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RJR NABISCO HOLDINGS CORP.
AND
THE BANK OF NEW YORK
as Trustee
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[ ] SUPPLEMENTAL INDENTURE
Dated as of __________, 199__
TO
INDENTURE
Dated as of __________, 199__
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o% Junior Subordinated Debentures
Due 20___
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[ ] SUPPLEMENTAL INDENTURE, dated as of the ___ day of
___________, 199__ (the "[ ] Supplemental Indenture"), between RJR NABISCO
HOLDINGS CORP., a corporation duly organized and existing under the laws of
the State of Delaware (hereinafter sometimes referred to as "Holdings"),
and The Bank of New York, a New York banking corporation, as trustee
(hereinafter sometimes referred to as the "Trustee") under the Indenture
dated as of September 21, 1995 between Holdings and the Trustee, as
supplemented by the First Supplemental Indenture dated as of September 21,
1995 between Holdings and the Trustee (said Indenture as so supplemented
being hereinafter referred to as the "Indenture"). All terms used and not
defined herein are used as defined in the Indenture.
WHEREAS, Holdings has executed and delivered the Indenture to
the Trustee to provide for the future issuance of its notes, debentures and
other evidences of indebtedness (the "Securities"), said Securities to be
issued from time to time in series as might be determined by Holdings under
the Indenture, in an unlimited aggregate principal amount which may be
authenticated and delivered thereunder as in the Indenture provided; and
WHEREAS, pursuant to the terms of the Indenture, Holdings
desires to provide for the establishment of a series of its junior
subordinated debentures ("Debentures") to be known as its __% Junior
Subordinated Debentures Due 20___ (said series being hereinafter referred
to as the "Junior Subordinated Debentures"), the form and substance of such
Junior Subordinated Debentures and the terms, provisions and conditions
thereof to be as provided in the Indenture and this o Supplemental
Indenture; and
WHEREAS, Holdings has caused to be formed RJR Nabisco Holdings
Capital Trust ___ (the "Trust") as a statutory business trust under the
Business Trust Act of the State of Delaware (12 Del. Code Section 3801 et
seq.) pursuant to a declaration of trust dated August 5, 1998 (the
"Original Declaration") and the filing of a certificate of trust with the
Secretary of State of the State of Delaware on August 6, 1998; and
WHEREAS, the Original Declaration has been amended and restated
in its entirety pursuant to an Amended and Restated Declaration of Trust dated
as of ____________, 199__ (such Amended and Restated Declaration of Trust,
as amended from time to time, the "Declaration of Trust") with The Bank of
New York, as Institutional Trustee; and
WHEREAS, the Trust desires to issue its __% Trust Originated
Preferred Securities (the "Preferred Securities") and sell such Preferred
Securities to initial purchasers; and
WHEREAS, pursuant to the Preferred Securities Guarantee (the
"Preferred Securities Guarantees"), Holdings has irrevocably and
unconditionally guaranteed, to the extent set forth therein, to pay in full,
to the holders of the Preferred Securities, the Guarantee Payments (as defined
therein), to the extent not paid by the Trust; and
WHEREAS, in connection with such purchases of Preferred
Securities and the related purchase by the Company of Common Securities (as
defined in the Declaration of Trust) of the Trust, the Trust will purchase
as trust assets Junior Subordinated Debentures; and
WHEREAS, pursuant to the Declaration of Trust, the legal title
to the Junior Subordinated Debentures shall be owned and held of record in the
name of The Bank of New York or its successor under the Declaration of Trust,
as Institutional Trustee (the "Institutional Trustee"); and
WHEREAS, upon the occurrence of a Special Event (as defined in
the Declaration of Trust) the Regular Trustees (as defined in the Declaration
of Trust) of the Trust shall, unless the Junior Subordinated Debentures are
redeemed as described herein, dissolve the Trust and cause to be distributed to
the holders of the Preferred Securities and Common Securities, on a Pro Rata
basis (determined as provided in the terms of the Preferred Securities and
Common Securities attached as Exhibits B and C to the Declaration of Trust),
Junior Subordinated Debentures and in connection with a Liquidation
Distribution (as defined in the Declaration of Trust) the Regular Trustees may
cause to be distributed to holders of Preferred Securities and Common
Securities, on such a Pro Rata basis, Junior Subordinated Debentures (each a
"Dissolution Event"); and
WHEREAS, Holdings desires and has requested the Trustee to join
with it in the execution and delivery of this [ ] Supplemental Indenture, and
all requirements necessary to make this [ ] Supplemental Indenture a valid
instrument, in accordance with its terms, and to make the Junior
Subordinated Debentures, when executed by Holdings and authenticated and
delivered by the Trustee, the valid obligations of Holdings, have been
performed and fulfilled, and the execution and delivery hereof have been in
all respects duly authorized;
NOW THEREFORE, in consideration of the purchase and acceptance
of the Junior Subordinated Debentures by the holders thereof, and for the
purpose of setting forth, as provided in the Indenture, the form and substance
of the Junior Subordinated Debentures and the terms, provisions and conditions
thereof, Holdings covenants and agrees with the Trustee as follows:
ARTICLE 1
General Terms and Conditions of the Junior Subordinated Debentures
Section 1.1. There shall be and is hereby authorized a
series of Debentures designated the "___% Junior Subordinated Debentures Due
20___", limited in aggregate principal amount of $___ which is equal to the
sum of (i) $___ plus (ii) $___ which is a dollar amount equal to the principal
amount of Junior Subordinated Debentures purchased by the Trust with the
proceeds received by the Trust from the purchase by Holdings of the Common
Securities of the Trust, which amount shall be as set forth in any written
order of Holdings for the authentication and delivery of Junior
Subordinated Debentures. Upon exercise of the overallotment option set
forth in the Underwriting Agreement (as defined in the Declaration of
Trust), additional Junior Subordinated Debentures in the aggregate
principal amount of up to $o may be executed by Holdings and delivered to
the Trustee for authentication, and the Trustee shall thereupon
authenticate and deliver said Junior Subordinated Debentures to or upon the
written order of Holdings, which order shall be accompanied by evidence
satisfactory to the Trustee that the overallotment option has been
exercised. The Junior Subordinated Debentures shall mature and the
principal shall be due and payable together with all accrued and unpaid
interest thereon, including Compounded Interest (as hereinafter defined) on
__________, 20___.
Section 1.2. (a) The Junior Subordinated Debentures shall
be issued in fully registered certificated form without interest coupons.
Principal and interest on the Junior Subordinated Debentures issued in
certificated form will be payable, the transfer of such Junior Subordinated
Debentures will be registrable and such Junior Subordinated Debentures will
be exchangeable for Junior Subordinated Debentures bearing identical terms
and provisions at the office or agency of Holdings in the Borough of
Manhattan, The City and State of New York; provided, however, that payment
of interest may be made at the option of Holdings by check mailed to the
registered holder at such address as shall appear in the Debenture register
and that the payment of principal with respect to the Junior Subordinated
Debentures will only be made upon surrender of the Junior Subordinated
Debentures to the Trustee.
(b) In connection with a Dissolution Event;
(i) Junior Subordinated Debentures in certificated form may
be presented to the Trustee by the Institutional Trustee in
exchange for a Global Debenture representing the Junior
Subordinated Debentures in an aggregate principal amount equal to
all outstanding Junior Subordinated Debentures, 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 (as defined in the Declaration of Trust). Upon any such
presentation, Holdings shall execute a Global Debenture
representing the Junior Subordinated Debentures in such aggregate
principal amount and deliver the same to the Trustee for
authentication and delivery in accordance with the Indenture and
this o Supplemental Indenture. Payments on the Junior
Subordinated Debentures issued as a Global Debenture will be made
to the Depositary; and
(ii) if any Preferred Securities are held in non book-entry
certificated form, Junior Subordinated Debentures in certificated
form may be presented to the Trustee by the Institutional Trustee
and any Preferred Security Certificate (as defined in the
Declaration of Trust) which represents Preferred Securities other
than Preferred Securities held by the Clearing Agency (as defined
in the Declaration of Trust) or its nominee ("Non Book-Entry
Preferred Securities") will be deemed to represent beneficial
interests in Junior Subordinated Debentures presented to the
Trustee by the Institutional Trustee having an aggregate
principal amount equal to the aggregate liquidation amount of the
Non Book-Entry Preferred Securities until such Preferred Security
Certificate is presented to the Debenture Registrar for transfer
or reissuance at which time such Preferred Security Certificate
will be cancelled and a Junior Subordinated Debenture, registered
in the name of the holder of the Preferred Security Certificate
or the transferee of the holder of such Preferred Security
Certificate, as the case may be, with an aggregate principal
amount equal to the aggregate liquidation amount of the Preferred
Security Certificate canceled will be executed by Holdings and
delivered to the Trustee for authentication and delivery in
accordance with the Indenture and this o Supplemental Indenture.
On issue of such Junior Subordinated Debentures, Junior
Subordinated Debentures with an equivalent aggregate amount that
were presented by the Institutional Trustee to the Trustee will
be deemed to have been canceled.
Section 1.3. Each Junior Subordinated Debenture will bear
interest at the rate of ___% per annum from and including __________,
199___ until the principal thereof becomes due and payable, and on any
overdue principal 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 quarterly, payable (subject to the
provisions of Article Three) quarterly in arrears on __________,
__________, __________ and __________ of each year (each, an "Interest
Payment Date", commencing on __________, 199___), to the person in whose
name such Junior Subordinated Debenture or any predecessor Junior
Subordinated Debenture is registered, at the close of business on the
regular record date for such interest installment, which, except as set
forth below, shall be the close of business on the business day immediately
preceding that Interest Payment Date. Notwithstanding the foregoing
sentence, if the Preferred Securities are no longer in book-entry only form
or if pursuant to the provisions of Section 2.4(4) of the Indenture, the
Junior Subordinated Debentures are not represented by a Global Debenture,
the regular record dates for such interest installment shall be the close
of business on the last day of the quarter next preceding that Interest
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
the Junior Subordinated Debenture (or one or more Predecessor Debentures)
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 Junior Subordinated
Debentures not less than 10 days prior to such special record date, or may
be paid at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Junior Subordinated
Debentures may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in the Indenture.
The amount of interest payable for any period will be computed
on the basis of a 360-day year of twelve 30-day months and for any period
shorter than a full quarterly interest period for which interest is computed,
the amount of interest payable 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 Junior Subordinated Debentures 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 (and the regular record date for such
interest installment shall be the business day immediately preceding the
business day which is 15 days preceding such Interest Payment Date), in
each case with the same force and effect as if made on such date.
ARTICLE 2
Optional Redemption of the Junior Subordinated Debentures
Section 2.1. Except as provided in Section 2.02, Junior
Subordinated Debentures may not be redeemed by Holdings prior to
__________, 20___. Subject to the terms of Article Three of the Indenture,
Holdings shall have the right to redeem the Junior Subordinated Debentures,
in whole or in part, from time to time, on or after __________, 20___, at a
redemption price equal to 100% of the principal amount to be redeemed plus
any accrued and unpaid interest thereon, including Compounded Interest, if
any, to the date of such redemption (the "Optional Redemption Price"). Any
redemption pursuant to this paragraph will be made upon not less than 30
nor more than 60 days' notice, at the Optional Redemption Price.
Section 2.2. If, at any time, a Tax Event (as defined
below) shall occur or be continuing and (i) the Regular Trustees and
Holdings shall have received an opinion (a "Redemption Tax Opinion") of a
nationally recognized independent tax counsel experienced in such matters
that, as a result of a Tax Event, there is more than an insubstantial risk
that Holdings would be precluded from deducting the interest on the Junior
Subordinated Debentures for United States federal income tax purposes even
if the Junior Subordinated Debentures were distributed to the holders of
Preferred Securities and Common Securities in liquidation of such holder's
interest in the Trust as set forth in the Declaration of Trust or (ii) the
Regular Trustees shall have been informed by such tax counsel that a No
Recognition Opinion (as defined below) cannot be delivered to the Trust,
Holdings shall have the right at any time, upon not less than 30 nor more
than 60 days' notice, to redeem the Junior Subordinated Debentures in whole
or in part for cash at the Optional Redemption Price within 90 days
following the occurrence of such Tax Event; provided, however, that, if at
the time there is available to Holdings or the Regular Trustees on behalf
of the Trust the opportunity to eliminate, within such 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 Trust, Holdings or
the holders of the Preferred Securities, Holdings or the Regular Trustees
on behalf of the Trust will pursue such measure in lieu of redemption and
provided further that Holdings shall have no right to redeem the Junior
Subordinated Debentures while the Regular Trustees on behalf of the Trust
are pursuing any such Ministerial Action.
"Tax Event" means that Holdings and the Regular Trustees shall
have obtained an opinion of nationally recognized independent tax counsel
experienced in such matters (a "Dissolution Tax Opinion") to the effect
that on or after __________, 199___, as a result of (a) any amendment to,
or change (including any announced prospective change) in, the laws (or any
regulations thereunder) of the United States or any political subdivision
or taxing authority thereof or therein (b) any amendment to, or change in,
an interpretation or application of any such laws or regulations by any
legislative body, court, governmental agency or regulatory authority
(including the enactment of any legislation and the publication of any
judicial decision or regulatory determination), (c) any interpretation or
pronouncement that provides for a position with respect to such laws or
regulations that differs from the theretofore generally accepted position
or (d) any action taken by any governmental agency or regulatory authority,
which amendment or change is enacted, promulgated, issued or announced or
which interpretation or pronouncement is issued or announced or which
action is taken, in each case on or after __________, 199___, there is more
than an insubstantial risk that (i) the Trust is, or will be within 90 days
of the date thereof, subject to United States federal income tax with
respect to income accrued or received on the Junior Subordinated
Debentures, (ii) the Trust is, or will be within 90 days of the date
thereof, subject to more than a de minimis amount of taxes, duties or other
governmental charges or (iii) interest payable by Holdings to the Trust on
the Junior Subordinated Debentures is not, or within 90 days of the date
thereof will not be, deductible by Holdings for United States federal
income tax purposes.
"No Recognition Opinion" means an opinion of a nationally
recognized independent tax counsel experienced in such matters, which opinion
may rely on any then applicable published revenue ruling of the Internal
Revenue Service, to the effect that the holders of the Preferred Securities
will not recognize any gain or loss for United States federal income tax
purposes as a result of a dissolution of the Trust and distribution of the
Junior Subordinated Debentures as provided in the Declaration of Trust.
Section 2.3. If the Junior Subordinated Debentures are only
partially redeemed pursuant to this Article Two, the Junior Subordinated
Debentures will be redeemed pro rata or by lot or by any other method
utilized by the Trustee. Notwithstanding the foregoing, if a partial
redemption of the Junior Subordinated Debentures would result in the
delisting of the Preferred Securities by any national securities exchange
or other organization on which the Preferred Securities are then listed,
Holdings shall not be permitted to effect such partial redemption and will
only redeem the Junior Subordinated Debentures in whole.
ARTICLE 3
Extension of Interest Payment Period
Section 3.1. So long as Holdings is not in default in the
payment of interest on the Junior Subordinated Debentures, Holdings shall
have the right, at any time during the term of the Junior Subordinated
Debentures, from time to time to extend the interest payment period of such
Junior Subordinated Debentures for up to 20 consecutive quarterly interest
periods (the "Extended Interest Payment Period"), at the end of which
period Holdings shall pay all interest accrued and unpaid thereon (together
with interest thereon at the rate of ___% per annum, compounded quarterly to
the extent permitted by applicable law ("Compounded Interest")). During
such Extended Interest Payment Period Holdings shall not declare or pay any
dividend on, or redeem, purchase, acquire or make a distribution or
liquidation payment with respect to, any of its common stock or preferred
stock, or make any guarantee payments with respect thereto; provided that
Holdings may pay accrued dividends (and cash in lieu of fractional shares)
upon mandatory conversion of any of its preferred stock, including its ESOP
Preferred Stock, in accordance with the terms of such stock. Prior to the
termination of any such Extended Interest Payment Period, Holdings may pay
all or any portion of the interest accrued on the Junior Subordinated
Debentures on any Interest Payment Date to holders of record on the regular
record date for such Interest Payment Date or from time to time further
extend such Period; provided that such Period together with all such
further extensions thereof shall not exceed 20 consecutive quarterly
interest periods. Upon the termination of any Extended Interest Payment
Period and upon the payment of all accrued and unpaid interest then due,
together with Compounded Interest, Holdings may select a new Extended
Interest Payment Period, subject to the foregoing requirements. No
interest shall be due and payable during an Extended Interest Payment
Period, except at the end thereof. At the end of the Extended Interest
Payment Period Holdings shall pay all interest accrued and unpaid on the
Junior Subordinated Debentures including any Compounded Interest which
shall be payable to the holders of the Junior Subordinated Debentures in
whose names the Junior Subordinated Debentures are registered in the
Debenture register on the record date for the first interest payment date
occurring on or after the end of the Extended Interest Payment Period.
Section 3.2. (a) So long as the Trust is the legal owner and
holder of record of the Junior Subordinated Debentures, at the time Holdings
selects an Extended Interest Payment Period, Holdings shall give both the
Institutional Trustee and the Trustee written notice of its selection of such
Extended Interest Payment Period one business day prior to the earlier of (i)
the next succeeding date on which distributions on the Preferred Securities
are payable or (ii) the date the Trust is required to give notice of the
record date or the date such distributions are payable to the New York Stock
Exchange or other applicable self-regulatory organization or to holders of the
Preferred Securities, but in any event not less than one business day prior to
such record date. Holdings shall cause the Trust to give notice of Holdings's
selection of such Extended Interest Payment Period to the holders of the
Preferred Securities.
(b) If as a result of a Dissolution Event, Junior Subordinated
Debentures have been distributed to holders of Preferred Securities and Common
Securities, at the time Holdings selects an Extended Interest Payment Period,
Holdings shall give the holders of the Junior Subordinated Debentures and the
Trustee written notice of its selection of such Extended Interest Payment
Period 10 business days prior to the earlier of (i) the next succeeding
Interest Payment Date or (ii) the date Holdings is required to give notice of
the record or payment date of such interest payment to the New York Stock
Exchange or other applicable self-regulatory organization or to holders of the
Junior Subordinated Debentures.
Section 3.3. The quarter in which any notice is given
pursuant to Section 3.02 shall be counted as one of the 20 quarters
permitted in the maximum Extended Interest Payment Period permitted under
this Article Three.
ARTICLE 4
Covenants Applicable to Junior Subordinated Debentures
Section 4.1. So long as any Preferred Securities remain
outstanding, Holdings will not declare or pay any dividend on, or redeem,
purchase, acquire or make a distribution or liquidation payment with
respect to, any of its common stock or preferred stock, or make any
guarantee payments with respect thereto, if at such time (i) Holdings
shall be in default with respect to its Guarantee Payments (as defined in
the Guarantee Agreement) or other payment obligations under the Guarantee
Agreement, (ii) there shall have occurred any Event of Default under the
Indenture with respect to the Junior Subordinated Debentures or (iii)
Holdings shall have given notice of its selection of an Extended Interest
Payment Period and such Period, or any extension thereof, is continuing;
provided that Holdings will be permitted to make payments under the
Preferred Securities Guarantee and to pay accrued dividends (and cash in
lieu of fractional shares) upon the conversion of any of its preferred
stock, including its ESOP Preferred Stock, in accordance with the terms of
such stock.
Section 4.2. In connection with the distribution of the
Junior Subordinated Debentures to the holders of the Preferred Securities
upon a Dissolution Event, Holdings will use its best efforts to list such
Junior Subordinated Debentures on the New York Stock Exchange or on such
other exchange as the Preferred Securities are then listed and traded.
Section 4.3. Holdings covenants and agrees for the benefit
of the holders of the Preferred Securities to comply fully with all of its
obligations and agreements under the Declaration of Trust, including,
without limitation, its obligations under Article 4 thereof.
Section 4.4. Prior to the distribution of Junior
Subordinated Debentures to the holders of Preferred Securities upon a
Dissolution Event, Holdings covenants and agrees for the benefit of the
holders of the Preferred Securities (i) not to cause or permit the Common
Securities to be transferred except as permitted by the Declaration of
Trust and (ii) not to take any action which would cause the Trust to cease
to be treated as a grantor trust for United States federal income tax
purposes, except in connection with a distribution of the Junior
Subordinated Debentures as provided in the Declaration of Trust.
ARTICLE 5
Form of Junior Subordinated Debentures
Section 5.1. The Junior Subordinated Debentures and the
Trustee's Certificate of Authentication to be endorsed thereon are to be
substantially in the following forms:
(FORM OF FACE OF DEBENTURE)
[IF THE NOTE IS TO BE A GLOBAL DEBENTURE, INSERT: This
Debenture is a Global Debenture within the meaning of the Indenture
hereinafter referred to and is registered in the name of a Depositary or a
nominee of a Depositary. This Debenture is exchangeable for Debentures
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 Debenture (other than a transfer of this Debenture 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 Debenture is presented by an authorized
representative to 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 Debenture 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. _________
RJR NABISCO HOLDINGS CORP.
___% JUNIOR SUBORDINATED DEBENTURE,
DUE 20___
RJR Nabisco Holdings Corp., a corporation duly organized and
existing under the laws of the State of Delaware (herein referred to as
"Holdings", 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 __________, 20___, and to pay interest on said principal sum
from and including o, 199o or from the most recent interest payment date
(each such date, an "Interest Payment Date") to which interest has been
paid or duly provided for, quarterly (subject to deferral as set forth
herein) in arrears on __________, __________, __________ and __________ of
each year commencing __________, 199__ at the rate of ___% per annum plus
Compounded Interest, if any, until the principal hereof shall have become
due and payable, and on any overdue principal and premium, if any, 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. The amount of interest payable on any Interest
Payment Date shall be computed on the basis of a 360-day year of twelve 30-
day months and for any period shorter than a full quarterly interest period
for which interest is computed, the amount of interest payable 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
Debenture 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
Interest Payment Date will, as provided in the Indenture, be paid to the
person in whose name this Debenture (or one or more Predecessor Debentures,
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 Business Day 15 days preceding such Interest 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
Debenture (or one or more Predecessor Debentures) 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 this series of Debentures not less than 10 days
prior to such special record date, or may be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities
exchange on which the Debentures may be listed, and upon such notice as may
be required by such exchange, all as more fully provided in the Indenture.
The principal of (and premium, if any) and the interest on this Debenture
shall be payable at the office or agency of Holdings maintained for that
purpose in the Borough of Manhattan, The City and State of New York, 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 Holdings by
check mailed to the registered holder at such address as shall appear in
the Debenture register and that the payment of principal will only be made
upon the surrender of this Debenture to the Trustee. Notwithstanding the
foregoing, so long as the owner and record holder of this Debenture is the
Trust (as defined in the Indenture referred to on the reverse hereof), the
payment of the principal of (and premium, if any) and interest (including
Compounded Interest, if any) on this Debenture will be made at such place
and to such account of the Trust as may be designated by the Institutional
Trustee.
The indebtedness evidenced by this Debenture is, to the extent
provided in the Indenture, subordinate and subject in right of payment to the
prior payment in full of all Senior Indebtedness, and this Debenture is issued
subject to the provisions of the Indenture with respect thereto. Each Holder
of this Debenture, by accepting the same (a) agrees to and shall be bound by
such provisions (b) authorizes and directs the Trustee on his behalf to take
such action as may be necessary or appropriate to acknowledge or effectuate the
subordination so provided an (c) appoints the Trustee his attorney-in-fact for
any and all such purposes. Each Holder hereof, by his 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,
whether now outstanding or hereafter incurred, and waives reliance by each
such Holder upon said provisions.
This Debenture 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.
Unless the Certificate of Authentication hereon has been
executed by the Trustee referred to on the reverse side hereof, this Debenture
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
The provisions of this Debenture 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, Holdings has caused this Instrument to be
executed.
Dated ___________ __, ____
RJR NABISCO HOLDINGS CORP.
By
------------------------------
Name: Xxxx X. Xxxxxxx
Title: Senior Vice President and
Treasurer
Attest:
By
-------------------------
Name: H. Xxxxx XxXxxxx
Title: Senior Vice President, Associate
General Counsel and Secretary
(FORM OF CERTIFICATE OF AUTHENTICATION)
CERTIFICATE OF AUTHENTICATION
This is one of the Debentures of the series of Debentures
described in the within-mentioned Indenture.
Dated:
The Bank of New York,
as Trustee
-------------------------
or as Authentication Agent
-------------------------
Authorized Signatory
By
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Authorized Signatory
(FORM OF REVERSE OF DEBENTURE)
This Debenture is one of a duly authorized series of debentures
of Holdings (herein sometimes referred to as the "Debentures"), all issued or
to be issued in one or more series under and pursuant to an Indenture dated as
of September 19, 1995 duly executed and delivered between Holdings and The
Bank of New York, a New York banking corporation, as Trustee (herein
referred to as the "Trustee"), as supplemented by the First Supplemental
Indenture dated as of September 21, 1995 between Holdings and the Trustee,
and as further supplemented by the [ ] Supplemental Indenture dated
as of _______, 199___ between Holdings and the Trustee (said Indenture as
so supplemented being hereinafter referred to as 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, Holdings and the holders of the
Debentures, and, to the extent specifically set forth in the Indenture, the
holders of Senior Indebtedness and Preferred Securities. By the terms of
the Indenture, the Debentures 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 Debentures is designated the ___%
Junior Subordinated Debentures due 20___ and is limited in aggregate
principal amount as specified in said [ ] Supplemental Indenture.
Except as provided in the next paragraph, the Debentures may
not be redeemed by Holdings prior to __________, 20___. Holdings shall
have the right to redeem this Debenture at the option of Holdings, without
premium or penalty, in whole or in part at any time on or after __________,
20___ (an "Optional Redemption"), at a redemption price equal to 100% of
the principal amount plus any accrued but unpaid interest, including any
Compounded Interest, if any, to the date of such redemption (the "Optional
Redemption Price"). Any redemption pursuant to this paragraph will be made
upon not less than 30 nor more than 60 days' notice, at the Optional
Redemption Price.
If, at any time, a Tax Event (as defined below) shall occur or
be continuing after receipt of a Dissolution Tax Opinion (as defined below) and
(i) the Regular Trustees and Holdings shall have received an opinion (a
"Redemption Tax Opinion") of a nationally recognized independent tax counsel
experienced in such matters that, as a result of a Tax Event, there is more
than an insubstantial risk that Holdings would be precluded from deducting the
interest on the Junior Subordinated Debentures for United States federal
income tax purposes even if the Junior Subordinated Debentures were
distributed to the holders of Preferred Securities and Common Securities in
liquidation of such holder's interest in the Trust as set forth in the
Declaration of Trust or (ii) the Regular Trustees shall have been informed by
such tax counsel that a No Recognition Opinion (as defined below) cannot be
delivered to the Trust, Holdings shall have the right at any time, upon not
less than 30 nor more than 60 days' notice, to redeem the Junior Subordinated
Debentures in whole or in part for cash at the Optional Redemption Price
within 90 days following the occurrence of such Tax Event; provided, however,
that, if at the time there is available to Holdings or the Regular Trustees on
behalf of the Trust the opportunity to eliminate, within such 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 Trust, Holdings or the
holders of the Preferred Securities, Holdings or the Regular Trustees on
behalf of the Trust will pursue such measure in lieu of redemption and
provided further that Holdings shall have no right to redeem the Junior
Subordinated Debentures while the Regular Trustees on behalf of the Trust are
pursuing any such Ministerial Action.
"Tax Event" means that Holdings and the Regular Trustees
shall have obtained an opinion of nationally recognized independent tax
counsel experienced in such matters (a "Dissolution Tax Opinion") to the
effect that on or after __________, 199___, as a result of (a) any
amendment to, or change (including any announced prospective change) in,
the laws (or any regulations thereunder) of the United States or any
political subdivision or taxing authority thereof or therein, (b) any
amendment to, or change in, an interpretation or application of any such
laws or regulations by any legislative body, court, governmental agency or
regulatory authority (including the enactment of any legislation and the
publication of any judicial decision or regulatory determination) (c) any
interpretation or pronouncement that provides for a position with respect
to such laws or regulations that differs from the theretofore generally
accepted position or (d) any action taken by any governmental agency or
regulatory authority, which amendment or change is enacted, promulgated,
issued or announced or which interpretation or pronouncement is issued or
announced or which action is taken, in each case on or after __________,
199___, there is more than an insubstantial risk that (i) the Trust is, or
will be within 90 days of the date thereof, subject to United States
federal income tax with respect to income accrued or received on the Junior
Subordinated Debentures, (ii) the Trust is, or will be within 90 days of
the date thereof, subject to more than a de minimis amount of taxes, duties
or other governmental charges or (iii) interest payable by Holdings to the
Trust on the Junior Subordinated Debentures is not, or within 90 days of
the date thereof will not be, deductible by Holdings for United States
federal income tax purposes.
"No Recognition Opinion" means an opinion of a nationally
recognized independent tax counsel experienced in such matters, which opinion
may rely on any then applicable published revenue ruling of the Internal
Revenue Service, to the effect that the holders of the Preferred Securities
will not recognize any gain or loss for United States federal income tax
purposes as a result of a dissolution of the Trust and distribution of the
Junior Subordinated Debentures as provided in the Declaration of Trust.
If the Debentures are only partially redeemed by Holdings
pursuant to an Optional Redemption or as a result of a Tax Event as described
above, the Debentures will be redeemed pro rata or by lot or in some other
equitable manner determined by the Trustee. Notwithstanding the foregoing, if
a partial redemption of the Junior Subordinated Debentures would result in the
delisting of the Preferred Securities by any national securities exchange or
other organization on which the Preferred Securities are then listed, Holdings
shall not be permitted to effect such partial redemption and will only redeem
the Junior Subordinated Debentures in whole.
In the event of redemption of this Debenture in part only, a new
Debenture or Debentures 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 Debentures 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 for defeasance at any time of
the entire indebtedness of this Debenture upon compliance by Holdings with
certain conditions set forth therein.
The Indenture contains provisions permitting Holdings and the
Trustee, with the consent of the Holders of not less than a majority in
aggregate principal amount of the Debentures of all series affected at the time
outstanding, as defined in the Indenture (and, in the case of any series of
Debentures held as trust assets of a RJR Nabisco Holdings Capital Trust and
with respect to which a Security Exchange has not theretofore occurred, such
consent of holders of the Preferred Securities and the Common Securities of
such RJR Nabisco Holdings Capital Trust as may be required under the
Declaration of Trust of such RJR Nabisco Holdings Capital Trust), 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 Debentures; provided, however, that no such supplemental
indenture shall (i) extend the final maturity of any Debentures of any series,
or reduce the principal amount thereof, or reduce the rate or extend the time
of payment of interest thereon (except that a valid extension of an interest
payment period by the Issuer shall not constitute an extension of interest for
this purpose), or reduce any amount payable upon the redemption thereof or
reduce the amount of the principal of an original issue discount Debenture that
would be due and payable upon an acceleration of the maturity thereof pursuant
to the Indenture or the amount thereof provable in bankruptcy pursuant to the
Indenture, or alter the provisions of the Indenture concerning liability of
officers of the Issuer and the parties to the Indenture or impair or affect
the right of any Debenture holder to institute suit for the payment thereof in
each case without the consent of the holder of each Debenture so affected
(and, in the case of any series of Securities held as trust assets of an RJR
Nabisco Holdings Capital Trust and with respect to which a Security Exchange
has not theretofore occurred, such consent of holders of the Preferred
Securities and the Common Securities of such RJR Nabisco Holdings Capital
Trust as may be required under the Declaration of Trust of such RJR Nabisco
Holdings Capital Trust), or (ii) reduce the aforesaid percentage of
Debentures, the holders of which are required to consent to any such
supplemental indenture, without the consent of the holders of each Debenture
(and, in the case of any series of Debentures held as trust assets of a RJR
Nabisco Holdings Capital Trust and with respect to which a Security Exchange
has not theretofore occurred, such consent of the holders of the Preferred
Securities and the Common Securities of such RJR Nabisco Holdings Capital
Trust as may be required under the Declaration of Trust of such RJR Nabisco
Holdings Capital Trust) affected thereby. The Indenture also contains
provisions permitting the Holders of a majority in aggregate principal amount
of the Debentures of all series at the time outstanding affected thereby
(subject, in the case of any series of Debentures held as trust assets of a RJR
Nabisco Holdings Capital Trust and with respect to which a Securities Exchange
has not theretofore occurred, to such consent of holders of Preferred
Securities and Common Securities of such RJR Nabisco Holdings Capital Trust
as may be required under the Declaration of Trust of such RJR Nabisco Holdings
Capital Trust), on behalf of the Holders of the Debentures of such series, 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 such
series, and its consequences, except a default in the payment of the principal
of or premium, if any, or interest on any of the Debentures of such series.
Any such consent or waiver by the registered Holder of this Debenture (unless
revoked as provided in the Indenture) shall be conclusive and binding upon
such Holder and upon all future Holders and owners of this Debenture and of
any Debenture 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 Debenture.
No reference herein to the Indenture and no provision of this
Debenture or of the Indenture shall alter or impair the obligation of
Holdings, which is absolute and unconditional, to pay the principal of and
premium, if any, and interest on this Debenture at the time and place at the
rate and in the money herein prescribed.
So long as Holdings is not in default in the payment of
interest on the Debentures, Holdings shall have the right, at any time during
the term of the Debentures, from time to time to extend the interest payment
period of such Debentures for up to 20 consecutive quarterly interest periods
(the "Extended Interest Payment Period"), at the end of which period Holdings
shall pay all interest then accrued and unpaid (together with interest thereon
at the rate of ___% per annum compounded quarterly to the extent permitted by
applicable law ("Compounded Interest")). During such Extended Interest
Payment Period Holdings shall not declare or pay any dividend on, or redeem,
purchase, acquire or make a distribution or liquidation payment with respect
to, any of its common stock or preferred stock, or make any guarantee payments
with respect thereto, provided that Holdings may pay accrued dividends (and
cash in lieu of fractional shares) upon mandatory conversion of any of its
preferred stock, including its ESOP Preferred Stock, in accordance with the
terms of such Stock. Prior to the termination of any such Extended Interest
Payment Period, Holdings may pay all or any portion of the interest accrued on
the Debentures on any Interest Payment Date to holders of record on the regular
record date for such Interest Payment Date or from time to time further extend
such Extended Interest Payment Period, provided that such Period together with
all such further extensions thereof shall not exceed 20 consecutive quarterly
interest periods. At the termination of any such Extended Interest Payment
Period and upon the payment of all accrued and unpaid interest then due,
together with Compounded Interest, Holdings may select a new Extended Interest
Payment Period, subject to the foregoing requirements. No interest on this
Debenture shall be due and payable during an Extended Interest Payment Period,
except at the end thereof. At the end of the Extended Interest Payment Period
Holdings shall pay all interest accrued and unpaid on the Junior Subordinated
Debentures including any Compounded Interest which shall be payable to the
holders of the Junior Subordinated Debentures in whose names the Junior
Subordinated Debentures are registered in the Debenture register on the record
date for the first interest payment date occurring on or after the end of the
Extended Interest Payment Period.
As provided in the Indenture and subject to certain limitations
therein set forth, this Debenture is transferable by the registered holder
hereof on the Debenture register of Holdings, upon surrender of this Debenture
for registration of transfer at the office or agency of Holdings in the
Borough of Manhattan, The City and State of New York accompanied by a written
instrument or instruments of transfer in form satisfactory to Holdings or the
Trustee duly executed by the registered holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Debentures of authorized
denominations and for the same aggregate principal amount and series will be
issued to the designated transferee or transferees. No service charge will be
made for any such transfer, but Holdings 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
Debenture, Holdings, the Trustee, any paying agent and any Debenture Registrar
may deem and treat the registered holder hereof as the absolute owner hereof
(whether or not this Debenture shall be overdue and notwithstanding any notice
of ownership or writing hereon made by anyone other than the Debenture
Registrar) for the purpose of receiving payment of or on account of the
principal hereof and premium, if any, and interest due hereon and for all other
purposes, and neither Holdings nor the Trustee nor any paying agent nor any
Debenture 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 Debenture, 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 Holdings 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 certificated Debentures -- The Debentures of this series are
issuable only in registered form without coupons in denominations of $25 and
any integral multiple thereof. As provided in the Indenture and subject to
certain limitations therein set forth, Debentures of this Series are
exchangeable for a like aggregate principal amount of Debentures of this
series of a different authorized denomination, as requested by the Holder
surrendering the same.
All terms used in this Debenture which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
ARTICLE 6
Original Issue of Junior Subordinated Debentures
Section 6.1. Junior Subordinated Debentures in the
aggregate principal amount equal to the sum of $__________ plus a dollar
amount equal to the principal amount of Junior Subordinated Debentures
purchased by the Trust with the proceeds received by the Trust from the
purchase by Holdings of the Common Securities of the Trust, may, upon
execution of this [ ] Supplemental Indenture, be executed by Holdings and
delivered to the Trustee for authentication, and the trustee shall
thereupon authenticate and deliver said Debentures to or upon the written
order of Holdings, signed by its Chairman, any Vice Chairman, its
President, or any Vice President and its Treasurer or an Assistant
Treasurer, without any further action by Holdings.
ARTICLE 7
Miscellaneous
Section 7.1. Except as otherwise expressly provided in this
[ ] Supplemental Indenture or in the form of Junior Subordinated
Debenture or otherwise clearly required by the context hereof or thereof,
all terms used herein or in said form of Junior Subordinated Debenture that
are defined in the Indenture shall have the several meanings respectively
assigned to them thereby.
Section 7.2. The Indenture, as supplemented by this [ ]
Supplemental Indenture, is in all respects ratified and confirmed, and this
[ ] Supplemental Indenture shall be deemed part of the Indenture in the
manner and to the extent herein and therein provided.
Section 7.3. The recitals herein contained are made by
Holdings 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 [ ] Supplemental Indenture.
Section 7.4. This [ ] 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.
IN WITNESS WHEREOF, the parties hereto have caused this [ ]
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.
RJR NABISCO HOLDINGS CORP.
By
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Name:
Title:
Attest:
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Name:
Title:
THE BANK OF NEW YORK, as Trustee
By
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Name:
Title:
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK ) __________, 199___
On the ______ day of _______, in the year one thousand nine
hundred ninety-___, before me personally came ________________ to me known,
who, being by me duly sworn, did depose and say that he resides at
____________________ ___________________________________; that he is
____________ ______________________ of RJR NABISCO HOLDINGS CORP., 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.
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NOTARY PUBLIC
My Commission Expires
