-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, TA+HkJqV7AA5NAZA5UwXZOuCQ1cLBpFtCsi4am8FHJxO9qA2YaFHMjQLNVUnBD0W hXfRkehqHAUoSRcOG4RIVA== 0000950137-99-001658.txt : 19990517 0000950137-99-001658.hdr.sgml : 19990517 ACCESSION NUMBER: 0000950137-99-001658 CONFORMED SUBMISSION TYPE: S-3 PUBLIC DOCUMENT COUNT: 6 FILED AS OF DATE: 19990514 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GREAT LAKES CHEMICAL CORP CENTRAL INDEX KEY: 0000043362 STANDARD INDUSTRIAL CLASSIFICATION: MISCELLANEOUS CHEMICAL PRODUCTS [2890] IRS NUMBER: 951765035 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3 SEC ACT: SEC FILE NUMBER: 333-78515 FILM NUMBER: 99623862 BUSINESS ADDRESS: STREET 1: ONE GREAT LAKES BLVD STREET 2: P O BOX 2200 CITY: WEST LAFAYETTE STATE: IN ZIP: 47996 BUSINESS PHONE: 3177153000 FORMER COMPANY: FORMER CONFORMED NAME: MCCLANAHAN OIL CO DATE OF NAME CHANGE: 19700925 FORMER COMPANY: FORMER CONFORMED NAME: GREAT LAKES OIL & CHEMICAL CO DATE OF NAME CHANGE: 19700925 S-3 1 FORM S-3 1 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 14, 1999 REGISTRATION NO. 333- ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------ FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------------------ GREAT LAKES CHEMICAL CORPORATION (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) DELAWARE 95-1765035 (STATE OR OTHER JURISDICTION OF INCORPORATION) (I.R.S. EMPLOYER IDENTIFICATION NO.)
500 EAST 96TH STREET, SUITE 500 INDIANAPOLIS, INDIANA 46240 (317) 715-3000 (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES) ------------------------ KAREN W. DUROS WITH A COPY TO: GREAT LAKES CHEMICAL CORPORATION CARTER W. EMERSON, P.C. 500 EAST 96TH STREET, SUITE 500 KIRKLAND & ELLIS INDIANAPOLIS, INDIANA 46240 200 EAST RANDOLPH DRIVE (317) 715-3000 CHICAGO, ILLINOIS 60601 (NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE) ------------------------ APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time to time after the effective date of this Registration Statement. If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. [ ] If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. [X] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act of 1933, please check the following box and list the Securities Act registration statement number of the earlier registration statement for the same offering. [ ] If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act of 1933, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If delivery of the prospectus is expected to be made pursuant to Rule 434 under the Securities Act of 1933, please check the following box. [ ] ------------------------ CALCULATION OF REGISTRATION FEE
================================================================================================================== PROPOSED TITLE OF EACH CLASS OF AMOUNT TO BE MAXIMUM AGGREGATE AMOUNT OF SECURITIES TO BE REGISTERED REGISTERED(3) OFFERING PRICE(4) REGISTRATION FEE(5) - ------------------------------------------------------------------------------------------------------------------ Debt Securities, Common Stock, par value $1.00 per share(1), Common Stock and Note Purchase Rights ("Rights")(2), Debt Securities Warrants, Common Stock Warrants and Currency Warrants............. $750,000,000 $750,000,000 $158,500 ================================================================================================================== - ------------------------------------------------------------------------------------------------------------------
(1) Includes such presently indeterminable number of shares of Common Stock, par value $1.00 per share, as may be issuable from time to time upon conversion of Debt Securities. (2) Represents Rights held by holders of shares of the Registrant's Common Stock from time to time pursuant to the Registrant's Rights Agreement, dated February 15, 1999. (3) Or the equivalent thereof in one or more foreign currencies or composite currencies. If any Debt Securities or Debt Securities Warrants are issued at an original issue discount, represents such greater principal amount of such securities as shall result in net proceeds to the Registrant of such amount. (4) Estimated solely for purposes of calculating the registration fee pursuant to Rule 457(c). (5) The registration fee has been calculated pursuant to Rule 457(o) and reflects the offering price, rather than the principal amount of any Debt Securities issued at a discount. The registration fee has been reduced by $50,000, the amount of the registration fee paid in connection with the unused portion of the Company's Registration Statement on Form S-3 (File No. 33-42473) filed August 28, 1991 (the "Unused Registration Statement"), pursuant to Rule 429 under the Securities Act of 1933, as amended. This Registration Statement, which is a new registration statement, also constitutes Post-Effective Amendment No. 1 to Unused Registration Statement such Amendment shall become effective concurrently with the effectiveness of this Registration Statement and in accordance with Section 8(c) of the Securities Act of 1933. ------------------------ THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE. ================================================================================ 2 THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED. SUBJECT TO COMPLETION, DATED MAY 14, 1999 PROSPECTUS GREAT LAKES CHEMICAL CORPORATION $750,000,000 DEBT SECURITIES AND DEBT WARRANTS COMMON STOCK, RIGHTS AND COMMON STOCK WARRANTS CURRENCY WARRANTS ------------------------- We will use this prospectus to offer and sell securities from time to time. These may include: - - unsecured senior debt securities - - unsecured subordinated debt securities - - warrants to purchase debt securities - - common stock - - rights issued under our rights plan - - warrants to purchase common stock - - warrants to receive the cash value in U.S. dollars of the right to purchase or sell a foreign currency or currency units - - units consisting of any combination of these securities We will provide the specific terms and conditions of these securities in supplements to this prospectus prepared in connection with each offering. These terms and conditions may include: In the case of debt securities: - - interest rate - - maturity - - ranking - - redemption or repayment prior to maturity - - additional covenants In the case of warrants: - - expiration date - - exercise price - - conditions to exercisability In the case of currency warrants: - - base foreign currency or currency units - - formula for determining value - - conditions to exercisability In the case of any securities: - - price - - size of offering - - underwriting discounts and commissions The securities offered will contain other significant terms and conditions. Please read this prospectus and the applicable prospectus supplement carefully before you invest. ------------------------ Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. ------------------------ The date of this prospectus is May , 1999. 3 TABLE OF CONTENTS About This Prospectus....................................... 2 Where You Can Find More Information......................... 3 Great Lakes Chemical Corporation............................ 4 Use of Proceeds............................................. 4 Ratio of Earnings to Fixed Charges.......................... 4 Description of Debt Securities.............................. 5 Description of Debt Warrants................................ 18 Description of Common Stock and Rights...................... 19 Description of Stock Warrants............................... 22 Description of Currency Warrants............................ 23 Plan of Distribution........................................ 25 Legal Matters............................................... 26 Experts..................................................... 26
ABOUT THIS PROSPECTUS This prospectus is part of a registration statement that we filed with the Securities and Exchange Commission (the "SEC") using a "shelf" registration process. Under this shelf process, we may sell: - - unsecured senior debt securities - - unsecured subordinated debt securities - - warrants to purchase debt securities - - common stock - - rights issued under our rights plan - - warrants to purchase common stock - - warrants to receive the cash value in U.S. dollars of the right to purchase or sell a foreign currency or currency units - - units consisting of any combination of these securities in one or more offerings up to a total dollar amount of $750,000,000. This prospectus provides you with a general description of the securities we may offer. Each time we sell securities, we will provide a prospectus supplement that will contain specific information about the terms of that offering. The prospectus supplement may also add, update or change information contained in this prospectus. You should read both this prospectus and the applicable prospectus supplement together with the additional information described below under the heading "Where You Can Find More Information." The registration statement of which this prospectus constitutes a part (including the exhibits) contains additional important information about us and the securities offered under this prospectus. Specifically, the legal documents that control the terms of any securities offered by this prospectus are filed with the SEC as exhibits to the registration statement. That registration statement can be read at the SEC's web site or at the SEC offices mentioned under the heading "Where You Can Find More Information." We may sell the securities to or through underwriters or dealers and may also sell securities directly to other purchasers or through agents. See "Plan of Distribution." The applicable prospectus supplement contains the names of any underwriters, dealers or agents involved in the sale of any securities and any applicable fee, commission or discount arrangements with them. This prospectus may not be used to consummate sales of any securities described herein unless accompanied by a prospectus supplement. 2 4 WHERE YOU CAN FIND MORE INFORMATION We file annual, quarterly and special reports, proxy statements and other information with the SEC. You may read and copy any document we file with the SEC at its public reference facilities at: - 450 Fifth Street, N.W., Washington, D.C. 20549 - 7 World Trade Center, Suite 1300, New York, New York 10048 - Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511 You can also obtain copies of our filings at prescribed rates by writing to the Public Reference Section of the SEC at 450 Fifth Street, N.W., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the operation of the public reference facilities. Our SEC filings are also available to the public over the Internet on the SEC's web site at http://www.sec.gov and at the office of The New York Stock Exchange at 20 Broad Street, New York, New York 10005. For further information on obtaining copies of our public filings at the New York Stock Exchange, you should call (212) 656-5060. We "incorporate by reference" into this prospectus the information we file with the SEC, which means that we can disclose important information to you by referring you to those documents. The information incorporated by reference is an important part of this prospectus and any information that we file subsequently with the SEC will automatically update this prospectus. We incorporate by reference: - our Annual Report on Form 10-K for the year ended December 31, 1998, as amended - our Quarterly Report on Form 10-Q for the period ended March 31, 1999 - our proxy statement for our 1998 annual meeting of stockholders as filed with the SEC on March 29, 1999 - our Registration Statement on Form 8-A filed with the SEC on March 23, 1999 relating to our rights plan - any filings we make with the SEC under Sections 13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of 1934 until we sell all of the securities offered by this prospectus. You may request a copy of these filings (other than exhibits, unless that exhibit is specifically incorporated by reference into that filing) at no cost, by writing to or telephoning us at the following address and telephone number: Jeffrey Potrzebowski Director of Investor Relations 500 East 96th Street, Suite 500 Indianapolis, Indiana 46240 (317) 715-3000 You should rely only on the information incorporated by reference or set forth in this prospectus or the applicable prospectus supplement. We have not authorized anyone else to provide you with different information. We may only use this prospectus to sell securities if it is accompanied by a prospectus supplement. We are only offering these securities in states where the offer is permitted. You should not assume that the information in this prospectus or the applicable prospectus supplement is accurate as of any date other than the dates on the front of those documents. 3 5 GREAT LAKES CHEMICAL CORPORATION Great Lakes Chemical Corporation is a Delaware corporation incorporated in 1933, having its principal executive offices in Indianapolis, Indiana. The Company's operations focus on the manufacture of performance chemicals, water treatment chemicals, polymer additive chemicals and energy products and services. Our principal executive office is located at 500 East 96th Street, Suite 500, Indianapolis, Indiana 46240 and our telephone number is (317) 715-3000. As used in this prospectus and the accompanying prospectus supplement, "we," "us," "our," "Great Lakes" or the "Company" refers to Great Lakes Chemical Corporation and its consolidated subsidiaries, unless otherwise indicated by the context. USE OF PROCEEDS Unless we specify otherwise in the applicable prospectus supplement, we will use the net proceeds from the sale of the offered securities for general corporate purposes, including working capital, the repayment or refinancing of our indebtedness, future acquisitions and/or capital expenditures. Until we apply the net proceeds for specific purposes, we may invest such net proceeds in short-term or marketable securities. RATIOS OF EARNINGS TO FIXED CHARGES The following are our unaudited consolidated ratios of earnings to fixed charges for each of the years in the five-year period ended December 31, 1998 and for the three months ended March 31, 1999:
THREE MONTHS ENDED YEAR ENDED DECEMBER 31, MARCH 31, -------------------------------------------- 1999 1998 1997 1996 1995 1994 ------------ ---- ---- ---- ---- ---- Ratio of earnings to fixed charges..... 6.2 2.6 3.9 6.8 8.4 11.3
4 6 DESCRIPTION OF DEBT SECURITIES The following is a general description of the terms of the debt securities that we may offer from time to time. The particular terms of the debt securities offered by any prospectus supplement and the extent, if any, to which the general provisions described below may apply will be described in the applicable prospectus supplement. The debt securities may be issued from time to time in one or more series. If the debt securities are "Senior Debt Securities," they will be issued under an Indenture (the "Senior Indenture"), between us and First National Bank of Chicago, as Trustee (the "Senior Trustee"). A copy of the Senior Indenture is filed as an exhibit to the registration statement of which this prospectus is a part. If the debt securities are "Subordinated Debt Securities," they will be issued under an Indenture (the "Subordinated Indenture"), between us and a trustee to be named prior to the offering of any Subordinated Debt Securities (the "Subordinated Trustee"). A copy of the form of Subordinated Indenture is filed as an exhibit to the registration statement of which this prospectus is a part. The Senior Trustee and the Subordinated Trustee are referred to herein individually as the "Trustee" and collectively as the "Trustees," and the Senior Indenture and the Subordinated Indenture are referred to herein individually as an "Indenture" and, collectively, as the "Indentures." You should read these documents carefully to fully understand the terms of the debt securities. As used in this "Description of Debt Securities," the "we," us," "our," "Great Lakes" or the "Company" refers to Great Lakes Chemical Corporation, and not to any of its subsidiaries, unless explicitly indicated by the context. Because the following is only a summary of certain provisions of the debt securities and the Indentures, it does not contain all information that you may find useful. For further information about the debt securities and the Indentures, you should read the Indentures. The Indentures are substantially identical, except for certain of our covenants and provisions relating to subordination. Capitalized terms used but not defined herein shall have the meanings assigned to them in the Indentures. GENERAL The Indentures do not limit the amount of debt securities that we can issue. The Indentures provide that we can issue debt securities from time to time, in one or more series, up to the aggregate amount which our board of directors may authorize. The Indentures do not limit the amount of other Indebtedness or securities, other than certain secured Indebtedness as described below, which we may issue. All Senior Debt Securities will be unsecured and will rank equally with all our other unsecured and unsubordinated indebtedness. All Subordinated Debt Securities will be unsecured and will be subordinated in right of payment to our Senior Indebtedness (which term includes the Senior Debt Securities) as described below under "Provisions Applicable Solely to Subordinated Debt Securities -- Subordination." A substantial portion of our operations are conducted through our Subsidiaries. Creditors of our Subsidiaries are entitled to a claim on the assets of those Subsidiaries. Consequently, in the event of a liquidation or reorganization of any Subsidiary, creditors of that Subsidiary are likely to be paid in full before any distribution is made to us or you, except to the extent that we are recognized as a creditor of such Subsidiary. If we are recognized as a creditor, our claims would still be effectively subordinated to any security interests in the assets of such Subsidiary and any Indebtedness of such Subsidiary senior to that held by us. The debt securities will be obligations exclusively of the Company. Since our operations are partially conducted through subsidiaries, primarily overseas, our cash flow and therefore our ability to service debt, including the debt securities offered by this prospectus, are partially dependent upon the earnings of our subsidiaries and the distribution of those earnings to, or upon loans or other payments of funds by those subsidiaries to, us. The subsidiaries are separate and distinct legal entities and have no obligation to pay any amounts due pursuant to the debt securities or to make any funds available 5 7 to us to repay its obligations, whether by dividends, loans or other payments. In addition, the payment of dividends and the making of loans and advances us by our subsidiaries may be subject to statutory or contractual restrictions, are contingent upon the earnings of those subsidiaries and are subject to various business considerations. Any right to receive assets of any of our subsidiaries upon their liquidation or reorganization and therefore your right to participate in those assets will be effectively subordinated to the claims of that subsidiary's creditors, including trade creditors. TERMS We will prepare a prospectus supplement for each series of debt securities that we issue. Each prospectus supplement will set forth the applicable terms of the debt securities to which it relates, which may include the following: (1) the title of the securities; (2) any limit on the amount of the securities; (3) the percentage of principal amount at which such securities may be offered; (4) the maturity; (5) the interest rate or rates; (6) the date from which interest will accrue; (7) the interest payment dates; (8) the record dates for determination of the holders to whom interest is payable; (9) any terms for redemption or for sinking fund payments; (10) the currency or currencies or units in which the securities are issuable and payable; (11) any conversion features; (12) whether the offered securities will be represented by one or more global securities, and if so, the method of transferring beneficial interests; (13) whether and under what circumstances we will pay Additional Amounts; and (14) any other terms or conditions not inconsistent with the Indentures. Unless otherwise provided in the prospectus supplement relating to any offered debt securities, principal, interest and Additional Amounts, if any, will be payable, and the debt securities will be transferable or, if applicable, convertible, at the office or agency maintained by us for such purposes; provided that payment of interest on registered debt securities may be made by check mailed to the persons entitled thereto at the addresses of such persons appearing on the security register. In the case of registered debt securities, interest on such debt securities will be payable on any interest payment date to the persons in whose name the debt securities are registered at the close of business on the record date with respect to such interest payment date. Unless otherwise specified in the applicable prospectus supplement, debt securities will be issued only in fully registered form without coupons in denominations of $1,000 and any integral multiple thereof. The debt securities may be represented by one or more global securities registered in the name of a depository or its nominee and, if so represented, interests in such global security will be shown on, and transfers thereof will be effected only through, records maintained by the designated depository and its participants as described below. Where debt securities of any series are issued in bearer form, the special restrictions and considerations, including special offering restrictions and 6 8 special Federal income tax considerations, applicable to any such debt securities and to payment on and transfer and exchange of such debt securities will be described in the applicable prospectus supplement. We may issue some of the debt securities as discounted debt securities (bearing no interest or bearing interest at a rate which at the time of issuance is below market rates) to be sold at a substantial discount below their stated principal amount ("Original Issue Discount Securities"). Federal income tax consequences and other special considerations applicable to any such Original Issue Discount Securities will be described in the applicable prospectus supplement. If the purchase price of any debt securities is payable in one or more foreign currencies or currency units or if any debt securities are denominated in one or more foreign currencies or currency units or if the principal of or interest, if any, on any debt securities is payable in one or more foreign currencies or currency units, the restrictions, elections, certain Federal income tax considerations, specific terms and other information with respect to such issue of debt securities and such foreign currency or currency units will be set forth in the applicable prospectus supplement. Debt securities may be presented for exchange, and registered debt securities may be presented for transfer, in the manner, at the places or subject to the restrictions set forth in the applicable Indenture, the debt securities and the applicable prospectus supplement. Debt securities in bearer form and the coupons, if any, attached thereto will be transferable by delivery. No service charge will be made for any transfer or exchange of debt securities, but we may require payment of a sum sufficient to cover any tax or other governmental change payable in connection therewith. The Indentures require us to file with the Trustees, on an annual basis, a certificate as to compliance with specified covenants contained in the Indentures. We will comply with Section 14(e) under the Securities Exchange Act of 1934, and any other tender offer rules which may then be applicable, in connection with any obligation of ours to purchase offered debt securities at the option of the holders thereof. Any such obligation applicable to a series of debt securities will be described in the applicable prospectus supplement. Unless otherwise described in a prospectus supplement relating to any offered debt securities, other than as described below under "-- Limitation on Liens," the Indentures do not contain any provisions that would limit our ability to incur indebtedness or that would afford holders of debt securities protection in the event of a sudden and significant decline in our credit quality or a takeover, recapitalization or highly leveraged or similar transaction in which we are involved. Accordingly, we could in the future enter into transactions that could increase the amount of indebtedness outstanding or otherwise affect our capital structure or credit rating. You should refer to the applicable prospectus supplement relating to any debt securities for information with respect to any deletions from, modifications of or additions to the Events of Default described below or our covenants contained in the Indentures, including any addition of a covenant or other provision providing event risk or similar protection. GLOBAL SECURITIES We may issue debt securities as "global securities" that will be deposited with a depository identified in the applicable prospectus supplement. The depository may also act through a nominee. Global securities may be issued in fully registered or bearer form and may be issued in either temporary or permanent form. The specific terms of the depository arrangements for a series of debt securities will be described in the applicable prospectus supplement. We anticipate that the following provisions will generally apply to depository arrangements. Upon the issuance of a global security and the deposit of such global security with or on behalf of the depository of such global security, the depository will credit on its book-entry registration and 7 9 transfer system the principal amounts of the individual debt securities represented by such global security to the accounts of persons that have accounts with such depository ("Participants"). The accounts to be credited will be designated by the underwriters or agents of such debt securities or, if such debt securities are offered and sold directly by us, by us. Ownership of beneficial interests in a global security will be limited to Participants or persons that may hold interests through Participants. Ownership of beneficial interests in such global security will be shown on, and the transfer of those ownership interests will be effected only through, records maintained by the depository (with respect to interests of Participants) and records of Participants (with respect to interests of persons who hold through Participants). The laws of some states require that certain purchasers of securities take physical delivery of such securities in definitive form. Such limits and such laws may impair the ability to own, pledge or transfer beneficial interest in a global security. So long as the depository is the registered owner of a global security, the depository will be considered the sole owner or holder of the debt securities represented by such global security for all purposes under the applicable Indenture. Except as provided below or in the applicable prospectus supplement, owners of beneficial interests in a global security will not be entitled to have any of the individual debt securities registered in their names, will not receive or be entitled to receive physical delivery of any such debt securities in definitive form and will not be considered the owners or holders thereof under the applicable Indenture. Payments of principal of and any interest (and premium, if any) on individual debt securities represented by a global security will be made to the depository as the registered owner of such global security. The depository will have sole responsibility and liability with respect to passing such payments along to beneficial holders and for maintaining, supervising or reviewing records relating to beneficial ownership of the debt securities. We understand that under existing industry practices, if we request any action of holders or an owner of a beneficial interest in a global security desires to give notice to take any action a holder is entitled to give or take under the applicable Indenture, the depositary would authorize the Participants to give such notice or take such action, and Participants would authorize beneficial owners owning through such Participants to give such notice or take such action or would otherwise act upon the instructions of beneficial owners owning through them. We expect that the depository, upon receipt of any payment in respect of a global security, will immediately credit Participants' accounts for their pro rata share of such payments. We also expect that payments by Participants to beneficial owners will be governed by standing instructions and customary practices, as is now the case with securities held for the accounts of customers in bearer form or registered in "street name." Such payments will be the responsibility of such Participants. If the depository is at any time unwilling, unable or ineligible to continue as depository and a successor depository is not appointed by us within 90 days, we will issue individual debt securities to Participants in exchange for the global security. In addition, we may, at any time and in our sole discretion, subject to any limitations described in the applicable prospectus supplement, redeem the global securities and issue individual debt securities to Participants in exchange for such global security. Principal of and any premium and interest on a global security will be payable in a manner described in the applicable prospectus supplement. CERTAIN COVENANTS LIMITATION ON LIENS The Senior Indenture provides that we will not, and will not permit any of our Restricted Subsidiaries to, create, incur or otherwise cause or suffer to exist or become effective any Liens of 8 10 any kind upon any Principal Property or any shares of stock or indebtedness of any Restricted Subsidiary now owned or hereafter acquired, unless all payments due under the Senior Indenture and the Senior Debt Securities are secured on an equal basis with the obligation so secured until such time as such obligation is no longer secured by a Lien. Permitted Liens are excepted from this limitation. See also "-- Exempted Indebtedness" below. The Subordinated Indenture provides that we will not, and will not permit any of our Restricted Subsidiaries to, create, incur, or otherwise cause or suffer to exist or become effective any Liens of any kind upon any Principal Property or any shares of stock or indebtedness of any Restricted Subsidiary (whether such Principal Property, shares of stock or indebtedness are now owned or hereafter acquired) that secures any Indebtedness that is equal in right of payment with the Subordinated Debt Securities unless all payments due under the Subordinated Indenture and the Subordinated Debt Securities are secured on an equal basis with the obligation so secured until such time as such obligation is no longer secured by a Lien. Permitted Liens are excepted from this limitation. See also "-- Exempted Indebtedness" below. LIMITATIONS ON SALE AND LEASEBACK TRANSACTIONS The Indentures provide that neither we nor any Restricted Subsidiary will enter into any sale and leaseback transaction with third parties with respect to any Principal Property (except for temporary leases of a term, including renewals, not exceeding five years) unless either (a) we or such Restricted Subsidiary would be entitled, under the provisions of the Indentures, to incur Indebtedness secured by a Lien on such property to be leased without equally and ratably securing the debt securities, or (b) we, within 180 days after the effective date of such transaction, apply to the voluntary retirement of our Funded Debt an amount equal to the value of such transaction, defined as the greater of the net proceeds of the sale of the property leased in such transaction or the fair value, as determined by the Board of Directors, of the leased property at the time such transaction was entered into. The Indentures define "Funded Debt" as indebtedness (including the debt securities) maturing by the terms thereof more than one year after the original creation thereof. See also "-- Exempted Indebtedness" below. EXEMPTED INDEBTEDNESS Notwithstanding the foregoing limitations on Liens and sale and leaseback transactions, we (and our Restricted Subsidiaries) may issue, assume, suffer to exist or guarantee Indebtedness secured by a Lien without securing the debt securities, or may enter into sale and leaseback transactions without retiring Funded Debt, or enter into a combination of such transactions, if the sum of the principal amount of all such Indebtedness and the aggregate value of all such sale and leaseback transactions does not at any such time exceed 10% of our and our Subsidiaries' consolidated total assets as shown in the latest audited consolidated balance sheet contained in the latest annual report to our stockholders. CONVERSION The Indentures contain certain provisions regarding the conversion of debt securities into common stock (or cash in lieu thereof). The specific terms applicable to a series of convertible debt securities, including the initial conversion price or conversion rate, any adjustments to such conversion price or conversion rate and the conversion period, and the conditions upon which such conversion will be effected will be set forth in the applicable prospectus supplement. 9 11 EVENTS OF DEFAULT The following are Events of Default under the Indentures with respect to any debt securities of any series: (i) failure to pay any installment of interest on or any Additional Amounts with respect to any debt security, continued for 30 days; (ii) failure to pay principal of (or premium, if any on) any debt security, either at maturity, upon any redemption or otherwise; (iii) failure by us to perform or observe certain other covenants, conditions or agreements contained in debt securities or in the applicable Indenture, continued for a period of 90 days after due notice is given as provided in the applicable Indenture; or (iv) certain events of bankruptcy, insolvency or reorganization. Additional Events of Default may be added for the benefit of holders of debt securities of a series. The Indentures provide that the Trustee shall notify the holders of debt securities of each series of any continuing default known to the Trustee which has occurred with respect to that series within 90 days after the occurrence thereof. The Indentures provide that, notwithstanding the foregoing, except in the case of default in the payment of the principal of, interest on or any Additional Amounts payable in respect of any of the debt securities of such series, the Trustee may withhold such notice if the Trustee in good faith determines that the withholding of such notice is in the interests of the holders of debt securities of such series. If an Event of Default of the type described in clause (iv) above has happened and is continuing, then the principal of (or, with respect to a series of Original Issue Discount Securities, such portion of the principal amount as may be specified in the terms of such series), accrued and unpaid interest on, and any Additional Amounts payable in respect of the debt securities will become immediately due and payable. If one or more Events of Default of the type described in clauses (i) through (iii) with respect to any series of debt securities at the time outstanding has happened and is continuing, then either (x) the Trustee or (y) the holders of not less than 25% of the principal amount of that series of the debt securities then outstanding may declare the principal (or, with respect to a series of Original Issue Discount Securities, such portion of the principal amount as may be specified in the terms of such series), accrued and unpaid interest on and any Additional Amounts payable in respect of the debt securities of that series due and payable immediately. This provision is subject to the condition that if, after any declaration of acceleration and before Stated Maturity of the principal with respect to the debt securities of such series, all arrears of interest and any Additional Amounts and the expenses of the Trustee, its agents or attorneys shall be paid by us or for our accounts, and all Defaults (other than the payment of principal that has been declared due and payable) have been cured to the satisfaction of the Trustee, then the Trustee shall, upon the written request of the holders of a majority in principal amount of the debt securities of the applicable series, waive such Default and rescind or annul the declaration of acceleration; provided that no such waiver, rescission or annulment shall extend to or affect any subsequent Default or impair any right consequent thereon. No holder of any debt security of any series will have the right to pursue a remedy under the applicable Indenture or the debt securities, unless (1) such holder gives the Trustee notice of a continuing Default with respect to the debt securities of that series, (2) the holders of at least a majority in principal amount of the debt securities of the applicable series make a request to the Trustee to pursue the remedy, (3) such holder or holders offered the Trustee security or indemnity satisfactory to the Trustee against any loss, liability or expense and (4) the Trustee does not comply with the request within 30 days after the receipt of the request and the offer of security or indemnity. 10 12 However, nothing contained in the Indentures shall affect or impair the right of any holder of debt securities to institute suit to enforce payment of the principal of, interest on and any Additional Amounts payable in respect of such holder's debt securities on or after the due dates expressed in such debt securities. We will be required to furnish to the Trustee a statement, detailing any Defaults of which we are aware, within five days after the occurrence of any such Default. REPORTS The Indentures provide that we will file with the Trustee copies of the annual reports and other information, documents and reports which we are required to file with the SEC under the Securities Exchange Act of 1934. If we are not required to file such reports and other information, the Indentures provide that we shall file with the Trustee and cause to be mailed to the holders of debt securities (i) annual reports containing the information required to be contained in an Annual Report on Form 10-K, (ii) quarterly reports containing the information required to be contained in a Quarterly Report on Form 10-Q and (iii) promptly after the occurrence of an event required to be therein reported, such other reports containing information required to be contained in a Current Report on Form 8-K. We shall also comply with the requirements of Section 314(a) of the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"). SUCCESSOR COMPANY The Indentures provide that we will not consolidate or merge with or into, or sell, lease, convey or otherwise dispose of all or substantially all of our assets or assign any of our obligations under the debt securities or applicable Indenture, unless (i) the entity formed by or surviving any such consolidation or merger (if other than us), or to which such sale, lease, conveyance or other disposition or assignment shall have been made (the "Surviving Entity"), is a corporation organized and existing under the laws of the United States, any state thereof, or the District of Columbia; (ii) the Surviving Entity assumes, by a supplemental Indenture in a form satisfactory to the Trustee, all of our obligations under the debt securities and the applicable Indenture; and (iii) immediately after giving effect to such transaction, no Default or Event of Default has occurred and is continuing. With respect to the sale of assets, the phrase "all or substantially all" as used in the Indentures varies according to the facts and circumstances of the subject transaction, has no clearly established meaning under New York law (which governs the Indentures) and is subject to judicial interpretation. Accordingly, in certain circumstances there may be a degree of uncertainty in ascertaining whether a particular transaction would involve a disposition of "all or substantially all" of the assets of a person, and therefore it may be unclear as to whether a disposition of assets comes within the terms of this provision. DISCHARGE Each Indenture provides that it will cease to be of further effect (except that certain obligations will survive) with respect to a series of debt securities when all outstanding debt securities of such series authenticated and issued have been delivered (other than destroyed, lost or stolen debt securities that have been replaced or paid) to the Trustee for cancellation and we have paid all sums payable under such Indenture. MODIFICATION OF THE INDENTURES Each Indenture contains provisions permitting us and the Trustee, with the consent of the holders of not less than a majority in aggregate principal amount of the debt securities of each series at the time outstanding under such Indenture, to enter into supplemental indentures to amend any of 11 13 the provisions of each Indenture or any supplemental indenture with respect to the debt securities of such series; provided that, unless consented to by each holder of debt securities of such series, no such supplemental indenture may: (a) reduce the amount of debt securities whose holders must consent to an amendment or a waiver; (b) reduce the rate of or change the time for payment of interest or Additional Amounts, including default interest on any debt security; (c) reduce the principal of or change the Stated Maturity of any debt security or alter the provisions with respect to redemption; (d) make any debt security payable in money other than that stated in the debt security; (e) make any change in the types of amendment that need the approval of every affected holder of debt securities; (f) with respect to the Senior Indenture, affect the ranking of the Senior Debt Securities; or (g) waive a Default in the payment of principal of, any Additional Amounts payable in respect of or interest on, or with respect to, any debt security. We and the Trustee may enter into supplemental indentures which amend the applicable Indenture and the debt securities with respect to a particular series without the consent of any holder of debt securities of such series in order to: (a) cure any ambiguity, omission, defect or inconsistency; (b) comply with such Indenture concerning the substitution of successor corporations pursuant to a merger or consolidation; (c) comply with any requirements of the SEC in connection with the qualification of such Indenture under the Trust Indenture Act; (d) provide for uncertificated securities; (e) make any change that does not materially adversely affect the legal rights of any holder of debt securities under the applicable Indenture as then in effect; (f) secure the debt securities and make intercreditor arrangements with respect to any such debt securities (unless prohibited by such Indenture); (g) provide for a replacement Trustee; (h) add to our covenants and agreements for the benefit of all the holders of all of the debt securities with respect to a series and surrender any right or power reserved for us in such Indenture; or (i) add to, change or eliminate any of the provisions of the Indenture in respect of one or more series of debt securities, so long as any such addition, change or elimination (i) does not (A) apply to any debt security of any series created prior to the execution of such supplemental indenture and entitled to the benefit of such provision or (B) modify the rights of the holder of any such debt security with respect to such provision or (ii) becomes effective only when there are no debt securities outstanding under the Indenture. 12 14 DEFEASANCE AND COVENANT DEFEASANCE Each Indenture provides that we may elect either: (a) to terminate (and be deemed to have satisfied) all our obligations with respect to such debt securities (except for the obligations to register transfers or exchanges of such debt securities, to replace mutilated, destroyed, lost or stolen debt securities, to maintain an office or agency in respect of the debt securities, to compensate and indemnify the Trustee and to punctually pay or cause to be paid the principal of, interest on and any Additional Amounts payable in respect of all debt securities of such series when due) ("defeasance"); or (b) to be released from our obligations with respect to certain covenants, including those described above under "Certain Covenants -- Limitation on Liens" and "-- Limitations on Sale and Leaseback Transactions" ("covenant defeasance"). In either case, we may be discharged from our obligations only if we deposit with the Trustee, in trust for such purpose, money and/or U.S. Government Obligations (as defined in the Indentures) which through the payment of principal and interest in accordance with their terms will provide money, in an amount sufficient (in the opinion of a nationally recognized firm of independent public accountants) to pay the principal of, interest on and any Additional Amounts payable in respect of the outstanding debt securities of such series, and any mandatory sinking fund or analogous payments thereon, on the scheduled due dates therefor. Such a trust may be established only if, among other things, we have delivered to the Trustee an opinion of counsel (as specified in such Indenture) with regard to certain matters, including an opinion to the effect that the holders of such debt securities will not recognize income, gain or loss for Federal income tax purposes as a result of such deposit and discharge and will be subject to Federal income on the same amounts and in the same manner and at the same times as would have been the case if such deposit and defeasance or covenant defeasance, as the case may be, had not occurred. The applicable prospectus supplement with respect to the debt securities of any series may further describe these or other provisions, if any, permitting defeasance or covenant defeasance. CONCERNING THE TRUSTEE The First National Bank of Chicago is the Trustee under the Senior Indenture. Prior to the issuance of any Subordinated Debt Securities under the Subordinated Indenture, we will engage a qualified trustee to serve as Trustee under the Subordinated Indenture. Such Trustee will be an "eligible trustee" under the Trust Indenture Act. PROVISIONS APPLICABLE SOLELY TO SUBORDINATED DEBT SECURITIES SUBORDINATION The Subordinated Debt Securities will be subordinate and junior in right of payment, to the extent set forth in the Subordinated Indenture, to all our Senior Indebtedness (as defined below). If we should default in the payment of any principal of, interest on or any Additional Amounts payable in respect of any Senior Indebtedness when the same becomes due and payable, whether at maturity or at a date fixed for prepayment or by declaration or otherwise, then, upon written notice of such default to us by the holders of such Senior Indebtedness or any Trustee therefor and subject to certain rights of ours to dispute such default and subject to proper notification of the Trustee, unless and until such default has been cured or waived or has ceased to exist, no direct or indirect payment (in cash, property, securities, by set-off or otherwise) will be made or agreed to be made for principal of, interest on or any Additional Amounts payable in respect of the Subordinated Debt Securities, or in respect of any redemption, retirement, purchase or other acquisition of the Subordinated Debt Securities other than those made in our capital stock (or cash in lieu of fractional shares thereof) 13 15 under any conversion right of the Subordinated Debt Securities or otherwise made in our capital stock. The term "Senior Indebtedness" is defined to mean our Indebtedness (including the Senior Debt Securities) outstanding at any time except: (a) any Indebtedness as to which, by the terms of the instrument creating or evidencing the same, it is provided that such Indebtedness is not senior in right of payment to the Subordinated Debt Securities; (b) the Subordinated Debt Securities; (c) any Indebtedness of ours to a wholly owned Subsidiary of ours; (d) interest accruing after the filing of a petition initiating certain events of bankruptcy or insolvency unless such interest is an allowed claim enforceable against us in a proceeding under federal or state bankruptcy laws; and (e) trade payables. If (i) without our consent a court shall enter an order for relief with respect to us under the United States federal bankruptcy laws or a judgment, order or decree adjudging us as bankrupt or insolvent, or enter an order for relief for reorganization, arrangement, adjustment or composition of or in respect of us under the United States federal or state bankruptcy or insolvency laws or (ii) we shall institute proceedings for the entry of an order for relief with respect to us under the United States federal bankruptcy laws or for an adjudication of insolvency, or shall consent to the institution of bankruptcy or insolvency proceedings against us, or shall file a petition seeking, or seek or consent to reorganization, arrangement, composition or similar relief under any applicable law, or shall consent to the filing of such petition or to the appointment of a receiver, custodian, liquidator, assignee, trustee, sequestrator or similar official in respect of us or of substantially all of our property, or we shall make a general assignment for the benefit of creditors, then all Senior Indebtedness (including any interest thereon accruing after the commencement of any such proceedings and any Additional Amounts payable in respect thereof) will first be paid in full before any payment or distribution, whether in cash, securities or other property, is made on account of the principal of, interest on or any Additional Amounts payable in respect of the Subordinated Debt Securities. In such event, any payment or distribution on account of the principal of, interest on or any Additional Amounts payable in respect of Subordinated Debt Securities, whether in cash, securities or other property (other than our securities or securities of any other corporation provided for by a plan or reorganization or readjustment the payment of which is subordinate, at least to the extent provided in the subordination provisions with respect to the Subordinated Debt Securities, to the payment of all Senior Indebtedness then outstanding and to any securities issued in respect thereof under any such plan of reorganization or readjustment), which would otherwise (but for the subordination provisions) be payable or deliverable in respect of the Subordinated Debt Securities, will be paid or delivered directly to the holders of Senior Indebtedness in accordance with the priorities then existing among such holders until all Senior Indebtedness (including any interest thereon accruing after the commencement of any such proceedings and any Additional Amounts payable in respect thereof) has been paid in full. In the event of any such proceeding, after payment in full of all sums owing with respect to Senior Indebtedness, the holders of Subordinated Debt Securities, together with the holders of any obligations of ours ranking on a parity with the Subordinated Debt Securities, will be entitled to be repaid from our remaining assets the amounts at that time due and owing on account of unpaid principal of, interest on and any Additional Amounts payable in respect of the Subordinated Debt Securities and such other obligations before any payment or other distribution, whether in cash, property or otherwise, shall be made on account of any of our capital stock or obligations ranking junior to the Subordinated Debt Securities and such other obligations. 14 16 If any payment or distribution on account of the principal of, interest on or any Additional Amounts payable in respect of the Subordinated Debt Securities of any character, whether in cash, securities or other property (other than our securities or securities of any other corporation provided for by a plan of reorganization or readjustment the payment of which is subordinate, at least to the extent provided in the subordination provisions with respect to the Subordinated Debt Securities, to the payment of all Senior Indebtedness then outstanding and to any securities issued in respect thereof under any such plan or reorganization or readjustment), shall be received by the Trustee or any holder of any Subordinated Debt Securities in contravention of any of the terms of the Subordinated Indenture and before all the Senior Indebtedness shall have been paid in full, such payment or distribution or security will be received in trust for the benefit of, and will be paid over or delivered and transferred to, the holders of the Senior Indebtedness then outstanding in accordance with the priorities then existing among such holders for application to the payment of all Senior Indebtedness remaining unpaid to the extent necessary to pay all such Senior Indebtedness remaining unpaid in full. By reason of such subordination, in the event of our insolvency, holders of Senior Indebtedness may receive more, ratably, than holders of the Subordinated Debt Securities. In addition, other creditors of ours who are not holders of Subordinated Debt Securities or holders of Senior Indebtedness may recover less, ratably, than holders of Senior Indebtedness and may recover more, ratably, than holders of Subordinated Debt Securities. Such subordination will not prevent the occurrence of an Event of Default or limit the right of acceleration in respect of the Subordinated Debt Securities. CERTAIN DEFINITIONS The following are certain key definitions used in this section. These and other definitions are contained in the Indentures. You should read the applicable Indenture to understand these sections fully. "Additional Amounts" shall mean any additional amounts which are required by a debt security, under circumstances specified therein, to be paid by us in respect of certain taxes imposed on certain holders of such debt securities, or as otherwise specified in the terms of such debt security, and which are owing to such holders. "Affiliate" shall mean, with respect to any Person, another Person directly or indirectly controlling or controlled by or under direct or indirect common control with such first Person. For the purposes of this definition, "control" (including, with correlative meanings, the terms "controlling," "controlled by" and "under common control with"), as applied to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of that Person, whether through the ownership of voting securities or by contract or otherwise. "Capitalized Lease Obligation" shall mean an obligation that is required to be classified and accounted for as a capitalized lease for financial reporting purposes in accordance with generally accepted accounting principles, and the amount of Indebtedness represented by such obligation shall be the capitalized amount of such obligation determined in accordance with such principles; and the Stated Maturity thereof shall be the date of the last payment of rent or any other amount due under such lease prior to the first date upon which such lease may be terminated by the lessee without payment of a penalty. "Consolidated Net Worth" shall mean the excess of (i) assets over (ii) liabilities of Great Lakes and its consolidated Subsidiaries and Minority Interests, as determined from time to time in accordance with generally accepted accounting principles. 15 17 "Default" shall mean any event that is, or after notice or passage of time or both would be, an Event of Default. "Indebtedness" shall mean, with respect to any Person, at any date, any of the following, without duplication: (i) any liability, contingent or otherwise, of such Person (A) for borrowed money (whether or not the recourse of the lender is to the whole of the assets of such Person or only to a portion thereof), (B) evidenced by a note, bond, debenture or similar instrument or (C) for the payment of money relating to a Capitalized Lease Obligation or other obligation (whether issued or assumed) relating to the deferred purchase price of property; (ii) all conditional sale obligations and all obligations under any title retention agreement (even if the rights and remedies of the seller under such agreement in the event of default are limited to repossession or sale of such property), but excluding trade accounts payable arising in the ordinary course of business; (iii) all obligations for the reimbursement of any obligor on any letter of credit, banker's acceptance or similar credit transaction other than entered into in the ordinary course of business; (iv) all indebtedness of others secured by (or for which the holder of such indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on any asset or property (including, without limitation, leasehold interests and any other tangible or intangible property) of such Person, whether or not such indebtedness is assumed by such Person or is not otherwise such Person's legal liability; provided, that if the obligations so secured have not been assumed in full by such Person or are otherwise not such Person's legal liability in full, the amount of such indebtedness for the purposes of this definition shall be limited to the lesser of the amount of such indebtedness secured by such Lien or the fair market value of the assets of the property securing such Lien; (v) all indebtedness of others (including all interest and dividends on any indebtedness or preferred stock of any other Person for the payment of which is) guaranteed, directly or indirectly, by such Person or that is otherwise its legal liability or which such Person has agreed to purchase or repurchase or in respect of which such Person has agreed contingently to supply or advance funds; and (vi) obligations in respect of Currency Agreements and Interest Swap Obligations. "Issue Date" shall mean the first date on which a debt security is authenticated by the Trustee under an Indenture. "Lien" shall mean any mortgage, pledge, security interest, encumbrance, lien, charge or adverse claim affecting title or resulting in an encumbrance against real or personal property or a security interest of any kind (including, without limitation, any conditional sale or other title retention agreement or lease in the nature thereof or any filing or agreement to file a financing statement as debtor under the Uniform Commercial Code or any similar statute other than to reflect ownership by a third party or property leased to us or any of our Subsidiaries under a lease that is not in the nature of a conditional sale or title retention agreement). "Minority Interest" is defined as any shares of stock of any class of a Subsidiary that are not owned by us or a Subsidiary of ours. "Permitted Liens" shall mean, with respect to any Person: (i) Liens existing on the Issue Date; (ii) Liens on property or assets of, or any shares of stock of or secured debt of, any corporation existing at the time such corporation becomes a Restricted Subsidiary of ours or at the time such corporation is merged into the Company or any of its Restricted Subsidiaries; (iii) Liens in favor us or any of our Restricted Subsidiaries; (iv) Liens in favor of governmental bodies to secure progress or advance payments; (v) Liens securing industrial revenue or pollution control bonds; (vi) Liens on Property to secure Indebtedness incurred for the purpose of (a) financing all or any part of the purchase price of such Property incurred prior to, at the time of, or within 180 days after, the acquisition of such Property or (b) financing all or any part of the cost of construction, improvement, development or expansion of any such Property incurred prior to, at the time of, or within 180 days after, such construction, improvement, development or expansion of such Property; (vii) statutory 16 18 liens or landlords', carriers', warehouseman's, mechanics', suppliers', materialmen's, repairmen's or other like Liens arising in the ordinary course of business and with respect to amounts not yet delinquent or being contested in good faith by appropriate proceedings, if a reserve or other appropriate provisions, if any, as shall be required in conformity with generally accepted accounting principles has been made therefor; (viii) Liens on current assets of Restricted Subsidiaries securing Indebtedness of such Restricted Subsidiaries; and (ix) any extensions, substitutions, replacements or renewals in whole or in part of a Lien (an "existing Lien") enumerated in clauses (i) through (viii) above; provided that the Lien may not extend beyond (A) the Property or Indebtedness subject to the existing Lien and (B) improvements and construction on such Property and the Indebtedness secured by the Lien may not exceed the Indebtedness secured at the time by the existing Lien. "Person" shall mean any individual, corporation, partnership, limited partnership, joint venture, association, joint-stock company, trust, unincorporated organization, government or any agency or political subdivision thereof, or any other entity. "Principal Property" shall mean any manufacturing plant or warehouse owned or leased by us or any Subsidiary, the gross book value of which exceeds one percent of Consolidated Net Worth, other than manufacturing plants and warehouses which the Board of Directors by resolution declares, together with all other plants and warehouses previously so declared, are not of material importance to the total business conducted by us and our Restricted Subsidiaries as an entirety. "Property" of any Person means all types of real, personal, tangible, intangible or mixed property owned by such Person whether or not included in the most recent consolidated balance sheet of such Person and its Subsidiaries under generally accepted accounting principles. "Restricted Subsidiary" shall mean any of our Subsidiaries that is not an Unrestricted Subsidiary. "Stated Maturity," when used with respect to any security or any installment of interest thereon, shall mean the date specified in such security as the fixed date on which the principal of such security or such installment of interest is due and payable. "Subsidiary" of any Person shall mean (i) any Person of which more than 50% of the total voting power of shares of capital stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by any Person or one or more of the Restricted Subsidiaries of that Person or a combination thereof, and (ii) any partnership, joint venture or other Person in which such Person or one or more of the Restricted Subsidiaries of that Person or a combination thereof has the power to control by contract or otherwise the board of directors or equivalent governing body or otherwise controls such entity. "Unrestricted Subsidiary" means (i) any of our Subsidiaries that at the time of determination shall be designated an Unrestricted Subsidiary by the our Board of Directors in the manner provided below and (ii) any Subsidiary of an Unrestricted Subsidiary. The Board of Directors may designate any of our Subsidiaries (including any newly-acquired or newly-formed Subsidiary) to be an Unrestricted Subsidiary unless such Subsidiary owns any capital stock of, or owns or holds any property of, ours or any of our other Subsidiaries that is not a Subsidiary of the Subsidiary so designated; provided, however, that the Subsidiary to be so designated has total assets of $5,000 or less. 17 19 DESCRIPTION OF DEBT WARRANTS We may issue, together with other securities or separately, warrants for the purchase of debt securities ("Debt Warrants"). The Debt Warrants are to be issued under Debt Warrant Agreements (each a "Debt Warrant Agreement") to be entered into between us and a bank or trust company, as Debt Warrant Agent (the "Debt Warrant Agent"), all as set forth in the applicable prospectus supplement. The Debt Warrant Agent will act solely as our agent in connection with the Debt Warrants of such series and will not assume any obligations or relationship of agency or trust for or with any holders or beneficial owners of Debt Warrants. A copy of the form of Debt Warrant Agreement, including the form of warrant certificates representing the Debt Warrants (the "Debt Warrant Certificates"), reflecting the alternative provisions to be included in the Debt Warrant Agreements that will be entered into with respect to particular offerings of Debt Warrants, will be filed in an amendment to the registration statement of which this prospectus is a part or filed in a Current Report on Form 8-K and incorporated by reference in the registration statement of which this prospectus is a part. Because the following is only a summary of the Debt Warrant Agreements and the Debt Warrant Certificates, it does not contain all of the information that you may find useful. For further information about the Debt Warrant Agreements and the Debt Warrant Certificates, you should read the Debt Warrant Agreements and the Debt Warrant Certificates. GENERAL You should look in the accompanying prospectus supplement for the following terms of the offered Debt Warrants: (a) the designation, aggregate principal amount and terms of the debt securities purchasable upon exercise of such Debt Warrants and the procedures and conditions relating to the exercise of such Debt Warrants; (b) the specific designation and terms of any related debt securities with which such Debt Warrants are issued and the number of such Debt Warrants issued with each such debt security; (c) the date, if any, on and after which such Debt Warrants and the related debt securities will be separately transferable; (d) the principal amount of debt securities purchasable upon exercise of each debt warrant and the price at which such principal amount of debt securities may be purchased upon such exercise; (e) the date on which the right to exercise such Debt Warrants shall commence and the date on which such right shall expire (the "Expiration Date"); (f) if the debt securities purchasable upon exercise of such Debt Warrants are original issue discount debt securities, a discussion of Federal income tax considerations applicable thereto; and (g) whether the Debt Warrants represented by the Debt Warrant Certificates will be issued in registered or bearer form, and, if registered, where they may be transferred and registered. Debt Warrant Certificates will be exchangeable for new Debt Warrant Certificates of different denominations and Debt Warrants may be exercised at the corporate trust office of the Debt Warrant Agent or any other office indicated in the prospectus supplement. Prior to the exercise of their Debt Warrants, holders of Debt Warrants will not have any of the rights of holders of the debt securities purchasable upon such exercise and will not be entitled to payments of principal of and premium or interest, if any, on the debt securities purchasable upon such exercise. 18 20 EXERCISE OF DEBT WARRANTS Each Debt Warrant will entitle the holder to purchase for cash such principal amount of debt securities at such exercise price as shall in each case be set forth in, or to be determinable as set forth in the applicable prospectus supplement. Debt Warrants may be exercised at any time up to the close of business on the Expiration Date set forth in the applicable prospectus supplement. After the close of business on the Expiration Date, unexercised Debt Warrants will become void. Debt Warrants may be exercised as set forth in the applicable prospectus supplement relating to such Debt Warrants. Upon receipt of payment and the Debt Warrant Certificate properly completed and duly executed at the corporate trust office of the Debt Warrant Agent or any other office indicated in the applicable prospectus supplement, we will, as soon as practicable, forward the debt securities purchasable upon such exercise. If less than all of the Debt Warrants represented by such Debt Warrant Certificate are exercised, a new Debt Warrant Certificate will be issued for the remaining amount of Debt Warrants. DESCRIPTION OF COMMON STOCK AND RIGHTS We may issue, separately or together with or upon conversion of or exchange for other securities common stock, $1.00 par value ("Common Stock"), and associated stock purchase rights ("Rights"), all as set forth in the applicable prospectus supplement. The following summaries do not purport to be complete and are subject to, and are qualified in their entirety by reference to, the following documents: (i) our Certificate of Incorporation (the "Certificate"); (ii) our By-Laws (the "By-Laws"); and (iii) our Rights Plan, dated February 15, 1999, as may subsequently be amended (the "Rights Agreement"), between us and Harris Trust Company of New York, as Rights Agent, pursuant to which the Rights are issued. A copy of each of the Certificate, By-Laws and the Rights Agreement are incorporated by reference as exhibits. See "Where You Can Find More Information." COMMON STOCK The authorized capital stock of the Company consists of 200,000,000 shares of Common Stock. Dividend Rights. Each share of Common Stock ranks equally with every other share of Common Stock with respect to dividends and distributions. Dividends may be declared by the Board of Directors and paid by the Company at such times as the Board of Directors may determine, under the provisions of the Delaware General Corporation Act. Voting Rights. Each holder of Common Stock is entitled to one vote per share of such stock held by him of record. Holders of Common Stock do not have cumulative voting rights. Holders of Common Stock are entitled to vote on all matters requiring shareholder approval under the Delaware General Corporation Act and the Certificate and By-Laws, and to elect the members of the Board of Directors. Directors are divided into three classes, each of which has, as nearly as possible, the same number of directors. At each annual meeting of the shareholders, the directors elected to succeed those whose terms have then expired are designated as being of the same class as the directors they succeed and (subject to removal) hold office for a three-year term expiring at the third succeeding annual meeting of the shareholders. 19 21 Liquidation Rights. On liquidation, holders of Common Stock are entitled to receive all assets which remain after satisfaction of all of our liabilities and obligations. Each share of Common Stock ranks equally with every other share of Common Stock with respect to liquidating distributions. Preemptive and Other Rights and Obligations. Holders of Common Stock are not entitled to preemptive rights, conversion rights or redemption rights and have no liability for further calls or assessments by or on behalf of the Company. RIGHTS PLAN On February 15, 1999, our Board of Directors declared a dividend distribution of one Right for each outstanding share of Common Stock to stockholders of record at the close of business on April 1, 1999 (the "Record Date") and has authorized the issuance of one Right for each share of Common Stock issued between the Record Date and the Distribution Date. Each Right entitles the registered holder to purchase one share of Common Stock from us at a purchase price of $170.00, subject to adjustment in certain circumstances. The description and terms of the Rights are set forth in the Rights Agreement. Initially, the Rights will be attached to the certificates representing outstanding shares of Common Stock, and no separate Rights Certificates evidencing the Rights will be distributed. Until such time as separate Rights Certificates are issued, the Rights will be transferable only in connection with the transfer of the underlying shares of Common Stock. The Rights will separate from the Common Stock and a Distribution Date will occur upon the earliest to occur of (i) ten (10) days following a public announcement that a person or group of affiliated or associated persons (an "Acquiring Person") has acquired beneficial ownership of 15% or more of the outstanding shares of Common Stock (the date of such announcement being the "Stock Acquisition Date"), (ii) ten (10) business days following the commencement of a tender offer or exchange offer that would result in a person or group beneficially owning 15% or more of the outstanding shares of Common Stock or (iii) the tenth business day after the Board of Directors determines that a person or group who has acquired 10% or more of the Common Stock of the Company intends to cause the Company to repurchase such shares or to pressure the Company to take action that is not in the best interests of the Company or is reasonably likely to cause a material adverse impact on the Company (an "Adverse Person"). Until the Distribution Date, the surrender for transfer of any certificate for Common Stock will also constitute the transfer of the Rights associated with the Common Stock represented by such certificate. The Rights are not exercisable until the Distribution Date and will expire at the close of business on February 15, 2009, unless earlier redeemed by the Company as described below. As soon as practicable after the Distribution Date, Rights Certificates will be mailed to holders of record of the Common Stock as of the close of business on the Distribution Date and, thereafter, such separate Rights Certificates alone will represent the Rights. All shares of Common Stock issued prior to the Distribution Date will be issued with Rights. Shares of Common Stock issued after the Distribution Date will be issued with Rights if such shares are issued pursuant to the exercise of stock options or under an employee benefit plan, granted or awarded as of the Distribution Date, or upon the exercise, conversion or exchange of securities issued after adoption of the Rights Agreement. However, no additional rights will be issued if such issuance would create a significant risk of a material adverse tax consequence to the Company or if some other appropriate adjustment has been made in lieu of the issuance. Except as otherwise determined by the Board of Directors, no other shares of Common Stock issued after the Distribution Date will be issued with Rights. 20 22 In the event that (i) a Person becomes the beneficial owner of more than 15% of the then outstanding shares of Common Stock (except pursuant to an offer for all outstanding shares of Common Stock at a price and on terms which a majority of the independent directors of the Company determines to be fair to, and otherwise in the best interests of, the stockholders) or (ii) Board of Directors determines that a person who has acquired 10% or more of the Common Stock of the Company is an Adverse Person, at any time following the Distribution Date, each holder of a Right will thereafter have the right to receive, upon exercise, a number of shares of Common Stock having a value equal to twice the Right's Purchase Price. Notwithstanding any of the foregoing, following the occurrence of any of the events specified in this paragraph, all Rights that are, or (under certain circumstances specified in the Rights Agreement) were, beneficially owned by any Acquiring Person or Adverse Person will be null and void. However, Rights are not exercisable following the occurrence of any of the events set forth above until such time as the Rights are no longer redeemable by the Company as set forth below. In the event that following the Stock Acquisition Date, (i) the Company is acquired in a merger or consolidation in which the Company is not the surviving corporation (other than a merger described in the preceding paragraph or a merger that follows a tender offer determined to be fair to the stockholders of the Company, as described in the preceding paragraph), (ii) in connection with a merger in which the Company is the surviving corporation and in which all or part of the Common Stock is exchanged for other securities, cash or property, or (iii) 50% or more of the Company's assets or earning power is sold or transferred, each holder of a Right shall thereafter have the right to receive, upon exercise of the Right, common stock of the acquiring company having a value equal to two times the Exercise Price of the Right. The Exercise Price is the Purchase Price multiplied by the number of shares of Common Stock issuable upon exercise of a Right prior to the events described in this paragraph (initially, one). The events set forth in this paragraph and in the preceding paragraph are collectively referred to as the "Triggering Events." The Purchase Price payable, and the number of shares of Common Stock issuable, upon exercise of the Rights are subject to adjustment from time to time (i) to prevent dilution in the event of a stock dividend on, or a subdivision, combination or reclassification of, the Common Stock, (ii) if holders of the Common Stock are granted certain rights or warrants to subscribe for Common Stock or securities convertible into Common Stock at less than the current market price of the Common Stock, or (iii) upon the distribution to holders of the Common Stock of evidences of indebtedness or assets (excluding regular quarterly cash dividends) or of subscription rights or warrants (other than those referred to above). With certain exceptions, no adjustment in the Purchase Price will be required until cumulative adjustments amount to at least 1% of the Purchase Price. No fractional shares of Common Stock will be issued upon exercise of the Rights and, in lieu thereof, a cash payment will be made based on the market price of the Common Stock on the last trading date prior to the date of exercise. As long as no Adverse Person has been identified by the Board of Directors, at any time until the earlier of (i) the close of business on February 15, 2009 and (ii) fifteen days following the Stock Acquisition Date, the Company may redeem the Rights in whole, but not in part, at a price of $.01 per Right, payable, at the election of the Company, in cash or shares of Common Stock. Until a Right is exercised, the holder thereof, as such, will have no rights as a stockholder of the Company, including, without limitation, the right to vote or to receive dividends. While the distribution of the Rights will not be taxable to stockholders or to the Company, stockholders may, depending upon the circumstances, recognize taxable income in the event that the Rights become exercisable for Common Stock (or other consideration) of the Company or for common stock of an acquiring company. 21 23 Any of the provisions of the Rights Agreement may be amended by the Board of Directors of the Company prior to the Distribution Date. After the Distribution Date, the provisions of the Rights Agreement may be amended by the Board to cure any ambiguity, defect or inconsistency, to make changes which do not adversely affect the interests of holders of Rights (excluding the interests of any Acquiring Person), or to shorten or lengthen any time period under the Rights Agreement; provided that no amendment to adjust the time period governing redemption shall be made at such time as the Rights are not redeemable. A copy of the Rights Agreement has been filed with the SEC as an Exhibit to a Registration Statement of the Company on Form 8-A. A copy of the Rights Agreement is available free of charge from the Company upon written request therefor. This summary description of the Rights does not purport to be complete and is qualified in its entirety by reference to the Rights Agreement, which is incorporated herein by reference. DESCRIPTION OF STOCK WARRANTS We may issue, together with other securities or separately, stock warrants for the purchase of Common Stock ("Stock Warrants"). The Stock Warrants are to be issued under stock warrant agreements (each a "Stock Warrant Agreement") to be entered into between us and a bank or trust company, as stock warrant agent (the "Stock Warrant Agent"), all as set forth in the applicable prospectus supplement. The Stock Warrant Agent will act solely as our agent in connection with the Stock Warrants of such series and will not assume any obligations or relationship of agency or trust for or with any holders or beneficial owners of Stock Warrants. Copies of the forms of Stock Warrant Agreements and the forms of warrant certificates (the "Stock Warrant Certificates") will be filed in an amendment to the registration statement of which this prospectus is a part or filed in a Current Report on Form 8-K and incorporated by reference in the registration statement of which this prospectus is a part. The following description of certain provisions of the forms of Stock Warrant Agreements and Stock Warrant Certificates does not purport to be complete and is subject to, and are qualified in their entirety by reference to, all the provisions of the Stock Warrant Agreements and the Stock Warrant Certificates to be filed in an amendment to the registration statement of which this prospectus is a part or filed in a Current Report on Form 8-K and incorporated by reference in the registration statement of which this prospectus is a part. GENERAL If we offer warrants for the purchase of Common Stock, the applicable prospectus supplement will describe their terms, which may include the following: (i) the offering price of such Stock Warrants, if any; (ii) the procedures and conditions relating to the exercise of such Stock Warrants; (iii) the number of shares of Common Stock purchasable upon exercise of each stock warrant and the initial price at which such shares may be purchased upon exercise; (iv) the date on which the right to exercise such Stock Warrants shall commence and the date on which such right shall expire (the "Expiration Date"); (v) a discussion of Federal income tax considerations applicable to the exercise of Stock Warrants; (vi) call provisions of such Stock Warrants, if any; and (vii) any other terms of the Stock Warrants. 22 24 The shares of Common Stock issuable upon the exercise of the Stock Warrants will, when issued in accordance with the Stock Warrant Agreement, be fully paid and nonassessable. Prior to the exercise of their Stock Warrants, holders of Stock Warrants will not have any of the rights of holders of the Common Stock purchasable upon such exercise, and will not be entitled to any dividend payments on the Common Stock purchasable upon such exercise. EXERCISE OF WARRANTS Each Stock Warrant will entitle the holder to purchase for cash such number of shares of Common Stock at such exercise price as shall in each case be set forth in, or be determinable as set forth in, the applicable prospectus supplement. Unless otherwise specified in the applicable prospectus supplement, Stock Warrants may be exercised at any time up to the close of business on the Expiration Date set forth in the applicable prospectus supplement. After the close of business on the Expiration Date, unexercised Stock Warrants will become void. Stock Warrants may be exercised as set forth in the applicable prospectus supplement. Upon receipt of payment and the Stock Warrant Certificates properly completed and duly executed at the corporate trust office of the Stock Warrant Agent or any other office indicated in the prospectus supplement, we will, as soon as practicable, forward a certificate representing the number of shares of Common Stock purchasable upon such exercise. If less than all of the Stock Warrants represented by such Stock Warrant Certificate are exercised, a new Stock Warrant Certificate will be issued for the remaining amount of Stock Warrants. ANTI-DILUTION PROVISIONS Unless otherwise specified in the applicable prospectus supplement, the exercise price payable and the number of shares purchasable upon the exercise of each stock warrant will be subject to adjustment in certain events, including: (i) the issuance of a stock dividend to holders of Common Stock or a combination, subdivision or reclassification of Common Stock; (ii) the issuance of rights, warrants or options to all holders of Common Stock entitling the holders thereof to purchase Common Stock for an aggregate consideration per share less than the current market price per share of the Common Stock; or (iii) any distribution by us to the holders of our Common Stock of evidences of our indebtedness or of assets (excluding cash dividends or distributions payable out of capital surplus and dividends and distributions referred to in (i) above). No fractional shares will be issued upon exercise of Stock Warrants, but we will pay the cash value of any fractional shares otherwise issuable. DESCRIPTION OF CURRENCY WARRANTS We may issue, together with debt securities or Debt Warrants or separately, currency warrants which either: (i) entitle the holders thereof to receive from us the Cash Settlement Value in U.S. dollars of the right to sell a specified amount of a specified foreign currency or currency units for a specified amount of U.S. dollars (each, a "Currency Put Warrant") or (ii) entitle the holders thereof to receive from us the Cash Settlement Value in U.S. dollars of the right to purchase a specified amount of a specified foreign currency or currency units for a specified amount of U.S. dollars (each, a "Currency Call Warrant"). The spot exchange rate of the applicable Base Currency, upon exercise, as compared to the U.S. dollar, will determine whether the currency warrants have a Cash Settlement Value on any given day prior to their expiration. 23 25 The currency warrants are to be issued under a currency warrant agreement (each a "Currency Warrant Agreement") to be entered into between us and a bank or trust company, as agent (the "Currency Warrant Agent"), all as set forth in the applicable prospectus supplement. The Currency Warrant Agent will act solely as our agent in connection with the currency warrants of such series and will not assume any obligations or relationship of agency or trust for or with any warrant holders. Copies of the forms of Currency Warrant Agreements and the forms of global warrant certificates representing the Currency Put Warrants and the Currency Call Warrants (the "Currency Warrant Certificates"), reflecting the provisions to be included in the Currency Warrant Agreement that will be entered into with respect to particular offerings of Currency Warrants, will be filed in an amendment to the registration statement of which this prospectus is a part or filed in a Current Report on Form 8-K and incorporated by reference in the registration statement of which this prospectus is a part are filed as exhibits in the applicable registration statement of which this prospectus is a part. The following description of certain provisions of the forms of Currency Warrant Agreements and the Currency Warrant Certificates does not purport to be complete and is subject to all the provisions of the Currency Warrant Agreements and the Currency Warrant Certificates, respectively, to be filed in an amendment to the registration statement of which this prospectus is a part or to be filed on a Current Report on Form 8-K and incorporated by reference in the registration statement of which this prospectus is a part, including the definitions therein of certain capitalized terms not defined herein. GENERAL If we offer currency warrants, the applicable prospectus supplement will describe their terms, which may include the following: (i) whether such currency warrants will be Currency Put Warrants, Currency Call Warrants, or both; (ii) the formula for determining the Cash Settlement Value, if any, of each currency warrant; (iii) the procedures and conditions relating to the exercise of such currency warrants; (iv) the circumstances which will cause the currency warrants to be deemed to be automatically exercised; (v) any minimum number of currency warrants which must be exercised at any one time, other than upon automatic exercise; and (vi) the date on which the right to exercise such currency warrants will commence and the date on which such right will expire (the "Expiration Date"). BOOK-ENTRY PROCEDURES AND SETTLEMENT Except as may otherwise be provided in the applicable prospectus supplement, the currency warrants will be issued in the form of global Currency Warrant Certificates, registered in the name of a depositary or its nominee. Holders will not be entitled to receive definitive certificates representing currency warrants. A holder's ownership of a currency warrant will be recorded on or through the records of the brokerage firm or other entity that maintains such holder's account. In turn, the total number of currency warrants held by an individual brokerage firm for its clients will be maintained on the records of the depositary in the name of such brokerage firm or its agent. Transfer of ownership of any currency warrant will be effected only through the selling holder's brokerage firm. 24 26 EXERCISE OF CURRENCY WARRANTS Each currency warrant will entitle the holder to receive the Cash Settlement Value of such currency warrant on the applicable Exercise Date, in each case as such terms will be defined in the applicable prospectus supplement. If not exercised prior to 3:00 P.M., New York City time, on the third New York Business Day preceding the Expiration Date, currency warrants will be deemed automatically exercised on the Expiration Date. PLAN OF DISTRIBUTION The following summary of our plan for distributing the securities offered under this prospectus will be supplemented by a description of our specific plan for each offering in the prospectus supplement relating to such offering. Such description will include, among other things, the terms of the underwriting arrangements applicable to such offering. We may sell the securities offered under this prospectus through agents, through underwriters or dealers or directly to one or more purchasers. The prospectus supplement with respect to the offered securities will set forth the terms of the offering of such offered securities, including the name or names of any underwriters, dealers or agents, the purchase price of such offered securities and the proceeds to us from such sale, any underwriting discounts and other items constituting underwriters' compensation, any initial public offering price and any discounts, commissions or concessions allowed or reallowed or paid to dealers, and any bidding or auction process. Any initial offering price and any discounts, concessions or commissions allowed or reallowed or paid to dealers may be changed from time to time. If underwriters are used in an offering, the offered securities will be acquired by the underwriters for their own account. The offered securities may be sold from time to time in one or more transactions, including negotiated transactions, at a fixed public offering price or at varying prices determined at the time of sale. The offered securities may be offered to the public either through underwriting syndicates represented by one or more managing underwriters or directly by one or more of such firms. The specific managing underwriter or underwriters, if any, will be set forth in the applicable prospectus supplement together with the members of the underwriting syndicate, if any. Unless otherwise set forth in the prospectus supplement, the obligations of the underwriters to purchase the offered securities will be subject to certain conditions precedent and the underwriters will be obligated to purchase all such offered securities if any are purchased. Offered securities may be sold directly by us or through agents designated by us from time to time. The prospectus supplement will set forth the name of any agent involved in the offer or sale of the offered securities in respect of which the prospectus supplement is delivered and any commissions payable by us to such agent. Unless otherwise indicated in the prospectus supplement, any such agent is acting on a best efforts basis for the period of its appointment. Any underwriters, dealers, or agents participating in the distribution of the offered securities may be deemed to be underwriters and any discounts or commissions received by them on the sale or resale of the offered securities may be deemed to be underwriting discounts and commissions under the Securities Act of 1933, as amended. Agents, dealers or underwriters may be entitled, under agreements entered into with us, to indemnification by us against certain liabilities, including liabilities under the Securities Act of 1933, as amended, and to contribution with respect to payments which the agents, dealers or underwriters may be required to make in respect thereof. Agents, dealers and underwriters may engage in transactions with or perform services for us in the ordinary course of business. 25 27 The offered securities, other than the Common Stock, will be a new issue or issues of securities with no established trading market. Any Common Stock offered by this prospectus will be listed. Unless otherwise indicated in the applicable prospectus supplement, we do not currently intend to list any offered debt securities or warrants on any securities exchange. No assurance can be given that the underwriters, dealers or agents, if any, involved in the sale of the offered securities will make a market in such offered securities. Whether or not any of the offered securities are listed on a national securities exchange or the underwriters, dealers or agents, if any, involved in the sale of the offered securities make a market in such offered securities, no assurance can be given as to the liquidity of the trading market for such offered securities. DELAYED DELIVERY ARRANGEMENTS If so indicated in the applicable prospectus supplement, we may authorize underwriters or other persons acting as our agents to solicit offers by certain institutions to purchase offered securities from us under contracts providing for payment and delivery on a future date. Institutions with which such contracts may be made include: - commercial and savings banks, - insurance companies, - pension funds, - investment companies, and - educational and charitable institutions and others, but in all cases will be subject to our approval. The obligations of any purchaser under any such contract will be subject to the conditions that the purchase of the offered securities shall not at the time of delivery be prohibited under the laws of the jurisdiction to which such purchaser is subject and, if the securities are also being sold to underwriters acting as principals for their own account, the underwriters shall have purchased such securities not sold for delayed delivery. The underwriters and such agents will not have any responsibility in respect of the validity or performance of such contracts. LEGAL MATTERS Unless otherwise indicated in the applicable prospectus supplement, certain legal matters in connection with the securities offered hereby will be passed upon for us by Kirkland & Ellis (a partnership including professional corporations), Chicago, Illinois. EXPERTS Ernst & Young LLP, independent auditors, have audited our consolidated financial statements and schedule included in our Annual Report on Form 10-K for the year ended December 31, 1998, as set forth in their report, which is incorporated by reference in this prospectus and elsewhere in the registration statement. Our consolidated financial statements and schedule are incorporated by reference in reliance on Ernst & Young LLP's report, given on their authority as experts in accounting and auditing. 26 28 PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION The following is an estimate, subject to future contingencies, of the expenses to be incurred by the Registrant in connection with the issuance and distribution of the securities being registered: Registration Fee*........................................... $208,500 Legal Fees and Expenses**................................... 100,000 Trustee Fees and Expenses**................................. 20,000 Accounting Fees and Expenses**.............................. 100,000 Blue Sky Fees and Expenses**................................ 60,000 Printing Fees**............................................. 100,000 Listing Fees**.............................................. 60,000 Miscellaneous**............................................. 1,500 -------- Total............................................. $650,000 ========
- ------------------------- * Includes amounts paid in connection with the Unused Registration Statement. ** Estimated pursuant to instruction to Item 511 of Regulation S-K. ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS Section 145 of the Delaware General Corporation Law (the "DGCL") authorizes a corporation to indemnify a person against expenses and certain liabilities incurred by him in connection with any proceeding in which he is involved by reason of his being or having been a director, officer, employee or agent of the corporation or its affiliates. Further, Article Ninth of the Company's Certificate of Incorporation and Article VII of its By-Laws provide for indemnification, to the full extent permitted by the DGCL, of the Company's directors and officers. The Company maintains so-called "D & O" liability insurance coverage, insuring it against loss resulting from discharge of such liabilities against which they cannot be indemnified by the Company (subject to certain exclusions). Reference is made to clause (e) under Item 9 below with respect to indemnification for liabilities arising under the Securities Act of 1933, as amended, required or permitted to directors, officers or persons controlling the Company pursuant to the foregoing provisions. The form of Underwriting Agreement included as an exhibit to this registration statement provides for indemnification of directors and officers of the Company against certain liabilities. ITEM 16. EXHIBITS The following Exhibits are filed as part of this registration statement: 1.1 Form of Underwriting Agreement.+ 1.2 Form of Distribution Agreement.* 4.1 Certificate of Incorporation (incorporated by reference to the Company's Annual Report on Form 10-K for the period ended December 31, 1997 (File No. 001-06450)). 4.2 By-Laws (incorporated by reference to the Company's Annual Report on Form 10-K for the period ended December 31, 1997 (File No. 001-06450)). 4.3 Rights Agreement, dated as of February 15, 1999, between Great Lakes Chemical Corporation and Harris Trust Company of New York, as Rights Agent, which includes as Exhibit A the form of Rights Certificate (incorporated by reference to Exhibit 4 to the Company's Registration Statement on Form 8-A dated March 23, 1999 (File No. 001-06450)).
II-1 29 4.4 Indenture dated as of September 7, 1989 between Great Lakes Chemical Corporation and Bank of Montreal Trust Company, as Trustee. (incorporated by reference to the Company's Registration Statement on Form 8-A/A dated December 12, 1995 (File No. 001-06450)). 4.5 Form of Indenture between the Company and The First National Bank of Chicago.+ 4.6 Form of Senior Debt Securities.* 4.7 Form of Subordinated Debt Securities Indenture.* 4.8 Form of Subordinated Debt Securities.* 4.9 Form of Debt Warrant Agreement, including form of Debt Warrant Certificate.* 4.10 Form of Stock Warrant Agreement, including form of Stock Warrant Certificate.* 4.11 Form of Currency Warrant Agreement, including form of Currency Warrant Certificate.* 5.1 Opinion of Kirkland & Ellis.+ 12.1 Computation of Ratio of Earnings to Fixed Charges.+ 23.1 Consent of Ernst & Young LLP.+ 23.2 Consent of Kirkland & Ellis (included in Exhibit 5).+ 24. Powers of Attorney (included on signature page). 25.1 Statement of Eligibility on Form T-1 of The First National Bank of Chicago, as Trustee pursuant to the Senior Indenture pursuant to which the Senior Debt Securities registered hereunder are to be issued.+
- ------------------------- + To be filed by amendment. + Filed herewith. * To be filed, if necessary, subsequent to the effectiveness of this registration statement by an amendment to the registration statement or incorporated by reference pursuant to a Current Report on Form 8-K in connection with the offering of securities. ITEM 17. UNDERTAKINGS (a) The undersigned registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement; (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Commission by the registrant pursuant to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement. II-2 30 (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (b) The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant's annual report pursuant to section 13(a) or section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. (d) The undersigned registrant hereby undertakes that: (1) For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) pursuant to the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective. (2) For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (e) The undersigned registrant hereby undertakes to file an application for the purpose of determining the eligibility of the trustee to act under subsection (a) of Section 310 of the Trust Indenture Act in accordance with the rules and regulations prescribed by the Securities and Exchange Commission under Section 305(b)(2) of the Trust Indenture Act. II-3 31 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, as amended, the Company certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this registration statement, or amendment thereto, to be signed on its behalf by the undersigned, duly authorized, in Indianapolis, Indiana, on the 6th day of May, 1999. GREAT LAKES CHEMICAL CORPORATION By: /s/ MARK E. TOMKINS ----------------------------------- Mark E. Tomkins Senior Vice President and Chief Financial Officer POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Mark E. Tomkins, Gregory J. Heinlein and Karen W. Duros and each of them, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments (including post-effective amendments) to this registration statement (and any registration statement filed pursuant to Rule 462(b) under the Securities Act of 1933, as amended, for the offerings which this Registration Statement relates), and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof. * * * * PURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED, THIS REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS, IN THE CAPACITIES INDICATED, ON MAY 6, 1999.
SIGNATURE TITLE --------- ----- /s/ MARK P. BULRISS President and Chief Executive Officer, Director - --------------------------------------------- (Principal Executive Officer) Mark P. Bulriss /s/ MARK E. TOMKINS Senior Vice President and Chief Financial Officer - --------------------------------------------- (Principal Financial Officer) Mark E. Tomkins /s/ ROBERT J. SMITH Vice President and Controller (Principal Accounting - --------------------------------------------- Officer) Robert J. Smith /s/ THOMAS M. FULTON Director - --------------------------------------------- Thomas M. Fulton /s/ MARTIN M. HALE Director - --------------------------------------------- Martin M. Hale
II-4 32
SIGNATURE TITLE --------- ----- /s/ LOUIS E. LATAIF Director - --------------------------------------------- Louis E. Lataif /s/ RICHARD H. LEET Director - --------------------------------------------- Richard H. Leet /s/ MACK G. NICHOLS Director - --------------------------------------------- Mack G. Nichols /s/ JAY D. PROOPS Director - --------------------------------------------- Jay D. Proops
II-5 EX-4.5 2 FORM OF INDENTURE 1 GREAT LAKES CHEMICAL CORPORATION, ISSUER INDENTURE DATED AS OF ________ __, 1999 THE FIRST NATIONAL BANK OF CHICAGO, TRUSTEE PROVIDING FOR THE ISSUANCE OF SENIOR DEBT SECURITIES IN SERIES 2 TABLE OF CONTENTS
Page ---- ARTICLE I--DEFINITIONS AND INCORPORATION BY REFERENCE......................................................... 1 SECTION 1.1 DEFINITIONS.............................................................................. 1 SECTION 1.2 OTHER DEFINITIONS........................................................................ 9 SECTION 1.3 INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT........................................ 9 SECTION 1.4 RULES OF CONSTRUCTION.................................................................... 10 ARTICLE II--THE SECURITIES.................................................................................... 10 SECTION 2.1 TERMS AND FORMS.......................................................................... 10 SECTION 2.2 EXECUTION AND AUTHENTICATION............................................................. 14 SECTION 2.3 REGISTRAR, PAYING AGENT, CONVERSION AGENT, DEPOSITORY AND SECURITIES CUSTODIAN........... 16 SECTION 2.4 SECURITYHOLDER LISTS..................................................................... 16 SECTION 2.5 TRANSFER, REGISTRATION AND EXCHANGE...................................................... 17 SECTION 2.6 REPLACEMENT SECURITIES................................................................... 19 SECTION 2.7 OUTSTANDING SECURITIES................................................................... 20 SECTION 2.8 TREASURY SECURITIES...................................................................... 21 SECTION 2.9 TEMPORARY SECURITIES..................................................................... 21 SECTION 2.10 SECURITIES IN GLOBAL FORM................................................................ 21 SECTION 2.11 CANCELLATION............................................................................. 21 SECTION 2.12 DEFAULTED INTEREST....................................................................... 22 SECTION 2.13 PERSONS DEEMED OWNERS.................................................................... 22 SECTION 2.14 CUSIP NUMBERS............................................................................ 23 ARTICLE III--REDEMPTION....................................................................................... 23 SECTION 3.1 APPLICABILITY OF ARTICLE................................................................. 23 SECTION 3.2 NOTICES TO TRUSTEE....................................................................... 23 SECTION 3.3 SELECTION OF SECURITIES TO BE REDEEMED................................................... 24 SECTION 3.4 NOTICE OF REDEMPTION..................................................................... 24 SECTION 3.5 EFFECT OF NOTICE OF REDEMPTION........................................................... 25 SECTION 3.6 DEPOSIT OF REDEMPTION PRICE.............................................................. 26 SECTION 3.7 SECURITIES REDEEMED IN PART.............................................................. 26 ARTICLE IV--COVENANTS......................................................................................... 27 SECTION 4.1 PAYMENT OF SECURITIES.................................................................... 27 SECTION 4.2 MAINTENANCE OF OFFICE OR AGENCY FOR NOTICES AND DEMANDS.................................. 27 SECTION 4.3 MONEY FOR SECURITIES PAYMENTS TO BE HELD IN TRUST........................................ 28
i 3 SECTION 4.4 COMMISSION REPORTS; REPORTS TO TRUSTEE; REPORTS TO HOLDERS............................... 30 SECTION 4.5 COMPLIANCE CERTIFICATES.................................................................. 30 SECTION 4.6 CORPORATE EXISTENCE...................................................................... 31 SECTION 4.7 LIMITATION ON LIENS...................................................................... 31 SECTION 4.8 LIMITATIONS ON SALE AND LEASEBACK TRANSACTIONS........................................... 31 SECTION 4.9 EXEMPTED INDEBTEDNESS.................................................................... 32 SECTION 4.10 WAIVER OF STAY; EXTENSION OF USURY LAWS.................................................. 32 ARTICLE V--SUCCESSORS......................................................................................... 33 SECTION 5.1 WHEN COMPANY MAY MERGE, ETC.............................................................. 33 SECTION 5.2 SUCCESSOR CORPORATION SUBSTITUTED........................................................ 33 ARTICLE VI--DEFAULTS AND REMEDIES............................................................................. 33 SECTION 6.1 EVENTS OF DEFAULT........................................................................ 33 SECTION 6.2 ACCELERATION............................................................................. 35 SECTION 6.3 OTHER REMEDIES........................................................................... 35 SECTION 6.4 WAIVER OF PAST DEFAULTS.................................................................. 36 SECTION 6.5 CONTROL BY MAJORITY...................................................................... 36 SECTION 6.6 LIMITATION ON SUITS BY HOLDERS........................................................... 36 SECTION 6.7 RIGHTS OF HOLDERS TO RECEIVE PAYMENT..................................................... 37 SECTION 6.8 COLLECTION SUIT BY TRUSTEE............................................................... 37 SECTION 6.9 TRUSTEE MAY FILE PROOFS OF CLAIM......................................................... 37 SECTION 6.10 APPLICATION OF MONEY COLLECTED........................................................... 37 SECTION 6.11 UNDERTAKING FOR COSTS.................................................................... 38 SECTION 6.12 DISCONTINUANCE OR ABANDONMENT OF PROCEEDINGS............................................. 39 ARTICLE VII--TRUSTEE.......................................................................................... 39 SECTION 7.1 DUTIES OF TRUSTEE........................................................................ 39 SECTION 7.2 RIGHTS OF TRUSTEE........................................................................ 40 SECTION 7.3 INDIVIDUAL RIGHTS OF TRUSTEE............................................................. 41 SECTION 7.4 TRUSTEE'S DISCLAIMER..................................................................... 41 SECTION 7.5 NOTICE OF DEFAULTS....................................................................... 41 SECTION 7.6 REPORTS BY TRUSTEE TO HOLDERS............................................................ 42 SECTION 7.7 COMPENSATION AND INDEMNITY............................................................... 42 SECTION 7.8 REPLACEMENT OF TRUSTEE................................................................... 43 SECTION 7.9 SUCCESSOR TRUSTEE BY MERGER.............................................................. 44 SECTION 7.10 ELIGIBILITY; DISQUALIFICATION............................................................ 44 SECTION 7.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY........................................ 44 SECTION 7.12 MONEY HELD IN TRUST...................................................................... 44
ii 4 ARTICLE VIII--DISCHARGE OF INDENTURE; DEFEASANCE ............................................................. 44 SECTION 8.1 DISCHARGE OF INDENTURE; DEFEASANCE....................................................... 44 SECTION 8.2 CONDITIONS TO DEFEASANCE................................................................. 45 SECTION 8.3 APPLICATION OF TRUST MONEY............................................................... 46 SECTION 8.4 REPAYMENT TO COMPANY..................................................................... 46 SECTION 8.5 REINSTATEMENT OF COMPANY'S OBLIGATIONS................................................... 47 ARTICLE IX--AMENDMENTS AND WAIVER............................................................................. 47 SECTION 9.1 WITHOUT CONSENT OF HOLDERS............................................................... 47 SECTION 9.2 WITH CONSENT OF HOLDERS.................................................................. 48 SECTION 9.3 COMPLIANCE WITH TRUST INDENTURE ACT...................................................... 49 SECTION 9.4 REVOCATION AND EFFECT OF CONSENTS AND WAIVERS............................................ 49 SECTION 9.5 NOTATION ON OR EXCHANGE OF SECURITIES.................................................... 50 SECTION 9.6 TRUSTEE TO SIGN AMENDMENTS............................................................... 50 ARTICLE X--REPAYMENT AT THE OPTION OF HOLDERS ................................................................ 51 SECTION 10.1 APPLICABILITY OF ARTICLE................................................................. 51 ARTICLE XI--SINKING FUNDS..................................................................................... 51 SECTION 11.1 APPLICABILITY OF ARTICLE................................................................. 51 SECTION 11.2 SATISFACTION OF SINKING FUND PAYMENTS WITH SECURITIES.................................... 51 SECTION 11.3 REDEMPTION OF SECURITIES FOR SINKING FUND................................................ 52 ARTICLE XII--CONVERSION OF SECURITIES......................................................................... 52 SECTION 12.1 APPLICABILITY OF ARTICLE................................................................. 52 SECTION 12.2 EXERCISE OF CONVERSION PRIVILEGE......................................................... 53 SECTION 12.3 FRACTIONAL INTERESTS..................................................................... 54 SECTION 12.4 ADJUSTMENT OF CONVERSION PRICE........................................................... 54 SECTION 12.5 CONTINUATION OF CONVERSION PRIVILEGE IN CASE OF MERGER, CONSOLIDATION OR SALE OF ASSETS................................................................................... 57 SECTION 12.6 NOTICE OF CERTAIN EVENTS................................................................. 58 SECTION 12.7 TAXES ON CONVERSION...................................................................... 59 SECTION 12.8 COMPANY TO PROVIDE STOCK................................................................. 59 SECTION 12.9 DISCLAIMER OF RESPONSIBILITY FOR CERTAIN MATTERS......................................... 60 SECTION 12.10 RETURN OF FUNDS DEPOSITED FOR REDEMPTION OF CONVERTED SECURITIES......................... 60 SECTION 12.11 RIGHTS ISSUED IN RESPECT OF COMMON STOCK ISSUED UPON CONVERSION.......................... 60 ARTICLE XIII--MISCELLANEOUS................................................................................... 61 SECTION 13.1 TRUST INDENTURE ACT CONTROLS............................................................. 61
iii 5 SECTION 13.2 NOTICES.................................................................................. 61 SECTION 13.3 COMMUNICATION BY HOLDERS WITH OTHER HOLDERS.............................................. 62 SECTION 13.4 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT....................................... 62 SECTION 13.5 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION............................................ 62 SECTION 13.6 RULES BY TRUSTEE AND AGENTS.............................................................. 63 SECTION 13.7 LEGAL HOLIDAYS........................................................................... 63 SECTION 13.8 NO RECOURSE AGAINST OTHERS............................................................... 63 SECTION 13.9 GOVERNING LAW............................................................................ 63 SECTION 13.10 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS............................................ 63 SECTION 13.11 SUCCESSORS............................................................................... 63 SECTION 13.12 SEVERABILITY............................................................................. 63 SECTION 13.13 MULTIPLE ORIGINALS....................................................................... 64 SECTION 13.14 TABLE OF CONTENTS; HEADINGS.............................................................. 64 SECTION 13.15 SECURITIES IN FOREIGN CURRENCIES......................................................... 64
iv 6 CROSS-REFERENCE TABLE
TIA Section Indenture Section - ----------- ----------------- 310 (a)(1) ......................................................... 7.10 (a)(2) ......................................................... 7.10 (a)(3) ......................................................... N.A. (a)(4) ......................................................... N.A. (b) ......................................................... 7.8, 7.10, 13.2 (c) ......................................................... N.A. 311 (a) ......................................................... 7.11 (b) ......................................................... 7.11 (c) ......................................................... N.A. 312 (a) ......................................................... 2.4 (b) ......................................................... 13.3 (c) ......................................................... 13.3 313 (a) ......................................................... 7.6 (b)(1) ......................................................... N.A. (b)(2) ......................................................... 7.6 (c) ......................................................... 7.6, 13.2 (d) ......................................................... 7.6 314 (a) ......................................................... 4.4, 13.2 (b) ......................................................... N.A. (c)(1) ......................................................... 13.4 (c)(2) ......................................................... 13.4 (c)(3) ......................................................... N.A. (e) ......................................................... 13.5 (f) ......................................................... N.A. 315 (a) ......................................................... 7.1(b) (b) ......................................................... 7.5, 10.2 (c) ......................................................... 7.1(a) (d) ......................................................... 7.1(c) (e) ......................................................... 6.11 316 (a) (Last Sentence) ................................................ 2.8 (a)(1)(A) ......................................................... 6.5 (a)(1)(B) ......................................................... 6.4 (a)(2) ......................................................... N.A. (b) ......................................................... 6.7 317 (a)(1) ......................................................... 6.8 (a)(2) ......................................................... 6.9 (b) ......................................................... 4.3 318 (a) ......................................................... 13.1
N.A. means not applicable. v 7 INDENTURE dated as of _____ __, 1999 between GREAT LAKES CHEMICAL CORPORATION, a Delaware corporation (the "Company"), and THE FIRST NATIONAL BANK OF CHICAGO (the "Trustee"). Each party agrees as follows for the benefit of the other party and for the equal and ratable benefit of the Holders of the Company's Securities issued hereunder: ARTICLE I DEFINITIONS AND INCORPORATION BY REFERENCE SECTION 1.1 DEFINITIONS. "Additional Amounts" means any additional amounts which are required by a Security or by or pursuant to a Board Resolution, under circumstances specified therein, to be paid by the Company in respect of certain taxes imposed on certain Holders, or as otherwise specified in the terms of a Security established pursuant to Section 2.1, and which are owing to such Holders. "Affiliate" shall mean, with respect to any Person, another Person directly or indirectly controlling or controlled by or under direct or indirect common control with such first Person. For the purposes of this definition, "control," (including, with correlative meanings, the terms "controlling," "controlled by" and "under common control with"), as applied to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of that Person, whether through the ownership of voting securities or by contract or otherwise. The Trustee may request and conclusively rely on an Officers' Certificate to determine whether any Person is an Affiliate of the Company. "Agent" shall mean any Registrar or Paying Agent or authenticating agent or co-registrar. "Authorized Newspaper" means a newspaper printed in the official language of the country of publication and customarily published at least once a day on each Business Day in each calendar week and of general circulation in New York, New York or in any other place as required in this Indenture, whether or not such newspaper is published on Legal Holidays, or, with respect to the Securities of any series, such other newspaper(s) as may be specified in or pursuant to the Board Resolution of the Company or supplement to this Indenture pursuant to which such series of Securities is issued. Whenever, under the provisions of this Indenture or such Board Resolution, two or more publications of a notice or other communication are required or permitted, such publications may be in the same or different newspapers. If, because of temporary or permanent suspension of publication or general circulation of any newspaper or for any other reason, it is impossible or impracticable to publish any notices required by this Indenture or a Board Resolution in the manner provided, then such publication in lieu thereof or such other notice as shall be made with the approval of the Trustee shall constitute a sufficient publication of such notice. 8 "Bankruptcy Law" shall mean Title 11, United States Code or any similar federal or state law for the relief of debtors. "Bearer Security" means any security in the form established pursuant to Section 2.1 hereunder which is payable to bearer. "Board" or "Board of Directors" shall mean the Board of Directors of the Company or any authorized committee of such Board or any authorized committee created by such Board. "Board Resolution" means a copy of the resolutions certified by the Secretary or an Assistant Secretary of the Company as properly adopted by the Board of Directors of the Company and in full force and effect and delivered to the Trustee. "Business Day" shall mean each day that is not a Legal Holiday. "Capital Stock" shall mean, with respect to any Person, any and all shares, interests, participations or other equivalents (however designated, whether voting or non-voting) of such Person's capital stock or equity interests in a partnership, joint venture, limited liability company or other equity that is outstanding or issued on or after the Issue Date, including, without limitation, all classes and series of such Person's common stock or ordinary shares, preferred stock and preference stock. "Capitalized Lease Obligation" shall mean an obligation that is required to be classified and accounted for as a capitalized lease for financial reporting purposes in accordance with GAAP, and the amount of Indebtedness represented by such obligation shall be the capitalized amount of such obligation determined in accordance with such principles; and the Stated Maturity thereof shall be the date of the last payment of rent or any other amount due under such lease prior to the first date upon which such lease may be terminated by the lessee without payment of a penalty. "Commission" shall mean the Securities and Exchange Commission. "Common Stock" shall mean the common stock, $1.00 par value per share, of the Company. "Company" shall mean Great Lakes Chemical Corporation, a Delaware corporation, until a successor replaces it in accordance with Article V and, thereafter, means the successor and, for purposes of any provision contained herein and required by the TIA, each other obligor on the indenture securities. "Company Request" or "Company Order" shall mean a written request or order signed in the name of the Company by the Chairman of the Board, the President, the Chief Financial Officer or the Treasurer thereof or any other officer specifically authorized to act by the Board of Directors of the Company, and delivered to the Trustee. 2 9 "Consolidated Net Worth" shall mean the excess of assets over liabilities of the Company and its consolidated Subsidiaries, plus Minority Interests, as determined from time to time in accordance with GAAP. "Consolidation" shall mean, with respect to any Person, the consolidation of the accounts of such Person if and to the extent the accounts of such Person and each of its Subsidiaries (or, if such Person is the Company, its Restricted Subsidiaries) would normally be consolidated with those of such Person, all in accordance with GAAP. The term "consolidated" shall have a similar meaning. "Corporate Trust Office of the Trustee" shall be at the address of the Trustee specified in Section 13.2 or such other address as the Trustee may give to the Company. "coupon" shall mean any interest coupon appertaining to a Bearer Security. "Currency Agreement" shall mean any foreign exchange contract, currency swap agreement or other similar agreement or arrangement designed to protect such Person or any of its Restricted Subsidiaries against fluctuations in currency values. "Default" shall mean any event that is, or after notice or passage of time or both would be, an Event of Default as defined in Section 6.1 of this Indenture. "Depository" or "U.S. Depository" shall mean, with respect to the Securities of any series issuable or issued in whole or in part in the form of one or more global Securities, the Person designated as U.S. Depository pursuant to Section 2.1, which must be a clearing agency registered under the Exchange Act, and, if so provided pursuant to Section 2.1 with respect to the Securities of any series, any successor to such Person. If at any time there is more than one such Person, "Depository" or "U.S. Depository" shall mean, with respect to any series of Securities, the qualifying entity which has been appointed with respect to the Securities of that series. "Eligible Obligations" shall mean obligations as a result of the deposit of which (along with the simultaneous deposit, if any, of money or U.S. Government obligations or both) the Securities will be rated in the highest generic long-term debt rating category assigned by one or more nationally recognized rating agencies to debt with respect to which the issuer thereof has been released from its obligations to the same extent that the Company has been released from its obligations under this Indenture pursuant to the defeasance provision of this Indenture. "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended. "GAAP" shall mean generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as may be approved by a significant segment of the accounting profession, consistently applied, that are applicable to the circumstances as of the date of determination; provided that, for purposes of calculating the Consolidated Net Worth of a Person 3 10 (including all components thereof), "GAAP" shall mean such generally accepted accounting principles as described above in effect on the date of this Indenture. "Holder," "Securityholders" or "Holders of Securities" or other similar term shall mean, with respect to a Registered Security, the person in whose name a particular Security shall be registered on the books of the Registrar kept for that purpose in accordance with the terms hereof and, with respect to a Bearer Security or any coupon, the bearer thereof, and the word "majority," used in connection with the term "Holder," "Securityholders" or "Holder of Securities" or other similar term, shall signify the "majority in principal amount" whether or not so expressed. "incur" shall mean, with respect to any Indebtedness or other obligation of any Person, to create, issue, incur (by conversion, exchange or otherwise), assume, guarantee or otherwise become liable in respect of such Indebtedness or other obligation or the recording, as required pursuant to GAAP or otherwise, of any such Indebtedness or other obligation on the balance sheet of such Person (and "incurrence," "incurred," "incurrable," and "incurring" shall have meanings correlative to the foregoing); provided that a change in GAAP that results in an obligation of such Person that exists at such time becoming Indebtedness shall not be deemed an incurrence of such Indebtedness. "Indebtedness" shall mean, with respect to any Person, at any date, any of the following, without duplication, (i) any liability, contingent or otherwise, of such Person (A) for borrowed money (whether or not the recourse of the lender is to the whole of the assets of such Person or only to a portion thereof), (B) evidenced by a note, bond, debenture or similar instrument or (C) for the payment of money relating to a Capitalized Lease Obligation or other obligation (whether issued or assumed) relating to the deferred purchase price of property; (ii) all conditional sale obligations and all obligations under any title retention agreement (even if the rights and remedies of the seller under such agreement in the event of default are limited to repossession or sale of such property), but excluding trade accounts payable arising in the ordinary course of business; (iii) all obligations for the reimbursement of any obligor on any letter of credit, banker's acceptance or similar credit transaction other than entered into in the ordinary course of business; (iv) all indebtedness of others secured by (or for which the holder of such indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on any asset or property (including, without limitation, leasehold interests and any other tangible or intangible property) of such Person, whether or not such indebtedness is assumed by such Person or is not otherwise such Person's legal liability; provided, that if the obligations so secured have not been assumed in full by such Person or are otherwise not such Person's legal liability in full, the amount of such indebtedness for the purposes of this definition shall be limited to the lesser of the amount of such indebtedness secured by such Lien or the fair market value of the assets of the property securing such Lien; (v) all indebtedness of others (including all interest and dividends on any indebtedness or preferred stock of any other Person for the payment of which is) guaranteed, directly or indirectly, by such Person or that is otherwise its legal liability or which such Person has agreed to purchase or repurchase or in respect of which such Person has agreed contingently to supply or advance funds; and (vi) obligations in respect of Currency Agreements and Interest Swap Obligations. "Indenture" shall mean this Indenture as amended or supplemented from time to time. 4 11 "Interest Swap Obligations" shall mean the obligations of any Person pursuant to any interest rate swap agreement, interest rate collar agreement or other similar agreement or arrangement designed to protect such Person or any of its Subsidiaries against fluctuations in interest rates. "Internal Revenue Code" shall mean the Internal Revenue Code of 1986, as amended from time to time, or any successor federal income tax laws. "Issue Date" shall mean the first date on which a Security is authenticated by the Trustee pursuant to this Indenture. "Legal Holiday" shall mean a Saturday, a Sunday or a day on which banking institutions are not required to be open in New York, New York, Chicago, Illinois, or in a state where a Place of Payment is located. "Lien" shall mean any mortgage, pledge, security interest, encumbrance, lien, charge or adverse claim affecting title or resulting in an encumbrance against real or personal property or a security interest of any kind (including, without limitation, any conditional sale or other title retention agreement or lease in the nature thereof or any filing or agreement to file a financing statement as debtor under the Uniform Commercial Code or any similar statute other than to reflect ownership by a third party or property leased to the Company or any of its Subsidiaries under a lease that is not in the nature of a conditional sale or title retention agreement). "Maturity" when used with respect to any Security shall mean the date on which the principal of such Security or an installment of principal becomes due and payable as therein or herein provided, whether at Stated Maturity or by declaration of acceleration, call for redemption or otherwise. "Minority Interest" shall mean any shares of stock of any class of a Subsidiary that are not owned by the Company or a Subsidiary. "Officer" shall mean the Chairman of the Board of Directors, the Vice Chairman, the President, the Treasurer, any Assistant Treasurer, Controller, Secretary, Assistant Secretary, or any Vice President of the Company. "Officers' Certificate" shall mean, with respect to any Person, a certificate signed by the Chief Executive Officer, the President or any Vice President and by the Treasurer or any Assistant Treasurer or the Secretary or any Assistant Secretary of such Person that shall comply with applicable provisions of this Indenture. "Opinion of Counsel" shall mean an opinion in writing signed by a Person's legal counsel (who may be an employee of or counsel to such Person or the Trustee) who is acceptable to the Trustee. "Original Issue Discount Security" shall mean any Security which provides that an amount less than its principal amount is due and payable upon the acceleration of the maturity thereof after an Event of Default. 5 12 "Periodic Offering" shall mean an offering of Securities of a series from time to time the specific terms of which Securities, including, without limitation, the rate or rates of interest, if any, thereon, the maturity or maturities thereof, the original issue date or dates thereof, the redemption provisions, if any, and any other terms specified as contemplated by Section 2.1 with respect thereto, are to be determined by the Company, or one or more of the Company's agents designated in an Officers' Certificate, upon the issuance of such Securities. "Permitted Liens" shall mean, with respect to any Person: (i) Liens existing on the Issue Date; (ii) Liens on property or assets of, or any shares of stock of or secured debt of, any corporation existing at the time such corporation becomes a Restricted Subsidiary of the Company or at the time such corporation is merged into the Company or any of its Restricted Subsidiaries; (iii) Liens in favor of the Company or any of its Restricted Subsidiaries; (iv) Liens in favor of governmental bodies to secure progress or advance payments; (v) Liens securing industrial revenue or pollution control bonds; (vi) Liens on Property to secure Indebtedness incurred for the purpose of (i) financing all or any part of the purchase price of such Property incurred prior to, at the time of, or within 180 days after, the acquisition of such property or assets or (ii) financing all or any part of the cost of construction, improvement, development or expansion of any such Property; (vii) Statutory liens or landlords', carriers', warehouseman's, mechanics', suppliers', materialmen's, repairmen's or other like Liens arising in the ordinary course of business and with respect to amounts not yet delinquent or being contested in good faith by appropriate proceedings, if a reserve or other appropriate provision, if any, as shall be required in conformity with GAAP shall have been made therefor; (viii) Liens on current assets of Restricted Subsidiaries securing Indebtedness of such Restricted Subsidiaries; and (ix) any extensions, substitutions, replacements or renewals in whole or in part of a Lien (an "existing Lien") enumerated in clauses (i) through (viii) above; provided that the Lien may not extend beyond (A) the Property or Indebtedness subject to the existing Lien and (B) improvements and construction on such Property and the Indebtedness secured by the Lien may not exceed the Indebtedness secured at the time by the existing Lien. 6 13 "Person" shall mean any individual, corporation, partnership, limited partnership, joint venture, association, joint-stock company, trust, unincorporated organization, government or any agency or political subdivision thereof, or any other entity. "Place of Payment" when used with respect to the Securities of any series, means the place or places where the principal of and interest and any Additional Amounts on the Securities of that series are payable as specified as provided pursuant to Section 2.1. "principal" of a debt security (including the Securities) shall mean the principal of the security plus the premium, if any, payable on the security which is due or overdue or is to become due at the relevant time. "Principal Property" shall mean any manufacturing plant or warehouse owned or leased by the Company or any Subsidiary whether owned or leased on the date hereof or hereafter, the gross book value of which exceeds one percent of Consolidated Net Worth, other than manufacturing plants and warehouses which the Board of Directors by resolution declares are not of material importance to the total business conducted by the Company and its Restricted Subsidiaries as an entirety and which, when taken together with all other plants and warehouses as to which such a declaration has been so made, is so declared by the Board of Directors to be not of material importance to the total business conducted by the Company and its Restricted Subsidiaries as an entirety. "Property" of any Person means all types of real, personal, tangible, intangible or mixed property owned by such Person whether or not included in the most recent consolidated balance sheet of such Person and its Subsidiaries under GAAP. "Redemption Date" when used with respect to any Security to be redeemed shall mean the date fixed for such redemption by or pursuant to this Indenture. "Redemption Price" shall mean the amount payable for the redemption of any Security on the Redemption Date, and shall always include interest accrued and unpaid to the Redemption Date and any Additional Amounts payable with respect thereto, unless otherwise specifically provided. "Registered Security" shall mean any Security registered on the books of the Registrar kept for that purpose in accordance with the terms hereof. "Responsible Officer," when used with respect to the Trustee, shall mean any officer in the corporate trust department of the Trustee or any officer of the Trustee customarily performing functions similar to those performed by any officer in the corporate trust department of the Trustee with respect to a particular corporate matter or any other officer to whom any corporate trust matter is referred because of his knowledge of and familiarity with the particular subject. "Restricted Subsidiary" shall mean any Subsidiary of the Company that is not an Unrestricted Subsidiary. 7 14 "Securities" shall mean the debt securities, as amended or supplemented from time to time pursuant to this Indenture, that are issued under this Indenture. "Securities Act" shall mean the Securities Act of 1933, as amended. "Stated Maturity," when used with respect to any Security or any installment of interest thereon, shall mean the date specified in such Security as the fixed date on which the principal of such Security or such installment of interest is due and payable. "Subsidiary" of any Person shall mean (i) any Person of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by any Person or one or more of the Restricted Subsidiaries of that Person or a combination thereof, and (ii) any partnership, joint venture or other Person in which such Person or one or more of the Restricted Subsidiaries of that Person or a combination thereof has the power to control by contract or otherwise the board of directors or equivalent governing body or otherwise controls such entity. "TIA" or "Trust Indenture Act" shall mean the Trust Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb) as in effect on the date of this Indenture, except as provided in Sections 9.1 and 9.3 hereof. "Transfer Agent" shall mean any Person, which may be the Company, authorized by the Company to exchange or register the transfer of Securities. "Trustee" shall mean the party named as such in this Indenture unless a successor replaces it pursuant to the provisions hereunder, and thereafter shall mean such successor. "Unrestricted Subsidiary" shall mean (i) any Subsidiary of the Company that at the time of determination shall be designated an Unrestricted Subsidiary by the Board of Directors in the manner provided below and (ii) any Subsidiary of an Unrestricted Subsidiary. The Board of Directors may designate any Subsidiary of the Company (including any newly-acquired or newly-formed Subsidiary) to be an Unrestricted Subsidiary unless such Subsidiary owns any Capital Stock of, or owns or holds any property of, the Company or any other Subsidiary of the Company that is not a Subsidiary of the Subsidiary so designated; provided, however, that the Subsidiary to be so designated has total assets of $5,000 or less. Any such designation by the Board of Directors shall be evidenced to the Trustee by promptly filing with the Trustee a copy of the Board Resolutions giving effect to such designation and an Officers' Certificate certifying that such designation complied with the foregoing provisions. "U.S. Government Obligations" shall mean securities that are (i) direct obligations of the United States of America for the payment of which its full faith and credit is pledged or (ii) obligations of a person controlled or supervised by and acting as an agency or instrumentality of the United States of America, the payment of which is unconditionally guaranteed as full faith and credit obligation by the United States of America, that, in either case, are not callable or redeemable at the option of the issuer thereof and shall also include a depository receipt issued by a bank or trust 8 15 company as custodian with respect to any such U.S. Government Obligations or a specific payment of interest on or principal of any such U.S. Government Obligations held by such custodian for the account of the holder of a depository receipt; provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt for any amount received by the custodian in respect of the U.S. Government Obligations or the specific payment of interest on or principal of the U.S. Government Obligations evidenced by such depository receipt. "Yield to Maturity" means the yield to maturity on a series of Securities at the most recent redetermination of interest on such series, and calculated in accordance with accepted financial practice. SECTION 1.2 OTHER DEFINITIONS.
Defined in Term Section - ---- ------- "Conversion Price".................................................................. 12.4 "covenant defeasance option"........................................................ 8.1 "Date of Conversion"................................................................ 12.2 "Events of Default"................................................................. 6.1 "Last Sale Price"................................................................... 12.3 "legal defeasance option"........................................................... 8.1 "mandatory sinking fund payment".................................................... 11.1 "optional sinking fund payment"..................................................... 11.1 "Paying Agent"...................................................................... 2.3 "Rights"............................................................................ 12.11 "Registrar" ........................................................................ 2.3 "Sale/Leaseback Transaction"........................................................ 4.8 "Securities Custodian".............................................................. 2.3 "Surviving Entity".................................................................. 5.1 "Trading Day"....................................................................... 12.3
SECTION 1.3 INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT. Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made a part of this Indenture. The following TIA terms used in this Indenture have the following meanings: "indenture securities" means the Securities; "indenture security holder" means a Securityholder; "indenture to be qualified" means this Indenture; "indenture trustee" or "institutional trustee," means the Trustee; and 9 16 "obligor" on the Securities means the Company, any other obligor upon the Securities or any successor obligor upon the Securities. All other terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by Commission rule under the TIA have the meanings so assigned to them. In addition, for purposes of Sections 311(b)(4) and 311(b)(6) of the TIA, the following terms shall have the following meanings: "cash transaction" means any transaction in which full payment for goods or securities sold is made within seven days after delivery of the goods or securities in currency or in checks or other orders drawn upon banks' or bankers' acceptances and payable upon demand. "self-liquidating paper" means any draft, bill of exchange, acceptance or obligation which is made, drawn, negotiated or incurred by the Company for the purpose of financing the purchase, processing, manufacture, shipment, storage or sale of goods, wares or merchandise and which is secured by documents evidencing title to, possession of or a lien upon, the goods, wares or merchandise or the receivables or proceeds arising from the sale of the goods, wares or merchandise previously constituting the security, provided the security is received by the Trustee simultaneously with the creation of the creditor relationship with the Company arising from the making, drawing, negotiating or incurring of the draft, bill of exchange, acceptance or obligation. SECTION 1.4 RULES OF CONSTRUCTION. Unless the context otherwise requires: (1) a term has the meaning assigned to it; (2) an accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP; (3) "or" is not exclusive; (4) words in the singular include the plural and words in the plural include the singular; and (5) provisions apply to successive events and transactions. 10 17 ARTICLE II THE SECURITIES SECTION 2.1 TERMS AND FORMS. The aggregate principal amount of Securities that may be authenticated and delivered under this Indenture is unlimited. The Securities may be issued in one or more series of Securities and shall bear the title, interest, if any, at the rates and from the dates, shall mature at the times, may be redeemable at the prices and upon the terms, shall be denominated and payable at the place or places and in the currency or currencies (which may be other than United States dollars), including composite currencies, and shall contain or be subject to such other terms as shall be approved by or pursuant to a Board Resolution of the Company, which may delegate to one or more officers of the Company the authority to establish the particular terms of any series, including the terms set forth below, or in one or more supplements to this Indenture. The Securities of each series hereunder shall be in one or more forms approved from time to time by or pursuant to a Board Resolution of the Company or in one or more supplements to this Indenture establishing the following: (1) the title or designation of the Securities and the series in which such Securities shall be included (which, unless such Securities constitute part of a series of Securities previously issued, shall distinguish the Securities of the series from all other Securities); (2) any limit upon the aggregate principal amount of the Securities of such title or the Securities of such series which may be authenticated and delivered under this Indenture (except for Securities authenticated and delivered upon registration or transfer of, or in exchange for, or in lieu of, other Securities of the series pursuant to Sections 2.5, 2.6, 2.9, 3.7 or 9.5); (3) whether Securities of the series are to be issuable as Registered Securities, Bearer Securities (with or without coupons) or both; any restrictions applicable to the offer, sale or delivery of Bearer Securities and the terms upon which Bearer Securities of the series may be exchanged for Registered Securities of the series; and whether any Securities of the series are to be issuable initially in global form and, if so, (i) whether beneficial owners of interests in any such global Security may exchange such interest for Securities of such series and of like tenor of any authorized form and denomination and the circumstances under which any such exchanges may occur, if other than in the manner specified in Section 2.9 and (ii) the name of the Depository or the U.S. Depository, as the case may be, with respect to any global Security; (4) the date as of which any Bearer Securities of the series and any temporary global Security representing outstanding Securities of the series shall be dated if other than the date of original issuance of the first Security of the series to be issued; 11 18 (5) if Securities of the series are to be issuable as Bearer Securities, whether interest in respect of any portion of a temporary Bearer Security in global form (representing all of the outstanding Bearer Securities of the series) payable in respect of any date or dates prior to the exchange of such temporary Bearer Security for definitive Securities of the series shall be paid to any clearing organization with respect to the portion of such temporary Bearer Security held for its account and, in such event, the terms and conditions (including any certification requirements) upon which any such interest payment received by a clearing organization will be credited to the Persons entitled to interest payable on such date or dates; (6) the date or dates on which the principal of such Securities is payable; (7) the rate or rates at which such Securities shall bear interest, if any, or the method in which such rate or rates are determined, the date or dates from which such interest shall accrue, the dates on which such interest shall be payable and the record date for Holders entitled to the interest payable on Registered Securities on any such date, whether and under what circumstances Additional Amounts on such Securities shall be payable and, if so, whether the Company has the option to redeem the affected Securities rather than pay such Additional Amounts, and the basis upon which interest shall be calculated if other than as otherwise provided in this Indenture; (8) the place or places, if any, in addition to or other than the Borough of Manhattan, The City of New York, State of New York, where the principal of and interest on or Additional Amounts, if any, payable in respect of such Securities shall be payable; (9) the period or periods within which, the price or prices at which and the terms and conditions upon which such Securities may be redeemed, in whole or in part, at the option of the Company; (10) the obligation, if any, of the Company to redeem or purchase such Securities pursuant to a sinking fund, at the option of a Holder thereof or otherwise and the period or periods within which, the price or prices at which and the terms and conditions upon which such Securities shall be redeemed or purchased in whole or in part, pursuant to such obligation, and any provisions for the remarketing of such Securities; (11) the denominations in which Registered Securities of the series, if any, shall be issuable, and the denominations in which Bearer Securities of the series, if any, shall be issuable, in either case if other than as otherwise provided in this Indenture; 12 19 (12) if other than the principal amount thereof, the portion of the principal amount of such Securities which shall be payable upon declaration of acceleration of the maturity thereof pursuant to Section 6.2; (13) if other than such coin or currency of the United States of America as at the time of payment is legal tender for payment of public or private debts, the coin or currency, including composite currencies, in which payment of the principal of or interest, if any, and any Additional Amounts in respect of such Securities shall be payable and whether the Securities of the series may be discharged other than as provided in Article VIII; (14) if the principal of or interest, if any, and any Additional Amounts in respect of such Securities are to be payable, at the election of the Company or a Holder thereof, in a coin or currency, including composite currencies, other than that in which the Securities are stated to be payable, the period or periods within which, and the terms and conditions upon which, such election may be made; (15) if the amount of payments of principal of or interest, if any, or any Additional Amounts in respect of such Securities may be determined with reference to an index, formula or other method based on a coin or currency other than that in which the Securities are stated to be payable, the manner in which such amounts shall be determined; (16) if the Securities of such series are to be issuable in definitive form (whether upon original issue or upon exchange of a temporary Security of such series) only upon receipt of certain certificates or other documents or satisfaction of other conditions, then the form and terms of such certificates, documents or conditions; (17) any terms which may be related to warrants issued by the Company in connection with, or for the purchase of, Securities of such series, including whether and under what circumstances the Securities of any series may be used toward the exercise price of any such warrants; (18) whether the Securities of the series are to be convertible into shares of common stock or other securities of the Company, and the conversion price, conversion period and any conversion provisions other than as provided in Article XII; (19) any other events of default or covenants with respect to Securities of such series; and (20) any other terms of such Securities to the extent permitted by applicable law (whether or not such terms are inconsistent with the provisions of this Indenture). If the form of the Security of any series is approved by or pursuant to a Board Resolution, an Officers' Certificate delivered to the Trustee shall state that all conditions precedent relating to the authentication and delivery of such Security have been complied with and shall be 13 20 accompanied by a copy of the Board Resolution by or pursuant to which the form of such Security has been approved. The Securities may have notations, legends or endorsements required by law, stock exchange rule, agreements to which the Company is subject or usage (provided that any such notation, legend or endorsement is in a form acceptable to the Company and the Trustee). Each Security shall be dated the date of its authentication. All Securities of any one series and coupons appertaining to Bearer Securities of such series, if any, shall be substantially identical except as to denomination and the rate or rates of interest, if any, the time or times at which the principal thereof may be payable, the date from which interest, if any, shall accrue and except as may otherwise be provided in or pursuant to such Board Resolution and set forth in the Officers' Certificate hereinabove described or in any such indenture supplemental hereto. All Securities of any one series need not be issued at the same time and, unless otherwise provided, a series may be reopened for issuances of additional Securities of such series or to establish additional terms of such series of Securities. The Securities of each series may be issued as Registered Securities without coupons or, if provided by the terms of the instrument establishing such series of Securities, as Bearer Securities, with or without coupons and, in either case, may be issued initially, temporarily or permanently in global form (as provided in Section 2.10). Unless the form of a Security for a series provides otherwise, the Registered Securities shall be issued in denominations of $1,000 or integral multiples thereof and Bearer Securities shall be issuable in the denomination of $5,000. Except as otherwise specified as contemplated by this Section 2.1 for Securities of any series, interest on the Securities of each series shall be computed on the basis of a 360-day year of twelve 30-day months. SECTION 2.2 EXECUTION AND AUTHENTICATION. Two Officers shall sign the Securities and the coupons for the Company by manual or facsimile signature. The Company's seal may be reproduced on the Securities, but the Company's seal shall not be required to be included on the Securities. Coupons shall bear the facsimile signatures of two Officers of the Company. If an Officer whose signature is on a Security or coupon no longer holds that office at the time the Security is authenticated by the Trustee, the Security and coupon shall nevertheless be valid. The aggregate principal amount of Securities outstanding hereunder at any time shall be unlimited except that such outstanding amount (exclusive of any premium) may not exceed the amount authorized from time to time by the Board of Directors of the Company and except as provided in Section 2.6. Upon receipt of a Company Order for the authentication and delivery of Securities of a series, the Trustee shall authenticate and deliver for original issue Securities of a series as to which an Officers' Certificate of the Company or a supplemental indenture has been delivered to the Trustee pursuant to Section 2.1. 14 21 No Security or any coupon appertaining thereto shall be valid until the Trustee or the authenticating agent referred to below manually signs the certificate of authentication on the Security. Each Registered Security shall be dated the date of its authentication. Bearer Securities and any temporary Bearer Security in global form shall be dated as specified in the Officers' Certificate of the Company or in the supplements to this Indenture contemplated by Section 2.1. The signature of the Trustee or the authenticating agent referred to below shall be conclusive evidence that the Security has been authenticated under this Indenture. The Trustee may appoint an authenticating agent reasonably acceptable to the Company to authenticate the Securities. Unless otherwise provided in the appointment, an authenticating agent may authenticate Securities whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such agent. An authenticating agent has the same rights as an Agent to deal with the Company or an Affiliate. Except as permitted by Section 2.6, the Trustee shall not authenticate and deliver any Bearer Security unless all appurtenant coupons for interest then matured have been detached and cancelled. The Trustee's authentication shall be in the following form: This is one of the Securities of the series designated herein and referred to in the within-mentioned Indenture. Dated: The First National Bank of Chicago, as Trustee By: Authorized Signatory If the forms and terms of the Securities of the series and any related coupons have been established in or pursuant to one or more Officers' Certificates as permitted by Section 2.1 and 2.2, in authenticating such Securities and accepting the additional responsibilities under this Indenture relating to such Securities the Trustee shall be entitled to receive, and (subject to Section 7.1) shall be fully protected in relying upon an Opinion of Counsel to the effect that: (a) the form and terms of such Securities and coupons, if any, have been duly authorized and established pursuant to Sections 2.1 and 2.2 and comply with this Indenture, and (b) such Securities, when authenticated and delivered by the Trustee and issued by the Company, and such coupons, if any, when issued by the Company, in the manner and subject to any conditions specified in such Opinion of Counsel will constitute valid and legally binding obligations of the Company, enforceable in accordance with their terms, subject to customary exceptions, 15 22 provided, however, that, with respect to Securities of a series subject to a Periodic Offering, the Trustee shall be entitled to receive such Opinion of Counsel only once at or prior to the time of the first authentication of Securities of such series and that the Opinion of Counsel above may state: (x) that the forms of such Securities have been, and the terms of such Securities (when established in accordance with such procedures as may be specified from time to time in a Company Order, all as contemplated by and in accordance with a Board Resolution or any Officers' Certificate pursuant to Section 2.1, as the case may be) will have been, duly authorized by the Company and established in conformity with the provisions of this Indenture; and (y) that such Securities, together with the coupons, if any, appertaining thereto, when (1) executed by the Company, (2) completed, authenticated and delivered by the Trustee in accordance with this Indenture, and (3) issued by the Company in the manner and subject to any conditions specified in such Opinion of Counsel, will constitute valid and legally binding obligations of the Company, enforceable in accordance with their terms, subject to customary exceptions. With respect to Securities of a series subject to a Periodic Offering, the Trustee may conclusively rely, as to the authorization by the Company of any of such Securities, the form and terms thereof and the legality, validity, binding effect and enforceability thereof, upon the Opinion of Counsel and other documents delivered pursuant to Section 2.1 and this Section 2.2, as applicable, at or prior to the time of the first authentication of Securities of such series unless and until it has received written notification that such opinion or other documents have been superseded or revoked. In connection with the authentication and delivery of Securities of a series subject to a Periodic Offering, the Trustee shall be entitled to assume that the Company's instructions to authenticate and deliver such Securities do not violate any rules, regulations or orders of any governmental agency or commission having jurisdiction over the Company. SECTION 2.3 REGISTRAR, PAYING AGENT, CONVERSION AGENT, DEPOSITORY AND SECURITIES CUSTODIAN. The Company shall maintain an office or agency where Securities may be presented for registration of transfer or for exchange (the "Registrar"), an office or agency including the office or agency maintained by the Company pursuant to Section 4.2 where Securities may be presented for payment (the "Paying Agent") and, if applicable, an office or agency where the Securities may be presented for conversion (the "Conversion Agent"). The Registrar shall keep a register of the Securities and of their transfer and exchange. The Company may appoint one or more co-registrars and one or more additional paying agents or conversion agents. The term "Paying Agent" includes any additional paying agent, and the term "Conversion Agent" includes any additional conversion agent. The Company shall maintain a custodian ("Securities Custodian") with respect to global Securities for so long as global Securities remain outstanding. The Company shall enter into an appropriate agency agreement with any Registrar, Paying Agent, Conversion Agent, Depository, Securities Custodian or co-registrar not a party to this Indenture, which agreement shall implement the provisions of this Indenture that relate to such agent 16 23 and incorporate the terms of the TIA. The Company shall notify the Trustee of the name and address of any such agent. If the Company fails to maintain a Registrar, Paying Agent, Conversion Agent, if applicable, or Securities Custodian, if applicable, the Trustee shall act as such and shall be entitled to appropriate compensation therefor pursuant to Section 7.7. The Company or any of its Subsidiaries may act as Paying Agent, Conversion Agent, Registrar, co-registrar or Transfer Agent. The Company initially appoints the Trustee as Registrar and Paying Agent in connection with the Securities and the Trustee accepts such appointment. SECTION 2.4 SECURITYHOLDER LISTS. The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Securityholders. If the Trustee is not the Registrar, the Company shall furnish to the Trustee at least seven Business Days before each interest payment date (and in all events at intervals of not more than six months) and at such other times as the Trustee may request in writing a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Securityholders. The Company and the Trustee shall otherwise comply with TIA Section 312(a). SECTION 2.5 TRANSFER, REGISTRATION AND EXCHANGE. When a Registered Security is presented at an office or agency maintained for that series pursuant to Section 4.2 in proper form for registration of transfer with a request to register a transfer, the Registrar or co-registrar at that office shall register the transfer as requested. At the option of the Securityholder, Registered Securities of any series may be exchanged upon surrender to the Registrar or a co-registrar for Registered Securities of the same series of like aggregate principal amount, stated maturity and tenor and of other authorized denominations upon surrender at any office or agency maintained for that series pursuant to Section 4.2. If so provided with respect to Securities of a series, at the option of the Holder, Bearer Securities of any such series may be exchanged for Registered Securities of the same series containing identical terms and provisions, of any authorized denominations and aggregate principal amount, upon surrender of the Bearer Securities to be exchanged at any office or agency maintained for that series pursuant to Section 4.2, with all unmatured coupons and all matured coupons in default thereto appertaining. If the Holder of a Bearer Security is unable to produce any such unmatured coupon or coupons or matured coupon or coupons in default, such exchange may be effected if the Bearer Securities are accompanied by payment in funds acceptable to the Company and the Trustee in an amount equal to the face amount of such missing coupon or coupons, or the surrender of such missing coupon or coupons may be waived by the Company and the Trustee if there is furnished to them such security or indemnity as they may require to save each of them and any Paying Agent for that series harmless. If thereafter the Holder of such Security shall surrender to any Paying Agent for that series any such missing coupon in respect of which such a payment shall have been made, such Holder shall be entitled to receive the amount of such payment; provided, however, that except as otherwise provided in Section 4.2, interest represented by coupons shall be payable only upon 17 24 presentation and surrender of those coupons at an office or agency located outside the United States. Notwithstanding the foregoing, in case a Bearer Security of any series is surrendered at any such office or agency maintained for that series pursuant to Section 4.2 in exchange for a Registered Security of the same series and like tenor after the close of business at such office or agency on any record date for the payment of interest and any Additional Amounts thereon and before the opening of business at such office or agency on the relevant payment date therefor, such Bearer Security shall be surrendered without the coupon relating to such payment date or proposed date of payment, as the case may be (or if such coupon is so surrendered with such Bearer Security, such coupon shall be returned to the person so surrendering the Bearer Security), and interest will not be payable on such payment date or proposed date for payment, as the case may be, in respect of the Registered Security issued in exchange for such Bearer Security, but will be payable only to the Holder of such coupon when due in accordance with the provisions of this Indenture. Every Security presented or surrendered for registration of transfer or exchange shall (if so required by the Company or the Registrar or co-registrar) be duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the Company and the Registrar duly executed by the Holder thereof or his attorney duly authorized in writing. To permit transfers and exchanges, the Company shall execute and the Trustee shall authenticate Securities at the Registrar's or co-registrar's request. Notwithstanding the foregoing, except as otherwise specified as contemplated by Section 2.1, any global Security shall be exchangeable only if (i) the Depository or U.S. Depository, as applicable, is at any time unwilling, unable or ineligible to continue as Securities Depository and a successor Depository, or U.S. Depository as applicable, is not appointed by the Company within 90 days of the date the Company is so informed in writing, (ii) the Company executes and delivers to the Trustee a Company Order to the effect that such global Security shall be so exchangeable, or (iii) an Event of Default has occurred and is continuing with respect to the Securities. If the beneficial owners of interests in a global Security are entitled to exchange such interests for Securities of such series and of like tenor and principal amount of any authorized form and denomination, as specified as contemplated by Section 2.1, then without unnecessary delay but in any event not later than the earliest date on which such interests may be so exchanged, the Company shall deliver to the Trustee definitive Securities of that series in aggregate principal amount equal to the principal amount of such global Security, executed by the Company. On or after the earliest date on which such interests may be so exchanged, such global Securities shall be surrendered from time to time by the U.S. Depository or such other Depository as shall be specified in the Company Order with respect thereto, and in accordance with instructions given to the Trustee and the U.S. Depository or such other Depository, as the case may be, which instructions shall be in writing but need not be accompanied by an Officers' Certificate of the Company or an Opinion of Counsel, as shall be specified in the Company Order with respect thereto to the Trustee, as the Company's agent for such purpose, to be exchanged, in whole or in part, for definitive Securities of the same series without charge. The Trustee shall authenticate and make available for delivery, in exchange for each portion of such surrendered global Security, a like aggregate principal amount of definitive Securities of the same series of authorized denominations and of like tenor as the portion of such global Security to be exchanged which shall be in the form of Bearer Securities or Registered Securities, or any combination thereof, as shall be specified by the beneficial owner thereof (unless the Securities of the series are not issuable both as Bearer Securities and as Registered Securities, in which case the definitive Securities exchanged for the global Security 18 25 shall be issuable only in the form in which the Securities are issuable, as specified as contemplated by Section 2.1); provided, however, that no such exchanges may occur (a) for a period of 15 days next preceding the 15th day of any selection of Securities of that series to be redeemed; pursuant to Section 3.3, or to exchange any Securities of a series selected, called or being called for redemption in whole or in part except in the case of any Security to be redeemed in part, the portion thereof not so to be redeemed; and provided, further, that (unless otherwise specified as contemplated by Section 2.1) no Bearer Security delivered in exchange for a portion of a global Security shall be mailed or otherwise delivered to any location in the United States. Promptly following any such exchange in part, such global Security shall be returned by the Trustee to the U.S. Depository or such other Depository referred to above in accordance with the instructions of the Company referred to above. If a Registered Security is issued in exchange for any portion of a global Security after the close of business at the office or agency where such exchange occurs on any record date for the payment of interest or any Additional Amounts thereon, and before the opening of business at such office or agency on the relevant payment date therefor, interest and any Additional Amounts in respect of such Registered Security will not be payable on such payment date, but will be payable on such payment date only to the Person to whom interest or any Additional Amounts in respect of such portion of such global Security is payable in accordance with the provisions of this Indenture. No service charge shall be made 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 2.9 or 9.5 not involving any transfer. The Company shall not be required (a) to issue, register the transfer of, or exchange any Securities of any series for a period of 15 days next preceding the day of any selection of Securities of such series to be redeemed pursuant to Section 3.3, or (b) to register the transfer of or exchange any Securities of any series selected, called or being called for redemption in whole or in part except, in the case of any Registered Security to be redeemed in part, the portion thereof not so to be redeemed or (c) to exchange any Bearer Security so selected for redemption except, to the extent provided with respect to Securities of a series, that such a Bearer Security may be exchanged for a Registered Security of that series, provided that such Registered Security shall be immediately surrendered for redemption with written instruction for payment consistent with the provisions of this Indenture. 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 endorsed thereon surrendered upon such registration of transfer or exchange. SECTION 2.6 REPLACEMENT SECURITIES. If the Holder of a mutilated or defaced Security or a Security with a mutilated or defaced coupon appertaining to it surrenders such Security to the Trustee or if the Holder of a Security presents evidence to the satisfaction of the Company and the Trustee of the destruction, loss or theft of the Security or the destruction, loss or theft of a coupon and surrenders the Security to 19 26 which such coupon appertains with all appurtenant coupons not so lost, stolen or wrongfully taken, the Company shall issue and the Trustee shall authenticate a replacement Security of the same series and of like tenor, with coupons corresponding to the coupons, if any, appertaining to the surrendered Security, if the requirements set forth in the next succeeding paragraph are met. If required by the Trustee or the Company, an indemnity bond must be supplied by the Holder that is sufficient in the judgment of the Trustee and the Company to protect the Company, the Trustee, any Agent or any authenticating agent from any loss which any of them may suffer if a Security is replaced. Upon the issuance of any substitute Security, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) connected therewith. In case any Security or coupon which has matured or is about to mature or has been called for redemption in full shall become mutilated or defaced or be destroyed, lost or stolen, the Company may, instead of issuing a substitute Security or coupon, pay or authorize the payment of the same (without surrender thereof except in the case of a mutilated or defaced Security or coupon); provided, however, that the applicant for such payment shall furnish to the Company and to the Trustee and any agent of the Company or the Trustee such security or indemnity as any of them may require to save each of them harmless, and, in every case of destruction, loss or theft, the applicant shall also furnish to the Company and the Trustee and any agent of the Company or the Trustee evidence to their satisfaction of the destruction, loss or theft of such Security or coupon and of the ownership thereof. Every substitute Security of any series, with coupons, if any, issued pursuant to the provisions of this Section 2.6 by virtue of the fact that any Security is destroyed, lost or stolen or that a coupon appertaining to it is destroyed, lost or stolen shall constitute an additional contractual obligation of the Company, whether or not the destroyed, lost or stolen Security or coupon shall be at any time enforceable by anyone and shall be entitled to all the benefits of (but shall be subject to all the limitations of rights set forth in) this Indenture equally and proportionately with any and all other Securities duly authenticated and delivered hereunder. All Securities shall be held and owned upon the express condition that, to the extent permitted by the law, the foregoing provisions are exclusive with respect to the replacement or payment of mutilated, defaced, destroyed, lost or stolen Securities and shall preclude any and all other rights or remedies notwithstanding any law or statute existing or hereafter enacted to the contrary with respect to the replacement or payment of negotiable instruments or other securities without their surrender. SECTION 2.7 OUTSTANDING SECURITIES. The Securities of any series outstanding at any time are all the Securities of such series authenticated and delivered by the Trustee except for those cancelled by it, those delivered to it for cancellation, those described in this Section as not outstanding and in the case of any global Securities, the principal amount by which such global Securities have been reduced by the Trustee or the Securities custodian in accordance with this Indenture. If any Security is replaced or paid pursuant to Section 2.6, it ceases to be outstanding unless the Trustee and the Company receive proof satisfactory to them that the replaced Security is held by a bona fide purchaser. 20 27 If the principal amount of any Security is considered paid under Section 4.1 or 8.1, it ceases to be outstanding and interest on it ceases to accrue. If the Paying Agent segregates and holds in trust, in accordance with this Indenture, on a Redemption Date or maturity date money sufficient to pay all principal and interest payable on that date with respect to the Securities of a particular series (or portions thereof) to be redeemed or maturing, as the case may be (and in the case of any Security which is to be redeemed prior to the Maturity thereof, notice of such redemption has been duly given or provision satisfactory to the Trustee has been made for giving such notice), and the Paying Agent is not prohibited from paying such money to Securityholders on that date pursuant to the terms of this Indenture, then on and after that date such Securities of that series (or portions thereof) cease to be outstanding and interest on them ceases to accrue. If any Security is cancelled by the Trustee or delivered to the Trustee for cancellation, it ceases to be outstanding and interest on it ceases to accrue. A Security of any series does not cease to be outstanding because the Company or an Affiliate holds such Security, except as otherwise provided in Section 2.8 hereof. In determining whether the Holders of the requisite principal amount of outstanding Securities of any or all series have given any request, demand, authorization, direction, notice, consent or waiver hereunder, (i) the principal amount of an Original Issue Discount Security that shall be deemed to be outstanding for such purposes shall be the amount of the principal thereof that would be due and payable as of the date of such determination upon a declaration of acceleration of the maturity thereof pursuant to Section 6.1 and (ii) the principal amount of a Security denominated in a foreign currency or currencies, of the principal amount (or, in the case of an Original Issue Discount Security, the United States dollar equivalent, determined pursuant to Section 13.15, of such Security of the amount determined as provided in (i) above) of such Security. SECTION 2.8 TREASURY SECURITIES. In determining whether the Holders of the required principal amount of Securities (in the aggregate or with respect to a particular series, in each case only as expressly provided herein) have concurred in any direction, waiver or consent, any Securities owned by the Company or an Affiliate shall be disregarded (including for purposes of determining the outstanding principal amount of Securities or any series of Securities) except that for the purposes of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent only Securities which the Trustee knows are so owned shall be so disregarded. SECTION 2.9 TEMPORARY SECURITIES. Until definitive Securities are ready for delivery, the Company may prepare and the Trustee shall authenticate temporary Securities upon receipt of the written order of the Company signed by two Officers. Temporary Securities and, if Bearer Securities, temporary coupons shall be substantially in the form of definitive Securities and, if Bearer Securities, definitive coupons, but may have variations that the Company considers appropriate for temporary Securities. Without 21 28 unreasonable delay, the Company shall prepare and the Trustee, upon receipt of the written order of the Company signed by two Officers, shall authenticate definitive Securities in exchange for temporary Securities. Until such exchange, temporary Securities shall be entitled to the same rights, benefits and privileges as definitive Securities. SECTION 2.10 SECURITIES IN GLOBAL FORM. If Securities of a series are issuable in global form, any such Security may provide that it shall represent the aggregate amount of outstanding Securities from time to time endorsed thereon and may also provide that the aggregate amount of outstanding Securities represented thereby may from time to time be reduced to reflect exchanges. Any endorsement of a Security in global form to reflect the amount, or any increase or decrease in the amount or changes in the rights of Holders, of outstanding Securities represented thereby shall be made in such manner and by such Person or Persons as shall be specified therein. SECTION 2.11 CANCELLATION. The Company at any time may deliver Securities or coupons to the Trustee for cancellation. The Registrar and the Paying Agent shall forward to the Trustee any Securities surrendered to them for registration of transfer, exchange or payment and any coupons surrendered for payment. The Trustee shall cancel all Securities surrendered for registration of transfer, exchange, payment replacement or cancellation and all coupons surrendered for payment and shall cancel such Securities in accordance with the usual procedures of the Trustee and deliver such cancelled Securities to the Company upon written order signed by two Officers of the Company. The Company may not issue new Securities to replace Securities that it has redeemed or paid or that have been delivered to the Trustee for cancellation. SECTION 2.12 DEFAULTED INTEREST. If the Company defaults in a payment of interest or any Additional Amounts on any series of Registered Securities, and so long as the Trustee deems the following procedure practicable, the Company shall pay the defaulted interest and any Additional Amounts to Persons who are Holders of Registered Securities of such series on a subsequent special record date in the following manner. The Company shall fix the special record date (which shall be at least five days before the payment date) for the payment of such defaulted interest and any Additional Amounts on such Securities and the payment date for such defaulted interest. At least 15 days before the special record date, the Company (or the Trustee) shall mail each Holder of Registered Securities a notice that states the special record date, the payment date and the amount of defaulted interest and any Additional Amounts to be paid, provided the Company has made arrangements satisfactory to the Trustee for payment of the aggregate amount to be paid on such payment date. On such payment date the Trustee shall pay out of funds provided by the Company such defaulted interest and any Additional Amounts. In case a Bearer Security of any series is surrendered at the office or agency of the Company maintained pursuant to Section 4.2 in a Place of Payment for such series in exchange for a Registered Security of such series after the close of business at such office or agency on any special record date and before the opening of business at such office or agency on the related proposed date for payment of defaulted interest and any Additional Amounts, such Bearer Security shall be 22 29 surrendered without the coupon relating to such proposed date of payment and defaulted interest and any Additional Amounts will not be payable on such proposed date of payment in respect of the Registered Security issued in exchange for such Bearer Security, but will be payable only to the Holder of such coupon on or after such payment date in accordance with the provisions of this Indenture. The Company may pay defaulted interest and any Additional Amounts in any other lawful manner. SECTION 2.13 PERSONS DEEMED OWNERS. Prior to due presentment of a Registered Security for registration of transfer, the Company, the Trustee and any Agent may deem and treat the Person in whose name any Security shall be registered upon the register of Securities kept by the Registrar as the absolute owner of such Registered Security (whether or not such Security shall be overdue and notwithstanding any notation of the ownership or other writing thereon made by anyone other than the Company, any Registrar or co-registrar) for the purpose of receiving payments of principal of, interest on or any Additional Amounts payable with respect to such Registered Security and for all other purposes whatsoever and neither the Company, the Trustee nor any Agent shall be affected by any notice to the contrary. The Company, the Trustee and any agent of the Company or the Trustee may treat the bearer of any Bearer Security and the bearer of any coupon as the absolute owner of such Security or coupon for the purpose of receiving payment thereof or on account thereof and for all other purposes whatsoever, whether or not such Security or coupon shall 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 2.14 CUSIP NUMBERS. The Company in issuing the Securities may use "CUSIP" numbers (if then generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices of redemption as a convenience to Holders; provided that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Securities or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Securities, and any such redemption shall not be affected by any defect in or omission of such numbers. The Company will promptly notify the Trustee of any change in the "CUSIP" numbers. ARTICLE III REDEMPTION SECTION 3.1 APPLICABILITY OF ARTICLE. This Article shall apply to the Securities of each series, if any, that by their terms are subject to redemption at the option of the Company or pursuant to the operation of a sinking fund or otherwise are required to be redeemed pursuant to the terms of the Securities. If the terms of any Security shall conflict with any provision of this Article III, the terms of such Security shall govern. 23 30 SECTION 3.2 NOTICES TO TRUSTEE. If the Company elects to redeem Securities pursuant to the optional redemption provisions, if any, set forth in such Securities, it shall furnish to the Trustee an Officers' Certificate setting forth the paragraph of the Securities of the applicable series pursuant to which the redemption shall occur, the Redemption Date, the principal amount of Securities to be redeemed and the Redemption Price. If Securities of any series by their terms are redeemable pursuant to the operation of a sinking fund or pursuant to another mandatory redemption provision of the Securities, the Company shall notify the Trustee by an Officers' Certificate of the amount of the next sinking fund payment or amount required to satisfy such mandatory redemption payment and the portion of such payment which is to be satisfied by delivering and crediting Securities of the same series pursuant to Section 3.6. If the Company elects to reduce pursuant to the terms of such Securities the principal amount of Securities to be redeemed, it shall notify the Trustee by Officers' Certificate of the amount of the reduction and the basis for it. If the Company elects to credit against any such redemption Securities of the same series it has not previously delivered to the Trustee for cancellation, it shall deliver the Securities with such Officers' Certificate. The Company shall give each notice or Officers' Certificate provided for in this Section at least 45 days (unless a shorter period shall be satisfactory to the Trustee or a longer period required by Section 3.4) but not more than 60 days before the applicable Redemption Date. If the Registrar is not the Trustee, the Company shall, concurrently with each notice of redemption or repurchase, cause the Registrar to deliver to the Trustee a certificate (upon which the Trustee may rely) setting forth the principal amounts of Securities held by each Holder. SECTION 3.3 SELECTION OF SECURITIES TO BE REDEEMED. If less than all of the Securities of a series are to be redeemed, the Trustee shall select the Securities to be redeemed on a pro rata basis, by lot or by such method as the Trustee shall deem fair and appropriate. In the event of partial redemption by lot, the particular Securities of a series to be redeemed shall be selected, unless otherwise provided herein, not less than 30 nor more than 60 days prior to the Redemption Date by the Trustee from the outstanding Securities not previously called for redemption. The Trustee shall promptly notify the Company in writing of the Securities selected for redemption and, in the case of any Security selected for partial redemption, the principal amount thereof to be redeemed. Securities and portions of Securities selected shall be in amounts of $1,000 or whole multiples of $1,000; except that if all of the Securities of a Holder are to be redeemed, the entire outstanding amount of Securities held by such Holder, even if not a multiple or $1,000, shall be redeemed. Except as provided in the preceding sentence, provisions of this Indenture that apply to Securities called for redemption also apply to portions of Securities called for redemption. 24 31 SECTION 3.4 NOTICE OF REDEMPTION. The Company shall give notice of a redemption at least 30 days but not more than 60 days before the Redemption Date, with respect to Registered Securities, by mailing a notice of redemption to each Holder of Registered Securities of such series to be redeemed at such Holder's address as it appears on the Securities register maintained by the Registrar and, with respect to Bearer Securities, by publishing in an Authorized Newspaper notice of such redemption on two separate days. The notice shall identify the Securities to be redeemed and shall state: (1) the Redemption Date; (2) the Redemption Price; (3) the name and address of the Paying Agent; (4) that Securities called for redemption must be surrendered to the Paying Agent to collect the Redemption Price; (5) the paragraph of the Securities pursuant to which the Securities called for redemption are being redeemed; (6) that, unless the Company defaults in making the redemption payment, interest on Securities called for redemption ceases to accrue on and after the Redemption Date and the only remaining right of the Holders of such Securities is to receive payment of the Redemption Price upon surrender to the Paying Agent of the Securities to be redeemed; (7) if any Security is to be redeemed in part, the portion of the principal amount (equal to $1,000 or any integral multiple thereof) of such Security to be redeemed and that, on or after the Redemption Date, upon surrender of such Security, a new Security or Securities of the same series in aggregate principal amount equal to the unredeemed portion thereof will be issued without charge to the Securityholder; (8) if less than all of the Securities of a series are to be redeemed, the identification of the particular Securities of such series (or portion thereof) to be redeemed, as well as the aggregate principal amount of Securities of such series to be redeemed and the aggregate principal amount of Securities of such series estimated to be outstanding after such partial redemption; and (9) the CUSIP number, if any. At the Company's request, the Trustee shall give the notice of redemption in the name and at the expense of the Company. In such event, the Company shall provide the Trustee with the 25 32 information required by this Section and shall provide notice of such redemption to the Trustee at least 45 days prior to the Redemption Date (unless a shorter period shall be satisfactory to the Trustee). If such notice is given by the Company, the Company shall provide a copy of such notice given to the Holders to the Trustee and any Paying Agent at least 2 days prior to the date such notice is given to such Holders, but in any event at least 15 days prior to the Redemption Date (unless a shorter period shall be satisfactory to the Trustee). SECTION 3.5 EFFECT OF NOTICE OF REDEMPTION. Once notice of redemption is mailed, Securities of the series called for redemption become due and payable on the Redemption Date at the Redemption Price. Upon surrender to any Paying Agent, such Securities shall be paid at the Redemption Price, plus accrued interest to the Redemption Date and any Additional Amounts with respect thereto; provided, however, that installments of interest whose Stated Maturity is on or prior to the Redemption Date shall be payable, in the case of Bearer Securities, to bearers of the coupons for such interest and Additional Amounts upon surrender thereof and, in the case of Registered Securities, to the Holders of such series of Securities, registered as such, at the close of business on the relevant record date for the payment of such installment of interest and Additional Amounts. Notice of redemption shall be deemed to be given when mailed or published, as the case may be, whether or not the Holder receives the notice. In any event, failure to give such notice, or any defect therein, shall not affect the validity of the proceedings for the redemption of the Securities. If any Bearer Security surrendered for redemption shall not be accompanied by all appurtenant coupons maturing after the Redemption Date, such Security may be paid after deducting from the Redemption Price an amount equal to the face amount of all such missing coupons, or the surrender of each missing coupon or coupons may be waived by the Company and the Trustee if there shall be furnished to them such security or indemnity as they may require to save each of them and any Paying Agent for such Security harmless. If thereafter the Holder of such Security shall surrender to the Trustee or any Paying Agent for such Security any such missing coupon in respect of which a deduction shall have been made from the Redemption Price, such Holder shall be entitled to receive the amount so deducted; provided, however, that interest (and any Additional Amounts) represented by coupons shall be payable only upon presentation and surrender of these coupons at an office or agency located outside of the United States except as otherwise provided in Section 4.2. SECTION 3.6 DEPOSIT OF REDEMPTION PRICE. At least one Business Day prior to the Redemption Date, the Company shall irrevocably deposit with the Trustee or with the Paying Agent (or if the Company or a Subsidiary of the Company is acting as the Paying Agent, set aside, segregate and hold in trust, as provided herein) in immediately available funds money sufficient to pay the Redemption Price of and accrued and unpaid interest on all Securities to be redeemed on that date. If the Company complies with the preceding paragraph, interest on the Securities to be redeemed will cease to accrue on the applicable Redemption Date, whether or not such Securities are presented for payment. If any Security called for redemption shall not be so paid upon surrender for 26 33 redemption because of the failure of the Company to comply with the preceding paragraph, interest will be paid on the unpaid principal, from the Redemption Date until such principal is paid, and, to the extent lawful, on any interest not paid on such unpaid principal, in each case at the rate provided in the Securities for the applicable series. If any Security by its terms permits any sinking fund payment obligation to be satisfied by delivering and crediting Securities, the Company shall deliver such Securities to the Trustee for crediting against such payment obligation in accordance with the terms of such Securities and this Indenture. SECTION 3.7 SECURITIES REDEEMED IN PART. Upon surrender of a Security that is redeemed in part, the Company shall issue and the Trustee shall authenticate for the Holder at the expense of the Company a new Security of the same series equal in principal amount to the unredeemed portion of the Security surrendered. If a Security in global form is surrendered upon redemption in part, the Company shall execute, and the Trustee shall authenticate and deliver to the U.S. Depository or other Depository for such Security in global form as shall be specified in the Company Order to the Trustee with respect thereto, without service charge, a new Security in global form in a denomination equal to and in exchange for the unredeemed portion of the principal of the Security in global form so surrendered. ARTICLE IV COVENANTS Subject to the provisions of Section 8.1, so long as Securities are outstanding hereunder, the Company covenants for the benefit of the Securityholders that: SECTION 4.1 PAYMENT OF SECURITIES. The Company will punctually pay the principal of, interest and Additional Amounts, if any, on the Securities on the dates and in the manner provided in the Securities, any coupons appertaining thereto and this Indenture. Principal, interest and any Additional Amounts shall be considered paid on the date due if the Paying Agent (other than the Company or any of its Subsidiaries) holds on that date money sufficient to pay all principal, interest and any Additional Amounts then due. Any interest due on and any Additional Amounts payable in respect of Bearer Securities on or before their maturity, in respect of the principal of such a Security, shall be payable only upon presentation and surrender of the several coupons for such interest installments as are evidenced thereby as they severally mature. The Company shall pay interest on overdue principal and, to the extent lawful, interest on overdue installments of interest or Additional Amounts, if any, at the rate borne by such Securities. 27 34 In case a Bearer Security of any series is surrendered in exchange for a Registered Security of such series after the close of business (at an office or agency in a Place of Payment for such series) on any record date established to determine the Person to whom interest or any Additional Amounts are payable on the next following interest payment date therefor and before the opening of business (at such office or agency) on such interest payment date, such Bearer Security shall be surrendered without the coupon relating to such interest payment date, and interest will not be payable on such interest payment date in respect of the Registered Security issued in exchange of such Bearer Security, but will be payable only to the Holder of such coupon when due in accordance with the provisions of this Indenture. SECTION 4.2 MAINTENANCE OF OFFICE OR AGENCY FOR NOTICES AND DEMANDS. The Company shall maintain in each Place of Payment for any series of Securities an office or agency where Securities of that series (but not Bearer Securities, except as otherwise provided below, unless such Place of Payment is located outside the United States) may be presented or surrendered for payment, where Securities of that series may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Company in respect of the Securities of that series and this Indenture may be served. If Securities of a series are issuable as Bearer Securities, the Company shall maintain, subject to any laws or regulations applicable thereto, an office or agency in a Place of Payment for such series that is located outside the United States where Securities of such series and the related coupons may be presented and surrendered for payment (including payment of any Additional Amounts payable on Securities of such series); provided, however, that if the Securities of such series are listed on The International Stock Exchange of the United Kingdom and the Republic of Ireland Limited or the Luxembourg Stock Exchange or any other stock exchange located outside the United States and such stock exchange shall so require, the Company will maintain a Paying Agent in London, Luxembourg or any other city so required located outside the United States, as the case may be, so long as the Securities of such series are listed on such exchange. 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, except that Bearer Securities of that series and the related coupons may be presented and surrendered for payment (including payment of any Additional Amounts payable on Bearer Securities of that series) at the place specified for that purpose pursuant to Section 2.1. Except as otherwise provided in the form of Bearer Security of any particular series pursuant to the provisions of this Indenture, no payment of principal or interest or Additional Amounts on Bearer Securities shall be made at any office or agency of the Company in the United States or by check mailed to any address in the United States or by transfer to an account maintained with a bank located in the United States; provided, however, payment of principal of and interest in U.S. dollars (including Additional Amounts payable in respect thereof) on any Bearer Security may be made at the office of the Paying Agent in the Borough of Manhattan, The City of New York, State of New York if (but only if) payment of the full amount of such principal, interest or Additional 28 35 Amounts at all offices outside the United States maintained for that purpose by the Company in accordance with this Indenture is illegal or effectively precluded by exchange controls or other similar restrictions. The Company may from time to time designate one or more other offices or agencies where the Securities of one or more series 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 each Place of Payment for Securities of any series 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 4.3 MONEY FOR SECURITIES PAYMENTS TO BE HELD IN TRUST. If the Company shall at any time act as its own Paying Agent with respect to any series of Securities, it shall, on or before each due date of the principal of, or interest or Additional Amounts on, any of the Securities of that series, segregate and hold in trust for the benefit of the Person entitled thereto a sum sufficient to pay the principal or interest or Additional Amounts so becoming due until such sums shall be paid to such Persons or otherwise disposed of as herein provided and shall promptly notify the Trustee of its action or failure so to act. Whenever the Company shall have one or more Paying Agents for any series of Securities, it will, on or prior to each due date of the principal of, or interest or Additional Amounts on, any Securities of that series, deposit with any Paying Agent a sum sufficient to pay the principal or interest and Additional Amounts so becoming due, such sum to be held in trust for the benefit of the Persons entitled to such principal, interest or Additional Amounts, and (unless such Paying Agent is the Trustee) the Company shall promptly notify the Trustee of its action or failure so to act. The Company shall cause each Paying Agent for any series of Securities 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 shall: (1) hold all sums held by it for the payment of the principal of or interest or any Additional Amounts on Securities of that series in trust for the benefit of the Persons entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as herein provided; (2) give the Trustee notice of any Default by the Company in the making of any payment of principal or interest or any Additional Amounts on the Securities of that series; and (3) at any time during the continuance of any such Default, upon the written request of the Trustee, forthwith pay to the Trustee all sums so held in trust by such Paying Agent. 29 36 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 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 terms 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. Except as otherwise provided in the form of Securities of any particular series pursuant to the provisions of this Indenture, 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 or interest or any Additional Amounts on any Security of any series and remaining unclaimed for two years after such principal or interest has or Additional Amounts have become due and payable shall be paid to the Company upon receipt of a Company Order to that effect or (if then held by the Company) shall be discharged from such trust; and the Holder of such Security or any coupon appertaining thereto shall thereafter, as an unsecured general creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof, shall thereupon 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 an Authorized Newspaper in each Place of Payment, or to be mailed to Holders of Registered Securities, or both, 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 or mailing nor shall be later than one year after such principal or interest or Additional Amount has become due and payable, any unclaimed balance of such money then remaining shall be repaid to the Company. SECTION 4.4 COMMISSION REPORTS; REPORTS TO TRUSTEE; REPORTS TO HOLDERS. So long as any Security is outstanding, the Company will: (a) file with the Trustee, within 15 days after the Company is required to file the same with the Commission, copies of the annual reports and of the information, documents and other reports which the Company may be required to file with the Commission pursuant to Section 13 or Section 15(d) of the Exchange Act (or copies of such portions thereof as may be prescribed by the Commission by rules and regulations); or, if the Company is not required to file with the Commission information, documents or reports pursuant to either Section 13 or Section 15(d) of the Exchange Act, then the Company will file with the Trustee and mail to the Holders of the Securities, as the names and addresses of such Holders appear upon the register of Securities, (i) annual reports containing the information required by the Exchange Act to be contained in an Annual Report on Form 10-K, (ii) quarterly reports containing the information required by the Exchange Act to be contained in a Quarterly Report on Form 10-Q and (iii) promptly after the occurrence of an event required to be therein reported, such other reports containing information required by the Exchange Act to be contained in a Current Report on Form 8-K. (b) file with the Trustee and the Commission, in accordance with the rules and regulations prescribed from time to time by the Commission, such additional information, documents and reports with respect to compliance by the Company with the conditions and covenants provided 30 37 for in this Indenture as may be required by such rules and regulations, including, in the case of annual reports, if required by such rules and regulations, certificates or opinions of independent public accountants, conforming to the requirements of Sections 13.4 and 13.5, as to compliance with conditions or covenants, compliance with which is subject to verification by accountants; and (c) mail to the Holders of the Registered Securities, as the names and addresses of such Holders appear upon the register of Securities, in the manner and to the extent provided in Section 7.6, such additional summaries of any information, documents and reports required to be filed with the Trustee pursuant to the provisions of paragraphs (a) and (b) of this Section 4.4 as may be required to be provided to such Holders by the rules and regulations of the Commission under the provisions of the TIA. Delivery of such reports, information and documents to the Trustee is for informational purposes only and the Trustee's receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company's compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officers' Certificates). SECTION 4.5 COMPLIANCE CERTIFICATES. Within 60 days after the close of each fiscal quarter of the Company ending after the date hereof, the Company shall deliver to the Trustee a statement signed by the Chairman of its Board of Directors, or its Vice Chairman or its President or any Vice President and by the Treasurer or any Assistant Treasurer or the Secretary or any Assistant Secretary of the Company (provided that one of such signatories shall be the Company's principal executive officer, principal financial officer or principal accounting officer), stating that in the course of the performance by the signers of their duties as Officers of the Company they would normally obtain knowledge of any Default by the Company and whether or not they have obtained knowledge of any such Default, and, if so, specifying each such Default of which the signers have knowledge and the nature thereof and what action the Company is taking or proposes to take with respect thereto. The Company shall also comply with TIA Section 314(a)(4). SECTION 4.6 CORPORATE EXISTENCE. Subject to the provisions of Article V, the Company will do or cause to be done all things necessary to and will cause each of its Restricted Subsidiaries to preserve and keep in full force and effect its corporate existence, material rights (charter and statutory) and franchises of the Company and each of its Restricted Subsidiaries; provided, however, that the Company shall not be required to preserve any such material right or franchise or the corporate existence of any of its Subsidiaries if (a) the preservation thereof is no longer desirable in the conduct of the business of the Company or such Subsidiary and (b) the loss thereof is not disadvantageous in any material respect to the Holders of the Securities. 31 38 SECTION 4.7 LIMITATION ON LIENS. Subject to the provisions of Article VIII (to the extent they are applicable to the Securities of any series) the Company will not, and will not permit any of its Restricted Subsidiaries to, create, incur or otherwise cause or suffer to exist or become effective any Liens of any kind upon any Principal Property or any shares of stock or debt of any Restricted Subsidiary now owned or hereafter acquired, unless all payments due under this Indenture and the Securities are secured on an equal and ratable basis with the obligation so secured until such time as such obligation is no longer secured by a Lien, except for Permitted Liens. The covenant contained in this section will be subject to the provision for exempted indebtedness in Section 4.9. SECTION 4.8 LIMITATIONS ON SALE AND LEASEBACK TRANSACTIONS. Subject to the provisions of Article VIII (to the extent they are applicable to the Securities of any series), the Company will not, nor will it permit any Restricted Subsidiary to, enter into any arrangement with any Person providing for the leasing by the Company or any Restricted Subsidiary of any Principal Property (whether such Principal Property is now owned or hereafter acquired), except for temporary leases for a term, including any renewal, of not more than five years and except for leases between the Company and a Restricted Subsidiary or between Restricted Subsidiaries, which Principal Property has been or is to be sold or transferred by the Company or such Restricted Subsidiary to such Person (hereinafter, a "Sale and Lease-Back Transaction"), unless either (i) the Company or such Restricted Subsidiary would be entitled, in accordance with the provisions of Section 4.7 (other than provisions with respect to exempted Indebtedness), to incur Indebtedness secured by a Lien on such property without equally and ratably securing the Securities, or (ii) the Company within 180 days after the effective date of the Sale and Lease-Back Transaction applies an amount equal to the Value of such transaction to the voluntary retirement of its Funded Debt. For the purposes of this Article, "Value" shall mean an amount equal to the greater of the net proceeds of the sale or transfer of the property leased pursuant to such Sale and Lease-Back Transaction, or the fair value as determined by the Board of Directors of the leased property at the time of entering into such Sale and Lease-Back Transaction. For the purposes of this Article, "Funded Debt" shall mean indebtedness (including Securities) maturing by the terms thereof more than one year after the original creation thereof. The covenant contained in this Section will be subject to the provision for exempted indebtedness in Section 4.9. SECTION 4.9 EXEMPTED INDEBTEDNESS. Notwithstanding the provisions contained in Sections 4.7 and 4.8, the Company and its Restricted Subsidiaries may issue, assume, suffer to exist or guarantee Indebtedness which would otherwise be subject to the limitation of Section 4.7, without securing the Securities, or may enter into Sale and Lease-Back Transactions which would otherwise be subject to the limitation of Section 4.8, without retiring Funded Debt, or enter into a combination of such transactions, if the sum of (i) the principal amount of all such Debt incurred after the date hereof, and which would otherwise 32 39 be or have been prohibited by the limitations of Section 4.7 or 4.8 and (ii) the aggregate Value of all such Sale and Lease-Back Transactions after the date hereof does not at any such time exceed 15% of the consolidated total assets of the Company and its consolidated Subsidiaries as shown in the most recent audited consolidated balance sheet contained in the latest annual report to the stockholders of the Company. SECTION 4.10 WAIVER OF STAY; EXTENSION OF USURY LAWS. The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law or any usury law or other law that would prohibit or forgive the Company from paying all or any portion of the principal of, or interest on or any Additional Amounts payable with respect to the Securities as contemplated herein or in the Securities, wherever enacted, now or at any time hereafter in force, or that may affect the covenants or the performance of this Indenture; and (to the extent that it may lawfully do so) the Company 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 V SUCCESSORS SECTION 5.1 WHEN COMPANY MAY MERGE, ETC. The Company will not consolidate or merge with or into, or sell, lease, convey or otherwise dispose of all or substantially all of its assets in one transaction or a series of related transactions or assign any of its obligations under this Indenture or the Securities to, any Person unless: (a) the entity formed by or surviving any such consolidation or merger (if other than the Company), or to which such sale, lease, conveyance or other disposition or assignment shall have been made (the "Surviving Entity"), is a corporation organized and existing under the laws of the United States, any state thereof or the District of Columbia; (b) the Surviving Entity assumes by a supplemental indenture in a form satisfactory to the Trustee all of the obligations of the Company under the Securities and this Indenture; and (c) immediately after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing. The Company shall deliver to the Trustee prior to the consummation of the proposed transaction an Officers' Certificate to the foregoing effect and an Opinion of Counsel stating that the proposed transaction and such supplemental indenture comply with this Indenture. 33 40 SECTION 5.2 SUCCESSOR CORPORATION SUBSTITUTED. Upon any consolidation or merger, or any sale, lease, conveyance or other disposition of all or substantially all of the assets of the Company or any assignment of its obligations under this Indenture or the Securities in accordance with Section 5.1, the Surviving Entity shall succeed to, and may be substituted for, and may exercise every right and power of, the Company under this Indenture with the same effect as if such successor corporation has been named as the Company herein, and, except in the case of a lease, the predecessor corporation shall be relieved of all obligations and covenants under this Indenture and the Securities. ARTICLE VI DEFAULTS AND REMEDIES SECTION 6.1 EVENTS OF DEFAULT. "Event of Default" is hereby defined for all purposes of this Indenture and with respect to any series of Securities (except where the term is otherwise defined for specific purposes) as any one of the following events (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body): (a) the Company defaults in the payment of any installment of interest on or any Additional Amounts payable in respect of any Security of that series when and as the same shall become due and payable and such failure continues for a period of 30 days; (b) the Company defaults in the payment of all or any part of the principal of any Security of that series when and as the same shall become due and payable at Stated Maturity, upon redemption or otherwise; (c) the Company fails to perform or observe any of its other covenants, conditions or agreements in this Indenture or in that series of Securities (other than a covenant, condition or agreement a Default in whose performance or whose breach is elsewhere in this Section specifically dealt with), and such failure continues for a period of 90 days after the date on which written notice of such Default has been given to the Company by the Trustee or to the Company and to the Trustee by the Holders of not less than 25% of the principal amount of the Securities of that series then outstanding under this Indenture; (d) the entry by a court having jurisdiction in the premises of (i) a decree or order for relief in respect of the Company in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization or other similar law or (ii) a decree or order adjudging the Company a bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjustment or composition of or in respect of the Company under any applicable federal or state law, or appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official of the Company or of any substantial part of its property, or ordering the winding up 34 41 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 90 consecutive days; or (e) the commencement by the Company of a voluntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization or other similar law or, of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by the Company to the entry of a decree or order for relief in respect of the Company 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 the filing by the Company of a petition or answer or consent seeking reorganization or relief under any applicable federal or state law, or the consent by the Company to the filing of such petition or to the appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator or similar official of the Company or of any substantial part of its property, or the making by the Company of an assignment for the benefit of creditors, or the taking of corporate action by the Company in furtherance of any such action. The Company shall deliver to the Trustee, within five days after the occurrence thereof, an Officers' Certificate detailing any Default of which it is aware, its status and what action the Company is taking or proposes to take with respect thereto. SECTION 6.2 ACCELERATION. If an Event of Default specified in Section 6.1(d) or (e) shall occur and be continuing, then the principal of (or, with respect to a series of Original Issue Discount Securities, such portion of the principal amount as may be specified in the terms of such series), and any accrued and unpaid interest on and any Additional Amounts payable in respect of the Securities shall immediately become due and payable without any declaration or other act on the part of the Trustee or any Securityholder. If one or more Events of Default specified in Sections 6.1(a) through (c) with respect to any series of Securities at the time outstanding shall occur and be continuing, then, and in each and every such case, either the Trustee, by notice in writing to the Company, or the Holders of not less than 25% of the principal amount of the Securities of that series then outstanding, by notice in writing to the Company and the Trustee, may declare due and payable, if not already due and payable, the principal of (or, with respect to a series of Original Issue Discount Securities, such portion of the principal amount as may be specified in the terms of such series) plus any accrued interest on and any Additional Amounts payable in respect of all of the Securities of that series; and upon any such declaration all such amounts upon such Securities shall become and be immediately due and payable, anything in this Indenture or in the Securities to the contrary notwithstanding. This provision is subject to the condition that if, after any declaration of acceleration and before Stated Maturity of the principal with respect to Securities of such series, all arrears of interest and any Additional Amounts and the expenses of the Trustee, its agents or counsel shall be paid by or for the account of the Company, and all Defaults (other than the payment of principal that has been declared due and payable) have been cured to the satisfaction of the Trustee, then the Trustee shall, upon the written request of the Holders of a majority in principal amount of the Securities of that series, waive such Default and rescind or annul the declaration of acceleration; but no such waiver or rescission or annulment shall extend to or affect any subsequent Default, or impair any right consequent thereon. 35 42 SECTION 6.3 OTHER REMEDIES. If an Event of Default with respect to Securities of any series occurs and is continuing, the Trustee may pursue any available remedy to collect the payment of principal of, interest on or any Additional Amounts payable in respect of the Securities of that series or to enforce the performance of any provision of the Securities of that series or this Indenture. The Trustee may maintain a proceeding even if it does not possess any of the Securities of that series or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Securityholder in exercising any right or remedy accruing upon any Event of Default shall not impair any such right or remedy or constitute a waiver of or acquiescence in the Event of Default. No remedy is exclusive of any other remedy. All available remedies are cumulative. SECTION 6.4 WAIVER OF PAST DEFAULTS. Provided the applicable series of Securities shall not then be due and payable by reason of a declaration pursuant to Section 6.2, the Holders of a majority in principal amount of the Securities of any series at the time outstanding may on behalf of the Holders of all the Securities of such series waive any past Default hereunder with respect to such series and its consequences by providing written notice thereof to the Company and the Trustee, except a Default (i) in the payment of interest on, any Additional Amounts payable in respect of or the principal of any Security of such series or (ii) in respect of a covenant or provision hereof which under Article IX cannot be modified or amended without the consent of the Holder of each outstanding Security of such series affected. In the case of any such waiver, the Company, the Trustee and the Holders of the Securities of such series shall be restored to their former positions and rights hereunder, respectively; provided that no such waiver shall extend to any subsequent or other Default or impair any right consequent thereto. SECTION 6.5 CONTROL BY MAJORITY. The Holders of a majority in principal amount of the Securities then outstanding of any series may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or of exercising any power or trust conferred upon the Trustee under this Indenture with respect to the Securities of such series; provided, however, that subject to the provisions of Sections 7.1 and 7.2, the Trustee shall have the right to decline to follow any such direction if the Trustee, advised by counsel, determines that the action or proceeding so directed may not lawfully be taken or if the Trustee in good faith shall by Responsible Officers determine that the action or proceeding so directed would involve the Trustee in liability or that the Trustee is not satisfactorily indemnified from the costs thereof. SECTION 6.6 LIMITATION ON SUITS BY HOLDERS. No Holder of any Security of any series or any coupon appertaining thereto shall have the right to pursue a remedy with respect to this Indenture or the Securities unless: 36 43 (1) such Holder gives to the Trustee notice of a continuing Event of Default with respect to Securities of that series; (2) the Holders of at least a majority in principal amount of the Securities of that series make a request to the Trustee to pursue the remedy; (3) such Holder or Holders offer to the Trustee security or indemnity satisfactory to the Trustee against any loss, liability or expense; and (4) the Trustee does not comply with the request within 30 days after receipt of the request and the offer of security or indemnity. A Securityholder may not use this Indenture to prejudice the rights of another Securityholder or to obtain a preference or priority over another Securityholder. SECTION 6.7 RIGHTS OF HOLDERS TO RECEIVE PAYMENT. Notwithstanding any other provision of this Indenture, the right of any Holder of a Security or coupon to receive payment of principal of, interest on and any Additional Amounts payable with respect to the Security or coupon, on or after the respective due dates expressed in the Security or coupon, or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of the Holder. SECTION 6.8 COLLECTION SUIT BY TRUSTEE. If an Event of Default specified in Section 6.1(a) or (b) occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company for the whole amount of principal, interest and any Additional Amounts remaining unpaid, together with interest on overdue principal and, to the extent lawful, interest on overdue installments of interest and any Additional Amounts, in each case at the rate or Yield to Maturity (in the case of Original Issue Discount Securities) specified in the Securities and such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel and any other amounts due the Trustee under Section 7.7. SECTION 6.9 TRUSTEE MAY FILE PROOFS OF CLAIM. The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee and the Securityholders allowed in any judicial proceedings relative to the Company, its creditors or its property and the Trustee shall be entitled and empowered to collect and receive any money or other property payable or deliverable on any such claims and to distribute it, and any trustee, receiver, liquidator, custodian or other similar official in any such judicial proceedings is hereby authorized by each Securityholder to make such payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to Securityholders, to pay to the Trustee any amount due to it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any 37 44 other amounts due the Trustee under Section 7.7. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Securityholder any plan of reorganization, arrangement, adjustment or composition affecting the Securities or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of any claim of any Securityholder in such proceeding. SECTION 6.10 APPLICATION OF MONEY COLLECTED. Any money or property collected by the Trustee with respect to any series of the Securities under this Article VI shall be paid out by the Trustee in the following order and, in the case of the distribution of moneys on account of principal, interest or any Additional Amounts, upon presentation of such Securities and coupons appertaining to such Securities in respect of which monies have been collected (except that the Trustee may waive presentation of Registered Securities when interest alone is to be paid), and stamping thereon the payment, or issuing Securities of such series in reduced principal amounts in exchange for the presented Securities of like series if only partially paid, and upon surrender thereof if fully paid: FIRST: To the payment of costs and expenses of collection, and reasonable compensation to the Trustee, its agents and counsel, and of all other expenses, losses, and liabilities incurred, and all advances made, by the Trustee except as a result of its negligence or bad faith; SECOND: In case the principal of the outstanding Securities of such series shall not have become due and be unpaid, to the payment of interest on and any Additional Amounts Payable with respect to such Securities, in the order of the maturity of the installments of such interest and Additional Amounts, with interest, to the extent lawful, upon the overdue installments of interest and Additional Amounts at the rate or Yield to Maturity (in the case of Original Issue Discount Securities) specified in such Securities, such payments to be made ratably to the Persons entitled thereto, without discrimination or preferences; THIRD: In case the principal of the outstanding Securities of such series shall have become due, by declaration or otherwise, to the payment of the whole amount then owing and unpaid upon such Securities for principal, interest and any Additional Amounts, with interest at the rate or Yield to Maturity (in the case of Original Issue Discount Securities) specified in such Securities on the overdue principal, and, to the extent lawful, on the overdue installments of interest and Additional Amounts; and in case such monies shall be insufficient to pay in full the whole amount so due and unpaid upon such Securities, then to the payment of such principal, interest and any Additional Amounts, ratably, without preference or priority of any kind, to the aggregate of such principal and accrued and unpaid interest and Additional Amounts; and FOURTH: In case the Trustee shall retain possession of any funds after all obligations of the Company hereunder have been fully paid and satisfied, such funds shall be paid to the Company, its successors or assigns. The Trustee may fix a record date and payment date for any payment to Securityholders pursuant to this Section. At least 15 days before such record date, the Company shall mail to each 38 45 Securityholder and the Trustee a notice that states the record date, the payment date and the amount to be paid. SECTION 6.11 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 or omitted by it as Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys' fees, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section does not apply to a suit instituted by the Trustee, a suit instituted by a Holder pursuant to Section 6.7 or a suit instituted by Holders of more than 10% in principal amount of the Securities then outstanding. This Section 6.11 shall be in lieu of Section 315(c) of the TIA and said Section 315(c) is hereby expressly excluded from this Indenture, as permitted by the TIA. SECTION 6.12 DISCONTINUANCE OR ABANDONMENT OF PROCEEDINGS. If the Trustee or any Holder shall have proceeded to enforce any right under this Indenture, and such proceedings shall have been discontinued or abandoned because of waiver, or for any other reason, or shall have been determined adversely to the Trustee or such Holder, then, and in any such case, the Company and the Trustee and such Holder or Holders shall each be restored to its former position and rights hereunder, and all rights, remedies and powers of the Trustee and the Holders shall continue as though no such proceedings had been taken. ARTICLE VII TRUSTEE SECTION 7.1 DUTIES OF TRUSTEE. (a) If an Event of Default has occurred and is continuing, the Trustee, subject to paragraph (e) below, shall exercise the rights and powers vested in it by this Indenture and use the same degree of care and skill in its exercise as a prudent person would exercise or use under the circumstances in the conduct of such person's own affairs. (b) Except during the continuance of an Event of Default: (i) The Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture and no implied covenants or obligations shall be read into this Indenture against the Trustee; and (ii) In the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the 39 46 requirements of this Indenture. However, in the case of any opinions or certificates which by any provision hereof are specifically required to be furnished to the Trustee, the Trustee shall examine the certificates and opinions to determine whether or not they conform to the requirements of this Indenture. (c) The Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act or its own willful misconduct, except that: (i) This paragraph does not limit the effect of paragraph (b) of this Section 7.1; (ii) The Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts; and (iii) The Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.5. (d) Whether or not therein expressly so provided, every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs(a), (b) and (c) of this Section. (e) 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 the Trustee shall have reasonable grounds to believe that. repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. (f) The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law. (g) No provision of this Indenture shall require the Trustee to determine the maximum interest rate permissible under applicable law. (h) 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 and to the provisions of the TIA. SECTION 7.2 RIGHTS OF TRUSTEE. (a) The Trustee may rely on and shall be protected in acting or refraining from acting on any document believed by it to be genuine and to have been signed or presented by the proper person. The Trustee need not investigate any fact or matter stated in the document. 40 47 (b) Before the Trustee acts or refrains from acting, it may require an Officers' Certificate and an Opinion of Counsel. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such Officers' Certificate or Opinion of Counsel. The Trustee may consult with counsel of its selection and the written advice of such counsel or any Opinion of Counsel with respect to legal matters relating to this Indenture and the Securities shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in accordance with the advice or opinion of such counsel. (c) The Trustee may act through agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care. (d) The Trustee shall not be liable for any action it takes or omits to take in good faith which it believes to be authorized or within its rights or powers conferred upon it hereunder; provided, however, that the Trustee's conduct does not constitute willful misconduct, negligence or bad faith. (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 investigation 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 and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation. SECTION 7.3 INDIVIDUAL RIGHTS OF TRUSTEE. The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with the Company or an Affiliate with the same rights it would have if it were not Trustee. Any Paying Agent, Registrar or co-registrar may do the same with like rights. However, the Trustee must comply with Sections 7.10 and 7.11. SECTION 7.4 TRUSTEE'S DISCLAIMER. The Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture or the Securities; it shall not be accountable for the Company's use of the proceeds from the sale of the Securities; and it shall not be responsible for any statement of the Company in this Indenture or in any document issued in connection with the sale of the Securities or in the Securities other than the Trustee's certificate of authentication. 41 48 SECTION 7.5 NOTICE OF DEFAULTS. If a Default occurs with respect to Securities of any series and is continuing and if it is known to the Trustee, the Trustee shall give to each Securityholder of such series a notice of the Default within 90 days after it occurs in the manner and to the extent provided in TIA 313(c), and otherwise as provided in Section 13.2 hereof. Except in the case of a Default in payment of the principal of, interest on and any Additional Amount payable in respect of any series of Security (including payments pursuant to a redemption or repurchase of the Securities pursuant hereto), the Trustee may withhold the notice if and so long as a committee of its Responsible Officers in good faith determines that withholding the notice is in the interests of Securityholders of such series. The Trustee shall not be deemed to have knowledge of any Default or Event of Default except (i) a Default under Section 6.1(a) or (b) so long as the Trustee is Paying Agent or (ii) any Default or Event of Default of which the Trustee shall have received written notification or a Responsible Officer charged with the administration of this Indenture shall have obtained actual knowledge, and such notification shall not be deemed to include receipt of information obtained in any report or other documents furnished under Section 4.4 of this Indenture, which reports and documents the Trustee shall have no duty to examine. SECTION 7.6 REPORTS BY TRUSTEE TO HOLDERS. Within 60 days after each January 1 and July 1 beginning with the January 1 following the date of this Indenture, the Trustee shall mail to each Holder of a Registered Security a brief report dated as of such reporting date if required by, and in compliance with, TIA Section 313(a). The Trustee also shall comply with TIA Section 313(b). The Trustee shall also transmit by mail all reports as required by TIA Section 313(c). Commencing at the time this Indenture is qualified under the TIA, a copy of each report at the time of its mailing to Securityholders shall be filed with the Commission and each securities exchange, if any, on which the Securities are listed. The Company agrees to notify promptly the Trustee whenever the Securities become listed on any securities exchange and of any delisting thereof. SECTION 7.7 COMPENSATION AND INDEMNITY. The Company shall pay to the Trustee from time to time such compensation as shall be agreed to in writing from time to time between the Company and the Trustee for all services rendered by it hereunder. The Trustee's compensation shall not be limited by any law on compensation of a trustee of an express trust. The Company shall reimburse the Trustee upon request for all reasonable disbursements, advances and expenses incurred or made by the Trustee in accordance with any provision of this Indenture. Such expenses shall include the reasonable compensation and the disbursements, advances and expenses of the Trustee's agents and counsel, except to the extent any such disbursement, advance or expense may be attributable to its negligence or bad faith. The Company shall indemnify the Trustee and its directors, officers, agents and employees against any and all loss, liability, damage, claim or expense (including attorneys' fees and 42 49 expenses) incurred by it or such officer, director, agent or employee in connection with the acceptance or administration of its duties under this Indenture, except as set forth in the next paragraph. The Trustee shall notify the Company promptly of any claim for which it may seek indemnity. The Company shall defend the claim and the Trustee or such officer, director, agent or employee shall cooperate in the defense. The Trustee or such officer, director, agent or employee may have separate counsel and the Company shall pay the reasonable fees and expenses of such counsel. The Company need not pay for any settlement made without its consent, which consent shall not be unreasonably withheld. The Company need not reimburse any expense or indemnify against any loss, liability or expense incurred by the Trustee through the Trustee's own willful misconduct, negligence or bad faith. To secure the Company's payment obligations in this Section, the Trustee shall have a Lien prior to the Securities on all money or property held or collected by the Trustee other than money or property held in trust to pay the principal of, interest on or any Additional Amounts payable with respect to particular Securities. The Company's payment obligations pursuant to this Section 7.7 shall survive the resignation or replacement of the Trustee and any discharge or defeasance under Sections 8.1 and 8.2. When the Trustee incurs expenses after the occurrence of an Event of Default specified in Section 6.1(e) or (f), the expenses are intended to constitute expenses of administration under any Bankruptcy Law. The provisions of this Section shall survive the termination of this indenture. SECTION 7.8 REPLACEMENT OF TRUSTEE. The Trustee may resign at any time by so notifying the Company; provided, however, no such resignation shall be effective until a successor Trustee has accepted its appointment pursuant to this Section 7.8. The Holders of a majority in principal amount of the then outstanding Securities may remove the Trustee by so notifying the Trustee and the Company. The Company shall remove the Trustee if: (a) the Trustee fails to comply with Section 7.10; (b) the Trustee is adjudged bankrupt or insolvent; (c) a receiver or public officer takes charge of the Trustee or its property; (d) the Trustee otherwise becomes incapable of acting; or (e) the Company otherwise deems such removal necessary. 43 50 If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason (the Trustee in such event being referred to herein as the retiring Trustee), the Company shall promptly appoint a successor Trustee. If the Trustee fails to comply with Section 7.10, any Securityholder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee. A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Thereupon the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture. The successor Trustee shall mail a notice of its succession to Securityholders. The retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee, subject to the Lien provided for in Section 7.7. Notwithstanding replacement of the Trustee pursuant to this Section 7.8, the Company's obligations under Section 7.7 shall continue for the benefit of the retiring Trustee. If a successor Trustee does not take office within 30 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company or the Holders of a majority in principal amount of the then outstanding Securities may petition any court of competent jurisdiction for the appointment of a successor Trustee. SECTION 7.9 SUCCESSOR TRUSTEE BY MERGER. If the Trustee consolidates with, merges or converts into, or transfers all or substantially all of its corporate trust business or assets to, another corporation or banking association, the resulting, surviving or transferee corporation or banking association without any further act shall be the successor Trustee upon the approval thereof by the Company. SECTION 7.10 ELIGIBILITY; DISQUALIFICATION. The Trustee shall at all times satisfy the requirements of TIA Section 310(a). The Trustee shall have a combined capital and surplus of at least $50,000,000 as set forth in its most recent published annual report of condition. SECTION 7.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY. The Trustee shall comply with TIA Section 311(a), excluding any creditor relationship listed in TIA Section 311(b). A Trustee who has resigned or been removed shall be subject to TIA Section 311(a) to the extent indicated therein. SECTION 7.12 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 in writing with the Company. 44 51 ARTICLE VIII DISCHARGE OF INDENTURE; DEFEASANCE SECTION 8.1 DISCHARGE OF INDENTURE; DEFEASANCE. (a) This Indenture shall cease to be of further effect with respect to a series of Securities (except that the Company's obligations under Section 7.7 and the Trustee's and Paying Agent's obligations under Section 8.4 shall survive) when (a) all outstanding Securities of such series theretofore authenticated and issued have been delivered (other than destroyed, lost or stolen Securities which have been replaced or paid pursuant to Section 2.6) to the Trustee for cancellation and (b) the Company has paid all sums payable hereunder. (b) Subject to Sections 8.1(c), 8.2 and 8.5, the Company at any time may terminate (i) all its obligations under the Securities of any series and this Indenture with respect to such series of Securities ("legal defeasance option") or (ii) its obligations under Article IV (except those obligations set forth in Sections 4.1, 4.2 and 4.10 thereof) with respect to any series of Securities ("covenant defeasance option"). The Company may exercise its legal defeasance option notwithstanding its prior exercise of its covenant defeasance option. If the Company exercises its legal defeasance option, payment of the Securities of the applicable series may not be accelerated because of an Event of Default. Upon satisfaction of the conditions set forth herein and upon request of the Company, the Trustee shall acknowledge in writing the discharge of those obligations that the Company terminates. (c) Notwithstanding clauses (a) and (b) above, the Company's obligations in Sections 2.3, 2.4, 2.5, 2.6, 7.7, 8.4 and 8.5 and Article XI and Article XII shall survive until the Securities have been paid in full. Thereafter, the Company's obligations in Sections 7.7 and 8.4 shall survive. SECTION 8.2 CONDITIONS TO DEFEASANCE. The Company may exercise its legal defeasance option or its covenant defeasance option with respect to a series of Securities only if the following conditions are satisfied: (a) the Company has irrevocably deposited or caused to be deposited in trust for the benefit of the Holders of such series with the Trustee or a Paying Agent or a trustee satisfactory to the Trustee and the Company, under the terms of an irrevocable trust agreement in form and substance satisfactory to the Trustee and any such Paying Agent, (i) money or eligible Obligations in an amount sufficient, or (ii) U.S. Government Obligations that shall be payable as to principal and interest in such amounts and at such times as are sufficient, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee (without consideration of any reinvestment of such interest), or (iii) any combination thereof in an amount sufficient, to pay the principal of, interest on and any Additional Amounts payable with 45 52 respect to the outstanding Securities of such series on the dates such installments are due to redemption or Stated Maturity, (b) the trustee of the irrevocable trust shall have been irrevocably instructed to pay such money or the proceeds of such U.S. Government Obligations or Eligible Obligations to the Trustee and (c) the Trustee or Paying Agent shall have been irrevocably instructed in writing to apply the deposited money and the proceeds from U.S. Government Obligations or Eligible Obligations in accordance with the terms of this Indenture and the terms of the Securities of such series to the payment of principal of, interest on and any Additional Amounts payable with respect to the Securities of such series. (b) such deposit described in clause (1) of this Section 8.2 will not result in a breach or violation of, or constitute a Default under, any other agreement or instrument to which the Company is a party or by which it is bound; (c) no Default or Event of Default shall have occurred and be continuing (i) as of the date of such deposit or (ii) insofar as Sections 6.1(e) and 6.1(f) are concerned at any time during the period ending on the 91st day after the date of such deposit or, if longer, ending on the day following the expiration of the longest preference period applicable to the Company in respect of such deposit (it being understood that the condition in this clause (ii) is a condition subsequent and shall not be deemed satisfied until the expiration of such period); (d) the company has paid or caused to be paid all sums currently due and payable by the Company hereunder and under the Securities with respect to such series; (e) such defeasance shall not cause or permit any Securities then listed on any national securities exchange to be delisted; (f) the Company has delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for herein relating to the termination by the Company of its obligations as provided in this Section 8.2 have been complied with; (g) in the case of the legal defeasance option, the Company has delivered to the Trustee either (i) a ruling received from the Internal Revenue Service to the effect that, or (ii) an Opinion of Counsel by recognized counsel who is not an employee of the Company stating that, since the date first set forth hereinabove, there has been a change in the applicable federal income tax law, and based upon either case (i) or (ii) such Opinion of Counsel shall confirm that, the Holders of the Securities of such series will not recognize income, gain or loss for federal income tax purposes as a result of the Company's exercise of its legal defeasance option under this Section 8.2 and will be subject to federal income tax on the same amount and in the same manner and at the same times as would have been the case if such legal defeasance option had not been exercised; and (h) in the case of the covenant defeasance option, the Company has delivered to the Trustee either (i) a ruling received from the Internal Revenue Service to the effect that, or (ii) an Opinion of Counsel by recognized counsel who is not an employee of the Company stating that, the Holders of the Securities of such series will not recognize income, gain or loss for federal income tax purposes as a result of the Company's exercise of its covenant defeasance option under this paragraph 46 53 and will be subject to federal income tax on the same amount and in the same manner and at the same times as would have been the case if such covenant defeasance option had not been exercised. SECTION 8.3 APPLICATION OF TRUST MONEY. The Trustee or a trustee satisfactory to the Trustee and the Company shall hold in trust money, U.S. Government obligations or Eligible obligations deposited with it pursuant to Section 8.2. It shall apply the deposited money and the money from U.S. Government Obligations and Eligible Obligations through the Paying Agent and in accordance with this Indenture to the payment of principal of, interest on and any Additional Amounts payable with respect to the Securities. SECTION 8.4 REPAYMENT TO COMPANY. The Trustee and the Paying Agent shall promptly turn over to the Company upon written request any money, U.S. Government Obligations or Eligible Obligations held by them in trust pursuant to Section 8.2 which, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, are in excess of the amount thereof which would then be required to be deposited to effect such defeasance, in accordance with the provisions of this Indenture. The Trustee or the Paying Agent shall pay promptly to the Company upon written request any money held by them for the payment of principal, interest or Additional Amounts that remains unclaimed for two years after the date upon which such payment shall have become due, unless otherwise required by mandatory provisions of applicable escheat or abandoned or unclaimed property law (except that with respect to any amounts then held by the Company in trust as its own Paying Agent no such request need be given and at such time the Company shall be discharged from its duties to hold such money in trust as Paying Agent). After payment to the Company, Securityholders entitled to the money must look to the Company for payment as general creditors unless an applicable abandoned property law designates another Person, and all liability of the Trustee and such Paying Agent with respect to such money shall cease. SECTION 8.5 REINSTATEMENT OF COMPANY'S OBLIGATIONS. If the Trustee or Paying Agent is unable to apply any money, U.S. Government Obligations or Eligible Obligations in accordance with Section 8.2 by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the Company's obligations under this Indenture and the Securities of the applicable series shall be revived and reinstated as though no deposit had occurred pursuant to Section 8.2 until such time as the Trustee or Paying Agent is permitted to apply all such money, U.S. Government Obligations or Eligible Obligations in accordance with Section 8.2; provided, however, that if the Company has made any payment of interest on, Additional Amounts payable with respect to or principal of any Securities because of the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Securities to receive such payment from the money, U.S. Government Obligations or Eligible Obligations held by the Trustee or Paying Agent. 47 54 ARTICLE IX AMENDMENTS AND WAIVER SECTION 9.1 WITHOUT CONSENT OF HOLDERS. The Company, when authorized by a Board Resolution, and the Trustee may enter into an indenture or indentures supplemental hereto to amend this Indenture or the Securities with respect to a particular series without prior notice to or the consent of any Securityholder of such series: (1) to cure any ambiguity, omission, defect or inconsistency; (2) to comply with Article V; (3) to comply with any requirements of the Commission in connection with the qualification of this Indenture under the TIA as then in effect; (4) to provide for uncertificated Securities in addition to or in place of certificated Securities; provided, however, that the uncertificated Securities are issued in registered form for purposes of Section 163(f) of the Internal Revenue Code or in a manner such that the uncertificated Securities are described in Section 163(f)(2) of the Internal Revenue Code; (5) to make any change that does not materially adversely affect the legal rights of any Securityholder under this Indenture as then in effect; (6) to secure the Securities and to make intercreditor arrangements with respect to any such security, unless the incurrence of such obligations or the security thereof is prohibited by this Indenture; (7) to evidence or to provide for a replacement Trustee under Section 7.8 or 7.9; (8) to add to the covenants and agreements of the Company for the benefit of all of the Holders of all of the Securities with respect to a series (and if such covenants are to be for the benefit of less than all series of Securities, stating that such covenants are being included solely for the benefit of such series) and to surrender any right or power herein reserved to the Company; or (9) to add to, change or eliminate any of the provisions of this Indenture in respect of one or more series of Securities, provided that any such addition, change or elimination (i) shall neither (A) apply to any Security of any series created prior to the execution of such supplemental indenture and entitled to the benefit of such provision nor (B) modify the rights of the Holder of any such Security with 48 55 respect to such provision or (ii) shall become effective only when there is no Security outstanding under this Indenture. After an amendment under this Section becomes effective, the Company shall give to Securityholders a notice briefly describing the substance thereof in the manner as provided in Section 13.2. The failure to give such notice to all Securityholders, or any defect therein, shall not impair or affect the validity of any supplemental indenture. SECTION 9.2 WITH CONSENT OF HOLDERS. The Company, when authorized by a Board Resolution, and the Trustee may enter into one or more supplemental indentures to amend this Indenture or the Securities with respect to a particular series with the written consent of the Holders of a majority of the principal amount of the then outstanding Securities of such series. The Holders of a majority in principal amount of the then outstanding Securities of a particular series may waive compliance by the Company with any provision of this Indenture or the Securities with respect to such series without prior notice to any other Securityholder. Notwithstanding the first paragraph of this Section 9.2, without the consent of each Securityholder affected, an amendment or waiver under this Section may not: (1) reduce the amount of Securities whose Holders must consent to an amendment or waiver; (2) reduce the rate of or change the time for payment of interest or Additional Amounts, including default interest, on any Security; (3) reduce the principal of or change the Stated Maturity of any Security or alter the provisions with respect to redemption pursuant to Section 3.8; (4) make any Security payable in money other than that stated in the Security; (5) make any change in this paragraph of this Section 9.2; (6) make any change in this Indenture that adversely affects ranking of the Securities; or (7) make any change in Section 6.4 or 6.7. It shall not be necessary for the consent of the Holders under this Section to approve the particular form of any proposed amendment or waiver but it shall be sufficient if such consent approves the substance thereof. A supplemental indenture which changes or eliminates any covenant or other provision of this Indenture which has been included solely for the benefit of one or more series of Securities, or which modifies the rights of the Holders of Securities of such series with respect to such covenant 49 56 or other provision, shall be deemed not to affect the rights under this Indenture of the Holders of Securities of any other series. Any amendment shall be effective upon certification to the Trustee by the Company or an agent of the Company that such amendment has been authorized by the Company and that the consent of the majority in principal amount of the Securities has been obtained unless such consents specify that they shall become effective at a later date, in which case such amendment shall become effective in accordance with the terms of such consent. After an amendment or waiver under this Section becomes effective, the Company shall give to Securityholders a notice briefly describing the substance thereof in the manner as provided in Section 13.2. The failure to give such notice to all Securityholders, or any defect therein, shall not impair or affect the validity of any supplemental indenture. SECTION 9.3 COMPLIANCE WITH TRUST INDENTURE ACT. Every amendment to this Indenture or the Securities or waiver of the provisions hereof or thereof shall be set forth in a supplemental indenture that complies with the TIA as then in effect. SECTION 9.4 REVOCATION AND EFFECT OF CONSENTS AND WAIVERS. Until an amendment or waiver becomes effective, a consent to it by a Holder of a Security is a continuing consent by the Holder and every subsequent Holder of that Security or portion of the Security that evidences the same debt as the consenting Holder's Security, even if notation of the consent or waiver is not made on the Security. However, any such Holder or subsequent Holder may revoke the consent or waiver as to such Holder's Security or portion of the Security if the Trustee receives written notice of revocation before the date the amendment or waiver becomes effective. The Company may, but shall not be obligated to, fix a record date for the purpose of determining the Holders entitled to consent to any amendment or waiver. If a record date is fixed, then notwithstanding the next to last sentence of the immediately preceding paragraph, those persons who were Holders at such record date (or their duly designated proxies), and only those persons, shall be entitled to consent to such amendment or waiver or to revoke any consent previously given, whether or not such persons continue to be Holders after such record date. No such consent shall be valid or effective for more than 120 days after such record date. After an amendment or waiver becomes effective, it shall bind every Securityholder, subject to the fourth paragraph of Section 9.2 and unless it makes a change described in any of clauses (1) through (7) of Section 9.2. In that case, the amendment or waiver shall bind each Holder of a Security who has consented to it and every subsequent Holder of a Security or a portion of a Security that evidences the same debt as the consenting Holder's Security. 50 57 SECTION 9.5 NOTATION ON OR EXCHANGE OF SECURITIES. If a supplemental indenture changes the terms of a Security, the Trustee may require the Holder of the Security to deliver it to the Trustee. The Trustee may place an appropriate notation on the Security regarding the changed terms and return it to the Holder. Alternatively, if the Company shall so determine, the Company in exchange for all Securities may issue and the Trustee shall authenticate new Securities of the same series that reflect the changed terms. SECTION 9.6 TRUSTEE TO SIGN AMENDMENTS. Upon the written request of the Company, accompanied by a Board Resolution authorizing the execution of a supplemental indenture, and upon the filing with the Trustee of evidence of the consent of the Securityholders if such consent shall be required under Section 9.2, the Trustee shall sign any supplemental indenture authorized pursuant to this Article IX; provided that the Trustee shall not be obligated to sign any supplemental indenture that adversely affects the Trustee's rights, duties, liabilities or immunities. In signing such supplemental indenture, the Trustee shall be entitled to receive and, subject to Section 7.1, shall be fully protected in relying upon, an Officers' Certificate and an Opinion of Counsel stating that such amendment is authorized or permitted by this Indenture, that it is not inconsistent herewith, and that it will be valid and binding upon the Company in accordance with its terms. ARTICLE X REPAYMENT AT THE OPTION OF HOLDERS SECTION 10.1 APPLICABILITY OF ARTICLE. Securities of any series which are repayable at the option of the Holders thereof before their maturity shall be repaid in accordance with the terms of the Securities of such series. The repayment of any principal amount of Securities pursuant to such option of the Holder to require repayment of Securities before their maturity shall not operate as a payment, redemption or satisfaction of the indebtedness represented by such Securities unless and until the Company, at its option, shall deliver or surrender the same to the Trustee with a directive that such Securities be cancelled. Notwithstanding anything to the contrary contained in this Article X, in connection with any repayment of Securities, the Company may arrange for the purchase of any Securities by an agreement with one or more investment bankers or other purchasers to purchase such Securities by paying to the Holders of such Securities on or before the close of business on the repayment date an amount not less than the repayment price payable by the Company on repayment of such Securities, and the obligation of the Company to pay the repayment price of such Securities shall be satisfied and discharged to the extent such payment is so paid by such purchasers. 51 58 ARTICLE XI SINKING FUNDS SECTION 11.1 APPLICABILITY OF ARTICLE. The provisions of this Article XI shall be applicable to any sinking fund for the retirement of Securities of a series, except as otherwise permitted or required by any form of Security of such series issued pursuant to this Indenture. The minimum amount of any sinking fund payment provided for by the terms of Securities of any series is referred to in this Article XI as a "mandatory sinking fund payment," and any payment in excess of such minimum amount provided for by the terms of Securities of such series is herein referred to as an "optional sinking fund payment." If provided for by the terms of Securities of any series, the cash amount of any sinking fund payment may be subject to reduction as provided in Section 11.2. Each sinking fund payment shall be applied to the redemption of Securities of any series as provided for by the terms of Securities of such series. SECTION 11.2 SATISFACTION OF SINKING FUND PAYMENTS WITH SECURITIES. The Company may, in satisfaction of all or any part of any sinking fund payment with respect to the Securities of such series to be made pursuant to the terms of such Securities as provided for by the terms of such series (1) deliver outstanding Securities of such series (other than any of such Securities previously called for redemption or any of such Securities in respect of which cash shall have been released to the Company), together in the case of any Bearer Securities of such series with all unmatured coupons appertaining thereto, and (2) apply as a credit Securities of such series which have been redeemed either at the election of the Company pursuant to the terms of such series of Securities or through the application of permitted optional sinking fund payments pursuant to the terms of such Securities, provided that such series of Securities have not been previously so credited. Such Securities shall be received and credited for such purpose by the Trustee at the Redemption Price specified in such Securities for redemption through operation of the sinking fund and the amount of such sinking fund payment shall be reduced accordingly. If as a result of the delivery or credit of Securities of any series in lieu of cash payments pursuant to this Section 11.2, the principal amount of Securities of such series to be redeemed in order to exhaust the aforesaid cash payment shall be less than $100,000, the Trustee need not call Securities of such series for redemption, except upon Company request, and such cash payment shall be held by the Trustee or a Paying Agent for Securities of that series and applied to the next succeeding sinking fund payment, provided, however, that the Trustee or such Paying Agent shall at the request of the Company from time to time pay over and deliver to the Company any cash payment so being held by the Trustee or such Paying Agent upon delivery by the Company to the Trustee of Securities purchased by the Company having an unpaid principal amount equal to the cash payment requested to be released to the Company. 52 59 SECTION 11.3 REDEMPTION OF SECURITIES FOR SINKING FUND. Not less than 60 days prior to each sinking fund payment date for any series of Securities, the Company will deliver to the Trustee an Officers' Certificate specifying the amount of the next ensuing mandatory sinking fund payment for that series pursuant to the terms of that series, the portion thereof, if any, which is to be satisfied by payment of cash and the portion thereof, if any, which is to be satisfied by payment of cash and the portion thereof, if any, which is to be satisfied by delivering and crediting of Securities of that series pursuant to Section 11.2, and the optional amount, if any, to be added in cash to the next ensuing mandatory sinking fund payment, and will also deliver to the Trustee any Securities to be so credited and not theretofore delivered. If such Officers' Certificate shall specify an optional amount to be added in cash to the next ensuing mandatory sinking fund payment, the Company shall thereupon be obligated to pay the amount therein specified. Not less than 30 days before each such sinking fund payment date the Trustee shall select the Securities to be redeemed upon such sinking fund payment date in the manner specified in Section 3.3 and cause notice of the redemption thereof to be given in the name of and at the expense of the Company in the manner provided in Section 3.4. Such notice having been duly given, the redemption of such Securities shall be made upon the terms and in the manner stated in Sections 3.5 and 3.6. ARTICLE XII CONVERSION OF SECURITIES SECTION 12.1 APPLICABILITY OF ARTICLE. The provisions of this Article XII shall be applicable to the Securities of any series which are convertible into Common Stock or, if so provided in a Board Resolution, Officers' Certificate or executed supplemental indenture referred to in Section 2.1 by or pursuant to which the form and terms of the Securities of such series were established, cash in lieu thereof, as provided by the terms of the Securities of such series. SECTION 12.2 EXERCISE OF CONVERSION PRIVILEGE. In order to exercise the conversion privilege, the Holder of any Security to be converted shall surrender such Security to the Conversion Agent at any time during usual business hours at its office or agency maintained for the purpose as provided in Section 4.2, accompanied by a fully executed written notice, in substantially the form set forth on the reverse of the Security, that the Holder elects to convert such Security or a stated portion thereof constituting a multiple of $1,000 in principal amount and, if such Security is surrendered for conversion during the period between the close of business on any record date for such Security and the opening of business on the related interest payment date and has not been called for redemption on a Redemption Date within such period (or on such interest payment date), accompanied also by payment of an amount equal to the interest payable on such interest payment date on the portion of the principal amount of the Security being surrendered for conversion. No interest shall be payable on any Security called for redemption which is converted between the record date and the opening of business of the next succeeding interest payment date. Such notice shall also state the name or names (and address) in which the 53 60 certificate or certificates for shares of Common Stock shall be issued (or to whom payment in cash in lieu of Common Stock shall be made) Securities surrendered for conversion shall (if so required by the Company or the Conversion Agent) be duly endorsed by, or be accompanied by a written instrument or instruments of transfer in form satisfactory to the Company and the Conversion Agent duly executed by, the Holder or his attorney duly authorized in writing. As promptly as practicable after the receipt of such notice and the surrender of such Security as aforesaid, the Company shall, subject to the provisions of Section 12.7, issue and deliver at such office or agency to such Holder, or on his written order, a certificate or certificates for the number of full shares of Common Stock issuable on conversion of such Security in accordance with the provisions of such Security and cash, as provided in Section 12.3, in respect of any fraction of a share of Common Stock otherwise issuable upon such conversion or, if so provided in a Board Resolution, Officers' Certificate or executed supplemental indenture referred to in Section 2.1 by or pursuant to which the form and terms of the Securities of such Series were established, cash, in lieu of shares of Common Stock. Such conversion shall be at the Conversion Price in effect, and shall be deemed to have been effected, immediately prior to the close of business on the date (herein called the "Date of Conversion") on which such notice in proper form shall have been received by the Conversion Agent and such Security shall have been surrendered as aforesaid, and the Person or Persons in whose name or names any certificate or certificates for shares of Common Stock shall be issuable, if any, upon such conversion shall be deemed to have become on the Date of Conversion the holder or holders of record of the shares represented thereby; provided, however, that any such surrender on any date when the stock transfer books of the Company shall be closed shall constitute the Person or Persons in whose name or names the certificate or certificates for such shares are to be issued, if any, as the record holder or holders thereof for all purposes at the opening of business on the next succeeding day on which such stock transfer books are open but such conversion shall nevertheless be at the Conversion Price in effect at the close of business on the date when such Security shall have been so surrendered with the conversion notice in proper form. In the case of conversion of a portion, but less than all, of a Security, the Company shall execute, and the Trustee shall authenticate and make available for delivery to the Holder thereof, at the expense of the Company, a Security or Securities in the aggregate principal amount of the unconverted portion of the Security surrendered. Except as otherwise expressly provided in this Indenture, no payment or adjustment shall be made for interest accrued on any Security (or portion thereof) converted or for dividends or distributions on any Common Stock issued upon conversion of any Security. The right, if any, of a Holder of any Security to cause the Company to redeem, purchase or repay such Security shall terminate upon receipt by the Company of any notice of conversion of such Security. SECTION 12.3 FRACTIONAL INTERESTS. No fractions of shares or scrip representing fractions of shares shall be issued upon conversion of Securities. If more than one Security shall be surrendered for conversion at one time by the same Holder, the number of full shares which shall be issuable upon conversion thereof shall be computed on the basis of the aggregate principal amount of the Securities so surrendered. If any fraction of a share of Common Stock would, except for the provisions of this Section 12.3, be issuable on the conversion of any Security or Securities, the Company shall make payment in lieu thereof in cash equal to the value of such fraction computed on the basis of the Last Sale Price of one share of Common Stock on the most recent Trading Day prior to the Date of Conversion. 54 61 "Last Sale Price" on any Trading Day shall mean (i) the closing price regular way (or, if no closing price is reported the average of the bid and asked prices) as reported on the New York Stock Exchange Composite Tape, or (ii) if on such Trading Day the Common Stock is not listed or admitted to trading on such exchange, the closing price regular way (or, if no closing price is reported the average of the bid and asked prices) on the principal national securities exchange on which the Common Stock is listed or admitted, or (iii) if not listed or admitted to trading on any national securities exchange on such Trading Day, then the average of the closing bid and asked prices as reported through the National Association of Securities Dealers, Inc. on its NASDAQ National Market System or NASDAQ System or a similar organization if NASDAQ is no longer reporting information, or (iv) if the Common Stock is not listed or admitted to trading on any national securities exchange or quoted on such National Market System or NASDAQ System on such Trading Day, then 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 Company for that purpose, or (v) if not quoted by any such organization on such Trading Day, the fair value of such Common Stock on such Trading Day, as determined by the Board of Directors. The term "Trading Day" shall mean each Monday, Tuesday, Wednesday, Thursday and Friday, other than any day on which securities are not traded on the applicable above mentioned exchanges or markets. SECTION 12.4 ADJUSTMENT OF CONVERSION PRICE. The "Conversion Price" for a Series of Securities shall be as set forth in a Board Resolution, Officers' Certificate or executed supplemental indenture referred to in Section 2.1 by or pursuant to which the form and terms of the Securities of such Series were established, and shall be subject to adjustment from time to time as follows: (a) In case the Company shall (1) pay a dividend or make a distribution in shares of Common Stock to holders of Common Stock, (2) subdivide its outstanding shares of Common Stock into a greater number of shares of Common Stock, (3) combine its outstanding shares of Common Stock into a smaller number of shares of Common Stock or (4) issue by reclassification of its Common Stock any shares of Capital Stock of the Company, the Conversion Price in effect immediately prior to such action shall be adjusted so that the Holder of any Security thereafter surrendered for conversion shall be entitled to receive the number of shares of Common Stock or other Capital Stock of the Company which he would have owned immediately following such action had such Security been converted immediately prior thereto. An adjustment made pursuant to this subsection (a) shall become effective immediately, except as provided in subsection (e) below, after the record date in the case of a dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or reclassification. If as a result of an adjustment made pursuant to this subsection (a), the Holder of any Security thereafter surrendered for conversion shall become entitled to receive shares of two or more classes of Capital Stock (including shares of Common Stock and other Capital Stock) of the Company, the Board of Directors (whose determination shall be conclusive and shall be described in a statement filed with the Trustee) shall determine the allocation of the adjusted Conversion Price between or among shares of such classes of Capital Stock or shares of Common Stock and other Capital Stock. (b) In case the Company shall issue rights or warrants to all holders of Common Stock entitling them (for a period not exceeding 45 days from the date of such issuance) to subscribe for 55 62 or purchase shares of Common Stock or Securities convertible into Common Stock at a price per share less than the current market price per share (as determined pursuant to subsection (d) below) of the Common Stock on the record date mentioned below, the Conversion Price shall be adjusted to a price, computed to the nearest cent, so that the same shall equal the price determined by multiplying: (1) the Conversion Price in effect immediately prior to the date of issuance of such rights or warrants by (2) a fraction, of which (i) the numerator shall be (A) the number of shares of Common Stock outstanding on the date of issuance of such rights or warrants, immediately prior to such issuance, plus (B) the number of shares of Common Stock which the aggregate offering price of the total number of shares of Common Stock (or the aggregate conversion price of the convertible securities) so offered for subscription or purchase would purchase at such current market price (determined by multiplying such total number of shares by the exercise price of such rights or warrants and dividing the product so obtained by such current market price), and of which (ii) the denominator shall be (A) the number of shares of Common Stock outstanding on the date of issuance of such rights or warrants, immediately prior to such issuance, plus (B) the number of additional shares of Common Stock (or into which the convertible securities are convertible) which are so offered for subscription or purchase. Such adjustment shall become effective immediately, except as provided in subsection (e) below, after the record date for the determination of holders entitled to receive such rights or warrants. (c) In case the Company shall distribute to substantially all holders of Common Stock, evidences of indebtedness, equity securities (including equity interests in the Company's Subsidiaries) other than common stock, or other assets (other than cash dividends paid out of surplus of the Company), or shall distribute to substantially all holders of Common Stock rights or warrants to subscribe for securities (other than those referred to in Subsection (b) above) then in each such case the Conversion Price shall be adjusted so that the same shall equal the price determined by multiplying the Conversion Price in effect immediately prior to the date of such distribution by a fraction of which the numerator shall be the current market price per share (determined as provided in subsection (d) below) of the Common Stock on the record date mentioned below less the then fair market value (as determined by the Board of Directors, whose determination shall, if made in good faith, be conclusive evidence of such fair market value) of the portion of the assets so distributed or of such subscription rights or warrants applicable to one share of Common Stock, and of which the denominator shall be such current market price per share of the Common Stock. Such adjustment shall become effective immediately, except as provided in subsection (e) below, after the record date for the determination of stockholders entitled to receive such distribution. 56 63 (d) For the purpose of any computation under subsections (b) and (c) above, the current market price per share of Common Stock on any date shall be deemed to be the average of the Last Sale Prices for the 30 consecutive Trading Days commencing 45 Trading Days before the date in question. (e) In any case in which this Section 12.4 shall require that an adjustment be made immediately following a record date, the Company may elect to defer the effectiveness of such adjustment (but in no event until a date later than the effective time of the event giving rise to such adjustment), in which case the Company shall, with respect to any Security converted after such record date and before such adjustment shall have become effective, (i) defer paying any cash payment pursuant to Section 12.3 or issuing to the Holder of such Security the number of shares of Common Stock and other Capital Stock of the Company issuable upon such conversion in excess of the number of shares of Common Stock and other Capital Stock of the Company issuable thereupon only on the basis of the Conversion Price prior to adjustment and (ii), not later than five Business Days after such adjustment shall have become effective, pay to such Holder the appropriate cash payment pursuant to Section 12.3 and issue to such Holder the additional shares of Common Stock and other Capital Stock of the Company issuable on such conversion. (f) No adjustment in the Conversion Price shall be required unless such adjustment would require an increase or decrease of at least 1% of the Conversion Price; provided that any adjustments which by reason of this subsection (f) are not required to be made shall be carried forward and taken into account in any subsequent adjustment and provided, further, that adjustment shall be required and made in accordance with the provisions of this Article XII (other than this subsection (f)) not later than such time as may be required in order to preserve the tax-free nature of a distribution to the holders of Securities or Common Stock. All calculations under this Article XII shall be made to the nearest cent or to the nearest one-hundredth of a share, as the case may be. (g) Anything in this Section 12.4 to the contrary notwithstanding, no adjustment need be made for rights to purchase Common Stock pursuant to a Company plan for reinvestment of dividends or interest or for rights to purchase Capital Stock pursuant to any future dividend or distribution which the Company determines to be comparable in purpose and in effect to the dividend and subsequent distribution of Rights contemplated by the Rights Agreement and no adjustment need be made for a change in the par value or no par value of the Common Stock. (h) Whenever the Conversion Price is adjusted as herein provided, the Company shall promptly (i) file with the Trustee and each Conversion Agent an Officers' Certificate setting forth the Conversion Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment, which certificate shall be conclusive evidence of the correctness of such adjustment, and (ii) mail or cause to be mailed a notice of such adjustment to each Holder of Securities at his address as the same appears on either the registry books of the Company or in the filings described in Section 2.4. Anything in this Section 12.4 to the contrary notwithstanding, the Company shall be entitled to make such reductions in the Conversion Price, in addition to those required by this Section 12.4 as it in its discretion shall determine to be advisable in order that any stock dividend, subdivision of shares, distribution of rights or warrants to purchase stock or securities, or distribution of other assets (other than cash dividends) hereafter made by the Company to its stockholders shall not be taxable. 57 64 SECTION 12.5 CONTINUATION OF CONVERSION PRIVILEGE IN CASE OF MERGER, CONSOLIDATION OR SALE OF ASSETS. If any of the following shall occur, namely: (a) any consolidation or merger of the Company as a result of which the holders of Common Stock shall be entitled to receive stock, other securities or other assets (including cash) with respect to or in exchange for Common Stock; or (b) any sale or conveyance of all or substantially all of the property or business of the Company as an entirety, then the Company, or such successor or purchasing corporation, as the case may be, shall, as a condition precedent to such consolidation, merger, sale or conveyance, execute and deliver to the Trustee a supplemental indenture (which shall conform to the TIA as in force at the date of the execution thereof) providing that the Holder of each convertible Security then outstanding shall have the right to convert such Security into the kind and amount of shares of stock and other securities and property (including cash) receivable upon such consolidation, merger, sale or conveyance by a holder of the number of shares of Common Stock issuable upon conversion of such Security immediately prior to such reclassification, change, consolidation, merger, sale or conveyance. Such supplemental indenture shall provide for adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Article XII. If, in the case of any such consolidation, merger, sale or conveyance, the stock or other securities and property (including cash) receivable thereupon by a holder of shares of Common Stock includes shares of stock or other securities and property (including cash) of a corporation other than the successor or purchasing corporation, as the case may be, in such consolidation, merger, sale or conveyance, then such supplemental indenture shall also be executed by such other corporation and shall contain such additional provisions to protect the interests of the Holders of the Securities as the Board of Directors shall reasonably consider necessary by reason of the foregoing. The provisions of this Section 12.5 shall similarly apply to successive consolidations, mergers, sales or conveyances. Within 30 days after the execution of such supplemental indenture the Company shall give notice of the execution of such supplemental indenture, with respect to Registered Securities affected by such supplemental indenture, by mailing a notice of the execution of such supplemental indenture to each Holder of Registered Securities at such Holder's address as it appears on the Securities register maintained by the Registrar and, with respect to Bearer Securities affected by such supplemental indenture, by publishing in an Authorized Newspaper notice of the execution of such supplemental indenture on two separate days. Neither the Trustee nor any Conversion Agent shall be under any responsibility to determine the correctness of any provisions contained in any such supplemental indenture relating either to the kind or amount of shares of stock or securities or property (including cash) receivable by Holders of Securities upon the conversion of their Securities after any such consolidation, merger, sale or conveyance or to any adjustment to be made with respect thereto, but, subject to the provisions of Sections 7.1 and 7.2, may accept as conclusive evidence of the correctness of any such provisions, and shall be protected in relying upon, the Officers' Certificate (which the Company shall be obligated to file with the Trustee prior to the execution of any such supplemental indenture) with respect thereto. 58 65 SECTION 12.6 NOTICE OF CERTAIN EVENTS. If: (a) the Company shall declare a dividend (or any other distribution) payable to the holders of Common Stock otherwise than in cash; or (b) the Company shall authorize the granting to the holders of Common Stock of rights to subscribe for or purchase any shares of stock of any class or of any other rights; or (c) the Company shall authorize any reclassification or change of the Common Stock (other than a subdivision or combination of its outstanding shares of Common Stock), or any consolidation or merger to which the Company is a party and for which approval of any stockholders of the Company is required, or the sale or conveyance of all or substantially all the property or business of the Company; or (d) there shall be authorized or ordered any voluntary or involuntary dissolution, liquidation or winding-up of the company; or (e) such other event shall occur as may be specified in any Securities issued pursuant to this Indenture. then, the Company shall cause to be filed at the office or agency maintained for the purpose of conversion of the Securities as provided in Section 4.2, and shall, with respect to Registered Securities convertible into Common Stock, cause to be mailed to each Holder of such Registered Securities, at such Holder's address as it shall appear on the Securities register maintained by the Registrar and, with respect to Bearer Securities convertible into Common Stock, cause to be published in an Authorized Newspaper on two separate days, at least 20 days before the date hereinafter specified (or the earlier of the dates hereinafter specified, in the event that more than one date is specified), a notice stating the date on which (1) a record is expected to be taken for the purpose of such dividend, distribution or rights, or if a record is not to be taken, the date as of which the holders of Common Stock of record to be entitled to such dividend, distribution or rights are to be determined, or (2) such reclassification, change, consolidation, merger, sale, conveyance, dissolution, liquidation or winding-up is expected to become effective and the date, if any is to be fixed, as of which it is expected that holders of Common Stock of record shall be entitled to exchange their shares of Common Stock for securities or other property deliverable upon such reclassification, change, consolidation, merger, sale, conveyance, dissolution, liquidation or winding-up. SECTION 12.7 TAXES ON CONVERSION. The Company will pay any and all documentary, stamp or similar taxes payable to the United States of America or any political subdivision or taxing authority thereof or therein in respect of the issue or delivery of shares of Common Stock on conversion of Securities pursuant thereto; provided, however, that the Company shall not be required to pay any tax which may be payable in respect of any transfer involved in the issue or delivery of shares of Common Stock in a name other than that of the Holder of the Securities to be converted (or payment of cash in lieu thereof to a 59 66 Person other than such Holder) and no such issue or delivery (or payment) shall be made unless and until the Person requesting such issue or delivery (or payment) has paid to the Company the amount of any such tax or has established, to the satisfaction of the Company, that such tax has been paid. The Company extends no protection with respect to any other taxes imposed in connection with conversion of Securities. SECTION 12.8 COMPANY TO PROVIDE STOCK. The Company shall reserve, free from preemptive rights, out of its authorized but unissued shares, sufficient shares to provide for the conversion of convertible Securities from time to time as such Securities are presented for Conversion, provided, however, that nothing contained herein shall be construed to preclude the Company from satisfying its obligations in respect of the conversion of Securities by delivery of repurchase shares of Common Stock which are held in the treasury of the Company. If any shares of Common Stock to be reserved for the purpose of conversion of Securities hereunder require registration with or approval of any governmental authority under any Federal or state law before such shares may be validly issued or delivered upon conversion, then the Company covenants that it will in good faith and as expeditiously as possible endeavor to secure such registration or approval, as the case may be; provided, however, that nothing in this Section 12.8 shall be deemed to affect in any way the obligations of the Company to convert Securities into Common Stock as provided in this Article XII. Before taking any action which would cause an adjustment reducing the Conversion Price below the then par value, if any, of the Common Stock, the Company will take all corporate action which may, in the Opinion of Counsel, be necessary in order that the Company may validly and legally issue fully paid and non-assessable shares of Common Stock at such adjusted Conversion Price. The Company covenants that all shares of Common Stock which may be issued upon conversion of Securities will upon issue be fully paid and non-assessable by the Company and free of preemptive rights. SECTION 12.9 DISCLAIMER OF RESPONSIBILITY FOR CERTAIN MATTERS. Neither the Trustee, the Conversion Agent nor any agent of either shall at any time be under any duty or responsibility to any Holder of Securities to determine whether any facts exist which may require any adjustment of the Conversion Price, or with respect to the Officers' Certificate referred to in Section 12.4(h), or with respect to the nature or extent of any such adjustment when made, or with respect to the method employed, or herein or in any supplemental indenture provided to be employed, in making the same. Neither the Trustee, the Conversion Agent nor any agent of either shall be accountable with respect to the validity of value (or the kind or amount) or any shares of Common Stock, or of any securities or property (including cash), which may at any time be issued or delivered upon the conversion of any Security; and neither the Trustee, the Conversion Agent nor any agent of either makes any representation with respect thereto. Neither the Trustee, the Conversion Agent nor any agent of either shall be responsible for any failure of the Company to issue, 60 67 register the transfer of or deliver any shares of Common Stock or stock certificates or other securities or property (including cash) upon the surrender of any Security for the purpose of conversion or, subject to Sections 7.1 and 7.2, to comply with any of the covenants of the Company contained in this Article XII. SECTION 12.10 RETURN OF FUNDS DEPOSITED FOR REDEMPTION OF CONVERTED SECURITIES. Any funds which at any time shall have been deposited by the Company or on its behalf with the Trustee or any Conversion Agent for the purpose of paying the principal of and interest, if any, on any of the Securities and which shall not be required for such purposes because of the conversion of such Securities, as provided in this Article XII, shall after such conversion be repaid to the Company by the Trustee or such Conversion Agent. SECTION 12.11 RIGHTS ISSUED IN RESPECT OF COMMON STOCK ISSUED UPON CONVERSION. Each share of Common Stock issued upon conversion of Securities pursuant to this Article XII shall be entitled to receive the appropriate number of preferred share purchase rights (the "Rights"), if any, and the certificates representing the Common Stock issued upon such conversion shall bear such legends, if any, in each case as provided by and subject to the terms of the Company's Rights Agreement, dated as of February 15, 1999 (such agreement, as may be amended from time to time, or any successor agreement, the "Rights Agreement"), as in effect at the time of such conversion. Notwithstanding anything else to the contrary in this Article XII, there shall not be any adjustment to the conversion privilege or conversion rate as a result of (i) the distribution of separate certificates representing the Rights, (ii) the occurrence of certain events entitling holders of Rights to receive, upon exercise thereof, Common Stock of the Company or Capital Stock of another corporation or (iii) the exercise of such Rights in accordance with the Rights Agreement. ARTICLE XIII MISCELLANEOUS SECTION 13.1 TRUST INDENTURE ACT CONTROLS. If any provision of this Indenture limits, qualifies or conflicts with the duties imposed by operation of subsection (c) of Section 318 of the TIA, the imposed duties shall control. SECTION 13.2 NOTICES. Any notice or communication by the Company or the Trustee to the other is duly given if in writing and delivered in person or by first class mail (postage prepaid, return receipt requested), telecopier or overnight air courier guaranteeing next day delivery, addressed as follows: 61 68 If to the Company: Great Lakes Chemical Corporation 500 East 96th Street, Suite 500 Indianapolis, Indiana 42640 Attention: General Counsel If to the Trustee: The First National Bank of Chicago One North State Street, Ninth Floor Chicago, Illinois 60670 Attention: Corporate Trust Administration The Company or the Trustee by notice to the others may designate additional or different addresses for subsequent notices or communications. Any notice or communication to the Company or the Trustee shall be deemed to have been duly given or made at the time delivered by hand if personally delivered; five calendar days after mailing if sent by first class mail; when receipt is acknowledged, if telecopied; and the next Business Day after timely delivery to the courier, if sent by overnight air courier guaranteeing next day delivery (except that a notice of change of address shall not be deemed to have been given until actually received by the addressee). Any notice or communication to a Holder of a Registered Security shall be mailed by first-class mail to such Securityholder's address shown on the register kept by the Registrar. Failure to mail a notice or communication to a Securityholder or any defect in-it shall not affect its sufficiency with respect to other Securityholders. If a notice or communication is mailed in the manner provided above within the time prescribed, it is duly given, whether or not the addressee receives it. If the Company mails a notice or communication to Securityholders, it shall mail a copy to the Trustee and each Agent at the same time. Any notice to be given to a Holder of Bearer Securities shall be given by publication in an Authorized Newspaper on two separate days within the time prescribed. SECTION 13.3 COMMUNICATION BY HOLDERS WITH OTHER HOLDERS. Securityholders may communicate pursuant to TIA Section 312(b) with other Securityholders with respect to their rights under this Indenture or the Securities. The Company, the Trustee, the Registrar and anyone else shall have the protection of TIA Section 312(c). 62 69 SECTION 13.4 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT. Upon any request or application by the Company to the Trustee to take or refrain from taking any action under this Indenture, the Company shall furnish to the Trustee: (a) an Officers' Certificate, in form and substance reasonably satisfactory to the Trustee, stating that, in the opinion of the signers, all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with; and (b) an Opinion of Counsel, in form and substance reasonably satisfactory to the Trustee, stating that, in the opinion of such counsel, all such conditions precedent have been complied with. SECTION 13.5 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION. Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include: (a) a statement that each party making such certificate or opinion has read such covenant or condition; (b) 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; (c) a statement that, in the opinion of each such party, such party has made such examination or investigation as is necessary to enable such party to express an informed opinion as to whether or not such covenant or condition has been complied with; and (d) a statement as to whether or not, in the opinion of each such party, such condition or covenant has been complied with; provided, however, that with respect to matters of law, an Officers' Certificate may be based upon an Opinion of Counsel, unless the signers know, or in the exercise of reasonable care should know, that such Opinion of Counsel is erroneous, and provided, further, that with respect to matters of fact, an Opinion of Counsel may rely on an Officers' Certificate or certificates of public officials, unless the signer knows, or in the exercise of reasonable care should know, that any such document is erroneous. SECTION 13.6 RULES BY TRUSTEE AND AGENTS. The Trustee may make reasonable rules for action by or at a meeting of Securityholders. The Registrar and the Paying Agent may make reasonable rules for their functions. 63 70 SECTION 13.7 LEGAL HOLIDAYS. If a payment date is a Legal Holiday at a place of payment, payment may be made at that place on the next succeeding Business Day, and no interest on the amount payable on such payment date shall accrue for the intervening period. SECTION 13.8 NO RECOURSE AGAINST OTHERS. A director, officer, employee or stockholder, as such, of the Company shall not have any liability for any obligations of the Company under the Securities or this Indenture or for any claim based on, in respect of or by reason of such obligations or their creation. Each Securityholder by accepting a Security waives and releases all such liability. The waiver and release are part of the consideration for the issue of Securities. SECTION 13.9 GOVERNING LAW. This Indenture and the Securities shall be governed by, and construed in accordance with, the laws of the State of New York applicable to agreements and instruments made and to be performed wholly within such State. SECTION 13.10 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS. This Indenture may not be used to interpret another indenture, loan or debt agreement of the Company or any Subsidiary. Any such indenture, loan or debt agreement may not be used to interpret this Indenture. SECTION 13.11 SUCCESSORS. All agreements of the Company in this Indenture and the Securities shall bind its successors. All agreements of the Trustee in this Indenture shall bind its successors. SECTION 13.12 SEVERABILITY. 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 13.13 MULTIPLE ORIGINALS. The parties may sign any number of copies of this Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. One signed copy is enough to prove this Indenture. 64 71 SECTION 13.14 TABLE OF CONTENTS; HEADINGS. The Table of Contents, Cross-Reference Table and Headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not intended to be considered a part hereof and shall not modify or restrict any of the terms or provisions hereof. SECTION 13.15 SECURITIES IN FOREIGN CURRENCIES. Wherever this Indenture provides for any action by, or the determination of any of the rights of, Holders of Securities of any series in which not all of such Securities are denominated in the same currency, or any distribution to Holders of Securities, in the absence of any provision to the contrary in the form of Security of any particular series, any amount in respect of any Security denominated in a currency other than United States dollars shall be treated for any such action, determination or distribution as that amount of United States dollars that could be obtained for such amount on such reasonable basis of exchange and as of such date as the Company may specify in a written notice to the Trustee, or in the absence of such notice, as the Trustee may determine. * * * * * 65 72 IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed, and their respective corporate seals to be affixed hereto and attested, all as of the date first above written. GREAT LAKES CHEMICAL CORPORATION By: ----------------------------------- Name: Title: THE FIRST NATIONAL BANK OF CHICAGO By: ----------------------------------- Name: Title: EX-5.1 3 OPINION OF KIRKLAND & ELLIS 1 EXHIBIT 5.1 [KIRKLAND & ELLIS LETTERHEAD] May 14, 1999 To: Great Lakes Chemical Corporation 500 East 97th Street Suite 500 Indianapolis, IN 46240 Re: Great Lakes Chemical Corporation Registration Statement on Form S-3 We are issuing this opinion in our capacity as special counsel to Great Lakes Chemical Corporation (the "Company"), in connection with the registration under the Securities Act of 1933, as amended (the "Act"), on a Registration Statement on Form S-3 to be filed with the Securities and Exchange Commission on or about May 14, 1999 (the "Registration Statement") of (i) unsecured debt securities, which may be either senior (the "Senior Debt Securities") or subordinated (the "Subordinated Debt Securities"), and which may be convertible into shares of common stock, par value $1.00 per share ("Common Stock") of the Company (the "Convertible Debt Securities," and, together with the Senior Debt Securities and the Subordinated Debt Securities, the "Debt Securities"); (ii) warrants to purchase Debt Securities (the "Debt Warrants"); (iii) shares of its series preferred stock (the "Series Preferred Stock"), which may be convertible into shares of Common Stock; (iv) shares of Common Stock; (v) warrants to purchase shares of Common Stock (the "Stock Warrants"); and (vi) warrants to receive from the Company the cash value in U.S. dollars of the right to purchase ("Currency Call Warrants") or to sell ("Currency Put Warrants," and, together with the Currency Call Warrants, the "Currency Warrants") such foreign currency or currency units as shall be designated by the Company at the time of the offering. The Debt Securities, Debt Warrants, Series Preferred Stock, Common Stock, Stock Warrants and Currency Warrants (collectively, the "Securities") may be issued by the Company either together or separately in connection with an offering or offerings from time to time pursuant to the Registration Statement and will be offered on terms set forth in the Registration Statement and in the prospectus contained in the Registration Statement (the "Prospectus") and in amounts, at prices and on other terms to be determined by the Company at the time of offering and to be set forth in an amendment or amendments to the Registration Statement and the Prospectus and in one or more supplements to the Prospectus (each, a "Prospectus Supplement"). 2 Great Lakes Chemical Corporation May 14, 1999 Page 2 The Debt Securities specified as Senior Debt Securities in the applicable Prospectus Supplement will be issued under an Indenture, the form of which is filed as an exhibit to the Registration Statement (such Indenture, as amended or supplemented from time to time, the "Senior Indenture"), between the Company and The First National Bank of Chicago, as Trustee. The Senior Indenture will be executed prior to the offering of any Senior Debt Securities. The Debt Securities specified as Subordinated Debt Securities in the applicable Prospectus Supplement will be issued under an Indenture the form of which is filed as an exhibit to the Registration Statement (such Indenture, as amended or supplemented from time to time, the "Subordinated Indenture"). The Subordinated Indenture will be executed by the Company and a trustee to be named and qualified under the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"), prior to the offering of any Subordinated Debt Securities. The executed Subordinated Indenture will be filed prior to the issuance of such Subordinated Debt Securities in an amendment to the Registration Statement or incorporated by reference into the Registration Statement pursuant to a Current Report on Form 8-K of the Company. Each series of Debt Warrants will be issued under a warrant agreement (each, a "Debt Warrant Agreement"), to be filed prior to the issuance of such Debt Warrants in an amendment to the Registration Statement or incorporated by reference into the Registration Statement pursuant to a Current Report on Form 8-K of the Company, to be executed by the Company and a warrant agent or agents to be named by the Company prior to the offering of any Debt Warrants of such series. Each series of Stock Warrants will be issued under a warrant agreement (each, a "Stock Warrant Agreement"), to be filed prior to the issuance of such Stock Warrants in an amendment to the Registration Statement or incorporated by reference into the Registration Statement pursuant to a Current Report on Form 8-K of the Company, to be executed by the Company and a warrant agent or agents to be named by the Company prior to the offering of any Stock Warrants of such series. Each series of Currency Warrants will be issued under a warrant agreement (each, a "Currency Warrant Agreement"), to be filed prior to the issuance of such Currency Warrants in an amendment to the Registration Statement or incorporated by reference into the Registration Statement pursuant to a Current Report on Form 8-K of the Company, to be entered by the Company and a warrant agent or agents to be named by the Company prior to the offering of any Currency Warrants of such series. The Registration Statement provides that the Company may sell the Securities registered thereby (i) through underwriters or dealers, (ii) directly to one or more other purchasers, (iii) through agents or (iv) to both investors and/or dealers through a specific bidding or auction process or otherwise. The applicable Prospectus Supplement with respect to the Securities offered will set forth the terms of the offering of such Securities, including the name or 3 Great Lakes Chemical Corporation May 14, 1999 Page 3 names of any underwriters, dealers or agents, the purchase price of such Securities and the proceeds to the Company from such sale, any underwriting discounts and other items constituting underwriters' compensation, any initial public offering price and any discounts, commissions or concessions allowed or reallowed or paid to dealers, and any bidding or auction process. If underwriters are used in an offering of Securities registered by the Registration Statement, the Registration Statement anticipates that the Company will sell such Securities pursuant to the terms of an underwriting agreement to be executed between the Company and underwriters that will be identified in the applicable Prospectus Supplement. We have for purposes of this letter reviewed the preliminary form of the underwriting agreement initially filed as an exhibit to the Registration Statement and we have assumed for purposes of this letter that the terms of the Underwriting Agreement will fall within the scope of the authorization adopted by the Company's Board of Directors and will receive the approvals required by that Board authorization. The term "Underwriting Agreement" is used in this letter to mean an underwriting agreement in the form in which it will be actually executed by the Company and the underwriters with respect to a particular underwritten offering of Securities registered by the Registration Statement. We have also assumed for purposes of this letter that the terms of any other agreement providing for the sale of Securities registered by the Registration Statement (other than by means of an underwritten offering), including a distribution agreement to be filed prior to a particular offering of Securities registered by the Registration Statement in an amendment to the Registration Statement or incorporated by reference into the Registration Statement pursuant to a Current Report on Form 8-K of the Company, to be executed by the Company and an appropriate party or parties that will be identified in the applicable Prospectus Supplement, will fall within the scope of the authorization adopted by the Company's Board of Directors and will receive the approvals required by that Board authorization. The term "Other Agreement" is used in this letter to mean an agreement providing for the sale of Securities registered by the Registration Statement (other than by means of an underwritten offering) in the form in which it will be actually executed by the Company and the appropriate party or parties with respect to a particular offering or offerings of Securities registered by the Registration Statement. The term "Agreement" is used in this letter to mean either an Underwriting Agreement or an Other Agreement. The terms "Registered Senior Debt Securities," "Registered Subordinated Debt Securities," "Registered Debt Warrants," "Registered Series Preferred Stock," "Registered Common Stock," "Registered Stock Warrants" and "Registered Currency Warrants" are used in this letter to mean, respectively, the Senior Debt Securities, the Subordinated Debt Securities, the Debt Warrants, the Series Preferred Stock, the Common Stock, the Stock Warrants and the Currency Warrants that are registered under the Registration Statement as initially filed and are sold by the Company under an Agreement. 4 Great Lakes Chemical Corporation May 14, 1999 Page 4 For purposes of this letter, we have examined originals, or copies certified or otherwise identified to our satisfaction, of such documents, corporate records and other instruments as we have deemed necessary for the purpose of this opinion, including (i) the corporate and organizational documents of the Company, (ii) minutes and records of the corporate proceedings of the Company with respect to the issuance of the Securities and (iii) the Registration Statement and the exhibits thereto. For purposes of this letter, we have assumed the authenticity of all documents submitted to us as originals, the conformity to the originals of all documents submitted to us as copies and the authenticity of the originals submitted to us as copies. We have also assumed the genuineness of the signatures of persons signing all documents in connection with which this opinion is rendered, the authority of such persons signing on behalf of the parties thereto other than the Company, and the due authorization, execution and delivery of all documents by the parties thereto other than the Company. As to any facts material to the opinions expressed herein which we have not independently established or verified, we have relied upon statements and representations of officers and other representatives of the Company and others. Subject to the assumptions, qualifications and limitations identified in this letter, we advise you that in our opinion: (1) Registered Senior Debt Securities of each series, when issued, will be binding obligations of the Company, enforceable against the Company in accordance with their terms, when, as and if (i) the Registration Statement shall have become effective pursuant to the provisions of the Act, (ii) appropriate corporate action shall have been taken by the Company to authorize (a) the form, terms, execution and delivery of any necessary supplemental indenture or amendment to the Senior Indenture (and the Senior Indenture and any such supplemental indenture or amendment shall have been duly executed and delivered by the Company and the trustee thereunder) and (b) the form and terms of such series of Registered Senior Debt Securities, (iii) such series of Registered Senior Debt Securities shall have been issued in the form and containing the terms described in the Registration Statement, any applicable Prospectus Supplements, the Senior Indenture and such corporate action, (iv) a Prospectus Supplement or Prospectus Supplements with respect to such series of Registered Senior Debt Securities shall have been filed (or transmitted for filing) with the Securities and Exchange Commission (the "Commission") pursuant to Rule 424(b) of the Act and any exhibits necessary under the rules and regulations of the Commission shall have been filed with the Commission in an amendment to the Registration Statement or incorporated by reference into the Registration Statement pursuant to a 5 Great Lakes Chemical Corporation May 14, 1999 Page 5 Current Report on Form 8-K of the Company filed with the Commission, (v) any legally required consents, approvals, authorizations and other orders of the Commission and any other regulatory authorities shall have been obtained and (vi) Registered Senior Debt Securities of such series shall have been duly executed and authenticated as provided in the Senior Indenture and duly delivered to the purchasers thereof against payment of the agreed consideration therefor in accordance with the applicable Agreement. (2) Registered Subordinated Debt Securities of each series, when issued, will be binding obligations of the Company, enforceable against the Company in accordance with their terms, when, as and if (i) the Registration Statement shall have become effective pursuant to the provisions of the Act, (ii) appropriate corporate action shall have been taken by the Company to authorize (a) the form, terms, execution and delivery of the Subordinated Indenture and any necessary supplemental indenture or amendment to the Subordinated Indenture (and the Subordinated Indenture and any such supplemental indenture or amendment shall have been duly executed and delivered by the Company and the trustee thereunder) and (b) the form and terms of such series of Registered Subordinated Debt Securities, (iii) the trustee under the Subordinated Indenture shall have been qualified under the Trust Indenture Act, (iv) such series of Registered Subordinated Debt Securities shall have been issued in the form and containing the terms described in the Registration Statement, any applicable Prospectus Supplements, the Subordinated Indenture and such corporate action, (v) a Prospectus Supplement or Prospectus Supplements with respect to such series of Registered Subordinated Debt Securities shall have been filed (or transmitted for filing) with the Commission pursuant to Rule 424(b) of the Act and any exhibits necessary under the rules and regulations of the Commission, including the executed Subordinated Indenture, shall have been filed with the Commission in an amendment to the Registration Statement or incorporated by reference into the Registration Statement pursuant to a Current Report on Form 8-K of the Company filed with the Commission, (vi) any legally required consents, approvals, authorizations and other orders of the Commission and any other regulatory authorities shall have been obtained and (vii) Registered Subordinated Debt Securities of such series shall have been duly executed and authenticated as provided in the Senior Indenture and duly delivered to the purchasers thereof against payment of the agreed consideration therefor in accordance with the applicable Agreement. (3) Registered Debt Warrants of each series, when issued, will be binding obligations of the Company, enforceable against the Company in accordance with their terms when, as and if (i) the Registration Statement shall have become effective pursuant to the provisions of the Act, (ii) appropriate corporate action shall have been taken by the Company to authorize the form, 6 Great Lakes Chemical Corporation May 14, 1999 Page 6 terms, execution and delivery of a Debt Warrant Agreement for such series of Registered Debt Warrants, including a form of certificate evidencing such series of Registered Debt Warrants (and such Debt Warrant Agreement shall have been duly executed and delivered by the Company and the warrant agent or agents thereunder), (iii) a Prospectus Supplement or Prospectus Supplements with respect to such series of Registered Debt Warrants shall have been filed (or transmitted for filing) with the Commission pursuant to Rule 424(b) of the Act and any exhibits necessary under the rules and regulations of the Commission, including such Debt Warrant Agreement, shall have been filed with the Commission in an amendment to the Registration Statement or incorporated by reference into the Registration Statement pursuant to a Current Report on Form 8-K of the Company filed with the Commission, (iv) any legally required consents, approvals, authorizations and other orders of the Commission and any other regulatory authorities shall have been obtained and (v) Registered Debt Warrants of such series are duly executed, attested and issued by duly authorized officers of the Company, countersigned by the applicable warrant agent and delivered to the purchasers thereof against payment of the agreed consideration therefor in the manner provided for in the Registration Statement, any applicable Prospectus Supplements, such Debt Warrant Agreement, the applicable Agreement and such corporate action. (4) Shares of each series of Registered Series Preferred Stock will be validly issued, fully paid and nonassessable when, as and if (i) the Registration Statement shall have become effective pursuant to the provisions of the Act, (ii) appropriate corporate action shall have been taken to authorize the issuance of such series of Registered Series Preferred Stock, to fix the terms thereof and to authorize the execution and filing of a Certificate of Designations relating thereto with the Secretary of State of the State of Delaware, (iii) such Certificate of Designations shall have been executed by duly authorized officers of the Company and so filed by the Company, all in accordance with the laws of the State of Delaware and any legally required consents, approvals, authorizations and other orders of the Commission and any other regulatory authorities are obtained, (iv) a Prospectus Supplement or Prospectus Supplements with respect to such series of Registered Series Preferred Stock shall have been filed (or transmitted for filing) with the Commission pursuant to Rule 424(b) of the Act and any exhibits necessary under the rules and regulations of the Commission, including such Certificate of Designations, shall have been filed with the Commission in an amendment to the Registration Statement or incorporated by reference into the Registration Statement pursuant to a Current Report on Form 8-K of the Company filed with the Commission, (v) Registered Series Preferred Stock of such series with terms so fixed shall have been duly issued and delivered by the Company against payment therefor in accordance with such corporate action and the applicable Agreement and (vi) certificates 7 Great Lakes Chemical Corporation May 14, 1999 Page 7 representing shares of such series of Registered Series Preferred Stock shall have been duly executed by the duly authorized officers of the Company in accordance with applicable law. (5) Shares of Registered Common Stock will be validly issued, fully paid and nonassessable when, as and if (i) the Registration Statement shall have become effective pursuant to the provisions of the Act, (ii) appropriate corporate action shall have been taken to authorize the issuance and sale of such Registered Common Stock, (iii) a Prospectus Supplement or Prospectus Supplements with respect to the shares of Registered Common Stock shall have been filed (or transmitted for filing) with the Commission pursuant to Rule 424(b) of the Act and any exhibits necessary under the rules and regulations of the Commission shall have been filed with the Commission in an amendment to the Registration Statement or incorporated by reference into the Registration Statement pursuant to a Current Report on Form 8-K of the Company filed with the Commission, (iv) any legally required consents, approvals, authorizations and other orders of the Commission and any other regulatory authorities shall have been obtained and (v) appropriate certificates representing the shares of Registered Common Stock are duly executed, countersigned by the Company's transfer agent/registrar, registered and delivered against payment of the agreed consideration therefor in accordance with the applicable Agreement. (6) Registered Stock Warrants of each series, when issued, will be binding obligations of the Company, enforceable against the Company in accordance with their terms when, as and if (i) the Registration Statement shall have become effective pursuant to the provisions of the Act, (ii) appropriate corporate action shall have been taken by the Company to authorize the form, terms, execution and delivery of a Stock Warrant Agreement for such series of Registered Stock Warrants, including a form of certificate evidencing such series of Registered Stock Warrants (and such Stock Warrant Agreement shall have been duly executed and delivered by the Company and the warrant agent or agents thereunder), (iii) a Prospectus Supplement or Prospectus Supplements with respect to such series of Registered Stock Warrants shall have been filed (or transmitted for filing) with the Commission pursuant to Rule 424(b) of the Act and any exhibits necessary under the rules and regulations of the Commission, including such Stock Warrant Agreement, shall have been filed with the Commission in an amendment to the Registration Statement or incorporated by reference into the Registration Statement pursuant to a Current Report on Form 8-K of the Company filed with the Commission, (iv) any legally required consents, approvals, authorizations and other orders of the Commission and any other regulatory authorities shall have been obtained and (v) Registered Stock Warrants of such series are duly executed, attested and issued by duly authorized officers of the Company, countersigned by the applicable warrant agent and delivered to the purchasers thereof against payment of the agreed 8 Great Lakes Chemical Corporation May 14, 1999 Page 8 consideration therefor in the manner provided for in the Registration Statement, any applicable Prospectus Supplements, such Stock Warrant Agreement, the applicable Agreement and such corporate action. (7) Registered Currency Warrants of each series, when issued, will be binding obligations of the Company, enforceable against the Company in accordance with their terms when, as and if (i) the Registration Statement shall have become effective pursuant to the provisions of the Act, (ii) appropriate corporate action shall have been taken by the Company to authorize the form, terms, execution and delivery of a Currency Warrant Agreement for such series of Registered Currency Warrants, including a form of certificate evidencing such series of Registered Currency Warrants (and such Currency Warrant Agreement shall have been duly executed and delivered by the Company and the warrant agent or agents thereunder), (iii) a Prospectus Supplement or Prospectus Supplements with respect to such series of Registered Currency Warrants shall have been filed (or transmitted for filing) with the Commission pursuant to Rule 424(b) of the Act and any exhibits necessary under the rules and regulations of the Commission, including such Currency Warrant Agreement, shall have been filed with the Commission in an amendment to the Registration Statement or incorporated by reference into the Registration Statement pursuant to a Current Report on Form 8-K of the Company filed with the Commission, (iv) any legally required consents, approvals, authorizations and other orders of the Commission and any other regulatory authorities shall have been obtained and (v) Registered Currency Warrants of such series are duly executed, attested and issued by duly authorized officers of the Company, countersigned by the applicable warrant agent and delivered to the purchasers thereof against payment of the agreed consideration therefor in the manner provided for in the Registration Statement, any applicable Prospectus Supplements, such Currency Warrant Agreement, the applicable Agreement and such corporate action. Our advice on every legal issue addressed in this letter is based exclusively on the internal law of New York and the General Corporation Law of the State of Delaware (under which the Company is incorporated). Our opinions expressed above are subject to the qualifications that we express no opinion as to the applicability of, compliance with, or effect of (i) any bankruptcy, insolvency, reorganization, fraudulent transfer, fraudulent conveyance, moratorium or other similar law or judicially developed doctrine in this area (such as substantive consolidation or equitable subordination) affecting the enforcement of creditors' rights generally, (ii) general principles of equity (regardless of whether enforcement is considered in a proceeding in equity or at law), (iii) 9 Great Lakes Chemical Corporation May 14, 1999 Page 9 an implied covenant of good faith and fair dealing, (iv) public policy considerations which may limit the rights of parties to obtain certain remedies, (v) any requirement that a claim with respect to any security denominated in other than U.S. dollars (or a judgment denominated in other than U.S. dollars in respect of such claim) be converted into U.S. dollars at a rate of exchange prevailing on a date determined in accordance with applicable law, (vi) governmental authority to limit, delay or prohibit the making of payments outside of the United States or in a foreign currency or currency unit and (vii) any laws except the laws of the State of New York and the General Corporation Law of the State of Delaware. We advise you that issues addressed by this letter may be governed in whole or in part by other laws, but we express no opinion as to whether any relevant difference exists between the laws upon which our opinions are based and any other laws which may actually govern. For purposes of rendering our opinions expressed above, we have assumed that (i) the Registration Statement remains effective during the offer and sale of the particular Securities, (ii) the terms of the (a) the Senior Indenture, as executed or as thereafter amended, (b) the Subordinated Indenture, as executed or as thereafter amended, (c) any supplemental indenture to the Senior Indenture or the Subordinated Indenture, (d) any Debt Warrant Agreement, (e) any Certificate of Designations, (f) any Stock Warrant Agreement or (g) any Currency Warrant Agreement, each as applicable to the particular Securities, are consistent with the description of the terms of such indenture, agreement or certificate set forth in the Registration Statement and in the Prospectus, (iii) at the time of the issuance, sale and delivery of each such Security (x) the authorization of such Security by the Company will not have been modified or rescinded, and there will not have occurred any change in law affecting the validity, legally binding character or enforceability of such Security and (y) the issuance, sale and delivery of such Security, the terms of such Security and compliance by the Company with the terms of such Security will not violate any applicable law, any agreement or instrument then binding upon the Company (including, but not limited to, any Agreement, any supplemental indenture to the Senior Indenture or the Subordinated Indenture, any Debt Warrant Agreement, any Certificate of Designations, any Stock Warrant Agreement or any Currency Warrant Agreement) or any restriction imposed by any court or governmental body having jurisdiction over the Company and (iv) any revisions to the form of (a) Subordinated Indenture or (b) Senior Indenture, each filed as exhibits to the Registration Statement prior to the execution thereof, and any amendments or supplemental indentures to the Senior Indenture (as executed) or the Subordinated Indenture (as executed), will not require requalification of such indenture under the Trust Indenture Act. 10 Great Lakes Chemical Corporation May 14, 1999 Page 10 We do not find it necessary for the purposes of this opinion, and accordingly we do not purport to cover herein, the application of the securities or "Blue Sky" laws of the various states to the issuance of the Securities. This opinion is limited to the specific issues addressed herein, and no opinion may be inferred or implied beyond that expressly stated herein. We assume no obligation to revise or supplement this opinion should the present laws of the State of New York or the General Corporation Law of the State of Delaware be changed by legislative action, judicial decision or otherwise. This opinion is furnished to you in connection with the filing of the Registration Statement and is not to be used, circulated, quoted or otherwise relied upon for any other purposes. We hereby consent to the filing of this opinion as Exhibit 5.1 to the Registration Statement. We also consent to the reference to our firm under the heading "Legal Opinion" in the Prospectus. In giving this consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Act of the rules and regulations of the Commission. Very Truly Yours, /s/ KIRKLAND & ELLIS Kirkland & Ellis EX-12.1 4 COMPUTATION OF RATIO OF EARNINGS 1 Exhibit 12.1 STATEMENT RE: COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (dollars in thousands)
Three Months Ended March 31, 1999 1998 1997 1996 1995 1994 - --------------------------------------------------------------------------------------------------------------------- Earnings: Consolidated income from continuing operations before income taxes ............... $ 47,032 $ 66,275 $ 117,170 $ 184,015 $ 200,222 $ 169,700 Fixed charges ......................... 9,005 38,782 39,826 30,816 26,484 16,485 Less interest capitalized during the period ................. (1,300) (6,000) (6,000) (6,000) (6,187) (1,737) Amortization of capitalized interest... 667 2,936 2,454 1,923 1,412 1,316 -------------------------------------------------------------------------- Total earnings .............. $ 55,404 $ 101,993 $ 153,450 $ 210,754 $ 221,931 $ 185,764 ========================================================================== Fixed charges: Interest expense ...................... $ 5,603 $ 24,820 $ 28,408 $ 18,496 $ 13,538 $ 8,801 Interest capitalized during the period ........................ 1,300 6,000 6,000 6,000 6,187 1,737 Interest portion of rent expense ........................... 2,102 7,962 5,418 6,320 6,759 5,947 -------------------------------------------------------------------------- Total fixed charges ......... $ 9,005 $ 38,782 $ 39,826 $ 30,816 $ 26,484 $ 16,485 ========================================================================== Ratio of earnings to fixed charges ..... 6.2 2.6 3.9 6.8 8.4 11.3 ==========================================================================
Page 1 EX-23.1 5 CONSENT ERNST & YOUNG LLP 1 EXHIBIT 23.1 CONSENT OF INDEPENDENT AUDITORS We consent to the reference to our firm under the caption "Experts" in the Registration Statement (Form S-3) and related Prospectus of Great Lakes Chemical Corporation for the shelf registration pertaining to future issuance of shares of its common stock, rights and common stock warrants and/or issuance of debt securities, debt warrants and currency warrants and to the incorporation by reference therein of our reports dated February 26, 1999 and March 25, 1999 with respect to the consolidated financial statements of Great Lakes Chemical Corporation incorporated by reference in its Annual Report (Form 10-K) for the year ended December 31, 1998 and the related financial statement schedule included therein, filed with the Securities and Exchange Commission. Indianapolis, Indiana May 11, 1999 EX-25.1 6 STATEMENT OF ELIGIBILITY 1 EXHIBIT 25.1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM T-1 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b(2) --------------- THE FIRST NATIONAL BANK OF CHICAGO (EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER) A NATIONAL BANKING ASSOCIATION 36-0899825 (I.R.S. EMPLOYER IDENTIFICATION NUMBER) ONE FIRST NATIONAL PLAZA, CHICAGO, ILLINOIS 60670-0126 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE) THE FIRST NATIONAL BANK OF CHICAGO ONE FIRST NATIONAL PLAZA, SUITE 0286 CHICAGO, ILLINOIS 60670-0286 ATTN: LYNN A. GOLDSTEIN, LAW DEPARTMENT (312) 732-6919 (NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE) --------------- GREAT LAKES CHEMICAL CORPORATION (EXACT NAME OF OBLIGORS AS SPECIFIED IN THEIR TRUST AGREEMENTS) DELAWARE 95-1765035 (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER) 500 EAST 96TH STREET, SUITE 500 INDIANAPOLIS, INDIANA 46240 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE) DEBT SECURITIES (TITLE OF INDENTURE SECURITIES) 2 ITEM 1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO THE TRUSTEE: (A) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO WHICH IT IS SUBJECT. Comptroller of Currency, Washington, D.C.; Federal Deposit Insurance Corporation, Washington, D.C.; The Board of Governors of the Federal Reserve System, Washington D.C.. (B) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS. The trustee is authorized to exercise corporate trust powers. ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH AFFILIATION. No such affiliation exists with the trustee. ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A PART OF THIS STATEMENT OF ELIGIBILITY. 1. A copy of the articles of association of the trustee now in effect.* 2. A copy of the certificates of authority of the trustee to commence business.* 3. A copy of the authorization of the trustee to exercise corporate trust powers.* 4. A copy of the existing by-laws of the trustee.* 5. Not Applicable. 6. The consent of the trustee required by Section 321(b) of the Act. 3 7. A copy of the latest report of condition of the trustee published pursuant to law or the requirements of its supervising or examining authority. 8. Not Applicable. 9. Not Applicable. Pursuant to the requirements of the Trust Indenture Act of 1939, as amended, the trustee, The First National Bank of Chicago, a national banking association organized and existing under the laws of the United States of America, has duly caused this Statement of Eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of Chicago and State of Illinois, on the 13th day of May, 1999. THE FIRST NATIONAL BANK OF CHICAGO, TRUSTEE BY /s/ SANDRA L. CARUBA -------------------------------------------------------- SANDRA L. CARUBA VICE PRESIDENT * EXHIBIT 1, 2, 3 AND 4 ARE HEREIN INCORPORATED BY REFERENCE TO EXHIBITS BEARING IDENTICAL NUMBERS IN ITEM 16 OF THE FORM T-1 OF THE FIRST NATIONAL BANK OF CHICAGO, FILED AS EXHIBIT 25 TO THE REGISTRATION STATEMENT ON FORM S-3 OF U S WEST CAPITAL FUNDING, INC., FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 6, 1998 (REGISTRATION NO. 333-51907-01). 4 EXHIBIT 6 THE CONSENT OF THE TRUSTEE REQUIRED BY SECTION 321(b) OF THE ACT May 13, 1999 Securities and Exchange Commission Washington, D.C. 20549 Ladies and Gentlemen: In connection with the qualification of the Indenture by and between Great Lakes Chemical Corporation and The First National Bank of Chicago, as Trustee, the undersigned, in accordance with Section 321(b) of the Trust Indenture Act of 1939, as amended, hereby consents that the reports of examinations of the undersigned, made by Federal or State authorities authorized to make such examinations, may be furnished by such authorities to the Securities and Exchange Commission upon its request therefor. Very truly yours, THE FIRST NATIONAL BANK OF CHICAGO BY: /s/ SANDRA L. CARUBA ----------------------------------------- SANDRA L. CARUBA VICE PRESIDENT 5 EXHIBIT 7 Legal Title of Bank: The First National Bank of Chicago Call Date: 12/31/98 ST-BK: 17-1630 FFIEC 031 Address: One First National Plaza, Ste 0460 Page RC-1 City, State Zip: Chicago, IL 60670 FDIC Certificate No.: 0/3/6/1/8
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL AND STATE-CHARTERED SAVINGS BANKS FOR DECEMBER 31, 1998 All schedules are to be reported in thousands of dollars. Unless otherwise indicated, report the amount outstanding of the last business day of the quarter. SCHEDULE RC--BALANCE SHEET
DOLLAR AMOUNTS IN THOUSANDS C400 RCFD BIL MIL THOU ---- ---- ------------ ASSETS 1. Cash and balances due from depository institutions (from Schedule RC-A): RCFD ---- a. Noninterest-bearing balances and currency and coin(1) ........................ 0081 5,585,982 1.a b. Interest-bearing balances(2).................. ............................... 0071 4,623,842 1.b 2. Securities a. Held-to-maturity securities(from Schedule RC-B, column A) .................... 1754 0 2.a b. Available-for-sale securities (from Schedule RC-B, column D)............ ..... 1773 11,181,405 2.b 3. Federal funds sold and securities purchased under agreements to resell 1350 9,853,544 3. 4. Loans and lease financing receivables: RCFD ---- a. Loans and leases, net of unearned income (from Schedule RC-C)................. 2122 31,155,998 4.a b. LESS: Allowance for loan and lease losses..................................... 3123 411,963 4.b c. LESS: Allocated transfer risk reserve......................................... 3128 3,884 4.c RCFD d. Loans and leases, net of unearned income, allowance, and ..................... ---- reserve (item 4.a minus 4.b and 4.c).......................................... 2125 30,740,151 4.d 5. Trading assets (from Schedule RD-D).............................................. 3545 7,635,778 5. 6. Premises and fixed assets (including capitalized leases) ........................ 2145 739,925 6. 7. Other real estate owned (from Schedule RC-M) .................................... 2150 4,827 7. 8. Investments in unconsolidated subsidiaries and associated companies (from Schedule RC-M)................................................... 2130 202,359 8. 9. Customers' liability to this bank on acceptances outstanding .................... 2155 269,516 9. 10. Intangible assets (from Schedule RC-M)........................................... 2143 291,665 10. 11. Other assets (from Schedule RC-F)................................................ 2160 3,071,912 11. 12. Total assets (sum of items 1 through 11)......................................... 2170 74,200,906 12.
- -------------- (1) Includes cash items in process of collection and unposted debits. (2) Includes time certificates of deposit not held for trading. 6 Legal Title of Bank: The First National Bank of Chicago Call Date: 12/31/98 ST-BK: 17-1630 FFIEC 031 Address: One First National Plaza, Ste 0460 Page RC-2 City, State Zip: Chicago, IL 60670 FDIC Certificate No.: 0/3/6/1/8
SCHEDULE RC-CONTINUED
DOLLAR AMOUNTS IN THOUSANDS ----------------- LIABILITIES 13. Deposits: RCON a. In domestic offices (sum of totals of columns A and C ---- from Schedule RC-E, part 1)................................................ 2200 22,524,140 13.a (1) Noninterest-bearing(1)................................................. 6631 10,141,937 13.a1 (2) Interest-bearing....................................................... 6636 12,382,203 13.a2 RCFN b. In foreign offices, Edge and Agreement subsidiaries, and ---- IBFs (from Schedule RC-E, part II)... ..................................... 2200 19,691,237 13.b (1) Noninterest bearing.................................................... 6631 408,126 13.b1 (2) Interest-bearing....................................................... 6636 19,283,111 13.b2 14. Federal funds purchased and securities sold under agreements to repurchase: RCFD 2800 9,113,686 14 15. a. Demand notes issued to the U.S. Treasury RCON 2840 120,599 15.a b. Trading Liabilities(from Schedule RC-D) RCFD 3548 6,797,927 15.b 16. Other borrowed money: RCFD ---- a. With original maturity of one year or less................................. 2332 5,385,355 16.a b. With original maturity of more than one year.............................. A547 327,126 16.b c. With original maturity of more than three years ........................... A548 316,411 16.c 17. Not applicable 18. Bank's liability on acceptance executed and outstanding ...................... 2920 269,516 18. 19. Subordinated notes and debentures............................................. 3200 2,400,000 19. 20. Other liabilities (from Schedule RC-G)........................................ 2930 2,137,443 20. 21. Total liabilities (sum of items 13 through 20)................................ 2948 69,083,440 21. 22. Not applicable EQUITY CAPITAL 23. Perpetual preferred stock and related surplus................................. 3838 0 23. 24. Common stock.................................................................. 3230 200,858 24. 25. Surplus (exclude all surplus related to preferred stock) ..................... 3839 3,201,435 25. 26. a. Undivided profits and capital reserves..................................... 3632 1,695,446 26.a b. Net unrealized holding gains (losses) on available-for-sale securities................................................................. 8434 6,349 26.b 27. Cumulative foreign currency translation adjustments .......................... 3284 13,378 27. 28. Total equity capital (sum of items 23 through 27) ............................ 3210 5,117,466 28. 29. Total liabilities, limited-life preferred stock, and equity capital (sum of items 21, 22, and 28)......................................... 3300 74,200,906 29.
Memorandum To be reported only with the March Report of Condition. 1. Indicate in the box at the right the number of the statement below that best describes the most comprehensive level of auditing work performed for the bank by independent external auditors as of any date during 1996.............................. RCFD 6724 1 [ ] Independent audit of the bank conducted in accordance with generally accepted auditing standards by a certified public accounting firm which submits a report on the bank 2 [ ] Independent audit of the bank's parent holding company conducted in accordance with generally accepted auditing standards by a certified public accounting firm which submits a report on the consolidated holding company (but not on the bank separately) 3 [ ] Directors' examination of the bank conducted in accordance with generally accepted auditing standards by a certified public accounting firm (may be required by state chartering authority) 4 [ ] Directors' examination of the bank performed by other external auditors (may be required by state chartering authority) 5 [ ] Review of the bank's financial statements by external auditors 6 [ ] Compilation of the bank's financial statements by external auditors 7 [ ] Other audit procedures (excluding tax preparation work) 8 [ ] No external audit work - --------------- (1) Includes total demand deposits and noninterest-bearing time and savings deposits. -----END PRIVACY-ENHANCED MESSAGE-----