<PAGE> 1
As filed with the Securities and Exchange Commission on August 27, 1997
Registration No. 333-__________
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-4
REGISTRATION STATEMENT
UNDER THE
SECURITIES ACT OF 1933
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AGL RESOURCES INC.
AGL CAPITAL TRUST
(Exact name of registrants as specified in their charters)
GEORGIA 4924 58-2210952
DELAWARE 6159 APPLIED FOR
(State of (Primary Standard Industrial (I.R.S. Employer
Incorporation) Classification Code Number) Identification Number)
303 PEACHTREE STREET, N.E.
ATLANTA, GEORGIA 30308
(404) 584-9470
(Address, including zip code, and telephone number, including area code, of
registrants' principal executive offices)
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J. MICHAEL RILEY
VICE PRESIDENT AND CHIEF FINANCIAL OFFICER
AGL RESOURCES INC.
303 PEACHTREE STREET, N.E.
ATLANTA, GEORGIA 30308
(404) 584-9470
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
Copies to:
William L. Floyd
Long Aldridge & Norman LLP
5300 One Peachtree Center
303 Peachtree Street, N.E.
Atlanta, Georgia 30308
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Approximate date of commencement of proposed sale to the public: As
soon as practicable after this Registration Statement becomes effective.
If any of the securities being registered on this Form are to be
offered in connection with the formation of a holding company and there is
compliance with General Instruction G, check the following box. [ ]
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<PAGE> 2
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
===================================================================================================
Title of Each Proposed Proposed
Class of Maximum Maximum Amount of
Securities to be Amount to Offering Aggregate Registration
Registered be Registered Price Per Unit(1) Offering Price(1) Fee(1)
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Series B 8.17% 75,000 Capital $ 1,000 $ 75,000,000 $ 22,728
Capital Securities Securities
of AGL Capital
Trust
===================================================================================================
Series B 8.17%
Junior
Subordinated
Deferrable Interest
Debentures of
AGL Resources
Inc.(2)
==================================================================================================
AGL Resources
Inc. Exchange
Guarantee with
respect to the
Series B 8.17%
Capital Securities
of AGL Capital
Trust(3)
==================================================================================================
Total(4)(5) $ 1,000 $ 75,000,000 $ 22,728
==================================================================================================
</TABLE>
(1) Estimated solely for the purpose of computing the registration fee.
(2) No separate consideration will be received for the Series B 8.17%
Junior Subordinated Deferrable Interest Debentures (the "Exchange
Debentures") of AGL Resources Inc.
(3) No separate consideration will be received for the AGL Resources Inc.
Exchange Guarantee and pursuant to Rule 457(n) under the Securities Act
no separate fee is payable.
(4) This Registration Statement is deemed to cover rights of holders of
Exchange Debentures under the Indenture, the rights of holders of
Series B 8.17% Capital Securities of AGL Capital Trust (the "Exchange
Capital Securities") under an Amended and Restated Declaration of
Trust, the rights of holders of such Exchange Capital Securities under
the Exchange Guarantee and certain backup undertakings as described
herein.
(5) Such amount represents the liquidation amount of AGL Capital Trust
Exchange Capital Securities to be exchanged hereunder and the principal
amount of Exchange Debentures that may be distributed to holders of
such Exchange Capital Securities upon any liquidation of AGL Capital
Trust.
<PAGE> 3
--------------------
THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE
OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
<PAGE> 4
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BY ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED _________________, 1997
PROSPECTUS
AGL CAPITAL TRUST
OFFER TO EXCHANGE ITS SERIES B 8.17% CAPITAL SECURITIES (LIQUIDATION AMOUNT
$1,000 PER EXCHANGE CAPITAL SECURITY) WHICH HAVE BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933 FOR ANY AND ALL OF ITS OUTSTANDING
SERIES A 8.17% CAPITAL SECURITIES
(LIQUIDATION AMOUNT $1,000 PER ORIGINAL CAPITAL SECURITY)
FULLY AND UNCONDITIONALLY GUARANTEED, AS DESCRIBED HEREIN, BY
AGL RESOURCES INC.
THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON ______________,1997, UNLESS EXTENDED.
AGL Capital Trust, a statutory business trust formed under the laws of
the State of Delaware (the "Trust"), hereby offers, upon the terms and subject
to the conditions set forth in this Prospectus (as the same may be amended or
supplemented from time to time, the "Prospectus") and in the accompanying Letter
of Transmittal (which together constitute the "Exchange Offer"), to exchange up
to 75,000 of its Series B 8.17% Capital Securities, Liquidation Amount $1,000
per security (the "Exchange Capital Securities"), which have been registered
under the Securities Act of 1933, as amended (the "Securities Act"), pursuant to
a registration statement (the "Registration Statement") of which this Prospectus
constitutes a part, for a like number of its outstanding Series A 8.17% Capital
Securities, Liquidation Amount $1,000 per security (the "Original Capital
Securities"), of which 75,000 are issued and outstanding. Pursuant to the
Exchange Offer, AGL Resources Inc., a Georgia corporation ("AGL Resources"), is
also offering to exchange (i) its guarantee of payments of cash distributions
and payments on liquidation of the Trust or redemption of the Original Capital
Securities (the "Original Guarantee") for a like guarantee in respect of the
Exchange Capital Securities (the "Exchange Guarantee") and (ii) $75,000,000
aggregate principal amount of its Series A 8.17% Junior Subordinated Deferrable
Interest Debentures due June 1, 2037 (the "Original Junior Subordinated
Debentures") for a like aggregate principal amount of its Series B 8.17% Junior
Subordinated Deferrable Interest Debentures due June 1, 2037 (the "Exchange
Junior Subordinated Debentures"), which Exchange Guarantee and Exchange Junior
Subordinated Debentures also have been registered under the Securities Act. The
Original Capital Securities, the Original Guarantee and the Original Junior
Subordinated Debentures are collectively referred to herein as the "Original
Securities" and the Exchange Capital Securities, the Exchange Guarantee and the
Exchange Junior Subordinated Debentures are collectively referred to herein as
the "Exchange Securities."
The terms of the Exchange Securities are identical in all material
respects to the respective terms of the Original Securities, except that (i) the
Exchange Securities have been registered under the Securities Act and therefore
will not be subject to certain restrictions on transfer applicable to the
Original Securities, (ii) the Exchange Capital Securities will not contain the
$100,000 minimum Liquidation Amount transfer restriction, (iii) the Exchange
Capital Securities will not provide for any increase in the Distribution Rate
(as defined herein) thereon, and (iv) the Exchange Junior Subordinated
Debentures will not provide for any increase in the interest rate thereon. See
"Description of Exchange Securities" and "Description of Original Securities."
The Exchange Capital Securities are being offered for exchange in order to
satisfy certain obligations of AGL Resources and the Trust under the
Registration Rights Agreement dated as of June 11, 1997 (the "Registration
Rights Agreement"), among AGL Resources, the Trust, and the Initial Purchasers
(as defined herein). In the event that the Exchange Offer is consummated, any
Original Capital Securities which remain outstanding after consummation of the
Exchange Offer and the Exchange Capital Securities issued in the Exchange Offer
will vote together as a single class for purposes of determining whether holders
of the requisite percentage in outstanding Liquidation Amount thereof have taken
certain actions or exercised certain rights under the Declaration of Trust (as
defined herein). (continued on the following page)
This Prospectus and the Letter of Transmittal are first being mailed to
all holders of Original Capital Securities on ___________, 1997.
SEE "RISK FACTORS" COMMENCING ON PAGE ___ FOR CERTAIN INFORMATION THAT SHOULD BE
CONSIDERED BY HOLDERS IN DECIDING WHETHER TO TENDER ORIGINAL CAPITAL SECURITIES
IN THE EXCHANGE OFFER.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SE-
CURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMIS-
SION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is ________________________ , 1997.
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(continued from previous page)
The Exchange Capital Securities and the Original Capital Securities
(collectively, the "Capital Securities") represent beneficial interests in the
assets of the Trust. AGL Resources is the owner of all of the beneficial
interests represented by common securities of the Trust (the "Common
Securities," and together with the Capital Securities, the "Trust Securities").
The Bank of New York is the Property Trustee (the "Property Trustee") of the
Trust. The Trust exists for the sole purpose of issuing the Trust Securities and
investing the proceeds thereof in the Junior Subordinated Debentures (as defined
herein). The Junior Subordinated Debentures will mature on June 1, 2037 (the
"Stated Maturity Date"). The Capital Securities will have a preference over the
Common Securities under certain circumstances with respect to cash distributions
and amounts payable on liquidation, redemption, or otherwise. See "Description
of Exchange Securities--Description of Exchange Capital
Securities--Subordination of Common Securities."
As used herein, (i) the "Indenture" means the Indenture, dated as of
June 11, 1997, as amended and supplemented from time to time, between AGL
Resources and The Bank of New York, as trustee (the "Indenture Trustee"),
relating to the Junior Subordinated Debentures, (ii) the "Declaration of Trust"
means the Amended and Restated Declaration of Trust relating to the Trust among
AGL Resources, as Sponsor, The Bank of New York, as Property Trustee, The Bank
of New York (Delaware), an affiliate of the Property Trustee, as Delaware
Trustee (the "Delaware Trustee"), and the Administrative Trustees named therein
(collectively, with the Property Trustee and Delaware Trustee, the "Trustees"),
(iii) the "Guarantee" means the Capital Securities Guarantee Agreement relating
to the Capital Securities between AGL Resources and The Bank of New York, as
trustee (the "Guarantee Trustee"), and (iv) the "Common Guarantee" means the
Common Securities Guarantee Agreement relating to the Common Securities between
AGL Resources and The Bank of New York, as trustee. In addition, as the context
may require, (i) "Junior Subordinated Debentures" includes the Original Junior
Subordinated Debentures and the Exchange Junior Subordinated Debentures, and
(ii) "Guarantee" includes the Original Guarantee and the Exchange Guarantee.
The Junior Subordinated Debentures are unsecured obligations of AGL
Resources and are subordinate and junior in right of payment to all Senior
Indebtedness (as defined herein) of AGL Resources, as described herein. Holders
of the Capital Securities and the Common Securities are entitled to receive
cumulative cash distributions arising from the payment of interest on the Junior
Subordinated Debentures ("Distribution"), accruing from the date of original
issuance and payable semi-annually in arrears on June 1 and December 1 of each
year (each, a "Distribution Date"), commencing on December 1, 1997, at the
annual rate of 8.17% of the Liquidation Amount of $1,000 per Trust Security (the
"Distribution Rate").
The Distribution Rate and the Distribution Dates for the Capital
Securities correspond to the interest rate and interest and other payment dates
on the Junior Subordinated Debentures, which constitute substantially all of the
assets of the Trust. As a result, if principal or interest is not paid on the
Junior Subordinated Debentures, no amounts will be paid on the Capital
Securities. SO LONG AS NO DEBENTURE EVENT OF DEFAULT (AS DEFINED HEREIN) HAS
OCCURRED AND IS CONTINUING, AGL RESOURCES WILL HAVE THE RIGHT TO DEFER PAYMENTS
OF INTEREST ON THE JUNIOR SUBORDINATED DEBENTURES AT ANY TIME AND FROM TIME TO
TIME FOR A PERIOD NOT EXCEEDING 10 CONSECUTIVE SEMI-ANNUAL PERIODS WITH RESPECT
TO EACH DEFERRAL PERIOD (EACH, AN "EXTENSION PERIOD"), PROVIDED THAT NO
EXTENSION PERIOD MAY EXTEND BEYOND THE STATED MATURITY DATE. Upon the
termination of any such Extension Period and the payment of all amounts then
due, AGL Resources may elect to begin a new Extension Period, subject to the
requirements set forth herein. Subject to the above, there is no limitation on
the number of times AGL Resources may elect to begin an Extension Period. If and
for so long as interest payments on the Junior Subordinated Debentures are so
deferred, Distributions on the Trust Securities will also be deferred and AGL
Resources will not be permitted, subject to certain exceptions described herein,
to declare or pay any dividend or distribution on AGL Resources' capital stock
or make any guarantee payments with respect to the foregoing, or make any
payment on any debt securities of AGL Resources that rank pari passu with or
junior to the Junior Subordinated Debentures. During an Extension Period,
interest on the Junior Subordinated Debentures will continue to accrue (and the
amount of Distributions to which holders of the Trust Securities are entitled
will continue to accumulate) at the Distribution Rate, compounded semi-annually,
2
<PAGE> 6
(continued from previous page)
and holders of Capital Securities will be required to accrue income in the form
of original issue discount ("OID") in their gross income for United States
federal income tax purposes prior to the receipt of the cash attributable to
such income. See "Description of Exchange Junior Subordinated Debentures--Option
to Extend Interest Payment Date" and "Certain Federal Income Tax
Consequences--Interest Income and Original Issue Discount."
AGL Resources has, through the Guarantee, the Common Guarantee, the
Declaration of Trust, the Junior Subordinated Debentures and the Indenture,
taken together, fully and unconditionally guaranteed, subject to certain
subordination provisions, all of the Trust's obligations under the Trust
Securities. See "Relationship Among the Exchange Capital Securities, the
Exchange Junior Subordinated Debentures and the Exchange Guarantee--Full and
Unconditional Guarantee." The Guarantee and the Common Guarantee will guarantee
payments of Distributions and payments on liquidation or redemption of the Trust
Securities, but in each case only to the extent that the Trust has funds on hand
legally and immediately available therefor and has failed to make such payments,
as described herein. See "Description of Exchange Securities" and "Description
of Exchange Guarantee." If AGL Resources fails to make a required payment on the
Junior Subordinated Debentures, the Trust will not have sufficient funds to pay
such Distributions. The Guarantee and the Common Guarantee will not cover any
such payment when the Trust does not have sufficient funds legally available
therefor. In such event, the remedy of a holder of Capital Securities is to
enforce the Junior Subordinated Debentures. See "Description of Exchange Junior
Subordinated Debentures--Enforcement of Certain Rights by Holders of Capital
Securities." The obligations of AGL Resources under the Guarantee, the Common
Guarantee and the Junior Subordinated Debentures will be unsecured and
subordinate and junior in right of payment to all of its other liabilities.
The Trust Securities will be subject to mandatory redemption in a Like
Amount (as defined herein), (i) in whole but not in part, on the Stated Maturity
Date upon repayment of the Junior Subordinated Debentures at a redemption price
equal to the principal amount of, plus accrued and unpaid interest on, the
Junior Subordinated Debentures (the "Maturity Redemption Price"), (ii) in whole
but not in part, at any time prior to June 1, 2007, contemporaneously with the
optional prepayment of the Junior Subordinated Debentures, upon the occurrence
and continuation of a Tax Event (as defined herein) or an Investment Company Act
Event (as defined herein) at a redemption price equal to the Special Event
Prepayment Price (as defined herein) (the "Special Event Redemption Price"), and
(iii) in whole or in part, on or after June 1, 2007, contemporaneously with the
optional prepayment by AGL Resources of the Junior Subordinated Debentures, at a
redemption price equal to the Optional Prepayment Price (as defined herein) (the
"Optional Redemption Price"). Any of the Maturity Redemption Price, the Special
Event Redemption Price and the Optional Redemption Price may be referred to
herein as the "Redemption Price." See "Description of Exchange Capital
Securities--Redemption."
The Junior Subordinated Debentures will be prepayable prior to the
Stated Maturity Date at the option of AGL Resources (i) in whole or in part, on
or after June 1, 2007, at a prepayment price (the "Optional Prepayment Price")
equal to 104.085% of the principal amount thereof on June 1, 2007, declining
ratably on each June 1 thereafter to 100% on or after June 1, 2017, plus accrued
and unpaid interest thereon to the date of prepayment, or (ii) at any time prior
to June 1, 2007, and within 90 days of a Tax Event or an Investment Company Act
Event (each a "Special Event"), in whole but not in part, upon the occurrence
and continuation of a Special Event at a prepayment price (the "Special Event
Prepayment Price") equal to the greater of (a) 100% of the principal amount of
the Junior Subordinated Debenture to be redeemed or (b) the sum, as determined
by a Quotation Agent (as defined herein), of the present values of the principal
amount and premium payable with respect to an optional redemption of such Junior
Subordinated Debentures on June 1, 2007, together with scheduled payments of
interest on the Junior Subordinated Debentures accruing from the prepayment date
to and including June 1, 2007 discounted to the prepayment date on a semi-annual
basis (assuming a 360-day year consisting of twelve 30-day months) at the
Adjusted Treasury Rate (as defined herein) plus, in each case, accrued and
unpaid interest thereon to the date of prepayment. Either of the Optional
Prepayment Price or the Special Event Prepayment Price may be referred to herein
as the "Prepayment Price." See "Description of Exchange Junior Subordinated
Debentures--Optional Prepayment" and "--Special Event Prepayment."
AGL Resources will have the right at any time to terminate the Trust
and cause a Like Amount of the Junior Subordinated Debentures to be distributed
to the holders of the Trust Securities in liquidation of the Trust, subject to
AGL Resources having received an opinion of counsel to the effect that such
distribution will not be a taxable event to
3
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(continued from previous page)
holders of Capital Securities. Unless the Junior Subordinated Debentures are
distributed to the holders of the Trust Securities, in the event of a
liquidation of the Trust as described herein, after satisfaction of liabilities
to creditors of the Trust as required by applicable law, the holders of the
Trust Securities generally will be entitled to receive a Liquidation Amount of
$1,000 per Trust Security plus accumulated and unpaid Distributions thereon to
the date of payment. See "Description of Exchange Capital
Securities--Liquidation of the Trust and Distribution of Junior Subordinated
Debentures."
The Trust is making the Exchange Offer of the Exchange Capital
Securities in reliance on the position of the staff of the Division of
Corporation Finance of the Securities and Exchange Commission (the "Commission")
as set forth in certain interpretive letters addressed to third parties in other
transactions. However, neither AGL Resources nor the Trust has sought its own
interpretive letter and there can be no assurance that the staff of the Division
of Corporation Finance of the Commission would make a similar determination with
respect to the Exchange Offer as it has in such interpretive letters to third
parties. Based on these interpretations by the staff of the Division of
Corporation Finance of the Commission, and subject to the two immediately
following sentences, AGL Resources and the Trust believe that Exchange Capital
Securities issued pursuant to this Exchange Offer in exchange for Original
Capital Securities may be offered for resale, resold and otherwise transferred
by a holder thereof (other than a holder who is a broker-dealer) without further
compliance with the registration and prospectus delivery requirements of the
Securities Act, provided that such Exchange Capital Securities are acquired in
the ordinary course of such holder's business and that such holder is not
participating, and has no arrangement or understanding with any Person to
participate, in a distribution (within the meaning of the Securities Act) of
such Exchange Capital Securities. However, any holder of Original Capital
Securities who is an "affiliate" of AGL Resources or the Trust or who intends to
participate in the Exchange Offer for the purpose of distributing Exchange
Capital Securities, or any broker-dealer who purchased Original Capital
Securities from the Trust to resell pursuant to Rule 144A under the Securities
Act ("Rule 144A") or any other available exemption under the Securities Act, (a)
will not be able to rely on the interpretations of the staff of the Division of
Corporation Finance of the Commission set forth in the above-mentioned
interpretive letters, (b) will not be permitted or entitled to tender such
Original Capital Securities in the Exchange Offer, and (c) must comply with the
registration and prospectus delivery requirements of the Securities Act in
connection with any sale or other transfer of such Original Capital Securities
unless such sale is made pursuant to an exemption from such requirements. In
addition, as described below, if any broker-dealer holds Original Capital
Securities acquired for its own account as a result of market-making or other
trading activities and exchanges such Original Capital Securities for Exchange
Capital Securities, then such broker-dealer must deliver a prospectus meeting
the requirements of the Securities Act in connection with any resales of such
Exchange Capital Securities.
Each holder of Original Capital Securities who wishes to exchange
Original Capital Securities for Exchange Capital Securities in the Exchange
Offer will be required to represent that (i) it is not an "affiliate" of AGL
Resources or the Trust, (ii) any Exchange Capital Securities to be received by
it are being acquired in the ordinary course of its business, (iii) it has no
arrangement or understanding with any Person to participate in a distribution
(within the meaning of the Securities Act) of such Exchange Capital Securities,
and (iv) if such holder is not a broker-dealer, such holder is not engaged in,
and does not intend to engage in, a distribution (within the meaning of the
Securities Act) of such Exchange Capital Securities. In addition, AGL Resources
and the Trust may require such holder, as a condition to such holder's
eligibility to participate in the Exchange Offer, to furnish to AGL Resources
and the Trust (or an agent thereof) in writing information as to the number of
"beneficial owners" (within the meaning of Rule 13d-3 under the Securities
Exchange Act of 1934, as amended (the "Exchange Act")) on behalf of whom such
holder holds the Capital Securities to be exchanged in the Exchange Offer. Each
broker-dealer that receives Exchange Capital Securities for its own account
pursuant to the Exchange Offer must acknowledge that it acquired the Original
Capital Securities for its own account as the result of market-making activities
or other trading activities and must agree that it will deliver a prospectus
meeting the requirements of the Securities Act in connection with any resale of
such Exchange Capital Securities. The Letter of Transmittal states that by so
acknowledging and by delivering a prospectus, a broker-dealer will not be deemed
to admit that it is an "underwriter" within the meaning of the Securities Act.
Based on the position taken by the staff of the Division of Corporation Finance
of the Commission in the interpretive letters referred to above, AGL Resources
and the Trust believe that broker-dealers who acquired Original Capital
Securities for their own accounts, as a result of market-making activities or
other trading activities ("Participating Broker-Dealers"), may fulfill their
prospectus
4
<PAGE> 8
(continued from previous page)
delivery requirements with respect to the Exchange Capital Securities received
upon exchange of such Original Capital Securities (other than Original Capital
Securities which represent an unsold allotment from the initial sale of the
Original Capital Securities) with a prospectus meeting the requirements of the
Securities Act, which may be the prospectus prepared for an exchange offer so
long as it contains a description of the plan of distribution with respect to
the resale of such Exchange Capital Securities. Each broker-dealer that receives
Exchange Capital Securities for its own account pursuant to the Exchange Offer
must acknowledge that it will deliver a prospectus in connection with any resale
of such Exchange Capital Securities. The Letter of Transmittal states that by so
acknowledging and by delivery of a prospectus, a broker-dealer will not be
deemed to admit that it is an "underwriter" within the meaning of the Securities
Act. This Prospectus, as it may be amended or supplemented from time to time,
may be used by a broker-dealer in connection with resales of Exchange Capital
Securities received in exchange for Original Capital Securities acquired by such
broker-dealer as a result of market-making activities or other trading
activities. The Trust and AGL Resources have agreed that, ending on the close of
business on the 180th day following the Expiration Date (as defined herein), or,
if earlier, when all such Exchange Capital Securities have been disposed of by
such broker-dealer, it will make this Prospectus available to any broker-dealer
for use in connection with any such resale. See "Plan of Distribution." However,
a Participating Broker-Dealer who intends to use this Prospectus in connection
with the resale of Exchange Capital Securities received in exchange for Original
Capital Securities pursuant to the Exchange Offer must notify AGL Resources or
the Trust, or cause AGL Resources or the Trust to be notified, on or prior to
the Expiration Date (as defined herein), that it is a Participating
Broker-Dealer. Such notice may be given in the space provided for that purpose
in the Letter of Transmittal or may be delivered to the Exchange Agent (as
defined herein) at one of the addresses set forth herein under "The Exchange
Offer--Exchange Agent." Any Participating Broker-Dealer who is an "affiliate" of
AGL Resources or the Trust may not rely on such interpretive letters and must
comply with the registration and prospectus delivery requirements of the
Securities Act in connection with any resale transaction. See "The Exchange
Offer--Resales of Exchange Capital Securities."
In that regard, each Participating Broker-Dealer who surrenders
Original Capital Securities pursuant to the Exchange Offer will be deemed to
have agreed, by execution of the Letter of Transmittal, that upon receipt of
notice from AGL Resources or the Trust of the occurrence of any event or the
discovery of any fact which makes any statement contained or incorporated by
reference in this Prospectus untrue in any material respect or which causes this
Prospectus to omit to state a material fact necessary in order to make the
statements contained or incorporated by reference herein, in light of the
circumstances under which they were made, not misleading or of the occurrence of
certain other events specified in the Registration Rights Agreement, such
Participating Broker-Dealer will suspend the sale of Exchange Capital Securities
(or the Exchange Guarantee or the Exchange Junior Subordinated Debentures, as
applicable) pursuant to this Prospectus until AGL Resources or the Trust has
amended or supplemented this Prospectus to correct such misstatement or omission
and has furnished copies of the amended or supplemented Prospectus to such
Participating Broker-Dealer, or AGL Resources or the Trust has given notice that
the sale of the Exchange Capital Securities (or the Exchange Guarantee or the
Exchange Junior Subordinated Debentures, as applicable) may be resumed, as the
case may be. If AGL Resources or the Trust gives such notice to suspend the sale
of the Exchange Capital Securities (or the Exchange Guarantee or the Exchange
Junior Subordinated Debentures, as applicable), it shall extend the 180-day
period referred to above during which Participating Broker-Dealers are entitled
to use this Prospectus in connection with the resale of Exchange Capital
Securities by the number of days during the period from and including the date
of the giving of such notice to and including the date when Participating
Broker-Dealers shall have received copies of the amended or supplemented
Prospectus necessary to permit resales of the Exchange Capital Securities or to
and including the date on which AGL Resources or the Trust has given notice that
the sale of Exchange Capital Securities (or the Exchange Guarantee or the
Exchange Junior Subordinated Debentures, as applicable) may be resumed, as the
case may be.
Prior to the Exchange Offer, there has been only a limited secondary
market and no public market for the Original Capital Securities. The Exchange
Capital Securities will be a new issue of securities for which there currently
is no market. Although Merrill Lynch, Pierce, Fenner & Smith Incorporated,
Goldman, Sachs & Co. and Salomon Brothers Inc, the initial purchasers of the
Original Capital Securities (the "Initial Purchasers"), have informed AGL
Resources and the Trust that they each currently intend to make a market in the
Exchange Capital Securities, they are not obligated to do so, and any such
market making may be discontinued at any time without notice. Accordingly, there
can be no assurance as to the development or liquidity of any market for the
Exchange Capital Securities. AGL
5
<PAGE> 9
(continued from previous page)
Resources and the Trust currently do not intend to apply for listing of the
Exchange Capital Securities on any securities exchange or for quotation through
the NASD Automated Quotation System. See "Risk Factors--Absence of Public
Market."
Any Original Capital Securities not tendered and accepted in the
Exchange Offer will remain outstanding and will be entitled to all the same
rights and will be subject to the same limitations applicable thereto under the
Declaration of Trust (except for those rights which terminate upon consummation
of the Exchange Offer). Following consummation of the Exchange Offer, the
holders of Original Capital Securities will continue to be subject to all of the
existing restrictions upon transfer thereof and neither AGL Resources nor the
Trust will have any further obligation to such holders (other than under certain
limited circumstances) to provide for registration under the Securities Act of
the Original Capital Securities held by them. To the extent that Original
Capital Securities are tendered and accepted in the Exchange Offer, a holder's
ability to sell untendered Original Capital Securities could be adversely
affected. See "Risk Factors--Consequences of a Failure to Exchange Original
Capital Securities."
THIS PROSPECTUS AND THE RELATED LETTER OF TRANSMITTAL CONTAIN IMPORTANT
INFORMATION. HOLDERS OF ORIGINAL CAPITAL SECURITIES ARE URGED TO READ THIS
PROSPECTUS AND THE RELATED LETTER OF TRANSMITTAL CAREFULLY BEFORE DECIDING
WHETHER TO TENDER THEIR ORIGINAL CAPITAL SECURITIES PURSUANT TO THE EXCHANGE
OFFER.
Original Capital Securities may be tendered for exchange on or prior to
5:00 p.m., New York City time, on ______, 1997 (such time on such date being
hereinafter called the "Expiration Date"), unless the Exchange Offer is extended
by AGL Resources or the Trust (in which case the term "Expiration Date" shall
mean the latest date and time to which the Exchange Offer is extended). Tenders
of Original Capital Securities may be withdrawn at any time on or prior to the
Expiration Date. The Exchange Offer is not conditioned upon any minimum number
of Original Capital Securities being tendered for exchange. However, the
Exchange Offer is subject to certain events and conditions which may be waived
by AGL Resources or the Trust and to the terms and provisions of the
Registration Rights Agreement. Original Capital Securities may be tendered in
whole or in part having an aggregate Liquidation Amount of not less than
$100,000 (100 Capital Securities) or any integral multiple of $1,000 Liquidation
Amount (one Capital Security) in excess thereof. AGL Resources has agreed to pay
all expenses of the Exchange Offer. See "The Exchange Offer--Fees and Expenses."
Distributions on each Exchange Capital Security and interest on each Exchange
Junior Subordinated Debenture will accrue from the last date on which a
Distribution or interest was paid on the Original Capital Security or Original
Junior Subordinated Debenture tendered in exchange therefor or, if no
Distribution or interest has been paid on such Original Capital Security or
Original Junior Subordinated Debenture, from the date of original issuance of
the Original Capital Security or Original Junior Subordinated Debenture tendered
in exchange therefor. See "The Exchange Offer--Distributions on Exchange Capital
Securities."
Neither AGL Resources nor the Trust will receive any cash proceeds from
the issuance of the Exchange Capital Securities offered hereby. No
dealer-manager is being used in connection with this Exchange Offer. See "Use of
Proceeds" and "Plan of Distribution."
-------------
6
<PAGE> 10
AVAILABLE INFORMATION
AGL Resources is subject to the informational requirements of the
Exchange Act, and in accordance therewith files periodic reports, proxy
statements and other information with the Commission. Such reports, proxy
statements and other information may be inspected, without charge, and copies
may be obtained at prescribed rates, at the Commission's public reference
facility at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549 and at the
Commission's regional offices at 7 World Trade Center, 13th Floor, Suite 1300,
New York, New York 10048 and Suite 1400, Citicorp Center, 500 West Madison
Street, Chicago, Illinois 60661. Copies of such material may also be obtained at
prescribed rates by writing to the Public Reference Section of the Commission at
450 Fifth Street, N.W., Washington, D.C. 20549. The Commission maintains a Web
site that contains reports, proxy and information statements and other
information regarding registrants, including AGL Resources, at
http://www.sec.gov. In addition, reports and other material concerning AGL
Resources may be inspected at the offices of the New York Stock Exchange, 20
Broad Street, New York, New York 10005, on which Exchange the Common Stock of
AGL Resources is listed.
No separate financial statements of the Trust have been included
herein. AGL Resources and the Trust do not consider that such financial
statements would be material to holders of the Exchange Capital Securities
because the Trust is a special purpose entity, has no operating history or
independent operations, and is not engaged in and does not propose to engage in
any activity other than holding as trust assets the Junior Subordinated
Debentures, issuing the Trust Securities, and engaging in other activities as
are necessary, advisable, or incidental thereto. See "AGL Capital Trust,"
"Description of the Exchange Capital Securities," "Description of the Exchange
Junior Subordinated Debentures," and "Description of the Exchange Guarantee." In
addition, AGL Resources does not expect that the Trust will file reports, proxy
statements and other information under the Exchange Act with the Commission.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents have been filed by AGL Resources with the
Commission pursuant to the Exchange Act and are incorporated herein by reference
and made a part of this Prospectus:
(a) AGL Resources' Annual Report on Form 10-K for the fiscal year ended
September 30, 1996; and
(b) AGL Resources' Quarterly Reports on Form 10-Q for the quarters
ended December 31, 1996, March 31, 1997, and June 30, 1997.
All documents filed by AGL Resources with the Commission pursuant to
Section 13(a), 13(c), 14, or 15(d) of the Exchange Act subsequent to the date of
this Prospectus and prior to the termination of the Exchange Offer shall be
deemed to be incorporated herein by reference and made a part of this Prospectus
from the respective dates of filing of such documents. Any statement contained
in a document incorporated or deemed to be incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this Prospectus to
the extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Prospectus.
As used herein, the terms "Prospectus" and "herein" mean this
Prospectus, including the documents incorporated or deemed to be incorporated
herein by reference, as the same may be amended, supplemented, or otherwise
modified from time to time. Statements contained in this Prospectus as to the
contents of any contract or other document referred to herein do not purport to
be complete, and where reference is made to the particular provisions of such
contract or other document, such provisions are qualified in all respects by
reference to all of the provisions of such contract or other document.
AGL RESOURCES WILL PROVIDE WITHOUT CHARGE TO EACH PERSON TO WHOM THIS
PROSPECTUS IS DELIVERED, ON THE WRITTEN OR ORAL REQUEST OF ANY SUCH PERSON, A
COPY OF ANY OR ALL DOCUMENTS INCORPORATED HEREIN BY REFERENCE (OTHER THAN THE
EXHIBITS TO SUCH DOCUMENTS UNLESS SUCH EXHIBITS ARE SPECIFICALLY INCORPORATED BY
REFERENCE). SUCH REQUESTS SHOULD BE DIRECTED TO: OFFICE OF THE CORPORATE
SECRETARY, AGL RESOURCES INC., 303 PEACHTREE STREET, N.E., ATLANTA, GEORGIA
30308, TELEPHONE: (404) 584-3794.
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<PAGE> 11
SUMMARY
The following summary is qualified in its entirety by, and should be
read in conjunction with, the more detailed information contained elsewhere in
this Prospectus or incorporated herein by reference.
AGL RESOURCES INC.
AGL Resources is a Georgia corporation incorporated on November 27,
1995, for the primary purpose of becoming the holding company for Atlanta Gas
Light Company ("AGLC"), a natural gas distribution utility, and its
subsidiaries. AGL Resources has its principal executive offices at 303 Peachtree
Street, N.E., Atlanta, Georgia 30308. References to the "AGL Companies" include
AGL Resources, AGLC, AGLC's wholly owned natural gas utility subsidiary,
Chattanooga Gas Company ("Chattanooga Gas"), and AGL Resources' nonregulated
subsidiaries: AGL Energy Services, Inc.; AGL Investments, Inc.; AGL Resources
Service Company; and The Energy Spring, Inc. AGL Energy Services, Inc. has one
nonregulated subsidiary, Georgia Gas Company. AGL Investments, Inc. has seven
nonregulated subsidiaries: AGL Propane, Inc.; Georgia Energy Company; AGL Energy
Wise Services, Inc.; AGL Consumer Services, Inc.; AGL Gas Marketing, Inc.; AGL
Power Services, Inc.; and Trustees Investments, Inc.
AGL Resources' principal business is the distribution of natural gas to
customers in central, northwest, northeast, and southeast Georgia and the
Chattanooga, Tennessee area through its natural gas distribution subsidiary,
AGLC. AGLC's major service area is the ten county metropolitan Atlanta area.
AGLC's other principal service areas in Georgia are the Athens, Augusta,
Brunswick, Macon, Rome, Savannah, and Valdosta areas. In addition to AGLC's
service areas in Georgia, natural gas service is supplied by Chattanooga Gas in
Chattanooga and Cleveland, Tennessee, and surrounding portions of Hamilton
County and Bradley County, Tennessee. All of AGLC's and Chattanooga Gas' natural
gas service area is certificated by the Georgia Public Service Commission and
the Tennessee Regulatory Authority, formerly the Tennessee Public Service
Commission.
AGL CAPITAL TRUST
The Trust is a statutory business trust formed under Delaware law
pursuant to (i) a Declaration of Trust executed by AGL Resources, as Sponsor,
and The Bank of New York (Delaware), as Delaware Trustee, and thereafter amended
and restated in the form of the Declaration of Trust to add the other Trustees
and governing language for the Trust and (ii) the filing of a Certificate of
Trust with the Delaware Secretary of State on June 6, 1997. The Trust's business
and affairs are conducted by the following Trustees: The Bank of New York, as
the Property Trustee, The Bank of New York (Delaware), as the Delaware Trustee,
and three individual Administrative Trustees who are employees or officers of or
affiliated with AGL Resources. The Trust exists for the exclusive purposes of
(i) issuing and selling the Trust Securities, (ii) using the proceeds from the
sale of the Trust Securities to acquire the Junior Subordinated Debentures
issued by AGL Resources, and (iii) except as otherwise limited by the
Declaration of Trust engaging in only those other activities necessary,
advisable, or incidental thereto. Accordingly, the Junior Subordinated
Debentures are the sole assets of the Trust, and payments under the Junior
Subordinated Debentures are the sole revenue of the Trust.
THE EXCHANGE OFFER
The Exchange Offer........ Up to 75,000 Exchange Capital Securities are being
offered in exchange for a like number of Original
Capital Securities. Original Capital Securities may
be tendered for exchange in whole or in part in a
Liquidation Amount of $100,000 (100 Capital
Securities) or any integral multiple of $1,000 (one
Original Capital Security) in excess thereof. AGL
Resources and the Trust are making the Exchange Offer
in order to satisfy their obligations under the
Registration Rights Agreement relating to the
Original Capital Securities. For a description of the
procedures for tendering Original Capital Securities,
see "The Exchange Offer--Procedures for Tendering
Original Capital Securities."
8
<PAGE> 12
Expiration Date........................ 5:00 p.m., New York City time, on
________________ , 1997, unless the
Exchange Offer is extended by AGL
Resources or the Trust (in which
case the Expiration Date will be the
latest date and time to which the
Exchange Offer is extended). See
"The Exchange Offer--Terms of the
Exchange Offer."
Conditions to the Exchange Offer...... The Exchange Offer is subject to
certain conditions, which may be
waived by AGL Resources and the
Trust in their sole discretion. The
Exchange Offer is not conditioned
upon any minimum number of Original
Capital Securities being tendered.
See "The Exchange Offer--Conditions
to the Exchange Offer."
AGL Resources and the Trust reserve
the right in their sole and absolute
discretion, subject to applicable
law, at any time and from time to
time, (i) to delay the acceptance of
the Original Capital Securities for
exchange, (ii) to terminate the
Exchange Offer if certain specified
conditions have not been satisfied,
(iii) to extend the Expiration Date
of the Exchange Offer and retain all
Original Capital Securities tendered
pursuant to the Exchange Offer,
subject, however, to the right of
holders of Original Capital
Securities to withdraw their
tendered Original Capital
Securities, or (iv) to waive any
condition or otherwise amend the
terms of the Exchange Offer in any
respect. See "The Exchange
Offer--Terms of the Exchange Offer."
Withdrawal Rights...................... Tenders of Original Capital
Securities may be withdrawn at any
time on or prior to the Expiration
Date by delivering a written notice
of such withdrawal to the Exchange
Agent in conformity with certain
procedures set forth below under
"The Exchange Offer--Withdrawal
Rights."
Procedures for Tendering
Original Capital
Securities............................ Tendering holders of Original
Capital Securities must complete and
sign a Letter of Transmittal in
accordance with the instructions
contained therein and forward the
same by mail, facsimile, or hand
delivery, together with any other
required documents, to the Exchange
Agent, either with the Original
Capital Securities to be tendered or
in compliance with the specified
procedures for guaranteed delivery
of Original Capital Securities.
Certain brokers, dealers, commercial
banks, trust companies, and other
nominees may also effect tenders by
book-entry transfer. Holders of
Original Capital Securities
registered in the name of a broker,
dealer, commercial bank, trust
company, or other nominee are urged
to contact such Person promptly if
they wish to tender Original Capital
Securities pursuant to the Exchange
Offer. See "The Exchange
Offer--Procedures for Tendering
Original Capital Securities."
Letters of Transmittal and
certificates representing Original
Capital Securities should not be
sent to AGL Resources or the Trust.
Such documents should only be sent
to the Exchange Agent at the address
set forth in the Letter of
Transmittal.
9
<PAGE> 13
Resales of Exchange Capital
Securities.................... AGL Resources and the Trust are making the
Exchange Offer in reliance on the position of
the staff of the Division of Corporation Finance
of the Commission as set forth in certain
interpretive letters addressed to third parties
in other transactions. However, neither AGL
Resources nor the Trust has sought its own
interpretive letter and there can be no
assurance that the staff of the Division of
Corporation Finance of the Commission would make
a similar determination with respect to the
Exchange Offer as it has in such interpretive
letters to third parties. Based on these
interpretations by the staff of the Division of
Corporation Finance of the Commission, and
subject to the two immediately following
sentences, AGL Resources and the Trust believe
that Exchange Capital Securities issued pursuant
to this Exchange Offer in exchange for Original
Capital Securities may be offered for resale,
resold, and otherwise transferred by a holder
thereof (other than a holder who is a
broker-dealer) without further compliance with
the registration and prospectus delivery
requirements of the Securities Act, provided
that such Exchange Capital Securities are
acquired in the ordinary course of such holder's
business and that such holder is not
participating, and has no arrangement or
understanding with any Person to participate, in
a distribution (within the meaning of the
Securities Act) of such Exchange Capital
Securities. However, any holder of Original
Capital Securities who is an "affiliate" of AGL
Resources or the Trust or who intends to
participate in the Exchange Offer for the
purpose of distributing the Exchange Capital
Securities, or any broker-dealer who purchased
the Original Capital Securities from the Trust
to resell pursuant to Rule 144A or any other
available exemption under the Securities Act,
(a) will not be able to rely on the
interpretations of the staff of the Division of
Corporation Finance of the Commission set forth
in the above-mentioned interpretive letters, (b)
will not be permitted or entitled to tender such
Original Capital Securities in the Exchange
Offer, and (c) must comply with the registration
and prospectus delivery requirements of the
Securities Act in connection with any sale or
other transfer of such Original Capital
Securities unless such sale is made pursuant to
an exemption from such requirements. In
addition, as described below, if any
broker-dealer holds Original Capital Securities
acquired for its own account as a result of
market-making or other trading activities and
exchanges such Original Capital Securities for
Exchange Capital Securities, then such
broker-dealer must deliver a prospectus meeting
the requirements of the Securities Act in
connection with any resales of such Exchange
Capital Securities.
Each holder of Original Capital Securities who
wishes to exchange Original Capital Securities
for Exchange Capital Securities in the Exchange
Offer will be required to represent that (i) it
is not an "affiliate" of AGL Resources or the
Trust, (ii) any Exchange Capital Securities to
be received by it are being acquired in the
ordinary course of its business, (iii) it has no
arrangement or understanding with any Person to
participate in a distribution (within the
meaning of the Securities Act) of such Exchange
Capital Securities, and (iv) if such holder is
not a broker-dealer, such holder is not engaged
in, and does not intend to engage in, a
distribution (within the meaning of the
Securities Act) of such Exchange Capital
Securities. Each broker-dealer that receives
Exchange Capital Securities
10
<PAGE> 14
for its own account in exchange for Original
Capital Securities, where such Original Capital
Securities were acquired by such broker-dealer
as a result of market-making activities or other
trading activities, must acknowledge that it
will deliver a prospectus in connection with any
resale of such Exchange Capital Securities. See
"Plan of Distribution". The Letter of
Transmittal states that, by so acknowledging and
by delivering a prospectus, a broker-dealer will
not be deemed to admit that it is an
"underwriter" within the meaning of the
Securities Act. Based on the position taken by
the staff of the Division of Corporation Finance
of the Commission in the interpretive letters
referred to above, AGL Resources and the Trust
believe that Participating Broker-Dealers who
acquired Original Capital Securities for their
own accounts as a result of market-making
activities or other trading activities may
fulfill their prospectus delivery requirements
with respect to the Exchange Capital Securities
received upon exchange of such Original Capital
Securities (other than Original Capital
Securities which represent an unsold allotment
from the initial sale of the Original Capital
Securities) with a prospectus meeting the
requirements of the Securities Act, which may be
the prospectus prepared for an exchange offer so
long as it contains a description of the plan of
distribution with respect to the resale of such
Exchange Capital Securities. Accordingly, this
Prospectus, as it may be amended or supplemented
from time to time, may be used by a
Participating Broker-Dealer in connection with
resales of Exchange Capital Securities received
in exchange for Original Capital Securities
where such Original Capital Securities were
acquired by such Participating Broker-Dealer for
its own account as a result of market-making or
other trading activities. Subject to certain
provisions set forth in the Registration Rights
Agreement and to the limitations described below
under "The Exchange Offer--Resales of Exchange
Capital Securities," AGL Resources and the Trust
have agreed that this Prospectus, as it may be
amended or supplemented from time to time, may
be used by a Participating Broker-Dealer in
connection with resales of such Exchange Capital
Securities for a period ending 180 days after
the Expiration Date (subject to extension under
certain limited circumstances) or, if earlier,
when all such Exchange Capital Securities have
been disposed of by such Participating
Broker-Dealer. See "Plan of Distribution." Any
Participating Broker-Dealer who is an
"affiliate" of AGL Resources or the Trust may
not rely on such interpretive letters and must
comply with the registration and prospectus
delivery requirements of the Securities Act in
connection with any resale transaction. See "The
Exchange Offer--Resales of Exchange Capital
Securities."
Exchange Agent............... The exchange agent with respect to the
Exchange Offer is The Bank of New York (the
"Exchange Agent"). The addresses and telephone
and facsimile numbers of the Exchange Agent are
set forth in "The Exchange Offer--Exchange
Agent" and in the Letter of Transmittal.
Use of Proceeds............ Neither AGL Resources nor the Trust will
receive any cash proceeds from the issuance of
the Exchange Capital Securities offered hereby.
See "Use of Proceeds."
11
<PAGE> 15
Certain United States
Federal Income Tax
Consequences; ERISA
Considerations........................ Holders of Original Capital
Securities should review the
information set forth under "Certain
United States Federal Income Tax
Consequences" and "ERISA
Considerations" prior to tendering
Original Capital Securities in
the Exchange Offer.
THE EXCHANGE CAPITAL SECURITIES
Securities Offered..................... Up to 75,000 of the Trust's Exchange
Capital Securities which have been
registered under the Securities Act
(Liquidation Amount $1,000 per
Exchange Capital Security). The
Exchange Capital Securities will be
issued, and the Original Capital
Securities were issued, under the
Declaration of Trust. The Exchange
Capital Securities and any Original
Capital Securities which remain
outstanding after consummation of
the Exchange Offer will vote
together as a single class for
purposes of determining whether
holders of the requisite percentage
in outstanding Liquidation Amount
thereof have taken certain actions
or exercised certain rights under
the Declaration of Trust. See
"Description of Exchange Capital
Securities--Voting Rights; Amendment
of the Declaration of Trust." The
terms of the Exchange Capital
Securities are identical in all
material respects to the terms of
the Original Capital Securities,
except that the Exchange Capital
Securities have been registered
under the Securities Act and will
not be subject to certain
restrictions on transfer applicable
to the Original Capital Securities
and will not provide for any
increase in the Distribution Rate
thereon. See "The Exchange
Offer--Purpose of the Exchange
Offer" and "Description of Exchange
Capital Securities."
Maturity Date.......................... June 1, 2037. The Exchange Capital
Securities are mandatorily
redeemable upon earlier redemption
of the Exchange Junior Subordinated
Debentures.
Distribution Dates..................... June 1 and December 1 of each year,
commencing December 1, 1997.
Extension Periods...................... So long as no Debenture Event of
Default has occurred and is
continuing, Distributions on
Exchange Capital Securities will be
deferred for the duration of any
Extension Period elected by AGL
Resources with respect to the
payment of interest on the Exchange
Junior Subordinated Debentures. No
Extension Period will exceed 10
consecutive semi-annual periods or
extend beyond the Stated Maturity
Date. If interest payments are so
deferred, AGL Resources will not be
permitted, subject to certain
exceptions described herein, to
declare or pay any dividend or
distribution on any of its capital
stock or make any guarantee payments
with respect to the foregoing, or
make any payment on any debt
securities that rank pari passu with
or junior to the Junior Subordinated
Debentures. See "Description of
Exchange Junior Subordinated
Debentures--Option to Extend
Interest Payment Date" and "Certain
Federal Income Tax
Consequences--Interest Income and
Original Issue Discount."
Ranking................................ The Exchange Capital Securities will
rank pari passu, and payments
thereon will be made pro rata, with
the Original Capital Securities and
the
12
<PAGE> 16
Common Securities except as described under
"Description of Exchange Capital
Securities--Subordination of Common Securities."
The Exchange Junior Subordinated Debentures will
rank pari passu with the Original Junior
Subordinated Debentures and all other junior
subordinated debentures to be issued by AGL
Resources ("Other Debentures"), which will be
issued and sold (if at all) to other trusts to
be established by AGL Resources (if any), in
each case similar to the Trust ("Other Trusts"),
and will be unsecured and subordinate and junior
in right of payment to all Senior Indebtedness
to the extent and in the manner set forth in the
Indenture. See "Description of Exchange Junior
Subordinated Debentures." The Exchange Guarantee
will rank pari passu with the Original Guarantee
and all other guarantees (if any) to be issued
by AGL Resources with respect to capital or
preferred securities (if any) issued by Other
Trusts ("Other Guarantees") and will constitute
an unsecured obligation of AGL Resources and
will rank subordinate and junior in right of
payment to all Senior Indebtedness to the extent
and in the manner set forth in the Exchange
Guarantee. See "Description of Exchange
Guarantee."
Redemption................ The Trust Securities will be subject to
mandatory redemption in a Like Amount, (i) in
whole but not in part, on the Stated Maturity
Date upon repayment of the Junior Subordinated
Debentures, (ii) in whole but not in part, at
any time prior to June 1, 2007,
contemporaneously with the optional prepayment
of the Junior Subordinated Debentures by AGL
Resources upon the occurrence and continuation
of a Tax Event or an Investment Company Act
Event and (iii) in whole or in part, on or after
June 1, 2007, contemporaneously with the
optional prepayment by AGL Resources of the
Junior Subordinated Debentures, in each case at
the applicable Redemption Price. See
"Description of Exchange Securities--Description
of Exchange Capital Securities--Redemption."
Guarantee.................... AGL Resources has, through the Exchange
Guarantee, the Indenture, the Exchange Junior
Subordinated Debentures and the Declaration of
Trust, fully and unconditionally guaranteed,
subject to certain subordination provisions, all
of the Trust's obligations with respect to the
Exchange Capital Securities. The payment of
Distributions on the Exchange Capital Securities
is guaranteed by AGL Resources under the
Exchange Guarantee, but only to the extent that
the Trust has funds legally and immediately
available therefor. If AGL Resources fails to
make required payments on the Exchange Junior
Subordinated Debentures, the Trust will not have
sufficient funds to pay such Distributions, and
the Exchange Guarantee does not cover the
payment of Distributions when the Trust does not
have sufficient funds legally available
therefor. In such event, the remedy of a holder
of Exchange Capital Securities is to enforce the
Exchange Junior Subordinated Debentures in
accordance with applicable law. See "Description
of the Exchange Junior Subordinated Debentures."
AGL Resources' obligations under the Exchange
Guarantee are subordinate and junior in right of
payment to all of its other liabilities and will
rank pari passu with the most senior preferred
stock of AGL Resources which may be issued. See
"Description of the Exchange Guarantee."
13
<PAGE> 17
Distribution of Junior Subordinated
Debentures............................. AGL Resources will have the right at
any time to terminate the Trust and
cause a Like Amount of the Exchange
Junior Subordinated Debentures to be
distributed to the holders of the
Exchange Capital Securities in
liquidation of the Trust, subject to
AGL Resources having received an
opinion of counsel to the effect
that such distribution will not be a
taxable event to holders of Capital
Securities. Unless the Exchange
Junior Subordinated Debentures are
distributed to the holders of the
Exchange Capital Securities, in the
event of a liquidation of the Trust
as described herein, after
satisfaction of liabilities to
creditors of the Trust as required
by applicable law, the holders of
the Exchange Capital Securities
generally will be entitled to
receive a Liquidation Amount of
$1,000 per Capital Security plus
accumulated Distributions thereon to
the date of payment. See
"Description of Exchange Capital
Securities--Liquidation of the Trust
and Distribution of Junior
Subordinated Debentures."
Transfer Restrictions.................. The Exchange Capital Securities will
be issued, and may be transferred,
only in minimum denominations of not
less than $1,000 (one Exchange
Capital Security). See "Description
of Exchange Capital Securities--
Restrictions on Transfer." Any such
transfer of Exchange Capital
Securities in denominations of less
than $1,000 shall be deemed to be
void and of no legal effect
whatsoever.
Absence of Market for the
Capital Securities.................... The Exchange Capital Securities will
be a new issue of securities for
which there currently is no market.
Although the Initial Purchasers have
informed the Trust and AGL Resources
that they each currently intend to
make a market in the Capital
Securities, the Initial Purchasers
are not obligated to do so, and any
such market making may be
discontinued at any time without
notice. Accordingly, there can be no
assurance as to the development or
liquidity of any market for the
Capital Securities. The Trust and
AGL Resources do not intend to apply
for listing of the Capital
Securities on any securities
exchange or for quotation through
the NASD Automated Quotation System.
See "Plan of Distribution."
14
<PAGE> 18
RISK FACTORS
Prospective investors should carefully review the following information
in addition to the information contained elsewhere in this Prospectus. This
Prospectus contains certain forward-looking statements and information relating
to AGL Resources that are based on the beliefs of management of AGL Resources as
well as assumptions made by and information currently available to management.
The words "anticipate," "believe," "estimate," "expect," "intends," and similar
expressions as they relate to AGL Resources or AGL Resources' management, are
intended to identify forward-looking statements. Such statements reflect the
current views of AGL Resources with respect to future events and are subject to
certain risks, uncertainties, and assumptions, including the risk factors
described in this Prospectus. Should one or more of these risks or uncertainties
materialize, or should underlying assumptions prove incorrect, actual results
may vary materially from those described herein as anticipated, believed,
estimated or expected. AGL Resources does not intend to update these
forward-looking statements.
RANKING OF SUBORDINATED OBLIGATIONS UNDER THE GUARANTEE AND THE JUNIOR
SUBORDINATED DEBENTURES; HOLDING COMPANY STRUCTURE
The obligations of AGL Resources under the Guarantee issued by it for
the benefit of the holders of Capital Securities, as well as under the Junior
Subordinated Debentures, will be unsecured and rank subordinate and junior in
right of payment to all Senior Indebtedness. In addition, in the case of a
bankruptcy or insolvency proceeding, AGL Resources' obligations under the
Guarantee will also rank subordinate and junior in right of payment to all
liabilities (other than Other Guarantees) of AGL Resources. At June 30, 1997,
AGL Resources had no Senior Indebtedness outstanding. Because AGL Resources is a
holding company, the right of AGL Resources to participate in any distribution
of assets of any subsidiary upon such subsidiary's liquidation or reorganization
or otherwise (and thus the ability of holders of the Capital Securities to
benefit indirectly from such distribution) is subject to the prior claims of
creditors of that subsidiary, except to the extent that AGL Resources may itself
be recognized as a creditor of that subsidiary. At June 30, 1997, the
subsidiaries of AGL Resources had total liabilities (excluding liabilities owed
to AGL Resources) of approximately $319.8 million. Accordingly, the Junior
Subordinated Debentures will be effectively subordinated to all existing and
future liabilities of AGL Resources' subsidiaries. None of the Indenture, the
Guarantee or the Declaration of Trust places any limitation on the amount of
secured or unsecured debt, including Senior Indebtedness, that may be incurred
by AGL Resources or by any subsidiary. The principal sources of AGL Resources'
income are dividends and fees from its subsidiaries. Subject to the preferential
rights of the holders of the preferred stock of AGLC (and AGLC Junior Stock as
defined below (if any) ranking as to dividends ahead of the common stock of
AGLC) to receive full cumulative dividends, both past and current, and the
restrictions set forth below, AGL Resources, as the holder of all of the
outstanding shares of the common stock of AGLC, is entitled to receive such
dividends as may be declared by the Board of Directors of AGLC out of funds
legally available therefor. AGLC's Articles of Incorporation impose restrictions
on the payment of dividends (except a dividend in common stock of AGLC or in any
class of stock ranking junior to the preferred stock of AGLC as to dividends or
assets (the "AGLC Junior Stock")) unless AGLC attains certain earnings levels or
maintains certain capitalization ratios. Under the most restrictive of these
provisions, all of AGLC's retained earnings were free of such restrictions and
available for the payment of dividends at June 30, 1997. Retained earnings of
AGLC at June 30, 1997 were $86.0 million. See "Description of Exchange
Guarantee--Status of the Exchange Guarantee" and "Description of Exchange Junior
Subordinated Debentures--General" and "--Subordination."
The ability of the Trust to pay amounts due on the Capital Securities
is solely dependent upon AGL Resources making payments on the Junior
Subordinated Debentures as and when required.
OPTION TO EXTEND INTEREST PAYMENT PERIOD; TAX AND MARKET CONSIDERATIONS
So long as no Debenture Event of Default shall have occurred and be
continuing, AGL Resources will have the right under the Indenture to defer
payments of interest on the Junior Subordinated Debentures at any time or from
time to time for a period not exceeding 10 consecutive semi-annual periods with
respect to each Extension Period, provided that no Extension Period may extend
beyond the Stated Maturity Date. As a consequence of any such deferral,
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<PAGE> 19
semi-annual Distributions on the Capital Securities by the Trust will be
deferred (and the amount of Distributions to which holders of the Capital
Securities are entitled will accumulate additional Distributions thereon at the
rate of 8.17% per annum, compounded semi-annually), from the relevant payment
date for such Distributions during any such Extension Period.
Prior to the termination of any such Extension Period, AGL Resources
may further extend such Extension Period, provided that such extension does not
cause such Extension Period to exceed 10 consecutive semi-annual periods or to
extend beyond the Stated Maturity Date. Upon the termination of any Extension
Period and the payment of all interest then accrued and unpaid on the Junior
Subordinated Debentures (together with interest thereon at the annual rate of
8.17%, compounded semi-annually, to the extent permitted by applicable law), AGL
Resources may elect to begin a new Extension Period, subject to the above
requirements. There is no limitation on the number of times that AGL Resources
may elect to begin an Extension Period. See "Description of Exchange Capital
Securities--Distributions" and "Description of Exchange Junior Subordinated
Debentures--Option to Extend Interest Payment Date."
AGL Resources has no current intention to exercise its right to defer
payments of interest on the Junior Subordinated Debentures. Should, however, AGL
Resources exercise its right to defer payments of interest on the Junior
Subordinated Debentures, each holder of Trust Securities will be required to
accrue income(as OID) in respect of the deferred stated interest allocable to
its Trust Securities for United States federal income tax purposes, which will
be allocated but not distributed to holders of Trust Securities. As a result,
each such holder of Capital Securities will recognize income for United States
federal income tax purposes in advance of the receipt of cash and will not
receive the cash related to such income from the Trust if the holder disposes of
the Capital Securities prior to the record date for the payment of Distributions
thereafter. See "Certain Federal Income Tax Consequences-- Interest Income and
Original Issue Discount" and "--Sales of Capital Securities."
Should AGL Resources elect to exercise its right to defer payments of
interest on the Junior Subordinated Debentures in the future, the market price
of the Capital Securities is likely to be affected. A holder that disposes of
its Capital Securities during an Extension Period, therefore, might not receive
the same return on its investment as a holder that continues to hold its Capital
Securities. In addition, merely as a result of the existence of AGL Resources'
right to defer payments of interest on the Junior Subordinated Debentures, the
market price of the Capital Securities may be more volatile than the market
prices of other securities that are not subject to such deferrals.
SPECIAL EVENT REDEMPTION; POSSIBLE TAX LAW CHANGES AFFECTING THE CAPITAL
SECURITIES
Upon the occurrence and continuation of a Tax Event or an Investment
Company Act Event (each as defined under "Description of Exchange Junior
Subordinated Debentures--Special Event Prepayment"), AGL Resources will have the
right to prepay the Junior Subordinated Debentures in whole (but not in part) at
the Special Event Prepayment Price prior to June 1, 2007 and within 90 days
following the occurrence of such Tax Event or Investment Company Act Event and
therefore cause a mandatory redemption of the Trust Securities at the Special
Event Redemption Price.
See "Description of Exchange Capital Securities--Redemption."
On March 19, 1996, President Clinton proposed certain tax law changes
that would, among other things, generally deny corporate issuers a deduction
for interest in respect of certain debt obligations issued on or after December
7, 1995 (the "1996 Proposed Legislation") if such debt obligations have (i) a
weighted average maturity in excess of 40 years, or (ii) a maximum term in
excess of 20 years and are not shown as indebtedness on the issuer's applicable
consolidated balance sheet. Neither the 1996 Proposed Legislation nor similar
legislation was enacted during the 104th Congress. On February 6, 1997,
President Clinton proposed in the administration's fiscal year 1998 budget
certain new tax changes (the "1997 Proposed Legislation") that would, among
other things, generally deny corporate issuers a deduction for interest or OID
in respect of certain debt obligations if such debt obligations have a maximum
term in excess of 15 years and are not shown as indebtedness on the issuer's
applicable consolidated balance sheet. On August 5, 1997, President Clinton
signed the Taxpayer Relief Act of 1997, which enacted into law certain
provisions of the 1997 Proposed Legislation. The Taxpayer Relief Act of 1997
does not contain any provision that would affect AGL Resources' ability to
deduct interest payable on the Junior Subordinated Debentures.
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<PAGE> 20
However, there can be no assurance that other legislation enacted after the
date hereof will not adversely affect the ability of AGL Resources to deduct
the interest payable on the Junior Subordinated Debentures. There can be no
assurance, therefore, that a Tax Event will not occur. A Tax Event would permit
AGL Resources to cause a redemption of the Capital Securities before June 1,
2007.
TAX AND MARKET RISKS OF REDEMPTION OR EXCHANGE OF CAPITAL SECURITIES FOR JUNIOR
SUBORDINATED DEBENTURES
AGL Resources has the right at any time to dissolve, wind-up, or
terminate the Trust and cause the Junior Subordinated Debentures to be
distributed to the holders of the Trust Securities in exchange therefor in
liquidation of the Trust. AGL Resources will have the right, in certain
circumstances, to redeem the Junior Subordinated Debentures, in whole or in
part, in lieu of a distribution of the Junior Subordinated Debentures by the
Trust, in which event the Trust will redeem the Trust Securities on a pro rata
basis to the same extent as the Junior Subordinated Debentures are redeemed by
AGL Resources.
Under current United States federal income tax law, a distribution of
Junior Subordinated Debentures upon the dissolution of the Trust would not be a
taxable event to holders of the Capital Securities. If, however, the Trust is
characterized as an association taxable as a corporation at the time of the
dissolution of the Trust, the distribution of the Junior Subordinated Debentures
may constitute a taxable event to holders of Capital Securities. Moreover, upon
the occurrence of a Tax Event, a dissolution of the Trust in which holders of
the Capital Securities receive cash may be a taxable event to such holders. See
"Certain Federal Income Tax Consequences--Receipt of Junior Subordinated
Debentures or Cash Upon Liquidation of the Trust."
There can be no assurance as to the market prices for Capital
Securities or Junior Subordinated Debentures distributed to the holders of
Capital Securities if a termination of the Trust were to occur. Accordingly, the
Capital Securities or the Junior Subordinated Debentures may trade at a discount
from the price that the investor paid to purchase the Capital Securities.
Because holders of Capital Securities may receive Junior Subordinated Debentures
in liquidation of the Trust and because Distributions are otherwise limited to
payments on the Junior Subordinated Debentures, prospective purchasers of
Capital Securities are also making an investment decision with regard to the
Junior Subordinated Debentures and should carefully review all the information
regarding the Junior Subordinated Debentures contained herein. See "Description
of Exchange Junior Subordinated Debentures."
RIGHTS UNDER THE GUARANTEE
The Bank of New York will act as Guarantee Trustee and will hold the
Guarantee for the benefit of the holders of the Capital Securities. The Bank of
New York will also act as Property Trustee under the Declaration of Trust and as
Indenture Trustee under the Indenture. The Bank of New York (Delaware) will act
as Delaware Trustee under the Declaration of Trust. The Guarantee will guarantee
to the holders of the Capital Securities the following payments, to the extent
not paid by the Trust: (i) any accumulated and unpaid Distributions required to
be paid on the Capital Securities, to the extent that the Trust has funds on
hand legally and immediately available therefor, (ii) the applicable Redemption
Price with respect to any Capital Securities called for redemption, to the
extent that the Trust has funds on hand legally and immediately available
therefor, and (iii) upon a voluntary or involuntary termination and liquidation
of the Trust (unless the Junior Subordinated Debentures are distributed to
holders of the Capital Securities), the lesser of (a) the aggregate of the
Liquidation Amount and all accumulated and unpaid Distributions to the date of
payment, to the extent that the Trust has funds on hand legally and immediately
available therefor and (b) the amount of assets of the Trust remaining available
for distribution to holders of the Capital Securities upon a termination and
liquidation of the Trust (collectively, the "Guarantee Payments"). If an event
of default under the Guarantee has occurred and is continuing, no Guarantee
Payments under the Common Securities Guarantee may be made until the holders of
the Capital Securities shall be paid the Guarantee Payments in full. The holders
of a majority in Liquidation Amount of the Capital Securities will have the
right to direct the time, method, and place of conducting any proceeding for any
remedy available to the Guarantee Trustee in respect of the Guarantee or to
direct the exercise of any trust power conferred upon the Guarantee Trustee. Any
holder of the Capital Securities may institute a legal proceeding directly
17
<PAGE> 21
against AGL Resources to enforce its rights under the Guarantee without first
instituting a legal proceeding against the Trust, the Guarantee Trustee or any
other Person or entity. If AGL Resources defaults on its obligation to pay
amounts payable under the Junior Subordinated Debentures, the Trust will not
have sufficient funds for the payment of Distributions or amounts payable on
redemption of the Capital Securities or otherwise, and, in such event, holders
of the Capital Securities will not be able to rely upon the Guarantee for
payment of such amounts. Instead, in the event a Debenture Event of Default
shall have occurred and be continuing and such event is attributable to the
failure of AGL Resources to pay principal of (or premium, if any) or interest on
the Junior Subordinated Debentures on the payment date on which such payment is
due and payable, then a holder of Capital Securities may institute a legal
proceeding directly against AGL Resources for enforcement of payment to such
holder of the principal of (or premium, if any) or interest on such Junior
Subordinated Debentures having a principal amount equal to the Liquidation
Amount of the Capital Securities of such holder (a "Direct Action").
Notwithstanding any payments made to a holder of Capital Securities by AGL
Resources in connection with a Direct Action, AGL Resources shall remain
obligated to pay the principal of (and premium, if any) and interest on the
Junior Subordinated Debentures, and AGL Resources shall be subrogated to the
rights of the holder of such Capital Securities with respect to payments on the
Capital Securities to the extent of any payments made by AGL Resources to such
holder in any Direct Action. Except as described herein, holders of Capital
Securities will not be able to exercise directly any other remedy available to
the holders of the Junior Subordinated Debentures or to assert directly any
other rights in respect of the Junior Subordinated Debentures. See "Description
of Exchange Junior Subordinated Debentures--Enforcement of Certain Rights by
Holders of Capital Securities," "Description of Exchange Junior Subordinated
Debentures--Debenture Events of Default," and "Description of Exchange
Guarantee." The Declaration of Trust provides that each holder of Capital
Securities by acceptance thereof agrees to the provisions of the Indenture.
LIMITED VOTING RIGHTS
Holders of Capital Securities generally have limited voting rights
relating only to the modification of the Capital Securities, the termination or
liquidation of the Trust, and the exercise of the Trust's rights as holder of
Junior Subordinated Debentures. Holders of Capital Securities are not entitled
to vote to appoint, remove, or replace the Property Trustee or the Delaware
Trustee, and such voting rights are vested exclusively in the holder of the
Common Securities except upon the occurrence of certain events described herein.
Holders of Capital Securities are not entitled to appoint, remove or replace
Administrative Trustees as such right is vested exclusively in the holder(s) of
the Common Securities. See "Description of Exchange Capital Securities--Voting
Rights; Amendment of the Declaration of Trust" and "--Removal of Trustees."
CONSEQUENCES OF A FAILURE TO EXCHANGE ORIGINAL CAPITAL SECURITIES
The Original Capital Securities have not been registered under the
Securities Act or any state securities laws and therefore may not be offered,
sold, or otherwise transferred except in compliance with the registration
requirements of the Securities Act and any other applicable securities laws, or
pursuant to an exemption therefrom or in a transaction not subject thereto, and
in each case in compliance with certain other conditions and restrictions.
Original Capital Securities which remain outstanding after consummation of the
Exchange Offer will continue to bear a legend reflecting such restrictions on
transfer. In addition, upon consummation of the Exchange Offer, holders of
Original Capital Securities which remain outstanding will not be entitled to any
rights to have such Original Capital Securities registered under the Securities
Act or to any similar rights under the Registration Rights Agreement (subject to
certain limited exceptions). AGL Resources and the Trust do not intend to
register under the Securities Act any Original Capital Securities which remain
outstanding after consummation of the Exchange Offer (subject to such limited
exceptions, if applicable). To the extent that Original Capital Securities are
tendered and accepted in the Exchange Offer, a holder's ability to sell
untendered Original Capital Securities could be adversely affected.
The Exchange Capital Securities and any Original Capital Securities
that remain outstanding after consummation of the Exchange Offer will vote
together as a single class for purposes of determining whether holders of the
requisite percentage in outstanding Liquidation Amount thereof have taken
certain actions or exercised certain
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<PAGE> 22
rights under the Declaration of Trust. See "Description of Exchange Capital
Securities--Voting Rights; Amendment of the Declaration of Trust."
The Original Capital Securities provide, among other things, that, if a
registration statement relating to the Exchange Offer has not been filed by
November 8, 1997 and declared effective by December 28, 1997, the Distribution
Rate borne by the Original Capital Securities will increase by 0.25% per annum
until such registration statement has been filed or declared effective, as the
case may be. Upon consummation of the Exchange Offer, holders of Original
Capital Securities will not be entitled to any increase in the Distribution Rate
thereon or any further registration rights under the Registration Rights
Agreement, except under limited circumstances. See "Description of Original
Securities."
ABSENCE OF PUBLIC MARKET
The Original Capital Securities were issued to, and AGL Resources
believes such securities are currently owned by, a relatively small number of
beneficial owners. The Original Capital Securities have not been registered
under the Securities Act and will be subject to transfer restrictions (including
a limitation on transfer to only blocks having a Liquidation Amount of not less
than $100,000 (100 Capital Securities)) if they are not exchanged for the
Exchange Capital Securities. Although the Exchange Capital Securities may be
resold or otherwise transferred by the holders (who are not affiliates of AGL
Resources or the Trust) without compliance with the registration requirements
under the Securities Act, there is no existing market for the Exchange Capital
Securities and there can be no assurance as to the liquidity of any markets that
may develop for the Exchange Capital Securities, the ability of the holders to
sell their Exchange Capital Securities or at what price holders of the Exchange
Capital Securities will be able to sell their Exchange Capital Securities.
Future trading prices of the Exchange Capital Securities will depend on many
factors including, among other things, prevailing interest rates, AGL Resources'
operating results, and the market for similar securities. Depending on these and
other factors, the Exchange Capital Securities may trade at a discount. The
Initial Purchasers have informed the Trust and AGL Resources that the Initial
Purchasers intend to make a market in the Capital Securities. However, the
Initial Purchasers are not obligated to do so and any such market making
activity may be terminated at any time without notice to the holders of the
Capital Securities. If an active public market does not develop, the market
price and liquidity of the Exchange Capital Securities may be adversely
affected. In addition, such market making activity will be subject to the limits
of the Securities Act and may be limited during the pendency of the Exchange
Offer Registration Statement (as defined herein).
EXCHANGE OFFER PROCEDURES
Issuance of the Exchange Capital Securities in exchange for Original
Capital Securities pursuant to the Exchange Offer will be made only after a
timely receipt by the Exchange Agent of such Original Capital Securities, a
properly completed and duly executed Letter of Transmittal and all other
required documents. Therefore, holders of the Original Capital Securities
desiring to tender such Original Capital Securities in exchange for Exchange
Capital Securities should allow sufficient time to ensure timely delivery.
Neither AGL Resources nor the Trust is under any duty to give notification of
defects or irregularities with respect to the tenders of Original Capital
Securities for exchange.
AGL RESOURCES INC.
GENERAL
AGL Resources is a Georgia corporation incorporated on November 27,
1995, for the primary purpose of becoming the holding company for AGLC, a
natural gas distribution utility, and its subsidiaries including AGLC's wholly
owned natural gas utility subsidiary, Chattanooga Gas, and AGL Resources'
nonregulated subsidiaries: AGL Energy Services, Inc.; AGL Investments, Inc.; AGL
Resources Service Company; and The Energy Spring, Inc. AGL Energy Services, Inc.
has one nonregulated subsidiary, Georgia Gas Company. AGL Investments, Inc. has
seven nonregulated subsidiaries: AGL Propane, Inc.; Georgia Energy Company; AGL
Energy Wise Services, Inc.; AGL
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<PAGE> 23
Consumer Services, Inc.; AGL Gas Marketing, Inc.; AGL Power Services, Inc.; and
Trustees Investments, Inc. Unless noted specifically or otherwise required by
the context, references to AGLC include the operations and activities of AGLC
and Chattanooga Gas.
AGL Resources' principal business is the distribution of natural gas to
customers in central, northwest, northeast and southeast Georgia and the
Chattanooga, Tennessee area through its natural gas distribution subsidiary,
AGLC. AGLC's major service area is the ten county metropolitan Atlanta area.
Metropolitan Atlanta has an estimated population of three million, constituting
approximately 40% of the total population of Georgia. Approximately 66% of
AGLC's customers are located in the Atlanta metropolitan area. These customers
consume 45% of the natural gas sold and transported and provide approximately
61% of the gas revenues of AGLC. AGLC's other principal service areas in Georgia
are the Athens, Augusta, Brunswick, Macon, Rome, Savannah and Valdosta areas.
During the twelve months ended June 30, 1997, AGLC supplied natural gas service
to an average of approximately 1.4 million customers in Georgia including 497
centrally metered customers serving 48,835 apartment units. AGLC provides
natural gas service in 235 cities and surrounding areas in Georgia. In addition
to AGLC's service areas in Georgia, natural gas service was supplied by
Chattanooga Gas to an average of approximately 53,200 customers in Chattanooga
and Cleveland, Tennessee, and surrounding portions of Hamilton County and
Bradley County, Tennessee during the twelve months ended June 30, 1997. All of
AGLC's natural gas service area is certificated by the Georgia Public Service
Commission ("Georgia Commission") and the Tennessee Regulatory Authority
("TRA"), formerly the Tennessee Public Service Commission.
During the twelve months ended June 30, 1997, AGLC added approximately
33,700 customers, based on 12- month average calculations, representing an
increase over the prior year of approximately 2.4%. Substantially all of this
growth was in the residential and small commercial service categories.
AGL Resources engages in nonregulated business activities through its
wholly owned subsidiaries, AGL Energy Services, Inc., a gas supply services
company; AGL Investments, Inc., a subsidiary established to develop and manage
certain nonregulated businesses; The Energy Spring, Inc., a retail energy
marketing company; and their subsidiaries.
The principal executive offices of AGL Resources are located at 303
Peachtree Street, N.E., Atlanta, Georgia 30308, and the telephone number is
(404) 584-9470.
AGL Resources' primary business of gas distribution through AGLC is
highly seasonal in nature and heavily dependent on weather because of the
substantial use of gas for heating purposes. However, the Georgia Commission and
the TRA have authorized the implementation of weather normalization adjustment
riders, which are designed to offset the impact that either unusually cold or
unusually warm weather has on operating margin, earnings and cash flow and are
designed to stabilize operating margin and earnings at the levels which would
occur with normal weather.
RECENT DEVELOPMENTS
The 1997 session of the Georgia General Assembly passed legislation
which provides a legal framework for comprehensive deregulation of many aspects
of the natural gas business in Georgia. Senate Bill 215, the Natural Gas
Competition and Deregulation Act, which became law on April 14, 1997, if
implemented by AGLC with respect to its system, would result in the application
of an alternative form of regulation, such as performance based regulation, to
AGLC. Pursuant to a separate election, AGLC, as an electing distribution
company, could choose to exit the merchant function and fully unbundle its
system.
Senate Bill 215 provides for a transition period leading to a condition
of effective competition in the natural gas markets. An electing distribution
company would unbundle all services to its natural gas customers, assign firm
delivery capacity to certificated marketers selling the gas commodity, and
create a secondary transportation market for interruptible transportation
capacity. Marketers, including unregulated affiliates of AGLC, would compete to
sell natural gas to all customers at market-based prices. AGLC would continue to
provide intrastate transportation of the gas to end
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<PAGE> 24
users through its existing system, subject to continued rate regulation by the
Georgia Commission. In addition, the Georgia Commission would continue to
regulate safety, access and quality of service pursuant to an alternative form
of regulation.
The law provides for marketer standards and rules of business practice
to ensure that the benefits of a competitive natural gas market are available to
all customers on the AGLC system. It imposes an obligation to serve on marketers
with a corresponding universal service fund which can also facilitate the
extension of AGLC facilities in order to serve the public interest.
In order to implement the new law, the Georgia Commission must
undertake and complete several rulemakings by December 31, 1997. As the process
of considering and adopting these rules progresses, the extent of and schedule
for actions under the legislation by AGLC will evolve further.
Currently, in accordance with Statement of Financial Accounting
Standard No. 71, "Accounting for the Effects of Certain types of Regulation,"
("SFAS 71"), AGLC has recorded regulatory assets and liabilities which represent
regulator-approved deferrals resulting from the ratemaking process. Recently,
the staff of the Commission has questioned the continued applicability of SFAS
71 to portions of the business of three California utilities, as a result of
legislation recently enacted in California. The Emerging Issues Task Force
("EITF") held discussions of this issue at its July 1997 meeting. The EITF
concluded that once legislation is passed to deregulate a segment of a utility
and that legislation includes sufficient detail for the enterprise to determine
how the transition plan will affect that segment, SFAS 71 should be discontinued
for that segment of the utility. The State of Georgia has enacted legislation
(Senate Bill 215) which allows deregulation of the merchant function and
unbundling of certain ancillary services of local gas distribution companies.
Each local gas company within the state may elect to be subject to Senate Bill
215 or continue to be regulated in the traditional manner. Under either
scenario, the rates to transport natural gas through the intrastate pipe system
of the local gas distribution company will be regulated by the Georgia
Commission. Since the activities associated with AGLC's SFAS 71 regulatory
assets and liabilities continue to be regulated, AGLC has concluded that the
continued application of SFAS 71 remains appropriate.
USE OF PROCEEDS
Neither AGL Resources nor the Trust will receive any cash proceeds from
the issuance of the Exchange Capital Securities and the Exchange Guarantee
offered hereby. In consideration for issuing the Exchange Capital Securities in
exchange for the Original Capital Securities as described in this Prospectus,
the Trust will receive Original Capital Securities in like Liquidation Amount.
The Original Capital Securities surrendered in exchange for the Exchange Capital
Securities will be retired and cancelled.
The gross proceeds to the Trust from the offering of the Original
Capital Securities, $75,000,000, were invested by the Trust in the Original
Junior Subordinated Debentures. AGL Resources used approximately $36 million of
the net proceeds from the sale of the Original Junior Subordinated Debentures to
reduce short-term debt and intends to use the balance for general corporate
purposes, which may include, but not be limited to, investments in and advances
to AGL Resources' subsidiaries and the redemption of AGLC's outstanding
preferred securities. The precise amount and timing of the application of such
net proceeds used for such corporate purposes will depend on the funding
requirements and the availability of other funds to AGL Resources and its
subsidiaries. Pending such application, AGL Resources has invested the balance
of the net proceeds in short-term interest bearing securities.
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<PAGE> 25
SUMMARY CONSOLIDATED FINANCIAL DATA
The summary below should be read in connection with the financial
information included in AGL Resources' 1996 Annual Report on Form 10-K and the
Quarterly Report on Form 10-Q for the quarter ended June 30, 1997. Unaudited
data for the twelve months ended June 30, 1997 reflects, in the opinion of
management of AGL Resources, all adjustments (consisting only of normal
recurring adjustments) necessary for a fair presentation of such data.
SUMMARY CONSOLIDATED FINANCIAL AND OPERATING INFORMATION
(DOLLARS IN MILLIONS EXCEPT FOR PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
TWELVE MONTHS YEAR ENDED SEPTEMBER 30,
ENDED JUNE 30, -------------------------------
1997 1996 1995 1994
---- ---- ---- ----
<S> <C> <C> <C> <C>
STATEMENT OF INCOME DATA:
Operating Revenues ..................... $1,267.3 $1,220.2 $ 1,063.0 $ 1,199.9
Operating Margin (1).................... 518.0 499.9 491.2 463.1
Dividends on Preferred Stock of
Majority Owned Subsidiaries .......... 4.8 4.4 4.4 4.5
Net Income ............................. 77.9 75.6 26.4 58.7
Earnings Per Share of Common Stock...... 1.40 1.37 0.50 1.17
Ratio of Earnings to Fixed Charges (2).. 3.02 3.08 1.75 2.66
BALANCE SHEET DATA (PERIOD END):
Total Assets ........................... $1,876.5 $1,824.7 $ 1,674.6 $ 1,642.9
Long-Term Obligations, including
current portion (3) .................. 640.3 610.3 610.3 625.3
OPERATING DATA:
Gas Sold and Transported (Therms in
millions):
Sold ................................. 1,812.7 2,153.2 1,896.8 1,906.8
Transported .......................... 934.9 738.7 722.8 697.4
-------- -------- --------- ---------
Total................................. 2,747.6 2,891.9 2,619.6 2,604.2
======== ======== ========= =========
Total Utility Customers (Average, in
thousands)............................ 1,418.6 1,394.5 1,353.0 1,315.7
</TABLE>
- ---------
(1) Operating revenues less cost of gas.
(2) The ratio of earnings to fixed charges in fiscal 1993 and 1992 was 2.49 and
2.54, respectively. The ratio of earnings to fixed charges was computed by
dividing the sum of income before income taxes plus fixed charges, by fixed
charges. Fixed charges consist of interest expense, amortization of debt
discount and deferred financing costs, capitalized interest, the estimated
interest component of rentals charged to income and preferred stock
dividends of majority owned subsidiaries, increased to an amount
representing the pre-tax earnings which would be required to cover such
preferred stock dividend requirements.
(3) On August 15, 1997, AGLC redeemed $14.3 million of its outstanding
preferred stock.
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<PAGE> 26
AGL CAPITAL TRUST
The Trust is a statutory business trust formed under Delaware law
pursuant to (i) the Declaration of Trust executed by AGL Resources, as Sponsor,
The Bank of New York (Delaware), as Delaware Trustee, The Bank of New York, as
Property Trustee, and the Administrative Trustees named therein, and (ii) the
filing of a Certificate of Trust with the Delaware Secretary of State on June 6,
1997. The Trust exists for the exclusive purposes of (i) issuing and selling the
Trust Securities, (ii) using the proceeds from the sale of Trust Securities to
acquire the Junior Subordinated Debentures, and (iii) except as otherwise
limited by the Declaration of Trust engaging in only those other activities
necessary, advisable, or incidental thereto. Accordingly, the Junior
Subordinated Debentures will be the sole assets of the Trust, and payments under
the Junior Subordinated Debentures will be the sole revenues of the Trust. All
of the Common Securities are owned by AGL Resources.
The Common Securities rank pari passu, and payments will be made
thereon pro rata, with the Capital Securities, except that upon the occurrence
and continuance of an event of default under the Declaration of Trust, the
rights of AGL Resources as holder of the Common Securities to payments in
respect of Distributions and payments upon liquidation, redemption or otherwise
will be subordinated to the rights of the holders of the Capital Securities. See
"Description of Exchange Capital Securities--Subordination of Common
Securities." AGL Resources has acquired Common Securities in a Liquidation
Amount equal to 3% of the total capital of the Trust. The Trust has a term of 40
years, but may terminate earlier as provided in the Declaration of Trust. The
Trust's business and affairs are conducted by the Trustees, each appointed by
AGL Resources as holder of the Common Securities.
The Trustees for the Trust are The Bank of New York, as the Property
Trustee, The Bank of New York (Delaware), as the Delaware Trustee, and three
individual trustees (the "Administrative Trustees") who are employees or
officers of or affiliated with AGL Resources (collectively, the "Trustees"). The
Bank of New York, as Property Trustee, acts as sole debenture trustee under the
Declaration of Trust. The Bank of New York acts as debenture trustee under the
Guarantee and the Indenture. See "Description of Exchange Guarantee" and
"Description of Exchange Junior Subordinated Debentures." The holder of the
Common Securities of the Trust or, if an Event of Default under the Declaration
of Trust has occurred and is continuing, the holders of a majority in
Liquidation Amount of the Capital Securities, will be entitled to appoint,
remove, or replace the Property Trustee and/or the Delaware Trustee. In no event
will the holders of the Capital Securities have the right to vote to appoint,
remove, or replace the Administrative Trustees; such voting rights will be
vested exclusively in the holder of the Common Securities. The duties and
obligations of each Trustee are governed by the Declaration of Trust and the
Delaware Business Trust Act. AGL Resources has and will continue to pay all
fees, expenses, debts, and obligations (other than the Trust Securities) related
to the Trust and the Exchange Offer, subject to limitations contained herein,
and has and will continue to pay, directly or indirectly, all ongoing costs,
expenses, and liabilities of the Trust. The principal executive office of the
Trust is c/o AGL Resources Inc., 303 Peachtree Street, N.E., Atlanta, Georgia
30308.
THE EXCHANGE OFFER
PURPOSE OF THE EXCHANGE OFFER
In connection with the sale of the Original Capital Securities, AGL
Resources and the Trust entered into the Registration Rights Agreement with the
Initial Purchasers, pursuant to which AGL Resources and the Trust agreed to file
and to use their reasonable efforts to cause to become effective with the
Commission a registration statement with respect to the exchange of the Original
Capital Securities for capital securities with terms identical in all material
respects to the terms of the Original Capital Securities. A copy of the
Registration Rights Agreement has been filed as an Exhibit to the Registration
Statement of which this Prospectus is a part.
The Exchange Offer is being made to satisfy the contractual obligations
of AGL Resources and the Trust under the Registration Rights Agreement. The form
and terms of the Exchange Capital Securities are the same as the form and terms
of the Original Capital Securities except that the Exchange Capital Securities
have been registered under the
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Securities Act and will not be subject to certain restrictions on transfer
applicable to the Original Capital Securities, and will not provide for any
increase in the Distribution Rate thereon. In that regard, the Original Capital
Securities provide, among other things, that, if a registration statement
relating to the Exchange Offer has not been filed by November 8, 1997 and
declared effective by December 28, 1997, then commencing on the day after either
such date, as liquidation damages, additional interest (the "Additional
Interest") shall accrue on the principal amount of the Original Junior
Subordinated Debentures, and corresponding additional distributions (the
"Additional Distributions") shall accumulate on the Liquidation Amount of the
Trust Securities, each at a rate of 0.25% per annum until such registration
statement is filed or declared effective, as the case may be. Upon consummation
of the Exchange Offer, holders of Original Capital Securities will not be
entitled to any increase in the Distribution Rate thereon or any further
registration rights under the Registration Rights Agreement, except under
limited circumstances. See "Risk Factors--Consequences of a Failure to Exchange
Original Capital Securities" and "Description of Exchange Capital Securities."
The Exchange Offer is not being made to, nor will the Trust accept
tenders for exchange from, holders of Original Capital Securities in any
jurisdiction in which the Exchange Offer or the acceptance thereof would not be
in compliance with the securities or blue sky laws of such jurisdiction. AGL
Resources and the Trust have taken action in some, but not all, states and
other jurisdictions to comply with the securities or blue sky laws of such
states and jurisdictions. A list of states and other jurisdictions for which
AGL Resources and the Trust has taken action to comply is available upon
request by contacting AGL Resources Inc., 303 Peachtree Street, N.E., Atlanta,
Georgia 30308; Attention Pamela J. Anthony. AGL Resources' telephone number at
such address is (404) 584-9470.
Unless the context requires otherwise, the term "holder" with respect
to the Exchange Offer means any Person in whose name the Original Capital
Securities are registered on the books of the Trust or any other Person who has
obtained a properly completed bond power from the registered holder, or any
Person whose Original Capital Securities are held of record by The Depository
Trust Company ("DTC") who desires to deliver such Original Capital Securities by
book-entry transfer at DTC.
Pursuant to the Exchange Offer, AGL Resources will exchange as soon as
practicable after the date hereof, the Original Guarantee for the Exchange
Guarantee and the Original Junior Subordinated Debentures, in an amount
corresponding to the Original Capital Securities accepted for exchange, for a
like aggregate principal amount of the Exchange Junior Subordinated Debentures.
The Exchange Guarantee and Exchange Junior Subordinated Debentures have been
registered under the Securities Act.
TERMS OF THE EXCHANGE OFFER
The Trust hereby offers, upon the terms and subject to the conditions
set forth in this Prospectus and in the accompanying Letter of Transmittal, to
exchange up to 75,000 Exchange Capital Securities for a like number of Original
Capital Securities properly tendered on or prior to the Expiration Date and not
properly withdrawn in accordance with the procedures described below. The Trust
will issue, promptly after the Expiration Date, up to 75,000 of Exchange Capital
Securities in exchange for a like number of outstanding Original Capital
Securities tendered and accepted in connection with the Exchange Offer. Holders
may tender their Original Capital Securities in whole or in part in a
Liquidation Amount of not less than $100,000 (100 Capital Securities) or any
integral multiple of $1,000 Liquidation Amount (one Capital Security) in excess
thereof; provided that if any holder tenders in part Original Capital
Securities, the Liquidation Amount of the untendered Original Capital Securities
must not be less than $100,000 (100 Original Capital Securities).
The Exchange Offer is not conditioned upon any minimum number of
Original Capital Securities being tendered. As of the date of this Prospectus,
75,000 Original Capital Securities are outstanding.
Holders of Original Capital Securities do not have any appraisal or
dissenters' rights in connection with the Exchange Offer. Original Capital
Securities which are not tendered for or are tendered but not accepted in
connection with the Exchange Offer will remain outstanding and be entitled to
the benefits of the Declaration of Trust, but will not be entitled to any
further registration rights under the Registration Rights Agreement, except
under limited circumstances. See "Risk Factors--Consequences of a Failure to
Exchange Original Capital Securities" and "Description of Exchange Capital
Securities."
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If any tendered Original Capital Securities are not accepted for
exchange because of an invalid tender or the occurrence of certain other events
set forth herein or otherwise, certificates for any such unaccepted Original
Capital Securities will be returned, without expense, to the tendering holder
thereof promptly after the Expiration Date.
Holders who tender Original Capital Securities in connection with the
Exchange Offer will not be required to pay brokerage commissions or fees or,
subject to the instructions in the Letter of Transmittal, transfer taxes with
respect to the exchange of Original Capital Securities in connection with the
Exchange Offer. AGL Resources will pay all charges and expenses, other than
certain applicable taxes described below, in connection with the Exchange Offer.
See "--Fees and Expenses."
NEITHER AGL RESOURCES, THE BOARD OF DIRECTORS OF AGL RESOURCES NOR ANY
TRUSTEE OF THE TRUST MAKES ANY RECOMMENDATION TO HOLDERS OF ORIGINAL CAPITAL
SECURITIES AS TO WHETHER TO TENDER OR REFRAIN FROM TENDERING ALL OR ANY PORTION
OF THEIR ORIGINAL CAPITAL SECURITIES PURSUANT TO THE EXCHANGE OFFER. IN
ADDITION, NO ONE HAS BEEN AUTHORIZED TO MAKE ANY SUCH RECOMMENDATION. HOLDERS OF
ORIGINAL CAPITAL SECURITIES MUST MAKE THEIR OWN DECISIONS WHETHER TO TENDER
PURSUANT TO THE EXCHANGE OFFER AND, IF SO, THE AGGREGATE AMOUNT OF ORIGINAL
CAPITAL SECURITIES TO TENDER BASED ON SUCH HOLDERS' OWN FINANCIAL POSITIONS AND
REQUIREMENTS.
EXPIRATION DATE; EXTENSIONS; AMENDMENTS
The term "Expiration Date" means 5:00 p.m., New York City time, on
___________, 1997 unless the Exchange Offer is extended by AGL Resources or the
Trust (in which case the term "Expiration Date" shall mean the latest date and
time to which the Exchange Offer is extended).
AGL Resources and the Trust expressly reserve the right in their sole
and absolute discretion, subject to applicable law, at any time and from time to
time, (i) to delay the acceptance of the Original Capital Securities for
exchange, (ii) to terminate the Exchange Offer (whether or not any Original
Capital Securities have theretofore been accepted for exchange) if the Trust
determines, in its sole and absolute discretion, that any of the events or
conditions referred to under "--Conditions to the Exchange Offer" have occurred
or exist or have not been satisfied, (iii) to extend the Expiration Date of the
Exchange Offer and retain all Original Capital Securities tendered pursuant to
the Exchange Offer, subject, however, to the right of holders of Original
Capital Securities to withdraw their tendered Original Capital Securities as
described under "--Withdrawal Rights," and (iv) to waive any condition or
otherwise amend the terms of the Exchange Offer in any respect. If the Exchange
Offer is amended in a manner determined by AGL Resources and the Trust to
constitute a material change, or if AGL Resources and the Trust waive a material
condition of the Exchange Offer, AGL Resources and the Trust will promptly
disclose such amendment by means of a prospectus supplement that will be
distributed to the holders of the Original Capital Securities, and AGL Resources
and the Trust will extend the Exchange Offer to the extent required by Rule
14e-1 under the Exchange Act.
Any such delay in acceptance, extension, termination or amendment will
be followed promptly by oral or written notice thereof to the Exchange Agent and
by making a public announcement thereof, and such announcement in the case of an
extension will be made no later than 9:00 a.m., New York City time, on the next
business day after the previously scheduled Expiration Date. Without limiting
the manner in which AGL Resources and the Trust may choose to make any public
announcement and subject to applicable law, AGL Resources and the Trust shall
have no obligation to publish, advertise or otherwise communicate any such
public announcement other than by issuing a release to an appropriate news
agency.
ACCEPTANCE FOR EXCHANGE AND ISSUANCE OF EXCHANGE CAPITAL SECURITIES
Upon the terms and subject to the conditions of the Exchange Offer, the
Trust will exchange, and will issue to the Exchange Agent, Exchange Capital
Securities for Original Capital Securities validly tendered and not withdrawn
promptly after the Expiration Date.
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In all cases, delivery of Exchange Capital Securities in exchange for
Original Capital Securities tendered and accepted for exchange pursuant to the
Exchange Offer will be made only after timely receipt by the Exchange Agent of
(i) Original Capital Securities or a book-entry confirmation of a book-entry
transfer of Original Capital Securities into the Exchange Agent's account at
DTC, (ii) the Letter of Transmittal (or facsimile thereof), properly completed
and duly executed, with any required signature guarantees, and (iii) any other
documents required by the Letter of Transmittal.
The term "book-entry confirmation" means a timely confirmation of a
book-entry transfer of Original Capital Securities into the Exchange Agent's
account at DTC.
Subject to the terms and conditions of the Exchange Offer, the Trust
will be deemed to have accepted for exchange, and thereby exchanged, Original
Capital Securities validly tendered and not withdrawn as, if, and when the Trust
gives oral or written notice to the Exchange Agent of the Trust's acceptance of
such Original Capital Securities for exchange pursuant to the Exchange Offer.
The Exchange Agent will act as agent for the Trust for the purpose of receiving
tenders of Original Capital Securities, Letters of Transmittal and related
documents, and as agent for tendering holders for the purpose of receiving
Original Capital Securities, Letters of Transmittal and related documents and
transmitting Exchange Capital Securities to validly tendering holders. Such
exchange will be made promptly after the Expiration Date. If for any reason
whatsoever, acceptance for exchange or the exchange of any Original Capital
Securities tendered pursuant to the Exchange Offer is delayed (whether before or
after the Trust's acceptance for exchange of Original Capital Securities) or the
Trust extends the Exchange Offer or is unable to accept for exchange or exchange
Original Capital Securities tendered pursuant to the Exchange Offer, then,
without prejudice to the Trust's rights set forth herein, the Exchange Agent
may, nevertheless, on behalf of the Trust and subject to Rule 14e-1(c) under the
Exchange Act, retain tendered Original Capital Securities and such Original
Capital Securities may not be withdrawn except to the extent tendering holders
are entitled to withdrawal rights as described under "--Withdrawal Rights."
Pursuant to the Letter of Transmittal, a holder of Original Capital
Securities will warrant and agree in the Letter of Transmittal that it has full
power and authority to tender, exchange, sell, assign, and transfer Original
Capital Securities, that the Trust will acquire good, marketable and
unencumbered title to the tendered Original Capital Securities, free and clear
of all liens, restrictions, charges, and encumbrances, and the Original Capital
Securities tendered for exchange are not subject to any adverse claims or
proxies. The holder also will warrant and agree that it will, upon request,
execute and deliver any additional documents deemed by the Trust or the Exchange
Agent to be necessary or desirable to complete the exchange, sale, assignment,
and transfer of the Original Capital Securities tendered pursuant to the
Exchange Offer.
PROCEDURES FOR TENDERING ORIGINAL CAPITAL SECURITIES
VALID TENDER. Except as set forth below, in order for Original Capital
Securities to be validly tendered pursuant to the Exchange Offer, a properly
completed and duly executed Letter of Transmittal (or facsimile thereof), with
any required signature guarantees and any other required documents, must be
received by the Exchange Agent at one of its addresses set forth under
"--Exchange Agent," and either (i) tendered Original Capital Securities must be
received by the Exchange Agent, or (ii) such Original Capital Securities must be
tendered pursuant to the procedures for book-entry transfer set forth below and
a book-entry confirmation must be received by the Exchange Agent, in each case
on or prior to the Expiration Date, or (iii) the guaranteed delivery procedures
set forth below must be complied with.
If less than all of the Original Capital Securities are tendered, a
tendering holder should fill in the amount of Original Capital Securities being
tendered in the appropriate box on the Letter of Transmittal. The entire amount
of Original Capital Securities delivered to the Exchange Agent will be deemed to
have been tendered unless otherwise indicated.
THE METHOD OF DELIVERY OF CERTIFICATES, THE LETTER OF TRANSMITTAL AND
ALL OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND SOLE RISK OF THE TENDERING
HOLDER, AND
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DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE EXCHANGE AGENT.
IF DELIVERY IS BY MAIL, REGISTERED MAIL, RETURN RECEIPT REQUESTED, PROPERLY
INSURED, OR AN OVERNIGHT DELIVERY SERVICE IS RECOMMENDED. IN ALL CASES,
SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
BOOK-ENTRY TRANSFER. The Exchange Agent will establish an account with
respect to the Original Capital Securities at DTC for purposes of the Exchange
Offer within two business days after the date of this Prospectus. Any financial
institution that is a participant in DTC's book-entry transfer facility system
may make a book-entry delivery of the Original Capital Securities by causing DTC
to transfer such Original Capital Securities into the Exchange Agent's account
at DTC in accordance with DTC's procedures for transfers. However, although
delivery of Original Capital Securities may be effected through book-entry
transfer into the Exchange Agent's account at DTC, the Letter of Transmittal (or
facsimile thereof), properly completed and duly executed, with any required
signature guarantees and any other required documents, must in any case be
delivered to and received by the Exchange Agent at its address set forth under
"--Exchange Agent" on or prior to the Expiration Date, or the guaranteed
delivery procedure set forth below must be complied with.
DELIVERY OF DOCUMENTS TO DTC IN ACCORDANCE WITH DTC'S PROCEDURES DOES
NOT CONSTITUTE DELIVERY TO THE EXCHANGE AGENT.
SIGNATURE GUARANTEES. Certificates for the Original Capital Securities
need not be endorsed and signature guarantees on the Letter of Transmittal are
unnecessary unless (a) a certificate for the Original Capital Securities is
registered in a name other than that of the person surrendering the certificate
or (b) such holder completes the box entitled "Special Issuance Instructions" or
"Special Delivery Instructions" in the Letter of Transmittal. In the case of (a)
or (b) above, such certificates for Original Capital Securities must be duly
endorsed or accompanied by a properly executed bond power, with the endorsement
or signature on the bond power and on the Letter of Transmittal guaranteed by a
firm or other entity identified in Rule 17Ad-15 under the Exchange Act as an
"eligible guarantor institution," including (as such terms are defined therein):
(i) a bank; (ii) a broker, dealer, municipal securities broker or dealer, or
government securities broker or dealer; (iii) a credit union; (iv) a national
securities exchange, registered securities association, or clearing agency; or
(v) a savings association that is a participant in a Securities Transfer
Association (an "Eligible Institution"), unless surrendered on behalf of such
Eligible Institution. See Instructions 1 and 2 to the Letter of Transmittal.
GUARANTEED DELIVERY. If a holder desires to tender Original Capital
Securities pursuant to the Exchange Offer and the certificates for such Original
Capital Securities are not immediately available or time will not permit all
required documents to reach the Exchange Agent on or prior to the Expiration
Date, or the procedure for book-entry transfer cannot be completed on a timely
basis, such Original Capital Securities may nevertheless be tendered, provided
that all of the following guaranteed delivery procedures are complied with:
(a) such tenders are made by or through an Eligible
Institution;
(b) properly completed and duly executed Notice of Guaranteed
Delivery, substantially in the form accompanying the Letter of Transmittal, is
received by the Exchange Agent, as provided below, on or prior to the Expiration
Date; and
(c) the certificates (or a book-entry confirmation)
representing all tendered Original Capital Securities, in proper form for
transfer, together with a properly completed and duly executed Letter of
Transmittal (or facsimile thereof), with any required signature guarantees and
any other documents required by the Letter of Transmittal, are received by the
Exchange Agent within three New York Stock Exchange trading days after the date
of execution of such Notice of Guaranteed Delivery.
The Notice of Guaranteed Delivery may be delivered by hand, or
transmitted by facsimile or mail to the Exchange Agent and must include a
guarantee by an Eligible Institution in the form set forth in such notice.
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Notwithstanding any other provision hereof, the delivery of Exchange
Capital Securities in exchange for Original Capital Securities tendered and
accepted for exchange pursuant to the Exchange Offer will in all cases be made
only after timely receipt by the Exchange Agent of Original Capital Securities,
or of a book-entry confirmation with respect to such Original Capital
Securities, and a properly completed and duly executed Letter of Transmittal (or
facsimile thereof), together with any required signature guarantees and any
other documents required by the Letter of Transmittal. Accordingly, the delivery
of Exchange Capital Securities might not be made to all tendering holders at the
same time, and will depend upon when Original Capital Securities, book-entry
confirmations with respect to Original Capital Securities and other required
documents are received by the Exchange Agent.
The Trust's acceptance for exchange of Original Capital Securities
tendered pursuant to any of the procedures described above will constitute a
binding agreement between the tendering holder and the Trust upon the terms and
subject to the conditions of the Exchange Offer.
DETERMINATION OF VALIDITY. All questions as to the form of documents,
validity, eligibility (including time of receipt), and acceptance for exchange
of any tendered Original Capital Securities will be determined by AGL Resources
and the Trust, in their sole discretion, whose determination shall be final and
binding on all parties. AGL Resources and the Trust reserve the absolute right,
in their sole and absolute discretion, to reject any and all tenders determined
by them not to be in proper form or the acceptance of which, or exchange for,
may, in the opinion of counsel to AGL Resources and the Trust, be unlawful. AGL
Resources and the Trust also reserve the absolute right, subject to applicable
law, to waive any of the conditions of the Exchange Offer as set forth under
"--Conditions to the Exchange Offer" or any condition or irregularity in any
tender of Original Capital Securities of any particular holder whether or not
similar conditions or irregularities are waived in the case of other holders.
The interpretation by AGL Resources and the Trust of the terms and
conditions of the Exchange Offer (including the Letter of Transmittal and the
instructions thereto) will be final and binding. No tender of Original Capital
Securities will be deemed to have been validly made until all irregularities
with respect to such tender have been cured or waived. Neither AGL Resources,
the Trust, any affiliates or assigns of AGL Resources or the Trust, the Exchange
Agent, nor any other Person shall be under any duty to give any notification of
any irregularities in tenders or incur any liability for failure to give any
such notification.
If any Letter of Transmittal, endorsement, bond power, power of
attorney, or any other document required by the Letter of Transmittal is signed
by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation, or other Person acting in a fiduciary or representative capacity,
such Person should so indicate when signing, and unless waived by AGL Resources
and the Trust, proper evidence satisfactory to AGL Resources and the Trust, in
their sole discretion, of such Person's authority to so act must be submitted.
A beneficial owner of Original Capital Securities that are held by or
registered in the name of a broker, dealer, commercial bank, trust company, or
other nominee or custodian is urged to contact such entity promptly if such
beneficial holder wishes to participate in the Exchange Offer.
RESALES OF EXCHANGE CAPITAL SECURITIES
The Trust is making the Exchange Offer for the Exchange Capital
Securities in reliance on the position of the staff of the Division of
Corporation Finance of the Commission as set forth in certain interpretive
letters addressed to third parties in other transactions. However, neither AGL
Resources nor the Trust sought its own interpretive letter and there can be no
assurance that the staff of the Division of Corporation Finance of the
Commission would make a similar determination with respect to the Exchange Offer
as it has in such interpretive letters to third parties. Based on these
interpretations by the staff of the Division of Corporation Finance of the
Commission, and subject to the two immediately following sentences, AGL
Resources and the Trust believe that Exchange Capital Securities issued pursuant
to this Exchange Offer in exchange for Original Capital Securities may be
offered for resale, resold, and otherwise transferred by a holder thereof (other
than a holder who is a broker-dealer) without further compliance with the
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registration and prospectus delivery requirements of the Securities Act,
provided that such Exchange Capital Securities are acquired in the ordinary
course of such holder's business and that such holder is not participating, and
has no arrangement or understanding with any Person to participate, in a
distribution (within the meaning of the Securities Act) of such Exchange Capital
Securities. However, any holder of Original Capital Securities who is an
"affiliate" of AGL Resources or the Trust or who intends to participate in the
Exchange Offer for the purpose of distributing Exchange Capital Securities, or
any broker-dealer who purchased Original Capital Securities from the Trust to
resell pursuant to Rule 144A or any other available exemption under the
Securities Act, (a) will not be able to rely on the interpretations of the staff
of the Division of Corporation Finance of the Commission set forth in the
above-mentioned interpretive letters, (b) will not be permitted or entitled to
tender such Original Capital Securities in the Exchange Offer, and (c) must
comply with the registration and prospectus delivery requirements of the
Securities Act in connection with any sale or other transfer of such Original
Capital Securities unless such sale is made pursuant to an exemption from such
requirements. In addition, as described below, if any broker-dealer holds
Original Capital Securities acquired for its own account as a result of
market-making or other trading activities and exchanges such Original Capital
Securities for Exchange Capital Securities, then such broker-dealer must deliver
a prospectus meeting the requirements of the Securities Act in connection with
any resales of such Exchange Capital Securities.
Each holder of Original Capital Securities who wishes to exchange
Original Capital Securities for Exchange Capital Securities in the Exchange
Offer will be required to represent that (i) it is not an "affiliate" of AGL
Resources or the Trust, (ii) any Exchange Capital Securities to be received by
it are being acquired in the ordinary course of its business, (iii) it has no
arrangement or understanding with any Person to participate in a distribution
(within the meaning of the Securities Act) of such Exchange Capital Securities,
and (iv) if such holder is not a broker-dealer, such holder is not engaged in,
and does not intend to engage in, a distribution (within the meaning of the
Securities Act) of such Exchange Capital Securities. In addition, AGL Resources
and the Trust may require such holder, as a condition to such holder's
eligibility to participate in the Exchange Offer, to furnish to AGL Resources
and the Trust (or an agent thereof) in writing information as to the number of
"beneficial owners" (within the meaning of Rule 13d-3 under the Exchange Act) on
behalf of whom such holder holds the Capital Securities to be exchanged in the
Exchange Offer. Each broker-dealer that receives Exchange Capital Securities for
its own account pursuant to the Exchange Offer must acknowledge that it acquired
the Original Capital Securities for its own account as the result of
market-making activities or other trading activities and must agree that it will
deliver a prospectus meeting the requirements of the Securities Act in
connection with any resale of such Exchange Capital Securities. The Letter of
Transmittal states that by so acknowledging and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act. Based on the position taken by the staff of the
Division of Corporation Finance of the Commission in the interpretive letters
referred to above, AGL Resources and the Trust believe that Participating
Broker-Dealers who acquired Original Capital Securities for their own accounts
as a result of market-making activities or other trading activities may fulfill
their prospectus delivery requirements with respect to the Exchange Capital
Securities received upon exchange of such Original Capital Securities (other
than Original Capital Securities which represent an unsold allotment from the
initial sale of the Original Capital Securities) with a prospectus meeting the
requirements of the Securities Act, which may be the prospectus prepared for an
exchange offer so long as it contains a description of the plan of distribution
with respect to the resale of such Exchange Capital Securities. Accordingly,
this Prospectus, as it may be amended or supplemented from time to time, may be
used by a Participating Broker-Dealer during the period referred to below in
connection with resales of Exchange Capital Securities received in exchange for
Original Capital Securities where such Original Capital Securities were acquired
by such Participating Broker-Dealer for its own account as a result of
market-making or other trading activities. Subject to certain provisions set
forth in the Registration Rights Agreement, AGL Resources and the Trust have
agreed that this Prospectus, as it may be amended or supplemented from time to
time, may be used by a Participating Broker-Dealer in connection with resales of
such Exchange Capital Securities for a period ending 180 days after the
Expiration Date (subject to extension under certain limited circumstances
described below) or, if earlier, when all such Exchange Capital Securities have
been disposed of by such Participating Broker-Dealer. See "Plan of
Distribution." However, a Participating Broker-Dealer who intends to use this
Prospectus in connection with the resale of Exchange Capital Securities received
in exchange for Original Capital Securities pursuant to the Exchange Offer must
notify AGL Resources or the Trust, or cause AGL Resources or the Trust to be
notified, on or prior to the Expiration Date, that it is a Participating
Broker-Dealer. Such notice may be given in the space provided for that purpose
in the Letter of Transmittal or may be delivered to the Exchange Agent
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at one of the addresses set forth herein under "--Exchange Agent." Any
Participating Broker-Dealer who is an "affiliate" of AGL Resources or the Trust
may not rely on such interpretive letters and must comply with the registration
and prospectus delivery requirements of the Securities Act in connection with
any resale transaction.
In that regard, each Participating Broker-Dealer who surrenders
Original Capital Securities pursuant to the Exchange Offer will be deemed to
have agreed, by execution of the Letter of Transmittal, that upon receipt of
notice from AGL Resources or the Trust of the occurrence of any event or the
discovery of (i) any fact which makes any statement contained or incorporated by
reference in this Prospectus untrue in any material respect or (ii) any fact
which causes this Prospectus to omit to state a material fact necessary in order
to make the statements contained or incorporated by reference herein, in light
of the circumstances under which they were made, not misleading, or (iii) of the
occurrence of certain other events specified in the Registration Rights
Agreement, such Participating Broker-Dealer will suspend the sale of Exchange
Capital Securities (or the Exchange Guarantee or the Exchange Junior
Subordinated Debentures, as applicable) pursuant to this Prospectus until AGL
Resources or the Trust has amended or supplemented this Prospectus to correct
such misstatement or omission and has furnished copies of the amended or
supplemented Prospectus to such Participating Broker-Dealer, or AGL Resources or
the Trust has given notice that the sale of the Exchange Capital Securities (or
the Exchange Guarantee or the Exchange Junior Subordinated Debentures, as
applicable) may be resumed, as the case may be. If AGL Resources or the Trust
gives such notice to suspend the sale of the Exchange Capital Securities (or the
Exchange Guarantee or the Exchange Junior Subordinated Debentures, as
applicable), it shall extend the 180-day period referred to above during which
Participating Broker-Dealers are entitled to use this Prospectus in connection
with the resale of Exchange Capital Securities by the number of days during the
period from and including the date of the giving of such notice to and including
the date when Participating Broker-Dealers shall have received copies of the
amended or supplemented Prospectus necessary to permit resales of the Exchange
Capital Securities or to and including the date on which AGL Resources or the
Trust has given notice that the sale of Exchange Capital Securities (or the
Exchange Guarantee or the Exchange Junior Subordinated Debentures, as
applicable) may be resumed, as the case may be.
WITHDRAWAL RIGHTS
Except as otherwise provided herein, tenders of Original Capital
Securities may be withdrawn at any time on or prior to the Expiration Date.
In order for a withdrawal to be effective, a written, telegraphic,
telex, or facsimile transmission of such notice of withdrawal must be timely
received by the Exchange Agent at one of its addresses set forth under
"--Exchange Agent" on or prior to the Expiration Date. Any such notice of
withdrawal must specify the name of the person who tendered the Original Capital
Securities to be withdrawn, the aggregate principal amount of Original Capital
Securities to be withdrawn, and (if certificates for such Original Capital
Securities have been tendered) the name of the registered holder of the Original
Capital Securities as set forth on the Original Capital Securities, if different
from that of the person who tendered such Original Capital Securities. If
Original Capital Securities have been delivered or otherwise identified to the
Exchange Agent, then prior to the physical release of such Original Capital
Securities, the tendering holder must submit the serial numbers shown on the
particular Original Capital Securities to be withdrawn and the signature on the
notice of withdrawal must be guaranteed by an Eligible Institution, except in
the case of Original Capital Securities tendered for the account of an Eligible
Institution. If Original Capital Securities have been tendered pursuant to the
procedures for book-entry transfer set forth in "--Procedures for Tendering
Original Capital Securities," the notice of withdrawal must specify the name and
number of the account at DTC to be credited with the withdrawal of Original
Capital Securities, in which case a notice of withdrawal will be effective if
delivered to the Exchange Agent by written, telegraphic, telex, or facsimile
transmission. Withdrawals of tenders of Original Capital Securities may not be
rescinded. Original Capital Securities properly withdrawn will not be deemed
validly tendered for purposes of the Exchange Offer, but may be retendered at
any subsequent time on or prior to the Expiration Date by following any of the
procedures described above under "--Procedures for Tendering Original Capital
Securities."
All questions as to the validity, form, and eligibility (including time
of receipt) of such withdrawal notices will be determined by AGL Resources and
the Trust, in their sole discretion, whose determination shall be final and
binding
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on all parties. Neither AGL Resources, the Trust, any affiliates or assigns of
AGL Resources or the Trust, the Exchange Agent, nor any other person shall be
under any duty to give any notification of any irregularities in any notice of
withdrawal or incur any liability for failure to give any such notification. Any
Original Capital Securities which have been tendered but which are withdrawn
will be returned to the holder thereof promptly after withdrawal.
DISTRIBUTIONS ON EXCHANGE CAPITAL SECURITIES
Distributions on each Exchange Capital Security will accrue from the
last date on which a Distribution was paid on the Original Capital Security
tendered in exchange therefor, or, if no Distribution has been paid on such
Original Capital Security, from the date of original issuance of the Original
Capital Securities (the "Issue Date"). Holders of Original Capital Securities
whose Original Capital Securities are accepted for exchange will not receive
Distributions on such Original Capital Securities and will be deemed to have
waived the right to receive any Distributions on such Original Capital
Securities from the last date upon which a Distribution was paid on the Original
Capital Securities, or, if no Distribution has been paid on such Original
Capital Security, from the Issue Date.
CONDITIONS TO THE EXCHANGE OFFER
Notwithstanding any other provisions of the Exchange Offer, or any
extension of the Exchange Offer, AGL Resources and the Trust will not be
required to accept for exchange, or to exchange, any Original Capital Securities
for any Exchange Capital Securities, and, as described below, may terminate the
Exchange Offer (whether or not any Original Capital Securities have theretofore
been accepted for exchange) or may waive any conditions to or amend the Exchange
Offer, if any of the following conditions have occurred or exists or have not
been satisfied:
(a) there shall occur a change in the current interpretation
by the staff of the Commission which permits the Exchange Capital Securities
issued pursuant to the Exchange Offer in exchange for Original Capital
Securities to be offered for resale, resold, and otherwise transferred by
holders thereof (other than broker-dealers and any such holder which is an
"affiliate" of AGL Resources or the Trust within the meaning of Rule 405 under
the Securities Act) without compliance with the registration and prospectus
delivery provisions of the Securities Act, provided that such Exchange Capital
Securities are acquired in the ordinary course of such holders' business and
such holders have no arrangement or understanding with any person to participate
in the distribution of such Exchange Capital Securities; or
(b) any law, statute, rule, or regulation shall have been
adopted or enacted which, in the judgment of AGL Resources or the Trust, would
reasonably be expected to impair its ability to proceed with the Exchange Offer;
or
(c) a stop order shall have been issued by the Commission or
any state securities authority suspending the effectiveness of the Registration
Statement, or proceedings shall have been initiated or, to the knowledge of AGL
Resources or the Trust, threatened for that purpose, or any governmental
approval has not been obtained, which approval AGL Resources or the Trust shall,
in its sole discretion, deem necessary for the consummation of the Exchange
Offer as contemplated hereby; or
(d) AGL Resources shall receive an opinion of counsel
experienced in such matters to the effect that as a result of 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, or as a result of any official
administrative pronouncement or judicial decision interpreting or applying such
laws or regulations, which amendment or change is effective or such
pronouncement or decision is announced or made effective on or after the Issue
Date, there is more than an insubstantial risk that (a) the Trust is, or will be
within 90 days of the date of such opinion, subject to United States federal
income tax with respect to all or part of the income received or accrued on the
Junior Subordinated Debentures, (b) interest payable by AGL Resources on the
Junior Subordinated Debentures is not, or within 90 days of the date of such
opinion will not be, deductible by AGL Resources, in whole or in part, for
United
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States federal income tax purposes, or (c) the Trust is, or will be within 90
days of the date of such opinion, subject or more than a de minimis amount of
other taxes, duties or other governmental charges.
If AGL Resources or the Trust determines in its sole and absolute
discretion that any of the foregoing events or conditions has occurred or exists
or has not been satisfied, it may, subject to applicable law, terminate the
Exchange Offer (whether or not any Original Capital Securities have theretofore
been accepted for exchange) or may waive any such condition or otherwise amend
the terms of the Exchange Offer in any respect. If such waiver or amendment
constitutes a material change to the Exchange Offer, AGL Resources or the Trust
will promptly disclose such waiver or amendment by means of a prospectus
supplement that will be distributed to the registered holders of the Original
Capital Securities and will extend the Exchange Offer to the extent required by
Rule 14e-1 under the Exchange Act.
EXCHANGE AGENT
The Bank of New York has been appointed as Exchange Agent for the
Exchange Offer. Delivery of the Letters of Transmittal and any other required
documents, questions, requests for assistance, and requests for additional
copies of this Prospectus or of the Letter of Transmittal should be directed to
the Exchange Agent as follows:
By Hand or Overnight Delivery:
The Bank of New York
101 Barclay Street
Corporate Trust Services Window, Ground Level
New York, New York 10286
Attention: Enrique Lopez - 7 East
Reorganization Section
By Registered or Certified Mail:
The Bank of New York
101 Barclay Street - 7 East
New York, New York 10286
Attention: Enrique Lopez
Reorganization Section
Confirm By Telephone:
(212) 815-2742
Facsimile Transmissions:
(ELIGIBLE INSTITUTIONS ONLY)
(212) 815-6339
Delivery to other than the above addresses or facsimile number will not
constitute a valid delivery.
FEES AND EXPENSES
AGL Resources has agreed to pay the Exchange Agent reasonable and
customary fees for its services and will reimburse it for its reasonable
out-of-pocket expenses in connection therewith. AGL Resources will also pay
brokerage houses and other custodians, nominees, and fiduciaries the reasonable
out-of-pocket expenses incurred by them in forwarding copies of this Prospectus
and related documents to the beneficial owners of Original Capital Securities,
and in handling or tendering for their customers.
Holders who tender their Original Capital Securities for exchange will
not be obligated to pay any transfer taxes in connection therewith. If, however,
Exchange Capital Securities are to be delivered to, or are to be issued in the
name of, any person other than the registered holder of the Original Capital
Securities tendered, or if a transfer tax is imposed
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for any reason other than the exchange of Original Capital Securities in
connection with the Exchange Offer, then the amount of any such transfer taxes
(whether imposed on the registered holder or any other persons) will be payable
by the tendering holder. If satisfactory evidence of payment of such taxes or
exemption therefrom is not submitted with the Letter of Transmittal, the amount
of such transfer taxes will be billed directly to such tendering holder.
Neither AGL Resources nor the Trust will make any payment to brokers,
dealers or other nominees soliciting acceptances of the Exchange Offer.
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DESCRIPTION OF EXCHANGE SECURITIES
The terms of the Original Securities are identical in all material
respects to the Exchange Securities, except that (i) the Original Securities
have not been registered under the Securities Act, are subject to certain
restrictions on transfer and are entitled to certain rights under the
Registration Rights Agreement (which rights will terminate upon consummation of
the Exchange Offer, except under limited circumstances), (ii) the Exchange
Capital Securities will not contain the $100,000 minimum Liquidation Amount
transfer restriction and certain other restrictions on transfer applicable to
Original Capital Securities, (iii) the Exchange Capital Securities will not
provide for any increase in the Distribution Rate thereon, and (iv) the Exchange
Junior Subordinated Debentures will not provide for any increase in the interest
rate thereon. The Original Securities provide that, in the event that a
registration statement relating to the Exchange Offer has not been filed by
November 8, 1997 and been declared effective by December 28, 1997, or, in
certain limited circumstances, in the event a shelf registration statement (the
"Shelf Registration Statement") with respect to the resale of the Original
Capital Securities is not declared effective by the time required by the
Registration Rights Agreement, then liquidated damages will accrue at the rate
of 0.25% per annum on the principal amount of the Original Junior Subordinated
Debentures and Distributions will accrue at the rate of 0.25% per annum on the
Liquidation Amount of the Original Capital Securities, for the period from the
occurrence of such event until such time as such registration statement has been
filed or declared effective, as the case may be. The Exchange Securities are
not, and upon consummation of the Exchange Offer the Original Securities will
not be, entitled to any such additional interest or Distributions. Accordingly,
holders of Original Capital Securities should review the information set forth
under "Risk Factors--Consequences of a Failure to Exchange Original Capital
Securities" and "Description of Exchange Capital Securities."
DESCRIPTION OF EXCHANGE CAPITAL SECURITIES
The Exchange Capital Securities will represent preferred undivided
beneficial interests in the assets of the Trust, and the holders thereof will be
entitled to a preference over the Common Securities in certain circumstances
with respect to Distributions and amounts payable on redemption of the Trust
Securities or liquidation of the Trust. See "--Subordination of Common
Securities." The Declaration of Trust has been qualified by the Trust Indenture
Act of 1939, as amended (the "Trust Indenture Act"). This summary of certain
provisions of the Capital Securities, the Common Securities and the Declaration
of Trust does not purport to be complete and is subject to, and is qualified in
its entirety by reference to, all the provisions of the Declaration of Trust,
including the definitions therein of certain terms.
GENERAL
The Exchange Capital Securities will be limited to $75,000,000
aggregate Liquidation Amount at any one time outstanding, less the aggregate
Liquidation Amount of any Original Capital Securities that are not properly
tendered for exchange in the Exchange Offer. The Exchange Capital Securities
will rank pari passu, and payments will be made thereon pro rata, with the
Common Securities except as described under "--Subordination of Common
Securities." Legal title to the Junior Subordinated Debentures will be held by
the Property Trustee in trust for the benefit of the holders of the Trust
Securities. The Exchange Guarantee will not guarantee payment of Distributions
or amounts payable on redemption of the Exchange Capital Securities or
liquidation of the Trust when the Trust does not have funds on hand legally
available for such payments. See "Description of Exchange Guarantee."
DISTRIBUTIONS
Distributions on the Exchange Capital Securities will be cumulative,
will accumulate from the last date on which a Distribution was paid on the
Original Capital Security tendered in exchange therefor, or if no Distribution
has been paid on such Original Capital Security, from the Issue Date (June 11,
1997), and will be payable semi-annually in arrears on June 1 and December 1 of
each year, at the annual Distribution Rate of 8.17% of the Liquidation Amount to
the holders of record of the Exchange Capital Securities on the May 15 or
November 15 immediately preceding such date. The amount of Distributions payable
for any period will be computed on the basis of a 360-day year of twelve
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30-day months. In the event that any Distribution Date on which Distributions
are payable on the Exchange Capital Securities is not a Business Day (as defined
below), payment of the Distribution payable on such date will be made on the
next succeeding day that is a Business Day (and without any interest or other
payment in respect to any such delay), in each case with the same force and
effect as if made on such date. A "Business Day" shall mean any day other than a
Saturday or a Sunday, or a day on which banking institutions in The City of New
York are authorized or required by law or executive order to remain closed.
So long as no Debenture Event of Default shall have occurred and be
continuing, AGL Resources will have the right under the Indenture to defer the
payment of interest on the Exchange Junior Subordinated Debentures at any time
or from time to time for a period not exceeding 10 consecutive semi-annual
periods with respect to each Extension Period, provided that no Extension Period
may extend beyond the Stated Maturity Date. Upon any such election, semi-annual
Distributions on the Exchange Capital Securities will be deferred by the Trust
during any such Extension Period. Distributions to which holders of the Exchange
Capital Securities are entitled during any such Extension Period will accumulate
additional Distributions thereon at the rate per annum of 8.17% thereof,
compounded semi-annually from the relevant Distribution Date. The term
"Distributions," as used herein, shall include any such additional
Distributions.
Prior to the termination of any such Extension Period, AGL Resources
may further extend such Extension Period, provided that such extension does not
cause such Extension Period to exceed 10 consecutive semi-annual periods or to
extend beyond the Stated Maturity Date. Upon the termination of any such
Extension Period and the payment of all amounts then due, and subject to the
foregoing limitations, AGL Resources may elect to begin a new Extension Period.
AGL Resources must give the Property Trustee, the Administrative Trustees, and
the Indenture Trustee notice of its election of any such Extension Period at
least five Business Days prior to the earlier of (i) the date the Distributions
on the Exchange Capital Securities would have been payable except for the
election to begin such Extension Period or (ii) the date the Administrative
Trustees are required to give notice to any securities exchange or quotation
system or to holders of such Exchange Capital Securities of the record date or
the date such Distributions are payable but in any event not less than five
Business Days prior to such record date. There is no limitation on the number of
times that AGL Resources may elect to begin an Extension Period. See
"Description of Exchange Junior Subordinated Debentures--Option to Extend
Interest Payment Date" and "Certain Federal Income Tax Consequences--Interest
Income and Original Issue Discount."
During any such Extension Period, AGL Resources may not (i) declare or
pay any dividends or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of AGL Resources' capital stock (which
includes common and preferred stock) or (ii) make any payment of principal of or
premium, if any, or interest on or repay, repurchase or redeem any debt
securities of AGL Resources (including Other Debentures) that rank pari passu
with or junior in right of payment to the Exchange Junior Subordinated
Debentures or (iii) make any guarantee payments with respect to any guarantee by
AGL Resources of the debt securities of any subsidiary of AGL Resources
(including Other Guarantees) if such guarantee ranks pari passu with or junior
in right of payment to the Exchange Junior Subordinated Debentures (other than
(a) dividends or distributions in shares of, or options, warrants, or rights to
subscribe for or purchase shares of, common stock of AGL Resources, (b) any
declaration of a dividend in connection with the implementation of a
stockholders' rights plan, or the issuance of stock under any such plan in the
future, or the redemption or repurchase of any such rights pursuant thereto, (c)
payments under the Guarantee, (d) the purchase of fractional shares resulting
from a reclassification of AGL Resources' capital stock, (e) the exchange or
conversion of one class, or series of AGL Resources' capital stock for another
class or series of AGL Resources' capital stock, and (f) the purchase of
fractional interests in shares of AGL Resources' capital stock pursuant to the
conversion or exchange provisions of such capital stock or the security being
converted or exchanged).
Although AGL Resources may in the future exercise its option to defer
payments of interest on the Exchange Junior Subordinated Debentures, AGL
Resources has no such current intention.
The revenue of the Trust available for distribution to holders of the
Exchange Capital Securities will be limited to payments under the Junior
Subordinated Debentures in which the Trust has invested the proceeds from the
issuance
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and sale of the Trust Securities. See "Description of Exchange Junior
Subordinated Debentures--General." If AGL Resources does not make interest
payments on the Junior Subordinated Debentures, the Property Trustee will not
have funds available to pay Distributions on the Capital Securities, including
the Exchange Capital Securities. The payment of Distributions (if and to the
extent the Trust has funds on hand legally available for the payment of such
Distributions) will be guaranteed by AGL Resources on a limited basis as set
forth herein under "Description of Exchange Guarantee."
REDEMPTION
Upon the repayment on the Stated Maturity Date or prepayment prior to
the Stated Maturity Date of the Junior Subordinated Debentures, the proceeds
from such repayment or prepayment shall be applied by the Property Trustee to
redeem a Like Amount (as defined below) of the Trust Securities, upon not less
than 30 nor more than 60 days notice of a date of redemption (the "Redemption
Date"), at the applicable Redemption Price, which shall be equal to (i) in the
case of the repayment of the Junior Subordinated Debentures on the Stated
Maturity Date, the Maturity Redemption Price (equal to the principal of, and
accrued interest on, the Junior Subordinated Debentures), (ii) in the case of
the optional prepayment of the Junior Subordinated Debentures prior to June 1,
2007 upon the occurrence and continuation of a Tax Event or an Investment
Company Act Event, the Special Event Redemption Price (equal to the Special
Event Prepayment Price in respect of the Junior Subordinated Debentures) and
(iii) in the case of the optional prepayment of the Junior Subordinated
Debentures on or after June 1, 2007, the Optional Redemption Price (equal to the
Optional Prepayment Price in respect of the Junior Subordinated Debentures). See
"Description of Exchange Junior Subordinated Debentures--Optional Prepayment"
and "--Special Event Prepayment."
"Like Amount" means (i) with respect to a redemption of the Trust
Securities, Trust Securities having a Liquidation Amount equal to the principal
amount of Junior Subordinated Debentures to be paid in accordance with their
terms and (ii) with respect to a distribution of Junior Subordinated Debentures
upon the liquidation of the Trust, Junior Subordinated Debentures having a
principal amount equal to the Liquidation Amount of the Trust Securities of the
holder to whom such Junior Subordinated Debentures are distributed.
REDEMPTION PROCEDURES
If applicable, Trust Securities shall be redeemed at the applicable
Redemption Price with the proceeds from the contemporaneous repayment or
prepayment of the Junior Subordinated Debentures. Any redemption of Capital
Securities shall be made and the applicable Redemption Price shall be payable on
the Redemption Date only to the extent that the Trust has funds legally
available for the payment of such applicable Redemption Price.
If the Trust gives a notice of redemption in respect of the Capital
Securities, then, by 12:00 noon, New York City time, on the Redemption Date, to
the extent funds are legally available, with respect to the Capital Securities
held by DTC or its nominees, the Property Trustee will deposit irrevocably with
DTC funds sufficient to pay the applicable Redemption Price. See "--Form,
Denomination, Book-Entry Procedures and Transfer." With respect to the Capital
Securities held in certificated form, the Property Trustee, to the extent funds
are legally available, will irrevocably deposit with the paying agent for the
Capital Securities funds sufficient to pay the applicable Redemption Price and
will give such paying agent irrevocable instructions and authority to pay the
applicable Redemption Price to the holders thereof upon surrender of their
certificates evidencing the Capital Securities. See "--Payment and Paying
Agency." Notwithstanding the foregoing, Distributions payable on or prior to the
Redemption Date shall be payable to the holders of such Capital Securities on
the relevant record dates for the related Distribution Dates. If notice of
redemption shall have been given and funds deposited as required, then upon the
date of such deposit, all rights of the holders of the Capital Securities will
cease, except the right of the holders of the Capital Securities to receive the
applicable Redemption Price, but without interest on such Redemption Price, and
the Capital Securities will cease to be outstanding. In the event that any
Redemption Date of Capital Securities is not a Business Day, then the applicable
Redemption Price payable on such date will be paid on the next succeeding day
that is a Business Day (and without any interest or other payment in respect of
any such delay), except that, if such Business Day falls in the next calendar
year, such payment will be made on the immediately preceding Business Day. In
the event that payment of the applicable Redemption Price is improperly withheld
or refused and not paid either by the Trust or by AGL Resources pursuant to
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the Exchange Guarantee as described under "Description of Exchange Guarantee,"
Distributions on Capital Securities will continue to accumulate at the then
applicable rate, from the Redemption Date originally established by the Trust to
the date such applicable Redemption Price is actually paid, in which case the
actual payment date will be the Redemption Date for purposes of calculating the
applicable Redemption Price.
Subject to applicable law (including, without limitation, United States
federal securities law), AGL Resources or its subsidiaries may at any time and
from time to time purchase outstanding Capital Securities by tender, in the open
market or by private agreement.
Notice of any redemption will be mailed at least 30 days but not more
than 60 days prior to the Redemption Date to each holder of Capital Securities
at its registered address. Unless AGL Resources defaults in payment of the
applicable Prepayment Price on, or in the repayment of, the Junior Subordinated
Debentures, on and after the Redemption Date, Distributions will cease to accrue
on the Exchange Capital Securities called for redemption.
LIQUIDATION OF THE TRUST AND DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES
AGL Resources will have the right at any time to terminate the Trust
and cause the Exchange Junior Subordinated Debentures to be distributed to the
holders of the Exchange Capital Securities in liquidation of the Trust. Such
right is subject to AGL Resources having received an opinion of counsel to the
effect that such distribution will not be a taxable event to holders of Exchange
Capital Securities.
The Trust shall automatically terminate upon the first to occur of: (i)
certain events of bankruptcy, dissolution or liquidation of AGL Resources; (ii)
the distribution of a Like Amount of the Junior Subordinated Debentures to the
holders of the Trust Securities, if AGL Resources, as Sponsor, has given written
direction to the Property Trustee to terminate the Trust (which direction is
optional and, except as described above, wholly within the discretion of AGL
Resources, as Sponsor); (iii) redemption of all of the Trust Securities as
described under "--Redemption"; (iv) expiration of the term of the Trust; or (v)
the entry of an order for the dissolution of the Trust by a court of competent
jurisdiction.
If a termination occurs as described in clause (i), (ii), (iv), or (v)
above, the Trust shall be liquidated by the Trustees as soon as practicable
after the receipt of any required regulatory approval by distributing, after
satisfaction of liabilities to creditors of the Trust as provided by applicable
law, to the holders of the Trust Securities a Like Amount of the Junior
Subordinated Debentures, unless such distribution is determined by the Property
Trustee not to be practicable, in which event such holders will be entitled to
receive out of the assets of the Trust legally available for distribution to
holders, after satisfaction of liabilities to creditors of the Trust as provided
by applicable law, an amount equal to the aggregate of the Liquidation Amount
plus accumulated and unpaid Distributions thereon to the date of payment (such
amount being the "Liquidation Distribution"). If such Liquidation Distribution
can be paid only in part because the Trust has insufficient assets on hand
legally available to pay in full the aggregate Liquidation Distribution, then
the amounts payable directly by the Trust on the Trust Securities shall be paid
on a pro rata basis, except that if a Debenture Event of Default has occurred
and is continuing, the Capital Securities shall have a priority over the Common
Securities. See "--Subordination of Common Securities."
After the liquidation date is fixed for any distribution of Exchange
Junior Subordinated Debentures to holders of the Exchange Capital Securities,
(i) the Exchange Capital Securities will no longer be deemed to be outstanding,
(ii) each registered global certificate, if any, representing Exchange Capital
Securities and held by DTC or its nominee will receive a registered global
certificate or certificates representing the Exchange Junior Subordinated
Debentures to be delivered upon such distribution, and (iii) any certificates
representing Exchange Capital Securities not held by DTC or its nominee will be
deemed to represent Exchange Junior Subordinated Debentures having a principal
amount equal to the Liquidation Amount of such Exchange Capital Securities, and
bearing accrued and unpaid interest in an amount equal to the accumulated and
unpaid Distributions on such Exchange Capital Securities until such certificates
are presented to the Administrative Trustees or their agent for cancellation,
whereupon AGL Resources will issue to such holder, and the Indenture Trustee
will authenticate, a certificate representing such Exchange Junior Subordinated
Debentures.
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Under current United States federal income tax law and interpretations
and assuming, as expected, that the Trust is treated as a grantor trust, a
distribution of the Exchange Junior Subordinated Debentures should not be a
taxable event to holders of the Exchange Capital Securities. Should there be a
change in law, a change in legal interpretation, a Tax Event or other
circumstances, however, the distribution could be a taxable event to holders of
the Exchange Capital Securities. See "Certain Federal Income Tax
Consequences--Receipt of Junior Subordinated Debentures or Cash Upon Liquidation
of the Trust." If AGL Resources elects neither to redeem the Exchange Junior
Subordinated Debentures prior to maturity nor to liquidate the Trust and
distribute the Exchange Junior Subordinated Debentures to holders of the
Exchange Capital Securities, the Exchange Capital Securities will remain
outstanding until the repayment of the Exchange Junior Subordinated Debentures.
There can be no assurance as to the market prices for the Exchange
Capital Securities or the Exchange Junior Subordinated Debentures that may be
distributed in exchange for the Exchange Capital Securities if a dissolution and
liquidation of the Trust were to occur. Accordingly, the Exchange Capital
Securities that an investor may receive in this Exchange Offer, or the Exchange
Junior Subordinated Debentures that the investor may receive on dissolution and
liquidation of the Trust, may trade at a discount to the price that the investor
paid to purchase the Original Capital Securities exchanged for Exchange Capital
Securities.
SUBORDINATION OF COMMON SECURITIES
Payment of Distributions on, and the Redemption Price of, the Capital
Securities and Common Securities, as applicable, shall be made pro rata based on
the Liquidation Amount of the Trust Securities; provided, however, that if on
any Distribution Date or Redemption Date a Debenture Event of Default shall have
occurred and be continuing, no payment of any Distribution on, or applicable
Redemption Price of, any of the Common Securities, and no other payment on
account of the redemption, liquidation or other acquisition of the Common
Securities, shall be made unless payment in full in cash of all accumulated and
unpaid Distributions on all of the outstanding Capital Securities for all
Distribution periods terminating on or prior thereto, or in the case of payment
of the applicable Redemption Price the full amount of such Redemption Price,
shall have been made or provided for, and all funds available to the Property
Trustee shall first be applied to the payment in full in cash of all
Distributions on, or Redemption Price of, the Capital Securities then due and
payable.
In the case of any Debenture Event of Default, AGL Resources as holder
of the Common Securities will be deemed to have waived any right to act with
respect to such Debenture Event of Default until the effect of such Debenture
Event of Default shall have been cured, waived, or otherwise eliminated. Until
any such Debenture Event of Default has been so cured, waived, or otherwise
eliminated, the Property Trustee shall act solely on behalf of the holders of
the Capital Securities and not on behalf of AGL Resources as holder of the
Common Securities, and only the holders of the Capital Securities will have the
right to direct the Property Trustee to act on their behalf.
EVENTS OF DEFAULT; NOTICE
An "Event of Default" under the Declaration of Trust is deemed to occur
upon the occurrence of: (a) a Debenture Event of Default, (b) default by the
Trust or the Property Trustee in the payment of any Distribution when it becomes
due and payable, and continuation of such default for a period of 30 days; (c)
default by the Trust or the Property Trustee in the payment of any Redemption
Price of any Trust Security when it becomes due and payable; or (d) default in
the performance, or breach, in any material respect, of any other covenant or
warranty of the Trustees in the Declaration of Trust, and continuation of such
default or breach for a period of 60 days after notice to the defaulting Trustee
or Trustees. See "Description of Exchange Junior Subordinated
Debentures--Debenture Events of Default."
Within ten Business Days after the occurrence of any Event of Default
actually known to the Property Trustee, the Property Trustee shall transmit
notice of such Event of Default to the holders of the Capital Securities, the
Administrative Trustees and AGL Resources, as Sponsor, unless such Event of
Default shall have been cured or waived. AGL Resources, as Sponsor, and the
Administrative Trustees are required to file annually with the Property Trustee
a
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certificate as to whether or not they are in compliance with all the conditions
and covenants applicable to them under the Declaration of Trust.
If a Debenture Event of Default has occurred and is continuing, the
Exchange Capital Securities shall have a preference over the Common Securities
as described under "--Liquidation of the Trust and Distribution of Junior
Subordinated Debentures" and "--Subordination of Common Securities."
REMOVAL OF TRUSTEES
Unless a Debenture Event of Default shall have occurred and be
continuing, any Trustee may be removed at any time by the holder of the Common
Securities. If a Debenture Event of Default has occurred and is continuing, the
Property Trustee and the Delaware Trustee may be removed at such time by the
holders of a majority in Liquidation Amount of the outstanding Capital
Securities. In no event will the holders of the Capital Securities have the
right to vote to appoint, remove, or replace the Administrative Trustees, which
voting rights are vested exclusively in AGL Resources as the holder of the
Common Securities. No resignation or removal of a Property Trustee or a Delaware
Trustee and no appointment of a successor trustee shall be effective until the
acceptance of appointment by the successor trustee in accordance with the
provisions of the Declaration of Trust.
MERGER OR CONSOLIDATION OF TRUSTEES
Any corporation into which the Property Trustee or the Delaware Trustee
may be merged or converted or with which it may be consolidated, or any
corporation resulting from any merger, conversion, or consolidation to which
such Delaware or Property Trustee shall be a party, or any corporation
succeeding to all or substantially all the corporate trust business of such
Delaware or Property Trustee, shall be the successor of such Delaware Trustee or
Property Trustee under the Declaration of Trust, provided such corporation shall
be otherwise qualified and eligible.
MERGERS, CONSOLIDATIONS, AMALGAMATIONS, OR REPLACEMENTS OF THE TRUST
The Trust may not merge with or into, consolidate, amalgamate, or be
replaced by, or convey, transfer, or lease its properties and assets as an
entirety or substantially as an entirety to any corporation or other person or
entity (collectively, where appropriate, a "Person"), except as described below.
The Trust may, at the request of AGL Resources, as Sponsor, with the consent of
the Administrative Trustees but without the consent of the holders of the
Capital Securities, merge with or into, consolidate, amalgamate, or be replaced
by or convey, transfer, or lease its properties and assets as an entirety or
substantially as an entirety to, a trust organized as such under the laws of any
State; provided, that (i) such successor entity either (a) expressly assumes all
of the obligations of the Trust with respect to the Trust Securities or (b)
substitutes for the Trust Securities other securities having substantially the
same terms as the Trust Securities (the "Successor Securities") so long as the
Successor Securities rank the same as the Trust Securities rank in priority with
respect to distributions and payments upon liquidation, redemption, and
otherwise, (ii) AGL Resources expressly appoints a trustee of such successor
entity possessing the same powers and duties as the Property Trustee with
respect to the Junior Subordinated Debentures, (iii) in the case of substitutes
for the Capital Securities, the Successor Securities are listed, or any
Successor Securities will be listed upon notification of issuance, on any
national securities exchange, quotation system, or other organization on which
the Capital Securities are then listed or quoted, if any, (iv) such merger,
consolidation, amalgamation, replacement, conveyance, transfer, or lease does
not cause the Capital Securities (including any Successor Securities) to be
downgraded by any nationally recognized statistical rating organization, (v)
such merger, consolidation, amalgamation, replacement, conveyance, transfer, or
lease does not adversely affect the rights, preferences, and privileges of the
holders of the Capital Securities (including any Successor Securities) in any
material respect, (vi) such successor entity has a purpose identical to that of
the Trust, (vii) prior to such merger, consolidation, amalgamation, replacement,
conveyance, transfer, or lease, AGL Resources has received an opinion from
independent counsel to the Trust experienced in such matters to the effect that
(a) such merger, consolidation, amalgamation, replacement, conveyance, transfer,
or lease does not adversely affect the rights, preferences and privileges of the
holders of the Trust Securities (including any Successor Securities) in any
material respect, and (b) following such merger, consolidation, amalgamation,
replacement, conveyance, transfer, or lease,
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neither the Trust nor such successor entity will be required to register as an
investment company under the Investment Company Act of 1940, as amended (the
"Investment Company Act"), and (viii) AGL Resources or any permitted successor
or assignee owns all of the common securities of such successor entity and
guarantees the obligations of such successor entity under the Successor
Securities at least to the extent provided by the Guarantee. Notwithstanding the
foregoing, the Trust shall not, except with the consent of holders of 100% in
Liquidation Amount of the Trust Securities, consolidate, amalgamate, merge with
or into, or be replaced by, or convey, transfer, or lease its properties and
assets as an entirety or substantially as an entirety to any other entity or
permit any other entity to consolidate, amalgamate, merge with or into, or
replace it if such consolidation, amalgamation, merger, replacement, conveyance,
transfer, or lease would cause the Trust or the successor entity not to be
classified as a grantor trust for United States federal income tax purposes.
VOTING RIGHTS; AMENDMENT OF THE DECLARATION OF TRUST
Except as provided below and under "--Mergers, Consolidations,
Amalgamations, or Replacements of the Trust" and "Description of Exchange
Guarantee--Amendments and Assignment" and as otherwise required by law and the
Declaration of Trust, the holders of the Exchange Capital Securities will have
no voting rights.
The Declaration of Trust may be amended from time to time by the
Delaware Trustee or the Property Trustee, if affected by such amendment, or by
the Administrative Trustees, without the consent of the holders of the Exchange
Capital Securities (i) to cure any ambiguity, correct or supplement any
provisions in the Declaration of Trust that may be inconsistent with any other
provision, or to make any other provisions with respect to matters or questions
arising under the Declaration of Trust, which shall not be inconsistent with the
other provisions of the Declaration of Trust, or (ii) to modify, eliminate or
add to any provisions of the Declaration of Trust to such extent as shall be
necessary to ensure that the Trust will be classified for United States federal
income tax purposes as a grantor trust at all times that any Trust Securities
are outstanding or to ensure that the Trust will not be required to register as
an "investment company" under the Investment Company Act; provided, however,
that such action shall not adversely affect in any material respect the
interests of the holders of the Trust Securities, and any amendments of the
Trust shall become effective when notice thereof is given to the holders of the
Trust Securities. The Declaration of Trust may be amended by the Administrative
Trustees and AGL Resources (i) with the consent of holders representing a
majority (based upon Liquidation Amount) of the outstanding Trust Securities,
and (ii) upon receipt by the Administrative Trustees of an opinion of counsel to
the effect that such amendment or the exercise of any power granted to the
Administrative Trustees in accordance with such amendment will not affect the
Trust's status as a grantor trust for United States federal income tax purposes
or the Trust's exemption from status as an "investment company" under the
Investment Company Act, provided that, without the consent of each holder of
Trust Securities, the Declaration of Trust may not be amended to (i) change the
amount or timing of any Distribution on the Trust Securities or otherwise
adversely affect the amount of any Distribution required to be made in respect
of the Trust Securities as of a specified date or (ii) restrict the right of a
holder of Trust Securities to institute suit for the enforcement of any such
payment on or after such date. The Exchange Capital Securities and any Original
Capital Securities which remain outstanding after consummation of the Exchange
Offer will vote together as a single class for purposes of determining whether
holders of the requisite percentage in outstanding Liquidation Amount thereof
have taken certain actions or exercised certain rights under the Declaration of
Trust.
So long as any Junior Subordinated Debentures are held by the Property
Trustee, the Administrative Trustees shall not (i) direct the time, method, and
place of conducting any proceeding for any remedy available to the Indenture
Trustee, or executing any trust or power conferred on such Property Trustee with
respect to the Junior Subordinated Debentures, (ii) waive certain past defaults
under the Indenture, (iii) exercise any right to rescind or annul a declaration
of acceleration of the maturity of the principal of the Junior Subordinated
Debentures, or (iv) consent to any amendment, modification or termination of the
Indenture or the Junior Subordinated Debentures, where such consent shall be
required, without, in each case, obtaining the prior approval of the holders of
a majority in Liquidation Amount of all outstanding Capital Securities;
provided, however, that where a consent under the Indenture would require the
consent of each holder of Junior Subordinated Debentures affected thereby, no
such consent shall be given by the Property Trustee without the prior approval
of each holder of the Capital Securities. The Administrative Trustees shall not
revoke
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any action previously authorized or approved by a vote of the holders of the
Capital Securities except by subsequent vote of such holders. The Property
Trustee shall notify each holder of Capital Securities of any notice of default
with respect to the Junior Subordinated Debentures. In addition to obtaining the
foregoing approvals of such holders of the Capital Securities, prior to taking
any of the foregoing actions, the Administrative Trustees shall obtain an
opinion of counsel experienced in such matters to the effect that the Trust will
not be classified as an association taxable as a corporation for United States
federal income tax purposes on account of such action.
Any required approval of holders of Capital Securities may be given at
a meeting of such holders convened for such purpose or pursuant to written
consent. The Property Trustee will cause a notice of any meeting at which
holders of Capital Securities are entitled to vote, or of any matter upon which
action by written consent of such holders is to be taken, to be given to each
holder of record of Capital Securities in the manner set forth in the
Declaration of Trust.
No vote or consent of the holders of Capital Securities will be
required for the Trust to redeem and cancel the Capital Securities in accordance
with the Declaration of Trust.
Notwithstanding that holders of the Capital Securities are entitled to
vote or consent under any of the circumstances described above, any of the
Capital Securities that are owned by AGL Resources, the Administrative Trustees
or any affiliate of AGL Resources or any Administrative Trustees, shall, for
purposes of such vote or consent, be treated as if they were not outstanding.
FORM, DENOMINATION, BOOK-ENTRY PROCEDURES AND TRANSFER
The Exchange Capital Securities initially will be represented by one or
more Capital Securities in registered, global form (collectively, the "Global
Capital Securities"). The Global Capital Securities will be deposited upon
issuance with the Property Trustee as custodian for DTC, in New York, New York,
and registered in the name of DTC or its nominee, in each case for credit to an
account of a direct or indirect participant in DTC as described below.
Except as set forth below, the Global Capital Securities may be
transferred, in whole and not in part, only to another nominee of DTC or to a
successor of DTC or its nominee. Beneficial interests in the Global Capital
Securities may not be exchanged for Exchange Capital Securities in certificated
form except in the limited circumstances described below. See "--Exchange of
Book-Entry Capital Securities for Certificated Capital Securities".
DEPOSITARY PROCEDURES
DTC has advised the Trust and AGL Resources that DTC is a
limited-purpose trust company created to hold securities for its participating
organizations (collectively, the "Participants") and to facilitate the clearance
and settlement of transactions in those securities between Participants through
electronic book-entry changes in accounts of its Participants. The Participants
include securities brokers and dealers (including the Initial Purchasers),
banks, trust companies, clearing corporations, and certain other organizations.
Access to DTC's system is also available to other entities such as banks,
brokers, dealers, and trust companies that clear through or maintain a custodial
relationship with a Participant, either directly or indirectly (collectively,
the "Indirect Participants"). Persons who are not Participants may beneficially
own securities held by or on behalf of DTC only through the Participants or the
Indirect Participants. The ownership interest and transfer of ownership interest
of each actual purchaser of each security held by or on behalf of DTC are
recorded on the records of the Participants and Indirect Participants.
DTC has also advised the Trust and AGL Resources that, pursuant to
procedures established by it, (i) upon deposit of the Global Capital Securities,
DTC will credit the accounts of Participants designated by the Initial
Purchasers with portions of the Liquidation Amount of the Global Capital
Securities and (ii) ownership of such interests in the Global Capital Securities
will be shown on, and the transfer of ownership thereof will be effected only
through, records maintained by DTC (with respect to the Participants) or by the
Participants and the Indirect Participants (with respect to other owners of
beneficial interests in the Global Capital Securities).
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Investors in the Global Capital Securities may hold their interests
therein directly through DTC if they are Participants, or indirectly through
organizations which are Participants. All interests in a Global Capital Security
may be subject to the procedures and requirements of DTC. The laws of some
states require that certain Persons take physical delivery in certificated form
of securities that they own. Consequently, the ability to transfer beneficial
interests in a Global Capital Security to such Persons will be limited to that
extent. Because DTC can act only on behalf of Participants, which in turn act on
behalf of Indirect Participants and certain banks, the ability of a Person
having beneficial interests in a Global Capital Security to pledge such
interests to Persons or entities that do not participate in the DTC system, or
otherwise take actions in respect of such interests, may be affected by the lack
of a physical certificate evidencing such interests. For certain other
restrictions on the transferability of the Capital Securities, see "--Exchange
of Book-Entry Capital Securities for Certificated Capital Securities" and
"--Exchange of Certificated Capital Securities for Book-Entry Capital
Securities".
Except as described below, owners of interests in the Global Capital
Securities will not have Exchange Capital Securities registered in their name,
will not receive physical delivery of Exchange Capital Securities in
certificated form and will not be considered the registered owners or holders
thereof under the Declaration of Trust for any purpose.
Payments in respect of the Global Capital Security registered in the
name of DTC or its nominee will be payable by the Property Trustee to DTC in its
capacity as the registered holder under the Declaration of Trust. Under the
terms of the Declaration of Trust, the Property Trustee will treat the Persons
in whose names the Exchange Capital Securities, including the Global Capital
Securities, are registered as the owners thereof for the purpose of receiving
such payments and for any and all other purposes whatsoever. Consequently,
neither the Property Trustee nor any agent thereof has or will have any
responsibility or liability for (i) any aspect of DTC's records or any
Participant's or Indirect Participant's records relating to or payments made on
account of beneficial ownership interests in the Global Capital Securities, or
for maintaining, supervising or reviewing any of DTC's records or any
Participant's or Indirect Participant's records relating to the beneficial
ownership interests in the Global Capital Securities or (ii) any other matter
relating to the actions and practices of DTC or any of its Participants or
Indirect Participants. DTC has advised the Trust and AGL Resources that its
current practice, upon receipt of any payment in respect of securities such as
the Exchange Capital Securities, is to credit the accounts of the relevant
Participants with the payment on the payment date, in amounts proportionate to
their respective holdings in Liquidation Amount of beneficial interests in the
relevant security as shown on the records of DTC unless DTC has reason to
believe it will not receive payment on such payment date. Payments by the
Participants and the Indirect Participants to the beneficial owners of Exchange
Capital Securities will be governed by standing instructions and customary
practices and will be the responsibility of the Participants or the Indirect
Participants and will not be the responsibility of DTC, the Property Trustee,
the Trust or AGL Resources. Neither the Trust or AGL Resources nor the Property
Trustee will be liable for any delay by DTC or any of its Participants in
identifying the beneficial owners of the Exchange Capital Securities, and the
Trust or AGL Resources and the Property Trustee may conclusively rely on and
will be protected in relying on instructions from DTC or its nominee for all
purposes.
Secondary market trading activity in interests in the Global Capital
Securities will settle in immediately available funds, subject in all cases to
the rules and procedures of DTC and its participants. Transfers between
Participants in DTC will be effected in accordance with DTC's procedures, and
will be settled in same-day funds.
DTC has advised the Trust and AGL Resources that it will take any
action permitted to be taken by a holder of Exchange Capital Securities only at
the direction of one or more Participants to whose account with DTC interests in
the Global Capital Securities are credited and only in respect of such portion
of the Liquidation Amount of the Exchange Capital Securities as to which such
Participant or Participants has or have given such direction. However, if there
is an Event of Default under the Declaration of Trust, DTC reserves the right to
exchange the Global Capital Securities for legended Exchange Capital Securities
in certificated form and to distribute such Capital Securities to its
Participants.
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The information in this section concerning DTC and its book-entry
systems has been obtained from sources that the Trust and AGL Resources believe
to be reliable, but neither the Trust nor AGL Resources takes responsibility for
the accuracy thereof.
Although DTC has agreed to the foregoing procedures to facilitate
transfers of interest in the Global Capital Securities among participants in
DTC, they are under no obligation to perform or to continue to perform such
procedures, and such procedures may be discontinued at any time. Neither the
Trust or AGL Resources nor the Property Trustee will have any responsibility for
the performance by DTC or its participants or indirect participants of their
respective obligations under the rules and procedures governing their
operations.
EXCHANGE OF BOOK-ENTRY CAPITAL SECURITIES FOR CERTIFICATED CAPITAL SECURITIES
A Global Capital Security is exchangeable for Exchange Capital
Securities in registered certificated form if (i) DTC notifies the Trust that it
is unwilling or unable to continue as Depositary for the Global Capital Security
and the Trust thereupon fails to appoint a successor Depositary within 90 days
or has ceased to be a clearing agency registered under the Exchange Act, (ii)
AGL Resources in its sole discretion elects to cause the issuance of the
Exchange Capital Securities in certificated form, or (iii) there shall have
occurred and be continuing an Event of Default or any event which after notice
or lapse of time or both would be an Event of Default under the Declaration of
Trust. In addition, beneficial interests in a Global Capital Security may be
exchanged for certificated Exchange Capital Securities upon transfer of such
beneficial interests to institutional accredited investors upon request but only
upon at least 20 days prior written notice given to the Property Trustee by or
on behalf of DTC in accordance with customary procedures. In all cases,
certificated Exchange Capital Securities delivered in exchange for any Global
Capital Security or beneficial interests therein will be registered in the
names, and issued in any approved denominations, requested by or on behalf of
the Depositary (in accordance with its customary procedures).
EXCHANGE OF CERTIFICATED CAPITAL SECURITIES FOR BOOK-ENTRY CAPITAL SECURITIES
Other Capital Securities, which will be issued in certificated form,
may not be exchanged for beneficial interests in any Global Capital Security
unless such exchange occurs in connection with a transfer of such Other Capital
Securities and the transferor first delivers to the Property Trustee a written
certificate (in the form provided in the Declaration of Trust) to the effect
that such transfer will comply with the appropriate transfer restrictions
applicable to such Capital Securities.
PAYMENT AND PAYING AGENCY
Payments in respect of the Exchange Capital Securities held in global
form shall be made to the Depositary, which shall credit the relevant accounts
at the Depositary on the applicable Distribution Dates or in respect of the
Exchange Capital Securities that are not held by the Depositary, such payments
shall be made by check mailed to the address of the holder entitled thereto as
such address shall appear on the register. The paying agent (the "Paying Agent")
shall initially be the Property Trustee and any co-paying agent chosen by the
Property Trustee and acceptable to the Administrative Trustees and AGL
Resources. The Paying Agent shall be permitted to resign as Paying Agent upon 30
days written notice to the Property Trustee and AGL Resources. In the event that
the Property Trustee shall no longer be the Paying Agent, the Administrative
Trustees shall appoint a successor (which shall be a bank or trust company
acceptable to the Administrative Trustees and AGL Resources) to act as Paying
Agent.
RESTRICTIONS ON TRANSFER
The Exchange Capital Securities will be issued, and may be transferred
only, in blocks having a Liquidation Amount of not less than $1,000 (one
Exchange Capital Security) and multiples of $1,000 in excess thereof. Any
transfer, sale or other disposition of Exchange Capital Securities in blocks
having a Liquidation Amount of less than $1,000 shall be deemed to be void and
of no legal effect whatsoever. Any such transferee shall be deemed not to be the
holder of such Exchange Capital Securities for any purpose, including but not
limited to the receipt of Distributions on
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such Exchange Capital Securities, and such transferee shall be deemed to have no
interest whatsoever in such Exchange Capital Securities.
REGISTRAR AND TRANSFER AGENT
The Property Trustee will act as registrar and transfer agent for the
Exchange Capital Securities.
Registration of transfers of the Exchange Capital Securities will be
effected without charge by or on behalf of the Trust, but upon payment of any
tax or other governmental charges that may be imposed in connection with any
transfer or exchange. The Trust will not be required to register or cause to be
registered the transfer of the Exchange Capital Securities after they have been
called for redemption.
INFORMATION CONCERNING THE PROPERTY TRUSTEE
The Property Trustee, other than during the occurrence and continuance
of an Event of Default, undertakes to perform only such duties as are
specifically set forth in the Declaration of Trust and, after such Event of
Default, must exercise the same degree of care and skill as a prudent Person
would exercise or use in the conduct of his or her own affairs. Subject to this
provision, the Property Trustee is under no obligation to exercise any of the
powers vested in it by the Declaration of Trust at the request of any holder of
Trust Securities unless it is offered reasonable indemnity against the costs,
expenses, and liabilities that might be incurred thereby. If no Event of Default
has occurred and is continuing and the Property Trustee is required to decide
between alternative causes of action, construe ambiguous provisions in the
Declaration of Trust or is unsure of the application of any provision of the
Declaration of Trust, and the matter is not one on which holders of the Trust
Securities are entitled under the Declaration of Trust to vote, then the
Property Trustee shall take such action as is directed by AGL Resources and if
not so directed, shall take such action as it deems advisable and in the best
interests of the holders of the Trust Securities and will have no liability
except for its own bad faith, negligence, or willful misconduct.
MISCELLANEOUS
The Administrative Trustees are authorized and directed to conduct the
affairs of and to operate the Trust in such a way that the Trust will not be
deemed to be an "investment company" required to be registered under the
Investment Company Act or classified as an association taxable as a corporation
for United States federal income tax purposes and so that the Junior
Subordinated Debentures will be treated as indebtedness of AGL Resources for
United States federal income tax purposes. In this connection, AGL Resources and
the Administrative Trustees are authorized to take any action, not inconsistent
with applicable law, the certificate of trust of the Trust or the Declaration of
Trust, that AGL Resources and the Administrative Trustees determine in their
discretion to be necessary or desirable for such purposes, as long as such
action does not materially adversely affect the interests of the holders of the
Trust Securities.
Holders of the Trust Securities have no preemptive or similar rights.
The Trust may not borrow money, issue debt, execute mortgages, or
pledge any of its assets.
GOVERNING LAW
The Declaration of Trust will be governed by and construed in
accordance with the laws of the State of Delaware.
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DESCRIPTION OF EXCHANGE JUNIOR SUBORDINATED DEBENTURES
The Original Junior Subordinated Debentures were issued and the
Exchange Junior Subordinated Debentures will be issued under the Indenture, as
supplemented from time to time (as so supplemented, the "Indenture"), between
AGL Resources and the Indenture Trustee. The Indenture has been qualified under
the Trust Indenture Act. This summary of certain terms and provisions of the
Exchange Junior Subordinated Debentures and the Indenture does not purport to be
complete, and where reference is made to particular provisions of the Indenture,
such provisions, including the definitions of certain terms, some of which are
not otherwise defined herein, are qualified in their entirety by reference to
all of the provisions of the Indenture and those terms made a part of the
Indenture by the Trust Indenture Act.
GENERAL
Concurrently with the issuance of the Original Capital Securities, the
Trust invested the proceeds thereof, together with the consideration paid by AGL
Resources for the Common Securities, in the Original Junior Subordinated
Debentures issued by AGL Resources. Like the Original Junior Subordinated
Debentures, the Exchange Junior Subordinated Debentures will bear interest at
the annual rate of 8.17% of the principal amount thereof. Interest on the
Exchange Junior Subordinated Debentures will accumulate from the last day on
which interest was paid on the Original Junior Subordinated Debentures exchanged
for the Exchange Junior Subordinated Debentures, or, if no interest has been
paid, from the Issue Date (June 11, 1997), and will be payable semi-annually in
arrears on June 1 and December 1 of each year (each, an "Interest Payment
Date"), to the Person in whose name each Exchange Junior Subordinated Debenture
is registered, subject to certain exceptions, at the close of business on the
May 15 or November 15 immediately preceding the relevant payment date. It is
anticipated that, until the liquidation, if any, of the Trust, each Exchange
Junior Subordinated Debenture will be held in the name of the Property Trustee
in trust for the benefit of the holders of the Trust Securities. The amount of
interest payable for any period will be computed on the basis of a 360-day year
of twelve 30-day months. In the event that any date on which interest is payable
on the Exchange Junior Subordinated Debentures is not a Business Day, then
payment of the interest payable on such date will be made on the next succeeding
day that is a Business Day (and without any interest or other payment in respect
of any such delay) with the same force and effect as if made on the date such
payment was originally payable. Accrued interest that is not paid on the
applicable Interest Payment Date will bear additional interest on the amount
thereof (to the extent permitted by law) at the rate per annum of 8.17% thereof,
compounded semi-annually. The term "interest", as used herein, shall include
semi-annual interest payments, interest on semi-annual interest payments not
paid on the applicable Interest Payment Date and Additional Sums (as defined
herein), as applicable.
The Exchange Junior Subordinated Debentures will be issued in
denominations of $1,000 and integral multiples thereof. The Exchange Junior
Subordinated Debentures will mature on June 1, 2037 (the "Stated Maturity
Date").
The Exchange Junior Subordinated Debentures will rank pari passu with
the Original Junior Subordinated Debentures and all Other Debentures and will be
unsecured and subordinate and junior in right of payment to the extent and in
the manner set forth in the Indenture to all Senior Indebtedness. See
"--Subordination." AGL Resources is a holding company almost all of the
operating assets of which are owned by its subsidiaries. AGL Resources relies
primarily on dividends from such subsidiaries to meet its obligations. AGL
Resources is a legal entity separate and distinct from its subsidiaries. The
principal sources of AGL Resources' income are dividends and fees from its
subsidiaries. Subject to the preferential rights of the holders of the preferred
stock of AGLC (and AGLC Junior Stock as defined below (if any) ranking as to
dividends ahead of the common stock of AGLC) to receive full cumulative
dividends, both past and current, and the restrictions set forth below, AGL
Resources, as the holder of all of the outstanding shares of the common stock of
AGLC, is entitled to receive such dividends as may be declared by the board of
directors of AGLC out of funds legally available therefor. AGLC's Articles of
Incorporation impose restrictions on the payment of dividends (except a dividend
in common stock of AGLC or in any class of stock ranking junior to the preferred
stock of AGLC as to dividends or assets (the "AGLC Junior Stock")) unless AGLC
attains certain earnings levels or maintains certain capitalization ratios.
Under the most restrictive of these provisions, all of AGLC's retained
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earnings were free of such restrictions and available for the payment of
dividends at June 30, 1997. Retained earnings of AGLC at June 30, 1997 were
$86.0 million.
Because AGL Resources is a holding company, the right of AGL Resources
to participate in any distribution of assets of any subsidiary upon such
subsidiary's liquidation or reorganization or otherwise, is subject to the prior
claims of creditors of the subsidiary, except to the extent AGL Resources may
itself be recognized as a creditor of that subsidiary. Accordingly, the Exchange
Junior Subordinated Debentures will be effectively subordinated to all existing
and future liabilities of AGL Resources' subsidiaries, and holders of Exchange
Junior Subordinated Debentures should look only to the assets of AGL Resources
for payments on the Exchange Junior Subordinated Debentures. The Indenture does
not limit the incurrence or issuance of other secured or unsecured debt of AGL
Resources, including Senior Indebtedness. See "--Subordination."
The Indenture does not contain provisions that afford holders of the
Exchange Junior Subordinated Debentures protection in the event of a highly
leveraged transaction or other similar transactions involving AGL Resources that
may adversely affect such holders.
FORM, REGISTRATION AND TRANSFER
If the Exchange Junior Subordinated Debentures are distributed to the
holders of the Trust Securities, the Exchange Junior Subordinated Debentures may
be represented by one or more global certificates registered in the name of Cede
& Co. as the nominee of DTC. The depositary arrangements for such Exchange
Junior Subordinated Debentures are expected to be substantially similar to those
in effect for the Exchange Capital Securities. For a description of DTC and the
terms of the depositary arrangements relating to payments, transfers, voting
rights, redemptions and other notices and other matters, see "Description of
Exchange Capital Securities--Form, Denomination, Book-Entry Procedures and
Transfer."
PAYMENT AND PAYING AGENTS
Payment of principal of (and premium, if any) and any interest on
Exchange Junior Subordinated Debentures will be made at the office of the
Indenture Trustee in The City of New York or at the office of such Paying Agent
or Paying Agents as AGL Resources may designate from time to time, except that
at the option of AGL Resources payment of any interest may be made except in the
case of Exchange Junior Subordinated Debentures in global form, (i) by check
mailed to the address of the Person entitled thereto as such address shall
appear in the register for Exchange Junior Subordinated Debentures or (ii) by
transfer to an account maintained by the Person entitled thereto as specified in
such register, provided that proper transfer instructions have been received by
the relevant Record Date. Payment of any interest on any Exchange Junior
Subordinated Debenture will be made to the Person in whose name such Exchange
Junior Subordinated Debenture is registered at the close of business on the
Record Date for such interest, except in the case of defaulted interest. AGL
Resources may at any time designate additional Paying Agents or rescind the
designation of any Paying Agent; however AGL Resources will at all times be
required to maintain a Paying Agent in each Place of Payment for the Exchange
Junior Subordinated Debentures.
Any moneys deposited with the Indenture Trustee or any Paying Agent, or
then held by AGL Resources in trust, for the payment of the principal of (and
premium, if any) or interest on any Exchange Junior Subordinated Debenture and
remaining unclaimed for two years after such principal (and premium, if any) or
interest has become due and payable shall, at the request of AGL Resources, be
repaid to AGL Resources and the holder of such Exchange Junior Subordinated
Debenture shall thereafter look, as a general unsecured creditor, only to AGL
Resources for payment thereof.
OPTION TO EXTEND INTEREST PAYMENT DATE
So long as no Debenture Event of Default has occurred and is
continuing, AGL Resources will have the right under the Indenture at any time
during the term of the Exchange Junior Subordinated Debentures to defer the
payment
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of interest at any time or from time to time for a period not exceeding 10
consecutive semi-annual periods with respect to each Extension Period, provided
that no Extension Period may extend beyond the Stated Maturity Date. At the end
of such Extension Period, AGL Resources must pay all interest then accrued and
unpaid (together with interest thereon at the annual rate of 8.17%, compounded
semi-annually, to the extent permitted by applicable law). During an Extension
Period, interest will continue to accrue and holders of Exchange Junior
Subordinated Debentures (and holders of the Trust Securities while Trust
Securities are outstanding) will be required to accrue interest income for
United States federal income tax purposes prior to the receipt of cash
attributable to such income. See "Certain Federal Income Tax Consequences--
Interest Income and Original Issue Discount."
During any such Extension Period, AGL Resources may not (i) declare or
pay any dividends or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of AGL Resources' capital stock (which
includes common and preferred stock) or (ii) make any payment of principal,
interest or premium, if any, on or repay, repurchase, or redeem any debt
securities of AGL Resources (including any Other Debentures) that rank pari
passu with or junior in right of payment to the Exchange Junior Subordinated
Debentures or (iii) make any guarantee payments with respect to any guarantee by
AGL Resources of the debt securities of any subsidiary of AGL Resources
(including any Other Guarantees) if such guarantee ranks pari passu with or
junior in right of payment to the Exchange Junior Subordinated Debentures (other
than (a) dividends or distributions in shares of, or options, warrants, or
rights to subscribe for or purchase shares of, common stock of AGL Resources,
(b) any declaration of a dividend in connection with the implementation of a
stockholders' rights plan, or the issuance of stock under any such plan in the
future, or the redemption or repurchase of any such rights pursuant thereto, (c)
payments under the Guarantee, (d) the purchase of fractional shares resulting
from a reclassification of AGL Resources' capital stock, (e) the exchange or
conversion of one class or series of AGL Resources' capital stock for another
class or series of AGL Resources' capital stock, and (f) the purchase of
fractional interests in shares of AGL Resources' capital stock pursuant to the
conversion or exchange provisions of such capital stock or the security being
converted or exchanged).
Prior to the termination of any such Extension Period, AGL Resources
may further extend such Extension Period, provided that such extension does not
cause such Extension Period to exceed 10 consecutive semi-annual periods or to
extend beyond the Stated Maturity Date. Upon the termination of any such
Extension Period and the payment of all amounts then due on any Interest Payment
Date, AGL Resources may elect to begin a new Extension Period, subject to the
above requirements. No interest shall be due and payable during an Extension
Period, except at the end thereof. AGL Resources must give the Property Trustee,
the Administrative Trustees and the Indenture Trustee notice of its election of
any Extension Period (or an extension thereof) at least five Business Days prior
to the earlier of (i) the date the Distributions on the Trust Securities would
have been payable except for the election to begin or extend such Extension
Period or (ii) the date the Administrative Trustees are required to give notice
to any securities exchange or other quotation system or to holders of Capital
Securities on the record date or the date such Distributions are payable, but in
any event not less than five Business Days prior to such record date. The
Indenture Trustee shall give notice of AGL Resources' election to begin or
extend a new Extension Period to the holders of the Capital Securities. There is
no limitation on the number of times that AGL Resources may elect to begin an
Extension Period.
OPTIONAL PREPAYMENT
The Exchange Junior Subordinated Debentures will be prepayable, in
whole or in part, at the option of AGL Resources on or after June 1, 2007 (the
"Initial Optional Prepayment Date"), at a prepayment price (the "Optional
Prepayment Price") equal to the percentage of the outstanding principal amount
of the Exchange Junior Subordinated Debentures specified below, plus, in each
case, accrued interest thereon to the date of prepayment if redeemed during the
12-month period beginning June 1 of the years indicated below:
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<TABLE>
<CAPTION>
YEAR PERCENTAGE
- ---- ----------
<S> <C>
2007....................................................... 104.085%
2008....................................................... 103.677%
2009....................................................... 103.268%
2010....................................................... 102.860%
2011....................................................... 102.451%
2012....................................................... 102.043%
2013....................................................... 101.634%
2014....................................................... 101.226%
2015....................................................... 100.817%
2016....................................................... 100.409%
2017 and thereafter........................................ 100.000%
</TABLE>
SPECIAL EVENT PREPAYMENT
If a Tax Event or an Investment Company Act Event (each a "Special
Event") shall occur and be continuing, AGL Resources may, at its option, prepay
the Exchange Junior Subordinated Debentures in whole (but not in part) and
thereby cause the mandatory redemption of the Exchange Capital Securities in
whole (but not in part) at any time prior to June 1, 2007 and within 90 days of
the occurrence of such Special Event, at a prepayment price (the "Special Event
Prepayment Price") equal to the greater of (i) 100% of the principal amount of
such Exchange Junior Subordinated Debentures or (ii) the sum, as determined by a
Quotation Agent, of the present values of the principal amount and premium
payable with respect to an optional redemption of Exchange Junior Subordinated
Debentures on June 1, 2007, together with scheduled payments of interest on the
Exchange Junior Subordinated Debentures accruing from the prepayment date to and
including June 1, 2007 discounted to the prepayment date on a semi-annual basis
(assuming a 360-day year consisting of twelve 30-day months) at the Adjusted
Treasury Rate, plus, in each case, accrued interest thereon to the date of
prepayment.
A "Tax Event" means the receipt by AGL Resources and the Trust of an
opinion of counsel experienced in such matters to the effect that, as a result
of 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, or as a result of any
official administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
such pronouncement or decision is announced or made effective on or after the
Issue Date, there is more than an insubstantial risk that (i) the Trust is, or
will be within 90 days of the date of such opinion, subject to United States
federal income tax with respect to all or part of the income received or accrued
on the Junior Subordinated Debentures or the Exchange Debentures, (ii) interest
payable by AGL Resources on the Junior Subordinated Debentures or the Exchange
Debentures is not, or within 90 days of the date of such opinion will not be,
deductible by AGL Resources, in whole or in part, for United States federal
income tax purposes, or (iii) the Trust is, or will be within 90 days of the
date of such opinion, subject to more than a de minimis amount of other taxes,
duties or other governmental charges.
An "Investment Company Act Event" means the receipt by AGL Resources
and the Trust of an opinion of counsel experienced in such matters to the effect
that, as a result of the occurrence of a change in law or regulation or a change
in interpretation or application of law or regulation by any legislative body,
court, governmental agency or regulatory authority, there is more than an
insubstantial risk that the Trust is or will be considered an "investment
company" that is required to be registered under the Investment Company Act,
which change becomes effective on or after the Issue Date.
"Adjusted Treasury Rate" means, with respect to any prepayment date,
the rate per annum equal to (i) the yield, under the heading which represents
the average for the immediately prior week, appearing in the most recently
published statistical release designated "H.15(519)" or any successor
publication which is published weekly by the Federal Reserve
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<PAGE> 52
and which established yields on actively traded United States Treasury
securities adjusted to constant maturity under the caption "Treasury Constant
Maturities," for the maturity date corresponding to the Initial Optional
Prepayment Date (if no maturity date is within three months before or after the
Initial Optional Prepayment Date, yields for the first two published maturities
most closely corresponding to the Initial Optional Prepayment Date shall be
interpolated and the Adjusted Treasury Rate shall be interpolated or
extrapolated from such yields on a straight-line basis, rounding to the nearest
month) or (ii) if such release (or any successor release) is not published
during the week preceding the calculation date or does not contain such yields,
the rate per annum equal to the semi-annual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such prepayment date plus, in either case (A) 1.05% if such
prepayment date occurs on or prior to June 15, 1997 through and including June
1, 1998 and (B) .50% if such prepayment date occurs after June 1, 1998.
"Comparable Treasury Issue" means the United States Treasury security
selected by the Quotation Agent as having a maturity date corresponding to the
Initial Optional Prepayment Date that would be utilized at the time of selection
and in accordance with customary financial practice, in pricing new issues of
corporate debt securities with a maturity date corresponding to the Initial
Optional Prepayment Date. If no United States Treasury security has a maturity
date which is within three months before or after the Initial Optional
Prepayment Date, the two most closely corresponding United States Treasury
securities shall be used as the Comparable Treasury Issue, and the calculation
of the Adjusted Treasury Rate pursuant to clause (ii) of the definition thereof
shall be interpolated or extrapolated on a straight-line basis, rounding to the
nearest month.
"Quotation Agent" means the Reference Treasury Dealer appointed by AGL
Resources. "Reference Treasury Dealer" means: (i) Merrill Lynch Government
Securities, Inc. and its respective successors; provided, however, that if the
foregoing shall cease to be a primary U.S. Government securities dealer in New
York City (a "Primary Treasury Dealer"), AGL Resources shall substitute
therefor another Primary Treasury Dealer; and (ii) any other Primary Treasury
Dealer selected by AGL Resources.
"Comparable Treasury Price" means, with respect to any prepayment date,
(i) the average of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) on the third
Business Day preceding such prepayment date, as set forth in the daily
statistical release (or any successor release) published by the Federal Reserve
Bank of New York and designated "Composite 3:30 p.m. Quotations for U.S.
Government Securities" or (ii) if such release (or any successor release) is not
published or does not contain such prices on such Business Day, (A) the average
of the Reference Treasury Dealer Quotations for such prepayment date, after
excluding the highest and lowest such Reference Treasury Dealer Quotations, or
(B) if the Indenture Trustee obtains fewer than three such Reference Treasury
Dealer Quotations, the average of all such Quotations.
"Reference Treasury Dealer Quotations" means, with respect to each
Reference Treasury Dealer and any prepayment date, the average, as determined by
the Indenture Trustee, of the bid and asked prices for the Comparable Treasury
Issue (expressed in each case as a percentage of its principal amount) quoted in
writing to the Indenture Trustee by such Reference Treasury Dealer at 5:00 p.m.,
New York City time, on the third Business Day preceding such prepayment date.
Notice of any prepayment will be mailed at least 30 days but not more
than 60 days before the redemption date to each holder of Exchange Junior
Subordinated Debentures to be prepaid at its registered address. Unless AGL
Resources defaults in payment of the prepayment price, on and after the
prepayment date interest ceases to accrue on such Exchange Junior Subordinated
Debentures called for prepayment.
If the Trust is required to pay any additional taxes, duties or other
governmental charges as a result of a Tax Event, AGL Resources will pay as
additional amounts on the Junior Subordinated Debentures the Additional Sums.
"Additional Sums" means the additional amounts as may be necessary in order that
the amount of Distributions then due and payable by the Trust on the outstanding
Capital Securities and Common Securities shall not be reduced as a
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result of any additional taxes, duties and other governmental charges to which
the Trust has become subject as a result of a Tax Event.
Neither AGL Resources nor the Trust will be responsible for nor will
AGL Resources or the Trust be required to compensate holders of or investors in
the Exchange Capital Securities (or Exchange Junior Subordinated Debentures that
may be distributed by the Trust) for any withholding taxes that are imposed on
interest payments on the Exchange Junior Subordinated Debentures or on
Distributions with respect to the Exchange Capital Securities.
RESTRICTIONS ON CERTAIN PAYMENTS
AGL Resources will also covenant that it will not, (i) declare or pay
any dividends or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of AGL Resources' capital stock (which
includes common and preferred stock) or (ii) make any payment of principal,
interest or premium, if any, on or repay or repurchase or redeem any debt
securities of AGL Resources (including Other Debentures) that rank pari passu
with or junior in right of payment to the Exchange Junior Subordinated
Debentures or (iii) make any guarantee payments with respect to any guarantee by
AGL Resources of the debt securities of any subsidiary of AGL Resources
(including under Other Guarantees) if such guarantee ranks pari passu or junior
in right of payment to the Exchange Junior Subordinated Debentures (other than
(a) dividends or distributions in shares of, or options, warrants or rights to
subscribe for or purchase shares of, common stock of AGL Resources, (b) any
declaration of a dividend in connection with the implementation of a
stockholder's rights plan, or the issuance of stock under any such plan in the
future, or the redemption or repurchase of any such rights pursuant thereto, (c)
payments under the Guarantee, (d) the purchase of fractional shares resulting
from a reclassification of AGL Resources' capital stock, (e) the exchange or
conversion of one class or series of AGL Resources' capital stock for another
class or series of AGL Resources' s capital stock and (f) the purchase of
fractional interests in shares of AGL Resources' capital stock pursuant to the
conversion or exchange provisions of such capital stock or the security being
converted or exchanged), if at such time (1) there shall have occurred and be
continuing an Event of Default, (2) there shall have occurred and be continuing
a Debenture Event of Default, (3) there shall have occurred and be continuing a
payment default under the Declaration of Trust or the Indenture, (4) if such
Exchange Junior Subordinated Debentures are held by the Trust, AGL Resources
shall be in default with respect to its payment of any obligations under the
Exchange Guarantee, or (5) AGL Resources shall have given notice of its election
of an Extension Period as provided in the Indenture and shall not have rescinded
such notice, and such Extension Period, or any extension thereof, shall have
commenced.
MODIFICATION OF INDENTURE
From time to time AGL Resources and the Indenture Trustee may, without
the consent of the holders of Exchange Junior Subordinated Debentures, amend,
waive or supplement the Indenture for specified purposes, including, among other
things, curing ambiguities, defects or inconsistencies (provided that any such
action does not materially adversely affect the interest of the holders of
Exchange Junior Subordinated Debentures) and qualifying, or maintaining the
qualification of, the Indenture under the Trust Indenture Act. The Indenture
contains provisions permitting AGL Resources and the Indenture Trustee, with the
consent of the holders of a majority in principal amount of Exchange Junior
Subordinated Debentures, to modify the Indenture in a manner affecting the
rights of the holders of Exchange Junior Subordinated Debentures; provided, that
no such modification may, without the consent of the holders of each outstanding
Exchange Junior Subordinated Debenture so affected, (i) extend the Stated
Maturity, or reduce the principal amount of the Exchange Junior Subordinated
Debentures or reduce the rate or extend the time of payment of interest thereon,
or reduce any amount payable on redemption, or impair or affect the right of any
holder of Exchange Junior Subordinated Debentures to institute suit for payment
or (ii) reduce the percentage of principal amount of Exchange Junior
Subordinated Debentures, the holders of which are required to consent to any
such modification of the Indenture.
DEBENTURE EVENTS OF DEFAULT
The Indenture provides that any one or more of the following described
events with respect to the Junior Subordinated Debentures constitutes a
"Debenture Event of Default" (whatever the reason for such Debenture Event
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of Default and whether it shall be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(i) failure for 30 days to pay any interest on the Junior
Subordinated Debentures or any Other Debentures, when due (subject to
the deferral of any due date in the case of an Extension Period); or
(ii) failure to pay any principal or premium, if any, on the
Junior Subordinated Debentures or any Other Debentures when due whether
at maturity, upon redemption, by declaration of acceleration of
maturity or otherwise; or
(iii) failure to observe or perform in any material respect
certain other covenants or warranties contained in the Indenture for 90
days after written notice to AGL Resources from the Indenture Trustee
or the holders of at least 25% in aggregate outstanding principal
amount of Junior Subordinated Debentures; or
(iv) certain events of bankruptcy, insolvency or
reorganization of AGL Resources.
The holders of a majority in aggregate outstanding principal amount of
the Junior Subordinated Debentures have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Indenture
Trustee. The Indenture Trustee or the holders of not less than 25% in aggregate
outstanding principal amount of the Junior Subordinated Debentures may declare
the principal due and payable immediately upon a Debenture Event of Default. The
holders of a majority in aggregate outstanding principal amount of the Junior
Subordinated Debentures may annul such declaration and waive the default if the
default (other than the non-payment of the principal of the Junior Subordinated
Debentures which has become due solely by such acceleration) has been cured,
waived or otherwise remedied and a sum sufficient to pay all matured
installments of interest and principal due otherwise than by acceleration has
been deposited with the Indenture Trustee.
The holders of a majority in aggregate outstanding principal amount of
the Junior Subordinated Debentures affected thereby may, on behalf of the
holders of all the Junior Subordinated Debentures, waive any past default,
except a default in the payment of principal (or premium, if any) on or interest
(unless such default has been cured and a sum sufficient to pay all matured
installments of interest (and premium, if any) and principal due otherwise than
by acceleration has been deposited with the Indenture Trustee) or a default in
respect of a covenant or provision which under the Indenture cannot be modified
or amended without the consent of the holder of each outstanding Junior
Subordinated Debenture.
ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF CAPITAL SECURITIES
If a Debenture Event of Default shall have occurred and be continuing
and shall be attributable to the failure of AGL Resources to pay interest (or
premium, if any) on principal of the Exchange Junior Subordinated Debentures on
the due date, a holder of Exchange Capital Securities may institute a Direct
Action. AGL Resources may not amend the Indenture to remove the foregoing right
to bring a Direct Action without the prior written consent of the holders of all
of the Capital Securities. If the right to bring a Direct Action is removed
following the Exchange Offer, the Trust may become subject to the reporting
obligations under the Exchange Act. Notwithstanding any payments made to a
holder of Capital Securities by AGL Resources in connection with a Direct
Action, AGL Resources shall remain obligated to pay the principal of (or
premium, if any) or interest on the Exchange Junior Subordinated Debentures, and
AGL Resources shall be subrogated to the rights of the holder of such Exchange
Capital Securities with respect to payments on the Exchange Capital Securities
to the extent of any payments made by AGL Resources to such holder in any Direct
Action.
The holders of the Exchange Capital Securities will not be able to
exercise directly any remedies, other than those set forth in the preceding
paragraph, available to the holders of the Exchange Junior Subordinated
Debentures unless there shall have been an Event of Default under the
Declaration of Trust. See "Description of Exchange Capital Securities--Events of
Default; Notice."
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CONSOLIDATION, MERGER, SALE OF ASSETS AND OTHER TRANSACTIONS
The Indenture provides that AGL Resources shall not consolidate with or
merge into any other Person or convey, transfer or lease its properties and
assets as an entirety or substantially as an entirety to any Person, and no
Person shall consolidate with or merge into AGL Resources or convey, transfer or
lease its properties and assets as an entirety or substantially as an entirety
to AGL Resources, unless: (i) in case AGL Resources consolidates with or merges
into another Person or conveys or transfers its properties and assets
substantially as an entirety to any Person, the successor Person is organized
under the laws of the United States or any State or the District of Columbia,
and such successor Person expressly assumes AGL Resources' obligations on the
Exchange Junior Subordinated Debentures; (ii) immediately after giving effect
thereto, no Debenture Event of Default, and no event which, after notice or
lapse of time or both, would become a Debenture Event of Default, shall have
occurred and be continuing; and (iii) certain other conditions as prescribed in
the Indenture are met.
The general provisions of the Indenture do not afford holders of the
Exchange Junior Subordinated Debentures protection in the event of a highly
leveraged or other transaction involving AGL Resources that may adversely affect
holders of the Exchange Junior Subordinated Debentures.
SATISFACTION AND DISCHARGE
The Indenture provides that when, among other things, all Junior
Subordinated Debentures not previously delivered to the Indenture Trustee for
cancellation (i) have become due and payable or (ii) will become due and payable
at maturity within one year, and AGL Resources deposits or causes to be
deposited with the Indenture Trustee funds, in trust, for the purpose and in an
amount sufficient to pay and discharge the entire indebtedness on the Junior
Subordinated Debentures not previously delivered to the Indenture Trustee for
cancellation, for the principal (and premium, if any) and interest to the date
of the deposit or to the Stated Maturity Date, as the case may be, then the
Indenture will cease to be of further effect (except as to AGL Resources'
obligations to pay all other sums due pursuant to the Indenture and to provide
the officers' certificates and opinions of counsel described therein), and AGL
Resources will be deemed to have satisfied and discharged the Indenture.
SUBORDINATION
The Indenture provides that the Exchange Junior Subordinated Debentures
issued thereunder will be subordinate and junior in right of payment to all
Senior Indebtedness. No payment of principal (including redemption payments),
premium, if any, or interest on the Exchange Junior Subordinated Debentures may
be made at any time when (i) any Senior Indebtedness is not paid when due, (ii)
any applicable grace period with respect to such default has ended and such
default has not been cured or waived or ceased to exist, or (iii) the maturity
of any Senior Indebtedness has been accelerated because of a default.
Upon any distribution of assets to creditors upon any liquidation,
dissolution, winding up, reorganization, assignment for the benefit of
creditors, marshaling of assets or any bankruptcy, insolvency, debt
restructuring or similar proceedings in connection with any insolvency or
bankruptcy proceeding of AGL Resources, all Senior Indebtedness must be paid in
full before the holders of the Exchange Junior Subordinated Debentures are
entitled to receive or retain any payment in respect thereof.
In the event of the acceleration of the maturity of Exchange Junior
Subordinated Debentures, the holders of all Senior Indebtedness outstanding at
the time of such acceleration will first be entitled to receive payment in full
before the holders of Exchange Junior Subordinated Debentures will be entitled
to receive or retain any payment in respect of the Exchange Junior Subordinated
Debentures.
"Senior Indebtedness" shall mean all Indebtedness for Money Borrowed,
whether outstanding on the date of execution of the Indenture or thereafter
created, assumed or incurred, unless the terms thereof specifically provide that
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it is not superior in right of payment to the Junior Subordinated Debentures,
and any deferrals, renewals or extensions of such Senior Indebtedness.
"Indebtedness for Money Borrowed" shall mean any obligation of, or any
obligation guaranteed by, AGL Resources for the repayment of borrowed money,
whether or not evidenced by bonds, debentures, notes or other written
instruments, but shall not include (i) any trade accounts payable in the
ordinary course of business, (ii) any such indebtedness that by its terms ranks
pari passu with or junior in right of payment to the Junior Subordinated
Debentures, (iii) all other debt securities, and guarantees in respect of those
debt securities, issued after the Issue Date to any other trust, or a trustee of
such trust, partnership or other entity affiliated with AGL Resources that is a
financing vehicle of AGL Resources (a "financing entity") in connection with the
issuance by such financing entity of equity securities or other securities
guaranteed by AGL Resources pursuant to an instrument that ranks pari passu with
or junior in right of payment to the Guarantee, and (iv) any other indebtedness
that would otherwise qualify as "Indebtedness for Money Borrowed" to the extent
that such indebtedness by its terms ranks pari passu with or junior in right of
payment to any of the indebtedness described in (i), (ii) or (iii).
AGL Resources is a holding company and almost all of the operating
assets of AGL Resources are owned by AGL Resources' subsidiaries. AGL Resources
relies primarily on dividends from such subsidiaries to meet its obligations for
payment of principal and interest on its outstanding debt obligations and
corporate expenses. AGL Resources is a legal entity separate and distinct from
its subsidiaries. The principal sources of AGL Resources' income are dividends
and fees from its subsidiaries. Because AGL Resources is a holding company, the
right of AGL Resources to participate in any distribution of assets of any
subsidiary, upon such subsidiary's liquidation or reorganization or otherwise,
is subject to the prior claims of creditors of the subsidiary. Accordingly, the
Exchange Junior Subordinated Debentures will be effectively subordinated to all
existing and future liabilities of AGL Resources' subsidiaries. Holders of
Exchange Junior Subordinated Debentures should look only to the assets of AGL
Resources for payments of interest and principal and premium, if any.
The Indenture places no limitation on the amount of additional Senior
Indebtedness that may be incurred by AGL Resources. AGL Resources expects from
time to time to incur additional indebtedness constituting Senior Indebtedness.
RESTRICTIONS ON TRANSFER
The Exchange Junior Subordinated Debentures will be issued, and may be
transferred only, in minimum denominations of not less than $1,000 and multiples
of $1,000 in excess thereof. Any such transfer, sale, or other disposition of
Exchange Junior Subordinated Debentures in a denomination of less than $1,000
shall be deemed to be void and of no legal effect whatsoever. Any such
transferee shall be deemed not to be the holder of such Exchange Junior
Subordinated Debentures for any purpose, including but not limited to the
receipt of payments on such Exchange Junior Subordinated Debentures, and such
transferee shall be deemed to have no interest whatsoever in such Exchange
Junior Subordinated Debentures.
GOVERNING LAW
The Indenture and the Exchange Junior Subordinated Debentures will be
governed by and construed in accordance with the laws of the State of New York.
INFORMATION CONCERNING THE INDENTURE TRUSTEE
Following the Exchange Offer and the qualification of the Indenture
under the Trust Indenture Act, the Indenture Trustee shall have and be subject
to all the duties and responsibilities specified with respect to a Indenture
Trustee under the Trust Indenture Act. Subject to such provisions, the Indenture
Trustee is under no obligation to exercise any of the powers vested in it by the
Indenture at the request of any holder of Exchange Junior Subordinated
Debentures, unless offered reasonable indemnity by such holder against the
costs, expenses and liabilities which might
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be incurred thereby. The Indenture Trustee is not required to expend or risk its
own funds or otherwise incur personal financial liability in the performance of
its duties if the Indenture Trustee reasonably believes that repayment or
adequate indemnity is not reasonably assured to it.
MISCELLANEOUS
AGL Resources has agreed, pursuant to the Indenture, for so long as
Trust Securities remain outstanding, (i) to maintain directly or indirectly 100%
ownership of the Common Securities of the Trust (provided that certain
successors which are permitted pursuant to the Indenture may succeed to AGL
Resources' ownership of the Common Securities), (ii) not to voluntarily
terminate, wind up or liquidate the Trust, except in connection with a
distribution of Junior Subordinated Debentures to the holders of the Capital
Securities in liquidation of the Trust, and (iii) to use its reasonable efforts,
consistent with the terms and provisions of the Declaration of Trust to cause
the Trust to remain classified as (a) a business trust, except in connection
with certain mergers, consolidations or amalgamations permitted by the
Declaration of Trust, and (b) a grantor trust and not as an association taxable
as a corporation for United States federal income tax purposes.
DESCRIPTION OF EXCHANGE GUARANTEE
The Exchange Guarantee will be executed and delivered by AGL Resources
concurrently with the issuance by the Trust of the Exchange Capital Securities
for the benefit of the holders from time to time of the Exchange Capital
Securities. The Bank of New York will act as guarantee trustee ("Guarantee
Trustee") under the Exchange Guarantee. The Exchange Guarantee has been
qualified under the Trust Indenture Act. This summary of certain provisions of
the Exchange Guarantee does not purport to be complete and is subject to, and
qualified in its entirety by reference to, all of the provisions of the Exchange
Guarantee, including the definitions therein of certain terms, and the Trust
Indenture Act. The Guarantee Trustee will hold the Exchange Guarantee for the
benefit of the holders of the Exchange Capital Securities.
GENERAL
AGL Resources will irrevocably agree to pay in full on a subordinated
basis, to the extent set forth herein, the Guarantee Payments (as defined
herein) to the holders of the Exchange Capital Securities, as and when due,
regardless of any defense, right of set-off or counterclaim that the Trust may
have or assert other than the defense of payment. The following payments with
respect to the Exchange Capital Securities, to the extent not paid by or on
behalf of the Trust (the "Guarantee Payments"), will be subject to the Exchange
Guarantee: (i) any accumulated and unpaid Distributions required to be paid on
Exchange Capital Securities, to the extent that the Trust has funds on hand
legally available therefor at such time, (ii) the applicable Redemption Price
with respect to Exchange Capital Securities called for redemption, to the extent
that the Trust has funds on hand legally available therefor at such time, or
(iii) upon a voluntary or involuntary termination and liquidation of the Trust,
the lesser of (a) the Liquidation Distribution, to the extent that the Trust has
funds on hand legally available therefor, and (b) the amount of assets of the
Trust remaining available for distribution to holders of Exchange Capital
Securities. AGL Resources' obligation to make a Guarantee Payment may be
satisfied by direct payment of the required amounts by AGL Resources to the
holders of the Exchange Capital Securities or by causing the Trust to pay such
amounts to such holders.
The Exchange Guarantee will rank subordinate and junior in right of
payment to all Senior Indebtedness to the extent provided therein. See "--Status
of the Exchange Guarantee". Because AGL Resources is a holding company, the
right of AGL Resources to participate in any distribution of assets of any
subsidiary upon such subsidiary's liquidation or reorganization or otherwise, is
subject to the prior claims of creditors of that subsidiary, except to the
extent AGL Resources may itself be recognized as a creditor of that subsidiary.
Accordingly, AGL Resources' obligations under the Exchange Guarantee will be
effectively subordinated to all existing and future liabilities of AGL
Resources' subsidiaries, and claimants should look only to the assets of AGL
Resources for payments thereunder. See "Description of the Exchange Junior
Subordinated Debentures--General." The Exchange Guarantee does not limit the
incurrence
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or issuance of other secured or unsecured debt of AGL Resources, including
Senior Indebtedness, whether under the Indenture, any other indenture that AGL
Resources may enter into in the future or otherwise.
AGL Resources will, through the Exchange Guarantee, the Declaration of
Trust, the Exchange Junior Subordinated Debentures and the Indenture, taken
together, fully, irrevocably and unconditionally guarantee all of the Trust's
obligations under the Exchange Capital Securities but will not apply to any
payment of Distributions except to the extent the Trust has funds legally
available therefor. If AGL Resources does not make interest payments on the
Exchange Junior Subordinated Debentures held by the Trust, the Trust will not
pay Distributions on the Exchange Capital Securities and will not have funds
legally available therefor.
STATUS OF THE EXCHANGE GUARANTEE
The Exchange Guarantee will constitute an unsecured obligation of AGL
Resources and will rank subordinate and junior in right of payment to all Senior
Indebtedness in the same manner as Exchange Junior Subordinated Debentures,
except in the case of a bankruptcy or insolvency proceeding in respect of AGL
Resources, in which case the Exchange Guarantee will rank subordinate and junior
in right of payment to all liabilities (other than Other Guarantees) of AGL
Resources.
The Exchange Guarantee will rank pari passu with all Other Guarantees
issued by AGL Resources. The Exchange Guarantee will constitute a guarantee of
payment and not of collection (i.e., the guaranteed party may institute a legal
proceeding directly against AGL Resources to enforce its rights under the
Exchange Guarantee without first instituting a legal proceeding against any
other Person or entity). The Exchange Guarantee will be held for the benefit of
the holders of the Exchange Capital Securities. The Exchange Guarantee will not
be discharged except by payment of the Guarantee Payments in full to the extent
not paid by the Trust or upon distribution to the holders of the Exchange
Capital Securities of the Exchange Junior Subordinated Debentures. The Exchange
Guarantee does not place a limitation on the amount of additional Senior
Indebtedness that may be incurred by AGL Resources. AGL Resources expects from
time to time to incur additional indebtedness constituting Senior Indebtedness.
AMENDMENTS AND ASSIGNMENT
Except with respect to any changes that do not materially adversely
affect the rights of holders of the Exchange Capital Securities (in which case
no vote will be required), the Exchange Guarantee may not be amended without the
prior approval of the holders of a majority of the Liquidation Amount of such
outstanding Exchange Capital Securities. The manner of obtaining any such
approval will be as set forth under "Description of the Exchange Capital
Securities--Voting Rights; Amendment of the Declaration of Trust." All
guarantees and agreements contained in the Exchange Guarantee shall bind the
successors, assigns, receivers, trustees and representatives of AGL Resources
and shall inure to the benefit of the holders of the Exchange Capital Securities
then outstanding.
EVENTS OF DEFAULT
An event of default under the Exchange Guarantee will occur upon the
failure of AGL Resources to perform any of its payment or other obligations
thereunder. The holders of a majority in Liquidation Amount of the Exchange
Capital Securities will have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Guarantee Trustee in
respect of the Exchange Guarantee or to direct the exercise of any trust or
power conferred upon the Guarantee Trustee under the Exchange Guarantee. The
Guarantee Trustee may decline to follow any such direction if (i) it shall
determine that the action so directed would be unjustly prejudicial to the
holders not taking part in such direction or (ii) that the action or proceeding
so directed may not lawfully be taken or would involve the Guarantee Trustee in
personal liability.
Any holder of the Exchange Capital Securities may institute a legal
proceeding directly against AGL Resources to enforce its rights under the
Exchange Guarantee without first instituting a legal proceeding against the
Trust, the Guarantee Trustee or any other Person.
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AGL Resources, as guarantor, will be required to file annually with the
Guarantee Trustee a certificate as to whether or not AGL Resources is in
compliance with all the conditions and covenants applicable to it under the
Exchange Guarantee.
INFORMATION CONCERNING THE GUARANTEE TRUSTEE
The Guarantee Trustee, other than during the occurrence and continuance
of an event of default by AGL Resources in performance of the Exchange
Guarantee, will undertake to perform only such duties as are specifically set
forth in the Exchange Guarantee and, after default with respect to the Exchange
Guarantee, must exercise the same degree of care and skill as a prudent Person
would exercise or use in the conduct of his or her own affairs. Subject to this
provision, the Guarantee Trustee will be under no obligation to exercise any of
the powers vested in it by the Exchange Guarantee at the request of any holder
of the Exchange Capital Securities unless it is offered reasonable indemnity
against the costs, expenses and liabilities that might be incurred thereby.
TERMINATION OF THE EXCHANGE GUARANTEE
The Exchange Guarantee will terminate and be of no further force and
effect upon full payment of the applicable Redemption Price of the Exchange
Capital Securities, upon full payment of the Liquidation Amount payable upon
liquidation of the Trust, or upon distribution of Exchange Junior Subordinated
Debentures to the holders of the Exchange Capital Securities. The Exchange
Guarantee will continue to be effective or will be reinstated, as the case may
be, if at any time any holder of the Exchange Capital Securities must restore
payment of any sums paid under the Exchange Capital Securities or the Exchange
Guarantee.
GOVERNING LAW
The Exchange Guarantee will be governed by and construed in accordance
with the laws of the State of New York.
RELATIONSHIP AMONG THE EXCHANGE CAPITAL SECURITIES, THE
EXCHANGE JUNIOR SUBORDINATED DEBENTURES AND THE EXCHANGE GUARANTEE
FULL AND UNCONDITIONAL GUARANTEE
Payments of Distributions and other amounts due on the Exchange Capital
Securities (to the extent the Trust has funds on hand legally available for the
payment of such Distributions) will be irrevocably guaranteed by AGL Resources
as and to the extent set forth under "Description of Exchange Guarantee." Taken
together, AGL Resources' obligations under the Exchange Junior Subordinated
Debentures, the Indenture, the Declaration of Trust and the Exchange Guarantee
will provide, in the aggregate, a full, irrevocable and unconditional guarantee
of payments of Distributions and other amounts due on the Exchange Capital
Securities. No single document standing alone or operating in conjunction with
fewer than all of the other documents constitutes such guarantee. It is only the
combined operation of these documents that has the effect of providing a full,
irrevocable and unconditional guarantee of the Trust's obligations under the
Exchange Capital Securities. If and to the extent that AGL Resources does not
make the required payments on the Exchange Junior Subordinated Debentures, the
Trust will not have sufficient funds to make the related payments, including
Distributions, on the Exchange Capital Securities. The Exchange Guarantee will
not cover any such payment when the Trust does not have sufficient funds on hand
legally available therefor. In such event, the remedy of a holder of Exchange
Capital Securities is to institute a Direct Action. The obligations of AGL
Resources under the Exchange Guarantee will be subordinate and junior in right
of payment to all Senior Indebtedness.
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SUFFICIENCY OF PAYMENTS
As long as payments of interest and other payments are made when due on
the Exchange Junior Subordinated Debentures, such payments will be sufficient to
cover Distributions and other payments due on the Exchange Capital Securities,
primarily because: (i) the aggregate principal amount or Prepayment Price of the
Exchange Junior Subordinated Debentures will be equal to the sum of the
Liquidation Amount or Redemption Price, as applicable, of the Exchange Capital
Securities and Common Securities; (ii) the interest rate and interest and other
payment dates on the Exchange Junior Subordinated Debentures will match the
Distribution Rate and Distribution and other payment dates for the Trust
Securities; (iii) AGL Resources shall pay for all and any costs, expenses and
liabilities of the Trust except the Trust's obligations to holders of Trust
Securities under such Trust Securities; and (iv) the Declaration of Trust will
provide that the Trust is not authorized to engage in any activity that is not
consistent with the limited purposes thereof.
ENFORCEMENT RIGHTS OF HOLDERS OF EXCHANGE CAPITAL SECURITIES
A holder of any Exchange Capital Security may institute a legal
proceeding directly against AGL Resources to enforce its rights under the
Exchange Guarantee without first instituting a legal proceeding against the
Guarantee Trustee, the Trust or any other Person or entity. A default or event
of default under any Senior Indebtedness would not constitute a default or Event
of Default under the Declaration of Trust. However, in the event of payment
defaults under, or acceleration of, Senior Indebtedness, the subordination
provisions of the Indenture will provide that no payments may be made in respect
of the Exchange Junior Subordinated Debentures until such Senior Indebtedness
has been paid in full or any payment default thereunder has been cured or
waived. Failure to make required payments on Exchange Junior Subordinated
Debentures would constitute an Event of Default under the Declaration of Trust.
LIMITED PURPOSE OF THE TRUST
The Exchange Capital Securities will represent preferred undivided
beneficial interests in the assets of the Trust, and the Trust exists for the
sole purpose of issuing and selling the Trust Securities, using the proceeds
from the sale of the Trust Securities to acquire the Original Junior
Subordinated Debentures and engaging in only those other activities necessary,
advisable or incidental thereto.
RIGHTS UPON TERMINATION
Unless the Junior Subordinated Debentures are distributed to holders of
the Trust Securities, upon any voluntary or involuntary termination and
liquidation of the Trust, the holders of the Trust Securities will be entitled
to receive, out of assets held by the Trust, the Liquidation Distribution in
cash. See "Description of Exchange Capital Securities--Liquidation of the Trust
and Distribution of Junior Subordinated Debentures." Upon any voluntary or
involuntary liquidation or bankruptcy of AGL Resources, the Property Trustee, as
holder of the Exchange Junior Subordinated Debentures, would be a subordinated
creditor of AGL Resources, subordinated in right of payment to all Senior
Indebtedness as set forth in the Indenture, but entitled to receive payment in
full of principal (and premium, if any) and interest, before any stockholders of
AGL Resources receive payments or distributions. Since AGL Resources will be the
guarantor under the Exchange Guarantee and will agree to pay for all costs,
expenses and liabilities of the Trust (other than the Trust's obligations to the
holders of its Trust Securities), the positions of a holder of Exchange Capital
Securities and a holder of Exchange Junior Subordinated Debentures relative to
other creditors and to stockholders of AGL Resources in the event of liquidation
or bankruptcy of AGL Resources are expected to be substantially the same.
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CERTAIN FEDERAL INCOME TAX CONSEQUENCES
GENERAL
In the opinion of Long Aldridge Norman LLP, counsel to AGL Resources
and the Trust ("Tax Counsel"), the following is a summary of certain of the
material United States federal income tax consequences of the purchase,
ownership, and disposition of Capital Securities held as capital assets by a
holder who purchases such Capital Securities upon initial issuance. It does not
deal with special classes of holders such as banks, thrifts, real estate
investment trusts, regulated investment companies, insurance companies, dealers
in securities or currencies, tax-exempt investors, or Persons that will hold the
Capital Securities as a position in a "straddle," as part of a "synthetic
security" or "hedge," as part of a "conversion transaction" or other integrated
investment, or as other than a capital asset. This summary also does not address
the tax consequences to Persons that have a functional currency other than the
U.S. dollar or the tax consequences to shareholders, partners or beneficiaries
of a holder of Capital Securities. Further, it does not include any description
of any alternative minimum tax consequences or the tax laws of any state or
local government or of any foreign government that may be applicable to the
Capital Securities. This summary is based on the Internal Revenue Code of 1986,
as amended (the "Code"), Treasury regulations thereunder, the administrative and
judicial interpretations thereof, as of the date hereof, all of which are
subject to change, possibly on a retroactive basis. Prospective investors
should note that no rulings have been or are expected to be sought from the IRS
with respect to any of these issues and, since an opinion of Tax Counsel is not
binding on the Internal Revenue Service (the "IRS") or the courts, no assurance
can be given that the IRS will not take contrary positions. Moreover, no
assurance can be given that any of the opinions expressed herein will not be
challenged by the IRS or, if challenged, that such a challenge would not be
successful.
EXCHANGE OF CAPITAL SECURITIES
The exchange of Original Securities for Exchange Securities should not
be a taxable event to holders for United States federal income tax purposes.
Since the exchange of Original Securities for Exchange Securities will occur by
operation of the terms of the Original Securities, the Exchange Securities
should not be considered to differ materially in kind or extent from the
Original Securities and, therefore, should not be treated as an "exchange" for
United States Federal income tax purposes. Accordingly, the Exchange Capital
Securities should have the same adjusted issue price as the Original Capital
Securities, and a holder should have the same adjusted tax basis and holding
period in the Exchange Capital Securities as the holder had in the Original
Capital Securities immediately before the exchange. Moreover, a holder which
had acquired Original Capital Securities with either market discount or bond
premium will be treated as holding Exchange Capital Securities with the same
amount of market discount or bond premium and will be required to include such
market discount in or deduct such bond premium from their income in the same
manner as on the Original Capital Securities. Holders are urged to consult
their tax advisors regarding the applicability of the market discount and bond
premium rules.
CLASSIFICATION OF THE JUNIOR SUBORDINATED DEBENTURES
In connection with the issuance of the Original Junior Subordinated
Debentures, Tax Counsel rendered its opinion generally to the effect that, under
then current law and assuming full compliance with the terms of the Indenture
(and certain other documents), and based on certain facts and assumptions
contained in such opinion, the Original Junior Subordinated Debentures will be
classified for United States federal income tax purposes as indebtedness of AGL
Resources.
CLASSIFICATION OF THE TRUST
In connection with the issuance of the Original Capital Securities, Tax
Counsel rendered its opinion generally to the effect that, under then current
law and assuming full compliance with the terms of the Declaration of Trust and
the Indenture (and certain other documents), and based on certain facts and
assumptions contained in such opinion, the Trust will be classified for United
States federal income tax purposes as a grantor trust and not as an association
taxable as a corporation. Accordingly, for United States federal income tax
purposes, each holder of Capital Securities generally
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will be considered the owner of an undivided interest in the Junior Subordinated
Debentures, and each holder will be required to include in its gross income any
interest (or OID accrued) with respect to its allocable share of those Junior
Subordinated Debentures.
INTEREST INCOME AND ORIGINAL ISSUE DISCOUNT
Under recently issued Treasury regulations (the "Regulations")
applicable to debt instruments issued on or after August 13, 1996, a "remote"
contingency that stated interest will not be timely paid will be ignored in
determining whether a debt instrument is issued with OID. AGL Resources believes
that the likelihood of its exercising its option to defer payments of interest
is "remote" since exercising that option would prevent AGL Resources from
declaring dividends on any class of its equity securities. Accordingly, AGL
Resources intends to take the position, based on the advice of Tax Counsel, that
the Junior Subordinated Debentures will not be considered to be issued with OID
and, accordingly, stated interest on the Junior Subordinated Debentures
generally will be taxable to a holder as ordinary income at the time it is paid
or accrued in accordance with such holder's method of accounting.
Under the Regulations, if AGL Resources were to exercise its option to
defer payments of interest, the Junior Subordinated Debentures would at that
time be treated as issued with OID, and all stated interest on the Junior
Subordinated Debentures would thereafter be treated as OID as long as the Junior
Subordinated Debentures remain outstanding. In such event, all of a holder's
taxable interest income with respect to the Junior Subordinated Debentures would
thereafter be accounted for on an economic accrual basis regardless of such
holder's method of tax accounting, and actual distributions of stated interest
would not be reported as taxable income. Consequently, a holder of Capital
Securities would be required to include in gross income OID even though AGL
Resources would not make actual cash payments during an Extension Period.
Moreover, under the Regulations, if the option to defer the payment of interest
was determined not to be "remote", the Junior Subordinated Debentures would be
treated as having been originally issued with OID. In such event, all of a
holder's taxable interest income with respect to the Junior Subordinated
Debentures would be accounted for on an economic accrual basis regardless of
such holder's method of tax accounting, and actual distributions of stated
interest would not be reported as taxable income.
The Regulations have not yet been addressed in any rulings or other
interpretations by the IRS, and it is possible that the IRS could take a
position contrary to Tax Counsel's interpretation herein.
Because income on the Capital Securities will constitute indebtedness
of AGL Resources, corporate holders of the Capital Securities will not be
entitled to a dividends-received deduction with respect to any income
recognized with respect to the Capital Securities.
MARKET DISCOUNT
A purchaser of a Capital Security at a discount from the Liquidation
Amount at maturity of such purchaser's pro rata share of the Junior Subordinated
Debentures acquires such Capital Security with "market discount." However,
market discount with respect to a Capital Security will be considered to be zero
if it is de minimis. Market discount will be de minimis with respect to a
Capital Security if it is less than the product of (i) 0.25% of the adjusted
issue price of the purchaser's pro rata share of the Junior Subordinated
Debentures multiplied by (ii) the number of complete years to maturity of such
Junior Subordinated Debentures after the date of purchase. The purchaser of a
Capital Security with more than a de minimis amount of market discount generally
will be required to treat any gain on the sale, exchange, redemption or other
disposition of all or part of the Capital Securities (or related Junior
Subordinated Debentures) as ordinary income to the extent of accrued (but not
previously taxed) market discount. Market discount generally will accrue ratably
during the period from the date of purchase of such Capital Security to the
maturity date of the Junior Subordinated Debentures, unless the holder
irrevocably elects to accrue such market discount on the basis of a constant
interest rate.
A holder who has acquired a Capital Security at a market discount
generally will be required to defer any deductions of interest expense
attributable to any indebtedness incurred or continued to purchase or carry the
Capital
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Security, to the extent such interest expense exceeds the related interest
income. Any such deferred interest expense generally will be allowable as a
deduction not later than the year in which the related market discount income is
recognized. As an alternative to the inclusion of market discount in income upon
disposition of all or a portion of a Capital Security or the related Junior
Subordinated Debentures (including redemptions thereof), a holder may make an
election (which may not be revoked without the IRS's consent) to include market
discount in income as it accrues on all market discount instruments acquired by
the holder during or after the taxable year for which the election is made.
In that case, the preceding deferral rule for interest expense will not apply.
In lieu of the foregoing treatment of market discount and interest
expense, a holder may elect to treat any market discount (including a de minimis
amount) as OID and accrue such discount on a constant-yield basis in the same
manner as the holder accrues OID.
RECEIPT OF JUNIOR SUBORDINATED DEBENTURES OR CASH UPON LIQUIDATION OF THE TRUST
AGL Resources will have the right at any time to liquidate the Trust
and cause the Junior Subordinated Debentures to be distributed to the holders of
the Trust Securities. Under current law, such a distribution, for United States
federal income tax purposes, would be treated as a nontaxable event to each
holder, and each holder would receive an aggregate tax basis in the Junior
Subordinated Debentures equal to such holder's aggregate tax basis in its
Capital Securities. A holder's holding period in the Junior Subordinated
Debentures so received in liquidation of the Trust would include the period
during which the Capital Securities were held by such holder. If, however, the
Trust is characterized for United States federal income tax purposes as an
association taxable as a corporation at the time of its dissolution, the
distribution of the Junior Subordinated Debentures may constitute a taxable
event to holders of Capital Securities and a holder's holding period in Junior
Subordinated Debentures would begin on the date such Junior Subordinated
Debentures were received.
Under certain circumstances described herein (see "Description of
Exchange Capital Securities"), the Junior Subordinated Debentures may be
redeemed for cash and the proceeds of such redemption distributed to holders in
redemption of their Capital Securities. Under current law, such a redemption
would, for United States federal income tax purposes, constitute a taxable
disposition of the redeemed Capital Securities, and a holder could recognize
gain or loss as if it sold such redeemed Capital Securities for cash. See
"--Sales of Capital Securities."
SALES OF CAPITAL SECURITIES
A holder that sells Capital Securities will recognize gain or loss
equal to the difference between its adjusted tax basis in the Capital Securities
and the amount realized on the sale of such Capital Securities (other than with
respect to accrued and unpaid interest which has not yet been included in
income, which will be treated as ordinary income). A holder's adjusted tax basis
in the Capital Securities generally will be its initial purchase price increased
by OID (if any) previously includable in such holder's gross income to the date
of disposition and decreased by payments (if any) received on the Capital
Securities in respect of OID.
The Taxpayer Relief Act of 1997, which was signed into law by
President Clinton on August 5, 1997, made certain changes in the taxation of
individuals on long-term capital gains. Generally, for the tax years ending
after May 6, 1997, the maximum tax rate on net capital gains has been reduced
from 28% to 20% and the rate for individuals that previously paid a 15% tax on
capital gains has been reduced from 15% to 10%. From May 7, 1997 to July 28,
1997, the lower rates apply to assets held for more than 12 months, and
effective July 29, 1997, the lower rates apply to assets held longer than 18
months. The Taxpayer Relief Act of 1997 also made changes in amount of net
capital gain taken into account in computing alternative minimum tax for
corporations. Holders are urged to consult their tax advisors regarding the
applicability of the changes in the treatment of capital gains made by the
Taxpayer Relief Act of 1997.
The Capital Securities may trade at a price that does not accurately
reflect the value of accrued but unpaid interest with respect to the underlying
Junior Subordinated Debentures. A holder who uses the accrual method of
accounting for tax purposes (and a cash method holder, if the Junior
Subordinated Debentures are deemed to have been issued with OID) who disposes of
his Capital Securities between record dates for payments of distributions
thereon will be required to include accrued but unpaid interest on the Junior
Subordinated Debentures through the date of disposition in income as ordinary
income (i.e., interest or, possibly, OID), and to add such amount to his
adjusted tax basis in his pro rata share of the underlying Junior Subordinated
Debentures deemed disposed of. To the extent the selling price is less than the
holder's adjusted tax basis (which will include all accrued but unpaid interest)
a holder will recognize a capital loss. Subject to certain limited exceptions,
capital losses cannot be applied to offset ordinary income for United States
federal income tax purposes.
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POSSIBLE TAX LEGISLATION
On March 19, 1996, President Clinton proposed certain tax law changes
that would, among other things, generally deny corporate issuers a deduction for
interest in respect of certain debt obligations issued on or after December 7,
1995 (the "1996 Proposed Legislation") if such debt obligations have (i) a
weighted average maturity in excess of 40 years, or (ii) a maximum term in
excess of 20 years and are not shown as indebtedness on the issuer's applicable
consolidated balance sheet. Neither the 1996 Proposed Legislation nor similar
legislation was enacted during the 104th Congress. On February 6, 1997,
President Clinton proposed in the administration's fiscal year 1998 budget
certain new tax changes (the "1997 Proposed Legislation") that would, among
other things, generally deny corporate issuers a deduction for interest or OID
in respect of certain debt obligations if such debt obligations have a maximum
term in excess of 15 years and are not shown as indebtedness on the issuer's
applicable consolidated balance sheet. On August 5, 1997, President Clinton
signed the Taxpayer Relief Act of 1997, which enacted into law certain
provisions of the 1997 Proposed Legislation. The Taxpayer Relief Act of 1997
does not contain any provision that would affect AGL Resources' ability to
deduct interest payable on the Junior Subordinated Debentures. However, there
can be no assurance that other legislation enacted after the date hereof will
not adversely affect the ability of AGL Resources to deduct the interest
payable on the Junior Subordinated Debentures. There can be no assurance,
therefore, that a Tax Event will not occur. A Tax Event would permit AGL
Resources to cause a redemption of the Capital Securities before June 1, 2007.
UNITED STATES ALIEN HOLDERS
For purposes of this discussion, a "United States Alien Holder" is any
corporation, individual, partnership, estate, or trust that is not a U.S. Holder
for United States federal income tax purposes. A "U.S. Holder" is a holder of
Capital Securities who or which is a citizen or individual resident (or is
treated as a citizen or individual resident) of the United States for federal
income tax purposes, a corporation or partnership created or organized (or
treated as created or organized for federal income tax purposes) in or under the
laws of the United States or any political subdivision thereof, an estate the
income of which is includible in its gross income for federal income tax
purposes without regard to its source, or a trust if, and only if, (i) a court
within the United States is able to exercise primary supervision over the
administration of the trust and (ii) one or more United States trustees have the
authority to control all substantial decisions of the trust. Under present
United States federal income tax laws: (i) payments by the Trust or any of its
paying agents to any holder of a Capital Security who or which is a United
States Alien Holder will not be subject to United States federal withholding
tax; provided that, (a) the beneficial owner of the Capital Security does not
actually or constructively own 10 percent or more of the total combined voting
power of all classes of stock of AGL Resources entitled to vote, (b) the
beneficial owner of the Capital Security is not a controlled foreign corporation
that is related to AGL Resources through stock ownership, and (c) either (A) the
beneficial owner of the Capital Security certifies to the Trust or its agent,
under penalties of perjury, that it is not a United States holder and provides
its name and address or (B) a securities clearing organization, bank or other
financial institution that holds customers' securities in the ordinary course of
its trade or business (a "Financial Institution"), and holds the Capital
Security in such capacity, certifies to the Trust or its agent, under penalties
of perjury, that such statement has been received from the beneficial owner by
it or by a Financial Institution between it and the beneficial owner and
furnishes the Trust or its agent with a copy thereof; and (ii) a United States
Alien Holder of a Capital Security will not be subject to United States federal
withholding tax on any gain realized upon the sale or other disposition of a
Capital Security.
INFORMATION REPORTING TO HOLDERS
Generally, income on the Capital Securities will be reported to holders
on Forms 1099, which forms should be mailed to holders of Capital Securities by
January 31 following each calendar year.
BACKUP WITHHOLDING
Payments made on, and proceeds from the sale of, the Capital Securities
may be subject to a "backup" withholding tax of 31 percent unless the holder
complies with certain identification requirements. Any withheld amounts
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will be allowed as a credit against the holder's United States federal income
tax, provided the required information is provided to the IRS.
THE UNITED STATES FEDERAL INCOME TAX DISCUSSION SET FORTH ABOVE IS
INCLUDED FOR GENERAL INFORMATION ONLY AND MAY NOT BE APPLICABLE DEPENDING UPON A
HOLDER'S PARTICULAR SITUATION. HOLDERS SHOULD CONSULT THEIR TAX ADVISORS WITH
RESPECT TO THE TAX CONSEQUENCES TO THEM OF THE PURCHASE, OWNERSHIP AND
DISPOSITION OF THE CAPITAL SECURITIES, INCLUDING THE TAX CONSEQUENCES UNDER
STATE, LOCAL, FOREIGN AND OTHER TAX LAWS AND THE POSSIBLE EFFECTS OF CHANGES IN
UNITED STATES FEDERAL OR OTHER TAX LAWS.
ERISA CONSIDERATIONS
Each of AGL Resources (the obligor with respect to the Exchange Junior
Subordinated Debentures held by the Trust) and its affiliates and the Property
Trustee may be considered a "party in interest" (within the meaning of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA")) or a
"disqualified Person" (within the meaning of Section 4975 of the Code) with
respect to many employee benefit plans ("Plans") that are subject to ERISA. Any
purchaser proposing to acquire Exchange Capital Securities with assets of any
Plan should consult with its counsel. The purchase and/or holding of Exchange
Capital Securities by a Plan that is subject to the fiduciary responsibility
provisions of ERISA or the prohibited transaction provisions of Section 4975 of
the Code (including individual retirement arrangements and other plans described
in Section 4975(e)(1) of the Code) and with respect to which AGL Resources, the
Property Trustee or any affiliate is a service provider (or otherwise is a party
in interest or a disqualified Person) may constitute or result in a prohibited
transaction under ERISA or Section 4975 of the Code, unless such Exchange
Capital Securities are acquired pursuant to and in accordance with an applicable
exemption, such as Prohibited Transaction Class Exemption ("PTCE") 84-14 (an
exemption for certain transactions determined by an independent qualified
professional asset manager), PTCE 91-38 (an exemption for certain transactions
involving bank collective investment funds), PTCE 90-1 (an exemption for certain
transactions involving insurance company pooled separate accounts), PTCE 95-60
(an exemption for transactions involving certain insurance company general
accounts), or PTCE 96-23 (an exemption for certain transactions determined by an
in-house asset manager). In addition, a Plan fiduciary considering the purchase
of Exchange Capital Securities should be aware that the assets of the Trust may
be considered "plan assets" for ERISA purposes. In such event, service providers
with respect to the assets of the Trust may become parties in interest or
disqualified Persons with respect to investing Plans, and any discretionary
authority exercised with respect to the Exchange Junior Subordinated Debentures
by such Persons could be deemed to constitute a prohibited transaction under
ERISA or the Code. In order to avoid such prohibited transactions, each
investing Plan, by purchasing the Exchange Capital Securities, will be deemed to
have directed the Trust to invest in the Exchange Junior Subordinated Debentures
and to have appointed the Property Trustee.
PLAN OF DISTRIBUTION
Each broker-dealer that receives Exchange Capital Securities for its
own account pursuant to the Exchange Offer must acknowledge that it will deliver
a prospectus in connection with any resale of such Exchange Capital Securities.
This Prospectus, as it may be amended or supplemented from time to time, may be
used by a broker-dealer in connection with resales of Exchange Capital
Securities received in exchange for Original Capital Securities where such
Original Capital Securities were acquired by such broker-dealer as a result of
market-making activities or other trading activities. The Trust and AGL
Resources have agreed that, starting on the Expiration Date and ending on the
close of business on the 180th day following the Expiration Date, or, if
earlier, when all such Exchange Capital Securities have been disposed of by such
broker-dealer, it will make this Prospectus, as amended or supplemented,
available to any broker-dealer for use in connection with any such resale. In
addition, until _________, 1997, all dealers effecting transactions in the
Exchange Capital Securities may be required to deliver a prospectus.
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The Trust and AGL Resources will not receive any proceeds from any sale
of Exchange Capital Securities by broker-dealers. Exchange Capital Securities
received by broker-dealers for their own account pursuant to the Exchange Offer
may be sold from time to time in one or more transactions, in the
over-the-counter market, in negotiated transactions, through the writing of
options on the Exchange Capital Securities or a combination of such methods of
resale, at market prices prevailing at the time of resale, at prices related to
such prevailing market prices or at negotiated prices. Any such resale may be
made directly to purchasers or to or through brokers or dealers who may receive
compensation in the form of commissions or concessions from any such
broker-dealer and/or the purchasers of any such Exchange Capital Securities. Any
broker-dealer that resells Exchange Capital Securities that were received by it
for its own account pursuant to the Exchange Offer and any broker or dealer that
participates in a distribution of such Exchange Capital Securities may be deemed
to be an "underwriter" within the meaning of the Securities Act and any profit
of any such resale of Exchange Capital Securities and any commissions or
concessions received by any such Persons may be deemed to be underwriting
compensation under the Securities Act. The Letter of Transmittal states that by
acknowledging that it will deliver and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act.
Until 180 days after the Expiration Date or upon such earlier date as
described above, the Trust and the Company will promptly send additional copies
of this Prospectus and any amendment or supplement to this Prospectus to any
broker-dealer that requests such documents in the Letter of Transmittal. The
Trust and the Company have agreed to pay all expenses incident to the Exchange
Offer other than commissions or concessions of any brokers or dealers and will
indemnify the holders of the Capital Securities (including any broker-dealers)
against certain liabilities, including liabilities under the Securities Act.
VALIDITY OF SECURITIES
Certain matters of Delaware law relating to the validity of the
Exchange Capital Securities will be passed upon by Richards, Layton & Finger,
Wilmington, Delaware, special Delaware counsel to AGL Resources and the Trust.
The validity of the Junior Subordinated Debentures and the Guarantee and certain
matters relating thereto will be passed upon on behalf of AGL Resources by Long
Aldridge Norman LLP, Atlanta, Georgia. Long Aldridge Norman LLP will also pass
upon certain matters relating to United States federal income tax
considerations.
EXPERTS
The consolidated financial statements and the related financial
statement schedule incorporated in this prospectus by reference from AGL
Resources Inc.'s Annual Report on Form 10-K for the year ended September 30,
1996 have been audited by Deloitte & Touche LLP, independent auditors, as stated
in their reports, which are incorporated herein by reference, and have been so
incorporated in reliance upon the reports of such firm given upon their
authority as experts in accounting and auditing.
63
<PAGE> 67
<TABLE>
===================================================== ========================================================
<S> <C>
NO DEALER, SALESMAN OR ANY OTHER INDIVIDUAL HAS
BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE
ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR $75,000,000
INCORPORATED BY REFERENCE IN THIS PROSPECTUS IN
CONNECTION WITH THE OFFER MADE BY THIS PROSPECTUS
AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING AGL CAPITAL TRUST
BEEN AUTHORIZED BY AGL RESOURCES, THE TRUST, THE
INITIAL PURCHASERS OR ANY OF THEIR RESPECTIVE AGENTS.
NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE
MADE HEREUNDER SHALL UNDER ANY CIRCUMSTANCE Offer to Exchange its
CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE 8.17% Series B Capital Securities
IN THE AFFAIRS OF AGL RESOURCES OR THE TRUST SINCE (Liquidation Amount $1,000 per Capital Security)
THE DATE HEREOF. THIS PROSPECTUS DOES NOT CONSTITUTE which have been registered under the
AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY Securities Act of 1933 for any and all of its
ANY SECURITIES BY ANYONE IN ANY JURISDICTION IN WHICH 8.17% Series A Capital Securities
SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN (Liquidation Amount $1,000 per Capital
WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION Security)
IS NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS fully and unconditionally guaranteed,
UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. as described herein, by
--------
TABLE OF CONTENTS AGL RESOURCES INC.
PAGE
----
Available Information ............................... 7
Incorporation of Certain Information by
Reference ......................................... 7 --------
Summary ............................................. 8
Risk Factors ........................................ 15 PROSPECTUS
AGL Resources Inc. .................................. 19
Use of Proceeds ..................................... 21 --------
Summary Consolidated Financial Data.................. 22
AGL Capital Trust ................................... 23
The Exchange Offer................................... 23
Description of Exchange Securities................... 34
Description of Exchange Capital Securities........... 34
Description of Exchange Junior Subordinated
Debentures......................................... 45
Description of Exchange Guarantee.................... 54
Relationship Among the Exchange Capital Securities,
the Exchange Junior Subordinated Debentures and
the Exchange Guarantee ............................ 56 __________, 1997
Certain Federal Income Tax Consequences.............. 58
ERISA Considerations................................. 62
Plan of Distribution................................. 62
Validity of Securities............................... 63
Experts.............................................. 63
===================================================== ========================================================
</TABLE>
<PAGE> 68
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 14-2-202(b)(4) of the Georgia Business Corporation Code (the
"Georgia Code") provides that a corporation's Articles of Incorporation may
include a provision that eliminates or limits the personal liability of
directors for monetary damages to the corporation or its shareholders for breach
of their duty of care and other duties as directors; provided, however, that the
Section does not permit a corporation to eliminate or limit the liability of a
director for appropriating, in violation of his duties, any business opportunity
of the corporation, engaging in intentional misconduct or a knowing violation of
law, obtaining an improper personal benefit, or voting for or assenting to an
unlawful distribution (whether as a dividend, stock repurchase or redemption or
otherwise) as provided in Section 14-2-832 of the Georgia Code. Section
14-2-202(b)(4) also does not eliminate or limit the rights of a corporation or
any shareholder to seek an injunction or other non-monetary relief in the event
of a breach of a director's fiduciary duty. In addition, Section 14-2-202(b)(4)
applies only to claims against a director arising out of his role as a director
and does not relieve a director from liability arising from his role as an
officer or in any other capacity. The provisions of Article VII of AGL
Resources' Articles of Amendment and Restatement (the "Articles") are similar in
all substantive respects to those contained in Section 14-2-202(b)(4) of the
Georgia Code outlined above, and Article VII provides that the liability of
directors of AGL Resources shall be limited to the fullest extent permitted by
amendments to Georgia law.
Sections 14-2-850 to 14-2-859, inclusive, of the Georgia Code govern
the indemnification of directors, officers, employees and agents. Section
14-2-851 of the Georgia Code provides for indemnification of a director of AGL
Resources for liability incurred by him in connection with any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (including civil actions brought as derivative
actions by or in the right of AGL Resources) in which he may become involved by
reason of being a director of AGL Resources. Section 14-2-851 also provides such
indemnity for directors who, at the request of AGL Resources, act as directors,
officers, partners, trustees, employees or agents of another foreign or domestic
corporation, partnership, joint venture, trust, employee benefit plan or another
enterprise. The Section permits indemnification if the director acted in a
manner he believed in good faith to be in or not opposed to the best interest of
AGL Resources and, in addition, in criminal proceedings, if he had no reasonable
cause to believe his conduct was unlawful. If the required standard of conduct
is met, indemnification may include judgments, settlements, penalties, fines or
reasonable expenses (including attorneys' fees) incurred with respect to a
proceeding. However, if the director is adjudged liable to AGL Resources in a
derivative action or on the basis that personal benefit was improperly received
by him, the director will only be entitled to such indemnification for
reasonable expenses as a court finds to be proper in accordance with the
provisions of Section 14-2-854.
Section 14-2-852 of the Georgia Code provides that directors who are
successful with respect to any claim brought against them, which claim is
brought because they are or were directors of AGL Resources, are entitled to
indemnification against reasonable expenses as of right. Conversely, if the
charges made in any action are sustained, the determination of whether the
required standard of conduct has been met will be made, in accordance with the
provisions of Section 14-2-855 of the Georgia Code, as follows: (i) by the
majority vote of a quorum of the disinterested members of the board of
directors, (ii) if a quorum cannot be obtained, by a committee thereof duly
designated by the board of directors, consisting of two or more disinterested
directors, (iii) by special legal counsel, or (iv) by the shareholders, but, in
such event, the shares owned by or voted under the control of directors seeking
indemnification may not be voted.
Section 14-2-857 of the Georgia Code provides that an officer of AGL
Resources (but not an employee or agent generally) who is not a director has the
mandatory right of indemnification granted to directors under Section 14-2-852,
as described above. In addition, AGL Resources may, as provided by its Articles,
Bylaws, general or specific actions
II-1
<PAGE> 69
by its Board of Directors, or by contract, indemnify and advance expenses to an
officer, employee or agent who is not a director to the extent that such
indemnification is consistent with public policy.
The provisions of Article IX of AGL Resources' Articles provide for
indemnification by AGL Resources to the full extent permitted by, and the
provisions of Section 2.15 of AGL Resources' Bylaws are similar in all
substantive respects to, the foregoing provisions of the Georgia Code outlined
above.
Officers and directors of AGL Resources are presently covered by
insurance which (with certain exceptions and within certain limitations)
indemnifies them against any losses or liabilities arising from any alleged
"wrongful act" including any alleged breach of duty, neglect, error,
misstatement, misleading statement, omissions or other act done or wrongfully
attempted. The cost of such insurance is borne by AGL Resources as permitted by
the Bylaws of AGL Resources and the laws of the State of Georgia.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
Reference is made to the Exhibit Index on Page II-3 filed as
part of this Registration Statement.
ITEM 22. UNDERTAKINGS.
Each of the undersigned Registrants hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933, as
amended, each filing of a Registrant's annual report pursuant to Section 13(a)
or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to Section
15(d) of the Securities Exchange Act of 1934) that is incorporated by reference
in this Registration Statement shall be deemed to be a new registration
statement relating to the securities offered herein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling Persons of
each undersigned Registrant pursuant to the provisions, or otherwise, each
Registrant has been advised that in the option of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by each undersigned Registrant
of expenses incurred or paid by a director, officer or controlling Person of
each Registrant in the successful defense of any action, suit, or proceeding) is
asserted by such director, officer, or controlling Person in connection with the
securities being registered, each Registrant will, unless in the opinion of its
counsel the matter has been settled by the controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Act and will be governed by the
final adjudication of such issue.
The undersigned Registrants hereby undertake to respond to requests for
information that is incorporated by reference into the Prospectus pursuant to
Item 4, 10(b), 11, or 13 of this Form, within one business day of receipt of
such request, and to send the incorporated documents by first class mail or
other equally prompt means. This includes information contained in documents
filed subsequent to the effective date of the registration statement through the
date of responding to the request.
The undersigned Registrants hereby undertake to supply by means of a
post-effective amendment all information concerning a transaction, and AGL
Resources being acquired or involved therein, that was not the subject of and
included in the registration statement when it became effective.
II-2
<PAGE> 70
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
EXHIBITS
4.1 Indenture of AGL Resources Inc. relating to the Junior Subordinated
Debentures
4.2 Form of Certificate of Exchange Junior Subordinated Debentures
(included as Exhibit A to Exhibit 4.1)
4.3 Certificate of Trust of AGL Capital Trust
4.4 Amended and Restated Declaration of Trust of AGL Capital Trust
4.5 Form of Exchange Capital Security Certificate for AGL Capital Trust
(included as Exhibit A-1 to Exhibit 4.4)
4.6 Series A Capital Securities Guarantee Agreement of AGL Resources Inc.
4.7 Form of Series B Capital Securities Guarantee Agreement of AGL
Resources Inc.
4.8 Registration Rights Agreement
5.1 Opinion of Long Aldridge & Norman LLP to AGL Resources Inc. as to
legality of the Exchange Junior
Subordinated Debentures and the Exchange Guarantee to be issued by AGL
Resources Inc.
5.2 Opinion of Richards, Layton & Finger, special Delaware counsel, as to
legality of the Exchange Capital Securities to be issued by AGL Capital
Trust
8 Opinion of Long Aldridge & Norman LLP as to certain federal income tax
matters
12 Computation of ratio of earnings to fixed charges (excluding interest
on deposits)
23.1 Consent of Deloitte & Touche LLP
23.2 Consent of Long Aldridge & Norman LLP (included in Exhibit 5.1)
23.3 Consent of Richards, Layton & Finger (included in Exhibit 5.2)
23.4 Consent of Long Aldridge & Norman LLP (included in Exhibit 8)
24 Power of Attorney of certain officers and directors of AGL Resources
Inc. (included on signature page to registration statement)
25.1 Form T-1 Statement of Eligibility of The Bank of New York to act as
trustee under the Indenture
25.2 Form T-1 Statement of Eligibility of The Bank of New York to act as
Property Trustee under the Amended and Restated Declaration of Trust of
AGL Capital Trust
25.3 Form T-1 Statement of Eligibility of The Bank of New York under the
Exchange Guarantee for the benefit of the holders of Exchange Capital
Securities of AGL Capital Trust
99.1 Form of Letter of Transmittal
99.2 Form of Notice of Guaranteed Delivery
99.3 Form of Exchange Agent Agreement
II-3
<PAGE> 71
SIGNATURES
Pursuant to the requirements of the Securities Act, AGL Resources Inc.
has duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Atlanta, in the State of
Georgia, on the 27th day of August, 1997.
AGL RESOURCES INC.
By:/s/ David R. Jones
-----------------------
David R. Jones
President and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints David R. Jones and J. Michael
Riley, and each of them, his or her true and lawful attorneys-in-fact and
agents, with full power of substitution and resubstitution, for and in his or
her name, place and stead, in any and all capacities, to sign any and all
amendments (including post-effective amendments) to this Registration Statement,
and to file the same with all exhibits thereto, and all other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite or necessary to be done,
as fully for all intents and purposes as he or she might or could do in person,
hereby ratifying and confirming that said attorneys-in-fact and agents, or any
of them, or their substitute or substitutes, may lawfully do or cause to be done
by virtue hereof.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON THE 27th DAY OF AUGUST, 1997.
<TABLE>
<CAPTION>
SIGNATURES TITLE
- ---------- -----
<S> <C>
/s/ David R. Jones President and Chief Executive Officer
- ------------------ (Principal Executive Officer) and Director
David R. Jones
/s/ J. Michael Riley Vice President and Chief Financial Officer
- -------------------- (Principal Accounting and Financial Officer)
J. Michael Riley
/s/ Frank Barron, Jr. Director
- --------------------
Frank Barron, Jr.
Director
- --------------------
W. Waldo Bradley
/s/ Otis A. Brumby, Jr. Director
- --------------------
Otis A. Brumby, Jr.
</TABLE>
II-4
<PAGE> 72
<TABLE>
<S> <C>
/s/ L.L. Gellerstedt, III Director
- ----------------------------
L.L. Gellerstedt, III
/s/ Albert G. Norman, Jr. Director
- ----------------------------
Albert G. Norman, Jr.
/s/ D. Raymond Riddle Director
- ----------------------------
D. Raymond Riddle
/s/ Betty L. Siegel Director
- ----------------------------
Betty L. Siegel
/s/ Ben J. Tarbutton, Jr. Director
- ----------------------------
Ben J. Tarbutton, Jr.
/s/ Charles McKenzie Taylor Director
- ----------------------------
Charles McKenzie Taylor
/s/ Felker W. Ward, Jr. Director
- ----------------------------
Felker W. Ward, Jr.
</TABLE>
Pursuant to the requirements of the Securities Act, AGL Capital Trust has
duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Atlanta, in the State of
Georgia, on the 27th day of August, 1997.
AGL Capital Trust
By: AGL Resources Inc., Sponsor
By:/s/ J. Michael Riley
----------------------------------------------
J. Michael Riley
Vice President and Chief Financial Officer
II-5
<PAGE> 1
EXHIBIT 4.1
===============================================================================
------------------------------
AGL RESOURCES INC.
------------------------------
INDENTURE
DATED AS OF JUNE 11, 1997
------------------------------
THE BANK OF NEW YORK
AS TRUSTEE
------------------------------
8.17% JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES
===============================================================================
1
<PAGE> 2
TIE-SHEET
of provisions of Trust Indenture Act of 1939 with Indenture dated as
of June 11, 1997 between AGL Resources Inc. and The Bank of New York, as
Trustee:
<TABLE>
<CAPTION>
ACT SECTION INDENTURE SECTION
<S> <C>
310(a)(1)......................................................................................................6.09
(a)(2) .....................................................................................................6.09
310(a)(3).......................................................................................................N/A
(a)(4).......................................................................................................N/A
310(a)(5)................................................................................................6.10, 6.11
310(b)..........................................................................................................N/A
310(c).........................................................................................................6.13
311(a) and (b)..................................................................................................N/A
311(c)................................................................................................4.01, 4.02(a)
312(a).........................................................................................................4.02
312(b) and (c).................................................................................................4.04
313(a).........................................................................................................4.04
313(b)(1)......................................................................................................4.04
313(b)(2)......................................................................................................4.04
313(c).........................................................................................................4.04
313(d).........................................................................................................4.04
314(a).........................................................................................................4.03
314(b)..........................................................................................................N/A
314(c)(1) and (2)..............................................................................................6.07
314(c)(3).......................................................................................................N/A
314(d) .........................................................................................................N/A
314(e).........................................................................................................6.07
314(f) .........................................................................................................N/A
315(a)(c) and (d)..............................................................................................6.01
315(b) ........................................................................................................5.08
315(e) ........................................................................................................5.09
316(a)(1) .....................................................................................................5.07
316(a)(2) ......................................................................................................N/A
316(a) last sentence ..........................................................................................2.09
316(b) ........................................................................................................9.02
317(a) ........................................................................................................5.05
317(b) ........................................................................................................6.05
318(a) .......................................................................................................13.08
</TABLE>
- -----------------------------------
THIS TIE-SHEET IS NOT PART OF THE INDENTURE AS EXECUTED.
<PAGE> 3
TABLE OF CONTENTS*
<TABLE>
<CAPTION>
Page
----
ARTICLE I
DEFINITIONS
<S> <C>
SECTION 1.01. Definitions........................................................................... 1
Additional Interest..................................................................................... 2
Adjusted Treasury Rate.................................................................................. 2
Affiliate............................................................................................... 2
Authenticating Agent.................................................................................... 3
Bankruptcy Law.......................................................................................... 3
Board of Directors...................................................................................... 3
Board Resolution........................................................................................ 3
Business Day........................................................................................... 3
Capital Securities..................................................................................... 3
Capital Securities Guarantee........................................................................... 3
Commission.............................................................................................. 4
Common Securities....................................................................................... 4
Common Securities Guarantee............................................................................. 4
Common Stock............................................................................................ 4
Company .............................................................................................. 4
Company Request........................................................................................ 4
Comparable Treasury Issue.............................................................................. 4
Comparable Treasury Price............................................................................... 5
Compounded Interest..................................................................................... 5
Custodian............................................................................................... 5
Declaration............................................................................................. 5
Default .............................................................................................. 5
Deferred Interest........................................................................................6
Definitive Securities................................................................................... 6
Depositary.............................................................................................. 6
Dissolution Event....................................................................................... 6
Event of Default........................................................................................ 6
Exchange Act............................................................................................ 6
Exchange Offer.......................................................................................... 6
Extended Interest Payment Period........................................................................ 6
Federal Reserve......................................................................................... 7
Global Security......................................................................................... 7
</TABLE>
-----------------
* THIS TABLE OF CONTENTS SHALL NOT, FOR ANY PURPOSE, BE
DEEMED TO BE A PART OF THE INDENTURE.
i
<PAGE> 4
<TABLE>
<S> <C>
Indenture............................................................................................... 7
Initial Optional Redemption Date........................................................................ 7
Interest Payment Date................................................................................... 7
Investment Company Act Event............................................................................ 7
Issue Date.............................................................................................. 7
Liquidated Damages...................................................................................... 7
Maturity Date........................................................................................... 7
Mortgage ............................................................................................... 7
Non Book-Entry Capital Securities....................................................................... 7
Officers ............................................................................................... 7
Officers' Certificate................................................................................... 8
Opinion of Counsel...................................................................................... 8
Optional Redemption Price............................................................................... 8
Other Debentures........................................................................................ 8
Other Guarantees........................................................................................ 8
outstanding............................................................................................. 8
Person ............................................................................................... 9
Predecessor Security.................................................................................... 9
Principal Office of the Trustee......................................................................... 9
Purchase Agreement...................................................................................... 9
Property Trustee........................................................................................ 9
Quotation Agent......................................................................................... 9
Redemption Price........................................................................................ 9
Reference Treasury Dealer............................................................................... 9
Reference Treasury Dealer Quotations................................................................... 10
Registration Rights Agreement.......................................................................... 10
Responsible Officer.................................................................................... 10
Restricted Security.................................................................................... 10
Rule 144A.............................................................................................. 10
Securities............................................................................................. 10
Securities Act......................................................................................... 11
Securityholder......................................................................................... 11
Security Register...................................................................................... 11
Senior Indebtedness.................................................................................... 11
Series A Securities.................................................................................... 12
Series B Securities.................................................................................... 12
Special Event...........................................................................................12
Special Event Redemption Price..........................................................................12
Subsidiary............................................................................................. 12
Tax Event.............................................................................................. 13
Trustee .............................................................................................. 13
Trust Indenture Act of 1939............................................................................ 13
Trust Securities....................................................................................... 13
U.S. Government Obligations............................................................................ 13
AGL Capital Trust...................................................................................... 14
</TABLE>
ii
<PAGE> 5
ARTICLE II
SECURITIES
<TABLE>
<S> <C> <C>
SECTION 2.01. Forms Generally...................................................................... 14
SECTION 2.02. Execution and Authentication......................................................... 14
SECTION 2.03. Form and Payment..................................................................... 15
SECTION 2.04. Legends.............................................................................. 16
SECTION 2.05. Global Security...................................................................... 16
SECTION 2.06 Interest............................................................................. 18
SECTION 2.07. Transfer and Exchange................................................................ 19
SECTION 2.08. Replacement Securities............................................................... 22
SECTION 2.09. Temporary Securities................................................................. 22
SECTION 2.10. Cancellation......................................................................... 23
SECTION 2.11. Defaulted Interest................................................................... 23
SECTION 2.12. CUSIP Numbers........................................................................ 24
</TABLE>
ARTICLE III
PARTICULAR COVENANTS OF THE COMPANY
<TABLE>
<S> <C> <C>
SECTION 3.01. Payment of Principal, Premium and Inter-
est.................................................................................. 25
SECTION 3.02. Offices for Notices and Payments, etc................................................ 25
SECTION 3.03. Appointments to Fill Vacancies in
Trustee's Office..................................................................... 26
SECTION 3.04. Provision as to Paying Agent......................................................... 26
SECTION 3.05. Certificate to Trustee............................................................... 27
SECTION 3.06. Compliance with Consolidation Provisions............................................. 28
SECTION 3.07. Limitation on Dividends.............................................................. 28
SECTION 3.08. Covenants as to AGL Capital Trust.................................................... 29
SECTION 3.09. Payment of Expenses.................................................................. 29
SECTION 3.10. Payment Upon Resignation or Removal.................................................. 30
</TABLE>
ARTICLE IV
SECURITYHOLDERS' LISTS AND REPORTS BY THE
COMPANY AND THE TRUSTEE
<TABLE>
<S> <C> <C>
SECTION 4.01. Securityholders' Lists............................................................... 31
SECTION 4.02. Preservation and Disclosure of Lists................................................. 31
</TABLE>
iii
<PAGE> 6
<TABLE>
<S> <C> <C>
SECTION 4.03. Reports by Company................................................................... 33
SECTION 4.04. Reports by the Trustee............................................................... 35
</TABLE>
ARTICLE V
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
<TABLE>
<S> <C> <C>
SECTION 5.01. Events of Default.................................................................... 36
SECTION 5.02. Payment of Securities on Default; Suit
Therefor............................................................................. 38
SECTION 5.03. Application of Moneys Collected by
Trustee.............................................................................. 41
SECTION 5.04. Proceedings by Securityholders....................................................... 41
SECTION 5.05. Proceedings by Trustee............................................................... 43
SECTION 5.06. Remedies Cumulative and Continuing................................................... 43
SECTION 5.07. Direction of Proceedings and Waiver of Defaults by Majority of Securityholders....... 43
SECTION 5.08. Notice of Defaults................................................................... 45
SECTION 5.09. Undertaking to Pay Costs............................................................. 45
</TABLE>
ARTICLE VI
CONCERNING THE TRUSTEE
<TABLE>
<S> <C> <C>
SECTION 6.01. Duties and Responsibilities of Trustee............................................... 46
SECTION 6.02. Reliance on Documents, Opinions, etc................................................. 47
SECTION 6.03. No Responsibility for Recitals, etc.................................................. 49
SECTION 6.04. Trustee, Authenticating Agent, Paying Agents, Transfer Agents or Registrar May
Own Securities....................................................................... 40
SECTION 6.05. Moneys to be Held in Trust........................................................... 50
SECTION 6.06. Compensation and Expenses of Trustee................................................. 50
SECTION 6.07. Officers' Certificate as Evidence.................................................... 51
SECTION 6.08. Conflicting Interest of Trustee...................................................... 51
SECTION 6.09. Eligibility of Trustee............................................................... 52
SECTION 6.10. Resignation or Removal of Trustee.................................................... 52
SECTION 6.11. Acceptance by Successor Trustee...................................................... 54
SECTION 6.12. Succession by Merger, etc............................................................ 55
SECTION 6.13. Limitation on Rights of Trustee as a Creditor........................................ 56
SECTION 6.14. Authenticating Agents................................................................ 56
</TABLE>
iv
<PAGE> 7
ARTICLE VII
CONCERNING THE SECURITYHOLDERS
<TABLE>
<S> <C> <C>
SECTION 7.01. Action by Securityholders............................................................ 58
SECTION 7.02. Proof of Execution by Securityholders................................................ 59
SECTION 7.03. Who Are Deemed Absolute Owners....................................................... 59
SECTION 7.04. Securities Owned by Company Deemed Not Outstanding................................... 59
SECTION 7.05. Revocation of Consents; Future Holders
Bound................................................................................ 60
</TABLE>
ARTICLE VIII
SECURITYHOLDERS' MEETINGS
<TABLE>
<S> <C> <C>
SECTION 8.01. Purposes of Meetings................................................................. 61
SECTION 8.02. Call of Meetings by Trustee.......................................................... 61
SECTION 8.03. Call of Meetings by Company or Securityholders....................................... 62
SECTION 8.04. Qualifications for Voting............................................................ 62
SECTION 8.05. Regulations.......................................................................... 62
SECTION 8.06. Voting............................................................................... 63
</TABLE>
ARTICLE IX
AMENDMENTS
<TABLE>
<S> <C> <C>
SECTION 9.01. Without Consent of Securityholders................................................... 64
SECTION 9.02. With Consent of Securityholders...................................................... 66
SECTION 9.03. Compliance with Trust Indenture Act; Effect of Supplemental Indentures............... 67
SECTION 9.04. Notation on Securities............................................................... 67
SECTION 9.05. Evidence of Compliance of Supplemental
Indenture to be Furnished Trustee.................................................... 68
</TABLE>
ARTICLE X
CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
<TABLE>
<S> <C> <C>
SECTION 10.01. Company May Consolidate, etc., on Certain Terms...................................... 68
</TABLE>
v
<PAGE> 8
<TABLE>
<S> <C> <C>
SECTION 10.02. Successor Corporation to be Substituted for Company......................... 69
SECTION 10.03. Opinion of Counsel to be Given Trustee...................................... 70
</TABLE>
ARTICLE XI
SATISFACTION AND DISCHARGE OF INDENTURE
<TABLE>
<S> <C> <C>
SECTION 11.01. Discharge of Indenture...................................................... 70
SECTION 11.02. Deposited Moneys and U.S. Government Obligations to be Held in Trust by
Trustee..................................................................... 71
SECTION 11.03. Paying Agent to Repay Moneys Held........................................... 71
SECTION 11.04. Return of Unclaimed Moneys.................................................. 72
SECTION 11.05. Defeasance Upon Deposit of Moneys or U.S. Government Obligations............ 72
</TABLE>
ARTICLE XII
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS
<TABLE>
<S> <C> <C>
SECTION 12.01. Indenture and Securities Solely Corporate Obligations....................... 74
</TABLE>
ARTICLE XIII
MISCELLANEOUS PROVISIONS
<TABLE>
<S> <C> <C>
SECTION 13.01. Successors.................................................................. 75
SECTION 13.02. Official Acts by Successor Corporation...................................... 75
SECTION 13.03. Surrender of Company Powers................................................. 75
SECTION 13.04. Addresses for Notices, etc.................................................. 75
SECTION 13.05. Governing Law............................................................... 76
SECTION 13.06. Evidence of Compliance with Conditions
Precedent................................................................... 76
SECTION 13.07. Business Days............................................................... 77
SECTION 13.08. Trust Indenture Act to Control.............................................. 77
SECTION 13.09. Table of Contents, Headings, etc............................................ 77
SECTION 13.10. Execution in Counterparts................................................... 77
SECTION 13.11. Separability................................................................ 77
SECTION 13.12. Assignment.................................................................. 78
SECTION 13.13. Acknowledgment of Rights.................................................... 78
</TABLE>
vi
<PAGE> 9
ARTICLE XIV
REDEMPTION OF SECURITIES -- MANDATORY AND
OPTIONAL SINKING FUND
<TABLE>
<S> <C> <C>
SECTION 14.01. Special Event Redemption.................................................... 78
SECTION 14.02. Optional Redemption by Company.............................................. 79
SECTION 14.03. No Sinking Fund............................................................. 80
SECTION 14.04. Notice of Redemption; Selection of Securities............................... 81
SECTION 14.05. Payment of Securities Called for Redemption................................. 82
</TABLE>
ARTICLE XV
SUBORDINATION OF SECURITIES
<TABLE>
<S> <C> <C>
SECTION 15.01. Agreement to Subordinate.................................................... 83
SECTION 15.02. Default on Senior Indebtedness.............................................. 83
SECTION 15.03. Liquidation; Dissolution; Bankruptcy........................................ 84
SECTION 15.04. Subrogation................................................................. 86
SECTION 15.05. Trustee to Effectuate Subordination......................................... 87
SECTION 15.06. Notice by the Company....................................................... 87
SECTION 15.07. Rights of the Trustee; Holders of Senior
Indebtedness................................................................ 88
SECTION 15.08. Subordination May Not Be Impaired........................................... 89
</TABLE>
ARTICLE XVI
EXTENSION OF INTEREST PAYMENT PERIOD
<TABLE>
<S> <C> <C> <C>
SECTION 16.01. Extension of Interest Payment Period........................................ 90
SECTION 16.02. Notice of Extension......................................................... 91
EXHIBIT A.......................................................................................................A-1
</TABLE>
Testimonium
Signatures
Acknowledgments
vii
<PAGE> 10
THIS INDENTURE, dated as of June 11, 1997, between AGL Resources Inc.,
a Georgia corporation (hereinafter sometimes called the "Company"), and The
Bank of New York, a New York banking corporation, as trustee (hereinafter
sometimes called the "Trustee"),
W I T N E S S E T H :
In consideration of the premises and the purchase of the Securities by
the holders thereof, the Company covenants and agrees with the Trustee for the
equal and proportionate benefit of the respective holders from time to time of
the Securities, as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions.
The terms defined in this Section 1.01 (except as herein otherwise
expressly provided or unless the context otherwise requires) for all purposes
of this Indenture shall have the respective meanings specified in this Section
1.01. All other terms used in this Indenture which are defined in the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"), or which are by
reference therein defined in the Securities Act, shall (except as herein
otherwise expressly provided or unless the context otherwise requires) have the
meanings assigned to such terms in the Trust Indenture Act and in the
Securities Act as in force at the date of this Indenture as originally
executed. The following terms have the meanings given to them in the
Declaration: (i) Clearing Agency; (ii) Delaware Trustee; (iii) Property
Trustee; (iv) Administrative Trustees; (v) Direct Action; (vi) Purchase
Agreement; (vii) Distributions; (viii) Series A Capital Securities; and (ix)
Series B Capital Securities. All accounting terms used herein and not expressly
defined shall have the meanings assigned to such terms in accordance with
generally accepted accounting principles and the term "generally accepted
accounting principles" means such accounting principles as are generally
accepted at the time of any computation. The words "herein", "hereof" and
"hereunder" and other words of similar import refer to this Indenture as a
whole and not to any particular Article, Section or other subdivision. Headings
are used for convenience of reference only
<PAGE> 11
and do not affect interpretation. The singular includes the plural and vice
versa.
"Additional Interest" shall have the meaning set forth in Section
2.06(c).
"Adjusted Treasury Rate" means, with respect to any redemption date,
the rate per annum equal to (i) the yield, under the heading which represents
the average for the immediately prior week, appearing in the most recently
published statistical release designated "H.15 (519)" or any successor
publication which is published weekly by the Federal Reserve and which
establishes yields on actively traded United States Treasury securities
adjusted to constant maturity under the caption "Treasury Constant Maturities,"
for the maturity corresponding to the Initial Optional Redemption Date (if no
maturity is within three months before or after the Initial Optional Redemption
Date, yields for the two published maturities most closely corresponding to the
Initial Optional Redemption Date shall be interpolated, and the Adjusted
Treasury Rate shall be interpolated or extrapolated from such yields on a
straight-line basis, rounding to the nearest month) or (ii) if such release (or
any successor release) is not published during the week preceding the
calculation date or does not contain such yields, the rate per annum equal to
the semi-annual equivalent yield to maturity of the Comparable Treasury Issue,
assuming a price for the Comparable Treasury Issue (expressed as a percentage
of its principal amount) equal to the Comparable Treasury Price for such
redemption date plus, in either case, (a) 1.05% if such redemption date occurs
from and including June 15, 1997 through and including June 1, 1998, and (b)
.50% if such redemption date occurs after June 1, 1999.
"Affiliate" means, with respect to a specified Person, (a) any Person
directly or indirectly owning, controlling or holding the power to vote 10% or
more of the outstanding voting securities or other ownership interests of the
specified Person, (b) any Person 10% or more of whose outstanding voting
securities or other ownership interests are directly or indirectly owned,
controlled or held with power to vote by the specified Person, (c) any Person
directly or indirectly controlling, controlled by, or under common control with
the specified Person, (d) a partnership in which the specified Person is a
general partner, (e) any officer or director of the specified Person, and (f)
if
2
<PAGE> 12
the specified Person is an individual, any entity of which the specified Person
is an officer, director or general partner.
"Authenticating Agent" shall mean any agent or agents of the Trustee
which at the time shall be appointed and acting pursuant to Section 6.14.
"Bankruptcy Law" shall mean Title 11, U.S. Code, or any similar
federal or state law for the relief of debtors.
"Board of Directors" shall mean either the Board of Directors of the
Company or any duly authorized committee of that board.
"Board Resolution" shall mean a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"Business Day" shall mean, with respect to any series of Securities,
any day other than a Saturday or a Sunday or a day on which banking
institutions in The City of New York are authorized or required by law or
executive order to close.
"Capital Securities" shall mean undivided beneficial interests in the
assets of AGL Capital Trust which rank pari passu with the Common Securities
issued by AGL Capital Trust; provided, however, that if an Event of Default has
occurred and is continuing, no payments in respect of Distributions on, or
payments upon liquidation, redemption or otherwise with respect to, the Common
Securities shall be made until the holders of the Capital Securities shall be
paid in full the Distributions and the liquidation, redemption and other
payments to which they are entitled. References to "Capital Securities" shall
include collectively any Series A Capital Securities and Series B Capital
Securities.
"Capital Securities Guarantee" shall mean any guarantee that the
Company may enter into with The Bank of New York, in its capacity as trustee of
the AGL Capital Trust or other Person that operates directly or indirectly for
the benefit of holders of Capital Securities of AGL Capital Trust and shall
include a Series A Capital Securities Guarantee and a Series B Capital
3
<PAGE> 13
Securities Guarantee with respect to the Series A Capital Securities and the
Series B Capital Securities, respectively.
"Commission" shall mean the Securities and Exchange Commission, as
from time to time constituted, created under the Exchange Act, or if at any
time after the execution of this Indenture such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then
the body performing such duties at such time.
"Common Securities" shall mean undivided beneficial interests in the
assets of AGL Capital Trust which rank pari passu with Capital Securities
issued by AGL Capital Trust; provided, however, that if an Event of Default has
occurred and is continuing, no payments in respect of Distributions on, or
payments upon liquidation, redemption or otherwise with respect to, the Common
Securities shall be made until the holders of the Capital Securities shall be
paid in full the Distributions and the liquidation, redemption and other
payments to which they are entitled.
"Common Securities Guarantee" shall mean any guarantee that the
Company may enter into with any Person or Persons that operates directly or
indirectly for the benefit of holders of Common Securities of AGL Capital
Trust.
"Common Stock" shall mean the Common Stock, par value $5.00 per share,
of the Company or any other class of stock resulting from changes or
reclassifications of such Common Stock consisting solely of changes in par
value, or from par value to no par value, or from no par value to par value.
"Company" shall mean AGL Resources Inc., a Georgia corporation, and,
subject to the provisions of Article X, shall include its successors and
assigns.
"Company Request" or "Company Order" shall mean a written request or
order signed in the name of the Company by the Chairman, the Chief Executive
Officer, the President, a Vice Chairman, a Vice President, the Treasurer, the
Controller, the Secretary or an Assistant Secretary of the Company, and
delivered to the Trustee.
"Comparable Treasury Issue" means the United States Treasury security
selected by the Quotation Agent as having a
4
<PAGE> 14
maturity date corresponding to the Initial Optional Redemption Date that would
be utilized, at the time of selection and in accordance with customary
financial practice, in pricing new issues of corporate debt securities with a
maturity date corresponding to the Initial Optional Redemption Date. If no
United States Treasury security has a maturity date which is within three
months before or after the Initial Optional Redemption Date, the two most
closely corresponding United States Treasury securities shall be used as the
Comparable Treasury Issue, and the calculation of the Adjusted Treasury Rate
pursuant to clause (ii) of the definition thereof shall be interpolated or
extrapolated on a straight-line basis, rounding to the nearest month.
"Comparable Treasury Price" means, with respect to any redemption date
pursuant to Section 14.01, (i) the average of the bid and asked prices for the
Comparable Treasury Issue (expressed in each case as a percentage of its
principal amount) on the third Business Day preceding such redemption date, as
set forth in the daily statistical release (or any successor release) published
by the Federal Reserve Bank of New York and designated "Composite 3:30 p.m.
Quotations for U.S. Government Securities" or (ii) if such release (or any
successor release) is not published or does not contain such prices on such
Business Day, (A) the average of five Reference Treasury Dealer Quotations for
such redemption date, after excluding the highest and lowest such Reference
Treasury Dealer Quotations, or (B) if the Trustee obtains fewer than three such
Reference Treasury Dealer Quotations, the average of all such Quotations.
"Compounded Interest" shall have the meaning set forth in Section
16.01.
"Custodian" shall mean any receiver, trustee, assignee, liquidator, or
similar official under any Bankruptcy Law.
"Declaration" means the Amended and Restated Declaration of Trust of
AGL Capital Trust, dated as of the Issue Date.
"Declaration Event of Default" means an "Event of Default" as defined
in and under the Declaration.
5
<PAGE> 15
"Default" means any event, act or condition that with notice or lapse
of time, or both, would constitute an Event of Default.
"Deferred Interest" shall have the meaning set forth in Section 16.01.
"Definitive Securities" shall mean those securities issued in fully
registered certificated form not otherwise in global form.
"Depositary" shall mean, with respect to Securities of any series, for
which the Company shall determine that such Securities will be issued as a
Global Security, The Depository Trust Company, New York, New York, another
clearing agency, or any successor registered as a clearing agency under the
Exchange Act or other applicable statute or regulation, which, in each case,
shall be designated by the Company pursuant to Section 2.05(d).
"Dissolution Event" means the liquidation of the Trust pursuant to the
Declaration, and the distribution of the Securities held by the Property
Trustee to the holders of the Trust Securities issued by the Trust pro rata in
accordance with the Declaration.
"Event of Default" shall mean any event specified in Section 5.01,
continued for the period of time, if any, and after the giving of the notice,
if any, therein designated.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Exchange Offer" means the offer that may be made pursuant to the
Registration Rights Agreement (i) by the Company to exchange Series B
Securities for Series A Securities and to exchange a Series B Capital
Securities Guarantee for a Series A Capital Securities Guarantee and (ii) by
AGL Capital Trust to exchange Series B Capital Securities for Series A Capital
Securities.
"Extended Interest Payment Period" shall have the meaning set forth in
Section 16.01.
6
<PAGE> 16
"Federal Reserve" shall mean the Board of Governors of the Federal
Reserve System.
"Global Security" means, with respect to the Securities, a Security
executed by the Company and delivered by the Trustee to the Depositary or
pursuant to the Depositary's instruction, all in accordance with the Indenture,
which shall be registered in the name of the Depositary or its nominee.
"Indenture" shall mean this instrument as originally executed or, if
amended as herein provided, as so amended.
"Initial Optional Redemption Date" means June 1, 2007.
"Interest Payment Date" shall have the meaning set forth in Section
2.06.
"Investment Company Act Event" shall mean the receipt by AGL Capital
Trust and the Company of an opinion of counsel experienced in such matters to
the effect that, as a result of the occurrence of a change in law or regulation
or a change in interpretation or application of law or regulation by any
legislative body, court, governmental agency or regulatory authority, there is
more than an insubstantial risk that AGL Capital Trust is or will be considered
an "investment company" that is required to be registered under the Investment
Company Act of 1940, as amended, which change becomes effective on or after the
Issue Date of the Capital Securities.
"Issue Date" means June 11, 1997.
"Liquidated Damages" shall have the meaning set forth in the
Registration Rights Agreement.
"Maturity Date" shall mean June 1, 2037.
"Mortgage" shall mean and include any mortgage, pledge, lien, security
interest, conditional sale or other title retention agreement or other similar
encumbrance.
"Non Book-Entry Capital Securities" shall have the meaning set forth
in Section 2.05.
"Officers" shall mean any of the Chairman, a Vice Chairman, the Chief
Executive Officer, the President, a Vice
7
<PAGE> 17
President, the Treasurer or an assistant Treasurer, the Controller,
the Secretary or an Assistant Secretary of the Company.
"Officers' Certificate" shall mean a certificate signed by two
Officers and delivered to the Trustee.
"Opinion of Counsel" shall mean a written opinion of counsel, who may
be an employee of the Company and who shall be acceptable to the Trustee.
"Optional Redemption Price" shall have the meaning set forth in
Section 14.02.
"Other Debentures" means all junior subordinated debentures issued by
the Company from time to time and sold to trusts to be established by the
Company (if any), in each case similar to the Trust.
"Other Guarantees" means all guarantees issued by the Company with
respect to capital securities (if any) and issued to other trusts established
by the Company (if any), in each case similar to the Trust.
The term "outstanding" when used with reference to Securities, shall,
subject to the provisions of Section 7.04, mean, as of any particular time, all
Securities authenticated and delivered by the Trustee or the Authenticating
Agent under this Indenture, except
(a) Securities theretofore cancelled by the Trustee or the
Authenticating Agent or delivered to the Trustee for
cancellation;
(b) Securities, or portions thereof, for the payment or
redemption of which moneys in the necessary amount shall have
been deposited in trust with the Trustee or with any paying
agent (other than the Company) or shall have been set aside
and segregated in trust by the Company (if the Company shall
act as its own paying agent); provided that, if such
Securities, or portions thereof, are to be redeemed prior to
maturity thereof, notice of such redemption shall have been
given as in Article XIV
8
<PAGE> 18
provided or provision satisfactory to the Trustee shall have
been made for giving such notice; and
(c) Securities in lieu of or in substitution for which other
Securities shall have been authenticated and delivered
pursuant to the terms of Section 2.08 unless proof
satisfactory to the Company and the Trustee is presented that
any such Securities are held by bona fide holders in due
course.
"Person" shall mean any individual, corporation, estate, partnership,
joint venture, association, joint-stock company, limited liability company,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt and as that evidenced by
such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 2.08 in lieu of a lost,
destroyed or stolen Security shall be deemed to evidence the same debt as the
lost, destroyed or stolen Security.
"Principal Office of the Trustee", or other similar term, shall mean
the office of the Trustee, at which at any particular time its corporate trust
business shall be principally administered.
"Purchase Agreement" shall mean the Purchase Agreement dated June 11,
1997 among the Company, AGL Capital Trust and the initial purchasers named
therein.
"Property Trustee" shall have the same meaning as set forth in the
Declaration.
"Quotation Agent" means the Reference Treasury Dealer appointed by the
Company.
"Redemption Price" means the Special Event Redemption Price or the
Optional Redemption Price, as the context requires.
"Reference Treasury Dealer" means (i) Merrill Lynch Government
Securities, Inc. and its respective successors; provided, however, that if the
foregoing shall cease to be a
9
<PAGE> 19
primary U.S. Government securities dealer in New York City (a "Primary Treasury
Dealer"), the Company shall substitute therefor another Primary Treasury
Dealer, and (ii) any other Primary Treasury Dealer selected by the Company.
"Reference Treasury Dealer Quotations" means, with respect to each
Reference Treasury Dealer and any date pursuant to Section 14.01, the average,
as determined by the Trustee, of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount)
quoted in writing to the Trustee by such Reference Treasury Dealer at 5:00
p.m., New York City time on the third Business Day preceding such redemption
date.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of the Issue Date, by and among the Company, the Trust and
the Initial Purchasers named therein as such agreement may be amended, modified
or supplemented from time to time.
"Responsible Officer", when used with respect to the Trustee, shall
mean the chairman or any vice chairman of the board of directors, the chairman
or any vice chairman of the executive committee of the board of directors, the
chairman of the trust committee, the president, any vice president, the
cashier, any assistant cashier, the secretary, any assistant secretary, the
treasurer, any assistant treasurer or senior trust officer, any trust officer
or assistant trust officer, the controller or any assistant controller or any
other officer or assistant officer of the Trustee customarily performing
functions similar to those performed by any of the above designated officers
and also means, with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of his knowledge of and
familiarity with the particular subject.
"Restricted Security" shall mean Securities that bear or are required
to bear the Securities Act legends set forth in Exhibit A hereto.
"Rule 144A" means Rule 144A under the Securities Act, as such Rule may
be amended from time to time, or under any similar rule or regulation hereafter
adopted by the Commission.
"Securities" means, collectively, the Series A Securities and the
Series B Securities.
10
<PAGE> 20
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Securityholder", "holder of Securities", or other similar terms,
shall mean any person in whose name at the time a particular Security is
registered on the register kept by the Company or the Trustee for that purpose
in accordance with the terms hereof.
"Security Register" shall mean (i) prior to a Dissolution Event, the
list of holders provided to the Trustee pursuant to Section 4.01, and (ii)
following a Dissolution Event, any security register maintained by a security
registrar for the Securities appointed by the Company following the execution
of a supplemental indenture providing for transfer procedures as provided for
in Section 2.07(a).
"Senior Indebtedness" shall mean, with respect to an obligor, (i) the
principal, premium, if any, and interest in respect of (A) indebtedness of such
obligor for money borrowed, and (B) indebtedness evidenced by securities,
debentures, bonds or other similar instruments issued by such obligor, (ii) all
capital lease obligations of such obligor, (iii) all obligations of such
obligor issued or assumed as the deferred purchase price of property, all
conditional sale obligations of such obligor and all obligations of such
obligor under any title retention agreement (but excluding trade accounts
payable arising in the ordinary course of business, (iv) all obligations of
such obligor for the reimbursement on any letter of credit, banker's
acceptance, security purchase facility or similar credit transaction, (v) all
obligations of the type referred to in clauses (i) through (v) above of other
persons secured by any lien on any property or asset of such obligor (whether
or not such obligation is assumed by such obligor), except for (1) any such
indebtedness that is by its terms subordinated to or ranks pari passu with the
Securities, and (2) all debt securities or guarantees in respect of those debt
securities, issued to any other trust, or a trustee of such trust, partnership
or other entity affiliated with the Company that is a financing vehicle of the
Company (a "financing entity") in connection with the issuance by such
financing entity of equity securities or other securities guaranteed by the
Company pursuant to an instrument that ranks pari passu with or junior in right
of payment to the Capital Securities Guarantee.
11
<PAGE> 21
"Series A Securities" means the Company's 8.17% Series A Junior
Subordinated Deferrable Interest Debentures due June 1, 2037, as authenticated
and issued under this Indenture.
"Series B Securities" means the Company's Series B 8.17% Junior
Subordinated Deferrable Interest Debentures due June 1, 2037, as authenticated
and issued under this Indenture.
"Special Event" shall mean a Tax Event or an Investment Company Act
Event.
"Special Event Redemption Price" shall mean, with respect to any
redemption of the Securities pursuant to Section 14.01 hereof, for all periods
after June 14, 1997, an amount of cash equal to the greater of (i) 100% of the
principal amount to be redeemed or (ii) the sum, as determined by a Quotation
Agent (as defined below), of the present values of the principal amount and
premium payable with respect to an optional redemption of the Securities on
June 1, 2007, together with scheduled payments of interest on the Securities
accruing from the prepayment date to and including June 1, 2007 discounted to
the prepayment date on a semi-annual basis (assuming a 360-day year consisting
of twelve 30-day months) at the Adjusted Treasury Rate, plus, in each case,
accrued interest thereon to the date of prepayment.
Notwithstanding the foregoing, the Special Event Redemption Price for
the period through and including June 14, 1997, shall mean an amount of cash
equal to the greater of (i) 100% of the principal amount to be redeemed or (ii)
the sum, as determined by a Quotation Agent, of the present values of the
principal amount and premium payable with respect to an optional redemption of
the Securities to be redeemed on June 1, 2007, together with scheduled payments
of interest on the Securities to be redeemed accruing from the prepayment date
to and including June 1, 2007, discounted to the prepayment date on a
semi-annual basis (assuming a 360-day year consisting of twelve 30-day months)
using the United States Treasury 6 1/2% due November 2026, plus 1.30%.
"Subsidiary" shall mean with respect to any Person, (i) any
corporation at least a majority of whose outstanding voting stock is owned,
directly or indirectly, by such Person or by one or more of its Subsidiaries,
or by such Person and one or more of its Subsidiaries, (ii) any general
partnership, joint venture or similar entity, at least a majority of whose
outstand-
12
<PAGE> 22
ing partnership or similar interests shall at the time be owned by such Person,
or by one or more of its Subsidiaries, or by such Person and one or more of its
Subsidiaries and (iii) any limited partnership of which such Person or any of
its Subsidiaries is a general partner. For the purposes of this definition,
"voting stock" means shares, interests, participations or other equivalents in
the equity interest (however designated) in such Person having ordinary voting
power for the election of a majority of the directors (or the equivalent) of
such Person, other than shares, interests, participations or other equivalents
having such power only by reason of the occurrence of a contingency.
"Tax Event" shall mean the receipt by AGL Capital Trust and the
Company of an opinion of counsel experienced in such matters to the effect
that, as a result of 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, or
as result of any official administrative pronouncement or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
effective or such pronouncement or decision is announced on or after the Issue
Date, there is more than an insubstantial risk that (i) AGL Capital Trust is,
or will be within 90 days of the date of such opinion, subject to United States
federal income tax with respect to all or part of the income received or
accrued on the Securities, (ii) interest payable by the Company on the
Securities is not, or within 90 days of the date of such opinion will not be,
deductible by the Company, in whole or in part, for United States federal
income tax purposes, or (iii) AGL Capital Trust is, or will be within 90 days
of the date of such opinion, subject to more than a deminimis amount of other
taxes, duties or other governmental charges.
"Trustee" shall mean the Person identified as "Trustee" in the first
paragraph hereof, and, subject to the provisions of Article VI hereof, shall
also include its successors and assigns as Trustee hereunder. The term
"Trustee" as used with respect to a particular series of the Securities shall
mean the trustee with respect to that series.
"Trust Indenture Act of 1939" shall mean the Trust Indenture Act of
1939 as in force at the date of execution of this Indenture, except as provided
in Section 9.03.
13
<PAGE> 23
"Trust Securities" shall mean the Capital Securities and the Common
Securities, collectively.
"U.S. Government Obligations" shall mean securities that are (i)
direct obligations of the United States of America for the payment of which its
full faith and credit is pledged or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States
of America the payment of which is unconditionally guaranteed as a full faith
and credit obligation by the United States of America, which, in either case
under clauses (i) or (ii) are not callable or redeemable at the option of the
issuer thereof, and shall also include a depository receipt issued by a bank or
trust company as custodian with respect to any such U.S. Government Obligation
or a specific payment of interest on or principal of any such U.S. Government
Obligation held by such custodian for the account of the holder of a depository
receipt, provided that (except as required by law) such custodian is not
authorized to make any deduction from the amount payable to the holder of such
depository receipt from any amount received by the custodian in respect of the
U.S. Government Obligation or the specific payment of interest on or principal
of the U.S. Government Obligation evidenced by such depository receipt.
"AGL Capital Trust" shall mean AGL Capital Trust, a Delaware business
trust created for the purpose of issuing its undivided beneficial interests in
connection with the issuance of Securities under this Indenture.
ARTICLE II
SECURITIES
SECTION 2.01. Forms Generally.
The Securities and the Trustee's certificate of authentication shall
be substantially in the form of Exhibit A, the terms of which are incorporated
in and made a part of this Indenture. The Securities may have notations,
legends or endorsements required by law, stock exchange rule, agreements to
which the Company is subject or usage. Each Security shall be dated the date of
its authentication. The Securities shall be issued in denominations of $1,000
and integral multiples thereof.
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SECTION 2.02. Execution and Authentication.
Two Officers shall sign the Securities for the Company by manual or
facsimile signature in the manner set forth in Exhibit A. If an Officer whose
signature is on a Security no longer holds that office at the time the Security
is authenticated, the Security shall nevertheless be valid.
A Security shall not be valid until authenticated by the manual
signature of an authorized officer of the Trustee. The signature of the Trustee
shall be conclusive evidence that the Security has been authenticated under
this Indenture. The form of Trustee's certificate of authentication to be borne
by the Securities shall be substantially as set forth in Exhibit A hereto.
The Trustee shall, upon a Company Order, authenticate for original
issue up to, and the aggregate principal amount of Securities outstanding at
any time may not exceed the sum of $77,320,000 principal amount of the
Securities, except as provided in Sections 2.07, 2.08, 2.09 and 14.05. The
series of Securities to be initially issued hereunder shall be the Series A
Securities.
SECTION 2.03. Form and Payment.
Except as provided in Section 2.05, the Securities shall be issued in
fully registered certificated form without interest coupons. Principal of,
premium, if any, and interest on the Securities issued in certificated form
will be payable, the transfer of such Securities will be registrable and such
Securities will be exchangeable for Securities bearing identical terms and
provisions at the office or agency of the Company maintained for such purpose
under Section 3.02; provided, however, that payment of interest with respect to
the Securities may be made at the option of the Company (i) by check mailed to
the holder at such address as shall appear in the Security Register or (ii) by
transfer to an account maintained by the Person entitled thereto, provided that
proper transfer instructions have been received in writing by the relevant
record date. Notwithstanding the foregoing, so long as the holder of any
Securities is the Property Trustee, the payment of the principal of, premium,
if any, and interest (including Compounded Interest and Additional Interest, if
any) on such Securities held by the Property Trustee will be
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made at such place and to such account as may be designated by the Property
Trustee.
SECTION 2.04. Legends.
(a) Except as permitted by subsection (b) of this Section 2.04 or as
otherwise determined by the Company in accordance with applicable law, each
Security shall bear the applicable legends relating to restrictions on
transfer pursuant to the securities laws in substantially the form set forth on
Exhibit A hereto.
(b) The Company shall issue and the Trustee shall authenticate Series
B Securities in exchange for Series A Securities accepted for exchange in the
Exchange Offer, which Series B Securities shall not bear the legends required
by subsection (a) above, in each case unless the holder of such Series A
Securities is either (A) a broker-dealer who purchased such Series A Securi-
ties directly from the Company for resale pursuant to Rule 144A or any other
available exemption under the Securities Act, (B) a Person participating in the
distribution of the Series A Securities or (C) a Person who is an affiliate
(as defined in Rule 144 under the Securities Act) of the Company.
SECTION 2.05. Global Security.
(a) In connection with a Dissolution Event,
(i) if any Capital Securities are held in book-entry form,
the related Definitive Securities shall be presented to the Trustee
(if an arrangement with the Depositary has been maintained) by the
Property Trustee in exchange for one or more Global Securities (as may
be required pursuant to Section 2.07) in an aggregate principal amount
equal to the aggregate principal amount of all outstanding Securi-
ties, 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
Administrative Trustees; the Company upon any such presentation shall
execute one or more Global Securities in such aggregate principal
amount and deliver the same to the Trustee for authentication and
delivery in accordance with this Indenture; and payments on the Secur-
ities issued as a Global Security will be made to the Depositary; and
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(ii) if any Capital Securities are held in certificated
form, the related Definitive Securities may be presented to the
Trustee by the Property Trustee and any Capital Security certificate
which represents Capital Securities other than Capital Securities in
book-entry form ("Non Book-Entry Capital Securities") will be deemed
to represent beneficial interests in Securities presented to the
Trustee by the Property Trustee having an aggregate principal amount
equal to the aggregate liquidation amount of the Non Book-Entry
Capital Securities until such Capital Security certificates are
presented to the Security Registrar for transfer or reissuance, at
which time such Capital Security certificates will be cancelled and a
Security, registered in the name of the holder of the Capital Security
certificate or the transferee of the holder of such Capital Security
certificate, as the case may be, with an aggregate principal amount
equal to the aggregate liquidation amount of the Capital Security
certificate cancelled, will be executed by the Company and delivered
to the Trustee for authentication and delivery in accordance with the
Indenture. Upon the issuance of such Securities, Securities with an
equivalent aggregate principal amount that were presented by the
Property Trustee to the Trustee will be deemed to have been cancelled.
(b) The Global Securities shall represent the aggregate amount of
outstanding Securities from time to time endorsed thereon; provided, that the
aggregate amount of outstanding Securities represented thereby may from time to
time be reduced or increased, as appropriate, to reflect exchanges and redemp-
tions. Any endorsement of a Global Security to reflect the amount of any
increase or decrease in the amount of outstanding Securities represented
thereby shall be made by the Trustee, in accordance with instructions given by
the Company as required by this Section 2.05.
(c) The Global Securities may be transferred, in whole but not in
part, only to the Depositary, another nominee of the Depositary, or to a
successor Depositary selected or approved by the Company or to a nominee of
such successor Depositary.
(d) If at any time the Depositary notifies the Company that it is
unwilling or unable to continue as Depositary or the Depositary has ceased to
be a clearing agency registered under the Exchange Act, and a successor
Depositary is not appointed by
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the Company within 90 days after the Company receives such notice or becomes
aware of such condition, as the case may be, the Company will execute, and the
Trustee, upon written notice from the Company, will authenticate and make
available for delivery the Definitive Securities, in authorized denominations,
and in an aggregate principal amount equal to the principal amount of the
Global Security in exchange for such Global Security. If there is an Event of
Default, the Depositary shall have the right to exchange the Global Securities
for Definitive Securities. In addition, the Company may at any time determine
that the Securities shall no longer be represented by a Global Security. In
the event of such an Event of Default or such a determination, the Company
shall execute, and subject to Section 2.07, the Trustee, upon receipt of an
Officers' Certificate evidencing such determination by the Company, will
authenticate and make avail able for delivery the Definitive Securities, in
authorized denominations, and in an aggregate principal amount equal to the
principal amount of the Global Security in exchange for such Global Security.
Upon the exchange of the Global Security for such Definitive Securities, in
authorized denominations, the Global Security shall be cancelled by the
Trustee. Such Definitive Securities issued in exchange for the Global Security
shall be registered in such names and in such authorized denominations as the
Depositary, pursuant to instructions from its direct or indirect participants
or otherwise, shall instruct the Trustee. The Trustee shall deliver such
Definitive Securities to the Depositary for delivery to the Persons in whose
names such Definitive Securities are so registered.
SECTION 2.06 Interest.
(a) Each Security will bear interest at the rate of 8.17% per annum
(the "Coupon Rate") from the most recent date to which interest has been paid
or duly provided for or, if no interest has been paid or duly provided for,
from the Issue Date, until the principal thereof becomes due and payable, and
at the Coupon Rate on any overdue principal (and premium, if any) and (to the
extent that payment of such interest is enforceable under applicable law) on
any overdue installment of interest, compounded semi-annually, payable
(subject to the provisions of Article XVI) semi-annually in arrears on June 1
and December 1 of each year (each, an "Interest Payment Date") commencing on
December 1, 1997, to the Person in whose name such Security or any predecessor
Security is registered, at the close of business on the regular record date for
such interest installment, which shall be
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the May 15 or November 15 immediately preceding the relevant Interest Payment
Date.
(b) Interest will be computed on the basis of a 360-day year
consisting of twelve 30-day months and, for any period of less than six months,
the number of days lapsed in such period, based on 30-day months. In the event
that any Interest Payment Date falls on a day that 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), with the same force and effect as if made on such
date.
(c) During such time as the Property Trustee is the holder of any
Securities, the Company shall pay any additional amounts on the Securities as
may be necessary in order that the amount of Distributions then due and payable
by the AGL Capital Trust on the outstanding Securities shall not be reduced as
a result of any additional taxes, duties and other governmental charges to
which the AGL Capital Trust has become subject as a result of a Tax Event
("Additional Interest").
(d) Notwithstanding Section 2.06(c) above, neither the Company nor the
Trust will be responsible for, nor will the Company or the Trust be required to
compensate holders of or investors in the Capital Securities (or Securities
that may be distributed by the Trust) for, any withholding taxes that are
imposed on interest payments on the Securities or on distributions with
respect to the Capital Securities.
SECTION 2.07. Transfer and Exchange.
(a) Transfer Restrictions. The Series A Securities, and those Series B
Securities with respect to which any Person described in Section 2.04(b)(A),
(B) or (C) is the beneficial owner, may not be transferred except in compliance
with the legend contained in Exhibit A unless otherwise determined by the
Company in accordance with applicable law. Upon any distribution of the
Securities following a Dissolution Event, the Company and the Trustee shall
enter into a supplemental indenture pursuant to Section 9.01 to provide for the
transfer restrictions and procedures with respect to the Securities
substantially similar to those contained in the Declaration to the extent
applicable in the circumstances existing at such time.
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(b) General Provisions Relating to Transfers and Ex changes. The
Securities may only be transferred in minimum blocks of $100,000 aggregate
principal amount until such Securities are registered pursuant to an effective
registration statement filed under the Securities Act.
Upon surrender for registration of transfer of any Security at the
office or agency of the Company maintained for the purpose pursuant to Section
3.02, the Company shall execute, and the Trustee shall authenticate and make
available for delivery, in the name of the designated transferee or
transferees, one or more new Securities of the same series, of any authorized
denominations and of a like aggregate principal amount.
At the option of the holder, Securities of any series may be exchanged
for other Securities of the same series, of any authorized denominations and of
a like aggregate principal amount, upon surrender of the Securities to be
exchanged at such office or agency. Whenever any Securities are so surrendered
for exchange, the Company shall execute, and the Trustee shall authenticate and
make available for delivery, the Securities which the holder making the
exchange is entitled to receive.
Every Security presented or surrendered for registration of transfer
or exchange shall (if so required by the Company or the Trustee) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly executed, by the
holder thereof or his attorney duly authorized in writing.
All Definitive Securities and Global Securities issued upon any
registration of transfer or exchange of Definitive Securities or Global
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Definitive
Securities or Global Securities surrendered upon such registration of transfer
or exchange.
No service charge shall be made to a holder for any registration of
transfer or exchange, but the Company may require payment of a sum sufficient
to cover any transfer tax or similar governmental charge payable in connection
therewith.
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The Company shall not be required to (i) issue, register the transfer
of or exchange Securities during a period beginning at the opening of business
15 days before the day of mailing of a notice of redemption or any notice of
selection of Securities for redemption under Article XIV hereof and ending at
the close of business on the day of such mailing; or (ii) register the
transfer of or exchange any Security so selected for redemption in whole or in
part, except the unredeemed portion of any Security being redeemed in part.
(c) Exchange of Series A Securities for Series B Securities. The
Series A Securities may be exchanged for Series B Securities pursuant to the
terms of the Exchange Offer. The Trustee shall make the exchange as follows:
The Company shall present the Trustee with an Officers' Certificate
certifying the following:
(A) upon issuance of the Series B Securities, the transactions
contemplated by the Exchange Offer have been consummated; and
(B) the principal amount of Series A Securities properly
tendered in the Exchange Offer that are represented by a
Global Security and the principal amount of Series A
Securities properly tendered in the Exchange Offer that are
represented by Definitive Securities, the name of each
holder of such Definitive Securities, the principal amount
properly tendered in the Exchange Offer by each such holder
and the name and address to which Definitive Securities for
Series B Securities shall be registered and sent for each
such holder.
The Trustee, upon receipt of (i) such Officers' Certificate, (ii) an
Opinion of Counsel (x) to the effect that the Series B Securities have been
registered under Section 5 of the Securities Act and the Indenture has been
qualified under the Trust Indenture Act and (y) with respect to the matters set
forth in Section 3(p) of the Registration Rights Agreement and (iii) a Company
Order, shall authenticate (A) a Global Security for Series B Securities in
aggregate principal amount equal to the aggregate principal amount of Series A
Securities represented by a Global Security indicated in such Officers'
Certificate as having been properly tendered and (B) Definitive Securities
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representing Series B Securities registered in the names of, and in the
principal amounts indicated in, such Officers' Certificate.
If the principal amount of the Global Security for the Series B
Securities is less than the principal amount of the Global Security for the
Series A Securities, the Trustee shall make an endorsement on such Global
Security for Series A Securities indicating a reduction in the principal
amount represented thereby.
The Trustee shall deliver such Definitive Securities for Series B
Securities to the holders thereof as indicated in such Officers' Certificate.
SECTION 2.08. Replacement Securities.
If any mutilated Security is surrendered to the Trustee, or the
Company and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Security, the Company shall issue and the
Trustee shall authenticate a replacement Security if the Trustee's requirements
for replacements of Securities are met. An indemnity bond must be supplied by
the holder that is sufficient in the judgment of the Trustee and the Company to
protect the Company, the Trustee, any agent thereof or any authenticating agent
from any loss that any of them may suffer if a Security is replaced. The
Company or the Trustee may charge for its expenses in replacing a Security.
Every replacement Security is an obligation of the Company and shall
be entitled to all of the benefits of this Indenture equally and
proportionately with all other Securities duly issued hereunder.
SECTION 2.09. Temporary Securities.
Pending the preparation of Definitive Securities, the Company may
execute, and upon Company Order the Trustee shall authenticate and make
available for delivery, temporary Securities that are printed, lithographed,
typewritten, mimeographed or otherwise reproduced, in any authorized
denomination, substantially of the tenor of the Definitive Securities in lieu
of which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such
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Securities may determine, as conclusively evidenced by their execution of such
Securities.
If temporary Securities are issued, the Company shall cause Definitive
Securities to be prepared without unreasonable delay. The Definitive Securities
shall be printed, lithographed or engraved, or provided by any combination
thereof, or in any other manner permitted by the rules and regulations of any
applicable securities exchange, all as determined by the officers executing
such Definitive Securities. After the preparation of Definitive Securities, the
temporary Securities shall be ex changeable for Definitive Securities upon
surrender of the temporary Securities at the office or agency maintained by
the Company for such purpose pursuant to Section 3.02 hereof, without charge to
the Holder. Upon surrender for cancellation of any one or more temporary
Securities, the Company shall execute, and the Trustee shall authenticate and
make available for delivery, in exchange therefor the same aggregate principal
amount of Definitive Securities of authorized denominations. Until so
exchanged, the temporary Securities shall in all respects be entitled to the
same benefits under this Indenture as Definitive Securities.
SECTION 2.10. Cancellation.
The Company at any time may deliver Securities to the Trustee for
cancellation. The Trustee and no one else shall cancel all Securities
surrendered for registration of transfer, exchange, payment, replacement or
cancellation and shall retain or dispose of cancelled Securities in accordance
with its normal practices (subject to the record retention requirement of the
Exchange Act) unless the Company directs them to be returned to it. The Company
may not issue new Securities to replace Securities that have been redeemed or
paid or that have been delivered to the Trustee for cancellation.
SECTION 2.11. Defaulted Interest.
Any interest on any Security that is payable, but is not punctually
paid or duly provided for, on any Interest Payment Date (herein called
"Defaulted Interest") shall forthwith cease to be payable to the holder on the
relevant regular record date by virtue of having been such holder; and such
Defaulted Interest shall be paid by the Company, at its election, as provided
in clause (a) or clause (b) below:
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(a) The Company may make payment of any Defaulted Interest on
Securities to the Persons in whose names such Securities (or their respective
Predecessor Securities) are registered at the close of business on a special
record date for the payment of such Defaulted Interest, which shall be fixed in
the following manner: the Company shall notify the Trustee in writing of the
amount of Defaulted Interest proposed to be paid on each such Security and the
date of the proposed payment, and at the same time the Company shall deposit
with the Trustee an amount of money equal to the aggregate amount proposed to
be paid in respect of such Defaulted Interest or shall make arrangements
satisfactory to the Trustee for such deposit prior to the date of the proposed
payment, such money when deposited to be held in trust for the benefit of the
Persons entitled to such Defaulted Interest as in this clause provided.
Thereupon the Trustee shall fix a special record date for the payment of such
Defaulted Interest which shall not be more than 15 nor less than 10 days prior
to the date of the proposed payment and not less than 10 days after the receipt
by the Trustee of the notice of the proposed payment. The Trustee shall
promptly notify the Company of such special record date and, in the name and at
the expense of the Company, shall cause notice of the proposed payment of such
Defaulted Interest and the special record date therefor to be mailed, first
class postage prepaid, to each Securityholder at his or her address as it
appears in the Security Register, not less than 10 days prior to such special
record date. Notice of the proposed payment of such Defaulted Interest and the
special record date therefor having been mailed as aforesaid, such Defaulted
Interest shall be paid to the Persons in whose names such Securities (or their
respective Predecessor Securities) are registered on such special record date
and shall be no longer payable pursuant to the following clause (b).
(b) The Company may make payment of any Defaulted Interest on any
Securities in any other lawful manner not inconsistent with the requirements of
any securities ex change on which such Securities may be listed, and upon such
notice as may be required by such exchange, if, after notice given by the
Company to the Trustee of the proposed payment pursuant to this clause, such
manner of payment shall be deemed practicable by the Trustee.
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SECTION 2.12. CUSIP Numbers.
The Company in issuing the Securities may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Securityholders; provided that any such
notice may state that no representation is made as to the correctness of such
numbers either as printed on the Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be
affected by any defect in or omission of such numbers. The Company will
promptly notify the Trustee of any change in the CUSIP numbers.
ARTICLE III
PARTICULAR COVENANTS OF THE COMPANY
SECTION 3.01. Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of the holders of the
Securities that it will duly and punctually pay or cause to be paid the
principal of and premium, if any, and interest on the Securities at the place,
at the respective times and in the manner provided herein. Except as provided
in Section 2.03, each installment of interest on the Securities may be paid by
mailing checks for such interest payable to the order of the holder of Security
entitled thereto as they appear in the Security Register. The Company further
covenants to pay any and all amounts including, without limitation, Liquidated
Damages, if any, on the dates and in the manner required under the Registra-
tion Rights Agreement.
SECTION 3.02. Offices for Notices and Payments, etc.
So long as any of the Securities remain outstanding, the Company will
maintain in the Borough of Manhattan, The City of New York, an office or agency
where the Securities may be presented for payment, an office or agency where
the Securities may be presented for registration of transfer and for exchange
as in this Indenture provided and an office or agency where notices and demands
to or upon the Company in respect of the Securities or of this Indenture may be
served. The Company will give to the
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Trustee written notice of the location of any such office or agency and of any
change of location thereof. Until otherwise designated from time to time by the
Company in a notice to the Trustee, any such office or agency for all of the
above purposes shall be the Principal Office of the Trustee. In case the
Company shall fail to maintain any such office or agency in the Borough of
Manhattan, The City of New York, or shall fail to give such notice of the
location or of any change in the location thereof, presentations and demands
may be made and notices may be served at the Principal Office of the Trustee.
In addition to any such office or agency, the Company may from time to
time designate one or more offices or agencies outside the Borough of
Manhattan, The City of New York, where the Securities may be presented for
payment, registration of transfer and for exchange in the manner provided in
this Indenture, and the Company may from time to time rescind such designation,
as the Company may deem desirable or expedient; provided, however, that no such
designation or rescission shall in any manner relieve the Company of its
obligation to maintain any such office or agency in the Borough of Manhattan,
The City of New York, for the purposes above mentioned. The Company will give
to the Trustee prompt written notice of any such designation or rescission
thereof.
SECTION 3.03. Appointments to Fill Vacancies in Trustee's Office.
The Company, whenever necessary to avoid or fill a vacancy in the
office of Trustee, will appoint, in the manner provided in Section 6.10, a
Trustee, so that there shall at all times be a Trustee hereunder.
SECTION 3.04. Provision as to Paying Agent.
(a) If the Company shall appoint a paying agent other than the
Trustee with respect to the Securities, it will cause such
paying agent to execute and deliver to the Trustee an
instrument in which such agent shall agree with the Trustee,
subject to the provision of this Section 3.04,
(1) that it will hold all sums held by it as such agent
for the payment of the principal of and premium, if
any, or interest on the Securi-
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ties (whether such sums have been paid to
it by the Company or by any other obligor
on the Securities of such series) in trust
for the benefit of the holders of the
Securities;
(2) that it will give the Trustee notice of any
failure by the Company (or by any other
obligor on the Securities) to make any
payment of the principal of and premium or
interest on the Securities when the same
shall be due and payable; and
(3) that it will at any time during the continu-
ance of any such failure, upon the written
request of the Trustee, forthwith pay to
the Trustee all sums so held in trust by it
as such paying agent.
(b) If the Company shall act as its own paying agent,
it will, on or before each due date of the princi-
pal of and premium, if any, or interest on the
Securities, set aside, segregate and hold in trust
for the benefit of the holders of the Securities a
sum sufficient to pay such principal, premium or
interest so becoming due and will notify the
Trustee of any failure to take such action and of
any failure by the Company (or by any other obli-
gor under the Securities) to make any payment of
the principal of and premium, if any, or interest
on the Securities when the same shall become due
and payable.
(c) Anything in this Section 3.04 to the contrary
notwithstanding, the Company may, at any time, for
the purpose of obtaining a satisfaction and dis-
charge with respect to the Securities hereunder,
or for any other reason, pay or cause to be paid
to the Trustee all sums held in trust for any such
series by the Trustee or any paying agent hereun-
der, as required by this Section 3.04, such sums
to be held by the Trustee upon the trusts herein
contained.
(d) Anything in this Section 3.04 to the contrary
notwithstanding, the agreement to hold sums
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in trust as provided in this Section 3.04 is subject
to Sections 11.03 and 11.04.
SECTION 3.05. Certificate to Trustee.
The Company will deliver to the Trustee on or before 120 days after
the end of each fiscal year in each year, commencing with the first fiscal
year ending after the date hereof, so long as Securities are outstanding
hereunder, an Officers' Certificate, one of the signers of which shall be the
principal executive, principal financial or principal accounting officer of the
Company stating that in the course of the performance by the signers of their
duties as officers of the Company they would normally have knowledge of any
default by the Company in the performance of any covenants contained herein,
stating whether or not they have knowledge of any such default and, if so,
specifying each such default of which the signers have knowledge and the
nature thereof.
SECTION 3.06. Compliance with Consolidation Provisions.
The Company will not, while any of the Securities remain outstanding,
consolidate with, or merge into, or merge into itself, or sell or convey all or
substantially all of its property to any other Person unless the provisions of
Article X hereof are complied with.
SECTION 3.07. Limitation on Dividends.
The Company will not (i) declare or pay any dividends or distributions
on, or redeem, purchase, acquire, or make a liquidation payment with respect
to, any of the Company's capital stock (which includes common and preferred
stock) or (ii) make any payment of principal, interest or premium, if any, on
or repay or repurchase or redeem any debt securities of the Company (including
any Other Debentures) that rank pari passu with or junior in right of payment
to the Securities or (iii) make any guarantee payments with respect to any
guarantee by the Company of any securities of any Subsidiary of the Company
(including any Other Guarantees) if such guarantee ranks pari passu or junior
in right of payment to the Securities (other than (a) dividends or
distributions in shares of, or options, warrants or rights to subscribe for or
purchase shares of, Common Stock of the Company; (b) any declaration of a
dividend in connection with the imple-
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mentation of a stockholder's rights plan, or the issuance of stock under any
such plan in the future, or the redemption or repurchase of any such rights
pursuant thereto; (c) payments under the Capital Securities Guarantee; (d) as a
direct result of, and only to the extent required in order to avoid the issu-
ance of fractional shares of capital stock, following a reclassification of
the Company's capital stock or the exchange or conversion of one class or
series of the Company's capital stock for another class or series of the
Company's capital stock; and (e) the purchase of fractional interests in shares
of the Company's capital stock pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged)
if at such time (i) there shall have occurred and be continuing a Declaration
Event of Default, (ii) there shall have occurred and be continuing an Event of
Default, (iii) there shall have occurred and be continuing a payment default
under the Declaration or the Indenture, (iv) if such Securities are held by AGL
Capital Trust, the Company shall be in default with respect to its payment of
any obligations under the Capital Securities Guarantee, or (v) the Company
shall have given notice of its election of the exercise of its right to extend
the interest payment period, or any extension thereof, pursuant to Section
16.01 and shall not have rescinded such notice, and such exercise of its right
to extend the interest payment period, or any extension thereof, shall have
commenced.
SECTION 3.08. Covenants as to AGL Capital Trust.
In the event Securities are issued to AGL Capital Trust or a trustee
of such trust in connection with the issuance of Trust Securities by AGL
Capital Trust, for so long as such Trust Securities remain outstanding, the
Company will (i) maintain 100% direct ownership of the Common Securities of AGL
Capital Trust; provided, however, that any successor of the Company, permitted
pursuant to Article X, may succeed to the Company's ownership of such Common
Securities, (ii) not cause, as sponsor of AGL Capital Trust or permit, as a
holder of Common Securities, the dissolution, winding up or termination of the
Trust, except in connection with a distribution of the Securities to holders of
Trust Securities, as provided in the Declaration; (iii) use its reasonable
efforts to cause AGL Capital Trust (a) to remain a business trust, except in
connection with a distribution of Securities, the redemption of all of the
Trust Securities or certain mergers, consolidations or amalgamations, each as
permitted by the Declaration and (b) to otherwise continue to be
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treated as a grantor trust and not an association taxable as a corporation for
United States federal income tax purposes and (iv) use its reasonable efforts
to cause each holder of Trust Securities to be treated as owning an undivided
beneficial interest in the Securities.
SECTION 3.09. Payment of Expenses.
In connection with the offering, sale and issuance of the Securities
to the AGL Capital Trust and in connection with the sale of the Trust
Securities by the AGL Capital Trust, the Company, in its capacity as borrower
with respect to the Securities, shall:
(a) pay all costs and expenses relating to the offering, sale and
issuance of the Securities, including commissions to the initial purchasers
payable pursuant to the Purchase Agreement, fees and expenses in connection
with any exchange offer or other action to be taken pursuant to the
Registration Rights Agreement and compensation of the Trustee in accordance
with the provisions of Section 6.06;
(b) pay all costs and expenses of the AGL Capital Trust (including,
but not limited to, costs and expenses relating to the organization of the AGL
Capital Trust, the offering, sale and issuance of the Trust Securities
(including commissions to the initial purchasers 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 AGL Capital 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),
duplicating, travel and telephone and other telecommunications expenses and
costs and expenses incurred in connection with the acquisition, financing, and
disposition of assets of the AGL Capital Trust;
(c) be primarily and fully liable for any indemnification obligations
arising with respect to the Declaration;
(d) pay any and all taxes (other than United States withholding taxes
attributable to the AGL Capital Trust or its assets) and all liabilities, costs
and expenses with respect to such taxes of the AGL Capital Trust; and
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(e) pay all other fees, expenses, debts and obligations (other than
payments of principal of, premium, if any, or interest on the Trust Securities)
related to AGL Capital Trust.
SECTION 3.10. Payment Upon Resignation or Removal.
Upon termination of this Indenture or the removal or resignation of
the Trustee, unless otherwise stated, the Company shall pay to the Trustee all
amounts accrued and owing to the date of such termination, removal or
resignation. Upon termination of the Declaration or the removal or resignation
of the Delaware Trustee or the Property Trustee, as the case may be, pursuant
to Section 5.7 of the Declaration, the Company shall pay to the Delaware
Trustee or the Property Trustee, as the case may be, all amounts accrued and
owing to the date of such termination, removal or resignation.
ARTICLE IV
SECURITYHOLDERS' LISTS AND REPORTS BY THE
COMPANY AND THE TRUSTEE
SECTION 4.01. Securityholders' Lists.
The Company covenants and agrees that it will furnish or cause to be
furnished to the Trustee:
(a) on a semi-annual basis on each regular record date for the
Securities, a list, in such form as the Trustee may
reasonably require, of the names and addresses of the
Securityholders as of such record date; and
(b) at such other times as the Trustee may request in writing,
within 30 days after the receipt by the Company, of any such
request, a list of similar form and content as of a date not
more than 15 days prior to the time such list is furnished,
except that, no such lists need be furnished so long as the Trustee is
in possession thereof by reason of its acting as Security registrar.
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SECTION 4.02. Preservation and Disclosure of Lists.
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, all information as to the names and
addresses of the holders of the Securities (1) contained in
the most recent list furnished to it as provided in Section
4.01 or (2) received by it in the capacity of Securities reg-
istrar (if so acting) hereunder. The Trustee may destroy any
list furnished to it as provided in Section 4.01 upon receipt
of a new list so furnished.
(b) In case three or more holders of Securities (hereinafter
referred to as "applicants") apply in writing to the Trustee
and furnish to the Trustee reasonable proof that each such
applicant has owned a Security for a period of at least six
months preceding the date of such application, and such
application states that the applicants desire to communicate
with other holders of Securities or with holders of all
Securities with respect to their rights under this Indenture
and is accompanied by a copy of the form of proxy or other
communication which such applicants propose to transmit,
then the Trustee shall within 5 Business Days after the
receipt of such application, at its election, either:
(1) afford such applicants access to the information preserved at
the time by the Trustee in accordance with the provisions of
subsection (a) of this Section 4.02, or
(2) inform such applicants as to the approximate number of
holders of all Securities, whose names and addresses appear
in the information preserved at the time by the Trustee in
accordance with the provisions of subsection (a) of this
Section 4.02, and as to the approximate cost of mailing to
such Securityholders the form of proxy or other commu-
nication, if any, specified in such application.
If the Trustee shall elect not to afford such
applicants access to such information, the Trustee
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shall, upon the written request of such applicants, mail to
each Securityholder whose name and address appear in the
information preserved at the time by the Trustee in
accordance with the provisions of subsection (a) of this
Section 4.02 a copy of the form of proxy or other
communication which is specified in such request with
reasonable promptness after a tender to the Trustee of the
material to be mailed and of payment, or provision for the
payment, of the reasonable expenses of mailing, unless within
five days after such tender, the Trustee shall mail to such
applicants and file with the Commission, together with a copy
of the material to be mailed, a written statement to the
effect that, in the opinion of the Trustee, such mailing
would be contrary to the best interests of the holders of
Securities of such series or all Securities, as the case may
be, or would be in violation of applicable law. Such written
statement shall specify the basis of such opinion. If the
Commission, after opportunity for a hearing upon the
objections specified in the written statement so filed, shall
enter an order refusing to sustain any of such objections or
if, after the entry of an order sustaining one or more of
such objections, the Commission shall find, after notice and
opportunity for hearing, that all the objections so sustained
have been met and shall enter an order so declaring, the
Trustee shall mail copies of such material to all such
Securityholders with reasonable promptness after the entry of
such order and the renewal of such tender; otherwise the
Trustee shall be relieved of any obligation or duty to such
applicants respecting their application.
(c) Each and every holder of Securities, by receiving and holding
the same, agrees with the Company and the Trustee that
neither the Company nor the Trustee nor any paying agent
shall be held accountable by reason of the disclosure of any
such information as to the names and addresses of the holders
of Securities in accordance with the pro visions of
subsection (b) of this Section 4.02, regardless of the source
from which such informa-
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tion was derived, and that the Trustee shall not be held
accountable by reason of mailing any material pursuant to a
request made under said subsection (b).
SECTION 4.03. Reports by Company.
(a) The Company covenants and agrees to file with the Trustee,
within 15 days after the date on which the Company is
required to file the same with the Commission, copies of the
annual reports and of the information, documents and other
reports (or copies of such portions of any of the foregoing
as said Commission may from time to time by rules and
regulations prescribe) which the Company may be required to
file with the Commission pursuant to Section 13 or Section
15(d) of the Exchange Act; or, if the Company is not required
to file information, documents or reports pursuant to either
of such sections, then to file with the Trustee and the
Commission, in accordance with rules and regulations
prescribed from time to time by the Commission, such of the
supplementary and periodic information, documents and reports
which may be required pursuant to Section 13 of the Exchange
Act in respect of a security listed and registered on a
national securities exchange as may be prescribed from time
to time in such rules and regulations.
(b) The Company covenants and agrees to file with the Trustee and
the Commission, in accordance with the rules and regulations
prescribed from time to time by said Commission, such
additional information, documents and reports with respect to
compliance by the Company with the conditions and covenants
provided for in this Indenture as may be required from time
to time by such rules and regulations.
(c) The Company covenants and agrees to transmit by mail to all
holders of Securities, as the names and addresses of such
holders appear upon the Security Register, within 30 days
after the filing thereof with the Trustee, such summaries of
any information, documents and reports required to be
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<PAGE> 44
filed by the Company pursuant to subsections (a) and (b) of
this Section 4.03 as may be required by rules and regulations
prescribed from time to time by the Commission.
(d) Delivery of such reports, information and documents to the
Trustee is for informational purposes only and the Trustee's
receipt of such shall not constitute constructive notice of
any information contained therein or determinable from
information contained therein, including the Company's compli-
ance with any of its covenants hereunder (as to which the
Trustee is entitled to rely exclusively on Officers'
Certificates).
(e) So long as is required for an offer or sale of the Securities
to qualify for an exemption under Rule 144A under the
Securities Act, the Company shall, upon request, provide the
information required by clause (d)(4) thereunder to each
Holder and to each beneficial owner and prospective purchaser
of Securities identified by any holder of Restricted
Securities, unless such information is furnished to the
Commission pursuant to Section 13 or 15(d) of the Exchange
Act.
SECTION 4.04. Reports by the Trustee.
(a) The Trustee shall transmit to Securityholders such reports
concerning the Trustee and its actions under this Indenture
as may be required pursuant to the Trust Indenture Act at the
times and in the manner provided pursuant thereto. If
required by Section 313(a) of the Trust Indenture Act, the
Trustee shall, within sixty days after each May 15 following
the date of this Indenture, commencing May 15, 1998, deliver
to Securityholders a brief report, dated as of such May 15,
which complies with the provisions of such Section 313(a).
(b) A copy of each such report shall, at the time of such
transmission to Securityholders, be filed by the Trustee with
each stock exchange, if any, upon which the Securities are
listed, with the Commission and with the Company. The
Company will
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promptly notify the Trustee when the Securities are listed on
any stock exchange.
ARTICLE V
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 5.01. Events of Default.
One or more of the following events of default shall constitute an
Event of Default hereunder (whatever the reason for such Event of Default and
whether it shall be voluntary or be effected by operation of law or pursuant to
any judgment, decree or order of any court or any order, rule or regulation of
any administrative or governmental body):
(a) default in the payment of any interest upon any Security or
any Other Debentures when it becomes due and payable, and
continuance of such default for a period of 30 days;
provided, however, that a valid extension of an interest
payment period by the Company in accordance with the terms
hereof shall not constitute a default in the payment of
interest for this purpose; or
(b) default in the payment of all or any part of the principal of
(or premium, if any, on) any Security or any Other Debentures
as and when the same shall become due and payable either at
maturity, upon redemption, by declaration or otherwise; or
(c) default in the performance, or breach, of any covenant or
warranty of the Company in this Indenture (other than a
covenant or warranty a default in whose performance or whose
breach is elsewhere in this Section specifically dealt with),
and continuance of such default or breach for a period of 90
days after there has been given, by registered or certified
mail, to the Company by the Trustee or to the Company and the
Trustee by the holders of at least 25% in aggregate principal
amount of the outstanding Securities a written notice
specifying such default or breach and re-
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quiring it to be remedied and stating that such notice is a
"Notice of Default" hereunder; or
(d) a court having jurisdiction in the premises shall enter a
decree or order for relief in respect of the Company in an
involuntary case under any applicable bankruptcy, insolvency
or other similar law now or hereafter in effect, or
appointing a receiver, liquidator, assignee, custodian,
trustee, sequestrator (or similar official) of the Company or
for any substantial part of its proper ty, or ordering the
winding-up or liquidation of its affairs and such decree or
order shall remain unstayed and in effect for a period of 90
consecutive days; or
(e) the Company shall commence a voluntary case under any
applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, shall consent to the entry of an order
for relief in an involuntary case under any such law, or
shall consent to the appointment of or taking possession by a
receiver, liquidator, assignee, trustee, custodian,
sequestrator (or other similar official) of the Company or
of any substantial part of its property, or shall make any
general assignment for the benefit of creditors, or shall
fail generally to pay its debts as they become due.
If an Event of Default with respect to Securities at the time
outstanding occurs and is continuing, then in every such case the Trustee or
the holders of not less than 25% in aggregate principal amount of the
Securities then outstanding may declare the principal amount of all Securities
to be due and payable immediately, by a notice in writing to the Company (and
to the Trustee if given by the holders of the outstanding Securities), and upon
any such declaration the same shall become immediately due and payable.
The foregoing provisions, however, are subject to the condition that
if, at any time after the principal of the Securities shall have been so
declared due and payable, and before any judgment or decree for the payment of
the moneys due shall have been obtained or entered as hereinafter provided, (i)
the Company shall pay or shall deposit with the Trustee a sum sufficient to
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pay (A) all matured installments of interest upon all the Securities and the
principal of and premium, if any, on any and all Securities which shall have
become due otherwise than by acceleration (with interest upon such principal
and premium, if any, and, to the extent that payment of such interest is
enforceable under applicable law, on overdue installments of interest, at the
same rate as the rate of interest specified in the Securities to the date of
such payment or deposit) and (B) such amount as shall be sufficient to cover
reasonable compensation to the Trustee and each predecessor Trustee, their
respective agents, attorneys and counsel, and all other expenses and
liabilities incurred, and all advances made, by the Trustee and each
predecessor Trustee except as a result of negligence or bad faith, and (ii) any
and all Events of Default under the Indenture, other than the non-payment of
the principal of the Securities which shall have become due solely by such
declaration of acceleration, shall have been cured, waived or otherwise
remedied as provided herein, then, in every such case, the holders of a
majority in aggregate principal amount of the Securities then outstanding, by
written notice to the Company and to the Trustee, may rescind and annul such
declaration and its consequences, but no such waiver or rescission and
annulment shall extend to or shall affect any subsequent default or shall
impair any right consequent thereon.
In case the Trustee shall have proceeded to enforce any right under
this Indenture and such proceedings shall have been discontinued or abandoned
because of such rescission or annulment or for any other reason or shall have
been determined adversely to the Trustee, then and in every such case the
Company, the Trustee and the holders of the Securities shall be restored
respectively to their several positions and rights hereunder, and all rights,
remedies and powers of the Company, the Trustee and the holders of the
Securities shall continue as though no such proceeding had been taken.
SECTION 5.02. Payment of Securities on Default; Suit Therefor.
The Company covenants that (a) in case default shall be made in the
payment of any installment of interest upon any of the Securities as and when
the same shall become due and payable, and such default shall have continued
for a period of 30 days, or (b) in case default shall be made in the payment of
the principal of or premium, if any, on any of the Securities as and when the
same shall have become due and payable, whether at maturity of
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the Securities or upon redemption or by declaration or otherwise, then, upon
demand of the Trustee, the Company will pay to the Trustee, for the benefit of
the holders of the Securities, the whole amount that then shall have become due
and payable on all such Securities for principal and premium, if any, or
interest, or both, as the case may be, with interest upon the overdue principal
and premium, if any, and (to the extent that payment of such interest is
enforceable under applicable law and, if the Securities are held by AGL Capital
Trust or a trustee of such trust, without duplication of any other amounts paid
by AGL Capital Trust or a trustee in respect thereof) upon the overdue
installments of interest at the rate borne by the Securities; and, in addition
thereto, such further amount as shall be sufficient to cover the costs and
expenses of collection, including a reasonable compensation to the Trustee, its
agents, attorneys and counsel, and any expenses or liabilities incurred by the
Trustee hereunder other than through its negligence or bad faith.
In case the Company shall fail forthwith to pay such amounts upon such
demand, the Trustee, in its own name and as trustee of an express trust, shall
be entitled and empowered to institute any actions or proceedings at law or in
equity for the collection of the sums so due and unpaid, and may prosecute any
such action or proceeding to judgment or final decree, and may enforce any such
judgment or final decree against the Company or any other obligor on the
Securities and collect in the manner provided by law out of the property of the
Company or any other obligor on the Securities wherever situated the moneys
adjudged or decreed to be payable.
In case there shall be pending proceedings for the bankruptcy or for
the reorganization of the Company or any other obligor on the Securities under
Title 11, United States Code, or any other applicable law, or in case a
receiver or trustee shall have been appointed for the property of the Company
or such other obligor, or in the case of any other similar judicial proceedings
relative to the Company or other obligor upon the Securities, or to the
creditors or property of the Company or such other obligor, the Trustee,
irrespective of whether the principal of the Securities shall then be due and
payable as therein expressed or by declaration or otherwise and irrespective of
whether the Trustee shall have made any demand pursuant to the provisions of
this Section 5.02, shall be entitled and empowered, by intervention in such
proceedings or otherwise, to file and prove a claim or claims for the whole
amount of principal and interest owing
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and unpaid in respect of the Securities and, in case of any judicial
proceedings, to file such proofs of claim and other papers or documents as may
be necessary or advisable in order to have the claims of the Trustee (including
any claim for reason able compensation to the Trustee and each predecessor
Trustee, and their respective agents, attorneys and counsel, and for
reimbursement of all expenses and liabilities incurred, and all advances made,
by the Trustee and each predecessor Trustee, except as a result of negligence
or bad faith) and of the Securityholders allowed in such judicial proceedings
relative to the Company or any other obligor on the Securities, or to the
creditors or property of the Company or such other obligor, unless prohibited
by applicable law and regulations, to vote on behalf of the holders of the
Securities in any election of a trustee or a standby trustee in arrangement,
reorganization, liquidation or other bankruptcy or insolvency proceedings or
person performing similar functions in comparable proceedings, and to collect
and receive any moneys or other property payable or deliverable on any such
claims, and to distribute the same after the deduction of its charges and
expenses; and any receiver, assignee or trustee in bankruptcy or
reorganization is hereby authorized by each of the Securityholders to make such
payments to the Trustee, and, in the event that the Trustee shall consent to
the making of such payments directly to the Securityholders, to pay to the
Trustee such amounts as shall be sufficient to cover reasonable compensation to
the Trustee, each predecessor Trustee and their respective agents, attorneys
and counsel, and all other expenses and liabilities incurred, and all advances
made, by the Trustee and each predecessor Trustee except as a result of
negligence or bad faith.
Nothing herein contained shall be construed to authorize the Trustee
to authorize or consent to or accept or adopt on behalf of any Securityholder
any plan of reorganization, arrangement, adjustment or composition affecting
the Securities or the rights of any holder thereof or to authorize the Trustee
to vote in respect of the claim of any Securityholder in any such proceeding.
All rights of action and of asserting claims under this Indenture, or
under any of the Securities, may be enforced by the Trustee without the
possession of any of the Securities, or the production thereof on any trial or
other proceeding relative thereto, and any such suit or proceeding instituted
by the Trustee shall be brought in its own name as trustee of an express
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trust, and any recovery of judgment shall be for the ratable benefit of the
holders of the Securities.
In any proceedings brought by the Trustee (and also any proceedings
involving the interpretation of any provision of this Indenture to which the
Trustee shall be a party) the Trustee shall be held to represent all the
holders of the Securities, and it shall not be necessary to make any holders of
the Securities parties to any such proceedings.
SECTION 5.03. Application of Moneys Collected by Trustee.
Any moneys collected by the Trustee shall be applied in the order
following, at the date or dates fixed by the Trustee for the distribution of
such moneys, upon presentation of the Securities in respect of which moneys
have been collected, and stamping thereon the payment, if only partially paid,
and upon surrender thereof if fully paid:
First: To the payment of costs and expenses of collection applicable
to the Securities and reasonable compensation to the Trustee, its agents,
attorneys and counsel, and of all other expenses and liabilities incurred, and
all advances made, by the Trustee except as a result of its negligence or bad
faith;
Second: To the payment of all Senior Indebtedness of the Company if
and to the extent required by Article XV;
Third: To the payment of the amounts then due and unpaid upon
Securities for principal of (and premium, if any) and interest on the
Securities, in respect of which or for the benefit of which money has been
collected, ratably, without preference of priority of any kind, according to
the amounts due on such Securities for principal (and premium, if any) and
interest, respectively; and
Fourth: To the Company.
SECTION 5.04. Proceedings by Securityholders.
No holder of any Security shall have any right by virtue of or by
availing of any provision of this Indenture to institute any suit, action or
proceeding in equity or at law upon
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or under or with respect to this Indenture or for the appointment of a receiver
or trustee, or for any other remedy hereunder, unless such holder previously
shall have given to the Trustee written notice of an Event of Default and of
the continuance thereof with respect to the Securities specifying such Event of
Default, as hereinbefore provided, and unless also the holders of not less than
25% in aggregate principal amount of the Securities then outstanding shall have
made written request upon the Trustee to institute such action, suit or
proceeding in its own name as Trustee hereunder and shall have offered to the
Trustee such reasonable indemnity as it may require against the costs, expens
es and liabilities to be incurred therein or thereby, and the Trustee for 60
days after its receipt of such notice, request and offer of indemnity shall
have failed to institute any such action, suit or proceeding, it being
understood and intended, and being expressly covenanted by the taker and holder
of every Security with every other taker and holder and the Trustee, that no
one or more holders of Securities shall have any right in any manner whatever
by virtue of or by availing of any provision of this Indenture to affect,
disturb or prejudice the rights of any other holder of Securities, or to obtain
or seek to obtain priority over or preference to any other such holder, or to
enforce any right under this Indenture, except in the manner herein provided
and for the equal, ratable and common benefit of all holders of Securities.
Notwithstanding any other provisions in this Indenture, however, the
right of any holder of any Security to receive payment of the principal of
(premium, if any) and interest on such Security, on or after the same shall
have become due and payable, or to institute suit for the enforcement of any
such payment, shall not be impaired or affected without the consent of such
holder and by accepting a Security hereunder it is expressly understood,
intended and covenanted by the taker and holder of every Security with every
other such taker and holder and the Trustee, that no one or more holders of
Securities shall have any right in any manner whatsoever by virtue or by
availing of any provision of this Indenture to affect, disturb or prejudice the
rights of the holders of any other Securities, or to obtain or seek to obtain
priority over or preference to any other such holder, or to enforce any right
under this Indenture, except in the manner herein provided and for the equal,
ratable and common benefit of all holders of Securities. For the protection and
enforcement of the provisions of this Section, each and every
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Securityholder and the Trustee shall be entitled to such relief as can be given
either at law or in equity.
The Company and the Trustee acknowledge that pursuant to the
Declaration, the holders of Capital Securities are entitled, in the
circumstances and subject to the limitations set forth therein, to commence a
Direct Action with respect to any Event of Default under this Indenture and the
Securities.
SECTION 5.05. Proceedings by Trustee.
In case an Event of Default occurs with respect to Securities and is
continuing, the Trustee may in its discretion proceed to protect and enforce
the rights vested in it by this Indenture by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect and enforce any
of such rights, either by suit in equity or by action at law or by proceeding
in bankruptcy or otherwise, whether for the specific enforcement of any
covenant or agreement contained in this Indenture or in aid of the exercise of
any power granted in this Indenture, or to enforce any other legal or equitable
right vested in the Trustee by this Indenture or by law.
SECTION 5.06. Remedies Cumulative and Continuing.
All powers and remedies given by this Article V to the Trustee or to
the Securityholders shall, to the extent permitted by law, be deemed cumulative
and not exclusive of any other powers and remedies available to the Trustee or
the holders of the Securities, by judicial proceedings or otherwise, to enforce
the performance or observance of the covenants and agreements contained in this
Indenture or otherwise established with respect to the Securities, and no delay
or omission of the Trustee or of any holder of any of the Securities to
exercise any right or power accruing upon any Event of Default occurring and
continuing as aforesaid shall impair any such right or power, or shall be
construed to be a waiver of any such default or an acquiescence therein; and,
subject to the provisions of Section 5.04, every power and remedy given by this
Article V or by law to the Trustee or to the Securityholders may be exercised
from time to time, and as often as shall be deemed expedient, by the Trustee or
by the Securityholders.
SECTION 5.07. Direction of Proceedings and Waiver of
Defaults by Majority of Securityholders.
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The holders of a majority in aggregate principal amount of the
Securities at the time outstanding shall have the right to direct the time,
method, and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred on the Trustee; provided,
however, that (subject to the provisions of Section 6.01) the Trustee shall
have the right to decline to follow any such direction if the Trustee shall
determine that the action so directed would be unjustly prejudicial to the
holders not taking part in such direction or if the Trustee being advised by
counsel determines that the action or proceeding so directed may not lawfully
be taken or if the Trustee in good faith by its board of directors or trustees,
executive committee, or a trust committee of directors or trustees and/or
Responsible Officers shall determine that the action or proceedings so directed
would involve the Trustee in personal liability. Prior to any declaration
accelerating the maturity of the Securities, the holders of a majority in aggre-
gate principal amount of the Securities at the time outstanding may on behalf
of the holders of all of the Securities waive any past default or Event of
Default and its consequences except a default (a) in the payment of principal
of or premium, if any, or interest on any of the Securities or (b) in respect
of covenants or provisions hereof which cannot be modified or amended without
the consent of the holder of each Security affected; provided, however, that if
the Securities are held by the Property Trustee, such waiver or modification to
such waiver shall not be effective until the holders of a majority in aggregate
liquidation amount of Trust Securities shall have consented to such waiver or
modification to such waiver; provided further, that if the consent of the
holder of each outstanding Security is required, such waiver shall not be
effective until each holder of the Trust Securities shall have consented to
such waiver. Upon any such waiver, the default covered thereby shall be deemed
to be cured for all purposes of this Indenture and the Company, the Trustee and
the holders of the Securities shall be restored to their former positions and
rights hereunder, respectively; but no such waiver shall extend to any
subsequent or other default or impair any right consequent thereon. Whenever
any default or Event of Default hereunder shall have been waived as permitted
by this Section 5.07, said default or Event of Default shall for all purposes
of the Securities and this Indenture be deemed to have been cured and to be not
continuing.
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SECTION 5.08. Notice of Defaults.
The Trustee shall, within 90 days after the occurrence of a default
with respect to the Securities mail to all Securityholders, as the names and
addresses of such holders appear upon the Security register, notice of all
defaults known to the Trustee, unless such defaults shall have been cured
before the giving of such notice (the term "defaults" for the purpose of this
Section 5.08 being hereby defined to be the events specified in clauses (a),
(b), (c), (d) and (e) of Section 5.01, not including periods of grace, if any,
provided for therein, and irrespective of the giving of written notice
specified in clause (c) of Section 5.01); and provided that, except in the case
of default in the payment of the principal of or premium, if any, or interest
on any of the Securities, the Trustee shall be protected in withholding such
notice if and so long as the board of directors, the executive committee, or a
trust committee of directors and/or Responsible Officers of the Trustee in good
faith deter mines that the withholding of such notice is in the interests of
the Securityholders; and provided further, that in the case of any default of
the character specified in Section 5.01(c) no such notice to Securityholders
shall be given until at least 60 days after the occurrence thereof but shall be
given within 90 days after such occurrence.
SECTION 5.09. Undertaking to Pay Costs.
All parties to this Indenture agree, and each holder of any Security
by his acceptance thereof shall be deemed to have agreed, that any court may in
its discretion require, in any suit for the enforcement of any right or remedy
under this Indenture, or in any suit against the Trustee for any action taken
or omitted by it as Trustee, the filing by any party litigant in such suit of
an undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees and
expenses, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party litigant;
but the provisions of this Section 5.09 shall not apply to any suit instituted
by the Trustee, to any suit instituted by any Securityholder, or group of
Securityholders, holding in the aggregate more than 25% in aggregate principal
amount of the Securities outstanding, or to any suit instituted by any
Securityholder for the enforcement of the payment of the principal of (or
premium, if any) or interest on any Security against
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the Company on or after the same shall have become due and payable.
ARTICLE VI
CONCERNING THE TRUSTEE
SECTION 6.01. Duties and Responsibilities of Trustee.
With respect to the holders of the Securities issued hereunder, the
Trustee, prior to the occurrence of an Event of Default and after the curing or
waiving of all Events of Default which may have occurred, undertakes to perform
such duties and only such duties as are specifically set forth in this
Indenture. In case an Event of Default has occurred (which has not been cured
or waived) the Trustee shall exercise such of the rights and powers vested in
it by this Indenture, and use the same degree of care and skill in their
exercise, as a prudent man would exercise or use under the circumstances in the
conduct of his own affairs.
No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct, except that
(a) prior to the occurrence of an Event of Default and after the
curing or waiving of all Events of Default which may have
occurred
(1) the duties and obligations of the Trustee shall be
determined solely by the express provisions of this
Indenture, and the Trustee shall not be liable
except for the performance of such duties and
obligations as are specifically set forth in this
Indenture, and no implied covenants or obligations
shall be read into this Indenture against the
Trustee; and
(2) in the absence of bad faith on the part of the
Trustee, the Trustee may conclusively rely, as to
the truth of the statements and the correctness of
the opinions expressed
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therein, upon any certificates or opinions furnished
to the Trustee and conforming to the requirements of
this Indenture; but, in the case of any such
certificates or opinions which by any provision
hereof are specifically required to be furnished to
the Trustee, the Trustee shall be under a duty to
examine the same to determine whether or not they
conform to the requirements of this Indenture;
(b) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer or Officers of
the Trustee, unless it shall be proved that the Trustee was
negligent in ascertaining the pertinent facts; and
(c) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith, in
accordance with the direction of the Securityholders pursuant
to Section 5.07, relating to the time, method and place of
conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred upon the
Trustee, under this Indenture.
None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers, if there is reasonable ground for believing that the
repayment of such funds or liability is not reasonably assured to it under the
terms of this Indenture or adequate indemnity against such risk is not
reasonably assured to it.
SECTION 6.02. Reliance on Documents, Opinions, etc.
Except as otherwise provided in Section 6.01:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request,
consent, order, bond, note, debenture or other paper or
document be-
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lieved by it to be genuine and to have been signed or
presented by the proper party or parties;
(b) any request, direction, order or demand of the Company
mentioned herein may be sufficiently evidenced by an
Officers' Certificate (unless other evidence in respect
thereof be herein specifically prescribed); and any Board
Resolution may be evidenced to the Trustee by a copy thereof
certified by the Secretary or an Assistant Secretary of the
Company;
(c) the Trustee may consult with counsel of its selection and
any advice or Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken
or suffered omitted by it hereunder in good faith and in
accordance with such advice or Opinion of Counsel;
(d) the Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Indenture at the
request, order or direction of any of the Securityholders,
pursuant to the provisions of this Indenture, unless such
Securityholders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and
liabilities which may be incurred therein or thereby;
(e) the Trustee shall not be liable for any action taken or
omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers
conferred upon it by this Indenture; nothing contained
herein shall, however, relieve the Trustee of the obligation,
upon the occurrence of an Event of Default (that has not been
cured or waived), to exercise such of the rights and powers
vested in it by this Indenture, and to use the same degree of
care and skill in their exercise, as a prudent man would
exercise or use under the circumstances in the conduct of his
own affairs;
(f) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any
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resolution, certificate, statement, instrument, opinion,
report, notice, request, consent, order, approval, bond,
debenture, coupon or other paper or document, unless
requested in writing to do so by the holders of a majority in
aggregate principal amount of the outstanding Securities;
provided, however, that if the payment within a reason able
time to the Trustee of the costs, expenses or liabilities
likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not
reasonably assured to the Trustee by the security afforded to
it by the terms of this Indenture, the Trustee may require
reasonable indemnity against such expense or liability as a
condition to so proceeding; and
(g) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or
by or through agents (including any Authenticating Agent) or
attorneys, and the Trustee shall not be responsible for any
misconduct or negligence on the part of any such agent or
attorney appointed by it with due care.
SECTION 6.03. No Responsibility for Recitals, etc.
The recitals contained herein and in the Securities (except in the
certificate of authentication of the Trustee or the Authenticating Agent) shall
be taken as the statements of the Company and the Trustee and the
Authenticating Agent assume no responsibility for the correctness of the same.
The Trustee and the Authenticating Agent make no representations as to the
validity or sufficiency of this Indenture or of the Securities. The Trustee and
the Authenticating Agent shall not be accountable for the use or application by
the Company of any Securities or the proceeds of any Securities authenticated
and delivered by the Trustee or the Authenticating Agent in conformity with the
provisions of this Indenture.
SECTION 6.04. Trustee, Authenticating Agent, Paying Agents, Transfer
Agents or Registrar May Own Securities.
The Trustee or any Authenticating Agent or any paying agent or any
transfer agent or any Security registrar, in its
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individual or any other capacity, may become the owner or pledgee of Securities
with the same rights it would have if it were not Trustee, Authenticating
Agent, paying agent, transfer agent or Security registrar.
SECTION 6.05. Moneys to be Held in Trust.
Subject to the provisions of Section 11.04, all moneys received by the
Trustee or any paying agent shall, until used or applied as herein provided, be
held in trust for the purpose for which they were received, but need not be
segregated from other funds except to the extent required by law. The Trustee
and any paying agent shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed in writing with the
Company. So long as no Event of Default shall have occurred and be continuing,
all interest allowed on any such moneys shall be paid from time to time upon
the written order of the Company, signed by the Chairman of the Board of
Directors, the President or a Vice President or the Treasurer or an Assistant
Treasurer of the Company.
SECTION 6.06. Compensation and Expenses of Trustee.
The Company, as borrower, covenants and agrees to pay to the Trustee
from time to time, and the Trustee shall be entitled to, such compensation as
shall be agreed to in writing between the Company and the Trustee (which shall
not be limited by any provision of law in regard to the compensation of a
trustee of an express trust), and the Company will pay or reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any of the
provisions of this Indenture (including the reasonable compensation and the
expenses and disbursements of its counsel and of all persons not regularly in
its employ) except any such expense, disbursement or advance as may arise from
its negligence or bad faith. The Company also covenants to indemnify each of
the Trustee or any predecessor Trustee (and its officers, agents, directors and
employees) for, and to hold it harmless against, any and all loss, damage,
claim, liability or expense including taxes (other than taxes based on the
income of the Trustee) incurred without negligence or bad faith on the part of
the Trustee and arising out of or in connection with the acceptance or
administration of this trust, including the costs and expenses of defending
itself against any claim of liability in the premises. The obligations of the
Company
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under this Section 6.06 to compensate and indemnify the Trustee and to pay or
reimburse the Trustee for expenses, disbursements and advances shall constitute
additional indebtedness hereunder. Such additional indebtedness shall be secured
by a lien prior to that of the Securities upon all property and funds held or
collected by the Trustee as such, except funds held in trust for the benefit of
the holders of particular Securities.
Without prejudice to any other rights available to the Trustee
under applicable law, when the Trustee incurs expenses or renders services in
connection with an Event of Default specified in Section 5.01(d) or Section
5.01(e), the expenses (including the reasonable charges and expenses of its
counsel) and the compensation for the services are intended to constitute
expenses of administration under any applicable federal or state bankruptcy,
insolvency or other similar law.
The provisions of this Section shall survive the termination
of this Indenture.
SECTION 6.07. Officers' Certificate as Evidence.
Except as otherwise provided in Sections 6.01 and 6.02,
whenever in the administration of the provisions of this Indenture the Trustee
shall deem it necessary or desirable that a matter be proved or established
prior to taking or omitting any action hereunder, such matter (unless other
evidence in respect thereof is herein specifically prescribed) may, in the
absence of negligence or bad faith on the part of the Trustee, be deemed to be
conclusively proved and established by an Officers' Certificate delivered to
the Trustee, and such certificate, in the absence of negligence or bad faith on
the part of the Trustee, shall be full warrant to the Trustee for any action
taken or omitted by it under the provisions of this Indenture upon the faith
thereof.
SECTION 6.08. Conflicting Interest of Trustee.
If the Trustee has or shall acquire any "conflicting interest"
within the meaning of Section 310(b) of the Trust Indenture Act, the Trustee and
the Company shall in all respects comply with the provisions of Section 310(b)
of the Trust Indenture Act.
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SECTION 6.09. Eligibility of Trustee.
The Trustee hereunder shall at all times be a corporation
organized and doing business under the laws of the United States of America or
any state or territory thereof or of the District of Columbia or a corporation
or other Person permitted to act as trustee by the Commission authorized under
such laws to exercise corporate trust powers, having a combined capital and
surplus of at least 50 million U.S. dollars ($50,000,000) and subject to
supervision or examination by federal, state, territorial, or District of
Columbia authority. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of the aforesaid supervising or
examining authority, then for the purposes of this Section 6.09 the combined
capital and surplus of such corporation shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published.
The Company may not, nor may any Person directly or indirectly
controlling, controlled by, or under common control with the Company, serve as
Trustee.
In case at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section 6.09, the Trustee shall resign
immediately in the manner and with the effect specified in Section 6.10.
SECTION 6.10. Resignation or Removal of Trustee.
(a) The Trustee, or any trustee or trustees hereafter
appointed, may at any time resign by giving writ
ten notice of such resignation to the Company and
by mailing notice thereof to the holders of the
Securities at their addresses as they shall appear
on the Security register. Upon receiving such
notice of resignation, the Company shall promptly
appoint a successor trustee or trustees by written
instrument, in duplicate, one copy of which
instrument shall be delivered to the resigning
Trustee and one copy to the successor trustee. If
no successor trustee shall have been so appointed
and have accepted appointment within 60 days after
the mailing of such notice of resignation to the
Securityholders, the resigning Trustee may petition
any court of competent jurisdiction for the
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appointment of a successor trustee, or any
Securityholder who has been a bona fide holder of a
Security for at least six months may, subject to the
provisions of Section 5.09, on behalf of him self and
all others similarly situated, petition any such
court for the appointment of a successor trustee.
Such court may thereupon, after such notice, if any,
as it may deem proper and prescribe, appoint a
successor trustee.
(b) In case at any time any of the following shall
occur:
(1) the Trustee shall fail to comply with the
provisions of Section 6.08 after written
request therefor by the Company or by any
Securityholder who has been a bona fide
holder of a Security or Securities for at
least six months, or
(2) the Trustee shall cease to be eligible in
accordance with the provisions of Section
6.09 and shall fail to resign after written
request therefor by the Company or by any
such Securityholder, or
(3) the Trustee shall become incapable of
acting, or shall be adjudged a bankrupt or
insolvent, or a receiver of the Trustee or
of its property shall be appointed, or any
public officer shall take charge or control
of the Trustee or of its property or affairs
for the purpose of rehabilitation,
conservation or liquidation,
then, in any such case, the Company may remove the
Trustee and appoint a successor trustee by written
instrument, in duplicate, one copy of which
instrument shall be delivered to the Trustee so
removed and one copy to the successor trustee, or,
subject to the provisions of Section 5.09, any
Securityholder who has been a bona fide holder of a
Security for at least six months may, on behalf of
himself and all others similarly situated, petition
any court of competent jurisdiction for
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the removal of the Trustee and the appointment of a
successor trustee. Such court may thereupon, after
such notice, if any, as it may deem proper and
prescribe, remove the Trustee and appoint a successor
trustee.
(c) The holders of a majority in aggregate principal
amount of the Securities at the time outstanding
may at any time remove the Trustee and nominate a
successor trustee, which shall be deemed appointed
as successor trustee unless within 10 days after
such nomination the Company objects thereto or if
no successor trustee shall have been so appointed
and shall have accepted appointment within 30 days
after such removal, in which case the Trustee so
removed or any Securityholder, upon the terms and
conditions and otherwise as in subsection (a) of
this Section 6.10 provided, may petition any court
of competent jurisdiction for an appointment of a
successor trustee.
(d) Any resignation or removal of the Trustee and
appointment of a successor trustee pursuant to any
of the provisions of this Section 6.10 shall be
come effective upon acceptance of appointment by
the successor trustee as provided in Section 6.11.
If no successor trustee shall have been so
appointed and have accepted appointment within 60
days after the date the Trustee receives notice of
its removal, the removed Trustee may petition any
court of competent jurisdiction for the
appointment of a successor trustee, or any
Securityholder who has been a bona fide holder of
a Security for at least six months may, subject to
the provisions of Section 5.09, on behalf of
himself and all others similarly situated,
petition any such court for the appointment of a
successor trustee. Such court may thereupon,
after such notice, if any, as it may deem proper
and prescribe, appoint a successor trustee.
SECTION 6.11. Acceptance by Successor Trustee.
Any successor trustee appointed as provided in Section 6.10
shall execute, acknowledge and deliver to the Company and to
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its predecessor trustee an instrument accepting such appointment hereunder, and
thereupon the resignation or removal of the retiring trustee shall become
effective and such successor trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, duties and
obligations of its predecessor hereunder, with like effect as if originally
named as trustee herein; but, nevertheless, on the written request of the
Company or of the successor trustee, the trustee ceasing to act shall, upon
payment of any amounts then due it pursuant to the provisions of Section 6.06,
execute and deliver an instrument transferring to such successor trustee all the
rights and powers of the trustee so ceasing to act and shall duly assign,
transfer and deliver to such successor trustee all property and money held by
such retiring trustee thereunder. Upon request of any such successor trustee,
the Company shall execute any and all instruments in writing for more fully and
certainly vesting in and confirming to such successor trustee all such rights
and powers. Any trustee ceasing to act shall, nevertheless, retain a lien upon
all property or funds held or collected by such trustee to secure any amounts
then due it pursuant to the provisions of Section 6.06.
No successor trustee shall accept appointment as provided in
this Section 6.11 unless at the time of such acceptance such successor trustee
shall be qualified under the provisions of Section 6.08 and eligible under the
provisions of Section 6.09.
Upon acceptance of appointment by a successor trustee as
provided in this Section 6.11, the Company shall mail notice of the succession
of such trustee hereunder to the holders of Securities at their addresses as
they shall appear on the Security register. If the Company fails to mail such
notice within 10 days after the acceptance of appointment by the successor
trustee, the successor trustee shall cause such notice to be mailed at the
expense of the Company.
SECTION 6.12. Succession by Merger, etc.
Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to all or substantially all of the
corporate trust business of the Trustee, shall be the successor of the Trustee
hereunder
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without the execution or filing of any paper or any further act
on the part of any of the parties hereto.
In case at the time such successor to the Trustee shall
succeed to the trusts created by this Indenture any Securities shall have been
authenticated but not delivered, any such successor to the Trustee may adopt
the certificate of authentication of any predecessor trustee, and deliver such
Securities so authenticated; and in case at that time any of the Securities
shall not have been authenticated, any successor to the Trustee may authen-
ticate such Securities either in the name of any predecessor hereunder or in the
name of the successor trustee; and in all such cases such certificates shall
have the full force which the Securities or this Indenture elsewhere provides
that the certificate of the Trustee shall have; provided, however, that the
right to adopt the certificate of authentication of any predecessor Trustee or
authenticate Securities in the name of any predecessor Trustee shall apply only
to its successor or successors by merger, conversion or consolidation.
SECTION 6.13. Limitation on Rights of Trustee as a
Creditor.
The Trustee shall comply with Section 311(a) of the Trust
Indenture Act, excluding any creditor relationship described in Section 311(b)
of the Trust Indenture Act. A Trustee who has resigned or been removed shall be
subject to Section 311(a) of the Trust Indenture Act to the extent included
therein.
SECTION 6.14. Authenticating Agents.
There may be one or more Authenticating Agents appointed by
the Trustee upon the request of the Company with power to act on its behalf and
subject to its direction in the authentication and delivery of Securities
issued upon exchange or transfer thereof as fully to all intents and purposes as
though any such Authenticating Agent had been expressly authorized to authenti-
cate and deliver Securities; provided, that the Trustee shall have no liability
to the Company for any acts or omissions of the Authenticating Agent with
respect to the authentication and delivery of Securities. Any such
Authenticating Agent shall at all times be a corporation organized and doing
business under the laws of the United States or of any state or territory
thereof or of the District of Columbia authorized under such laws to act as
Authenticating Agent, having a combined capital and surplus of at
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least $5,000,000 and being subject to supervision or examination by federal,
state, territorial or District of Columbia authority. If such corporation
publishes reports of condition at least annually pursuant to law or the
requirements of such authority, then for the purposes of this Section 6.14 the
combined capital and surplus of such corporation shall be deemed to be its com-
bined capital and surplus as set forth in its most recent report of condition so
published. If at any time an Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section, it shall resign immediately in
the manner and with the effect herein specified in this Section.
Any corporation into which any Authenticating Agent may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, consolidation or conversion to which any
Authenticating Agent shall be a party, or any corporation succeeding to all or
substantially all of the corporate trust business of any Authenticating Agent,
shall be the successor of such Authenticating Agent hereunder, if such successor
corporation is otherwise eligible under this Section 6.14 without the execution
or filing of any paper or any further act on the part of the parties hereto or
such Authenticating Agent.
Any Authenticating Agent may at any time resign by giving
written notice of resignation to the Trustee and to the Company. The Trustee may
at any time terminate the agency of any Authenticating Agent by giving written
notice of termination to such Authenticating Agent and to the Company. Upon
receiving such a notice of resignation or upon such a termination, or in case at
any time any Authenticating Agent shall cease to be eligible under this Section
6.14, the Trustee may, and upon the request of the Company shall, promptly
appoint a successor Authenticating Agent eligible under this Section 6.14, shall
give written notice of such appointment to the Company and shall mail notice of
such appointment to all Securityholders as the names and addresses of such
holders appear on the Security Register. Any successor Authenticating Agent upon
acceptance of its appointment hereunder shall become vested with all rights,
powers, duties and responsibilities of its predecessor hereunder, with like
effect as if originally named as Authenticating Agent herein.
The Company, as borrower, agrees to pay to any Authenticating
Agent from time to time reasonable compensation for its
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services. Any Authenticating Agent shall have no responsibility or liability for
any action taken by it as such in accordance with the directions of the Trustee.
ARTICLE VII
CONCERNING THE SECURITYHOLDERS
SECTION 7.01. Action by Securityholders.
Whenever in this Indenture it is provided that the holders of
a specified percentage in aggregate principal amount of the Securities may take
any action (including the making of any demand or request, the giving of any
notice, consent or waiver or the taking of any other action) the fact that at
the time of taking any such action the holders of such specified percentage have
joined therein may be evidenced (a) by any instrument or any number of
instruments of similar tenor executed by such Securityholders in person or by
agent or proxy appointed in writing, or (b) by the record of such holders of
Securities voting in favor thereof at any meeting of such Securityholders duly
called and held in accordance with the provisions of Article VIII, or (c) by a
combination of such instrument or instruments and any such record of such a
meeting of such Securityholders.
If the Company shall solicit from the Securityholders any
request, demand, authorization, direction, notice, consent, waiver or other
action, the Company may, at its option, as evidenced by an Officers'
Certificate, fix in advance a record date for the determination of
Securityholders entitled to give such request, demand, authorization, direction,
notice, consent, waiver or other action or to revoke any such action, but the
Company shall have no obligation to do so. If such a record date is fixed, such
request, demand, authorization, direction, notice, consent, waiver or other
action or revocation may be given before or after the record date, but only the
Securityholders of record at the close of business on the record date shall be
deemed to be Securityholders for the purposes of determining whether
Securityholders of the requisite proportion of Outstanding Securities have
authorized or agreed or consented to such re quest, demand, authorization,
direction, notice, consent, waiver or other action, and for that purpose the
Outstanding Securities shall be computed as of the record date; provided,
however, that no such authorization, agreement or consent by such
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Securityholders on the record date shall be deemed effective unless it shall
become effective pursuant to the provisions of this Indenture not later than six
months after the record date.
SECTION 7.02. Proof of Execution by Securityholders.
Subject to the provisions of Section 6.01, 6.02 and 8.05,
proof of the execution of any instrument by a Securityholder or his agent or
proxy shall be sufficient if made in accordance with such reasonable rules and
regulations as may be prescribed by the Trustee or in such manner as shall be
satisfactory to the Trustee. The ownership of Securities shall be proved by the
Security Register or by a certificate of the Security registrar. The Trustee may
require such additional proof of any matter referred to in this Section as it
shall deem necessary.
The record of any Securityholders' meeting shall be proved in
the manner provided in Section 8.06.
SECTION 7.03. Who Are Deemed Absolute Owners.
Prior to due presentment for registration of transfer of any
Security, the Company, the Trustee, any Authenticating Agent, any paying agent,
any transfer agent and any Security registrar may deem the person in whose name
such Security shall be registered upon the Security Register to be, and may
treat him as, the absolute owner of such Security (whether or not such Security
shall be overdue) for the purpose of receiving payment of or on account of the
principal of and premium, if any, and (subject to Section 2.06) interest on such
Security and for all other purposes; and neither the Company nor the Trustee nor
any Authenticating Agent nor any paying agent nor any transfer agent nor any
Security registrar shall be affected by any notice to the contrary. All such
payments so made to any holder for the time being or upon his order shall be
valid, and, to the extent of the sum or sums so paid, effectual to satisfy and
discharge the liability for moneys payable upon any such Security.
SECTION 7.04. Securities Owned by Company Deemed Not
Outstanding.
In determining whether the holders of the requisite aggregate
principal amount of Securities have concurred in any direction, consent or
waiver under this Indenture, Securities
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which are owned by the Company or any other obligor on the Securities or by any
person directly or indirectly controlling or controlled by or under direct or
indirect common control with the Company or any other obligor on the Securities
shall be disregarded and deemed not to be outstanding for the purpose of any
such determination; provided that for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, consent or waiver,
only Securities which the Trustee actually knows are so owned shall be so
disregarded. Securities so owned which have been pledged in good faith may be
regarded as outstanding for the purposes of this Section 7.04 if the pledgee
shall establish to the satisfaction of the Trustee the pledgee's right to vote
such Securities and that the pledgee is not the Company or any such other
obligor or person directly or indirectly controlling or controlled by or under
direct or indirect common control with the Company or any such other obligor. In
the case of a dispute as to such right, any decision by the Trustee taken upon
the advice of counsel shall be full protection to the Trustee.
SECTION 7.05. Revocation of Consents; Future Holders
Bound.
At any time prior to (but not after) the evidencing to the
Trustee, as provided in Section 7.01, of the taking of any action by the holders
of the percentage in aggregate principal amount of the Securities specified in
this Indenture in connection with such action, any holder of a Security (or any
Security issued in whole or in part in exchange or substitution therefor),
subject to Section 7.01, the serial number of which is shown by the evidence to
be included in the Securities the holders of which have consented to such action
may, by filing written notice with the Trustee at its principal office and upon
proof of holding as provided in Section 7.02, revoke such action so far as
concerns such Security (or so far as concerns the principal amount represented
by any exchanged or substituted Security). Except as aforesaid any such action
taken by the holder of any Security shall be conclusive and binding upon such
holder and upon all future holders and owners of such Security, and of any
Security issued in exchange or substitution therefor, irrespective of whether
or not any notation in regard thereto is made upon such Security or any Security
issued in exchange or substitution therefor.
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ARTICLE VIII
SECURITYHOLDERS' MEETINGS
SECTION 8.01. Purposes of Meetings.
A meeting of Securityholders may be called at any time and
from time to time pursuant to the provisions of this Article VIII for any of the
following purposes:
(a) to give any notice to the Company or to the Trustee,
or to give any directions to the Trustee, or to
consent to the waiving of any default hereunder and
its consequences, or to take any other action
authorized to be taken by Securityholders pursuant to
any of the provisions of Article V;
(b) to remove the Trustee and nominate a successor
trustee pursuant to the provisions of Article VI;
(c) to consent to the execution of an indenture or
indentures supplemental hereto pursuant to the
provisions of Section 9.02; or
(d) to take any other action authorized to be taken by or
on behalf of the holders of any specified aggregate
principal amount of such Securities under any other
provision of this Indenture or under applicable law.
SECTION 8.02. Call of Meetings by Trustee.
The Trustee may at any time call a meeting of Securityholders
to take any action specified in Section 8.01, to be held at such time and at
such place in the Borough of Manhattan, The City of New York, or at such other
place as the Trustee shall determine. Notice of every meeting of the
Securityholders, setting forth the time and the place of such meeting and in
general terms the action proposed to be taken at such meeting, shall be mailed
to holders of Securities at their addresses as they shall appear on the
Securities Register. Such notice shall be mailed not less than 20 nor more than
180 days prior to the date fixed for the meeting.
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SECTION 8.03. Call of Meetings by Company or
Securityholders.
In case at any time the Company pursuant to a resolution of
the Board of Directors, or the holders of at least 25% in aggregate principal
amount of the Securities then outstanding, shall have requested the Trustee to
call a meeting of Securityholders, by written request setting forth in
reasonable detail the action proposed to be taken at the meeting, and the
Trustee shall not have mailed the notice of such meeting within 20 days after
receipt of such request, then the Company or such Securityholders may determine
the time and the place in the Borough of Manhattan, or such other place as the
Company shall determine for such meeting and may call such meeting to take any
action authorized in Section 8.01, by mailing notice thereof as provided in
Section 8.02.
SECTION 8.04. Qualifications for Voting.
To be entitled to vote at any meeting of Securityholders a
person shall (a) be a holder of one or more Securities or (b) a person appointed
by an instrument in writing as proxy by a holder of one or more Securities. The
only persons who shall be entitled to be present or to speak at any meeting of
Securityholders shall be the persons entitled to vote at such meeting and their
counsel and any representatives of the Trustee and its counsel and any
representatives of the Company and its counsel.
SECTION 8.05. Regulations.
Notwithstanding any other provisions of this Indenture, the
Trustee may make such reasonable regulations as it may deem advisable for any
meeting of Securityholders, in regard to proof of the holding of Securities and
of the appointment of proxies, and in regard to the appointment and duties of
inspectors of votes, the submission and examination of proxies, certificates and
other evidence of the right to vote, and such other matters concerning the
conduct of the meeting as it shall deem appropriate.
The Trustee shall, by an instrument in writing, appoint a
temporary chairman of the meeting, unless the meeting shall have been called by
the Company or by Securityholders as provided in Section 8.03, in which case the
Company or the Securityholders
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calling the meeting, as the case may be, shall in like manner appoint a
temporary chairman. A permanent chairman and a permanent secretary of the
meeting shall be elected by majority vote of the meeting.
Subject to the provisions of Section 8.04, at any meeting each
holder of Securities or proxy therefor shall be entitled to one vote for each
$1,000 principal amount of Securities held or represented by him; provided,
however, that no vote shall be cast or counted at any meeting in respect of any
Security challenged as not outstanding and ruled by the chairman of the meeting
to be not outstanding. The chairman of the meeting shall have no right to vote
other than by virtue of Securities held by him or instruments in writing as
aforesaid duly designating him as the person to vote on behalf of other
Securityholders. Any meeting of Securityholders duly called pursuant to the
provisions of Section 8.02 or 8.03 may be adjourned from time to time by a
majority of those present, whether or not constituting a quorum, and the meeting
may be held as so adjourned without further notice.
SECTION 8.06. Voting.
The vote upon any resolution submitted to any meeting of
holders of Securities shall be by written ballots on which shall be subscribed
the signatures of such holders or of their representatives by proxy and the
serial number or numbers of the Securities held or represented by them. The
permanent chairman of the meeting shall appoint two inspectors of votes who
shall count all votes cast at the meeting for or against any resolution and who
shall make and file with the secretary of the meeting their verified written
reports in triplicate of all votes cast at the meeting. A record in duplicate of
the proceedings of each meeting of Securityholders shall be prepared by the
secretary of the meeting and there shall be attached to said record the original
reports of the inspectors of votes on any vote by ballot taken thereat and
affidavits by one or more persons having knowledge of the facts setting forth a
copy of the notice of the meeting and showing that said notice was mailed as
provided in Section 8.02. The record shall show the serial numbers of the
Securities voting in favor of or against any resolution. The record shall be
signed and verified by the affidavits of the permanent chairman and secretary of
the meeting and one of the duplicates shall be delivered to the Company and the
other to the Trustee to be preserved by the Trustee, the latter to have
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attached thereto the ballots voted at the meeting. The holders of the Series A
Capital Securities and the Series B Capital Securities shall vote for all
purposes as a single class.
Any record so signed and verified shall be conclusive
evidence of the matters therein stated.
ARTICLE IX
AMENDMENTS
SECTION 9.01. Without Consent of Securityholders.
The Company and the Trustee may from time to time and at any
time amend the Indenture, without the consent of the Securityholders, for one or
more of the following purposes:
(a) to evidence the succession of another corporation to
the Company, or successive successions, and the
assumption by the successor corporation of the
covenants, agreements and obligations of the Company
pursuant to Article X hereof;
(b) to add to the covenants of the Company such further
covenants, restrictions or conditions for the
protection of the Securityholders as the Board of
Directors and the Trustee shall consider to be for
the protection of the Securityholders, and to make
the occurrence, or the occurrence and continuance,
of a default in any of such additional covenants,
restrictions or conditions a default or an Event
of Default permitting the enforcement of all or
any of the remedies provided in this Indenture as
herein set forth; provided, however, that in
-------- -------
respect of any such additional covenant, restriction
or condition such amendment may provide for a
particular period of grace after default (which
period may be shorter or longer than that allowed
in the case of other defaults) or may provide for
an immediate enforcement upon such default or may
limit the remedies available to the Trustee upon
such default;
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(c) to provide for the issuance under this Indenture of
Securities in coupon form (including Securities
registrable as to principal only) and to provide for
exchangeability of such Securities with the
Securities issued hereunder in fully registered form
and to make all appropriate changes for such purpose;
(d) to cure any ambiguity or to correct or supplement
any provision contained herein or in any supple
mental indenture which may be defective or incon-
sistent with any other provision contained herein
or in any supplemental indenture, or to make such
other provisions in regard to matters or questions
arising under this Indenture; provided that any
-------- ----
such action shall not materially adversely affect
the interests of the holders of the Securities;
(e) to evidence and provide for the acceptance of
appointment hereunder by a successor trustee with
respect to the Securities;
(f) to make provision for transfer procedures, certif-
ication, book-entry provisions, the form of
restricted securities legends, if any, to be placed
on Securities, minimum denominations and all other
matters required pursuant to Section 2.07 or
otherwise necessary, desirable or appropriate in
connection with the issuance of Securities to holders
of Capital Securities in the event of a distribution
of Securities by AGL Capital Trust following a
Dissolution Event;
(g) to qualify or maintain qualification of this In
denture under the Trust Indenture Act; or
(h) to make any change that does not adversely affect
the rights of any Securityholder in any material
respect.
The Trustee is hereby authorized to join with the Company in
the execution of any supplemental indenture to effect such amendment, to make
any further appropriate agreements and stipulations which may be therein
contained and to accept the conveyance, transfer and assignment of any property
thereunder,
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but the Trustee shall not be obligated to, but may in its discretion, enter
into any such supplemental indenture which affects the Trustee's own rights,
duties or immunities under this Indenture or otherwise.
Any amendment to the Indenture authorized by the provisions
of this Section 9.01 may be executed by the Company and the Trustee without the
consent of the holders of any of the Securities at the time outstanding,
notwithstanding any of the provisions of Section 9.02.
SECTION 9.02. With Consent of Securityholders.
With the consent (evidenced as provided in Section 7.01) of
the holders of a majority in aggregate principal amount of the Securities at the
time outstanding, the Company, when authorized by a Board Resolution, and the
Trustee may from time to time and at any time amend the Indenture for the
purpose of adding any provisions to or changing in any manner or eliminating any
of the provisions of this Indenture or of modifying in any manner the rights of
the holders of the Securities; provided, however, that no such amendment shall
without the consent of the holders of each Security then outstanding and
affected thereby (i) extend the Maturity Date of any Security, or reduce the
rate or extend the time of payment of interest thereon (except as contemplated
by Article XVI), or reduce the principal amount thereof, or reduce any amount
payable on redemption thereof, or make the principal thereof or any interest or
premium thereon payable in any coin or currency other than that provided in the
Securities, or impair or affect the right of any Securityholder to institute
suit for payment thereof, or (ii) reduce the afore said percentage of Securities
the holders of which are required to consent to any such amendment to the
Indenture, provided, however, that if the Securities are held by AGL Capital
Trust, such amendment shall not be effective until the holders of a majority in
liquidation amount of Trust Securities shall have consented to such amendment;
provided, further, that if the consent of the holder of each outstanding
Security is required, such amendment shall not be effective until each holder of
the Trust Securities shall have consented to such amendment.
Upon the request of the Company accompanied by a copy of a
resolution of the Board of Directors certified by its Secretary or Assistant
Secretary authorizing the execution of any supplemental indenture affecting such
amendment, and upon the
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filing with the Trustee of evidence of the consent of Securityholders as
aforesaid, the Trustee shall join with the Company in the execution of such
supplemental indenture unless such supplemental indenture affects the Trustee's
own rights, duties or immunities under this Indenture or otherwise, in which
case the Trustee may in its discretion, but shall not be obligated to, enter
into such supplemental indenture.
Promptly after the execution by the Company and the Trustee of
any supplemental indenture pursuant to the provisions of this Section, the
Trustee shall transmit by mail, first class postage prepaid, a notice, prepared
by the Company, setting forth in general terms the substance of such
supplemental indenture, to the Securityholders as their names and addresses
appear upon the Security Register. Any failure of the Trustee to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such supplemental indenture.
It shall not be necessary for the consent of the
Securityholders under this Section 9.02 to approve the particular form of any
proposed supplemental indenture, but it shall be sufficient if such consent
shall approve the substance thereof.
SECTION 9.03. Compliance with Trust Indenture Act;
Effect of Supplemental Indentures.
Any supplemental indenture executed pursuant to the provisions
of this Article IX shall comply with the Trust Indenture Act. Upon the
execution of any supplemental indenture pursuant to the provisions of this
Article IX, this Indenture shall be and be deemed to be modified and amended in
accordance therewith and the respective rights, limitations of rights,
obligations, duties and immunities under this Indenture of the Trustee, the
Company and the holders of Securities shall there after be determined, exercised
and enforced hereunder subject in all respects to such modifications and
amendments and all the terms and conditions of any such supplemental indenture
shall be and be deemed to be part of the terms and conditions of this Indenture
for any and all purposes.
SECTION 9.04. Notation on Securities.
Securities authenticated and delivered after the execution of
any supplemental indenture affecting such series pursuant to the provisions of
this Article IX may bear a notation
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in form approved by the Trustee as to any matter provided for in such
supplemental indenture. If the Company or the Trustee shall so determine, new
Securities so modified as to conform, in the opinion of the Trustee and the
Board of Directors, to any modification of this Indenture contained in any such
supplemental indenture may be prepared and executed by the Company, authenti-
cated by the Trustee or the Authenticating Agent and delivered in exchange for
the Securities then outstanding.
SECTION 9.05. Evidence of Compliance of Supplemental
Indenture to be Furnished Trustee.
The Trustee, subject to the provisions of Sections 6.01 and
6.02, may receive an Officers' Certificate and an Opinion of Counsel as
conclusive evidence that any supplemental indenture executed pursuant hereto
complies with the requirements of this Article IX.
The Trustee may receive an Opinion of Counsel as conclusive
evidence that any supplemental indenture executed pursuant to this Article is
authorized or permitted by, and conforms to, the terms of this Article and that
it is proper for the Trustee under the provisions of this Article to join in the
execution thereof.
ARTICLE X
CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
SECTION 10.01. Company May Consolidate, etc., on Certain
Terms.
Nothing contained in this Indenture or in any of the
Securities shall prevent any consolidation or merger of the Company with or into
any other Person (whether or not affiliated with the Company, as the case may
be), or successive consolidations or mergers in which the Company, or its
successor or successors, as the case may be, shall be a party or parties, or
shall prevent any sale, conveyance, transfer or lease of the property of the
Company, or its successor or successors, as the case may be, as an entirety, or
substantially as an entirety, to any other Person (whether or not affiliated
with the Company, or its successor or successors, as the case may be) authorized
to acquire and operate the same; provided, that (a) the Company is
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the surviving Person, or the Person formed by or surviving any such
consolidation or merger (if other than the Company) or to which such sale,
conveyance, transfer or lease of property is made is a Person organized and
existing under the laws of the United States or any State thereof or the
District of Columbia, and (b) upon any such consolidation, merger, sale,
conveyance, transfer or lease, the due and punctual payment of the principal of
(and premium, if any) and interest on the Securities according to their tenor
and the due and punctual performance and observance of all the covenants and
conditions of this Indenture to be kept or performed by the Company shall be
expressly assumed, by supplemental indenture (which shall conform to the
provisions of the Trust Indenture Act, as then in effect) satisfactory in form
to the Trustee executed and delivered to the Trustee by the Person formed by
such consolidation, or into which the Company, shall have been merged, or by the
Person which shall have acquired such property, as the case may be, and (c)
after giving effect to such consolidation, merger, sale, conveyance, transfer or
lease, no Default or Event of Default shall have occurred and be continuing.
SECTION 10.02. Successor Corporation to be Substituted
for Company.
In case of any such consolidation, merger, conveyance or
transfer and upon the assumption by the successor corporation, by supplemental
indenture, executed and delivered to the Trustee and satisfactory in form to the
Trustee, of the due and punctual payment of the principal of and premium, if
any, and interest on all of the Securities and the due and punctual performance
and observance of all of the covenants and conditions of this Indenture to be
performed or observed by the Company, such successor Person shall succeed to and
be substituted for the Company, with the same effect as if it had been named
herein as the party of the first part, and the Company thereupon shall be
relieved of any further liability or obligation hereunder or upon the Securi-
ties. Such successor Person thereupon may cause to be signed, and may issue
either in its own name or in the name of AGL Resources Inc., any or all of the
Securities issuable hereunder which theretofore shall not have been signed by
the Company and delivered to the Trustee or the Authenticating Agent; and, upon
the order of such successor Person instead of the Company and subject to all the
terms, conditions and limitations in this Indenture prescribed, the Trustee or
the Authenticating Agent shall authenticate and deliver any Securities which
previously
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shall have been signed and delivered by the officers of the Company to the
Trustee or the Authenticating Agent for authentication, and any Securities
which such successor Person thereafter shall cause to be signed and delivered to
the Trustee or the Authenticating Agent for that purpose. All the Securities so
issued shall in all respects have the same legal rank and benefit under this
Indenture as the Securities theretofore or thereafter issued in accordance with
the terms of this Indenture as though all of such Indentures had been issued at
the date of the execution hereof.
SECTION 10.03. Opinion of Counsel to be Given Trustee.
The Trustee, subject to the provisions of Sections 6.01 and
6.02, may receive an Opinion of Counsel as conclusive evidence that any
consolidation, merger, sale, conveyance, transfer or lease, and any assumption,
permitted or required by the terms of this Article X complies with the
provisions of this Article X.
ARTICLE XI
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 11.01. Discharge of Indenture.
When (a) the Company shall deliver to the Trustee for
cancellation all Securities theretofore authenticated (other than any Securities
which shall have been destroyed, lost or stolen and which shall have been
replaced or paid as provided in Section 2.08) and not theretofore cancelled, or
(b) all the Securities not theretofore cancelled or delivered to the Trustee for
cancellation shall have become due and payable, or are by their terms to become
due and payable within one year or are to be called for redemption within one
year under arrangements satisfactory to the Trustee for the giving of notice of
redemption, and the Company shall deposit with the Trustee, in trust, funds
sufficient to pay on the Maturity Date or upon redemption all of the Securities
(other than any Securities which shall have been destroyed, lost or stolen and
which shall have been replaced as provided in Section 2.08) not theretofore
cancelled or delivered to the Trustee for cancellation, including principal and
premium, if any, and interest due or to become due to the Maturity Date or
redemption date, as the case may be, but excluding, however, the amount of any
moneys for the payment of principal of or premium,
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if any, or interest on the Securities (1) theretofore repaid to the Company in
accordance with the provisions of Section 11.04, or (2) paid to any State or to
the District of Columbia pursuant to its unclaimed property or similar laws, and
if in either case the Company shall also pay or cause to be paid all other sums
payable hereunder by the Company, then this Indenture shall cease to be of
further effect except for the provisions of Sections 2.02, 2.07, 2.08, 3.01,
3.02, 3.04, 6.06, 6.10 and 11.04 hereof, which shall survive until such
Securities shall mature and be paid. Thereafter, Sections 6.06, 6.10 and 11.04
shall survive, and the Trustee, on demand of the Company accompanied by any
Officers' Certificate and an Opinion of Counsel and at the cost and expense of
the Company, shall execute proper instruments acknowledging satisfaction of and
discharging this Indenture, the Company, however, hereby agreeing to reimburse
the Trustee for any costs or expenses thereafter reasonably and properly
incurred by the Trustee in connection with this Indenture or the Securities.
SECTION 11.02. Deposited Moneys and U.S. Government
Obligations to be Held in Trust by Trustee.
Subject to the provisions of Section 11.04, all moneys and
U.S. Government Obligations deposited with the Trustee pursuant to Sections
11.01 or 11.05 shall be held in trust and applied by it to the payment, either
directly or through any paying agent (including the Company if acting as its own
paying agent), to the holders of the particular Securities for the payment of
which such moneys or U.S. Government Obligations have been deposited with the
Trustee, of all sums due and to become due thereon for principal, premium, if
any, and interest.
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the U.S. Government
Obligations deposited pursuant to Section 11.05 or the principal and interest
received in respect thereof other than any such tax, fee or other charge which
by law is for the account of the holders of outstanding Securities.
SECTION 11.03. Paying Agent to Repay Moneys Held.
Upon the satisfaction and discharge of this Indenture all
moneys then held by any paying agent of the Securities (other than the Trustee)
shall, upon written demand of the Company, be
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repaid to it or paid to the Trustee, and thereupon such paying agent shall be
released from all further liability with respect to such moneys.
SECTION 11.04. Return of Unclaimed Moneys.
Any moneys deposited with or paid to the Trustee or any paying
agent for payment of the principal of or premium, if any, or interest on
Securities and not applied but remaining unclaimed by the holders of Securities
for two years after the date upon which the principal of or premium, if any, or
interest on such Securities, as the case may be, shall have become due and pay
able, shall be repaid to the Company by the Trustee or such paying agent on
Company Request; and the holder of any of the Securities shall thereafter look
only to the Company for any payment which such holder may be entitled to collect
and all liability of the Trustee or such paying agent with respect to such
moneys shall thereupon cease.
SECTION 11.05. Defeasance Upon Deposit of Moneys or
U.S. Government Obligations.
The Company shall be deemed to have been Discharged (as
defined below) from its obligations with respect to the Securities on the 91st
day after the conditions set forth below have been satisfied:
(1) The Company shall have deposited or caused to be
deposited irrevocably with the Trustee or the
Defeasance Agent (as defined below) as trust funds in
trust, specifically pledged as security for, and
dedicated solely to, the benefit of the holders of
the Securities (i) money in an amount, or (ii) U.S.
Government Obligations which through the payment of
interest and principal in respect thereof in
accordance with their terms will provide, not later
than one day before the due date of any payment,
money in an amount, or (iii) a combination of (i) and
(ii), sufficient, in the opinion (with respect to
(ii) and (iii)) of a nationally recognized firm of
independent public accountants expressed in a written
certification thereof delivered to the Trustee and
the Defeasance Agent, if any, to pay and discharge
each installment of principal of and interest and
pre-
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mium, if any, on the outstanding Securities on the
dates such installments of principal, interest or
premium are due;
(2) if the Securities are then listed on any national
securities exchange, the Company shall have deliv-
ered to the Trustee and the Defeasance Agent, if any,
an Opinion of Counsel to the effect that the exercise
of the option under this Section 11.05 would not
cause such Securities to be delisted from such
exchange;
(3) no Default or Event of Default with respect to the
Securities shall have occurred and be continuing
on the date of such deposit; and
(4) the Company shall have delivered to the Trustee and
the Defeasance Agent, if any, an Opinion of Counsel
to the effect that holders of the Securities will
not recognize income, gain or loss for United States
federal income tax purposes as a result of the
exercise of the option under this Section 11.05 and
will be subject to United States federal income tax
on the same amount and in the same manner and at the
same times as would have been the case if such option
had not been exercised, and such opinion shall be
based on a statute so providing or be accompanied by
a private letter ruling to that effect received from
the United States Internal Revenue Service or a
revenue ruling pertaining to a comparable form of
transaction to that effect published by the United
States Internal Revenue Service.
"Discharged" means that the Company shall be deemed to have
paid and discharged the entire indebtedness represented by, and obligations
under, the Securities and to have satisfied all the obligations under this
Indenture relating to the Securities (and the Trustee, at the expense of the
Company, shall execute proper instruments acknowledging the same), except (A)
the rights of holders of Securities to receive, from the trust fund described
in clause (1) above, payment of the principal of and the interest and premium,
if any, on the Securities when such payments are due; (B) the Company's
obligations with respect to the Securities under Sections 2.02, 2.07, 2.08,
3.02, 3.04, 6.10 and
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11.04; and (C) the rights, powers, trusts, duties and immunities of the Trustee
hereunder.
"Defeasance Agent" means another financial institution which
is eligible to act as Trustee hereunder and which assumes all of the obligations
of the Trustee necessary to enable the Trustee to act under this Article. In the
event such a Defeasance Agent is appointed pursuant to this Section, the
following conditions shall apply:
(1) The Trustee shall have approval rights over the
document appointing such Defeasance Agent and the
document setting forth such Defeasance Agent's rights
and responsibilities;
(2) The Defeasance Agent shall provide verification to
the Trustee acknowledging receipt of sufficient
money and/or U. S. Government Obligations to meet
the applicable conditions set forth in this Section
11.05.
ARTICLE XII
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS
SECTION 12.01. Indenture and Securities Solely Corporate
Obligations.
No recourse for the payment of the principal of or premium, if
any, or interest on any Security, or for any claim based thereon or otherwise in
respect thereof, and no recourse under or upon any obligation, covenant or
agreement of the Company in this Indenture, or in any Security, or because of
the creation of any indebtedness represented thereby, shall be had against any
incorporator, stockholder, officer or director, as such, past, present or
future, of the Company or of any successor Person to the Company, either
directly or through the Company or any successor Person to the Company, whether
by virtue of any constitution, statute or rule of law, or by the enforcement of
any assessment or penalty or otherwise; it being expressly understood that all
such liability is hereby expressly waived and released as a condition of, and as
a consideration for, the execution of this Indenture and the issue of the
Securities.
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ARTICLE XIII
MISCELLANEOUS PROVISIONS
SECTION 13.01. Successors.
All the covenants, stipulations, promises and agreements in
this Indenture contained by the Company shall bind its successors and assigns
whether so expressed or not.
SECTION 13.02. Official Acts by Successor Corporation.
Any act or proceeding by any provision of this Indenture
authorized or required to be done or performed by any board, committee or
officer of the Company shall and may be done and performed with like force and
effect by the like board, committee or officer of any corporation that shall at
the time be the lawful sole successor of the Company.
SECTION 13.03. Surrender of Company Powers.
The Company by instrument in writing executed by authority of
2/3 (two-thirds) of its Board of Directors and delivered to the Trustee may
surrender any of the powers reserved to the Company, and thereupon such power so
surrendered shall terminate both as to the Company, as the case may be, and as
to any successor Person.
SECTION 13.04. Addresses for Notices, etc.
Any notice or demand which by any provision of this Indenture
is required or permitted to be given or served by the Trustee or by the holders
of Securities on the Company may be given or served by being deposited postage
prepaid by registered or certified mail in a post office letter box addressed
(until another address is filed by the Company with the Trustee for the purpose)
to the Company, 303 Peachtree Street, Atlanta, Georgia 30308, Attention:
Secretary. Any notice, direction, request or demand by any Securityholder to or
upon the Trustee shall be deemed to have been sufficiently given or made, for
all purposes, if given or made in writing at the office of the Trustee, 101
Barclay Street - 21W, New York, New York 10286, Attention: Corporate Trustee
Administration Department (unless another
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address is provided by the Trustee to the Company for the purpose).
Any notice or communication to a Holder shall be mailed by
first class mail to his or her address shown on the register kept by the
Registrar. Failure to mail a notice or communication to a Holder or any defect
in it shall not affect its sufficiency with respect to other Holders.
SECTION 13.05. Governing Law.
This Indenture and each Security shall be deemed to be a
contract made under the laws of the State of New York, and for all purposes
shall be governed by and construed in accordance with the laws of said State,
without regard to conflicts of laws principles thereof.
SECTION 13.06. Evidence of Compliance with Conditions
Precedent.
Upon any application or demand by the Company to the Trustee
to take any action under any of the provisions of this Indenture, the Company
shall furnish to the Trustee an Officers' Certificate stating that in the
opinion of the signers all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with and an Opinion
of Counsel stating that, in the opinion of such counsel, all such conditions
precedent have been complied with.
Each certificate or opinion provided for in this Indenture and
delivered to the Trustee with respect to compliance with a condition or covenant
provided for in this Indenture (except pursuant to Section 3.05) shall include
(1) a statement that the person making such certificate or opinion has read such
covenant or condition; (2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained in
such certificate or opinion are based; (3) a statement that, in the opinion of
such person, he has made such examination or investigation as is necessary to
enable him to express an informed opinion as to whether or not such covenant or
condition has been complied with; and (4) a statement as to whether or not, in
the opinion of such person, such condition or covenant has been complied with.
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SECTION 13.07. Business Days.
In any case where the date of payment of principal of or
premium, if any, or interest on the Securities will not be a Business Day, the
payment of such principal of or premium, if any, or interest on the Securities
need not be made on such date but may be made on the next succeeding Business
Day, with the same force and effect as if made on the date of payment and no
interest shall accrue for the period from and after such date.
SECTION 13.08. Trust Indenture Act to Control.
If and to the extent that any provision of this Indenture
limits, qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act of 1939, such imposed duties shall
control.
SECTION 13.09. Table of Contents, Headings, etc.
The table of contents and the titles and headings of the
articles and sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.
SECTION 13.10. Execution in Counterparts.
This Indenture may be executed in any number of counterparts,
each of which shall be an original, but such counter parts shall together
constitute but one and the same instrument.
SECTION 13.11. Separability.
In case any one or more of the provisions contained in this
Indenture or in the 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 Indenture or of
the Securities, but this Indenture and the Securities shall be construed as if
such invalid or illegal or unenforceable provision had never been contained
herein or therein.
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SECTION 13.12. Assignment.
The Company will have the right at all times to assign any of
its respective rights or obligations under this Indenture to a direct or
indirect wholly owned Subsidiary of the Company, provided that, in the event of
any such assignment, the Company will remain primarily liable for all its
obligations. Subject to the foregoing, the Indenture is binding upon and inures
to the benefit of the parties thereto and their respective successors and
assigns. This Indenture may not otherwise be assigned by the parties thereto.
SECTION 13.13. Acknowledgment of Rights.
The Company acknowledges that, with respect to any Securities
held by AGL Capital Trust or a trustee of such trust, if the Property Trustee of
such Trust fails to enforce its rights under this Indenture as the holder of the
Securities held as the assets of AGL Capital Trust any holder of Capital
Securities may institute legal proceedings directly against the Company to
enforce such Property Trustee's rights under this Indenture without first
instituting any legal proceedings against such Property Trustee or any other
person or entity. Notwithstanding the foregoing, if an Event of Default has
occurred and is continuing and such event is attributable to the failure of the
Company to pay principal of or premium, if any, or interest on the Securities
when due, the Company acknowledges that a holder of Capital Securities may
directly institute a proceeding for enforcement of payment to such holder of
the principal of or premium, if any, or interest on the Securities having a
principal amount equal to the aggregate liquidation amount of the Capital
Securities of such holder on or after the respective due date specified in the
Securities.
ARTICLE XIV
REDEMPTION OF SECURITIES -- MANDATORY AND
OPTIONAL SINKING FUND
SECTION 14.01. Special Event Redemption.
If a Tax Event or an Investment Company Act Event has occurred
and is continuing then, notwithstanding Section 14.02(a), the Company shall have
the right at any time prior to
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the Initial Optional Redemption Date, upon (i) not less than 45 days written
notice to the Trustee, which notice shall be accompanied by an Officers'
Certificate certifying that a Tax Event or an Investment Company Act Event
entitling the Company to redeem the Securities pursuant to this Section, has
occurred and (ii) not less than 30 days nor more than 60 days written notice to
the Securityholders, to redeem the Securities, in whole (but not in part),
within 90 days following the occurrence of such Tax Event or Investment Company
Act Event at the Special Event Redemption Price. Following a Tax Event or an
Investment Company Act Event, the Company shall take such action as is necessary
to promptly determine the Special Event Redemption Price, including without
limitation the appointment by the Company of a Quotation Agent. The Special
Event Redemption Price shall be paid prior to 12:00 noon, New York time, on the
date of such redemption or such earlier time as the Company determines, provided
that the Company shall deposit with the Trustee an amount sufficient to pay the
Special Event Redemption Price by 10:00 a.m., New York time, on the date such
Special Event Prepayment Price is to be paid. The Company shall provide the
Trustee with written notice of the Special Event Redemption Price promptly after
the calculation thereof, which notice shall include any calculation made by the
Quotation Agent in connection with the determination of the Special Event
Redemption Price.
SECTION 14.02. Optional Redemption by Company.
(a) Subject to the provisions of this Article XIV, the Company
shall have the right to redeem the Securities, in whole or in part, from time to
time, on or after Initial Optional Redemption Date at a redemption price (the
"Optional Redemption Price") equal to the percentage of the outstanding
principal amount of the Debentures specified below, plus, in each case, accrued
interest thereon to the date of redemption if redeemed during the 12-month
period beginning June 1 of the years indicated below.
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Year Percentage
2007 104.085%
2008 103.677%
2009 103.268%
2010 102.860%
2011 102.451%
2012 102.043%
2013 101.634%
2014 101.226%
2015 100.817%
2016 100.409%
2017 and thereafter 100.000%
If the Securities are only partially redeemed pursuant to this
Section 14.02, the Securities will be redeemed pro rata or by lot or by any
other method utilized by the Trustee; provided, that if at the time of
redemption the Securities are registered as a Global Security, the Depositary
shall determine, in accordance with its procedures, the principal amount of such
Securities held for the account of its participants to be redeemed. The
Optional Redemption Price shall be paid prior to 12:00 noon, New York time, on
the date of such redemption or at such earlier time as the Company determines,
provided that the Company shall deposit with the Trustee an amount sufficient to
pay the Optional Redemption Price by 10:00 a.m., New York time, on the date such
Optional Redemption Price is to be paid.
(b) Notwithstanding the first sentence of Section 14.02, upon
the entry of an order for dissolution of the AGL Capital Trust by a court of
competent jurisdiction, the Securities thereafter will be subject to optional
redemption, in whole only, but not in part, on or after June 1, 2007, at the
optional redemption prices set forth in Section 14.02 and otherwise in
accordance with this Article XIV.
SECTION 14.03. No Sinking Fund.
The Securities are not entitled to the benefit of any sinking
fund.
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SECTION 14.04. Notice of Redemption; Selection of
Securities.
In case the Company shall desire to exercise the right to
redeem all, or, as the case may be, any part of the Securities in accordance
with their terms, it shall fix a date for redemption and shall mail a notice of
such redemption at least 30 and not more than 60 days prior to the date fixed
for redemption to the holders of Securities so to be redeemed as a whole or in
part at their last addresses as the same appear on the Security Register. Such
mailing shall be by first class mail. The notice if mailed in the manner herein
provided shall be conclusively presumed to have been duly given, whether or not
the holder receives such notice. In any case, failure to give such notice by
mail or any defect in the notice to the holder of any Security designated for
redemption as a whole or in part shall not affect the validity of the
proceedings for the redemption of any other Security.
Each such notice of redemption shall specify the CUSIP number
of the Securities to be redeemed, the date fixed for redemption, the redemption
price at which the Securities are to be redeemed (or the method by which such
redemption price is to be calculated), the place or places of payment, that
payment will be made upon presentation and surrender of the Securities, that
interest accrued to the date fixed for redemption will be paid as specified in
said notice, and that on and after said date interest thereon or on the
portions thereof to be redeemed will cease to accrue. If less than all the
Securities are to be redeemed the notice of redemption shall specify the numbers
of the Securities to be redeemed. In case any Security is to be redeemed in
part only, the notice of redemption shall state the portion of the principal
amount thereof to be redeemed and shall state that on and after the date fixed
for redemption, upon surrender of such Security, a new Security or Securities in
principal amount equal to the unredeemed portion thereof will be issued.
By 10:00 a.m. New York time on the redemption date specified
in the notice of redemption given as provided in this Section, the Company will
deposit with the Trustee or with one or more paying agents an amount of money
sufficient to redeem on the redemption date all the Securities so called for
redemption at the appropriate Redemption Price, together with accrued interest
to the date fixed for redemption.
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The Company will give the Trustee notice not less than 45 days
prior to the redemption date as to the aggregate principal amount of Securities
to be redeemed and the Trustee shall select, in such manner as in its sole
discretion it shall deem appropriate and fair, the Securities or portions
thereof (in integral multiples of $1,000, except as otherwise set forth in the
applicable form of Security) to be redeemed.
SECTION 14.05. Payment of Securities Called for Redemption.
If notice of redemption has been given as provided in Section
14.04, the Securities or portions of Securities with respect to which such
notice has been given shall become due and payable on the date and at the place
or places stated in such notice at the applicable Redemption Price, together
with interest accrued to the date fixed for redemption (subject to the rights of
holders of Securities on the close of business on a regular record date in
respect of an Interest Payment Date occurring on or prior to the redemption
date), and on and after said date (unless the Company shall default in the
payment of such Securities at the Redemption Price, together with interest
accrued to said date) interest on the Securities or portions of Securities so
called for redemption shall cease to accrue. On presentation and surrender of
such Securities at a place of payment specified in said notice, the said
Securities or the specified portions thereof shall be paid and redeemed by the
Company at the applicable Redemption Price, together with interest accrued
thereon to the date fixed for redemption (subject to the rights of holders of
Securities on the close of business on a regular record date in respect of an
Interest Payment Date occurring on or prior to the redemption date).
Upon presentation of any Security redeemed in part only, the
Company shall execute and the Trustee shall authenticate and make available for
delivery to the holder thereof, at the expense of the Company, a new Security or
Securities of authorized denominations, in principal amount equal to the
unredeemed portion of the Security so presented.
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ARTICLE XV
SUBORDINATION OF SECURITIES
SECTION 15.01. Agreement to Subordinate.
The Company covenants and agrees, and each holder of
Securities issued hereunder likewise covenants and agrees, that the Securities
shall be issued subject to the provisions of this Article XV; and each holder of
a Security, whether upon original issue or upon transfer or assignment thereof,
accepts and agrees to be bound by such provisions.
The payment by the Company of the principal of (including
redemption payments), premium, if any, and interest on all Securities issued
hereunder shall, to the extent and in the manner hereinafter set forth, be
subordinated and junior in right of payment to all Senior Indebtedness, whether
outstanding at the date of this Indenture or thereafter incurred.
No provision of this Article XV shall prevent the occurrence
of any Default or Event of Default hereunder.
SECTION 15.02. Default on Senior Indebtedness.
In the event and during the continuation of any default by the
Company in the payment of principal, premium, interest or any other payment due
on any Senior Indebtedness, in the event that any applicable grace period with
respect to such default has ended and such default has not been cured or waived
or ceased to exist, or in the event that the maturity of any Senior Indebtedness
has been accelerated because of a default, then, in any of these cases, no
payment shall be made by the Company with respect to the principal (including
redemption payments) of or premium, if any, or interest on the Securities.
In the event of the acceleration of the maturity of the
Securities, then no payment shall be made by the Company with respect to the
principal (including redemption payments) of or premium, if any, or interest on
the Securities until the holders of all Senior Indebtedness outstanding at the
time of such acceleration shall receive payment in full.
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In the event that, notwithstanding the foregoing, any payment
shall be received by the Trustee when such payment is prohibited by the
preceding paragraphs of this Section 15.02, such payment shall be held in trust
for the benefit of, and shall be paid over or delivered to, the holders of
Senior Indebtedness or their respective representatives, or to the trustee or
trustees under any indenture pursuant to which any of such Senior Indebtedness
may have been issued, as their respective interests may appear, but only to the
extent that the holders of the Senior Indebtedness (or their representative or
representatives or a trustee) notify the Trustee in writing, within 90 days of
such payment of the amounts then due and owing on such Senior Indebtedness and
only the amounts specified in such notice to the Trustee shall be paid to the
holders of such Senior Indebtedness.
SECTION 15.03. Liquidation; Dissolution; Bankruptcy.
Upon any payment by the Company or distribution of assets of
the Company of any kind or character, whether in cash, property or securities,
to creditors upon any dissolution, winding-up, liquidation, reorganization,
assignment for the benefit of creditors, marshaling of assets or any bankruptcy,
insolvency, debt restructuring or similar proceedings in connection with any
insolvency or bankruptcy proceeding of the Company, all Senior Indebtedness of
the Company must first be paid in full, or payment thereof provided for in money
in accordance with its terms, before any payment is made by the Company on
account of the principal (and premium, if any) or interest on the Securities;
and upon any such dissolution or winding-up or liquidation or reorganization,
any payment by the Company, or distribution of assets of the Company of any kind
or character, whether in cash, property or securities, to which the
Securityholders or the Trustee would be entitled to receive from the Company,
except for the provisions of this Article XV, shall be paid by the Company or by
any receiver, trustee in bankruptcy, liquidating trustee, agent or other Person
making such payment or distribution, or by the Securityholders or by the Trustee
under the Indenture if received by them or it, directly to the holders of Senior
Indebtedness of the Company (pro rata to such holders on the basis of the
respective amounts of Senior In-
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debtedness held by such holders, as calculated by the Company) or their
representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing such Senior Indebtedness
may have been issued, as their respective interests may appear, to the extent
necessary to pay all such Senior In debtedness in full, in money or money's
worth, after giving effect to any concurrent payment or distribution to or for
the holders of such Senior Indebtedness, before any payment or distribution is
made to the Securityholders or to the Trustee.
In the event that, notwithstanding the foregoing, any payment
or distribution of assets of the Company of any kind or character, whether in
cash, property or securities, prohibited by the foregoing, shall be received by
the Trustee before all Senior Indebtedness is paid in full, or provision is made
for such payment in money in accordance with its terms, such payment or
distribution shall be held in trust for the benefit of and shall be paid over or
delivered to the holders of such Senior Indebtedness or their representative or
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing such Senior Indebtedness may have been issued,
as their respective interests may appear, as calculated by the Company, for
application to the payment of all Senior Indebtedness remaining unpaid to the
extent necessary to pay all such Senior Indebtedness in full in money in
accordance with its terms, after giving effect to any concurrent payment or
distribution to or for the benefit of the holders of such Senior Indebtedness.
For purposes of this Article XV, the words "cash, property or
securities" shall not be deemed to include shares of stock of the Company as
reorganized or readjusted, or securities of the Company or any other corporation
provided for by a plan of reorganization or readjustment, the payment of which
is subordinated at least to the extent provided in this Article XV with respect
to the Securities to the payment of Senior Indebtedness that may at the time be
outstanding, provided that (i) such Senior Indebtedness is assumed by the new
corporation, if any, resulting from any such reorganization or readjustment, and
(ii) the rights of the holders of such Senior Indebtedness are not, without the
consent of such holders, altered by such reorganization or readjustment. The
consolidation of the Company with, or the merger of the Company into, another
Person or the liquidation or dissolution of the Company following the sale,
conveyance, transfer or lease of its property as an entirety, or substantially
as an entirety, to another Person upon the terms and conditions provided for in
Article X of this Indenture shall not be deemed a dissolution, winding-up,
liquidation or reorganization for the purposes of this Section 15.03 if such
other Person shall, as a part of such consolidation, merger, sale, conveyance,
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transfer or lease, comply with the conditions stated in Article X of this
Indenture.
SECTION 15.04. Subrogation.
Subject to the payment in full of all Senior Indebtedness,
the rights of the Securityholders shall be subrogated to the rights of the
holders of such Senior Indebtedness to receive payments or distributions of
cash, property or securities of the Company, as the case may be, applicable to
such Senior Indebtedness until the principal of (and premium, if any) and
interest on the Securities shall be paid in full; and, for the purposes of such
subrogation, no payments or distributions to the holders of such Senior
Indebtedness of any cash, property or securities to which the Securityholders or
the Trustee would be entitled except for the provisions of this Article XV, and
no payment over pursuant to the provisions of this Article XV to or for the
benefit of the holders of such Senior Indebtedness by Securityholders or the
Trustee, shall, as between the Company, its creditors other than holders of
Senior Indebtedness of the Company, and the holders of the Securities, be deemed
to be a payment by the Company to or on account of such Senior Indebtedness. It
is understood that the provisions of this Article XV are and are intended solely
for the purposes of defining the relative rights of the holders of the
Securities, on the one hand, and the holders of such Senior Indebtedness on the
other hand.
Nothing contained in this Article XV or elsewhere in this
Indenture or in the Securities is intended to or shall impair, as between the
Company, its creditors other than the holders of Senior Indebtedness of the
Company, and the holders of the Securities, the obligation of the Company, which
is absolute and unconditional, to pay to the holders of the Securities the
principal of (and premium, if any) and interest on the Securities as and when
the same shall become due and payable in accordance with their terms, or is
intended to or shall affect the relative rights of the holders of the Securities
and creditors of the Company, as the case may be, other than the holders of
Senior Indebtedness of the Company, as the case may be, nor shall anything
herein or therein prevent the Trustee or the holder of any Security from
exercising all remedies otherwise permitted by applicable law upon default under
the Indenture, subject to the rights, if any, under this Article XV of the
holders of such Senior Indebtedness in respect of cash, property or securities
of
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the Company, as the case may be, received upon the exercise of any such remedy.
SECTION 15.05. Trustee to Effectuate Subordination.
Each Securityholder by such Securityholder's acceptance
thereof authorizes and directs the Trustee on such Securityholder's behalf to
take such action as may be necessary or appropriate to effectuate the
subordination provided in this Article XV and appoints the Trustee such
Securityholder's attorney-in-fact for any and all such purposes.
SECTION 15.06. Notice by the Company.
The Company shall give prompt written notice to a Responsible
Officer of the Trustee of any fact known to the Company that would prohibit the
making of any payment of monies to or by the Trustee in respect of the
Securities pursuant to the provisions of this Article XV. Notwithstanding the
provisions of this Article XV or any other provision of this Indenture, the
Trustee shall not be charged with knowledge of the existence of any facts that
would prohibit the making of any payment of monies to or by the Trustee in
respect of the Securities pursuant to the provisions of this Article XV, unless
and until a Responsible Officer of the Trustee assigned to its Principal Office
shall have received written notice thereof from the Company or a holder or
holders of Senior Indebtedness or from any trustee therefor; and before the
receipt of any such written notice, the Trustee, subject to the provisions of
Article VI of this Indenture, shall be entitled in all respects to assume that
no such facts exist; provided, however, that if the Trustee shall not have
received the notice provided for in this Section 15.06 at least two Business
Days prior to the date (i) upon which by the terms hereof any money may become
payable for any purpose (including, without limitation, the payment of the
principal of (or premium, if any) or interest on any Security), or (ii) moneys
and/or U.S. Government Obligations are deposited in trust pursuant to Article
XI, then anything herein contained to the contrary notwithstanding, the Trustee
shall have full power and authority to receive such money and U.S. Government
Obligations and to apply the same to the purposes for which they were received,
and shall not be affected by any notice to the contrary that may be received by
it within two Business Days prior to such date.
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The Trustee, subject to the provisions of Article VI of this
Indenture, shall be entitled to conclusively rely on the delivery to it of a
written notice by a Person representing him self to be a holder of Senior
Indebtedness of the Company (or a trustee or representative on behalf of such
holder), as the case may be, to establish that such notice has been given by a
holder of such Senior Indebtedness or a trustee or representative on behalf of
any such holder or holders. In the event that the Trustee determines in good
faith that further evidence is required with respect to the right of any Person
as a holder of such Senior Indebtedness to participate in any payment or
distribution pursuant to this Article XV, the Trustee may request such Person to
furnish evidence to the reasonable satisfaction of the Trustee as to the amount
of such Senior Indebtedness held by such Person, the extent to which such Person
is entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Article XV, and, if such
evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.
Upon any payment or distribution of assets of the Company
referred to in this Article XV, the Trustee and the Securityholders shall be
entitled to rely upon any order or decree entered by any court of competent
jurisdiction in which such insolvency, bankruptcy, receivership, liquidation,
reorganization, dissolution, winding up or similar case or proceeding is
pending, or a certificate of the trustee in bankruptcy, liquidating trustee,
custodian, receiver, assignee for the benefit of creditors, agent or other
person making such payment or distribution, delivered to the Trustee or to the
Securityholders, for the purpose of ascertaining the persons entitled to
participate in such payment or distribution, the holders of Senior Indebtedness
and other indebtedness of the Company, the amount thereof or payable thereon,
the amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article XV.
SECTION 15.07. Rights of the Trustee; Holders of Senior
Indebtedness.
The Trustee in its individual capacity shall be entitled to
all the rights set forth in this Article XV in respect of any Senior
Indebtedness at any time held by it, to the same extent as any other holder of
Senior Indebtedness, and nothing in
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this Indenture shall deprive the Trustee of any of its rights as such holder.
With respect to the holders of Senior Indebtedness, the
Trustee undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article XV, and no implied
covenants or obligations with respect to the holders of Senior Indebtedness
shall be read into this Indenture against the Trustee. The Trustee shall not be
deemed to owe any fiduciary duty to the holders of Senior Indebtedness and,
subject to the provisions of Article VI of this Indenture, the Trustee shall not
be liable to any holder of Senior Indebtedness if it shall pay over or deliver
to Securityholders, the Company or any other Person money or assets to which any
holder of Senior Indebtedness shall be entitled by virtue of this Article XV or
otherwise.
Nothing in this Article XV shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 6.06.
SECTION 15.08. Subordination May Not Be Impaired.
No right of any present or future holder of any Senior
Indebtedness to enforce subordination as herein provided shall at any time in
any way be prejudiced or impaired by any act or failure to act on the part of
the Company or by any act or failure to act, in good faith, by any such holder,
or by any noncompliance by the Company with the terms, provisions and covenants
of this Indenture, regardless of any knowledge thereof that any such holder may
have or otherwise be charged with.
Without in any way limiting the generality of the foregoing
paragraph, the holders of Senior Indebtedness may, at any time and from time to
time, without the consent of or notice to the Trustee or the Securityholders,
without incurring responsibility to the Securityholders and without impairing
or releasing the subordination provided in this Article XV or the obligations
hereunder of the holders of the Securities to the holders of Senior
Indebtedness, do any one or more of the following: (i) change the manner, place
or terms of payment or extend the time of payment of, or renew or alter, such
Senior Indebtedness, or otherwise amend or supplement in any manner such Senior
Indebtedness or any instrument evidencing the same or any agreement under which
such Senior Indebtedness is outstanding; (ii) sell, ex change, release or
otherwise deal with any property pledged,
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mortgaged or otherwise securing such Senior Indebtedness; (iii) release any
Person liable in any manner for the collection of such Senior Indebtedness; and
(iv) exercise or refrain from exercising any rights against the Company and any
other Person.
ARTICLE XVI
EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 16.01. Extension of Interest Payment Period.
So long as no Event of Default has occurred and is continuing,
the Company shall have the right, at any time and from time to time during the
term of the Securities, to defer payments of interest by extending the interest
payment period of such Securities for a period not exceeding 10 consecutive
semi-annual periods, including the first such semi-annual period during such
extension period (the "Extended Interest Payment Period"), during which Extended
Interest Payment Period no interest shall be due and payable; provided that no
Extended Interest Payment Period shall end on a date other than an Interest
Payment Date or extend beyond the Maturity Date. To the extent permitted by
applicable law, interest, the payment of which has been deferred because of the
extension of the interest payment period pursuant to this Section 16.01, will
bear interest thereon at the Coupon Rate compounded semi-annually for each
semi-annual period of the Extended Interest Payment Period ("Compounded
Interest"). At the end of the Extended Interest Payment Period, the Company
shall pay all interest accrued and unpaid on the Securities, including any
Additional Interest and Compounded Interest (together, "Deferred Interest") that
shall be payable to the holders of the Securities in whose names the Securities
are registered in the Security Register on the first record date preceding the
end of the Extended Interest Payment Period. Before the termination of any
Extended Interest Payment Period, the Company may further defer payments of
interest by further extending such period, provided that such period, together
with all such previous and further extensions within such Extended Interest
Payment Period, shall not exceed 10 consecutive semi-annual periods, including
the first such semi-annual period during such Extended Interest Payment Period,
or extend beyond the Maturity Date. Upon the termination of any Extended
Interest Payment Period and the payment of all Deferred Interest then due, the
Company may commence a new Extended Interest Payment Period,
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subject to the foregoing requirements. No interest shall be due and payable
during an Extended Interest Payment Period, except at the end thereof, but the
Company may prepay at any time all or any portion of the interest accrued during
an Extended Interest Payment Period.
SECTION 16.02. Notice of Extension.
(a) If the Property Trustee is the only registered holder of
the Securities at the time the Company selects an Extended Interest Payment
Period, the Company shall give written notice to the Administrative Trustees,
the Property Trustee and the Trustee of its selection of such Extended Interest
Payment Period five Business Days before the earlier of (i) the next succeeding
date on which Distributions on the Trust Securities issued by AGL Capital Trust
are payable, or (ii) the date AGL Capital Trust is required to give notice of
the record date, or the date such Distributions are payable, to any national
securities exchange or to holders of the Capital Securities issued by AGL
Capital Trust, but in any event at least five Business Days before such record
date.
(b) If the Property Trustee is not the only holder of the
Securities at the time the Company selects an Extended Interest Payment Period,
the Company shall give the holders of the Securities and the Trustee written
notice of its selection of such Extended Interest Payment Period at least 10
Business Days before the earlier of (i) the next succeeding Interest Payment
Date, or (ii) the date the Company is required to give notice of the record or
payment date of such interest payment to any national securities exchange.
(c) The semi-annual period in which any notice is given
pursuant to paragraphs (a) or (b) of this Section 16.02 shall be counted as one
of the 10 semi-annual periods permitted in the maximum Extended Interest Payment
Period permitted under Section 16.01.
Trustee hereby accepts the trusts in this Indenture declared
and provided, upon the terms and conditions hereinabove set forth.
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IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed by their respective officers thereunto duly
authorized, as of the day and year first above written.
AGL RESOURCES INC.
By /s/ J. Michael Riley
-------------------------------
Name: J. Michael Riley
Title: Vice President and Chief
Financial Officer
THE BANK OF NEW YORK,
as Trustee
By /s/ Stephen J. Giurlando
-------------------------------
Name: Stephen J. Giurlando
Title: Assistant Vice President
<PAGE> 102
EXHIBIT A
(FORM OF FACE OF SECURITY)
[IF THE SECURITY IS A GLOBAL SECURITY, INSERT: - THIS
SECURITY IS A GLOBAL SECURITY 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 SECURITY IS EXCHANGEABLE FOR 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 SECURITY
(OTHER THAN A TRANSFER OF THIS 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 SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC")
TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY SECURITY ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON
IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL IN AS MUCH AS SINCE THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES LAWS OR
ANY OTHER APPLICABLE SECURITIES LAW. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO
OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUANCE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY
"AFFILIATE" OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF
THIS SECURITY) ONLY (A) TO THE COMPANY, (B) PURSUANT TO A REGIS-
A-2
<PAGE> 103
TRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT,
(C) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER
THE SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A) THAT PURCHASES FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE
IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT
TO OFFERS AND SALES TO NONU.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES
WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF SUB PARAGRAPH (A)(1),
(2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS
SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL
ACCREDITED INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR
OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE
SECURITIES ACT, OR (F) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS UNDER THE SECURITIES ACT, SUBJECT TO THE RIGHT OF THE
COMPANY PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (i) PURSUANT TO CLAUSE (D),
(E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATIONS
AND/OR OTHER INFORMATION SATISFACTORY TO THE COMPANY, AND (ii) PURSUANT TO
CLAUSE (E), TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON
THE REVERSE OF THIS SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEREE TO THE
COMPANY. SUCH HOLDER FURTHER AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM
THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND.
No. CUSIP No.
--------------
A-3
<PAGE> 104
AGL RESOURCES INC.
8.17% SERIES JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURE
DUE JUNE 30, 2037
AGL Resources Inc., a Georgia corporation (the "Company",
which term includes any successor Person under the Indenture hereinafter
referred to), for value received, hereby promises to pay to ______________ or
registered assigns, the principal sum of _____________ Dollars on June 30, 2037
(the "Maturity Date"), unless previously redeemed, and to pay interest on the
outstanding principal amount hereof from June 11, 1997, 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, semi-annually (subject to deferral
as set forth herein) in arrears on December 1 and June 1 of each year,
commencing December 1, 1997 at the rate of 8.17% per annum until the principal
hereof shall have become due and payable, and at the same rate per annum 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 compounded
semi-annually. 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 less than a full calendar month, the number of days elapsed in such
month. In the event that any date on which the principal of (or premium, if any)
or interest on this Security is payable is not a Business Day, then the payment
payable on such date will be made on the next succeeding day that is a Business
Day (and without any interest or other payment in respect of any such delay),
with the same force and effect as if made on such date. Pursuant to the
Registration Rights Agreement, in certain limited circumstances the Company will
be required to pay Liquidated Damages (as defined in the Registration Rights
Agreement) with respect to this Security.
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 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 May 15 or November 15 immediately preceding the relevant interest
payment date. Any such interest installment not punctu-
A-4
<PAGE> 105
ally paid or duly provided for shall forthwith cease to be payable to the
holders on such regular record date and may be paid to the Person in whose name
this Security (or one or more Predecessor Securities) is registered at the close
of business on a special record date to be fixed by the Trustee for the payment
of such defaulted interest, notice whereof shall be given to the holders of
Securities 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 Securities 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 interest on this
Security shall be payable at the office or agency of the Trustee maintained for
that purpose in any coin or currency of the United States of America that 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 (i) check mailed to the holder at such address as shall appear in the
Security Register or (ii) by transfer to an account maintained by the Person
entitled thereto, provided that proper written transfer instructions have been
received by the relevant record date. Notwithstanding the foregoing, so long as
the Holder of this Security is the Property Trustee, the payment of the
principal of (and premium, if any) and interest on this Security will be made at
such place and to such account as may be designated by the Property Trustee.
The indebtedness evidenced by this 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 Security is issued
subject to the provisions of the Indenture with respect thereto. Each holder of
this Security, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his 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 subor-
dination 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.
A-5
<PAGE> 106
This Security shall not be entitled to any benefit under the
Indenture hereinafter referred to, or 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.
A-6
<PAGE> 107
The provisions of this Security are continued on the reverse
side hereof and such 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.
AGL RESOURCES INC.
By:
----------------------------
Name:
Title
Attest:
By:
--------------------------
Name:
Title:
A-7
<PAGE> 108
(FORM OF CERTIFICATE OF AUTHENTICATION)
CERTIFICATE OF AUTHENTICATION
This is one of the Securities referred to in the
within-mentioned Indenture.
Dated
--------------
THE BANK OF NEW YORK,
as Trustee
By
------------------
Authorized Officer
A-8
<PAGE> 109
(FORM OF REVERSE OF SECURITY)
This Security is one of the Securities of the Company (herein
sometimes referred to as the "Securities"), specified in the Indenture, all
issued or to be issued under and pursuant to an Indenture, dated as of June [ ],
1997 (the "Indenture"), duly executed and delivered between the Company and The
Bank of New York, as Trustee (the "Trustee"), to which Indenture 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 Securities.
Upon the occurrence and continuation of a Tax Event, the
Company shall have the right at any time, within 90 days following the
occurrence of a Tax Event, prior to June 30, 2007 (the "Initial Optional
Redemption Date"), to redeem this Security in whole (but not in part) at the Tax
Event Redemption Price. "Tax Event Redemption Price" shall mean, with respect to
any redemption of the Securities following a Tax Event, an amount in cash equal
to the greater of (i) 100% of the principal amount to be redeemed or (ii) the
sum, as determined by a Quotation Agent, of the present values of the principal
amount and premium payable with respect to an Optional Redemption (as defined
below) on the Initial Optional Redemption Date, together with scheduled payments
of interest on the Securities from the redemption date to and including the
Initial Optional Redemption Date, discounted to the redemption date on a
semi-annual basis (assuming a 360-day year consisting of twelve 30-day months)
at the Adjusted Treasury Rate, plus, in each case, any accrued and unpaid
interest there on, including Compounded Interest and Additional Interest, if
any, to the date of such redemption.
In addition, the Company shall have the right to redeem this
Security, in whole or in part, at any time on or after the Initial Optional
Redemption Date (an "Optional Redemption"), at a redemption price (the "Optional
Redemption Price") equal to the percentage of the outstanding principal amount
of the Debentures specified below, plus, in each case, accrued interest thereon
to the date of redemption if redeemed during the 12-month period beginning June
30 of the years indicated below.
A-9
<PAGE> 110
<TABLE>
<CAPTION>
Year Percentage
---- ----------
<S> <C>
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017 and thereafter 100.000%
</TABLE>
The Optional Redemption Price or the Tax Event Redemption
Price, as the case requires, shall be paid prior to 12:00 noon, New York time,
on the date of such redemption or at such earlier time as the Company
determines, provided, that the Company shall deposit with the Trustee an amount
sufficient to pay the applicable Redemption Price by 10:00 a.m., New York City
time, on the date such Redemption Price is to be paid. Any redemption pursuant
to this paragraph will be made upon not less than 30 days nor more than 60 days
notice. If the Securities are only partially redeemed by the Company pursuant to
an Optional Redemption, the Securities will be redeemed pro rata or by lot or by
any other method utilized by the Trustee; provided that if, at the time of
redemption, the Securities are registered as a Global Security, the Depositary
shall determine in accordance with its procedures the principal amount of such
Securities held for the account of its participants to be redeemed.
In the event of redemption of this Security in part only, a
new Security or Securities for the unredeemed portion hereof will be issued in
the name of the holder hereof upon the cancellation hereof.
Notwithstanding the foregoing, any redemption of Securities by
the Company shall be subject to the receipt by the Company of any required
regulatory approval.
In case an Event of Default, as defined in the Indenture,
shall have occurred and be continuing, the principal of all of the 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.
A-10
<PAGE> 111
The Indenture contains provisions permitting the Company and
the Trustee, with the consent of the holders of a majority in aggregate
principal amount of the Securities at the time outstanding, 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 modifying in any manner the rights of the holders of the
Securities; provided, however, that no such supplemental indenture shall,
without the consent of each holder of Securities then outstanding and affected
thereby, (i) extend the Maturity Date of any Securities, or reduce the principal
amount thereof, or reduce any amount payable on redemption thereof, or reduce
the rate or extend the time of payment of interest thereon (subject to Article
XVI of the Indenture), or make the principal of, or interest or premium on, the
Securities payable in any coin or currency other than U.S. dollars, or impair or
affect the right of any holder of Securities to institute suit for the payment
thereof, or (ii) reduce the aforesaid percentage of 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 Securities at the time out standing, on behalf of all of
the holders of the Securities, to waive any past default in the performance of
any of the covenants contained in the Indenture, or established pursuant to the
Indenture, and its consequences, except a default in the payment of the
principal of or premium, if any, or interest on any of the Securities or a
default in respect of any covenant or provision under which the Indenture cannot
be modified or amended without the consent of each holder of Securities then
outstanding. Any such consent or waiver by the holder of this 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 Security and of any
Security issued in exchange herefor or in place hereof (whether by registration
of transfer or other wise), irrespective of whether or not any notation of such
consent or waiver is made upon this Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and
premium, if any, and interest on this Security at the time and place and at the
rate and in the money herein prescribed.
A-11
<PAGE> 112
The Company shall have the right, at any time and from time to
time during the term of the Securities, to defer payments of interest by
extending the interest payment period of such Securities for a period not
exceeding 10 consecutive semi-annual periods, including the first such
semi-annual period during such extension period, and not to extend beyond the
Maturity Date of the Securities (an "Extended Interest Payment Period"), at the
end of which period the Company shall pay all interest then accrued and unpaid
(together with interest thereon at the rate specified for the Securities to the
extent that payment of such interest is enforceable under applicable law).
Before the termination of any such Extended Interest Payment Period, the
Company may further defer payments of interest by further extending such
Extended Interest Payment Period, provided that such Extended Interest Payment
Period, together with all such previous and further extensions within such
Extended Interest Payment Period, shall not exceed 10 consecutive semi-annual
periods, including the first semi-annual period during such Extended Interest
Payment Period shall not end on any date other than an Interest Payment Date, or
extend beyond the Maturity Date of the Securities. Upon the termination of any
such Extended Interest Payment Period and the payment of all accrued and unpaid
interest and any additional amounts then due, the Company may commence a new
Extended Interest Payment Period, subject to the foregoing requirements.
The Company has agreed that it will not (i) declare or pay any
dividends or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of the Company's capital stock (which
includes common and preferred stock) or (ii) make any payment of principal,
interest or premium, if any, on or repay or repurchase or redeem any debt
securities of the Company that rank pari passu with or junior in right of
payment to the Securities or (iii) make any guarantee payments with respect to
any guarantee by the Company of any securities or any Subsidiary of the Company
(including any Other Guarantees) if such guarantee ranks pari passu or junior in
right of payment to the Securities (other than (a) dividends or distributions in
shares of, or options, warrants or rights to subscribe for or purchase shares
of, Common Stock of the Company; (b) any declaration of a dividend in
connection with the implementation of a stockholder's rights plan, or the
issuance of stock under any such plan in the future, or the redemption or
repurchase of any such rights pursuant thereto; (c) payments under the Capital
Securities Guarantee; (d) as a direct result of, and only to the
A-12
<PAGE> 113
extent required in order to avoid the issuance of fractional shares of capital
stock, following a reclassification of the Company's capital stock or the
exchange or conversion of one class or series of the Company's capital stock for
another class or series of the Company's capital stock; and (e) the purchase of
fractional interests in shares of the Company's capital stock pursuant to the
exchange or conversion of such capital stock or the security being exchanged or
converted) if at such time (i) an Event of Default shall have occurred and be
continuing, (ii) there shall have occurred any event of which the Company has
actual knowledge that (a) is, or with the giving of notice or the lapse of time,
or both, would be, an Event of Default and (b) in respect of which the Company
shall not have taken reasonable steps to cure, (iii) the Company shall be in
default with respect to its payment obligations under the Capital Securities
Guarantee or (iv) the Company shall have given notice of its election of the
exercise of its right to extend the interest payment period, or any extension
thereof, pursuant to Section 16.01 of the Indenture and shall not have rescinded
such notice, and such exercise of its right to extend the interest payment
period, or any extension thereof, shall have commenced.
The Securities are issuable only in registered form without
coupons in denominations of $1,000.00 and any integral multiple thereof. As
provided in the Indenture and subject to the transfer restrictions limitations
as may be contained herein and therein from time to time, this Security is
transferable by the holder hereof on the Security Register of the Company, upon
surrender of this Security for registration of transfer at the office or agency
of the Company in the City and State of New York accompanied by a written
instrument or instruments of transfer in form satisfactory to the Company or the
Security registrar duly executed by the holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Securities of authorized
denominations and for the same aggregate principal amount and series 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
Security, the Company, the Trustee, any authenticating agent, any paying agent,
any transfer agent and the registrar may deem and treat the holder hereof as the
absolute owner hereof
A-13
<PAGE> 114
(whether or not this 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 premium, if any, and (subject to the Indenture) interest due hereon and for
all other purposes, and neither the Company nor the Trustee nor any
authenticating agent nor any paying agent nor any transfer agent nor any
registrar shall be affected by any notice to the contrary.
No recourse shall be had for the payment of the principal of
or premium, if any, or interest on this 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 Person,
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.
All terms used in this Security that are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
THE INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
CONFLICT OF LAW PROVISIONS THEREOF.
A-14
<PAGE> 1
EXHIBIT 4.3
CERTIFICATE OF TRUST
The undersigned, the trustee of AGL Capital Trust, desiring to
form a business trust pursuant to the Delaware Business Trust Act, 12 Del. C.
Section 3810, hereby certifies as follows:
i. The name of the business trust being formed hereby
(the "Trust") is "AGL Capital Trust."
ii. The name and business address of the trustee of the
Trust which has its principal place of business in
the State of Delaware is as follows:
The Bank of New York (Delaware)
White Clay Center, Route 273
Newark, Delaware 19711
iii. This Certificate of Trust shall be effective as of
the date of filing.
Dated: June 6, 1997
THE BANK OF NEW YORK (DELAWARE),
as Delaware Trustee
By: /s/ Walter N. Gitlin
--------------------------------
Name: Waltern N. Gitlin
Title: Authorized Signatory
<PAGE> 1
EXHIBIT 4.4
================================================================================
AMENDED AND RESTATED DECLARATION
OF TRUST
AGL CAPITAL TRUST
DATED AS OF JUNE 11, 1997
================================================================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Definitions................................................... 2
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.............................. 11
SECTION 2.2 Lists of Holders of Securities................................ 12
SECTION 2.3 Reports by the Property Trustee............................... 12
SECTION 2.4 Periodic Reports to Property Trustee.......................... 13
SECTION 2.5 Evidence of Compliance with Conditions Precedent.............. 13
SECTION 2.6 Events of Default; Waiver..................................... 13
SECTION 2.7 Event of Default; Notice...................................... 16
ARTICLE III
ORGANIZATION
SECTION 3.1 Name.......................................................... 17
SECTION 3.2 Office........................................................ 17
SECTION 3.3 Purpose....................................................... 17
SECTION 3.4 Authority..................................................... 17
SECTION 3.5 Title to Property of the Trust................................ 18
SECTION 3.6 Powers and Duties of the Administrative Trustees.............. 18
SECTION 3.7 Prohibition of Actions by the Trust and the Trustees.......... 22
SECTION 3.8 Powers and Duties of the Property Trustee..................... 23
SECTION 3.9 Certain Duties and Responsibilities of the Property Trustee... 26
SECTION 3.10 Certain Rights of Property Trustee............................ 29
SECTION 3.11 Delaware Trustee.............................................. 32
SECTION 3.12 Execution of Documents........................................ 32
SECTION 3.13 Not Responsible for Recitals or Issuance of Securities........ 32
SECTION 3.14 Duration of Trust............................................. 32
</TABLE>
i
<PAGE> 3
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
SECTION 3.15 Mergers....................................................... 33
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities....................... 35
SECTION 4.2 Responsibilities of the Sponsor............................... 35
SECTION 4.3 Right to Proceed.............................................. 36
ARTICLE V
TRUSTEES
SECTION 5.1 Number of Trustees: Appointment of Co-Trustee................. 36
SECTION 5.2 Delaware Trustee.............................................. 37
SECTION 5.3 Property Trustee; Eligibility................................. 38
SECTION 5.4 Certain Qualifications of Administrative Trustees and
Delaware Trustee Generally.................................... 39
SECTION 5.5 Administrative Trustees....................................... 39
SECTION 5.6 Delaware Trustee.............................................. 40
SECTION 5.7 Appointment, Removal and Resignation of Trustees.............. 40
SECTION 5.8 Vacancies among Trustees...................................... 42
SECTION 5.9 Effect of Vacancies........................................... 42
SECTION 5.10 Meetings...................................................... 42
SECTION 5.11 Delegation of Power........................................... 43
Section 5.12 Merger, Conversion, Consolidation or Succession to Business... 44
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions................................................. 44
</TABLE>
ii
<PAGE> 4
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities....................... 45
SECTION 7.2 Execution and Authentication.................................. 46
SECTION 7.3 Form and Dating............................................... 47
SECTION 7.4 Registrar, Paying Agent and Exchange Agent.................... 49
SECTION 7.5 Paying Agent to Hold Money in Trust........................... 50
SECTION 7.6 Replacement Securities........................................ 50
SECTION 7.7 Outstanding Capital Securities................................ 50
SECTION 7.8 Capital Securities in Treasury................................ 51
SECTION 7.9 Temporary Securities.......................................... 51
SECTION 7.10 Cancellation.................................................. 52
SECTION 7.11 CUSIP Numbers................................................. 53
ARTICLE VIII
TERMINATION OF TRUST
SECTION 8.1 Termination of Trust.......................................... 53
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 Transfer of Securities........................................ 54
SECTION 9.2 Transfer Procedures and Restrictions.......................... 55
SECTION 9.3 Deemed Security Holders....................................... 65
SECTION 9.4 Book Entry Interests.......................................... 66
SECTION 9.5 Notices to Clearing Agency.................................... 67
SECTION 9.6 Appointment of Successor Clearing Agency...................... 67
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability..................................................... 67
SECTION 10.2 Exculpation................................................... 68
SECTION 10.3 Fiduciary Duty................................................ 68
SECTION 10.4 Indemnification............................................... 69
SECTION 10.5 Outside Businesses............................................ 73
</TABLE>
iii
<PAGE> 5
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year................................................... 74
SECTION 11.2 Certain Accounting Matters.................................... 74
SECTION 11.3 Banking....................................................... 75
SECTION 11.4 Withholding................................................... 75
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments.................................................... 76
SECTION 12.2 Meetings of the Holders of Securities; Action by
Written Consent............................................... 78
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1 Representations and Warranties of Property Trustee............ 80
SECTION 13.2 Representations and Warranties of Delaware Trustee............ 81
ARTICLE XIV
REGISTRATION RIGHTS
SECTION 14.1 Registration Rights Agreement; Liquidated Damages............. 82
ARTICLE XV
MISCELLANEOUS
SECTION 15.1 Notices....................................................... 82
SECTION 15.2 Governing Law................................................. 84
SECTION 15.3 Intention of the Parties...................................... 84
SECTION 15.4 Headings...................................................... 84
</TABLE>
iv
<PAGE> 6
<TABLE>
<CAPTION>
Page
----
<S> <C>
SECTION 15.5 Successors and Assigns........................................ 84
SECTION 15.6 Partial Enforceability........................................ 85
SECTION 15.7 Counterparts.................................................. 85
ANNEX I TERMS OF SECURITIES........................................... I-1
EXHIBIT A-1 FORM OF CAPITAL SECURITY CERTIFICATE..........................A1-1
EXHIBIT A-2 FORM OF COMMON SECURITY CERTIFICATE...........................A2-1
EXHIBIT B SPECIMEN OF DEBENTURE......................................... B-1
EXHIBIT C PURCHASE AGREEMENT............................................ C-1
</TABLE>
v
<PAGE> 7
AMENDED AND RESTATED
DECLARATION OF TRUST
OF
AGL CAPITAL TRUST
June 11, 1997
AMENDED AND RESTATED DECLARATION OF TRUST ("Declaraion") dated
and effective as of June 11, 1997, by the Trustees (as defined herein), the
Sponsor (as defined herein) and by the holders, from time to time, of undivided
beneficial interests in the assets of the Trust to be issued pursuant to this
Declaration;
WHEREAS, the Trustees and the Sponsor established AGL Capital
Trust (the "Trust"), a trust formed under the Delaware Business Trust Act
pursuant to a Declaration of Trust dated as of June 6, 1997 (the "Original
Declaration"), and a Certificate of Trust filed with the Secretary of State of
the State of Delaware on June 6, 1997, for the sole purpose of issuing and
selling certain securities representing undivided beneficial interests in the
assets of the Trust and investing the proceeds thereof in certain Debentures of
the Debenture Issuer (each as hereinafter defined);
WHEREAS, as of the date hereof, no interests in the Trust have
been issued;
WHEREAS, all of the Trustees and the Sponsor, by this
Declaration, amend and restate each and every term and provision of the Original
Declaration; and
NOW, THEREFORE, it being the intention of the parties hereto
to continue the Trust as a business trust under the Business Trust Act (as
defined herein) and that this Declaration constitute the governing instrument of
such business trust, the Trustees declare that all assets contributed to the
Trust will be held in trust for the benefit of the holders, from time to time,
of the securities representing undivided beneficial interests in the assets of
the Trust issued hereunder, subject to the provisions of this Declaration.
<PAGE> 8
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Definitions.
Unless the context otherwise requires:
(a) Capitalized terms used in this Declaration but not defined
in the preamble above have the respective meanings assigned to them in
this Section 1.1;
(b) a term defined anywhere in this Declaration has the same
meaning throughout;
(c) all references to "the Declaration" or "this Declaration"
are to this Declaration as modified, supplemented or amended from time
to time;
(d) all references in this Declaration to Articles and
Sections and Annexes and Exhibits are to Articles and Sections of and
Annexes and Exhibits to this Declaration unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same
meaning when used in this Declaration unless otherwise defined in this
Declaration or unless the context otherwise requires; and
(f) a reference to the singular includes the plural and vice
versa.
"Administrative Trustee" has the meaning set forth in Section
5.1.
"Affiliate" has the same meaning as given to that term in Rule
405 under the Securities Act or any successor rule thereunder.
"Agent" means any Paying Agent, Registrar or Exchange Agent.
"Authorized Officer" of a Person means any other Person that
is authorized to legally bind such former Person.
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"Book Entry Interest" means a beneficial interest in a Global
Certificate registered in the name of a Clearing Agency or its nominee,
ownership and transfers of which shall be maintained and made through book
entries by a Clearing Agency as described in Section 9.4.
"Business Day" means any day other than a Saturday or a Sunday
or a day on which banking institutions in the City of New York, New York or
Atlanta, Georgia are authorized or required by law or executive order to close.
"Business Trust Act" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code ss.3801 et seq., as it may be amended from time to
time, or any successor legislation.
"Capital Security Beneficial Owner" means, with respect to a
Book Entry Interest, a Person who is the beneficial owner of such Book Entry
Interest, as reflected on the books of the Clearing Agency, or on the books of a
Person maintaining an account with such Clearing Agency (directly as a Clearing
Agency Participant or as an indirect participant, in each case in accordance
with the rules of such Clearing Agency).
"Capital Securities" means, collectively, the Series A Capital
Securities and the Series B Capital Securities.
"Capital Securities Guarantee" means, collectively, the Series
A Capital Securities Guarantee and the Series B Capital Securities Guarantee.
"Clearing Agency" means an organization registered as a
"Clearing Agency" pursuant to Section 17A of the Exchange Act that is acting as
depositary for the Capital Securities and in whose name or in the name of a
nominee of that organization shall be registered a Global Certificate and which
shall undertake to effect book entry transfers and pledges of the Capital
Securities.
"Clearing Agency Participant" means a broker, dealer, bank,
other financial institution or other Person for whom from time to time the
Clearing Agency effects book entry transfers and pledges of securities deposited
with the Clearing Agency.
"Closing Time" means the "Closing Time" under the Purchase
Agreement.
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"Code" means the Internal Revenue Code of 1986, as amended
from time to time, or any successor legislation.
"Commission" means the United States Securities and Exchange
Commission as from time to time constituted, or if any time after the execution
of this Declaration such Commission is not existing and performing the duties
now assigned to it under applicable Federal securities laws, then the body
performing such duties at such time.
"Common Securities" has the meaning specified in Section
7.1(a).
"Common Securities Guarantee" means the guarantee agreement
dated as of June 11, 1997 of the Sponsor in respect of the Common Securities.
"Company Indemnified Person" means (a) any Administrative
Trustee; (b) any Affiliate of any Administrative Trustee; (c) any officers,
directors, shareholders, members, partners, employees, representatives or agents
of any Administrative Trustee; or (d) any officer, employee or agent of the
Trust or its Affiliates.
"Corporate Trust Office" means the office of the Property
Trustee at which the corporate trust business of the Property Trustee shall, at
any particular time, be principally administered, which office at the date of
execution of this Agreement is located at 101 Barclay Street, 21 West, New York,
New York 10286, Attention: Corporate Trust Trustee Administration.
"Covered Person" means: (a) any officer, director,
shareholder, partner, member, representative, employee or agent of (i) the Trust
or (ii) the Trust's Affiliates; and (b) any Holder of Securities.
"Debenture Issuer" means AGL Resources Inc., a Georgia
corporation, or any successor entity resulting from any consolidation,
amalgamation, merger or other business combination, in its capacity as issuer of
the Debentures under the Indenture.
"Debenture Trustee" means The Bank of New York, a New York
banking corporation, as trustee under the Indenture until a
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successor is appointed thereunder, and thereafter means such successor trustee.
"Debentures" means, collectively, the Series A Debentures and
the Series B Debentures.
"Default" means an event, act or condition that with notice of
lapse of time, or both, would constitute an Event of Default.
"Definitive Capital Securities" shall have the meaning set
forth in Section 7.3(c).
"Delaware Trustee" has the meaning set forth in Section 5.2.
"Direct Action" shall have the meaning set forth in Section
3.8(e).
"Distribution" means a distribution payable to Holders in
accordance with Section 6.1.
"DTC" means The Depository Trust Company, the initial Clearing
Agency.
"Event of Default" in respect of the Securities means:
(a) the occurrence of a Debenture Event of Default; or
(b) default by the Trust or the Property Trustee in the
payment of any Distribution when it becomes due and payable, and
continuation of such default for a period of 30 days; or
(c) default by the Trust or the Property Trustee in the
payment of any Redemption Price of any Security when it becomes due and
payable; or
(d) default in the performance, or breach, in any material
respect, of any covenant or warranty of the Trustees in this
Declaration (other than a covenant or warranty a default in the
performance of which or the breach of which is dealt with in clause (b)
or (c), above) and continuation of such default or breach for a period
of 60 days after there has been given, by registered or certified
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mail, to the defaulting Trustee or Trustees by the Holders of at least
25% in liquidation amount of the outstanding Capital Securities a
written notice specifying such default or breach and requiring it to be
remedied and stating that such notice is a "Notice of Default"
hereunder.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, or any successor legislation.
"Exchange Agent" has the meaning set forth in Section 7.4.
"Exchange Offer" means the offer that may be made pursuant to
the Registration Rights Agreement (i) by the Trust to exchange Series B Capital
Securities for Series A Capital Securities and (ii) by the Debenture Issuer to
exchange Series B Debentures for Series A Debentures and the Series B Capital
Securities Guarantee for the Series A Capital Securities Guarantee.
"Fiduciary Indemnified Person" has the meaning set forth in
Section 10.4(b).
"Global Capital Securities" has the meaning set forth in
Section 7.3(a).
"Global Capital Security" has the meaning set forth in Section
7.3(a).
"Holder" means a Person in whose name a Security is
registered, such Person being a beneficial owner within the meaning of the
Business Trust Act.
"Indemnified Person" means a Company Indemnified Person or a
Fiduciary Indemnified Person.
"Indenture" means the Indenture dated as of June 11, 1997,
among the Debenture Issuer and The Bank of New York, as amended from time to
time.
"Investment Company" means an investment company as defined in
the Investment Company Act.
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"Investment Company Act" means the Investment Company Act of
1940, as amended from time to time, or any successor legislation.
"Legal Action" has the meaning set forth in Section 3.6(g).
"Majority in liquidation amount" means, with respect to the
Trust Securities, except as provided in the terms of the Capital Securities or
by the Trust Indenture Act, Holder(s) of outstanding Trust Securities voting
together as a single class or, as the context may require, Holders of
outstanding Capital Securities or Holders of outstanding Common Securities
voting separately as a class, who are the record owners of more than 50% of the
aggregate liquidation amount (including the stated amount that would be paid on
redemption, liquidation or otherwise, plus accrued and unpaid Distributions to
the date upon which the voting percentages are determined) of all outstanding
Securities of the relevant class.
"Ministerial Action" has the meaning set forth in Annex I
hereto.
"Offering Memorandum" has the meaning set forth in Section
3.6(b).
"Officers' Certificate" means, with respect to any Person, a
certificate signed by the Chairman, a Vice Chairman, the Chief Executive
Officer, the President, a Vice President, the Comptroller, the Treasurer or an
Assistant Treasurer, the Secretary or an Assistant Secretary, or the Secretary
or an Assistant Secretary of such Person. Any Officers' Certificate delivered
with respect to compliance with a condition or covenant provided for in this
Declaration shall include:
(a) a statement that each officer signing the Certificate has
read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer in rendering
the Certificate;
(c) a statement that each such officer has made such
examination or investigation as, in such officer's opinion,
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is necessary to enable such officer to express an informed opinion as
to whether or not such covenant or condition has been complied with;
and
(d) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
"Opinion of Counsel" shall mean a written opinion of counsel,
who may be an employee of the Sponsor, and who shall be acceptable to the
Property Trustee.
"Paying Agent" has the meaning specified in Section 7.4.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Property Trustee" has the meaning set forth in Section
5.3(a).
"Property Trustee Account" has the meaning set forth in
Section 3.8(c).
"Purchase Agreement" means the Purchase Agreement for the
initial offering and sale of Capital Securities in the form of Exhibit C.
"QIBs" shall mean qualified institutional buyers as defined in
Rule 144A.
"Quorum" means a majority of the Administrative Trustees or,
if there are only two Administrative Trustees, both of them.
"Registrar" has the meaning set forth in Section 7.4.
"Registration Rights Agreement" means the Registration Rights
Agreement dated as of June 11, 1997, by and among the Trust, the Debenture
Issuer and the Initial Purchasers named therein, as amended from time to time.
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"Registration Statement" has the meaning set forth in the
Registration Rights Agreement.
"Related Party" means, with respect to the Sponsor, any direct
or indirect wholly owned subsidiary of the Sponsor or any other Person that
owns, directly or indirectly, 100% of the outstanding voting securities of the
Sponsor.
"Responsible Officer" means, with respect to the Property
Trustee, any officer within the Corporate Trust Office of the Property Trustee,
including any vice-president, any assistant vice-president, any assistant
secretary, the treasurer, any assistant treasurer or other officer of the
Corporate Trust Office of the Property Trustee customarily performing functions
similar to those performed by any of the above designated officers and also
means, with respect to a particular corporate trust matter, any other officer to
whom such matter is referred because of that officer's knowledge of and
familiarity with the particular subject.
"Restricted Definitive Capital Securities" has the meaning set
forth in Section 7.3(c).
"Restricted Capital Security" means a Capital Security
required by Section 9.2 to contain a Restricted Securities Legend.
"Restricted Global Capital Security" has the meaning set forth
in Section 7.3(a).
"Restricted Securities Legend" has the meaning set forth in
Section 7.3.
"Rule 3a-5" means Rule 3a-5 under the Investment Company Act,
or any successor rule or regulation.
"Rule 144" means Rule 144 under the Securities Act, as such
rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission.
"Rule 144A" means Rule 144A under the Securities Act, as such
rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission.
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"Securities" or "Trust Securities" means the Common Securities
and the Capital Securities.
"Securities Act" means the Securities Act of 1933, as amended
from time to time, or any successor legislation.
"Securities Guarantees" means the Common Securities Guarantee
and the Capital Securities Guarantee.
"Series A Capital Securities" has the meaning specified in
Section 7.1(a).
"Series B Capital Securities" has the meaning specified in
Section 7.1(a).
"Series A Capital Securities Guarantee" means the Series A
Capital Securities Guarantee Agreement dated as of June 11, 1997, by the Sponsor
in respect of the Series A Capital Securities.
"Series B Capital Securities Guarantee" means the guarantee
agreement to be entered in connection with the Exchange Offer by the Sponsor in
respect of the Series B Capital Securities.
"Series A Debentures" means the Series A 8.17% Junior
Subordinated Deferrable Interest Debentures due June 1, 2037 of the Debenture
Issuer issued pursuant to the Indenture.
"Series B Debentures" means the Series B 8.17% Junior
Subordinated Deferrable Interest Debentures due June 1, 2037 of the Debenture
Issuer issued pursuant to the Indenture.
"Sponsor" means AGL Resources Inc., a Georgia corporation, or
any successor entity resulting from any merger, consolidation, amalgamation or
other business combination, in its capacity as sponsor of the Trust.
"Super Majority" has the meaning set forth in Section
2.6(a)(ii).
"Treasury Regulations" means the income tax regulations,
including temporary and proposed regulations, promulgated under the Code by the
United States Treasury, as such
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regulations may be amended from time to time (including corresponding provisions
of succeeding regulations).
"Trustee" or "Trustees" means each Person who has signed this
Declaration as a trustee, so long as such Person shall continue in office in
accordance with the terms hereof, and all other Persons who may from time to
time be duly appointed, qualified and serving as Trustees in accordance with the
provisions hereof, and references herein to a Trustee or the Trustees shall
refer to such Person or Persons solely in their capacity as trustees hereunder.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended from time to time, or any successor legislation.
"25% in liquidation amount" means, with respect to the Trust
Securities, except as provided in the terms of the Capital Securities or by the
Trust Indenture Act, Holder(s) of outstanding Trust Securities voting together
as a single class or, as the context may require, Holders of outstanding Capital
Securities or Holders of outstanding Common Securities voting separately as a
class, who are the record owners of 25% or more of the aggregate liquidation
amount (including the stated amount that would be paid on redemption,
liquidation or otherwise, plus accrued and unpaid Distributions to the date upon
which the voting percentages are determined) of all outstanding Securities of
the relevant class.
"Unrestricted Global Capital Security" has the meaning set
forth in Section 9.2(b).
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.
(a) This Declaration is subject to the provisions of the Trust
Indenture Act that would be required to be part of this Declaration, if this
Declaration were to be qualified under the Trust Indenture Act, and shall, to
such extent, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is a
Trustee for the purposes of the Trust Indenture Act.
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(c) If and to the extent that any provision of this
Declaration limits, qualifies or conflicts with the duties imposed by Sections
310 to 317, inclusive, of the Trust Indenture Act, such imposed duties shall
control.
(d) The application of the Trust Indenture Act to this
Declaration shall not affect the nature of the Securities as equity securities
representing undivided beneficial interests in the assets of the Trust.
SECTION 2.2 Lists of Holders of Securities.
(a) Each of the Sponsor and the Administrative Trustees on
behalf of the Trust shall provide the Property Trustee, unless the Property
Trustee is Registrar for the Securities (i) within 14 days after each record
date for payment of Distributions, a list, in such form as the Property Trustee
may reasonably require, of the names and addresses of the Holders ("List of
Holders") as of such record date, provided that neither the Sponsor nor the
Administrative Trustees on behalf of the Trust shall be obligated to provide
such List of Holders at any time the List of Holders does not differ from the
most recent List of Holders given to the Property Trustee by the Sponsor and the
Administrative Trustees on behalf of the Trust, and (ii) at any other time,
within 30 days of receipt by the Trust of a written request for a List of
Holders as of a date no more than 14 days before such List of Holders is given
to the Property Trustee. The Property Trustee shall preserve, in as current a
form as is reasonably practicable, all information contained in Lists of Holders
given to it or which it receives in the capacity as Paying Agent (if acting in
such capacity), provided that the Property Trustee may destroy any List of
Holders previously given to it on receipt of a new List of Holders.
(b) The Property Trustee shall comply with its obligations
under Sections 311(a), 311(b) and 312(b) of the Trust Indenture Act.
SECTION 2.3 Reports by the Property Trustee.
Within 60 days after May 15 of each year, commencing May 15,
1998, the Property Trustee shall provide to the Holders of the Capital
Securities such reports as are required by Section 313 of the Trust Indenture
Act, if any, in the form and in the manner provided by Section 313 of the Trust
Indenture Act. The Property
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Trustee shall also comply with the requirements of Section 313(d) of the Trust
Indenture Act.
SECTION 2.4 Periodic Reports to Property Trustee.
Each of the Sponsor and the Administrative Trustees on behalf
of the Trust shall provide to the Property Trustee such documents, reports and
information as are required by Section 314 (if any) and the compliance
certificate required by Section 314 of the Trust Indenture Act in the form, in
the manner and at the times required by Section 314(a)(4) of the Trust Indenture
Act, such compliance certificate to be delivered annually on or before 120 days
after the end of each fiscal year of the Sponsor.
SECTION 2.5 Evidence of Compliance with Conditions Precedent.
Each of the Sponsor and the Administrative Trustees on behalf
of the Trust shall provide to the Property Trustee such evidence of compliance
with any conditions precedent provided for in this Declaration that relate to
any of the matters set forth in Section 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given by an officer pursuant to Section
314(c) (1) of the Trust Indenture Act may be given in the form of an Officers'
Certificate.
SECTION 2.6 Events of Default; Waiver.
(a) The Holders of a Majority in liquidation amount of
Capital Securities may, by vote, on behalf of the Holders of all of the Capital
Securities, waive any past Event of Default in respect of the Capital Securities
and its consequences, provided that, if the underlying Event of Default under
the Indenture:
(i) is not waivable under the Indenture, the Event of
Default under the Declaration shall also not be waivable; or
(ii) requires the consent or vote of greater than a
majority in aggregate principal amount of the holders of the Debentures
(a "Super Majority") to be waived under the Indenture, the Event of
Default under the Declaration may only be waived by the vote of the
Holders of at least the proportion in aggregate liquidation amount of
the Capital Securities that the relevant Super Majority represents of
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the aggregate principal amount of the Debentures outstanding.
The foregoing provisions of this Section 2.6(a) shall be in lieu of Section
316(a)(1)(B) of the Trust Indenture Act and such Section 316(a)(1)(B) of the
Trust Indenture Act is hereby expressly excluded from this Declaration and the
Securities, as permitted by the Trust Indenture Act. Upon such waiver, any such
default shall cease to exist, and any Event of Default with respect to the
Capital Securities arising therefrom shall be deemed to have been cured, for
every purpose of this Declaration, but no such waiver shall extend to any
subsequent or other default or an Event of Default with respect to the Capital
Securities or impair any right consequent thereon. Any waiver by the Holders of
the Capital Securities of an Event of Default with respect to the Capital
Securities shall also be deemed to constitute a waiver by the Holders of the
Common Securities of any such Event of Default with respect to the Common
Securities for all purposes of this Declaration without any further act, vote,
or consent of the Holders of the Common Securities.
The Holders of a Majority in liquidation amount of the Capital
Securities shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Property Trustee or to
direct the exercise of any trust or power conferred upon the Property Trustee,
including the right to direct the Property Trustee to exercise the remedies
available to it as holder of the Debentures; provided, however, that (subject to
the provisions of Section 3.9) the Property Trustee shall have the right to
decline to follow any such direction if the Property Trustee shall determine
that the action so directed would be unjustly prejudicial to the Holders not
taking part in such direction or if the Property Trustee, being advised by
counsel, determines that the action or proceeding so directed may not lawfully
be taken or if the Property Trustee, in good faith, by its board of directors or
trustees, executive committee, or a trust committee of directors or trustees
and/or Responsible Officers, shall determine that the action or proceedings so
directed would involve the Property Trustee in personal liability.
(b) The Holders of a Majority in liquidation amount of the
Common Securities may, by vote, on behalf of the Holders of all of the Common
Securities, waive any past Event of Default with respect to the Common
Securities and its consequences,
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provided that, if the underlying Event of Default under the Indenture:
(i) is not waivable under the Indenture, except where the
Holders of the Common Securities are deemed to have waived such Event
of Default under the Declaration as provided below in this Section
2.6(b), the Event of Default under the Declaration shall also not be
waivable; or
(ii) requires the consent or vote of a Super Majority to
be waived, except where the Holders of the Common Securities are deemed
to have waived such Event of Default under the Declaration as provided
below in this Section 2.6(b), the Event of Default under the
Declaration may only be waived by the vote of the Holders of at least
the proportion in aggregate liquidation amount of the Common Securities
that the relevant Super Majority represents of the aggregate principal
amount of the Debentures outstanding;
provided further, each Holder of Common Securities will be deemed to have waived
any such Event of Default and all Events of Default with respect to the Common
Securities and its consequences if all Events of Default with respect to the
Capital Securities have been cured, waived or otherwise eliminated, and until
such Events of Default have been so cured, waived or otherwise eliminated, the
Property Trustee will be deemed to be acting solely on behalf of the Holders of
the Capital Securities and only the Holders of the Capital Securities will have
the right to direct the Property Trustee in accordance with the terms of the
Securities. The foregoing provisions of this Section 2.6(b) shall be in lieu of
Sections 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act and such
Sections 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act are hereby
expressly excluded from this Declaration and the Securities, as permitted by the
Trust Indenture Act. Subject to the foregoing provisions of this Section 2.6(b),
upon such waiver, any such default shall cease to exist and any Event of Default
with respect to the Common Securities arising therefrom shall be deemed to have
been cured for every purpose of this Declaration, but no such waiver shall
extend to any subsequent or other default or Event of Default with respect to
the Common Securities or impair any right consequent thereon.
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(c) A waiver of an Event of Default under the Indenture
by the Property Trustee, at the direction of the Holders of the Capital
Securities, constitutes a waiver of the corresponding Event of Default under
this Declaration. The foregoing provisions of this Section 2.6(c) shall be in
lieu of Section 316(a)(1)(B) of the Trust Indenture Act and such Section
316(a)(1)(B) of the Trust Indenture Act is hereby expressly excluded from this
Declaration and the Securities, as permitted by the Trust Indenture Act.
SECTION 2.7 Event of Default; Notice.
(a) The Property Trustee shall, within 90 days after the
occurrence of an Event of Default, transmit by mail, first class postage
prepaid, to the Holders written notice of all defaults with respect to the
Securities actually known to a Responsible Officer of the Property Trustee,
unless such defaults have been cured before the giving of such notice; provided
that, except for a default in the payment of principal of (or premium, if any)
or interest on any of the Capital Securities or the Debentures, the Property
Trustee shall be protected in withholding such notice if and so long as a
Responsible Officer of the Property Trustee in good faith determines that the
withholding of such notice is in the interests of the Holders.
(b) The Property Trustee shall not be deemed to have
knowledge of any default except:
(i) a default under subparagraph (b) or (c) of the
definition "Event of Default" in this Declaration;
(ii) a default under Sections 5.01(a) and 5.01(b) of the
Indenture; or
(iii) any default as to which the Property Trustee shall
have received written notice or of which a Responsible Officer of the
Property Trustee charged with the administration of the Declaration
shall have actual knowledge.
(c) Within ten Business Days after the occurrence of any
Event of Default actually known to the Property Trustee, the Property Trustee
shall transmit notice of such Event of Default to the holders of the Capital
Securities, the Administrative Trustees and the Sponsor, unless such Event of
Default shall have
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been cured or waived. The Sponsor and the Administrative Trustees shall file
annually with the Property Trustee a certification as to whether or not they are
in compliance with all the conditions and covenants applicable to them under
this Declaration.
ARTICLE III
ORGANIZATION
SECTION 3.1 Name.
The Trust is named "AGL Capital Trust" as such name may be
modified from time to time by the Administrative Trustees following written
notice to the Holders of Securities. The Trust's activities may be conducted
under the name of the Trust or any other name deemed advisable by the
Administrative Trustees.
SECTION 3.2 Office.
The address of the principal office of the Trust is c/o AGL
Resources Inc., 303 Peachtree Street, N.E., Atlanta, Georgia 30308. On ten
Business Days written notice to the Holders of Securities, the Administrative
Trustees may designate another principal office.
SECTION 3.3 Purpose.
The exclusive purposes and functions of the Trust are (a) to
issue and sell Securities, (b) use the proceeds from the sale of the Securities
to acquire the Debentures, and (c) except as otherwise limited herein, to engage
in only those other activities necessary, advisable or incidental thereto. The
Trust shall not borrow money, issue debt or reinvest proceeds derived from
investments, mortgage or pledge any of its assets, or otherwise undertake (or
permit to be undertaken) any activity that would cause the Trust not to be
classified for United States federal income tax purposes as a grantor trust.
SECTION 3.4 Authority.
Subject to the limitations provided in this Declaration and to
the specific duties of the Property Trustee, the Administrative Trustees shall
have exclusive and complete
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authority to carry out the purposes of the Trust. An action taken by the
Administrative Trustees in accordance with their powers shall constitute the act
of and serve to bind the Trust and an action taken by the Property Trustee on
behalf of the Trust in accordance with its powers shall constitute the act of
and serve to bind the Trust. However, from and including the date of the
Original Declaration until and including the date of this Declaration, the
Sponsor shall have complete authority to carry out the purposes of this Trust in
addition to any other specific duties of or authority provided the Sponsor in
this Declaration, and any actions taken by the Sponsor during such time on
behalf of the Trust shall constitute the act of and serve to bind the Trust. In
dealing with the Trustees acting on behalf of the Trust, no person shall be
required to inquire into the authority of the Trustees, or the Sponsor, as
provided in this Section, to bind the Trust. Persons dealing with the Trust are
entitled to rely conclusively on the power and authority of the Trustees and the
Sponsor, as provided in this Section, as set forth in this Declaration.
SECTION 3.5 Title to Property of the Trust.
Except as provided in Section 3.8 with respect to the Debentures and
the Property Trustee Account or as otherwise provided in this Declaration,
legal title to all assets of the Trust shall be vested in the Trust. The
Holders shall not have legal title to any part of the assets of the Trust, but
shall have an undivided beneficial interest in the assets of the Trust.
SECTION 3.6 Powers and Duties of the Administrative Trustees.
Except as provided in Section 3.4, the Administrative Trustees shall
have the exclusive power, duty and authority to cause the Trust to engage in
the following activities:
(a) to issue and sell the Securities in accordance with this
Declaration; provided, however, that except as contemplated in Section 7.1(a),
(i) the Trust may issue no more than one series of Capital Securities and no
more than one series of Common Securities, (ii) there shall be no interests in
the Trust other than the Securities, and (iii) the issuance of Securities shall
be limited to a simultaneous issuance of both Capital Securities and Common
Securities at any Closing Time,
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(b) in connection with the issue and sale of the Capital
Securities and the consummation of the Exchange Offer, at the direction of the
Sponsor, to:
(i) prepare and execute, if necessary, an offering
memorandum (the "Offering Memorandum") in preliminary and final form
prepared by the Sponsor, in relation to the offering and sale of Series
A Capital Securities to qualified institutional buyers in reliance on
Rule 144A under the Securities Act and to institutional "accredited
investors" (as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation
D under the Securities Act), and to execute and file with the
Commission, at such time as determined by the Sponsor, any Registration
Statement, including any amendments thereto, as contemplated by the
Registration Rights Agreement;
(ii) execute and file any documents prepared by the
Sponsor, or take any acts as determined by the Sponsor to be necessary
in order to qualify or register all or part of the Capital Securities
in any State in which the Sponsor has determined to qualify or register
such Capital Securities for sale;
(iii) at the direction of the Sponsor, execute and file an
application, prepared by the Sponsor, to the New York Stock Exchange or
any other national stock exchange or the Nasdaq Stock Market's National
Market for listing or quotation of the Capital Securities;
(iv) to execute and deliver letters, documents, or
instruments with DTC and other Clearing Agencies relating to the
Capital Securities;
(v) if required, execute and file with the Commission a
registration statement on Form 8-A, including any amendments thereto,
prepared by the Sponsor, relating to the registration of the Capital
Securities under Section 12(b) of the Exchange Act; and
(vi) execute and enter into the Purchase Agreement and the
Registration Rights Agreement providing for the sale of the Capital
Securities;
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(c) to acquire the Series A Debentures with the proceeds of
the sale of the Series A Capital Securities and the Common Securities and to
exchange the Series A Debentures for a like principal amount of Series B
Debentures, pursuant to the Exchange Offer; provided, however, that the
Administrative Trustees shall cause legal title to the Debentures to be held of
record in the name of the Property Trustee for the benefit of the Holders;
(d) to give the Sponsor and the Property Trustee prompt
written notice of the occurrence of a Tax Event or an Investment Company Act
Event;
(e) to establish a record date with respect to all actions to
be taken hereunder that require a record date be established, including and with
respect to, for the purposes of ss.316(c) of the Trust Indenture Act,
Distributions, voting rights, redemptions and exchanges, and to issue relevant
notices to the Holders of Capital Securities and Holders of Common Securities as
to such actions and applicable record dates;
(f) to take all actions and perform such duties as may be
required of the Administrative Trustees pursuant to the terms of the Securities;
(g) to bring or defend, pay, collect, compromise, arbitrate,
resort to legal action, or otherwise adjust claims or demands of or against the
Trust ("Legal Action"), unless pursuant to Section 3.8(e), the Property Trustee
has the exclusive power to bring such Legal Action;
(h) to employ or otherwise engage employees and agents (who
may be designated as officers with titles) and managers, contractors, advisors,
and consultants and pay reasonable compensation for such services;
(i) to cause the Trust to comply with the Trust's obligations
under the Trust Indenture Act;
(j) to give the certificate required by Section 314(a)(4) of
the Trust Indenture Act to the Property Trustee, which certificate may be
executed by any Administrative Trustee;
(k) to incur expenses that are necessary or incidental to
carry out any of the purposes of the Trust;
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(l) to act as, or appoint another Person to act as,
Registrar and Exchange Agent for the Securities or to appoint a Paying
Agent for the Securities as provided in Section 7.4 except for such time as
such power to appoint a Paying Agent is vested in the Property Trustee;
(m) to give prompt written notice to the Property
Trustee and to Holders of any notice received from the Debenture Issuer of its
election to defer payments of interest on the Debentures by extending the
interest payment period under the Indenture;
(n) to execute all documents or instruments, perform all
duties and powers, and do all things for and on behalf of the Trust in all
matters necessary or incidental to the foregoing;
(o) to take all action that may be necessary or
appropriate for the preservation and the continuation of the Trust's valid
existence, rights, franchises and privileges as a statutory business trust
under the laws of the State of Delaware and of each other jurisdiction in which
such existence is necessary to protect the limited liability of the Holders of
the Capital Securities or to enable the Trust to effect the purposes for which
the Trust was created;
(p) to take any action, not inconsistent with this
Declaration or with applicable law, that the Administrative Trustees determine
in their discretion to be necessary or desirable in carrying out the activities
of the Trust as set out in this Section 3.6, including, but not limited to:
(i) causing the Trust not to be deemed to be an
Investment Company required to be registered under the Investment
Company Act;
(ii) causing the Trust to be classified for United States
federal income tax purposes as a grantor trust; and
(iii) cooperating with the Debenture Issuer to ensure that
the Debentures will be treated as indebtedness of the Debenture Issuer
for United States federal income tax purposes.
(q) to take all action necessary to consummate the
Exchange Offer or otherwise cause the Capital Securities to be
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registered pursuant to an effective registration statement in accordance with
the provisions of the Registration Rights Agreement.
(r) to take all action necessary to cause all applicable tax
returns and tax information reports that are required to be filed with respect
to the Trust to be duly prepared and filed by the Administrative Trustees, on
behalf of the Trust.
Any and all such actions heretofore taken by the Sponsor are
hereby ratified and confirmed.
The Administrative Trustees must exercise the powers set forth
in this Section 3.6 in a manner that is consistent with the purposes and
functions of the Trust set out in Section 3.3, and the Administrative Trustees
shall not take any action that is inconsistent with the purposes and functions
of the Trust set forth in Section 3.3.
Subject to this Section 3.6, the Administrative Trustees shall
have none of the powers or the authority of the Property Trustee set forth in
Section 3.8.
Any expenses incurred by the Administrative Trustees pursuant
to this Section 3.6 shall be reimbursed by the Debenture Issuer.
SECTION 3.7 Prohibition of Actions by the Trust and the Trustees.
(a) The Trust shall not, and the Trustees (including the
Property Trustee) shall not, engage in any activity other than as required or
authorized by this Declaration. The Trust shall not:
(i) invest any proceeds received by the Trust from
holding the Debentures, but shall distribute all such proceeds to
Holders pursuant to the terms of this Declaration and of the
Securities;
(ii) acquire any assets other than as expressly provided
herein;
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(iii) possess Trust property for other than a Trust
purpose;
(iv) make any loans or incur any indebtedness other than
loans represented by the Debentures;
(v) possess any power or otherwise act in such a way as
to vary the Trust assets or the terms of the Securities in any way
whatsoever;
(vi) issue any securities or other evidences of beneficial
ownership of, or beneficial interest in, the Trust other than the
Securities; or
(vii) other than as provided in this Declaration or Annex
I, (A) direct the time, method and place of conducting any proceeding
with respect to any remedy available to the Debenture Trustee, or
exercising any trust or power conferred upon the Debenture Trustee with
respect to the Debentures, (B) waive any past default that is waivable
under the Indenture, (C) exercise any right to rescind or annul any
declaration that the principal of all the Debentures shall be due and
payable, or (D) consent to any amendment, modification or termination
of the Indenture or the Debentures where such consent shall be required
unless the Trust shall have received an opinion of a nationally
recognized independent tax counsel experienced in such matters to the
effect that such modification will not cause more than an insubstantial
risk that for United States federal income tax purposes the Trust will
not be classified as a grantor trust.
SECTION 3.8 Powers and Duties of the Property Trustee.
(a) The legal title to the Debentures shall be owned by
and held of record in the name of the Property Trustee in trust for the
benefit of the Holders. The right, title and interest of the Property Trustee
to the Debentures shall vest automatically in each Person who may hereafter be
appointed as Property Trustee in accordance with Section 5.7. Such vesting and
cessation of title shall be effective whether or not conveyancing documents
with regard to the Debentures have been executed and delivered.
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(b) The Property Trustee shall not transfer its right,
title and interest in the Debentures to the Administrative Trustees or to the
Delaware Trustee (if the Property Trustee does not also act as Delaware
Trustee).
(c) The Property Trustee shall:
(i) establish and maintain a segregated non-interest
bearing trust account (the "Property Trustee Account") in the name of
and under the exclusive control of the Property Trustee on behalf of
the Holders and, upon the receipt of payments of funds made in respect
of the Debentures held by the Property Trustee, deposit such funds into
the Property Trustee Account and make payments to the Holders of the
Capital Securities and Holders of the Common Securities from the
Property Trustee Account in accordance with Section 6.1. Funds in the
Property Trustee Account shall be held uninvested until disbursed in
accordance with this Declaration. The Property Trustee Account shall be
an account that is maintained with a banking institution the rating on
whose long-term unsecured indebtedness is at least equal to the rating
assigned to the Capital Securities by a "nationally recognized
statistical rating organization", as that term is defined for purposes
of Rule 436(g)(2) under the Securities Act;
(ii) engage in such ministerial activities as shall be
necessary or appropriate to effect the redemption of the Common
Securities to the extent the Debentures are redeemed or mature; and
(iii) upon written notice of distribution issued by the
Administrative Trustees in accordance with the terms of the Securities,
engage in such ministerial activities as shall be necessary or
appropriate to effect the distribution of the Debentures to Holders of
Securities upon the occurrence of certain events.
(d) The Property Trustee shall take all actions and
perform such duties as may be specifically required of the Property Trustee
pursuant to the terms of the Securities.
(e) Subject to Section 3.9(a), the Property Trustee
shall take any Legal Action which arises out of or in connection with an Event
of Default of which a Responsible Officer of the
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Property Trustee has actual knowledge or the Property Trustee's duties and
obligations under this Declaration or the Trust Indenture Act and if such
Property Trustee shall have failed to take such Legal Action, the Holders of the
Capital Securities may take such Legal Action, to the same extent as if such
Holders of Capital Securities held an aggregate principal amount of Debentures
equal to the aggregate liquidation amount of such Capital Securities, without
first proceeding against the Property Trustee or the Trust; provided however,
that if an Event of Default has occurred and is continuing and such event is
attributable to the failure of the Debenture Issuer to pay the principal of or
premium, if any, or interest on the Debentures on the date such principal,
premium, if any, or interest is otherwise payable (or in the case of redemption,
on the redemption date), then a Holder of Capital Securities may directly
institute a proceeding for enforcement of payment to such Holder of the
principal of or premium, if any, or interest on the Debentures having a
principal amount equal to the aggregate liquidation amount of the Capital
Securities of such Holder (a "Direct Action") on or after the respective due
date specified in the Debentures. In connection with such Direct Action, the
rights of the Holders of the Common Securities will be subrogated to the rights
of such Holder of Capital Securities to the extent of any payment made by the
Debenture Issuer to such Holder of Capital Securities in such Direct Action.
Except as provided in the preceding sentences, the Holders of Capital Securities
will not be able to exercise directly any other remedy available to the holders
of the Debentures.
(f) The Property Trustee shall continue to serve as a
Trustee until either:
(i) the Trust has been completely liquidated and the
proceeds of the liquidation distributed to the Holders pursuant to the
terms of the Securities; or
(ii) a successor Property Trustee has been appointed and
has accepted that appointment in accordance with Section 5.7 (a
"Successor Property Trustee").
(g) The Property Trustee shall have the legal power to
exercise all of the rights, powers and privileges of a holder of Debentures
under the Indenture and, if an Event of Default under the Indenture actually
known to a Responsible Officer of the Property Trustee occurs and is continuing,
the Property
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Trustee shall, for the benefit of Holders, enforce its rights as holder of the
Debentures subject to the rights of the Holders pursuant to the terms of such
Securities.
(h) The Property Trustee shall be authorized to undertake any
actions set forth in Section 317(a) of the Trust Indenture Act.
(i) For such time as the Property Trustee is the Paying Agent,
the Property Trustee may authorize one or more Persons to act as additional
Paying Agents and to pay Distributions, redemption payments or liquidation
payments on behalf of the Trust with respect to all securities and any such
Paying Agent shall comply with Section 317(b) of the Trust Indenture Act. Any
such additional Paying Agent may be removed by the Property Trustee at any time
the Property Trustee remains as Paying Agent and a successor Paying Agent or
additional Paying Agents may be (but are not required to be) appointed at any
time by the Property Trustee while the Property Trustee is so acting as Paying
Agent.
(j) Subject to this Section 3.8, the Property Trustee shall
have none of the duties, liabilities, powers or the authority of the
Administrative Trustees set forth in Section 3.6.
The Property Trustee must exercise the powers set forth in
this Section 3.8 in a manner that is consistent with the purposes and functions
of the Trust set out in Section 3.3, and the Property Trustee shall not take any
action that is inconsistent with the purposes and functions of the Trust set out
in Section 3.3.
SECTION 3.9 Certain Duties and Responsibilities of the Property
Trustee.
(a) The Property Trustee, before the occurrence of any Event
of Default and after the curing of all Trust Events of Default that may have
occurred, shall undertake to perform only such duties as are specifically set
forth in this Declaration and in the Securities and no implied covenants shall
be read into this Declaration against the Property Trustee. In case an Event of
Default has occurred (that has not been cured or waived pursuant to Section 2.6)
of which a Responsible Officer of the Property Trustee has actual knowledge, the
Property Trustee shall
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exercise such of the rights and powers vested in it by this Declaration, and use
the same degree of care and skill in their exercise, as a prudent person would
exercise or use under the circumstances in the conduct of his or her own
affairs.
(b) No provision of this Declaration shall be construed
to relieve the Property Trustee from liability for its own negligent action, its
own negligent failure to act, or its own willful misconduct, except that:
(i) prior to the occurrence of an Event of Default and
after the curing or waiving of all such Events of Default that may have
occurred:
(A) the duties and obligations of the Property
Trustee shall be determined solely by the express provisions
of this Declaration and in the Securities and the Property
Trustee shall not be liable except for the performance of such
duties and obligations as are specifically set forth in this
Declaration and in the Securities, and no implied covenants or
obligations shall be read into this Declaration or the
Securities against the Property Trustee; and
(B) in the absence of bad faith on the part of the
Property Trustee, the Property Trustee may conclusively rely,
as to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions
furnished to the Property Trustee and conforming to the
requirements of this Declaration; provided, however, that in
the case of any such certificates or opinions that by any
provision hereof are specifically required to be furnished to
the Property Trustee, the Property Trustee shall be under a
duty to examine the same to determine whether or not they
conform to the requirements of this Declaration;
(ii) the Property Trustee shall not be liable for any
error of judgment made in good faith by a Responsible Officer of the
Property Trustee, unless it shall be proved that the Property Trustee
was negligent in ascertaining the pertinent facts;
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(iii) the Property Trustee shall not be liable with respect
to any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of not less than a
Majority in liquidation amount of the Capital Securities relating to
the time, method and place of conducting any proceeding for any remedy
available to the Property Trustee, or exercising any trust or power
conferred upon the Property Trustee under this Declaration;
(iv) no provision of this Declaration shall require the
Property Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its duties or
in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that the repayment of such funds or
liability is not reasonably assured to it under the terms of this
Declaration or indemnity reasonably satisfactory to the Property
Trustee against such risk or liability is not reasonably assured to it;
(v) the Property Trustee's sole duty with respect to the
custody, safe keeping and physical preservation of the Debentures and
the Property Trustee Account shall be to deal with such property in a
similar manner as the Property Trustee deals with similar property for
its own account, subject to the protections and limitations on
liability afforded to the Property Trustee under this Declaration and
the Trust Indenture Act;
(vi) the Property Trustee shall have no duty or liability
for or with respect to the value, genuineness, existence or sufficiency
of the Debentures or the payment of any taxes or assessments levied
thereon or in connection therewith;
(vii) the Property Trustee shall not be liable for any
interest on any money received by it except as it may otherwise agree
in writing with the Sponsor. Money held by the Property Trustee need
not be segregated from other funds held by it except in relation to the
Property Trustee Account maintained by the Property Trustee pursuant to
Section 3.8(c)(i) and except to the extent otherwise required by law;
and
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(viii) the Property Trustee shall not be responsible for
monitoring the compliance by the Administrative Trustees or the Sponsor
with their respective duties under this Declaration, nor shall the
Property Trustee be liable for any default or misconduct of the
Administrative Trustees or the Sponsor.
SECTION 3.10 Certain Rights of Property Trustee.
(a) Subject to the provisions of Section 3.9:
(i) the Property Trustee may conclusively rely and shall
be fully protected in acting or refraining from acting upon any
resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document believed by
it to be genuine and to have been signed, sent or presented by the
proper party or parties;
(ii) any direction or act of the Sponsor or the
Administrative Trustees contemplated by this Declaration may be
sufficiently evidenced by an Officers' Certificate;
(iii) whenever in the administration of this Declaration,
the Property Trustee shall deem it desirable that a matter be proved or
established before taking, suffering or omitting any action hereunder,
the Property Trustee (unless other evidence is herein specifically
prescribed) may, in the absence of bad faith on its part, request and
conclusively rely upon an Officers' Certificate which, upon receipt of
such request, shall be promptly delivered by the Sponsor or the
Administrative Trustees;
(iv) the Property Trustee shall have no duty to see to any
recording, filing or registration of any instrument (including any
financing or continuation statement or any filing under tax or
securities laws) or any rerecording, refiling or registration thereof;
(v) the Property Trustee may consult with counsel or
other experts of its selection and the advice or opinion of such
counsel and experts with respect to legal matters or advice within the
scope of such experts' area of expertise shall be full and complete
authorization and protection in
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respect of any action taken, suffered or omitted by it hereunder in
good faith and in accordance with such advice or opinion, such counsel
may be counsel to the Sponsor or any of its Affiliates, and may include
any of its employees. The Property Trustee shall have the right at any
time to seek instructions concerning the administration of this
Declaration from any court of competent jurisdiction;
(vi) the Property Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Declaration
at the request or direction of any Holder, unless such Holder shall
have provided to the Property Trustee security and indemnity,
reasonably satisfactory to the Property Trustee, against the costs,
expenses (including reasonable attorneys' fees and expenses and the
expenses of the Property Trustee's agents, nominees or custodians) and
liabilities that might be incurred by it in complying with such request
or direction, including such reasonable advances as may be requested by
the Property Trustee provided, that, nothing contained in this Section
3.10(a)(vi) shall be taken to relieve the Property Trustee, upon the
occurrence of an Event of Default, of its obligation to exercise the
rights and powers vested in it by this Declaration;
(vii) the Property Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Property Trustee, in
its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit;
(viii) the Property Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by
or through agents, custodians, nominees or attorneys and the Property
Trustee shall not be responsible for any misconduct or negligence on
the part of any agent or attorney appointed with due care by it
hereunder;
(ix) any action taken by the Property Trustee or its
agents hereunder shall bind the Trust and the Holders of the
Securities, and the signature of the Property Trustee or its
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agents alone shall be sufficient and effective to perform any such
action and no third party shall be required to inquire as to the
authority of the Property Trustee to so act or as to its compliance
with any of the terms and provisions of this Declaration, both of which
shall be conclusively evidenced by the Property Trustee's or its
agent's taking such action;
(x) whenever in the administration of this Declaration
the Property Trustee shall deem it desirable to receive instructions
with respect to enforcing any remedy or right or taking any other
action hereunder, the Property Trustee (i) may request instructions
from the Holders which instructions may only be given by the Holders of
the same proportion in liquidation amount of the Securities as would be
entitled to direct the Property Trustee under the terms of the
Securities in respect of such remedy, right or action, (ii) may refrain
from enforcing such remedy or right or taking such other action until
such instructions are received, and (iii) shall be protected in
conclusively relying on or acting in or accordance with such
instructions;
(xi) except as otherwise expressly provided by this
Declaration, the Property Trustee shall not be under any obligation to
take any action that is discretionary under the provisions of this
Declaration; and
(xii) the Property Trustee shall not be liable for any
action taken, suffered, or omitted to be taken by it in good faith,
without negligence, and reasonably believed by it to be authorized or
within the discretion or rights or powers conferred upon it by this
Declaration.
(b) No provision of this Declaration shall be deemed to
impose any duty or obligation on the Property Trustee to perform any act or
acts or exercise any right, power, duty or obligation conferred or imposed on
it, in any jurisdiction in which it shall be illegal, or in which the Property
Trustee shall be unqualified or incompetent in accordance with applicable law,
to perform any such act or acts, or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Property Trustee
shall be construed to be a duty.
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SECTION 3.11 Delaware Trustee.
Notwithstanding any other provision of this Declaration other
than Section 5.2, the Delaware Trustee shall not be entitled to exercise any
powers, nor shall the Delaware Trustee have any of the duties and
responsibilities of the Administrative Trustees or the Property Trustee
described in this Declaration. Except as set forth in Section 5.2, the Delaware
Trustee shall be a Trustee for the sole and limited purpose of fulfilling the
requirements of ss.3807 of the Business Trust Act.
SECTION 3.12 Execution of Documents.
Each Administrative Trustee is authorized to execute on behalf
of the Trust any documents that the Administrative Trustees have the power and
authority to execute pursuant to Section 3.6; provided that, the registration
statement referred to in Section 3.6(b)(i), including any amendments thereto,
shall be signed by at least a majority of the Administrative Trustees. In
addition, from and including the date of the Original Declaration until and
including the date of this Declaration, the Sponsor is authorized to execute on
behalf of the Trust any documents that the Sponsor has the power and authority
to execute pursuant to Section 3.4.
SECTION 3.13 Not Responsible for Recitals or Issuance of
Securities.
The recitals contained in this Declaration and the Securities
shall be taken as the statements of the Sponsor, and the Trustees do not assume
any responsibility for their correctness. The Trustees make no representations
as to the value or condition of the property of the Trust or any part thereof.
The Trustees make no representations as to the validity or sufficiency of this
Declaration or the Securities.
SECTION 3.14 Duration of Trust.
The Trust, unless terminated pursuant to the provisions of
Article VIII hereof, shall have existence up to June 1, 2037.
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SECTION 3.15 Mergers.
(a) The Trust may not merge with or into, consolidate,
amalgamate, or be replaced by, or convey, transfer or lease its properties and
assets substantially as an entirety to any Person, except as described in
Section 3.15(b) and (c).
(b) The Trust may, at the request of the Sponsor, with
the consent of the Administrative Trustees or, if there are more than two, a
majority of the Administrative Trustees and without the consent of the Holders,
the Delaware Trustee or the Property Trustee, merge with or into, consolidate,
amalgamate, or be replaced by, or convey, transfer or lease its properties and
assets as an entirety or substantially as an entirety to, a trust organized as
such under the laws of any State; provided that:
(i) such successor entity (the "Successor Entity")
either:
(A) expressly assumes all of the obligations of the
Trust under the Securities; or
(B) substitutes for the Securities other securities
having substantially the same terms as the Securities (the
"Successor Securities" and the securities substituted for the
Capital Securities, the "Substitute Capital Securities") so
long as the Successor Securities rank the same as the
Securities rank with respect to Distributions and payments
upon liquidation, redemption and otherwise;
(ii) the Sponsor expressly appoints a trustee of the
Successor Entity that possesses the same powers and duties as the
Property Trustee as the Holder of the Debentures;
(iii) the Successor Capital Securities are listed, or any
Successor Securities will be listed upon notification of issuance, on
any national securities exchange or with another organization on which
the Capital Securities are then listed or quoted;
(iv) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not cause the Capital
Securities (including any Successor Capital
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Securities) to be downgraded by any nationally recognized statistical
rating organization;
(v) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely affect
the rights, preferences and privileges of the Holders (including any
Successor Securities) in any material respect (other than with respect
to any dilution of such Holders' interests in the new entity);
(vi) such Successor Entity has a purpose substantially
identical to that of the Trust;
(vii) prior to such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, the Sponsor has received an
opinion of an independent counsel to the Trust experienced in such
matters to the effect that:
(A) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely
affect the rights, preferences and privileges of the Holders
(including any Successor Securities) in any material; and
(B) following such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease,
neither the Trust nor the Successor Entity will be required to
register as an Investment Company; and
(viii) the Sponsor or any permitted successor or assignee
owns all of the common securities of such Successor Entity and
guarantees the obligations of such Successor Entity under the Successor
Securities at least to the extent provided by the Capital Securities
Guarantee and the Common Securities Guarantee.
(c) Notwithstanding Section 3.15(b), the Trust shall not,
except with the consent of Holders of 100% in liquidation amount of the
Securities, consolidate, amalgamate, merge with or into, or be replaced by, or
convey, transfer or lease its properties and assets as an entirety or
substantially as an entirety to, any other entity or permit any other entity to
consolidate, amalgamate, merge with or into, or replace it if such
consolidation, amalgamation, merger, replacement,
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conveyance, transfer or lease would cause the Trust or the Successor Entity not
to be classified as a grantor trust for United States federal income tax
purposes.
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities.
At the Closing Time, the Sponsor will purchase all of the
Common Securities then issued by the Trust, in an amount at least equal to 3% of
the capital of the Trust, at the same time as the Series A Capital Securities
are issued and sold.
SECTION 4.2 Responsibilities of the Sponsor.
In connection with the issue and sale of the Capital
Securities, the Sponsor shall have the exclusive right and responsibility to
engage in the following activities:
(a) to prepare the Offering Memorandum and to prepare for
filing by the Trust with the Commission any Registration Statement, including
any amendments thereto as contemplated by the Registration Rights Agreement;
(b) to determine the States in which to take appropriate
action to qualify or register for sale all or part of the Capital Securities and
to do any and all such acts, other than actions which must be taken by the
Trust, and advise the Trust of actions it must take, and prepare for execution
and filing any documents to be executed and filed by the Trust, as the Sponsor
deems necessary or advisable in order to comply with the applicable laws of any
such States;
(c) if deemed necessary or advisable by the Sponsor, to
prepare for filing by the Trust an application to the New York Stock Exchange or
any other national stock exchange or the Nasdaq National Market for listing or
quotation of the Capital Securities;
(d) to prepare for filing by the Trust with the Commission a
registration statement on Form 8-A relating to the registration of the Capital
Securities under Section 12(b) of the Exchange Act, including any amendments
thereto;
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(e) to negotiate the terms of the Purchase Agreement and the
Registration Rights Agreement providing for the sale of the Capital Securities;
and
(f) to execute and deliver to the depository of the Capital
Securities such certificates and authorizations requested or required thereby
and the prior acts of the Sponsor and the Delaware Trustee with respect thereto
are ratified and approved in all respects.
SECTION 4.3 Right to Proceed.
The Sponsor acknowledges the rights of the Holders of Capital
Securities, in the event that a failure of the Trust to pay Distributions on the
Capital Securities is attributable to the failure of the Debenture Issuer to pay
interest or principal on the Debentures, to institute a proceeding directly
against the Debenture Issuer for enforcement of its payment obligations on the
Debentures.
ARTICLE V
TRUSTEES
SECTION 5.1 Number of Trustees: Appointment of Co-Trustee.
The number of Trustees initially shall be five (5), and:
(a) at any time before the issuance of any Securities, the
Sponsor may, by written instrument, increase or decrease the number of Trustees;
and
(b) after the issuance of any Securities, the number of
Trustees may be increased or decreased by vote of the Holders of a majority in
liquidation amount of the Common Securities voting as a class at a meeting of
the Holders of the Common Securities;
provided, however, that, the number of Trustees shall in no event be less than
two (2); provided further that (1) one Trustee, in the case of a natural person,
shall be a person who is a resident of the State of Delaware or that, if not a
natural person, is an entity which has its principal place of business in the
State of Delaware (the "Delaware Trustee"); (2) there shall be at least
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one Trustee who is an employee or officer of, or is affiliated with the Sponsor
(an "Administrative Trustee"); and (3) one Trustee shall be the Property Trustee
for so long as this Declaration is required to qualify as an indenture under the
Trust Indenture Act or this Declaration is otherwise deemed to be subject to the
Trust Indenture Act, and such Trustee may also serve as Delaware Trustee if it
meets the applicable requirements. Notwithstanding the above, unless an Event of
Default shall have occurred and be continuing, at any time or times, for the
purpose of meeting the legal requirements of the Trust Indenture Act or of any
jurisdiction in which any part of the Trust's property may at the time be
located, the Holders of a Majority in liquidation amount of the Common
Securities acting as a class at a meeting of the Holders of the Common
Securities, and the Administrative Trustees shall have power to appoint one or
more persons either to act as a co-trustee, jointly with the Property Trustee,
of all or any part of the Trust's property, or to act as separate trustee of any
such property, in either case with such powers as may be provided in the
instrument of appointment, and to vest in such person or persons in such
capacity any property, title, right or power deemed necessary or desirable,
subject to the provisions of this Declaration. In case an Event of Default has
occurred and is continuing, the Property Trustee alone shall have power to make
any such appointment of a co-trustee.
SECTION 5.2 Delaware Trustee.
If required by the Business Trust Act, one Trustee (the
"Delaware Trustee") shall be:
(a) a natural person who is a resident of the State of
Delaware; or
(b) if not a natural person, an entity which has its principal
place of business in the State of Delaware, and otherwise meets the requirements
of applicable law,
provided that, if the Property Trustee has its principal place of business in
the State of Delaware and otherwise meets the requirements of applicable law,
then the Property Trustee shall also be the Delaware Trustee and Section 3.11
shall have no application.
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SECTION 5.3 Property Trustee; Eligibility.
(a) There shall at all times be one Trustee (the "Property
Trustee") which shall act as Property Trustee which shall:
(i) not be an Affiliate of the Sponsor; and
(ii) be a corporation organized and doing business under
the laws of the United States of America or any State or Territory
thereof or of the District of Columbia, or a corporation or Person
permitted by the Commission to act as an institutional trustee under
the Trust Indenture Act, authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at
least 50 million U.S. dollars ($50,000,000), and subject to supervision
or examination by Federal, State, Territorial or District of Columbia
authority. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of the supervising or
examining authority referred to above, then for the purposes of this
Section 5.3(a)(ii), the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published.
(b) If at any time the Property Trustee shall cease to be
eligible to so act under Section 5.3(a), the Property Trustee shall immediately
resign in the manner and with the effect set forth in Section 5.7(c).
(c) If the Property Trustee has or shall acquire any
"conflicting interest" within the meaning of Section 310(b) of the Trust
Indenture Act, the Property Trustee and the Holder of the Common Securities (as
if it were the obligor referred to in Section 310(b) of the Trust Indenture Act)
shall in all respects comply with the provisions of Section 310(b) of the Trust
Indenture Act.
(d) The Capital Securities Guarantee shall be deemed to be
specifically described in this Declaration for purposes of clause (i) of the
first provision contained in Section 310(b) of the Trust Indenture Act.
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(e) The initial Property Trustee shall be:
The Bank of New York
101 Barclay Street, 21 West
New York, New York 10286
Attention: Corporate Trust Trustee
Administration
SECTION 5.4 Certain Qualifications of Administrative Trustees and
Delaware Trustee Generally.
Each Administrative Trustee and the Delaware Trustee (unless
the Property Trustee also acts as Delaware Trustee) shall be either a natural
person who is at least 21 years of age or a legal entity that shall act through
one or more Authorized Officers.
SECTION 5.5 Administrative Trustees.
The initial Administrative Trustees shall be:
David R. Jones
Charles W. Bass
J. Michael Riley
(a) Except as expressly set forth in this Declaration and
except if a meeting of the Administrative Trustees is called with respect to any
matter over which the Administrative Trustees have power to act, any power of
the Administrative Trustees may be exercised by, or with the consent of, any one
such Administrative Trustee.
(b) Unless otherwise determined by the Administrative
Trustees, and except as otherwise required by the Business Trust Act or
applicable law, any Administrative Trustee is authorized to execute on behalf of
the Trust any documents which the Administrative Trustees have the power and
authority to cause the Trust to execute pursuant to Section 3.6, provided, that,
the registration statement referred to in Section 3.6, including any amendments
thereto, shall be signed by a majority of the Administrative Trustees; and
(c) An Administrative Trustee may, by power of attorney
consistent with applicable law, delegate to any other natural person over the
age of 21 his or her power for the
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purposes of signing any documents which the Administrative Trustees have power
and authority to cause the Trust to execute pursuant to Section 3.6.
SECTION 5.6 Delaware Trustee.
The initial Delaware Trustee shall be:
The Bank of New York (Delaware)
White Clay Center, Route 273
Newark, Delaware 19711
SECTION 5.7 Appointment, Removal and Resignation of Trustees.
(a) Subject to Section 5.7(b) of this Declaration and to
Section 6(b) of Annex I hereto, Trustees may be appointed or removed without
cause at any time:
(i) until the issuance of any Securities, by written
instrument executed by the Sponsor;
(ii) unless an Event of Default shall have occurred and be
continuing after the issuance of any Securities, by vote of the Holders
of a Majority in liquidation amount of the Common Securities voting as
a class at a meeting of the Holders of the Common Securities; and
(iii) if an Event of Default shall have occurred and be
continuing after the issuance of the Securities, with respect to the
Property Trustee or the Delaware Trustee, by vote of Holders of a
Majority in liquidation amount of the Capital Securities voting as a
class at a meeting of Holders of the Capital Securities.
(b) (i) The Trustee that acts as Property Trustee shall not be
removed in accordance with Section 5.7(a) until a Successor Property Trustee has
been appointed and has accepted such appointment by written instrument executed
by such Successor Property Trustee and delivered to the Administrative Trustees
and the Sponsor; and
(ii) the Trustee that acts as Delaware Trustee shall not
be removed in accordance with this Section 5.7(a) until a successor
Trustee possessing the qualifications to act as
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Delaware Trustee under Sections 5.2 and 5.4 (a "Successor Delaware
Trustee") has been appointed and has accepted such appointment by
written instrument executed by such Successor Delaware Trustee and
delivered to the Administrative Trustees and the Sponsor.
(c) A Trustee appointed to office shall hold office
until his successor shall have been appointed or until his death, removal or
resignation. Any Trustee may resign from office (without need for prior or
subsequent accounting) by an instrument in writing signed by the Trustee and
delivered to the Sponsor and the Trust, which resignation shall take effect
upon such delivery or upon such later date as is specified therein; provided,
however, that:
(i) No such resignation of the Trustee that acts as the
Property Trustee shall be effective:
(A) until a Successor Property Trustee has been
appointed and has accepted such appointment by instrument
executed by such Successor Property Trustee and delivered to
the Trust, the Sponsor and the resigning Property Trustee; or
(B) until the assets of the Trust have been
completely liquidated and the proceeds thereof distributed to
the Holders of the Securities; and
(ii) no such resignation of the Trustee that acts as the
Delaware Trustee shall be effective until a Successor Delaware Trustee
has been appointed and has accepted such appointment by instrument
executed by such Successor Delaware Trustee and delivered to the Trust,
the Sponsor and the resigning Delaware Trustee.
(d) The Holders of the Common Securities shall use their
best efforts to promptly appoint a Successor Delaware Trustee or Successor
Property Trustee, as the case may be, if the Property Trustee or the Delaware
Trustee delivers an instrument of resignation in accordance with this Section
5.7.
(e) If no Successor Property Trustee or Successor
Delaware Trustee shall have been appointed and accepted appointment as provided
in this Section 5.7 within 60 days after delivery of an instrument of
resignation or removal, the Property
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Trustee or Delaware Trustee resigning or being removed, as applicable, may
petition any court of competent jurisdiction for appointment of a Successor
Property Trustee or Successor Delaware Trustee. Such court may thereupon, after
prescribing such notice, if any, as it may deem proper and prescribe, appoint a
Successor Property Trustee or Successor Delaware Trustee, as the case may be.
(f) No Property Trustee or Delaware Trustee shall be
liable for the acts or omissions to act of any Successor Property Trustee or
Successor Delaware Trustee, as the case may be.
SECTION 5.8 Vacancies among Trustees.
If a Trustee ceases to hold office for any reason and the
number of Trustees is not reduced pursuant to Section 5.1, or if the number of
Trustees is increased pursuant to Section 5.1, a vacancy shall occur. A
resolution certifying the existence of such vacancy by the Administrative
Trustees or, if there are more than two, a majority of the Administrative
Trustees shall be conclusive evidence of the existence of such vacancy. The
vacancy shall be filled with a Trustee appointed in accordance with Section 5.7.
SECTION 5.9 Effect of Vacancies.
The death, resignation, retirement, removal, bankruptcy,
dissolution, liquidation, incompetence or incapacity to perform the duties of a
Trustee shall not operate to dissolve, terminate or annul the Trust. Whenever a
vacancy in the number of Administrative Trustees shall occur, until such vacancy
is filled by the appointment of an Administrative Trustee in accordance with
Section 5.7, the Administrative Trustees in office, regardless of their number,
shall have all the powers granted to the Administrative Trustees and shall
discharge all the duties imposed upon the Administrative Trustees by this
Declaration.
SECTION 5.10 Meetings.
If there is more than one Administrative Trustee, meetings of
the Administrative Trustees shall be held from time to time upon the call of any
Administrative Trustee. Regular meetings of the Administrative Trustees may be
held at a time and place fixed by resolution of the Administrative Trustees.
Notice
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of any in-person meetings of the Administrative Trustees shall be hand delivered
or otherwise delivered in writing (including by facsimile, with a hard copy by
overnight courier) not less than 24 hours before such meeting. Notice of any
telephonic meetings of the Administrative Trustees or any committee thereof
shall be hand delivered or otherwise delivered in writing (including by
facsimile, with a hard copy by overnight courier) not less than 24 hours before
a meeting. Notices shall contain a brief statement of the time, place and
anticipated purposes of the meeting. The presence (whether in person or by
telephone) of an Administrative Trustee at a meeting shall constitute a waiver
of notice of such meeting except where an Administrative Trustee attends a
meeting for the express purpose of objecting to the transaction of any activity
on the ground that the meeting has not been lawfully called or convened. Unless
provided otherwise in this Declaration, any action of the Administrative
Trustees may be taken at a meeting by vote of a majority of the Administrative
Trustees present (whether in person or by telephone) and eligible to vote with
respect to such matter, provided that a Quorum is present, or without a meeting
by the unanimous written consent of the Administrative Trustees. In the event
there is only one Administrative Trustee, any and all action of such
Administrative Trustee shall be evidenced by a written consent of such
Administrative Trustee.
SECTION 5.11 Delegation of Power.
(a) Any Administrative Trustee may, by power of attorney
consistent with applicable law, delegate to any other natural person over the
age of 21 his or her power for the purpose of executing any documents
contemplated in Section 3.6, including any registration statement or amendment
thereto filed with the Commission, or making any other governmental filing; and
(b) the Administrative Trustees shall have power to delegate
from time to time to such of their number or to officers of the Trust the doing
of such things and the execution of such instruments either in the name of the
Trust or the names of the Administrative Trustees or otherwise as the
Administrative Trustees may deem expedient, to the extent such delegation is not
prohibited by applicable law or contrary to the provisions of the Trust, as set
forth herein.
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Section 5.12 Merger, Conversion, Consolidation or Succession to
Business.
Any corporation into which the Property Trustee or the Delaware Trustee
or any Administrative Trustee that is not a natural person, as the case may be,
may be merged or converted or with which it may be consolidated, or any
corporation resulting from any merger, conversion or consolidation to which the
Property Trustee, the Delaware Trustee or the Administrative Trustee, as the
case may be, shall be a party, or any corporation succeeding to all or
substantially all the corporate trust business of the Property Trustee or the
Delaware Trustee, as the case may be, shall be the successor of the Property
Trustee or the Delaware Trustee, as the case may be, hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto.
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions.
Holders shall receive Distributions in accordance with the applicable
terms of the relevant Holder's Securities. If and to the extent that the
Debenture Issuer makes a payment of interest (including Compounded
Interest (as defined in the Indenture) and Additional Interest (as defined in
the Indenture)), premium and/or principal on the Debentures held by the
Property Trustee or Liquidated Damages (as defined in the Registration Rights
Agreement) or any other payments pursuant to the Registration Rights Agreement
with respect to the Debentures held by the Property Trustee (the amount of any
such payment being a "Payment Amount"), the Property Trustee shall and is
directed, to the extent funds are available for that purpose, to make a
distribution (a "Distribution") of the Payment Amount to Holders.
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ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities.
(a) The Administrative Trustees shall on behalf of the Trust
issue one class of capital securities representing undivided beneficial
interests in the assets of the Trust having such terms as are set forth in Annex
I (the "Series A Capital Securities") and one class of common securities
representing undivided beneficial interests in the assets of the Trust having
such terms as are set forth in Annex I (the "Common Securities"). The
Administrative Trustees shall on behalf of the Trust issue one class of capital
securities representing undivided beneficial interests in the Trust having such
terms as set forth in Annex I (the "Series B Capital Securities") in exchange
for Series A Capital Securities accepted for exchange in the Exchange Offer,
which Series B Capital Securities shall not bear the legends required by Section
9.2(i) unless the Holder of such Series A Capital Securities is either (A) a
broker-dealer who purchased such Series A Capital Securities directly from the
Trust for resale pursuant to Rule 144A or any other available exemption under
the Securities Act, (B) a Person participating in the distribution of the Series
A Capital Securities or (C) a Person who is an affiliate (as defined in Rule
144A) of the Trust. The Trust shall issue no securities or other interests in
the assets of the Trust other than the Securities.
(b) The consideration received by the Trust for the issuance
of the Securities shall constitute a contribution to the capital of the Trust
and shall not constitute a loan to the Trust.
(c) Upon issuance of the Securities as provided in this
Declaration, the Securities so issued shall be deemed to be validly issued,
fully paid and non-assessable undivided beneficial interests in the assets of
the Trust.
(d) Every Person, by virtue of having become a Holder or a
Capital Security Beneficial Owner in accordance with the terms of this
Declaration, shall be deemed to have expressly assented and agreed to the terms
of, and shall be bound by, this Declaration.
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SECTION 7.2 Execution and Authentication.
(a) The Securities shall be signed on behalf of the Trust by
an Administrative Trustee. In case any Administrative Trustee of the Trust who
shall have signed any of the Securities shall cease to be such Administrative
Trustee before the Securities so signed shall be delivered by the Trust, such
Securities nevertheless may be delivered as though the person who signed such
Securities had not ceased to be such Administrative Trustee; and any Securities
may be signed on behalf of the Trust by such persons who, at the actual date of
execution of such Security, shall be the Administrative Trustees of the Trust,
although at the date of the execution and delivery of the Declaration any such
person was not such an Administrative Trustee.
(b) One Administrative Trustee shall sign the Capital
Securities for the Trust by manual or facsimile signature. Unless otherwise
determined by the Trust, such signature shall, in the case of Common Securities,
be a manual signature.
A Capital Security shall not be valid until authenticated by
the manual signature of an authorized signatory of the Property Trustee. The
signature shall be conclusive evidence that the Capital Security has been
authenticated under this Declaration.
Upon a written order of the Trust signed by one Administrative
Trustee, the Property Trustee shall authenticate the Capital Securities for
original issue. The aggregate number of Capital Securities outstanding at any
time shall not exceed the number set forth in the Terms in Annex I hereto except
as provided in Section 7.6.
The Property Trustee may appoint an authenticating agent
acceptable to the Trust to authenticate Capital Securities. An authenticating
agent may authenticate Capital Securities whenever the Property Trustee may do
so. Each reference in this Declaration to authentication by the Property Trustee
includes authentication by such agent. An authenticating agent has the same
rights as the Property Trustee to deal with the Sponsor or an Affiliate.
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SECTION 7.3 Form and Dating.
The Capital Securities and the Property Trustee's certificate
of authentication shall be substantially in the form of Exhibit A-1 and the
Common Securities shall be substantially in the form of Exhibit A-2, each of
which is hereby incorporated in and expressly made a part of this Declaration.
Certificates representing the Securities may be printed, lithographed or
engraved or may be produced in any other manner as is reasonably acceptable to
the Administrative Trustees, as evidenced by their execution thereof. The
Securities may have letters, CUSIP or other numbers, notations or other marks of
identification or designation and such legends or endorsements required by law,
stock exchange rule, agreements to which the Trust is subject, if any, or usage
(provided that any such notation, legend or endorsement is in a form acceptable
to the Trust). The Trust at the direction of the Sponsor shall furnish any such
legend not contained in Exhibit A-1 to the Property Trustee in writing. Each
Capital Security shall be dated the date of its authentication. The terms and
provisions of the Securities set forth in Annex I and the forms of Securities
set forth in Exhibits A-1 and A-2 are part of the terms of this Declaration and
to the extent applicable, the Property Trustee and the Sponsor, by their
execution and delivery of this Declaration, expressly agree to such terms and
provisions and to be bound thereby.
(a) Global Securities. Securities offered and sold to QIBs
shall be issued in the form of one or more permanent global Securities in
definitive, fully registered form without distribution coupons, with the global
legend and, if sold in reliance on Rule 144A, as provided in the Purchase
Agreement, the Restricted Securities Legend set forth in Exhibit A-1 hereto (a
"Restricted Global Capital Security"), and shall be deposited on behalf of the
purchasers of the Capital Securities represented thereby with the Property
Trustee, at its New York office, as custodian for the Clearing Agency, and
registered in the name of the Clearing Agency or a nominee of the Clearing
Agency, duly executed by the Trust and authenticated by the Property Trustee as
hereinafter provided. The number of Capital Securities represented by the Global
Capital Security may from time to time be increased or decreased by adjustments
made on the records of the Property Trustee and the Clearing Agency or its
nominee as hereinafter provided.
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(b) Book-Entry Provisions. This Section 7.3(b) shall apply
only to the Global Capital Security and such other Capital Securities in global
form as may be authorized by the Trust to be deposited with or on behalf of the
Clearing Agency.
The Trust shall execute and the Property Trustee shall, in
accordance with this Section 7.3, authenticate and make available for delivery
initially one or more Global Capital Securities that (i) shall be registered in
the name of Cede & Co. or other nominee of such Clearing Agency and (ii) shall
be delivered by the Trustee to such Clearing Agency or pursuant to such Clearing
Agency's written instructions or held by the Property Trustee as custodian for
the Clearing Agency.
Members of, or participants in, the Clearing Agency
("Participants") shall have no rights under this Declaration with respect to any
Global Capital Security held on their behalf by the Clearing Agency or by the
Property Trustee as the custodian of the Clearing Agency or under such Global
Capital Security, and the Clearing Agency may be treated by the Trust, the
Property Trustee and any agent of the Trust or the Property Trustee as the
absolute owner of such Global Capital Security for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent the Trust, the
Property Trustee or any agent of the Trust or the Property Trustee from giving
effect to any written certification, proxy or other authorization furnished by
the Clearing Agency or impair, as between the Clearing Agency and its
Participants, the operation of customary practices of such Clearing Agency
governing the exercise of the rights of a holder of a beneficial interest in any
Global Capital Security.
(c) Definitive Capital Securities. Except as provided in
Section 7.9, owners of beneficial interests in a Global Capital Security will
not be entitled to receive physical delivery of certificated Capital Securities
("Definitive Capital Securities"). Purchasers of Securities who are "accredited
investors" (as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under
the Securities Act) will receive Capital Securities in the form of individual
certificates in definitive, fully registered form without distribution coupons
and with the Restricted Securities Legend set forth in Exhibit A-1 hereto
("Restricted Definitive Capital Securities"); provided, however, that upon
transfer of such Restricted Definitive Capital Securities to a QIB, such
Restricted Definitive Capital Securities will, unless the Global Capital
Security has
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previously been exchanged, be exchanged for an interest in a Global Capital
Security pursuant to the provisions of Section 9.2. Restricted Definitive
Capital Securities will bear the Restricted Securities Legend set forth on
Exhibit A-1 unless removed in accordance with this Section 7.3 or Section 9.2.
(d) Authorized Denominations. The Capital Securities are
issuable only in denominations of $100,000 and any integral multiple thereof.
SECTION 7.4 Registrar, Paying Agent and Exchange Agent.
The Trust shall maintain in the Borough of Manhattan, The City
of New York, (i) an office or agency where Capital Securities may be presented
for registration of transfer ("Registrar"), (ii) an office or agency where
Capital Securities may be presented for payment ("Paying Agent") and (iii) an
office or agency where Securities may be presented for exchange ("Exchange
Agent"). The Registrar shall keep a register of the Capital Securities and of
their transfer. The Trust may appoint the Registrar, the Paying Agent and the
Exchange Agent and may appoint one or more co-registrars, one or more additional
paying agents and one or more additional exchange agents in such other locations
as it shall determine. The term "Registrar" includes any additional registrar,
"Paying Agent" includes any additional paying agent and the term "Exchange
Agent" includes any additional exchange agent. The Trust may change any Paying
Agent, Registrar, co-registrar or Exchange Agent without prior notice to any
Holder. The Paying Agent shall be permitted to resign as Paying Agent upon 30
days' written notice to the Administrative Trustees. The Trust shall notify the
Property Trustee of the name and address of any Agent not a party to this
Declaration. If the Trust fails to appoint or maintain another entity as
Registrar, Paying Agent or Exchange Agent, the Property Trustee shall act as
such. The Trust or any of its Affiliates may act as Paying Agent, Registrar, or
Exchange Agent. The Trust shall act as Paying Agent, Registrar, co-registrar,
and Exchange Agent for the Common Securities.
The Trust initially appoints the Property Trustee as
Registrar, Paying Agent, and Exchange Agent for the Capital Securities.
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SECTION 7.5 Paying Agent to Hold Money in Trust.
The Trust shall require each Paying Agent other than the
Property Trustee to agree in writing that the Paying Agent will hold in trust
for the benefit of Holders or the Property Trustee all money held by the Paying
Agent for the payment of liquidation amounts or Distributions on the Securities,
and will notify the Property Trustee if there are insufficient funds for such
purpose. While any such insufficiency continues, the Property Trustee may
require a Paying Agent to pay all money held by it to the Property Trustee. The
Trust at any time may require a Paying Agent to pay all money held by it to the
Property Trustee and to account for any money disbursed by it. Upon payment over
to the Property Trustee, the Paying Agent (if other than the Trust or an
Affiliate of the Trust) shall have no further liability for the money. If the
Trust or the Sponsor or an Affiliate of the Trust or the Sponsor acts as Paying
Agent, it shall segregate and hold in a separate trust fund for the benefit of
the Holders all money held by it as Paying Agent.
SECTION 7.6 Replacement Securities.
If a Holder claims that a Security owned by it has been lost,
destroyed or wrongfully taken or if such Security is mutilated and is
surrendered to the Trust or in the case of the Capital Securities to the
Property Trustee, the Trust shall issue and the Property Trustee shall
authenticate a replacement Security if the Property Trustee's and the Trust's
requirements, as the case may be, are met. An indemnity bond must be provided by
the Holder which, in the judgment of the Property Trustee, is sufficient to
protect the Trustees, the Sponsor or any authenticating agent from any loss
which any of them may suffer if a Security is replaced. The Trust may charge
such Holder for its expenses in replacing a Security.
Every replacement Security is an additional beneficial
interest in the Trust.
SECTION 7.7 Outstanding Capital Securities.
The Capital Securities outstanding at any time are all the
Capital Securities authenticated by the Property Trustee except for those
cancelled by it, those delivered to it for cancellation, and those described in
this Section as not outstanding.
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If a Capital Security is replaced, paid or purchased pursuant
to Section 7.6 hereof, it ceases to be outstanding unless the Property Trustee
receives proof satisfactory to it that the replaced, paid or purchased Capital
Security is held by a bona fide purchaser.
If Capital Securities are considered paid in accordance with
the terms of this Declaration, they cease to be outstanding and Distributions on
them shall cease to accumulate.
A Capital Security does not cease to be outstanding because
one of the Trust, the Sponsor or an Affiliate of the Sponsor holds the Security.
SECTION 7.8 Capital Securities in Treasury.
In determining whether the Holders of the required amount of
Securities have concurred in any direction, waiver or consent, Capital
Securities owned by the Trust, the Sponsor or an Affiliate of the Sponsor, as
the case may be, shall be disregarded and deemed not to be outstanding, except
that for the purposes of determining whether the Property Trustee shall be fully
protected in relying on any such direction, waiver or consent, only Securities
which the Property Trustee actually knows are so owned shall be so disregarded.
SECTION 7.9 Temporary Securities.
(a) Until Definitive Securities are ready for delivery, the
Trust may prepare and, in the case of the Capital Securities, the Property
Trustee shall authenticate temporary Securities. Temporary Securities shall be
substantially in the form of Definitive Securities but may have variations that
the Trust considers appropriate for temporary Securities. Without unreasonable
delay, the Trust shall prepare and, in the case of the Capital Securities, the
Property Trustee shall authenticate Definitive Securities in exchange for
temporary Securities.
(b) A Global Capital Security deposited with the Clearing
Agency or with the Property Trustee as custodian for the Clearing Agency
pursuant to Section 7.3 shall be transferred to the beneficial owners thereof in
the form of certificated Capital Securities only if such transfer complies with
Section 9.2 and (i) the Clearing Agency notifies the Sponsor that it is
unwilling or unable to continue as Clearing Agency for such Global Capital
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Security or if at any time such Clearing Agency ceases to be a "clearing agency"
registered under the Exchange Act and a clearing agency is not appointed by the
Sponsor within 90 days of such notice, (ii) a Default or an Event of Default has
occurred and is continuing, (iii) the Trust at its sole discretion elects to
cause the issuance of certificated Capital Securities or (iv) as permitted by
Section 9.2(f).
(c) Any Global Capital Security that is transferable to the
beneficial owners thereof in the form of certificated Capital Securities
pursuant to this Section 7.9 shall be surrendered by the Clearing Agency to the
Property Trustee located in the Borough of Manhattan, The City of New York, to
be so transferred, in whole or from time to time in part, without charge, and
the Property Trustee shall authenticate and make available for delivery, upon
such transfer of each portion of such Global Capital Security, an equal
aggregate liquidation amount of Securities of authorized denominations in the
form of certificated Capital Securities. Any portion of a Global Capital
Security transferred pursuant to this Section shall be registered in such names
as the Clearing Agency shall direct. Any Capital Security in the form of
certificated Capital Securities delivered in exchange for an interest in the
Restricted Global Capital Security shall, except as otherwise provided by
Sections 7.3 and 9.1, bear the Restricted Securities Legend set forth in Exhibit
A-1 hereto.
(d) Subject to the provisions of Section 7.9(c), the Holder of
a Global Capital Security may grant proxies and otherwise authorize any person,
including Participants and persons that may hold interests through Participants,
to take any action which such Holder is entitled to take under this Declaration
or the Securities.
(e) In the event of the occurrence of any of the events
specified in Section 7.9(b), the Trust will promptly make available to the
Property Trustee a reasonable supply of certificated Capital Securities in fully
registered form without distribution coupons.
SECTION 7.10 Cancellation.
The Trust at any time may deliver Capital Securities to the
Property Trustee for cancellation. The Registrar, Paying Agent and Exchange
Agent shall forward to the Property Trustee
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any Capital Securities surrendered to them for registration of transfer,
redemption, exchange or payment. The Property Trustee shall promptly cancel all
Capital Securities, surrendered for registration of transfer, redemption,
exchange, payment, replacement or cancellation and shall dispose of cancelled
Capital Securities as the Trust directs, provided that the Property Trustee
shall not be obligated to destroy Capital Securities. The Trust may not issue
new Capital Securities to replace Capital Securities that it has paid or that
have been delivered to the Property Trustee for cancellation or that any holder
has exchanged.
SECTION 7.11 CUSIP Numbers.
The Trust in issuing the Capital Securities may use "CUSIP"
numbers (if then generally in use), and, if so, the Property Trustee shall use
"CUSIP" numbers in notices of redemption as a convenience to Holders of Capital
Securities; provided that any such notice may state that no representation is
made as to the correctness of such numbers either as printed on the Capital
Securities or as contained in any notice of a redemption and that reliance may
be placed only on the other identification numbers printed on the Capital
Securities, and any such redemption shall not be affected by any defect in or
omission of such numbers. The Sponsor will promptly notify the Property Trustee
of any change in the CUSIP numbers.
ARTICLE VIII
TERMINATION OF TRUST
SECTION 8.1 Termination of Trust.
(a) The Trust shall automatically terminate:
(i) upon the bankruptcy of the Sponsor;
(ii) upon the filing of a certificate of dissolution or
liquidation or its equivalent with respect to the Sponsor; or the
revocation of the Sponsor's charter and the expiration of 90 days after
the date of revocation without a reinstatement thereof;
(iii) following the distribution of a Like Amount of the
Debentures to the Holders, provided that, the Property
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Trustee has received written notice from the Sponsor directing the
Property Trustee to terminate the Trust (which direction is optional,
and except as otherwise expressly provided below, within the discretion
of the Sponsor) and provided, further, that such direction and such
distribution is conditioned on (i) the receipt by the Sponsor or the
Trust, as the case requires, of any required regulatory approval, (ii)
the Administrative Trustees' receipt of an opinion of an independent
tax counsel experienced in such matters (a "No Recognition Opinion"),
which opinion may rely on published rulings of the Internal Revenue
Service, to the effect that the Holders will not recognize any gain or
loss for United States federal income tax purposes as a result of the
dissolution of the Trust and the distribution of Debentures;
(iv) upon the entry of a decree of judicial dissolution of
the Trust by a court of competent jurisdiction;
(v) when all of the Securities shall have been called for
redemption and the amounts necessary for redemption thereof shall have
been paid to the Holders in accordance with the terms of the
Securities;
(vi) the expiration of the term of the Trust provided in
Section 3.14.
(b) As soon as is practicable after the occurrence of an
event referred to in Section 8.1(a), the Administrative Trustees shall file a
certificate of cancellation with the Secretary of State of the State of
Delaware.
(c) The provisions of Section 3.9 and Article X shall
survive the termination of the Trust.
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 Transfer of Securities.
(a) Securities may only be transferred, in whole or in
part, in accordance with the terms and conditions set forth in this Declaration
and in the terms of the Securities. Any
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transfer or purported transfer of any Security not made in accordance with this
Declaration shall be null and void.
(b) Subject to this Article IX, Capital Securities may only be
transferred, in whole or in part, in accordance with the terms and conditions
set forth in this Declaration. Any transfer or purported transfer of any
security not made in accordance with this Declaration shall be null and void.
(c) The Common Securities may not be transferred except to the
Sponsor or an Affiliate of the Sponsor.
(d) The Administrative Trustees shall provide for the
registration of Capital Securities and of the transfer of Securities, which will
be effected without charge but only upon payment (with such indemnity as the
Administrative Trustees may require) in respect of any tax or other governmental
charges that may be imposed in relation to it. Upon surrender for registration
of transfer of any Capital Securities, the Administrative Trustees shall cause
one or more new Securities to be issued in the name of the designated transferee
or transferees. Every Capital Security surrendered for registration of transfer
shall be accompanied by a written instrument of transfer in form satisfactory to
the Administrative Trustees and the Registrar duly executed by the Holder or
such Holder's attorney duly authorized in writing. Each Capital Security
surrendered for registration of transfer shall be canceled by the Property
Trustee. A transferee of a Capital Security shall be entitled to the rights and
subject to the obligations of a Holder hereunder upon the receipt by such
transferee of a Capital Security. By acceptance of a Security, each transferee
shall be deemed to have agreed to be bound by this Declaration.
SECTION 9.2 Transfer Procedures and Restrictions
(a) General. Except as otherwise provided in Section 9.2(b),
if Capital Securities are issued upon the transfer, exchange or replacement of
Capital Securities bearing the Restricted Securities Legend set forth in Exhibit
A-1 hereto, or if a request is made to remove such Restricted Securities Legend
on Capital Securities, the Capital Securities so issued shall bear the
Restricted Securities Legend, or the Restricted Securities Legend shall not be
removed, as the case may be, unless there is delivered to the Trust and the
Property Trustee such satisfactory evidence, which shall include an Opinion of
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Counsel, as may be reasonably required by the Sponsor and the Property Trustee,
that neither the legend nor the restrictions on transfer set forth therein are
required to ensure that transfers thereof are made pursuant to an exception from
the registration requirements of the Securities Act or, with respect to
Restricted Securities, that such Securities are not "restricted" within the
meaning of Rule 144. Upon provision of such satisfactory evidence, the Property
Trustee, at the written direction of the Trust, shall authenticate and deliver
Capital Securities that do not bear the legend.
(b) Transfers After Effectiveness of a Registration Statement.
After the effectiveness of a Registration Statement with respect to any Capital
Securities, all requirements pertaining to legends on such Capital Securities
will cease to apply, and beneficial interests in a Capital Security in global
form without legends will be available to transferees of such Capital
Securities, upon exchange of the transferring holder's Restricted Definitive
Capital Security or directions to transfer such Holder's beneficial interest in
the Global Capital Security. No such transfer or exchange of a Restricted
Definitive Capital Security or of an interest in the Global Capital Security
shall be effective unless the transferor delivers to the Trust a certificate in
a form substantially similar to that attached hereto as the "Form of Assignment"
in Exhibit A-1. Except as otherwise provided in Section 9.2(m), after the
effectiveness of a Registration Statement, the Trust shall issue and the
Property Trustee, upon a written order of the Trust signed by one Administrative
Trustee, shall authenticate a Capital Security in global form without the
Restricted Securities Legend (the "Unrestricted Global Capital Security") to
deposit with the Clearing Agency to evidence transfers of beneficial interests
from the (i) Global Capital Security and (ii) Restricted Definitive Capital
Securities.
(c) Transfer and Exchange of Definitive Capital Securities.
When Definitive Capital Securities are presented to the Registrar
(x) to register the transfer of such Definitive Capital
Securities; or
(y) to exchange such Definitive Capital Securities for an
equal number of Definitive Capital Securities,
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the Registrar or co-registrar shall register the transfer or make the exchange
as requested if its reasonable requirements for such transaction are met;
provided, however, that the Definitive Capital Securities surrendered for
transfer or exchange:
(i) shall be duly endorsed or accompanied by a written
instrument of transfer in form reasonably satisfactory to the Trust and
the Registrar or co-registrar, duly executed by the Holder thereof or
his attorney duly authorized in writing; and
(ii) in the case of Definitive Capital Securities that are
Restricted Definitive Capital Securities:
(A) if such Restricted Capital Securities are being
delivered to the Registrar by a Holder for registration in the
name of such Holder, without transfer, a certification from
such Holder to that effect; or
(B) if such Restricted Capital Securities are being
transferred: (i) a certification from the transferor in a form
substantially similar to that attached hereto as the "Form of
Assignment" in Exhibit A-1, and (ii) if the Trust or Registrar
so requests, evidence reasonably satisfactory to them as to
the compliance with the restrictions set forth in the
Restricted Securities Legend.
(d) Restrictions on Transfer of a Definitive Capital Security
for a Beneficial Interest in a Global Capital Security. A Definitive Capital
Security may not be exchanged for a beneficial interest in a Global Capital
Security except upon satisfaction of the requirements set forth below. Upon
receipt by the Property Trustee of a Definitive Capital Security, duly endorsed
or accompanied by appropriate instruments of transfer, in form satisfactory to
the Property Trustee and the Administrative Trustees, together with:
(i) if such Definitive Capital Security is a Restricted
Capital Security, certification (in a form substantially similar to
that attached hereto as the "Form of Assignment" in Exhibit A-1); and
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(ii)whether or not such Definitive Capital Security is a
Restricted Capital Security, written instructions directing the
Property Trustee to make, or to direct the Clearing Agency to make, an
adjustment on its books and records with respect to the appropriate
Global Capital Security to reflect an increase in the number of the
Capital Securities represented by such Global Capital Security,
then the Property Trustee shall cancel such Definitive Capital Security and
cause, or direct the Clearing Agency to cause, the aggregate number of Capital
Securities represented by the appropriate Global Capital Security to be
increased accordingly. If no Global Capital Securities are then outstanding, the
Trust shall issue and the Property Trustee shall authenticate, upon written
order of any Administrative Trustee, an appropriate number of Capital Securities
in global form.
(e) Transfer and Exchange of Global Capital Securities.
Subject to Section 9.2(f), the transfer and exchange of Global Capital
Securities or beneficial interests therein shall be effected through the
Clearing Agency, in accordance with this Declaration (including applicable
restrictions on transfer set forth herein, if any) and the procedures of the
Clearing Agency therefor.
(f) Transfer of a Beneficial Interest in a Restricted Global
Capital Security for a Definitive Restricted Capital Security.
(i) Any Person having a beneficial interest in a
Restricted Global Capital Security may, upon transfer of such
beneficial interest to a Person who is an "accredited investor" (as
defined in Rule 501(a)(1)(2)(3) or (7) under Regulation D under the
Securities Act), exchange such beneficial interest for a Restricted
Definitive Capital Security representing the same number of Capital
Securities. Upon receipt by the Property Trustee from the Clearing
Agency or its nominee on behalf of any Person having a beneficial
interest in a Restricted Global Capital Security of 20 days prior
written notice with instructions or such other form of instructions as
is customary for the Clearing Agency or the Person designated by the
Clearing Agency as having such a beneficial interest in a Restricted
Capital Security and a certification from the transferor (in a form
substantially similar to that attached hereto as the "Form
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of Assignment" in Exhibit A-1), which may be submitted by facsimile,
the Property Trustee will cause the aggregate number of Capital
Securities represented by Restricted Global Capital Securities to be
reduced on its books and records and, following such reduction, the
Trust will execute and the Property Trustee will authenticate and make
available for delivery to the transferee a Restricted Definitive
Capital Security.
(ii)Definitive Capital Securities issued in exchange for
a beneficial interest in a Restricted Global Capital Security pursuant
to this Section 9.2(f) shall be registered in such names and in such
authorized denominations as the Clearing Agency, pursuant to
instructions from its Participants or indirect participants or
otherwise, shall instruct the Property Trustee in writing. The Property
Trustee shall deliver such Capital Securities to the persons in whose
names such Capital Securities are so registered in accordance with such
instructions of the Clearing Agency.
(g) Restrictions on Transfer and Exchange of Global Capital
Securities. Notwithstanding any other provisions of this Declaration (other than
the provisions set forth in subsection (h) of this Section 9.2), a Global
Capital Security may not be transferred as a whole except by the Clearing Agency
to a nominee of the Clearing Agency or another nominee of the Clearing Agency or
by the Clearing Agency or any such nominee to a successor Clearing Agency or a
nominee of such successor Clearing Agency.
(h) Authentication of Definitive Capital Securities. If at any
time:
(i) there occurs a Default or an Event of Default which is
continuing, or
(ii)the Administrative Trustees, in their sole discretion,
notify the Property Trustee in writing that they elect to cause the
issuance of Definitive Capital Securities under this Declaration,
then the Administrative Trustees will execute, and the Property Trustee, upon
receipt of a written order of the Trust signed by one Administrative Trustee
requesting the authentication and delivery of Definitive Capital Securities to
the Persons designated in such notice, will authenticate and make available
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for delivery Definitive Capital Securities, equal in number to the number of
Capital Securities represented by the Global Capital Securities, in exchange for
such Global Capital Securities.
(i) Legend.
(i) Except as permitted by the following paragraph (ii),
each Capital Security certificate evidencing the Global Capital
Securities and the Definitive Capital Securities (and all Capital
Securities issued in exchange therefor or substitution thereof) shall
bear a legend (the "Restricted Securities Legend") in substantially the
following form:
THE CAPITAL SECURITIES REPRESENTED HEREBY HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT") OR ANY STATE SECURITIES LAWS OR ANY OTHER
APPLICABLE SECURITIES LAW. NEITHER THIS CAPITAL SECURITY NOR
ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS CAPITAL SECURITY BY ITS ACCEPTANCE HEREOF
AGREES TO OFFER, SELL OR OTHERWISE TRANSFER THIS CAPITAL
SECURITY, PRIOR TO THE DATE (THE "RESALE RESTRICTION
TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUANCE DATE HEREOF AND THE LAST DATE ON WHICH AGL
RESOURCES INC. OR ANY "AFFILIATE" OF AGL RESOURCES INC. WAS
THE OWNER OF THIS CAPITAL SECURITY (OR ANY PREDECESSOR OF THIS
CAPITAL SECURITY) ONLY (A) TO AGL RESOURCES INC., (B) PURSUANT
TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE
UNDER THE SECURITIES ACT, (C) SO LONG AS THIS CAPITAL SECURITY
IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY
BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN
RULE 144A)
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THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF
SUBPARAGRAPH (A)(1), (2), (3) OR (7) OF RULE 501 OF REGULATION
D UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS CAPITAL
SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN
INSTITUTIONAL ACCREDITED INVESTOR, FOR INVESTMENT PURPOSES AND
NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH,
ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (E)
PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS UNDER THE SECURITIES ACT, SUBJECT TO
THE RIGHT OF THE TRUST AND AGL RESOURCES INC. PRIOR TO ANY
SUCH OFFER, SALE OR TRANSFER (i) PURSUANT TO CLAUSE (D) OR (E)
TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATIONS AND/OR OTHER INFORMATION SATISFACTORY TO EACH
OF THEM, AND (ii) PURSUANT TO CLAUSE (D), TO REQUIRE THAT THE
TRANSFEROR DELIVER TO THE TRUST A LETTER FROM THE TRANSFEREE
SUBSTANTIALLY IN THE FORM OF ANNEX A TO THE OFFERING
MEMORANDUM DATED JUNE 10, 1997. SUCH HOLDER FURTHER AGREES
THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS CAPITAL
SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT
OF THIS LEGEND.
THE HOLDER OF THIS CAPITAL SECURITY ACKNOWLEDGES THAT, BY ITS
ACCEPTANCE THEREOF, IT IS DEEMED TO HAVE AGREED TO BE BOUND BY
THE PROVISIONS OF THE REGISTRATION RIGHTS AGREEMENT DATED AS
OF JUNE 11, 1997.
(ii) Upon any sale or transfer of a Restricted Capital
Security (including any Restricted Capital Security represented by a
Global Capital Security) pursuant to an effective registration
statement under the Securities Act or pursuant to Rule 144 under the
Securities Act after such registration statement ceases to be
effective:
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(A) in the case of any Restricted Capital Security
that is a Definitive Capital Security, the Registrar shall
permit the Holder thereof to exchange such Restricted Capital
Security for a Definitive Capital Security that does not bear
the Restricted Securities Legend and rescind any restriction
on the transfer of such Restricted Capital Security; and
(B) in the case of any Restricted Capital Security
that is represented by a Global Capital Security, the
Registrar shall permit the Holder of such Global Capital
Security to exchange such Global Capital Security for another
Global Capital Security that does not bear the Restricted
Securities Legend.
(j) Cancellation or Adjustment of Global Capital
Security. At such time as all beneficial interests in a Global Capital
Security have either been exchanged for Definitive Capital Securities to the
extent permitted by this Declaration or redeemed, repurchased or canceled in
accordance with the terms of this Declaration, such Global Capital Security
shall be returned to the Property Trustee for cancellation or retained and
canceled by the Property Trustee. At any time prior to such cancellation, if
any beneficial interest in a Global Capital Security is exchanged for
Definitive Capital Securities, Capital Securities represented by such Global
Capital Security shall be reduced and an adjustment shall be made on the books
and records of the Property Trustee (if it is then the custodian for such
Global Capital Security) with respect to such Global Capital Security, by the
Property Trustee or the Securities Custodian, to reflect such reduction.
(k) Obligations with Respect to Transfers and Exchanges
of Capital Securities.
(i) To permit registrations of transfers and exchanges,
the Trust shall execute and the Property Trustee shall authenticate
Definitive Capital Securities and Global Capital Securities at the
Registrar's or co-Registrar's request in accordance with the terms of
this Declaration.
(ii) Registrations of transfers or exchanges will be
effected without charge, but only upon payment (with such indemnity as
the Trust or the Sponsor may require) in
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respect of any tax or other governmental charge that may be imposed in
relation to it.
(iii) The Registrar or co-registrar shall not be required
to register the transfer of or exchange of (a) Capital Securities
during a period beginning at the opening of business 15 days before the
day of mailing of a notice of redemption or any notice of selection of
Capital Securities for redemption and ending at the close of business
on the day of such mailing; or (b) any Capital Security so selected for
redemption in whole or in part, except the unredeemed portion of any
Capital Security being redeemed in part.
(iv) Prior to the due presentation for registrations of
transfer of any Capital Security, the Trust, the Property Trustee, the
Paying Agent, the Registrar or any co-registrar may deem and treat the
person in whose name a Capital Security is registered as the absolute
owner of such Capital Security for the purpose of receiving
Distributions on such Capital Security and for all other purposes
whatsoever, and none of the Trust, the Property Trustee, the Paying
Agent, the Registrar or any co-registrar shall be affected by notice to
the contrary.
(v) All Capital Securities issued upon any transfer or
exchange pursuant to the terms of this Declaration shall evidence the
same security and shall be entitled to the same benefits under this
Declaration as the Capital Securities surrendered upon such transfer or
exchange.
(l) No Obligation of the Property Trustee.
(i) The Property Trustee shall have no responsibility or
obligation to any beneficial owner of a Global Capital Security, a
Participant in the Clearing Agency or other Person with respect to the
accuracy of the records of the Clearing Agency or its nominee or of any
Participant thereof, with respect to any ownership interest in the
Capital Securities or with respect to the delivery to any Participant,
beneficial owner or other Person (other than the Clearing Agency) of
any notice (including any notice of redemption) or the payment of any
amount, under or with respect to such Capital Securities. All notices
and communications to be given to the Holders and all payments to be
made to Holders under the Capital Securities shall be
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given or made only to or upon the order of the registered Holders
(which shall be the Clearing Agency or its nominee in the case of a
Global Capital Security). The rights of beneficial owners in any Global
Capital Security shall be exercised only through the Clearing Agency
subject to the applicable rules and procedures of the Clearing Agency.
The Property Trustee may conclusively rely and shall be fully protected
in relying upon information furnished by the Clearing Agency or any
agent thereof with respect to its Participants and any beneficial
owners.
(ii) The Property Trustee and Registrar shall have no
obligation or duty to monitor, determine or inquire as to compliance
with any restrictions on transfer imposed under this Declaration or
under applicable law with respect to any transfer of any interest in
any Capital Security (including any transfers between or among Clearing
Agency Participants or beneficial owners in any Global Capital
Security) other than to require delivery of such certificates and other
documentation or evidence as are expressly required by, and to do so if
and when expressly required by, the terms of this Declaration, and to
examine the same to determine substantial compliance as to form with
the express requirements hereof.
(m) Exchange of Series A Capital Securities for Series B
Capital Securities. The Series A Capital Securities may be exchanged for Series
B Securities pursuant to the terms of the Exchange Offer. The Property Trustee
shall make the exchange as follows:
The Sponsor shall present the Property Trustee with an
Officers' Certificate certifying the following:
(A) upon issuance of the Series B Capital
Securities, the transactions contemplated by
the Exchange Offer have been consummated;
and
(B) the number of Series A Capital Securities
properly tendered in the Exchange Offer that
are represented by a Global Capital Security
and the number of Series A Capital
Securities properly tendered in the Exchange
Offer that are represented by
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Definitive Capital Securities, the name of
each Holder of such Definitive Capital
Securities, the liquidation amount of
Capital Securities properly tendered in the
Exchange Offer by each such Holder and the
name and address to which Definitive Capital
Securities for Series B Capital Securities
shall be registered and sent for each such
Holder.
The Property Trustee, upon receipt of (i) such Officers'
Certificate, (ii) an Opinion of Counsel (x) to the effect that the Series B
Capital Securities have been registered under Section 5 of the Securities Act
and the Indenture has been qualified under the Trust Indenture Act and (y) with
respect to the matters set forth in Section 3(p) of the Registration Rights
Agreement and (iii) a Company Order, shall authenticate (A) a Global Capital
Security for Series B Capital Securities in aggregate liquidation amount equal
to the aggregate liquidation amount of (A) Series A Capital Securities
represented by a Global Capital Security indicated in such Officers' Certificate
as having been properly tendered and (B) Definitive Capital Securities
representing Series B Capital Securities registered in the names of, and in the
liquidation amounts indicated in such Officers' Certificate.
If, upon consummation of the Exchange Offer, less than all the
outstanding Series A Capital Securities shall have been properly tendered and
not withdrawn, the Property Trustee shall make an endorsement on the Global
Capital Security for Series A Capital Securities indicating the reduction in the
number and aggregate liquidation amount represented thereby as a result of the
Exchange Offer.
(n) Minimum Transfers. Series A Capital Securities may only be
transferred in minimum blocks of $100,000 aggregate liquidation amount until
such Series A Capital Securities are registered pursuant to an effective
registration statement filed under the Securities Act.
SECTION 9.3 Deemed Security Holders.
The Trustees may treat the Person in whose name any Security
shall be registered on the books and records of the Trust as the sole owner of
such Security for purposes of
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receiving Distributions and for all other purposes whatsoever and, accordingly,
shall not be bound to recognize any equitable or other claim to or interest in
such Security on the part of any Person, whether or not the Trust shall have
actual or other notice thereof.
SECTION 9.4 Book Entry Interests.
Global Capital Securities shall initially be registered on the
books and records of the Trust in the name of Cede & Co., the nominee of the
Clearing Agency, and no Capital Security Beneficial Owner will receive a
definitive Capital Security Certificate representing such Capital Security
Beneficial Owner's interests in such Global Capital Securities, except as
provided in Section 9.2 and Section 7.9. Unless and until definitive, fully
registered Capital Securities certificates have been issued to the Capital
Security Beneficial Owners pursuant to Section 9.2 or Section 7.9:
(a) the provisions of this Section 9.4 shall be in full force
and effect;
(b) the Trust and the Trustees shall be entitled to deal with
the Clearing Agency for all purposes of this Declaration (including the
payment of Distributions on the Global Capital Securities and receiving
approvals, votes or consents hereunder) as the Holder of the Capital
Securities and the sole holder of the Global Certificates and shall
have no obligation to the Capital Security Beneficial Owners;
(c) to the extent that the provisions of this Section 9.4
conflict with any other provisions of this Declaration, the provisions
of this Section 9.4 shall control; and
(d) the rights of the Capital Security Beneficial Owners shall
be exercised only through the Clearing Agency and shall be limited to
those established by law and agreements between such Capital Security
Beneficial Owners and the Clearing Agency and/or the Clearing Agency
Participants and receive and transmit payments of Distributions on the
Global Certificates to such Clearing Agency Participants. DTC will make
book entry transfers among the Clearing Agency Participants.
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SECTION 9.5 Notices to Clearing Agency.
Whenever a notice or other communication to the Capital
Security Holders is required under this Declaration, the Trustees shall give all
such notices and communications specified herein to be given to the Holders of
Global Capital Securities to the Clearing Agency, and shall have no notice
obligations to the Capital Security Beneficial Owners.
SECTION 9.6 Appointment of Successor Clearing Agency.
If any Clearing Agency elects to discontinue its services as
securities depositary with respect to the Capital Securities, the Administrative
Trustees may, in their sole discretion, appoint a successor Clearing Agency with
respect to such Capital Securities.
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability.
(a) Except as expressly set forth in this Declaration, the
Securities Guarantees and the terms of the Securities, the Sponsor shall not be:
(i) personally liable for the return of any portion of the
capital contributions (or any return thereon) of the Holders of the
Securities which shall be made solely from assets of the Trust; and
(ii)be required to pay to the Trust or to any Holder of
Securities any deficit upon dissolution of the Trust or otherwise.
(b) The Sponsor shall be liable for all of the debts and
obligations of the Trust (other than with respect to the payment of principal,
interest and premium, if any, on the Securities) to the extent not satisfied out
of the Trust's assets.
(c) Pursuant to Section 3803(a) of the Business Trust Act, the
Holders of the Capital Securities shall be entitled to the
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same limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware.
SECTION 10.2 Exculpation.
(a) No Indemnified Person shall be liable, responsible or
accountable in damages or otherwise to the Trust or any Covered Person for any
loss, damage or claim incurred by reason of any act or omission performed or
omitted by such Indemnified Person in good faith on behalf of the Trust and in a
manner such Indemnified Person reasonably believed to be within the scope of the
authority conferred on such Indemnified Person by this Declaration or by law,
except that an Indemnified Person shall be liable for any such loss, damage or
claim incurred by reason of such Indemnified Person's gross negligence or
willful misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying
in good faith upon the records of the Trust and upon such information, opinions,
reports or statements presented to the Trust by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Trust, including information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and amount of assets from
which Distributions to Holders of Securities might properly be paid.
SECTION 10.3 Fiduciary Duty.
(a) To the extent that, at law or in equity, an Indemnified
Person has duties (including fiduciary duties) and liabilities relating thereto
to the Trust or to any other Covered Person, an Indemnified Person acting under
this Declaration shall not be liable to the Trust or to any other Covered Person
for its good faith reliance on the provisions of this Declaration. The
provisions of this Declaration, to the extent that they restrict the duties and
liabilities of an Indemnified Person otherwise existing at law or in equity
(other than the duties imposed on the Property Trustee under the Trust Indenture
Act), are agreed by the parties hereto to replace such other duties and
liabilities of such Indemnified Person.
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(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises
between any Covered Persons; or
(ii) whenever this Declaration or any other agreement
contemplated herein or therein provides that an Indemnified Person
shall act in a manner that is, or provides terms that are, fair and
reasonable to the Trust or any Holder of Securities,
the Indemnified Person shall resolve such conflict of interest, take such action
or provide such terms, considering in each case the relative interest of each
party (including its own interest) to such conflict, agreement, transaction or
situation and the benefits and burdens relating to such interests, any customary
or accepted industry practices, and any applicable generally accepted accounting
practices or principles. In the absence of bad faith by the Indemnified Person,
the resolution, action or term so made, taken or provided by the Indemnified
Person shall not constitute a breach of this Declaration or any other agreement
contemplated herein or of any duty or obligation of the Indemnified Person at
law or in equity or otherwise.
(c) Whenever in this Declaration an Indemnified Person is
permitted or required to make a decision:
(i) in its "discretion" or under a grant of similar
authority, the Indemnified Person shall be entitled to consider such
interests and factors as it desires, including its own interests, and
shall have no duty or obligation to give any consideration to any
interest of or factors affecting the Trust or any other Person; or
(ii) in its "good faith" or under another express
standard, the Indemnified Person shall act under such express standard
and shall not be subject to any other or different standard imposed by
this Declaration or by applicable law.
SECTION 10.4 Indemnification.
(a) (i) The Sponsor shall indemnify, to the full extent
permitted by law, any Company Indemnified Person who was or is a party
or is threatened to be made a party to any
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threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative (other than an action
by or in the right of the Trust) by reason of the fact that he is or
was a Company Indemnified Person against expenses (including attorneys'
fees and expenses), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such action,
suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of
the Trust, and, with respect to any criminal action or proceeding, had
no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of itself, create a presumption that the Company
Indemnified Person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of
the Trust, and, with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful.
(ii) The Sponsor shall indemnify, to the full extent
permitted by law, any Company Indemnified Person who was or is a party
or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the Trust to procure a
judgment in its favor by reason of the fact that he is or was a Company
Indemnified Person against expenses (including attorneys' fees and
expenses) actually and reasonably incurred by him in connection with
the defense or settlement of such action or suit if he acted in good
faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the Trust and except that no such indemnification
shall be made in respect of any claim, issue or matter as to which such
Company Indemnified Person shall have been adjudged to be liable to the
Trust unless and only to the extent that the Court of Chancery of
Delaware or the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability
but in view of all the circumstances of the case, such person is fairly
and reasonably entitled to indemnity for such expenses which such Court
of Chancery or such other court shall deem proper.
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(iii) To the extent that a Company Indemnified Person shall
be successful on the merits or otherwise (including dismissal of an
action without prejudice or the settlement of an action without
admission of liability) in defense of any action, suit or proceeding
referred to in paragraphs (i) and (ii) of this Section 10.4(a), or in
defense of any claim, issue or matter therein, he shall be indemnified,
to the full extent permitted by law, against expenses (including
attorneys' fees) actually and reasonably incurred by him in connection
therewith.
(iv) Any indemnification under paragraphs (i) and (ii) of
this Section 10.4(a) (unless ordered by a court) shall be made by the
Debenture Issuer only as authorized in the specific case upon a
determination that indemnification of the Company Indemnified Person is
proper in the circumstances because he has met the applicable standard
of conduct set forth in paragraphs (i) and (ii). Such determination
shall be made (1) by the Administrative Trustees by a majority vote of
a quorum consisting of such Administrative Trustees who were not
parties to such action, suit or proceeding, (2) if such a quorum is not
obtainable, or, even if obtainable, if a quorum of disinterested
Administrative Trustees so directs, by independent legal counsel in a
written opinion, or (3) by the Common Security Holder of the Trust.
(v) Expenses (including attorneys' fees and expenses)
incurred by a Company Indemnified Person in defending a civil,
criminal, administrative or investigative action, suit or proceeding
referred to in paragraphs (i) and (ii) of this Section 10.4(a) shall be
paid by the Debenture Issuer in advance of the final disposition of
such action, suit or proceeding upon receipt of an undertaking by or on
behalf of such Company Indemnified Person to repay such amount if it
shall ultimately be determined that he is not entitled to be
indemnified by the Debenture Issuer as authorized in this Section
10.4(a). Notwithstanding the foregoing, no advance shall be made by the
Debenture Issuer if a determination is reasonably and promptly made (i)
by the Administrative Trustees by a majority vote of a quorum of
disinterested Administrative Trustees, (ii) if such a quorum is not
obtainable, or, even if obtainable, if a quorum of disinterested
Administrative Trustees so directs, by independent legal counsel in a
written opinion or (iii)
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the Common Security Holder of the Trust, that, based upon the facts
known to the Administrative Trustees, counsel or the Common Security
Holder at the time such determination is made, such Company Indemnified
Person acted in bad faith or in a manner that such person did not
believe to be in or not opposed to the best interests of the Trust, or,
with respect to any criminal proceeding, that such Company Indemnified
Person believed or had reasonable cause to believe his conduct was
unlawful. In no event shall any advance be made in instances where the
Administrative Trustees, independent legal counsel or Common Security
Holder reasonably determine that such person deliberately breached his
duty to the Trust or its Common or Capital Security Holders.
(vi) The indemnification and advancement of expenses
provided by, or granted pursuant to, the other paragraphs of this
Section 10.4(a) shall not be deemed exclusive of any other rights to
which those seeking indemnification and advancement of expenses may be
entitled under any agreement, vote of stockholders or disinterested
directors of the Debenture Issuer or Capital Security Holders of the
Trust or otherwise, both as to action in his official capacity and as
to action in another capacity while holding such office. All rights to
indemnification under this Section 10.4(a) shall be deemed to be
provided by a contract between the Debenture Issuer and each Company
Indemnified Person who serves in such capacity at any time while this
Section 10.4(a) is in effect. Any repeal or modification of this
Section 10.4(a) shall not affect any rights or obligations then
existing.
(vii) The Debenture Issuer or the Trust may purchase and
maintain insurance on behalf of any person who is or was a Company
Indemnified Person against any liability asserted against him and
incurred by him in any such capacity, or arising out of his status as
such, whether or not the Debenture Issuer would have the power to
indemnify him against such liability under the provisions of this
Section 10.4(a).
(viii) For purposes of this Section 10.4(a), references to
"the Trust" shall include, in addition to the resulting or surviving
entity, any constituent entity (including any constituent of a
constituent) absorbed in a consolidation or merger, so that any person
who is or was a
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director, trustee, officer or employee of such constituent entity, or
is or was serving at the request of such constituent entity as a
director, trustee, officer, employee or agent of another entity, shall
stand in the same position under the provisions of this Section 10.4(a)
with respect to the resulting or surviving entity as he would have with
respect to such constituent entity if its separate existence had
continued.
(ix) The indemnification and advancement of expenses
provided by, or granted pursuant to, this Section 10.4(a) shall, unless
otherwise provided when authorized or ratified, continue as to a person
who has ceased to be a Company Indemnified Person and shall inure to
the benefit of the heirs, executors and administrators of such a
person.
(b) The Debenture Issuer agrees to indemnify the (i)
Property Trustee, (ii) the Delaware Trustee, (iii) any Affiliate of the
Property Trustee and the Delaware Trustee, and (iv) any officers, directors,
shareholders, members, partners, employees, representatives, custodians,
nominees or agents of the Property Trustee and the Delaware Trustee (each of
the Persons in (i) through (iv) being referred to as a "Fiduciary Indemnified
Person") for, and to hold each Fiduciary Indemnified Person harmless against,
any and all loss, liability, damage, claim or expense including taxes (other
than taxes based on the income of such Fiduciary Indemnified Person) incurred
without negligence or bad faith on its part, arising out of or in connection
with the acceptance or administration of the trust or trusts hereunder,
including the costs and expenses (including reasonable legal fees and expenses)
of defending itself against or investigating any claim or liability in
connection with the exercise or performance of any of its powers or duties
hereunder. The obligation to indemnify as set forth in this Section 10.4(b)
shall survive the satisfaction and discharge of this Declaration.
SECTION 10.5 Outside Businesses.
Any Covered Person, the Sponsor, the Delaware Trustee and the
Property Trustee may engage in or possess an interest in other business ventures
of any nature or description, independently or with others, similar or
dissimilar to the business of the Trust, and the Trust and the Holders shall
have no rights by virtue of this Declaration in and to such independent ventures
or the income or profits derived therefrom,
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and the pursuit of any such venture, even if competitive with the business of
the Trust, shall not be deemed wrongful or improper. No Covered Person, the
Sponsor, the Delaware Trustee, or the Property Trustee shall be obligated to
present any particular investment or other opportunity to the Trust even if such
opportunity is of a character that, if presented to the Trust, could be taken by
the Trust, and any Covered Person, the Sponsor, the Delaware Trustee and the
Property Trustee shall have the right to take for its own account (individually
or as a partner or fiduciary) or to recommend to others any such particular
investment or other opportunity. Any Covered Person, the Delaware Trustee and
the Property Trustee may engage or be interested in any financial or other
transaction with the Sponsor or any Affiliate of the Sponsor, or may act as
depositary for, trustee or agent for, or act on any committee or body of holders
of, securities or other obligations of the Sponsor or its Affiliates.
ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year.
The fiscal year ("Fiscal Year") of the Trust shall be the
calendar year, or such other year as is required by the Code.
SECTION 11.2 Certain Accounting Matters.
(a) At all times during the existence of the Trust, the
Administrative Trustees shall keep, or cause to be kept, full books of account,
records and supporting documents, which shall reflect in reasonable detail, each
transaction of the Trust. The books of account shall be maintained on the
accrual method of accounting, in accordance with generally accepted accounting
principles, consistently applied. The Trust shall use the accrual method of
accounting for United States federal income tax purposes. The books of account
and the records of the Trust shall be examined by and reported upon as of the
end of each Fiscal Year of the Trust by a firm of independent certified public
accountants selected by the Administrative Trustees.
(b) The Administrative Trustees shall cause to be duly
prepared and delivered to each of the Holders, any annual United States federal
income tax information statement, required
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by the Code, containing such information with regard to the Securities held by
each Holder as is required by the Code and the Treasury Regulations.
Notwithstanding any right under the Code to deliver any such statement at a
later date, the Administrative Trustees shall endeavor to deliver all such
information statements within 30 days after the end of each Fiscal Year of the
Trust.
(c) The Administrative Trustees shall cause to be duly
prepared and filed with the appropriate taxing authority, an annual United
States federal income tax return, on a Form 1041 or such other form required by
United States federal income tax law, and any other annual income tax returns
required to be filed by the Administrative Trustees on behalf of the Trust with
any state or local taxing authority.
SECTION 11.3 Banking.
The Trust shall maintain one or more bank accounts in the name
and for the sole benefit of the Trust; provided, however, that all payments of
funds in respect of the Debentures held by the Property Trustee shall be made
directly to the Property Trustee Account and no other funds of the Trust shall
be deposited in the Property Trustee Account. The sole signatories for such
accounts shall be designated by the Administrative Trustees; provided, however,
that the Property Trustee shall designate the signatories for the Property
Trustee Account.
SECTION 11.4 Withholding.
The Trust and the Administrative Trustees shall comply with
all withholding requirements under United States federal, state and local law.
The Trust shall request, and the Holders shall provide to the Trust, such forms
or certificates as are necessary to establish an exemption from withholding with
respect to each Holder, and any representations and forms as shall reasonably be
requested by the Trust to assist it in determining the extent of, and in
fulfilling, its withholding obligations. The Administrative Trustees shall file
required forms with applicable jurisdictions and, unless an exemption from
withholding is properly established by a Holder, shall remit amounts withheld
with respect to the Holder to applicable jurisdictions. To the extent that the
Trust is required to withhold and pay over any amounts to any authority with
respect to Distributions or allocations to any Holder, the amount
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withheld shall be deemed to be a Distribution in the amount of the withholding
to the Holder. In the event of any claimed over withholding, Holders shall be
limited to an action against the applicable jurisdiction. If the amount required
to be withheld was not withheld from actual Distributions made, the Trust may
reduce subsequent Distributions by the amount of such withholding.
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments.
(a) Except as otherwise provided in this Declaration or
by any applicable terms of the Securities, this Declaration may only be
amended by a written instrument approved and executed by:
(i) the Administrative Trustees (or if there are more
than two Administrative Trustees a majority of the Administrative
Trustees);
(ii) if the amendment affects the rights, powers, duties,
obligations or immunities of the Property Trustee, the Property
Trustee; and
(iii) if the amendment affects the rights, powers, duties,
obligations or immunities of the Delaware Trustee, the Delaware
Trustee.
(b) No amendment shall be made, and any such purported
amendment shall be void and ineffective:
(i) unless, in the case of any proposed amendment, the
Property Trustee shall have first received an Officers' Certificate
from each of the Trust and the Sponsor that such amendment is permitted
by, and conforms to, the terms of this Declaration (including the terms
of the Securities);
(ii) unless, in the case of any proposed amendment which
affects the rights, powers, duties, obligations or immunities of the
Property Trustee, the Property Trustee shall have first received:
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(A) an Officers' Certificate from each of the Trust
and the Sponsor that such amendment is permitted by, and
conforms to, the terms of this Declaration (including the
terms of the Securities); and
(B) an opinion of counsel (who may be counsel to the
Sponsor or the Trust) that such amendment is permitted by, and
conforms to, the terms of this Declaration (including the
terms of the Securities),
provided, however, that the Property Trustee shall not be required to
sign any such amendment, and
(iii) to the extent the result of such amendment would be
to:
(A) cause the Trust to fail to continue to be
classified for purposes of United States federal income
taxation as a grantor trust;
(B) reduce or otherwise adversely affect the powers
of the Property Trustee in contravention of the Trust
Indenture Act; or
(C) cause the Trust to be deemed to be an Investment
Company required to be registered under the Investment Company
Act;
(c) At such time after the Trust has issued any
Securities that remain outstanding, any amendment that would adversely affect
the rights, privileges or preferences of any Holder of Securities may be
effected only with such additional requirements as may be set forth in the
terms of such Securities;
(d) Section 9.1(c) and this Section 12.1 shall not be
amended without the consent of all of the Holders of the Securities;
(e) Article Four shall not be amended without the
consent of the Holders of a Majority in liquidation amount of the Common
Securities and;
(f) The rights of the holders of the Common Securities
under Article Five to increase or decrease the number of, and appoint and remove
Trustees shall not be amended without
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the consent of the Holders of a Majority in liquidation amount of the Common
Securities; and
(g) Notwithstanding Section 12.1(c), this Declaration
may be amended without the consent of the Holders of the Securities to:
(i) cure any ambiguity, correct or supplement any
provision in this Declaration that may be inconsistent with any other
provision of this Declaration or to make any other provisions with
respect to matters or questions arising under this Declaration which
shall not be inconsistent with the other provisions of the Declaration;
and
(ii) to modify, eliminate or add to any provisions of the
Declaration to such extent as shall be necessary to ensure that the
Trust will be classified for United States federal income tax purposes
as a grantor trust at all times that any Securities are outstanding or
to ensure that the Trust will not be required to register as an
Investment Company under the Investment Company Act.
provided, however, such action shall not adversely affect in any material
respect the interests of the Holders, and any amendments of this Declaration
shall become effective when notice thereof is given to the Holders.
SECTION 12.2 Meetings of the Holders; Action by Written Consent.
(a) Meetings of the Holders of any class of Securities
may be called at any time by the Administrative Trustees (or as provided in the
terms of the Securities) to consider and act on any matter on which Holders of
such class of Securities are entitled to act under the terms of this
Declaration, the terms of the Securities or the rules of any stock exchange on
which the Capital Securities are listed or admitted for trading. The
Administrative Trustees shall call a meeting of the Holders of such class if
directed to do so by the Holders of at least 25% in liquidation amount of such
class of Securities. Such direction shall be given by delivering to the
Administrative Trustees one or more notices in a writing stating that the
signing Holders of Securities wish to call a meeting and indicating the general
or specific purpose for which the meeting is to be called. Any Holders calling
a meeting shall specify in
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writing the Security Certificates held by the Holders exercising the right to
call a meeting and only those Securities specified shall be counted for purposes
of determining whether the required percentage set forth in the second sentence
of this paragraph has been met.
(b) Except to the extent otherwise provided in the terms
of the Securities, the following provisions shall apply to meetings of Holders
of Securities:
(i) notice of any such meeting shall be given to all the
Holders of Securities having a right to vote thereat at least seven
days and not more than 60 days before the date of such meeting.
Whenever a vote, consent or approval of the Holders is permitted or
required under this Declaration or the rules of any stock exchange on
which the Capital Securities are listed or admitted for trading, such
vote, consent or approval may be given at a meeting of the Holders. Any
action that may be taken at a meeting of the Holders of Securities may
be taken without a meeting if a consent in writing setting forth the
action so taken is signed by the Holders of Securities owning not less
than the minimum amount of Securities in liquidation amount that would
be necessary to authorize or take such action at a meeting at which all
Holders having a right to vote thereon were present and voting. Prompt
notice of the taking of action without a meeting shall be given to the
Holders entitled to vote who have not consented in writing. The
Administrative Trustees may specify that any written ballot submitted
to the Security Holders for the purpose of taking any action without a
meeting shall be returned to the Trust within the time specified by the
Administrative Trustees;
(ii) each Holder may authorize any Person to act for it by
proxy on all matters in which a Holder is entitled to participate,
including waiving notice of any meeting, or voting or participating at
a meeting. No proxy shall be valid after the expiration of 11 months
from the date thereof unless otherwise provided in the proxy. Every
proxy shall be revocable at the pleasure of the Holder of Securities
executing it. Except as otherwise provided herein, all matters relating
to the giving, voting or validity of proxies shall be governed by the
General Corporation Law of the State of Delaware relating to proxies,
and judicial interpretations thereunder, as if the
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Trust were a Delaware corporation and the Holders were stockholders of
a Delaware corporation;
(iii) each meeting of the Holders shall be conducted by the
Administrative Trustees or by such other Person that the Administrative
Trustees may designate; and
(iv) unless the Business Trust Act, this Declaration, the
terms of the Securities, the Trust Indenture Act or the listing rules
of any stock exchange on which the Capital Securities are then listed
or trading otherwise provides, the Administrative Trustees, in their
sole discretion, shall establish all other provisions relating to
meetings of Holders, including notice of the time, place or purpose of
any meeting at which any matter is to be voted on by any Holders of
Securities, waiver of any such notice, action by consent without a
meeting, the establishment of a record date, quorum requirements,
voting in person or by proxy or any other matter with respect to the
exercise of any such right to vote.
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1 Representations and Warranties of Property Trustee.
The Trustee that acts as initial Property Trustee represents
and warrants to the Trust and to the Sponsor at the date of this Declaration,
and each Successor Property Trustee represents and warrants to the Trust and the
Sponsor at the time of the Successor Property Trustee's acceptance of its
appointment as Property Trustee that:
(a) The Property Trustee is a New York banking corporation
with trust powers and authority to execute and deliver, and to carry out and
perform its obligations under the terms of, this Declaration;
(b) The execution, delivery and performance by the Property
Trustee of the Declaration has been duly authorized by all necessary corporate
action on the part of the Property Trustee. The Declaration has been duly
executed and delivered by
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the Property Trustee and constitutes a legal, valid and binding obligation of
the Property Trustee, enforceable against it in accordance with its terms,
subject to applicable bankruptcy, reorganization, moratorium, insolvency, and
other similar laws affecting creditors' rights generally and to general
principles of equity and the discretion of the court (regardless of whether the
enforcement of such remedies is considered in a proceeding in equity or at law);
(c) The execution, delivery and performance of this
Declaration by the Property Trustee does not conflict with or constitute a
breach of the charter or by-laws of the Property Trustee; and
(d) No consent, approval or authorization of, or registration
with or notice to, any New York State or federal banking authority is required
for the execution, delivery or performance by the Property Trustee of this
Declaration.
SECTION 13.2 Representations and Warranties of Delaware Trustee.
The Trustee that acts as initial Delaware Trustee represents
and warrants to the Trust and to the Sponsor at the date of this Declaration,
and each Successor Delaware Trustee represents and warrants to the Trust and the
Sponsor at the time of the Successor Delaware Trustee's acceptance of its
appointment as Delaware Trustee that:
(a) The Delaware Trustee, if an entity, is duly organized,
validly existing and in good standing under the laws of the State of Delaware,
with corporate power and authority to execute and deliver, and to carry out and
perform its obligations under the terms of, this Declaration;
(b) The execution, delivery and performance by the Delaware
Trustee of this Declaration has been duly authorized by all necessary corporate
action on the part of the Delaware Trustee. This Declaration has been duly
executed and delivered by the Delaware Trustee and constitutes a legal, valid
and binding obligation of the Delaware Trustee, enforceable against it in
accordance with its terms, subject to applicable bankruptcy, reorganization,
moratorium, insolvency, and other similar laws affecting creditors' rights
generally and to general principles of equity and the discretion of the court
(regardless
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of whether the enforcement of such remedies is considered in a proceeding in
equity or at law);
(c) No consent, approval or authorization of, or registration
with or notice to, any federal banking authority is required for the execution,
delivery or performance by the Delaware Trustee of this Declaration; and
(d) The Delaware Trustee is a natural person who is a resident
of the State of Delaware or, if not a natural person, an entity which has its
principal place of business in the State of Delaware.
ARTICLE XIV
REGISTRATION RIGHTS
SECTION 14.1 Registration Rights Agreement; Liquidated Damages.
The Holders of the Capital Securities, the Debentures and the
Capital Securities Guarantee (collectively, the "Registrable Securities") are
entitled to the benefits of a Registration Rights Agreement.
ARTICLE XV
MISCELLANEOUS
SECTION 15.1 Notices.
All notices provided for in this Declaration shall be in
writing, duly signed by the party giving such notice, and shall be delivered,
telecopied or mailed by first class mail, as follows:
(a) if given to the Trust, in care of the Administrative
Trustees at the Trust's mailing address set forth below (or such other address
as the Trust may give notice of to the Holders):
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AGL Capital Trust
c/o AGL Resources Inc.
303 Peachtree Street, N.E.
Atlanta, Georgia 30308
Attention: J. Michael Riley, Administrative Trustee
(b) if given to the Delaware Trustee, at the mailing
address set forth below (or such other address as Delaware Trustee may give
notice of to the Holders):
The Bank of New York (Delaware)
White Clay Center, Route 273
Newark, Delaware 19711
Attention: Corporate Trust Trustee Administration
(c) if given to the Property Trustee, at the Property
Trustee's mailing address set forth below (or such other address as the Property
Trustee may give notice of to the Holders):
The Bank of New York
101 Barclay Street, 21 West
New York, New York 10286
Attention: Corporate Trust Trustee Administration
(d) if given to the Holder of the Common Securities, at
the mailing address of the Sponsor set forth below (or such other address as the
Holder of the Common Securities may give notice to the Trust):
AGL Resources Inc.
303 Peachtree Street, N.E.
Atlanta, Georgia 30308
Attention: J. Michael Riley, Vice President and CFO
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(e) if given to any other Holder, at the address set forth on
the books and records of the Trust.
All such notices shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first class
mail, postage prepaid except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no notice
was given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.
SECTION 15.2 Governing Law.
This Declaration and the rights of the parties hereunder shall
be governed by and interpreted in accordance with the laws of the State of
Delaware and all rights and remedies shall be governed by such laws without
regard to principles of conflict of laws.
SECTION 15.3 Intention of the Parties.
It is the intention of the parties hereto that the Trust be
classified for United States federal income tax purposes as a grantor trust. The
provisions of this Declaration shall be interpreted to further this intention of
the parties.
SECTION 15.4 Headings.
Headings contained in this Declaration are inserted for
convenience of reference only and do not affect the interpretation of this
Declaration or any provision hereof.
SECTION 15.5 Successors and Assigns
Whenever in this Declaration any of the parties hereto is
named or referred to, the successors and assigns of such party shall be deemed
to be included, and all covenants and agreements in this Declaration by the
Sponsor and the Trustees shall bind and inure to the benefit of their respective
successors and assigns, whether so expressed.
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SECTION 15.6 Partial Enforceability.
If any provision of this Declaration, or the application of
such provision to any Person or circumstance, shall be held invalid, the
remainder of this Declaration, or the application of such provision to persons
or circumstances other than those to which it is held invalid, shall not be
affected thereby.
SECTION 15.7 Counterparts.
This Declaration may contain more than one counterpart of the
signature page and this Declaration may be executed by the affixing of the
signature of each of the Trustees to one of such counterpart signature pages.
All of such counterpart signature pages shall be read as though one, and they
shall have the same force and effect as though all of the signers had signed a
single signature page.
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IN WITNESS WHEREOF, the undersigned has caused these presents
to be executed as of the day and year first above written.
/s/ David R. Jones
--------------------------------------------
David R. Jones, as Administrative
Trustee
/s/ Charles W. Bass
--------------------------------------------
Charles W. Bass, as Administrative
Trustee
/s/ J. Michael Riley
--------------------------------------------
J. Michael Riley, as Administrative
Trustee
The Bank of New York (Delaware),
as Delaware Trustee
By:/s/ Walter N. Gitlin
-----------------------------------------
Name: Walter N. Gitlin
Title: Authorized Signatory
The Bank of New York,
as Property Trustee
By:/s/ Stephen J. Giurlando
-----------------------------------------
Name: Stephen J. Giurlando
Title: Assistant Vice President
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AGL Resources Inc.,
as Sponsor
By:/s/ J. Michael Riley
-----------------------------------------
Name: J. Michael Riley
Title: Vice President and Chief
Financial Officer
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ANNEX I
TERMS OF
8.17% SERIES A/SERIES B CAPITAL SECURITIES
8.17% COMMON SECURITIES
Pursuant to Section 7.1 of the Amended and Restated
Declaration of Trust, dated as of June 11, 1997 (as amended from time to time,
the "Declaration"), the designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Securities are set out below
(each capitalized term used but not defined herein has the meaning set forth in
the Declaration or, if not defined in such Declaration, as defined in the
Offering Memorandum referred to below in Section 2(c) of this Annex I):
1. Designation and Number.
(a) Capital Securities. 75,000 Series A Capital Securities of
the Trust and 75,000 Series B Capital Securities of the Trust, each series with
an aggregate liquidation amount with respect to the assets of the Trust of
Seventy-Five Million Dollars ($75,000,000), and each with a liquidation amount
with respect to the assets of the Trust of $1,000 per security, are hereby
designated for the purposes of identification only as 8.17% Series A Capital
Securities" and "8.17% Series B Capital Securities", respectively (collectively,
the "Capital Securities"). The certificates evidencing the Capital Securities
shall be substantially in the form of Exhibit A-1 to the Declaration, with such
changes and additions thereto or deletions therefrom as may be required by
ordinary usage, custom or practice or to conform to the rules of any stock
exchange on which the Capital Securities are listed.
(b) Common Securities. 2,320 Common Securities of the Trust
with an aggregate liquidation amount with respect to the assets of the Trust of
Two Million Three Hundred Twenty Thousand Dollars ($2,320,000) and a liquidation
amount with respect to the assets of the Trust of $1,000 per security, are
hereby designated for the purposes of identification only as "8.17% Common
Securities" (the "Common Securities"). The certificates evidencing the Common
Securities shall be substantially in the form of Exhibit A-2 to the Declaration,
with such changes and
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additions thereto or deletions therefrom as may be required by ordinary usage,
custom or practice.
2. Distributions.
(a) Distributions payable on each Security will be fixed at a
rate per annum of 8.17% (the "Coupon Rate") of the liquidation amount of $1,000
per Security (the "Liquidation Amount"), such rate being the rate of interest
payable on the Debentures to be held by the Property Trustee. Distributions in
arrears for more than one semi-annual period will bear additional distributions
thereon compounded semi-annually at the Coupon Rate (to the extent permitted by
applicable law). Pursuant to the Registration Rights Agreement, in certain
limited circumstances the Debenture Issuer will be required to pay Liquidated
Damages (as defined in the Registration Rights Agreement) with respect to the
Debentures. The term "Distributions", as used herein, includes distributions of
any such Liquidated Damages payable unless otherwise stated. A Distribution is
payable only to the extent that payments are made in respect of the Debentures
held by the Property Trustee and to the extent the Property Trustee has funds on
hand legally available therefor.
(b) Distributions on the Securities will be cumulative, will
accumulate from the most recent date to which Distributions have been paid or,
if no Distributions have been paid, from June 11, 1997, and will be payable
semi-annually in arrears on June 1 and December 1 of each year, commencing on
December 1, 1997 (each, a "Distribution Date"), except as otherwise described
below. Distributions will be computed on the basis of a 360-day year consisting
of twelve 30-day months and for any period less than six months on the basis of
the actual number of days elapsed in such period, based on 30-day months. As
long as no Event of Default has occurred and is continuing under the Indenture,
the Debenture Issuer has the right under the Indenture to defer payments of
interest by extending the interest payment period at any time and from time to
time on the Debentures for a period not exceeding 10 consecutive semi-annual
periods, including the first such semi-annual period during such period (each an
"Extension Period"), during which Extension Period no interest shall be due and
payable on the Debentures, provided that no Extension Period shall end in a day
other than an Interest Payment Date for the Debentures or shall extend beyond
the Maturity Date of the Debentures. As a consequence of such deferral,
Distributions will also be deferred. Despite such
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deferral, Distributions will continue to accumulate with additional
Distributions thereon (to the extent permitted by applicable law but not at a
rate greater than the rate at which interest is then accruing on the Debentures)
at the Coupon Rate compounded semi-annually during any such Extension Period.
Prior to the termination of any such Extension Period, the Debenture Issuer may
further defer payments of interest by further extending such Extension Period;
provided that such Extension Period, together with all such previous and further
extensions within such Extension Period, may not exceed 10 consecutive
semi-annual periods, including the first semi-annual period during such
Extension Period, or extend beyond the Maturity Date of the Debentures. Upon the
termination of any Extension Period and the payment of all amounts then due,
subject to the foregoing limitations, the Debenture Issuer may commence a new
Extension Period, subject to the above requirements.
(c) Distributions on the Securities will be payable to the
Holders thereof as they appear on the books and records of the Trust on the 15th
day of the month prior to the month in which the relevant Distribution Date
occurs, which Distribution Dates correspond to the interest payment dates on the
Debentures. Subject to any applicable laws and regulations and the provisions of
the Declaration, each such payment in respect of the Capital Securities will be
made as described under the heading "Description of the Capital Securities --
Form, Denomination, Book-Entry Procedures and Transfer" in the Offering
Memorandum dated June 10, 1997, of the Debenture Issuer and the Trust relating
to the Securities and the Debentures. Payments in respect of Capital Securities
held in certificated form will be made by check mailed to the Holder entitled
thereto. The relevant record dates for the Common Securities shall be the same
as the record dates for the Capital Securities. Distributions payable on any
Securities that are not punctually paid on any Distribution Date, as a result of
the Debenture Issuer having failed to make a payment under the Debentures, will
cease to be payable to the Holder on the relevant record date, and such
defaulted Distribution will instead be payable to the Person in whose name such
Securities are registered on the special record date or other specified date
determined in accordance with the Indenture. If any date on which Distributions
are payable on the Securities is not a Business Day, then payment of the
Distribution payable on such date will be made on the next succeeding day that
is a Business Day (except that if such next succeeding day which is a Business
Day falls in a subsequent
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calendar year, such payment shall be payable on the Business Day next preceding
such date) (and without any interest or other payment in respect of any such
delay), with the same force and effect as if made on such date.
(d) In the event that there is any money or other property
held by or for the Trust that is not accounted for hereunder, such property
shall be distributed Pro Rata (as defined herein) among the Holders of the
Securities.
3. Liquidation Distribution Upon Dissolution.
If a termination occurs as described in Sections 8.1(a)(i),
(ii), (iii), (iv) and (vi), the Trust shall be liquidated by the Trustees as
expeditiously as the Trustees determine to be possible by distributing, after
satisfaction of liabilities to creditors of the Trust as provided by applicable
law, to the holders of the Trust Securities a Like Amount of the Debentures,
unless such distribution is determined by the Property Trustee not to be
practicable, in which event such holders will be entitled to receive out of the
assets of the Trust legally available for distribution to holders, after
satisfaction of liabilities to creditors of the Trust as provided by applicable
law, an amount equal to the aggregate of the Liquidation Amount plus accumulated
and unpaid Distributions thereon to the date of payment (such amount being the
"Liquidation Distribution"). If such Liquidation Distribution can be paid only
in part because the Trust has insufficient assets on hand legally available to
pay in full the aggregate Liquidation Distribution, then the amounts payable
directly by the Trust on the Capital Securities and the Common Securities shall
be paid on a Pro Rata basis.
"Like Amount" means (i) with respect to a redemption of the
Securities, Securities having a Liquidation Amount equal to the principal amount
of Debentures to be paid in accordance with their terms and (ii) with respect to
a distribution of Debentures upon the liquidation of the Trust, Debentures
having a principal amount equal to the Liquidation Amount of the Securities of
the Holder to whom such Debentures are distributed.
4. Redemption and Distribution.
(a) Upon the repayment of the Debentures in whole or in part,
at maturity or upon early redemption (either at the
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option of the Debenture Issuer or pursuant to a Tax Event or an Investment
Company Act Event, each as described below), the proceeds from such repayment
shall be simultaneously applied by the Property Trustee (subject to the Property
Trustee having received notice no later than 45 days prior to such repayment) to
redeem a Like Amount of the Securities at a redemption price equal to (i) in the
case of the repayment of the Debentures at maturity, the Maturity Redemption
Price (as defined below), (ii) in the case of the optional prepayment of the
Debentures upon the occurrence and continuation of a Tax Event or an Investment
Company Act Event, the Special Event Redemption Price (as defined below) and
(iii) in the case of the optional prepayment of the Debentures, the Optional
Redemption Price (as defined below). The Maturity Redemption Price, the Special
Event Redemption Price and the Optional Redemption Price are referred to
collectively as the "Redemption Price". Holders will be given not less than 30
nor more than 60 days notice of such redemption.
(b) (i) The "Maturity Redemption Price", with respect to a
redemption of Securities, shall mean an amount equal to the principal of and
accrued and unpaid interest on the Debentures as of the maturity date thereof.
(ii) In the case of an optional redemption, if fewer than all
the outstanding Securities are to be so redeemed, the Capital Securities will be
redeemed Pro Rata and the Capital Securities to be redeemed will be determined
as described in Section 4(f)(ii) below.
The Debenture Issuer shall have the right (subject to the
conditions in the Indenture) to elect to redeem the Debentures in whole or in
part at any time on or after June 1, 2007 (the "Initial Optional Redemption
Date"), upon not less than 30 days and not more than 60 days notice, at the
Optional Redemption Price and, simultaneous with such redemption, to cause a
Like Amount of the Securities to be redeemed by the Trust at the Optional
Redemption Price on a Pro Rata basis. "Optional Redemption Price" shall mean a
price equal to the percentage of the liquidation amount of Securities to be
redeemed plus accumulated and unpaid Distributions thereon, if any, to the date
of such redemption if redeemed during the 12-month period beginning June 1 of
the years indicated below:
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<TABLE>
<CAPTION>
Year Percentage
---- ----------
<S> <C>
2007 104.085
2008 103.677
2009 103.268
2010 102.860
2011 102.451
2012 102.043
2013 101.634
2014 101.226
2015 100.817
2016 100.409
2017 and thereafter 100.000%
</TABLE>
(c) If a Tax Event or an Investment Company Act Event shall
occur and be continuing, the Debenture Issuer may at its option prepay the
Securities in whole (but not in part) at any time prior to the Initial Optional
Redemption Date, within 90 days of the occurrence of such Tax Event or
Investment Company Act Event (the "90 Day Period") at the Special Event
Prepayment Price (as defined in the Indenture), and, simultaneous with such
prepayment, cause a Like Amount of the Securities to be redeemed by the Trust at
the Special Event Redemption Price on a Pro Rata basis.
"Tax Event" means the receipt by the Sponsor and the Trust of an
opinion of counsel (a "Tax Event Opinion") experienced in such matters to the
effect that, 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, or (b) any official pronouncement or judicial decision interpreting or
applying such laws or regulations by any legislative body, court, governmental
agency or regulatory agency (including the enactment of any legislation and the
publication of any judicial decision or regulatory determination or the issuance
by the Internal Revenue Service of a revenue ruling, revenue procedure, notice
or announcement (which notice or announcement is published in the Internal
Revenue Bulletin) which amendment or change is effective or such pronouncement
or decision is announced on or after June 11, 1997, there is more than an
insubstantial risk that (i) the Trust is, or will be within 90 days of the date
of such Tax Event Opinion,
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subject to United States federal income tax with respect to all or part of the
income received or accrued on the Debentures, (ii) interest payable to the Trust
on the Debentures is not, or within 90 days of the date of the Tax Event Opinion
will not be, deductible by the Debenture Issuer, in whole or in part, for United
States federal income tax purposes or (iii) the Trust is, or will be within 90
days of the date of the Tax Event Opinion, subject to more than a de minimis
amount of other taxes, duties or other governmental charges.
"Investment Company Act Event" shall mean the receipt by AGL
Resources and the Trust of an opinion of counsel experienced in such matters to
the effect that, as a result of the occurrence of a change in law or regulation
or a change in interpretation or application of law or regulation by any
legislative body, court, governmental agency or regulatory authority, there is
more than an unsubstantial risk that the Trust is or will be considered an
"investment company" that is required to be registered under the Investment
Company Act of 1940, as amended, which change becomes effective on or after the
date of original issuance of the Capital Securities.
"Special Event Redemption Price" shall mean, with respect to a
redemption of Securities, for all periods after June 14, 1997 shall be equal to
the greater of (i) 100% of a Like Amount of the Debentures to be prepaid or (ii)
the sum, as determined by a Quotation Agent (as defined in the Indenture), of
the present values of the principal amount and premium payable with respect to
an optional redemption of a Like Amount of the Debentures on June 1, 2007,
together with scheduled payments of interest on a Like Amount of the Debentures
accruing from the prepayment date to and including June 1, 2007 discounted to
the prepayment date on a semi-annual basis (assuming a 360-day year consisting
of twelve 30-day months) at the Adjusted Treasury Rate (as defined in the
Indenture), plus, in each case, accrued interest thereon to the date of
prepayment.
Notwithstanding the foregoing, the Special Event Prepayment Price for
the period through and including June 14, 1997, shall be equal to the greater of
(i) 100% of a Like Amount of the Debentures to be prepaid or (ii) the sum, as
determined by a Quotation Agent, of the present values of the principal amount
and premium payable with respect to an optional redemption of a
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Like Amount of the Debentures on June 1, 2007, together with scheduled payments
of interest on the Junior Subordinated Debentures accruing from the prepayment
date to and including June 1, 2007, discounted to the prepayment date on a
semi-annual basis (assuming a 360-day year consisting of twelve 30-day months)
using the United States Treasury 6 1/2% due November 2026, plus 1.30%.
(d) On and from the date fixed by the Administrative
Trustees for any distribution of Debentures and liquidation of the Trust: (i)
the Securities will no longer be deemed to be outstanding, (ii) the
Clearing Agency or its nominee (or any successor Clearing Agency or its
nominee), as the Holder of the Capital Securities, will receive a registered
global certificate or certificates representing the Debentures to be delivered
upon such distribution and any certificates representing Securities not held by
the Clearing Agency or its nominee (or any successor Clearing Agency or its
nominee) will be deemed to represent beneficial interests in a Like Amount of
Debentures until such certificates are presented to the Debenture Issuer or its
agent for transfer or reissue.
(e) The Trust may not redeem fewer than all the
outstanding Securities unless all accumulated and unpaid Distributions have
been paid on all Securities for all semi-annual Distribution periods
terminating on or before the date of redemption.
(f) The procedure with respect to redemptions or
distributions of Debentures shall be as follows:
(i) Notice of any redemption of, or notice of
distribution of Debentures in exchange for, the Securities (a
"Redemption/Distribution Notice") will be given by the Trust by mail to
each Holder to be redeemed or exchanged not fewer than 30 nor more than
60 days before the date fixed for redemption or exchange thereof which,
in the case of a redemption, will be the date fixed for redemption of
the Debentures. For purposes of the calculation of the date of
redemption or exchange and the dates on which notices are given
pursuant to this Section 4(f)(i), a Redemption/ Distribution Notice
shall be deemed to be given on the day such notice is first mailed by
first-class mail, postage
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prepaid, to Holders. Each Redemption/Distribution Notice shall be
addressed to the Holders of Securities at the address of each such
Holder appearing in the books and records of the Trust. No defect in
the Redemption/Distribution Notice or in the mailing of either thereof
with respect to any Holder shall affect the validity of the redemption
or exchange proceedings with respect to any other Holder.
(ii) In the event that fewer than all the outstanding
Securities are to be redeemed, the Securities to be redeemed shall be
redeemed Pro Rata from each Holder of Securities, it being understood
that, in respect of Capital Securities registered in the name of and
held of record by the Clearing Agency or its nominee (or any successor
Clearing Agency or its nominee), the distribution of the proceeds of
such redemption will be made to the Clearing Agency and disbursed by
such Clearing Agency in accordance with the procedures applied by such
agency or nominee.
(iii) If Securities are to be redeemed and the Trust gives
a Redemption/Distribution Notice, (which notice will be irrevocable),
then (A) with respect to Capital Securities issued in book-entry form,
by 12:00 noon, New York City time, on the redemption date, provided
that the Debenture Issuer has paid the Property Trustee a sufficient
amount of cash in connection with the related redemption or maturity of
the Debentures by 10:00 a.m., New York City time, on the maturity date
or the date of redemption, as the case requires, the Property Trustee
will deposit irrevocably with the Clearing Agency or its nominee (or
successor Clearing Agency or its nominee) funds sufficient to pay the
applicable Redemption Price with respect to such Capital Securities and
will give the Clearing Agency irrevocable instructions and authority to
pay the Redemption Price to the relevant Clearing Agency Participants,
and (B) with respect to Capital Securities issued in certificated form
and Common Securities, provided that the Debenture Issuer has paid the
Property Trustee a sufficient amount of cash in connection with the
related redemption or maturity of the Debentures, the Property Trustee
will pay the relevant Redemption Price to the Holders by check mailed
to the address of the relevant Holder appearing on the books and
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records of the Trust on the Redemption Date. If a
Redemption/Distribution Notice shall have been given and funds
deposited as required, if applicable, then immediately prior to the
close of business on the date of such deposit, or on the redemption
date, as applicable, Distributions will cease to accumulate on the
Securities so called for redemption and all rights of Holders so called
for redemption will cease, except the right of the Holders of such
Securities to receive the Redemption Price, but without interest on
such Redemption Price, and such Securities shall cease to be
outstanding.
(iv) Payment of accumulated and unpaid Distributions on
the Redemption Date of the Securities will be subject to the rights of
Holders of Securities on the close of business on a regular record date
in respect of a Distribution Date occurring on or prior to such
Redemption Date.
Neither the Administrative Trustees nor the Trust shall be
required to register or cause to be registered the transfer of (i) any
Securities beginning on the opening of business 15 days before the day of
mailing of a notice of redemption or any notice of selection of Securities for
redemption or (ii) any Securities selected for redemption except the unredeemed
portion of any Security being redeemed. If any date fixed for redemption of
Securities is not a Business Day, then payment of the Redemption Price payable
on such date will be made on the next succeeding day that is a Business Day
(except that if such next succeeding day which is a Business Day falls in a
subsequent calendar year, such payment shall be payable on the Business Day next
preceding such date) (and without any interest or other payment in respect of
any such delay), with the same force and effect as if made on such date fixed
for redemption. If payment of the Redemption Price in respect of any Securities
is improperly withheld or refused and not paid either by the Property Trustee or
by the Sponsor as guarantor pursuant to the relevant Securities Guarantee,
Distributions on such Securities will continue to accumulate from the original
redemption date to the actual date of payment, in which case the actual payment
date will be considered the date fixed for redemption for purposes of
calculating the Redemption Price.
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(v) Redemption/Distribution Notices shall be sent by the
Property Trustee on behalf of the Trust to (A) in respect of the
Capital Securities, the Clearing Agency or its nominee (or any
successor Clearing Agency or its nominee) if the Global Certificates
have been issued or, if Definitive Capital Security Certificates have
been issued, to the Holder thereof, and (B) in respect of the Common
Securities to the Holder thereof.
(vi) Subject to the foregoing and applicable law
(including, without limitation, United States federal securities laws
and banking laws), provided the acquiror is not the Holder of the
Common Securities or the obligor under the Indenture, the Sponsor or
any of its subsidiaries may at any time and from time to time purchase
outstanding Capital Securities by tender, in the open market or by
private agreement.
5. Voting Rights - Capital Securities.
(a) Except as provided under Sections 5(b) and 7 and as
otherwise required by law and the Declaration, the Holders of the Capital
Securities will have no voting rights.
(b) So long as any Debentures are held by the Property
Trustee, the Trustees shall not (i) direct the time, method and place of
conducting any proceeding for any remedy available to the Debenture Trustee, or
executing any trust or power conferred on such Debenture Trustee with respect to
the Debentures, (ii) waive any past default that is waivable under Section 5.07
of the Indenture, (iii) exercise any right to rescind or annul a declaration of
acceleration of the maturity of the principal of the Debentures or (iv) consent
to any amendment, modification or termination of the Indenture or the
Debentures, where such consent shall be required, without, in each case,
obtaining the prior approval of the Holders of a majority in liquidation amount
of all outstanding Capital Securities; provided, however, that where a consent
under the Indenture would require the consent of each holder of Debentures
affected thereby, no such consent shall be given by the Property Trustee without
the prior approval of each Holder of the Capital Securities. The Trustees shall
not revoke any action previously authorized or approved by a vote of the Holders
of the Capital Securities except by subsequent vote
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of such Holders. The Property Trustee shall notify each Holder of Capital
Securities of any notice of default with respect to the Debentures. In addition
to obtaining the foregoing approvals of such Holders of the Capital Securities,
prior to taking any of the foregoing actions, the Trustees shall obtain an
opinion of counsel experienced in such matters to the effect that the Trust will
not be classified as an association taxable as a corporation for United States
federal income tax purposes on account of such action.
If an Event of Default under the Declaration has occurred and
is continuing and such event is attributable to the failure of the Debenture
Issuer to pay principal of or premium, if any, or interest on the Debentures on
the due date (or in the case of redemption, on the redemption date), then a
Holder of Capital Securities may directly institute a proceeding for enforcement
of payment to such Holder of the principal of or premium, if any, or interest on
a Like Amount of Debentures (a "Direct Action") on or after the respective due
date specified in the Debentures. In connection with such Direct Action, the
rights of the Common Securities Holder will be subrogated to the rights of such
Holder of Capital Securities to the extent of any payment made by the Debenture
Issuer to such Holder of Capital Securities in such Direct Action. Except as
provided in the second preceding sentence, the Holders of Capital Securities
will not be able to exercise directly any other remedy available to the holders
of the Debentures.
Any approval or direction of Holders of Capital Securities may
be given at a separate meeting of Holders of Capital Securities convened for
such purpose, at a meeting of all of the Holders of Securities in the Trust or
pursuant to written consent. The Property Trustees will cause a notice of any
meeting at which Holders of Capital Securities are entitled to vote, or of any
matter upon which action by written consent of such Holders is to be taken, to
be mailed to each Holder of record of Capital Securities. Each such notice will
include a statement setting forth (i) the date of such meeting or the date by
which such action is to be taken, (ii) a description of any resolution proposed
for adoption at such meeting on which such Holders are entitled to vote or of
such matter upon which written consent is sought and (iii) instructions for the
delivery of proxies or consents.
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No vote or consent of the Holders of the Capital Securities
will be required for the Trust to redeem and cancel Capital Securities or to
distribute the Debentures in accordance with the Declaration and the terms of
the Securities.
Notwithstanding that Holders of Capital Securities are
entitled to vote or consent under any of the circumstances described above, any
of the Capital Securities that are owned by the Sponsor or any Affiliate of the
Sponsor shall not be entitled to vote or consent and shall, for purposes of such
vote or consent, be treated as if they were not outstanding.
6. Voting Rights - Common Securities.
(a) Except as provided under Sections 6(b), 6(c), and 7 as
otherwise required by law and the Declaration, the Holders of the Common
Securities will have no voting rights.
(b) Unless a Debenture Event of Default shall have occurred
and be continuing, any Trustee may be removed at any time by the holder of the
Common Securities. If a Debenture Event of Default has occurred and is
continuing, the Property Trustee and the Delaware Trustee may be removed at such
time by the holders of a majority in liquidation amount of the outstanding
Capital Securities. In no event will the holders of the Capital Securities have
the right to vote to appoint, remove or replace the Administrative Trustees,
which voting rights are vested exclusively in the Sponsor as the holder of the
Common Securities. No resignation or removal of a Trustee and no appointment of
a successor trustee shall be effective until the acceptance of appointment by
the successor trustee in accordance with the provisions of the Declaration.
(c) So long as any Debentures are held by the Property
Trustee, the Trustees shall not (i) direct the time, method and place of
conducting any proceeding for any remedy available to the Debenture Trustee, or
executing any trust or power conferred on such Debenture Trustee with respect to
the Debentures, (ii) waive any past default that is waivable under Section 5.07
of the Indenture, (iii) exercise any right to rescind or annul a declaration of
acceleration of the maturity of the principal of the Debentures or (iv) consent
to any amendment, modification or termination of the Indenture or the
Debentures, where such
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consent shall be required, without, in each case, obtaining the prior approval
of the Holders of a majority in liquidation amount of all outstanding Common
Securities; provided, however, that where a consent under the Indenture would
require the consent of each holder of Debentures affected thereby, no such
consent shall be given by the Property Trustee without the prior approval of
each Holder of the Common Securities. The Trustees shall not revoke any action
previously authorized or approved by a vote of the Holders of the Common
Securities except by subsequent vote of such Holders. The Property Trustee shall
notify each Holder of Common Securities of any notice of default with respect to
the Debentures. In addition to obtaining the foregoing approvals of such Holders
of the Common Securities, prior to taking any of the foregoing actions, the
Trustees shall obtain an opinion of counsel experienced in such matters to the
effect that the Trust will not be classified as an association taxable as a
corporation for United States federal income tax purposes on account of such
action.
If an Event of Default under the Declaration has occurred and
is continuing and such event is attributable to the failure of the Debenture
Issuer to pay principal of or premium, if any, or interest on the Debentures on
the due date (or in the case of redemption, on the redemption date), then a
Holder of Common Securities may institute a Direct Action for enforcement of
payment to such Holder of the principal of or premium, if any, or interest on a
Like Amount of Debentures on or after the respective due date specified in the
Debentures. In connection with Direct Action, the rights of the Common
Securities Holder will be subordinated to the rights of such Holder of Capital
Securities to the extent of any payment made by the Debenture Issuer to such
Holder of Common Securities in such Direct Action. Except as provided in the
second preceding sentence, the Holders of Common Securities will not be able to
exercise directly any other remedy available to the holders of the Debentures.
Any approval or direction of Holders of Common Securities may
be given at a separate meeting of Holders of Common Securities convened for such
purpose, at a meeting of all of the Holders of Securities in the Trust or
pursuant to written consent. The Administrative Trustees will cause a notice of
any meeting at which Holders of Common Securities are entitled to vote, or of
any matter upon which action by written consent of
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such Holders is to be taken, to be mailed to each Holder of record of Common
Securities. Each such notice will include a statement setting forth (i) the date
of such meeting or the date by which such action is to be taken, (ii) a
description of any resolution proposed for adoption at such meeting on which
such Holders are entitled to vote or of such matter upon which written consent
is sought and (iii) instructions for the delivery of proxies or consents.
No vote or consent of the Holders of the Common Securities
will be required for the Trust to redeem and cancel Common Securities or to
distribute the Debentures in accordance with the Declaration and the terms of
the Securities.
7. Amendments to Declaration and Indenture.
In addition to the requirements set out in Section 12.1 of the
Declaration, the Declaration may be amended from time to time by the Sponsor,
the Property Trustee and the Administrative Trustees, without the consent of the
Holders of the Securities (i) to cure any ambiguity, correct or supplement any
provisions in the Declaration that may be inconsistent with any other
provisions, or to make any other provisions with respect to matters or questions
arising under the Declaration which shall not be inconsistent with the other
provisions of the Declaration, or (ii) to modify, eliminate or add to any
provisions of the Declaration to such extent as shall be necessary to ensure
that the Trust will be classified for United States federal income tax purposes
as a grantor trust at all times that any Securities are outstanding or to ensure
that the Trust will not be required to register as an "Investment Company" under
the Investment Company Act; provided, however, such action shall not adversely
affect in any material respect the interests of any Holder of Securities, and
any amendments of the Declaration shall become effective when notice thereof is
given to the holders of the Securities. The Declaration may be amended by the
Trustees and the Sponsor with (i) the consent of Holders representing a majority
in liquidation amount of all outstanding Securities, and (ii) receipt by the
Trustees of an Opinion of Counsel to the effect that such amendment or the
exercise of any power granted to the Trustees in accordance with such amendment
will not affect the Trust's status as a grantor trust for United States federal
income tax purposes or the Trust's exemption from status as an Investment
Company
I-15
<PAGE> 109
under the Investment Company Act, provided that, without the consent of each
Holder of Trust Securities, the Declaration may not be amended to (i) change the
amount or timing of any Distribution on the Trust Securities or otherwise
adversely affect the amount of any Distribution required to be made in respect
of the Trust Securities as of a specified date or (ii) restrict the right of a
holder of Trust Securities to institute suit for the enforcement of any such
payment on or after such date.
8. Pro Rata.
A reference in these terms of the Securities to any payment,
distribution or treatment as being "Pro Rata" shall mean pro rata to each Holder
according to the aggregate liquidation amount of the Securities held by the
relevant Holder in relation to the aggregate liquidation amount of all
Securities outstanding unless, in relation to a payment, an Event of Default
under the Declaration has occurred and is continuing, in which case any funds
available to make such payment shall be paid first to each Holder of the Capital
Securities pro rata according to the aggregate liquidation amount of Capital
Securities held by the relevant Holder relative to the aggregate liquidation
amount of all Capital Securities outstanding, and only after satisfaction of all
amounts owed to the Holders of the Capital Securities, to each Holder of Common
Securities pro rata according to the aggregate liquidation amount of Common
Securities held by the relevant Holder relative to the aggregate liquidation
amount of all Common Securities outstanding.
9. Ranking.
The Capital Securities rank pari passu with the Common
Securities and payment thereon shall be made Pro Rata with the Common
Securities, except that, if an Event of Default under the Declaration occurs and
is continuing, no payments in respect of Distributions on, or payments upon
liquidation, redemption or otherwise with respect to, the Common Securities
shall be made until the Holders of the Capital Securities shall be paid in full
the Distributions, Redemption Price, Liquidation Distribution and other payments
to which they are entitled at such time.
I-16
<PAGE> 110
10. Acceptance of Securities Guarantee and Indenture.
Each Holder of Capital Securities and Common Securities, by
the acceptance thereof, agrees to the provisions of the Capital Securities
Guarantee and the Common Securities Guarantee, respectively, including the
subordination provisions therein, and to the provisions of the Indenture.
11. No Preemptive Rights.
The Holders of the Securities shall have no preemptive rights
to subscribe for any additional securities.
12. Miscellaneous.
These terms constitute a part of the Declaration.
The Sponsor will provide a copy of the Declaration, the
Capital Securities Guarantee or the Common Securities Guarantee (as may be
appropriate), the Indenture (including any supplemental indenture) to a Holder
without charge on written request to the Sponsor at its principal place of
business.
I-17
<PAGE> 111
EXHIBIT A-1
FORM OF CAPITAL SECURITY CERTIFICATE
[FORM OF FACE OF SECURITY]
THIS CAPITAL SECURITY IS A GLOBAL CAPITAL SECURITY WITHIN THE
MEANING OF THE DECLARATION HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME
OF THE DEPOSITORY TRUST COMPANY (THE "CLEARING AGENCY") OR A NOMINEE OF THE
CLEARING AGENCY. THIS CAPITAL SECURITY IS EXCHANGEABLE FOR CAPITAL SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE CLEARING AGENCY OR ITS NOMINEE
ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE DECLARATION AND NO TRANSFER
OF THIS CAPITAL SECURITY (OTHER THAN A TRANSFER OF THIS CAPITAL SECURITY AS A
WHOLE BY THE CLEARING AGENCY TO A NOMINEE OF THE CLEARING AGENCY OR BY A NOMINEE
OF THE CLEARING AGENCY TO THE CLEARING AGENCY OR ANOTHER NOMINEE OF THE CLEARING
AGENCY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CAPITAL SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW
YORK) TO THE TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CAPITAL 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.
THE CAPITAL SECURITIES REPRESENTED HEREBY HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT")
OR ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE SECURITIES LAW. NEITHER
THIS CAPITAL SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED,
SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, REGISTRATION.
A1-1
<PAGE> 112
THE HOLDER OF THIS CAPITAL SECURITY BY ITS ACCEPTANCE HEREOF
AGREES TO OFFER, SELL OR OTHERWISE TRANSFER THIS CAPITAL SECURITY, PRIOR TO THE
DATE (THE "RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE
LATER OF THE ORIGINAL ISSUANCE DATE HEREOF AND THE LAST DATE ON WHICH AGL
RESOURCES INC. OR ANY "AFFILIATE" OF AGL RESOURCES INC. WAS THE OWNER OF THIS
CAPITAL SECURITY (OR ANY PREDECESSOR OF THIS CAPITAL SECURITY) ONLY (A) TO AGL
RESOURCES INC., (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT, (C) SO LONG AS THIS CAPITAL SECURITY IS
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE
144A"), TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER"
(AS DEFINED IN RULE 144A) THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT
OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A, (D) TO AN INSTITUTIONAL "ACCREDITED
INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH (A)(1), (2), (3) OR (7) OF RULE 501
OF REGULATION D UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS CAPITAL SECURITY
FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED
INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE
IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (E)
PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS
UNDER THE SECURITIES ACT, SUBJECT TO THE RIGHT OF THE TRUST AND AGL RESOURCES
INC. PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (i) PURSUANT TO CLAUSE (D) OR (E)
TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATIONS AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM, AND (ii) PURSUANT TO CLAUSE (D), TO
REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE REVERSE OF
THIS CAPITAL SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEREE TO THE TRUST.
SUCH HOLDER FURTHER AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS
CAPITAL SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND.
A1-2
<PAGE> 113
$75,000,000
Certificate Number Aggregate Liquidation
Amount of Capital Securities
CUSIP NO. 001196 AA 2
Certificate Evidencing Capital Securities
of
AGL CAPITAL TRUST
75,000
8.17% Series A Capital Securities
(liquidation amount $1,000 per Capital Security)
AGL CAPITAL TRUST, a statutory business trust created under
the laws of the State of Delaware (the "Trust"), hereby certifies that CEDE &
Co. (the "Holder") is the registered owner of 75,000 Capital Securities of the
Trust representing undivided beneficial interests in the assets of the Trust
designated the 8.17% Series A Capital Securities (liquidation amount $1,000 per
Capital Security) (the "Capital Securities"). The Capital Securities are
transferable on the books and records of the Trust, in person or by a duly
authorized attorney, upon surrender of this certificate duly endorsed and in
proper form for transfer. The designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Capital Securities represented
hereby are issued and shall in all respects be subject to the provisions of the
Amended and Restated Declaration of Trust of the Trust dated as of June 11,
1997, as the same may be amended from time to time (the "Declaration"),
including the designation of the terms of the Capital Securities as set forth in
Annex I to the Declaration. Capitalized terms used but not defined herein shall
have the meaning given them in the Declaration. The Sponsor will provide a copy
of the Declaration, the Capital Securities Guarantee and the Indenture to a
Holder without charge upon written request to the Trust at its principal place
of business.
A1-3
<PAGE> 114
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder and to the benefits of
the Capital Securities Guarantee to the extent provided therein.
By acceptance, the Holder agrees to treat, for United States
federal income tax purposes, the Debentures as indebtedness and the Capital
Securities as evidence of indirect beneficial ownership in the Debentures.
IN WITNESS WHEREOF, the Trust has executed this certificate
this 11th day of June, 1997.
AGL CAPITAL TRUST
By:
-----------------------------------------
Name: J. Michael Riley
Administrative Trustee
A1-4
<PAGE> 115
PROPERTY TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Capital Securities referred to in the
within-mentioned Declaration.
Dated: June 11, 1997
THE BANK OF NEW YORK,
as Property Trustee
By:
-------------------------------
Authorized Signatory
A1-5
<PAGE> 116
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Capital Security will be fixed
at a rate per annum of 8.17% (the "Coupon Rate") of the liquidation amount of
$1,000 per Capital Security, such rate being the rate of interest payable on the
Debentures to be held by the Property Trustee. Distributions in arrears for more
than one semi-annual period will bear interest thereon compounded semi-annually
at the Coupon Rate (to the extent permitted by applicable law). Pursuant to the
Registration Rights Agreement, in certain limited circumstances the Debenture
Issuer will be required to pay Liquidated Damages (as defined in the
Registration Rights Agreement) with respect to the Debentures. The term
"Distributions", as used herein, includes such cash distributions and any such
interest and such Liquidated Damages payable unless otherwise stated. A
Distribution is payable only to the extent that payments are made in respect of
the Debentures held by the Property Trustee and to the extent the Property
Trustee has funds on hand legally available therefor.
Distributions on the Capital Securities will be cumulative,
will accumulate from the most recent date to which Distributions have been paid
or, if no Distributions have been paid, from June 11, 1997, and will be payable
semi-annually in arrears, on June 1 and December 1 of each year, commencing on
December 1, 1997, except as otherwise described below. Distributions will be
computed on the basis of a 360-day year consisting of twelve 30-day months and,
for any period less than six months, the number of days elapsed in such period,
based on 30-day months. As long as no Event of Default has occurred and is
continuing under the Indenture, the Debenture Issuer has the right under the
Indenture to defer payments of interest by extending the interest payment period
at any time and from time to time on the Debentures for a period not exceeding
10 consecutive semi-annual periods, including the first such semi-annual period
during such extension period (each an "Extension Period"), provided that no
Extension Period shall extend beyond the Maturity Date of the Debentures. As a
consequence of such deferral, Distributions will also be deferred. Despite such
deferral, semi-annual Distributions will continue to accumulate with interest
thereon (to the extent permitted by applicable law, but not at a rate exceeding
the rate of interest then accruing on the Debentures) at the Coupon Rate
compounded semi-annually
A1-6
<PAGE> 117
during any such Extension Period. Prior to the termination of any such Extension
Period, the Debenture Issuer may further defer payments of interest by further
extending such Extension Period; provided that such Extension Period, together
with all such previous and further extensions within such Extension Period, may
not exceed 10 consecutive semi-annual periods, including the first semi-annual
period during such Extension Period, or extend beyond the Maturity Date of the
Debentures. Payments of accumulated Distributions will be payable to Holders as
they appear on the books and records of the Trust on the first record date after
the end of the Extension Period. Upon the termination of any Extension Period
and the payment of all amounts then due, the Debenture Issuer may commence a new
Extension Period, subject to the above requirements.
Subject to the prior obtaining of any regulatory approval then
required and to certain other conditions set forth in the Declaration and the
Indenture, the Property Trustee may, at the direction of the Sponsor, at any
time liquidate the Trust and cause the Debentures to be distributed to the
holders of the Securities in liquidation of the Trust or, simultaneous with any
redemption of the Debentures, cause a Like Amount of the Securities to be
redeemed by the Trust.
The Capital Securities shall be redeemable as provided in the
Declaration.
A1-7
<PAGE> 118
---------------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Capital Security
Certificate to:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Insert assignee's social security or tax identification number)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Insert address and zip code of assignee)
and irrevocably appoints
________________________________________________________________________________
________________________________________________________________________________
__________________________________________________________________________ agent
to transfer this Capital Security Certificate on the books of the Trust. The
agent may substitute another to act for him or her.
Date: _______________________
Signature:______________________________________________________________________
(Sign exactly as your name appears on the other side of this Capital Security
Certificate)
Signature Guarantee*: _____________________________________________________
- --------------------
* Signature must be guaranteed by an "eligible guarantor institution"
that is a bank, stockbroker, savings and loan association or credit
union meeting the requirements of the Registrar, which requirements
include membership or participation in the Securities Transfer Agents
Medallion Program ("STAMP") or such other "signature guarantee program"
as may be determined by the Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities and
Exchange Act of 1934, as amended.
A1-8
<PAGE> 119
In connection with any transfer of any of the Capital Securities evidenced by
this certificate, the undersigned confirms that such Capital Securities are
being:
CHECK ONE BOX BELOW
(1) [ ] exchanged for the undersigned's own account without
transfer; or
(2) [ ] transferred pursuant to and in compliance with Rule
144A under the Securities Act of 1933; or
(3) [ ] transferred to an institutional "accredited investor"
within the meaning of subparagraph (a)(1), (2), (3)
or (7) of Rule 501 of Regulation D under the
Securities Act of 1933 that is acquiring the Capital
Securities for its own account, or for the account of
such an institutional "accredited investor," for
investment purposes and not with a view to, or for
offer or sale in connection with, any distribution in
violation of the Securities Act of 1933; or
(4) [ ] transferred pursuant to another available exemption
from the registration requirements of the Securities
Act of 1933; or
(5) [ ] transferred pursuant to an effective registration
statement.
Unless one of the boxes is checked, the Exchange Agent will refuse to register
any of the Capital Securities evidenced by this certificate in the name of any
person other than the registered Holder thereof; provided, however, that if box
(3) or (4) is checked, the Registrar may require, prior to registering any such
transfer of the Capital Securities such legal opinions, certifications and other
information as the Trust has reasonably requested to confirm that such transfer
is being made pursuant to an exemption from, or in a transaction not subject to,
the registration requirements of the Securities Act of 1933, as amended, such as
the exemption provided by Rule 144 under such Act; provided, further, that (i)
if box (2) is checked, the
A1-9
<PAGE> 120
transferee must also certify that it is a qualified institutional buyer as
defined in Rule 144A or (ii) if box (3) is checked, the transferee must also
provide to the Registrar a Transferee Letter of Representation in the form
attached to the Offering Memorandum of the Trust dated June 10, 1997; provided,
further, that after the date that a Registration Statement has been filed and so
long as such Registration Statement continues to be effective, the Registrar may
only permit transfers for which box (5) has been checked.
___________________________________
Signature
A1-10
<PAGE> 121
SCHEDULE A*
The initial aggregate liquidation amount of Capital Securities
evidenced by the Certificate to which this Schedule is attached is $75,000,000
(equivalent to 75,000 Capital Securities). The notations on the following table
evidence decreases and increases in the number of Capital Securities evidenced
by such Certificate.
<TABLE>
<CAPTION>
Liquidation
Amount of
Decrease in Increase in Capital
Liquidation Liquidation Securities
Amount of Amount of Remaining After
Capital Capital Such Decrease Notation by
Securities Securities or Increase Registration
- --------------- --------------- ------------------- ----------------
<S> <C> <C> <C>
</TABLE>
- --------------------
* Append to Global Capital Securities only.
A1-11
<PAGE> 122
EXHIBIT A-2
FORM OF COMMON SECURITY CERTIFICATE
THIS COMMON SECURITY MAY NOT BE TRANSFERRED EXCEPT TO THE
SPONSOR OR AN AFFILIATE OF THE SPONSOR.
Certificate Number Number of Common Securities
1 2,320
Certificate Evidencing Common Securities
of
AGL CAPITAL TRUST
8.17% Common Securities
(liquidation amount $1,000 per Common Security)
AGL CAPITAL TRUST, a statutory business trust formed under the
laws of the State of Delaware (the "Trust"), hereby certifies that AGL RESOURCES
INC. (the "Holder") is the registered owner of 2,320 common securities of the
Trust representing undivided beneficial interests in the assets of the Trust
designated the 8.17% Common Securities (liquidation amount $1,000 per Common
Security) (the "Common Securities"). The Common Securities are transferable on
the books and records of the Trust, in person or by a duly authorized attorney,
upon surrender of this certificate duly endorsed and in proper form for
transfer. The designation, rights, privileges, restrictions, preferences and
other terms and provisions of the Common Securities represented hereby are
issued and shall in all respects be subject to the provisions of the Amended and
Restated Declaration of Trust of the Trust dated as of June 11, 1997, as the
same may be amended from time to time (the "Declaration"), including the
designation of the terms of the Common Securities as set forth in Annex I to the
Declaration. Capitalized terms used but not defined herein shall have the
meaning given them in the Declaration. The Sponsor will provide a copy of the
Declaration, the Common Securities Guarantee and the Indenture
A2-1
<PAGE> 123
(including any supplemental indenture) to a Holder without charge upon written
request to the Sponsor at its principal place of business.
Upon receipt of this certificate, the Sponsor is bound by the
Declaration and is entitled to the benefits thereunder and to the benefits of
the Common Securities Guarantee to the extent provided therein.
By acceptance, the Holder agrees to treat, for United States
federal income tax purposes, the Debentures as indebtedness and the Common
Securities as evidence of indirect beneficial ownership in the Debentures.
IN WITNESS WHEREOF, the Trust has executed this certificate
this 11th day of June, 1997.
AGL CAPITAL TRUST
By:
-----------------------------------------
Name: J. Michael Riley
Administrative Trustee
A2-2
<PAGE> 124
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Common Security will be fixed at
a rate per annum of 8.17% (the "Coupon Rate") of the liquidation amount of
$1,000 per Common Security, such rate being the rate of interest payable on the
Debentures to be held by the Property Trustee. Distributions in arrears for more
than one semi-annual period will bear interest thereon compounded semi-annually
at the Coupon Rate (to the extent permitted by applicable law). Pursuant to the
Registration Rights Agreement, in certain limited circumstances the Debenture
Issuer will be required to pay Liquidated Damages (as defined in the
Registration Rights Agreement) with respect to the Debentures. The term
"Distributions", as used herein, includes such cash distributions and any such
interest and such Liquidated Damages payable unless otherwise stated. A
Distribution is payable only to the extent that payments are made in respect of
the Debentures held by the Property Trustee and to the extent the Property
Trustee has funds available therefor.
Distributions on the Common Securities will be cumulative,
will accrue from the most recent date to which Distributions have been paid or,
if no Distributions have been paid, from June 11, 1997 and will be payable
semi-annually in arrears, on June 1 and December 1 of each year, commencing on
December 1, 1997, except as otherwise described below. Distributions will be
computed on the basis of a 360-day year consisting of twelve 30-day months and,
for any period less than six months, the number of days elapsed in such period,
based on 30-day months. As long as no Event of Default has occurred and is
continuing under the Indenture, the Debenture Issuer has the right under the
Indenture to defer payments of interest by extending the interest payment period
at any time and from time to time on the Debentures for a period not exceeding
10 consecutive calendar semi-annual periods, including the first such
semi-annual period during such extension period (each an "Extension Period"),
provided that no Extension Period shall extend beyond the Maturity Date of the
Debentures. As a consequence of such deferral, Distributions will also be
deferred. Despite such deferral, Distributions will continue to accumulate with
interest thereon (to the extent permitted by applicable law, but not at a rate
exceeding the rate of interest then accruing on the Debentures) at the Coupon
Rate compounded
A2-3
<PAGE> 125
semi-annually during any such Extension Period. Prior to the termination of any
such Extension Period, the Debenture Issuer may further defer payments of
interest by further extending such Extension Period; provided that such
Extension Period, together with all such previous and further extensions within
such Extension Period, may not exceed 10 consecutive semi-annual periods,
including the first semi-annual period during such Extension Period, or extend
beyond the Maturity Date of the Debentures. Payments of accrued Distributions
will be payable to Holders as they appear on the books and records of the Trust
on the first record date after the end of the Extension Period. Upon the
termination of any Extension Period and the payment of all amounts then due, the
Debenture Issuer may commence a new Extension Period, subject to the above
requirements.
Subject to the Sponsor obtaining any regulatory prior approval
then required and to certain other conditions set forth in the Declaration and
the Indenture, the Property Trustee may, at the direction of the Sponsor, at any
time liquidate the Trust and cause the Debentures to be distributed to the
holders of the Securities in liquidation of the Trust or, simultaneous with any
redemption of the Debentures, cause a Like Amount of the Securities to be
redeemed by the Trust.
The Common Securities shall be redeemable as provided in the
Declaration.
A2-4
<PAGE> 126
---------------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Common Security
Certificate to:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Insert assignee's social security or tax identification number)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Insert address and zip code of assignee)
and irrevocably appoints _______________________________________________________
_________________________________________________ agent to transfer this Common
Security Certificate on the books of the Trust. The agent may substitute another
to act for him or her.
Date: _______________________
Signature: _____________________________________________________________________
(Sign exactly as your name appears on the other side of this Common Security
Certificate)
Signature Guarantee*: _____________________________________________________
- --------------------
* Signature must be guaranteed by an "eligible guarantor institution"
that is a bank, stockbroker, savings and loan association or credit
union meeting the requirements of the Registrar, which requirements
include membership or participation in the Securities Transfer Agents
Medallion Program ("STAMP") or such other "signature guarantee program"
as may be determined by the Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities and
Exchange Act of 1934, as amended.
A2-5
<PAGE> 127
In connection with any transfer of any of the Common Securities evidenced by
this certificate, the undersigned confirms that such Common Securities are
being:
CHECK ONE BOX BELOW
(1) [ ] exchanged for the undersigned's own account without
transfer; or
(2) [ ] transferred pursuant to and in compliance with Rule
144A under the Securities Act of 1933; or
(3) [ ] transferred pursuant to and in compliance with
Regulation S under the Securities Act of 1933; or
(4) [ ] to an institutional "accredited investor" within the
meaning of subparagraph (a)(1), (2), (3) or (7) of
Rule 501 of Regulation D under the Securities Act
that is acquiring the Preferred Security for its own
account, or for the account of such an institutional
"accredited investor," for investment purposes and
not with a view to, or for offer or sale in
connection with, any distribution in violation of the
Securities Act; or
(5) [ ] transferred pursuant to another available exemption
from the registration requirements of the Securities
Act of 1933; or
(6) [ ] transferred pursuant to an effective Registration
Statement.
Unless one of the boxes is checked, the Exchange Agent will refuse to register
any of the Common Securities evidenced by this certificate in the name of any
person other than the registered Holder thereof; provided, however, that if box
(3), (4) or (5) is checked, the Exchange Agent may require, prior to registering
any such transfer of the Preferred Securities such legal opinions,
certifications and other information as the Trust has reasonably requested to
confirm that such transfer is being made pursuant to
A2-6
<PAGE> 128
an exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act of 1933, such as the exemption provided by
Rule 144 under such Act; provided, further, that (i) if box 2 is checked, the
transferee must also certify that it is a qualified institutional buyer as
defined in Rule 144A or (ii) if box 4 is checked, the transferee must also
provide a Transferee Representation Letter in the form attached to the Offering
Memorandum of the Trust, dated June 10, 1997, after the date that a Registration
Statement has been filed and so long as such Registration Statement continues to
be effective, the Exchange Agent may only permit transfers for which box (5) has
been checked.
-------------------------------------
Signature
A2-7
<PAGE> 1
EXHIBIT 4.6
SERIES A CAPITAL SECURITIES GUARANTEE AGREEMENT
AGL RESOURCES INC.
DATED AS OF JUNE 11, 1997
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation................................... 2
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application................................. 6
SECTION 2.2 Lists of Holders of Securities................................... 6
SECTION 2.3 Reports by the Capital Securities Guarantee Trustee.............. 6
SECTION 2.4 Periodic Reports to Capital Securities Guarantee Trustee......... 6
SECTION 2.5 Evidence of Compliance with Conditions Precedent................. 7
SECTION 2.6 Events of Default; Waiver........................................ 7
SECTION 2.7 Event of Default; Notice......................................... 7
SECTION 2.8 Conflicting Interests............................................ 8
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
CAPITAL SECURITIES GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Capital Securities Guarantee Trustee.... 8
SECTION 3.2 Certain Rights of Capital Securities Guarantee Trustee........... 10
SECTION 3.3 Not Responsible for Recitals or Issuance of Series A Capital
Securities Guarantee............................................. 12
ARTICLE IV
CAPITAL SECURITIES GUARANTEE TRUSTEE
SECTION 4.1 Capital Securities Guarantee Trustee; Eligibility................ 12
SECTION 4.2 Appointment, Removal and Resignation of Capital Securities
Guarantee Trustee................................................ 13
</TABLE>
i
<PAGE> 3
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ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee........................................................ 14
SECTION 5.2 Waiver of Notice and Demand...................................... 14
SECTION 5.3 Obligations Not Affected......................................... 14
SECTION 5.4 Rights of Holders................................................ 15
SECTION 5.5 Guarantee of Payment............................................. 16
SECTION 5.6 Subrogation...................................................... 16
SECTION 5.7 Independent Obligations.......................................... 16
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions....................................... 16
SECTION 6.2 Ranking.......................................................... 17
ARTICLE VII
TERMINATION
SECTION 7.1 Termination...................................................... 17
ARTICLE VIII
COMPENSATION AND EXPENSES OF
CAPITAL SECURITIES GUARANTEE TRUSTEE...................... 18
ARTICLE IX
INDEMNIFICATION
SECTION 9.1 Exculpation...................................................... 19
SECTION 9.2 Indemnification.................................................. 19
ARTICLE X
MISCELLANEOUS
SECTION 10.1 Successors and Assigns........................................... 20
SECTION 10.2 Amendments....................................................... 20
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SECTION 10.3 Notices.......................................................... 20
SECTION 10.4 Exchange Offer................................................... 21
SECTION 10.5 Benefit.......................................................... 21
SECTION 10.6 Governing Law.................................................... 22
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SERIES A CAPITAL SECURITIES GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (the "Series A Capital Securities
Guarantee"), dated as of June 11, 1997, is executed and delivered by AGL
Resources Inc., a Georgia corporation (the "Guarantor"), and The Bank of New
York, a New York banking corporation, as trustee (the "Capital Securities
Guarantee Trustee"), for the benefit of the Holders (as defined herein) from
time to time of the Series A Capital Securities (as defined herein) of AGL
Capital Trust, a Delaware statutory business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of
Trust (the "Declaration"), dated as of June 11, 1997, among the trustees of the
Issuer, the Guarantor, as sponsor, and the holders from time to time of
undivided beneficial interests in the assets of the Issuer, the Issuer is
issuing on the date hereof 75,000 Series A capital securities, having an
aggregate liquidation amount of $75,000,000, such capital securities being
designated the 8.17% Series A Capital Securities (collectively the "Series A
Capital Securities") and, in connection with an Exchange Offer (as defined in
the Declaration) has agreed to execute and deliver the Series B Capital
Securities Guarantee (as defined in the Declaration) for the benefit of holders
of the Series B Capital Securities (as defined in the Declaration).
WHEREAS, as incentive for the Holders to purchase the Series A
Capital Securities, the Guarantor desires irrevocably and unconditionally to
agree, to the extent set forth in this Series A Capital Securities Guarantee, to
pay to the Holders the Guarantee Payments (as defined below). The Guarantor
agrees to make certain other payments on the terms and conditions set forth
herein.
WHEREAS, the Guarantor is executing and delivering a guarantee
agreement (the "Common Securities Guarantee"), with substantially identical
terms to this Series A Capital Securities Guarantee, for the benefit of the
holders of the Common Securities (as defined herein), except that if an Event of
Default (as defined in the Declaration) has occurred and is continuing, the
rights of holders of the Common Securities to receive Guarantee Payments under
the Common Securities Guarantee are subordinated, to the extent and in the
manner set forth in the Common Securities Guarantee, to the rights of holders of
Series A Capital Securities and the Series B Capital Securities to receive
Guarantee Payments under this Series A Capital Securities Guarantee and the
Series B Capital Securities Guarantee, as the case may be.
NOW, THEREFORE, in consideration of the purchase by each
Holder, which purchase the Guarantor hereby acknowledges shall benefit the
Guarantor, the Guarantor executes and delivers this Series A Capital Securities
Guarantee for the benefit of the Holders.
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ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation
In this Series A Capital Securities Guarantee, unless the
context otherwise requires:
(a) Capitalized terms used in this Series A Capital
Securities Guarantee but not defined in the preamble
above have the respective meanings assigned to them
in this Section 1.1;
(b) Terms defined in the Declaration as of the date of
execution of this Series A Capital Securities
Guarantee have the same meaning when used in this
Series A Capital Securities Guarantee unless
otherwise defined in this Series A Capital Securities
Guarantee;
(c) a term defined anywhere in this Series A Capital
Securities Guarantee has the same meaning throughout;
(d) all references to "the Series A Capital Securities
Guarantee" or "this Series A Capital Securities
Guarantee" are to this Series A Capital Securities
Guarantee as modified, supplemented or amended from
time to time;
(e) all references in this Series A Capital Securities
Guarantee to Articles and Sections are to Articles
and Sections of this Series A Capital Securities
Guarantee, unless otherwise specified;
(f) a term defined in the Trust Indenture Act has the
same meaning when used in this Series A Capital
Securities Guarantee, unless otherwise defined in
this Series A Capital Securities Guarantee or unless
the context otherwise requires; and
(g) a reference to the singular includes the plural and
vice versa.
"Affiliate" has the same meaning as given to that term in Rule
405 under the Securities Act of 1933, as amended, or any successor rule
thereunder.
"Business Day" means any day other than a Saturday or a
Sunday, or a day on which banking institutions in The City of New York are
authorized or required by law or executive order to close.
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"Capital Securities Guarantee Trustee" means The Bank of New
York, a New York banking corporation, until a Successor Capital Securities
Guarantee Trustee has been appointed and has accepted such appointment pursuant
to the terms of this Series A Capital Securities Guarantee and thereafter means
each such Successor Capital Securities Guarantee Trustee.
"Common Securities" means the securities representing common
undivided beneficial interests in the assets of the Issuer.
"Corporate Trust Office" means the office of the Capital
Securities Guarantee Trustee at which the corporate trust business of the
Capital Securities Guarantee Trustee shall, at any particular time, be
principally administered, which office at the date of execution of this
Agreement is located at 101 Barclay Street, 21 West, New York, New York 10286.
"Covered Person" means any Holder or beneficial owner of
Series A Capital Securities.
"Debentures" means the series of subordinated debt securities
of the Guarantor designated the 8.17% Series A Junior Subordinated Deferrable
Interest Debentures due June 1, 2037 held by the Property Trustee (as defined in
the Declaration) of the Issuer.
"Event of Default" means a default by the Guarantor on any of
its payment or other obligations under this Series A Capital Securities
Guarantee.
"Guarantee Payments" means the following payments or
distributions, without duplication, with respect to the Series A Capital
Securities, to the extent not paid or made by the Issuer: (i) any accumulated
and unpaid Distributions (as defined in the Declaration) that are required to be
paid on such Series A Capital Securities to the extent the Issuer has funds on
hand legally available therefor at such time, (ii) the redemption price,
including all accumulated and unpaid Distributions to the date of redemption
(the "Redemption Price") to the extent the Issuer has funds on hand legally
available therefor at such time, with respect to any Series A Capital Securities
called for redemption by the Issuer, and (iii) upon a voluntary or involuntary
termination and liquidation of the Issuer (other than in connection with the
distribution of Debentures to the Holders in exchange for Series A Capital
Securities as provided in the Declaration), the lesser of (a) the aggregate of
the liquidation amount and all accumulated and unpaid Distributions on the
Series A Capital Securities to the date of payment, to the extent the Issuer has
funds on hand legally available therefor, and (b) the amount of assets of the
Issuer remaining available for distribution to Holders in liquidation of the
Issuer. If an Event of Default has occurred and is continuing, no Guarantee
Payments under the Common Securities Guarantee with respect to the Common
Securities or any guarantee payment under any Other Common Securities Guarantees
shall be made until the Holders shall be paid in full the Guarantee Payments to
which they are entitled under this Series A Capital Securities Guarantee.
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"Holder" shall mean any holder, as registered on the books and
records of the Issuer, of any Series A Capital Securities; provided, however,
that, in determining whether the holders of the requisite percentage of Series A
Capital Securities have given any request, notice, consent or waiver hereunder,
"Holder" shall not include the Guarantor or any Affiliate of the Guarantor.
"Indemnified Person" means the Capital Securities Guarantee
Trustee, any Affiliate of the Capital Securities Guarantee Trustee, or any
officers, directors, shareholders, members, partners, employees,
representatives, nominees, custodians or agents of the Capital Securities
Guarantee Trustee.
"Indenture" means the Indenture dated as of June 11, 1997,
among the Guarantor (the "Debenture Issuer") and The Bank of New York, as
trustee (the "Property Trustee"), pursuant to which the Debentures are to be
issued to the Property Trustee of the Issuer.
"Indenture Event of Default" shall mean any event specified in
Section 5.01 of the Indenture.
"Majority in liquidation amount of the Series A Capital
Securities" means, except as provided by the Trust Indenture Act, a vote by
Holder(s) of more than 50% of the aggregate liquidation amount (including the
stated amount that would be paid on redemption, liquidation or otherwise, plus
accumulated and unpaid Distributions to the date upon which the voting
percentages are determined) of all Series A Capital Securities.
"Officers' Certificate" means, with respect to any person, a
certificate signed by the Chairman, the Chief Executive Officer, the President,
a Vice President, the Controller, the Secretary or an Assistant Secretary, the
Treasurer or an Assistant Treasurer of the Guarantor. Any Officers' Certificate
delivered with respect to compliance with a condition or covenant provided for
in this Series A Capital Securities Guarantee (other than pursuant to Section
314(d)(4) of the Trust Indenture Act) shall include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions
relating thereto;
(b) a statement that each such officer has made such
examination or investigation as, in such officer's opinion, is
necessary to enable such officer to express an informed opinion as to
whether or not such covenant or condition has been complied with; and
(c) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
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"Other Common Securities Guarantees" shall have the same
meaning as "Other Guarantees" in the Common Securities Guarantee.
"Other Debentures" means all junior subordinated debentures
issued by the Guarantor from time to time and sold to trusts to be established
by the Guarantor (if any), in each case similar to the Issuer.
"Other Guarantees" means all guarantees to be issued by the
Guarantor with respect to capital securities (if any) similar to the Series A
Capital Securities issued by other trusts to be established by the Guarantor (if
any), in each case similar to the Issuer.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of June 11, 1997, by and among the Guarantor, the Issuer and
the Initial Purchasers named therein as such agreement may be amended, modified
or supplemented from time to time.
"Responsible Officer" means, with respect to the Capital
Securities Guarantee Trustee, any officer within the Corporate Trust Office of
the Capital Securities Guarantee Trustee, including any vice president, any
assistant vice president, any assistant secretary, the treasurer, any assistant
treasurer, any trust officer, any senior trust officer or other officer in the
Corporate Trust Office of the Capital Securities Guarantee Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of that officer's
knowledge of and familiarity with the particular subject.
"Successor Capital Securities Guarantee Trustee" means a
successor Capital Securities Guarantee Trustee possessing the qualifications to
act as Capital Securities Guarantee Trustee under Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended.
"Trust Securities" means the Common Securities and the Series
A Capital Securities and Series B Capital Securities, collectively.
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ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application
(a) This Series A Capital Securities Guarantee is subject to
the provisions of the Trust Indenture Act that are required to be part of this
Series A Capital Securities Guarantee and shall, to the extent applicable, be
governed by such provisions; and
(b) if and to the extent that any provision of this Series A
Capital Securities Guarantee limits, qualifies or conflicts with the duties
imposed by Section 310 to 317, inclusive, of the Trust Indenture Act, such
imposed duties shall control.
SECTION 2.2 Lists of Holders of Securities
(a) The Guarantor shall provide the Capital Securities Guarantee
Trustee (unless the Capital Securities Guarantee Trustee is otherwise the
registrar of the Capital Securities) with a list, in such form as the Capital
Securities Guarantee Trustee may reasonably require, of the names and addresses
of the Holders ("List of Holders") as of such date, (i) within 14 days after
each record date for payment of Distributions, and (ii) at any other time within
30 days of receipt by the Guarantor of a written request for a List of Holders
as of a date no more than 14 days before such List of Holders is given to the
Capital Securities Guarantee Trustee provided, that the Guarantor shall not be
obligated to provide such List of Holders at any time the List of Holders does
not differ from the most recent List of Holders given to the Capital Securities
Guarantee Trustee by the Guarantor. The Capital Securities Guarantee Trustee may
destroy any List of Holders previously given to it on receipt of a new List of
Holders.
(b) The Capital Securities Guarantee Trustee shall comply with
its obligations under Sections 311(a), 311(b) and Section 312(b) of the Trust
Indenture Act.
SECTION 2.3 Reports by the Capital Securities Guarantee Trustee
Within 60 days after May 15 of each year, commencing May 15,
1998, the Capital Securities Guarantee Trustee shall provide to the Holders such
reports as are required by Section 313(a) of the Trust Indenture Act, if any, in
the form and in the manner provided by Section 313 of the Trust Indenture Act.
The Capital Securities Guarantee Trustee shall also comply with the other
requirements of Section 313 of the Trust Indenture Act.
SECTION 2.4 Periodic Reports to Capital Securities Guarantee Trustee
The Guarantor shall provide to the Capital Securities
Guarantee Trustee such documents, reports and information as required by Section
314 (if any) and the compliance certificate required by Section 314 of the Trust
Indenture Act in the form, in the manner and at
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the times required by Section 314 of the Trust Indenture Act provided that such
compliance certificate shall be delivered on or before 120 days after the end of
each fiscal year of the Guarantor. Delivery of such reports, information and
documents to the Capital Securities Guarantee Trustee is for informational
purposes only and the Capital Securities Guarantee Trustee's receipt of such
shall not constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Guarantor's
compliance with any of its covenants hereunder (as to which the Capital
Securities Guarantee Trustee is entitled to rely exclusively on Officers'
Certificates).
SECTION 2.5 Evidence of Compliance with Conditions Precedent
The Guarantor shall provide to the Capital Securities
Guarantee Trustee such evidence of compliance with any conditions precedent, if
any, provided for in this Series A Capital Securities Guarantee that relate to
any of the matters set forth in Section 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given by an officer pursuant to Section
314(c)(1) may be given in the form of an Officers' Certificate.
SECTION 2.6 Events of Default; Waiver
The Holders of a Majority in liquidation amount of Series A
Capital Securities may, by vote, on behalf of all the Holders, waive any past
Event of Default and its consequences. Upon such waiver, any such Event of
Default shall cease to exist, and any Event of Default arising therefrom shall
be deemed to have been cured, for every purpose of this Series A Capital
Securities Guarantee, but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent thereon.
SECTION 2.7 Event of Default; Notice
(a) The Capital Securities Guarantee Trustee shall, within 90
days after the occurrence of a default with respect to this Capital Securities
Guarantee, mail by first class postage prepaid, to all Holders, notices of all
defaults actually known to a Responsible Officer of the Capital Securities
Guarantee Trustee, unless such defaults have been cured before the giving of
such notice, provided, that, except in the case of default in the payment of any
Guarantee Payment, the Capital Securities Guarantee Trustee shall be protected
in withholding such notice if and so long as the board of directors, the
executive committee, or a trust committee of directors and/or Responsible
Officers of the Capital Securities Guarantee Trustee in good faith determines
that the withholding of such notice is in the interests of the holders of the
Series A Capital Securities.
(b) The Capital Securities Guarantee Trustee shall not be
deemed to have knowledge of any Event of Default unless the Capital Securities
Guarantee Trustee shall have received written notice from the Guarantor or a
Holder, or a Responsible Officer of the Capital
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Securities Guarantee Trustee charged with the administration of the Declaration
shall have obtained actual knowledge, of such Event of Default.
SECTION 2.8 Conflicting Interests
The Declaration shall be deemed to be specifically described
in this Series A Capital Securities Guarantee for the purposes of clause (i) of
the first proviso contained in Section 310(b) of the Trust Indenture Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
CAPITAL SECURITIES GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Capital Securities Guarantee Trustee
(a) This Series A Capital Securities Guarantee shall be held
by the Capital Securities Guarantee Trustee for the benefit of the Holders, and
the Capital Securities Guarantee Trustee shall not transfer this Series A
Capital Securities Guarantee to any Person except a Holder exercising his or her
rights pursuant to Section 5.4(b) or to a Successor Capital Securities Guarantee
Trustee on acceptance by such Successor Capital Securities Guarantee Trustee of
its appointment to act as Successor Capital Securities Guarantee Trustee. The
right, title and interest of the Capital Securities Guarantee Trustee shall
automatically vest in any Successor Capital Securities Guarantee Trustee, and
such vesting and succession of title shall be effective whether or not
conveyancing documents have been executed and delivered pursuant to the
appointment of such Successor Capital Securities Guarantee Trustee.
(b) If an Event of Default actually known to a Responsible
Officer of the Capital Securities Guarantee Trustee has occurred and is
continuing, the Capital Securities Guarantee Trustee shall enforce this Series A
Capital Securities Guarantee for the benefit of the Holders.
(c) The Capital Securities Guarantee Trustee, before the
occurrence of any Event of Default and after the curing of all Events of Default
that may have occurred, shall undertake to perform only such duties as are
specifically set forth in this Series A Capital Securities Guarantee, and no
implied covenants shall be read into this Series A Capital Securities Guarantee
against the Capital Securities Guarantee Trustee. In case an Event of Default
has occurred (that has not been cured or waived pursuant to Section 2.6) and is
actually known to a Responsible Officer of the Capital Securities Guarantee
Trustee, the Capital Securities Guarantee Trustee shall exercise such of the
rights and powers vested in it by this Series A Capital Securities Guarantee,
and use the same degree of care and skill in its exercise thereof, as a prudent
person would exercise or use under the circumstances in the conduct of his or
her own affairs.
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(d) No provision of this Series A Capital Securities Guarantee
shall be construed to relieve the Capital Securities Guarantee Trustee from
liability for its own negligent action, its own negligent failure to act, or its
own willful misconduct, except that:
(i) prior to the occurrence of any Event of Default and
after the curing or waiving of all such Events of Default that may have
occurred:
(A) the duties and obligations of the Capital
Securities Guarantee Trustee shall be determined solely by the
express provisions of this Series A Capital Securities
Guarantee, and the Capital Securities Guarantee Trustee shall
not be liable except for the performance of such duties and
obligations as are specifically set forth in this Series A
Capital Securities Guarantee, and no implied covenants or
obligations shall be read into this Series A Capital
Securities Guarantee against the Capital Securities Guarantee
Trustee; and
(B) in the absence of bad faith on the part of the
Capital Securities Guarantee Trustee, the Capital Securities
Guarantee Trustee may conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed
therein, upon any certificates or opinions furnished to the
Capital Securities Guarantee Trustee and conforming to the
requirements of this Series A Capital Securities Guarantee;
but in the case of any such certificates or opinions that by
any provision hereof are specifically required to be furnished
to the Capital Securities Guarantee Trustee, the Capital
Securities Guarantee Trustee shall be under a duty to examine
the same to determine whether or not they conform to the
requirements of this Series A Capital Securities Guarantee;
(ii) the Capital Securities Guarantee Trustee shall not be
liable for any error of judgment made in good faith by a Responsible
Officer of the Capital Securities Guarantee Trustee, unless it shall be
proved that the Capital Securities Guarantee Trustee was negligent in
ascertaining the pertinent facts upon which such judgment was made;
(iii) the Capital Securities Guarantee Trustee shall not be
liable with respect to any action taken or omitted to be taken by it in
good faith in accordance with the direction of the Holders of a
Majority in liquidation amount of the Series A Capital Securities
relating to the time, method and place of conducting any proceeding for
any remedy available to the Capital Securities Guarantee Trustee, or
exercising any trust or power conferred upon the Capital Securities
Guarantee Trustee under this Series A Capital Securities Guarantee; and
(iv) no provision of this Series A Capital Securities
Guarantee shall require the Capital Securities Guarantee Trustee to
expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of
any of its rights or powers, if the Capital Securities Guarantee
Trustee shall have reasonable
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grounds for believing that the repayment of such funds or liability is
not reasonably assured to it under the terms of this Series A Capital
Securities Guarantee or indemnity, reasonably satisfactory to the
Capital Securities Guarantee Trustee, against such risk or liability is
not reasonably assured to it.
SECTION 3.2 Certain Rights of Capital Securities Guarantee Trustee
(a) Subject to the provisions of Section 3.1:
(i) The Capital Securities Guarantee Trustee may conclusively
rely, and shall be fully protected in acting or refraining from acting,
upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed, sent or presented
by the proper party or parties.
(ii) Any direction or act of the Guarantor contemplated by
this Series A Capital Securities Guarantee may be sufficiently
evidenced by an Officers' Certificate.
(iii) Whenever, in the administration of this Series A Capital
Securities Guarantee, the Capital Securities Guarantee Trustee shall
deem it desirable that a matter be proved or established before taking,
suffering or omitting any action hereunder, the Capital Securities
Guarantee Trustee (unless other evidence is herein specifically
prescribed) may, in the absence of bad faith on its part, request and
conclusively rely upon an Officers' Certificate which, upon receipt of
such request, shall be promptly delivered by the Guarantor.
(iv) The Capital Securities Guarantee Trustee shall have no
duty to see to any recording, filing or registration of any instrument
(or any rerecording, refiling or registration thereof).
(v) The Capital Securities Guarantee Trustee may consult with
counsel of its selection, and the advice or opinion of such counsel
with respect to legal matters shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted by
it hereunder in good faith and in accordance with such advice or
opinion. Such counsel may be counsel to the Guarantor or any of its
Affiliates and may include any of its employees. The Capital Securities
Guarantee Trustee shall have the right at any time to seek instructions
concerning the administration of this Series A Capital Securities
Guarantee from any court of competent jurisdiction.
(vi) The Capital Securities Guarantee Trustee shall be under
no obligation to exercise any of the rights or powers vested in it by
this Series A Capital Securities Guarantee at the request or direction
of any Holder, unless such Holder shall have provided to the Capital
Securities Guarantee Trustee such security and indemnity,
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reasonably satisfactory to the Capital Securities Guarantee Trustee,
against the costs, expenses (including attorneys' fees and expenses and
the expenses of the Capital Securities Guarantee Trustee's agents,
nominees or custodians) and liabilities that might be incurred by it in
complying with such request or direction, including such reasonable
advances as may be requested by the Capital Securities Guarantee
Trustee; provided that, nothing contained in this Section 3.2(a)(vi)
shall be taken to relieve the Capital Securities Guarantee Trustee,
upon the occurrence of an Event of Default, of its obligation to
exercise the rights and powers vested in it by this Series A Capital
Securities Guarantee.
(vii) The Capital Securities Guarantee Trustee shall not be
bound to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document, but the
Capital Securities Guarantee Trustee, in its discretion, may make such
further inquiry or investigation into such facts or matters as it may
see fit.
(viii) The Capital Securities Guarantee Trustee may execute
any of the trusts or powers hereunder or perform any duties hereunder
either directly or by or through agents, nominees, custodians or
attorneys, and the Capital Securities Guarantee Trustee shall not be
responsible for any misconduct or negligence on the part of any agent
or attorney appointed with due care by it hereunder.
(ix) Any action taken by the Capital Securities Guarantee
Trustee or its agents hereunder shall bind the Holders, and the
signature of the Capital Securities Guarantee Trustee or its agents
alone shall be sufficient and effective to perform any such action. No
third party shall be required to inquire as to the authority of the
Capital Securities Guarantee Trustee to so act or as to its compliance
with any of the terms and provisions of this Series A Capital
Securities Guarantee, both of which shall be conclusively evidenced by
the Capital Securities Guarantee Trustee's or its agent's taking such
action.
(x) Whenever in the administration of this Series A Capital
Securities Guarantee the Capital Securities Guarantee Trustee shall
deem it desirable to receive instructions with respect to enforcing any
remedy or right or taking any other action hereunder, the Capital
Securities Guarantee Trustee (i) may request instructions from the
Holders of a Majority in liquidation amount of the Series A Capital
Securities, (ii) may refrain from enforcing such remedy or right or
taking such other action until such instructions are received, and
(iii) shall be protected in conclusively relying on or acting in
accordance with such instructions.
(xi) The Capital Securities Guarantee Trustee shall not be
liable for any action taken, suffered, or omitted to be taken by it in
good faith, without negligence, and reasonably believed by it to be
authorized or within the discretion or rights or powers conferred upon
it by this Series A Capital Securities Guarantee.
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(b) No provision of this Series A Capital Securities Guarantee
shall be deemed to impose any duty or obligation on the Capital Securities
Guarantee Trustee to perform any act or acts or exercise any right, power, duty
or obligation conferred or imposed on it in any jurisdiction in which it shall
be illegal, or in which the Capital Securities Guarantee Trustee shall be
unqualified or incompetent in accordance with applicable law, to perform any
such act or acts or to exercise any such right, power, duty or obligation. No
permissive power or authority available to the Capital Securities Guarantee
Trustee shall be construed to be a duty.
SECTION 3.3. Not Responsible for Recitals or Issuance of Series A Capital
Securities Guarantee
The recitals contained in this Series A Capital Securities
Guarantee shall be taken as the statements of the Guarantor, and the Capital
Securities Guarantee Trustee does not assume any responsibility for their
correctness. The Capital Securities Guarantee Trustee makes no representation as
to the validity or sufficiency of this Series A Capital Securities Guarantee.
ARTICLE IV
CAPITAL SECURITIES GUARANTEE TRUSTEE
SECTION 4.1 Capital Securities Guarantee Trustee; Eligibility
(a) There shall at all times be a Capital Securities Guarantee
Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under
the laws of the United States of America or any State or Territory
thereof or of the District of Columbia, or a corporation or Person
permitted by the Securities and Exchange Commission to act as an
institutional trustee under the Trust Indenture Act, authorized under
such laws to exercise corporate trust powers, having a combined capital
and surplus of at least 50 million U.S. dollars ($50,000,000), and
subject to supervision or examination by Federal, State, Territorial or
District of Columbia authority. If such corporation publishes reports
of condition at least annually, pursuant to law or to the requirements
of the supervising or examining authority referred to above, then, for
the purposes of this Section 4.1(a)(ii), the combined capital and
surplus of such corporation shall be deemed to be its combined capital
and surplus as set forth in its most recent report of condition so
published.
(b) If at any time the Capital Securities Guarantee Trustee
shall cease to be eligible to so act under Section 4.1(a), the Capital
Securities Guarantee Trustee shall immediately resign in the manner and with the
effect set out in Section 4.2(c).
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(c) If the Capital Securities Guarantee Trustee has or shall
acquire any "conflicting interest" within the meaning of Section 310(b) of the
Trust Indenture Act, the Capital Securities Guarantee Trustee and Guarantor
shall in all respects comply with the provisions of Section 310(b) of the Trust
Indenture Act, subject to the penultimate paragraph thereof.
SECTION 4.2 Appointment, Removal and Resignation of Capital Securities
Guarantee Trustee
(a) Subject to Section 4.2(b), the Capital Securities
Guarantee Trustee may be appointed or removed without cause at any time by the
Guarantor except during an Event of Default.
(b) The Capital Securities Guarantee Trustee shall not be
removed in accordance with Section 4.2(a) until a Successor Capital Securities
Guarantee Trustee has been appointed and has accepted such appointment by
written instrument executed by such Successor Capital Securities Guarantee
Trustee and delivered to the Guarantor.
(c) The Capital Securities Guarantee Trustee shall hold office
until a Successor Capital Securities Guarantee Trustee shall have been appointed
or until its removal or resignation. The Capital Securities Guarantee Trustee
may resign from office (without need for prior or subsequent accounting) by an
instrument in writing executed by the Capital Securities Guarantee Trustee and
delivered to the Guarantor, which resignation shall not take effect until a
Successor Capital Securities Guarantee Trustee has been appointed and has
accepted such appointment by instrument in writing executed by such Successor
Capital Securities Guarantee Trustee and delivered to the Guarantor and the
resigning Capital Securities Guarantee Trustee.
(d) If no Successor Capital Securities Guarantee Trustee shall
have been appointed and accepted appointment as provided in this Section 4.2
within 60 days after delivery of an instrument of removal or resignation, the
Capital Securities Guarantee Trustee resigning or being removed may petition any
court of competent jurisdiction for appointment of a Successor Capital
Securities Guarantee Trustee. Such court may thereupon, after prescribing such
notice, if any, as it may deem proper, appoint a Successor Capital Securities
Guarantee Trustee.
(e) No Capital Securities Guarantee Trustee shall be liable
for the acts or omissions to act of any Successor Capital Securities Guarantee
Trustee.
(f) Upon termination of this Series A Capital Securities
Guarantee or removal or resignation of the Capital Securities Guarantee Trustee
pursuant to this Section 4.2, the Guarantor shall pay to the Capital Securities
Guarantee Trustee all amounts due to the Capital Securities Guarantee Trustee
accrued to the date of such termination, removal or resignation.
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ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee
The Guarantor irrevocably and unconditionally agrees to pay in
full to the Holders the Guarantee Payments (without duplication of amounts
theretofore paid by the Issuer), as and when due, regardless of any defense,
right of set-off or counterclaim that the Issuer may have or assert. The
Guarantor's obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by the Guarantor to the Holders or by causing
the Issuer to pay such amounts to the Holders.
SECTION 5.2 Waiver of Notice and Demand
The Guarantor hereby waives notice of acceptance of this
Series A Capital Securities Guarantee and of any liability to which it applies
or may apply, presentment, demand for payment, any right to require a proceeding
first against the Issuer or any other Person before proceeding against the
Guarantor, protest, notice of nonpayment, notice of dishonor, notice of
redemption and all other notices and demands.
SECTION 5.3 Obligations Not Affected
The obligations, covenants, agreements and duties of the
Guarantor under this Series A Capital Securities Guarantee shall in no way be
affected or impaired by reason of the happening from time to time of any of the
following:
(a) the release or waiver, by operation of law or otherwise,
of the performance or observance by the Issuer of any express or implied
agreement, covenant, term or condition relating to the Series A Capital
Securities to be performed or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all
or any portion of the Distributions, Redemption Price, Liquidation Distribution
or any other sums payable under the terms of the Series A Capital Securities or
the extension of time for the performance of any other obligation under, arising
out of, or in connection with, the Series A Capital Securities (other than an
extension of time for payment of Distributions, Redemption Price, Liquidation
Distribution or other sum payable that results from the extension of any
interest payment period on the Debentures permitted by the Indenture);
(c) any failure, omission, delay or lack of diligence on the
part of the Holders to enforce, assert or exercise any right, privilege, power
or remedy conferred on the Holders pursuant to the terms of the Series A Capital
Securities, or any action on the part of the Issuer granting indulgence or
extension of any kind;
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<PAGE> 19
(d) the voluntary or involuntary liquidation, dissolution,
sale of any collateral, receivership, insolvency, bankruptcy, assignment for the
benefit of creditors, reorganization, arrangement, composition or readjustment
of debt of, or other similar proceedings affecting, the Issuer or any of the
assets of the Issuer;
(e) any invalidity of, or defect or deficiency in, the Series
A Capital Securities;
(f) the settlement or compromise of any obligation guaranteed
hereby or hereby incurred;
(g) the consummation of the Exchange Offer; or
(h) any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a guarantor, it being
the intent of this Section 5.3 that the obligations of the Guarantor with
respect to the Guarantee Payments shall be absolute and unconditional under any
and all circumstances.
There shall be no obligation of the Holders to give notice to,
or obtain consent of, the Guarantor with respect to the happening of any of the
foregoing.
SECTION 5.4 Rights of Holders
(a) The Holders of a Majority in liquidation amount of the
Series A Capital Securities have the right to direct the time, method and place
of conducting any proceeding for any remedy available to the Capital Securities
Guarantee Trustee in respect of this Series A Capital Securities Guarantee or
exercising any trust or power conferred upon the Capital Securities Guarantee
Trustee under this Series A Capital Securities Guarantee provided, however,
that, subject to the duties and responsibilities of the Trustee pursuant to the
Indenture, the Capital Securities Guarantee Trustee shall have the right to
decline to follow any such direction if the Capital Securities Guarantee Trustee
shall determine that the action so directed would be unjustly prejudicial to the
holders not taking part in such direction or if the Capital Securities Guarantee
Trustee being advised by counsel determines that the action or proceeding so
directed may not lawfully be taken or if the Capital Securities Guarantee
Trustee in good faith by its board of directors or trustees, executive
committee, or a trust committee of directors or trustees and/or Responsible
Officers shall determine that the action or proceedings so directed would
involve the Capital Securities Guarantee Trustee in personal liability.
(b) If the Capital Securities Guarantee Trustee fails to
enforce such Series A Capital Securities Guarantee, any Holder may institute a
legal proceeding directly against the Guarantor to enforce the Capital
Securities Guarantee Trustee's rights under this Series A Capital Securities
Guarantee, without first instituting a legal proceeding against the Issuer, the
Capital Securities Guarantee Trustee or any other person or entity. The
Guarantor waives any right or
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<PAGE> 20
remedy to require that any action be brought first against the Issuer or any
other person or entity before proceeding directly against the Guarantor.
SECTION 5.5 Guarantee of Payment
This Series A Capital Securities Guarantee creates a guarantee
of payment and not of collection.
SECTION 5.6 Subrogation
The Guarantor shall be subrogated to all (if any) rights of
the Holders against the Issuer in respect of any amounts paid to such Holders by
the Guarantor under this Series A Capital Securities Guarantee; provided,
however, that the Guarantor shall not (except to the extent required by
mandatory provisions of law) be entitled to enforce or exercise any right that
it may acquire by way of subrogation or any indemnity, reimbursement or other
agreement, in all cases as a result of payment under this Series A Capital
Securities Guarantee, if, at the time of any such payment, any amounts are due
and unpaid under this Series A Capital Securities Guarantee. If any amount shall
be paid to the Guarantor in violation of the preceding sentence, the Guarantor
agrees to hold such amount in trust for the Holders and to pay over such amount
to the Holders.
SECTION 5.7 Independent Obligations
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer with respect to the Series A
Capital Securities, and that the Guarantor shall be liable as principal and as
debtor hereunder to make Guarantee Payments pursuant to the terms of this Series
A Capital Securities Guarantee notwithstanding the occurrence of any event
referred to in subsections (a) through (h), inclusive, of Section 5.3 hereof.
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions
So long as any Capital Securities remain outstanding, the
Guarantor shall not (i) declare or pay any dividends or distributions on, or
redeem, purchase, acquire or make a liquidation payment with respect to, any of
the Guarantor's capital stock (which includes common and preferred stock) or
(ii) make any payment of principal of or premium, if any, or interest on or
repay, repurchase or redeem any debt securities of the Guarantor (including
Other Debentures) that rank pari passu with or junior in right of payment to the
Debentures or (iii) make any guarantee payments with respect to any guarantee by
the Guarantor of the debt securities of any subsidiary of the Guarantor
(including Other Guarantees) if such guarantee
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<PAGE> 21
ranks pari passu with or junior in right of payment to the Debentures (other
than (a) dividends or distributions in shares of, or options, warrants, rights
to subscribe for or purchase shares of, common stock of the Guarantor, (b) any
declaration of a dividend in connection with the implementation of a
stockholders' rights plan, or the issuance of stock under any such plan in the
future, or the redemption or repurchase of any such rights pursuant thereto, (c)
payments under the Series A Capital Securities Guarantee, (d) the purchase of
fractional shares resulting from a reclassification of the Guarantor's capital
stock, (e) the exchange or the conversion of one class, or series of the
Guarantor's capital stock for another class or series of the Guarantor's capital
stock, and (f) the purchase of fractional interests in shares of the Guarantor's
capital stock pursuant to the conversion or exchange provisions of such capital
stock or the security being converted or exchanged) if at such time (1) there
shall have occurred and be continuing an event of default under the Declaration,
(2) there shall have occurred and be continuing an Event of Default under the
Indenture, (3) there shall have occurred and be continuing a payment default
under the Declaration or the Indenture, (4) if the Debentures are held by the
Issuer, the Guarantor shall be in default with respect to its payment of any
obligations under this Agreement, or (5) the Guarantor shall have given notice
of its election of an Extension Period as provided in this Indenture and shall
not have rescinded such notice, and such Extension Period, or any extension
thereof, shall have commenced.
SECTION 6.2 Ranking
This Series A Capital Securities Guarantee will constitute an
unsecured obligation of the Guarantor and will rank (i) subordinate and junior
in right of payment to Senior Indebtedness (as defined in the Indenture), to the
same extent and in the same manner that the Debentures are subordinated to
Senior Indebtedness pursuant to the Indenture, it being understood that the
terms of Article XV of the Indenture shall apply to the obligations of the
Guarantor under this Series A Capital Securities Guarantee as if (x) such
Article XV were set forth herein in full and (y) such obligations were
substituted for the term "Securities" appearing in such Article XV, (ii) pari
passu with the Debentures, the Other Debentures and with the most senior
preferred or preference stock now or hereafter issued by the Guarantor and with
any Other Guarantee (as defined herein) and any Other Common Securities
Guarantee and any guarantee now or hereafter entered into by the Guarantor in
respect of any preferred or preference stock of any Affiliate of the Guarantor,
and (iii) senior to the Guarantor's common stock.
ARTICLE VII
TERMINATION
SECTION 7.1 Termination
This Series A Capital Securities Guarantee shall terminate (i)
upon full payment of the Redemption Price (as defined in the Declaration) of all
Series A Capital Securities, (ii) upon liquidation of the Issuer, the full
payment of the amounts payable in accordance with the
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<PAGE> 22
Declaration or the distribution of the Debentures to the Holders of all of the
Series A Capital Securities or (iii) upon exchange of all the Series A Capital
Securities for the Series B Capital Securities in the Exchange Offer.
Notwithstanding the foregoing, this Series A Capital Securities Guarantee will
continue to be effective or will be reinstated, as the case may be, if at any
time any Holder must restore payment of any sums paid under the Series A Capital
Securities or under this Series A Capital Securities Guarantee.
ARTICLE VIII
COMPENSATION AND EXPENSES OF
CAPITAL SECURITIES GUARANTEE TRUSTEE
The Guarantor covenants and agrees to pay to the Capital
Securities Guarantee Trustee from time to time, and the Capital Securities
Guarantee Trustee shall be entitled to, such compensation as shall be agreed to
in writing between the Guarantor and the Capital Securities Guarantee Trustee
(which shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust), and the Guarantor will pay or
reimburse the Capital Securities Guarantee Trustee upon its request for all
reasonable expenses, disbursements and advances incurred or made by the Capital
Securities Guarantee Trustee in accordance with any of the provisions of this
Capital Securities Guarantee (including the reasonable compensation and the
expenses and disbursements of its counsel and of all persons not regularly in
its employ) except any such expense, disbursement or advance as may arise from
its negligence or bad faith. The Guarantor also covenants to indemnify each of
the Capital Securities Guarantee Trustee (and its officers, agents, directors
and employees) for, and to hold it harmless against, any and all loss, damage,
claim, liability or expense including taxes (other than taxes based on the
income of the Capital Securities Guarantee Trustee) incurred without negligence
or bad faith on the part of the Capital Securities Guarantee Trustee and arising
out of or in connection with the acceptance or administration of this guarantee,
including the costs and expenses of defending itself against any claim of
liability in the premises. The obligations of the Guarantor under this Article
VIII to compensate and indemnify the Capital Securities Guarantee Trustee and to
pay or reimburse the Capital Securities Guarantee Trustee for expenses,
disbursements and advances shall be secured by a lien prior to that of the
Series A Capital Securities upon all property and funds held or collected by the
Capital Securities Guarantee Trustee as such, except funds held in trust for the
benefit of the holders of particular Series A Capital Securities.
The provisions of this Article shall survive the termination
of this Capital Securities Guarantee.
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<PAGE> 23
ARTICLE IX
INDEMNIFICATION
SECTION 9.1 Exculpation
(a) No Indemnified Person shall be liable, responsible or accountable
in damages or otherwise to the Guarantor or any Covered Person for any loss,
damage or claim incurred by reason of any act or omission performed or omitted
by such Indemnified Person in good faith in accordance with this Series A
Capital Securities Guarantee and in a manner that such Indemnified Person
reasonably believed to be within the scope of the authority conferred on such
Indemnified Person by this Series A Capital Securities Guarantee or by law,
except that an Indemnified Person shall be liable for any such loss, damage or
claim incurred by reason of such Indemnified Person's negligence or willful
misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Guarantor and upon such information, opinions,
reports or statements presented to the Guarantor by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Guarantor, including information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and amount of assets from
which Distributions to Holders might properly be paid.
SECTION 9.2 Indemnification
The Guarantor agrees to indemnify each Indemnified Person for,
and to hold each Indemnified Person harmless against, any and all loss,
liability, damage, claim or expense incurred without negligence or bad faith on
its part, arising out of or in connection with the acceptance or administration
of the trust or trusts hereunder, including the costs and expenses (including
reasonable legal fees and expenses) of defending itself against, or
investigating, any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder. The obligation to
indemnify as set forth in this Section 9.2 shall survive the termination of this
Series A Capital Securities Guarantee.
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<PAGE> 24
ARTICLE X
MISCELLANEOUS
SECTION 10.1 Successors and Assigns
All guarantees and agreements contained in this Series A
Capital Securities Guarantee shall bind the successors, assigns, receivers,
trustees and representatives of the Guarantor and shall inure to the benefit of
the Holders then outstanding.
SECTION 10.2 Amendments
Except with respect to any changes that do not materially
adversely affect the rights of Holders (in which case no consent of Holders will
be required), this Series A Capital Securities Guarantee may only be amended
with the prior approval of the Holders of a Majority in liquidation amount of
the Securities (including the stated amount that would be paid on redemption,
liquidation or otherwise, plus accrued and unpaid Distributions to the date upon
which the voting percentages are determined). The provisions of the Declaration
with respect to consents to amendments thereof (whether at a meeting or
otherwise) shall apply to the giving of such approval.
SECTION 10.3 Notices
All notices provided for in this Series A Capital Securities
Guarantee shall be in writing, duly signed by the party giving such notice, and
shall be delivered, telecopied or mailed by first class mail, as follows:
(a) If given to the Issuer, in care of the Administrative
Trustee at the Issuer's mailing address set forth below (or such other address
as the Issuer may give notice of to the Holders and the Capital Securities
Guarantee Trustee):
AGL Capital Trust
c/o AGL Resources Inc.
303 Peachtree Street
Atlanta, Georgia 30308
Attention: J. Michael Riley
Telecopy: 404-584-3945
(b) If given to the Capital Securities Guarantee Trustee, at
the Capital Securities Guarantee Trustee's mailing address set forth below (or
such other address as the Capital Securities Guarantee Trustee may give notice
of to the Holders and the Issuer):
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<PAGE> 25
The Bank of New York
101 Barclay Street, 21 West
New York, New York 10286
Attention: Corporate Trust Trustee Administration
Telecopy: 212-815-5915
(c) If given to the Guarantor, at the Guarantor's mailing
address set forth below (or such other address as the Guarantor may give notice
of to the Holders of the Series A Capital Securities and the Capital Securities
Guarantee Trustee):
AGL Resources Inc.
303 Peachtree Street
Atlanta, Georgia 30308
Attention: J. Michael Riley
Telecopy: 404-584-3945
(d) If given to any Holder of Series A Capital Securities, at
the address set forth on the books and records of the Issuer.
All such notices shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first class
mail, postage prepaid except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no notice
was given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.
SECTION 10.4 Exchange Offer
In the event an Exchange Offer Registration Statement (as
defined in the Registration Rights Agreement) becomes effective and the Issuer
issues any Series B Capital Securities in the Exchange Offer, the Guarantor will
enter into a new capital securities guarantee agreement, in substantially the
same form as this Series A Capital Securities Guarantee, with respect to the
Series B Capital Securities.
SECTION 10.5 Benefit
This Series A Capital Securities Guarantee is solely for the
benefit of the Holders and, subject to Section 3.1(a), is not separately
transferable from the Series A Capital Securities.
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<PAGE> 26
SECTION 10.6 Governing Law
THIS SERIES A CAPITAL SECURITIES GUARANTEE SHALL BE GOVERNED
BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF.
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<PAGE> 27
THIS SERIES A CAPITAL SECURITIES GUARANTEE is executed as of
the day and year first above written.
AGL RESOURCES INC.,
as Guarantor
By: /s/ J. Michael Riley
-----------------------------------------
Name: J. Michael Riley
Title: Vice President and Chief Financial
Officer
THE BANK OF NEW YORK,
as Capital Securities Guarantee Trustee
By: /s/ Stephen J. Giurlando
-----------------------------------------
Name: Stephen J. Giurlando
Title: Assistant Vice President
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<PAGE> 1
EXHIBIT 4.7
SERIES B CAPITAL SECURITIES GUARANTEE AGREEMENT
AGL RESOURCES INC.
DATED AS OF _______, 1997
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
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<S> <C>
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation................................... 2
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application................................. 6
SECTION 2.2 Lists of Holders of Securities................................... 6
SECTION 2.3 Reports by the Capital Securities Guarantee Trustee.............. 6
SECTION 2.4 Periodic Reports to Capital Securities Guarantee Trustee......... 6
SECTION 2.5 Evidence of Compliance with Conditions Precedent................. 7
SECTION 2.6 Events of Default; Waiver........................................ 7
SECTION 2.7 Event of Default; Notice......................................... 7
SECTION 2.8 Conflicting Interests............................................ 8
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
CAPITAL SECURITIES GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Capital Securities Guarantee Trustee.... 8
SECTION 3.2 Certain Rights of Capital Securities Guarantee Trustee........... 10
SECTION 3.3 Not Responsible for Recitals or Issuance of Series B Capital
Securities Guarantee............................................. 12
ARTICLE IV
CAPITAL SECURITIES GUARANTEE TRUSTEE
SECTION 4.1 Capital Securities Guarantee Trustee; Eligibility................ 12
SECTION 4.2 Appointment, Removal and Resignation of Capital Securities
Guarantee Trustee................................................ 13
</TABLE>
i
<PAGE> 3
<TABLE>
<CAPTION>
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<S> <C>
ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee........................................................ 14
SECTION 5.2 Waiver of Notice and Demand...................................... 14
SECTION 5.3 Obligations Not Affected......................................... 14
SECTION 5.4 Rights of Holders................................................ 15
SECTION 5.5 Guarantee of Payment............................................. 16
SECTION 5.6 Subrogation...................................................... 16
SECTION 5.7 Independent Obligations.......................................... 16
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions....................................... 16
SECTION 6.2 Ranking.......................................................... 17
ARTICLE VII
TERMINATION
SECTION 7.1 Termination...................................................... 17
ARTICLE VIII
COMPENSATION AND EXPENSES OF
CAPITAL SECURITIES GUARANTEE TRUSTEE...................... 18
ARTICLE IX
INDEMNIFICATION
SECTION 9.1 Exculpation...................................................... 19
SECTION 9.2 Indemnification.................................................. 19
ARTICLE X
MISCELLANEOUS
SECTION 10.1 Successors and Assigns........................................... 20
SECTION 10.2 Amendments....................................................... 20
</TABLE>
ii
<PAGE> 4
<TABLE>
<CAPTION>
Page
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<S> <C>
SECTION 10.3 Notices.......................................................... 20
SECTION 10.4 Exchange Offer................................................... 21
SECTION 10.5 Benefit.......................................................... 21
SECTION 10.6 Governing Law.................................................... 22
</TABLE>
iii
<PAGE> 5
SERIES B CAPITAL SECURITIES GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (the "Series B Capital Securities
Guarantee"), dated as of _______, 1997, is executed and delivered by AGL
Resources Inc., a Georgia corporation (the "Guarantor"), and The Bank of New
York, a New York banking corporation, as trustee (the "Capital Securities
Guarantee Trustee"), for the benefit of the Holders (as defined herein) from
time to time of the Series B Capital Securities (as defined herein) of AGL
Capital Trust, a Delaware statutory business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of
Trust (the "Declaration"), dated as of June 11, 1997, among the trustees of the
Issuer, the Guarantor, as sponsor, and the holders from time to time of
undivided beneficial interests in the assets of the Issuer, the Issuer issued on
the date thereof 75,000 Series A capital securities, having an aggregate
liquidation amount of $75,000,000, such capital securities being designated the
8.17% Series A Capital Securities (collectively the "Series A Capital
Securities").
WHEREAS, as incentive for the holders of the Series A Capital
Securities to purchase the Series A Capital Securities, the Guarantor executed
and delivered the Series A Capital Securities Guaranty Agreement dated as of
June 11, 1997 (the "Series A Capital Securities Guarantee") pursuant to which
the Guarantor irrevocably and unconditionally agreed, to the extent set forth in
the Series A Capital Securities Guarantee, to pay to the holders of the Series A
Capital Securities the Guarantee Payments (as defined therein).
WHEREAS, in connection with an Exchange Offer (as defined in
the Declaration) the Guarantor has agreed in the Series A Capital Securities
Guarantee to execute and deliver this Series B Capital Securities Guarantee for
the benefit of Holders of the Series B Capital Securities. The Guarantor agrees
to make certain other payments on the terms and conditions set forth herein.
WHEREAS, the Guarantor executed and delivered a guarantee
agreement (the "Common Securities Guarantee"), with substantially identical
terms to this Series A Capital Securities Guarantee and the Series B Capital
Securities Guarantee, for the benefit of the holders of the Common Securities
(as defined herein), except that if an Event of Default (as defined in the
Declaration) has occurred and is continuing, the rights of holders of the Common
Securities to receive Guarantee Payments under the Common Securities Guarantee
are subordinated, to the extent and in the manner set forth in the Common
Securities Guarantee, to the rights of holders of Series A Capital Securities
and the Series B Capital Securities to receive Guarantee Payments under the
Series A Capital Securities Guarantee and the Series B Capital Securities
Guarantee, as the case may be.
NOW, THEREFORE, in consideration of the purchase by each
Holder, which purchase the Guarantor hereby acknowledges shall benefit the
Guarantor, the Guarantor executes and delivers this Series B Capital Securities
Guarantee for the benefit of the Holders.
<PAGE> 6
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation
In this Series B Capital Securities Guarantee, unless the
context otherwise requires:
(a) Capitalized terms used in this Series B Capital
Securities Guarantee but not defined in the preamble
above have the respective meanings assigned to them
in this Section 1.1;
(b) Terms defined in the Declaration as of the date of
execution of this Series B Capital Securities
Guarantee have the same meaning when used in this
Series B Capital Securities Guarantee unless
otherwise defined in this Series B Capital Securities
Guarantee;
(c) a term defined anywhere in this Series B Capital
Securities Guarantee has the same meaning throughout;
(d) all references to "the Series B Capital Securities
Guarantee" or "this Series B Capital Securities
Guarantee" are to this Series B Capital Securities
Guarantee as modified, supplemented or amended from
time to time;
(e) all references in this Series B Capital Securities
Guarantee to Articles and Sections are to Articles
and Sections of this Series B Capital Securities
Guarantee, unless otherwise specified;
(f) a term defined in the Trust Indenture Act has the
same meaning when used in this Series B Capital
Securities Guarantee, unless otherwise defined in
this Series B Capital Securities Guarantee or unless
the context otherwise requires; and
(g) a reference to the singular includes the plural and
vice versa.
"Affiliate" has the same meaning as given to that term in Rule
405 under the Securities Act of 1933, as amended, or any successor rule
thereunder.
"Business Day" means any day other than a Saturday or a
Sunday, or a day on which banking institutions in The City of New York are
authorized or required by law or executive order to close.
-2-
<PAGE> 7
"Capital Securities Guarantee Trustee" means The Bank of New
York, a New York banking corporation, until a Successor Capital Securities
Guarantee Trustee has been appointed and has accepted such appointment pursuant
to the terms of this Series B Capital Securities Guarantee and thereafter means
each such Successor Capital Securities Guarantee Trustee.
"Common Securities" means the securities representing common
undivided beneficial interests in the assets of the Issuer.
"Corporate Trust Office" means the office of the Capital
Securities Guarantee Trustee at which the corporate trust business of the
Capital Securities Guarantee Trustee shall, at any particular time, be
principally administered, which office at the date of execution of this
Agreement is located at 101 Barclay Street, 21 West, New York, New York 10286.
"Covered Person" means any Holder or beneficial owner of
Series B Capital Securities.
"Debentures" means the series of subordinated debt securities
of the Guarantor designated the 8.17% Series B Junior Subordinated Deferrable
Interest Debentures due June 1, 2037 held by the Property Trustee (as defined in
the Declaration) of the Issuer.
"Event of Default" means a default by the Guarantor on any of
its payment or other obligations under this Series B Capital Securities
Guarantee.
"Guarantee Payments" means the following payments or
distributions, without duplication, with respect to the Series B Capital
Securities, to the extent not paid or made by the Issuer: (i) any accumulated
and unpaid Distributions (as defined in the Declaration) that are required to be
paid on such Series B Capital Securities to the extent the Issuer has funds on
hand legally available therefor at such time, (ii) the redemption price,
including all accumulated and unpaid Distributions to the date of redemption
(the "Redemption Price") to the extent the Issuer has funds on hand legally
available therefor at such time, with respect to any Series B Capital Securities
called for redemption by the Issuer, and (iii) upon a voluntary or involuntary
termination and liquidation of the Issuer (other than in connection with the
distribution of Debentures to the Holders in exchange for Series B Capital
Securities as provided in the Declaration), the lesser of (a) the aggregate of
the liquidation amount and all accumulated and unpaid Distributions on the
Series B Capital Securities to the date of payment, to the extent the Issuer has
funds on hand legally available therefor, and (b) the amount of assets of the
Issuer remaining available for distribution to Holders in liquidation of the
Issuer. If an Event of Default has occurred and is continuing, no Guarantee
Payments under the Common Securities Guarantee with respect to the Common
Securities or any guarantee payment under any Other Common Securities Guarantees
shall be made until the Holders shall be paid in full the Guarantee Payments to
which they are entitled under this Series B Capital Securities Guarantee.
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"Holder" shall mean any holder, as registered on the books and
records of the Issuer, of any Series B Capital Securities; provided, however,
that, in determining whether the holders of the requisite percentage of Series B
Capital Securities have given any request, notice, consent or waiver hereunder,
"Holder" shall not include the Guarantor or any Affiliate of the Guarantor.
"Indemnified Person" means the Capital Securities Guarantee
Trustee, any Affiliate of the Capital Securities Guarantee Trustee, or any
officers, directors, shareholders, members, partners, employees,
representatives, nominees, custodians or agents of the Capital Securities
Guarantee Trustee.
"Indenture" means the Indenture dated as of June 11, 1997,
among the Guarantor (the "Debenture Issuer") and The Bank of New York, as
trustee (the "Property Trustee"), pursuant to which the Debentures are to be
issued to the Property Trustee of the Issuer.
"Indenture Event of Default" shall mean any event specified in
Section 5.01 of the Indenture.
"Majority in liquidation amount of the Series B Capital
Securities" means, except as provided by the Trust Indenture Act, a vote by
Holder(s) of more than 50% of the aggregate liquidation amount (including the
stated amount that would be paid on redemption, liquidation or otherwise, plus
accumulated and unpaid Distributions to the date upon which the voting
percentages are determined) of all Series B Capital Securities.
"Officers' Certificate" means, with respect to any person, a
certificate signed by the Chairman, the Chief Executive Officer, the President,
a Vice President, the Controller, the Secretary or an Assistant Secretary, the
Treasurer or an Assistant Treasurer of the Guarantor. Any Officers' Certificate
delivered with respect to compliance with a condition or covenant provided for
in this Series B Capital Securities Guarantee (other than pursuant to Section
314(d)(4) of the Trust Indenture Act) shall include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions
relating thereto;
(b) a statement that each such officer has made such
examination or investigation as, in such officer's opinion, is
necessary to enable such officer to express an informed opinion as to
whether or not such covenant or condition has been complied with; and
(c) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
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"Other Common Securities Guarantees" shall have the same
meaning as "Other Guarantees" in the Common Securities Guarantee.
"Other Debentures" means all junior subordinated debentures
issued by the Guarantor from time to time and sold to trusts to be established
by the Guarantor (if any), in each case similar to the Issuer.
"Other Guarantees" means all guarantees to be issued by the
Guarantor with respect to capital securities (if any) similar to the Series B
Capital Securities issued by other trusts to be established by the Guarantor (if
any), in each case similar to the Issuer.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of June 11, 1997, by and among the Guarantor, the Issuer and
the Initial Purchasers named therein as such agreement may be amended, modified
or supplemented from time to time.
"Responsible Officer" means, with respect to the Capital
Securities Guarantee Trustee, any officer within the Corporate Trust Office of
the Capital Securities Guarantee Trustee, including any vice president, any
assistant vice president, any assistant secretary, the treasurer, any assistant
treasurer, any trust officer, any senior trust officer or other officer in the
Corporate Trust Office of the Capital Securities Guarantee Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of that officer's
knowledge of and familiarity with the particular subject.
"Successor Capital Securities Guarantee Trustee" means a
successor Capital Securities Guarantee Trustee possessing the qualifications to
act as Capital Securities Guarantee Trustee under Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended.
"Trust Securities" means the Common Securities and the Series
A Capital Securities and Series B Capital Securities, collectively.
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ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application
(a) This Series B Capital Securities Guarantee is subject to
the provisions of the Trust Indenture Act that are required to be part of this
Series B Capital Securities Guarantee and shall, to the extent applicable, be
governed by such provisions; and
(b) if and to the extent that any provision of this Series B
Capital Securities Guarantee limits, qualifies or conflicts with the duties
imposed by Section 310 to 317, inclusive, of the Trust Indenture Act, such
imposed duties shall control.
SECTION 2.2 Lists of Holders of Securities
(a) The Guarantor shall provide the Capital Securities Guarantee
Trustee (unless the Capital Securities Guarantee Trustee is otherwise the
registrar of the Capital Securities) with a list, in such form as the Capital
Securities Guarantee Trustee may reasonably require, of the names and addresses
of the Holders ("List of Holders") as of such date, (i) within 14 days after
each record date for payment of Distributions, and (ii) at any other time within
30 days of receipt by the Guarantor of a written request for a List of Holders
as of a date no more than 14 days before such List of Holders is given to the
Capital Securities Guarantee Trustee provided, that the Guarantor shall not be
obligated to provide such List of Holders at any time the List of Holders does
not differ from the most recent List of Holders given to the Capital Securities
Guarantee Trustee by the Guarantor. The Capital Securities Guarantee Trustee may
destroy any List of Holders previously given to it on receipt of a new List of
Holders.
(b) The Capital Securities Guarantee Trustee shall comply with
its obligations under Sections 311(a), 311(b) and Section 312(b) of the Trust
Indenture Act.
SECTION 2.3 Reports by the Capital Securities Guarantee Trustee
Within 60 days after May 15 of each year, commencing May 15,
1998, the Capital Securities Guarantee Trustee shall provide to the Holders such
reports as are required by Section 313(a) of the Trust Indenture Act, if any, in
the form and in the manner provided by Section 313 of the Trust Indenture Act.
The Capital Securities Guarantee Trustee shall also comply with the other
requirements of Section 313 of the Trust Indenture Act.
SECTION 2.4 Periodic Reports to Capital Securities Guarantee Trustee
The Guarantor shall provide to the Capital Securities
Guarantee Trustee such documents, reports and information as required by Section
314 (if any) and the compliance certificate required by Section 314 of the Trust
Indenture Act in the form, in the manner and at
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the times required by Section 314 of the Trust Indenture Act provided that such
compliance certificate shall be delivered on or before 120 days after the end of
each fiscal year of the Guarantor. Delivery of such reports, information and
documents to the Capital Securities Guarantee Trustee is for informational
purposes only and the Capital Securities Guarantee Trustee's receipt of such
shall not constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Guarantor's
compliance with any of its covenants hereunder (as to which the Capital
Securities Guarantee Trustee is entitled to rely exclusively on Officers'
Certificates).
SECTION 2.5 Evidence of Compliance with Conditions Precedent
The Guarantor shall provide to the Capital Securities
Guarantee Trustee such evidence of compliance with any conditions precedent, if
any, provided for in this Series B Capital Securities Guarantee that relate to
any of the matters set forth in Section 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given by an officer pursuant to Section
314(c)(1) may be given in the form of an Officers' Certificate.
SECTION 2.6 Events of Default; Waiver
The Holders of a Majority in liquidation amount of Series B
Capital Securities may, by vote, on behalf of all the Holders, waive any past
Event of Default and its consequences. Upon such waiver, any such Event of
Default shall cease to exist, and any Event of Default arising therefrom shall
be deemed to have been cured, for every purpose of this Series B Capital
Securities Guarantee, but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent thereon.
SECTION 2.7 Event of Default; Notice
(a) The Capital Securities Guarantee Trustee shall, within 90
days after the occurrence of a default with respect to this Capital Securities
Guarantee, mail by first class postage prepaid, to all Holders, notices of all
defaults actually known to a Responsible Officer of the Capital Securities
Guarantee Trustee, unless such defaults have been cured before the giving of
such notice, provided, that, except in the case of default in the payment of any
Guarantee Payment, the Capital Securities Guarantee Trustee shall be protected
in withholding such notice if and so long as the board of directors, the
executive committee, or a trust committee of directors and/or Responsible
Officers of the Capital Securities Guarantee Trustee in good faith determines
that the withholding of such notice is in the interests of the holders of the
Series B Capital Securities.
(b) The Capital Securities Guarantee Trustee shall not be
deemed to have knowledge of any Event of Default unless the Capital Securities
Guarantee Trustee shall have received written notice from the Guarantor or a
Holder, or a Responsible Officer of the Capital
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Securities Guarantee Trustee charged with the administration of the Declaration
shall have obtained actual knowledge, of such Event of Default.
SECTION 2.8 Conflicting Interests
The Declaration shall be deemed to be specifically described
in this Series B Capital Securities Guarantee for the purposes of clause (i) of
the first proviso contained in Section 310(b) of the Trust Indenture Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
CAPITAL SECURITIES GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Capital Securities Guarantee Trustee
(a) This Series B Capital Securities Guarantee shall be held
by the Capital Securities Guarantee Trustee for the benefit of the Holders, and
the Capital Securities Guarantee Trustee shall not transfer this Series B
Capital Securities Guarantee to any Person except a Holder exercising his or her
rights pursuant to Section 5.4(b) or to a Successor Capital Securities Guarantee
Trustee on acceptance by such Successor Capital Securities Guarantee Trustee of
its appointment to act as Successor Capital Securities Guarantee Trustee. The
right, title and interest of the Capital Securities Guarantee Trustee shall
automatically vest in any Successor Capital Securities Guarantee Trustee, and
such vesting and succession of title shall be effective whether or not
conveyancing documents have been executed and delivered pursuant to the
appointment of such Successor Capital Securities Guarantee Trustee.
(b) If an Event of Default actually known to a Responsible
Officer of the Capital Securities Guarantee Trustee has occurred and is
continuing, the Capital Securities Guarantee Trustee shall enforce this Series B
Capital Securities Guarantee for the benefit of the Holders.
(c) The Capital Securities Guarantee Trustee, before the
occurrence of any Event of Default and after the curing of all Events of Default
that may have occurred, shall undertake to perform only such duties as are
specifically set forth in this Series B Capital Securities Guarantee, and no
implied covenants shall be read into this Series B Capital Securities Guarantee
against the Capital Securities Guarantee Trustee. In case an Event of Default
has occurred (that has not been cured or waived pursuant to Section 2.6) and is
actually known to a Responsible Officer of the Capital Securities Guarantee
Trustee, the Capital Securities Guarantee Trustee shall exercise such of the
rights and powers vested in it by this Series B Capital Securities Guarantee,
and use the same degree of care and skill in its exercise thereof, as a prudent
person would exercise or use under the circumstances in the conduct of his or
her own affairs.
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(d) No provision of this Series B Capital Securities Guarantee
shall be construed to relieve the Capital Securities Guarantee Trustee from
liability for its own negligent action, its own negligent failure to act, or its
own willful misconduct, except that:
(i) prior to the occurrence of any Event of Default and
after the curing or waiving of all such Events of Default that may have
occurred:
(A) the duties and obligations of the Capital
Securities Guarantee Trustee shall be determined solely by the
express provisions of this Series B Capital Securities
Guarantee, and the Capital Securities Guarantee Trustee shall
not be liable except for the performance of such duties and
obligations as are specifically set forth in this Series B
Capital Securities Guarantee, and no implied covenants or
obligations shall be read into this Series B Capital
Securities Guarantee against the Capital Securities Guarantee
Trustee; and
(B) in the absence of bad faith on the part of the
Capital Securities Guarantee Trustee, the Capital Securities
Guarantee Trustee may conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed
therein, upon any certificates or opinions furnished to the
Capital Securities Guarantee Trustee and conforming to the
requirements of this Series B Capital Securities Guarantee;
but in the case of any such certificates or opinions that by
any provision hereof are specifically required to be furnished
to the Capital Securities Guarantee Trustee, the Capital
Securities Guarantee Trustee shall be under a duty to examine
the same to determine whether or not they conform to the
requirements of this Series B Capital Securities Guarantee;
(ii) the Capital Securities Guarantee Trustee shall not be
liable for any error of judgment made in good faith by a Responsible
Officer of the Capital Securities Guarantee Trustee, unless it shall be
proved that the Capital Securities Guarantee Trustee was negligent in
ascertaining the pertinent facts upon which such judgment was made;
(iii) the Capital Securities Guarantee Trustee shall not be
liable with respect to any action taken or omitted to be taken by it in
good faith in accordance with the direction of the Holders of a
Majority in liquidation amount of the Series B Capital Securities
relating to the time, method and place of conducting any proceeding for
any remedy available to the Capital Securities Guarantee Trustee, or
exercising any trust or power conferred upon the Capital Securities
Guarantee Trustee under this Series B Capital Securities Guarantee; and
(iv) no provision of this Series B Capital Securities
Guarantee shall require the Capital Securities Guarantee Trustee to
expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of
any of its rights or powers, if the Capital Securities Guarantee
Trustee shall have reasonable
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grounds for believing that the repayment of such funds or liability is
not reasonably assured to it under the terms of this Series B Capital
Securities Guarantee or indemnity, reasonably satisfactory to the
Capital Securities Guarantee Trustee, against such risk or liability is
not reasonably assured to it.
SECTION 3.2 Certain Rights of Capital Securities Guarantee Trustee
(a) Subject to the provisions of Section 3.1:
(i) The Capital Securities Guarantee Trustee may conclusively
rely, and shall be fully protected in acting or refraining from acting,
upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed, sent or presented
by the proper party or parties.
(ii) Any direction or act of the Guarantor contemplated by
this Series B Capital Securities Guarantee may be sufficiently
evidenced by an Officers' Certificate.
(iii) Whenever, in the administration of this Series B Capital
Securities Guarantee, the Capital Securities Guarantee Trustee shall
deem it desirable that a matter be proved or established before taking,
suffering or omitting any action hereunder, the Capital Securities
Guarantee Trustee (unless other evidence is herein specifically
prescribed) may, in the absence of bad faith on its part, request and
conclusively rely upon an Officers' Certificate which, upon receipt of
such request, shall be promptly delivered by the Guarantor.
(iv) The Capital Securities Guarantee Trustee shall have no
duty to see to any recording, filing or registration of any instrument
(or any rerecording, refiling or registration thereof).
(v) The Capital Securities Guarantee Trustee may consult with
counsel of its selection, and the advice or opinion of such counsel
with respect to legal matters shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted by
it hereunder in good faith and in accordance with such advice or
opinion. Such counsel may be counsel to the Guarantor or any of its
Affiliates and may include any of its employees. The Capital Securities
Guarantee Trustee shall have the right at any time to seek instructions
concerning the administration of this Series B Capital Securities
Guarantee from any court of competent jurisdiction.
(vi) The Capital Securities Guarantee Trustee shall be under
no obligation to exercise any of the rights or powers vested in it by
this Series B Capital Securities Guarantee at the request or direction
of any Holder, unless such Holder shall have provided to the Capital
Securities Guarantee Trustee such security and indemnity,
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reasonably satisfactory to the Capital Securities Guarantee Trustee,
against the costs, expenses (including attorneys' fees and expenses and
the expenses of the Capital Securities Guarantee Trustee's agents,
nominees or custodians) and liabilities that might be incurred by it in
complying with such request or direction, including such reasonable
advances as may be requested by the Capital Securities Guarantee
Trustee; provided that, nothing contained in this Section 3.2(a)(vi)
shall be taken to relieve the Capital Securities Guarantee Trustee,
upon the occurrence of an Event of Default, of its obligation to
exercise the rights and powers vested in it by this Series B Capital
Securities Guarantee.
(vii) The Capital Securities Guarantee Trustee shall not be
bound to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document, but the
Capital Securities Guarantee Trustee, in its discretion, may make such
further inquiry or investigation into such facts or matters as it may
see fit.
(viii) The Capital Securities Guarantee Trustee may execute
any of the trusts or powers hereunder or perform any duties hereunder
either directly or by or through agents, nominees, custodians or
attorneys, and the Capital Securities Guarantee Trustee shall not be
responsible for any misconduct or negligence on the part of any agent
or attorney appointed with due care by it hereunder.
(ix) Any action taken by the Capital Securities Guarantee
Trustee or its agents hereunder shall bind the Holders, and the
signature of the Capital Securities Guarantee Trustee or its agents
alone shall be sufficient and effective to perform any such action. No
third party shall be required to inquire as to the authority of the
Capital Securities Guarantee Trustee to so act or as to its compliance
with any of the terms and provisions of this Series B Capital
Securities Guarantee, both of which shall be conclusively evidenced by
the Capital Securities Guarantee Trustee's or its agent's taking such
action.
(x) Whenever in the administration of this Series B Capital
Securities Guarantee the Capital Securities Guarantee Trustee shall
deem it desirable to receive instructions with respect to enforcing any
remedy or right or taking any other action hereunder, the Capital
Securities Guarantee Trustee (i) may request instructions from the
Holders of a Majority in liquidation amount of the Series B Capital
Securities, (ii) may refrain from enforcing such remedy or right or
taking such other action until such instructions are received, and
(iii) shall be protected in conclusively relying on or acting in
accordance with such instructions.
(xi) The Capital Securities Guarantee Trustee shall not be
liable for any action taken, suffered, or omitted to be taken by it in
good faith, without negligence, and reasonably believed by it to be
authorized or within the discretion or rights or powers conferred upon
it by this Series B Capital Securities Guarantee.
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(b) No provision of this Series B Capital Securities Guarantee
shall be deemed to impose any duty or obligation on the Capital Securities
Guarantee Trustee to perform any act or acts or exercise any right, power, duty
or obligation conferred or imposed on it in any jurisdiction in which it shall
be illegal, or in which the Capital Securities Guarantee Trustee shall be
unqualified or incompetent in accordance with applicable law, to perform any
such act or acts or to exercise any such right, power, duty or obligation. No
permissive power or authority available to the Capital Securities Guarantee
Trustee shall be construed to be a duty.
SECTION 3.3. Not Responsible for Recitals or Issuance of Series B Capital
Securities Guarantee
The recitals contained in this Series B Capital Securities
Guarantee shall be taken as the statements of the Guarantor, and the Capital
Securities Guarantee Trustee does not assume any responsibility for their
correctness. The Capital Securities Guarantee Trustee makes no representation as
to the validity or sufficiency of this Series B Capital Securities Guarantee.
ARTICLE IV
CAPITAL SECURITIES GUARANTEE TRUSTEE
SECTION 4.1 Capital Securities Guarantee Trustee; Eligibility
(a) There shall at all times be a Capital Securities Guarantee
Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under
the laws of the United States of America or any State or Territory
thereof or of the District of Columbia, or a corporation or Person
permitted by the Securities and Exchange Commission to act as an
institutional trustee under the Trust Indenture Act, authorized under
such laws to exercise corporate trust powers, having a combined capital
and surplus of at least 50 million U.S. dollars ($50,000,000), and
subject to supervision or examination by Federal, State, Territorial or
District of Columbia authority. If such corporation publishes reports
of condition at least annually, pursuant to law or to the requirements
of the supervising or examining authority referred to above, then, for
the purposes of this Section 4.1(a)(ii), the combined capital and
surplus of such corporation shall be deemed to be its combined capital
and surplus as set forth in its most recent report of condition so
published.
(b) If at any time the Capital Securities Guarantee Trustee
shall cease to be eligible to so act under Section 4.1(a), the Capital
Securities Guarantee Trustee shall immediately resign in the manner and with the
effect set out in Section 4.2(c).
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(c) If the Capital Securities Guarantee Trustee has or shall acquire
any "conflicting interest" within the meaning of Section 310(b) of the Trust
Indenture Act, the Capital Securities Guarantee Trustee and Guarantor shall in
all respects comply with the provisions of Section 310(b) of the Trust Indenture
Act, subject to the penultimate paragraph thereof.
SECTION 4.2 Appointment, Removal and Resignation of Capital Securities Guarantee
Trustee
(a) Subject to Section 4.2(b), the Capital Securities
Guarantee Trustee may be appointed or removed without cause at any time by the
Guarantor except during an Event of Default.
(b) The Capital Securities Guarantee Trustee shall not be
removed in accordance with Section 4.2(a) until a Successor Capital Securities
Guarantee Trustee has been appointed and has accepted such appointment by
written instrument executed by such Successor Capital Securities Guarantee
Trustee and delivered to the Guarantor.
(c) The Capital Securities Guarantee Trustee shall hold office
until a Successor Capital Securities Guarantee Trustee shall have been appointed
or until its removal or resignation. The Capital Securities Guarantee Trustee
may resign from office (without need for prior or subsequent accounting) by an
instrument in writing executed by the Capital Securities Guarantee Trustee and
delivered to the Guarantor, which resignation shall not take effect until a
Successor Capital Securities Guarantee Trustee has been appointed and has
accepted such appointment by instrument in writing executed by such Successor
Capital Securities Guarantee Trustee and delivered to the Guarantor and the
resigning Capital Securities Guarantee Trustee.
(d) If no Successor Capital Securities Guarantee Trustee shall
have been appointed and accepted appointment as provided in this Section 4.2
within 60 days after delivery of an instrument of removal or resignation, the
Capital Securities Guarantee Trustee resigning or being removed may petition any
court of competent jurisdiction for appointment of a Successor Capital
Securities Guarantee Trustee. Such court may thereupon, after prescribing such
notice, if any, as it may deem proper, appoint a Successor Capital Securities
Guarantee Trustee.
(e) No Capital Securities Guarantee Trustee shall be liable
for the acts or omissions to act of any Successor Capital Securities Guarantee
Trustee.
(f) Upon termination of this Series B Capital Securities
Guarantee or removal or resignation of the Capital Securities Guarantee Trustee
pursuant to this Section 4.2, the Guarantor shall pay to the Capital Securities
Guarantee Trustee all amounts due to the Capital Securities Guarantee Trustee
accrued to the date of such termination, removal or resignation.
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ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee
The Guarantor irrevocably and unconditionally agrees to pay in
full to the Holders the Guarantee Payments (without duplication of amounts
theretofore paid by the Issuer), as and when due, regardless of any defense,
right of set-off or counterclaim that the Issuer may have or assert. The
Guarantor's obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by the Guarantor to the Holders or by causing
the Issuer to pay such amounts to the Holders.
SECTION 5.2 Waiver of Notice and Demand
The Guarantor hereby waives notice of acceptance of this
Series B Capital Securities Guarantee and of any liability to which it applies
or may apply, presentment, demand for payment, any right to require a proceeding
first against the Issuer or any other Person before proceeding against the
Guarantor, protest, notice of nonpayment, notice of dishonor, notice of
redemption and all other notices and demands.
SECTION 5.3 Obligations Not Affected
The obligations, covenants, agreements and duties of the
Guarantor under this Series B Capital Securities Guarantee shall in no way be
affected or impaired by reason of the happening from time to time of any of the
following:
(a) the release or waiver, by operation of law or otherwise,
of the performance or observance by the Issuer of any express or implied
agreement, covenant, term or condition relating to the Series B Capital
Securities to be performed or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all
or any portion of the Distributions, Redemption Price, Liquidation Distribution
or any other sums payable under the terms of the Series B Capital Securities or
the extension of time for the performance of any other obligation under, arising
out of, or in connection with, the Series B Capital Securities (other than an
extension of time for payment of Distributions, Redemption Price, Liquidation
Distribution or other sum payable that results from the extension of any
interest payment period on the Debentures permitted by the Indenture);
(c) any failure, omission, delay or lack of diligence on the
part of the Holders to enforce, assert or exercise any right, privilege, power
or remedy conferred on the Holders pursuant to the terms of the Series B Capital
Securities, or any action on the part of the Issuer granting indulgence or
extension of any kind;
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(d) the voluntary or involuntary liquidation, dissolution,
sale of any collateral, receivership, insolvency, bankruptcy, assignment for the
benefit of creditors, reorganization, arrangement, composition or readjustment
of debt of, or other similar proceedings affecting, the Issuer or any of the
assets of the Issuer;
(e) any invalidity of, or defect or deficiency in, the Series
B Capital Securities;
(f) the settlement or compromise of any obligation guaranteed
hereby or hereby incurred;
(g) the consummation of the Exchange Offer; or
(h) any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a guarantor, it being
the intent of this Section 5.3 that the obligations of the Guarantor with
respect to the Guarantee Payments shall be absolute and unconditional under any
and all circumstances.
There shall be no obligation of the Holders to give notice to,
or obtain consent of, the Guarantor with respect to the happening of any of the
foregoing.
SECTION 5.4 Rights of Holders
(a) The Holders of a Majority in liquidation amount of the
Series B Capital Securities have the right to direct the time, method and place
of conducting any proceeding for any remedy available to the Capital Securities
Guarantee Trustee in respect of this Series B Capital Securities Guarantee or
exercising any trust or power conferred upon the Capital Securities Guarantee
Trustee under this Series B Capital Securities Guarantee provided, however,
that, subject to the duties and responsibilities of the Trustee pursuant to the
Indenture, the Capital Securities Guarantee Trustee shall have the right to
decline to follow any such direction if the Capital Securities Guarantee Trustee
shall determine that the action so directed would be unjustly prejudicial to the
holders not taking part in such direction or if the Capital Securities Guarantee
Trustee being advised by counsel determines that the action or proceeding so
directed may not lawfully be taken or if the Capital Securities Guarantee
Trustee in good faith by its board of directors or trustees, executive
committee, or a trust committee of directors or trustees and/or Responsible
Officers shall determine that the action or proceedings so directed would
involve the Capital Securities Guarantee Trustee in personal liability.
(b) If the Capital Securities Guarantee Trustee fails to
enforce such Series B Capital Securities Guarantee, any Holder may institute a
legal proceeding directly against the Guarantor to enforce the Capital
Securities Guarantee Trustee's rights under this Series B Capital Securities
Guarantee, without first instituting a legal proceeding against the Issuer, the
Capital Securities Guarantee Trustee or any other person or entity. The
Guarantor waives any right or
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remedy to require that any action be brought first against the Issuer or any
other person or entity before proceeding directly against the Guarantor.
SECTION 5.5 Guarantee of Payment
This Series B Capital Securities Guarantee creates a guarantee
of payment and not of collection.
SECTION 5.6 Subrogation
The Guarantor shall be subrogated to all (if any) rights of
the Holders against the Issuer in respect of any amounts paid to such Holders by
the Guarantor under this Series B Capital Securities Guarantee; provided,
however, that the Guarantor shall not (except to the extent required by
mandatory provisions of law) be entitled to enforce or exercise any right that
it may acquire by way of subrogation or any indemnity, reimbursement or other
agreement, in all cases as a result of payment under this Series B Capital
Securities Guarantee, if, at the time of any such payment, any amounts are due
and unpaid under this Series B Capital Securities Guarantee. If any amount shall
be paid to the Guarantor in violation of the preceding sentence, the Guarantor
agrees to hold such amount in trust for the Holders and to pay over such amount
to the Holders.
SECTION 5.7 Independent Obligations
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer with respect to the Series B
Capital Securities, and that the Guarantor shall be liable as principal and as
debtor hereunder to make Guarantee Payments pursuant to the terms of this Series
B Capital Securities Guarantee notwithstanding the occurrence of any event
referred to in subsections (a) through (h), inclusive, of Section 5.3 hereof.
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions
So long as any Capital Securities remain outstanding, the
Guarantor shall not (i) declare or pay any dividends or distributions on, or
redeem, purchase, acquire or make a liquidation payment with respect to, any of
the Guarantor's capital stock (which includes common and preferred stock) or
(ii) make any payment of principal of or premium, if any, or interest on or
repay, repurchase or redeem any debt securities of the Guarantor (including
Other Debentures) that rank pari passu with or junior in right of payment to the
Debentures or (iii) make any guarantee payments with respect to any guarantee by
the Guarantor of the debt securities of any subsidiary of the Guarantor
(including Other Guarantees) if such guarantee
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<PAGE> 21
ranks pari passu with or junior in right of payment to the Debentures (other
than (a) dividends or distributions in shares of, or options, warrants, rights
to subscribe for or purchase shares of, common stock of the Guarantor, (b) any
declaration of a dividend in connection with the implementation of a
stockholders' rights plan, or the issuance of stock under any such plan in the
future, or the redemption or repurchase of any such rights pursuant thereto, (c)
payments under the Series B Capital Securities Guarantee, (d) the purchase of
fractional shares resulting from a reclassification of the Guarantor's capital
stock, (e) the exchange or the conversion of one class, or series of the
Guarantor's capital stock for another class or series of the Guarantor's capital
stock, and (f) the purchase of fractional interests in shares of the Guarantor's
capital stock pursuant to the conversion or exchange provisions of such capital
stock or the security being converted or exchanged) if at such time (1) there
shall have occurred and be continuing an event of default under the Declaration,
(2) there shall have occurred and be continuing an Event of Default under the
Indenture, (3) there shall have occurred and be continuing a payment default
under the Declaration or the Indenture, (4) if the Debentures are held by the
Issuer, the Guarantor shall be in default with respect to its payment of any
obligations under this Agreement, or (5) the Guarantor shall have given notice
of its election of an Extension Period as provided in this Indenture and shall
not have rescinded such notice, and such Extension Period, or any extension
thereof, shall have commenced.
SECTION 6.2 Ranking
This Series B Capital Securities Guarantee will constitute an
unsecured obligation of the Guarantor and will rank (i) subordinate and junior
in right of payment to Senior Indebtedness (as defined in the Indenture), to the
same extent and in the same manner that the Debentures are subordinated to
Senior Indebtedness pursuant to the Indenture, it being understood that the
terms of Article XV of the Indenture shall apply to the obligations of the
Guarantor under this Series B Capital Securities Guarantee as if (x) such
Article XV were set forth herein in full and (y) such obligations were
substituted for the term "Securities" appearing in such Article XV, (ii) pari
passu with the Debentures, the Other Debentures and with the most senior
preferred or preference stock now or hereafter issued by the Guarantor and with
any Other Guarantee (as defined herein) and any Other Common Securities
Guarantee and any guarantee now or hereafter entered into by the Guarantor in
respect of any preferred or preference stock of any Affiliate of the Guarantor,
and (iii) senior to the Guarantor's common stock.
ARTICLE VII
TERMINATION
SECTION 7.1 Termination
This Series B Capital Securities Guarantee shall terminate (i)
upon full payment of the Redemption Price (as defined in the Declaration) of all
Series B Capital Securities, (ii) upon liquidation of the Issuer, the full
payment of the amounts payable in accordance with the
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Declaration or the distribution of the Debentures to the Holders of all of the
Series B Capital Securities. Notwithstanding the foregoing, this Series B
Capital Securities Guarantee will continue to be effective or will be
reinstated, as the case may be, if at any time any Holder must restore payment
of any sums paid under the Series B Capital Securities or under this Series B
Capital Securities Guarantee.
ARTICLE VIII
COMPENSATION AND EXPENSES OF
CAPITAL SECURITIES GUARANTEE TRUSTEE
The Guarantor covenants and agrees to pay to the Capital
Securities Guarantee Trustee from time to time, and the Capital Securities
Guarantee Trustee shall be entitled to, such compensation as shall be agreed to
in writing between the Guarantor and the Capital Securities Guarantee Trustee
(which shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust), and the Guarantor will pay or
reimburse the Capital Securities Guarantee Trustee upon its request for all
reasonable expenses, disbursements and advances incurred or made by the Capital
Securities Guarantee Trustee in accordance with any of the provisions of this
Capital Securities Guarantee (including the reasonable compensation and the
expenses and disbursements of its counsel and of all persons not regularly in
its employ) except any such expense, disbursement or advance as may arise from
its negligence or bad faith. The Guarantor also covenants to indemnify each of
the Capital Securities Guarantee Trustee (and its officers, agents, directors
and employees) for, and to hold it harmless against, any and all loss, damage,
claim, liability or expense including taxes (other than taxes based on the
income of the Capital Securities Guarantee Trustee) incurred without negligence
or bad faith on the part of the Capital Securities Guarantee Trustee and arising
out of or in connection with the acceptance or administration of this guarantee,
including the costs and expenses of defending itself against any claim of
liability in the premises. The obligations of the Guarantor under this Article
VIII to compensate and indemnify the Capital Securities Guarantee Trustee and to
pay or reimburse the Capital Securities Guarantee Trustee for expenses,
disbursements and advances shall be secured by a lien prior to that of the
Series B Capital Securities upon all property and funds held or collected by the
Capital Securities Guarantee Trustee as such, except funds held in trust for the
benefit of the holders of particular Series B Capital Securities.
The provisions of this Article shall survive the termination
of this Capital Securities Guarantee.
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<PAGE> 23
ARTICLE IX
INDEMNIFICATION
SECTION 9.1 Exculpation
(a) No Indemnified Person shall be liable, responsible or accountable
in damages or otherwise to the Guarantor or any Covered Person for any loss,
damage or claim incurred by reason of any act or omission performed or omitted
by such Indemnified Person in good faith in accordance with this Series B
Capital Securities Guarantee and in a manner that such Indemnified Person
reasonably believed to be within the scope of the authority conferred on such
Indemnified Person by this Series B Capital Securities Guarantee or by law,
except that an Indemnified Person shall be liable for any such loss, damage or
claim incurred by reason of such Indemnified Person's negligence or willful
misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Guarantor and upon such information, opinions,
reports or statements presented to the Guarantor by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Guarantor, including information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and amount of assets from
which Distributions to Holders might properly be paid.
SECTION 9.2 Indemnification
The Guarantor agrees to indemnify each Indemnified Person for,
and to hold each Indemnified Person harmless against, any and all loss,
liability, damage, claim or expense incurred without negligence or bad faith on
its part, arising out of or in connection with the acceptance or administration
of the trust or trusts hereunder, including the costs and expenses (including
reasonable legal fees and expenses) of defending itself against, or
investigating, any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder. The obligation to
indemnify as set forth in this Section 9.2 shall survive the termination of this
Series B Capital Securities Guarantee.
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ARTICLE X
MISCELLANEOUS
SECTION 10.1 Successors and Assigns
All guarantees and agreements contained in this Series B
Capital Securities Guarantee shall bind the successors, assigns, receivers,
trustees and representatives of the Guarantor and shall inure to the benefit of
the Holders then outstanding.
SECTION 10.2 Amendments
Except with respect to any changes that do not materially
adversely affect the rights of Holders (in which case no consent of Holders will
be required), this Series B Capital Securities Guarantee may only be amended
with the prior approval of the Holders of a Majority in liquidation amount of
the Securities (including the stated amount that would be paid on redemption,
liquidation or otherwise, plus accrued and unpaid Distributions to the date upon
which the voting percentages are determined). The provisions of the Declaration
with respect to consents to amendments thereof (whether at a meeting or
otherwise) shall apply to the giving of such approval.
SECTION 10.3 Notices
All notices provided for in this Series B Capital Securities
Guarantee shall be in writing, duly signed by the party giving such notice, and
shall be delivered, telecopied or mailed by first class mail, as follows:
(a) If given to the Issuer, in care of the Administrative
Trustee at the Issuer's mailing address set forth below (or such other address
as the Issuer may give notice of to the Holders and the Capital Securities
Guarantee Trustee):
AGL Capital Trust
c/o AGL Resources Inc.
303 Peachtree Street
Atlanta, Georgia 30308
Attention: J. Michael Riley
Telecopy: 404-584-3945
(b) If given to the Capital Securities Guarantee Trustee, at
the Capital Securities Guarantee Trustee's mailing address set forth below (or
such other address as the Capital Securities Guarantee Trustee may give notice
of to the Holders and the Issuer):
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<PAGE> 25
The Bank of New York
101 Barclay Street, 21 West
New York, New York 10286
Attention: Corporate Trust Trustee Administration
Telecopy: 212-815-5915
(c) If given to the Guarantor, at the Guarantor's mailing
address set forth below (or such other address as the Guarantor may give notice
of to the Holders of the Series B Capital Securities and the Capital Securities
Guarantee Trustee):
AGL Resources Inc.
303 Peachtree Street
Atlanta, Georgia 30308
Attention: J. Michael Riley
Telecopy: 404-584-3945
(d) If given to any Holder of Series B Capital Securities, at
the address set forth on the books and records of the Issuer.
All such notices shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first class
mail, postage prepaid except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no notice
was given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.
SECTION 10.4 Reserved
SECTION 10.5 Benefit
This Series B Capital Securities Guarantee is solely for the
benefit of the Holders and, subject to Section 3.1(a), is not separately
transferable from the Series B Capital Securities.
SECTION 10.6 Governing Law
THIS SERIES B CAPITAL SECURITIES GUARANTEE SHALL BE GOVERNED
BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF.
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<PAGE> 26
THIS SERIES B CAPITAL SECURITIES GUARANTEE is executed as of
the day and year first above written.
AGL RESOURCES INC.,
as Guarantor
By:
-----------------------------------------
Name:
Title:
THE BANK OF NEW YORK,
as Capital Securities Guarantee Trustee
By:
-----------------------------------------
Name:
Title:
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<PAGE> 1
EXHIBIT 4.8
REGISTRATION RIGHTS AGREEMENT
DATED JUNE 11, 1997
AMONG
AGL RESOURCES INC.
AGL CAPITAL TRUST
AND
MERRILL LYNCH & CO.,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,
GOLDMAN, SACHS & CO.
AND
SALOMON BROTHERS INC.
AS INITIAL PURCHASERS
<PAGE> 2
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made
and entered into as of June 11, 1997 among AGL RESOURCES INC., a Georgia
corporation (the "Company"), AGL CAPITAL TRUST , a business trust formed under
the laws of the state of Delaware (the "Trust"), and MERRILL LYNCH & CO.,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED ("Merrill Lynch"), and
GOLDMAN, SACHS & CO. and SALOMON BROTHERS INC. (together with Merrill Lynch, the
"Initial Purchasers").
This Agreement is made pursuant to the Purchase Agreement
dated June 11, 1997 (the "Purchase Agreement"), among the Company, as issuer of
the Series A 8.17% Junior Subordinated Deferrable Interest Debentures due 2037
(the "Junior Subordinated Debentures"), the Trust and the Initial Purchasers,
which provides for among other things, the sale by the Trust to the Initial
Purchasers of 75,000 of the Trust's Series A 8.17% Capital Securities,
liquidation amount $1,000 per Capital Security (the "Capital Securities"), the
proceeds of which will be used by the Trust to purchase Junior Subordinated
Debentures. The Capital Securities, together with the Junior Subordinated
Debentures and the Company's guarantee of the Capital Securities (the
"Guarantee") are collectively referred to as the "Securities". In order to
induce the Initial Purchasers to enter into the Purchase Agreement, the Company
and the Trust have agreed to provide to the Initial Purchasers and their direct
and indirect transferees the registration rights set forth in this Agreement.
The execution and delivery of this Agreement is a condition to the closing under
the Purchase Agreement.
In consideration of the foregoing, the parties hereto agree as
follows:
1. Definitions. As used in this Agreement, the following
capitalized defined terms shall have the following meanings:
"Advice" shall have the meaning set forth in the last paragraph of
Section 3 hereof.
"Applicable Period" shall have the meaning set forth in Section 3(t)
hereof.
"Business Day" means any day other than a Saturday, a Sunday, or a day
on which banking institutions in the City of New York are authorized or required
by law or executive order to close.
"Capital Securities" shall have the meaning set forth in the preamble
hereof.
"Closing Time" shall mean the Closing Time as defined in the Purchase
Agreement.
"Company" shall have the meaning set forth in the preamble to this
Agreement and also includes the Company's successors and permitted assigns.
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<PAGE> 3
"Declaration" or "Declaration of Trust" shall mean the Amended and
Restated Declaration of Trust, dated as of June 11, 1997, of AGL Capital Trust
by the trustees named therein and the Company as sponsor.
"Depositary" shall mean The Depository Trust Company, or any other
depositary appointed by the Trust; provided, however, that such depositary must
have an address in the Borough of Manhattan, in The City of New York.
"Effectiveness Period" shall have the meaning set forth in Section 2(b)
hereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time.
"Exchange Offer" shall mean the offer by the Company and the Trust to
the Holders to exchange all of the Registrable Securities (other than Private
Exchange Securities) for a like principal amount of Exchange Securities pursuant
to Section 2(a) hereof.
"Exchange Offer Registration" shall mean a registration under the
Securities Act effected pursuant to Section 2(a) hereof.
"Exchange Offer Registration Statement" shall mean an exchange offer
registration statement on Form S-4 (or, if applicable, on another appropriate
form), and all amendments and supplements to such registration statement, in
each case including the Prospectus contained therein, all exhibits thereto and
all material incorporated by reference therein.
"Exchange Period" shall have the meaning set forth in Section 2(a)
hereof.
"Exchange Securities" shall mean (i) with respect to the Junior
Subordinated Debentures, the Series B 8.17% Junior Subordinated Deferrable
Interest Debentures due June 1, 2037 (the "Exchange Debentures") containing
terms identical to the Junior Subordinated Debentures (except that they will not
contain terms with respect to the transfer restrictions under the Securities
Act, will not require transfers thereof to be in minimum blocks of $100,000
principal amount and will not provide for any increase in the interest rate
thereon), (ii) with respect to the Capital Securities, the Trust's Series B
8.17% Capital Securities, liquidation amount $1,000 per Capital Security (the
"Exchange Capital Securities") which will have terms identical to the Capital
Securities (except they will not contain terms with respect to transfer
restrictions under the Securities Act, will not require minimum transfers
thereof to be in blocks of $100,000 liquidation amount and will not provide for
any increase in the Distribution rate thereon) and (iii) with respect to the
Capital Securities Guarantee, the Company's guarantee (the "Exchange Guarantee")
of the Exchange Capital Securities which will have terms identical to the
Guarantee.
"Guarantee" shall have the meaning set forth in the preamble hereof.
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<PAGE> 4
"Holder" shall mean the Initial Purchasers, for so long as they own any
Registrable Securities, and each of their respective successors, assigns and
direct and indirect transferees who become registered owners of Registrable
Securities under the Indenture or Declaration of Trust.
"Indenture" shall mean the Indenture relating to the Junior
Subordinated Debentures and the Exchange Debentures dated as of June 11, 1997
among the Company, as issuer, and The Bank of New York, as trustee, as the same
may be amended from time to time in accordance with the terms thereof.
"Initial Purchasers" shall have the meaning set forth in the preamble
to this Agreement.
"Inspectors" shall have the meaning set forth in Section 3(n) hereof.
"Issue Date" shall mean the date of original issuance of the
Securities.
"Junior Subordinated Debentures" shall have the meaning set forth in
the preamble hereof.
"Liquidated Damages" shall have the meaning set forth in Section 2(e)
hereof.
"Majority Holders" shall mean the Holders of a majority of the
aggregate liquidation amount of outstanding Capital Securities.
"Merrill Lynch" shall have the meaning set forth in the preamble
hereof.
"Participating Broker-Dealer" shall have the meaning set forth in
Section 3(t) hereof.
"Person" shall mean an individual, partnership, corporation, trust or
unincorporated organization, limited liability company, or a government or
agency or political subdivision thereof.
"Private Exchange" shall have the meaning set forth in Section 2(a)
hereof.
"Private Exchange Debentures" shall have the meaning set forth in
Section 2(a) hereof.
"Private Exchange Securities" shall have the meaning set forth in
Section 2(a) hereof.
"Prospectus" shall mean the prospectus included in a Registration
Statement, including any preliminary prospectus, and any such prospectus as
amended or supplemented by any prospectus supplement, including a prospectus
supplement with respect to the terms of the offering of any portion of the
Registrable Securities covered by a Shelf Registration Statement, and by all
other amendments and supplements to a prospectus, including post-effective
amendments, and in each case including all material incorporated by reference
therein.
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<PAGE> 5
"Purchase Agreement" shall have the meaning set forth in the preamble
to this Agreement.
"Records" shall have the meaning set forth in Section 3(n) hereof.
"Registration Default" shall have the meaning set forth in Section 2(e)
hereof.
"Registrable Securities" shall mean the Securities and, if issued, the
Private Exchange Securities; provided, however, that Securities or Private
Exchange Securities, as the case may be, shall cease to be Registrable
Securities when (i) a Registration Statement with respect to such Securities or
Private Exchange Securities for the exchange or resale thereof, as the case may
be, shall have been declared effective under the Securities Act and such
Securities or Private Exchange Securities, as the case may be, shall have been
disposed of pursuant to such Registration Statement, (ii) such Securities or
Private Exchange Securities, as the case may be, shall be eligible to be sold to
the public pursuant to Rule 144(k) (or any similar provision then in force, but
not Rule 144A) under the Securities Act, (iii) such Securities or Private
Exchange Securities, as the case may be, shall have ceased to be outstanding,
(iv) with respect to the Securities, such Securities have been exchanged for
Exchange Securities upon consummation of the Exchange Offer and are thereafter
freely tradeable by the holder thereof (other than an affiliate of the Company)
without registration under the Securities Act, or (v) such Securities or Private
Exchange Securities become freely tradeable by the holder thereof (other than an
affiliate of the Company) without registration under the Securities Act.
"Registration Expenses" shall mean any and all expenses incident to
performance of or compliance by the Company with this Agreement, including
without limitation: (i) all SEC or National Association of Securities Dealers,
Inc. (the "NASD") registration and filing fees; (ii) all fees and expenses
incurred in connection with compliance with state securities or blue sky laws
(including reasonable fees and disbursements of counsel to the Company in
connection with blue sky qualification of any of the Exchange Securities or
Registrable Securities) and compliance by the Company and the Trust with the
rules of the NASD; (iii) internal expenses of the Company; (iv) all rating
agency fees; (v) the fees and disbursements of counsel for the Company and of
the independent certified public accountants of the Company; (vi) the fees and
expenses of the Trustee, and any exchange agent or custodian; (vii) all fees and
expenses incurred by the Company or the Trust in connection with the listing, if
any, of any of the Registrable Securities on any securities exchange or
exchanges; and (viii) the reasonable fees and expenses of any special experts
retained by the Company in connection with any Registration Statement.
"Registration Statement" shall mean any registration statement of the
Company and the Trust which covers any of the Exchange Securities or Registrable
Securities pursuant to the provisions of this Agreement, and all amendments and
supplements to any such Registration Statement, including post-effective
amendments, in each case including the Prospectus contained therein, all
exhibits thereto and all material incorporated by reference therein.
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<PAGE> 6
"Rule 144(k) Period" shall mean the period of two years (or such
shorter period as may hereafter be referred to in Rule 144(k) under the
Securities Act (or similar successor rule)) commencing on the Issue Date.
"SEC" shall mean the Securities and Exchange Commission.
"Securities" shall have the meaning set forth in the preamble to this
Agreement.
"Securities Act" shall mean the Securities Act of 1933, as amended from
time to time.
"Shelf Registration" shall mean a registration effected pursuant to
Section 2(b) hereof.
"Shelf Registration Event" shall have the meaning set forth in Section
2(b) hereof.
"Shelf Registration Event Date" shall have the meaning set forth in
Section 2(b) hereof.
"Shelf Registration Statement" shall mean a "shelf" registration
statement of the Company and the Trust pursuant to the provisions of Section
2(b) hereof which covers all of the Registrable Securities or all of the Private
Exchange Securities, as the case may be, on an appropriate form under Rule 415
under the Securities Act, or any similar rule that may be adopted by the SEC,
and all amendments and supplements to such registration statement, including
post-effective amendments, in each case including the Prospectus contained
therein, all exhibits thereto and all material incorporated by reference
therein.
"TIA" shall have the meaning set forth in Section 3(l) hereof.
"Trust" shall have the meaning set forth in the preamble hereof.
"Trustees" shall mean any and all trustees with respect to (i) the
Capital Securities under the Declaration, (ii) the Junior Subordinated
Debentures under the Indenture and (iii) the Capital Securities Guarantee.
2. Registration Under the Securities Act.
(a) Exchange Offer. To the extent not prohibited by any
applicable law or applicable interpretation of the staff of the SEC and subject
to the conditions hereinafter set forth, the Company and the Trust shall, for
the benefit of the Holders, at the Company's cost, use its reasonable best
efforts to (i) cause to be filed with the SEC within 150 days after the Issue
Date an Exchange Offer Registration Statement on an appropriate form under the
Securities Act covering the Exchange Offer, (ii) cause such Exchange Offer
Registration Statement to be declared effective under the Securities Act by the
SEC not later than the date which is 200 days after the Issue Date, and (iii)
keep such Exchange Offer Registration Statement effective for not less than 30
calendar days (or longer if required by applicable law) after the date notice of
the Exchange Offer is mailed to the Holders. Upon the effectiveness of the
Exchange Offer Registration Statement, the Company and the Trust shall promptly
commence the Exchange Offer, it
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<PAGE> 7
being the objective of such Exchange Offer to enable each Holder eligible and
electing to exchange Registrable Securities for a like principal amount of
Exchange Debentures or a like liquidation amount of Exchange Capital Securities,
together with the Exchange Guarantee, as applicable (assuming that such Holder
is not an affiliate of the Company within the meaning of Rule 405 under the
Securities Act and is not a broker-dealer tendering Registrable Securities
acquired directly from the Company for its own account, acquires the Exchange
Securities in the ordinary course of such Holder's business and has no
arrangements or understandings with any Person to participate in the Exchange
Offer for the purpose of distributing the Exchange Securities) to transfer such
Exchange Securities from and after their receipt without any limitations or
restrictions under the Securities Act and under state securities or blue sky
laws.
In connection with the Exchange Offer, the Company and the
Trust shall:
(i) mail or cause to be mailed to each Holder a copy of the Prospectus
forming part of the Exchange Offer Registration Statement, together with an
appropriate letter of transmittal and related documents;
(ii) keep the Exchange Offer open for acceptance for a period of not
less than 30 days after the date notice thereof is mailed to the Holders (or
longer if required by applicable law) (such period referred to herein as the
"Exchange Period");
(iii) utilize the services of the Depositary for the Exchange Offer;
(iv) permit Holders to withdraw tendered Securities at any time prior
to the close of business, New York time, on the last Business Day of the
Exchange Period, by sending to the institution specified in the notice, a
telegram, telex, facsimile transmission or letter setting forth the name of such
Holder, the principal amount of Securities delivered for exchange, and a
statement that such Holder is withdrawing his election to have such Securities
exchanged;
(v) notify each Holder that any Security not tendered by such Holder in
the Exchange Offer will remain outstanding and continue to accrue interest or
accumulate distributions, as the case may be, but will not retain any rights
under this Agreement (except in the case of the Initial Purchasers and
Participating Broker-Dealers as provided herein); and
(vi) otherwise comply in all respects with all applicable laws relating
to the Exchange Offer.
If any Initial Purchaser determines, upon receipt of an
opinion of its outside counsel to the effect, that it is not eligible to
participate in the Exchange Offer with respect to the exchange of Securities
constituting any portion of an unsold allotment in the initial distribution, as
soon as practicable upon receipt by the Company and the Trust of a written
request from such Initial Purchaser, the Company and the Trust, as applicable,
shall issue and deliver to such Initial Purchaser in exchange (the "Private
Exchange") for the Securities held by such Initial Purchaser, a like liquidation
amount of Capital Securities of the Trust, together with the Exchange Guarantee,
or a like principal amount of the Junior Subordinated Debentures of the Company
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<PAGE> 8
(the "Private Exchange Debentures") , as applicable, that are identical (except
that such securities may bear a customary legend with respect to restrictions on
transfer pursuant to the Securities Act) to the Exchange Securities (the
"Private Exchange Securities") and which are issued pursuant to the Indenture,
the Declaration or the Guarantee (which provides that the Exchange Securities
will not be subject to the transfer restrictions set forth in the Indenture or
the Declaration, as applicable, other than restrictions on transfer pursuant to
the Securities Act, and that the Exchange Securities, the Private Exchange
Securities and the Securities will vote and consent together on all matters as
one class and that neither the Exchange Securities, the Private Exchange
Securities nor the Securities will have the right to vote or consent as a
separate class on any matter). The Private Exchange Securities shall be of the
same series as the Exchange Securities and the Company and the Trust will seek
to cause the CUSIP Service Bureau to issue the same CUSIP Numbers for the
Private Exchange Securities as for the Exchange Securities issued pursuant to
the Exchange Offer.
As soon as practicable after the close of the Exchange Offer
and, if applicable, the Private Exchange, the Company and the Trust, as the case
requires, shall:
(i) accept for exchange all Securities or portions thereof tendered and
not validly withdrawn pursuant to the Exchange Offer or the Private Exchange;
(ii) deliver, or cause to be delivered, to the applicable Trustee for
cancellation all Securities or portions thereof so accepted for exchange by the
Company; and
(iii) issue, and cause the applicable Trustee under the Indenture, the
Declaration or the Guarantee, as applicable, to promptly authenticate and
deliver to each Holder who tenders and does not validly withdraw Securities in
the Exchange Offer, new Exchange Securities or Private Exchange Securities, as
applicable, equal in principal amount to the principal amount of the Junior
Subordinated Debentures or equal in liquidation amount to the liquidation amount
to the Capital Securities (together with the Guarantee) as are surrendered by
such Holder.
Distributions on each Exchange Capital Security and interest
on each Exchange Debenture and Private Exchange Security issued pursuant to the
Exchange Offer and in the Private Exchange will accrue from the last date on
which a Distribution or interest was paid on the Capital Security or the Junior
Subordinated Debenture surrendered in exchange therefore or, if no Distribution
or interest has been paid on such Capital Security or Subordinated Debenture,
from the Issue Date. To the extent not prohibited by any law, rule, regulation
or applicable interpretation of the staff of the SEC, the Company and the Trust
shall use their reasonable best efforts to complete the Exchange Offer as
provided above, and shall comply with the applicable requirements of the
Securities Act, the Exchange Act and other applicable laws in connection with
the Exchange Offer. The Exchange Offer shall not be subject to any conditions
except as set forth or contemplated herein, other than that the Exchange Offer
does not violate applicable law or any applicable interpretation of the staff of
the SEC. Each Holder of Registrable Securities who wishes to exchange such
Registrable Securities for Exchange Securities in the Exchange Offer will be
required to make certain customary representations in connection there with,
including, in the case of any Holder of Capital Securities, representations that
(i) it is not an
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<PAGE> 9
affiliate of the Trust or the Company, (ii) the Exchange Securities to be
received by it were acquired in the ordinary course of its business and (iii) at
the time of the Exchange Offer, it has no arrangement with any Person to
participate in the distribution (within the meaning of the Securities Act) of
the Exchange Securities. The Company and the Trust shall inform the Initial
Purchasers, after consultation with the Trustee, of the names and addresses of
the Holders to whom the Exchange Offer is made, and the Initial Purchasers shall
have the right to contact such Holders and otherwise facilitate the tender of
Registrable Securities in the Exchange Offer.
Upon consummation of the Exchange Offer in accordance with
this Section 2(a), the provisions of this Agreement shall continue to apply,
mutatis mutandis, solely with respect to Registrable Securities that are Private
Exchange Securities and Exchange Securities held by Participating
Broker-Dealers, and the Company and the Trust shall have no further obligation
to register the Registrable Securities (other than Private Exchange Securities)
pursuant to Section 2(b) of this Agreement.
(b) Shelf Registration. (1) If because of any change in law or
in the applicable interpretations of the staff of the SEC, the Company and the
Trust are not permitted to effect the Exchange Offer on the terms set forth
herein, (2) if for any reason the Exchange Offer Registration Statement is not
declared effective within 200 days of the Issue Date, (3) upon the request of
the Initial Purchasers, (4) if the Company shall receive an opinion of counsel
experienced in such matters to the effect that, as a result of 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, or as a result of any official
administrative pronouncement or judicial decision interpreting or applying such
laws or regulations, which amendment or change is effective or such
pronouncement or decision is announced or made effective on or after the Issue
Date, there is more than an insubstantial risk that (a) the Trust is, or will be
within 90 days of the date of such opinion, subject to United States federal
income tax with respect to all or part of the income received or accrued on the
Junior Subordinated Debentures, the Exchange Debentures or the Private Exchange
Debentures, (b) interest payable by AGL Resources on the Junior Subordinated
Debentures, the Exchange Debentures or the Private Exchange Debentures is not,
or within 90 days of the date of such opinion will not be, deductible by AGL
Resources, in whole or in part, for United States federal income tax purposes,
or (c) the Trust is, or will be within 90 days of the date of such opinion,
subject to more than a de minimis amount of other taxes, duties or other
governmental charges, or (5) if in the reasonable opinion of counsel experienced
in such matters, pursuant to applicable law or applicable interpretations of the
staff of the SEC, the Initial Purchasers are not permitted to participate in the
Exchange Offer and thereby receive securities that are freely tradeable without
restriction under the Securities Act and applicable blue sky or state securities
laws (each such event being a "Shelf Registration Event" and the date of
occurrence thereof, the "Shelf Registration Event Date"), then in addition to
or, in the discretion of the Company, in lieu of effecting the registration of
the Exchange Securities pursuant to the Exchange Offer Registration Statement,
the Administrative Trustees (as that term is defined in the Declaration) on
behalf of the Trust will (x) promptly deliver to the holders and the Delaware
Trustee (as that term is defined in the Declaration) written notice thereof and
(y) at the Company's sole expense, (A) as promptly as reasonably practicable,
file a shelf registration covering resales of the Registrable
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<PAGE> 10
Securities, (B) use their reasonable best efforts to cause the Shelf
Registration Statement to be declared effective under the Securities Act and (C)
use their reasonable best efforts to keep effective the Shelf Registration
Statement until the earlier of two years after the Issue Date (180 days in the
case of a Shelf Registration Statement filed at the request of the Initial
Purchasers) or such time as all of the Registrable Securities have been sold
thereunder or otherwise cease to be Registrable Securities ("Effectiveness
Period"). The Company will, in the event that a Shelf Registration Statement is
filed, provide to each holder copies of the prospectus that is a part of the
Shelf Registration Statement, notify each such holder when the Shelf
Registration Statement for the Registrable Securities has become effective and
take certain other actions as are reasonably required to permit unrestricted
resales of the Registrable Securities.
No Holder of Registrable Securities shall be entitled to
include any of its Registrable Securities in any Shelf Registration pursuant to
this Agreement unless and until such Holder agrees in writing to be bound by all
of the provisions of this Agreement applicable to such Holder and furnishes to
the Company and the Trust in writing, within 15 days after receipt of a request
therefor, such information as the Company and the Trust may, after conferring
with counsel with regard to information relating to Holders that would be
required by the SEC to be included in such Shelf Registration Statement or
Prospectus included therein, reasonably request for inclusion in any Shelf
Registration Statement or Prospectus included therein. Each Holder as to which
any Shelf Registration is being effected agrees to furnish to the Company and
the Trust all information with respect to such Holder necessary to make the
information previously furnished to the Company by such Holder not materially
misleading.
The Company and the Trust shall not permit any securities
other than Registrable Securities to be included in the Shelf Registration. The
Company and the Trust further agree, if necessary, to supplement or amend the
Shelf Registration Statement, if required by the rules, regulations or
instructions applicable to the registration form used by the Company for such
Shelf Registration Statement or by the Securities Act or by any other rules and
regulations thereunder for shelf registrations, and the Company and the Trust
agree to furnish to the Holders of Registrable Securities copies of any such
supplement or amendment promptly after its being used or filed with the SEC.
(c) Expenses. The Company shall pay all Registration Expenses
in connection with the registration pursuant to Section 2(a) or 2(b) hereof.
Except as provided herein, each Holder, including without limitation the Initial
Purchasers, shall pay all expenses of its counsel, underwriting discounts and
commissions and transfer taxes, if any, relating to the sale or disposition of
such Holder's Registrable Securities pursuant to the Shelf Registration
Statement.
(d) Effective Registration Statement. An Exchange Offer
Registration Statement pursuant to Section 2(a) hereof or a Shelf Registration
Statement pursuant to Section 2(b) hereof will not be deemed to have become
effective unless it has been declared effective by the SEC; provided, however,
that if, after it has been declared effective, the offering of Registrable
Securities pursuant to a Shelf Registration Statement is interfered with by any
stop order, injunction or other order or requirement of the SEC or any other
governmental agency or court, such Registration Statement will be deemed not to
have been effective during the period of such
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<PAGE> 11
interference, until the offering of Registrable Securities pursuant to such
Registration Statement may legally resume.
(e) Liquidated Damages and Additional Distributions. In the
event that (i) (A) the Exchange Offer Registration Statement or a Shelf
Registration Statement is not filed with the SEC on or prior to the 150th day
after the Issue Date as required herein or (B) notwithstanding that the Company
and the Trust have consummated or will consummate an Exchange Offer, if the
Company and the Trust are required to file a Shelf Registration Statement and
such Shelf Registration Statement is not filed on or prior to the date required
by Section 2(b) hereof, then commencing on the day after the applicable required
filing date, (x) an additional amount (being liquidated damages) shall accrue on
the principal amount of the Junior Subordinated Debentures, and (y) additional
distributions shall accumulate on the liquidation amount of the Capital
Securities, each at a rate of 0.25% per annum; or
(ii) (A) (1) the Exchange Offer Registration Statement is not
declared effective by the SEC on or prior to the 200th day after the Issue Date
or (2) a Shelf Registration Statement is not declared effective by the SEC on or
prior to the later of the 50th day after the applicable required filing date or
the 200th day after the Issue Date or (B) notwithstanding that the Company and
the Trust have consummated an Exchange Offer, the Company and the Trust are
required to file a Shelf Registration Statement and such Shelf Registration
Statement is not declared effective by the SEC on or prior to the later of the
50th day after the date such Shelf Registration Statement was required to be
filed or the 200th day after the Issue Date, then, commencing on the 201st day
after the Issue Date with respect to the Exchange Offer Registration Statement
or the 51st day after the applicable required filing date (or the 201st day
after the Issue Date, if later), (x) an additional amount (being liquidated
damages) shall accrue on the principal amount of the Junior Subordinated
Debentures, and (y) additional distributions shall accumulate on the liquidation
amount of the Capital Securities, each at a rate of 0.25% per annum; or
(iii) (A) if applicable, the Trust has not exchanged Exchange Capital
Securities for all Capital Securities or the Company has not exchanged Exchange
Guarantees or Exchange Debentures for all Guarantees or Junior Subordinated
Debentures validly tendered, in accordance with the terms of the Exchange Offer
on or prior to the 45th day after the date on which the Exchange Offer
Registration Statement was declared effective or (B) if applicable, the Shelf
Registration Statement has been declared effective and such Shelf Registration
Statement ceases to be available to a Holder of Registrable Securities for use
in connection with the sale of such Registrable Securities at any time prior to
the second anniversary of the Issue Date (other than after such time as all
Capital Securities have been disposed of thereunder or otherwise cease to be
Registrable Securities), and such event continues for a period exceeding 30
consecutive days or 90 days in any 360 day period whether or not consecutive,
then (x) an additional amount (being liquidated damages) shall accrue on the
principal amount of Junior Subordinated Debentures, and (y) additional
distributions shall accumulate on the liquidation amount of the Capital
Securities, each at a rate of 0.25% per annum commencing on (i) the 46th day
after such effective date, in the case of (A) above, or (ii) the 31st
consecutive day or 91st day in any 360 day period following the day such Shelf
Registration Statement ceases to be available in the case of (B) above;
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<PAGE> 12
provided, however, that neither the additional amounts (being liquidated
damages) on the Junior Subordinated Debentures, the Exchange Debentures and the
Private Exchange Debentures, nor the additional distribution rate on the
liquidation amount of the Capital Securities, the Exchange Capital Securities
and the Private Exchange Capital Securities, may exceed in the aggregate 0.25%
per annum; provided, further, however, that (1) upon the filing of the Exchange
Offer Registration Statement or a Shelf Registration Statement (in the case of
clause (i) above), (2) upon the effectiveness of the Exchange Offer Registration
Statement or a Shelf Registration Statement (in the case of clause (ii) above),
or (3) upon the exchange of Exchange Capital Securities, Exchange Guarantees and
Exchange Debentures for all Capital Securities, Guarantees and Junior
Subordinated Debentures tendered (in the case of clause (iii)(A) above), or upon
the availability of the Shelf Registration Statement which had ceased to remain
available (in the case of clause (iii)(B) above), additional amounts on the
Junior Subordinated Debentures, the Exchange Debentures and the Private Exchange
Debentures, and additional distributions on the liquidation amount of the
Capital Securities, the Exchange Capital Securities and the Private Exchange
Capital Securities as a result of such clause (or the relevant subclause
thereof), as the case may be, shall cease to accrue or accumulate, as the case
may be.
Any additional amounts and additional distributions due pursuant to
Section 2(e)(i), (ii) or (iii) above (together "Liquidated Damages") will be
payable in cash on the next succeeding June 1 or December 1, as the case may be,
to holders on the relevant record dates for the payment of interest and
distributions pursuant to the Indenture and the Declaration, respectively.
(f) Specific Enforcement. Without limiting the remedies
available to the Holders, the Company and the Trust acknowledge that any failure
by the Company or the Trust to comply with its obligations under Section 2(a)
and Section 2(b) hereof may result in material irreparable injury to the Holders
for which there is no adequate remedy at law, that it would not be possible to
measure damages for such injuries precisely and that, in the event of any such
failure, any Holder may obtain such relief as may be required to specifically
enforce the Company's and the Trust's obligations under Section 2(a) and Section
2(b) hereof.
3. Registration Procedures. In connection with the obligations
of the Company and the Trust with respect to the Registration Statements
pursuant to Sections 2(a) and 2(b) hereof, the Company and the Trust shall use
their reasonable best efforts to:
(a) prepare and file with the SEC a Registration Statement or
Registration Statements as prescribed by Sections 2(a) and 2(b) hereof within
the relevant time period specified in Section 2 hereof on the appropriate form
under the Securities Act, which form (i) shall be selected by the Company and
the Trust, (ii) shall, in the case of a Shelf Registration, be available for the
sale of the Registrable Securities by the selling Holders thereof and (iii)
shall comply as to form in all material respects with the requirements of the
applicable form and include all financial statements required by the SEC to be
filed therewith; and use its reasonable best efforts to cause such Registration
Statement to become effective and remain effective in accordance with Section 2
hereof; provided, however, that if (1) such filing is pursuant to Section 2(b),
or (2) a Prospectus contained in an Exchange Offer Registration Statement filed
pursuant to Section 2(a) is required to be delivered under the Securities Act by
any Participating
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<PAGE> 13
Broker-Dealer who seeks to sell Exchange Securities, before filing any
Registration Statement or Prospectus or any amendments or supplements thereto,
the Company and the Trust shall furnish to and afford the Holders of the
Registrable Securities and each such Participating Broker-Dealer, as the case
may be, covered by such Registration Statement, their counsel and the managing
underwriters, if any, a reasonable opportunity to review copies of all such
documents (including copies of any documents to be incorporated by reference
therein and all exhibits thereto) proposed to be filed;
(b) prepare and file with the SEC such amendments and
post-effective amendments to each Registration Statement as may be necessary to
keep such Registration Statement effective for the Effectiveness Period or the
Applicable Period, as the case may be; and cause each Prospectus to be
supplemented, if so determined by the Company or the Trust or requested by the
SEC, by any required prospectus supplement and as so supplemented to be filed
pursuant to Rule 424 (or any similar provision then in force) under the
Securities Act, and comply with the provisions of the Securities Act, the
Exchange Act and the rules and regulations promulgated thereunder applicable to
it with respect to the disposition of all securities covered by each
Registration Statement during the Effectiveness Period or the Applicable Period,
as the case may be, in accordance with the intended method or methods of
distribution by the selling Holders thereof described in this Agreement
(including sales by any Participating Broker-Dealer);
(c) in the case of a Shelf Registration, (i) notify each
Holder of Registrable Securities included in the Shelf Registration Statement,
at least three Business Days prior to filing, that a Shelf Registration
Statement with respect to the Registrable Securities is being filed and advising
such Holder that the distribution of Registrable Securities will be made in
accordance with the method selected by the Majority Holders; and (ii) furnish to
each Holder of Registrable Securities included in the Shelf Registration
Statement and to each underwriter of an underwritten offering of Registrable
Securities, if any, without charge, as many copies of each Prospectus, including
each preliminary Prospectus, and any amendment or supplement thereto and such
other documents as such Holder or underwriter may reasonably request, in order
to facilitate the public sale or other disposition of the Registrable
Securities; and (iii) consent to the use of the Prospectus or any amendment or
supplement thereto by each of the selling Holders of Registrable Securities
included in the Shelf Registration Statement in connection with the offering and
sale of the Registrable Securities covered by the Prospectus or any amendment or
supplement thereto;
(d) in the case of a Shelf Registration, use its reasonable
best efforts to register or qualify the Registrable Securities under all
applicable state securities or "blue sky" laws of such jurisdictions by the time
the applicable Registration Statement is declared effective by the SEC as any
Holder of Registrable Securities covered by a Registration Statement and each
underwriter of an underwritten offering of Registrable Securities shall
reasonably request in writing in advance of such date of effectiveness, and do
any and all other acts and things which may be reasonably necessary or advisable
to enable such Holder and underwriter to consummate the disposition in each such
jurisdiction of such Registrable Securities owned by such Holder; provided,
however, that the Company and the Trust shall not be required to (i) qualify as
a
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<PAGE> 14
foreign corporation or as a dealer in securities in any jurisdiction where it
would not otherwise be required to qualify but for this Section 3(d), (ii) file
any general consent to service of process in any jurisdiction where it would not
otherwise be subject to such service of process or (iii) subject itself to
taxation in any such jurisdiction if it is not then so subject;
(e) in the case of (1) a Shelf Registration or (2)
Participating Broker-Dealers from whom the Company or the Trust has received
prior written notice that they will be utilizing the Prospectus contained in the
Exchange Offer Registration Statement as provided in Section 3(t) hereof, are
seeking to sell Exchange Securities and are required to deliver Prospectuses,
notify each Holder of Registrable Securities, or such Participating
Broker-Dealers, as the case may be, their counsel and the managing underwriters,
if any, as soon as reasonably practicable and confirm such notice in writing (i)
when a Registration Statement has become effective and when any post-effective
amendments and supplements thereto become effective, (ii) of any request by the
SEC or any state securities authority for amendments and supplements to a
Registration Statement or Prospectus or for additional information, in each
case, after the Registration Statement has become effective, (iii) of the
issuance by the SEC or any state securities authority of any stop order
suspending the effectiveness of a Registration Statement or the qualification of
the Registrable Securities or the Exchange Securities to be offered or sold by
any Participating Broker-Dealer in any jurisdiction described in paragraph 3(d)
hereof or the initiation of any proceedings for that purpose, (iv) of the
happening of any event or the failure of any event to occur or the discovery of
any facts or otherwise, during the Effectiveness Period which to the knowledge
of the Company makes any statement made in such Registration Statement or the
related Prospectus (other than statements or information regarding the selling
Holders or the plan of distribution) untrue in any material respect or which
causes such Registration Statement or Prospectus to omit to state a material
fact necessary to make the statements therein (other than statements or
information regarding the selling Holders or the plan of distribution), in the
light of the circumstances under which they were made, not misleading, and (v)
the Company and the Trust's reasonable determination that a post-effective
amendment to the Registration Statement would be appropriate;
(f) take such reasonable actions as may be reasonably
necessary to obtain the withdrawal of any order suspending the effectiveness of
a Registration Statement;
(g) in the case of a Shelf Registration, furnish to each
Holder of Registrable Securities included within the coverage of such Shelf
Registration Statement, without charge, at least one conformed copy of each
Registration Statement relating to such Shelf Registration and any
post-effective amendment thereto (without documents incorporated therein by
reference or exhibits thereto, unless requested);
(h) in the case of a Shelf Registration, reasonably cooperate
with the selling Holders of Registrable Securities to facilitate the timely
preparation and delivery of certificates representing Registrable Securities to
be sold and not bearing any restrictive legends and in such denominations
(consistent with the provisions of the Indenture and the Declaration) and
registered in such names as the selling Holders or the underwriters may
reasonably request at least
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<PAGE> 15
two Business Days prior to the closing of any sale of Registrable Securities
pursuant to such Shelf Registration Statement;
(i) in the case of a Shelf Registration or an Exchange Offer
Registration, upon the occurrence of any circumstance contemplated by Section
3(e)(ii), 3(e)(iii), 3(e)(iv) or 3(e)(v) hereof, use its reasonable best efforts
to prepare a supplement or post-effective amendment to a Registration Statement
or the related Prospectus or any document incorporated therein by reference or
file any other required document so that, as thereafter delivered to the
purchasers of the Registrable Securities, such Prospectus will not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading; and to notify each Holder to suspend use of the
Prospectus as promptly as practicable after the occurrence of such an event, and
each Holder hereby agrees to suspend the sale of Securities pursuant to such
Prospectus until the Company has amended or supplemented such Prospectus to
correct such misstatement or omission and has furnished copies of the amended or
supplemented prospectus to such holder (or Participating Broker-Dealer, as the
case may be) or the Company has given notice that the sale of the Securities may
be resumed, as the case may be;
(j) obtain a CUSIP number for all Exchange Capital Securities
and the Capital Securities (and if the Trust has made a distribution of the
Junior Subordinated Debentures to the Holders of the Capital Securities, the
Junior Subordinated Debentures or the Exchange Debentures) as the case may be,
not later than the effective date of a Registration Statement, and provide the
Trustee with printed certificates for the Exchange Securities or the Registrable
Securities, as the case may be, in a form eligible for deposit with the
Depositary;
(k) use its reasonable best efforts to cause the Indenture,
the Declaration, the Guarantee and the Exchange Guarantee to be qualified under
the Trust Indenture Act of 1939 (the "TIA") in connection with the registration
of the Exchange Securities or Registrable Securities, as the case may be;
(l) upon consummation of an Exchange Offer or a Private
Exchange, if requested by a Trustee, obtain an opinion of counsel to the Company
addressed to the Trustee for the benefit of all Holders of Registrable
Securities participating in the Exchange Offer or the Private Exchange, as the
case may be, and which includes an opinion substantially to the effect that (i)
the Company and the Trust, as the case requires, has duly authorized, executed
and delivered the Exchange Securities and Private Exchange Securities, and (ii)
each of the Exchange Securities or the Private Exchange Securities, as the case
may be, constitute a legal, valid and binding obligation of the Company or the
Trust, as the case requires, enforceable against the Company or the Trust, as
the case requires, in accordance with its respective terms (in each case, with
customary exceptions);
(m) if an Exchange Offer or a Private Exchange is to be
consummated, upon delivery of the Registrable Securities by Holders to the
Company or the Trust, as applicable (or to such other Person as directed by the
Company or the Trust, respectively), in exchange for the Exchange Securities or
the Private Exchange Securities, as the case may be, the Company or the
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<PAGE> 16
Trust, as applicable, shall mark, or cause to be marked, on such Registrable
Securities delivered by such Holders that such Registrable Securities are being
canceled in exchange for the Exchange Securities or the Private Exchange
Securities, as the case may be; in no event shall such Registrable Securities be
marked as paid or otherwise satisfied;
(n) reasonably cooperate with each seller of Registrable
Securities covered by any Registration Statement and each underwriter, if any,
participating in the disposition of such Registrable Securities and their
respective counsel in connection with any filings required to be made with the
NASD (provided that such filings shall be at the expense of the respective
Holder);
(o) (A) in the case of the Exchange Offer Registration
Statement (i) include in the Exchange Offer Registration Statement a section
entitled "Plan of Distribution," which section shall be reasonably acceptable to
the Initial Purchasers, and which shall contain a summary statement of the
positions taken or policies made by the staff of the SEC, and known to the
Company, with respect to the potential "underwriter" status of any broker-dealer
(a "Participating Broker-Dealer") that holds Registrable Securities acquired for
its own account as a result of market-making activities or other trading
activities and that will be the beneficial owner (as defined in Rule 13d-3 under
the Exchange Act) of Exchange Securities to be received by such broker-dealer in
the Exchange Offer, whether such positions or policies have been publicly
disseminated by the staff of the SEC or such positions or policies, in the
reasonable judgment of the Initial Purchasers or such other representative,
represent the prevailing views of the staff of the SEC, including a statement
that any such broker-dealer who receives Exchange Securities for Registrable
Securities pursuant to the Exchange Offer may be deemed a statutory underwriter
and must deliver a prospectus meeting the requirements of the Securities Act in
connection with any resale of such Exchange Securities, (ii) furnish to each
Participating Broker-Dealer who has delivered to the Company the notice referred
to in Section 3(e), without charge, as many copies of each Prospectus included
in the Exchange Offer Registration Statement, including any prelim inary
prospectus, and any amendment or supplement thereto, as such Participating
Broker-Dealer may reasonably request (each of the Company and the Trust hereby
consents to the use of the Prospectus forming part of the Exchange Offer
Registration Statement or any amendment or supplement thereto by any
Participating Broker-Dealers subject to the prospectus delivery requirements of
the Securities Act, in connection with the sale or transfer of the Exchange
Securities covered by the Prospectus or any amendment or supplement thereto),
(iii) use its reasonable best efforts to keep the Exchange Offer Registration
Statement effective and to amend and supplement the Prospectus contained therein
in order to permit such Prospectus to be lawfully delivered by all Persons
subject to the prospectus delivery requirements of the Securities Act for such
period of time as such Persons must comply with such requirements under the
Securities Act and applicable rules and regulations in order to resell the
Exchange Securities; provided, however, that such period shall not be required
to exceed 180 days (or such longer period if extended pursuant to the last
sentence of Section 3 hereof) (the "Applicable Period"), and (iv) include in the
transmittal letter or similar documentation to be executed by an exchange
offeree in order to participate in the Exchange Offer (x) the following
provision:
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<PAGE> 17
"If the exchange offeree is a broker-dealer holding
Registrable Securities acquired for its own account as a
result of market-making activities or other trading
activities, it is required to deliver a prospectus meeting the
requirements of the Securities Act in connection with any
resale of Exchange Securities received in respect of such
Registrable Securities pursuant to the Exchange Offer";
and
(y) a statement to the effect that by a broker-dealer making
the acknowledgment described in clause (x) and by delivering a Prospectus in
connection with the exchange of Registrable Securities, the broker-dealer will
not be deemed to admit that it is an underwriter within the meaning of the
Securities Act.
The Company or the Trust may require each seller of
Registrable Securities as to which any registration is being effected to furnish
to the Company or the Trust, as applicable, such information regarding such
seller as may be required by applicable law, rule or regulation or by the staff
of the SEC to be included in a Registration Statement. The Company or the Trust
may exclude from such registration the Registrable Securities of any seller who
fails to furnish such information within a reasonable time after receiving such
request. The Company shall have no obligation to register under the Securities
Act the Registrable Securities of a seller who so fails to furnish such
information.
In the case of (1) a Shelf Registration Statement or (2)
Participating Broker-Dealers who have notified the Company and the Trust that
they will be utilizing the Prospectus contained in the Exchange Offer
Registration Statement as provided in Section 3(t) hereof, are seeking to sell
Exchange Securities and are required to deliver Prospectuses each Holder agrees
that, upon receipt of any notice from the Company or the Trust of the happening
of any event of the kind described in Section 3(e)(ii), 3(e)(iii), 3(e)(iv) or
3(e)(v) hereof, such Holder will forthwith discontinue disposition of
Registrable Securities pursuant to a Registration Statement until such Holder's
receipt of the copies of the supplemented or amended Prospectus contemplated by
Section 3(i) hereof or until it is advised in writing (the "Advice") by the
Company and the Trust that the use of the applicable Prospectus may be resumed,
and, if so directed by the Company and the Trust, such Holder will deliver to
the Company or the Trust all copies in such Holder's possession, other than
permanent file copies then in such Holder's posses sion, of the Prospectus
covering such Registrable Securities or Exchange Securities, as the case may be,
current at the time of receipt of such notice.
4. Indemnification and Contribution. (a) In connection with
any Registration Statement, the Company and the Trust shall, jointly and
severally, indemnify and hold harmless each Initial Purchaser who participates
in an offering of the Registrable Securities, each Person, if any, who controls
any of the Initial Purchasers within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act and each of their respective directors,
officers, employees and agents, as follows:
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<PAGE> 18
(i) from and against any and all loss, liability, claim,
damage and expense whatsoever arising out of any untrue statement or alleged
untrue statement of a material fact contained in any Registration Statement (or
any amendment thereto), covering Registrable Securities or Exchange Securities,
including all documents incorporated therein by reference, or the omission or
alleged omission therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading or arising out of any
untrue statement or alleged untrue statement of a material fact contained in any
Prospectus (or any amendment or supplement thereto) covering the Registrable
Securities or the Exchange Securities or the omission or alleged omission
therefrom of a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading;
(ii) from and against any and all loss, liability, claim,
damage and expense whatsoever, joint or several, as incurred, to the extent of
the aggregate amount paid in settlement of any litigation, or any investigation
or proceeding by any court or governmental agency or body, commenced or
threatened, or of any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, if such settlement
is effected with the prior written consent of the Company; and
(iii) from and against any and all expenses whatsoever, as
incurred (including reasonable fees and disbursements of counsel chosen by the
Initial Purchasers (except to the extent otherwise expressly provided in Section
4(b) hereof)), reasonably incurred in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any court or
governmental agency or body, commenced or threatened, or any claim whatsoever
based upon any such untrue statement or omission in any Prospectus (or any
amendment or supplement thereto) covering the Registrable Securities or the
Exchange Securities, or any such alleged untrue statement or omission, to the
extent that any such expense is not paid under subparagraph (i) or (ii) of this
Section 4(a);
provided, however, that (i) this indemnity does not apply to any loss,
liability, claim, damage or expense to the extent arising out of an untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company or
Trust by any Initial Purchaser, Holder, Participating Broker-Dealer or any
underwriter with respect to any Initial Purchaser, Holder, Participating
Broker-Dealer or any underwriter, as the case may be, expressly for use in the
Registration Statement (or any amendment thereto) or any Prospectus (or any
amendment or supplement thereto) and (ii) the Company and the Trust shall not be
liable to any Initial Purchaser, Holder, Participating Broker-Dealer, any
underwriter or controlling person, with respect to any untrue statement or
alleged untrue statement or omission or alleged omission in any preliminary
Prospectus to the extent that any such loss, liability, claim, damage or expense
of any Initial Purchaser, Holder, Participating Broker-Dealer, any underwriter
or controlling person results from the fact that any Initial Purchaser, Holder,
any underwriter or Participating Broker-Dealer sold Securities to a person to
whom there was not sent or given, at or prior to the written confirmation of
such sale, a copy of the final Prospectus as then amended or supplemented if the
Company had previously furnished copies thereof to such Initial Purchaser,
Holder, underwriter or Participating Broker-Dealer and the loss, liability,
claim, damage or expense of such Holder, underwriter, Participating
Broker-
-17-
<PAGE> 19
Dealer or controlling person results from an untrue statement or omission of a
material fact contained in the preliminary Prospectus which was corrected in the
final Prospectus or an amended Prospectus. Any amounts advanced by the Company
or the Trust to an indemnified party pursuant to this Section 4 as a result of
such losses shall be returned to the Company or the Trust if it shall be finally
determined by such a court in a judgment not subject to appeal or final review
that such indemnified party was not entitled to indemnification by the Company
or the Trust.
(b) Each of the Initial Purchasers and each Holder agrees,
severally and not jointly, to indemnify and hold harmless the Company, the
Trust, any underwriter and the other selling Holders and each of their
respective directors, officers (including each officer of the Company and the
Trust who signed the Registration Statement), employees and agents and each
Person, if any, who controls the Company, the Trust, any underwriter or any
other selling Holder within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act, from and against any and all loss, liability,
claim, damage and expense whatsoever described in the indemnity contained in
Section 4(a) hereof, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the Registration
Statement (or any amendment thereto) or any Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with written information
furnished to the Company or the Trust by such Initial Purchaser or selling
Holder with respect to such Initial Purchaser or Holder expressly for use in the
Registration Statement (or any amendment thereto), or any such Prospectus (or
any amendment or supplement thereto).
(c) Each indemnified party shall give prompt notice to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, enclosing a copy of all papers properly
served on such indemnified party, but failure to so notify an indemnifying party
shall not relieve such indemnifying party from any liability which it may have
under this Section 4, except to the extent that it is prejudiced by such
failure. An indemnifying party may participate at its own expense in the defense
of such action. If an indemnifying party so elects within a reasonable time
after receipt of such notice, an indemnifying party, severally or jointly with
any other indemnifying parties receiving such notice, may assume the defense of
such action with counsel chosen by it and reasonably acceptable to the
indemnified parties defendant in such action, provided, however, that if (i)
representation of such indemnified party by the same counsel would present a
conflict of interest or (ii) the actual or potential defendants in, or targets
of, any such action include both the indemnified party and the indemnifying
party and any such indemnified party reasonably determines that there may be
legal defenses available to such indemnified party which are different from or
in addition to those available to such indemnifying party, then in the case of
clauses (i) and (ii) of this Section 4(c) such indemnifying party and counsel
for each indemnifying party or parties shall not be entitled to assume such
defense. If an indemnifying party is not entitled to assume the defense of such
action as a result of the proviso to the preceding sentence, counsel for such
indemnifying party and counsel for each indemnified party or parties shall be
entitled to conduct the defense of such indemnified party or parties. If an
indemnifying party assumes the defense of such action, in accordance with and as
permitted by the provisions of this paragraph, such indemnifying parties shall
not be liable for any fees and
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<PAGE> 20
expenses of counsel for the indemnified parties incurred thereafter in
connection with such action. In no event shall the indemnifying parties be
liable for the fees and expenses of more than one counsel (in addition to local
counsel), separate from its own counsel, for all indemnified parties in
connection with any one action or separate but similar or related actions
arising out of the same general allegations or circumstances.
(d) In order to provide for just and equitable contribution in
circumstances under which any of the indemnity provisions set forth in this
Section 4 is for any reason held to be unavailable to the indemnified parties
although applicable in accordance with its terms, the Company, the Trust, and
the Holders shall contribute to the aggregate losses, liabilities, claims,
damages and expenses of the nature contemplated by such indemnity agreement
incurred by the Company, the Trust, the Initial Purchasers and the Holders, as
incurred; provided that no Person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution
from any Person that was not guilty of such fraudulent misrepresentation. As
between the Company, the Trust and the Holders, such parties shall contribute
to such aggregate losses, liabilities, claims, damages and expenses of the
nature contemplated by such indemnity agreement in such proportion as shall be
appropriate to reflect the relative fault of the Company and Trust, on the one
hand, and the Initial Purchasers and the Holders (and their underwriters and
representatives), on the other hand, with respect to the statements or
omissions which resulted in such loss, liability, claim, damage or expense, or
action in respect thereof, as well as any other relevant equitable
considerations. The relative fault of the Company and the Trust, on the one
hand, and of the Initial Purchasers and the Holders (and their underwriters and
representatives), on the other hand, shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company or the Trust, on the one hand, or by or on
behalf of the Holders, on the other, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company, the Trust, the Initial Purchasers and the
Holders of the Registrable Securities agree that it would not be just and
equitable if contribution pursuant to this Section 4 were to be determined by
pro rata allocation or by any other method of allocation that does not take into
account the relevant equitable considerations.
5. Participation in Underwritten Registrations. No Holder may
participate in any underwritten registration hereunder unless such Holder (a)
agrees to sell such Holder's Registrable Securities on the basis provided in any
underwriting arrangements approved by the Persons entitled hereunder to approve
such arrangements and (b) completes and executes all reasonable questionnaires,
powers of attorney, indemnities, underwriting agreements, lock-up letters and
other documents reasonably required under the terms of such underwriting
arrangements.
6. Selection of Underwriters. The Holders of Registrable
Securities covered by the Shelf Registration Statement who desire to do so may
sell the securities covered by such Shelf Registration in an underwritten
offering. In any such underwritten offering, the underwriter or underwriters and
manager or managers that will administer the offering will be selected by the
Holders of a majority in aggregate principal amount of the Registrable
Securities
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<PAGE> 21
included in such offering; provided, however, that such underwriters and
managers must be reasonably satisfactory to the Company and the Trust.
7. Miscellaneous.
(a) Rule 144 and Rule 144A. For so long as the Company or the
Trust is subject to the reporting requirements of Section 13 or 15 of the
Exchange Act and any Registrable Securities remain outstanding, the Company will
use its reasonable best efforts to file the reports required to be filed by it
under the Securities Act and Section 13(a) or 15(d) of the Exchange Act and the
rules and regulations adopted by the SEC thereunder, or, if it ceases to be so
required to file such reports, it will, upon the request of any Holder of
Registrable Securities (a) make publicly available such information as is
necessary to permit sales of securities of the Company and the Trust pursuant to
Rule 144 under the Securities Act, (b) deliver such information to a prospective
purchaser as is necessary to permit sales of securities of the Company and the
Trust pursuant to Rule 144A under the Securities Act, and (c) take such further
action that is reasonable in the circumstances, in each case, to the extent
reasonably required from time to time to enable such Holder to sell its
Registrable Securities without registration under the Securities Act within the
limitation of the exemptions provided by (i) Rule 144 under the Securities Act,
as such rule may be amended from time to time, (ii) Rule 144A under the
Securities Act, as such rule may be amended from time to time, or (iii) any
similar rules or regulations hereafter adopted by the SEC. Upon the request of
any Holder of Registrable Securities, the Company and the Trust will deliver to
such Holder a written statement as to whether they have complied with such
requirements.
(b) Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given unless agreed to in writing by the Company and the Trust and
unless the Company and the Trust has obtained the written consent of Holders of
at least a majority in aggregate principal amount of the outstanding Regis
trable Securities affected by such amendment, modification, supplement, waiver
or departure; provided no amendment, modification or supplement or waiver or
consent to the departure with respect to the provisions of Section 4 hereof
shall be effective as against any Initial Purchaser unless consented to in
writing by such Holder of Registrable Securities. Notwithstanding the foregoing
sentence, (i) this Agreement may be amended, without the consent of any Holder
of Registrable Securities, by written agreement signed by the Company, the Trust
and Merrill Lynch, to cure any ambiguity, correct or supplement any provision of
this Agreement that may be inconsistent with any other provision of this
Agreement or to make any other provisions with respect to matters or questions
arising under this Agreement which shall not be inconsistent with other
provisions of this Agreement, (ii) this Agreement may be amended, modified or
supplemented, and waivers and consents to departures from the provisions hereof
may be given, by written agreement signed by the Company, the Trust and Merrill
Lynch to the extent that any such amendment, modification, supplement, waiver or
consent is, in their reasonable judgment, necessary or appropriate to comply
with applicable law (including any interpretation of the Staff of the SEC) or
any change therein and (iii) to the extent any provision of this Agreement
relates to the Initial Purchasers, such provision may be amended, modified or
supplemented, and
-20-
<PAGE> 22
waivers or consents to departures from such provisions may be given, by written
agreement signed by Merrill Lynch, the Company and the Trust.
(c) Notices. All notices and other communications provided for
or permitted hereunder shall be made in writing by hand-delivery, registered
first-class mail, telex, telecopier, or any courier guaranteeing overnight
delivery (i) if to a Holder, at the most current address given by such Holder to
the Company or the Trust by means of a notice given in accordance with the
provisions of this Section 7(d), which address initially is, with respect to the
Initial Purchasers, the address set forth in the Purchase Agreement; and (ii) if
to the Company or the Trust, initially at the Company's address set forth in the
Purchase Agreement and thereafter at such other address, notice of which is
given in accordance with the provisions of this Section 7(d).
All such notices and communications shall be deemed to have
been duly given: at the time delivered by hand, if personally delivered; five
Business Days after being deposited in the mail, postage prepaid, if mailed;
when answered back, if telexed; when receipt is acknowledged, if telecopied; and
on the next Business Day, if timely delivered to an air courier guaranteeing
overnight delivery.
Copies of all such notices, demands, or other communications
shall be concurrently delivered by the Person giving the same to the Trustee, at
the address specified in the Indenture.
(d) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors, assigns and transferees of the
Initial Purchasers, including, without limitation and without the need for an
express assignment, subsequent Holders; provided, however, that nothing herein
shall be deemed to permit any assignment, transfer or other disposition of
Registrable Securities in violation of the terms of the Purchase Agreement or
the Indenture. If any transferee of any Holder shall acquire Registrable
Securities, in any manner, whether by operation of law or otherwise, such
Registrable Securities shall be held subject to all of the terms of this
Agreement, and by taking and holding such Registrable Securities, such Person
shall be conclusively deemed to have agreed to be bound by and to perform all of
the terms and provisions of this Agreement and such Person shall be entitled to
receive the benefits hereof.
(e) Third Party Beneficiary. Each of the Initial Purchasers
shall be a third party beneficiary of the agreements made hereunder between the
Company and the Trust, on the one hand, and the Holders, on the other hand, and
shall have the right to enforce such agreements directly to the extent it deems
such enforcement necessary or advisable to protect its rights or the rights of
Holders hereunder.
(f) Counterparts. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
-21-
<PAGE> 23
(g) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(h) GOVERNING LAW. THIS AGREEMENT SHALL BE DEEMED TO HAVE BEEN
MADE IN THE STATE OF NEW YORK. THE VALIDITY AND INTERPRETATION OF THIS
AGREEMENT, AND THE TERMS AND CONDITIONS SET FORTH HEREIN, SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT
GIVING EFFECT TO ANY PROVISIONS RELATING TO CONFLICTS OF LAWS. EACH OF THE
PARTIES HERETO AGREES TO SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE
OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT.
(i) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be affected or impaired thereby.
(j) Securities Held by the Company, the Trust or its
Affiliates. Whenever the consent or approval of Holders of a specified
percentage of Registrable Securities is required hereunder, Registrable
Securities held by the Company, the Trust or its affiliates (as such term is
defined in Rule 405 under the Securities Act) shall not be counted in
determining whether such consent or approval was given by the Holders of such
required percentage.
-22-
<PAGE> 24
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
AGL RESOURCES INC.
By:/s/ J. Michael Riley
-----------------------------------------
Name: J. Michael Riley
Title: Vice President and Chief
Financial Officer
AGL CAPITAL TRUST
By:/s/ J. Michael Riley
-----------------------------------------
Name: J. Michael Riley
Title: Administrative Trustee
-23-
<PAGE> 25
Confirmed and accepted as of
the date first above
written:
MERRILL LYNCH & CO.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
GOLDMAN, SACHS & CO.
SALOMON BROTHERS INC.
By: MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED,
as Representatives of the
Several Initial Purchasers
By:/s/ Robert Craig
-------------------------------------
Name: Robert Craig
Title: Vice President
-24-
<PAGE> 1
Long, Aldridge & Norman LLP
Suite 5300
303 Peachtree Street, N.E.
Atlanta, Georgia 30308
EXHIBIT 5.1
August 27, 1997
AGL Resources Inc.
AGL Capital Trust
303 Peachtree Street, N.E.
Atlanta, Georgia 30308
Re: AGL Resources Inc. and AGL Capital Trust
Registration Statement on Form S-4
Ladies and Gentlemen:
We have acted as counsel to AGL Resources Inc., a Georgia corporation
("AGL Resources"), and AGL Capital Trust, a statutory business trust formed
under the laws of the State of Delaware (the "Trust"), in connection with the
preparation of a Registration Statement on Form S-4 (the "Registration
Statement") and the filing thereof with the Securities and Exchange Commission
(the "Commission") by AGL Resources and the Trust. Pursuant to the Registration
Statement, AGL Resources and the Trust intend to register under the Securities
Act of 1933, as amended, (i) 75,000 of the Trust's Series B 8.17% Capital
Securities, Liquidation Amount $1,000 per Capital Security (the "Capital
Securities"), (ii) $75,000,000 aggregate principal amount of AGL Resources'
Series B 8.17% Junior Subordinated Deferrable Interest Debentures due June 1,
2037 (the "Debentures") and (iii) AGL Resources' guarantee of payment of cash
distributions and payments on liquidation of the Trust or redemption of the
Capital Securities (the "Guarantee"). AGL Resources proposes to issue the
Debentures in exchange (the "Exchange Offer") for a like principal amount of
currently outstanding Series A 8.17% Junior Subordinated Deferrable Interest
Debentures due June 1, 2037 (the "Original Debentures").
In rendering our Opinions, we have examined such agreements, documents,
instruments and records as we deemed necessary or appropriate under the
circumstances for us to express our Opinions hereinafter set forth, including:
(i) the Articles of Incorporation and Bylaws of AGL Resources, in each case as
amended through the date hereof; (ii) the Registration Statement; (iii) the
Indenture, dated as of June 11, 1997, by and between AGL Resources and The Bank
of New York, as Trustee (the "Indenture"); (iv) the Registration Rights
Agreement, dated as of June 11, 1997 (the "Registration Rights Agreement"),
among AGL Resources, the Trust and Merrill Lynch & Co., Merrill Lynch, Pierce,
Fenner & Smith Incorporated, Goldman, Sachs & Co. and Salomon Brothers Inc; (v)
the Amended and Restated Declaration of Trust of the Trust, dated as of June 11,
1997 (the "Declaration"), among the administrative trustees named therein, The
Bank of New York, as
<PAGE> 2
AGL Resources Inc.
August 27, 1997
Page 2
property trustee, The Bank of New York (Delaware), as Delaware trustee, and AGL
Resources, as sponsor; (vi) the form of the Debentures; and (vii) the form of
Series B Capital Securities Guarantee Agreement (the "Guarantee Agreement")
between AGL Resources and The Bank of New York, as trustee. In making all of our
examinations, we assumed the legal capacity of all natural persons, the
genuineness of all signatures, the authenticity of all documents submitted to us
as originals, the conformity to the original documents of all documents
submitted to us as copies and the authenticity of the originals of such latter
documents, and the due execution and delivery of all documents by any persons or
entities where due execution and delivery by such persons or entities is a
prerequisite to the effectiveness of such documents.
As to various factual matters that are material to our Opinions, we
have relied upon the factual statements set forth in a certificate of officers
of AGL Resources and certificates of various public officials. We have not
independently verified or investigated, nor do we assume any responsibility for,
the factual accuracy or completeness of such factual statements.
Members of this firm are admitted to the Bar of the State of Georgia
and are duly qualified to practice law in that state. We do not herein express
any opinion concerning any matter respecting or affected by any laws other than
the laws of the State of Georgia that are now in effect and that, in the
exercise of reasonable professional judgment, are normally considered in
transactions such as those contemplated by the issuance of the Exchange
Debentures. We have relied upon the opinion of Winthrop, Stimson, Putnam &
Roberts dated the date hereof and addressed to us as to all matters of New York
law related to the Opinions. The Opinions hereinafter set forth are based upon
pertinent laws and facts in existence as of the date hereof, and we expressly
disclaim any obligation to advise you of changes to such pertinent laws or facts
that hereafter may come to our attention.
The only opinions rendered by this firm are in numbered paragraphs (1)
and (2) below (our "Opinions"), and no other opinion is implied or to be
inferred. Additionally, our Opinions are based upon and subject to the
qualifications, limitations and exceptions set forth in this letter.
Based upon and subject to the foregoing, we are of the Opinion that:
(1) The Debentures, when authenticated, issued and delivered in
exchange for the Original Debentures as set forth in the
Registration Statement and in accordance with the provisions
of the Indenture, will be legally issued, fully paid and
nonassessable and will be binding obligations of AGL
Resources, except as may be limited by (a) bankruptcy,
reorganization, insolvency, moratorium, fraudulent conveyance,
or other similar laws or judicial decisions now or hereafter
in effect relating to or affecting creditors rights
<PAGE> 3
AGL Resources Inc.
August 27, 1997
Page 3
generally, (b) general principles of equity (regardless of
whether considered in a proceeding at law or in equity), and
(c) an implied covenant of good faith and fair dealing.
(2) The Guarantee Agreement has been duly authorized by AGL
Resources, and when (i) the Declaration and Indenture have
been qualified under the Trust Indenture Act of 1939, as
amended, and (ii) the Guarantee Agreement is duly executed
and delivered by AGL Resources and The Bank of New York, as
trustee, and issued in the Exchange Offer as contemplated by
the Registration Rights Agreement and the Registration
Statement, the Guarantee Agreement will constitute a valid,
and binding obligation of AGL Resources, except as may be
limited by (a) bankruptcy, reorganization, insolvency,
moratorium, fraudulent conveyance or other similar laws or
judicial decisions now or hereafter in effect relating to or
affecting creditors' rights generally, (b) general principles
of equity (regardless of whether considered in a proceeding
at law or in equity), and (c) an implied covenant of good
faith and fair dealing.
We hereby consent to the filing of this letter as an exhibit to the
Registration Statement and to the reference to our firm under the heading "Legal
Matters" set forth in the Prospectus forming a part of the Registration
Statement.
Very truly yours,
/s/ LONG ALDRIDGE & NORMAN LLP
<PAGE> 1
Exhibit 5.2
[Richards, Layton & Finger Letterhead]
August 26, 1997
AGL Capital Trust
c/o AGL Resources Inc.
303 Peachtree Street, N.E.
Atlanta, Georgia 30308
Re: AGL Capital Trust
Ladies and Gentlemen:
We have acted as special Delaware counsel for AGL Resources
Inc., a Georgia corporation (the "Company"), and AGL Capital Trust, a Delaware
statutory business trust (the "Trust"), in connection with the matters set
forth herein. At your request, this opinion is being furnished to you.
For purposes of giving the opinions hereinafter set forth,
our examination of documents has been limited to the examination of originals
or copies of the following:
(a) The Certificate of Trust of the Trust, dated as of June
6, 1997 (the "Certificate"), as filed in the office of the Secretary of State
of the State of Delaware (the "Secretary of State") on June 6, 1997;
(b) The Declaration of Trust of the Trust, dated as of June
6, 1997, between the Company and the trustee of the Trust named therein, as
amended and restated by the Amended and Restated Declaration of Trust of the
Trust, dated as of June 11, 1997 (including Annex I and Exhibits A-1 and A-2),
among the Company, the trustees of the Trust named therein, and the holders
from time to time of the undivided beneficial interests in the assets of the
Trust (the "Trust Agreement");
<PAGE> 2
AGL Capital Trust
August 26, 1997
Page 2
(c) The Registration Statement (the "Registration Statement")
on Form S-4, including a preliminary prospectus with respect to the Trust (the
"Prospectus"), relating to the Series B 8.17% Capital Securities of the Trust
representing preferred undivided beneficial interests in the assets of the
Trust (each, a "Capital Security" and collectively, the "Capital Securities"),
filed by the Company and the Trust with the Securities and Exchange Commission
on or about August 27, 1997; and
(d) A Certificate of Good Standing for the Trust, dated
August 26, 1997, obtained from the Secretary of State.
Capitalized terms used herein and not otherwise defined are
used as defined in the Trust Agreement.
For purposes of this opinion, we have not reviewed any
documents other than the documents listed in paragraphs (a) through (d) above.
In particular, we have not reviewed any document (other than the documents
listed in paragraphs (a) through (d) above) that is referred to in or
incorporated by reference into the documents reviewed by us. We have assumed
that there exists no provision in any document that we have not reviewed that
is inconsistent with the opinions stated herein. We have conducted no
independent factual investigation of our own but rather have relied solely upon
the foregoing documents, the statements and information set forth therein and
the additional matters recited or assumed herein, all of which we have assumed
to be true, complete and accurate in all material respects.
With respect to all documents examined by us, we have assumed
(i) the authenticity of all documents submitted to us as authentic originals,
(ii) the conformity with the originals of all documents submitted to us as
copies or forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the
Trust Agreement constitutes the entire agreement among the parties thereto with
respect to the subject matter thereof, including with respect to the creation,
operation and termination of the Trust, and that the Trust Agreement and the
Certificate are in full force and effect and have not been amended, (ii) except
to the extent provided in paragraph 1 below, the due creation, due formation or
due organization, as the case may be, and valid existence in good standing of
each party to the documents examined by us under the laws of the jurisdiction
governing its creation, formation or organization, (iii) the legal capacity of
natural persons who are parties to the documents examined by us, (iv) that each
of the parties to the documents examined by us has the power and authority to
execute and deliver, and to perform its obligations under, such documents, (v)
that each of the parties to the documents examined by us has duly authorized,
executed and delivered the documents examined by us, (vi) the receipt by each
person to whom a Capital Security is to be issued by the Trust (collectively,
the "Capital Security Holders") of a certificate evidencing
<PAGE> 3
AGL Capital Trust
August 26, 1997
Page 3
the Capital Security (a "Capital Security Certificate") and the payment for the
Capital Security acquired by it, in accordance with the Trust Agreement and as
described in the Registration Statement, and (vii) that the Capital Securities
are issued and sold to the Capital Security Holders in accordance with the
Trust Agreement and as described in the Registration Statement. We have not
participated in the preparation of the Registration Statement and assume no
responsibility for its contents.
This opinion is limited to the laws of the State of Delaware
(excluding the securities laws of the State of Delaware), and we have not
considered and express no opinion on the laws of any other jurisdiction,
including federal laws and rules and regulations relating thereto. Our opinions
are rendered only with respect to Delaware laws and rules, regulations and
orders thereunder that are currently in effect.
Based upon the foregoing, and upon our examination of such
questions of law and statutes of the State of Delaware as we have considered
necessary or appropriate, and subject to the assumptions, qualifications,
limitations and exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing
in good standing as a business trust under the Delaware Business Trust Act, 12
Del. C. ss.3801, et seq.
2. The Capital Securities to be issued to the Capital
Security Holders have been duly authorized by the Trust Agreement and will be
duly and validly issued and, subject to the qualifications set forth in
paragraph 3 below, fully paid and nonassessable undivided beneficial interests
in the assets of the Trust.
3. The Capital Security Holders, as beneficial owners of the
Trust, will be entitled to the same limitation of personal liability extended
to stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware. We note that the Capital Security
Holders may be obligated to make payments as set forth in the Trust Agreement.
We consent to the filing of this opinion with the Securities
and Exchange Commission as an exhibit to the Registration Statement. We hereby
consent to the use of our name under the heading "Validity of Securities" in
the Prospectus. In giving the foregoing consents, we do not thereby admit that
we come within the category of persons whose consent is required under Section
7 of the Securities Act of 1933, as amended, or the rules and regulations of
the Securities and Exchange Commission thereunder. Except as stated above,
without our
<PAGE> 4
AGL Capital Trust
August 26, 1997
Page 4
prior written consent, this opinion may not be furnished or quoted to, or
relied upon by, any other person for any purpose.
Very truly yours,
/s/ Richards, Layton & Finger
CDK
<PAGE> 1
EXHIBIT 8
[LONG, ALDRIDGE & NORMAN LLP LETTERHEAD]
August 27, 1997
AGL Resources Inc.
303 Peachtree Street, N.E.
Atlanta, GA 30308
Gentlemen:
We have acted as tax counsel for AGL Resources Inc., a Georgia
corporation (the "Company"), and AGL Capital Trust, a Delaware statutory
business trust (the "Trust"), in connection with the preparation and filing
under the Securities Act of 1933, as amended (the "Securities Act"), of the
Registration Statement on Form S-4 (the "Registration Statement") relating to
the proposed offer to exchange up to 75,000 of the Trust's Series B 8.17%
Capital Securities, $1,000 liquidation amount per capital security (the
"Exchange Capital Securities"), for a like number of its outstanding Series A
8.17% Capital Securities, $1,000 liquidation amount per capital security (the
"Original Capital Securities"). The Exchange Capital Securities will be
guaranteed (the "Exchange Guarantee") by the Company with respect to the
payment of distributions and payments upon liquidation, redemption and otherwise
to the extent set forth in the Prospectus (the "Prospectus") filed as part of
the Registration Statement.
In connection with the offer to exchange the Exchange Capital
Securities for the Original Capital Securities, the Company will also
offer to exchange $75,000,000 aggregate principal amount of its Series B 8.17%
Junior Subordinated Deferrable Interest Debentures due June 1, 2037 (the
"Exchange Junior Subordinated Debentures") for a like aggregate principal
amount of its outstanding Series A 8.17% Junior Subordinated Deferrable
Interest Debentures due June 1, 2037 (the "Original Junior Subordinated
Debentures"), which were purchased by the Trust with the proceeds of the
issuance of the Original Capital Securities. Like the Exchange Capital
Securities, the Exchange Junior Subordinated Debentures and the Exchange
Guarantee will be registered under the Securities Act.
Capitalized Terms used but not defined herein have the definitions
assigned them in the Prospectus.
It is our opinion that if the offer and sale of the Exchange Capital
Securities are conducted in the manner described in the Prospectus and if the
terms of the Exchange Capital Securities are as contemplated by the Prospectus
then the statements under the caption "Certain Federal Income Tax Consequences"
in the Prospectus correctly describe, in all material respects, certain United
States Federal income tax consequences resulting from the purchase, ownership
and disposition of the Exchange Capital Securities by an initial holder
thereof subject to United States income taxation, based upon current laws.
Except as set forth above, we express no opinion to any party as to the
tax consequences, whether federal, state, local or foreign, of the issuance of
the Exchange Capital Securities or of any transactions related to or
contemplated by such issuance. This opinion is solely for your benefit. This
opinion is expressed as of the date hereof unless otherwise expressly stated and
we disclaim any undertaking to advise you of any subsequent changes of the
facts stated or assumed herein or any subsequent changes in applicable law.
We hereby consent to the filing of this letter as an exhibit to the
Registration Statement and to the reference to our firm under the headings
"Certain Federal Income Tax Consequences" and "Legal Matters" set forth in the
Prospectus forming a part of the Registration Statement.
Very truly yours,
/s/ LONG ALDRIDGE & NORMAN LLP
<PAGE> 1
EXHIBIT 12
AGL RESOURCES INC. AND SUBSIDIARIES
STATEMENT SETTING FORTH COMPUTATION OF
RATIO OF EARNINGS TO FIXED CHARGES
For the Twelve Months Ended June 30, 1997 and the
Five Years Ended September 30, 1996
(Dollars in millions)
<TABLE>
<CAPTION>
Twelve Months
Ended June 30, Years Ended September 30,
-------------- -----------------------------------------------------------------------
1997 1996 1995 1994 1993 1992
-------------- -----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Earnings available for Fixed Charges:
Net income $ 77.9 $ 75.6 $ 26.4 $ 58.7 $ 53.2 $ 54.4
Income tax expense 48.6 47.5 16.7 36.3 30.5 25.8
Fixed charges - see below 62.7 59.2 57.4 57.4 56.1 52.1
-------------- -----------------------------------------------------------------------
Total $189.2 $182.3 $100.5 $152.4 $139.8 $132.3
============== =======================================================================
Fixed Charges:
Interest on long-term debt $ 43.4 $ 42.2 $ 42.7 $ 43.2 $ 43.5 $ 41.2
Other interest 9.0 7.3 5.1 4.6 3.7 7.7
Amortization of debt discount and
deferred financing costs 0.3 0.3 0.3 0.4 0.5 0.6
Interest component of rentals
charged to income 2.2 2.2 2.1 1.9 1.6 1.1
Dividends on preferred stock of
majority-owned subsidiaries 7.8 7.2 7.2 7.3 6.8 1.5
-------------- -----------------------------------------------------------------------
Total $ 62.7 $ 59.2 $ 57.4 $ 57.4 $ 56.1 $ 52.1
============== =======================================================================
Ratio of Earnings to Fixed Charges 3.02 3.08 1.75 2.66 2.49 2.54
============== =======================================================================
</TABLE>
<PAGE> 1
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration
Statement of AGL Resources Inc. on Form S-4 of our reports dated November 5,
1996, appearing in and incorporated by reference in the Annual Report on Form
10-K of AGL Resources Inc. for the year ended September 30, 1996 and to the
reference to us under the heading "Experts" in the Prospectus, which is part of
this Registration Statement.
/s/DELOITTE & TOUCHE LLP
Atlanta, Georgia
August 27, 1997
<PAGE> 1
EXHIBIT 25.1
CONFORMED COPY
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
----------------------
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
----------------------
AGL RESOURCES INC.
(Exact name of obligor as specified in its charter)
Georgia 58-2210952
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
303 Peachtree Street, N.E.
Atlanta, Georgia 30308
(Address of principal executive offices) (Zip code)
----------------------
Series B 8.17% Junior Subordinated
Deferrable Interest Debentures
(Title of the indenture securities)
================================================================================
<PAGE> 2
1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO THE
TRUSTEE:
(a) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO
WHICH IT IS SUBJECT.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------
Name Address
- ------------------------------------------------------------------------------------
<S> <C>
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y.
12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
</TABLE>
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION,
ARE INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO
RULE 7a-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17
C.F.R. 229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which
contains the authority to commence business and a grant of
powers to exercise corporate trust powers. (Exhibit 1 to
Amendment No. 1 to Form T-1 filed with Registration Statement
No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with
Registration Statement No. 33-21672 and Exhibit 1 to Form T-1
filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to
Form T-1 filed with Registration Statement No. 33-31019.)
-2-
<PAGE> 3
6. The consent of the Trustee required by Section 321(b) of the
Act. (Exhibit 6 to Form T-1 filed with Registration Statement
No. 33-44051.)
7. A copy of the latest report of condition of the Trustee
published pursuant to law or to the requirements of its
supervising or examining authority.
-3-
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its behalf
by the undersigned, thereunto duly authorized, all in The City of New York, and
State of New York, on the 25th day of August, 1997.
THE BANK OF NEW YORK
By: /S/THOMAS E. TABOR
--------------------------------
Name: THOMAS E. TABOR
Title: ASSISTANT TREASURER
-4-
<PAGE> 5
EXHIBIT 7
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries, a member of the Federal Reserve
System, at the close of business March 31, 1997, published in accordance with a
call made by the Federal Reserve Bank of this District pursuant to the
provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
ASSETS in Thousands
<S> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin ........................... $ 8,249,820
Interest-bearing balances .................................................... 1,031,026
Securities:
Held-to-maturity securities .................................................. 1,118,463
Available-for-sale securities ................................................ 3,005,838
Federal funds sold and Securities purchased under agreements to resell ......... 3,100,281
Loans and lease financing receivables:
Loans and leases, net of unearned income ..................................... 32,895,077
LESS: Allowance for loan and lease losses .................................... 633,877
LESS: Allocated transfer risk reserve ........................................ 429
Loans and leases, net of unearned income, allowance, and reserve ........... 32,260,771
Assets held in trading accounts ................................................ 1,715,214
Premises and fixed assets (including capitalized leases) ....................... 684,704
Other real estate owned ........................................................ 21,738
Investments in unconsolidated subsidiaries and associated companies ............ 195,761
Customers' liability to this bank on acceptances outstanding ................... 1,152,899
Intangible assets .............................................................. 683,503
Other assets ................................................................... 1,526,113
-----------
Total assets ................................................................... $54,746,131
===========
LIABILITIES
Deposits:
In domestic offices .......................................................... $25,614,961
Noninterest-bearing .......................................................... 10,564,652
Interest-bearing ............................................................. 15,050,309
In foreign offices, Edge and Agreement subsidiaries, and IBFs ................ 15,103,615
Noninterest-bearing .......................................................... 560,944
Interest-bearing ............................................................. 14,542,671
Federal funds purchased and Securities sold under agreements to repurchase ..... 2,093,286
Demand notes issued to the U.S. Treasury ....................................... 239,354
Trading liabilities ............................................................ 1,399,064
Other borrowed money:
With remaining maturity of one year or less .................................. 2,075,092
With remaining maturity of more than one year ................................ 20,679
Bank's liability on acceptances executed and outstanding ....................... 1,160,012
Subordinated notes and debentures .............................................. 1,014,400
Other liabilities .............................................................. 1,840,245
-----------
Total liabilities .............................................................. 50,560,708
-----------
EQUITY CAPITAL
Common stock ................................................................... 942,284
Surplus ........................................................................ 731,319
Undivided profits and capital reserves ......................................... 2,544,303
Net unrealized holding gains (losses) on available-for-sale securities ......... (19,449)
Cumulative foreign currency translation adjustments ............................ (13,034)
-----------
Total equity capital ........................................................... 4,185,423
-----------
Total liabilities and equity capital ........................................... $54,746,131
===========
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report
of Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Alan R. Griffith )
J. Carter Bacot ) Directors
Thomas A. Renyi )
<PAGE> 1
EXHIBIT 25.2
CONFORMED COPY
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
----------------------
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
----------------------
AGL CAPITAL TRUST
(Exact name of obligor as specified in its charter)
Delaware Applied For
(State or other jurisdiction of (I.R.S.
employer incorporation or organization) identification no.)
303 Peachtree Street, N.E.
Atlanta, Georgia 30308
(Address of principal executive offices) (Zip code)
----------------------
Series B 8.17% Capital Securities
(Title of the indenture securities)
================================================================================
<PAGE> 2
1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO THE
TRUSTEE:
(a) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO
WHICH IT IS SUBJECT.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------
Name Address
- ------------------------------------------------------------------------------------
<S> <C>
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y.
12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
</TABLE>
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION,
ARE INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO
RULE 7a-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17
C.F.R. 229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which
contains the authority to commence business and a grant of
powers to exercise corporate trust powers. (Exhibit 1 to
Amendment No. 1 to Form T-1 filed with Registration Statement
No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with
Registration Statement No. 33-21672 and Exhibit 1 to Form T-1
filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to
Form T-1 filed with Registration Statement No. 33-31019.)
-2-
<PAGE> 3
6. The consent of the Trustee required by Section 321(b) of the
Act. (Exhibit 6 to Form T-1 filed with Registration Statement
No. 33-44051.)
7. A copy of the latest report of condition of the Trustee
published pursuant to law or to the requirements of its
supervising or examining authority.
-3-
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its behalf
by the undersigned, thereunto duly authorized, all in The City of New York, and
State of New York, on the 25th day of August, 1997.
THE BANK OF NEW YORK
By: /S/THOMAS E. TABOR
-------------------------------
Name: THOMAS E. TABOR
Title: ASSISTANT TREASURER
-4-
<PAGE> 5
EXHIBIT 7
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries, a member of the Federal Reserve
System, at the close of business March 31, 1997, published in accordance with a
call made by the Federal Reserve Bank of this District pursuant to the
provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
ASSETS in Thousands
<S> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin ........................... $ 8,249,820
Interest-bearing balances .................................................... 1,031,026
Securities:
Held-to-maturity securities .................................................. 1,118,463
Available-for-sale securities ................................................ 3,005,838
Federal funds sold and Securities purchased under agreements to resell ......... 3,100,281
Loans and lease financing receivables:
Loans and leases, net of unearned income ..................................... 32,895,077
LESS: Allowance for loan and lease losses .................................... 633,877
LESS: Allocated transfer risk reserve ........................................ 429
Loans and leases, net of unearned income, allowance, and reserve ........... 32,260,771
Assets held in trading accounts ................................................ 1,715,214
Premises and fixed assets (including capitalized leases) ....................... 684,704
Other real estate owned ........................................................ 21,738
Investments in unconsolidated subsidiaries and associated companies ............ 195,761
Customers' liability to this bank on acceptances outstanding ................... 1,152,899
Intangible assets .............................................................. 683,503
Other assets ................................................................... 1,526,113
-----------
Total assets ................................................................... $54,746,131
===========
LIABILITIES
Deposits:
In domestic offices .......................................................... $25,614,961
Noninterest-bearing .......................................................... 10,564,652
Interest-bearing ............................................................. 15,050,309
In foreign offices, Edge and Agreement subsidiaries, and IBFs ................ 15,103,615
Noninterest-bearing .......................................................... 560,944
Interest-bearing ............................................................. 14,542,671
Federal funds purchased and Securities sold under agreements to repurchase ..... 2,093,286
Demand notes issued to the U.S. Treasury ....................................... 239,354
Trading liabilities ............................................................ 1,399,064
Other borrowed money:
With remaining maturity of one year or less .................................. 2,075,092
With remaining maturity of more than one year ................................ 20,679
Bank's liability on acceptances executed and outstanding ....................... 1,160,012
Subordinated notes and debentures .............................................. 1,014,400
Other liabilities .............................................................. 1,840,245
-----------
Total liabilities .............................................................. 50,560,708
-----------
EQUITY CAPITAL
Common stock ................................................................... 942,284
Surplus ........................................................................ 731,319
Undivided profits and capital reserves ......................................... 2,544,303
Net unrealized holding gains (losses) on available-for-sale securities ......... (19,449)
Cumulative foreign currency translation adjustments ............................ (13,034)
-----------
Total equity capital ........................................................... 4,185,423
-----------
Total liabilities and equity capital ........................................... $54,746,131
===========
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report
of Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Alan R. Griffith )
J. Carter Bacot ) Directors
Thomas A. Renyi )
<PAGE> 1
EXHIBIT 25.3
CONFORMED COPY
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
----------------------
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
----------------------
AGL RESOURCES INC.
(Exact name of obligor as specified in its charter)
Georgia 58-2210952
(State or other jurisdiction of (I.R.S.
employer incorporation or organization) identification no.)
303 Peachtree Street, N.E.
Atlanta, Georgia 30308
(Address of principal executive offices) (Zip code)
----------------------
Guarantee of Series B 8.17% Capital Securities of
AGL Capital Trust
(Title of the indenture securities)
================================================================================
<PAGE> 2
1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO THE
TRUSTEE:
(a) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO
WHICH IT IS SUBJECT.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------
Name Address
- ------------------------------------------------------------------------------------
<S> <C>
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y.
12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
</TABLE>
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION,
ARE INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO
RULE 7a-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17
C.F.R. 229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which
contains the authority to commence business and a grant of
powers to exercise corporate trust powers. (Exhibit 1 to
Amendment No. 1 to Form T-1 filed with Registration Statement
No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with
Registration Statement No. 33-21672 and Exhibit 1 to Form T-1
filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to
Form T-1 filed with Registration Statement No. 33-31019.)
-2-
<PAGE> 3
6. The consent of the Trustee required by Section 321(b) of the
Act. (Exhibit 6 to Form T-1 filed with Registration Statement
No. 33-44051.)
7. A copy of the latest report of condition of the Trustee
published pursuant to law or to the requirements of its
supervising or examining authority.
-3-
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its behalf
by the undersigned, thereunto duly authorized, all in The City of New York, and
State of New York, on the 25th day of August, 1997.
THE BANK OF NEW YORK
By: /S/THOMAS E. TABOR
-------------------------------
Name: THOMAS E. TABOR
Title: ASSISTANT TREASURER
-4-
<PAGE> 5
EXHIBIT 7
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries, a member of the Federal Reserve
System, at the close of business March 31, 1997, published in accordance with a
call made by the Federal Reserve Bank of this District pursuant to the
provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
ASSETS in Thousands
<S> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin ........................... $ 8,249,820
Interest-bearing balances .................................................... 1,031,026
Securities:
Held-to-maturity securities .................................................. 1,118,463
Available-for-sale securities ................................................ 3,005,838
Federal funds sold and Securities purchased under agreements to resell ......... 3,100,281
Loans and lease financing receivables:
Loans and leases, net of unearned income ..................................... 32,895,077
LESS: Allowance for loan and lease losses .................................... 633,877
LESS: Allocated transfer risk reserve ........................................ 429
Loans and leases, net of unearned income, allowance, and reserve ........... 32,260,771
Assets held in trading accounts ................................................ 1,715,214
Premises and fixed assets (including capitalized leases) ....................... 684,704
Other real estate owned ........................................................ 21,738
Investments in unconsolidated subsidiaries and associated companies ............ 195,761
Customers' liability to this bank on acceptances outstanding ................... 1,152,899
Intangible assets .............................................................. 683,503
Other assets ................................................................... 1,526,113
-----------
Total assets ................................................................... $54,746,131
===========
LIABILITIES
Deposits:
In domestic offices .......................................................... $25,614,961
Noninterest-bearing .......................................................... 10,564,652
Interest-bearing ............................................................. 15,050,309
In foreign offices, Edge and Agreement subsidiaries, and IBFs ................ 15,103,615
Noninterest-bearing .......................................................... 560,944
Interest-bearing ............................................................. 14,542,671
Federal funds purchased and Securities sold under agreements to repurchase ..... 2,093,286
Demand notes issued to the U.S. Treasury ....................................... 239,354
Trading liabilities ............................................................ 1,399,064
Other borrowed money:
With remaining maturity of one year or less .................................. 2,075,092
With remaining maturity of more than one year ................................ 20,679
Bank's liability on acceptances executed and outstanding ....................... 1,160,012
Subordinated notes and debentures .............................................. 1,014,400
Other liabilities .............................................................. 1,840,245
-----------
Total liabilities .............................................................. 50,560,708
-----------
EQUITY CAPITAL
Common stock ................................................................... 942,284
Surplus ........................................................................ 731,319
Undivided profits and capital reserves ......................................... 2,544,303
Net unrealized holding gains (losses) on available-for-sale securities ......... (19,449)
Cumulative foreign currency translation adjustments ............................ (13,034)
-----------
Total equity capital ........................................................... 4,185,423
-----------
Total liabilities and equity capital ........................................... $54,746,131
===========
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report
of Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Alan R. Griffith )
J. Carter Bacot ) Directors
Thomas A. Renyi )
<PAGE> 1
Exhibit 99.1
LETTER OF TRANSMITTAL
AGL CAPITAL TRUST
OFFER TO EXCHANGE ITS
SERIES B 8.17% CAPITAL SECURITIES
(LIQUIDATION AMOUNT $1,000 PER EXCHANGE CAPITAL
SECURITY) WHICH HAVE BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933
FOR ANY AND ALL OF ITS OUTSTANDING
SERIES A 8.17% CAPITAL SECURITIES
(LIQUIDATION AMOUNT $1,000 PER ORIGINAL CAPITAL SECURITY)
FULLY AND UNCONDITIONALLY GUARANTEED, AS DESCRIBED HEREIN, BY
AGL RESOURCES INC.
PURSUANT TO THE PROSPECTUS DATED _________________, 1997
- -------------------------------------------------------------------------------
THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK
CITY TIME, ON _______________, 1997 OR SUCH LATER DATE AND TIME TO WHICH THE
EXCHANGE OFFER MAY BE EXTENDED (THE "EXPIRATION DATE"). TENDERS MAY BE
WITHDRAWN PRIOR TO THE EXPIRATION DATE.
- -------------------------------------------------------------------------------
The Exchange Agent For The Exchange Offer Is:
<TABLE>
<CAPTION>
THE BANK OF NEW YORK
<S> <C> <C>
By Mail: By Facsimile: By Hand or Overnight
(Registered or Certified (Eligible Institutions Only) Delivery:
Mail recommended)
(212) 815-6339 The Bank of New York
The Bank of New York 101 Barclay Street
101 Barclay Street - 7 East To Confirm by Telephone Corporate Trust Services Window,
New York, New York 10286 or for Information Call: Ground Level
Attention: Enrique Lopez New York, New York 10286
Reorganization Section (212) 815-2742 Attention: Enrique Lopez - 7 East
Reorganization Section
</TABLE>
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET
FORTH ABOVE OR TRANSMISSION OF THIS LETTER OF TRANSMITTAL VIA FACSIMILE TO A
NUMBER OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE A VALID DELIVERY.
THE INSTRUCTIONS CONTAINED HEREIN SHOULD BE READ CAREFULLY BEFORE THIS
LETTER OF TRANSMITTAL IS COMPLETED.
Capitalized terms used but not defined herein shall have the same
meaning given them in the Prospectus (as defined below).
<PAGE> 2
The Letter of Transmittal is to be completed by holders (which term,
for purposes of this document, shall include any participant in The Depository
Trust Company ("DTC") either if (a) certificates are to be forwarded herewith
or (b) tenders are to be made pursuant to the procedures for tender by
book-entry transfer set forth under "The Exchange Offer--Procedures for
Tendering Original Capital Securities" in the Prospectus and an Agent's Message
(as defined below) is not delivered. Certificates, or book-entry confirmation
of a book-entry transfer of such Original Capital Securities into the Exchange
Agent's account at DTC, as well as this Letter of Transmittal (or facsimile
thereof or delivery of an Agent's Message in lieu thereof), properly completed
and duly executed, with any required signature guarantees, and any other
documents required by this Letter of Transmittal, must be received by the
Exchange Agent at its address set forth herein on or prior to the Expiration
Date. Tenders by book-entry transfer may also be made by delivering an Agent's
Message in lieu of this Letter of Transmittal. The term "book-entry
confirmation" means a confirmation of a book-entry transfer of Original Capital
Securities into the Exchange Agent's account at DTC. The term "Agent's Message"
means a message transmitted by DTC to and received by the Exchange Agent and
forming part of a book-entry confirmation, which states that DTC has received
an express acknowledgment from the tendering participant, which acknowledgment
states that such participant has received and agrees to be bound by this Letter
of Transmittal and that the Trust and AGL Resources Inc. ("AGL Resources") may
enforce this Letter of Transmittal against such participant.
Holders of Original Capital Securities whose certificates (the
"Certificates") for such Original Capital Securities are not immediately
available or who cannot deliver their Certificates and all other required
documents to the Exchange Agent on or prior to the Expiration Date (as defined
in the Prospectus) or who cannot complete the procedures for book-entry
transfer on a timely basis, must tender their Original Capital Securities
according to the guaranteed delivery procedures set forth in "The Exchange
Offer--Procedures for Tendering Original Capital Securities" in the Prospectus.
DELIVERY OF DOCUMENTS TO THE BOOK-ENTRY TRANSFER FACILITY DOES NOT
CONSTITUTE DELIVERY TO THE EXCHANGE AGENT.
NOTE: SIGNATURES MUST BE PROVIDED BELOW
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
ALL TENDERING HOLDERS COMPLETE THIS BOX:
<TABLE>
<CAPTION>
DESCRIPTION OF ORIGINAL CAPITAL SECURITIES TENDERED
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
IF BLANK, PLEASE PRINT CERTIFICATE AGGREGATE PRINCIPAL AMOUNT PRINCIPAL AMOUNT OF
NAME AND ADDRESS OF NUMBER(S)** OF ORIGINAL CAPITAL SECURITIES ORIGINAL CAPITAL
REGISTERED HOLDER (AS SECURITIES TENDERED (IF
IT APPEARS ON LESS THAN ALL)***
CERTIFICATES, IF
APPLICABLE).*
- ------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
TOTAL AMOUNT TENDERED
-------------------------------------------------------------------------------------
</TABLE>
* Please list each Certificate separately. Attach additional list if
necessary. See Instruction 3.
** Need not be completed by book-entry holders.
*** Original Capital Securities may be tendered in whole or in part in
denominations of $100,000 and integral multiples of $1,000 in excess
thereof, provided that if any Original Capital Securities are tendered
for exchange in part, the untendered principal amount thereof must be
$100,000 or any integral multiple of $1,000 in excess thereof. All
Original Capital Securities held shall be deemed tendered unless a
lesser number is specified in this column. See Instruction 4.
2
<PAGE> 3
(BOXES BELOW TO BE CHECKED BY ELIGIBLE INSTITUTIONS ONLY)
[ ] CHECK HERE IF TENDERED ORIGINAL CAPITAL SECURITIES ARE BEING DELIVERED BY
BOOK-ENTRY TRANSFER MADE TO THE ACCOUNT MAINTAINED BY THE EXCHANGE
AGENT WITH DTC AND COMPLETE THE FOLLOWING:
Name of Tendering Institution:_________________________________________________
DTC Account Number:____________________________________________________________
Transaction Code Number:_______________________________________________________
[ ] CHECK HERE AND ENCLOSE A PHOTOCOPY OF THE NOTICE OF GUARANTEED
DELIVERY IF TENDERED ORIGINAL CAPITAL SECURITIES ARE BEING DELIVERED
PURSUANT TO A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE
EXCHANGE AGENT AND COMPLETE THE FOLLOWING:
Name of Registered Holder(s):__________________________________________________
Window Ticket Number (if any):_________________________________________________
Date of Execution of Notice of Guaranteed Delivery:____________________________
Name of Institution which Guaranteed Delivery:_________________________________
If Guaranteed Delivery is to be made By Book-Entry Transfer:
Name of Tendering Institution:_________________________________________________
DTC Account Number:____________________________________________________________
Transaction Code Number:_______________________________________________________
[ ] CHECK HERE IF TENDERED BY BOOK-ENTRY TRANSFER AND NON-EXCHANGED
ORIGINAL CAPITAL SECURITIES ARE TO BE RETURNED BY CREDITING THE DTC
ACCOUNT NUMBER SET FORTH ABOVE.
[ ] CHECK HERE IF YOU ARE A BROKER-DEALER WHO ACQUIRED THE ORIGINAL
CAPITAL SECURITIES FOR ITS OWN ACCOUNT AS A RESULT OF MARKET MAKING OR
OTHER TRADING ACTIVITIES (A "PARTICIPATING BROKER-DEALER") AND WISH TO
RECEIVE 10 ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY
AMENDMENTS OR SUPPLEMENTS THERETO.
Name:__________________________________________________________________________
Address:_______________________________________________________________________
3
<PAGE> 4
Ladies and Gentlemen:
The undersigned hereby tenders to AGL Capital Trust, a statutory
business trust formed under the laws of the State of Delaware (the "Trust"),
and AGL Resources Inc., a Georgia corporation ("AGL Resources"), the above
described aggregate Liquidation Amount of the Trust's 8.17% Series A Capital
Securities (the "Original Capital Securities") in exchange for a like aggregate
Liquidation Amount of the Trust's 8.17% Series B Capital Securities (the
"Exchange Capital Securities") which have been registered under the Securities
Act of 1933, as amended (the "Securities Act"), upon the terms and subject to
the conditions set forth in the Prospectus dated _______________, 1997 (as the
same may be amended or supplemented from time to time, the "Prospectus"),
receipt of which is hereby acknowledged, and in this Letter of Transmittal
(which, together with the Prospectus, constitute the "Exchange Offer").
Subject to and effective upon the acceptance for exchange of all or
any portion of the Original Capital Securities tendered herewith in accordance
with the terms and conditions of the Exchange Offer (including, if the Exchange
Offer is extended or amended, the terms and conditions of any such extension or
amendment), the undersigned hereby sells, assigns and transfers to or upon the
order of the Trust all right, title and interest in and to such Original
Capital Securities as are being tendered herewith. The undersigned hereby
irrevocably constitutes and appoints the Exchange Agent as its agent and
attorney-in-fact (with full knowledge that the Exchange Agent is also acting as
agent of AGL Resources and the Trust in connection with the Exchange Offer)
with respect to the tendered Original Capital Securities, with full power of
substitution (such power of attorney being deemed to be an irrevocable power
coupled with an interest) subject only to the right of withdrawal described in
the Prospectus, to (i) deliver Certificates for Original Capital Securities to
AGL Resources or the Trust together with all accompanying evidences of transfer
and authenticity to, or upon the order of, the Trust, upon receipt by the
Exchange Agent, as the undersigned's agent, of the Exchange Capital Securities
to be issued in exchange for such Original Capital Securities, (ii) present
Certificates for such Original Capital Securities for transfer, and to transfer
the Original Capital Securities on the books of the Trust, and (iii) receive
for the account of the Trust all benefits and otherwise exercise all rights of
beneficial ownership of such Original Capital Securities, all in accordance
with the terms and conditions of the Exchange Offer.
THE UNDERSIGNED HEREBY REPRESENTS AND WARRANTS THAT THE UNDERSIGNED
HAS FULL POWER AND AUTHORITY TO TENDER, EXCHANGE, SELL, ASSIGN AND TRANSFER THE
ORIGINAL CAPITAL SECURITIES TENDERED HEREBY AND THAT, WHEN THE SAME ARE
ACCEPTED FOR EXCHANGE, THE TRUST WILL ACQUIRE GOOD, MARKETABLE AND UNENCUMBERED
TITLE THERETO, FREE AND CLEAR OF ALL LIENS, RESTRICTIONS, CHARGES AND
ENCUMBRANCES, AND THAT THE ORIGINAL CAPITAL SECURITIES TENDERED HEREBY ARE NOT
SUBJECT TO ANY ADVERSE CLAIMS OR PROXIES. THE UNDERSIGNED WILL, UPON REQUEST,
EXECUTE AND DELIVER ANY ADDITIONAL DOCUMENTS DEEMED BY AGL RESOURCES, THE TRUST
OR THE EXCHANGE AGENT TO BE NECESSARY OR DESIRABLE TO COMPLETE THE EXCHANGE,
ASSIGNMENT AND TRANSFER OF THE ORIGINAL CAPITAL SECURITIES TENDERED HEREBY, AND
THE UNDERSIGNED WILL COMPLY WITH ITS OBLIGATIONS UNDER THE REGISTRATION RIGHTS
AGREEMENT. THE UNDERSIGNED HAS READ AND AGREES TO ALL OF THE TERMS OF THE
EXCHANGE OFFER.
The name(s) and address(es) of the registered holder(s) (which term,
for purposes of this document, shall include any participant in DTC) of the
Original Capital Securities tendered hereby should be printed above, if they
are not already set forth above, as they appear on the Certificates
representing such Original Capital Securities. The Certificate number(s) and
the Original Capital Securities that the undersigned wishes to tender should be
indicated in the appropriate boxes above.
If any tendered Original Capital Securities are not exchanged pursuant
to the Exchange Offer for any reason, or if Certificates are submitted for more
Original Capital Securities than are tendered or accepted for exchange,
Certificates for such nonexchanged or nontendered Original Capital Securities
will be returned (or, in the case of Original Capital Securities tendered by
book-entry transfer, such Original Capital Securities will be credited to an
account maintained at DTC), without expense to the tendering holder, promptly
following the expiration or termination of the Exchange Offer.
4
<PAGE> 5
The undersigned understands that tenders of Original Capital
Securities pursuant to any one of the procedures described in "The Exchange
Offer--Procedures for Tendering Original Capital Securities" in the Prospectus
and in the instructions attached hereto will, upon AGL Resources' and the
Trust's acceptance for exchange of such tendered Original Capital Securities,
constitute a binding agreement between the undersigned, AGL Resources and the
Trust upon the terms and subject to the conditions of the Exchange Offer.
The undersigned recognizes that, under certain circumstances set forth
in the Prospectus, AGL Resources and the Trust may not be required to accept
for exchange any of the Original Capital Securities tendered hereby.
Unless otherwise indicated herein in the box entitled "Special
Issuance Instructions" below, the undersigned hereby directs that the Exchange
Capital Securities be issued in the name(s) of the undersigned or, in the case
of a book-entry transfer of Original Capital Securities, that such Exchange
Capital Securities be credited to the account indicated above maintained at
DTC. If applicable, substitute Certificates representing Original Capital
Securities not exchanged or not accepted for exchange will be issued to the
undersigned or, in the case of a book-entry transfer of Original Capital
Securities, will be credited to the account indicated above maintained at DTC.
Similarly, unless otherwise indicated under "Special Delivery Instructions,"
please deliver Exchange Capital Securities to the undersigned at the address
shown below the undersigned's signature.
BY TENDERING ORIGINAL CAPITAL SECURITIES AND EXECUTING THIS LETTER OF
TRANSMITTAL, OR EFFECTING DELIVERY OF AN AGENT'S MESSAGE IN LIEU THEREOF, THE
UNDERSIGNED HEREBY REPRESENTS AND AGREES THAT (I) THE UNDERSIGNED IS NOT AN
"AFFILIATE" (WITHIN THE MEANING OF THE SECURITIES ACT) OF AGL RESOURCES OR THE
TRUST, (II) ANY EXCHANGE CAPITAL SECURITIES TO BE RECEIVED BY THE UNDERSIGNED
ARE BEING ACQUIRED IN THE ORDINARY COURSE OF ITS BUSINESS, (III) THE
UNDERSIGNED HAS NO ARRANGEMENT OR UNDERSTANDING WITH ANY PERSON TO PARTICIPATE
IN A DISTRIBUTION (WITHIN THE MEANING OF THE SECURITIES ACT) OF EXCHANGE
CAPITAL SECURITIES TO BE RECEIVED IN THE EXCHANGE OFFER, AND (IV) IF THE
UNDERSIGNED IS NOT A BROKER-DEALER, THE UNDERSIGNED IS NOT ENGAGED IN, AND DOES
NOT INTEND TO ENGAGE IN, A DISTRIBUTION (WITHIN THE MEANING OF THE SECURITIES
ACT) OF SUCH EXCHANGE CAPITAL SECURITIES. BY TENDERING ORIGINAL CAPITAL
SECURITIES PURSUANT TO THE EXCHANGE OFFER AND EXECUTING THIS LETTER OF
TRANSMITTAL, OR EFFECTING DELIVERY OF AN AGENT'S MESSAGE IN LIEU THEREOF, A
HOLDER OF ORIGINAL CAPITAL SECURITIES THAT IS A BROKER-DEALER REPRESENTS AND
AGREES, CONSISTENT WITH CERTAIN INTERPRETIVE LETTERS ISSUED BY THE STAFF OF THE
DIVISION OF CORPORATION FINANCE OF THE SECURITIES AND EXCHANGE COMMISSION TO
THIRD PARTIES, THAT (A) SUCH ORIGINAL CAPITAL SECURITIES HELD BY THE
BROKER-DEALER ARE HELD ONLY AS A NOMINEE, OR (B) SUCH ORIGINAL CAPITAL
SECURITIES WERE ACQUIRED BY SUCH BROKER-DEALER FOR ITS OWN ACCOUNT AS A RESULT
OF MARKET-MAKING ACTIVITIES OR OTHER TRADING ACTIVITIES AND IT WILL DELIVER THE
PROSPECTUS (AS AMENDED OR SUPPLEMENTED FROM TIME TO TIME) MEETING THE
REQUIREMENTS OF THE SECURITIES ACT IN CONNECTION WITH ANY RESALE OF SUCH
EXCHANGE CAPITAL SECURITIES (PROVIDED THAT, BY SO ACKNOWLEDGING AND BY
DELIVERING A PROSPECTUS, SUCH BROKER-DEALER WILL NOT BE DEEMED TO ADMIT THAT IT
IS AN "UNDERWRITER" WITHIN THE MEANING OF THE SECURITIES ACT).
AGL RESOURCES AND THE TRUST HAVE AGREED THAT, SUBJECT TO THE
PROVISIONS OF THE REGISTRATION RIGHTS AGREEMENT, THE PROSPECTUS, AS IT MAY BE
AMENDED OR SUPPLEMENTED FROM TIME TO TIME, MAY BE USED BY A PARTICIPATING
BROKER-DEALER (AS DEFINED BELOW) IN CONNECTION WITH RESALES OF EXCHANGE CAPITAL
SECURITIES RECEIVED IN EXCHANGE FOR ORIGINAL CAPITAL SECURITIES, WHERE SUCH
ORIGINAL CAPITAL SECURITIES WERE ACQUIRED BY SUCH PARTICIPATING BROKER-DEALER
FOR ITS OWN ACCOUNT AS A RESULT OF MARKET-MAKING ACTIVITIES OR OTHER TRADING
ACTIVITIES, FOR A PERIOD ENDING 180 DAYS AFTER THE EXPIRATION DATE (SUBJECT TO
EXTENSION UNDER CERTAIN LIMITED CIRCUMSTANCES DESCRIBED IN THE PROSPECTUS) OR,
IF EARLIER, WHEN ALL SUCH EXCHANGE CAPITAL SECURITIES HAVE BEEN DISPOSED OF BY
SUCH PARTICIPATING BROKER-DEALER. IN THAT REGARD, EACH BROKER-DEALER WHO
ACQUIRED ORIGINAL CAPITAL SECURITIES FOR ITS OWN ACCOUNT AS A RESULT OF
5
<PAGE> 6
MARKET-MAKING OR OTHER TRADING ACTIVITIES (A "PARTICIPATING BROKER-DEALER"), BY
TENDERING SUCH ORIGINAL CAPITAL SECURITIES AND EXECUTING THIS LETTER OF
TRANSMITTAL, OR EFFECTING DELIVERY OF AN AGENT'S MESSAGE IN LIEU THEREOF,
AGREES THAT, UPON RECEIPT OF NOTICE FROM AGL RESOURCES OR THE TRUST OF THE
OCCURRENCE OF ANY EVENT OR THE DISCOVERY OF ANY FACT WHICH MAKES ANY STATEMENT
CONTAINED OR INCORPORATED BY REFERENCE IN THE PROSPECTUS UNTRUE IN ANY MATERIAL
RESPECT OR WHICH CAUSES THE PROSPECTUS TO OMIT TO STATE A MATERIAL FACT
NECESSARY IN ORDER TO MAKE THE STATEMENTS CONTAINED OR INCORPORATED BY
REFERENCE THEREIN, IN LIGHT OF THE CIRCUMSTANCES UNDER WHICH THEY WERE MADE,
NOT MISLEADING OR OF THE OCCURRENCE OF CERTAIN OTHER EVENTS SPECIFIED IN THE
REGISTRATION RIGHTS AGREEMENT, SUCH PARTICIPATING BROKER-DEALER WILL SUSPEND
THE SALE OF EXCHANGE CAPITAL SECURITIES PURSUANT TO THE PROSPECTUS UNTIL AGL
RESOURCES AND THE TRUST HAVE AMENDED OR SUPPLEMENTED THE PROSPECTUS TO CORRECT
SUCH MISSTATEMENT OR OMISSION AND HAVE FURNISHED COPIES OF THE AMENDED OR
SUPPLEMENTED PROSPECTUS TO THE PARTICIPATING BROKER-DEALER OR AGL RESOURCES OR
THE TRUST HAS GIVEN NOTICE THAT THE SALE OF THE EXCHANGE CAPITAL SECURITIES MAY
BE RESUMED, AS THE CASE MAY BE. IF AGL RESOURCES OR THE TRUST GIVES SUCH NOTICE
TO SUSPEND THE SALE OF THE EXCHANGE CAPITAL SECURITIES, THEY SHALL EXTEND THE
180-DAY PERIOD REFERRED TO ABOVE DURING WHICH PARTICIPATING BROKER-DEALERS ARE
ENTITLED TO USE THE PROSPECTUS IN CONNECTION WITH THE RESALE OF EXCHANGE
CAPITAL SECURITIES BY THE NUMBER OF DAYS DURING THE PERIOD FROM AND INCLUDING
THE DATE OF THE GIVING OF SUCH NOTICE TO AND INCLUDING THE DATE WHEN
PARTICIPATING BROKER-DEALERS SHALL HAVE RECEIVED COPIES OF THE SUPPLEMENTED OR
AMENDED PROSPECTUS NECESSARY TO PERMIT RESALES OF THE EXCHANGE CAPITAL
SECURITIES OR TO AND INCLUDING THE DATE ON WHICH AGL RESOURCES OR THE TRUST HAS
GIVEN NOTICE THAT THE SALE OF EXCHANGE CAPITAL SECURITIES MAY BE RESUMED, AS
THE CASE MAY BE.
AS A RESULT, A PARTICIPATING BROKER-DEALER WHO INTENDS TO USE THE
PROSPECTUS IN CONNECTION WITH RESALES OF EXCHANGE CAPITAL SECURITIES RECEIVED
IN EXCHANGE FOR ORIGINAL CAPITAL SECURITIES PURSUANT TO THE EXCHANGE OFFER MUST
NOTIFY AGL RESOURCES AND THE TRUST, OR CAUSE AGL RESOURCES AND THE TRUST TO BE
NOTIFIED, ON OR PRIOR TO THE EXPIRATION DATE, THAT IT IS A PARTICIPATING
BROKER-DEALER. SUCH NOTICE MAY BE GIVEN IN THE SPACE PROVIDED ABOVE OR MAY BE
DELIVERED TO THE EXCHANGE AGENT AT THE ADDRESS SET FORTH IN THE PROSPECTUS
UNDER "THE EXCHANGE OFFER--EXCHANGE AGENT."
Holders of Original Capital Securities whose Original Capital
Securities are accepted for exchange will not receive Distributions on such
Original Capital Securities and the undersigned waives the right to receive any
Distributions on such Original Capital Securities accumulated from and
including _______________, 1997. Accordingly, holders of Exchange Capital
Securities as of the record date for the payment of Distributions on
_______________, 1997 will be entitled to Distributions accumulated from and
including _______________, 1997.
The undersigned will, upon request, execute and deliver any additional
documents deemed by AGL Resources or the Trust to be necessary or desirable to
complete the sale, assignment and transfer of the Original Capital Securities
tendered hereby. All authority herein conferred or agreed to be conferred in
this Letter of Transmittal shall survive the death or incapacity of the
undersigned and any obligation of the undersigned hereunder shall be binding
upon the heirs, executors, administrators, personal representatives, trustees
in bankruptcy, legal representatives, successors and assigns of the
undersigned. Except as stated in the Prospectus, this tender is irrevocable.
THE UNDERSIGNED, BY COMPLETING THE BOX ENTITLED "DESCRIPTION OF ORIGINAL CAPITAL
SECURITIES TENDERED" ABOVE AND SIGNING THIS LETTER, WILL BE DEEMED TO HAVE
TENDERED THE ORIGINAL CAPITAL SECURITIES AS SET FORTH IN SUCH BOX.
6
<PAGE> 7
HOLDER(S) PLEASE SIGN HERE
(SEE INSTRUCTIONS 2, 5 AND 6)
(PLEASE COMPLETE SUBSTITUTE FORM W-9 ON PAGE ____)
(NOTE: SIGNATURE(S) MUST BE GUARANTEED IF REQUIRED BY INSTRUCTION 2.)
This Letter of Transmittal must be signed by registered holder(s)
(which term, for purposes of this document, shall include any participant in
DTC) exactly as such holder(s) name(s) appear(s) on Certificate(s) for the
Original Capital Securities hereby tendered or on the register of holders
maintained by the Trust, or by any person(s) authorized to become the
registered holder(s) by endorsements and documents transmitted herewith
(including such opinions of counsel, certifications and other information as
may be required by the Trust or the Trustee for the Original Capital Securities
to comply with the restrictions on transfer applicable to the Original Capital
Securities). If signature is by an attorney-in-fact, executor, administrator,
trustee, guardian, officer of a corporation or another acting in a fiduciary
capacity or representative capacity, please set forth the signer's full title.
See Instruction 5.
X_______________________________________________________________________________
X_______________________________________________________________________________
Signature(s) of Holders(s)
Date:________________________________
Name(s):________________________________________________________________________
________________________________________________________________________
(Please Type or Print)
Capacity (full title):__________________________________________________________
Address: _______________________________________________________________________
_______________________________________________________________________
(Include Zip Code)
Area Code and Telephone Number:_________________________________________________
________________________________________________________________________________
(Tax Identification or Social Security Number(s))
GUARANTEE OF SIGNATURE(S)
(SEE INSTRUCTIONS 2 AND 5)
Signature(s) Guaranteed by an
Eligible Institution:___________________________________________________________
(Authorized Signature)
Date:___________________
Name of Firm:___________________________________________________________________
Capacity (full title):__________________________________________________________
(Please Type or Print)
Address:________________________________________________________________________
________________________________________________________________________
7
<PAGE> 8
SPECIAL ISSUANCE INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5 AND 6)
To be completed ONLY if Exchange Capital Securities or Original Capital
Securities not tendered are to be issued in the name of someone other than the
registered holder of the Original Capital Securities whose name(s) appear(s)
above.
Issue
[ ] Original Capital Securities
not tendered to:
[ ] Exchange Capital Securities
to:
Name(s):_________________________________________
_________________________________________
(Please Type or Print)
Address:_________________________________________
_________________________________________________
(Include Zip Code)
Area Code and
Telephone Number:________________________________
_________________________________________________
(Tax Identification or Social Security Number(s)
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5 AND 6)
To be completed ONLY if Exchange Capital Securities or Original Capital
Securites not tendered are to be sent to someone other than the registered
holder of the Original Capital Securities whose name(s) appear(s) above, or to
such registered holder(s) at an address other than that shown above.
Mail
[ ] Original Capital Securities
not tendered to:
[ ] Exchange Capital Securities
to:
Name(s):_____________________________________________
_____________________________________________
(Please Type or Print)
Address:_____________________________________________
_____________________________________________________
(Include Zip Code)
Area Code and
Telephone Number:____________________________________
_____________________________________________________
8
<PAGE> 9
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE EXCHANGE OFFER
1. DELIVERY OF LETTER OF TRANSMITTAL AND CERTIFICATES;
GUARANTEED DELIVERY PROCEDURES.
This Letter of Transmittal is to be completed either if (a) Certificates
are to be forwarded herewith or (b) tenders are to be made pursuant to the
procedures for tender by book-entry transfer set forth in "The Exchange
Offer--Procedures for Tendering Original Capital Securities" in the Prospectus.
Certificates, or timely confirmation of a book-entry transfer of such Original
Capital Securities into the Exchange Agent's account at DTC, as well as this
Letter of Transmittal (or facsimile thereof), properly completed and duly
executed, with any required signature guarantees, or an Agent's Message in lieu
thereof, and any other documents required by this Letter of Transmittal, must
be received by the Exchange Agent at its address set forth herein on or prior
to the Expiration Date. Original Capital Securities may be tendered in whole or
in part in the principal amount of $100,000 (100 Capital Securities) and
integral multiples of $1,000 in excess thereof, provided that, if any Original
Capital Securities are tendered for exchange in part, the untendered principal
amount thereof must be $100,000 (100 Capital Securities) or any integral
multiple of $1,000 in excess thereof.
Holders who wish to tender their Original Capital Securities and (i) whose
Original Capital Securities are not immediately available or (ii) who cannot
deliver their Original Capital Securities, this Letter of Transmittal and all
other required documents to the Exchange Agent on or prior to the Expiration
Date or (iii) who cannot complete the procedures for delivery by book-entry
transfer on a timely basis, may tender their Original Capital Securities by
properly completing and duly executing a Notice of Guaranteed Delivery pursuant
to the guaranteed delivery procedures set forth in "The Exchange
Offer--Procedures for Tendering Original Capital Securities" in the Prospectus.
Pursuant to such procedures: (i) such tender must be made by or through an
Eligible Institution (as defined below); (ii) a properly completed and duly
executed Notice of Guaranteed Delivery, substantially in the form made
available by the Trust, must be received by the Exchange Agent on or prior to
the Expiration Date; and (iii) the Certificates (or a book-entry confirmation
(as defined in this Letter of Transmittal)) representing all tendered Original
Capital Securities, in proper form for transfer, together with a Letter of
Transmittal (or facsimile thereof), properly completed and duly executed, with
any required signature guarantees, or an Agent's Message in lieu thereof, and
any other documents required by this Letter of Transmittal, must be received by
the Exchange Agent within three New York Stock Exchange, Inc. trading days
after the date of execution of such Notice of Guaranteed Delivery, all as
provided in "The Exchange Offer--Procedures for Tendering Original Capital
Securities" in the Prospectus.
The Notice of Guaranteed Delivery may be delivered by hand or transmitted
by facsimile or mail to the Exchange Agent, and must include a guarantee by an
Eligible Institution in the form set forth in such Notice. For Original Capital
Securities to be properly tendered pursuant to the guaranteed delivery
procedure, the Exchange Agent must receive a Notice of Guaranteed Delivery on
or prior to the Expiration Date. As used herein and in the Prospectus,
"Eligible Institution" means a firm or other entity identified in Rule 17Ad-15
under the Exchange Act as an "Eligible Guarantor Institution," including (as
such terms are defined therein) (i) a bank; (ii) a broker, dealer, municipal
securities broker or dealer or government securities broker or dealer; (iii) a
credit union; (iv) a national securities exchange, registered securities
association or clearing agency; or (v) a savings association that is a
participant in a Securities Transfer Association.
THE METHOD OF DELIVERY OF CERTIFICATES, THIS LETTER OF TRANSMITTAL AND ALL
OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND SOLE RISK OF THE TENDERING HOLDER
AND THE DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE
EXCHANGE AGENT. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT
REQUESTED, PROPERLY INSURED, OR OVERNIGHT DELIVERY SERVICE IS RECOMMENDED. IN
ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
9
<PAGE> 10
Neither AGL Resources nor the Trust will accept any alternative,
conditional or contingent tenders. Each tendering holder, by execution of a
Letter of Transmittal (or facsimile thereof), or delivery of an Agent's Message
in lieu thereof, waives any right to receive any notice of the acceptance of
such tender.
2. GUARANTEE OF SIGNATURES.
No signature guarantee on this Letter of Transmittal is required if:
(i) this Letter of Transmittal is signed by the registered holder
(which term, for purposes of this document, shall include any participant
in DTC whose name appears on a security position listing as the owner of
the Original Capital Securities) of Original Capital Securities tendered
herewith, unless such holder(s) has completed either the box entitled
"Special Issuance Instructions" or the box entitled "Special Delivery
Instructions" above, or
(ii) such Original Capital Securities are tendered for the account of
a firm that is an Eligible Institution.
In all other cases, an Eligible Institution must guarantee the
signature(s) on this Letter of Transmittal. See Instruction 5.
3. INADEQUATE SPACE.
If the space provided in the box captioned "Description of Original
Capital Securities" is inadequate, the Certificate number(s) and/or the
principal amount of Original Capital Securities and any other required
information should be listed on a separate signed schedule which is attached to
this Letter of Transmittal.
4. PARTIAL TENDERS AND WITHDRAWAL RIGHTS.
Tenders of Original Capital Securities will be accepted only in the
principal amount of $100,000 (100 Capital Securities) and integral multiples of
$1,000 in excess thereof, provided that if any Original Capital Securities are
tendered for exchange in part, the untendered principal amount thereof must be
$100,000 (100 Capital Securities) or any integral multiple of $1,000 in excess
thereof. If less than all the Original Capital Securities evidenced by any
Certificate submitted are to be tendered, fill in the principal amount of
Original Capital Securities which are to be tendered in the box entitled
"Principal Amount of Original Capital Securities Tendered" (if less than all).
In such case, new Certificate(s) for the remainder of the Original Capital
Securities that were evidenced by your old Certificate(s) will only be sent to
the holder of the Original Capital Security, promptly after the Expiration
Date. All Original Capital Securities represented by Certificates delivered to
the Exchange Agent will be deemed to have been tendered unless otherwise
indicated.
Except as otherwise provided herein, tenders of Original Capital
Securities may be withdrawn at any time on or prior to the Expiration Date. In
order for a withdrawal to be effective on or prior to that time, a written,
telegraphic, telex or facsimile transmission of such notice of withdrawal must
be timely received by the Exchange Agent at one of its addresses set forth
above or in the Prospectus on or prior to the Expiration Date. Any such notice
of withdrawal must specify the name of the person who tendered the Original
Capital Securities to be withdrawn, the aggregate principal amount of Original
Capital Securities to be withdrawn, and (if Certificates for Original Capital
Securities have been tendered) the name of the registered holder of the
Original Capital Securities as set forth on the Certificate for the Original
Capital Securities, if different from that of the person who tendered such
Original Capital Securities. If Certificates for the Original Capital
Securities have been delivered or otherwise identified to the Exchange Agent,
then prior to the physical release of such Certificates for the Original
Capital Securities, the tendering holder must submit the serial numbers shown
on the particular Certificates for the Original Capital Securities to be
withdrawn and the signature on the notice of withdrawal must be guaranteed by
an Eligible Institution, except in the case of Original Capital Securities
tendered for the account of an Eligible Institution. If Original Capital
Securities have been tendered pursuant to the procedures for book-entry
transfer set forth in the Prospectus under "The Exchange Offer--Procedures for
Tendering Original Capital Securities," the notice of withdrawal must specify
the name and number of the account
10
<PAGE> 11
at DTC to be credited with the withdrawal of Original Capital Securities, in
which case a notice of withdrawal will be effective if delivered to the
Exchange Agent by written, telegraphic, telex or facsimile transmission.
Withdrawals of tenders of Original Capital Securities may not be rescinded.
Original Capital Securities properly withdrawn will not be deemed validly
tendered for purposes of the Exchange Offer, but may be retendered at any
subsequent time on or prior to the Expiration Date by following any of the
procedures described in the Prospectus under "The Exchange Offer--Procedures
for Tendering Original Capital Securities."
All questions as to the validity, form and eligibility (including time of
receipt) of such withdrawal notices will be determined by AGL Resources and the
Trust, in their sole discretion, whose determination shall be final and binding
on all parties. Neither AGL Resources, the Trust, any affiliates or assigns of
AGL Resources or the Trust, the Exchange Agent nor any other person shall be
under any duty to give any notification of any irregularities in any notice of
withdrawal or incur any liability for failure to give any such notification.
Any Original Capital Securities which have been tendered but which are
withdrawn will be returned to the holder thereof without cost to such holder
promptly after withdrawal.
5. SIGNATURES ON LETTER OF TRANSMITTAL, ASSIGNMENTS AND ENDORSEMENTS.
If this Letter of Transmittal is signed by the registered holder(s) of the
Original Capital Securities tendered hereby, the signature(s) must correspond
exactly with the name(s) as written on the face of the Certificate(s) without
alteration, enlargement or any change whatsoever.
If any of the Original Capital Securities tendered hereby are owned of
record by two or more joint owners, all such owners must sign this Letter of
Transmittal.
If any tendered Original Capital Securities are registered in different
name(s) on several Certificates, it will be necessary to complete, sign and
submit as many separate Letters of Transmittal (or facsimiles thereof) as there
are different registrations of Certificates.
If this Letter of Transmittal or any Certificates or bond powers are
signed by trustees, executors, administrators, guardians, attorneys-in-fact,
officers of corporations or others acting in a fiduciary or representative
capacity, such persons should so indicate when signing and must submit proper
evidence satisfactory to AGL Resources and the Trust, in their sole discretion,
of each such person's authority so to act.
When this Letter of Transmittal is signed by the registered owner(s) of
the Original Capital Securities listed and transmitted hereby, no
endorsement(s) of Certificate(s) or separate bond power(s) are required unless
Exchange Capital Securities are to be issued in the name of a person other than
the registered holder(s). Signature(s) on such Certificate(s) or bond power(s)
must be guaranteed by an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the
registered owner(s) of the Original Capital Securities listed, the Certificates
must be endorsed or accompanied by appropriate bond powers, signed exactly as
the name or names of the registered owner(s) appear(s) on the Certificates, and
also must be accompanied by such opinions of counsel, certifications and other
information as AGL Resources, the Trust or the Trustee for the Original Capital
Securities may require in accordance with the restrictions on transfer
applicable to the Original Capital Securities. Signatures on such Certificates
or bond powers must be guaranteed by an Eligible Institution.
6. SPECIAL ISSUANCE AND DELIVERY INSTRUCTIONS.
If Exchange Capital Securities are to be issued in the name of a person
other than the signer of this Letter of Transmittal, or if Exchange Capital
Securities are to be sent to someone other than the signer of this Letter of
Transmittal or to an address other than that shown above, the appropriate boxes
on this Letter of Transmittal should be completed. Certificates for Original
Capital Securities not exchanged will be returned by mail or, if tendered by
book-entry transfer, by crediting the account indicated above maintained at
DTC. See Instruction 4. The holder of the Original Capital Securities must pay
or cause to be paid any and all stock transfer taxes applicable to the issuance
of Exchange Capital Securities in the name of a person other than such holder.
11
<PAGE> 12
7. IRREGULARITIES.
AGL Resources and the Trust will determine, in their sole discretion, all
questions as to the form of documents, validity, eligibility (including time of
receipt) and acceptance for exchange of any tender of Original Capital
Securities, which determination shall be final and binding on all parties. AGL
Resources and the Trust reserve the absolute right to reject any and all
tenders determined by either of them not to be in proper form or the acceptance
of which, or exchange for which, may, in the view of counsel to AGL Resources
and the Trust be unlawful. AGL Resources and the Trust also reserve the
absolute right, subject to applicable law, to waive any of the conditions of
the Exchange Offer set forth in the Prospectus under "The Exchange
Offer--Conditions to the Exchange Offer" or any conditions or irregularity in
any tender of Original Capital Securities of any particular holder whether or
not similar conditions or irregularities are waived in the case of other
holders. AGL Resources' and the Trust's interpretation of the terms and
conditions of the Exchange Offer (including this Letter of Transmittal and the
instructions hereto) will be final and binding. No tender of Original Capital
Securities will be deemed to have been validly made until all irregularities
with respect to such tender have been cured or waived. AGL Resources, the
Trust, any affiliates or assigns of AGL Resources, the Trust, the Exchange
Agent, or any other person shall not be under any duty to give notification of
any irregularities in tenders or incur any liability for failure to give such
notification.
8. QUESTIONS, REQUESTS FOR ASSISTANCE AND ADDITIONAL COPIES.
Questions and requests for assistance may be directed to the Exchange
Agent at its address and telephone number set forth on the front of this Letter
of Transmittal. Additional copies of the Prospectus, the Notice of Guaranteed
Delivery and this Letter of Transmittal may be obtained from the Exchange Agent
or from your broker, dealer, commercial bank, trust company or other nominee.
9. 31% BACKUP WITHHOLDING; SUBSTITUTE FORM W-9.
Under U.S. Federal income tax law, a holder whose tendered Original
Capital Securities are accepted for exchange is required to provide the
Exchange Agent with such holder's correct taxpayer identification number (e.g.,
social security number or employer identification number) ("TIN") on Substitute
Form W-9 below. The holder is required to give the Exchange Agent the TIN of
the registered owner of the Original Capital Securities or of the last
transferee appearing on the transfers attached to, or endorsed on, the Original
Capital Securities. If the Exchange Agent is not provided with the correct TIN,
the Internal Revenue Service (the "IRS") may subject the holder or other payee
to a $50 penalty. In addition, payments to such holders or other payees with
respect to Original Capital Securities exchanged pursuant to the Exchange Offer
may be subject to 31% backup withholding.
The box in Part II of the Substitute Form W-9 may be checked if the
tendering holder has not been issued a TIN and has applied for a TIN or intends
to apply for a TIN in the near future. If the box in Part II is checked, the
holder or other payee must also complete the Certificate of Awaiting Taxpayer
Identification Number below in order to avoid backup withholding.
Notwithstanding that the box in Part II is checked and the Certificate of
Awaiting Taxpayer Identification Number is completed, the Exchange Agent will
withhold 31% of all payments made prior to the time a properly certified TIN is
provided to the Exchange Agent. The Exchange Agent will retain such amounts
withheld during the 60-day period following the date of the Substitute Form
W-9. If the holder furnishes the Exchange Agent with its TIN within 60 days
after the date of the Substitute Form W- 9, the amounts retained during the
60-day period will be remitted to the holder and no further amounts shall be
retained or withheld from payments made to the holder thereafter. If, however,
the holder has not provided the Exchange Agent with its TIN within such 60-day
period, amounts withheld will be remitted to the IRS as backup withholding. In
addition, 31% of all payments made thereafter will be withheld and remitted to
the IRS until a correct TIN is provided.
Certain holders (including, among others, corporations, financial
institutions and certain foreign persons) may not be subject to these backup
withholding and reporting requirements. Such holders should nevertheless
complete the attached Substitute Form W-9 below, and write "exempt" on the face
thereof, to avoid possible erroneous backup withholding. A foreign person may
qualify as an exempt recipient by submitting a properly completed IRS Form W-8,
signed under penalties of perjury, attesting to that holder's exempt status.
12
<PAGE> 13
Backup withholding is not an additional U.S. Federal income tax. Rather,
the U.S. Federal income tax liability of a person subject to backup withholding
will be reduced by the amount of tax withheld. If withholding results in an
overpayment of taxes, a refund may be obtained.
10. WAIVER OF CONDITIONS.
AGL Resources and the Trust reserve the absolute right to waive
satisfaction of any or all conditions enumerated in the Prospectus.
11. NO CONDITIONAL TENDERS.
No alternative, conditional or contingent tenders will be accepted. All
tendering holders of Original Capital Securities, by execution of this Letter
of Transmittal, shall waive any right to receive notice of the acceptance of
Original Capital Securities for exchange.
Neither AGL Resources, the Trust, the Exchange Agent nor any other person
is obligated to give notice of any defect or irregularity with respect to any
tender of Original Capital Securities nor shall any of them incur any liability
for failure to give any such notice.
12. LOST, DESTROYED OR STOLEN CERTIFICATES.
If any Certificate(s) representing Original Capital Securities have been
lost, destroyed or stolen, the holder should promptly notify the Exchange
Agent. The holder will then be instructed as to the steps that must be taken in
order to replace the Certificate(s). This Letter of Transmittal and related
documents cannot be processed until the procedures for replacing lost,
destroyed or stolen Certificate(s) have been followed.
13. SECURITY TRANSFER TAXES.
Holders who tender their Original Capital Securities for exchange will not
be obligated to pay any transfer taxes in connection therewith. If, however,
Exchange Capital Securities are to be delivered to, or are to be issued in the
name of, any person other than the registered holder of the Original Capital
Securities tendered, or if a transfer tax is imposed for any reason other than
the exchange of Original Capital Securities in connection with the Exchange
Offer, then the amount of any such transfer tax (whether imposed on the
registered holder or any other persons) will be payable by the tendering
holder. If satisfactory evidence of payment of such taxes or exemption
therefrom is not submitted with the Letter of Transmittal, the amount of such
transfer taxes will be billed directly to such tendering holder.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR FACSIMILE THEREOF) AND ALL OTHER
REQUIRED DOCUMENTS MUST BE RECEIVED BY THE EXCHANGE AGENT ON OR PRIOR TO THE
EXPIRATION DATE.
13
<PAGE> 14
TO BE COMPLETED BY ALL TENDERING SECURITY HOLDERS
(SEE INSTRUCTION 9)
PAYOR'S NAME: AGL CAPITAL TRUST
- --------------------------------------------------------------------------------
SUBSTITUTE
FORM W-9
DEPARTMENT OF THE TREASURY
INTERNAL REVENUE SERVICE
PAYOR'S REQUEST FOR TAXPAYER IDENTIFICATION NUMBER ("TIN") AND CERTIFICATION
- --------------------------------------------------------------------------------
PART I -- Please provide your TIN
in the box at right and certify by ___________________________________
signing and dating below Social Security Number
OR
___________________________________
Employer Identification Number
- --------------------------------------------------------------------------------
PART II -- TIN Applied For [ ]
- --------------------------------------------------------------------------------
CERTIFICATION -- UNDER PENALTIES OF PERJURY, I
CERTIFY THAT:
(1) the number shown on this form is my correct taxpayer identification number
(or I am waiting for a number to be issued to me),
(2) I am not subject to backup withholding either because (i) I am exempt from
backup withholding, (ii) I have not been notified by the Internal Revenue
Service ("IRS") that I am subject to backup withholding as a result of a
failure to report all interest or dividends, or (iii) the IRS has notified
me that I am no longer subject to backup withholding, and
(3) the other information provided on this form is true and correct.
- --------------------------------------------------------------------------------
SIGNATURE___________________________________ DATE___________________
- --------------------------------------------------------------------------------
You must cross out all of item (2) above if you have been notified by the IRS
that you are subject to backup withholding because of under reporting interest
or dividends on your tax return and you have not been notified by the IRS that
you are no longer subject to backup withhholding.
- --------------------------------------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY IN CERTAIN CIRCUMSTANCES
RESULT IN BACKUP WITHHOLDING OF 31% OF ANY AMOUNTS PAID TO YOU
PURSUANT TO THE EXCHANGE OFFER. PLEASE REVIEW THE ENCLOSED GUIDELINES
FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM
W-9 FOR ADDITIONAL DETAILS.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART II
OF THE SUBSTITUTE FORM W-9.
14
<PAGE> 15
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number
has not been issued to me, and either (1) I have mailed or delivered an
application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or Social Security Administration Office or (2)
I intend to mail or deliver an application in the near future. I understand
that if I do not provide a taxpayer identification number by the time of
payment, 31% of all payments made to me on account of the Exchange Capital
Securities shall be retained until I provide a taxpayer identification number
to the Exchange Agent and that, if I do not provide my taxpayer identification
number within 60 days, such retained amounts shall be remitted to the Internal
Revenue Service as backup withholding and 31% of all reportable payments made
to me thereafter will be withheld and remitted to the Internal Revenue Service
until I provide a taxpayer identification number.
SIGNATURE DATE
------------------------------------------ ---------------------
15
<PAGE> 16
AGL CAPITAL TRUST
OFFER TO EXCHANGE ITS
8.17% SERIES B CAPITAL SECURITIES
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
FOR ANY AND ALL OUTSTANDING
8.17% SERIES A CAPITAL SECURITIES
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
FULLY AND UNCONDITIONALLY GUARANTEED BY
AGL RESOURCES INC.
To: Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
AGL Resources Inc. (the "AGL Resources") and AGL Capital Trust (the
"Trust") are offering, upon and subject to the terms and conditions set forth
in a Prospectus dated _______________, 1997 (the "Prospectus"), and the
enclosed letter of transmittal (the "Letter of Transmittal"), to exchange (the
"Exchange Offer") the Trust's 8.17% Series B Capital Securities (the "Exchange
Capital Securities") for its outstanding 8.17% Series A Capital Securities (the
"Original Capital Securities"). The Exchange Offer is being made in order to
satisfy certain obligations of the Company and the Trust contained in the
Registration Rights Agreement, dated June 11, 1997, among AGL Resources, the
Trust and the initial purchasers referred to therein.
We are requesting that you contact your clients for whom you hold Original
Capital Securities regarding the Exchange Offer. For your information and for
forwarding to your clients for whom you hold Original Capital Securities
registered in your name or in the name of your nominee, or who hold Original
Capital Securities registered in their own names, we are enclosing the
following documents:
1. Prospectus dated _______________, 1997;
2. The Letter of Transmittal for your use and for the information
(or the use, where relevant) of your clients;
3. A Notice of Guaranteed Delivery to be used to accept the Exchange
Offer if certificates for Original Capital Securities are not immediately
available or time will not permit all required documents to reach the Exchange
Agent prior to the Expiration Date (as defined below) or if the procedure for
book-entry transfer cannot be completed on a timely basis;
4. A form of letter which may be sent to your clients for whose
account you hold Original Capital Securities registered in your name or the
name of your nominee, with space provided for obtaining such clients'
instructions with regard to the Exchange Offer; and
5. Return envelopes addressed to The Bank of New York, the Exchange
Agent for Original Capital Securities.
YOUR PROMPT ACTION IS REQUESTED. THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON _______________, 1997, OR SUCH LATER DATE AND TIME TO
WHICH THE EXCHANGE OFFER MAY BE EXTENDED (THE "EXPIRATION DATE"). THE ORIGINAL
CAPITAL SECURITIES TENDERED PURSUANT TO THE EXCHANGE OFFER MAY BE WITHDRAWN AT
ANY TIME BEFORE THE EXPIRATION DATE.
To participate in the Exchange Offer, a duly executed and properly
completed Letter of Transmittal (or facsimile thereof or an Agent's Message (as
defined in the Letter of Transmittal) in lieu thereof), with any required
signature guarantees and any other required documents, should be sent to the
Exchange Agent and certificates representing the Original Capital Securities
should be delivered to the Exchange Agent, all in accordance with the
instructions set forth in the Letter of Transmittal and the Prospectus.
<PAGE> 17
If holders of Original Capital Securities wish to tender, but it is
impracticable for them to forward their certificates for Original Capital
Securities prior to the expiration of the Exchange Offer or to comply with the
book-entry transfer procedures on a timely basis, a tender may be effected by
following the guaranteed delivery procedures described in the Prospectus under
"The Exchange Offer--Procedures for Tendering Original Capital Securities."
AGL Resources will, upon request, reimburse brokers, dealers, commercial
banks and trust companies for reasonable and necessary costs and expenses
incurred by them in forwarding the Prospectus and the related documents to the
beneficial owners of Original Capital Securities held by them as nominee or in
a fiduciary capacity. AGL Resources will pay or cause to be paid all stock
transfer taxes applicable to the exchange of Original Capital Securities
pursuant to the Exchange Offer, except as set forth in Instruction 6 of the
Letter of Transmittal.
Any inquiries you may have with respect to the Exchange Offer, or requests
for additional copies of the enclosed materials, should be directed to The Bank
of New York, the Exchange Agent for the Original Capital Securities, at its
address and telephone number set forth on the front of the Letter of
Transmittal.
Very truly yours,
AGL Resources Inc.
AGL Capital Trust
NOTHING HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR ANY PERSON
AS AN AGENT OF AGL RESOURCES, THE TRUST OR THE EXCHANGE AGENT, OR AUTHORIZE YOU
OR ANY OTHER PERSON TO USE ANY DOCUMENT OR MAKE ANY STATEMENTS ON BEHALF OF AGL
RESOURCES, THE TRUST OR THE EXCHANGE AGENT WITH RESPECT TO THE EXCHANGE OFFER,
EXCEPT FOR STATEMENTS EXPRESSLY MADE IN THE PROSPECTUS OR THE LETTER OF
TRANSMITTAL.
Enclosures
2
<PAGE> 18
AGL CAPITAL TRUST
OFFER TO EXCHANGE ITS
8.17% SERIES B CAPITAL SECURITIES
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
FOR ANY AND ALL OUTSTANDING
8.17% SERIES A CAPITAL SECURITIES
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
FULLY AND UNCONDITIONALLY GUARANTEED BY
AGL RESOURCES INC.
To Our Clients:
Enclosed for your consideration is a Prospectus dated __________, 1997
(the "Prospectus"), and the related letter of transmittal (the "Letter of
Transmittal"), relating to the offer (the "Exchange Offer") of AGL Resources
Inc. (the "AGL Resources") and AGL Capital Trust (the "Trust") to exchange the
Trust's 8.17% Series B Capital Securities (the "Exchange Capital Securities")
for its outstanding 8.17% Series A Capital Securities (the "Original Capital
Securities"), upon the terms and subject to the conditions described in the
Prospectus. The Exchange Offer is being made in order to satisfy certain
obligations of AGL Resources and the Trust contained in the Registration Rights
Agreement dated June 11, 1997, among AGL Resources, the Trust and the initial
purchasers referred to therein.
This material is being forwarded to you as the beneficial owner of the
Original Capital Securities carried by us in your account but not registered in
your name. A TENDER OF SUCH ORIGINAL CAPITAL SECURITIES MAY ONLY BE MADE BY US
AS THE HOLDER OF RECORD AND PURSUANT TO YOUR INSTRUCTIONS.
Accordingly, we request instructions as to whether you wish us to tender
on your behalf the Original Capital Securities held by us for your account,
pursuant to the terms and conditions set forth in the enclosed Prospectus and
Letter of Transmittal.
Your instructions should be forwarded to us as promptly as possible in
order to permit us to tender the Original Capital Securities on your behalf in
accordance with the provisions of the Exchange Offer. The Exchange Offer will
expire at 5:00 p.m., New York City time, on _________, 1997, or such later date
and time to which the Exchange Offer may be extended (the "Expiration Date").
Any Original Capital Securities tendered pursuant to the Exchange Offer may be
withdrawn at any time before the Expiration Date.
Your attention is directed to the following:
1. The Exchange Offer is for any and all Original Capital Securities.
2. The Exchange Offer is subject to certain conditions set forth in
the Prospectus in the section captioned "The Exchange Offer--Conditions to the
Exchange Offer."
3. Any transfer taxes incident to the transfer of Original Capital
Securities from the holder to AGL Resources will be paid by AGL Resources,
except as otherwise provided in the Instructions in the Letter of Transmittal.
4. The Exchange Offer expires at 5:00 p.m., New York City time, on
_______________, 1997, unless extended by AGL Resources or the Trust.
If you wish to have us tender your Original Capital Securities, please so
instruct us by completing, executing and returning to us the instruction form
on the back of this letter.
THE LETTER OF TRANSMITTAL IS FURNISHED TO YOU FOR INFORMATION ONLY AND MAY NOT
BE USED DIRECTLY BY YOU TO TENDER ORIGINAL CAPITAL SECURITIES.
<PAGE> 19
INSTRUCTIONS WITH RESPECT TO
THE EXCHANGE OFFER
The undersigned acknowledge(s) receipt of your letter and the enclosed
material referred to therein relating to the Exchange Offer made by AGL
Resources Inc. and AGL Capital Trust with respect to AGL Capital Trust's
Original Capital Securities.
This will instruct you to tender the Original Capital Securities held by
you for the account of the undersigned, upon and subject to the terms and
conditions set forth in the Prospectus and the related Letter of Transmittal.
Please tender the Original Capital Securities held by you for my account
as indicated below:
[ ] AGGREGATE PRINCIPAL AMOUNT AT MATURITY OF ORIGINAL CAPITAL
SECURITIES TENDERED $______________________________________________________
[ ] Please do not tender any Original Capital Securities held by you for
my account.
Date:___________________________________________________________________________
Signature(s):___________________________________________________________________
___________________________________________________________________
Please print name(s) here:______________________________________________________
______________________________________________________
Address(es):____________________________________________________________________
____________________________________________________________________
Area Code and Telephone Number(s):______________________________________________
______________________________________________
Tax Identification or Social Security Number(s):________________________________
________________________________
None of the Original Capital Securities held by us for your account
will be tendered unless we receive written instructions from you to do so.
Unless a specific contrary instruction is given in the space provided, your
signature(s) hereon shall constitute an instruction to us to tender all the
Original Capital Securities held by us for your account.
2
<PAGE> 1
Exhibit 99.2
NOTICE OF GUARANTEED DELIVERY
FOR TENDER OF
8.17% SERIES A CAPITAL SECURITIES
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
OF
AGL CAPITAL TRUST
FULLY AND UNCONDITIONALLY GUARANTEED BY
AGL RESOURCES INC.
This Notice of Guaranteed Delivery, or one substantially equivalent to
this form, must be used to accept the Exchange Offer (as defined below) if (i)
certificates for the Trust's (as defined below) 8.17% Series A Capital
Securities (the "Original Capital Securities") are not immediately available,
(ii) Original Capital Securities, the Letter of Transmittal and all other
required documents cannot be delivered to The Bank of New York (the "Exchange
Agent") on or prior to the Expiration Date (as defined in the Prospectus
referred to below) or (iii) the procedures for delivery by book-entry transfer
cannot be completed on a timely basis. This Notice of Guaranteed Delivery may
be delivered by hand, overnight courier or mail, or transmitted by facsimile
transmission, to the Exchange Agent. See "The Exchange Offer--Procedures for
Tendering Original Capital Securities" in the Prospectus. In addition, in order
to utilize the guaranteed delivery procedure to tender Original Capital
Securities pursuant to the Exchange Offer, a completed, signed and dated Letter
of Transmittal relating to the Original Capital Securities (or facsimile
thereof) must also be received by the Exchange Agent on or prior to the
Expiration Date. Capitalized terms not defined herein have the meanings
assigned to them in the Prospectus.
The Exchange Agent for the Exchange Offer is:
THE BANK OF NEW YORK
By Mail: By Hand or Overnight
(Registered or Certified Delivery:
Mail recommended)
<TABLE>
<S> <C> <C>
The Bank of New York
The Bank of New York 101 Barclay Street
101 Barclay Street - 7 East Corporate Trust Services Window,
New York, New York 10286 Facsimile Transmissions: Ground Level
Attention: Enrique Lopez (Eligible Institutions Only) New York, New York 10286
Reorganization Section (212) 815-6339 Attention: Enrique Lopez - 7 East
Reorganization Section
</TABLE>
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN AS SET
FORTH ABOVE OR TRANSMISSION OF THIS NOTICE OF GUARANTEED DELIVERY VIA FACSIMILE
TO A NUMBER OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.
This Notice of Guaranteed Delivery is not to be used to guarantee signatures.
If a signature on a Letter of Transmittal is required to be guaranteed by an
"Eligible Institution" under the instructions thereto, such signature guarantee
must appear in the applicable space provided in the signature box on the Letter
of Transmittal.
<PAGE> 2
Ladies and Gentlemen:
The undersigned hereby tenders to AGL Capital Trust, a Delaware business
trust(the "Trust") and to AGL Resources Inc., a Georgia Corporation ("AGL
Resources"), upon the terms and subject to the conditions set forth in the
Prospectus dated __________, 1997 (as the same may be amended or supplemented
from time to time, the "Prospectus"), and the related Letter of Transmittal
(which together constitute the "Exchange Offer"), receipt of which is hereby
acknowledged, the aggregate principal amount of Original Capital Securities set
forth below pursuant to the guaranteed delivery procedures set forth in the
Prospectus under the caption "The Exchange Offer--Procedures for Tendering
Original Capital Securities." All authority herein conferred or agreed to be
conferred shall survive the death or incapacity of the undersigned and every
obligation of the undersigned hereunder shall be binding upon the heirs,
personal representatives, successors and assigns of the undersigned.
Name(s) of Registered Holder(s):_______________________________________________
________________________________________________________________________________
Aggregate Liquidation Amount Tendered: $_______________________________________*
*Must be in denominations of a Liquidation Amount of $1,000 and any integral
multiple thereof, and not less than $100,000 aggregate Liquidation Amount.
Certificate No.(s) (if available):______________________________________________
________________________________________________________________________________
Total Liquidation Amount Represented by Original Capital Securities
Certificate(s): $______________________________________
If Original Capital Securities will be tendered by book-entry transfer, provide
the following information:
DTC Account Number:____________________________________________________________
PLEASE SIGN HERE
DATE
X_________________________________________________ _______________________
X_________________________________________________ _______________________
Signature(s) of Owner(s) or Authorized Signatory
Area Code and Telephone Number:_________________________________________________
This Notice of Guaranteed Delivery must be signed by the holder(s) of the
Original Capital Securities as their name(s) appear(s) on certificates for
Original Capital Securities or on a security position listing, or by person(s)
authorized to become registered holder(s) by endorsement and documents
transmitted with this Notice of Guaranteed Delivery. If
<PAGE> 3
signature is by a trustee, executor, administrator, guardian, attorney-in-fact,
officer or other person acting in a fiduciary or representative capacity, such
person must set forth his or her full title below.
Please print name(s) and address(es)
Name(s):________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Capacity:_______________________________________________________________________
Address(es):____________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
<PAGE> 4
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a firm or other entity identified in Rule 17Ad-15 under the
Securities Exchange Act of 1934, as amended, as an "eligible guarantor
institution," including (as such terms are defined therein): (i) a bank; (ii) a
broker, dealer, municipal securities broker, municipal securities dealer,
government securities broker or government securities dealer; (iii) a credit
union; (iv) a national securities exchange, registered securities association
or clearing agency; or (v) a savings association that is a participant in a
Securities Transfer Association recognized program (each of the foregoing being
referred to as an "Eligible Institution"), hereby guarantees to deliver to the
Exchange Agent, at one of its addresses set forth above, either the Original
Capital Securities tendered hereby in proper form for transfer, or confirmation
of the book-entry transfer of such Original Capital Securities to the Exchange
Agent's account at The Depository Trust Company ("DTC"), pursuant to the
procedures for book-entry transfer set forth in the Prospectus, in either case
together with one or more properly completed and duly executed Letter(s) of
Transmittal (or facsimile thereof) and any other required documents within
three business days after the date of execution of this Notice of Guaranteed
Delivery.
The undersigned acknowledges that it must deliver the Letter(s) of Transmittal
and the Original Capital Securities tendered hereby to the Exchange Agent
within the time period set forth above and that failure to do so could result
in a financial loss to the undersigned.
(PLEASE TYPE OR PRINT)
Name of Firm:________________________________________________
_____________________________________________________________
Authorized Signature
Address:_________________________________________ Title:
Dated:
_________________________________________________
Zip Code
_________________________________________________
AREA CODE AND TELEPHONE NO.
NOTE: DO NOT SEND CERTIFICATES FOR ORIGINAL CAPITAL SECURITIES WITH THIS FORM.
CERTIFICATES FOR ORIGINAL CAPITAL SECURITIES SHOULD ONLY BE SENT WITH YOUR
LETTER OF TRANSMITTAL.
<PAGE> 1
EXHIBIT 99.3
Form of Exchange Agent Agreement
The Bank of New York
101 Barclay Street, 21 West
New York, New York 10286
Ladies and Gentlemen:
AGL Capital Trust, a statutory business trust formed under the laws of
the State of Delaware (the "Trust"), proposes to make an offer (the "Exchange
Offer") to exchange its 8.17% Series A Capital Securities (Liquidation Amount
$1,000 per Capital Security) (the "Original Capital Securities") for its 8.17%
Series B Capital Securities (Liquidation Amount $1,000 per Capital Security)
(the "Exchange Capital Securities"). All of the beneficial interests represented
by common securities of the Trust are owned by AGL Resources Inc., a Georgia
corporation ("AGL Resources"). The terms and conditions of the Exchange Offer as
currently contemplated are set forth in a prospectus, dated ______________, 1997
(the "Prospectus"), to be distributed to all record holders of the Original
Capital Securities. The Original Capital Securities and the Exchange Capital
Securities are collectively referred to herein as the "Securities."
The Trust hereby appoints The Bank of New York to act as exchange agent
(the "Exchange Agent") in connection with the Exchange Offer. References
hereinafter to "you" shall refer to The Bank of New York.
The Exchange Offer is expected to be commenced by the Trust on or about
__________, 1997. The Letter of Transmittal accompanying the Prospectus is to be
used by the holders of the Original Capital Securities to accept the Exchange
Offer and contains instructions with respect to (i) the delivery of certificates
for Original Capital Securities tendered in connection therewith and (ii) the
book-entry transfer of the tendered Original Capital Securities to the Exchange
Agent's account.
The Exchange Offer shall expire at 5:00 P.M., New York City time, on
__________, 1997 or on such later date or time to which AGL Resources or the
Trust may extend the Exchange Offer (the "Expiration Date"). Subject to the
terms and conditions set forth in the Prospectus, AGL
<PAGE> 2
Resources and the Trust expressly reserve the right in their sole and absolute
discretion to extend the Exchange Offer from time to time by giving oral (to be
confirmed in writing) or written notice to you before 9:00 a.m., New York City
time, on the business day following the previously scheduled Expiration Date.
AGL Resources and the Trust expressly reserve the right in their sole
and absolute discretion, subject to applicable law, at any time and from time to
time, (i) to delay the acceptance of the Original Capital Securities for
exchange, (ii) to terminate the Exchange Offer (whether or not any Original
Capital Securities have theretofore been accepted for exchange) if the Trust
determines, in its sole and absolute discretion, that any of the events or
conditions referred to under the caption "The Exchange Offer--Conditions to the
Exchange Offer" in the Prospectus have occurred or exist or have not been
satisfied, and (iii) to waive any condition or otherwise amend the terms of the
Exchange Offer in any respect. The Trust will give oral (confirmed in writing)
or written notice of any amendment, termination, or waiver under the Exchange
Offer and of nonacceptance of Original Capital Securities to you promptly after
any amendment, termination, waiver or nonacceptance.
In carrying out your duties as Exchange Agent, you are to act in
accordance with the following instructions:
1. You will perform such duties and only such duties as are
specifically set forth in the section of the Prospectus captioned "The Exchange
Offer" or as specifically set forth herein; provided, however, that in no way
will your general duty to act in good faith be discharged by the foregoing.
2. You will establish an account with respect to the Original Capital
Securities at The Depository Trust Company (the "DTC") for purposes of the
Exchange Offer within two business days after the date of the Prospectus, and
any financial institution that is a participant in the DTC's system may make
book-entry delivery of the Original Capital Securities by causing the DTC to
transfer such Original Capital Securities into your account in accordance with
the DTC's procedure for such transfer.
3. You are to examine each of the Letters of Transmittal and
certificates for Original Capital Securities (or confirmation of book-entry
transfer into your account at the DTC), any Notice of Guaranteed Delivery and
any other documents delivered or mailed to you by or for holders of the Original
Capital Securities to ascertain whether: (i) the Letters of Transmittal and any
such other documents are duly executed and properly completed in accordance with
instructions set forth therein and (ii) the Original Capital Securities have
otherwise been properly tendered. In each case where the Letter of Transmittal
or any other document has been improperly completed or executed or any of the
certificates for Original Capital Securities are not in proper form for transfer
or some other irregularity in connection with the acceptance of the Exchange
Offer exists, you will endeavor to inform the presenters of the need for
fulfillment of all requirements and to take any other action as may be necessary
or advisable to cause such irregularity to be corrected.
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4. With the approval of any Administrative Trustee of the Trust or any
person designated in writing by AGL Resources (a "Designated Officer") (such
approval, if given orally, to be confirmed in writing) or any other party
designated by any such Administrative Trustee or Designated Officer in writing,
you are authorized to waive any irregularities in connection with any tender of
Original Capital Securities pursuant to the Exchange Offer.
5. Tenders of Original Capital Securities may be made only as set forth
in the Letter of Transmittal and in the section of the Prospectus captioned "The
Exchange Offer--Procedures for Tendering Original Capital Securities," and
Original Capital Securities shall be considered properly tendered to you only
when tendered in accordance with the procedures set forth therein.
Notwithstanding the provisions of this paragraph 5, Original Capital
Securities which any Administrative Trustee of the Trust or Designated Officer
of AGL Resources shall approve as having been properly tendered shall be
considered to be properly tendered (such approval, if given orally, shall be
confirmed in writing).
6. You shall advise the Trust and AGL Resources with respect to any
Original Capital Securities received subsequent to the Expiration Date and
accept their instructions with respect to disposition of such Original Capital
Securities.
7. You shall accept tenders:
(a) in cases where the Original Capital Securities are
registered in two or more names only if signed by all named holders;
(b) in cases where the signing person (as indicated on the
Letter of Transmittal) is acting in a fiduciary or a representative capacity
only when proper evidence of such person's authority so to act is submitted; and
(c) from persons other than the registered holder of Original
Capital Securities provided that customary transfer requirements, including any
applicable transfer taxes, are fulfilled.
You shall accept partial tenders of Original Capital Securities
where so indicated and as permitted in the Letter of Transmittal and deliver
certificates for Original Capital Securities to the transfer agent for split-up
and return any untendered Original Capital Securities to the holder (or such
other person as may be designated in the Letter of Transmittal) as promptly as
practicable after expiration or termination of the Exchange Offer.
8. Upon satisfaction or waiver of all of the conditions to the Exchange
Offer, the Trust will notify you (such notice if given orally, to be confirmed
in writing) of its acceptance, promptly after the Expiration Date, of all
Original Capital Securities properly tendered and you, on behalf of the Trust,
will exchange such Original Capital Securities for Exchange Capital Securities
and cause such Original Capital Securities to be canceled. Delivery of Exchange
Capital Securities will be
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<PAGE> 4
made on behalf of the Trust by you at the rate of $1,000 in Liquidation Amount
of Exchange Capital Securities (one Exchange Capital Security) for each $1,000
in Liquidation Amount of the corresponding series of Original Capital Securities
(one Original Capital Security) tendered promptly after notice (such notice if
given orally, to be confirmed in writing) of acceptance of said Original Capital
Securities by the Trust; provided, however, that in all cases, Original Capital
Securities tendered pursuant to the Exchange Offer will be exchanged only after
timely receipt by you of certificates for such Original Capital Securities (or
confirmation of book-entry transfer into your account at the DTC), a properly
completed and duly executed Letter of Transmittal (or facsimile thereof) with
any required signature guarantees and any other required documents. You shall
issue Exchange Capital Securities only in a Liquidation Amount of $1,000 (one
Exchange Capital Security) or any integral multiple of $1,000 in excess thereof.
Original Capital Securities may be tendered in whole or in part in a Liquidation
Amount of $100,000 (100 Original Capital Securities) and integral multiples of
$1,000 in excess thereof, provided that if any holder tenders Original Capital
Securities for exchange in part, the Liquidation Amount of the untendered
Original Capital Securities must not be less than $100,000 (100 Original Capital
Securities).
9. Tenders pursuant to the Exchange Offer are irrevocable, except that,
subject to the terms and upon the conditions set forth in the Prospectus and the
Letter of Transmittal, Original Capital Securities tendered pursuant to the
Exchange Offer may be withdrawn at any time on or prior to the Expiration Date.
10. The Trust shall not be required to exchange any Original Capital
Securities tendered if any of the conditions set forth in the Exchange Offer are
not met. Notice of any decision by the Trust not to exchange any Original
Capital Securities tendered shall be given orally (and confirmed in writing) or
in writing by the Trust to you.
11. If, pursuant to the Exchange Offer, the Trust does not accept for
exchange all or part of the Original Capital Securities tendered because of an
invalid tender, the occurrence of certain other events set forth in the
Prospectus under the caption "The Exchange Offer--Conditions to the Exchange
Offer" or otherwise, you shall promptly after the expiration or termination of
the Exchange Offer return those certificates for unaccepted Original Capital
Securities (or effect appropriate book-entry transfer), together with any
related required documents and the Letters of Transmittal relating thereto that
are in your possession, to the persons or entities who deposited them.
12. All certificates for reissued Original Capital Securities,
unaccepted Original Capital Securities or for Exchange Capital Securities shall
be forwarded by (a) first-class certified mail, return receipt requested, under
a blanket surety bond protecting you, AGL Resources and the Trust from loss or
liability arising out of the non-receipt or non-delivery of such certificates,
(b) by registered mail insured separately for the replacement value of each of
such certificates, or (c) by appropriate book-entry transfer.
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<PAGE> 5
13. You are not authorized to pay or offer to pay any concessions,
commissions or solicitation fees to any broker, dealer, bank or other persons or
to engage or utilize any person to solicit tenders.
14. As Exchange Agent hereunder you:
(a) shall have no duties or obligations other than those
specifically set forth in the section of the Prospectus captioned "The Exchange
Offer," the Letter of Transmittal or herein or as may be subsequently agreed to
in writing by you and the Trust;
(b) will be regarded as making no representations and having
no responsibilities as to the validity, sufficiency, value or genuineness of any
of the certificates or the Original Capital Securities represented thereby
deposited with you pursuant to the Exchange Offer, and will not be required to
and will make no representation as to the validity, value or genuineness of the
Exchange Offer;
(c) shall not be obligated to take any legal action hereunder
which might in your reasonable judgment involve any expense or liability, unless
you shall have been furnished with reasonable indemnity;
(d) may reasonably rely on and shall be protected in acting in
reliance upon any certificate, instrument, opinion, notice, letter, telegram or
other document or security delivered to you and reasonably believed by you to be
genuine and to have been signed by the proper party or parties;
(e) may reasonably act upon any tender, statement, request,
agreement or other instrument whatsoever not only as to its due execution and
validity and effectiveness of its provisions, but also as to the truth and
accuracy of any information contained therein, which you shall in good faith
believe to be genuine or to have been signed or represented by a proper person
or persons;
(f) may rely on and shall be protected in acting upon written
or oral instructions from any Administrative Trustee of the Trust or from any
Designated Officer of AGL Resources;
(g) may consult with your counsel with respect to any
questions relating to your duties and responsibilities and the advice or opinion
of such counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted to be taken by you hereunder in
good faith and in accordance with the advice or opinion of such counsel; and
(h) shall not advise any person tendering Original Capital
Securities pursuant to the Exchange Offer as to the wisdom of making such tender
or as to the market value or decline or appreciation in market value of any
Original Capital Securities.
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<PAGE> 6
15. You shall take such action as may from time to time be requested by
the Trust or its counsel or any Designated Officer of AGL Resources (and such
other action as you may reasonably deem appropriate) to furnish copies of the
Prospectus, Letter of Transmittal and the Notice of Guaranteed Delivery (as
defined in the Prospectus) or such other forms as may be approved from time to
time by the Trust or AGL Resources, to all persons requesting such documents and
to accept and comply with telephone requests for information relating to the
Exchange Offer, provided that such information shall relate only to the
procedures for accepting (or withdrawing from) the Exchange Offer. The Trust
will furnish you with copies of such documents at your request. All other
requests for information relating to the Exchange Offer shall be directed to the
Trust, Attention: J. Michael Riley.
16. You shall advise by facsimile transmission or telephone, and
promptly thereafter confirm in writing to J. Michael Riley of the Trust, and
such other person or persons as the Trust or AGL Resources may request, daily
(and more frequently during the week immediately preceding the Expiration Date
and if otherwise requested) up to and including the Expiration Date, as to the
number of Original Capital Securities which have been tendered pursuant to the
Exchange Offer and the items received by you pursuant to this Agreement,
separately reporting and giving cumulative totals as to items properly received
and items improperly received. In addition, you will also inform, and cooperate
in making available to, the Trust or AGL Resources or any such other person or
persons upon oral request made from time to time on or prior to the Expiration
Date of such other information as it or such person reasonably requests. Such
cooperation shall include, without limitation, the granting by you to the Trust
or AGL Resources and such person as the Trust or AGL Resources may request of
access to those persons on your staff who are responsible for receiving tenders,
in order to ensure that immediately prior to the Expiration Date the Trust or
AGL Resources shall have received information in sufficient detail to enable it
to decide whether to extend the Exchange Offer. You shall prepare a final list
of all persons whose tenders were accepted, the aggregate principal amount of
Original Capital Securities tendered and the aggregate principal amount of
Original Capital Securities accepted and deliver said list to the Trust promptly
after the Expiration Date.
17. Any Letters of Transmittal and Notices of Guaranteed Delivery which
are received by the Exchange Agent shall be stamped by you as to the date and
the time of receipt thereof and shall be preserved by you for a period of time
at least equal to the period of time you preserve other records pertaining to
the transfer of securities. You shall dispose of unused Letters of Transmittal
and other surplus materials by returning them to the Trust at the address set
forth below for notices.
18. You hereby expressly waive any lien, encumbrance or right of
set-off whatsoever that you may have with respect to funds deposited with you
for the payment of transfer taxes by reasons of amounts, if any, borrowed by AGL
Resources, the Trust, or any of its or their subsidiaries or affiliates pursuant
to any loan or credit agreement with you or for compensation owed to you
hereunder.
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<PAGE> 7
19. For services rendered as Exchange Agent hereunder, you shall be
entitled to such compensation as set forth on Schedule I attached hereto.
20. You hereby acknowledge receipt of the Prospectus and the Letter of
Transmittal and further acknowledge that you have examined each of them. Any
inconsistency between this Agreement, on the one hand, and the Prospectus and
the Letter of Transmittal (as they may be amended from time to time), on the
other hand, shall be resolved in favor of the latter two documents, except with
respect to the duties, liabilities and indemnification of you as Exchange Agent,
which shall be controlled by this Agreement.
21. (a) The Trust covenants and agrees to indemnify and hold you
harmless in your capacity as Exchange Agent hereunder against any loss,
liability, cost or expense, including reasonable attorneys' fees and expenses,
arising out of or in connection with any act, omission, delay or refusal made by
you in reliance upon any signature, endorsement, assignment, certificate, order,
request, notice, instruction or other instrument or document reasonably believed
by you to be valid, genuine and sufficient and in accepting any tender or
effecting any transfer of Original Capital Securities reasonably believed by you
in good faith to be authorized, and in delaying or refusing in good faith to
accept any tenders or effect any transfer of Original Capital Securities;
provided, however, that the Trust shall not be liable for indemnification or
otherwise for any loss, liability, cost or expense to the extent arising out of
your negligence or willful misconduct. In no case shall the Trust be liable
under this indemnity with respect to any claim against you unless the Trust
shall be notified by you, by letter or cable or by facsimile confirmed by
letter, of the written assertion of a claim against you or of any other action
commenced against you, promptly after you shall have received any such written
assertion or notice of commencement of action. The Trust shall be entitled to
participate at its own expense in the defense of any such claim or other action,
and, if the Trust so elects, the Trust may assume the defense of any suit
brought to enforce any such claim. In the event that the Trust shall assume the
defense of any such suit or threatened action in respect of which
indemnification may be sought hereunder, the Trust shall not be liable for the
fees and expenses of any additional counsel thereafter retained by you so long
as you consent to the Trust's retention of counsel, which consent may not be
unreasonably withheld; provided that the Trust shall not be entitled to assume
the defense of any such action if the named parties to such action include both
the Trust and you and representation of both parties by the same legal counsel
would, in the written opinion of counsel to you, be inappropriate due to actual
or potential conflicting interests between you and the Trust. It is understood
that the Trust shall not be liable under this paragraph for the fees and
expenses of more than one legal counsel for you. In the event that the Trust
shall assume the defense of any such suit, the Trust shall not thereafter be
liable for the fees and expenses of any counsel retained by you.
(b) You agree that, without the prior written consent of the
Trust (which consent shall not be unreasonably withheld), you will not settle,
compromise or consent to the entry of any pending or threatened claim, action or
proceeding in respect of which indemnification could be sought in accordance
with the indemnification provisions of this Agreement (whether or not you or the
Trust or any of its trustees, or controlling persons is an actual or potential
party to such claim,
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action or proceeding). Without limiting the generality of the foregoing, it is
understood and agreed that the Trust may withhold such consent if such
settlement, compromise or consent does not include an unconditional release of
the Trust and its trustees and controlling persons from all liability arising
out of such claim, action or proceeding.
22. You shall arrange to comply with all requirements under the tax
laws of the United States, including those relating to missing Tax
Identification Numbers, and shall file any appropriate reports with the Internal
Revenue Service. The Trust understands that you are required in certain
instances to deduct 31% with respect to distributions paid on the Exchange
Capital Securities and proceeds from the sale, exchange, redemption or
retirement of the Exchange Capital Securities from holders who have not supplied
their correct Taxpayer Identification Number or required certification. Such
funds will be turned over to the Internal Revenue Service in accordance with
applicable regulations.
23. You shall notify the Trust of the amount of any transfer taxes
payable solely in respect of the exchange of Original Capital Securities for
Exchange Capital Securities in the Exchange Offer and, upon receipt of written
approval from the Trust, you shall deliver or cause to be delivered, in a timely
manner to each governmental authority to which any transfer taxes are payable in
respect of such exchange of Original Capital Securities, your check in the
amount of all transfer taxes so payable, and the Trust shall reimburse you for
the amount of any and all transfer taxes payable in respect of the exchange of
Original Capital Securities; provided, however, that you shall reimburse the
Trust for amounts refunded to you in respect of your payment of any such
transfer taxes, at such time as such refund is received by you.
24. This Agreement and your appointment as Exchange Agent hereunder
shall be construed and enforced in accordance with the laws of the State of New
York applicable to agreements made and to be performed entirely within such
state, and without regard to conflicts of law principles, and shall inure to the
benefit of, and the obligations created hereby shall be binding upon, the
successors and assigns of each of the parties hereto.
25. This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
26. In case any provision of this Agreement shall be invalid, illegal
or unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
27. This Agreement shall not be deemed or construed to be modified,
amended, rescinded, canceled or waived, in whole or in part, except by a written
instrument signed by a duly authorized representative of the party to be
charged. This Agreement may not be modified orally.
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28. Unless otherwise provided herein, all notices, requests and other
communications to any party hereunder shall be in writing (including facsimile
or similar writing) and shall be given to such party, addressed to it, at its
address or telecopy number set forth below:
If to the Trust:
AGL Capital Trust
c/o AGL Resources Inc.
303 Peachtree Street, N.E.
Atlanta, Georgia 30308
Facsimile: (404) 584-3945
Attention: J. Michael Riley
If to the Exchange Agent:
The Bank of New York
101 Barclay Street, 21 West
New York, New York 10286
Telephone: ___________________
Facsimile: ____________________
Attention: ____________________
29. Unless terminated earlier by the parties hereto, this Agreement
shall terminate 90 days following the Expiration Date. Notwithstanding the
foregoing, Paragraphs 19, 21 and 23 shall survive the termination of this
Agreement. Upon any termination of this Agreement, you shall promptly deliver to
the Trust any certificates for Securities, funds or property then held by you as
Exchange Agent under this Agreement.
30. This Agreement shall be binding and effective as of the date
hereof.
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Please acknowledge receipt of this Agreement and confirm the
arrangements herein provided by signing and returning the enclosed copy.
AGL CAPITAL TRUST
By:
-----------------------------
Name: J. Michael Riley
Title: Administrative Trustee
Accepted as the date
first above written:
THE BANK OF NEW YORK as Exchange Agent
By:
-----------------------------
Name:
Title:
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<PAGE> 11
SCHEDULE I
FEES
11
