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SALOMON INC
TO
BANKERS TRUST COMPANY
Trustee
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THIRD SUPPLEMENTAL INDENTURE
Dated as of July 3, 1996
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9 1/4% Subordinated Debt Securities
due June 30, 2026
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This THIRD SUPPLEMENTAL INDENTURE (the "Third Supplemental
Indenture"), is made and entered into as of July 3, 1996, between
Salomon Inc, a Delaware corporation (the "Company"), and Bankers
Trust Company, a New York banking corporation (the "Trustee"), as
Trustee under the Indenture dated as of December 1, 1988, as
supplemented as of September 7, 1990 and December 14, 1993,
between the Company and the Trustee (as supplemented to the date
hereof, the "Indenture").
WHEREAS, the Company executed and delivered the Indenture
to the Trustee to provide for the future issuance of the
Company's unsecured subordinated debt securities to be issued
from time to time in one or more series as might be determined by
the Company, in an unlimited aggregate principal amount which may
be authenticated and delivered as provided in the Indenture;
WHEREAS, pursuant to the terms of the Indenture, the
Company desires to provide for the establishment of a new series
of its debt securities to be known as its 9 1/4% Subordinated
Debt Securities due June 30, 2026 (the "Subordinated Debt
Securities"), the form and substance of such Subordinated Debt
Securities and the terms, provisions and conditions thereof to be
set forth as provided in the Indenture and this Third
Supplemental Indenture;
WHEREAS, SI Financing Trust I, a Delaware statutory
business trust (the "Trust"), has offered to the public
$345,000,000 aggregate liquidation amount of its 9 1/4% Trust
Preferred Securities (the "Preferred Securities") and has issued
to the Company, as sponsor, its 9 1/4% Trust Common Securities
(the "Common Securities," and together with the Preferred
Securities, the "Trust Securities"), representing undivided
beneficial interests in the assets of the Trust and proposes to
invest the proceeds from such offering in $355,670,100 aggregate
principal amount of the Subordinated Debt Securities; and
WHEREAS, the Company has requested that the Trustee execute
and deliver this Third Supplemental Indenture, and all
requirements necessary to make this Third Supplemental Indenture
a valid instrument, in accordance with its terms, and to make the
Subordinated Debt Securities, when executed by the Company and
authenticated and delivered by the Trustee, the valid obligations
of the Company, have been performed, and the execution and
delivery of this Third Supplemental Indenture have been duly
authorized in all respects:
NOW THEREFORE, in consideration of the purchase and
acceptance of the Subordinated Debt Securities by the Holders
thereof, and for the purpose of setting forth, as provided in the
Indenture, the form and substance of the Subordinated Debt
Securities and the terms, provisions and conditions thereof, the
Company covenants and agrees with the Trustee as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 Definition of Terms.
Unless otherwise specified herein:
(a) a term defined in the Indenture has the same meaning
when used in this Third Supplemental Indenture;
(b) a term defined anywhere in this Third Supplemental
Indenture has the same meaning throughout;
(c) the singular includes the plural and vice versa;
(d) a reference to a Section or Article is to a Section or
Article of this Third Supplemental Indenture;
(e) headings are for convenience of reference only and do
not affect interpretation;
(f) the following terms have the meanings given to them in
the Declaration: (i) Business Day; (ii) Clearing Agency; (iii)
Common Security Certificate; (iv) Common Securities Guarantee;
(v) Delaware Trustee; (vi) Dissolution Tax Opinion; (vii) Fifth
Anniversary Put Option Exercise Date; (viii) Initial Put Option
Exercise Date; (ix) No Recognition Opinion; (x) Optional
Distribution; (xi) Preferred Securities Guarantee; (xii)
Preferred Security Certificate; (xiii) Property Trustee; (xiv)
Put Option Exercise Date; (xv) Redemption Tax Opinion; (xvi)
Regular Trustee; (xvii) Special Event; (xviii) Tax Event; and
(xix ) Underwriting Agreement;
(g) the following terms have the meaning given to them in the
Unit Agreement: (i) Cash Settlement; (ii) Collateral Agent; (iii)
Collateral Settlement; (iv) Delayed Purchase Date; (v) Early
Purchase Date; (vi) Purchase Contract; (vii) Purchase Date;
(viii) Put Default; and (ix) Stated Purchase Date; and
(h) the following terms have the meanings given to them in
this Section 1.1(h):
"Additional Interest" has the meaning set forth in Section
2.5(c).
"Coupon Rate" has the meaning set forth in Section 2.5(a).
"Declaration" means the Amended and Restated Declaration of
Trust of the Trust, dated as of the date hereof, among the
Company, as sponsor, the trustees named therein and the holders
from time to time of undivided beneficial interests in the assets
of the Trust.
"Dissolution Event" means that as a result of the
occurrence and continuation of a Special Event or the election by
the Company to make an Optional Distribution, the Trust is to
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be dissolved in accordance with the Declaration and the
Subordinated Debt Securities held by the Trustee are to be
distributed to the holders of the Trust Securities issued by the
Trust pro rata in accordance with the Declaration.
"Exchange Act" means the Securities Exchange Act of 1934,
as amended from time to time or any successor legislation.
"Maturity Date" means the date on which the Subordinated
Debt Securities mature and on which the principal shall be due
and payable together with all accrued and unpaid interest
thereon.
"Ministerial Action" has the meaning set forth in Section
3.1.
"90 Day Period" has the meaning set forth in Section 3.1.
"Non-Book-Entry Preferred Securities" has the meaning set
forth in Section 2.4(a).
"Payment Date" has the meaning set forth in Section 2.5(a)
and shall be deemed to be an "Interest Payment Date" for all
purposes under the Indenture.
"Subordinated Debt Put Option" has the meaning set forth in
Section 4.1.
"Subordinated Debt Redemption Price" has the meaning set
forth in Section 3.2.
"Subordinated Debt Repayment Price" has the meaning set
forth in Section 4.1.
"Unit Agreement" means the Unit Agreement, dated as of July
3, 1996, among the Company, the Trust and Chemical Bank, a New
York banking corporation, as Agent.
"Units" means the 9 1/2% Trust Preferred StockSM (TRUPS SM)
Units, each consisting of a Preferred Security and a related
contract requiring the purchase of one Depositary Share
representing a one-twentieth interest in a share of 9.50%
Cumulative Preferred Stock, Series F, liquidation preference $500
per share, of the Company.
ARTICLE II
GENERAL TERMS AND CONDITIONS
OF THE SUBORDINATED DEBT SECURITIES
SECTION 2.1 Designation and Principal Amount.
There is hereby authorized a series of debt securities
designated the "9 1/4% Subordinated Debt Securities due June 30,
2026", in an aggregate principal amount equal to
$355,670,100, which amount shall be as set forth in the Company
Order for the authentication and delivery of Subordinated Debt
Securities pursuant to Section 303 of the Indenture.
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Subordinated Debt Securities may also be authenticated and
delivered under the Indenture upon reregistration of, transfer
of, or in exchange for, or in lieu of, other Subordinated Debt
Securities pursuant to Section 304, 305, 306, or 1106 of the
Indenture. The Subordinated Debt Securities shall be issued at
any time on or after the date hereof.
SECTION 2.2 Maturity.
The Maturity Date will be June 30, 2026.
SECTION 2.3 Form and Payment.
Except as provided in Section 2.4, the Subordinated Debt
Securities shall be issued as Registered Securities in
certificated form without interest coupons in minimum
denominations of $25 and integral multiples thereof. Principal
and interest (including Additional Interest, if any) on the
Subordinated Debt Securities will be payable, the transfer of
such Subordinated Debt Securities will be registrable and such
Subordinated Debt Securities will be exchangeable for
Subordinated Debt Securities bearing identical terms and
provisions at the Corporate Trust Office; provided, however, that
payment of interest may be made at the option of the Company by
check mailed to the Registered Holder at such address as shall
appear in the Security Register. Notwithstanding the foregoing,
so long as the Holder of any Subordinated Debt Securities is the
Property Trustee or the Collateral Agent, the Company may act as
its own Paying Agent in accordance with Section 1204 of the
Indenture, and the payment of the principal of and interest
(including Additional Interest, if any) on such Subordinated Debt
Securities held by the Property Trustee or the Collateral Agent
will be made by wire transfer at such place and to such account
as may be designated in writing by the Property Trustee or the
Collateral Agent, as the case may be, prior to such payment.
The form of Subordinated Debt Securities attached hereto as
Exhibit A is hereby adopted, pursuant to Section 1101(6) of the
Indenture, as a form of Debt Securities of a series that consists
of the Subordinated Debt Securities.
SECTION 2.4 Global Security.
(a) In connection with a Dissolution Event:
(i) the Subordinated Debt Securities in certificated
form may be presented to the Trustee by the Property Trustee
in exchange for a Global Security in an aggregate principal
amount equal to all Outstanding Subordinated Debt
Securities, to be registered in the name of the Depositary,
or its nominee, and delivered by the Trustee to the
Depositary for crediting to the accounts of its participants
pursuant to the instructions of the Regular Trustees. The
Company upon any such presentation shall execute a Global
Security in such aggregate principal amount and deliver the
same to the Trustee for authentication and delivery in
accordance with the Indenture and this Third Supplemental
Indenture. Payments on the Subordinated Debt Securities
issued as a Global Security will be made to the Depositary;
and
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(ii) with respect to the Common Securities and any
Preferred Securities that are held in non-book-entry
certificated form, the Subordinated Debt Securities in
certificated form may be presented to the Trustee by the
Property Trustee and any Common Security Certificate and any
Preferred Security Certificate which represents Preferred
Securities other than Preferred Securities held by the
Clearing Agency or its nominee ("Non-Book-Entry Preferred
Securities") will be deemed to represent beneficial
interests in Subordinated Debt Securities presented to the
Trustee by the Property Trustee having an aggregate
principal amount equal to the aggregate liquidation amount
of the Common Securities or of the Non-Book-Entry Preferred
Securities, as the case may be, until such Common Security
Certificates or Preferred Security Certificates, as the case
may be, are presented to the Security Registrar for transfer
or reissuance at which time such Common Security
Certificates or Preferred Security Certificates, as the case
may be, will be canceled, and a Subordinated Debt Security
registered in the name of the holder of the Common Security
Certificate or the Preferred Security Certificate, as the
case may be, or the transferee of such holder, with an
aggregate principal amount equal to the aggregate
liquidation amount of the Common Security Certificate or the
Preferred Security Certificate, as the case may be, that was
canceled will be executed by the Company and delivered to
the Trustee for authentication and delivery in accordance
with the Indenture and this Third Supplemental Indenture. On
issue of such Subordinated Debt Securities, Subordinated
Debt Securities with an equivalent aggregate principal
amount that were presented by the Property Trustee to the
Trustee will be deemed to have been canceled.
(b) A Global Security may be transferred, in whole but not
in part, only to another nominee of the Depositary, or to a
successor Depositary selected or approved by the Company or to a
nominee of such successor Depositary.
(c) Nothing in this Section 2.4 shall be deemed to amend
Section 803 of the Indenture.
SECTION 2.5 Interest.
(a) Each Subordinated Debt Security will bear interest at the
rate of 9 1/4% per annum (the "Coupon Rate") from the original
date of issuance until the principal thereof becomes due and
payable, and on any overdue principal and (without duplication
and to the extent that payment of such interest is enforceable
under applicable law) on any overdue installment of interest at
the Coupon Rate, compounded quarterly, payable quarterly in
arrears on March 31, June 30, September 30 and December 31 of
each year (each, a "Payment Date"), commencing on September 30,
1996, to the Person in whose name such Subordinated Debt Security
or any Predecessor Security is registered, at the close of
business on the Regular Record Date for such interest
installment, which shall be the close of business on the
fifteenth day immediately preceding such Payment Date.
(b) The amount of interest payable for any period will be
computed on the basis of a 360-day year of twelve 30-day months.
Except as provided in the following sentence, the amount of
interest payable for any period shorter than a full quarterly
period for which interest
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is computed, will be computed on the basis of the actual number
of days elapsed in such a 30- day month. In the event that any
date on which interest is payable on the Subordinated Debt
Securities is not a Business Day, then payment of interest
payable on such date will be made on the next succeeding day
which is a Business Day (and without any interest or other
payment in respect of any such delay), except that, if such
Business Day is in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day,
in each case with the same force and effect as if made on such
date.
(c) If at any time while the Property Trustee is the Holder
of any Subordinated Debt Securities, the Trust or the Property
Trustee is required to pay any taxes, duties, assessments or
governmental charges of whatever nature (other than withholding
taxes) imposed by the United States, or any other taxing
authority, then, in any case, the Company will pay as additional
interest ("Additional Interest") on the Subordinated Debt
Securities held by the Property Trustee, such additional amounts
as shall be required so that the net amounts received and
retained by the Trust and the Property Trustee after paying such
taxes, duties, assessments or other governmental charges will be
equal to the amounts the Trust and the Property Trustee would
have received had no such taxes, duties, assessments or other
government charges been imposed.
ARTICLE III
REDEMPTION OF THE SUBORDINATED DEBT SECURITIES
SECTION 3.1 Tax Event Redemption.
If a Tax Event has occurred and is continuing and:
(a) the Company has received a Redemption Tax Opinion; or
(b) after receiving a Dissolution Tax Opinion, the Regular
Trustees shall have been informed by tax counsel rendering the
Dissolution Tax Opinion that a No Recognition Opinion cannot be
delivered to the Trust,
then, notwithstanding Section 3.2, but subject to the provisions
of Article Thirteen of the Indenture, the Company shall have the
right upon not less than 30 nor more than 60 days' notice to the
Registered Holders of the Subordinated Debt Securities to redeem
the Subordinated Debt Securities, in whole (but not in part), for
cash within 90 days following the occurrence of such Tax Event
(the "90 Day Period"), provided that, if at the time there is
available to the Company the opportunity to eliminate within the
90 Day Period, the Tax Event by taking some ministerial action
("Ministerial Action"), such as filing a form or making an
election, or pursuing some other similar reasonable measure which
has no adverse effect on the Company, the Trust or the holders of
the Trust Securities issued by the Trust, the Company shall
pursue such Ministerial Action in lieu of redemption; provided,
further, that the Company shall have no right to redeem the
Subordinated Debt Securities while the Trust is pursuing any
Ministerial Action pursuant to its obligations under the
Declaration.
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SECTION 3.2 Optional Redemption by Company.
Subject to the provisions of Article Thirteen of the
Indenture, the Company shall have the right to redeem the
Subordinated Debt Securities, in whole (but not in part), on or
after June 30, 2001, on any Payment Date at a redemption price
equal to 100% of the principal amount to be redeemed plus any
accrued and unpaid interest thereon, including Additional
Interest, if any, to the date of such redemption (the
"Subordinated Debt Redemption Price"). Notwithstanding the
foregoing, after the settlement of the Purchase Contracts on the
Purchase Date (or a related Delayed Purchase Date), such right
shall be postponed or suspended until the fifth anniversary of
such Purchase Date. Any redemption pursuant to this paragraph
will be made upon not less than 30 nor more than 60 days' notice
to the registered Holder of the Subordinated Debt Securities, at
the Subordinated Debt Redemption Price.
SECTION 3.3. No Sinking Fund.
The Subordinated Debt Securities are not entitled to the
benefit of any sinking fund.
ARTICLE IV
REPAYMENT AT OPTION OF HOLDERS
SECTION 4.1 Optional Repayment of Subordinated Debt Securities.
Each Holder of Subordinated Debt Securities, including the
Property Trustee and the Collateral Agent, shall have the right
to require the Company to repay all or a portion (which portion
must be $25 or any integral multiple thereof) of the Subordinated
Debt Securities held by such Holder (the "Subordinated Debt Put
Option"), on the Initial Put Option Exercise Date at a repayment
price equal to 100% of the principal amount thereof plus any
accrued and unpaid interest thereon, including Additional
Interest, if any, to the date of such repayment (the
"Subordinated Debt Repayment Price"). In addition, after the
settlement of the Purchase Contracts on an Early Purchase Date
(or a related Delayed Purchase Date), Holders of Subordinated
Debt Securities that remain outstanding, including the Property
Trustee, shall have a Subordinated Debt Put Option with respect
to the Subordinated Debt Securities held by such Holder on the
Fifth Anniversary Put Option Exercise Date at the Subordinated
Debt Repayment Price (the "Initial Put Option Exercise Date" and
the "Fifth Anniversary Put Option Date" are, collectively, the
"Put Option Exercise Date").
SECTION 4.2 Repayment Procedure for Subordinated Debt Securities.
(a) In order for the Subordinated Debt Securities to be
repaid on the Put Option Exercise Date, the Company must receive
at the Corporate Trust Office in the City of New York, New York,
either (i) not less than 10 nor more than 30 days prior to the
Initial Put Option Exercise Date or (ii) not less than 25 nor
more than 60 days prior to the Fifth Anniversary Put Option
Exercise Date, the Subordinated Debt Securities to be repaid with
the
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form entitled "Option to Elect Repayment" on the reverse of or
otherwise accompanying such Subordinated Debt Securities duly
completed. Any such notice received by the Company shall be
irrevocable. All questions as to the validity, eligibility
(including time of receipt) and acceptance of the Subordinated
Debt Securities for repayment shall be determined by the Company,
whose determination shall be final and binding. Notwithstanding
the foregoing, so long as the Holder is the Property Trustee or
the Collateral Agent, and assuming prior notice to the Trustee,
such Subordinated Debt Securities may be received at the
Corporate Trust Office at any time prior to 11:00 a.m., New York
City time, on the Put Option Exercise Date in the form and manner
as may be designated by the Property Trustee or the Collateral
Agent and acceptable to the Trustee.
(b) The Company will comply with the provisions of Rule 13e-4,
Rule 14e-1 and any other tender offer rules under the Exchange
Act if required and will file Schedule 13E-4 or any other
schedule if required thereunder.
(c) Payment of the Subordinated Debt Repayment Price to
Holders of Subordinated Debt Securities shall be made through the
Trustee, subject to the Trustee's receipt of payment from the
Company in accordance with the terms of the Indenture.
Notwithstanding the foregoing, so long as the Holder of any
Subordinated Debt Securities presented for repayment is the
Property Trustee or the Collateral Agent, the payment of the
Subordinated Debt Repayment Price in respect of such Subordinated
Debt Securities shall be made, either through the Trustee or the
Company acting as Paying Agent, no later than 12:00 noon, New
York City time, on the Put Option Exercise Date, by check or wire
transfer, in immediately available funds, at such place and to
such account as may be designated by the Property Trustee or the
Collateral Agent, as the case may be. If the Trustee holds
immediately available funds sufficient to pay the Subordinated
Debt Repayment Price of the Subordinated Debt Securities
presented for repayment (or, if the Company is acting as Paying
Agent, the Property Trustee has received the Subordinated Debt
Repayment Price), then, immediately prior to the close of
business on the Put Option Exercise Date, such Subordinated Debt
Securities will cease to be outstanding and interest thereon will
cease to accrue, whether or not such Subordinated Debt Securities
have been received by the Company, and all other rights of the
Holder in respect of the Subordinated Debt Securities, including
the Holder's right to require the Company to repay such
Subordinated Debt Securities, shall terminate and lapse (other
than the right to receive the Subordinated Debt Repayment Price
upon delivery of such Subordinated Debt but without interest on
such Subordinated Debt Repayment Price). Neither the Trustee nor
the Company will be required to register or cause to be
registered the transfer of any Subordinated Debt Securities for
which repayment has been elected. Except as described in
paragraph (d), if payment of Subordinated Debt Repayment Price in
respect of Subordinated Debt Securities is improperly withheld or
refused and not paid by the Company, interest on such
Subordinated Debt Securities will continue to accrue, from the
original Put Option Exercise Date to the actual date of payment,
in which case the actual payment date will be considered the Put
Option Exercise Date for purposes of calculating the Subordinated
Debt Repayment Price.
(d) If a Put Default, including a default in the payment of
the Subordinated Debt Repayment Price, shall occur and continue
for more than two Business Days following an
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Initial Put Option Exercise Date, and the Purchase Date is an
Early Purchase Date, then (i) any exercise of the optional right
to elect repayment of the Subordinated Debt Securities shall be
deemed rescinded and annulled automatically and (ii) any
Subordinated Debt Securities delivered to the Company pursuant to
such election shall be returned to the Holders who effected such
delivery.
(c) The rescission or annulment of any notice of exercise as
provided in paragraph (d) will not prevent Holders of
Subordinated Debt Securities from giving a notice of exercise at
a later date.
ARTICLE V
EXPENSES AND GUARANTEE
SECTION 5.1 Payment of Expenses.
In connection with the offering, sale and issuance of the
Subordinated Debt Securities to the Property Trustee in
connection with the sale of the Trust Securities by the Trust,
the Company shall:
(a) pay for all costs and expenses relating to the offering,
sale and issuance of the Subordinated Debt Securities, including
commissions to the underwriters payable pursuant to the
Underwriting Agreement and compensation of the Trustee under the
Indenture in accordance with the provisions of Section 607 of the
Indenture;
(b) pay for all costs and expenses of the Trust including, but
not limited to, costs and expenses relating to the organization
of the Trust, the offering, sale and issuance of the Trust
Securities (including commissions to the underwriters in
connection therewith), the fees and expenses of the Property
Trustee and the Delaware Trustee, the costs and expenses relating
to the operation of the Trust, including without limitation,
costs and expenses of accountants, attorneys, statistical or
bookkeeping services, expenses for printing and engraving and
computing or accounting equipment, paying agent(s), registrar(s),
transfer agent(s), travel expenses and costs and expenses
incurred in connection with the acquisition, financing, and
disposition of Trust assets); and
(c) pay any and all taxes (other than United States
withholding taxes attributable to the Trust or its assets) and
all liabilities, costs and expenses with respect to such taxes of
the Trust.
ARTICLE VI
COVENANTS
SECTION 6.1 Limitation on Dividends and Payments.
If (i) there shall have occurred and be continuing an event
that, with the giving of notice or the lapse of time or both,
would constitute an Event of Default or (ii) the Company shall be
in default with respect to its payment of any obligations under
the Preferred Securities
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Guarantee or Common Securities Guarantee relating to the Trust,
then (a) the Company shall not declare or pay any dividend on,
make any distributions with respect to, or redeem, purchase or
make a liquidation payment with respect to, any of its capital
stock, except for dividends or distributions in shares of its
capital stock of the same class on which such dividend or
distribution is being paid and conversions or exchanges of common
stock of one class into common stock of another class and (b) the
Company shall not make any payment of interest, principal or
premium, if any, on or repay, repurchase or redeem any debt
securities issued by the Company which rank pari passu with or
junior to the Subordinated Debt Securities (except by conversion
into or exchange for shares of its capital stock and except for a
redemption, purchase or other acquisition of shares of its
capital stock made for the purpose of any employee incentive plan
or benefit plan of the Company or any of its subsidiaries).
SECTION 6.2 Covenants as to the Trust.
For so long as such Trust Securities remain outstanding,
the Company will (i) maintain 100% direct or indirect ownership
of the Common Securities of the Trust; provided, however, that
any permitted successor of the Company under the Indenture may
succeed to the Company's ownership of the Common Securities and
(ii) use its reasonable efforts to cause the Trust (a) to remain
a statutory business trust, except in connection with the
distribution of Subordinated Debt Securities to the holders of
Trust Securities in liquidation of the Trust, the redemption of
all of the Trust Securities of the Trust, or certain mergers,
consolidations or amalgamations, each as permitted by the
Declaration of the Trust, and (b) to otherwise continue to be
classified as a grantor trust for United States federal income
tax purposes.
ARTICLE VII
ADDITIONAL RESTRICTION ON
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 7.1 Merger, Consolidation or Sale of Assets.
In addition to the restrictions set forth in Article Ten of
the Indenture, the Company shall not consolidate with or merge
into any other corporation or person, or, directly or indirectly,
convey, transfer or lease all or substantially all of the
properties and assets of the Company on a consolidated basis to
any person, unless the Trust shall not fail to be classified as a
grantor trust for United States federal income tax purposes as a
result of the transaction and the Officers' Certificate and
Opinion of Counsel required by Section 1001 of the Indenture
shall also state that such consolidation, merger, conveyance,
transfer or lease complies with this Section 7.1 and all
applicable conditions precedent set forth herein.
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ARTICLE VIII
ADDITIONAL EVENT OF DEFAULT; PUT DEFAULT
SECTION 8.1 Additional Event of Default.
"Event of Default," wherever used in the Indenture or this
Third Supplemental Indenture with respect to the Subordinated
Debt Securities, in addition to the Events of Default set forth
in Section 501 of the Indenture, shall include the following
event:
(1) the Trust shall have voluntarily or involuntarily
dissolved, wound-up its business or otherwise terminated its
existence, except in connection with (i) the distribution of
Subordinated Debt Securities to holders of Trust Securities in
liquidation of their interests in the Trust, (ii) the redemption
or repayment of all of the outstanding Trust Securities of the
Trust or (iii) certain mergers, consolidations or amalgamations,
each as permitted by the Declaration.
SECTION 8.2 Put Default.
Notwithstanding the provisions set forth in Article Five of
the Indenture, "Event of Default," wherever used in the Indenture
or this Third Supplemental Indenture with respect to the
Subordinated Debt Securities, shall not be deemed to include a
default in the payment of the Subordinated Debt Repayment Price
on the Initial Put Option Exercise Date unless such default shall
continue for more than two Business Days following the Stated
Purchase Date.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Ratification of Indenture.
The Indenture, as supplemented by this Third Supplemental
Indenture, is in all respects ratified and confirmed, and this
Third Supplemental Indenture shall be deemed part of the
Indenture in the manner and to the extent herein and therein
provided.
SECTION 9.2 Trustee Not Responsible for Recitals.
The recitals herein contained are made by the Company and
not by the Trustee, and the Trustee assumes no responsibility for
the correctness thereof. The Trustee makes no representation as
to the validity or sufficiency of this Third Supplemental
Indenture.
SECTION 9.3 Governing Law.
This Third Supplemental Indenture and each Subordinated
Debt Security shall be deemed to be a contract made and to be
performed entirely in the State of New York, and for
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all purposes shall be governed and construed in accordance with
the laws of said State without regard to the conflicts of laws
rules of said State.
SECTION 9.4 Separability.
In case any one or more of the provisions contained in this
Third Supplemental Indenture or in the Subordinated Debt
Securities shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provisions of this
Third Supplemental Indenture or of the Subordinated Debt
Securities, but the First Supplemental Indenture and the
Subordinated Debt Securities shall be construed as if such
invalid or illegal or unenforceable provision had never been
contained herein or therein.
SECTION 9.5 Counterparts.
This Third Supplemental Indenture may be executed in any
number of counterparts each of which shall be an original; but
such counterparts shall together constitute but one and the same
instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this
Third Supplemental Indenture to be duly executed, and their
respective corporate seals to be hereunto affixed and attested,
on the date or dates indicated in the acknowledgments and as of
the day and year first above written.
SALOMON INC
By /s/ Xxxxxxx X. Xxxxxxxx
Name: Xxxxxxx X. Xxxxxxxx
Title: Senior Vice President
Attest:
/s/ Xxxxxx X. Xxxxxx
Secretary
BANKERS TRUST COMPANY,
as Trustee
By /s/ Xxxxxx Xxxxxxxx
Name: Xxxxxx Xxxxxxxx
Title: Assistant Vice President
Attest:
/s/ Xxxxxxx Xxxxxxx
STATE OF NEW YORK )
COUNTY OF NEW YORK ) ss.:
On the 2nd day of July, 1996, before me personally came
Xxxxxx Xxxxxxxx to me known, who, being by me duly sworn, did
depose and say that he is the Assistant Vice President of Bankers
Trust Company, one of the corporations described in and which
executed the above instrument; that he knows the corporate seal
of said corporation; that the seal affixed to the said instrument
is such corporation seal; that it was so affixed by authority of
the Board of Directors of said corporation, and that he signed
his name thereto by like authority.
/s/ Xxxxxxxx Xxxxxx
------------------------
NOTARY PUBLIC
[seal] Commission expires 2/28/98
STATE OF NEW YORK )
COUNTY OF NEW YORK ) ss.:
On the 2nd day of July, 1996, before me personally came
Xxxxxxx X. Xxxxxxxx to me known, who, being by me duly sworn, did
depose and say that he is the Senior Vice President of Salomon
Inc, one of the corporations described in and which executed the
above instrument; that he knows the corporate seal of said
corporation; that the seal affixed to the said instrument is such
corporation seal; that it was so affixed by authority of the
Board of Directors of said corporation, and that he signed his
name thereto by like authority.
/s/ Xxxxx X. Xxxxxxx
------------------------
NOTARY PUBLIC
[seal] Commission expires 7/11/96
EXHIBIT A
SPECIMEN OF SUBORDINATED DEBT SECURITY
(FORM OF FACE OF SUBORDINATED DEBT SECURITY)
[IF THE SUBORDINATED DEBT SECURITY IS TO BE A GLOBAL
SECURITY, INSERT - This Subordinated Debt Security is a Global
Security within the meaning of the Indenture hereinafter referred
to and is registered in the name of the Depositary or the nominee
of the Depositary. This Subordinated Debt Security is
exchangeable for Subordinated Debt Securities registered in the
name of a Person other than the Depositary or its nominee only in
the limited circumstances described in the Indenture, and no
transfer of this Subordinated Debt Security (other than a
transfer of this Subordinated Debt Security as a whole by the
Depositary to a nominee of the Depositary or by a nominee of the
Depositary to the Depositary or another nominee of the
Depositary) may be registered except in limited circumstances.
Unless this Subordinated Debt Security is presented by an
authorized representative of The Depository Trust Company (55
Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx) to the issuer or its agent for
registration of transfer, exchange or payment, and any
Subordinated Debt Security issued is registered in the name of
Cede & Co. or such other name as requested by an authorized
representative of The Depository Trust Company and any payment
hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL since the
registered owner hereof, Cede & Co., has an interest herein.]
-------------------------
No. $
CUSIP No. 00000XX0
SALOMON INC
9 1/4% SUBORDINATED DEBT SECURITY DUE JUNE 30, 2026
Salomon Inc, a Delaware corporation (the "Company," which
term includes any successor corporation under the Indenture
hereinafter referred to), for value received, hereby promises to
pay to or registered assigns, the principal sum of Dollars on
June 30, 2026, and to pay interest on said principal sum from
September 30, 1996 or from the most recent interest payment date
(each such date, a "Payment Date") to which interest has been
paid or duly provided for, quarterly in arrears on March 31, June
30, September 30 and December 31 of each year commencing
September 30, 1996 at the rate of 9 1/4% per annum until the
principal hereof shall have become due and payable, and on any
overdue principal and (without duplication and to the extent that
payment of such interest is enforceable under applicable law) on
any overdue installment of interest at the same rate per annum,
compounded
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quarterly. The amount of interest payable for any period shall be
computed on the basis of a 360-day year of twelve 30-day months.
Except as provided in the following sentence, the amount of
interest payable for any period shorter than a full quarterly
period for which interest is computed, will be computed on the
basis of the actual number of days elapsed in such a 30- day
month. In the event that any date on which interest is payable on
this Subordinated Debt Security is not a Business Day, then
payment of interest payable on such date will be made on the next
succeeding day which is a Business Day (and without any interest
or other payment in respect of any such delay), except that, if
such Business Day is in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day,
in each case with the same force and effect as if made on such
date. The interest installment so payable, and punctually paid or
duly provided for, on any Payment Date will, as provided in the
Indenture, be paid to the Person in whose name this Subordinated
Debt Security (or one or more Predecessor Securities, as defined
in said Indenture) is registered at the close of business on the
Regular Record Date for such interest installment which shall be
the close of business on the fifteenth day immediately preceding
such Payment Date. Any such interest installment not punctually
paid or duly provided for shall forthwith cease to be payable to
the Registered Holders on such Regular Record Date, and may be
paid to the Person in whose name this Subordinated Debt Security
(or one or more Predecessor Securities) is registered at the
close of business on a Special Record Date to be fixed by the
Trustee for the payment of such Defaulted Interest, notice
whereof shall be given to the Registered Holders of the
Subordinated Debt Securities not less than ten days prior to such
Special Record Date, or may be paid at any time in any other
lawful manner, all as more fully provided in the Indenture. The
principal of and the interest (including Additional Interest, if
any) on this Subordinated Debt Security shall be payable at the
Corporate Trust Office in any coin or currency of the United
States of America which at the time of payment is legal tender
for payment of public and private debts; provided, however, that
payment of interest may be made at the option of the Company by
check mailed to the Registered Holder at such address as shall
appear in the Security Register. Notwithstanding the foregoing,
so long as the Holder of this Subordinated Debt Security is the
Property Trustee or the Collateral Agent, the Company may act as
its own Paying Agent, and the payment of the principal of and
interest (including Additional Interest, if any) on this
Subordinated Debt Security will be made by wire transfer at such
place and to such account as may be designated in writing by the
Property Trustee or the Collateral Agent, as the case may be,
prior to such payment.
The indebtedness evidenced by this Subordinated Debt
Security is, to the extent provided in the Indenture, subordinate
and junior in right of payment to the prior payment in full of
all Senior Indebtedness, and this Subordinated Debt Security is
issued subject to the provisions of the Indenture with respect
thereto. Each Holder of this Subordinated Debt Security, by
accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his or her
behalf to take such action as may be necessary or appropriate to
acknowledge or effectuate the subordination so provided and (c)
appoints the Trustee his or her attorney-in-fact for any and all
such purposes. Each Holder hereof, by his or her acceptance
hereof, hereby waives all notice of the acceptance of the
subordination provisions contained herein and in the Indenture by
each holder of Senior Indebtedness,
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whether now outstanding or hereafter incurred, and waives
reliance by each such Holder upon said provisions.
This Subordinated Debt Security shall not be entitled to
any benefit under the Indenture hereinafter referred to, be valid
or become obligatory for any purpose until the Certificate of
Authentication hereon shall have been signed by or on behalf of
the Trustee.
The provisions of this Subordinated Debt Security are
continued on the reverse side hereof and such continued
provisions shall for all purposes have the same effect as though
fully set forth at this place.
IN WITNESS WHEREOF, the Company has caused this instrument
to be executed.
Dated_____________________
SALOMON INC
By______________________
Attest:
By______________________
Secretary
(FORM OF CERTIFICATE OF AUTHENTICATION)
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Debt Securities issued under the
within-mentioned Indenture.
BANKERS TRUST COMPANY,
as Trustee
[By _____________________
Authenticating Agent]
By______________________
Authorized Officer
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(FORM OF REVERSE OF SUBORDINATED DEBT SECURITY)
This Subordinated Debt Security is one of a duly authorized
series of subordinated debentures, notes, bonds or other
evidences of indebtedness of the Company (hereinafter referred to
as the "Debt Securities"), hereinafter specified, all issued or
to be issued in one or more series under and pursuant to an
Indenture dated as of December 1, 1988 duly executed and
delivered between the Company and Bankers Trust Company, a New
York banking corporation, as Trustee (hereinafter referred to as
the "Trustee"), as supplemented from time to time and as
supplemented by the Third Supplemental Indenture dated as of July
3, 1996 between the Company and the Trustee (as so supplemented
and as may be further supplemented from time to time, the
"Indenture"), to which Indenture and all indentures supplemental
thereto reference is hereby made for a description of the rights,
limitations of rights, obligations, duties and immunities
thereunder of the Trustee, the Company and the Holders of the
Debt Securities. By the terms of the Indenture, the Debt
Securities are issuable in series which may vary as to amount,
date of maturity, rate of interest and in other respects as in
the Indenture provided. This series of Debt Securities is
designated the 9 1/4% Subordinated Debt Securities due June 30,
2026 in an aggregate principal amount as specified in said Third
Supplemental Indenture.
The Subordinated Debt Securities are not entitled to the
benefit of any sinking fund.
Because of the occurrence and continuation of a Tax Event,
in certain circumstances this Subordinated Debt Security will
become due and payable at a redemption price equal to 100% of the
principal amount plus any accrued but unpaid interest, including
Additional Interest, if any, to the date of such redemption (the
"Subordinated Debt Redemption Price"). Except as provided in the
preceding sentence, the Subordinated Debt Securities may not be
redeemed by the Company prior to June 30, 2001. The Company shall
have the right to redeem this Subordinated Debt Security at the
option of the Company, without premium or penalty, in whole (but
not in part), on any Payment Date on or after June 30, 2001 (an
"Optional Redemption"), at the Subordinated Debt Redemption
Price; provided, however, that after the Purchase Date (or a
related Delayed Purchase Date), such right will be postponed or
suspended until the fifth anniversary of such date. Any
redemption pursuant to this paragraph will be made upon not less
than 30 nor more than 60 days' notice.
The Holder of this Subordinated Debt Security, including
the Property Trustee and the Collateral Agent, shall have the
right to require the Company to repay all or a portion (which
portion must be $25 or any integral multiple thereof) of this
Subordinated Debt Security (the "Subordinated Debt Put Option")
on the Initial Put Option Exercise Date at a repayment price
equal to 100% of the principal amount thereof plus any accrued
but unpaid interest, including Additional Interest, if any, to
the date of such repayment (the "Subordinated Debt Repayment
Price"). In addition, after the settlement of the Purchase
Contracts on an Early Purchase Date (or a related Delayed
Purchase Date), the Holder of this Subordinated Debt Security,
including the Property Trustee, shall have a Subordinated Debt
Put Option on the Fifth Anniversary Put
A-4
Option Exercise Date at the Subordinated Debt Repayment Price. In
order for the Subordinated Debt Securities to be repaid on the
Put Option Exercise Date, the Company must receive at the
Corporate Trust Office, either (i) not less than 10 nor more than
30 days prior to the Initial Put Option Exercise Date or (ii) not
less than 25 nor more than 60 days prior to the Fifth Anniversary
Put Option Exercise Date, the Subordinated Debt Securities to be
repaid with the form entitled "Option to Elect Repayment" hereon
duly completed. Any such notice received by the Company shall be
irrevocable. All questions as to the validity, eligibility
(including time of receipt) and acceptance of the Subordinated
Debt Securities for repayment shall be determined by the Company,
whose determination shall be final and binding. Notwithstanding
the foregoing, so long as the Holder is the Property Trustee or
the Collateral Agent, and assuming prior notice to the Trustee,
this Subordinated Debt Security may be received at the Corporate
Trust Office at any time prior to 11:00 a.m., New York City time,
on the Put Option Exercise Date in the form and manner as may be
designated by the Property Trustee or the Collateral Agent and
acceptable to the Trustee.
In the event of repayment of this Subordinated Debt
Security in part only, a new Subordinated Debt Security or
Subordinated Debt Securities of this series for the unredeemed
portion hereof will be issued in the name of the Holder hereof
upon the cancellation hereof.
In case an Event of Default, as defined in the Indenture,
shall have occurred and be continuing, the principal of all of
the Subordinated Debt Securities may be declared, and upon such
declaration shall become, due and payable, in the manner, with
the effect and subject to the conditions provided in the
Indenture.
The Indenture contains provisions permitting the Company
and the Trustee, with the consent of the Holders of not less than
a majority in aggregate principal amount of the Subordinated Debt
Securities at the time Outstanding, as defined in the Indenture,
to execute supplemental indentures for the purpose of adding any
provisions to or changing in any manner or eliminating any of the
provisions of the Indenture or of any supplemental indenture or
of modifying in any manner the rights of the Holders of the
Subordinated Debt Securities; provided, however, that no such
supplemental indenture shall, without the consent of the Holders
of each Subordinated Debt Security then outstanding and so
affected: (i) extend the Stated Maturity of any Subordinated Debt
Securities, or reduce the principal amount thereof, or reduce the
rate or extend the time of payment of interest thereon, (ii)
change the currency of payment in which the principal of or
interest on any Subordinated Debt Security is denominated or
payable, (iii) impair the right to institute suit for the
enforcement of any payment on or with respect to any Subordinated
Debt Security or (iv) reduce the aforesaid percentage of
Subordinated Debt Securities, the Holders of which are required
to consent to any such supplemental indenture. The Indenture also
contains provisions permitting the Holders of a majority in
aggregate principal amount of the Subordinated Debt Securities at
the time outstanding affected thereby, on behalf of all of the
Holders of the Subordinated Debt Securities, to waive any past
default in the performance of any of the covenants contained in
the Indenture, or established pursuant to the Indenture with
respect to the Subordinated Debt Securities, and its
consequences, except a default in the payment of the principal of
or interest on any of the Subordinated Debt Securities. Any such
consent or waiver by the Registered
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Holder of this Subordinated Debt Security (unless revoked as
provided in the Indenture) shall be conclusive and binding upon
such Holder and upon all future Holders and owners of this
Subordinated Debt Security and of any Subordinated Debt Security
issued in exchange herefor or in place hereof (whether by
registration of transfer or otherwise), irrespective of whether
or not any notation of such consent or waiver is made upon this
Subordinated Debt Security.
No reference herein to the Indenture and no provision of
this Subordinated Debt Security or of the Indenture shall alter
or impair the obligation of the Company, which is absolute and
unconditional, to pay the principal of and interest on this
Subordinated Debt Security at the time and place and at the rate
and in the money herein prescribed.
As provided in the Indenture and subject to certain
limitations therein set forth, this Subordinated Debt Security is
transferable by the Registered Holder hereof on the Security
Register of the Company, upon surrender of this Subordinated Debt
Security for registration of transfer at the Corporate Trust
Office or at any other office or agency of the Company maintained
for that purpose, accompanied by a written instrument or
instruments of transfer in form satisfactory to the Company or
the Trustee duly executed by the Registered Holder hereof or his
attorney duly authorized in writing, and thereupon one or more
new Subordinated Debt Securities of authorized denominations and
for the same aggregate principal amount will be issued to the
designated transferee or transferees. No service charge will be
made for any such transfer, but the Company may require payment
of a sum sufficient to cover any tax or other governmental charge
payable in relation thereto.
Prior to due presentment for registration of transfer of
this Subordinated Debt Security, the Company, the Trustee, any
Paying Agent and any Security Registrar may deem and treat the
Registered Holder hereof as the absolute owner hereof (whether or
not this Subordinated Debt Security shall be overdue and
notwithstanding any notice of ownership or writing hereon made by
anyone other than the Security Registrar) for the purpose of
receiving payment of or on account of the principal hereof and
interest due hereon and for all other purposes, and neither the
Company nor the Trustee nor any Paying Agent nor any Security
Registrar shall be affected by any notice to the contrary.
No recourse shall be had for the payment of the principal
of or the interest on this Subordinated Debt Security, or for any
claim based hereon, or otherwise in respect hereof, or based on
or in respect of the Indenture, against any incorporator,
stockholder, officer or director, past, present or future, as
such, of the Company or of any predecessor or successor
corporation, whether by virtue of any constitution, statute or
rule of law, or by the enforcement of any assessment or penalty
or otherwise, all such liability being, by the acceptance hereof
and as part of the consideration for the issuance hereof,
expressly waived and released.
[IF THE SUBORDINATED DEBT SECURITY IS TO BE A CERTIFICATED
SECURITY, INSERT- The Subordinated Debt Securities are issuable
only in registered form without coupons in minimum denominations
of $25 and any integral multiple thereof.] [IF THE SUBORDINATED
DEBT SECURITY IS TO BE A GLOBAL SECURITY, INSERT-
A-6
This Global Security is exchangeable for Subordinated Debt
Securities in definitive form only under certain limited
circumstances set forth in the Indenture. Subordinated Debt
Securities so issued are issuable only in registered form without
coupons in minimum denominations of $25 and any integral multiple
thereof.] As provided in the Indenture and subject to certain
limitations herein and therein set forth, Subordinated Debt
Securities so issued are exchangeable for a like aggregate
principal amount of Subordinated Debt Securities of a different
authorized denomination, as requested by the Holder surrendering
the same.
All terms used in this Subordinated Debt Security which are
defined in the Indenture shall have the meanings assigned to them
in the Indenture.
THIS SUBORDINATED DEBT SECURITY SHALL FOR ALL PURPOSES BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICTS OF LAWS
PRINCIPLES THEREOF.
ABBREVIATIONS
The following abbreviations, when used in the inscription
on the face of this instrument, shall be construed as though they
were written out in full according to applicable laws or
regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT- ______Custodian_____
TEN ENT - as tenants by the entireties (Cust) (Minor)
JT TEN - as joint tenants with Under Uniform Gifts
right of survivorship to Minors Act
and not as tenants in ____________________
common (State)
Additional abbreviations may also be used though
not in the above list.
-------------------------
A-7
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably requests and instructs
the Company to repay $ principal amount of the within
Subordinated Debt Security, pursuant to its terms, on the "Put
Option Exercise Date" first occurring after the date of receipt
of the within Subordinated Debt Security as specified below,
together with interest thereon accrued to the date or repayment,
to the undersigned at:
(Please print or type Name and Address of the Undersigned)
and to issue to the undersigned, pursuant to the terms of the
Indenture, a new Subordinated Debt Security or Subordinated Debt
Securities representing the remaining principal amount of this
Subordinated Debt Security.
For this Option to Elect Repayment to be effective, this
Subordinated Debt Security with the Option to Elect Repayment
duly completed must be received by the Company within the
relevant time period set forth above at its Corporate Trust
Office at 0 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Corporate Trust and Agency Group.
Dated: Signature: ________________________
Note: The signature to this Option to Elect Repayment must
correspond with the name as written upon the face of the within
Subordinated Debt Security in every particular without alteration
or enlargement or any change whatsoever.
-------------------------
A-8
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
Please insert Social Security or Taxpayer I.D. or other
Identifying Number of Assignee
------------------------------------
----------------------------------------------------------------------
Please Print or Type Name and Address Including Postal Zip Code
of Assignee
----------------------------------------------------------------------
the within certificates representing Subordinated Debt Securities
and all rights thereunder, hereby irrevocably constituting and
appointing
attorney
--------------------------------------------------------------
to transfer said certificates representing Subordinated Debt
Securities on the books of Salomon Inc with full power of
substitution in the premises.
Dated:
------------------
------------------------------
Signature
NOTICE: The signature to this
assignment must correspond
with the name as it appears
upon the face of the within
certificates representing
Subordinated Debt Securities
in every particular, without
alteration or enlargement or
any change whatsoever.
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