, or shall impair any right consequent thereon. In case the Trustee shall have proceeded to enforce any right under this Indenture and such proceedings shall have been discontinued or abandoned because of such rescission or annulment or for any other reason or shall have been determined adversely to the Trustee, then and in every such case the Company and the Trustee shall be restored respectively to their several positions and rights hereunder, and all rights, remedies and powers of the Company and the Trustee shall continue as though no such proceedings had been taken. sec. 8.02. Collection of Indebtedness by Trustee. The Company covenants that (a) in case default shall occur in payment of any installment of interest on any Security of any series as and when the same shall become due and payable, and such default shall have continued for a period of thirty days, or (b) in case default shall occur in the payment of the principal of or premium, if any, on any Security of any series when the same shall have become payable, upon Maturity of the Securities of that series or (c) in case of default in the making or satisfaction of any sinking fund payment or analogous obligation when the same becomes due by the terms of the Securities of any series -- then, upon demand of the Trustee for such series, the Company will pay to the Trustee, for 68 58 the benefit of the Holder of any such Security (or Holders of any such series of Securities in the case of clause (c) above) and the Holders of any Coupons appertaining thereto the whole amount that then shall have become due and payable on any such Security (or Securities of any such series in the case of clause (c) above) and matured Coupons, if any, appertaining thereto for the principal, premium, if any, and interest, if any, with interest upon the overdue principal and premium, if any, and, so far as payment of the same is enforceable under applicable law, on overdue installments of interest, at the Overdue Rate applicable to any such Security (or Securities of any such series in the case of clause (c)); and, in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, and any further amounts payable to the Trustee pursuant to the provisions of sec. 9.07. In case the Company shall fail forthwith to pay such amounts upon such demand, the Trustee, in its own name and as trustee of an express trust, shall be entitled and empowered to institute any actions or proceedings at law or in equity for the collection of the sums so due and unpaid and may prosecute any such action or proceeding to judgment or final decree, and may enforce any such judgment or final decree against the Company or any other obligor on such Security (or Securities of any such series in the case of clause (c)) and Coupons and collect in the manner provided by law out of the property of the Company or any other obligor on such Security (or Securities of any such series in the case of clause (c)) and Coupons wherever situated the moneys adjudged or decreed to be payable. The Trustee for any series of the Securities shall be entitled and empowered, either in its own name as trustee of an express trust, or as attorney-in-fact for the Holders of any of the Securities of such series and for the Holders of any Coupons appertaining thereto, or in both such capacities, to file such proof of debt, amendment of proof of debt, claim, petition or other document as may be necessary or advisable in order to have the claims of the Trustee and of the Holders of Securities of such series and the Holders of any Coupons appertaining thereto allowed in any equity receivership, insolvency, bankruptcy, liquidation, readjustment, reorganization or other similar proceedings, or any judicial proceedings, relative to the Company or any other obligor on the Securities of such series and any Coupons appertaining thereto or its creditors or its property. The Trustee for each series of the Securities is hereby irrevocably appointed (and the successive respective Holders of the Securities of such series and the Holders of any Coupons appertaining thereto, by taking and holding the same, shall be conclusively deemed to have so appointed the Trustee) the true and lawful attorney-in-fact of the respective Holders of the Securities of such series and the Holders of any Coupons appertaining thereto, 69 59 with authority to make or file in the respective names of the Holders of the Securities of such series and the Holders of any Coupons appertaining thereto or on behalf of all the Holders of Securities of all series and the Holders of any Coupons appertaining thereto for which it is Trustee, any proof of debt, amendment of proof of debt, claim, petition or other document in any such proceedings and to receive payment of any sums becoming distributable on account thereof, and to execute any other papers and documents and do and perform any and all acts and things for and on behalf of such Holders of the Securities of such series and the Holders of any Coupons appertaining thereto, as may be necessary or advisable in the opinion of the Trustee in order to have the respective claims of the Holders of the Securities of such series and the Holders of any Coupons appertaining thereto against the Company or any other obligor on the Securities of such series and any Coupons appertaining thereto and/or its property allowed in any such proceedings, and to receive payment of or on account of such claims; provided, however, that nothing herein contained shall be deemed to authorize or empower the Trustee to consent to or accept or adopt, on behalf of any Holder of Securities of any series or any Holder of any Coupons appertaining thereto, any plan of reorganization or readjustment of the Company or any other obligor on the Securities of any series and any Coupons appertaining thereto, or, by other action of any character in any such proceeding, to waive or change in any way any right of any Holder of any Security of any series or any Holder of any Coupons appertaining thereto even though it may otherwise be entitled so to do under any present or future law, all such power or authorization being hereby expressly denied. All rights of action and of asserting claims under this Indenture, or under the Securities of any series or any Coupons appertaining thereto, may be enforced by the Trustee for such series without the possession of any of the Securities of such series or any Coupons appertaining thereto, or the production thereof on any trial or other proceeding relative thereto, and any such suit or proceeding instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall be for the ratable benefit of the Holders of the Securities or Coupons in respect of which such action was taken. sec. 8.03. Application of Moneys Collected by Trustee. Any moneys collected by the Trustee for the Securities of any series under or pursuant to, or as authorized or permitted by, this Article Eight, together with any other sums held by the Trustee (as such) hereunder (other than sums held in trust for the benefit of the Holders of particular Securities or Coupons), shall be applied as follows at the date fixed by the Trustee for distribution of such moneys, upon 70 60 presentation (except in respect of Subdivision FIRST below) of the several Securities and any Coupons appertaining thereto with respect to which such moneys were collected, and stamping thereon of an appropriate legend respecting the payment, if only partially paid, or upon the surrender thereof, if fully paid: FIRST: To the payment of all amounts due the Trustee pursuant to the provisions of sec. 9.07; SECOND: In case the principal of such Outstanding Securities shall not have become due and shall not be unpaid, to the payment of the interest, if any, on the Securities of such series in the order of maturity of the installments of such interest, with interest (to the extent that such interest has been collected by the Trustee), so far as it may be enforceable under applicable law, upon the overdue installments at the Overdue Rate applicable to such series, such payments to be made, subject to the provisions of sec. 8.08, ratably to the persons entitled thereto without discrimination or preference; THIRD: In case the principal of such Outstanding Securities shall have become due by declaration or otherwise, to the payment of the whole amount then owing and unpaid upon the Securities of such series for principal, premium, if any, and interest, if any, with interest upon any overdue principal and premium, if any, and also (to the extent that such interest has been collected by the Trustee), so far as payment of the same is enforceable under applicable law, upon any overdue installments of interest, if any, at the Overdue Rate applicable to such series; and, in case such moneys shall be insufficient to pay in full the whole amount so due and unpaid upon the Securities of such series, then, subject to the provisions of sec. 8.08, to the payment of such principal, premium, if any, and interest, if any, without preference or priority of principal, and premium, if any, over interest, or of interest, if any, over principal, and premium, if any, or of any installment of interest, if any, over any other installment of interest, if any, or of any Security of such series over any other Security of such series, or of any Coupon appertaining thereto over any other Coupon appertaining thereto, ratably to the aggregate of such principal, premium, if any, and interest, if any; FOURTH: To the payment of all other amounts payable by the Company under the terms of this Indenture; and FIFTH: To the payment of the surplus, if any, to the Company, its successors or assigns or to whosoever may be lawfully entitled to receive the same, or as a court of competent jurisdiction may direct. 71 61 sec. 8.04. Limitation on Suits on Indenture; No Limitation on Suits on Securities. No Holder of any Security of any series or Holder of any Coupons appertaining thereto shall have any right by virtue of or by availing of any provision of this Indenture to institute any suit, action or proceeding in equity or at law upon or under or with respect to this Indenture or for the appointment of a receiver or trustee (or other similar official), or for any other remedy hereunder, unless an Event of Default shall have occurred and be continuing and such Holder previously shall have given to the Trustee for such series written notice of default and of the continuance thereof, as hereinbefore provided, and unless also the Holders of not less than 25% in aggregate principal amount of the Securities of such series then Outstanding shall have made written request upon the Trustee for such series to institute such action, suit or proceeding in its own name as Trustee hereunder and shall have offered to the Trustee such reasonable indemnity as it may require against the costs, expenses and liabilities to be incurred therein or thereby, and the Trustee for sixty days after its receipt of such notice, request and offer of indemnity, shall have neglected or refused to institute any such action, suit or proceeding; it being understood and intended, and being expressly covenanted by the taker and Holder of every Security and by the taker and Holder of any Coupon appertaining thereto with every other taker and Holder of any Security and of any Coupon appertaining thereto and the Trustee for the Securities of each series, that no one or more Holders of Securities of any series or of any Coupons appertaining thereto shall have any right in any manner whatever by virtue or by availing of any provision of this Indenture to affect, disturb or prejudice the rights of any other Holder of Securities of such series or of any Coupons appertaining thereto, or to obtain or seek to obtain priority over or preference to any other such Holder, or to enforce any right under this Indenture, except in the manner herein provided and for the equal, ratable and common benefit of all Holders of Securities of such series or of any Coupons appertaining thereto. For the protection and enforcement of the provisions of this sec. 8.04, each and every Holder of Securities of any series or of any Coupons appertaining thereto and the Trustee for such series shall be entitled to such relief as can be given either at law or in equity. Nothing contained in this Indenture, in the Securities of any series, or in any Coupon appertaining thereto, shall affect or impair the obligation of the Company, which is unconditional and absolute, to pay the principal of, and premium, if any, and interest, if any, on the Securities of such series at the respective places, at the respective times, at the respective rates, in the respective amounts and in the coin, currency or currency unit therein and herein prescribed or affect or impair the right of action, which is also absolute 72 62 and unconditional, of any Holder of any Security or Coupon, if any, to institute suit to enforce such payment at the respective due dates expressed in such Security or Coupon, if any, or upon redemption, by declaration, repayment or otherwise as herein provided without reference to, or the consent of, the Trustee or the Holder of any other Security or Coupon, if any, unless such Holder consents thereto. sec. 8.05. Remedies Cumulative; Delay not to Impair Rights. All powers and remedies given by this Article Eight to the Trustee for any series of the Securities or to the Holders of such Securities or any Coupons appertaining thereto shall, to the extent permitted, by law, be deemed cumulative and not exclusive of any thereof or of any other powers and remedies available to the Trustee or the Holders of such Securities or any Coupons appertaining thereto by judicial proceedings or otherwise to enforce the performance or observance of the covenants and agreements contained in this Indenture, and no delay or omission of the Trustee or of any Holder of any of the Securities of such series or any Coupons appertaining thereto to exercise any right or power accruing upon any default occurring and continuing as aforesaid shall impair any such right or power, or shall be construed to be a waiver of any such default or an acquiescence therein; and, subject to the provisions of sec. 8.04, every power and remedy given by this Article Eight or by law to the Trustee for any series of the Securities or to Holders of the Securities of such series or any Coupons appertaining thereto may be exercised from time to time, and as often as shall be deemed expedient, by the Trustee for such series or by Holders of such Securities or any Coupons appertaining thereto. No waiver of any default hereunder shall extend to or affect any other or subsequent default or impair any rights or remedies consequent thereon. sec. 8.06. Directions by Holders of Securities. The Holders of a majority in aggregate principal amount of the Securities of any series at the time Outstanding, shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee for such series, or exercising any trust or power conferred on the Trustee. sec. 8.07. Undertakings for Costs. All parties to this Indenture agree and each Holder of any Security and each Holder of any 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 any suit against the Trustee for the Securities of any series for any action taken or omitted by it as Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys' fees, against any party litigant in such suit, having due regard to the merits and 73 63 good faith of the claims or defenses made by such party litigant; but the provisions of this sec. 8.07 shall not apply to any suit instituted by the Trustee for the Securities of any series, to any suit instituted by any Holder of Securities of any series, or group of such Holders, holding in the aggregate more than 10% in aggregate principal amount of the Outstanding Securities of such series, or any suit instituted by any Holder of Securities or Coupons for the enforcement of the payment of the principal of, premium, if any, or interest, if any, on any Security or Coupon on or after the due date expressed in such Security or Coupon, on or after the date fixed for redemption or after such Security or Coupons shall have become due by declaration. sec. 8.08. 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 for the Securities of any series, but will suffer and permit the execution of every such power as though no such law had been enacted. sec. 8.09. Judgment Currency. If for the purpose of obtaining a judgment in any court with respect to any obligation of the Company hereunder or under any Security or Coupon, it shall become necessary to convert into any other currency or currency unit any amount in the currency or currency unit due hereunder or under such Security or Coupon, then such conversion shall be made at the Conversion Rate as in effect on the date the Company shall make payment to any Person in satisfaction of such judgment. If pursuant to any such judgment, conversion shall be made on a date other than the date payment is made and there shall occur a change between such Conversion Rate and the Conversion Rate as in effect on the date of payment, the Company agrees to pay such additional amounts (if any) as may be necessary to ensure that the amount paid is the amount in such other currency or currency unit which, when converted at the Conversion Rate as in effect on the date of payment or distribution, is the amount then due hereunder or under such Security or Coupon. Any amount due from the Company under this sec. 8.09 shall be due as a separate debt and is not to be affected by or merged into any judgment being obtained for any other sums due hereunder or in respect of any Security or Coupon. In no event, however, shall the Company be required to pay more in the currency or currency unit due hereunder or under such Security or Coupon at the Conversion Rate as in effect when payment is made 74 64 than the amount of currency or currency unit stated to be due hereunder or under such Security or Coupon so that in any event the Company's obligations hereunder or under such Security or Coupon will be effectively maintained as obligations in such currency or currency unit. For purposes of this sec. 8.09, "Conversion Rate" shall mean the spot rate at which in accordance with normal banking procedures the currency or currency unit into which an amount due hereunder or under any Security or Coupon is to be converted could be purchased with the currency or currency unit due hereunder or under any Security or Coupon from major banks located in New York, London or any other principal market for such purchased currency or currency unit. ARTICLE NINE. CONCERNING THE TRUSTEE. sec. 9.01. Certain Duties and Responsibilities. (a) Except during the continuance of an Event of Default, (1) the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and (2) in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture; but in the case of any such certificates or opinions which by any provision hereof are specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Indenture. (b) In case an Event of Default has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs. (c) No provision of this Indenture shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent failure to act, or its own wilful misconduct, except that 75 65 (1) this Subsection shall not be construed to limit the effect of Subsection (a) of this sec. 9.01; (2) the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts; (3) the Trustee for the Securities of any series 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 Securities of such series pursuant to sec. 8.06 relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Indenture with respect to Securities of such series; and (4) no provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. (d) Whether or not therein expressly so provided, every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Section. sec. 9.02. Notice of Defaults. Within 90 days after the occurrence of a default hereunder with respect to the Securities of any series, the Trustee for such series shall transmit by mail to all Holders of Securities of such series, in the manner and to the extent provided in sec. 7.04(c) and give to all Holders of Securities of such series and of Coupons, if any, appertaining thereto as otherwise provided in sec. 14.03, notice of such default hereunder with respect to such series known to the Trustee, unless such default shall have been cured or waived; provided, however, that, except in the case of a default in the payment of the principal of, premium, if any, or interest, if any, on any Security of such series or in the payment of any sinking fund installment or analogous obligation with respect to such series, the Trustee shall be protected in withholding such notice if and so long as the board of directors, the executive committee or a trust committee of directors and/or Responsible Officers of the Trustee in good faith determines that the withholding of such notice is in the interests of the Holders of Securities of such series and of Coupons, if any, appertaining thereto; and provided, further, that in the case of any default of the character specified in sec. 8.01(3) no such notice to Holders shall be given until at least 30 76 66 days after the occurrence thereof. For the purpose of this sec. 9.02, the term "default" means any event which is, or after notice or lapse of time or both would become, an Event of Default. sec. 9.03. Certain Rights of Trustee. Except as otherwise provided in sec. 9.01: (a) the Trustee may rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, coupon or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties; (b) any request, direction, order or demand of the Company mentioned herein shall be sufficiently evidenced by an Officers' Certificate 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 for the Securities of any series shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request, order or direction of any of the Holders of Securities of such series pursuant to this Indenture, unless such Holders of Securities shall have offered to the Trustee reasonable security or indemnity against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction; (f) the Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Company, personally or by agent or attorney; (g) the Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or 77 67 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; and (h) the Trustee shall not be liable for any action taken by it in good faith and believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Indenture. sec. 9.04. Not Responsible for Recitals or Issuance of Securities. The recitals contained herein and in the Securities, except the certificates of authentication, shall be taken as the statements of the Company, and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Indenture or of the Securities or Coupons. The Trustee shall not be accountable for the use or application by the Company of Securities or the proceeds thereof. sec. 9.05. May Hold Securities. The Trustee, any Paying Agent, Securities Registrar, Authenticating Agent or any other agent of the Company or the Trustee, in its individual or any other capacity, may become the owner or pledgee of Securities or Coupons and, subject to sec. 9.08 and sec. 9.13, may otherwise deal with the Company with the same rights it would have if it were not Trustee, Paying Agent, Securities Registrar, Authenticating Agent or such other agent. sec. 9.06. Money Held in Trust. Money in any currency or currency unit held by the Trustee in trust hereunder need not be segregated from other funds except to the extent required by law. The Trustee shall be under no liability for interest on any money received by it hereunder except as otherwise agreed with the Company. sec. 9.07. Compensation and Reimbursement. The Company agrees (1) to pay to the Trustee for the Securities of each series from time to time reasonable compensation in Dollars 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 in Dollars for the Securities of each series 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 78 68 (3) to indemnify in Dollars the Trustee for the Securities of each series 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. All such payments and reimbursements shall be made with interest at the rate of 12% per annum. As security for the performance of the obligations of the Company under this sec. 9.07 the Trustee for the Securities of any series shall have a lien prior to the Securities of all series upon all property and funds held or collected by the Trustee as such, except funds held in trust for the payment of principal of, premium, if any, or interest, if any, on Securities of any series. The obligations of the Company under this sec. 9.07 to compensate and indemnify the Trustee and to pay and reimburse the Trustee for expenses, disbursements and advances shall constitute additional indebtedness under the Indenture and shall survive the satisfaction and discharge of this Indenture. sec. 9.08. Disqualification; Conflicting Interests. The Trustee for the Securities of any series issued hereunder shall be subject to the provisions of Section 310(b) of the Trust Indenture Act during the period of time provided for therein. In determining whether the Trustee has a conflicting interest as defined in Section 310(b) of the Trust Indenture Act with respect to the Securities of any series, there shall be excluded this Indenture with respect to Securities of any particular series of Securities other than that series. Nothing herein shall prevent the Trustee from filing with the Commission the application referred to in the penultimate paragraph of Section 310(b) of the Trust Indenture Act. sec. 9.09. Corporate Trustee Required; Eligibility. There shall at all times be a Trustee hereunder for the Securities of each series, which shall be at all times either (i) a corporation organized and doing business under the laws of the United States of America or of any State or territory or the District of Columbia, authorized under such laws to exercise corporate trust powers and subject to supervision or examination by Federal, State, territory or District of Columbia authority, or 79 69 (ii) a corporation or other Person organized and doing business under the laws of a foreign government that is permitted to act as Trustee pursuant to a rule, regulation or order of the Commission, authorized under such laws to exercise corporate trust powers, and subject to supervision or examination by authority of such foreign government or a political subdivision thereof substantially equivalent to supervision or examination applicable to United States institutional trustees, in either case having a combined capital and surplus of at least $10,000,000. If such corporation publishes reports of condition at least annually, pursuant to law or to requirements of the aforesaid supervising or examining authority, then for the purposes of this sec. 9.09, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time the Trustee for the Securities of any series shall cease to be eligible in accordance with the provisions of this sec. 9.09, it shall resign immediately in the manner and with the effect hereinafter specified in this Article Nine. Neither the Company nor any Person directly or indirectly controlling, controlled by, or under common control with the Company shall serve as Trustee for the Securities of any series issued hereunder. sec. 9.10. Resignation and Removal; Appointment of Successor. (a) No resignation or removal of the Trustee for the Securities of any series and no appointment of a successor Trustee for such series pursuant to this Article shall become effective until the acceptance of appointment by the successor Trustee under sec. 9.11. (b) The Trustee, or any trustee or trustees hereafter appointed, for the Securities of any series may resign at any time with respect to one or more or all such series of Securities by giving written notice thereof to the Company. If an instrument of acceptance by a successor Trustee for Securities of any series shall not have been delivered to the Trustee for such series within thirty 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 for such series. (c) The Holders of a majority in aggregate principal amount of the Securities of one or more series (each voting as a class) or all series at the time Outstanding for which the Trustee is serving as Trustee may at any time remove the Trustee with respect to any or all such series, as the case may be, 80 70 and appoint with respect to any or all such series, as the case may be, a successor Trustee by written notice of such action to the Company, the Trustee for the applicable series and the successor Trustee. (d) If at any time: (1) the Trustee for the Securities of any series shall fail to comply with Section 310(b) of the Trust Indenture Act with respect to such series after written request therefor by the Company or by any Holder of Securities who has been a bona fide Holder of a Security or Securities of such series for at least six months, unless the Trustee's duty to resign is stayed in accordance with the provisions of Section 310(b) of the Trust Indenture Act, or (2) the Trustee for the Securities of any series shall cease to be eligible under sec. 9.09 with respect to such series and shall fail to resign after written request therefor by the Company or by any Holder of Securities of such series, or (3) the Trustee for the Securities of any series shall become incapable of acting with respect to such series 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 case, (i) the Company by a resolution of the Board of Directors may remove the Trustee with respect to such series, or (ii) subject to sec. 8.07, any Holder who has been a bona fide Holder of a Security or Securities of such series for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee for such series. (e) If the Trustee for the Securities of any series shall resign, be removed or become incapable of acting, or if a vacancy shall occur in the office of Trustee for the Securities of any series for any cause, the Company, by a resolution of the Board of Directors, shall promptly appoint a successor Trustee for such series. If, within one year after such resignation, removal or incapability, or the occurrence of such vacancy, a successor Trustee for such series shall be appointed by act of the Holders of a majority in principal amount of the Outstanding Securities of such series delivered to the Company and the retiring Trustee, the successor Trustee so appointed shall, forthwith upon its 81 71 acceptance of such appointment, become the successor Trustee and supersede the successor Trustee appointed by the Company. If no successor Trustee for the Securities of such series shall have been so appointed by the Company or the Holders of the Outstanding Securities of such series and accepted appointment in the manner hereinafter provided, any Holder of a Security of such series who has been such 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 for the Securities of such series. (f) The Company shall give notice of each resignation and each removal of the Trustee and each appointment of a successor Trustee for the Securities of any series by providing notice of such event to the Holders of Securities of such series in the manner and to the extent provided in sec. 14.03. Each notice shall include the name of the successor Trustee and the address of its Corporate Trust Office. sec. 9.11. Acceptance of Appointment by Successor. Every successor Trustee appointed hereunder shall execute, acknowledge and deliver to the Company and to the retiring Trustee an instrument accepting such appointment, and thereupon the resignation or removal of the retiring Trustee shall become effective and such successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee; but, on request of the Company or the successor Trustee, such retiring Trustee shall, upon payment of its charges, execute and deliver an instrument transferring to such successor Trustee all the rights, powers and trusts of the retiring Trustee, and shall duly assign, transfer and deliver to such successor Trustee all property and money held by such retiring Trustee hereunder, subject nevertheless to its lien, if any, provided for in sec. 9.07. 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. In case of the appointment hereunder of a successor Trustee for the Securities of one or more (but not all) series, the Company, the predecessor Trustee and each successor Trustee for the Securities of any applicable series shall execute and deliver an indenture supplemental hereto which shall contain such provisions as shall be deemed necessary or desirable to confirm that all the rights, powers, trusts and duties of the predecessor Trustee for the Securities of any series as to which the predecessor Trustee is not retiring shall continue to be vested in the predecessor Trustee, and shall add to or change any of the provisions of this Indenture as shall be necessary to provide for or 82 72 facilitate the administration of the trusts hereunder by more than one Trustee, it being understood that nothing herein or in such supplemental indenture shall constitute such Trustee's co-trustees of the same trust and that each such Trustee shall be trustee of a trust or trusts hereunder separate and apart from any trust or trusts hereunder administered by any other such Trustee. No successor Trustee for a series of Securities shall accept its appointment unless at the time of such acceptance such successor Trustee shall with respect to such series be qualified and eligible under this Article. Upon acceptance of appointment by a successor Trustee as provided in this sec. 9.11, the Company shall provide notice of the succession of such Trustee hereunder to the Holders of Securities of any applicable series and to the Holders of Coupons, if any, appertaining thereto in the manner and to the extent provided in sec. 14.03. If the Company fails to provide such notice within ten days after the acceptance of appointment by the successor Trustee, the successor Trustee shall cause such notice to be given at the expense of the Company. sec. 9.12. Merger, Conversion, Consolidation or Succession to Business. Any corporation into which the Trustee for the Securities of any series may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or any corporation succeeding to all or substantially all of the corporate trust business of the Trustee, shall be the successor of the Trustee for such series hereunder, provided such corporation shall, with respect to such series, be otherwise qualified and eligible under this Article, to the extent operative, 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 of one or more series shall have been authenticated, but not delivered, by the Trustee for such series 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; and in case at that time any of such Securities shall not have been authenticated, any successor to the Trustee may authenticate such Securities either in the name of the Trustee or such successor to the Trustee. sec. 9.13. Preferential Collection of Claims Against Company. (a) Subject to Subsection (b) of this sec. 9.13, if the Trustee for the Securities of any series shall be or shall become a creditor, directly or indirectly, secured or unsecured, of the Company or any other obligor on the Securities of such series within 83 73 three months prior to a default, as defined in Subsection (c) of this sec. 9.13, or subsequent to such a default, then, unless and until such default shall be cured, the Trustee shall set apart and hold in a special account for the benefit of the Trustee individually, the Holders of the Securities of such series, the Holders of the Coupons, if any, appertaining thereto and the holders of other indenture securities (as defined in Subsection (c) of this sec. 9.13): (1) an amount equal to any and all reductions in the amount due and owing upon any claim as such creditor in respect of principal or interest, effected after the beginning of such three month period and valid as against the Company and its other creditors, except any such reduction resulting from the receipt or disposition of any property described in paragraph (2) of this sec. 9.13(a), or from the exercise of any right of set-off which the Trustee could have exercised if a petition in bankruptcy had been filed by or against the Company upon the date of such default; and (2) all property received by the Trustee in respect of any claim as such creditor, either as security therefor, or in satisfaction or composition thereof, or otherwise, after the beginning of such three month period, or an amount equal to the proceeds of any such property, if disposed of, subject, however, to the rights, if any, of the Company and its other creditors in such property or such proceeds. Nothing herein contained, however, shall affect the right of the Trustee (A) to retain for its own account (i) payments made on account of any such claim by any person (other than the Company) who is liable thereon, and (ii) the proceeds of the bona fide sale of any such claim by the Trustee to a third person, and (iii) distributions made in cash, securities or other property in respect of claims filed against the Company in bankruptcy or receivership or in cases or proceedings for reorganization or for any related or similar purpose pursuant to the Federal Bankruptcy Code or applicable State law; (B) to realize, for its own account, upon any property held by it as security for any such claim, if such property was so held prior to the beginning of such three month period; (C) to realize, for its own account, but only to the extent of the claim hereinafter mentioned, upon any property held by it as security for any such claim, if such claim was created after the beginning of such three month period and such property was received as security therefor simulta- 84 74 neously with the creation thereof, and if the Trustee shall sustain the burden of proving that at the time such property was so received the Trustee had no reasonable cause to believe that a default as defined in Subsection (c) of this sec. 9.13 would occur within three months; or (D) to receive payment on any claim referred to in paragraph (B) or (C), against the release of any property held as security for such claim provided in paragraph (B) or (C), as the case may be, to the extent of the fair value of such property. For the purposes of paragraphs (B), (C) and (D), property substituted after the beginning of such three month period for property held as security at the time of such substitution shall, to the extent of the fair value of the property released, have the same status as the property released, and, to the extent that any claim referred to in any of such paragraphs is created in renewal of or in substitution for or for the purpose of repaying or refunding any pre-existing claim of the Trustee as such creditor, such claim shall have the same status as such pre-existing claim. If the Trustee for the Securities of any series shall be required to account, the funds and property held in such special account and the proceeds thereof shall be apportioned among the Trustee, the Holders of the Securities of such series, the Holders of the Coupons, if any, appertaining thereto and the holders of other indenture securities in such manner that the Trustee, such Holders and the holders of other indenture securities realize, as a result of payments from such special account and payments of dividends on claims filed against the Company in bankruptcy or receivership or in cases or proceedings for reorganization or for any related or similar purpose pursuant to the Federal Bankruptcy Code or other applicable Federal or State law, the same percentage of their respective claims, figured before crediting to the claim of the Trustee anything on account of the receipt by it from the Company of the funds and property in such special account and before crediting to the respective claims of the Trustee, the Holders of such Securities, the Holders of the Coupons, if any, appertaining thereto and the holders of other indenture securities dividends on claims filed against the Company in bankruptcy or receivership or in cases or proceedings for reorganization or for any related or similar purpose pursuant to the Federal Bankruptcy Code or other applicable Federal or State law, but after crediting thereon receipts on account of the indebtedness represented by their respective claims from all sources other than from such dividends and from the funds and property so held in such special account. As used in this paragraph, with respect to any claim, the term 85 75 "dividends" shall include any distribution with respect to such claim, bankruptcy or receivership or cases or proceedings for reorganization or for any related or similar purpose pursuant to the Federal Bankruptcy Code or other applicable Federal or State law, whether such distribution is made in cash, securities, or other property, but shall not include any such distribution with respect to the secured portion, if any, of such claim. The court in which such bankruptcy, receivership or cases or proceedings for reorganization or for any related or similar purpose is pending shall have jurisdiction (i) to apportion between the Trustee, the Holders of such Securities, the Holders of the Coupons, if any, appertaining thereto and the holders of other indenture securities, in accordance with the provisions of this paragraph, the funds and property held in such special account and proceeds thereof, or (ii) in lieu of such apportionment in whole or in part, to give to the provisions of this paragraph due consideration in determining the fairness of the distributions to be made to the Trustee, the Holders of such Securities, the Holders of the Coupons, if any, appertaining thereto and the holders of other indenture securities with respect to their respective claims, in which event it shall not be necessary to liquidate or to appraise the value of any securities or other property held in such special account or as security for any such claim, or to make a specific allocation of such distributions as between the secured and unsecured portions of such claims, or otherwise to apply the provisions of this paragraph as a mathematical formula. Any Trustee which has resigned or been removed with respect to any series of the Securities after the beginning of such three month period shall be subject to the provisions of this Subsection with respect to such series as though such resignation or removal had not occurred. If any Trustee has so resigned or been removed prior to the beginning of such three month period, it shall be subject to the provisions with respect to such series of this Subsection if and only if the following conditions exist: (i) the receipt of property or reduction of claim, which would have given rise to the obligation to account, if such Trustee had continued as Trustee for such series, occurred after the beginning of such three month period; and (ii) such receipt of property or reduction of claim occurred within three months after such resignation or removal. (b) There shall be excluded from the operation of Subsection (a) of this sec. 9.13 a creditor relationship arising from 86 76 (1) the ownership or acquisition of securities issued under any indenture, or any security or securities having a maturity of one year or more at the time of acquisition by the Trustee; (2) advances authorized by a receivership or bankruptcy court of competent jurisdiction, or by this Indenture, for the purpose of preserving any property which shall at any time be subject to the lien of this Indenture or of discharging tax liens or other prior liens or encumbrances thereon, if notice of such advances and of the circumstances surrounding the making thereof is given to the Holders of the applicable series of Securities and the Holders of the Coupons, if any, appertaining thereto, at the time and in the manner provided in this Indenture; (3) disbursements made in the ordinary course of business in the capacity of trustee under an indenture, transfer agent, registrar, custodian, paying agent, fiscal agent or depositary, or other similar capacity; (4) an indebtedness created as a result of services rendered or premises rented; or an indebtedness created as a result of goods or securities sold in a cash transaction as defined in Subsection (c) of this sec. 9.13; (5) the ownership of stock or of other securities of a corporation organized under the provisions of Section 25(a) of the Federal Reserve Act, as amended, which is directly or indirectly a creditor of the Company; or (6) the acquisition, ownership, acceptance or negotiation of any drafts, bills of exchange, acceptances or obligations which fall within the classification of self-liquidating paper as defined in Subsection (c) of this sec. 9.13. (c) For the purposes of this Section only: (1) The term "default" means any failure to make payment in full of the principal of or interest on any of the Securities of the applicable series or upon the other indenture securities when and as such principal or interest becomes due and payable. (2) The term "other indenture securities" means securities upon which the Company is an obligor (as defined in the Trust Indenture Act of 1939) outstanding under any other indenture (i) under which the Trustee is also trustee, (ii) which contains provisions substantially similar to the provisions of this Section, and (iii) under which a default exists at 87 77 the time of the apportionment of the funds and property held in such special account. (3) The term "cash transaction" means any transaction in which full payment for goods or securities sold is made within seven days after delivery of the goods or securities in currency or in checks or other orders drawn upon banks or bankers and payable upon demand. (4) The term "self-liquidating paper" means any draft, bill of exchange, acceptance or obligation which is made, drawn, negotiated or incurred by the Company for the purpose of financing the purchase, processing, manufacturing, shipment, storage or sale of goods, wares or merchandise and which is secured by documents evidencing title to, possession of, or a lien upon, the goods, wares or merchandise or the receivables or proceeds arising from the sale of the goods, wares or merchandise previously constituting the security, provided the security is received by the Trustee simultaneously with the creation of the creditor relationship with the Company arising from the making, drawing, negotiating or incurring of the draft, bill of exchange, acceptance or obligation. (5) The term "Company" means any obligor upon the Securities. sec. 9.14. Appointment of Authenticating Agent. As long as any Securities of a series remain Outstanding, if the Corporate Trust Office of the Trustee is not located in the Borough of Manhattan, The City of New York, or otherwise upon a Company Request, there shall be an authenticating agent (the "Authenticating Agent") appointed, for such period as the Company shall elect, by the Trustee for such series of Securities to act as its agent on its behalf and subject to its direction in connection with the authentication and delivery of each series of Securities for which it is serving as Trustee. Securities of each such series authenticated by such Authenticating Agent shall be entitled to the benefits of this Indenture and shall be valid and obligatory for all purposes as if authenticated by such Trustee. Wherever reference is made in this Indenture to the authentication and delivery of Securities of any series by the Trustee for such series or to the Trustee's Certificate of Authentication, such reference shall be deemed to include authentication and delivery on behalf of the Trustee for such series except by way of original issuance by an Authenticating Agent for such series and a Certificate of Authentication executed on behalf of such Trustee by such Authenticating Agent. Such Authenticating Agent shall at all times be a corporation organized and doing business under the laws of the United States of America or of any State, authorized under such laws to exercise corporate trust powers, having a combined capital and surplus of at 88 78 least $10,000,000 and subject to supervision or examination by Federal or State authority. If the Corporate Trust Office of the Trustee is not located in the Borough of Manhattan, The City of New York, the Authenticating Agent shall have its principal office and place of business in the Borough of Manhattan, The City of New York. Any corporation into which any Authenticating Agent may be merged or converted, or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which any Authenticating Agent shall be a party, or any corporation succeeding to the corporate agency business of any Authenticating Agent, shall continue to be the Authenticating Agent with respect to all series of Securities for which it served as Authenticating Agent without the execution or filing of any paper or any further act on the part of the Trustee for such series or such Authenticating Agent. Any Authenticating Agent may at any time, and if it shall cease to be eligible shall, resign by giving written notice of resignation to the applicable Trustee and to the Company. The Trustee for any series of Securities may at any time terminate the agency of any Authenticating Agent for such series by giving written notice of termination to such Authenticating Agent and to the Company. Upon receiving such a notice of resignation or upon such a termination, or in case at any time any Authenticating Agent shall cease to be eligible in accordance with the provisions of this sec. 9.14 with respect to one or more or all series of Securities, the Trustee for such series shall upon Company Request appoint a successor Authenticating Agent, and the Company shall provide notice of such appointment to all Holders of Securities of such series or any Coupons appertaining thereto in the manner and to the extent provided in sec. 14.03. Any successor Authenticating Agent upon acceptance of its appointment hereunder shall become vested with all rights, powers, duties and responsibilities of its predecessor hereunder, with like effect as if originally named as Authenticating Agent herein. The Trustee for the Securities of such series agrees to pay to the Authenticating Agent for such series from time to time reasonable compensation for its services, and the Trustee shall be entitled to be reimbursed for such payment subject to the provisions of sec. 9.07. The Authenticating Agent for the Securities of any series shall have no responsibility or liability for any action taken by it as such at the direction of the Trustee for such series. 89 79 ARTICLE TEN. CONCERNING THE HOLDERS OF SECURITIES. sec. 10.01. Action by Holders. Whenever in this Indenture it is provided that the Holders of a specified percentage in aggregate principal amount of the Securities of any series may take any action (including the making of any demand or request, the giving of any notice, consent or waiver or the taking of any other action) the fact that at the time of taking any such action the Holders of such specified percentage have joined therein may be evidenced (a) by any instrument or any number of instruments of similar tenor executed by Holders in person or by agent or proxy appointed in writing, or (b) by the record of Holders voting in favor thereof at any meeting of such Holders duly called and held in accordance with the provisions of Article Eleven, or (c) by a combination of such instrument or instruments and any such record of such a meeting of Holders. The Company may set a record date for purposes of determining the identity of Holders entitled to vote or consent to any action by vote or consent authorized or permitted under this Indenture, which record date shall be the later of 10 days prior to the first solicitation of such consent or the date of the most recent list of Holders furnished to the Trustee pursuant to sec. 7.01 of this Indenture prior to such solicitation. If the record date is fixed, those persons who were Holders of Securities at such record date (or their duly designated proxies), and only those persons, shall be entitled to take such action by vote or consent or to revoke any vote or consent previously given, whether or not such persons continue to be Holders after such record date. No such vote or consent shall be valid or effective for more than 120 days after such record date. sec. 10.02. Proof of Execution of Instruments by Holders of Securities. Subject to the provisions of sec. 9.01, sec. 9.03 and sec. 11.05, proof of the execution of any instrument by a Holder of a Security or of any Coupon or his agent or proxy and proof of the holding by any person of any of the Securities shall be sufficient if made in the following manner: The fact and date of the execution by any such person of any instrument may be proved by the certificate of any notary public or other officer authorized to take acknowledgments of deeds, that the person executing such instrument acknowledged to him the execution thereof, or by an affidavit of a witness to such execution sworn to before any such notary or other such officer. Where such execution is by an officer of a corporation or association or a member of a partnership on behalf of such corporation, association or partnership, as the case may be, or by any other 90 80 person acting in a representative capacity, such certificate or affidavit shall also constitute sufficient proof of his authority. The ownership of Registered Securities of any series shall be proved by the Securities Register for such series or by a certificate of the Securities Registrar for such series; the ownership of Unregistered Securities of any series and Coupons shall be proved by proof of possession reasonably satisfactory to the Trustee. The record of any Holders' meeting shall be proved in the manner provided in sec. 11.06. sec. 10.03. Persons Deemed Owners. The Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name any Registered Security is registered as the owner of such Registered Security for the purpose of receiving payment of principal of, premium, if any, and (subject to sec. 3.08), if such Registered Security is a Fully Registered Security, interest, if any, on, such Registered 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. The Company, the Trustee, and any agent of the Company or the Trustee may treat the Holder of any Unregistered Security and the Holder of any Coupon, whether or not the Security to which such Coupon appertained be registered, as the absolute owner of such Security or Coupon for the purposes 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, any Paying Agent nor any Security Registrar shall be affected by notice to the contrary. All such payments so made to any Holder for the time being, or upon his order shall be valid, and, to the extent of the sum or sums so paid, effectual to satisfy and discharge the liability for moneys payable upon such Security or Coupon. sec. 10.04. Revocation of Consents; Future Holders Bound. At any time prior to (but not after) the evidencing to the Trustee, as provided in sec. 10.01, of the taking of any action by the Holders of the percentage in aggregate principal amount of the Securities specified in this Indenture in connection with such action, any Holder of a Security the number, letter or other distinguishing symbol of which is shown by the evidence to be included in the Securities the Holders of which have consented to such action may, by filing written notice with the Trustee at its principal office and upon proof of holding as provided in sec. 10.02, revoke such action so far as concerns such Security. Except as aforesaid any such action taken by the Holder of any Security shall be 91 81 conclusive and binding upon such Holder and upon all future Holders and owners of such Security and any Coupon appertaining thereto and of any Securities and Coupons issued in exchange or substitution therefor, irrespective of whether or not any notation in regard thereto is made upon such Security or Coupons or such other Security or Coupons. ARTICLE ELEVEN. HOLDERS' MEETINGS. sec. 11.01. Purposes of Meetings. A meeting of Holders of Securities of any or all series may be called at any time and from time to time pursuant to the provisions of this Article Eleven for any of the following purposes: (1) to give any notice to the Company or to the Trustee for the Securities of such series, or to give any directions to the Trustee for such series, or to consent to the waiving of any default hereunder and its consequences, or to take any other action authorized to be taken by Holders pursuant to any of the provisions of Article Eight; (2) to remove the Trustee for such series and nominate a successor Trustee pursuant to the provisions of Article Nine; (3) to consent to the execution of an indenture or indentures supplemental hereto pursuant to the provisions of sec. 12.01(g); or (4) to take any other action authorized to be taken by or on behalf of the Holders of any specified aggregate principal amount of the Securities of any one or more or all series, as the case may be, under any other provision of this Indenture or under applicable law. sec. 11.02. Call of Meetings by Trustee. The Trustee for the Securities of any series may at any time call a meeting of Holders of Securities of such series to take any action specified in sec. 11.01, to be held at such time and at such place in the Borough of Manhattan, The City of New York, or such other Place of Payment, as the Trustee for such series shall determine. Notice of every meeting of the Holders of Securities of any series, setting forth the time and the place of such meeting and in general terms the action proposed to be taken at such meeting, shall be given to Holders of Securities of such series in the manner and to the extent provided in sec. 14.03. Such notice shall be given not less than 20 nor more than 90 days prior to the date fixed for the meeting. sec. 11.03. Call of Meetings by Company or Holders. In case at any time the Company, pursuant to a resolution of its Board of Directors, or the Holders of 92 82 at least 10% in aggregate principal amount of the Outstanding Securities of any or all series, as the case may be, shall have requested the Trustee for such series to call a meeting of Holders of Securities of any or all series, as the case may be, by written request setting forth in reasonable detail the action proposed to be taken at the meeting, and the Trustee for such series shall not have given the notice of such meeting within 20 days after receipt of such request, then the Company or such Holders may determine the time and the place in the Borough of Manhattan or other Place of Payment for such meeting and may call such meeting to take any action authorized in sec. 11.01, by giving notice thereof as provided in sec. 11.02. sec. 11.04. Qualifications for Voting. To be entitled to vote at any meeting of Holders a person shall be (a) a Holder of one or more Securities with respect to which such meeting is being held or (b) a person appointed by an instrument in writing as proxy by such Holder. 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 and any representatives of the Trustee for the Securities of the series with respect to which such meeting is being held and its counsel and any representatives of the Company and its counsel. sec. 11.05. Regulations. Notwithstanding any other provisions of this Indenture, the Trustee for the Securities of any series may make such reasonable regulations as it may deem advisable for any meeting of Holders of the Securities of such series, in regard to proof of the holding of Securities of such series and of the appointment of proxies, and in regard to the appointment and duties of inspectors of votes, the submission and examination of proxies, certificates and other evidence of the right to vote, and such other matters concerning the conduct of the meeting as it shall think fit. 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 the Securities of such series as provided in sec. 11.03, in which case the Company or the Holders 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 majority vote of the meeting. Subject to the proviso in the definition of "Outstanding", at any meeting each Holder of Securities with respect to which such meeting is being held or proxy therefor shall be entitled to one vote for each 1,000 (in the currency or currency unit in which such Securities are denominated) principal amount (in 93 83 the case of Original Issue Discount Securities, such principal amount to be determined as provided in the definition of "Outstanding") of Securities held or represented by him; provided, however, that no vote shall be cast or counted at any meeting in respect of any such Security challenged as not Outstanding and ruled by the chairman of the meeting to be not Outstanding. The chairman of the meeting shall have no right to vote other than by virtue of Securities of such series held by him or instruments in writing aforesaid duly designating him as the person to vote on behalf of other Holders of such series. At any meeting of Holders, the presence of persons holding or representing Securities with respect to which such meeting is being held in an aggregate principal amount sufficient to take action on the business for the transaction of which such meeting was called shall constitute a quorum, but, if less than a quorum is present, the persons holding or representing a majority in aggregate principal amount of such Securities represented at the meeting may adjourn such meeting with the same effect, for all intents and purposes, as though a quorum had been present. Any meeting of Holders of Securities with respect to which a meeting was duly called pursuant to the provisions of sec. 11.02 or sec. 11.03 may be adjourned from time to time by a majority of such Holders present, whether or not constituting a quorum, and the meeting may be held as so adjourned without further notice. sec. 11.06. Voting. The vote upon any resolution submitted to any meeting of Holders of Securities with respect to which such meeting is being held shall be by written ballots on which shall be subscribed the signatures of such Holders or of their representatives by proxy and the serial number or numbers of the 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 in duplicate of the proceedings of each meeting of Holders shall be prepared by the secretary of the meeting and there shall be attached to said record the original reports of the inspectors of votes on any vote by ballot taken thereat and affidavits by one or more persons having knowledge of the facts setting forth a copy of the notice of the meeting and showing that said notice was mailed as provided in sec. 11.02. The record shall show the serial numbers of the Securities voting in favor of or against any resolution. The record shall be signed and verified by the affidavits of the permanent chairman and secretary of the meeting and one of the duplicates shall be delivered to the Company and the other to the Trustee to be preserved by the Trustee. 94 84 Any record so signed and verified shall be conclusive evidence of the matters therein stated. sec. 11.07. No Delay of Rights by Meeting. Nothing in this Article Eleven contained shall be deemed or construed to authorize or permit, by reason of any call of a meeting of Holders or any rights expressly or impliedly conferred hereunder to make such call, any hindrance or delay in the exercise of any right or rights conferred upon or reserved to the Trustee or to the Holders under any of the provisions of this Indenture or of the Securities of any series. ARTICLE TWELVE. SUPPLEMENTAL INDENTURES. sec. 12.01. Supplemental Indentures. The Company, when authorized by a resolution of its Board of Directors, and the Trustee for the Securities of any or all series may from time to time and at any time enter into an indenture or indentures supplemental hereto for one or more of the following purposes: (a) to evidence the succession of another corporation to the Company, or successive successions, and the assumption by the successor corporation of the covenants, agreements and obligations of the Company under the Indenture and the Securities; (b) to add to the covenants of the Company such further covenants, restrictions or conditions for the protection of the Holders of all or any series of Securities and the Coupons, if any, appertaining thereto as its Board of Directors and the Trustee for such series shall consider to be for the protection of the Holders of such Securities; (c) to cure any ambiguity or to correct or supplement any provision contained herein or in any supplemental indenture which may be defective or inconsistent with any other provision contained herein or in any supplemental indenture, or to make such other provisions in regard to matters or questions arising under this Indenture which shall not be inconsistent with the provisions of this Indenture and which shall not adversely affect the interests of the Holders of any Securities or the Coupons, if any, appertaining thereto in any material respect; (d) to establish the form or terms of Securities of any series and the Coupons, if any, appertaining thereto as permitted by sec. 3.01; 95 85 (e) to permit payment in the United States of principal, premium or interest on Unregistered Securities or of interest on Coupon Securities; (f) to evidence and provide for the acceptance of appointment hereunder by a successor Trustee with respect to the Securities of one or more series or to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, pursuant to the requirements of sec. 9.11; or (g) if and to the extent authorized by the consent (evidenced as provided in sec. 10.01) of the Holders of at least 66 2/3% in principal amount of the Outstanding Securities of each series affected by such supplemental indenture, to make such other changes in or additions to or eliminations from the Indenture as such Holders and the Company may deem necessary or advisable; provided, however, that no such supplemental indenture shall (a) without the consent of the Holder of each Outstanding Security of each such series affected thereby, (1) change the Stated Maturity of the principal of, or installment of interest, if any, on, any Security of such series, or reduce the principal amount thereof or the premium, if any, or the rate of interest, if any, thereon or change the Place of Payment, or the currency or currency unit in which any Security of such series or any premium or interest thereon is payable, or reduce the amount of the principal of an Original Issue Discount Security that would be due and payable upon an acceleration of the Maturity thereof pursuant to sec. 8.01 or adversely affect the right of repayment, if any, at the option of the Holder, or impair the right to institute suit for the enforcement of any such payment on or after the Stated Maturity thereof (or, in the case of redemption, on or after the Redemption Date), or (2) reduce the requirements of sec. 11.05 for quorum or voting, or reduce the percentage in principal amount of the Outstanding Securities of any series, the consent of whose Holders is required for any such supplemental indenture, or the consent of whose Holders is required for any waiver (of compliance with certain provisions of this Indenture or certain defaults hereunder and their consequences) provided for in this Indenture, or (3) modify any of the provisions of this sec. 12.01 or sec. 6.03, except to increase any such percentage or to provide that certain other 96 86 provisions of the Indenture cannot be modified or waived without the consent of the Holders of each Security of such series affected thereby, or (4) (i) if the Securities are Superior Indebtedness, subordinate the indebtedness evidenced by the Securities to any other indebtedness of the Company, or (ii) if the Securities are Subordinated Indebtedness, subordinate the indebtedness evidenced by the Securities to any indebtedness of the Company other than Superior Indebtedness, or (iii) if the Securities are Capital Indebtedness, subordinate the indebtedness evidenced by the Securities to any indebtedness of the Company other than Superior Indebtedness or Subordinated Indebtedness, or (b) modify, without the written consent of the Trustee, the rights, duties or immunities of the Trustee. Any such supplemental indenture, and this Indenture as so supplemented, shall conform to the requirements of the Trust Indenture Act of 1939, as amended and in force at the date of execution of such supplemental indenture. A supplemental indenture which changes or eliminates any covenant or other provision of this Indenture which has expressly been included solely for the benefit of one or more particular series of Securities and the Coupons, if any, appertaining thereto, or which modifies the rights of the Holders of Securities of such series or any Coupons appertaining thereto with respect to such covenant or other provision, shall be deemed not to affect the rights under this Indenture of the Holders of Securities of any other series or any Coupons appertaining thereto. The Trustee with respect to any series of Securities affected by such supplemental indenture is hereby authorized to join with the Company in the execution of any such supplemental indenture, and to make any further appropriate agreements and stipulations which may be therein contained, but such Trustee shall not be obligated to enter into any such supplemental indenture which affects such Trustee's own rights, duties or immunities under this Indenture or otherwise. For purposes of this sec. 12.01, if the Securities of any series are issuable upon the exercise of warrants, each holder of an unexercised and unexpired warrant with respect to such series shall be deemed to be a Holder of Outstanding Securities of such series in the amount issuable upon the exercise of such warrant. For such purposes, the ownership of any such warrant shall be 97 87 determined by the Company in a manner consistent with customary commercial practices. The Trustee for such series shall be entitled to rely on an Officers' Certificate as to the principal amount of Securities of such series in respect of which consents shall have been executed by holders of such warrants. sec. 12.02. Notice of Supplemental Indenture. Promptly after the execution by the Company and the appropriate Trustee of any supplemental indenture pursuant to sec. 12.01(g), the Company shall notify as provided in sec. 14.03 all Holders of any series of Securities and of any Coupons appertaining thereto affected by such supplemental indenture as to the general terms the substance of such supplemental indenture. sec. 12.03. Effect of Supplemental Indenture. Upon the execution of any supplemental indenture pursuant to the provisions of this Article Twelve, this Indenture shall be and be deemed to be modified and amended in accordance therewith, but only with regard to the Securities of each series affected by such supplemental indenture, and the respective rights, limitations of rights, obligations, duties and immunities under this Indenture of the Trustee for the Securities of such series, the Company and Holders of any Securities of such series or of any Coupons appertaining thereto shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modifications and amendments, and all the terms and conditions of any such supplemental indenture shall be and be deemed to be part of the terms and conditions of this Indenture for any and all purposes with regard to the Securities of such series and of any Coupons appertaining thereto. sec. 12.04. Notation on Securities and Coupons. Securities of any series (including any Coupons appertaining thereto) affected by any supplemental indenture which are authenticated and delivered after the execution of such supplemental indenture pursuant to the provisions of this Article Twelve may bear a notation in form approved by the Trustee for such series as to any matter provided for in such supplemental indenture. If the Company or the Trustee shall so determine, new Securities of any series and any Coupons appertaining thereto so modified as to conform, in the opinion of the Trustee and the Board of Directors of the Company, to any modification of this Indenture contained in any such supplemental indenture may be prepared by the Company, authenticated by the Trustee and delivered in exchange for the Securities of such series and any Coupons appertaining thereto then Outstanding. sec. 12.05. Issuance of Securities by Successor Corporation. In case the Company shall be consolidated with or merged into any other corporation or 98 88 corporations, or shall convey or transfer all or substantially all its property as an entirety, the successor corporation formed by such consolidation or into which the Company shall have been merged or which shall have received a conveyance or transfer as aforesaid, upon causing to be executed and delivered the supplemental indenture referred to in sec. 12.01(a), shall succeed to and be substituted for the Company with the same effect as if it had been named herein as the party of the first part and in all of the Securities and the Coupons, if any, appertaining thereto as obligor, and thereupon and thereafter such successor corporation may cause to be executed, either in its own name or in the name of Associates Corporation of North America, and delivered to the appropriate Trustee for authentication, any or all of the Securities and the Coupons, if any, appertaining thereto issuable hereunder; and upon the order of such successor corporation in lieu of the Company, and subject to all the terms, conditions and restrictions in this Indenture prescribed, the Trustee for the Securities of the appropriate series shall authenticate and deliver any Securities of such series and the Coupons, if any, appertaining thereto which shall have been previously executed and delivered by the Company to the Trustee for authentication, and any Securities and the Coupons, if any, appertaining thereto which such successor corporation shall thereafter, in accordance with the provisions of this Indenture, cause to be executed and delivered to the Trustee for such purpose. Such change in phraseology and form (but not in substance) may be made in such Securities and the Coupons, if any, appertaining thereto as may be appropriate in view of such consolidation or merger or conveyance or transfer. All such Securities and the Coupons, if any, appertaining thereto when issued by such successor corporation shall in all respects have the same legal rank as the Securities and the Coupons, if any, appertaining thereto theretofore or thereafter authenticated and delivered in accordance with the terms of this Indenture and issued, as though all of such Securities and the Coupons, if any, appertaining thereto had been issued at the date of the execution hereof. 99 89 ARTICLE THIRTEEN. SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED MONEYS. sec. 13.01 Satisfaction and Discharge. If (a) the Company shall deliver to the Trustee for the Securities of any series for cancellation all Securities of all series and the Coupons, if any, appertaining thereto for which such Trustee is Trustee theretofore authenticated (other than any Securities of any such series and the Coupons, if any, appertaining thereto which shall have been destroyed, lost or stolen) and not theretofore cancelled, or (b) all the Securities of all such series and the Coupons, if any, appertaining thereto not theretofore cancelled or delivered to the applicable Trustee for cancellation shall have become due and payable, or are by their terms to become due and payable within one year or are to be called for redemption within one year under arrangement satisfactory to the Trustee for the giving of notice of redemption, and the Company shall deposit with the Trustee as trust funds the entire amount sufficient to pay at maturity or upon redemption in the currency or currency unit required all of the Securities of all such series and the Coupons, if any, appertaining thereto (other than any Securities and the Coupons, if any, appertaining thereto which shall have been destroyed, lost or stolen and in lieu of or substitution for which other Securities and the Coupons, if any, appertaining thereto, shall have been authenticated and delivered) not theretofore cancelled or delivered to the Trustee for cancellation, including principal due or to become due to such date of Maturity or Redemption Date, as the case may be, and if in either case the Company shall also pay or cause to be paid all other sums payable hereunder by the Company, then this Indenture shall cease to be of further effect with respect to all such series (except as to any surviving rights of registration of transfer or exchange of Securities herein expressly provided for) and the Trustee, on demand of the Company accompanied by an Officers' Certificate, complying with the provisions of sec. 1.03, stating that all conditions precedent relating to the satisfaction and discharge of the Indenture with respect to all such series (except as to any surviving rights of registration of transfer or exchange of Securities herein expressly provided for) have been complied with, and an Opinion of Counsel, complying with the provisions of sec. 1.03, stating that in the opinion of such counsel such conditions precedent have been complied with, and at the cost and expense of the Company, shall execute proper instruments acknowledging satisfaction of and discharging this Indenture with respect to all such series (except as to any surviving rights of registration of transfer or exchange of Securities herein expressly provided for) the Company, however, hereby agreeing to reimburse the Trustee in Dollars for 100 90 any costs or expenses thereafter reasonably and properly incurred by the Trustee in connection with this Indenture or the Securities. sec. 13.02. Application of Moneys. All moneys deposited with the Trustee for the Securities of any series and the Coupons, if any, appertaining thereto pursuant to sec. 13.01 shall be held in trust by the Trustee and applied by it to the payment, either directly or through any Paying Agent for such series (including the Company acting as its own Paying Agent), to the Holders of the particular Securities and the Coupons, if any, appertaining thereto for the payment or redemption of which such moneys have been deposited with the Trustee, of all sums due and to become due thereon for principal, premium, if any, and interest, if any. sec. 13.03. Repayment of Moneys by Paying Agents. Except as provided in sec. 13.04, upon the satisfaction and discharge of this Indenture with respect to the Securities of any series and the Coupons, if any, appertaining thereto all moneys with respect to such series then held by any Paying Agent for such series under the provisions of this Indenture shall, upon demand of the Company, be repaid to it and thereupon such Paying Agent shall be released from all further liability with respect to such moneys. sec. 13.04. Unclaimed Moneys. Any moneys deposited with the Trustee for the Securities of any series and the Coupons, if any, appertaining thereto for the payment of the principal of, premium, if any, or interest, if any, on Securities of such series and the Coupons, if any, appertaining thereto and which shall not be applied but shall remain unclaimed by the Holders of Securities of such series and the Coupons, if any, appertaining thereto for two years after the date upon which such payment shall have become due and payable, shall be repaid to the Company by the Trustee on demand; and the Holder of any of such Securities or the Coupons, if any, appertaining thereto entitled to receive such payment shall thereafter look only to the Company for the payment thereof; provided, however, that the Trustee, before making any such repayment, shall at the expense of the Company cause to be published once a week for two successive weeks (in each case on any day of the week) in an Authorized Newspaper, a notice that said moneys have not been so applied and that after a date named therein any unclaimed balance of said moneys then remaining will be returned to the Company. 101 91 ARTICLE FOURTEEN. MISCELLANEOUS PROVISIONS. sec. 14.01. Limitation of Individual Liability. No recourse under or upon any obligation, covenant or agreement of this Indenture, or of any Security or Coupon, or for any claim based thereon or otherwise in respect thereof, shall be had against any incorporator, stockholder, officer or director, as such, past, present or future, of the Company or of any successor corporation, either directly or through the Company, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise; it being expressly understood that this Indenture and the obligations issued hereunder are solely corporate obligations, and that no such personal liability whatever shall attach to, or is or shall be incurred by, the incorporators, stockholders, officers or directors, as such, of the Company or of any successor corporation, or any of them, because of the creation of the indebtedness hereby authorized, or under or by reason of the obligations, covenants or agreements contained in this Indenture or in any of the Securities or Coupons or implied therefrom; and that any and all such personal liability of every name and nature, either at common law or in equity or by constitution or statute, of, and any and all such rights and claims against, every such incorporator, stockholder, officer or director, as such, because of the creation of the indebtedness hereby authorized, or under or by reason of the obligations, covenants or agreements contained in this Indenture or in any of the Securities or Coupons or implied therefrom, are hereby expressly waived and released as a condition of, and as a consideration for, the execution of this Indenture and the issue of such Securities and Coupons, if any. sec. 14.02. Successors. All the covenants, stipulations, promises and agreements in this Indenture contained by or in behalf of the Company shall bind its successors and assigns, whether so expressed or not. sec. 14.03. Notice to Holders; Waiver. Where this Indenture provides for notice to Holders of any event, (1) if any of the Securities affected by such event are Fully Registered Securities, such notice shall be sufficiently given (unless otherwise herein expressly provided) if in writing and mailed by first class mail, postage prepaid, to such Holders as their names and addresses appear in the Securities Register within the time prescribed and (2) if any of the Securities affected by such event are Unregistered Securities, or Coupon Securities, such notice shall be sufficiently given (unless otherwise herein expressly provided) if in writing and mailed by first class mail, postage prepaid, to such Holders in the manner and to the extent provided in sec. 7.04(c) and if 102 92 published in an Authorized Newspaper or Newspapers in such city or cities as may be provided elsewhere in this Indenture or specified as contemplated by sec. 3.01 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. 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 on such waiver. In any case where notice to Holders is given by mail, neither the failure to mail such notice, nor any defect in any notice so mailed to any particular Holder shall affect the sufficiency of such notice with respect to other Holders, and any notice which is mailed in the manner herein provided shall be conclusively presumed to have been duly given. In case by reason of the suspension of publication of any Authorized Newspapers or by reason of any other cause it shall be impracticable to publish any notice to Holders of Unregistered Securities or of Coupons as provided above then said notification to Holders of Unregistered Securities or of Coupons as shall be given with the approval of the Trustee shall constitute sufficient notice to such Holders for every purpose hereunder. sec. 14.04. Addresses for Notices. Any notice or demand which by any provision of this Indenture is required or permitted to be given or served by the Trustee for the Securities of any series or by the Holders of Securities of any series or of any Coupons appertaining thereto on the Company may be given or served by registered mail addressed (until another address is filed by the Company with the Trustee) as follows: ASSOCIATES FIRST CAPITAL CORPORATION Attention: General Counsel, 250 E. Carpenter Freeway, Irving, Texas 75062. Any notice, direction, request or demand by any Holder of Securities of any series to or upon the Trustee for such series or of any Coupons appertaining thereto shall be deemed to have been sufficiently given or made, for all purposes, if given or made at the Corporate Trust Office of such Trustee, and, in respect of Unregistered Securities or Coupons, at the corporate trust office of the Trustee referred to in sec. 6.02(1). Any notice or demand required or permitted under this Indenture shall be in the English language, except that any published notice may be in the official language of the country of publication. sec. 14.05. Cross References. All references herein to "Articles" and other subdivisions are to the corresponding Articles or other subdivisions of this Indenture; references by the symbol "sec." are to corresponding Sections of this 103 93 Indenture; and the words "herein", "hereof", "hereby", "hereunder", "hereinbefore" and "hereinafter" and other words of similar purport refer to this Indenture generally and not to any particular Article, Section or other subdivision hereof. sec. 14.06. Counterparts. This Indenture may be executed in any number of counterparts, each of which shall be an original; but such counterparts shall together constitute but one and the same instrument. sec. 14.07. Headings Not to Affect Construction. The headings of the Articles, Sections and other subdivisions hereof herein are for convenience only and shall not affect the construction hereof. sec. 14.08. Trust Indenture Act to Govern. If any provision hereof limits, qualifies or conflicts with a provision of the Trust Indenture Act that is required under such Act to be a part of and govern this Indenture, the latter provision shall control. If any provision of this Indenture modifies or excludes any provision of the Trust Indenture Act that may be so modified or excluded, the latter provision shall be deemed to apply to this Indenture as so modified or to be excluded, as the case may be. sec. 14.09. Legal Holidays. In any case where the date of maturity of interest on or principal of (or premium, if any) on the Securities or Coupons or the date fixed for redemption or repayment of any Security shall not be a Business Day at any Place of Payment with respect to Securities of that series then (notwithstanding any other provisions of this Indenture or of the Security or Coupons) payment of such interest on or principal of (or premium, if any, on) the Securities and Coupons need not be made on such date in such Place of Payment but may be made on the next succeeding Business Day in such Place of Payment with the same force and effect as if made on the date of maturity or the date fixed for redemption or repayment, as the case may be, and no interest shall accrue for the period from and after such date. SEC. 14.10. APPLICABLE LAW. THIS INDENTURE AND EACH SECURITY FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. 104 94 ARTICLE FIFTEEN SUBORDINATION OF SECURITIES. sec. 15.01. Subordination. Anything in this Indenture or the Securities of any series, or any Coupons appertaining thereto, to the contrary notwithstanding, the Indebtedness evidenced by the Securities of all series and any Coupons appertaining thereto shall be subordinate and junior in right of payment in all respects to all Indebtedness of the Company, except (i) other Subordinated Indebtedness of the Company and (ii) Capital Indebtedness of the Company, whether outstanding at the date of this Indenture or incurred after the date of this Indenture. Such Indebtedness of the Company to which the Securities and any Coupons appertaining thereto are subordinate and junior is sometimes herein referred to as "Superior Indebtedness". Without limiting the effect of the foregoing, "subordinate" and "junior" as used herein shall include within their meanings the following: that (i) in the event of any insolvency or bankruptcy proceedings, and any receivership, liquidation, reorganization or other similar proceedings in connection therewith, relative to the Company or its creditors or its property, and in the event of any proceedings for voluntary liquidation, dissolution or other winding up of the Company, whether or not involving insolvency or bankruptcy proceedings, then all principal and interest on all Superior Indebtedness shall first be paid in full, or such payment be provided for, before any payment on account of principal or interest is made upon the Indebtedness evidenced by the Securities of any series and any Coupons appertaining thereto, and in any such proceedings any payment or distribution of any kind or character, whether in cash or property or securities, which may be payable or deliverable in respect of the Securities of any series and any Coupons appertaining thereto shall be paid or delivered directly to the holders of such Superior Indebtedness for application in payment thereof, unless and until such Superior Indebtedness shall have been paid and satisfied in full or such payment and satisfaction shall have been provided for; provided, however, that (x) in the event that payment or delivery of such cash, property or securities to the Holders of the Securities of any series and to the Holders of any Coupons appertaining thereto is authorized by an order or decree giving effect, and stating in such order or decree that effect is given, to the subordination of the Securities of all series and any Coupons appertaining thereto to Superior Indebtedness, and made by a court of competent jurisdiction in a reorganization proceeding under any applicable bankruptcy law, no payment or delivery of such cash, property or securities payable or deliverable with respect to the Securities of any series and any 105 95 Coupons appertaining thereto need be made to the holders of Superior Indebtedness; and (y) no such delivery need be made of securities which are issued pursuant to voluntary reorganization, dissolution or liquidation proceedings, or upon any merger, consolidation, sale, lease, transfer or other disposal not prohibited by sec. 6.02 of this Indenture, by the Company, as reorganized, or by the New Company, and which securities are subordinate and junior to the payment of all Superior Indebtedness then outstanding; and (ii) in the event that pursuant to Article Eight of this Indenture the Securities of any series are declared due and payable because of the occurrence of any Event of Default described in Article Eight of this Indenture (under circumstances when the provisions of the foregoing clause (i) shall not be applicable), the Holders of Securities of such series and the Holders of any Coupons appertaining thereto, and the Trustee, on their behalf (but not with respect to its own compensation and expenses), shall be entitled to payment only after there shall first have been paid in full the Superior Indebtedness outstanding at the time Securities of such series and any Coupons appertaining thereto so become due and payable because of such Event of Default, or such payment shall have been provided for. No present or future holder of Superior Indebtedness shall be prejudiced in his right to enforce subordination of the Securities of all series and any Coupons appertaining thereto by any act or failure to act on the part of the Company. The provisions of this Article Fifteen are solely for the purpose of defining the relative rights of the holders of Superior Indebtedness on the one hand, and the Holders of the Securities of all series and the Holders of any Coupons appertaining thereto on the other hand, and nothing herein shall impair, as between the Company and the Holder of any Security of any series or of any Coupon appertaining thereto, the obligation of the Company, which is unconditional and absolute, to pay to the Holder thereof the principal, premium, if any, and interest, if any, thereon in accordance with its terms, nor shall anything herein prevent the Holder of a Security of any series or of any Coupon appertaining thereto or the Trustee on behalf of the Holders of the Securities of all series or of any Coupons appertaining thereto from exercising all remedies otherwise permitted by applicable law or hereunder upon default hereunder, subject to the rights, if any, under this Article Fifteen of holders of Superior Indebtedness to receive cash, property or securities otherwise payable or deliverable to the Holders of the Securities of any series or of any Coupons appertaining thereto. sec. 15.02. Securities May be Paid Prior to Dissolution, etc. Nothing contained in this Article Fifteen or elsewhere in this Indenture, or in the Securities of any series or any Coupons appertaining thereto, shall prevent (a) the 106 96 Company, at any time except under the conditions described in sec. 15.01 or during the pendency of any dissolution or winding up or total or partial liquidation or reorganization proceedings therein referred to, from making payments at any time of principal of and premium, if any, or interest, if any, on Securities of any series or payments of any Coupons appertaining thereto or from depositing with the Trustee or any Paying Agent moneys for such payments, or (b) the application by the Trustee or any Paying Agent of any moneys deposited with it under this Indenture to the payment of or on account of the principal of and premium, if any, or interest, if any, on Securities of any series or payments of any Coupons appertaining thereto to the Holders of Securities of such series or of any Coupon appertaining thereto entitled thereto if such payment would not have been prohibited by the provisions of sec. 15.01 on the date such moneys were so deposited. Notwithstanding the provisions of sec. 15.01 or any other provision of this Indenture, the Trustee and any Paying Agent shall not be charged with knowledge of the existence of any Superior Indebtedness or of any facts which would prohibit the making of any payment of moneys to or by the Trustee or such Paying Agent, unless and until the Trustee or such Paying Agent shall have received written notice thereof from the Company or from a holder of such Superior Indebtedness; and, prior to the receipt of any such written notice, the Trustee shall be entitled in all respects to assume that no such facts exist; provided, that, if prior to the date upon which by the terms hereof any such moneys may become payable for any purpose (including, without limitation, the payment of the principal of and premium, if any, or interest, if any, on the Securities of any series or the payment of any Coupons appertaining thereto) the Trustee or such Paying Agent shall not have received with respect to such moneys the notice provided for in this sec. 15.02, then, anything herein contained to the contrary notwithstanding, the Trustee and such Paying Agent shall have full power and authority to receive such moneys and apply the same to the purpose for which they were received, and shall not be affected by any notice to the contrary which may be received by it after such date. sec. 15.03. Rights of the Holders of Superior Indebtedness Not to be Impaired. Neither the Trustee nor any Paying Agent shall be deemed to owe any fiduciary duty to the holders of Superior Indebtedness, and shall not be liable to any such holders if either shall mistakenly pay over or distribute to or on behalf of Holders of Securities of any series or of any Coupons appertaining thereto or the Company moneys or assets to which any holders of Superior Indebtedness shall be entitled by virtue of this Article Fifteen. 107 97 The Trustee shall be entitled to all the rights set forth in this Article Fifteen with respect to any Superior Indebtedness which may at any time be held by it, to the same extent as any other holder of Superior Indebtedness, and nothing in sec. 9.13, or elsewhere in this Indenture, shall deprive the Trustee of any of its rights as such holder. sec. 15.04. Authorization to Trustee to Take Action to Effectuate Subordination. Each Holder of a Security of any series by his acceptance thereof authorizes and directs the Trustee in his behalf to take such action as may be necessary or appropriate to effectuate the subordination as provided in this Article Fifteen and appoints the Trustee his attorney-in-fact for any and all such purposes. EX-4.2 5 FORM OF INDENTURE FOR SENIOR SECURITIES 1 EXHIBIT 4.2 ================================================================================ ASSOCIATES FIRST CAPITAL CORPORATION AND THE CHASE MANHATTAN BANK, Trustee -------------- INDENTURE -------------- Dated as of June 1, 1998 -------------- Senior Securities ================================================================================ 2 INDENTURE, dated as of June 1, 1998, between ASSOCIATES FIRST CAPITAL CORPORATION, a Delaware corporation (the "Company"), and The Chase Manhattan Bank, a New York banking corporation, as Trustee (the "Trustee"). RECITALS OF THE COMPANY The Company is authorized to borrow money for its corporate purposes and to issue debentures, notes or other evidences of indebtedness therefor; and for its corporate purposes, the Company has determined to make and issue its debentures, notes or other evidences of indebtedness to be issued in one or more series (the "Securities"), as hereinafter provided, up to such principal amount or amounts as may from time to time be authorized by or pursuant to the authority granted in one or more resolutions of the Board of Directors. All things necessary to make this Indenture a valid agreement of the Company, in accordance with its terms, have been done. NOW, THEREFORE, THIS INDENTURE WITNESSETH: That, in consideration of the premises and of the mutual covenants herein contained and of the purchase and acceptance of the Securities by the holders thereof and of the sum of One Dollar to the Company duly paid by the Trustee at or before the ensealing and delivery of these presents, and for other valuable consideration, the receipt whereof is hereby acknowledged, and in order to declare the terms and conditions upon which the Securities are to be issued, IT IS HEREBY COVENANTED, DECLARED AND AGREED, by and between the parties hereto, that all the Securities are to be executed, authenticated and delivered subject to the further covenants and conditions hereinafter set forth; and the Company, for itself and its successors, does hereby covenant and agree to and with the Trustee and its successors in said trust, for the benefit of those who shall hold the Securities, or any of them, as follows: PARAGRAPH A. INCORPORATION BY REFERENCE Articles One through Fourteen, other than clauses (ii) and (iii) of Section 12.01(g)(4), of the Associates First Capital Corporation Standard Multiple-Series Indenture Provisions dated as of June 1, 1998 (herein called the "Standard Provisions"), are hereby incorporated herein by reference with the same force and effect as though fully set out herein. PARAGRAPH B. ADDITIONAL PROVISIONS The following provisions, which constitute part of this Indenture, are numbered to conform with the format of the Standard Provisions: Section 9.07. Compensation and Reimbursement *** (h) When Trustee incurs expenses or renders services in connection with an Event of Default specified in Section 8.01(4) or Section 8.01(5), such expenses (including the fees and expenses of its counsel) and the compensation for such services are intended to constitute expenses of administration under any bankruptcy or insolvency law or any law affecting creditors rights generally. In the event that the Trustee is also acting as Paying Agent or Registrar hereunder, the rights and protections afforded to the Trustee hereunder shall also be afforded to such paying Agent or Registrar. 3 Section 9.15. Other Matters Concerning the Trustee. At the date of this Indenture, the Corporate Trust Office of the Trustee is located at 450 West 33rd Street, 15th Floor, New York, NY 10001, Attn: Corporate Trust Department. Anything in Section 6.02(l) to the contrary notwithstanding, the office or agency of the Company in the Borough of Manhattan, The City of New York, where Securities of any series may be presented or surrendered for payment, where Securities of such series may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Company in respect of the Securities of such series and this Indenture may be served, shall initially be the corporate trust facility of the Trustee in the Borough of Manhattan, The City of New York, which at the date of this Indenture is located at Chase Institutional Trust Window, 1 Chase Manhattan Plaza, 1B, New York, New York 10081. Section 12.01. Supplemental Indentures *** (h) Prior to entering into any supplemental indenture, the Trustee shall be entitled to receive (i) an opinion of the Company's corporate counsel addressed to the Trustee as to matters the Trustee may reasonably request and (ii) an Officer's Certificate of the Company attesting to such matters as the Trustee may reasonably request. Section 14.10. Applicable Law. THIS INDENTURE AND EACH SECURITY FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. IN WITNESS WHEREOF, ASSOCIATES FIRST CAPITAL CORPORATION has caused this Indenture to be signed in its corporate name by its Chairman of the Board, any Vice Chairman, its President or any Vice President, and its corporate seal to be affixed hereunto, and the same to be attested by the signature of its Secretary or an Assistant Secretary; and THE CHASE MANHATTAN BANK in evidence of its acceptance of the trust hereby created, has caused this Indenture to be signed in its corporate name, and its corporate seal to be affixed hereunto, and the same to be attested, as of the day and year first above written. ASSOCIATES FIRST CAPITAL CORPORATION [SEAL] By: ---------------------------- Title: Attest: ------------------------ Title: THE CHASE MANHATTAN BANK, as Trustee [SEAL] By: ---------------------------- Title: Attest: ----------------------- Title: 2 EX-4.3 6 FORM OF INDENTURE FOR SUBORDINATED SECURITIES 1 EXHIBIT 4.3 ================================================================================ ASSOCIATES FIRST CAPITAL CORPORATION AND THE CHASE MANHATTAN BANK, Trustee -------------- INDENTURE -------------- Dated as of June 1, 1998 -------------- Subordinated Securities ================================================================================ 2 INDENTURE, dated as of June 1, 1998, between ASSOCIATES FIRST CAPITAL CORPORATION, a Delaware corporation (the "Company"), and THE CHASE MANHATTAN BANK, a New York banking corporation, as Trustee (the "Trustee"). RECITALS OF THE COMPANY The Company is authorized to borrow money for its corporate purposes and to issue debentures, notes or other evidences of indebtedness therefor; and for its corporate purposes, the Company has determined to make and issue its debentures, notes or other evidences of indebtedness to be issued in one or more series (the "Securities"), as hereinafter provided, up to such principal amount or amounts as may from time to time be authorized by or pursuant to the authority granted in one or more resolutions of the Board of Directors. All things necessary to make this Indenture a valid agreement of the Company, in accordance with its terms, have been done. NOW, THEREFORE, THIS INDENTURE WITNESSETH: That, in consideration of the premises and of the mutual covenants herein contained and of the purchase and acceptance of the Securities by the holders thereof and of the sum of One Dollar to the Company duly paid by the Trustee at or before the ensealing and delivery of these presents, and for other valuable consideration, the receipt whereof is hereby acknowledged, and in order to declare the terms and conditions upon which the Securities are to be issued, IT IS HEREBY COVENANTED, DECLARED AND AGREED, by and between the parties hereto, that all the Securities are to be executed, authenticated and delivered subject to the further covenants and conditions hereinafter set forth; and the Company, for itself and its successors, does hereby covenant and agree to and with the Trustee and its successors in said trust, for the benefit of those who shall hold the Securities, or any of them, as follows: PARAGRAPH A. INCORPORATION BY REFERENCE Articles One through Fifteen, other than clauses (i) and (iii) of Section 12.01(g)(4), of the Associates First Capital Corporation Standard Multiple-Series Indenture Provisions dated as of June 1, 1998 (herein called the "Standard Provisions"), are hereby incorporated herein by reference with the same force and effect as though fully set out herein. PARAGRAPH B. ADDITIONAL PROVISIONS The following provisions, which constitute part of this Indenture, are numbered to conform with the format of the Standard Provisions: Section 9.07. Compensation and Reimbursement *** (h) When Trustee incurs expenses or renders services in connection with an Event of Default specified in Section 8.01(4) or Section 8.01(5), such expenses (including the fees and expenses of its counsel) and the compensation for such services are intended to constitute expenses of administration under any bankruptcy or insolvency law or any law affecting creditors rights generally. In the event that the Trustee is also acting as Paying Agent or Registrar hereunder, the rights and protections afforded to the Trustee hereunder shall also be afforded to such paying Agent or Registrar. 3 Section 9.15. Other Matters Concerning the Trustee. At the date of this Indenture, the Corporate Trust Office of the Trustee is located at 450 West 33rd Street, 15th Floor, New York, NY 10001, Attn: Corporate Trust Department. Anything in Section 6.02(l) to the contrary notwithstanding, the office or agency of the Company in the Borough of Manhattan, The City of New York, where Securities of any series may be presented or surrendered for payment, where Securities of such series may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Company in respect of the Securities of such series and this Indenture may be served, shall initially be the corporate trust facility of the Trustee in the Borough of Manhattan, The City of New York, which at the date of this Indenture is located at Chase Institutional Trust Window, 1 Chase Manhattan Plaza, 1B, New York, New York 10081. Section 12.01. Supplemental Indentures *** (h) Prior to entering into any supplemental indenture, the Trustee shall be entitled to receive (i) an opinion of the Company's corporate counsel addressed to the Trustee as to matters the Trustee may reasonably request and (ii) an Officer's Certificate of the Company attesting to such matters as the Trustee may reasonably request. Section 14.10. Applicable Law. THIS INDENTURE AND EACH SECURITY FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. IN WITNESS WHEREOF, ASSOCIATES CORPORATION OF NORTH AMERICA has caused this Indenture to be signed in its corporate name by its Chairman of the Board, any Vice Chairman, its President or any Vice President, and its corporate seal to be affixed hereunto, and the same to be attested by the signature of its Secretary or an Assistant Secretary; and THE CHASE MANHATTAN BANK in evidence of its acceptance of the trust hereby created, has caused this Indenture to be signed in its corporate name, and its corporate seal to be affixed hereunto, and the same to be attested, as of the day and year first above written. ASSOCIATES FIRST CAPITAL CORPORATION [SEAL] By: ----------------------------------- Title: Attest: ------------------------------ Title: THE CHASE MANHATTAN BANK, as Trustee [SEAL] By: ----------------------------------- Title: Attest: ------------------------------ Title: 2 EX-25.1 7 FORM T-1 STATEMENT OF ELIGIBILITY OF TRUSTEE 1 EXHIBIT 25.1 ------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM T-1 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE --------------------------------------- CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) ---- --------------------------------------- THE CHASE MANHATTAN BANK (Exact name of trustee as specified in its charter) NEW YORK 13-4994650 (State of incorporation (I.R.S. employer if not a national bank) identification No.) 270 PARK AVENUE NEW YORK, NEW YORK 10017 (Address of principal executive offices) (Zip Code) William H. McDavid General Counsel 270 Park Avenue New York, New York 10017 Tel: (212) 270-2611 (Name, address and telephone number of agent for service) ------------------------------------------------------- ASSOCIATES FIRST CAPITAL CORPORATION (Exact name of obligor as specified in its charter) DELAWARE 06-0876639 (State or other jurisdiction of (I.R.S. employer incorporation or organization) identification No.) 250 EAST CARPENTER FREEWAY IRVING, TEXAS 75062-2729 (Address of principal executive offices) (Zip Code) ---------------------------------------------- SENIOR DEBT SECURITIES (Title of the indenture securities) ------------------------------------------------------------- 2 GENERAL Item 1. General Information. Furnish the following information as to the trustee: (a) Name and address of each examining or supervising authority to which it is subject. New York State Banking Department, Suite 2310, 5 Empire State Plaza, Albany, New York 12223. Board of Governors of the Federal Reserve System 20th and C Street NW, Washington, D.C., 20551 Federal Reserve Bank of New York, District No. 2, 33 Liberty Street, New York, N.Y. 10045. Federal Deposit Insurance Corporation, 550 Seventeenth Street NW Washington, D.C., 20429. (b) Whether it is authorized to exercise corporate trust powers. Yes. Item 2. Affiliations with the Obligor. If the obligor is an affiliate of the trustee, describe each such affiliation. None. - 2 - 3 Item 16. List of Exhibits List below all exhibits filed as a part of this Statement of Eligibility. 1. A copy of the Articles of Association of the Trustee as now in effect, including the Organization Certificate and the Certificates of Amendment dated February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982, February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1 filed in connection with Registration Statement No. 333-06249, which is incorporated by reference). 2. A copy of the Certificate of Authority of the Trustee to Commence Business (see Exhibit 2 to Form T-1 filed in connection with Registration Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in connection with the merger of Chemical Bank and The Chase Manhattan Bank (National Association), Chemical Bank, the surviving corporation, was renamed The Chase Manhattan Bank). 3. None, authorization to exercise corporate trust powers being contained in the documents identified above as Exhibits 1 and 2. 4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1 filed in connection with Registration Statement No. 333-06249, which is incorporated by reference). 5. Not applicable. 6. The consent of the Trustee required by Section 321(b) of the Act (see Exhibit 6 to Form T-1 filed in connection with Registration Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in connection with the merger of Chemical Bank and The Chase Manhattan Bank (National Association), Chemical Bank, the surviving corporation, was renamed The Chase Manhattan Bank). 7. A copy of the latest report of condition of the Trustee, published pursuant to law or the requirements of its supervising or examining authority. 8. Not applicable. 9. Not applicable. SIGNATURE Pursuant to the requirements of the Trust Indenture Act of 1939 the Trustee, The Chase Manhattan Bank, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of New York and State of New York, on the 2ND day of JUNE, 1998. THE CHASE MANHATTAN BANK By /s/ ANDREW M. DECK ------------------------------- ANDREW M. DECK VICE PRESIDENT - 3 - 4 Exhibit 7 to Form T-1 Bank Call Notice RESERVE DISTRICT NO. 2 CONSOLIDATED REPORT OF CONDITION OF The Chase Manhattan Bank of 270 Park Avenue, New York, New York 10017 and Foreign and Domestic Subsidiaries, a member of the Federal Reserve System, at the close of business March 31, 1998, in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.
DOLLAR AMOUNTS ASSETS IN MILLIONS Cash and balances due from depository institutions: Noninterest-bearing balances and currency and coin............................................. $ 12,037 Interest-bearing balances .................................... 4,054 Securities: ...................................................... Held to maturity securities........................................ 2,340 Available for sale securities...................................... 50,134 Federal funds sold and securities purchased under agreements to resell ......................................... 24,982 Loans and lease financing receivables: Loans and leases, net of unearned income..... $127,958 Less: Allowance for loan and lease losses.... 2,797 Less: Allocated transfer risk reserve ....... 0 -------- Loans and leases, net of unearned income, allowance, and reserve ....................................... 125,161 Trading Assets .................................................... 61,820 Premises and fixed assets (including capitalized leases)....................................................... 2,961 Other real estate owned ........................................... 347 Investments in unconsolidated subsidiaries and associated companies.......................................... 242 Customers' liability to this bank on acceptances outstanding .................................................. 1,380 Intangible assets ................................................. 1,549 Other assets ...................................................... 11,727 -------- TOTAL ASSETS ...................................................... $298,734 ========
- 4 - 5 LIABILITIES Deposits In domestic offices ........................................ $96,682 Noninterest-bearing .................. $38,074 Interest-bearing ..................... 58,608 ------- In foreign offices, Edge and Agreement, subsidiaries and IBF's ..................................... 72,630 Noninterest-bearing .................. $ 3,289 Interest-bearing ..................... 69,341 Federal funds purchased and securities sold under agreements to repurchase ........................................ 42,735 Demand notes issued to the U.S. Treasury ........................ 872 Trading liabilities ............................................. 45,545 Other borrowed money (includes mortgage indebtedness and obligations under capitalized leases): With a remaining maturity of one year or less .............. 4,454 With a remaining maturity of more than one year through three years.................................... 231 With a remaining maturity of more than three years.......... 106 Bank's liability on acceptances executed and outstanding......... 1,380 Subordinated notes and debentures ............................... 5,708 Other liabilities ............................................... 11,295 TOTAL LIABILITIES ............................................... 281,638 ------- EQUITY CAPITAL Perpetual preferred stock and related surplus.................... 0 Common stock .................................................... 1,211 Surplus (exclude all surplus related to preferred stock)........ 10,291 Undivided profits and capital reserves .......................... 5,579 Net unrealized holding gains (losses) on available-for-sale securities ................................ (1) Cumulative foreign currency translation adjustments ............. 16 TOTAL EQUITY CAPITAL ............................................ 17,096 -------- TOTAL LIABILITIES AND EQUITY CAPITAL ............................ $298,734 ========
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby declare that this Report of Condition has been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and is true to the best of my knowledge and belief. JOSEPH L. SCLAFANI We, the undersigned directors, attest to the correctness of this Report of Condition and declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and is true and correct. WALTER V. SHIPLEY ) THOMAS G. LABRECQUE ) DIRECTORS WILLIAM B. HARRISON, JR.) -5- EX-25.2 8 FORM T-1, STATEMENT OF ELIGIBILITY OF TRUSTEE 1 ------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 ------------------------- FORM T-1 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE ------------------------------------------- CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________ ---------------------------------------- THE CHASE MANHATTAN BANK (Exact name of trustee as specified in its charter) NEW YORK 13-4994650 (State of incorporation (I.R.S. employer if not a national bank) identification No.) 270 PARK AVENUE NEW YORK, NEW YORK 10017 (Address of principal executive offices) (Zip Code) William H. McDavid General Counsel 270 Park Avenue New York, New York 10017 Tel: (212) 270-2611 (Name, address and telephone number of agent for service) -------------------------------------------- ASSOCIATES FIRST CAPITAL CORPORATION (Exact name of obligor as specified in its charter) DELAWARE 06-0876639 (State or other jurisdiction of (I.R.S. employer incorporation or organization) identification No.) 250 EAST CARPENTER FREEWAY IRVING, TEXAS 75062-2729 (Address of principal executive offices) (Zip Code) -------------------------------------------- SUBORDINATED DEBT SECURITIES (Title of the indenture securities) -------------------------------------------------------- 2 GENERAL Item 1. General Information. Furnish the following information as to the trustee: (a) Name and address of each examining or supervising authority to which it is subject. New York State Banking Department, State House, Albany, New York 12110. Board of Governors of the Federal Reserve System, Washington, D.C., 20551 Federal Reserve Bank of New York, District No. 2, 33 Liberty Street, New York, N.Y. Federal Deposit Insurance Corporation, Washington, D.C., 20429. (b) Whether it is authorized to exercise corporate trust powers. Yes. Item 2. Affiliations with the Obligor. If the obligor is an affiliate of the trustee, describe each such affiliation. None. - 2 - 3 Item 16. List of Exhibits List below all exhibits filed as a part of this Statement of Eligibility. 1. A copy of the Articles of Association of the Trustee as now in effect, including the Organization Certificate and the Certificates of Amendment dated February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982, February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1 filed in connection with Registration Statement No. 333-06249, which is incorporated by reference). 2. A copy of the Certificate of Authority of the Trustee to Commence Business (see Exhibit 2 to Form T-1 filed in connection with Registration Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in connection with the merger of Chemical Bank and The Chase Manhattan Bank (National Association), Chemical Bank, the surviving corporation, was renamed The Chase Manhattan Bank). 3. None, authorization to exercise corporate trust powers being contained in the documents identified above as Exhibits 1 and 2. 4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1 filed in connection with Registration Statement No. 333-06249, which is incorporated by reference). 5. Not applicable. 6. The consent of the Trustee required by Section 321(b) of the Act (see Exhibit 6 to Form T-1 filed in connection with Registration Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in connection with the merger of Chemical Bank and The Chase Manhattan Bank (National Association), Chemical Bank, the surviving corporation, was renamed The Chase Manhattan Bank). 7. A copy of the latest report of condition of the Trustee, published pursuant to law or the requirements of its supervising or examining authority. 8. Not applicable. 9. Not applicable. SIGNATURE Pursuant to the requirements of the Trust Indenture Act of 1939 the Trustee, The Chase Manhattan Bank, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of New York and State of New York, on the 2ND day of JUNE, 1998. THE CHASE MANHATTAN BANK By /s/ ANDREW M. DECK ----------------------------- ANDREW M. DECK VICE PRESIDENT - 3 - 4 Exhibit 7 to Form T-1 Bank Call Notice RESERVE DISTRICT NO. 2 CONSOLIDATED REPORT OF CONDITION OF The Chase Manhattan Bank of 270 Park Avenue, New York, New York 10017 and Foreign and Domestic Subsidiaries, a member of the Federal Reserve System, at the close of business March 31, 1998, in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.
DOLLAR AMOUNTS ASSETS IN MILLIONS Cash and balances due from depository institutions: Noninterest-bearing balances and currency and coin............................................. $ 12,037 Interest-bearing balances .................................... 4,054 Securities: ...................................................... Held to maturity securities........................................ 2,340 Available for sale securities...................................... 50,134 Federal funds sold and securities purchased under agreements to resell ......................................... 24,982 Loans and lease financing receivables: Loans and leases, net of unearned income..... $127,958 Less: Allowance for loan and lease losses.... 2,797 Less: Allocated transfer risk reserve ....... 0 -------- Loans and leases, net of unearned income, allowance, and reserve ....................................... 125,161 Trading Assets .................................................... 61,820 Premises and fixed assets (including capitalized leases)....................................................... 2,961 Other real estate owned ........................................... 347 Investments in unconsolidated subsidiaries and associated companies.......................................... 242 Customers' liability to this bank on acceptances outstanding .................................................. 1,380 Intangible assets ................................................. 1,549 Other assets ...................................................... 11,727 -------- TOTAL ASSETS ...................................................... $298,734 ========
- 4 - 5
LIABILITIES Deposits In domestic offices ........................................ $96,682 Noninterest-bearing .................. $38,074 Interest-bearing ..................... 58,608 ------- In foreign offices, Edge and Agreement, subsidiaries and IBF's ..................................... 72,630 Noninterest-bearing .................. $ 3,289 Interest-bearing ..................... 69,341 Federal funds purchased and securities sold under agreements to repurchase ........................................ 42,735 Demand notes issued to the U.S. Treasury ........................ 872 Trading liabilities ............................................. 45,545 Otherborrowed money (includes mortgage indebtedness and obligations under capitalized leases): With a remaining maturity of one year or less .............. 4,454 With a remaining maturity of more than one year through three years.................................... 231 With a remaining maturity of more than three years.......... 106 Bank's liability on acceptances executed and outstanding......... 1,380 Subordinated notes and debentures ............................... 5,708 Other liabilities ............................................... 11,295 TOTAL LIABILITIES ............................................... 281,638 ------- EQUITY CAPITAL Perpetual preferred stock and related surplus.................... 0 Common stock .................................................... 1,211 Surplus (exclude all surplus related to preferred stock)........ 10,291 Undivided profits and capital reserves .......................... 5,579 Net unrealized holding gains (losses) on available-for-sale securities ................................ (1) Cumulative foreign currency translation adjustments ............. 16 TOTAL EQUITY CAPITAL ............................................ 17,096 -------- TOTAL LIABILITIES AND EQUITY CAPITAL ............................ $298,734 ========
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby declare that this Report of Condition has been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and is true to the best of my knowledge and belief. JOSEPH L. SCLAFANI We, the undersigned directors, attest to the correctness of this Report of Condition and declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and is true and correct. WALTER V. SHIPLEY ) THOMAS G. LABRECQUE ) DIRECTORS WILLIAM B. HARRISON, JR.) -5- -----END PRIVACY-ENHANCED MESSAGE-----