T-3/A
1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
AMENDMENT NO. 1
TO
FORM T-3
FOR APPLICATIONS FOR QUALIFICATION OF INDENTURES UNDER THE
TRUST INDENTURE ACT OF 1939
Advanced Medical, Inc.
(Name of Applicant)
9775 Businesspark Avenue, San Diego, California 92131
(Address of principal executive offices)
SECURITIES TO BE ISSUED UNDER THE INDENTURE TO BE QUALIFIED
TITLE OF CLASS AMOUNT
15 percent Subordinated Debentures Due 1999 $14,122,500
Approximate date of proposed public offering: As soon as
practicable following the qualification of the indenture
covered hereby under the Trust Indenture Act of 1939, as
amended.
Name and address of agent for service: Daniel A. Etna,
Esq., Gordon Altman Butowsky Weitzen Shalov & Wein, 114 West
47th Street, New York, New York 10036
The obligor hereby amends this application for
qualification on such date or dates as may be necessary to
delay its effectiveness until (i) the 20th day after the
filing of a further amendment which specifically states that
it shall supersede this amendment, or (ii) such date as the
Commission, acting pursuant to Section 307(c) of the Act,
may determine upon the written request of the obligor.
GENERAL
1. General Information.
(a) Form of organization. A corporation
(b) State or other sovereign power under the laws of
which organized. Delaware
2. Securities Act exemption applicable.
Advanced Medical, Inc., a Delaware corporation
(the "Applicant"), is relying upon the exemption provided by
Section 3(a)(9) of the Securities Act of 1933, as amended
(the "Securities Act"), in claiming that registration of the
Debentures (as hereinafter defined) to be issued by the
Applicant in connection with the exchange transaction
hereinafter described (the "Exchange Transaction") is not
required under the Securities Act.
The Exchange Transaction will be accomplished
pursuant to the terms and provisions of a certain agreement
dated as of February 3, 1995 by and among the Applicant,
Fidelity Convertible Securities Fund ("Fidelity
Convertible") and Fidelity Select Healthcare Fund ("Fidelity
Healthcare"). Under such agreement, Fidelity Convertible
and Fidelity Healthcare will convert $24,315,599.74 of their
aggregate holdings of $28,245,000 principal amount of the
Applicant's 7.25 percent Convertible Subordinated Debentures Due
January 15, 2002 (the "7.25 percent Debentures") into 1,340,441
shares of the Applicant's common stock, par value $.01 per
share ("Common Stock"). In consideration for effecting such
conversion and surrendering the remaining $3,929,400.26
aggregate principal amount of the 7.25 percent Debentures held by
them to the Applicant for cancellation, Fidelity Convertible
and Fidelity Healthcare will receive in the aggregate from
the Applicant $14,122,500 principal amount of the
Applicant's 15 percent Subordinated Debentures Due July 15, 1999
(the "Debentures"). Consummation of the Exchange
Transaction is conditioned upon, among other things, the
qualification of the indenture (the "Indenture") for the
Debentures, a copy of which is filed as an exhibit to this
Form T-3, under the Trust Indenture Act of 1939, as amended
(the "Trust Indenture Act").
No sales of the 7.25 percent Debentures will be made by the
Applicant or by or through an underwriter at or about the
same time that the Exchange Transaction is consummated. No
sales of the Debentures or Common Stock will be made by the
Applicant (other than those sales included within the
Exchange Transaction) or by or through an underwriter at or
about the same time that the Exchange Transaction is
consummated.
Other than the payment of legal fees incurred in
connection therewith, the Exchange Transaction will be
effected without any consideration having been given,
directly or indirectly, to any person not a party thereto.
Neither Fidelity Convertible nor Fidelity
Healthcare will be required to make any cash payment in the
Exchange Transaction.
AFFILIATIONS
3. Affiliates.
The following persons may be deemed to be
affiliates of the Applicant:
Jeffry M. Picower
Decisions Incorporated
JA Special Partnership Limited
Monroe Systems for Business, Inc.
Physicians Computer Network, Inc.
Fidata Corporation
Fidata Trust Company New York
AM Development Limited
AM General Development Limited
IMED Nominee, Inc.
IMED Corporation
IMED Canada Ltd.
Medical Realizations Ltd.
IMED Ltd.
IMED Ireland
IMED Holding Co. Ltd.
IMED Pty. Ltd.
Mr. Picower, through Decisions Incorporated
("Decisions") and JA Special Partnership Limited (the
"Partnership"), and as a result of his positions with the
Applicant, may be deemed to control the Applicant. Mr.
Picower is the sole stockholder and sole director of
Decisions and the sole general partner of the Partnership.
See Items 4 and 5 of this Form T-3 for information
concerning the positions with the Applicant held by Mr.
Picower and the percentage of the Applicant's voting
securities which Mr. Picower may be deemed to beneficially
own.
Mr. Picower is the Chairman of the Board, a
director and the sole stockholder of Monroe Systems for
Business, Inc. ("Monroe"). Monroe is a worldwide office
equipment distribution and service organization.
Mr. Picower is the Chairman of the Board, a
director and the beneficial owner of approximately 54.84 percent of
the outstanding common stock of Physician Computer Network,
Inc. ("PCN"). PCN is a publicly-held company which develops
and markets practice management software products for
physician practices.
Each of Fidata Corporation, Fidata Trust Company
New York, AM Development Limited, AM General Development
Limited, IMED Nominee, Inc. and IMED Corporation ("IMED")
are wholly-owned subsidiaries of the Applicant. All of the
shares of capital stock (other than directors' qualifying
shares, if any) of each of IMED Canada Ltd., Medical
Realizations Ltd., IMED Ltd., IMED Ireland, IMED Holding Co.
Ltd. and IMED Pty. Ltd. are owned by IMED.
MANAGEMENT AND CONTROL
4. Directors and executive officers.
NAME ADDRESS OFFICE
Jeffry M. Picower South Ocean Blvd. Director, Chairman
Palm Beach, FL 33480 of the Board and
Chief Executive
Officer
Joseph W. Kuhn c/o Advanced Medical, Inc. Chief Financial
9775 Businesspark Avenue Officer, President,
San Diego, CA 92131 Treasurer and
Secretary
Anthony Cerami c/o Picower Institute Director
for Medical Research
350 Community Drive
Manhasset, NY 11030
Norman M. Dean c/o Advanced Medical, Inc. Director
9775 Businesspark Avenue
San Diego, CA 92131
Henry Green c/o Advanced Medical, Inc. Director
9775 Businesspark Avenue
San Diego, CA 92131
Richard B. Kelsky c/o Monroe Systems for Director
Business, Inc.
The American Road
Morris Plains, NJ 07950
5. Principal owners of voting securities.
As of March 13, 1995
PERCENTAGE
OF VOTING
NAME AND COMPLETE TITLE OF SECURITIES
MAILING ADDRESS CLASS OWNED AMOUNT OWNED OWNED
Jeffry M. Picower Common Stock 3,786,605 26.9 percent
South Ocean Blvd.
Palm Beach, FL
33480
The total for Mr. Picower includes (i) 1,379,600
shares of Common Stock owned by Decisions and (ii) 357,100
shares of Common Stock owned by the Partnership. See Item 3
of this Form T-3 for information concerning Mr. Picower's
affiliation with each of Decisions and the Partnership.
Based upon 14,069,261 shares of Common Stock
outstanding.
UNDERWRITERS
6. Underwriters. Not applicable.
CAPITAL SECURITIES
7. Capitalization.
(a) Authorized Classes of Securities.
As of March 13, 1995
TITLE OF CLASS AMOUNT AUTHORIZED AMOUNT OUTSTANDING
Common Stock, 75,000,000 14,069,261
$.01 par value
per share
10 Percent 1,800,000 329,928
Preferred Stock,
$.01 par value
per share
Convertible 333,000 333,000
Preferred Stock,
$.01 par value
per share
Preferred Stock, 6,000,000 0
$.001 par value
per share
7.25 Percent 60,000,000 600,000,000
Convertible
Subordinated
Debentures Due
2002
On July 29, 1991, Applicant issued a warrant to
purchase 25,000 shares of its Common Stock at an exercise
price of $10.625 per share (subject to certain anti-dilution
adjustments) to Montgomery Medical Ventures II, L.P. Such
warrant expires on December 31, 1997.
On January 4, 1994, the Applicant borrowed
$6,000,000 from Decisions, which amount is evidenced by a
promissory note (the "First Decisions Note"). The First
Decisions Note was payable on June 30, 1994 and has an
annual interest rate of 7 percent. The First Decisions Note is
convertible into 6,000,000 shares of Common Stock at a
conversion price of $1.00 per share (the "First Conversion
Price") (subject to certain anti-dilution adjustments
discussed below). On May 13, 1994, Decisions agreed to
amend the terms of the Decisions Note to provide, among
other things, that the principal amount thereof shall be
payable upon the earlier of January 4, 2001 or on demand by
Decisions provided the repayment is generated by net income
of the Applicant exclusive of IMED, any borrowing or debt or
equity offering by the Applicant, or funds available through
distributions from affiliates, including IMED.
On August 12, 1994, the Applicant borrowed
$6,500,000 from Decisions, which amount is evidenced by a
promissory note (the "Second Decisions Note"). The Second
Decisions Note is payable on January 4, 2001 and has an
annual interest rate of 9 percent. The Second Decisions Note is
convertible into 10,483,870 shares of Common Stock at a
conversion price of $0.62 per share (the "Second Conversion
Price") (subject to certain anti-dilution adjustments
discussed below). Any share of Common Stock received upon
conversion of the Second Decisions Note may not be sold into
the public market prior to August 12, 1996.
Each of the First Conversion Price and the Second
Conversion Price (each a "Conversion Price") is subject to
adjustment upon the occurrence of certain events, including
among others: (i) the issuance of additional shares of
Common Stock without consideration or for consideration per
share less than the greater of the then current market price
of the Common Stock or the Conversion Price in effect
immediately prior to such issuance (for which purpose
options or convertible securities issued by the Company
shall be deemed to be the issuance of additional shares of
Common Stock at the exercise or conversion price thereof);
(ii) the issuance of Common Stock as a dividend or
distribution on the Common Stock; (iii) the subdivision,
combination or reclassification of the Common Stock; (iv)
the issuance to holders of the Common Stock of options or
convertible securities having an exercise price or
conversion price less than the lesser of the then current
market price of the Common Stock or the Conversion Price in
effect immediately prior to such issuance. No adjustment to
the Conversion Price will be required unless such adjustment
would require an increase or decrease of at least 1/10 of 1 percent
of the Conversion Price, but any adjustment that would
otherwise be required to be made shall be carried forward
and taken into account in any subsequent adjustment. In the
case of any merger or consolidation of the Company, sale of
all or substantially all of the Company's assets or a
capital reorganization or reclassification of the Common
Stock, upon conversion, the noteholder shall be entitled to
receive, in lieu of Common Stock, the greatest amount of
securities, cash or other property to which such noteholder
would have actually have been entitled to receive as a
stockholder at the time of the consummation of such event.
(b) Voting Rights. The following description of each
class of voting securities of the Applicant is a summary of
certain provisions relating thereto and is qualified in its
entirety by the provisions of the Applicant's Certificate of
Incorporation, as amended (the "Certificate of
Incorporation"), and its By-Laws, as amended, copies of
which are filed as exhibits to this Form T-3.
Common Stock
The holders of Common Stock are entitled to one
vote for each share held of record on all matters submitted
to a vote of stockholders, except that stockholders may
cumulate their votes in the election of directors. In the
event of such cumulative voting, each stockholder has a
number of votes equal to the number of shares he owns times
the number of directorships to be filled and can distribute
them among candidates as he wishes. As a result, minority
stockholders who have more than a certain percentage of
shares may be able to elect one or more directors depending
on the number of directors to be elected at such a meeting.
Preferred Stock
Pursuant to the Certificate of Incorporation,
preferred stock may be issued from time to time in one or
more series, each of which shall be distinctively
designated, shall rank equally and shall be identical in all
respects. However, the board of directors (the "Board") of
the Applicant has the authority to issue, from time to time,
the preferred stock of any series and to state in the
resolution or resolutions providing for the issue of any
series, the voting powers, designations, preferences and
relative, participating, optional or other special rights,
and the qualifications, limitations or restrictions thereof.
The Board has authorized the issuance of a series
of 1,800,000 shares of 10 percent Preferred Stock and a series of
333,000 shares Convertible Preferred Stock. As of March 13,
1995, there were 329,928 shares of 10 percent Preferred Stock and
333,000 shares of Convertible Preferred Stock outstanding.
10 percent Preferred Stock.
Holders of shares of 10 percent Preferred Stock are
entitled to receive, when, as and if declared by the Board,
out of funds legally available therefor, cumulative
preferred dividends at an annual rate of $1.00 per share,
payable semi-annually. The Applicant did not declare and
pay the September 1993 and March 1994 dividends due on the
10 percent Preferred Stock and has not paid any dividends thereon
thereafter.
Under the Certificate of Incorporation, the
Applicant was required to redeem 25 percent of the originally
outstanding 10 percent Preferred Stock, subject to certain
limitations, including having legally available funds
therefor, on March 27 of each year from 1991 through 1994
(the next succeeding business day in case any such
anniversary should not be a business day) (each a
"Redemption Date"), at a price of $10.00 per share plus
accrued and unpaid dividends. The Applicant failed to
redeem on March 28, 1994 all of the then outstanding shares
of 10 percent Preferred Stock.
The failure of the Applicant to pay dividends on
the 10 percent Preferred Stock for two consecutive periods and to
redeem the 10 percent Preferred Stock on the 1994 Redemption Date
each constitute an event of default under the Certificate of
Incorporation. As a result, until such defaults are cured,
the holders of the 10 percent Preferred Stock, voting as a single
class on the basis of one vote per share, have the power to
elect two (2) directors to the Board by exercising certain
rights afforded to such holders in the Certificate of
Incorporation.
Without the consent of the holders of at least
two-thirds of the outstanding shares of 10 percent Preferred Stock,
the Applicant is not permitted to: (i) create any class or
series of preferred stock which shall have preference as to
dividends or distribution of assets over the 10 percent Preferred
Stock, provided, however, that the consent of the holders of
a majority of the outstanding shares of 10 percent Preferred Stock
is required for the issuance of a class of preferred stock
equal in preference as to dividends and distribution of
assets to the 10 percent Preferred Stock; or (ii) alter or change
the provisions of the Certificate of Incorporation so as to
adversely affect the voting power, preferences or special
rights of the holders of the 10 percent Preferred Stock.
Holders of the 10 percent Preferred Stock have no other
voting rights, except as otherwise required by Section 242
of the Delaware General Corporation Law.
Convertible Preferred Stock.
The Convertible Preferred Stock is convertible
into Common Stock at any time prior to redemption at a rate
of .617 shares of Common Stock for each share of Convertible
Preferred Stock (subject to anti-dilution adjustments). The
Convertible Preferred Stock is mandatorily redeemable on the
later of the date on which all of the issued and outstanding
shares of 10 percent Preferred Stock have been redeemed and March
28, 1998.
Without the consent of the holders of a majority
of the outstanding shares of Convertible Preferred Stock,
the Applicant is not permitted to: (i) create and/or issue
any shares of any class or series of preferred stock which
has a preference as to dividends, distributions, liquidation
and/or redemption, senior or on parity with the Convertible
Preferred Stock; (ii) enter into any agreement, document or
instrument, or any amendment or modification of any of the
foregoing, which will in any way limit, prevent or restrict
the Applicant's right and/or ability to pay dividends on or
redeem shares of the Convertible Preferred Stock, or limit,
prevent or restrict the Convertible Preferred Stock from
being converted into shares of Common Stock; (iii) alter or
change the provisions of the Certificate of Incorporation so
as to adversely affect the preferences or special rights of
the holders of the Convertible Preferred Stock; or (iv)
increase the par value of the Common Stock receivable upon
conversion of the Convertible Preferred Stock above the then
applicable conversion price.
Holders of the Convertible Preferred Stock have no
other voting rights, except as otherwise required by Section
242 of the Delaware General Corporation Law.
INDENTURE SECURITIES
8. Analysis of Indenture Provisions.
The Debentures are to be issued by the Applicant
under the Indenture promptly following its qualification
under the Trust Indenture Act. The trustee (the "Trustee")
under the Indenture is United States Trust Company of New
York. The following summaries of certain provisions of the
Indenture do not purport to be complete and are subject to,
and are qualified in their entirety by reference to, all of
the provisions of the Indenture, including the definitions
therein of certain terms. Wherever particular Sections or
defined terms of the Indenture are referred to, such
Sections or defined terms are incorporated herein by
reference.
General
The Debentures will be unsecured, subordinated
obligations of the Applicant, will mature on July 15, 1999
and will be limited to $14,122,500 aggregate principal
amount. The Debentures will bear interest at the rate of
15 percent per annum from the date of issue, or from the most
recent payment date to which interest has been paid or
provided for, payable semi-annually on January 15 and July
15, commencing July 15, 1995. Interest will be paid to the
persons in whose name the Debenture is registered at the
close of business on the January 1 and July 1 next preceding
the relevant interest payment date. Interest will be
computed on the basis of a 360-day year of twelve 30-day
months. The Applicant will not receive any cash proceeds
from the issuance of the Debentures pursuant to the
transaction described in Item 2 of this Form T-3.
Principal, premium, if any, and interest will be
payable, and the Debentures may be presented for redemption,
repurchase, exchange or transfer, at the office or agency of
the Applicant in the Borough of Manhattan, The City of New
York. In addition, payment of interest may, at the option
of the Applicant, be made by check mailed to the address of
the person entitled thereto as it appears in the register of
holders of the Debentures. (Sections 301 and 1002)
The Debentures are to be in registered form
without coupons in denominations of $500 and any whole
multiple thereof. A holder may transfer or exchange
Debentures in accordance with the Indenture. The Security
Registrar may require a holder, among other things, to
furnish appropriate endorsements and transfer documents and
to pay any taxes and fees required by law. The Applicant
need not transfer or exchange any Debentures (i) for a
period of 15 days before the mailing of a notice of
redemption or (ii) if such Debentures have been selected for
redemption. (Sections 302 and 305)
When issued, the Debentures will be a new issue of
securities with no established trading market therefor.
Subordination
The payment of principal of and premium, if any,
and interest on the Debentures will, to the extent set forth
in the Indenture, be subordinated and subject in right of
payment to the prior payment in full of all Senior
Indebtedness of the Applicant, whether outstanding at the
date of the Indenture or later incurred. (Article 13) In the
event of any default in the payment of the principal of, or
interest on, any Senior Indebtedness or any default
permitting the acceleration of Senior Indebtedness where
notice of such default has been given to the Applicant, no
payment with respect to the principal or interest on the
Debentures will be made by the Applicant unless and until
such default has been cured or waived. (Section 1304) In
addition, on each occasion that a Decisions Notice shall
have been delivered timely to the Applicant, no payment with
respect to the principal of the Debentures will be made by
the Applicant until the Decisions Amount has been paid by
the Applicant. (Section 1305)
Upon any payment or distribution of the
Applicant's assets to creditors upon any dissolution,
winding up, liquidation, reorganization, bankruptcy,
insolvency, receivership or other proceedings relating to
the Applicant or to its creditors, whether voluntary or
involuntary, the holders of all Senior Indebtedness will
first be entitled to receive payment in full of all amounts
due thereon before the holders of the Debentures will be
entitled to receive any payment upon the principal of or
premium, if any, or interest on the Debentures. (Section
1302)
The Applicant expects from time to time to incur
additional indebtedness, including, but not limited to,
Senior Indebtedness. The Indenture will not prohibit or
limit the incurrence of such additional indebtedness.
Optional Redemption
The Debentures may not be redeemed by the
Applicant prior to the first anniversary of their date of
issue, and will be redeemable on such date or thereafter, at
the Applicant's option, in whole or in part, upon not less
than 20 nor more than 60 days' notice, at the following
Redemption Prices expressed as percentages of principal
amount, plus accrued and unpaid interest to the redemption
date (and subject to the right of any record holder to
receive the interest payable on the applicable interest
payment date that is on or prior to the redemption date), if
redeemed during the 12-month period beginning on the
anniversary of the Debentures' date of issue in the years
indicated:
Redemption
Year Price
1996 110 percent
1997 105 percent
and at 100 percent of the principal amount, if redeemed on or after
the third anniversary of the Debentures' date of issue.
(Section 203)
Debentures in denominations larger than $500 may
be redeemed in part in whole multiples of $500. If fewer
than all the Debentures are redeemed, the Trustee will
select the particular Debentures to be redeemed by such
methods as the Trustee shall deem fair and appropriate and
as are in accordance with the rules and regulations of the
applicable self regulatory organizations. (Sections 1104 and
1108)
On and after the Redemption Date, unless the
Applicant defaults on the payment of the Redemption Price or
on interest accrued and unpaid to the Redemption Date,
interest will cease to accrue on Debentures called for
redemption and all rights of holders under the Debentures
will cease except the right to receive the applicable
Redemption Price. (Section 1107)
Repurchase at Option of Holders upon Occurrence of a Change
in Control
If prior to the Stated Maturity of the Debentures
there occurs any Change in Control with respect to the
Applicant, each holder of Debentures shall have the right,
at the holder's option, to require the Applicant to
repurchase all of such holder's Debentures, or a portion
thereof which is $500 in principal amount or any whole
multiple thereof, on the repurchase date that is 45 days
after the date of the notice by the Applicant of such Change
in Control, at a price of 100 percent of the principal amount, plus
accrued interest to the repurchase date (subject to the
right of holders on the relevant regular record date to
receive interest due on an interest payment date that is
prior to the repurchase date). (Section 1401)
Within 30 days after the occurrence of a Change in
Control, the Applicant is obligated to mail to all holders
of Debentures a notice of the occurrence of such Change in
Control and of the repurchase right arising as a result
thereof. The Applicant must deliver a copy of such notice
to the Trustee and cause a copy of such notice to be
published in a newspaper of general circulation in the
Borough of Manhattan, The City of New York. To exercise the
repurchase right, holders of Debentures must deliver on or
before the 30th day after the date of the notice of
repurchase an irrevocable written notice to the Trustee of
the holder's exercise of such right, together with the
Debentures with respect to which the right is being
exercised, duly endorsed for transfer. (Section 1402)
Events of Default, Notice and Waiver
The following will be Events of Default under the
Indenture: (a) failure to pay principal of or premium, if
any, on any Debenture when due, whether or not such payment
is prohibited by the subordination provisions of the
Indenture; (b) failure to pay any interest on any Debenture
when due, continued for 30 days (whether or not such payment
is prohibited by the subordination provision of the
Indenture); provided, however, that if the last day of such
30-day period is not a Business Day, then such period will
be extended until the next succeeding Business Day; (c) a
default in the payment of the Repurchase Price on any
Debenture when due; (d) a default in the payment of
indebtedness for borrowed money by the Applicant or any
Significant Subsidiary (as defined in the Indenture) which
results in the acceleration of the maturity of $1 million or
more of indebtedness, if such acceleration is not rescinded
or indebtedness discharged within 30 days after written
notice to the Applicant as provided in the Indenture; (e)
failure to perform any other covenant or agreement by the
Applicant in the Debentures or the Indenture continued for
60 days after written notice as provided in the Indenture;
and (f) certain events in bankruptcy, insolvency or
reorganization of the Applicant or any Significant
Subsidiary. (Section 501)
The Trustee will give the holders of the
Debentures notice of any default under the Indenture which
is known to a Responsible Officer of the Trustee as and to
the extent provided by the Trust Indenture Act.
Notwithstanding the foregoing, in the case of any default of
the character specified in clause (e) of the immediately
preceding paragraph, no notice of such default will be given
by the Trustee to the holders of the Debentures until at
least 30 days after the occurrence thereof. For purposes of
giving such notice, the term "default" means any event which
is, or after notice or lapse of time or both would become,
an Event of Default. (Section 602)
Subject to the provisions of the Indenture
relating to the duties of the Trustee in the case an Event
of Default shall occur and be continuing, the Trustee will
be under no obligation to exercise any of its rights or
powers under the Indenture at the request or direction of
any of the holders, unless such holders shall have offered
to the Trustee reasonable indemnity. (Section 603) The
holders of a majority in aggregate principal amount of the
outstanding Debentures will have the right to direct the
time, method and place of conducting any proceeding for any
remedy available to the Trustee or exercising any trust or
power conferred on the Trustee (subject to certain
exceptions). (Section 512)
If an Event of Default shall occur and be
continuing, either the Trustee or the holders of at least
25 percent in aggregate principal amount of the outstanding
Debentures may accelerate the maturity of all Debentures;
provided that after such acceleration, but before a judgment
or decree based on acceleration, the holders of a majority
in aggregate principal amount of outstanding Debentures may,
under certain circumstances, rescind and annul such
acceleration if all Events of Default, other than non-
payment of amounts which become due by acceleration, have
been cured or waived as provided in the Indenture. (Section
502)
No holder of any Debenture will have the right to
institute any proceeding with respect to the Indenture or
for any remedy thereunder unless such holder shall have
previously given to the Trustee written notice of a
continuing Event of Default and unless the holders of at
least 25 percent in aggregate principal amount of the outstanding
Debentures shall also have made written request, and offered
reasonable indemnity, to the Trustee to institute such
proceeding as trustee, and the Trustee shall not have
received from the holders of a majority in aggregate
principal amount of the outstanding Debentures a direction
inconsistent with such request and shall have failed to
institute such proceeding within 60 days. (Section 507)
However, such limitations do not apply to a suit instituted
by a holder of a Debenture for the enforcement of payment of
the principal of and premium, if any, or interest on such
Debenture on or after the respective due dates expressed in
such Debenture. (Section 508)
Upon request of the Trustee, the Applicant will be
required to furnish to the Trustee annually a statement as
to the performance by the Applicant of certain of its
obligations under the Indenture and as to any default in
such performance. (Section 704)
Prior to any declaration accelerating the maturity
of the Debentures, the holders of a majority in aggregate
principal amount of the outstanding Debentures may on behalf
of the holders of all Debentures waive certain past
defaults, not including a default in payment of the
principal of or premium, if any, or interest on any
Debenture or a default in respect of a covenant or provision
of the Indenture which cannot be modified or amended without
the consent of all holders of Debentures. (Section 513)
Modification
Supplemental indentures modifying or amending the
Indenture may be made by the Applicant and the Trustee with
the consent of the holders of a majority in aggregate
principal amount of the outstanding Debentures; provided
that no such modification or amendment may, without the
consent of the holder of each outstanding Debenture affected
thereby, (a) change the stated maturity of any Debenture,
(b) reduce the rate or extend the time of payment of
interest thereon, reduce the principal amount thereof or
premium, if any, thereon or reduce any amount payable on
redemption or repurchase thereof, (c) impair or affect the
right of a holder to institute suit for the payment thereof,
change the currency in which the Debentures are payable or
the place of payment, (d) adversely affect the right to have
the Debentures repurchased upon a Change in Control, (e)
modify the subordination provisions of the Debentures in a
manner adverse to the holders of the Debentures or (f)
reduce the aforesaid percentage of Debentures, the consent
of the holders of which is required for any such
modification or waiver of compliance with the Debentures
without the consent of the holders of all of the Debentures
then outstanding. (Section 902)
Satisfaction and Discharge
The Indenture will cease to be of further effect
(except as to surviving rights of registration of transfer
or exchange of the Debentures, as expressly provided for in
the Indenture) when (i) either (a) all Debentures
theretofore authenticated and delivered (except lost, stolen
or destroyed Debentures which have been replaced or paid and
Debentures for whose payment money has theretofore been
deposited in trust or segregated and held in trust by the
Applicant and thereafter repaid to the Applicant or
discharged from such trust) (as provided in Section 1003))
have been delivered to the Trustee for cancellation or (b)
all such Debentures not theretofore delivered to the Trustee
for cancellation have become due and payable or will become
due and payable at their Stated Maturity within one year or
will be called for redemption within one year and the
Applicant has irrevocably deposited or caused to be
deposited with the Trustee funds in an amount sufficient to
pay and discharge the entire indebtedness on the Debentures
not theretofore delivered to the Trustee for cancellation,
for principal of, premium, if any, and interest to the date
of deposit (in the case of Debentures which have become due
and payable) or to the Stated Maturity or Redemption Date,
as the case may be; (ii) the Applicant has paid all other
sums payable under the Indenture by the Applicant; and (iii)
the Applicant has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel each stating that all
conditions precedent under the Indenture relating to the
satisfaction and discharge of the Indenture have been
complied with.
9. Other obligors. Not applicable.
Contents of application for qualification. This
application for qualification comprises:
(a) Pages numbered 1 to 22, consecutively.
(b) The statement of eligibility and
qualification of each trustee under the indenture to be
qualified.
(c) The following exhibits in addition to those
filed as a part of the statement of eligibility and
qualification of each trustee.
Exhibit T3A-1 Certificate of Incorporation of the Applicant
and form of Certificate of Incorporation of
the Applicant, as amended. (Incorporated by
reference to Exhibit 3.1(a) to the
Prospectus/Joint Proxy Statement dated March
3, 1989 of Fidata Corporation, Advanced
Medical, Inc. and Controlled Therapeutics
Corporation included and forming part of the
Registration Statement on Form S-4 of
Advanced Medical, Inc. (the "Prospectus/Joint
Proxy Statement").
Exhibit T3A-2 Amendments to Articles First and Fourth of
the Restated Certificate of Incorporation of
the Applicant. (Incorporated by reference to
Exhibits A and B to Advanced Medical, Inc.'s
Proxy Statement dated August 15, 1990 for its
Special Meeting of Stockholders held on
September 7, 1990.
Exhibit T3A-3 Form of Certificate of Voting Powers,
Designation, Rights, Preferences and
Restrictions of 10 percent Cumulative Preferred
Stock. (Incorporated by reference to
Appendix A to Prospectus/Joint Proxy
Statement.)
Exhibit T3A-4 Form of Certificate of Voting Powers,
Designation, Rights, Preferences and
Restrictions of Convertible Preferred Stock.
(Incorporated by reference to Advanced
Medical, Inc.'s annual report on Form 10-K
for the year ended December 31, 1990.)
Exhibit T3A-5 Certificate of Amendment of Restated
Certificate of Incorporation of the Applicant
dated August 11, 1994. (Incorporated by
reference to Advanced Medical, Inc.'s Form T-
3 dated February 8, 1995.)
Exhibit T3B By-Laws of the Applicant, as amended.
(Incorporated by reference to Exhibit 3.1(b)
to the Prospectus/Joint Proxy Statement.)
Exhibit T3C Form of Indenture.
Exhibit T3D Not applicable.
Exhibit T3E Not applicable.
Exhibit T3F Included within Exhibit T3C.
Exhibit 99 Form T-1 of United States Trust Company of
New York dated February 6, 1995.
(Incorporated by reference to Advanced
Medical Inc.'s Form T-3 dated February 8,
1995.)
SIGNATURE
Pursuant to the requirements of the Trust
Indenture Act of 1939, the applicant, Advanced Medical,
Inc., a corporation organized and existing under the laws of
Delaware, has duly caused this application to be signed on
its behalf by the undersigned, thereunto duly authorized,
and its seal to be hereunto affixed and attested, all in the
City of San Diego, and State of California, on the 14th day
of March, 1995.
(SEAL)
ADVANCED MEDICAL, INC.
By: /s/ Joseph W. Kuhn
Joseph W. Kuhn
President
Attest: /s/ Jeffry M. Picower
Jeffry M. Picower
Chairman of the Board
EX-4
2
ADVANCED MEDICAL, INC.
TO
UNITED STATES TRUST COMPANY OF NEW YORK,
Trustee
___________________
Indenture
Dated as of __________, 1995
__________________
$14,122,500
15% Subordinated Debentures Due 1999
Certain Sections of this Indenture relating to
Sections 310 through 318(a) of the
Trust Indenture Act of 1939:
Trust Indenture Indenture
Act Section Section
Section 310(a)(1) ................... 609
(a)(2) ................... 609
(a)(3) ................... Not Applicable
(a)(4) ................... Not Applicable
(a)(5) ................... 609
(b) ................... 608
610
Section 311(a) ................... 613
(b) ................... 613
Section 312(a) ................... 701
702(a)
(b) ................... 702(b)
(c) ................... 702(c)
Section 313(a) ................... 703(a)
(b) ................... 703(a)
(c) ................... 703(a)
(d) ................... 703(b)
Section 314(a) ................... 704
(a)(4) ................... 101
1004
(b) ................... Not Applicable
(c)(1) ................... 102
(c)(2) ................... 102
(c)(3) ................... Not Applicable
(d) ................... Not Applicable
(e) ................... 102
Section 315(a) ................... 601
(b) ................... 602
(c) ................... 601
(d) ................... 601
(e) ................... 514
Section 316(a) ................... 101
512
(a)(1)(B) ................... 513
(a)(2) ................... Not Applicable
(b) ................... 508
(c) ................... 104(c)
Section 317(a)(1) ................... 503
(a)(2) ................... 504
(b) ................... 1003
Section 318(a) ................... 107
____________
Note: This reconciliation and tie shall not, for any purpose, be
deemed to be a part of the Indenture.
TABLE OF CONTENTS
Page
ARTICLE ONE
Definitions and Other Provisions
of General Application
SECTION 101. Definitions. . . . . . . . . . . . . . . . 1
SECTION 102. Compliance Certificates and Opinions . . . 8
SECTION 103. Form of Documents Delivered to Trustee . . 8
SECTION 104. Acts of Holders; Record Dates. . . . . . . 9
SECTION 105. Notices, Etc., to Trustee and Company. . . 10
SECTION 106. Notice to Holders; Waiver. . . . . . . . . 11
SECTION 107. Conflict with Trust Indenture Act. . . . . 11
SECTION 108. Effect of Headings and Table of
Contents . . . . . . . . . . . . . . . . . 11
SECTION 109. Successors and Assigns . . . . . . . . . . 12
SECTION 110. Separability Clause. . . . . . . . . . . . 12
SECTION 111. Benefits of Indenture. . . . . . . . . . . 12
SECTION 112. Governing Law. . . . . . . . . . . . . . . 12
SECTION 113. Legal Holidays . . . . . . . . . . . . . . 12
ARTICLE TWO
Security Forms
SECTION 201. Forms Generally. . . . . . . . . . . . . . 13
SECTION 202. Form of Face of Security . . . . . . . . . 13
SECTION 203. Form of Reverse of Security. . . . . . . . 15
SECTION 204. Form of Trustee's Certificate of
Authentication . . . . . . . . . . . . . . 17
ARTICLE THREE
The Securities
SECTION 301. Title and Terms. . . . . . . . . . . . . . 18
SECTION 302. Denominations. . . . . . . . . . . . . . . 19
SECTION 303. Execution, Authentication, Delivery and
Dating . . . . . . . . . . . . . . . . . . 19
SECTION 304. Temporary Securities . . . . . . . . . . . 19
SECTION 305. Registration, Registration of Transfer
and Exchange . . . . . . . . . . . . . . . 20
SECTION 306. Mutilated, Destroyed, Lost and Stolen
Securities . . . . . . . . . . . . . . . . 21
SECTION 307. Payment of Interest; Interest Rights
Preserved. . . . . . . . . . . . . . . . . 22
SECTION 308. Persons Deemed Owners. . . . . . . . . . . 23
SECTION 309. Cancellation . . . . . . . . . . . . . . . 24
SECTION 310. Computation of Interest. . . . . . . . . . 24
ARTICLE FOUR
Satisfaction and Discharge
SECTION 401. Satisfaction and Discharge of Indenture. . 24
SECTION 402. Application of Trust Money . . . . . . . . 26
ARTICLE FIVE
Remedies
SECTION 501. Events of Default. . . . . . . . . . . . . 26
SECTION 502. Acceleration of Maturity; Rescission and
Annulment. . . . . . . . . . . . . . . . . 28
SECTION 503. Collection of Indebtedness and Suits for
Enforcement by Trustee.. . . . . . . . . . 29
SECTION 504. Trustee May File Proofs of Claim . . . . . 30
SECTION 505. Trustee May Enforce Claims Without
Possession of Securities . . . . . . . . . 31
SECTION 506. Application of Money Collected . . . . . . 31
SECTION 507. Limitation on Suits. . . . . . . . . . . . 31
SECTION 508. Unconditional Right of Holders to Receive
Principal, Premium and Interest to
Redeem . . . . . . . . . . . . . . . . . . 32
SECTION 509. Restoration of Rights and Remedies . . . . 33
SECTION 510. Rights and Remedies Cumulative . . . . . . 33
SECTION 511. Delay or Omission Not Waiver . . . . . . . 33
SECTION 512. Control by Holders . . . . . . . . . . . . 33
SECTION 513. Waiver of Past Defaults. . . . . . . . . . 34
SECTION 514. Undertaking for Costs. . . . . . . . . . . 34
SECTION 515. Waiver of Stay or Extension Laws . . . . . 34
ARTICLE SIX
The Trustee
SECTION 601. Certain Duties and Responsibilities. . . . 35
SECTION 602. Notice of Defaults . . . . . . . . . . . . 35
SECTION 603. Certain Rights of Trustee. . . . . . . . . 35
SECTION 604. Not Responsible for Recitals or Issuance
of Securities. . . . . . . . . . . . . . . 37
SECTION 605. May Hold Securities. . . . . . . . . . . . 37
SECTION 606. Money Held in Trust. . . . . . . . . . . . 37
SECTION 607. Compensation and Reimbursement . . . . . . 37
SECTION 608. Disqualification; Conflicting Interests. . 38
SECTION 609. Corporate Trustee Required; Eligibility. . 39
SECTION 610. Resignation and Removal; Appointment of
Successor. . . . . . . . . . . . . . . . . 39
SECTION 611. Acceptance of Appointment by Successor . . 40
SECTION 612. Merger, Conversion, Consolidation or
Succession to Business . . . . . . . . . . 41
SECTION 613. Preferential Collection of Claims Against
Company. . . . . . . . . . . . . . . . . . 41
SECTION 614. Appointment of Authenticating Agent. . . . 41
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
SECTION 701. Company to Furnish Trustee Names and
Addresses of Holders . . . . . . . . . . . 43
SECTION 702. Preservation of Information;
Communications to Holders. . . . . . . . . 44
SECTION 703. Reports by Trustee . . . . . . . . . . . . 44
SECTION 704. Reports by Company . . . . . . . . . . . . 44
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease
SECTION 801. Company May Consolidate, Etc., Only on
Certain Terms. . . . . . . . . . . . . . . 45
SECTION 802. Successor Substituted. . . . . . . . . . . 46
ARTICLE NINE
Supplemental Indentures
SECTION 901. Supplemental Indentures Without Consent
of Holders . . . . . . . . . . . . . . . . 46
SECTION 902. Supplemental Indentures With Consent of
Holders. . . . . . . . . . . . . . . . . . 47
SECTION 903. Execution of Supplemental Indentures . . . 48
SECTION 904. Effect of Supplemental Indentures. . . . . 48
SECTION 905. Conformity with Trust Indenture Act. . . . 48
SECTION 906. Reference in Securities to Supplemental
Indentures . . . . . . . . . . . . . . . . 48
ARTICLE TEN
Covenants
SECTION 1001. Payment of Principal, Premium and
Interest . . . . . . . . . . . . . . . . . 49
SECTION 1002. Maintenance of Office or Agency. . . . . . 49
SECTION 1003. Money for Security Payments to Be Held in
Trust. . . . . . . . . . . . . . . . . . . 49
SECTION 1004. Statement by Officers as to Default. . . . 51
SECTION 1005. Existence. . . . . . . . . . . . . . . . . 51
SECTION 1006. Maintenance of Properties. . . . . . . . . 51
SECTION 1007. Payment of Taxes and Other Claims. . . . . 52
ARTICLE ELEVEN
Redemption of Securities
SECTION 1101. Right of Redemption. . . . . . . . . . . . 52
SECTION 1102. Applicability of Article . . . . . . . . . 52
SECTION 1103. Election to Redeem; Notice to Trustee. . . 52
SECTION 1104. Selection by Trustee of Securities to Be
Redeemed . . . . . . . . . . . . . . . . . 53
SECTION 1105. Notice of Redemption . . . . . . . . . . . 53
SECTION 1106. Deposit of Redemption Price. . . . . . . . 54
SECTION 1107. Securities Payable on Redemption Date. . . 54
SECTION 1108. Securities Redeemed in Part. . . . . . . . 55
ARTICLE TWELVE
[Intentionally left blank.]
ARTICLE THIRTEEN
Subordination of Securities
SECTION 1301. Securities Subordinate to Senior
Indebtedness . . . . . . . . . . . . . . . 55
SECTION 1302. Payment Over of Proceeds Upon
Dissolution, Etc.. . . . . . . . . . . . . 55
SECTION 1303. Prior Payment to Senior Indebtedness Upon
Acceleration of Securities . . . . . . . . 57
SECTION 1304. No Payment When Senior Indebtedness in
Default. . . . . . . . . . . . . . . . . . 57
SECTION 1305. Payment Permitted If No Default. . . . . . 58
SECTION 1306. Subrogation to Rights of Holders of
Senior Indebtedness. . . . . . . . . . . . 59
SECTION 1307. Provisions Solely to Define Relative
Rights . . . . . . . . . . . . . . . . . . 59
SECTION 1308. Trustee to Effectuate Subordination. . . . 60
SECTION 1309. No Waiver of Subordination Provisions. . . 60
SECTION 1310. Notice to Trustee. . . . . . . . . . . . . 61
SECTION 1311. Reliance on Judicial Order or Certificate
of Liquidating Agent.. . . . . . . . . . . 62
SECTION 1312. Trustee Not Fiduciary for Holders of
Senior Indebtedness. . . . . . . . . . . . 62
SECTION 1313. Rights of Trustee as Holder of Senior
Indebtedness; Preservation of Trustee's
Rights . . . . . . . . . . . . . . . . . . 62
SECTION 1314. Article Applicable to Paying Agents. . . . 63
SECTION 1315. Rights of Holders of Senior
Indebtedness . . . . . . . . . . . . . . . 63
SECTION 1316. Consent to Amendments of Subordination
Provisions . . . . . . . . . . . . . . . . 63
ARTICLE FOURTEEN
Right to Require Repurchase
SECTION 1401. Right to Require Repurchase. . . . . . . . 64
SECTION 1402. Notice; Method of Exercising Repurchase
Right. . . . . . . . . . . . . . . . . . . 64
SECTION 1403. Deposit of Repurchase Price. . . . . . . . 65
SECTION 1404. Securities Not Repurchased on
Repurchase . . . . . . . . . . . . . . . . 65
SECTION 1405. Securities Repurchased in Part . . . . . . 65
SECTION 1406. Certain Definitions. . . . . . . . . . . . 66
SECTION 1407. Adjustment of Reference Price. . . . . . . 67
SECTION 1408. Trustee's Disclaimer . . . . . . . . . . . 70
INDENTURE, dated as of __________, 1995, between Advanced
Medical, Inc., a corporation duly organized and existing under the
laws of the State of Delaware (herein called the "Company"), having
its principal office at 9775 Businesspark Avenue, San Diego,
California 92131, and United States Trust Company of New York, a
New York banking corporation, as Trustee (herein called the "Trust-
ee").
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an issue
of its 15% Subordinated Debentures Due 1999 (herein called the
"Securities") of substantially the tenor and amount hereinafter set
forth, and to provide therefor the Company has duly authorized the
execution and delivery of this Indenture.
All things necessary to make the Securities, when
executed by the Company and authenticated and delivered hereunder
and duly issued by the Company, the valid obligations of the
Company, and to make this Indenture a valid agreement of the
Company, in accordance with their and its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase
of the Securities by the Holders thereof, it is mutually agreed,
for the equal and proportionate benefit of all Holders of the
Securities, as follows:
ARTICLE ONE
Definitions and Other Provisions
of General Application
SECTION 101. Definitions.
For all purposes of this Indenture, except as otherwise
expressly provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as
well as the singular;
(2) all other terms used herein which are defined in the
Trust Indenture Act, either directly or by reference therein,
have the meanings assigned to them therein;
(3) all accounting terms not otherwise defined herein
have the meanings assigned to them in accordance with general-
ly accepted accounting principles, and, except as otherwise
herein expressly provided, the term "generally accepted
accounting principles" with respect to any computation
required or permitted hereunder shall mean such accounting
principles as are generally accepted at the date of such
computation; and
(4) the words "herein", "hereof " and "hereunder" and
other words of similar import refer to this Indenture as a
whole and not to any particular Article, Section or other
subdivision.
"Act", when used with respect to any Holder, has the
meaning specified in Section 104.
"Affiliate" of any specified Person means any other
Person directly or indirectly controlling or controlled by or under
direct or indirect common control with such specified Person. For
the purposes of this definition, "control" when used with respect
to any specified Person means the power to direct the management
and policies of such Person, directly or indirectly, whether
through the ownership of voting securities, by contract or
otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Authenticating Agent" means any Person authorized by the
Trustee pursuant to Section 614 to act on behalf of the Trustee to
authenticate Securities.
"Board of Directors" means either the board of directors
of the Company or any committee of that board duly authorized to
act for it hereunder.
"Board Resolution" means a copy of a resolution certified
by the Secretary or an Assistant Secretary of the Company to have
been duly adopted by the Board of Directors and to be in full force
and effect on the date of such certification, and delivered to the
Trustee.
"Business Day" means each Monday, Tuesday, Wednesday,
Thursday and Friday which is not a day on which banking institu-
tions in New York are authorized or obligated by law or executive
order to close.
"Change in Control" has the meaning ascribed to it in
Section 1406.
"Commission" means the Securities and Exchange Commis-
sion, as from time to time constituted, created under the Securi-
ties Exchange Act of 1934, as amended, or, if at any time after the
execution of this instrument such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties at such time.
"Common Stock" includes any stock of any class of the
Company which has no preference in respect of dividends or of
amounts payable in the event of any voluntary or involuntary
liquidation, dissolution or winding-up of the Company and which is
not subject to redemption by the Company.
"Company" means the Person named as the "Company" in the
first paragraph of this Indenture until a successor Person shall
have become such pursuant to the applicable provisions of this
Indenture, and thereafter "Company" shall mean such successor
Person.
"Company Request" or "Company Order" means a written
request or order signed in the name of the Company by its Chairman
of the Board, its Vice Chairman of the Board, its President or a
Vice President, and by its Treasurer, an Assistant Treasurer, its
Secretary or an Assistant Secretary, and delivered to the Trustee.
"Corporate Trust Office" means the office of the Trustee
at which at any particular time its corporate trust business shall
be principally administered, which office at the date of execution
of this Indenture is located at 114 West 47th Street, 15th Floor,
New York, New York 10036-1532, Attention: Corporate Trust
Department.
"Corporation" means a corporation, association, company,
joint-stock company or business trust.
"Decisions" shall mean Decisions Incorporated, a Delaware
corporation, and its successors and assigns.
"Defaulted Interest" has the meaning specified in Section
307.
"Event of Default" has the meaning specified in Section
501.
"Holder" means a Person in whose name a Security is
registered in the Security Register.
"Indenture" means this instrument as originally executed
or as it may from time to time be supplemented or amended by one or
more indentures supplemental hereto entered into pursuant to the
applicable provisions hereof, including, for all purposes of this
instrument and any such supplemental indenture, the provisions of
the Trust Indenture Act that are deemed to be a part of and govern
this instrument and any such supplemental indenture, respectively.
"Interest Payment Date" means the Stated Maturity of an
instalment of interest on the Securities.
"Maturity", when used with respect to any Security, means
the date on which the principal of such Security becomes due and
payable as therein or herein provided, whether at the Stated
Maturity or by declaration of acceleration, call for redemption or
otherwise.
"Officers' Certificate" means a certificate signed by the
Chairman of the Board, a Vice Chairman of the Board, the President
or a Vice President, and by the Treasurer, an Assistant Treasurer,
the Secretary or an Assistant Secretary, of the Company, and
delivered to the Trustee. One of the officers signing an Officers'
Certificate given pursuant to Section 1004 shall be the principal
executive, financial or accounting officer of the Company.
"Opinion of Counsel" means a written opinion of counsel,
who may be counsel for the Company, and who shall be reasonably
acceptable to the Trustee.
"Outstanding", when used with respect to Securities,
means, as of the date of determination, all Securities theretofore
authenticated and delivered under this Indenture, except:
(i) Securities theretofore cancelled by the Trustee
or delivered to the Trustee for cancellation;
(ii) Securities, or portions thereof, for whose
payment or redemption money in the necessary amount has been
theretofore deposited with the Trustee or any Paying Agent
(other than the Company) in trust or set aside and segregated
in trust by the Company (if the Company shall act as its own
Paying Agent) for the Holders of such Securities; provided
that, if such Securities are to be redeemed, notice of such
redemption has been duly given pursuant to this Indenture or
provision therefor satisfactory to the Trustee has been made;
and
(iii) Securities which have been paid pursuant to
Section 306 or in exchange for or in lieu of which other
Securities have been authenticated and delivered pursuant to
this Indenture, other than any such Securities in respect of
which there shall have been presented to the Trustee proof
satisfactory to it that such Securities are held by a bona
fide purchaser in whose hands such Securities are valid
obligations of the Company;
provided, however, that in determining whether the Holders of the
requisite principal amount of the Outstanding Securities 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 of
such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall
be protected in relying upon any such request, demand, authoriza-
tion, 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 satisfac-
tion of the Trustee the pledgee's right so to act with respect to
such Securities and that the pledgee is not the Company or any
other obligor upon the Securities or any Affiliate of the Company
or of such other obligor.
"Paying Agent" means any Person authorized by the Company
to pay the principal of (and premium, if any) or interest on any
Securities on behalf of the Company.
"Person" means any individual, corporation, limited
liability company, partnership, association, joint stock company,
joint venture, trust, unincorporated organization or government or
any agency or political subdivision thereof.
"Predecessor Security" of any particular Security means
every previous Security evidencing all or a portion of the same
debt as that evidenced by such particular Security; and, for the
purposes of this definition, any Security authenticated and
delivered under Section 306 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen
Security.
"Redemption Date", when used with respect to any Security
to be redeemed, means the date fixed for such redemption by or
pursuant to this Indenture and includes any Repurchase Date as
defined in Section 1401.
"Redemption Price", when used with respect to any
Security to be redeemed, means the price at which it is to be
redeemed pursuant to this Indenture.
"Reference Price" shall initially be equal to $18.14 per
share of Common Stock and is subject to adjustment as provided in
Section 1407.
"Regular Record Date" for the interest payable on any
Interest Payment Date means the January 1 or July 1 (whether or not
a Business Day), as the case may be, next preceding such Interest
Payment Date.
"Responsible Officer", when used with respect to the
Trustee, means the Chairman or any Vice-Chairman of the Board, the
Chairman or any Vice-Chairman of the Executive Committee of the
Board, the Chairman of the Trust Committee, the President or any
other officer or assistant officer assigned by the Trustee to
administer its corporate trust matters, or any person reporting
directly to any such person.
"Security Register" and "Security Registrar" have the
respective meanings specified in Section 305.
"Senior Indebtedness" means the principal of (and
premium, if any) and interest on (a) the (i) promissory note issued
by the Company to Decisions Incorporated, a Delaware corporation,
dated January 4, 1994 in the original principal amount of
$6,000,000 (as amended by a letter agreement dated May 13, 1994 and
further amended by a modification agreement dated February 3, 1995)
and (ii) promissory note issued by the Company to Decisions
Incorporated, a Delaware corporation, dated August 12, 1994 in the
original principal amount of $6,500,000 (as amended by the
aforesaid modification agreement dated February 3, 1995); (b) any
and all other indebtedness and obligations of the Company
(including indebtedness of others guaranteed by the Company) other
than the Securities, whether or not contingent and whether
outstanding on the date of this Indenture or thereafter created,
incurred or assumed, which (i) is for money borrowed or (ii) is
evidenced by any bond, note, debenture or similar instrument or
(iii) represents the unpaid balance on the purchase price of any
property, business, or asset of any kind, or (iv) is an obligation
of the Company as lessee under any and all leases of property,
equipment or other assets under generally accepted accounting
principles; and (c) deferrals, amendments, renewals, extensions,
modifications and refundings of any of the foregoing contemplated
in clauses (a) and (b) above, unless in any case in the instrument
creating or evidencing any such indebtedness or obligations or
pursuant to which the same is outstanding it is provided that such
indebtedness or obligation is not superior in right of payment to
the Securities. Notwithstanding the foregoing, the (i) 7-1/4%
Convertible Subordinated Debentures Due 2002 (the "Convertible
Debentures") of the Company issued pursuant to that certain
indenture dated as of January 15, 1992 between the Company and U.S.
Trust Company of California, N.A., as trustee, is not Senior
Indebtedness and (ii) Securities shall rank equally with and shall
not be superior in right of payment to the Convertible Debentures.
"Significant Subsidiary" means a Subsidiary which meets
any of the following conditions:
(1) The Company and its other Subsidiaries' proportion-
ate share of the total assets (after intercompany elimina-
tions) of the Subsidiary exceeds 10 percent of the total
assets of the Company and its Subsidiaries consolidated as of
the end of the most recently completed fiscal year.
(2) The Company and its other Subsidiaries' investments
in and advances to the Subsidiary exceed 10 percent of the
total assets of the Company and its Subsidiaries consolidated
as of the end of the most recently completed fiscal year.
"Special Record Date" for the payment of any Defaulted
Interest means a date fixed by the Trustee pursuant to Section 307.
"Stated Maturity", when used with respect to any Security
or any instalment of interest thereon, means the date specified in
such Security as the fixed date on which the principal of (and
premium, if any, on) such Security or such instalment of interest
is due and payable.
"Subsidiary" means a corporation more than 50% of the
outstanding voting stock of which is owned, directly or indirectly,
by the Company or by one or more other Subsidiaries, or by the
Company and one or more other Subsidiaries. For the purposes of
this definition, "voting stock" means stock which ordinarily has
voting power for the election of directors, whether at all times or
only so long as no senior class of stock has such voting power by
reason of any contingency.
"Trustee" means the Person named as the "Trustee" in the
first paragraph of this instrument until a successor Trustee shall
have become such pursuant to the applicable provisions of this
Indenture, and thereafter "Trustee" shall mean such successor
Trustee.
"Trust Indenture Act" means the Trust Indenture Act of
1939 as in force at the date as of which this instrument was
executed; provided, however, that in the event the Trust Indenture
Act of 1939 is amended after such date, "Trust Indenture Act"
means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Vice President", when used with respect to the Company
or the Trustee, means any vice president, whether or not designated
by a number or a word or words added before or after the title
"vice president".
SECTION 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the
Trustee to take any action under any provision of this Indenture,
the Company shall furnish to the Trustee such certificates and
opinions as may be required under this Indenture and under the
Trust Indenture Act. Each such certificate or opinion shall be
given in the form of an Officers' Certificate, if to be given by an
officer of the Company, or an Opinion of Counsel, if to be given by
counsel, and shall comply with the requirements of the Trust
Indenture Act and any other requirement set forth in this
Indenture.
Every certificate or opinion with respect to compliance
with a condition or covenant provided for in this Indenture shall
include
(1) a statement that each individual signing such
certificate or opinion has read such covenant or condition and
the definitions herein relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or
opinions contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such
individual, he has made such examination or investigation as
is necessary to enable him to express an informed opinion as
to whether or not such covenant or condition has been complied
with; and
(4) a statement as to whether, in the opinion of each
such individual, such condition or covenant has been complied
with.
SECTION 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be
certified by, or covered by an opinion of, any specified Person, it
is not necessary that all such matters be certified by, or covered
by the opinion of, only one such Person, or that they be so
certified or covered by only one document, but one such Person may
certify or give an opinion with respect to some matters and one or
more other such Persons as to other matters, and any such Person
may certify or give an opinion as to such matters in one or several
documents.
Any certificate or opinion of an officer of the Company
may be based, insofar as it relates to legal matters, upon a
certificate or opinion of, or representations by, counsel, unless
such officer knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with
respect to the matters upon which his certificate or opinion is
based are erroneous. Any such certificate or opinion of counsel may
be based, insofar as it relates to factual matters, upon a
certificate or opinion of, or representations by, an officer or
officers of the Company stating that the information with respect
to such factual matters is in the possession of the Company, unless
such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with
respect to such matters are erroneous.
Where any Person is required to make, give or execute two
or more applications, requests, consents, certificates, statements,
opinions or other instruments under this Indenture, they may, but
need not, be consolidated and form one instrument.
SECTION 104. Acts of Holders; Record Dates.
(a) Any request, demand, authorization, direction,
notice, consent, waiver or other action provided by this Indenture
to be given or taken by Holders may be embodied in and evidenced by
one or more instruments of substantially similar tenor signed by
such Holders in person or by agent duly appointed in writing; and,
except as herein otherwise expressly provided, such action shall
become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the
Company. Such instrument or instruments (and the action embodied
therein and evidenced thereby) are herein sometimes referred to as
the "Act" of the Holders signing such instrument or instruments.
Proof of execution of any such instrument or of a writing appoint-
ing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 601) conclusive in favor of the
Trustee and the Company, if made in the manner provided in this
Section.
(b) The fact and date of the execution by any Person of
any such instrument or writing may be proved by the affidavit of a
witness of such execution or by a certificate of a notary public or
other officer authorized by law to take acknowledgments of deeds,
certifying that the individual signing such instrument or writing
acknowledged to him the execution thereof. Where such execution is
by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute
sufficient proof of his authority. The fact and date of the
execution of any such instrument or writing, or the authority of
the Person executing the same, may also be proved in any other
manner which the Trustee deems sufficient.
(c) The Company may, in the circumstances permitted by
the Trust Indenture Act, fix any day as the record date for the
purpose of determining the Holders entitled to give or take any
request, demand, authorization, direction, notice, consent, waiver
or other action, or to vote on any action, authorized or permitted
to be given or taken by Holders. If not set by the Company prior
to the first solicitation of a Holder made by any Person in respect
of any such action, or, in the case of any such vote, prior to such
vote, the record date for any such action or vote shall be the 30th
day (or, if later, the date of the most recent list of Holders
required to be provided pursuant to Section 701) prior to such
first solicitation or vote, as the case may be. With regard to any
record date, only the Holders on such date (or their duly designat-
ed proxies) shall be entitled to give or take, or vote on, the
relevant action.
(d) The ownership of Securities shall be proved by the
Security Register.
(e) Any request, demand, authorization, direction,
notice, consent, waiver or other Act of the Holder of any Security
shall bind every future Holder of the same Security and the Holder
of every Security issued upon the registration of transfer thereof
or in exchange therefor or in lieu thereof in respect of anything
done, omitted or suffered to be done by the Trustee, any Paying
Agent or the Company in reliance thereon, whether or not notation
of such action is made upon such Security.
SECTION 105. Notices, Etc., to Trustee and Company.
Any request, demand, authorization, direction, notice,
consent, waiver or Act of Holders or other document provided or
permitted by this Indenture to be made upon, given or furnished to,
or filed with,
(1) the Trustee by any Holder or by the Company shall be
sufficient for every purpose hereunder if made, given,
furnished or filed in writing to or with the Trustee at its
Corporate Trust Office, Attention: Corporate Trust Division;
or
(2) the Company by the Trustee or by any Holder shall be
sufficient for every purpose hereunder (unless otherwise
herein expressly provided) if in writing and mailed, first-
class postage prepaid, to the Company addressed to it at the
address of its principal office specified in the first
paragraph of this instrument or at any other address previous-
ly furnished in writing to the Trustee by the Company.
SECTION 106. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of
any event, such notice shall be sufficiently given (unless
otherwise herein expressly provided) if in writing and mailed,
first-class postage prepaid, to each Holder affected by such event,
at his address as it appears in the Security Register, not later
than the latest date (if any), and not earlier than the earliest
date (if any), prescribed for the giving of such notice. In any
case where notice to Holders is given by mail, neither the failure
to mail such notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice with
respect to other Holders. Where this Indenture provides for notice
in any manner, such notice may be waived in writing by the Person
entitled to receive such notice, either before or after the event,
and such waiver shall be the equivalent of such notice. Waivers of
notice by Holders shall be filed with the Trustee, but such filing
shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.
In case by reason of the suspension of regular mail
service or by reason of any other cause it shall be impracticable
to give such notice by mail, then such notification as shall be
made with the approval of the Trustee shall constitute a sufficient
notification for every purpose hereunder.
SECTION 107. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts
with 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.
SECTION 108. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the
construction hereof.
SECTION 109. Successors and Assigns.
All covenants and agreements in this Indenture by the
Company shall bind its successors and assigns, whether so expressed
or not.
SECTION 110. Separability Clause.
In case any provision in this Indenture or in the
Securities shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions
shall not in any way be affected or impaired thereby.
SECTION 111. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express
or implied, shall give to any Person (other than the parties hereto
and their successors hereunder, any Paying Agent, the holders of
Senior Indebtedness and the Holders of Securities) any benefit or
any legal or equitable right, remedy or claim under this Indenture.
SECTION 112. Governing Law.
This Indenture and the Securities shall be governed by
and construed in accordance with the laws of the State of New York.
SECTION 113. Legal Holidays.
In any case where any Interest Payment Date, Redemption
Date or Stated Maturity of any Security shall not be a Business
Day, then (notwithstanding any other provision of this Indenture or
of the Securities) payment of interest or principal (and premium,
if any) need not be made on such date, but may be made on the next
succeeding Business Day with the same force and effect as if made
on the Interest Payment Date or Redemption Date, or at the Stated
Maturity, provided that no interest shall accrue for the period
from and after such Interest Payment Date, Redemption Date or
Stated Maturity, as the case may be.
ARTICLE TWO
Security Forms
SECTION 201. Forms Generally.
The Securities and the Trustee's certificates of
authentication shall be in substantially the forms set forth in
this Article, with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by
this Indenture, and may have such letters, numbers or other marks
of identification and such legends or endorsements placed thereon
as may be required to comply with the rules of any securities
exchange or as may, consistently herewith, be determined by the
officers executing such Securities, as evidenced by their execution
of the Securities.
The definitive Securities shall be printed, lithographed
or engraved or produced by any combination of these methods on
steel engraved borders or may be produced in any other manner
permitted by the rules of any securities exchange on which the
Securities may be listed, all as determined by the officers
executing such Securities, as evidenced by their execution of such
Securities.
SECTION 202. Form of Face of Security.
ADVANCED MEDICAL, INC.
CUSIP 00754C AB 7
15% Subordinated Debenture Due 1999
No. _________ $_______
Advanced Medical, Inc., a corporation duly organized and
existing under the laws of Delaware (herein called the "Company",
which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to
pay to _________________, or registered assigns, the principal sum
of _________________ DOLLARS on July 15, 1999, and to pay interest
thereon from ________, 1995 or from the most recent Interest
Payment Date to which interest has been paid or duly provided for,
semi-annually on January 15 and July 15 in each year, commencing
July 15, 1995 at the rate of 15% per annum, until the principal
hereof is paid or made available for payment. The interest so
payable, and punctually paid or duly provided for, on any Interest
Payment Date will, as provided in such Indenture, be paid to the
Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular
Record Date for such interest, which shall be the January 1 or July
1 (whether or not a Business Day), as the case may be, next
preceding such Interest Payment Date. Any such interest not so
punctually paid or duly provided for will forthwith cease to be
payable to the Holder on such Regular Record Date and may either be
paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on
a Special Record Date for the payment of such Defaulted Interest to
be fixed by the Trustee, notice whereof shall be given to Holders
of Securities not less than 10 days prior to such Special Record
Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on
which the Securities may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in said
Indenture. Payment of the principal of (and premium, if any) and
interest on this Security will be made at the office or agency of
the Company maintained for that purpose in the Borough of Manhat-
tan, The City of New York, in such coin or currency of the United
States of America as at the time of payment is legal tender for
payment of public and private debts; provided, however, that at the
option of the Company payment of interest may be made by check
mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register.
Reference is hereby made to the further provisions of
this Security set forth on the reverse hereof, which further
provisions shall for all purposes have the same effect as if set
forth at this place.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual
signature, this Security shall not be entitled to any benefit under
the Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this
instrument to be duly executed under its corporate seal.
Dated:
[Corporate seal] ADVANCED MEDICAL, INC.
By________________________
Attest:
SECTION 203. Form of Reverse of Security.
ADVANCED MEDICAL, INC.
15% Subordinated Debenture Due 1999
This Security is one of a duly authorized issue of
Securities of the Company designated as its 15% Subordinated
Debentures Due 1999 (herein called the "Securities"), limited in
aggregate principal amount to $14,122,500, issued and to be issued
under an Indenture, dated as of _________, 1995 (herein called the
"Indenture"), between the Company and United States Trust Company
of New York, as Trustee (herein called the "Trustee", which term
includes any successor trustee under the Indenture), to which
Indenture and all indentures supplemental thereto reference is
hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Company, the
Trustee, the holders of Senior Indebtedness and the Holders of the
Securities and of the terms upon which the Securities are, and are
to be, authenticated and delivered.
The Securities are subject to redemption upon not less
than 20 nor more than 60 days' notice by mail, on or after ______,
1996 as a whole or in part, at the election of the Company, at the
following Redemption Prices (expressed as percentages of the
principal amount): If redeemed during the twelve-month period
beginning _________ of the years indicated,
Redemption
Year Price
1996 110%
1997 105%
and at 100% if redeemed on or after, _________, 1998, at the
principal amount, together in the case of any such redemption with
accrued interest to the Redemption Date, but interest instalments
whose Stated Maturity is on or prior to such Redemption Date will
be payable to the Holders of such Securities, or one or more
Predecessor Securities, of record at the close of business on the
relevant Record Dates referred to on the face hereof, all as
provided in the Indenture.
In the event there shall occur any Change in Control (as
defined in the Indenture) each Holder of Securities shall have the
right, at the Holder's option but subject to the terms of the
Indenture, to require the Company to purchase on the Repurchase
Date all or any part of such Holder's Securities at a price equal
to 100% of the principal amount, together in the case of any such
repurchase with accrued interest to the Repurchase Date in the
manner specified in the Indenture.
In the event of redemption or repurchase of this Security
in part only, a new Security or Securities for the unredeemed
portion hereof will be issued in the name of the Holder hereof upon
the cancellation hereof.
The indebtedness evidenced by this Security is, to the
extent provided in the Indenture, subordinate and subject in right
of payment to the prior payment in full of all Senior Indebtedness,
and this Security is issued subject to the provisions of the
Indenture with respect thereto. Each Holder of this Security, by
accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his behalf to
take such action as may be necessary or appropriate to effectuate
the subordination so provided and (c) appoints the Trustee his
attorney-in-fact for any and all such purposes.
If an Event of Default shall occur and be continuing, the
principal of all the Securities may be declared due and payable in
the manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights
and obligations of the Company and the rights of the Holders of the
Securities under the Indenture at any time by the Company and the
Trustee with the consent of the Holders of a majority in aggregate
principal amount of the Securities at the time Outstanding. The
Indenture also contains provisions permitting the Holders of
specified percentages in aggregate principal amount of the
Securities at the time Outstanding, on behalf of the Holders of all
the Securities, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by
the Holder of this Security shall be conclusive and binding upon
such Holder and upon all future Holders of this Security and of any
Security issued upon the registration of transfer hereof or in
exchange herefor or in lieu hereof, whether or not notation of such
consent or waiver is made upon this Security.
No reference herein to the Indenture and no provision of
this Security or of the Indenture shall alter or impair the
obligation of the Company, which is absolute and unconditional, to
pay the principal of (and premium, if any) and interest on this
Security at the times, place and rate, and in the coin or currency,
herein prescribed.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is
registrable in the Security Register, upon surrender of this
Security for registration of transfer at the office or agency of
the Company in the Borough of Manhattan, The City of New York, duly
endorsed by, or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Security Registrar duly
executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Securities, of authorized
denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
The Securities are issuable only in registered form
without coupons in denominations of $500 and any integral multiple
thereof. As provided in the Indenture and subject to certain
limitations therein set forth, Securities are exchangeable for a
like aggregate principal amount of Securities of a different
authorized denomination, as requested by the Holder surrendering
the same.
No service charge shall be made for any such registration
of transfer, exchange or redemption, but the Company may require
payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.
Prior to due presentment of this Security for registra-
tion of transfer, the Company, the Trustee and any agent of the
Company or the Trustee may treat the Person in whose name this
Security is registered as the owner hereof for all purposes,
whether or not this Security be overdue, and neither the Company,
the Trustee nor any such agent shall be affected by notice to the
contrary.
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Inden-
ture.
SECTION 204. Form of Trustee's Certificate of Authentication.
The following form shall be included on the front side of
the Security:
This is one of the Securities referred to in the within-
mentioned Indenture.
United States Trust Company of New York,
as Trustee
By ________________________
Authorized Signatory
ARTICLE THREE
The Securities
SECTION 301. Title and Terms.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is limited to
$14,122,500, except for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of,
other Securities pursuant to Section 304, 305, 306, 906, 1108 or
1402.
The Securities shall be known and designated as the "15%
Subordinated Debentures Due 1999" of the Company. Their Stated
Maturity shall be July 15, 1999, and they shall bear interest at
the rate of 15% per annum, from _________, 1995 or from the most
recent Interest Payment Date to which interest has been paid or
duly provided for, as the case may be, payable semi-annually on
January 15 and July 15, commencing July 15, 1995 until the
principal thereof is paid or made available for payment.
The principal of (and premium, if any) and interest on
the Securities shall be payable at the office or agency of the
Company in the Borough of Manhattan, The City of New York
maintained for such purpose and at any other office or agency
maintained by the Company for such purpose; provided, however, that
at the option of the Company payment of interest may be made by
check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register.
The Securities shall be redeemable as provided in Article
Eleven.
The Securities shall be subordinated in right of payment
to Senior Indebtedness as provided in Article Thirteen.
The Securities shall be subject to repurchase by the
Company, at the option of the Holders, as provided in Article
Fourteen.
SECTION 302. Denominations.
The Securities shall be issuable only in registered form
without coupons and only in denominations of $500 and any integral
multiple thereof.
SECTION 303. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company
by its Chairman of the Board, its Vice Chairman of the Board, its
President or one of its Vice Presidents, under its corporate seal
reproduced thereon attested by its Secretary or one of its
Assistant Secretaries. The signature of any of these officers on
the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company
shall bind the Company, notwithstanding that such individuals or
any of them have ceased to hold such offices prior to the authenti-
cation and delivery of such Securities or did not hold such offices
at the date of such Securities.
At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities
executed by the Company to the Trustee for authentication, together
with a Company Order for the authentication and delivery of such
Securities; and the Trustee in accordance with such Company Order
shall authenticate and deliver such Securities as in this Indenture
provided and not otherwise.
Each Security shall be dated the date of its
authentication.
No Security shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there
appears on such Security a certificate of authentication substan-
tially in the form provided for herein executed by the Trustee by
manual signature, and such certificate upon any Security shall be
conclusive evidence, and the only evidence, that such Security has
been duly authenticated and delivered hereunder.
SECTION 304. Temporary Securities.
Pending the preparation of definitive Securities, the
Company may execute, and upon Company Order the Trustee shall
authenticate and deliver, temporary Securities which are printed,
lithographed, typewritten, mimeographed or otherwise produced, in
any authorized denomination, substantially of the tenor of the
definitive Securities in lieu of which they are issued and with
such appropriate insertions, omissions, substitutions and other
variations as the officers executing such Securities may determine,
as evidenced by their execution of such Securities.
If temporary Securities are issued, the Company will
cause definitive Securities to be prepared without unreasonable
delay. After the preparation of definitive Securities, the
temporary Securities shall be exchangeable for definitive
Securities upon surrender of the temporary Securities at any office
or agency of the Company designated pursuant to Section 1002,
without charge to the Holder. Upon surrender for cancellation of
any one or more temporary Securities the Company shall execute and
the Trustee shall authenticate and deliver in exchange therefor a
like principal amount of definitive Securities of authorized
denominations. Until so exchanged the temporary Securities shall
in all respects be entitled to the same benefits under this
Indenture as definitive Securities.
SECTION 305. Registration, Registration of Transfer and Ex-
change.
The Company shall cause to be kept at the Corporate Trust
Office of the Trustee a register (the register maintained in such
office and in any other office or agency designated pursuant to
Section 1002 being herein sometimes collectively referred to as the
"Security Register") in which, subject to such reasonable regula-
tions as it may prescribe, the Company shall provide for the
registration of Securities and of transfers of Securities. The
Trustee is hereby appointed "Security Registrar" for the purpose of
registering Securities and transfers of Securities as herein
provided.
Upon surrender for registration of transfer of any
Security at an office or agency of the Company designated pursuant
to Section 1002 for such purpose, the Company shall execute, and
the Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Securities of
any authorized denominations and of a like aggregate principal
amount.
At the option of the Holder, Securities may be exchanged
for other Securities of any authorized denominations and of a like
aggregate principal amount, upon surrender of the Securities to be
exchanged at such office or agency. Whenever any Securities are so
surrendered for exchange, the Company shall execute, and the
Trustee shall authenticate and deliver, the Securities which the
Holder making the exchange is entitled to receive.
All Securities issued upon any registration of transfer
or exchange of Securities shall be the valid obligations of the
Company, evidencing the same debt, and entitled to the same
benefits under this Indenture, as the Securities surrendered upon
such registration of transfer or exchange.
Every Security presented or surrendered for registration
of transfer, or for exchange or redemption shall (if so required by
the Company or the Trustee) be duly endorsed, or be accompanied by
a written instrument of transfer in form satisfactory to the
Company and the Security Registrar, duly executed by the Holder
thereof or his attorney duly authorized in writing.
No service charge shall be made to the Holder for any
registration of transfer or exchange or redemption of Securities,
but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of
Securities, other than exchanges pursuant to Section 304, 906, 1108
or 1402 not involving any transfer.
The Company shall not be required to (i) issue, register
the transfer of or exchange any Security during a period beginning
at the opening of business 15 days before the day of the mailing of
a notice of redemption of Securities selected for redemption under
Section 1104 and ending at the close of business on the day of such
mailing; (ii) register the transfer of or exchange any Security so
selected for redemption in whole or in part, except the unredeemed
portion of any Security being redeemed in part; or (iii) register
the transfer of or exchange any Security between a Record Date and
the next succeeding Interest Payment Date.
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee,
the Company shall execute and the Trustee shall authenticate and
deliver in exchange therefor a new Security of like tenor and
principal amount and bearing a number not contemporaneously
outstanding.
If there shall be delivered to the Company and the
Trustee (i) evidence to their satisfaction of the destruction, loss
or theft of any Security and (ii) such security or indemnity as may
be required by them to save each of them and any agent of either of
them harmless, then, in the absence of notice to the Company or the
Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and the Trustee shall
authenticate and deliver, in lieu of any such destroyed, lost or
stolen Security, a new Security of like tenor and principal amount
and bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen
Security has become or is about to become due and payable, the
Company in its discretion may, instead of issuing a new Security,
pay such Security.
Upon the issuance of any new Security under this Section,
the Company may require the payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in
relation thereto and any other expenses (including the fees and
expenses of the Trustee) connected therewith.
Every new Security issued pursuant to this Section in
lieu of any destroyed, lost or stolen Security shall constitute an
original additional contractual obligation of the Company, whether
or not the destroyed, lost or stolen Security shall be at any time
enforceable by anyone, and shall be entitled to all the benefits of
this Indenture equally and proportionately with any and all other
Securities duly issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with
respect to the replacement or payment of mutilated, destroyed, lost
or stolen Securities.
SECTION 307. Payment of Interest; Interest Rights Preserved.
Interest on any Security which is payable, and is
punctually paid or duly provided for, on any Interest Payment Date
shall be paid to the Person in whose name that Security (or one or
more Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest.
Any interest on any Security which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date
(herein called "Defaulted Interest") shall forthwith cease to be
payable to the Holder on the relevant Regular Record Date by virtue
of having been such Holder, and such Defaulted Interest may be paid
by the Company, at its election in each case, as provided in Clause
(1) or (2) below:
(1) The Company may elect to make payment of any
Defaulted Interest to the Persons in whose names the Securi-
ties (or their respective Predecessor Securities) are regis-
tered at the close of business on a Special Record Date for
the payment of such Defaulted Interest, which shall be fixed
in the following manner. The Company shall notify the Trustee
in writing of the amount of Defaulted Interest proposed to be
paid on each Security and the date of the proposed payment,
and at the same time the Company shall deposit with the
Trustee an amount of money equal to the aggregate amount
proposed to be paid in respect of such Defaulted Interest or
shall make arrangements satisfactory to the Trustee for such
deposit prior to the date of the proposed payment, such money
when deposited to be held in trust for the benefit of the
Persons entitled to such Defaulted Interest as in this Clause
provided. Thereupon the Trustee shall fix a Special Record
Date for the payment of such Defaulted Interest which shall be
not more than 15 days and not less than 10 days prior to the
date of the proposed payment and not less than 10 days after
the receipt by the Trustee of the notice of the proposed
payment. The Trustee shall promptly notify the Company of
such Special Record Date and, in the name and at the expense
of the Company, shall cause notice of the proposed payment of
such Defaulted Interest and the Special Record Date therefor
to be mailed, first-class postage prepaid, to each Holder at
his address as it appears in the Security Register, not less
than 10 days prior to such Special Record Date. Notice of the
proposed payment of such Defaulted Interest and the Special
Record Date therefor having been so mailed, such Defaulted
Interest shall be paid to the Persons in whose names the
Securities (or their respective Predecessor Securities) are
registered at the close of business on such Special Record
Date and shall no longer be payable pursuant to the following
Clause (2).
(2) The Company may make payment of any Defaulted
Interest in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Securi-
ties may be listed, and upon such notice as may be required by
such exchange, if, after notice given by the Company to the
Trustee of the proposed payment pursuant to this Clause, such
manner of payment shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section, each
Security delivered under this Indenture upon registration of
transfer of or in exchange for or in lieu of any other Security
shall carry the rights to interest accrued and unpaid, and to
accrue, which were carried by such other Security.
SECTION 308. Persons Deemed Owners.
Prior to due presentment of a Security for registration
of transfer, the Company, the Trustee and any agent of the Company
or the Trustee may treat the Person in whose name such Security is
registered as the owner of such Security for the purpose of
receiving payment of principal of (and premium, if any) and
(subject to Section 307) interest on such Security and for all
other purposes whatsoever, whether or not such Security be overdue,
and neither the Company, the Trustee nor any agent of the Company
or the Trustee shall be affected by notice to the contrary.
SECTION 309. Cancellation.
All Securities surrendered for payment, redemption,
registration of transfer or exchange shall, if surrendered to any
Person other than the Trustee, be delivered to the Trustee and
shall be promptly cancelled by it. The Company may at any time
deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which the Company may have
acquired in any manner whatsoever, and all Securities so delivered
shall be promptly cancelled by the Trustee. No Securities shall be
authenticated in lieu of or in exchange for any Securities
cancelled as provided in this Section, except as expressly
permitted by this Indenture. All cancelled Securities held by the
Trustee shall be disposed of as directed by a Company Order.
SECTION 310. Computation of Interest.
Interest on the Securities shall be computed on the basis
of a 360-day year of twelve 30-day months.
ARTICLE FOUR
Satisfaction and Discharge
SECTION 401. Satisfaction and Discharge of Indenture.
This Indenture shall cease to be of further effect
(except as to any surviving rights of registration of transfer or
exchange of Securities herein expressly provided for), and the
Trustee, on demand of and at the expense of the Company, shall
execute proper instruments acknowledging satisfaction and discharge
of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and
delivered (other than (i) Securities which have been
destroyed, lost or stolen and which have been replaced or
paid as provided in Section 306 and (ii) Securities for
whose payment money has theretofore been deposited in
trust or segregated and held in trust by the Company and
thereafter repaid to the Company or discharged from such
trust (as provided in Section 1003)), have been delivered
to the Trustee for cancellation; or
(B) all such Securities not theretofore delivered
to the Trustee for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated
Maturity within one year, or
(iii) are to be called for redemption within one year
under arrangements satisfactory to the Trustee for the
giving of notice of redemption by the Trustee in the
name, and at the expense, of the Company,
and the Company, in the case of (i), (ii) or (iii) above, has
deposited or caused to be deposited with the Trustee as trust
funds in trust for the purpose an amount sufficient to pay and
discharge the entire indebtedness on such Securities not
theretofore delivered to the Trustee for cancellation, for
principal (and premium, if any) and interest to the date of
such deposit (in the case of Securities which have become due
and payable) or to the Stated Maturity or Redemption Date, as
the case may be;
(2) the Company has paid or caused to be paid all other
sums payable hereunder by the Company; and
(3) the Company has delivered to the Trustee an Office-
rs' Certificate and an Opinion of Counsel, each stating that
all conditions precedent herein provided for relating to the
satisfaction and discharge of this Indenture have been
complied with.
Notwithstanding the satisfaction and discharge of this Indenture,
the obligations of the Company to the Trustee under section 607,
the obligations of the Trustee to any Authenticating Agent under
Section 614 and, if money shall have been deposited with the
Trustee pursuant to subclause (B) of Clause (1) of this Section,
the obligations of the Trustee under Section 402 and the last
paragraph of Section 1003 shall survive.
SECTION 402. Application of Trust Money.
Subject to the provisions of the last paragraph of
Section 1003, all money deposited with the Trustee pursuant to
Section 401 shall be held in trust and applied by it, in accordance
with the provisions of the Securities and this Indenture, to the
payment, either directly or through any Paying Agent (including the
Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and
premium, if any) and interest for whose payment such money has been
deposited with the Trustee.
ARTICLE FIVE
Remedies
SECTION 501. Events of Default.
"Event of Default", wherever used herein, means any one
of the following events (whatever the reason for such Event of
Default and whether it shall be occasioned by the provisions of
Article Thirteen or be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order of
any court or any order, rule or regulation of any administrative or
governmental body):
(1) default in the payment of any interest upon any
Security when it becomes due and payable, and continuance of
such default for a period of 30 days; provided, however, that
if the last day of such 30-day period is not a Business Day,
then such period shall be extended until the next succeeding
Business Day; or
(2) default in the payment of the principal of (or
premium, if any, on) any Security at its Maturity; or
(3) a default in the payment of the Repurchase Price (as
defined in Section 1401) in respect of any Security on the
Repurchase Date (as defined in Section 1401) therefor in
accordance with the provisions of Article Fourteen; or
(4) default in the performance, or breach, of any
covenant or warranty of the Company in this Indenture (other
than a covenant or warranty a default in whose performance or
whose breach is elsewhere in this Section specifically dealt
with), and continuance of such default or breach for a period
of 60 days after there has been given, by registered or
certified mail, to the Company by the Trustee or to the
Company and the Trustee by the Holders of at least 25% in
principal amount of the Outstanding Securities a written
notice specifying such default or breach and requiring it to
be remedied and stating that such notice is a "Notice of
Default" hereunder; or
(5) a default under any bond, debenture, note or other
evidence of indebtedness for money borrowed by the Company or
any of its Significant Subsidiaries or under any mortgage,
indenture or instrument under which there may be issued or by
which there may be secured or evidenced any indebtedness for
money borrowed by the Company or any Significant Subsidiary,
whether such indebtedness now exists or shall hereafter be
created, which default shall have resulted in the maturity of
$1,000,000 or more of such indebtedness becoming or being
declared due and payable prior to the date on which it would
otherwise have become due and payable, without such accelera-
tion having been rescinded or annulled or such indebtedness
having been discharged within a period of 30 days after there
shall have been given, by registered or certified mail, to the
Company by the Trustee or to the Company and the Trustee by
the Holders of at least 25% in principal amount of the
Outstanding Securities a written notice specifying such
default and requiring the Company to cause such acceleration
to be rescinded, annulled or discharged and stating that such
notice is a "Notice of Default" hereunder; provided, however,
that, subject to the provisions of Sections 601 and 602, the
Trustee shall not be deemed to have knowledge of such default
unless either (A) a Responsible Officer of the Trustee shall
have actual knowledge of such default or (B) the Trustee shall
have received written notice thereof from the Company, from
any Holder, from the holder of any such indebtedness or from
the trustee under any such mortgage, indenture or other
instrument; or
(6) the entry by a court having jurisdiction in the
premises of (A) a decree or order for relief in respect of the
Company or any Significant Subsidiary in an involuntary case
or proceeding under any applicable Federal or State bankrupt-
cy, insolvency, reorganization or other similar law or (B) a
decree or order adjudging the Company or any Significant
Subsidiary a bankrupt or insolvent, or approving as properly
filed a petition seeking reorganization, arrangement, adjust-
ment or composition of or in respect of the Company or any
Significant Subsidiary under any applicable Federal or State
law, or appointing a custodian, receiver, liquidator, assign-
ee, trustee, sequestrator or other similar official of the
Company or any Significant Subsidiary, as the case may be, or
of any substantial part of its property, or ordering the
winding up or liquidation of its affairs, and the continuance
of any such decree or order for relief or any such other
decree or order unstayed and in effect for a period of 60
consecutive days; or
(7) the commencement by the Company or any Significant
Subsidiary of a voluntary case or proceeding under any
applicable Federal or State bankruptcy, insolvency, reorgani-
zation or other similar law or of any other case or proceed-
ing, to be adjudicated a bankrupt or insolvent, or the consent
by it to the entry of a decree or order for relief in respect
of the Company or any Significant Subsidiary in an involuntary
case or proceeding under any applicable Federal or State
bankruptcy, insolvency, reorganization or other similar law or
to the commencement of any bankruptcy or insolvency case or
proceeding against the Company or any Significant Subsidiary,
or the filing by the Company or any Significant Subsidiary of
a petition or answer or consent seeking reorganization or
relief under any applicable Federal or State law, or the
consent by it to the filing of such petition or to the
appointment of or taking possession by a custodian, receiver,
liquidator, assignee, trustee, sequestrator or other similar
official of the Company or any Significant Subsidiary, as the
case may be, or of any substantial part of their property, or
the making by the Company or any Significant Subsidiary of an
assignment for the benefit of creditors, or the admission by
it in writing of its inability to pay its debts generally as
they become due, or the taking of corporate action by the
Company or any Subsidiary, as the case may be, in furtherance
of any such action.
SECTION 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default occurs and is continuing, then and
in every such case the Trustee or the Holders of not less than 25%
in principal amount of the Outstanding Securities may declare the
principal of all the Securities to be due and payable immediately,
by a notice in writing to the Company (and to the Trustee if given
by Holders), and upon any such declaration such principal shall
become immediately due and payable.
At any time after such a declaration of acceleration has
been made and before a judgment or decree for payment of the money
due has been obtained by the Trustee as hereinafter in this Article
provided, the Holders of a majority in principal amount of the
Outstanding Securities, by written notice to the Company and the
Trustee, may rescind and annul such declaration and its consequenc-
es if
(1) the Company has paid or deposited with the Trustee a sum
sufficient to pay
(A) all overdue interest on all Securities,
(B) the principal of (and premium, if any, on) any
Securities which have become due otherwise than by such
declaration of acceleration and interest thereon at the rate
borne by the Securities,
(C) to the extent that payment of such interest is
lawful, interest upon overdue interest at the rate borne by
the Securities, and
(D) all sums paid or advanced by the Trustee hereunder
and the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel;
and
(2) all Events of Default, other than the non-payment of the
principal of Securities which have become due solely by such
declaration of acceleration, have been cured or waived as
provided in Section 513.
No such rescission shall affect any subsequent default or impair
any right consequent thereon.
SECTION 503. Collection of Indebtedness and Suits for Enforce-
ment by Trustee.
The Company covenants that if
(1) default is made in the payment of any interest on
any Security when such interest becomes due and payable and
such default continues for a period of 30 days; provided,
however, that if the last day of such 30-day period is not a
Business Day, then such period shall be extended until the
next succeeding Business Day, or
(2) default is made in the payment of the principal of
(or premium, if any, on) any Security at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the
benefit of the Holders of such Securities, the whole amount then
due and payable on such Securities for principal (and premium, if
any) and interest, and, to the extent that payment of such interest
shall be legally enforceable, interest on any overdue principal
(and premium, if any) and on any overdue interest, at the rate
borne by the Securities, and, in addition thereto, such further
amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
If the Company fails to pay such amounts forthwith upon
such demand, the Trustee, in its own name and as trustee of an
express trust, may institute a judicial proceeding for the
collection of the sums so due and unpaid, and may prosecute such
proceeding to judgment or final decree, and may enforce the same
against the Company or any other obligor upon the Securities and
collect the moneys adjudged or decreed to be payable in the manner
provided by law out of the property of the Company or any other
obligor upon the Securities wherever situated.
If an Event of Default occurs and is continuing, the
Trustee may in its discretion proceed to protect and enforce its
rights and the rights of the Holders by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect and
enforce any such rights, whether for the specific enforcement of
any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other
proper remedy.
SECTION 504. Trustee May File Proofs of Claim.
In case of any judicial proceeding relative to the
Company (or any other obligor upon the Securities), its property or
its creditors, the Trustee (irrespective of whether the principal
of the Securities shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of
whether the Trustee shall have made any demand of the Company for
the payment of overdue principal, premium, if any, or interest)
shall be entitled and empowered, by intervention in such proceeding
or otherwise, to take any and all actions authorized under the
Trust Indenture Act in order to have claims of the Holders and the
Trustee allowed in any such proceeding. In particular, the Trustee
shall be authorized to collect and receive any moneys or other
property payable or deliverable on any such claims and to distrib-
ute the same; and any custodian, receiver, assignee, trustee,
liquidator, sequestrator or other similar official in any such
judicial proceeding is hereby authorized by each Holder to make
such payments to the Trustee and, in the event that the Trustee
shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel, and any other amounts due the Trustee under
Section 607.
No provision of this Indenture shall be deemed to
authorize the Trustee to authorize or consent to or accept or adopt
on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Securities or the rights of
any Holder thereof or to authorize the Trustee to vote in respect
of the claim of any Holder in any such proceeding.
SECTION 505. Trustee May Enforce Claims Without Possession of
Securities.
All rights of action and claims under this Indenture or
the Securities may be prosecuted and enforced by the Trustee
without the possession of any of the Securities or the production
thereof in any proceeding relating thereto, and any such proceeding
instituted by the Trustee shall be brought in its own name as
trustee of an express trust, and any recovery of judgment shall,
after provision for the payment of the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and
counsel, be for the ratable benefit of the Holders of the Securi-
ties in respect of which such judgment has been recovered.
SECTION 506. Application of Money Collected.
Subject to Article Thirteen, any money collected by the
Trustee pursuant to this Article shall be applied in the following
order, at the date or dates fixed by the Trustee and, in case of
the distribution of such money on account of principal (or premium,
if any) or interest, upon presentation of the Securities and the
notation thereon of the payment if only partially paid and upon
surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under
Section 607; and
SECOND: To the payment of the amounts then due and unpaid for
principal of (and premium, if any) and interest on the
Securities in respect of which or for the benefit of which
such money has been collected, ratably, without preference or
priority of any kind, according to the amounts due and payable
on such Securities for principal (and premium, if any) and
interest, respectively.
SECTION 507. Limitation on Suits.
No Holder of any Security shall have any right to
institute any proceeding, judicial or otherwise, with respect to
this Indenture, or for the appointment of a receiver or trustee, or
for any other remedy hereunder, unless
(1) such Holder has previously given written notice to
the Trustee of a continuing Event of Default;
(2) the Holders of not less than 25% in principal amount
of the Outstanding Securities shall have made written request
to the Trustee to institute proceedings in respect of such
Event of Default in its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabili-
ties to be incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of such
notice, request and offer of indemnity has failed to institute
any such proceeding; and
(5) no direction inconsistent with such written request
has been given to the Trustee during such 60-day period by the
Holders of a majority in principal amount of the Outstanding
Securities;
it being understood and intended that no one or more Holders shall
have any right in any manner whatever by virtue of, or by availing
of, any provision of this Indenture to affect, disturb or prejudice
the rights of any other Holders, or to obtain or to seek to obtain
priority or preference over any other Holders or to enforce any
right under this Indenture, except in the manner herein provided
and for the equal and ratable benefit of all the Holders.
SECTION 508. Unconditional Right of Holders to Receive Princi-
pal, Premium and Interest to Redeem.
Notwithstanding any other provision in this Indenture
other than Article Thirteen, the Holder of any Security shall have
the right, which is absolute and unconditional, to receive payment
of the principal of (and premium, if any) and (subject to Section
307) interest on such Security on the respective Stated Maturities
expressed in such Security (or, in the case of redemption, on the
Redemption Date), to redeem such Security in accordance with
Article Fourteen and to institute suit for the enforcement of any
such payment and right to redeem and such rights shall not be
impaired without the consent of such Holder.
SECTION 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceed-
ing to enforce any right or remedy under this Indenture and such
proceeding has been discontinued or abandoned for any reason, or
has been determined adversely to the Trustee or to such Holder,
then and in every such case, subject to any determination in such
proceeding, the Company, the Trustee and the Holders shall be
restored severally and respectively to their former positions
hereunder and thereafter all rights and remedies of the Trustee and
the Holders shall continue as though no such proceeding had been
instituted.
SECTION 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the
replacement or payment of mutilated, destroyed, lost or stolen
Securities in the last paragraph of Section 306, no right or remedy
herein conferred upon or reserved to the Trustee or to the Holders
is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or
otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion
or employment of any other appropriate right or remedy.
SECTION 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of
any Security to exercise any right or remedy accruing upon any
Event of Default shall impair any such right or remedy or consti-
tute a waiver of any such Event of Default or an acquiescence
therein. Every right and remedy given by this Article or by law to
the Trustee or to the Holders may be exercised from time to time,
and as often as may be deemed expedient, by the Trustee or by the
Holders, as the case may be.
SECTION 512. Control by Holders.
The Holders of a majority in principal amount of the
Outstanding Securities shall have the right to direct the time,
method and place of conducting any proceeding for any remedy
available to the Trustee or exercising any trust or power conferred
on the Trustee, provided that
(1) such direction shall not be in conflict with any
rule of law or with this Indenture, and
(2) the Trustee may take any other action deemed proper
by the Trustee which is not inconsistent with such direction.
SECTION 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal
amount of the Outstanding Securities may on behalf of the Holders
of all the Securities waive any past default hereunder and its
consequences, except a default
(1) in the payment of the principal of (or premium, if
any) or interest on any Security, or
(2) in respect of a covenant or provision hereof which
under Article Nine cannot be modified or amended without the
consent of the Holder of each Outstanding Security affected.
Upon any such waiver, such default shall cease to exist,
and any Event of Default arising therefrom shall be deemed to have
been cured, for every purpose of this Indenture; but no such waiver
shall extend to any subsequent or other default or impair any right
consequent thereon.
SECTION 514. Undertaking for Costs.
In any suit for the enforcement of any right or remedy
under this Indenture, or in any suit against the Trustee for any
action taken, suffered or omitted by it as Trustee, a court may
require any party litigant in such suit to file an undertaking to
pay the costs of such suit, and may assess costs against any such
party litigant, in the manner and to the extent provided in the
Trust Indenture Act; provided, that neither this Section nor the
Trust Indenture Act shall be deemed to authorize any court to
require such an undertaking or to make such an assessment in any
suit instituted by the Trustee or the Company.
SECTION 515. Waiver of Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully
do so) that it will not at any time insist upon, or plead, or in
any manner whatsoever claim or take the benefit or advantage of,
any stay or extension law wherever enacted, now or at any time
hereafter in force, which may affect the covenants or the perfor-
mance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of
any such law and covenants that it will not hinder, delay or impede
the execution of any power herein granted to the Trustee, but will
suffer and permit the execution of every such power as though no
such law had been enacted.
ARTICLE SIX
The Trustee
SECTION 601. Certain Duties and Responsibilities.
The duties and responsibilities of the Trustee shall be
as provided by the Trust Indenture Act. Notwithstanding the
foregoing, 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. Whether or not therein expressly so provided, every
provision of this Indenture relating to the conduct or affecting
the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section.
SECTION 602. Notice of Defaults.
The Trustee shall give the Holders notice of any default
hereunder known to a Responsible Officer of the Trustee as and to
the extent provided by the Trust Indenture Act; provided, however,
that in the case of any default of the character specified in
Section 501(4), no such notice to Holders shall be given until at
least 30 days after the occurrence thereof. For the purpose of
this Section, the term "default" means any event which is, or after
notice or lapse of time or both would become, an Event of Default.
SECTION 603. Certain Rights of Trustee.
Subject to the provisions of Section 601:
(a) the Trustee may rely and shall be protected in
acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebted-
ness or other paper or document believed by it to be genuine and to
have been signed or presented by the proper party or parties;
(b) any request or direction of the Company mentioned
herein shall be sufficiently evidenced by a Company Request or
Company Order and any resolution of the Board of Directors may be
sufficiently evidenced by a Board Resolution;
(c) whenever in the administration of this Indenture the
Trustee shall deem it desirable that a matter be proved or
established prior to taking, suffering or omitting any action
hereunder, the Trustee (unless other evidence be herein specifical-
ly prescribed) may, in the absence of bad faith on its part, rely
upon an Officers' Certificate;
(d) the Trustee may consult with counsel and the written
advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in
reliance thereon;
(e) the Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Indenture at the
request or direction of any of the Holders pursuant to this
Indenture, unless such Holders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such
request or direction;
(f) the Trustee shall not be bound to make any investi-
gation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document, but the
Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit, and, if
the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records
and premises of the Company, personally or by agent or attorney;
(g) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys and the Trustee shall not be responsi-
ble for any misconduct or negligence on the part of any agent or
attorney appointed with due care by it hereunder;
(h) the Trustee shall not be liable for any action taken
or omitted by it in good faith and believed by it to be authorized
or within the discretion, rights or powers conferred upon it by
this Indenture other than any liabilities arising out of the
negligence or willful misconduct of the Trustee; and
(i) 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.
SECTION 604. Not Responsible for Recitals or Issuance of Securi-
ties.
The recitals contained herein and in the Securities,
except the Trustee's certificates of authentication, shall be taken
as the statements of the Company, and the Trustee assumes no
responsibility for their correctness. The Trustee makes no
representations as to the validity or sufficiency of this Indenture
or of the Securities. The Trustee shall not be accountable for the
use or application by the Company of Securities or the proceeds
thereof.
SECTION 605. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent,
any Security Registrar or any other agent of the Company, in its
individual or any other capacity, may become the owner or pledgee
of Securities and, subject to Sections 608 and 613, may otherwise
deal with the Company with the same rights it would have if it were
not Trustee, Authenticating Agent, Paying Agent, Security Registrar
or such other agent.
SECTION 606. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law.
The Trustee shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed with the
Company.
SECTION 607. Compensation and Reimbursement.
The Company agrees
(1) to pay to the Trustee from time to time reasonable
compensation for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to
reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by the
Trustee in accordance with any provision of this Indenture
(including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such
expense, disbursement or advance as may be attributable to its
negligence or bad faith; and
(3) to indemnify the Trustee for, and to hold it
harmless against, any loss, liability or expense incurred
without negligence or bad faith on its part, arising out of or
in connection with the acceptance or administration of this
trust, including the costs and expenses of defending itself
against any claim or liability in connection with the exercise
or performance of any of its powers or duties hereunder.
As security for the performance of the obligations of the
Company under this Section the Trustee shall have a lien prior to
the Securities upon all property and funds held or collected by the
Trustee as such, except funds held in trust for the payment of
principal of (or premium, if any) or interest on the Securities.
The Trustee shall notify the Company promptly of any claim for
which it may seek indemnity. However, failure by the Trustee to so
promptly notify the Company shall not relieve the Company of its
obligations under this Section except to the extent such failure
shall have materially prejudiced the Company. The Company shall,
unless the Trustee requests separate counsel, defend any such claim
and the Trustee shall cooperate in the defense of such claim. If
the Trustee is advised by counsel that it may have available to it
defenses that are in conflict with any defenses available to the
Company, the Trustee may have separate counsel and the Company
shall pay the reasonable fees and expenses of such counsel. The
Company need not pay any settlement made without its consent, which
consent shall not be unreasonably withheld.
SECTION 608. Disqualification; Conflicting Interests.
If the Trustee has or shall acquire a conflicting
interest within the meaning of the Trust Indenture Act, the Trustee
shall, within 90 days after ascertaining that it has such
conflicting interest, either eliminate such interest or resign, to
the extent and in the manner provided by, and subject to the
provisions of, the Trust Indenture Act and this Indenture.
In the event that the Trustee shall fail to comply with
the foregoing provisions of this subsection, the Trustee shall,
within 10 days after the expiration of such 90-day period, transmit
notice of such failure to the Holders in the manner and to the
extent provided in the Trust Indenture Act.
SECTION 609. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which
shall be a Person that is eligible pursuant to the Trust Indenture
Act to act as such, has a combined capital and surplus of at least
$50,000,000 and has an office in the Borough of Manhattan, The City
of New York. If such Person publishes reports of condition at
least annually, pursuant to law or to the requirements of applica-
ble supervising or examining authority, then for the purposes of
this Section, the combined capital and surplus of such Person shall
be deemed to be its combined capital and surplus as set forth in
its most recent report of condition so published. If at any time
the Trustee shall cease to be eligible in accordance with the
provisions of this Section, it shall resign immediately in the
manner and with the effect hereinafter specified in this Article.
SECTION 610. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Trustee and no
appointment of a successor Trustee pursuant to this Article shall
become effective until the acceptance of appointment by the
successor Trustee under Section 611.
(b) The Trustee may resign at any time by giving written
notice thereof to the Company. If an instrument of acceptance by
a successor Trustee shall not have been delivered to the Trustee
within 30 days after the giving of such notice of resignation, the
resigning Trustee may petition any court of competent jurisdiction
for the appointment of a successor Trustee.
Holders of a majority in principal amount of the Outstanding
Securities, delivered to the Trustee and to the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 608
after written request therefor by the Company or by any Holder
who has been a bona fide Holder of a Security for at least six
months, or
(2) the Trustee shall cease to be eligible under Section
609 and shall fail to resign after written request therefor by
the Company or by any such Holder, or
(3) the Trustee shall become incapable of acting or
shall be adjudged a bankrupt or insolvent or a receiver of the
Trustee or of its property shall be appointed or any public
officer shall take charge or control of the Trustee or of its
property or affairs for the purpose of rehabilitation,
conservation or liquidation,
then, in any such case, (i) the Company by a Board Resolution may
remove the Trustee, or (ii) subject to Section 514, any Holder who
has been a bona fide Holder of a Security for at least six months
may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor Trustee.
(e) If the Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of
Trustee for any cause, the Company, by a Board Resolution, shall
promptly appoint a successor Trustee. If, within one year after
such resignation, removal or incapability, or the occurrence of
such vacancy, a successor Trustee shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding
Securities delivered to the Company and the retiring Trustee, the
successor Trustee so appointed shall, forthwith upon its acceptance
of such appointment, become the successor Trustee and supersede the
successor Trustee appointed by the Company. If no successor
Trustee shall have been so appointed by the Company or the Holders
and accepted appointment in the manner hereinafter provided, any
Holder who has been a bona fide Holder of a Security for at least
six months may, on behalf of himself and all others similarly
situated, petition any court of competent jurisdiction for the
appointment of a successor Trustee.
(f) The Company shall give notice of each resignation
and each removal of the Trustee and each appointment of a successor
Trustee to all Holders in the manner provided in Section 106. Each
notice shall include the name of the successor Trustee and the
address of its Corporate Trust Office.
SECTION 611. Acceptance of Appointment by Successor.
Every successor Trustee appointed hereunder shall
execute, acknowledge and deliver to the Company and to the retiring
Trustee an instrument accepting such appointment, and thereupon the
resignation or removal of the retiring Trustee shall become
effective and such successor Trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers,
trusts and duties of the retiring Trustee; but, on request of the
Company or the successor Trustee, such retiring Trustee shall, upon
payment of its charges, execute and deliver an instrument transfer-
ring to such successor Trustee all the rights, powers and trusts of
the retiring Trustee and shall duly assign, transfer and deliver to
such successor Trustee all property and money held by such retiring
Trustee hereunder. Upon request of any such successor Trustee, the
Company shall execute any and all instruments for more fully and
certainly vesting in and confirming to such successor Trustee all
such rights, powers and trusts.
No successor Trustee shall accept its appointment unless
at the time of such acceptance such successor Trustee shall be
qualified and eligible under this Article.
SECTION 612. Merger, Conversion, Consolidation or Succession to
Business.
Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any corporation succeeding to all or
substantially all the corporate trust business of the Trustee,
shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any
further act on the part of any of the parties hereto. In case any
Securities shall have been authenticated, but not delivered, by the
Trustee then in office, any successor by merger, conversion or
consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with the
same effect as if such successor Trustee had itself authenticated
such Securities.
SECTION 613. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of
the Company (or any other obligor upon the Securities), the Trustee
shall be subject to the provisions of the Trust Indenture Act
regarding the collection of claims against the Company (or any such
other obligor).
SECTION 614. Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents
which shall be authorized to act on behalf of the Trustee to
authenticate Securities issued upon original issue and upon
exchange, registration of transfer or partial redemption or
pursuant to Section 306, and Securities so authenticated shall be
entitled to the benefits of this Indenture and shall be valid and
obligatory for all purposes as if authenticated by the Trustee
hereunder. Wherever reference is made in this Indenture to the
authentication and delivery of Securities by the Trustee or the
Trustee's certificate of authentication, such reference shall be
deemed to include authentication and delivery on behalf of the
Trustee by an Authenticating Agent and a certificate of authentica-
tion executed on behalf of the Trustee by an Authenticating Agent.
Each Authenticating Agent shall be acceptable to the Company and
shall at all times be a corporation organized and doing business
under the laws of the United States of America, any State thereof
or the District of Columbia, authorized under such laws to act as
Authenticating Agent, having a combined capital and surplus of not
less than $50,000,000 and subject to supervision or examination by
Federal or State authority. If such Authenticating Agent publishes
reports of condition at least annually, pursuant to law or to the
requirements of said supervising or examining authority, then for
the purposes of this Section, the combined capital and surplus of
such Authenticating Agent shall be deemed to be its combined
capital and surplus as set forth in its most recent report of
condition so published. If at any time an Authenticating Agent
shall cease to be eligible in accordance with the provisions of
this Section, such Authenticating Agent shall resign immediately in
the manner and with the effect specified in this Section.
Any corporation into which an Authenticating Agent may be
merged or converted or with which it may be consolidated, or any
corporation resulting from any merger, conversion or consolidation
to which such Authenticating Agent shall be a party, or any
corporation succeeding to the corporate agency or corporate trust
business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise
eligible under this Section, without the execution or filing of any
paper or any further act on the part of the Trustee or the
Authenticating Agent.
An Authenticating Agent may resign at any time by giving
written notice thereof to the Trustee and to the Company. The
Trustee may at any time terminate the agency of an Authenticating
Agent by giving written notice thereof to such Authenticating Agent
and to the Company. Upon receiving such a notice of resignation or
upon such a termination, or in case at any time such Authenticating
Agent shall cease to be eligible in accordance with the provisions
of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall mail
written notice of such appointment by first-class mail, postage
prepaid, to all Holders as their names and addresses appear in the
Security Register. Any successor Authenticating Agent upon
acceptance of its appointment hereunder shall become vested with
all the rights, powers and duties of its predecessor hereunder,
with like effect as if originally named as an Authenticating Agent.
No successor Authenticating Agent shall be appointed unless
eligible under the provisions of this Section.
The Trustee agrees to pay to each Authenticating Agent
from time to time reasonable compensation for its services under
this Section, and the Trustee shall be entitled to be reimbursed
for such payments, subject to the provisions of Section 607.
If an appointment is made pursuant to this Section, the
Securities may have endorsed thereon, in addition to the Trustee's
certificate of authentication, an alternative certificate of
authentication in the following form:
This is one of the Securities described in the within-
mentioned Indenture.
____________________________,
As Trustee
By____________________________,
As Authenticating Agent
By____________________________,
Authorized Signatory
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
SECTION 701. Company to Furnish Trustee Names and Addresses of
Holders.
The Company will furnish or cause to be furnished to the
Trustee
(a) semi-annually, not more than 15 days after each
Regular Record Date, a list, in such form as the Trustee may
reasonably require, of the names and addresses of the Holders
as of such Regular Record Date, and
(b) at such other times as the Trustee may request in
writing, within 30 days after the receipt by the Company of
any such request, a list of similar form and content as of a
date not more than 15 days prior to the time such list is
furnished;
excluding from any such list names and addresses received by the
Trustee in its capacity as Security Registrar.
SECTION 702. Preservation of Information; Communications to
Holders.
(a) The Trustee shall preserve, in as current a form as
is reasonably practicable, the names and addresses of Holders
contained in the most recent list furnished to the Trustee as
provided in Section 701 and the names and addresses of Holders
received by the Trustee in its capacity as Security Registrar. The
Trustee may destroy any list furnished to it as provided in Section
701 upon receipt of a new list so furnished.
(b) The rights of Holders to communicate with other
Holders with respect to their rights under this Indenture or under
the Securities, and the corresponding rights and duties of the
Trustee, shall be as provided by the Trust Indenture Act.
(c) Every Holder of Securities, by receiving and holding
the same, agrees with the Company and the Trustee that neither the
Company nor the Trustee nor any agent of either of them shall be
held accountable by reason of any disclosure of information as to
names and addresses of Holders made pursuant to the Trust Indenture
Act.
SECTION 703. Reports by Trustee.
(a) The Trustee shall transmit to Holders such reports
concerning the Trustee and its actions under this Indenture as may
be required pursuant to the Trust Indenture Act at the times and in
the manner provided pursuant thereto.
(b) A copy of each such report shall, at the time of
such transmission to Holders, be filed by the Trustee with each
stock exchange upon which the Securities are listed, with the
Commission and with the Company. The Company will notify the
Trustee when the Securities are listed on any stock exchange.
SECTION 704. Reports by Company.
The Company shall file with the Trustee and the Commis-
sion, and transmit to Holders, such information, documents and
other reports, and such summaries thereof, as may be required
pursuant to the Trust Indenture Act at the times and in the manner
provided pursuant to such Act; provided that any such information,
documents or reports required to be filed with the Commission
pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934, as amended, shall be filed with the Trustee within 15 days
after the same is so required to be filed with the Commission.
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease
SECTION 801. Company May Consolidate, Etc., Only on Certain
Terms.
The Company shall not consolidate with or merge into any
other Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, and the Company shall
not permit any Person to consolidate with or merge into the Company
or convey, transfer or lease its properties and assets substantial-
ly as an entirety to the Company, unless:
(1) in case the Company shall consolidate with or merge
into another Person or convey, transfer or lease its proper-
ties and assets substantially as an entirety to any Person,
the Person formed by such consolidation or into which the
Company is merged or the Person which acquires by conveyance
or transfer, or which leases, the properties and assets of the
Company substantially as an entirety shall be a corporation,
partnership or trust, shall be organized and validly existing
under the laws of the United States of America, any State
thereof or the District of Columbia and shall expressly
assume, by an indenture supplemental hereto, executed and
delivered to the Trustee, in form satisfactory to the Trustee,
the due and punctual payment of the principal of (and premium,
if any) and interest on all the Securities and the performance
or observance of every covenant of this Indenture on the part
of the Company to be performed or observed;
(2) immediately after giving effect to such transaction
and treating any indebtedness which becomes an obligation of
the Company or a Subsidiary as a result of such transaction as
having been incurred by the Company or such Subsidiary at the
time of such transaction, no Event of Default, and no event
which, after notice or lapse of time or both, would become an
Event of Default, shall have happened and be continuing; and
(3) the Company has delivered to the Trustee an Office-
rs' Certificate and an Opinion of Counsel, each stating that
such consolidation, merger, conveyance, transfer or lease and,
if a supplemental indenture is required in connection with
such transaction, such supplemental indenture comply with this
Article and that all conditions precedent herein provided for
relating to such transaction have been complied with.
SECTION 802. Successor Substituted.
Upon any consolidation of the Company with, or merger of
the Company into, any other Person or any conveyance, transfer or
lease of the properties and assets of the Company substantially as
an entirety in accordance with Section 801, the successor Person
formed by such consolidation or into which the Company is merged or
to which such conveyance, transfer or lease is made shall succeed
to, and be substituted for, and may exercise every right and power
of, the Company under this Indenture with the same effect as if
such successor Person had been named as the Company herein, and
thereafter, except in the case of a lease, the predecessor Person
shall be relieved of all obligations and covenants under this
Indenture and the Securities.
ARTICLE NINE
Supplemental Indentures
SECTION 901. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company, when
authorized by a Board Resolution, and the Trustee, at any time and
from time to time, may enter into one or more indentures supplemen-
tal hereto, in form satisfactory to the Trustee, for any of the
following purposes:
(1) to evidence the succession of another Person to the
Company and the assumption by any such successor of the
covenants of the Company herein and in the Securities; or
(2) to add to the covenants of the Company for the
benefit of the Holders, or to surrender any right or power
herein conferred upon the Company; or
(3) to secure the Securities; or
(4) to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other
provision herein, or to make any other provisions with respect
to matters or questions arising under this Indenture, provided
that such action pursuant to this Clause (4) shall not
adversely affect the interests of the Holders.
SECTION 902. Supplemental Indentures With Consent of Holders.
With the consent of the Holders of not less than a
majority in principal amount of the Outstanding Securities, by Act
of said Holders delivered to the Company and the Trustee, the
Company, when authorized by a Board Resolution, and the Trustee may
enter into an indenture or indentures supplemental hereto for the
purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Indenture or of modifying
in any manner the rights of the Holders under this Indenture;
provided, however, that no such supplemental indenture shall,
without the consent of the Holder of each Outstanding Security
affected thereby,
(1) change the Stated Maturity of the principal of, or
any instalment of interest on, any Security, or reduce the
principal amount thereof or the rate of interest thereon or
any premium payable upon the redemption or repurchase thereof,
or change the place of payment where, or the coin or currency
in which, any Security or any premium or interest thereon is
payable, or impair the right to institute suit for the
enforcement of any such payment on or after the Stated
Maturity thereof (or, in the case of redemption, on or after
the Redemption Date), or adversely affect the right to redeem
any Security as provided in Article Fourteen, or modify the
provisions of this Indenture with respect to the subordination
of the Securities in a manner adverse to the Holders, or
(2) reduce the percentage in principal amount of the
Outstanding Securities, the consent of whose Holders is
required for any such supplemental indenture, or the consent
of whose Holders is required for any waiver (of compliance
with certain provisions of this Indenture or certain defaults
hereunder and their consequences) provided for in this
Indenture, or
(3) modify any of the provisions of this Section or
Section 513, except to increase any such percentage or to
provide that certain other provisions of this Indenture cannot
be modified or waived without the consent of the Holder of
each Outstanding Security affected thereby.
It shall not be necessary for any Act of Holders under
this Section to approve the particular form of any proposed
supplemental indenture, but it shall be sufficient if such Act
shall approve the substance thereof.
SECTION 903. Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created
by, any supplemental indenture permitted by this Article or the
modifications thereby of the trusts created by this Indenture, the
Trustee shall be entitled to receive, and (subject to Section 601)
shall be fully protected in relying upon, an Opinion of Counsel
stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Trustee may, but
shall not be obligated to, enter into any such supplemental
indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
SECTION 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under
this Article, this Indenture shall be modified in accordance
therewith, and such supplemental indenture shall form a part of
this Indenture for all purposes; and every Holder of Securities
theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
SECTION 905. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this
Article shall conform to the requirements of the Trust Indenture
Act.
SECTION 906. Reference in Securities to Supplemental Indentures.
Securities authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article
may, and shall if required by the Trustee, bear a notation in form
approved by the Trustee as to any matter provided for in such
supplemental indenture. If the Company shall so determine, new
Securities so modified as to conform, in the opinion of the Trustee
and the Company, to any such supplemental indenture may be prepared
and executed by the Company and authenticated and delivered by the
Trustee in exchange for Outstanding Securities.
ARTICLE TEN
Covenants
SECTION 1001. Payment of Principal, Premium and Interest.
The Company will duly and punctually pay the principal of
(and premium, if any) and interest on the Securities in accordance
with the terms of the Securities and this Indenture.
SECTION 1002. Maintenance of Office or Agency.
The Company will maintain in the Borough of Manhattan,
The City of New York, an office or agency where Securities may be
presented or surrendered for payment, where Securities may be
surrendered for registration of transfer or exchange, where
Securities may be surrendered for repurchase and where notices and
demands to or upon the Company in respect of the Securities and
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 such office or agency. If at any time the Company
shall fail to maintain any such required office or agency or shall
fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or
served at the Corporate Trust Office of the Trustee, and the
Company hereby appoints the Trustee as its agent to receive all
such presentations, surrenders, notices and demands.
The Company may also from time to time designate one or
more other offices or agencies (in or outside the Borough of
Manhattan, The City of New York) where the Securities may be
presented or surrendered for any or all such purposes and may from
time to time rescind such designations; provided, however, that no
such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in the
Borough of Manhattan, The City of New York, for such purposes. The
Company will give prompt written notice to the Trustee of any such
designation or rescission and of any change in the location of any
such other office or agency.
SECTION 1003. Money for Security Payments to Be Held in Trust.
If the Company shall at any time act as its own Paying
Agent, it will, on or before each due date of the principal of (and
premium, if any) or interest on any of the Securities, segregate
and hold in trust for the benefit of the Persons entitled thereto
a sum sufficient to pay the principal (and premium, if any) or
interest so becoming due until such sums shall be paid to such
Persons or otherwise disposed of as herein provided and will
promptly notify the Trustee in writing of its action or failure so
to act.
Whenever the Company shall have one or more Paying
Agents, it will, prior to each due date of the principal of (and
premium, if any) or interest on any Securities, deposit with a
Paying Agent a sum sufficient to pay such amount, such sum to be
held as provided by the Trust Indenture Act, and (unless such
Paying Agent is the Trustee) the Company will promptly notify the
Trustee of its action or failure so to act.
The Company will cause each Paying Agent other than the
Trustee to execute and deliver to the Trustee an instrument in
which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will (i)
comply with the provisions of the Trust Indenture Act applicable to
it as a Paying Agent and (ii) during the continuance of any default
by the Company (or any other obligor upon the Securities) in the
making of any payment in respect of the Securities, upon the
written request of the Trustee, forthwith pay to the Trustee all
sums held in trust by such Paying Agent as such.
The Company may at any time, for the purpose of obtaining
the satisfaction and discharge of this Indenture or for any other
purpose, pay, or by Company Order direct any Paying Agent to pay,
to the Trustee all sums held in trust by the Company or such Paying
Agent, such sums to be held by the Trustee upon the same trusts as
those upon which such sums were held by the Company or such Paying
Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with
respect to such money.
Any money deposited with the Trustee or any Paying Agent,
or then held by the Company, in trust for the payment of the
principal of (and premium, if any) or interest on any Security and
remaining unclaimed for two years after such principal (and
premium, if any) or interest has become due and payable shall be
paid to the Company on Company Request, or (if then held by the
Company) shall be discharged from such trust; and the Holder of
such Security shall thereafter, as an unsecured general creditor,
look only to the Company for payment thereof, and all liability of
the Trustee or such Paying Agent with respect to such trust money,
and all liability of the Company as trustee thereof, shall
thereupon cease; provided, however, that the Trustee or such Paying
Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in a newspaper
published in the English language, customarily published on each
Business Day and of general circulation in the Borough of Manhat-
tan, The City of New York, notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less
than 30 days from the date of such publication, any unclaimed
balance of such money then remaining will be repaid to the Company.
SECTION 1004. Statement by Officers as to Default.
The Company will deliver to the Trustee, within 120 days
after the end of each fiscal year of the Company ending after the
date hereof, an Officers' Certificate, stating whether or not to
the best knowledge of the signers thereof the Company is in default
in the performance and observance of any of the terms, provisions
and conditions of this Indenture (without regard to any period of
grace or requirement of notice provided hereunder) and, if the
Company shall be in default, specifying all such defaults and the
nature and status thereof of which they may have knowledge.
The Company will deliver to the Trustee, within fifteen
days after the occurrence thereof, written notice of any event
which after notice or lapse of time or both would become an Event
of Default pursuant to Clause (4) of Section 501.
SECTION 1005. Existence.
Subject to Article Eight, the Company will do or cause to
be done all things necessary to preserve and keep in full force and
effect its existence, rights (charter and statutory) and franchis-
es; provided, however, that the Company shall not be required to
preserve any such right or franchise if the Board of Directors
shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company and that
the loss thereof is not disadvantageous in any material respect to
the Holders.
SECTION 1006. Maintenance of Properties.
The Company will cause all properties used or useful in
the conduct of its business or the business of any Subsidiary to be
maintained and kept in good condition, repair and working order and
supplied with all necessary equipment and will cause to be made all
necessary repairs, renewals, replacements, betterments and
improvements thereof, all as in the judgment of the Company may be
necessary so that the business carried on in connection therewith
may be properly and advantageously conducted at all times;
provided, however, that nothing in this Section shall prevent the
Company from discontinuing the operation or maintenance of any of
such properties if such discontinuance is, in the judgment of the
Company, (i) desirable in the conduct of its business or the
business of any Subsidiary and (ii) not disadvantageous in any
material respect to the Holders.
SECTION 1007. Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (1) all taxes,
assessments and governmental charges levied or imposed upon the
Company or any Subsidiary or upon the income, profits or property
of the Company or any Subsidiary, and (2) all lawful claims for
labor, materials and supplies which, if unpaid, might by law become
a lien upon the property of the Company or any Subsidiary;
provided, however, that the Company shall not be required to pay or
discharge or cause to be paid or discharged any such tax, assess-
ment, charge or claim whose amount, applicability or validity is
being contested in good faith by appropriate proceedings.
ARTICLE ELEVEN
Redemption of Securities
SECTION 1101. Right of Redemption.
The Securities may be redeemed at the election of the
Company, as a whole or from time to time in part, at any time on or
after _________, 1996, at the Redemption Prices specified in the
form of Security hereinbefore set forth, together with accrued
interest to the Redemption Date.
SECTION 1102. Applicability of Article.
Redemption of Securities at the election of the Company
or otherwise, as permitted or required by any provision of this
Indenture, shall be made in accordance with such provision and this
Article.
SECTION 1103. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities
pursuant to Section 1101 shall be evidenced by a Board Resolution.
In case of any redemption at the election of the Company of less
than all the Securities, the Company shall, at least 60 days prior
to the Redemption Date fixed by the Company (unless a shorter
notice shall be satisfactory to the Trustee), notify the Trustee of
such Redemption Date and of the principal amount of Securities to
be redeemed.
SECTION 1104. Selection by Trustee of Securities to Be Redeemed.
If less than all the Securities are to be redeemed, the
particular Securities to be redeemed shall be selected not more
than 60 days prior to the Redemption Date by the Trustee, from the
Outstanding Securities not previously called for redemption, by
such method as the Trustee shall deem fair and appropriate and in
accordance with the rules of self-regulatory organizations and
which may provide for the selection for redemption of portions
(equal to $500 or any integral multiple thereof) of the principal
amount of Securities of a denomination larger than $500.
The Trustee shall promptly notify the Company and each
Security Registrar in writing of the Securities selected for
redemption and, in the case of any Securities selected for partial
redemption, the principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of
Securities shall relate, in the case of any Securities redeemed or
to be redeemed only in part, to the portion of the principal amount
of such Securities which has been or is to be redeemed.
SECTION 1105. Notice of Redemption.
Notice of redemption shall be given by first-class mail,
postage prepaid, mailed not less than 20 nor more than 60 days
prior to the Redemption Date, to each Holder of Securities to be
redeemed, at his address appearing in the Security Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the Outstanding Securities are to
be redeemed, the identification (and, in the case of partial
redemption of any Securities, the principal amounts) of the
particular Securities to be redeemed,
(4) that on the Redemption Date the Redemption Price
will become due and payable upon each such Security to be
redeemed and that interest thereon will cease to accrue on and
after said date, and
(5) the place or places where such Securities are to be
surrendered for payment of the Redemption Price.
Notice of redemption of Securities to be redeemed at the
election of the Company shall be given by the Company or, at the
Company's request, by the Trustee in the name and at the expense of
the Company.
SECTION 1106. Deposit of Redemption Price.
Prior to any Redemption Date, the Company shall deposit
with the Trustee or with a Paying Agent (or, if the Company is
acting as its own Paying Agent, segregate and hold in trust as
provided in Section 1003) an amount of money sufficient to pay the
Redemption Price of, and (except if the Redemption Date shall be an
Interest Payment Date) accrued interest on, all the Securities
which are to be redeemed on that date.
SECTION 1107. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the
Securities so to be redeemed shall, on the Redemption Date, become
due and payable at the Redemption Price therein specified, and from
and after such date (unless the Company shall default in the
payment of the Redemption Price and accrued interest) such
Securities shall cease to bear interest. Upon surrender of any
such Security for redemption in accordance with said notice, such
Security shall be paid by the Company at the Redemption Price,
together with accrued interest to the Redemption Date; provided,
however, that instalments of interest whose Stated Maturity is on
or prior to the Redemption Date shall be payable to the Holders of
such Securities, or one or more Predecessor Securities, registered
as such at the close of business on the relevant Record Dates
according to their terms and the provisions of Section 307.
If any Security called for redemption shall not be so
paid upon surrender thereof for redemption, the principal (and
premium, if any) shall, until paid, bear interest from the
Redemption Date at the rate borne by the Security.
SECTION 1108. Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall
be surrendered at an office or agency of the Company designated for
that purpose pursuant to Section 1002 (with, if the Company or the
Trustee so requires, due endorsement by, or a written instrument of
transfer in form satisfactory to the Company and the Trustee duly
executed by, the Holder thereof or his attorney duly authorized in
writing) and the Company shall execute, and the Trustee shall
authenticate and deliver to the Holder of such Security without
service charge, a new Security or Securities, of any authorized
denomination as requested by such Holder, in aggregate principal
amount equal to and in exchange for the unredeemed portion of the
principal of the Security so surrendered.
ARTICLE TWELVE
[Intentionally left blank.]
ARTICLE THIRTEEN
Subordination of Securities
SECTION 1301. Securities Subordinate to Senior Indebtedness.
The Company covenants and agrees, and each Holder of a
Security, by his acceptance thereof, likewise covenants and agrees,
that, to the extent and in the manner hereinafter set forth in this
Article, the indebtedness represented by the Securities and the
payment of the principal of (and premium, if any) and interest on
each and all of the Securities are hereby expressly made subordi-
nate and subject in right of payment to the prior payment in full
of all Senior Indebtedness.
SECTION 1302. Payment Over of Proceeds Upon Dissolution, Etc.
In the event of (a) any insolvency or bankruptcy case or
proceeding, or any receivership, liquidation, reorganization or
other similar case or proceeding in connection therewith, relative
to the Company or to its creditors, as such, or to its assets, or
(b) any liquidation, dissolution or other winding up of the
Company, whether voluntary or involuntary and whether or not
involving insolvency or bankruptcy, or (c) any assignment for the
benefit of creditors or any other marshalling of assets and
liabilities of the Company, then and in any such event the holders
of Senior Indebtedness shall be entitled to receive payment in full
of all amounts due or to become due on or in respect of all Senior
Indebtedness, or provision shall be made for such payments in cash
or otherwise in a manner satisfactory to the holders of Senior
Indebtedness, before the Holders of the Securities are entitled to
receive any payment on account of principal of (or premium, if any)
or interest on the Securities, and to that end the holders of
Senior Indebtedness shall be entitled to receive, for application
to the payment thereof, any payment or distribution of any kind or
character, whether in cash, property or securities, which may be
payable or deliverable in respect of the Securities in any such
case, proceeding, dissolution, liquidation or other winding up or
event.
In the event that, notwithstanding the foregoing
provisions of this Section, the Trustee or the Holder of any
Security shall have received any payment or distribution of assets
of the Company of any kind or character, whether in cash, property
or securities, before all Senior Indebtedness is paid in full or
payment thereof provided for, and if such fact shall, at or prior
to the time of such payment or distribution, have been made known
to the Trustee or, as the case may be, such Holder, then and in
such event such payment or distribution shall be paid over or
delivered forthwith to the trustee in bankruptcy, receiver,
liquidating trustee, custodian, assignee, agent or other Person
making payment or distribution of assets of the Company for
application to the payment of all Senior Indebtedness remaining
unpaid, to the extent necessary to pay all Senior Indebtedness in
full, after giving effect to any concurrent payment or distribution
to or for the holders of Senior Indebtedness.
For purposes of this Article only, the words "cash,
property or securities" shall not be deemed to include shares of
stock of the Company as reorganized or readjusted, or securities of
the Company or any other corporation provided for by a plan of
reorganization or readjustment which are subordinated in right of
payment to all Senior Indebtedness which may at the time be
outstanding to substantially the same extent as, or to a greater
extent than, the Securities are so subordinated as provided in this
Article. The consolidation of the Company with, or the merger of
the Company into, another Person or the liquidation or dissolution
of the Company following the conveyance or transfer of its
properties and assets substantially as an entirety to another
Person upon the terms and conditions set forth in Article Eight
shall not be deemed a dissolution, winding up, liquidation,
reorganization, assignment for the benefit of creditors or
marshalling of assets and liabilities of the Company for the
purposes of this Section if the Person formed by such consolidation
or into which the Company is merged or which acquires by conveyance
or transfer such properties and assets substantially as an
entirety, as the case may be, shall, as a part of such consolida-
tion, merger, conveyance or transfer, comply with the conditions
set forth in Article Eight.
SECTION 1303. Prior Payment to Senior Indebtedness Upon Accelera-
tion of Securities.
In the event that any Securities are declared due and
payable before their Stated Maturity, then and in such event the
holders of Senior Indebtedness outstanding at the time such
Securities so become due and payable shall be entitled to receive
payment in full of all amounts due on or in respect of such Senior
Indebtedness, or provision shall be made for such payment in cash
or otherwise in a manner satisfactory to the holders of Senior
Indebtedness, before the Holders of the Securities are entitled to
receive any payment (including any payment which may be payable by
reason of the payment of any other indebtedness of the Company
being subordinated to the payment of the Securities) by the Company
on account of the principal of (or premium, if any) or interest on
the Securities or on account of the purchase or other acquisition
of Securities.
In the event that, notwithstanding the foregoing, the
Company shall make any payment to the Trustee or the Holder of any
Security prohibited by the foregoing provisions of this Section,
and if such fact shall, at or prior to the time of such payment,
have been made known to the Trustee or, as the case may be, such
Holder, then and in such event such payment shall be paid over and
delivered forthwith to the Company.
The provisions of this Section shall not apply to any
payment with respect to which Section 1302 would be applicable.
SECTION 1304. No Payment When Senior Indebtedness in Default.
(a) In the event and during the continuation of any
default in the payment of principal of (or premium, if any) or
interest on any Senior Indebtedness, or in the event that any event
of default with respect to any Senior Indebtedness shall have
occurred and be continuing, unless and until such event of default
shall have been cured or waived or shall have ceased to exist, or
(b) in the event any judicial proceeding shall be pending with
respect to any such default in payment or event of default, then no
payment shall be made by the Company on account of principal of (or
premium, if any) or interest on the Securities or on account of the
purchase or other acquisition of Securities.
In the event that, notwithstanding the foregoing, the
Company shall make any payment to the Trustee or the Holder of any
Security prohibited by the foregoing provisions of this Section,
and if such fact shall, at or prior to the time of such payment,
have been made known to the Trustee or, as the case may be, such
Holder, then and in such event such payment shall be paid over and
delivered forthwith to the Company.
The provisions of this Section shall not apply to any
payment with respect to which Section 1302 would be applicable.
SECTION 1305. Payment Permitted If No Default.
Subject to the limitations set forth in the following
paragraphs of this Section, nothing contained in this Article or
elsewhere in this Indenture or in any of the Securities shall
prevent (a) the Company, at any time except during the pendency of
any case, proceeding, dissolution, liquidation or other winding up,
assignment for the benefit of creditors or other marshalling of
assets and liabilities of the Company referred to in Section 1302
or under the conditions described in Section 1303 or 1304, from
making payments at any time of principal of (and premium, if any)
or interest on the Securities, or (b) the application by the
Trustee of any money deposited with it hereunder to the payment of
or on account of the principal of (and premium, if any) or interest
on the Securities or the retention of such payment by the Holders,
if, at the time of such application by the Trustee, it did not have
knowledge that such payment would have been prohibited by the
provisions of this Article.
Each Holder of a Security, by his acceptance thereof,
acknowledges that pursuant to the provisions of the instruments
evidencing the indebtedness included within Clause (a) of the
definition of Senior Indebtedness and agreements associated
therewith (the "Decisions Debt") the Company is obligated to
provide to Decisions at least ten days' advance written notice
("Company Notice") in the event the Company shall desire to make a
principal (and, if applicable, premium) payment on account of any
of the Securities, and Decisions has the right within five days
following its receipt of a Company Notice to deliver a written
notice ("Decisions Notice") to the Company declaring all or any
portion of the outstanding interest and principal of the Decisions
Debt to be immediately due and payable. Each Holder of a Security,
by his acceptance thereof, agrees and further acknowledges that in
the event that Decisions shall deliver timely a Decisions Notice,
then the Company shall make no payment on account of any of the
Securities until the amount (the "Decisions Amount") of the
Decisions Debt declared to be due and immediately payable in such
Decisions Notice is paid to Decisions by the Company. The failure
of the Company to deliver timely a Company Notice or any payment by
the Company on account of any of the Securities prior to the
payment in full of the Decisions Amount, in each case shall
constitute an event of default under the instruments evidencing the
Decisions Debt and agreements associated therewith.
In the event that, notwithstanding the foregoing, the
Trustee or the Holder of any Security shall receive a payment from
the Company (i) at a time when an event of default shall have
occurred and be continuing under the instruments evidencing the
Decisions Debt and agreements associated therewith or (ii) that is
otherwise prohibited by the foregoing provisions of this Section,
then and in each such event such payment shall be paid over and
delivered forthwith to the Company.
SECTION 1306. Subrogation to Rights of Holders of Senior Indebt-
edness.
Subject to the payment in full of all Senior
Indebtedness, the Holders of the Securities shall be subrogated to
the extent of the payments or distributions made to the holders of
such Senior Indebtedness pursuant to the provisions of this Article
(equally and ratably with the holders of all indebtedness of the
Company which by its express terms is subordinated to indebtedness
of the Company to substantially the same extent as the Securities
are subordinated and is entitled to like rights of subrogation) to
the rights of the holders of such Senior Indebtedness to receive
payments and distributions of cash, property and securities
applicable to the Senior Indebtedness until the principal of (and
premium, if any) and interest on the Securities shall be paid in
full. For purposes of such subrogation, no payments or distribu-
tions to the holders of the Senior Indebtedness of any cash,
property or securities to which the Holders of the Securities or
the Trustee would be entitled except for the provisions of this
Article, and no payments over pursuant to the provisions of this
Article to the holders of Senior Indebtedness by Holders of the
Securities or the Trustee, shall, as among the Company, its
creditors other than holders of Senior Indebtedness and the Holders
of the Securities, be deemed to be a payment or distribution by the
Company to or on account of the Senior Indebtedness.
SECTION 1307. Provisions Solely to Define Relative Rights.
The provisions of this Article are and are intended
solely for the purpose of defining the relative rights of the
Holders of the Securities on the one hand and the holders of Senior
Indebtedness on the other hand. Nothing contained in this Article
or elsewhere in this Indenture or in the Securities is intended to
or shall (a) impair, as among the Company, its creditors other than
holders of Senior Indebtedness and the Holders of the Securities,
the obligation of the Company, which is absolute and unconditional
(and which, subject to the rights under this Article of the holders
of Senior Indebtedness, is intended to rank equally with all other
general obligations of the Company), to pay to the Holders of the
Securities the principal of (and premium, if any) and interest on
the Securities as and when the same shall become due and payable in
accordance with their terms; or (b) affect the relative rights
against the Company of the Holders of the Securities and creditors
of the Company other than the holders of Senior Indebtedness; or
(c) prevent the Trustee or the Holder of any Security from
exercising all remedies otherwise permitted by applicable law upon
default under this Indenture, subject to the rights, if any, under
this Article of the holders of Senior Indebtedness to receive cash,
property and securities otherwise payable or deliverable to the
Trustee or such Holder.
SECTION 1308. Trustee to Effectuate Subordination.
Each Holder of a Security by his acceptance thereof
authorizes and directs the Trustee on his behalf to take such
action as may be necessary or appropriate to effectuate the
subordination provided in this Article and appoints the Trustee his
attorney-in-fact for any and all such purposes.
SECTION 1309. No Waiver of Subordination Provisions.
No right of any present or future holder of any Senior
Indebtedness to enforce subordination as herein provided shall at
any time in any way be prejudiced or impaired by any act or failure
to act on the part of the Company or by any act or failure to act,
in good faith, by any such holder, or by any noncompliance by the
Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof any such holder may have or be
otherwise charged with.
Without in any way limiting the generality of the
foregoing paragraph, the holders of Senior Indebtedness may, at any
time and from time to time, without the consent of or notice to the
Trustee or the Holders of the Securities, without incurring
responsibility to the Holders of the Securities and without
impairing or releasing the subordination provided in this Article
or the obligations hereunder of the Holders of the Securities to
the holders of Senior Indebtedness, do any one or more of the
following: (i) change the manner, place or terms of payment or
extend the time of payment of, or renew or alter, Senior
Indebtedness, or otherwise amend or supplement in any manner Senior
Indebtedness or any instrument evidencing the same or any agreement
under which Senior Indebtedness is outstanding; (ii) sell,
exchange, release or otherwise deal with any property pledged,
mortgaged or otherwise securing Senior Indebtedness; (iii) release
any Person liable in any manner for the collection of Senior
Indebtedness; and (iv) exercise or refrain from exercising any
rights against the Company and any other Person.
SECTION 1310. Notice to Trustee.
The Company shall give prompt written notice to the
Trustee of any fact known to the Company which would prohibit the
making of any payment to or by the Trustee in respect of the
Securities. Notwithstanding the provisions of this Article or any
other provision of this Indenture, the Trustee shall not be charged
with knowledge of the existence of any facts which would prohibit
the making of any payment to or by the Trustee in respect of the
Securities, unless and until the Trustee shall have received
written notice thereof from the Company or a holder of Senior
Indebtedness or from any trustee therefor; and, prior to the
receipt of any such written notice, the Trustee, subject to the
provisions of Section 601, shall be entitled in all respects to
assume that no such facts exist; provided, however, that if the
Trustee shall not have received the notice provided for in this
Section at least five Business Days prior to the date upon which by
the terms hereof any money may become payable for any purpose
(including, without limitation, the payment of the principal of
(and premium, if any) or interest on any Security), then, anything
herein contained to the contrary notwithstanding, the Trustee shall
have full power and authority to receive such money and to apply
the same to the purpose for which such money was received and shall
not be affected by any notice to the contrary which may be received
by it within five Business Days prior to such date; nor shall the
Trustee be charged with knowledge of the curing of any such default
or the elimination of the act or condition preventing any such
payment unless and until the Trustee shall have received an
Officer's Certificate to such effect.
Subject to the provisions of Section 601, the Trustee
shall be entitled to rely on the delivery to it of a written notice
by a Person representing himself to be a holder of Senior
Indebtedness (or a trustee therefor) to establish that such notice
has been given by a holder of Senior Indebtedness (or a trustee
therefor). In the event that the Trustee determines in good faith
that further evidence is required with respect to the right of any
Person as a holder of Senior Indebtedness to participate in any
payment or distribution pursuant to this Article, the Trustee may
request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Senior Indebtedness
held by such Person, the extent to which such Person is entitled to
participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Article, and if
such evidence is not furnished, the Trustee may defer any payment
to such Person pending judicial determination as to the right of
such Person to receive such payment.
SECTION 1311. Reliance on Judicial Order or Certificate of Liqui-
dating Agent.
Upon any payment or distribution of assets of the Company
referred to in this Article, the Trustee, subject to the provisions
of Section 601, and the Holders of the Securities shall be entitled
to rely upon any order or decree entered by any court of competent
jurisdiction in which such insolvency, bankruptcy, receivership,
liquidation, reorganization, dissolution, winding up or similar
case or proceeding is pending, or a certificate of the trustee in
bankruptcy, receiver, liquidating trustee, custodian, assignee for
the benefit of creditors, agent or other Person making such payment
or distribution, delivered to the Trustee or to the Holders of
Securities, for the purpose of ascertaining the Persons entitled to
participate in such payment or distribution, the holders of the
Senior Indebtedness and other indebtedness of the Company, the
amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to
this Article.
SECTION 1312. Trustee Not Fiduciary for Holders of Senior Indebt-
edness.
With respect to the holders of Senior Indebtedness, the
Trustee undertakes to perform or to observe only such of its
covenants and obligations as are specifically set forth in this
Article, and no implied covenants or obligations with respect to
the holders of Senior Indebtedness shall be read into this
Indenture against the Trustee. The Trustee shall not be deemed to
owe any fiduciary duty to the holders of Senior Indebtedness and
shall not be liable to any such holders if it shall in good faith
mistakenly pay over or distribute to Holders of Securities or to
the Company or to any other Person cash, property or securities to
which any holders of Senior Indebtedness shall be entitled by
virtue of this Article or otherwise.
SECTION 1313. Rights of Trustee as Holder of Senior Indebtedness;
Preservation of Trustee's Rights.
The Trustee in its individual capacity shall be entitled
to all the rights set forth in this Article with respect to any
Senior Indebtedness which may at any time be held by it, to the
same extent as any other holder of Senior Indebtedness, and nothing
in this Indenture shall deprive the Trustee of any of its rights as
such holder.
Nothing in this Article shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 607.
SECTION 1314. Article Applicable to Paying Agents.
In case at any time any Paying Agent other than the
Trustee shall have been appointed by the Company and be then acting
hereunder, the term "Trustee" as used in this Article shall in such
case (unless the context otherwise requires) be construed as
extending to and including such Paying Agent within its meaning as
fully for all intents and purposes as if such Paying Agent were
named in this Article in addition to or in place of the Trustee;
provided, however, that Section 1313 shall not apply to the Company
or any Affiliate of the Company if it or such Affiliate acts as
Paying Agent.
SECTION 1315. Rights of Holders of Senior Indebtedness.
The subordination provisions contained herein are for the
benefit of the holders of Senior Indebtedness and may be enforced
directly by them against the Holders of the Securities and the
Trustee. The holders of the Senior Indebtedness have relied upon
and will rely upon the subordination provided for herein in
entering into the agreements to which they are a party. No holder
of Senior Indebtedness shall be required by the Holders of the
Securities or the Trustee to give notice of or prove reliance
hereon.
SECTION 1316. Consent to Amendments of Subordination Provisions.
Any other provision of this Indenture notwithstanding,
the provisions of this Article Thirteen may not be amended,
modified or eliminated without the prior written consent of the
holders of all Senior Indebtedness then outstanding.
ARTICLE FOURTEEN
Right to Require Repurchase
SECTION 1401. Right to Require Repurchase.
In the event of any Change in Control, each Holder of the
Securities shall have the right, at such Holder's option, to
require the Company to repurchase, and upon the exercise of such
right the Company shall purchase, all or any part of such Holder's
Securities (in increments of $500 principal amount) on the date
(the "Repurchase Date") that is 45 calendar days after the date of
notice of such Change in Control at the price (the "Repurchase
Price") specified in the form of security hereinbefore set forth,
plus accrued and unpaid interest to the Repurchase Date. This right
to require repurchase at the option of the Holder is subject to the
restriction that the Company may not repurchase any Security at any
time when the subordination provisions of this Indenture would not
permit the Company to make a payment of principal, premium or
interest on the Securities. Except where inconsistent with the
provisions of this Article Fourteen, the redemption provisions of
Article Eleven shall be applicable to repurchases under this
Article Fourteen.
SECTION 1402. Notice; Method of Exercising Repurchase Right.
(a) On or before the 30th calendar day after any Change
in Control, the Company shall give or cause to be given notice of
a Change in Control and of the repurchase right set forth herein
arising as a result thereof by first class mail, postage prepaid,
to each Holder of the Securities at such Holder's address appearing
in the Security Register. The Company shall also cause a copy of
such notice of a repurchase right to be published in a newspaper of
general circulation in the Borough of Manhattan, The City of New
York. The Company shall notify the Trustee in writing of the
occurrence of any event constituting a Change in Control as
promptly as practical after such occurrence.
Each notice of a repurchase right shall state:
(1) the Repurchase Date,
(2) the Repurchase Price,
(3) the date by which the repurchase right must be
exercised, and
(4) a description of the procedure which a Holder must
follow to exercise a repurchase right.
No failure of the Company to give the foregoing notice
shall limit any Holder's right to exercise a repurchase right.
(b) To exercise a repurchase right, a Holder shall
deliver to the Company (or an agent designated by the Company for
such purpose in the notice referred to in (a) above) on or before
the 30th calendar day after the date of the Company notice provided
under this Section 1402 (i) written notice of the Holder's exercise
of such right, which notice shall set forth the name of the Holder,
the principal amount of the Securities (or portion of a Security)
to be repurchased and a statement that the option to exercise the
repurchase right is being made thereby, and (ii) the Securities
with respect to which the repurchase right is being exercised, duly
endorsed for transfer to the Company. Such written notice shall be
irrevocable. If the Repurchase Date falls between any Regular
Record Date and the next succeeding Interest Payment Date,
Securities to be repurchased must be accompanied by payment from
the Holder of an amount equal to the interest thereon which the
registered Holder is to receive on such Interest Payment Date.
(c) In the event a repurchase right shall be exercised in
accordance with the terms hereof, the Company shall pay or cause to
be paid the price payable with respect to the Security or
Securities as to which the repurchase right has been exercised in
cash to the Holder of such Security or Securities on the Repurchase
Date. In the event that a repurchase right is exercised with
respect to less than the entire principal amount of a surrendered
Security, the Company shall execute and deliver to the Trustee and
the Trustee shall authenticate for issuance in the name of the
Holder a new Security or Securities in the aggregate principal
amount of the unrepurchased portion of such surrendered Security.
SECTION 1403. Deposit of Repurchase Price.
Prior to the Repurchase Date, the Company shall deposit
with the Trustee or with a Paying Agent (or, if the Company is
acting as its own Paying Agent, segregate and hold in trust as
provided in Section 1003) an amount of money sufficient to pay the
Repurchase Price of the Securities which are to be repaid on the
Repurchase Date.
SECTION 1404. Securities Not Repurchased on Repurchase.
If any Security surrendered for repurchase shall not be
so paid on the Repurchase Date, the principal shall, until paid,
bear interest to the extent permitted by applicable law from the
Repurchase Date at a rate per annum borne by such Security.
SECTION 1405. Securities Repurchased in Part.
Any Security which is to be repurchased only in part
shall be surrendered at any office or agency of the Company
designated for that purpose pursuant to Section 1002 (with, if the
Company or the Trustee so requires, due endorsement by, or a
written instrument of transfer in form satisfactory to the Company
and the Trustee duly executed by, the Holder thereof or his
attorney duly authorized in writing), and the Company shall
execute, and the Trustee shall authenticate and deliver to the
Holder of such Security without service charge, a new Security or
Securities of any authorized denomination as requested by such
Holder, in aggregate principal amount equal to and in exchange for
the unrepurchased portion of the principal of the Security so
surrendered.
SECTION 1406. Certain Definitions.
As used only in this Article Fourteen: (a) As used
herein, a "Change in Control" of the Company shall be deemed to
have occurred at such time as any Person (other than Decisions and
its Affiliates), together with its Affiliates or Associates, is or
becomes the beneficial owner, directly or indirectly, through a
purchase, merger or other acquisition transaction, of shares of
capital stock of the Company entitling such person to exercise 75%
or more of the total voting power of all shares of capital stock of
the Company entitled to vote in elections of directors, provided
that a Change in Control shall not be deemed to have occurred if
either (i) the last reported sale price of the Common Stock as
reported on the American Stock Exchange (or, if not listed on the
American Stock Exchange, as reported on such other national
securities exchange on which the Common Stock is listed for trading
or, if not so listed, as quoted on the National Association of
Securities Dealers Automated Quotations National Market System or,
if the Common Stock is not listed or admitted to trading on any
national securities exchange or quoted on such National Market
System, the average of the closing bid and asked prices in the
over-the-counter market as furnished by any New York Stock Exchange
member firm selected from time to time by the Board of Directors
for that purpose and is acceptable to the Trustee), for any five
trading days during the ten trading days immediately preceding the
Change in Control is at least equal to 105% of the Reference Price
in effect on such day or (ii) at least 90% of the consideration
(excluding cash payments for fractional shares) in the transaction
or transactions constituting the Change in Control consists of
shares of common stock traded on a national securities exchange or
through National Association of Securities Dealers Automated
Quotations National Market System or another comparable quotation
system;
(b) an "Associate" of, or a Person "associated" with, any
Person, means (i) any trust or other estate in which such Person
has a substantial beneficial interest or as to which such Person
serves as trustee or in a similar fiduciary capacity and (ii) any
relative or spouse of such Person, or any relative of such spouse,
who has the same home as such Person; and
(c) the term "beneficial owner" shall be determined in
accordance with Rule 13d-3 promulgated by the Commission under the
Securities Exchange Act of 1934.
SECTION 1407. Adjustment of Reference Price.
(1) In case the Company shall pay or make a dividend or
other distribution on any class of capital stock of the
Company in Common Stock, the Reference Price in effect at the
opening of business on the day following the date fixed for
the determination of stockholders entitled to receive such
dividend or other distribution shall be reduced by multiplying
such Reference Price by a fraction of which the numerator
shall be the number of shares of Common Stock outstanding at
the close of business on the date fixed for such determination
and the denominator shall be the sum of such number of shares
and the total number of shares constituting such dividend or
other distribution, such reduction to become effective
immediately after the opening of business on the day following
the date fixed for such determination. For the purposes of
this paragraph (1), the number of shares of Common Stock at
any time outstanding shall not include shares held in the
treasury of the Company but shall include shares issuable in
respect of scrip certificates issued in lieu of fractions of
shares of Common Stock. The Company will not pay any dividend
or make any distribution on shares of Common Stock held in the
treasury of the Company.
(2) In case the Company shall issue rights or warrants
to all holders of its Common Stock entitling them to subscribe
for or purchase shares of Common Stock at a price per share
less than the current market price per share (determined as
provided in paragraph (6) of this Section) of the Common Stock
on the date fixed for the determination of stockholders
entitled to receive such rights or warrants (other than
pursuant to a dividend reinvestment plan), the Reference Price
in effect at the opening of business on the day following the
date fixed for such determination shall be reduced by
multiplying such Reference Price by a fraction of which the
numerator shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for
such determination plus the number of shares of Common Stock
which the aggregate of the offering price of the total number
of shares of Common Stock so offered for subscription or
purchase would purchase at such current market price and the
denominator shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for
such determination plus the number of shares of Common Stock
so offered for subscription or purchase, such reduction to
become effective immediately after the opening of business on
the day following the date fixed for such determination. For
the purposes of this paragraph (2) the number of shares of
Common Stock at any time outstanding shall not include shares
held in the treasury of the Company but shall include shares
issuable in respect of scrip certificates issued in lieu of
fractions of shares of Common Stock. The Company will not
issue any rights or warrants in respect of shares of Common
Stock held in the treasury of the Company.
(3) In case outstanding shares of Common Stock shall be
subdivided into a greater number of shares of Common Stock,
the Reference Price in effect at the opening of business on
the day following the day upon which such subdivision becomes
effective shall be proportionately reduced, and, conversely,
in case outstanding shares of Common Stock shall each be
combined into a smaller number of shares of Common Stock, the
Reference Price in effect at the opening of business on the
day following the day upon which such combination becomes
effective shall be proportionately increased, such reduction
or increase, as the case may be, to become effective
immediately after the opening of business on the day following
the day upon which such subdivision or combination becomes
effective.
(4) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock evidences of its
indebtedness or assets (including securities, but excluding
any rights or warrants referred to in paragraph (2) of this
Section, any dividend or distribution paid in cash out of the
earned surplus of the Company and any dividend or distribution
referred to in paragraph (1) of this Section), the Reference
Price shall be adjusted so that the same shall equal the price
determined by multiplying the Reference Price in effect
immediately prior to the close of business on the date fixed
for the determination of stockholders entitled to receive such
distribution by a fraction of which the numerator shall be the
current market price per share (determined as provided in
paragraph (6) of this Section) of the Common Stock on the date
fixed for such determination less the then fair market value
(as determined by the Board of Directors, whose determination
shall be conclusive and described in a Board Resolution filed
with the Trustee) of the portion of the assets or evidences of
indebtedness so distributed applicable to one share of Common
Stock and the denominator shall be such current market price
per share of the Common Stock, such adjustment to become
effective immediately prior to the opening of business on the
day following the date fixed for the determination of
stockholders entitled to receive such distribution. In any
case in which this paragraph (4) is applicable, paragraph (2)
of this Section shall not be applicable.
(5) The reclassification of Common Stock into securities
including securities other than Common Stock shall be deemed
to involve (a) a distribution of such securities other than
Common Stock to all holders of Common Stock (and the effective
date of such reclassification shall be deemed to be "the date
fixed for the determination of stockholders entitled to
receive such distribution" and the "date fixed for such
determination" within the meaning of paragraph (4) of this
Section), and (b) a subdivision or combination, as the case
may be, of the number of shares of Common Stock outstanding
immediately prior to such reclassification into the number of
shares of Common Stock outstanding immediately thereafter (and
the effective date of such reclassification shall be deemed to
be "the day upon which such subdivision becomes effective" or
"the day upon which such combination becomes effective", as
the case may be, and "the day upon which such subdivision or
combination becomes effective" within the meaning of paragraph
(3) of this Section).
(6) For the purpose of any computation under paragraphs
(2) and (4) of this Section, the current market price per
share of Common Stock on any day shall be deemed to be the
average of the daily closing prices for the five consecutive
trading days (i.e., Business Days on which the Common Stock is
traded) selected by the Board of Directors commencing not more
than 20 trading days before, and ending not later than, the
earlier of the day in question and the day before the "ex"
date with respect to the issuance or distribution requiring
such computation. For this purpose, the term "'ex' date",
when used with respect to any issuance or distribution, shall
mean the first date on which the Common Stock trades regular
way on the applicable exchange or in the applicable market
without the right to receive such issuance or distribution.
The closing price for each day shall be the reported last sale
price regular way or, in case no such reported sale takes
place on such day, the average of the reported closing bid and
asked prices regular way, in either case on the American Stock
Exchange or, if the Common Stock is not listed or admitted to
trading on such Exchange, on the principal national securities
exchange on which the Common Stock is listed or admitted to
trading or, if not listed or admitted to trading on any
national securities exchange, on the National Association of
Securities Dealers Automated Quotations National Market System
or, if the Common Stock is not listed or admitted to trading
on any national securities exchange or quoted on such National
Market System, the average of the closing bid and asked prices
in the over-the-counter market as furnished by any New York
Stock Exchange member firm selected from time to time by the
Board of Directors for that purpose and is acceptable to the
Trustee.
(7) No adjustment in the Reference Price shall be
required unless such adjustment (plus any adjustments not
previously made by reason of this paragraph (7)) would require
an increase or decrease of at least 1% in such price;
provided, however, that any adjustments which by reason of
this paragraph (7) are not required to be made shall be
carried forward and taken into account in any subsequent
adjustment. All calculations under this paragraph (7) shall
be made to the nearest cent.
SECTION 1408. Trustee's Disclaimer.
The Trustee has no duty to determine when an adjustment under
this Article should be made, how it should be made or what it
should be.
______________________
This instrument may be executed in any number of
counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but
one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals
to be hereunto affixed and attested, all as of the day and year
first above written.
Advanced Medical, Inc.
By ___________________
Name: Joseph W. Kuhn
Title: President
Attest:
By
Name:
Title: Secretary
United States Trust Company of
New York
By ___________________
Name:
Title:
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the __ day of _______, 1995, before me personally came
Joseph W. Kuhn, to me known, who, being by me duly sworn, did
depose and say that he is President of Advanced Medical, Inc., one
of the corporations described in and which executed the foregoing
instrument; that he knows the seal of said corporation; that the
seal affixed to said instrument is such corporate seal; that it was
so affixed by authority of the Board of Directors of said corpora-
tion, and that he signed his name thereto by like authority.
Notary Public
(notary seal)
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the __ day of _______, 1995, before me personally came
____________, to me known, who, being by me duly sworn, did depose
and say that he is ______________ of United States Trust Company of
New York, one of the corporations described in and which executed
the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such
corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation, and that he signed his name thereto
by like authority.
Notary Public
(notary seal)